|
Delaware
(State or other jurisdiction of
incorporation or organization)
|
80-0812659
(I.R.S. Employer
Identification No.)
|
|
|
350 Fifth Avenue, 21st Floor
New York, New York
(Address of principal executive offices)
|
10118
(Zip Code)
|
Title of each class
|
|
Name of each exchange on which registered
|
Common Stock, $0.01 par value per share
|
|
New York Stock Exchange
|
Large accelerated filer
x
|
|
Accelerated filer
o
|
Non-accelerated filer
o
|
|
Smaller reporting company
o
|
|
|
Emerging growth company
o
|
|
|
|
Page
|
|
•
|
Shutterstock
- Shutterstock is our flagship brand and the majority of our revenue is generated through shutterstock.com. We continuously work to expand the collection of photographs, vectors, illustrations and video clips available on shutterstock.com to further establish Shutterstock as a top source of high-quality digital imagery for multimedia producers world-wide.
|
•
|
Bigstock
- Bigstock maintains a separate, extensive library of photographs, vectors, illustrations and video clips that is specifically curated to meet the needs of independent creators and others seeking to incorporate cost-effective digital imagery into their projects.
|
•
|
Offset
- For high-impact use cases that require extraordinary imagery, our Offset brand provides authentic and exceptional imagery, featuring work from top assignment photographers and illustrators from around the world, in addition to work from established and respected collections such as National Geographic®. Every image in the collection is hand-selected, chosen for its artistic distinction and narrative quality, and is curated into specific categories such as lifestyle, food, travel and fashion.
|
•
|
Shutterstock Select
- In November 2018, we launched
Shutterstock Select, a premium collection of royalty-free video content
available on shutterstock.com
. This diverse collection of video clips includes exclusive content widely ranging from everyday moments to blockbuster action scenes, all captured by industry professionals using cinema-grade cameras and selected by our expert curators.
|
•
|
Shutterstock Custom
- Shutterstock Custom is a complementary offering on Shutterstock’s creative platform that fulfills marketers’ need to scale unique branded content including photos, video clips, GIFs, cinemagraphs and 360° video content. Shutterstock Custom is powered by the proprietary technology that we gained through our acquisition of Flashstock Technology, Inc. (“Flashstock”) in 2017, and which we expect to grow in the future as we continue to seek expansion in the market for custom content creation.
|
•
|
Shutterstock Editorial
- Shutterstock Editorial includes Rex Features and provides editorial imagery, such as entertainment, sports and news images, to a broad range of customers from independent bloggers to traditional media outlets by providing a real-time feed of editorial content and an extensive archive of editorial images. We have entered into distribution agreements with a number of leading editorial image agencies and industry partners including exclusive distribution agreements with several third-party organizations.
|
•
|
Shutterstock Music
- Shutterstock Music provides thousands of handpicked audio tracks and sound effects at affordable prices, giving businesses, marketers, producers and filmmakers access to the audio content they need to bring their ideas to life. Shutterstock Music, along with the PremiumBeat brand, are curated royalty-free music service offerings that allow access to a full collection of exclusive, high-quality tracks and enables users to search handpicked production music from the world’s leading composers.
|
•
|
Superior search
- We obtain a high volume of data generated from user searches and content downloads, which enables us to continuously improve our search algorithms. Our behavioral and keyword data, along with our investments in technology and our experience in developing search algorithms, enhance our users’ search experience by increasing the chances that our users find the content they require in a timely and efficient manner.
|
•
|
Application programming interface (API)
- We maintain an API driven infrastructure, enabling integration of our content platform with various other software tools and services, such as Facebook Ads, IBM Watson® Content Hub, Google Ads and Wix, which allow businesses to gain access to our content without leaving their platform. In addition, we have developed plug-ins that our customers can use to seamlessly access our content directly from Adobe Creative Cloud® desktop applications, Google Slides
TM
, Apple’s Final Cut Pro® X video editing application and several Microsoft applications.
|
•
|
Showcase
- Shutterstock Showcase (www.shutterstock.com/showcase) features deep learning-powered search tools based on our most innovative artificial intelligence technology designed to help customers find the content they need fast.
|
▪
|
Reveal
is a Google Chrome
TM
browser extension allowing users to select any image online and find a similar photo, vector or illustration within Shutterstock’s collection.
|
▪
|
Copy Space
is based on Shutterstock’s custom-built computer vision technology enabling users to specifically search for images that have space for text and then select where and how much copy space is needed.
|
▪
|
Refine
enables users, from the first page of search results, to select those images most similar to what they are looking for, and Shutterstock's technology will surface other similar images.
|
▪
|
Composition Search
enables users to add keywords to a canvas to search for a specific layout of objects within an image.
|
•
|
Editor and Editor Pro
- Shutterstock Editor and Editor Pro are feature-filled cloud-based workflow tools that provide a robust solution for creative professionals to quickly size, edit and enhance images for immediate use in presentations, social media posts or advertisements. These tools are designed to simplify the process of editing Shutterstock’s millions of photos and illustrations into compelling presentations.
|
•
|
E-commerce:
The majority of our customers license content directly through our self-service web properties. E-commerce customers have the flexibility to purchase a subscription-based plan that is paid on a monthly or annual basis or to license content on a transactional basis. These customers generally license content under our standard or enhanced licenses, with additional licensing options available to meet customers’ individual needs. E-commerce customers typically pay the full amount of the purchase price in advance or at the time of license, generally with a credit card, which has historically resulted in favorable timing of cash flows relative to the time that revenue is recognized and contributor royalties are earned and paid.
|
•
|
Enterprise:
Our base of enterprise customers is mainly composed of creative professionals and large organizations with unique content, licensing and workflow needs. As our enterprise customer base has grown, the number of unique offerings has also grown, as we continue to address individual business needs. Customers of this size benefit from communication with our dedicated sales, service and research teams which provide a number of tailored enhancements to their creative workflows including non-standard licensing rights, multi-seat access, ability to pay on credit terms, multi-brand licensing packages, increased indemnification protection and content licensed for use-cases outside of those available on our e-commerce platform. We continue to focus on our localization and enterprise expansion strategy and are investing resources in cultivating key international markets which we believe have significant growth potential and strategic importance.
|
•
|
Other:
Our other sales channel includes revenue from Webdam’s digital asset management offerings which were made available through annual software-as-a-service subscription plans. On February 26, 2018, we completed a sale transaction of our digital asset management business (the “Sale of Webdam”) for an aggregate purchase price of
$49.1 million
.
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
E-Commerce
|
|
$
|
365,730
|
|
|
$
|
332,376
|
|
|
$
|
318,916
|
|
|
$
|
300,051
|
|
|
$
|
263,455
|
|
Enterprise
|
|
254,809
|
|
|
208,713
|
|
|
164,384
|
|
|
118,492
|
|
|
62,316
|
|
|||||
Other
|
|
2,711
|
|
|
16,022
|
|
|
11,017
|
|
|
6,606
|
|
|
2,200
|
|
|||||
Total Revenue
(1)
|
|
$
|
623,250
|
|
|
$
|
557,111
|
|
|
$
|
494,317
|
|
|
$
|
425,149
|
|
|
$
|
327,971
|
|
•
|
Marketing Professionals and Organizations.
Marketing professionals and organizations incorporate licensed content in the work they produce for their organizational or clients’ business communications. Whether providing graphic design, web design, interactive design, advertising, public relations, communications or marketing services,
|
•
|
Media and Broadcast Companies.
Media organizations and professionals incorporate licensed content into their work, which includes digital publications, newspapers, books, magazines, television and film, as well as to market their products effectively. Our media users range from independent bloggers to multi-national publishing, broadcast and production organizations.
|
•
|
Small and Medium-Sized Businesses.
Organizations of all sizes utilize creative content for a wide range of internal- and external-use communications such as websites, print and digital advertisements, annual reports, brochures, employee communications, newsletters, email marketing campaigns and other presentations. These organizations range in size and type of organization, from sole proprietors to large not-for-profit organizations.
|
•
|
Images.
Contributors of photographs, vectors and illustrations to our e-commerce platform typically earn a royalty each time their images are licensed. The exact amount earned is determined by the type of license obtained and our published earnings schedule which is based on (i) the contributor’s total historical earnings paid by us, which determines the contributor’s earnings tier; and (ii) the purchase option under which the content was licensed.
|
•
|
Video Clips and Music.
Contributors of video clips and music tracks also typically earn a royalty each time their video clips or music tracks are licensed. When a contributed video clip or music track is licensed, the contributor is typically paid between 30% and 50% of the sales price per download.
|
•
|
The Digital Millennium Copyright Act (the “DMCA”), which regulates digital material and created updated copyright laws to address the unique challenges of regulating the use of digital content.
|
•
|
The Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003 and similar laws adopted by a number of states, which regulate the format, functionality and distribution of commercial solicitation e-mails, create criminal penalties for unmarked sexually-oriented material, and control other online marketing practices.
|
•
|
The Children’s Online Privacy Protection Act and the Prosecutorial Remedies and Other Tools to End Exploitation of Children Today Act of 2003, which regulate the collection or use of information, and restrict the distribution of certain materials, as related to certain protected age groups. In addition, the Protection of Children From Sexual Predators Act of 1998 provides for reporting and other obligations by online service providers in the area of child pornography.
|
•
|
The Federal Trade Commission Act and numerous state “mini-FTC” acts, which bar “deceptive” and “unfair” trade practices, including in the contexts of online advertising and representations made in privacy policies and other online representations.
|
•
|
The European Union General Data Protection Regulation (“GDPR”), which governs how we can collect and process the personal data of European Union citizens.
|
•
|
other online platforms that feature marketplaces for stock content or creative workflow tools such as Getty Images and its iStockphoto offering and AdobeStock;
|
•
|
specialized visual content companies that are established in local, content or product-specific market segments, such as Visual China Group;
|
•
|
providers of commercially licensable music such as Universal Music Publishing Group, Sony/ATV Music Publishing, Warner/Chappell Music, and EMI Music Publishing;
|
•
|
websites focused on image search and discovery such as Google Images;
|
•
|
websites for image hosting, art and related products such as Flickr;
|
•
|
providers of free images, photography, music, stock video clips and related tools;
|
•
|
social networking and social media services; and
|
•
|
commissioned photographers and photography agencies.
|
•
|
the scope of content available for licensing;
|
•
|
the effectiveness of our marketing efforts;
|
•
|
the features and functionality of our platform;
|
•
|
our current products and services and ability to expand our offerings;
|
•
|
our customers’ and contributors’ experience in using our platform; and
|
•
|
the quality and accuracy of our search algorithms.
|
•
|
anticipate customers’ and contributors’ changing needs or emerging technological trends;
|
•
|
timely develop, complete and introduce innovative new products and enhancements;
|
•
|
differentiate our products from those of our competitors;
|
•
|
effectively market our products and gain market acceptance;
|
•
|
price our products competitively; and
|
•
|
provide timely, effective and accurate support to our customers and contributors.
