Ladies and gentlemen, thank you for standing by, and welcome to the Comscore First Quarter 2020 Financial Results Conference Call. After the speakers' presentation, there will be a question-and-answer session. I would now like to hand the conference over to your speaker today, Mr. Chris Ferris, Director of Investor Relations. Thank you. Please, go ahead, sir.

Thank you, operator. Before we begin our prepared remarks, I'd like to remind all of you that the following discussion contains forward-looking statements. These forward-looking statements include comments about our plans, expectations, and prospects and are based on our view as of today, May 7th, 2020. We disclaim any duty or obligation to update our forward-looking statements to reflect new information after today's call. We will be discussing non-GAAP measures during this call, for which we have provided reconciliations in today's press release and on our website. Our actual results in future periods may differ materially from those currently expected because of the number of risks and uncertainties, including those related to the COVID-19 pandemic and its economic impact. These risks and uncertainties include those outlined in our 10-K, 10-Q, and other filings with the SEC, which you can find on our website or at www.sec.gov. I'll now turn the call over to Comscore's Chief Executive Officer, Bill Livek. Bill?

Thank you, Chris, and thank you, everyone, for joining us today. I'd like to start by addressing the extraordinary environment we are now facing due to a global pandemic. When we last spoke at the end of February, we could not have imagined how rapidly and life-altering the environment would become. As circumstances evolve, we took early action, initiating contingency plans in early March and continuing to monitor the situation on a daily basis. Our employees are safe, secure, and continuing to provide our customers with the products and insights they need to navigate what has become a rapidly evolving media and consumer landscape. Because we are a nimble technology company with a mobile workforce, we transitioned very well to working from home. I'd like to thank all of our employees for their hard work, dedication, and flexibility during this extraordinary time. We have risen to the challenge, and the entire team and our customers are grateful. As a result of our team effort, our data capture, analytics, and product delivery have been largely unaffected. In fact, the situation has created new opportunities for Comscore as we deliver new insights on a shifting media consumption and the rapidly evolving consumer buying habits. We have published many reports over the past few weeks, which have led to robust conversations with our partners about ways to help them understand this changing landscape. We believe the demand for third-party measurement without customer and consumer contact will only increase in this environment. Our results in the quarter reflect the continued product and sales momentum our management team has been building over the past six months. While revenue was lower than anticipated due to the unforeseen impact of COVID in March, and some of our new contracts and renewals and projects being pushed out of the first quarter, our business performed relatively well. We continue to secure new business across all of our verticals with client contracts comparable to the first quarter of last year, with additional momentum in digital wins and solid performance in our traditional TV business. In digital, we signed renewed business with American media, Tribune, and many others. In national TV, we renewed our agreement with a major television station and network group for both our linear TV and video on demand products. In local TV, we earned long-term renewal from Harper Broadcasting, Bonneville International, CoxReps, and Forum Communication, just to name a few. Our momentum continued in the second quarter. Today, we are happy to announce on this call an expanded multi-year partnership with News-Press Gazette (NPG), the owner-operator of 45 television network affiliates across 10 markets. NPG will be using Comscore services to sell its ad inventory, heightening the power and depth of our census-based measurement. While we step back from our 2020 guidance given the uncertainty in the near-term environment, we believe our business performance will improve over the course of the year with revenue increasing through the year, driven in part by political advertising kicking back in and the hard work we put into renewing and expanding client relationships. We believe those will bear fruit. I'm also pleased with our continued focus on expense management. We've told you we would continue to manage expenses sufficiently to grow EBITDA, and that's exactly what we're doing. Going forward, we expect to realize additional efficiencies increasing adjusted EBITDA year-over-year and putting ourselves in a position for 2020 and beyond. Greg will go into this in more detail in the financials. Now I'd like to share how Comscore is adjusting to the current environment to deliver additional critical insight to our clients. The crisis has accelerated the pace of change at Comscore. The speed of delivery has never been more important given the day-to-day changes we're witnessing in consumer behavior. As a result, we've been adapting quickly. Over the past two months, we introduced, what I believe could be potentially game-changing measurement solutions to help our clients more easily navigate the current environment. First, we introduced QuickScore for local TV in over 30 markets, providing viewership insight for local media within 48 hours of broadcast and in some cases even faster. Through the combination of Comscore's massive near-census television footprint and