8-K
Zedge, Inc. (ZDGE)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of theSecurities Exchange Act of 1934
Date of Report (Date of earliest event reported):March 15, 2022
ZEDGE, INC.
(Exact name of registrant as specified in itscharter)
| Delaware | 1-37782 | 26-3199071 |
|---|---|---|
| (State or other jurisdiction<br><br> <br>of incorporation) | (Commission File Number) | (IRS Employer<br><br> <br>Identification No.) |
| 1178 Broadway, Ste 1450 (3rd Floor), New York, NY | 10001 | |
| --- | --- | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including
area code: (330) 577-3424
Not Applicable
(Former name or former address, if changed sincelast report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| --- | --- |
Securities registered pursuant to Section 12(b) of the Act:
| Title of Each Class | Trading Symbol(s) | Name of each exchange on whichregistered |
|---|---|---|
| Class B common stock, par value $0.01 per share | ZDGE | NYSE American |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). ☐
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of Operations and Financial Condition
On March 15, 2022, Zedge, Inc. (the “Registrant”) issued a press release announcing its results of operations for its second fiscal quarter ended January 31, 2022. A copy of the press release issued by the Registrant concerning the foregoing results is furnished herewith as Exhibit 99.1 and is incorporated herein by reference.
The Registrant is furnishing the information contained in this Report, including Exhibit 99.1, pursuant to Item 2.02 of Form 8-K promulgated by the Securities and Exchange Commission (the “SEC”). This information shall not be deemed to be “filed” with the SEC or incorporated by reference into any other filing with the SEC unless otherwise expressly stated in such filing. In addition, this Report and the press release contain statements intended as “forward-looking statements” that are subject to the cautionary statements about forward-looking statements set forth in the press release.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit No | Document |
|---|---|
| 99.1 | Earnings Release, dated March 15, 2022, reporting the results of operations for Zedge, Inc.’s second fiscal quarter ended January 31, 2022. |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
1
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| ZEDGE, INC. | ||
|---|---|---|
| By: | /s/ Jonathan Reich | |
| Name: | Jonathan Reich | |
| Title: | Chief Executive Officer |
Dated: March 15, 2022
2
EXHIBIT INDEX
| Exhibit Number | Document |
|---|---|
| 99.1 | Earnings Release, dated March 15, 2022, reporting the results of operations for Zedge, Inc.’s second fiscal quarter ended January 31, 2022. |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
3
Exhibit 99.1
Zedge Announces Record Second-Quarter Fiscal 2022 Results
Reports 30% revenue growth to a record $6.9 million;Net income of $2.3 million; and record quarterly EBITDA^1^ of $3.4 million
New York, NY – March 15, 2022: Zedge, Inc. (NYSE AMERICAN: ZDGE), a global app publisher with a portfolio of leading digital consumer brands serving 44 million users across the portfolio in January 2022, today announced results for its second-quarter fiscal year 2022 ended January 31, 2022.
“In the second quarter, we executed on the priorities we laid out heading into fiscal 2022 and continued to see strong results despite the tougher comps,” said Jonathan Reich, chief executive officer. “Advertising revenue growth remained robust, while the Zedge App’s monthly active users (MAU)^2^ expanded to over 36 million with average revenue per MAU (ARPMAU)^2^ increasing to a record $0.06. In addition, Zedge Premium gross transaction value (GTV)^2^ increased by 106%.
“New product and feature development, especially those that we believe will drive growth in well-developed markets remains a central focus of ours, however, we did have to temporarily re-allocate resources to migrate to a new ad mediation platform following Applovin’s acquisition of and imminent closing down of the MoPub platform. We remain on track to finalize this migration by the end of the month, but some of the remaining social and community features in development will rollout slightly later than originally expected. Nonetheless, we continue forging forward with ‘NFTs Made Easy’ by focusing on expanding the offering to more artists and introducing additional features and capabilities to build out the ecosystem. In addition, we’re planning on reviewing the user-onboarding experience with the goal of improving engagement.
“Finally, as I’ve talked about previously, our Innovation Team is working on new product development, targeting up to three ‘proofs of concept’ per quarter. Some of these are expected to scale into full-fledged offerings in the future,” continued Reich.