|
•
|
modifying our technology and marketing and localizing our offerings for customers’ and contributors’ preferences, customs and language;
|
•
|
legal, political or systemic restrictions on the ability of U.S. companies to do business in foreign countries, including, among others, restrictions imposed by the U.S. Office of Foreign Assets Control (OFAC) on the ability of U.S. companies to do business in certain specified foreign countries or with certain specified organizations and individuals;
|
•
|
compliance with the U.S. Foreign Corrupt Practices Act, the U.K. Bribery Act and similar laws in other jurisdictions;
|
•
|
compliance with foreign laws and regulations, including with respect to disclosure requirements, privacy, consumer and data protection, marketing restrictions, human rights, rights of publicity, intellectual property, technology and content;
|
•
|
government regulation of e-commerce and other services and restrictive governmental actions on the distribution of content, such as censorship;
|
•
|
disturbances in a specific country’s or region’s political, economic or military conditions, including potential sanctions (e.g., civil, political and economic conditions in markets including but not limited to Russia, Ukraine and the Crimean peninsula);
|
•
|
lower levels of consumer spending in foreign countries or lack of adoption of the internet as a medium of commerce;
|
•
|
longer payment cycles in some countries, increased credit risk, and higher levels of payment fraud;
|
•
|
reduced protection for our or our contributors’ intellectual property rights in certain countries;
|
•
|
laws that grant rights that may conflict with our business operations;
|
•
|
enhanced difficulties of integrating any foreign acquisitions;
|
•
|
difficulty in staffing, developing, managing and overseeing foreign operations as a result of travel distance, language and cultural differences as well as infrastructure, human resources and legal compliance costs;
|
•
|
difficulty enforcing contractual rights in our license agreements;
|
•
|
potential adverse foreign tax consequences, especially those that may result from the expected proactive global development of greater efforts to identify, capture and subject to income and transactional tax, e-commerce revenue earned solely via the internet;
|
•
|
currency exchange fluctuations, hyperinflation, or devaluation;
|
•
|
strains on our financial and other systems to properly administer VAT, withholdings, sales and other taxes; and
|
•
|
higher costs associated with doing business internationally.
|
•
|
our ability to retain our current customers and to attract new customers and contributors;
|
•
|
our ability to provide new and relevant content to our customers;
|
•
|
our ability to effectively manage our growth;
|
•
|
the effects of increased competition on our business;
|
•
|
our ability to keep pace with changes in technology or our competitors;
|
•
|
changes in our pricing policies or the pricing policies of our competitors;
|
•
|
interruptions in service, whether or not we are responsible for such interruptions, and any related impact on our reputation and brand;
|
•
|
costs associated with defending any litigation or other claims, including those related to our indemnification of our customers;
|
•
|
our ability to pursue, and the timing of, entry into new geographies or markets and, if pursued, our management of such expansion;
|
•
|
the impact of general economic conditions on our revenue and expenses;
|
•
|
changes in government regulation affecting our business; and
|
•
|
costs related to potential acquisitions of technology or businesses.
|
•
|
disruption of our ongoing business, including diverting management’s attention from existing businesses and operations;
|
•
|
risks inherent in launching or acquiring new products or extending our existing platform, where we have limited or no experience;
|
•
|
difficulties integrating acquired technology and assets, including content collections, into our systems and offerings;
|
•
|
risks associated with any acquired liabilities;
|
•
|
difficulties integrating personnel;
|
•
|
information security vulnerabilities;
|
•
|
difficulties integrating accounting, financial reporting, management, infrastructure and information security, human resources and other administrative and operational systems;
|
•
|
potential impairment resulting from the recording of goodwill and intangible assets that are subject to impairment testing;
|
•
|
the potential damage to employee, customer, contributor and other supplier relationships; and
|
•
|
other unknown liabilities.
|
•
|
changes in projected operational and financial results;
|
•
|
announcements about our share repurchase program, including purchases or the suspension of purchases under the program;
|
•
|
issuance of new or updated research or reports by securities analysts;
|
•
|
the use by investors or analysts of third-party data regarding our business that may not reflect our actual performance;
|
•
|
fluctuations in the valuation of companies perceived by investors or analysts to be comparable to us;
|
•
|
the financial guidance we may provide to the public, any changes in such guidance, or our failure to meet such guidance;
|
•
|
additions or departures of key senior management;
|
•
|
fluctuations in the trading volume of our common stock;
|
•
|
limited “public float” in the hands of a small number of investors whose sales (or lack of sales) could result in positive or negative pricing pressure on the market price for our common stock; and
|
•
|
general economic and market conditions.
|
•
|
authorize blank check preferred stock, which could be issued with voting, liquidation, dividend and other rights superior to our common stock;
|
•
|
limit the liability of, and provide indemnification to, our directors and officers;
|
•
|
limit the ability of our stockholders to call and bring business before special meetings and to take action by written consent in lieu of a meeting;
|
•
|
require advance notice of stockholder proposals and the nomination of candidates for election to our board of directors;
|
•
|
establish a classified board of directors, as a result of which the successors to the directors whose terms have expired will be elected to serve from the time of election and qualification until the third annual meeting following their election;
|
•
|
require that directors only be removed from office for cause; and
|
•
|
limit the determination of the number of directors on our board and the filling of vacancies or newly created seats on the board to our board of directors then in office.
|
|
Year Ended December 31,
|
||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
(in thousands, except per-share data)
|
||||||||||||||||||
Consolidated Statements of Operations Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Revenue
(1)
|
$
|
623,250
|
|
|
$
|
557,111
|
|
|
$
|
494,317
|
|
|
$
|
425,149
|
|
|
$
|
327,971
|
|
Operating expenses:
(2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cost of revenue
|
267,671
|
|
|
233,102
|
|
|
203,129
|
|
|
174,526
|
|
|
130,022
|
|
|||||
Sales and marketing
|
166,448
|
|
|
146,464
|
|
|
126,626
|
|
|
106,636
|
|
|
82,125
|
|
|||||
Product development
|
58,897
|
|
|
52,486
|
|
|
47,789
|
|
|
41,322
|
|
|
38,301
|
|
|||||
General and administrative
|
97,782
|
|
|
98,710
|
|
|
70,987
|
|
|
61,647
|
|
|
38,487
|
|
|||||
Total operating expenses
|
590,798
|
|
|
530,762
|
|
|
448,531
|
|
|
384,131
|
|
|
288,935
|
|
|||||
Income from operations
|
32,452
|
|
|
26,349
|
|
|
45,786
|
|
|
41,018
|
|
|
39,036
|
|
|||||
Gain on sale of Webdam
|
38,613
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Other (expense) / income, net
(3)
|
(4,952
|
)
|
|
3,732
|
|
|
(1,289
|
)
|
|
(6,746
|
)
|
|
(859
|
)
|
|||||
Income before income taxes
|
66,113
|
|
|
30,081
|
|
|
44,497
|
|
|
34,272
|
|
|
38,177
|
|
|||||
Provision for income taxes
(4)
|
11,426
|
|
|
13,354
|
|
|
11,869
|
|
|
14,720
|
|
|
16,088
|
|
|||||
Net income
|
$
|
54,687
|
|
|
$
|
16,727
|
|
|
$
|
32,628
|
|
|
$
|
19,552
|
|
|
$
|
22,089
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income per common share (basic)
|
$
|
1.57
|
|
|
$
|
0.48
|
|
|
$
|
0.93
|
|
|
$
|
0.54
|
|
|
$
|
0.63
|
|
Net income per common share (diluted)
|
$
|
1.54
|
|
|
$
|
0.47
|
|
|
$
|
0.91
|
|
|
$
|
0.54
|
|
|
$
|
0.62
|
|
Weighted-average common shares outstanding (basic)
|
34,935
|
|
|
34,627
|
|
|
35,114
|
|
|
35,880
|
|
|
35,235
|
|
|||||
Weighted-average common shares outstanding (diluted)
|
35,420
|
|
|
35,291
|
|
|
35,861
|
|
|
36,319
|
|
|
35,913
|
|
(1)
|
Effective January 1, 2018 we adopted ASU 2014-09 using the modified retrospective approach. Historical revenue totals reflect those previously reported and have not been restated.
|
(2)
|
Includes non-cash equity-based compensation of
$23.9 million
,
$25.0 million
,
$28.1 million
,
$28.9 million
, and
$23.8 million
for the years ended
December 31, 2018
,
2017
,
2016
,
2015
, and
2014
, respectively.
|
(3)
|
Includes non-operating changes in fair value of contingent consideration related to the Webdam (2015 and 2014) and PremiumBeat (2016 and 2015) acquisitions; impairment of a long-term investment asset (2018); transaction gains and losses primarily related to cash balances of subsidiaries denominated in a currency other than the subsidiaries’ functional currencies; and interest income and expense, which is not material in any period presented.
|
(4)
|
Included in the 2017 provision for income taxes were provisional amounts for the specific tax effects of the TCJA, as it related to changes to existing United States tax law which included numerous provisions that affect businesses. These provisional amounts represented the Company’s reasonable estimates at that time. The Company has now completed its analysis of certain income tax effects of the TCJA and has not made any significant adjustments to estimates previously recorded.
|
|
As of December 31,
|
||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Consolidated Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and cash equivalents
|
$
|
230,852
|
|
|
$
|
253,428
|
|
|
$
|
224,190
|
|
|
$
|
241,304
|
|
|
$
|
233,453
|
|
Short term investments
(1)
|
—
|
|
|
—
|
|
|
54,972
|
|
|
47,078
|
|
|
54,844
|
|
|||||
Working capital
|
83,418
|
|
|
94,727
|
|
|
136,341
|
|
|
167,775
|
|
|
197,813
|
|
|||||
Property and equipment, net
|
76,188
|
|
|
85,698
|
|
|
56,101
|
|
|
32,094
|
|
|
26,744
|
|
|||||
Total assets
|
531,488
|
|
|
577,776
|
|
|
501,778
|
|
|
469,121
|
|
|
383,777
|
|
|||||
Deferred revenue
|
139,604
|
|
|
157,803
|
|
|
122,235
|
|
|
98,239
|
|
|
75,789
|
|
|||||
Total liabilities
|
244,821
|
|
|
263,191
|
|
|
215,082
|
|
|
180,556
|
|
|
132,344
|
|
|||||
Total stockholders’ equity
|
$
|
286,667
|
|
|
$
|
314,585
|
|
|
$
|
286,696
|
|
|
$
|
288,565
|
|
|
$
|
251,433
|
|
(1)
|
During the year ended December 31, 2017, we liquidated our short-term investments, which consisted primarily of short-term commercial paper.
|
|
Year Ended December 31,
|
||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Non-GAAP Financial Measures
(1)
(in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Adjusted EBITDA
|
$
|
105,114
|
|
|
$
|
88,049
|
|
|
$
|
95,463
|
|
|
$
|
84,719
|
|
|
$
|
71,088
|
|
Adjusted net income
|
$
|
55,663
|
|
|
$
|
40,843
|
|
|
$
|
55,235
|
|
|
$
|
44,181
|
|
|
$
|
38,516
|
|
Free cash flow
(2)
|
$
|
63,474
|
|
|
$
|
50,014
|
|
|
$
|
52,719
|
|
|
$
|
70,032
|
|
|
$
|
77,325
|
|
Revenue growth on a constant currency basis
|
10.7
|
%
|
|
12.6
|
%
|
|
17.6
|
%
|
|
35.9
|
%
|
|
NM
|
|
|||||
Key Operating Metrics (in millions, except revenue per download):
|
|||||||||||||||||||
Paid downloads
(3)
|
179.6
|
|
|
172.0
|
|
|
167.9
|
|
|
147.2
|
|
|
125.9
|
|
|||||
Revenue per download
(4)
|
$
|
3.40
|
|
|
$
|
3.13
|
|
|
$
|
2.88
|
|
|
$
|
2.84
|
|
|
$
|
2.58
|
|
Content in our collection (end of period)
(5)
:
|
|
|
|
|
|
|
|
|
|
||||||||||
Images
|
241.7
|
|
|
170.1
|
|
|
116.2
|
|
|
71.4
|
|
|
46.8
|
|
|||||
Video clips
|
13.1
|
|
|
9.1
|
|
|
6.2
|
|
|
3.7
|
|
|
2.3
|
|
(1)
|
See “—Non-GAAP Financial Measures” below as to how we define and calculate adjusted EBITDA, adjusted net income, revenue growth on a constant currency basis and free cash flow and for a reconciliation from net income, net cash from operating activities and revenue growth, the most directly comparable financial measures presented on a GAAP basis, to these non-GAAP financial measures and a discussion about the limitations of these financial measures.