industry-leading advanced television audience demographics, QuickScore delivers a rapid, representative view of local television consumption to help local TV stations proactively manage schedules and make important sales, programming, and promotional decisions more quickly and confidently. Ad agencies also stand to benefit, as the speed of Comscore's information helps them adjust campaigns on the fly, bolstering overall success in this changing viewer environment. In addition, Comscore now offers two new advanced audience segments in our TV service: news viewers by consumption level and heavy viewers of key sports. With live sports currently off the air, we're helping our clients find those coveted viewers with our new segmentation system for non-sports related programming. We believe these key long-term advantages will help expand our capabilities and drive new client wins and pricing enhancements in the future. In our digital suites, we rolled out faster reporting to highlight the rapidly changing media environment. Previously, we reported digital data largely once a month. Now, we're delivering many of these category measurement changes weekly or even daily. Our OTT streaming services, which expands across demographic groups and device types in the United States, is now a daily delivered product. In addition, our gaming service now measures top games across devices in the US on a weekly, and in some cases, daily basis. I believe that after the national emergency ends, these will remain durable product advantages that our customers are willing to pay for. We also see tremendous potential for our digital applications in the expanded e-commerce market. As we all know, traditional retailing has been losing ground to online for over a decade. This trend has accelerated with the pandemic. In what may be a new normal, we expect customers to rely on Comscore to understand consumer buying habits and site performance versus their own site. As you know, our customers know a lot about their consumer from their own information, but they know very little about the competitive landscape. Comscore, in our privacy-compliant measurement system, allows our digital customers to understand how their consumers behave when they're not on their site. In our movie business, we are now more closely aligned with our movie customers than ever before, and they've been hit hard by the shutdown. As moviegoers stay home, we have documented the extraordinary rise in streaming and on-demand viewing. We're helping our customers understand this trend by engaging with our video on demand service to help them understand which movies are being purchased geographically and demographically. As studios plan future releases when theaters reopen, we're also investigating how Comscore may play a role in third-party verification if the content creators and theater owners want to alter their windows and how all parties can be fairly compensated, similar to how studios previously used our video store measurement services. Despite COVID-19, we experienced another strong quarter in movies, securing a renewal with a large global studio and a new agreement with a large digital studio. I have always been excited about our movie business, and I'm more excited about the future than ever before. I'd also like to highlight our COVID-19 information available on our website, where Comscore has been a critical source of helping our customers and prospective customers understand the changing consumer landscape. We have become a daily source for customers wanting to learn how individuals are changing their consumption habits. Taken together, these products provide an unmatched capability to help customers and prospects understand audience migration during this unprecedented period. While the near-term environment is uncertain, our capabilities and our commitments to our customers have never been stronger, and the need for independent third-party measurement we provide has never been more critical. Additionally, I am excited to announce a partnership with LiveRamp to develop new and innovative services in the advertising ecosystem. We will be combining our TV and video measurement solutions for both of our client bases. This partnership leverages Comscore's trusted cross-screen viewer information with LiveRamp's unrivaled identity and data connectivity solutions, including its outcome-based measurement platform, Data Plus Math. This partnership will accelerate the path that the media and advertising industry is already on to create more addressability at scale across any platform and provide better accountability for marketers, better monetization for the sell-side, and more importantly, more relevant customer experiences. LiveRamp has been a valued partner of ours for some time, and we're thrilled to continue collaborating with their team that shares our vision and our goals. We look forward to announcing more details and further collaboration in the near future. I would also like to take a moment to discuss the integration of Comcast households into our local and national footprint. I'm pleased to report that we're making great progress and are on track to integrate Comcast data by year-end, strengthening our already stable and predictive audience ratings and ad impressions. We also look forward to continuing discussions with our existing and prospective clients about how this is a game-changing development here at Comscore. Finally, a few remarks on the strategic review. In our last earnings call, we mentioned that the review was nearing an end. COVID has extended this process, but we continue to evaluate all options to maximize shareholder value. We will update our shareholders when appropriate. Now, I'd like to turn this call over to Greg Fink, our Chief Financial Officer. Greg?