Fiscal Second-Quarter Highlights (Fiscal 2022versus Fiscal 2021)
| ● | Revenue increased 30.1% to $6.9 million versus $5.3 million; | ||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| ● | Active subscriptions and subscription revenue increased 7.2% and 17.8%, respectively; | ||||||||||||||||||
| --- | --- | ||||||||||||||||||
| ● | Operating income and operating margin of $3.1 million and 44.9% versus $2.5 million and 47.4%, respectively; | ||||||||||||||||||
| --- | --- | ||||||||||||||||||
| ● | Net income and diluted EPS of $2.3 million and $0.16 versus $2.3 million and $0.17, respectively; | ||||||||||||||||||
| --- | --- | ||||||||||||||||||
| ● | Cash flow from operations increased 31.3% to a record $3.0 million versus $2.3 million; | ||||||||||||||||||
| --- | --- | ||||||||||||||||||
| ● | EBITDA increased 16.0% to $3.4 million versus $2.9 million; | ||||||||||||||||||
| --- | --- | ||||||||||||||||||
| ● | MAU*^2^* increased by 2.5%; | ||||||||||||||||||
| --- | --- | ||||||||||||||||||
| ● | Zedge Premium GTV increased 105.7% to $0.43 million. | ||||||||||||||||||
| --- | --- | ||||||||||||||||||
| Select Financial Metrics: Q2 Fiscal 2022 versus Fiscal 2021 as of 1/31/22* | |||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |
| (in $M except for EPS) | Q2 ’22 | Q2 ’21 | Change | YTD 2022 | YTD 2021 | Change | |||||||||||||
| Total Revenue | $ | 6.9 | $ | 5.3 | 30.1 | % | $ | 12.9 | $ | 9.1 | 42.6 | % | |||||||
| Advertising Revenue | $ | 5.4 | $ | 4.4 | 23.6 | % | $ | 10.0 | $ | 7.4 | 35.5 | % | |||||||
| Subscription Revenue | $ | 1.0 | $ | 0.8 | 17.8 | % | $ | 1.9 | $ | 1.5 | 31.1 | % | |||||||
| Other Revenue | $ | 0.5 | $ | 0.1 | 395.3 | % | $ | 1.0 | $ | 0.2 | 341.4 | % | |||||||
| Operating Income | $ | 3.1 | $ | 2.5 | 23.4 | % | $ | 5.7 | $ | 3.6 | 57.7 | % | |||||||
| Operating Margin | 44.9 | % | 47.4 | % | 44.0 | % | 39.8 | % | |||||||||||
| Net Income | $ | 2.3 | $ | 2.3 | 2.0 | % | $ | 4.4 | $ | 3.3 | 31.8 | % | |||||||
| Diluted Earnings Per Share | $ | 0.16 | $ | 0.17 | -5.9 | % | $ | 0.29 | $ | 0.26 | 11.5 | % | |||||||
| EBITDA | $ | 3.4 | $ | 2.9 | 15.9 | % | $ | 6.4 | $ | 4.3 | 46.9 | % | |||||||
| Cash Flow from Operations | $ | 3.0 | $ | 2.3 | 31.3 | % | $ | 5.7 | $ | 3.8 | 51.0 | % | |||||||
| Zedge Premium - Gross Transaction Value (GTV) | $ | 0.43 | $ | 0.21 | 105.7 | % | $ | 0.76 | $ | 0.42 | 82.1 | % | |||||||
| * | numbers may not add due to rounding | ||||||||||||||||||
| --- | --- | ||||||||||||||||||
| Select Business Metrics: 2nd Quarter Fiscal 2022 versus Fiscal 2021* | |||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | ||||||||||||
| (in MM except for ARPMAU and where noted) | Q2 ’22 | Q2 ’21 | Change | ||||||||||||||||
| Total Installs - Cumulative | 541.0 | 482.0 | 12.2 | % | |||||||||||||||
| MAU | 36.3 | 35.4 | 2.5 | % | |||||||||||||||
| Well-developed Markets | 8.5 | 9.5 | -10.5 | % | |||||||||||||||
| Emerging Markets | 27.8 | 25.9 | 7.3 | % | |||||||||||||||
| ARPMAU | $ | 0.060 | $ | 0.049 | 22.2 | % | |||||||||||||
| Active Subscriptions (in 000s) | 762 | 711 | 7.2 | % | |||||||||||||||
| * | numbers may not add due to rounding | ||||||||||||||||||
| --- | --- | ||||||||||||||||||