|
(2)
|
On January 1, 2017, we adopted Accounting Standard Update 2016-09 (“ASU 2016-09”) which changed the way we report the excess tax benefit related to the exercise and vesting of equity-based compensation awards in the statement of cash flows. As a result of this adoption, we have reclassified amounts that were reported prior to adoption. As a result of this reclassification, the amounts of free cash flow reported is decreased by $0.4 million and increased by $1.7 million and $13.1 million for the years ended December 31, 2016, 2015 and 2014, respectively, from amounts previously reported.
|
(3)
|
Paid downloads is the number of paid content downloads that our customers make during a given period. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Operating Metrics—Paid Downloads” for more information as to how we define and calculate paid downloads.
|
(4)
|
Revenue per download is the amount of content-related revenue recognized in a given period divided by the number of paid downloads in that period. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Operating Metrics—Revenue per Download” for more information as to how we define and calculate revenue per download. Effective January 1, 2018 we adopted ASU 2014-09 using the modified retrospective approach. Historical revenue totals reflect those previously reported and have not been restated.
|
(5)
|
Represents images (photographs, vectors and illustrations) and video clips available on shutterstock.com at the end of the period. We exclude content from this collection metric that is not uploaded directly to our site but is available to our customers through an application program interface, custom content and certain content that may be licensed for editorial use only. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Operating Metrics—Content in our Collection” for more information as to how we define and calculate images and video clips in our collection.
|
|
Year Ended December 31,
|
||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Net income
|
$
|
54,687
|
|
|
$
|
16,727
|
|
|
$
|
32,628
|
|
|
$
|
19,552
|
|
|
$
|
22,089
|
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Depreciation and amortization
|
45,652
|
|
|
35,490
|
|
|
19,946
|
|
|
14,841
|
|
|
7,917
|
|
|||||
Disposals of property and equipment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
367
|
|
|||||
Non-cash equity-based compensation
|
23,869
|
|
|
24,958
|
|
|
28,080
|
|
|
28,860
|
|
|
23,768
|
|
|||||
Other adjustments, net
(1)
|
8,093
|
|
|
(2,480
|
)
|
|
2,940
|
|
|
6,746
|
|
|
859
|
|
|||||
Provision for income taxes
|
11,426
|
|
|
13,354
|
|
|
11,869
|
|
|
14,720
|
|
|
16,088
|
|
|||||
Gain on Sale of Webdam
|
(38,613
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Adjusted EBITDA
|
$
|
105,114
|
|
|
$
|
88,049
|
|
|
$
|
95,463
|
|
|
$
|
84,719
|
|
|
$
|
71,088
|
|
(1)
|
Included in other adjustments, net is foreign currency transaction gains and losses, the impairment of a long-term investment asset, expenses related to long-term incentives and contingent consideration related to acquisitions, and interest income and expense.
|
|
Year Ended December 31,
|
||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Net income
|
$
|
54,687
|
|
|
$
|
16,727
|
|
|
$
|
32,628
|
|
|
$
|
19,552
|
|
|
$
|
22,089
|
|
Add / (less) Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Non-cash equity-based compensation
|
23,869
|
|
|
24,958
|
|
|
28,080
|
|
|
28,860
|
|
|
23,768
|
|
|||||
Tax effect of non-cash equity-based compensation
|
(5,434
|
)
|
|
(9,175
|
)
|
|
(10,048
|
)
|
|
(10,148
|
)
|
|
(7,808
|
)
|
|||||
Acquisition-related amortization expense
|
3,841
|
|
|
4,801
|
|
|
4,309
|
|
|
4,504
|
|
|
551
|
|
|||||
Tax effect of acquisition-related amortization expense
|
(874
|
)
|
|
(1,766
|
)
|
|
(1,584
|
)
|
|
(1,640
|
)
|
|
(204
|
)
|
|||||
Acquisition-related long-term incentives and contingent consideration
(1)
|
3,141
|
|
|
1,252
|
|
|
2,925
|
|
|
4,770
|
|
|
200
|
|
|||||
Tax effect of acquisition-related long-term incentives and contingent consideration
|
(832
|
)
|
|
(460
|
)
|
|
(1,075
|
)
|
|
(1,717
|
)
|
|
(80
|
)
|
|||||
Gain on Sale of Webdam
|
(38,613
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Tax effect of gain on Sale of Webdam
|
10,996
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Impairment of long-term investment asset
|
5,881
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Tax effect of impairment of long-term investment asset
|
(999
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
One-time effect of the Tax Cuts and Jobs Act on the provision for income taxes
(2)
|
—
|
|
|
4,507
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Adjusted net income
|
$
|
55,663
|
|
|
$
|
40,844
|
|
|
$
|
55,235
|
|
|
$
|
44,181
|
|
|
$
|
38,516
|
|
(1)
|
Represents expenses related to long-term incentives and contingent consideration related to the Webdam, PremiumBeat and Flashstock acquisitions.
|
(2)
|
Represents approximately
$3.7 million
of non-cash charges related to a remeasurement of deferred tax assets related to the change in U.S. tax rates from 35% to 21% and approximately
$0.8 million
of cash charges related to a one-time U.S. transition tax on unrepatriated foreign earnings.
|
|
Year Ended December 31,
|
||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Reported revenue (in thousands)
|
$
|
623,250
|
|
|
$
|
557,111
|
|
|
$
|
494,317
|
|
|
$
|
425,149
|
|
|
$
|
327,971
|
|
Revenue growth
|
11.9
|
%
|
|
12.7
|
%
|
|
16.3
|
%
|
|
29.6
|
%
|
|
NM
|
|
|||||
Revenue growth on a constant currency basis
|
10.7
|
%
|
|
12.6
|
%
|
|
17.6
|
%
|
|
35.9
|
%
|
|
NM
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Net cash provided by operating activities
|
$
|
102,202
|
|
|
$
|
108,037
|
|
|
$
|
100,723
|
|
|
$
|
87,016
|
|
|
$
|
95,996
|
|
Capital expenditures
|
(34,890
|
)
|
|
(55,062
|
)
|
|
(39,959
|
)
|
|
(14,003
|
)
|
|
(17,950
|
)
|
|||||
Content acquisitions
|
(3,838
|
)
|
|
(2,961
|
)
|
|
(8,045
|
)
|
|
(2,981
|
)
|
|
(721
|
)
|
|||||
Free Cash Flow
|
$
|
63,474
|
|
|
$
|
50,014
|
|
|
$
|
52,719
|
|
|
$
|
70,032
|
|
|
$
|
77,325
|
|
•
|
In January 2018, we invested
$15 million
in ZCool Network Technology Limited (“ZCool”) to further expand our presence in fast growing markets. ZCool’s primary business is the operation of an e-commerce platform in China whereby customers can pay to license content contributed by creative professionals and has been the exclusive distributor of Shutterstock content in China since 2014.
|
•
|
In November 2018, we announced an exclusive partnership with rights clearance industry leader, Greenlight, enabling Shutterstock customers, including ad agencies, brands, and creatives around the world, to license for commercial use, image and video content that would otherwise only be available for editorial purposes. Greenlight offers a full scope of rights clearance services, securing permissions to use celebrities, sports, science and literature talents, historical icons, trademarks, copyrights, landmarks, locations, and any other unique intellectual property (IP) for brand and advertising campaigns.
|
•
|
In November 2018, we launched Shutterstock Select, a premium tier of royalty-free video content. This diverse collection of video clips includes exclusive content with wide ranging content from everyday moments to blockbuster action scenes, all captured by industry professionals using cinema-grade cameras and selected by our expert curators.
|
•
|
In May 2018, we unveiled a suite of deep-learning powered search tools, including Shutterstock Reveal, a new plug-in for Google Chrome, and announced Shutterstock Showcase, a new site for users to try Shutterstock’s newest and most innovative and experimental tools.
|
•
|
In May 2018, we announced a collaboration with the IBM Watson® Content Hub, allowing marketers to use IBM’s Watson® AI technology to easily pinpoint the ideal image from Shutterstock’s library, customize it using Shutterstock Editor and create campaigns to drive customer action.
|
•
|
In June 2018, we released a number of localization enhancements to our PremiumBeat site, including support in 21 languages and expansion of our extensive selection of region-specific music.
|
•
|
In August 2018, we announced a partnership whereby Magic Leap is powering its gallery and screens application for developers with Shutterstock image and video content. This enables developers to bring their imagination to life through Magic Leap’s spatial computing platform by bringing digital experiences to the physical world.
|
•
|
In October 2018, we announced the availability of editorial content on our creative platform, for the first time, providing our global customer base with instant access to over 40 million news, sports, entertainment and archival images.
|
•
|
In November 2018, we launched a workflow extension for Apple’s Final Cut Pro® X video editing application, to enable seamless access to video clips, image and music collections. The Shutterstock extension is the only stock video clip extension to be integrated with the release of Final Cut Pro® X, offering more than 250 million video, image and music assets available for license.
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
|
|
|
||||||
|
(in millions, except revenue per download)
|
||||||||||
Paid downloads (during the period)
|
179.6
|
|
|
172.0
|
|
|
167.9
|
|
|||
Revenue per download (during the period)
(1)
|
$
|
3.40
|
|
|
$
|
3.13
|
|
|
$
|
2.88
|
|
Content in our collection (end of period)
|
|
|
|
|
|
||||||
Images
|
241.7
|
|
|
170.1
|
|
|
116.2
|
|
|||
Video clips
|
13.1
|
|
|
9.1
|
|
|
6.2
|
|
(1)
|
Effective January 1, 2018 we adopted ASU 2014-09 using the modified retrospective approach. Historical revenue totals reflect those previously reported and have not been restated.