Great. Thank you, Bill. Today, we reported first quarter revenue of $89.5 million compared to $102.3 million reported in the first quarter of last year. While we expected revenue to be lower in the first quarter, revenue was below our expectations, due in part to the current environment, which impacted the timing of closing contracts in March, as well as delayed political revenue and custom projects we expected to recognize. Revenue from ratings and planning in the first quarter was $63.5 million compared to $70.6 million reported in the first quarter of last year. The decrease was largely driven by lower revenue from our syndicated digital and national TV products. While enterprise renewals were strong, syndicated digital revenue declined year-over-year, representing 50% of our ratings and planning revenue in the quarter compared to 51% in the first quarter of 2019. As I discussed in February, we expected syndicated digital to decline early in the year, but remain optimistic that it will stabilize and begin to flatten on a sequential basis later in the year, due in part to our expectation that we will benefit from new business from the exit of some competitors. Our opportunity to acquire those customers in the first quarter was limited, and there was uncertainty regarding when we might expect those contracts to materialize. National TV revenue was lower due to the consolidation of certain customers last year, as well as the delay in political revenue from campaigns that moved out of the quarter, as I mentioned earlier. We expect political revenue to begin in the coming quarter. Local TV revenue continues to grow from new customers and expansion within existing customers. Revenue from analytics and optimization in the first quarter was $15.5 million compared to $21.5 million in the first quarter of last year. The decrease was due to lower sales and deliveries across all of our products in this category. In the quarter, we experienced lower custom projects and were impacted by event cancellations where certain products typically benefit. Movies reporting and analytics revenue for the first quarter was $10.5 million compared to $10.3 million in the prior year. While revenue was essentially flat year-over-year, we do expect theater closures to impact movies revenue throughout the remainder of 2020. Given the uncertainty around when theaters will reopen, we are and we will be working with our customers. Turning to operating costs, our core operating expenses, which include cost of revenues, sales and marketing, R&D, and G&A, declined by $25.3 million year-over-year and $5.2 million on a sequential basis. The significant reduction in operating costs relates to the actions we implemented beginning in the second quarter of 2019 and throughout last year. As such, none of those reductions are reflected in the prior year's first quarter. Cost of revenues decreased by $7.6 million in the first quarter compared to the year-ago quarter, due to lower headcount, data, and professional fees. Selling and marketing expenses declined by over $5.6 million compared to the year-ago quarter, and R&D decreased by $8.1 million from staffing reductions and decreases in all aspects of our cost base. G&A expense for the first quarter decreased by $4 million compared to the prior year quarter from lower headcount. Given these uncertain times, we have taken additional short-term actions to improve our cash position and further reduce costs. We have reduced compensation, instituted a hiring freeze, initiated limited furloughs, and reduced travel and other administrative costs. Currently, we expect these actions to continue through the end of September and reduce our operating expenses by between $2 million and $4 million. We will continue to reevaluate the need to continue with these actions and should uncertainty regarding the advertising environment change, we will shorten or lengthen these actions and if necessary, take further action. In the first quarter, we reported a net loss of $13.2 million compared to a net loss of $27.5 million in the same period last year. The net loss includes a $4.7 million non-cash impairment charge related to our estimate that we will be unable to recover our cost for certain properties currently on the market for lease. For the quarter, adjusted EBITDA was $6.4 million compared to an adjusted EBITDA loss of $2.5 million for the same period last year. Although our revenue was lower year-over-year, the significant improvement in adjusted EBITDA reflects our efforts to reduce costs to a sustainable level at which we can generate positive results on a go-forward basis. Our non-GAAP net loss for the first quarter was $5.8 million, which compares to a non-GAAP net loss of $14.1 million reported in the year-ago quarter. We ended the first quarter with total cash of $56.6 million compared to $66.8 million at December 31. The decrease in cash during the quarter was primarily a result of interest payments on our senior secured convertible notes and term notes. Starting at the end of the first quarter as a result of COVID-19, we began to experience some customer payment delays and requests to modify contractual payment terms. We are working with our customers to navigate through this. Turning to our outlook for 2020, given the pandemic's impacts on our customers and the current uncertainty regarding media industry trends and behavior in the short term, we are withdrawing our prior 2020 outlook. We continue to monitor the COVID-19 pandemic closely, take proactive actions to navigate the environment, and will update stakeholders at the appropriate time. Now, let me turn it back to the operator to take questions.

Your first question comes from the line of Benjy Scurlock with Arete Research.

Hi, thanks for taking the questions. I have two, if I may. First, I was wondering if you could provide a bit more color on the partnership with LiveRamp and the impact it could have on the effectiveness of your addressable measurement and whether this is a short-term impact or if it's a longer-term initiative? And then secondly, I was wondering if you could talk a little bit about the conversations you're having with your clients, given the current environment and how you think you could impact from potential leads for the rest of the year. Any kind of color on that would be helpful. Thanks.