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
|
|
|
||||||
|
(in thousands)
|
||||||||||
Consolidated Statements of Operations:
|
|
|
|
|
|
|
|
|
|||
Revenue
(1)
|
$
|
623,250
|
|
|
$
|
557,111
|
|
|
$
|
494,317
|
|
Operating expenses:
|
|
|
|
|
|
||||||
Cost of revenue
|
267,671
|
|
|
233,102
|
|
|
203,129
|
|
|||
Sales and marketing
|
166,448
|
|
|
146,464
|
|
|
126,626
|
|
|||
Product development
|
58,897
|
|
|
52,486
|
|
|
47,789
|
|
|||
General and administrative
|
97,782
|
|
|
98,710
|
|
|
70,987
|
|
|||
Total operating expenses
|
590,798
|
|
|
530,762
|
|
|
448,531
|
|
|||
Income from operations
|
32,452
|
|
|
26,349
|
|
|
45,786
|
|
|||
Gain on Sale of Webdam
|
38,613
|
|
|
—
|
|
|
—
|
|
|||
Other (expense) / income, net
|
(4,952
|
)
|
|
3,732
|
|
|
(1,289
|
)
|
|||
Income before income taxes
|
66,113
|
|
|
30,081
|
|
|
44,497
|
|
|||
Provision for income taxes
|
11,426
|
|
|
13,354
|
|
|
11,869
|
|
|||
Net income
|
$
|
54,687
|
|
|
$
|
16,727
|
|
|
$
|
32,628
|
|
|
Year Ended December 31,
|
|||||||
|
2018
|
|
2017
|
|
2016
|
|||
Consolidated Statements of Operations:
|
|
|
|
|
|
|
|
|
Revenue
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
Operating expenses:
|
|
|
|
|
|
|||
Cost of revenue
|
43
|
%
|
|
42
|
%
|
|
41
|
%
|
Sales and marketing
|
27
|
%
|
|
26
|
%
|
|
26
|
%
|
Product development
|
9
|
%
|
|
9
|
%
|
|
10
|
%
|
General and administrative
|
16
|
%
|
|
18
|
%
|
|
14
|
%
|
Total operating expenses
|
95
|
%
|
|
95
|
%
|
|
91
|
%
|
Income from operations
|
5
|
%
|
|
5
|
%
|
|
9
|
%
|
Gain on Sale of Webdam
|
6
|
%
|
|
—
|
%
|
|
—
|
%
|
Other (expense) / income, net
|
(1
|
)%
|
|
1
|
%
|
|
—
|
%
|
Income before income taxes
|
11
|
%
|
|
5
|
%
|
|
9
|
%
|
Provision for income taxes
|
2
|
%
|
|
2
|
%
|
|
2
|
%
|
Net income
|
9
|
%
|
|
3
|
%
|
|
7
|
%
|
|
Year Ended December 31,
|
|||||||||||||
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|||||||
|
(in thousands)
|
|||||||||||||
Consolidated Statements of Operations Data:
|
|
|
|
|
|
|
|
|
|
|
|
|||
Revenue
(1)
|
$
|
623,250
|
|
|
$
|
557,111
|
|
|
$
|
66,139
|
|
|
12
|
%
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|||||
Cost of revenue
|
267,671
|
|
|
233,102
|
|
|
34,569
|
|
|
15
|
|
|||
Sales and marketing
|
166,448
|
|
|
146,464
|
|
|
19,984
|
|
|
14
|
|
|||
Product development
|
58,897
|
|
|
52,486
|
|
|
6,411
|
|
|
12
|
|
|||
General and administrative
|
97,782
|
|
|
98,710
|
|
|
(928
|
)
|
|
(1
|
)
|
|||
Total operating expenses
|
590,798
|
|
|
530,762
|
|
|
60,036
|
|
|
11
|
|
|||
Income from operations
|
32,452
|
|
|
26,349
|
|
|
6,103
|
|
|
23
|
|
|||
Gain on Sale of Webdam
|
38,613
|
|
|
—
|
|
|
38,613
|
|
|
*
|
|
|||
Other (expense) / income, net
|
(4,952
|
)
|
|
3,732
|
|
|
(8,684
|
)
|
|
*
|
|
|||
Income before income taxes
|
66,113
|
|
|
30,081
|
|
|
36,032
|
|
|
120
|
|
|||
Provision for income taxes
|
11,426
|
|
|
13,354
|
|
|
(1,928
|
)
|
|
(14
|
)
|
|||
Net income
|
$
|
54,687
|
|
|
$
|
16,727
|
|
|
$
|
37,960
|
|
|
227
|
%
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
(in thousands)
|
|
|
||||||
Net cash provided by operating activities
|
$
|
102,202
|
|
|
$
|
108,037
|
|
|
$
|
100,723
|
|
Net cash used in investing activities
|
$
|
(12,827
|
)
|
|
$
|
(57,365
|
)
|
|
$
|
(56,408
|
)
|
Net cash used in financing activities
(1)
|
$
|
(109,739
|
)
|
|
$
|
(33,888
|
)
|
|
$
|
(53,110
|
)
|
(1)
|
Includes repurchase of common stock under the share repurchase program. Except for the Special Dividend, no distributions or dividends have been paid during the periods presented.
|
|
Payments Due by Period
|
||||||||||||||||||
|
Total
|
|
Less Than
1 Year |
|
1 - 3 Years
|
|
3 - 5 Years
|
|
More Than
5 Years |
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Operating lease obligations
|
$
|
78,560
|
|
|
$
|
9,913
|
|
|
$
|
16,255
|
|
|
$
|
12,911
|
|
|
$
|
39,481
|
|
Purchase obligations
|
73,917
|
|
|
29,758
|
|
|
40,826
|
|
|
3,333
|
|
|
—
|
|
|||||
Total
|
$
|
152,477
|
|
|
$
|
39,671
|
|
|
$
|
57,081
|
|
|
$
|
16,244
|
|
|
$
|
39,481
|
|
•
|
Fair Value of Common Stock/Membership Unit.
The grant date fair value for stock-based awards is based on the closing price of our common stock on the NYSE on the date of grant and fair value for all other purposes related to stock-based awards is the closing price of our common stock on the NYSE on the relevant date.
|
•
|
Expected Term.
The expected term is estimated using the simplified method allowed under applicable SEC guidance.
|
•
|
Volatility.
The volatility is estimated based on historical average volatility of our common stock.
|
•
|
Risk-free Interest Rate.
The risk-free interest rate is based on the yields of U.S. Treasury securities with maturities similar to the expected term of each award group.
|
•
|
Dividend Yield.
We have not paid and do not intend to pay recurring cash dividends or distributions to our stockholders for the foreseeable future. As a result, we used an expected dividend yield of zero.
|
|
|
Year Ended December 31,
|
||||||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||||||||||||||
|
|
U.S. Dollars
|
|
Originating Currency
|
|
U.S. Dollars
|
|
Originating Currency
|
|
U.S. Dollars
|
|
Originating Currency
|
||||||||||||
Euro
|
|
$
|
124,732
|
|
|
€
|
105,327
|
|
|
$
|
102,622
|
|
|
€
|
90,965
|
|
|
$
|
81,406
|
|
|
€
|
73,580
|
|
British pounds
|
|
49,561
|
|
|
£
|
36,965
|
|
|
48,634
|
|
|
£
|
37,752
|
|
|
46,129
|
|
|
£
|
34,150
|
|
|||
All other non-U.S. currencies
(1)
|
|
44,393
|
|
|
|
|
39,376
|
|
|
|
|
33,993
|
|
|
|
|||||||||
Total foreign currency
|
|
218,686
|
|
|
|
|
190,632
|
|
|
|
|
161,528
|
|
|
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. dollar
|
|
404,564
|
|
|
|
|
366,479
|
|
|
|
|
332,790
|
|
|
|
|||||||||
Total revenue
(2)
|
|
$
|
623,250
|
|
|
|
|
$
|
557,111
|
|
|
|
|
$
|
494,318
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Includes no single currency which exceeded 5% of total revenue for any of the periods presented.
|
(2)
|
Effective January 1, 2018 we adopted ASU 2014-09 using the modified retrospective approach. Historical revenue totals reflect those previously reported and have not been restated.
|
(a)
|
The following documents are included as part of this Annual Report on Form 10-K:
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
ASSETS
|
|
|
|
|
|
||
Current assets:
|
|
|
|
|
|
||
Cash and cash equivalents
|
$
|
230,852
|
|
|
$
|
253,428
|
|
Accounts receivable, net
|
41,028
|
|
|
49,932
|
|
||
Prepaid expenses and other current assets
|
34,841
|
|
|
37,109
|
|
||
Total current assets
|
306,721
|
|
|
340,469
|
|
||
Property and equipment, net
|
76,188
|
|
|
85,698
|
|
||
Intangible assets, net
|
29,540
|
|
|
34,197
|
|
||
Goodwill
|
88,576
|
|
|
98,654
|
|
||
Deferred tax assets, net
|
12,375
|
|
|
9,761
|
|
||
Other assets
|
18,088
|
|
|
8,997
|
|
||
Total assets
|
$
|
531,488
|
|
|
$
|
577,776
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
||
Current liabilities:
|
|
|
|
|
|
||
Accounts payable
|
$
|
7,212
|
|
|
$
|
7,160
|
|
Accrued expenses
|
51,385
|
|
|
58,734
|
|
||
Contributor royalties payable
|
22,971
|
|
|
20,088
|
|
||
Deferred revenue
|
139,604
|
|
|
157,803
|
|
||
Other liabilities
|
2,131
|
|
|
1,957
|
|
||
Total current liabilities
|
223,303
|
|
|
245,742
|
|
||
Deferred tax liability, net
|
77
|
|
|
1,486
|
|
||
Other non-current liabilities
|
21,441
|
|
|
15,963
|
|
||
Total liabilities
|
244,821
|
|
|
263,191
|
|
||
Commitments and contingencies (Note 15)
|
|
|
|
|
|
||
Stockholders’ equity:
|
|
|
|
|
|
||
Common stock, $0.01 par value; 200,000 shares authorized; 37,618 and 37,270 shares issued and 35,060 and 34,712 shares outstanding as of December 31, 2018 and December 31, 2017, respectively
|
376
|
|
|
373
|
|
||
Additional paid-in capital
|
291,710
|
|
|
272,657
|
|
||
Treasury stock, at cost; 2,558 shares as of December 31, 2018 and December 31, 2017
|
(100,027
|
)
|
|
(100,027
|
)
|
||
Accumulated other comprehensive loss
|
(6,471
|
)
|
|
(3,557
|
)
|
||
Retained earnings
|
101,079
|
|
|
145,139
|
|
||
Total stockholders’ equity
|
286,667
|
|
|
314,585
|
|
||
Total liabilities and stockholders’ equity
|
$
|
531,488
|
|
|
$
|
577,776
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Revenue
|
$
|
623,250
|
|
|
$
|
557,111
|
|
|
$
|
494,317
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|||
Cost of revenue
|
267,671
|
|
|
233,102
|
|
|
203,129
|
|
|||
Sales and marketing
|
166,448
|
|
|
146,464
|
|
|
126,626
|
|
|||
Product development
|
58,897
|
|
|
52,486
|
|
|
47,789
|
|
|||
General and administrative
|
97,782
|
|
|
98,710
|
|
|
70,987
|
|
|||
Total operating expenses
|
590,798
|
|
|
530,762
|
|
|
448,531
|
|
|||
Income from operations
|
32,452
|
|
|
26,349
|
|
|
45,786
|
|
|||
Gain on Sale of Webdam
|
38,613
|
|
|
—
|
|
|
—
|
|
|||
Other (expense) / income, net
|
(4,952
|
)
|
|
3,732
|
|
|
(1,289
|
)
|
|||
Income before income taxes
|
66,113
|
|
|
30,081
|
|
|
44,497
|
|
|||
Provision for income taxes
|
11,426
|
|
|
13,354
|
|
|
11,869
|
|
|||
Net income
|
$
|
54,687
|
|
|
$
|
16,727
|
|
|
$
|
32,628
|
|
|
|
|
|
|
|
||||||
Earnings per share:
|
|
|
|
|
|
|
|
|
|||
Basic
|
$
|
1.57
|
|
|
$
|
0.48
|
|
|
$
|
0.93
|
|
Diluted
|
$
|
1.54
|
|
|
$
|
0.47
|
|
|
$
|
0.91
|
|
Weighted average shares outstanding:
|
|
|
|
|
|
|
|
|
|||
Basic
|
34,935
|
|
|
34,627
|
|
|
35,114
|
|
|||
Diluted
|
35,420
|
|
|
35,291
|
|
|
35,861
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Net income