Thank you. LiveRamp, I can't tell you how excited I am. I'm thrilled that we're working with them; they're a great company and they're integral in this new world, particularly in measurement regarding advertising effectiveness. They have a strong schedule, and every customer has their own definition of who their consumer is and the emerging data sets through reliable brands. This deal is going to have an immediate positive impact on our revenue and a long-term positive impact as well. So, I can't express enough how excited I am. In terms of our clients, we've been working closely with all of our clients in all of our verticals, helping them understand how the environment is changing. We're fortunate to have been able to secure long-term contracts with many of our customers, as we're helping them navigate through this evolving situation with their viewers, consumers, and digital users. They are using us to navigate this realm. It's also interesting to note that, on the movie side of the business, even though most movie theaters have been closed around the globe, our customers are still utilizing our services extensively as they're building plans to reopen their releases. So, Comscore is not just a tool they use for real-time measurement; they also use it for planning purposes. Overall, we're in a good position.

Okay, thank you.

Your next question comes from the line of Ryan Vaughan with Needham & Company.

Hi, Bill. Hi, Greg. Thanks for taking my call. A couple of questions for you. One, just to follow up on the movies business. You mentioned that you expect to see some impact through the rest of the year. Could you shed more light on the contractual nature of that business? If there are no theaters open, are there clauses in the contract that specify no payment? Anything you could share on that would be helpful.

On question Number 1, most of our movie contracts are long-term in nature. As we reported for the quarter, before COVID affected us, we had signed up a large digital studio as a new client. Additionally, since COVID hit, we've continued to renew customers, and one of the major studios just renewed with us. Therefore, we're an important strategic tool for them. Clearly, it has been challenging, and we announced a number of additional products that we've integrated into the movie ecosystem over the past year. It's fair to say that it is not business as usual while the world is still adjusting. Selling new products will be difficult for a while, but our base measurement service remains critical and durable, and most of our contracts are long-term in nature.

That's helpful. And then, Greg, nice job on the operating margin improvement. You identified $2 million to $4 million of additional cost cuts to adjust to the new environment. Are there other variable costs we should consider? Regarding 2Q, will working capital change at all, moving it from being a source of capital?

Yes, there are definitely actions we've taken to improve cost efficiency and additional savings over the next few months, as I highlighted. We remain vigilant around expenditures and continuously review all areas, including facilities and other operations, to seek ways to enhance cost efficiency. We talked about this at year-end, and we've seen further improvements on a sequential basis compared to the fourth quarter. So we will continue to look for opportunities while maintaining our focus on keeping our operations effective. Regarding working capital, the first quarter tends to be a little unusual as it includes year-end costs, and you might see fluctuations. Some annual incentive compensation is paid early in the year, which could cause discrepancies in our financial statements for the quarter. As we continue to reduce costs significantly, we should see positive impacts from operating from a lower cost base moving forward.

Great, thanks so much.

And you do have a question from the line of Jim Roumell with Roumell Asset Management.

Quick question on addressable. Can you comment on where you're at with that in terms of engagements with potential clients and which competitors do you feel are well-positioned to roll out addressable products?

Thank you for asking that. Addressable, as we discussed previously, is strategically very important. In the COVID environment, it has not taken priority due to how the advertising landscape has shifted. Looking forward, we're uniquely positioned for a couple of reasons. First, we have comprehensive operator information that is essential for measuring addressable commercials. Our acquisition of Comcast data enhances our capabilities tremendously. There is a significant trend considering how advertisers leverage national spots in local markets, and national addressability could accelerate as television networks may start addressing their commercials to individual households through cable infrastructure. We are set to take advantage of that if it unfolds as anticipated. In terms of our competitive position, we were the pioneers in this space, and addressable has to integrate with linear measurements as well. The census measurement approach we have for both services positions us well compared to others in the industry.

Thank you, Bill.

You're welcome.

And there are no further questions at this time.

Thank you, operator. In closing, we remain optimistic about the future as we manage through this challenging present. I'm very pleased with the progress we have made as a company in the roughly two quarters that I have been honored to serve as your CEO. The important yet difficult cost decisions that Comscore took last year positioned us well to weather this environment and capitalize on the tremendous opportunities ahead. Lastly, on behalf of myself and the entire Comscore team, I would like to send our heartfelt best wishes and a big thank you to the frontline workers in this pandemic, whether they are first responders, healthcare workers, or essential employees. In our small corner of the world at Comscore, we will continue to play our part to help our customers and communities recover from this crisis. Thank you all, and we look forward to sharing our progress in the near term or on the next quarterly call. Thank you very much.

This concludes today's conference call. You may now disconnect.