|
$
|
54,687
|
|
|
$
|
16,727
|
|
|
$
|
32,628
|
|
Foreign currency translation (loss) / gain
|
(2,914
|
)
|
|
13,504
|
|
|
(10,612
|
)
|
|||
Other comprehensive (loss) / income
|
(2,914
|
)
|
|
13,504
|
|
|
(10,612
|
)
|
|||
Comprehensive income
|
$
|
51,773
|
|
|
$
|
30,231
|
|
|
$
|
22,016
|
|
|
|
|
|
|
Additional
Paid-in Capital |
|
Accumulated
Other Comprehensive Loss |
|
Retained
Earnings |
|
|
||||||||||||||||||
|
Common Stock
|
|
Treasury Stock
|
|
|
|
|
|
|||||||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|
|
Total
|
|||||||||||||||||
Balance at January 1, 2016
|
36,146
|
|
|
$
|
361
|
|
|
460
|
|
|
$
|
(15,635
|
)
|
|
$
|
213,851
|
|
|
$
|
(6,449
|
)
|
|
$
|
96,437
|
|
|
$
|
288,566
|
|
Equity-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
28,987
|
|
|
—
|
|
|
—
|
|
|
28,987
|
|
||||||
Issuance of common stock in connection with employee stock option exercises and RSU vesting
|
745
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
8,707
|
|
|
—
|
|
|
—
|
|
|
8,714
|
|
||||||
Common shares withheld for settlement of taxes in connection with equity-based compensation
|
(18
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,032
|
)
|
|
—
|
|
|
—
|
|
|
(1,032
|
)
|
||||||
Issuance of common stock in connection with employee stock purchase plan
|
54
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1,802
|
|
|
—
|
|
|
—
|
|
|
1,803
|
|
||||||
Tax effect from employee stock option exercises and RSU vesting
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(425
|
)
|
|
—
|
|
|
—
|
|
|
(425
|
)
|
||||||
Repurchase of Treasury Shares
|
—
|
|
|
—
|
|
|
1,650
|
|
|
(61,932
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(61,932
|
)
|
||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,612
|
)
|
|
—
|
|
|
(10,612
|
)
|
||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
32,628
|
|
|
32,628
|
|
||||||
Balance at December 31, 2016
|
36,926
|
|
|
369
|
|
|
2,110
|
|
|
(77,567
|
)
|
|
251,890
|
|
|
(17,061
|
)
|
|
129,065
|
|
|
286,696
|
|
||||||
Cumulative Effect of Accounting Change (See Note 1)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
979
|
|
|
—
|
|
|
(653
|
)
|
|
326
|
|
||||||
Balance at January 1, 2017
|
36,926
|
|
|
369
|
|
|
2,110
|
|
|
(77,567
|
)
|
|
252,869
|
|
|
(17,061
|
)
|
|
128,412
|
|
|
287,022
|
|
||||||
Equity-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
24,958
|
|
|
—
|
|
|
—
|
|
|
24,958
|
|
||||||
Issuance of common stock in connection with employee stock option exercises and RSU vesting
|
503
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
1,677
|
|
|
—
|
|
|
—
|
|
|
1,682
|
|
||||||
Common shares withheld for settlement of taxes in connection with equity-based compensation
|
(159
|
)
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
(6,846
|
)
|
|
—
|
|
|
—
|
|
|
(6,848
|
)
|
||||||
Repurchase of Treasury Shares
|
—
|
|
|
—
|
|
|
449
|
|
|
(22,460
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(22,460
|
)
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13,504
|
|
|
—
|
|
|
13,504
|
|
||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16,727
|
|
|
16,727
|
|
||||||
Balance at December 31, 2017
|
37,270
|
|
|
373
|
|
|
2,558
|
|
|
(100,027
|
)
|
|
272,657
|
|
|
(3,557
|
)
|
|
145,139
|
|
|
314,585
|
|
||||||
Cumulative Effect of Accounting Change (See Note 1)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,178
|
|
|
6,178
|
|
||||||
Balance at January 1, 2017
|
37,270
|
|
|
373
|
|
|
2,558
|
|
|
(100,027
|
)
|
|
272,657
|
|
|
(3,557
|
)
|
|
151,317
|
|
|
320,763
|
|
||||||
Equity-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
23,869
|
|
|
—
|
|
|
—
|
|
|
23,869
|
|
||||||
Issuance of common stock in connection with employee stock option exercises and RSU vesting
|
498
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
2,449
|
|
|
—
|
|
|
—
|
|
|
2,455
|
|
||||||
Common shares withheld for settlement of taxes in connection with equity-based compensation
|
(150
|
)
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
(7,266
|
)
|
|
—
|
|
|
—
|
|
|
(7,268
|
)
|
||||||
Payment of Special Dividend
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(104,925
|
)
|
|
(104,925
|
)
|
||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,914
|
)
|
|
—
|
|
|
(2,914
|
)
|
||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
54,687
|
|
|
54,687
|
|
||||||
Balance at December 31, 2018
|
37,618
|
|
|
$
|
376
|
|
|
2,558
|
|
|
$
|
(100,027
|
)
|
|
$
|
291,710
|
|
|
$
|
(6,471
|
)
|
|
$
|
101,079
|
|
|
$
|
286,667
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
CASH FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|||
Net income
|
$
|
54,687
|
|
|
$
|
16,727
|
|
|
$
|
32,628
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|
|||
Depreciation and amortization
|
45,652
|
|
|
35,490
|
|
|
19,946
|
|
|||
Deferred taxes
|
(6,270
|
)
|
|
12,491
|
|
|
1,767
|
|
|||
Non-cash equity-based compensation
|
23,869
|
|
|
24,958
|
|
|
28,080
|
|
|||
Change in fair value of contingent consideration
|
—
|
|
|
—
|
|
|
2,925
|
|
|||
Settlement of contingent consideration liability in excess of acquisition-date fair value
|
—
|
|
|
(6,255
|
)
|
|
(1,640
|
)
|
|||
Gain on Sale of Webdam
|
(38,613
|
)
|
|
—
|
|
|
—
|
|
|||
Loss on impairment of long-term investment
|
5,881
|
|
|
—
|
|
|
—
|
|
|||
Bad debt reserve
|
1,175
|
|
|
1,292
|
|
|
2,992
|
|
|||
Chargeback and sales refund reserves
|
—
|
|
|
—
|
|
|
(30
|
)
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|||
Accounts receivable
|
2,641
|
|
|
(10,015
|
)
|
|
(13,232
|
)
|
|||
Prepaid expenses and other current and non-current assets
|
113
|
|
|
(6,734
|
)
|
|
(2,412
|
)
|
|||
Accounts payable and other current and non-current liabilities
|
6,388
|
|
|
12,044
|
|
|
1,612
|
|
|||
Contributor royalties payable
|
3,021
|
|
|
(685
|
)
|
|
3,118
|
|
|||
Deferred revenue
|
3,658
|
|
|
28,724
|
|
|
24,969
|
|
|||
Net cash provided by operating activities
|
$
|
102,202
|
|
|
$
|
108,037
|
|
|
$
|
100,723
|
|
CASH FLOWS FROM INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|||
Capital expenditures
|
(34,890
|
)
|
|
(55,062
|
)
|
|
(39,959
|
)
|
|||
Investment sales, net
|
—
|
|
|
55,286
|
|
|
(7,673
|
)
|
|||
Acquisitions of businesses, net of cash acquired
|
(845
|
)
|
|
(49,571
|
)
|
|
—
|
|
|||
Proceeds from Sale of Webdam, net
|
41,804
|
|
|
—
|
|
|
—
|
|
|||
Other investments / advances
|
(15,000
|
)
|
|
(5,087
|
)
|
|
(660
|
)
|
|||
Acquisition of digital content
|
(3,838
|
)
|
|
(2,961
|
)
|
|
(8,045
|
)
|
|||
Security deposit (payment)/release
|
(58
|
)
|
|
30
|
|
|
(71
|
)
|
|||
Net cash used in investing activities
|
$
|
(12,827
|
)
|
|
$
|
(57,365
|
)
|
|
$
|
(56,408
|
)
|
CASH FLOWS FROM FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|||
Proceeds from exercise of stock options
|
2,454
|
|
|
1,682
|
|
|
8,711
|
|
|||
Proceeds from issuance of common stock under Employee Stock Purchase Plan
|
—
|
|
|
—
|
|
|
1,803
|
|
|||
Cash paid related to settlement of employee taxes related to RSU vesting
|
(7,268
|
)
|
|
(6,848
|
)
|
|
(1,032
|
)
|
|||
Cash paid for Special Dividend
|
(104,925
|
)
|
|
—
|
|
|
—
|
|
|||
Settlement of contingent consideration liability
|
—
|
|
|
(3,745
|
)
|
|
(2,360
|
)
|
|||
Repurchase of treasury shares
|
—
|
|
|
(24,977
|
)
|
|
(60,232
|
)
|
|||
Net cash used in financing activities
|
$
|
(109,739
|
)
|
|
$
|
(33,888
|
)
|
|
$
|
(53,110
|
)
|
|
|
|
|
|
|
||||||
Effect of foreign exchange rate changes on cash
|
(2,212
|
)
|
|
12,454
|
|
|
(7,535
|
)
|
|||
Net (decrease) / increase in cash, cash equivalents and restricted cash
|
(22,576
|
)
|
|
29,238
|
|
|
(16,330
|
)
|
|||
Cash, cash equivalents and restricted cash, beginning of period
|
256,041
|
|
|
226,803
|
|
|
243,133
|
|
|||
Cash, cash equivalents and restricted cash, end of period
|
$
|
233,465
|
|
|
$
|
256,041
|
|
|
$
|
226,803
|
|
|
|
|
|
|
|
||||||
Supplemental Disclosure of Cash Information:
|
|
|
|
|
|
|
|
|
|||
Cash paid for income taxes
|
$
|
580
|
|
|
$
|
4,984
|
|
|
$
|
19,186
|
|
|
As of December 31, 2018
|
|
As of December 31, 2017
|
||||
Cash and cash equivalents
|
$
|
230,852
|
|
|
$
|
253,428
|
|
Restricted cash
|
2,613
|
|
|
2,613
|
|
||
Total cash, cash equivalents and restricted cash
|
$
|
233,465
|
|
|
$
|
256,041
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Balance, beginning of period
|
$
|
4,088
|
|
|
$
|
5,495
|
|
|
$
|
3,768
|
|
Add: bad debt expense
|
1,175
|
|
|
1,292
|
|
|
2,992
|
|
|||
Less: write-offs, net of recoveries and other adjustments
|
(566
|
)
|
|
(2,699
|
)
|
|
(1,265
|
)
|
|||
Balance, end of period
|
$
|
4,697
|
|
|
$
|
4,088
|
|
|
$
|
5,495
|
|
Equipment
|
3 years
|
Furniture and fixtures
|
7 years
|
Software
|
3 years
|
Leasehold improvements
|
Shorter of expected useful life or lease term
|
•
|
Fair Value of Common Stock.
The grant date fair value for stock-based awards is based on the closing price of the Company’s common stock on the NYSE on the date of grant and fair value for all other purposes related to stock-based awards shall be the closing price of the Company’s common stock on the NYSE on the relevant date.
|
•
|
Expected Term.
The expected term is estimated using the simplified method allowed under Securities and Exchange Commission (“SEC”) guidance. In certain cases for market based awards, the Company’s expected term is based on a combination of historical data and estimates of the period of time the award will be outstanding.
|
•
|
Volatility.
The volatility is estimated based on historical price volatility of the Company’s common stock.
|
•
|
Risk-free Interest Rate.
The risk-free interest rate is based on the yields of U.S. Treasury securities with maturities similar to the expected term of each award group.
|
•
|
Dividend Yield.
The Company has not paid recurring cash distributions to its stockholders and it does not intend to do so for the foreseeable future. As a result, the Company used an expected dividend yield of zero.
|
|
As Reported
December 31, 2017
|
|
Adjustment
|
|
Revised
January 1, 2018
|
|||
Prepaid expenses and other current assets
(1)
|
37,109
|
|
|
(3,733
|
)
|
|
33,376
|
|
Deferred revenue
|
157,803
|
|
|
(9,911
|
)
|
|
147,892
|
|
Retained earnings
|
145,139
|
|
|
6,178
|
|
|
151,317
|
|
|
As Reported
Under ASU 2014-09
|
|
Impact of Adoption
|
|
Under
Legacy Guidance
|
|||
For the twelve months ended December 31, 2018:
|
|
|
|
|
|
|||
Revenue
|
623,250
|
|
|
(1,359
|
)
|
|
621,891
|
|
Cost of revenue
|
267,671
|
|
|
(185
|
)
|
|
267,486
|
|
Provision for income taxes
|
11,426
|
|
|
(188
|
)
|
|
11,238
|
|
Net income
|
54,687
|
|
|
986
|
|
|
55,673
|
|
As of December 31, 2018:
|
|
|
|
|
|
|||
Prepaid expenses and other current assets
|
34,841
|
|
|
4,106
|
|
|
38,947
|
|
Deferred revenue
|
139,604
|
|
|
11,270
|
|
|
150,874
|
|
Retained Earnings
|
101,079
|
|
|
(7,164
|
)
|
|
93,915
|
|
|
As of December 31, 2017
|
||||||||||||||
|
Aggregate
Fair Value |
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Money market accounts
|
$
|
55,775
|
|
|
$
|
55,775
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total assets measured at fair value
|
$
|
55,775
|
|
|
$
|
55,775
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Assets:
|
|
||
Cash and cash equivalents
|
$
|
1,330
|
|
Accounts receivable
|
3,105
|
|
|
Prepaid expenses and other current assets
|
155
|
|
|
Intangible Assets:
|
|
||
Customer relationships
|
3,000
|
|
|
Developed technology
|
2,200
|
|
|
Goodwill
|
46,217
|
|
|
Total assets acquired
|
56,007
|
|
|
Liabilities:
|
|
||
Accrued expenses
|
(279
|
)
|
|
Accounts payable
|
(99
|
)
|
|
Deferred tax liability, net
|
(333
|
)
|
|
Deferred revenue
|
(3,550
|
)
|
|
Total liabilities acquired
|
(4,261
|
)
|
|
Net assets acquired
|
$
|
51,746
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Computer equipment and software
|
$
|
148,104
|
|
|
$
|
118,493
|
|
Furniture and fixtures
|
10,020
|
|
|
9,970
|
|
||
Leasehold improvements
|
18,822
|
|
|
18,487
|
|
||
Property and equipment
|
176,946
|
|
|
146,950
|
|
||
Less: accumulated depreciation
|
(100,758
|
)
|
|
(61,252
|
)
|
||
Property and equipment, net
|
$
|
76,188
|
|
|
$
|
85,698
|
|
|
Content
Business |
|
Other
Category |
|
Consolidated
|
||||||
Balance as of December 31, 2017
|
$
|
89,891
|
|
|
$
|
8,763
|
|
|
$
|
98,654
|
|
Foreign currency translation adjustment
|
(1,315
|
)
|
|
—
|
|
|
(1,315
|
)
|
|||
Sale of Webdam
|
—
|
|
|
(8,763
|
)
|
|
(8,763
|
)
|
|||
Balance as of December 31, 2018
|
$
|
88,576
|
|
|
$
|
—
|
|
|
$
|
88,576
|
|
|
As of December 31, 2018
|
|
|
|
As of December 31, 2017
|
||||||||||||||||||||
|
Gross
Carrying Amount |
|
Accumulated
Amortization |
|
Net
Carrying Amount |
|
Weighted
Average Life (Years) |
|
Gross
Carrying Amount |
|
Accumulated
Amortization |
|
Net
Carrying Amount |
||||||||||||
Customer relationships
|
$
|
17,360
|
|
|
$
|
(7,135
|
)
|
|
$
|
10,225
|
|
|
9
|
|
$
|
21,008
|
|
|
$
|
(6,996
|
)
|
|
$
|
14,012
|
|
Trade name
|
6,372
|
|
|
(3,719
|
)
|
|
2,653
|
|
|
7
|
|
7,159
|
|
|
(3,299
|
)
|
|
3,860
|
|
||||||
Developed technology
|
4,780
|
|
|
(3,633
|
)
|
|
1,147
|
|
|
4
|
|
5,528
|
|
|
(3,450
|
)
|
|
2,078
|
|
||||||
Contributor content
|
19,912
|
|
|
(4,653
|
)
|
|
15,259
|
|
|
10
|
|
17,041
|
|
|
(3,066
|
)
|
|
13,975
|
|
||||||
Patents
|
259
|
|
|
(84
|
)
|
|
175
|
|
|
18
|
|
259
|
|
|
(68
|
)
|
|
191
|
|
||||||
Domain name
|
160
|
|
|
(79
|
)
|
|
81
|
|
|
13
|
|
160
|
|
|
(79
|
)
|
|
81
|
|
||||||
Total
|
$
|
48,843
|
|
|
$
|
(19,303
|
)
|
|
$
|
29,540
|
|
|
|
|
$
|
51,155
|
|
|
$
|
(16,958
|
)
|
|
$
|
34,197
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Compensation
|
$
|
15,153
|
|
|
$
|
19,897
|
|
Non-income taxes
|
7,885
|
|
|
6,895
|
|
||
Royalty tax withholdings
|
5,618
|
|
|
7,566
|
|
||
Other expenses
|
22,729
|
|
|
24,376
|
|
||
Total accrued expenses
|
$
|
51,385
|
|
|
$
|
58,734
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
(1)
|
|
2016
(1)
|
||||||
E-Commerce
|
$
|
365,730
|
|
|
$
|
332,376
|
|
|
$
|
318,916
|
|
Enterprise
|
254,809
|
|
|
208,713
|
|
|
164,384
|
|
|||
Digital asset management
(2)
|
2,711
|
|
|
16,022
|
|
|
11,017
|
|
|||
Total Revenues
|
$
|
623,250
|
|
|
$
|
557,111
|
|
|
$
|
494,317
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Cost of revenue
|
$
|
523
|
|
|
$
|
795
|
|
|
$
|
1,938
|
|
Sales and marketing
|
2,218
|
|
|
4,452
|
|
|
5,444
|
|
|||
Product development
|
5,815
|
|
|
6,162
|
|
|
7,681
|
|
|||
General and administrative
|
15,313
|
|
|
13,549
|
|
|
13,017
|
|
|||
Total
|
$
|
23,869
|
|
|
$
|
24,958
|
|
|
$
|
28,080
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Stock Options
|
$
|
6,009
|
|
|
$
|
6,364
|
|
|
$
|
7,295
|
|
Restricted Stock Units
|
17,860
|
|
|
18,594
|
|
|
20,179
|
|
|||
ESPP
|
—
|
|
|
—
|
|
|
606
|
|
|||
Total
|
$
|
23,869
|
|
|
$
|
24,958
|
|
|
$
|
28,080
|
|
|
As of December 31,
|
||||||
|
2018
|
|
2017
|
||||
Stock options outstanding
|
$
|
2,500
|
|
|
$
|
6,400
|
|
Stock options exercisable
|
1,800
|
|
|
3,600
|
|
||
Stock options vested and expected to vest
|
$
|
2,500
|
|
|
$
|
6,400
|
|
|
Year Ended Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Expected term (in years)
|
6.3
|
|
|
6.2
|
|
|
6.3
|
|
|||
Volatility
|
47.8
|
%
|
|
50.0
|
%
|
|
52.5
|
%
|
|||
Risk-free interest rate
|
2.625
|
%
|
|
2.15
|
%
|
|
1.48
|
%
|
|||
Dividend yield
|
—
|
|
|
—
|
|
|
—
|
|
|||
Valuation Data:
|
|
|
|
|
|
|
|
|
|||
Weighted average fair value per share granted
|
$
|
23.64
|
|
|
$
|
24.19
|
|
|
$
|
19.03
|
|
|
Plan
RSUs |
|
Weighted Average
Fair Value |
|||
Non-vested balance at December 31, 2017
|
1,173,160
|
|
|
$
|
43.79
|
|
Units granted
|
576,192
|
|
|
47.92
|
|
|
Special Dividend Adjustment
|
59,888
|
|
|
—
|
|
|
Units vested
|
(402,734
|
)
|
|
42.18
|
|
|
Units canceled or forfeited
|
(343,181
|
)
|
|
43.56
|
|
|
Non-vested balance at December 31, 2018
|
1,063,325
|
|
|
$
|
44.23
|
|
|
|
|
|
|||
Non-vested and deferred balance at December 31, 2018
|
1,084,453
|
|
|
$
|
44.49
|
|
|
|
Year Ended Year Ended December 31,
|
|
|
|
2016
|
|
Expected term (in years)
|
|
0.5
|
|
Volatility
|
|
59.1
|
%
|
Risk-free interest rate
|
|
0.46
|
%
|
Dividend yield
|
|
—
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Foreign currency (loss) / gain
|
$
|
(1,807
|
)
|
|
$
|
2,841
|
|
|
$
|
(167
|
)
|
Change in contingent consideration fair value
|
—
|
|
|
—
|
|
|
(1,271
|
)
|
|||
Impairment of long-term investment asset
|
(5,881
|
)
|
|
—
|
|
|
—
|
|
|||
Interest income
|
2,736
|
|
|
891
|
|
|
149
|
|
|||
Other (expense) / income, net
|
$
|
(4,952
|
)
|
|
$
|
3,732
|
|
|
$
|
(1,289
|
)
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Domestic
|
$
|
68,596
|
|
|
$
|
24,558
|
|
|
$
|
38,549
|
|
Foreign
|
(2,483
|
)
|
|
5,523
|
|
|
5,948
|
|
|||
Income before income taxes
|
$
|
66,113
|
|
|
$
|
30,081
|
|
|
$
|
44,497
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Current provision (benefit):
|
|
|
|
|
|
|
|
|
|||
Federal
|
$
|
7,670
|
|
|
$
|
(4,813
|
)
|
|
$
|
6,389
|
|
State and local
|
4,800
|
|
|
112
|
|
|
852
|
|
|||
Foreign
|
5,226
|
|
|
5,564
|
|
|
2,861
|
|
|||
Deferred provision (benefit):
|
|
|
|
|
|
|
|
|
|||
Federal
|
(2,901
|
)
|
|
14,578
|
|
|
3,376
|
|
|||
State and local
|
(164
|
)
|
|
523
|
|
|
(34
|
)
|
|||
Foreign
|
(3,205
|
)
|
|
(2,610
|
)
|
|
(1,575
|
)
|
|||
Provision for income taxes
|
$
|
11,426
|
|
|
$
|
13,354
|
|
|
$
|
11,869
|
|
|
Year Ended December 31,
|
|||||||
|
2018
|
|
2017
|
|
2016
|
|||
U.S. income tax at federal statutory rate
|
21.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
Tax credits
|
(5.4
|
)
|
|
(4.0
|
)
|
|
(12.0
|
)
|
State and local taxes, net of federal benefit
|
1.9
|
|
|
2.1
|
|
|
2.9
|
|
Equity-based compensation
(1)
|
(0.4
|
)
|
|
1.9
|
|
|
2.1
|
|
Foreign rate differential
|
0.5
|
|
|
(2.3
|
)
|
|
(1.8
|
)
|
Foreign-derived intangible income deduction
|
(3.7
|
)
|
|
—
|
|
|
—
|
|
Uncertain tax positions
|
3.6
|
|
|
5.2
|
|
|
(0.4
|
)
|
Transition tax related to TCJA
|
(0.3
|
)
|
|
2.6
|
|
|
—
|
|
U.S. Federal rate change related to TCJA
|
—
|
|
|
12.4
|
|
|
—
|
|
Domestic production activities deduction
|
—
|
|
|
(9.8
|
)
|
|
—
|
|
Non-deductible—other
|
0.1
|
|
|
1.3
|
|
|
0.9
|
|
Total provision for income taxes
|
17.3
|
%
|
|
44.4
|
%
|
|
26.7
|
%
|
(1)
|
Included in this amount for the years ended December 31, 2018 and 2017 is the impact of windfall/shortfall related to stock option exercises and RSU vestings that were reflected in additional paid-in capital, prior to the adoption of ASU 2016-09 on January 1, 2017. All periods presented include the impact of non-deductible stock-based compensation expenses.
|
|
Year Ended
December 31, |
||||||
|
2018
|
|
2017
|
||||
Deferred tax assets:
|
|
|
|
|
|
||
Non-cash equity-based compensation
|
$
|
9,383
|
|
|
$
|
8,342
|
|
Intangible amortization
|
3,252
|
|
|
4,555
|
|
||
Non-income tax accruals
|
3,087
|
|
|
2,887
|
|
||
Deferred rent
|
2,537
|
|
|
2,484
|
|
||
Other liabilities
|
6,523
|
|
|
2,895
|
|
||
Deferred tax assets
|
24,782
|
|
|
21,163
|
|
||
Deferred tax liabilities:
|
|
|
|
|
|
||
Depreciation and amortization
|
(12,484
|
)
|
|
(12,888
|
)
|
||
Net deferred tax assets
|
$
|
12,298
|
|
|
$
|
8,275
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Balance of unrecognized tax benefits at January 1
|
$
|
2,966
|
|
|
$
|
1,455
|
|
|
$
|
1,479
|
|
Gross additions for tax positions for prior years
|
332
|
|
|
1,412
|
|
|
886
|
|
|||
Gross additions for tax positions for current year
|
3,476
|
|
|
273
|
|
|
360
|
|
|||
Gross expirations
|
(928
|
)
|
|
(174
|
)
|
|
(1,270
|
)
|
|||
Balance of unrecognized tax benefits at December 31
|
$
|
5,846
|
|
|
$
|
2,966
|
|
|
$
|
1,455
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Net income
|
$
|
54,687
|
|
|
$
|
16,727
|
|
|
$
|
32,628
|
|
Shares used to compute basic net income per share
|
34,935
|
|
|
34,627
|
|
|
35,114
|
|
|||
Dilutive potential common shares:
|
|
|
|
|
|
||||||
Stock options and employee stock purchase plan shares
|
117
|
|
|
388
|
|
|
441
|
|
|||
Unvested restricted stock awards
|
368
|
|
|
276
|
|
|
306
|
|
|||
Shares used to compute diluted net income per share
|
35,420
|
|
|
35,291
|
|
|
35,861
|
|
|||
Basic net income per share
|
$
|
1.57
|
|
|
$
|
0.48
|
|
|
$
|
0.93
|
|
Diluted net income per share
|
$
|
1.54
|
|
|
$
|
0.47
|
|
|
$
|
0.91
|
|
|
|
|
|
|
|
||||||
Potentially dilutive shares included in the calculation
|
1,285
|
|
|
1,384
|
|
|
1,954
|
|
|||
Anti-dilutive shares excluded from the calculation
|
1,020
|
|
|
1,325
|
|
|
999
|
|
|
Content
Segment
|
|
Other and Corporate
|
|
Consolidated
|
||||||
December 31, 2018
|
|
|
|
|
|
||||||
Revenue
(1)
|
$
|
620,539
|
|
|
$
|
2,711
|
|
|
$
|
623,250
|
|
Operating Expenses
(2)
|
490,985
|
|
|
99,813
|
|
|
590,798
|
|
|||
Income from Operations
|
129,554
|
|
|
(97,102
|
)
|
|
32,452
|
|
|||
December 31, 2017
|
|
|
|
|
|
||||||
Revenue
(1)
|
541,088
|
|
|
16,023
|
|
|
557,111
|
|
|||
Operating Expenses
(2)
|
417,507
|
|
|
113,255
|
|
|
530,762
|
|
|||
Income from Operations
|
123,581
|
|
|
(97,232
|
)
|
|
26,349
|
|
|||
December 31, 2016
|
|
|
|
|
|
||||||
Revenue
(1)
|
483,278
|
|
|
11,039
|
|
|
494,317
|
|
|||
Operating Expenses
(2)
|
364,631
|
|
|
83,900
|
|
|
448,531
|
|
|||
Income from Operations
|
$
|
118,647
|
|
|
$
|
(72,861
|
)
|
|
$
|
45,786
|
|
(1)
|
Effective January 1, 2018 the Company adopted ASU 2014-09 using the modified retrospective approach. Historical revenue totals reflect those previously reported and have not been restated.
|
(2)
|
Other and corporate operating expenses include unallocated corporate expenses of approximately
$97.8 million
,
$96.5 million
and
$67.7 million
for the years ended
December 31, 2018
,
2017
, and
2016
, respectively. Unallocated corporate expenses primarily relate to shared operational support functions and general and administrative functions of human resources, legal, finance and information technology.
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
North America
|
$
|
230,890
|
|
|
$
|
218,865
|
|
|
$
|
197,650
|
|
Europe
|
207,634
|
|
|
181,693
|
|
|
161,906
|
|
|||
Rest of the world
|
184,726
|
|
|
156,553
|
|
|
134,761
|
|
|||
Total revenue
|
$
|
623,250
|
|
|
$
|
557,111
|
|
|
$
|
494,317
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
North America
|
$
|
71,758
|
|
|
$
|
83,027
|
|
Europe
|
4,371
|
|
|
2,599
|
|
||
Rest of world
|
59
|
|
|
72
|
|
||
Total long-lived tangible assets
|
$
|
76,188
|
|
|
$
|
85,698
|
|
Year Ending December 31,
|
Operating
Leases |
|
Other Obligations
|
||||
2019
|
$
|
9,913
|
|
|
$
|
29,758
|
|
2020
|
8,762
|
|
|
27,056
|
|
||
2021
|
7,493
|
|
|
13,770
|
|
||
2022
|
6,829
|
|
|
3,333
|
|
||
2023
|
6,082
|
|
|
—
|
|
||
Thereafter
|
39,481
|
|
|
—
|
|
||
Total minimum lease payments
|
$
|
78,560
|
|
|
$
|
73,917
|
|
|
Three Months Ended
|
||||||||||||||||||||||||||||||
|
Dec 31, 2018
|
|
Sep 30, 2018
|
|
Jun 30, 2018
|
|
Mar 31, 2018
|
|
Dec 31, 2017
|
|
Sep 30, 2017
|
|
Jun 30, 2017
|
|
Mar 31, 2017
|
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
(in thousands, except per share data)
|
||||||||||||||||||||||||||||||
Revenue
(1) (2)
|
$
|
162,072
|
|
|
$
|
151,575
|
|
|
$
|
156,584
|
|
|
$
|
153,019
|
|
|
$
|
151,829
|
|
|
$
|
141,063
|
|
|
$
|
133,995
|
|
|
$
|
130,224
|
|
Operating expenses
(3)
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Cost of revenue
|
68,829
|
|
|
66,461
|
|
|
67,891
|
|
|
64,490
|
|
|
64,590
|
|
|
58,812
|
|
|
57,289
|
|
|
52,411
|
|
||||||||
Sales & marketing
|
43,034
|
|
|
41,028
|
|
|
42,018
|
|
|
40,368
|
|
|
40,844
|
|
|
36,008
|
|
|
37,109
|
|
|
32,503
|
|
||||||||
Product development
|
11,689
|
|
|
14,032
|
|
|
16,728
|
|
|
16,448
|
|
|
15,210
|
|
|
13,340
|
|
|
12,892
|
|
|
11,044
|
|
||||||||
General and administrative
|
22,881
|
|
|
23,355
|
|
|
24,322
|
|
|
27,224
|
|
|
23,994
|
|
|
27,333
|
|
|
23,420
|
|
|
23,963
|
|
||||||||
Total operating expenses
|
146,433
|
|
|
144,876
|
|
|
150,959
|
|
|
148,530
|
|
|
144,638
|
|
|
135,493
|
|
|
130,710
|
|
|
119,921
|
|
||||||||
Income from operations
|
15,639
|
|
|
6,699
|
|
|
5,625
|
|
|
4,489
|
|
|
7,191
|
|
|
5,570
|
|
|
3,285
|
|
|
10,303
|
|
||||||||
Gain on Sale of Webdam
|
—
|
|
|
—
|
|
|
—
|
|
|
38,613
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Other income / (expense), net
(4)
|
1,048
|
|
|
217
|
|
|
(7,019
|
)
|
|
802
|
|
|
1,637
|
|
|
130
|
|
|
1,510
|
|
|
455
|
|
||||||||
Income / (Loss) before income taxes
|
16,687
|
|
|
6,916
|
|
|
(1,394
|
)
|
|
5,291
|
|
|
8,828
|
|
|
5,700
|
|
|
4,795
|
|
|
10,758
|
|
||||||||
Provision / (Benefit) for income tax
(5)
|
1,774
|
|
|
(531
|
)
|
|
(1,140
|
)
|
|
11,323
|
|
|
6,772
|
|
|
698
|
|
|
1,729
|
|
|
4,155
|
|
||||||||
Net income available to common stockholders
|
$
|
14,913
|
|
|
$
|
7,447
|
|
|
$
|
(254
|
)
|
|
$
|
(6,032
|
)
|
|
$
|
2,056
|
|
|
$
|
5,002
|
|
|
$
|
3,066
|
|
|
$
|
6,603
|
|
Net income per common share available to common stockholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.43
|
|
|
$
|
0.21
|
|
|
$
|
(0.01
|
)
|
|
$
|
0.94
|
|
|
$
|
0.06
|
|
|
$
|
0.14
|
|
|
$
|
0.09
|
|
|
$
|
0.19
|
|
Diluted
|
$
|
0.42
|
|
|
$
|
0.21
|
|
|
$
|
(0.01
|
)
|
|
$
|
0.92
|
|
|
$
|
0.06
|
|
|
$
|
0.14
|
|
|
$
|
0.09
|
|
|
$
|
0.19
|
|
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
35,047
|
|
|
34,991
|
|
|
34,913
|
|
|
34,784
|
|
|
34,686
|
|
|
34,643
|
|
|
34,581
|
|
|
34,597
|
|
||||||||
Diluted
|
35,421
|
|
|
35,570
|
|
|
34,913
|
|
|
35,318
|
|
|
35,149
|
|
|
35,177
|
|
|
35,250
|
|
|
35,595
|
|
(1)
|
The Company has recorded certain immaterial adjustments to its unaudited consolidated financial statements for the correction of errors related to prior periods, as follows: (i) During the third quarter of 2018, to decrease enterprise revenue by approximately
$0.8 million
; (ii) During the second quarter of 2018 to increase enterprise revenue by approximately
$0.4 million
and to increase general and administrative expense by approximately
$0.8 million
; (iii) During the third quarter of 2017, to increase enterprise revenue by approximately
$0.9 million
; and, (iv) During the second quarter of 2017, to reduce enterprise revenue by approximately
$0.6 million
and increase general and administrative expense by approximately
$0.1 million
. The Company has concluded that the impact of the adjustments recorded during 2018 but related to prior years is not material to the results of operations or financial position for the periods in which these adjustments were recorded nor any prior period financial statements.
|
(2)
|
Effective January 1, 2018 the Company adopted ASU 2014-09 using the modified retrospective approach. Historical revenue totals reflect those previously reported and have not been restated.
|
(3)
|
Includes non-cash equity-based compensation of
$23,869
and
$24,958
for the years ended
December 31, 2018
and
2017
, respectively.
|
(4)
|
Includes the impairment of a long-term investment asset; changes in fair value of contingent consideration related to the PremiumBeat acquisition; transaction gains and losses primarily related to cash balances of subsidiaries denominated in a currency other than the subsidiaries’ functional currencies; and interest income and expense, which is not material in any period presented.
|
(5)
|
Included in the provision for income taxes for the three months ended December 31, 2017 is approximately
$3.7 million
of non-cash charges related to a remeasurement of deferred tax assets related to the change in U.S. tax rates from
35%
to
21%
and approximately
$0.8 million
of cash charges related to a one-time U.S. cash tax for unrepatriated foreign earnings related to the TCJA.
|
Exhibit
Number
|
|
|
|
Incorporated by Reference
|
|||||||
|
Exhibit Description
|
|
Form
|
|
File No.
|
|
Exhibit
|
|
Filing Date
|
||
2.1
|
|
|
|
S-1/A
|
|
333-181376
|
|
2.1
|
|
October 5, 2012
|
|
2.2
|
|
|
|
S-1/A
|
|
333-181376
|
|
2.2
|
|
October 5, 2012
|
|
3.1
|
|
|
|
S-1/A
|
|
333-181376
|
|
3.2
|
|
June 29, 2012
|
|
3.2
|
|
|
|
S-1/A
|
|
333-181376
|
|
3.4
|
|
September 27, 2012
|
|
4.1
|
|
|
|
S-1/A
|
|
333-181376
|
|
4.2
|
|
October 5, 2012
|
|
10.1
|
|
§
|
|
S-1/A
|
|
333-181376
|
|
10.1
|
|
August 30, 2012
|
|
10.2
|
|
§
|
|
10-K
|
|
001-35669
|
|
10.2
|
|
February 27, 2015
|
|
10.3
|
|
§
|
|
S-1/A
|
|
333-181376
|
|
10.3
|
|
June 29, 2012
|
|
10.4
|
|
§
|
|
S-1/A
|
|
333-181376
|
|
10.7
|
|
August 30, 2012
|
|
10.5(a)
|
|
§
|
|
S-1/A
|
|
333-181376
|
|
10.8(a)
|
|
September 27, 2012
|
|
10.5(b)
|
|
§
|
|
S-1/A
|
|
333-181376
|
|
10.8(b)
|
|
September 27, 2012
|
|
10.5(c)
|
|
§
|
|
8-K
|
|
001-35669
|
|
N/A
|
|
April 28, 2014
|
|
10.6(a)
|
|
§
|
|
8-K
|
|
001-35669
|
|
10.1
|
|
August 6, 2015
|
|
10.6(b)
|
|
§
|
|
10-K
|
|
001-35669
|
|
10.1
|
|
February 27, 2017
|
|
10.7
|
|
|
|
10-Q
|
|
001-35669
|
|
10.1
|
|
May 10, 2013
|
|
10.8
|
|
|
|
10-Q
|
|
001-35669
|
|
10.3
|
|
November 6, 2015
|
|
10.9
|
|
|
|
8-K
|
|
001-35669
|
|
10.1
|
|
January 13, 2016
|
|
10.10
|
|
|
|
10-Q
|
|
001-35669
|
|
10.1
|
|
August 4, 2016
|
|
10.11
|
|
§**
|
|
|
|
|
|
|
|
|
|
10.12
|
|
§
|
|
10-Q
|
|
001-35669
|
|
10.5
|
|
May 4, 2016
|
|
10.13
|
|
§
|
|
10-Q
|
|
001-35669
|
|
10.6
|
|
May 4, 2016
|
|
10.14
|
|
§
|
|
10-Q
|
|
001-35669
|
|
10.7
|
|
May 4, 2016
|
|
10.15
|
|
§
|
|
10-Q
|
|
001-35669
|
|
10.4
|
|
August 4, 2016
|
|
10.16
|
|
§
|
|
10-Q
|
|
001-35669
|
|
10.1
|
|
November 4, 2016
|
|
10.17
|
|
§
|
|
10-Q
|
|
001-35669
|
|
10.2
|
|
November 4, 2016
|
|
10.18
|
|
§
|
|
10-Q
|
|
001-35669
|
|
10.3
|
|
November 4, 2016
|
|
10.19
|
|
§
|
|
10-Q
|
|
001-35669
|
|
10.1
|
|
May 3, 2017
|
|
10.20
|
|
§
|
|
8-K
|
|
001-35669
|
|
10.1
|
|
August 4, 2017
|
Exhibit
Number
|
|
|
|
Incorporated by Reference
|
|||||||
|
Exhibit Description
|
|
Form
|
|
File No.
|
|
Exhibit
|
|
Filing Date
|
||
10.21
|
|
§
|
|
10-Q
|
|
001-35669
|
|
10.2
|
|
May 3, 2017
|
|
10.22
|
|
§
|
|
10-K
|
|
001-35669
|
|
10.24
|
|
February 22, 2018
|
|
10.23
|
|
§
|
|
10-Q
|
|
001-35669
|
|
10.3
|
|
May 3, 2017
|
|
10.24
|
|
§
|
|
10-Q
|
|
001-35669
|
|
10.4
|
|
May 3, 2017
|
|
10.25
|
|
§
|
|
10-Q
|
|
001-35669
|
|
10.5
|
|
May 3, 2017
|
|
10.26
|
|
§
|
|
10-Q
|
|
001-35669
|
|
10.1
|
|
April 26, 2018
|
|
10.27
|
|
§
|
|
10-Q
|
|
001-35669
|
|
10.2
|
|
April 26, 2018
|
|
21.1
|
|
**
|
|
|
|
|
|
|
|
|
|
23.1
|
|
**
|
|
|
|
|
|
|
|
|
|
24.1
|
|
**
|
Power of Attorney (included on signature page of this Annual Report on Form 10-K).
|
|
|
|
|
|
|
|
|
31.1
|
|
**
|
|
|
|
|
|
|
|
|
|
31.2
|
|
**
|
|
|
|
|
|
|
|
|
|
32
|
|
#**
|
|
|
|
|
|
|
|
|
|
101.INS
|
|
*
|
XBRL Instance Document.
|
|
|
|
|
|
|
|
|
101.SCH
|
|
*
|
XBRL Taxonomy Extension Schema Document.
|
|
|
|
|
|
|
|
|
101.CAL
|
|
*
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
|
|
|
|
|
|
|
|
101.DEF
|
|
*
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
|
|
|
|
|
|
|
|
101.LAB
|
|
*
|
XBRL Taxonomy Extension Label Linkbase Document.
|
|
|
|
|
|
|
|
|
101.PRE
|
|
*
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
|
|
|
|
|
|
|
|
|
SHUTTERSTOCK, INC.
|
|
Dated: February 26, 2019
|
By:
|
/s/ JONATHAN ORINGER
|
|
|
Jonathan Oringer
Chairman of the Board and Chief Executive Officer
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/ JONATHAN ORINGER
|
|
Chairman of the Board, Chief Executive Officer and Director (Principal Executive Officer)
|
|
February 26, 2019
|
Jonathan Oringer
|
|
|
|
|
/s/ STEVEN BERNS
|
|
Chief Operating Officer and Chief Financial Officer (Principal Financial Officer)
|
|
February 26, 2019
|
Steven Berns
|
|
|
|
|
/s/ STEVEN CIARDIELLO
|
|
Chief Accounting Officer (Principal Accounting Officer)
|
|
February 26, 2019
|
Steven Ciardiello
|
|
|
|
|
/s/ DEIRDRE M. BIGLEY
|
|
Director
|
|
February 26, 2019
|
Deirdre M. Bigley
|
|
|
|
|
/s/ JEFF EPSTEIN
|
|
Director
|
|
February 26, 2019
|
Jeff Epstein
|
|
|
|
|
/s/ THOMAS R. EVANS
|
|
Director
|
|
February 26, 2019
|
Thomas R. Evans
|
|
|
|
|
/s/ PAUL J. HENNESSY
|
|
Director
|
|
February 26, 2019
|
Paul J. Hennessy
|
|
|
|
|
|
|
Chairperson
|
|
Other Members
|
|
|||
|
|
|
|
|
|
|||
Audit Committee:
|
|
$
|
20,000
|
|
|
$
|
10,000
|
|
|
|
|
|
|
|
|||
Compensation Committee:
|
|
$
|
10,000
|
|
|
$
|
5,000
|
|
|
|
|
|
|
|
|||
Nominating and Corporate Governance Committee:
|
|
—
|
|
|
$
|
2,500
|
|
Name of Subsidiary
|
|
Jurisdiction
|
Shutterstock Images C.V.
|
|
The Netherlands
|
Shutterstock Netherlands B.V.
|
|
The Netherlands
|
Shutterstock GmbH
|
|
Germany
|
Shutterstock (UK) Ltd.
|
|
United Kingdom
|
Shutterstock International Services EMEA Ltd.
|
|
United Kingdom
|
Rex Features (Holdings) Ltd.
|
|
United Kingdom
|
Rex Features Ltd.
|
|
United Kingdom
|
Shutterstock (France) SAS
|
|
France
|
Shutterstock Ireland Ltd
|
|
Ireland
|
Shutterstock Italy Srl
|
|
Italy
|
Shutterstock Japan GK
|
|
Japan
|
Shutterstock Brazil Servicos de Imagem Ltda.
|
|
Brazil
|
Shutterstock Canada ULC
|
|
Canada
|
Shutterstock Australia
|
|
Australia
|
Shutterstock Korea Ltd
|
|
Korea
|
Shutterstock Singapore Pte. Ltd.
|
|
Singapore
|
Shutterstock International Services APAC PTE Ltd
|
|
Singapore
|
1.
|
I have reviewed this annual report on Form 10-K of Shutterstock, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: February 26, 2019
|
By:
|
/s/ Jonathan Oringer
|
|
|
Jonathan Oringer
|
|
|
Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
1.
|
I have reviewed this annual report on Form 10-K of Shutterstock, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date: February 26, 2019
|
By:
|
/s/ Steven Berns
|
|
|
Steven Berns
|
|
|
Chief Financial Officer
|
|
|
(Principal Financial Officer)
|
Date: February 26, 2019
|
By:
|
/s/ Jonathan Oringer
|
|
|
Jonathan Oringer
|
|
|
Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
Date: February 26, 2019
|
By:
|
/s/ Steven Berns
|
|
|
Steven Berns
|
|
|
Chief Financial Officer
|
|
|
(Principal Financial Officer)
|