| ^1^ | Throughout this release, EBITDA is a Non-GAAP financial measureintended to provide useful information that supplements Zedge’s results in accordance with GAAP. Please refer to the Reconciliationof Non-GAAP Financial Measure at the end of this release for an explanation of Zedge’s formulation of EBITDA and reconciliationsto the most directly comparable GAAP measure. | ||||||||||||||||||
| --- | --- | ||||||||||||||||||
| ^2^ | We use the following business metrics in this release becausewe believe they are useful in evaluating Zedge as an investment. | ||||||||||||||||||
| --- | --- | ||||||||||||||||||
| ● | Monthly active users, or MAU, captures the number of uniqueusers that used our Zedge App during the previous 30-days of the relevant period, is useful for evaluating consumer engagement with ourapp which correlates to advertising revenue as more users drive more ad impressions for sale. It also allows readers and potential advertisersto evaluate the size of our user base. | ||||||||||||||||||
| --- | --- | ||||||||||||||||||
| ● | Zedge Premium Gross Transaction Value, or GTV, is thetotal dollar amount of transactions conducted through the Zedge Premium Marketplace. As Zedge Premium is an internal focus for growth,we believe that this metric will help investors evaluate the progress we are making in growing this part of our business. | ||||||||||||||||||
| --- | --- | ||||||||||||||||||
| ● | Average Revenue Per Monthly Active User for our Zedgeapp, or ARPMAU, is a useful statistic in evaluating how well we are monetizing our user base. | ||||||||||||||||||
| --- | --- | ||||||||||||||||||
| ● | An Active Subscriptions is a subscription that has commencedand not been canceled, including paused subscriptions, and subscriptions in free trials, grace periods, or account hold. | ||||||||||||||||||
| --- | --- | ||||||||||||||||||
| ● | Total Installs - Cumulative is a measure of the cumulativenumber of times our Zedge app has been downloaded since inception. | ||||||||||||||||||
| --- | --- | ||||||||||||||||||
| Trended Financial Information* | |||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| (in $M except for EPS, ARPMAU, Paid Subscriptions) | Q121 | Q221 | Q321 | Q421 | Q122 | Q222 | FY 2020 | FY 2021 | YTD FY 2022 | ||||||||||
| Total Revenue | $ | 3.8 | $ | 5.3 | $ | 5.3 | $ | 5.2 | $ | 6.0 | $ | 6.9 | $ | 9.5 | $ | 19.6 | $ | 12.9 | |
| Advertising Revenue | $ | 3.0 | $ | 4.4 | $ | 4.3 | $ | 4.2 | $ | 4.6 | $ | 5.4 | $ | 7.4 | $ | 15.7 | $ | 10.0 | |
| Subscription Revenue | $ | 0.7 | $ | 0.8 | $ | 0.9 | $ | 1.0 | $ | 1.0 | $ | 1.0 | $ | 1.6 | $ | 3.2 | $ | 1.9 | |
| Other Revenue | $ | 0.1 | $ | 0.1 | $ | 0.1 | $ | 0.2 | $ | 0.5 | $ | 0.5 | $ | 0.5 | $ | 0.5 | $ | 1.0 | |
| Operating (loss) Income | $ | 1.1 | $ | 2.5 | $ | 2.0 | $ | 2.2 | $ | 2.6 | $ | 3.1 | $ | (0.4 | ) | $ | 7.8 | $ | 5.7 |
| Net (loss) Income | $ | 1.0 | $ | 2.3 | $ | 2.4 | $ | 2.5 | $ | 2.1 | $ | 2.3 | $ | (0.6 | ) | $ | 8.2 | $ | 4.4 |
| Diluted Earnings (Loss) Per Share | $ | 0.08 | $ | 0.17 | $ | 0.17 | $ | 0.17 | $ | 0.14 | $ | 0.16 | (0.05 | ) | $ | 0.59 | $ | 0.30 | |
| EBITDA | $ | 1.4 | $ | 2.9 | $ | 2.3 | $ | 2.7 | $ | 3.0 | $ | 3.4 | $ | 1.0 | $ | 9.3 | $ | 6.4 | |
| Cash Flow from Operations | $ | 1.5 | $ | 2.3 | $ | 4.0 | $ | 2.4 | $ | 2.7 | $ | 3.0 | $ | 2.1 | $ | 10.1 | $ | 5.7 | |
| Zedge Premium – GTV | $ | 0.21 | $ | 0.21 | $ | 0.25 | $ | 0.27 | $ | 0.33 | $ | 0.43 | $ | 0.73 | $ | 0.95 | $ | 0.76 | |
| MAU | 32.4 | 35.4 | 34.5 | 34.4 | 34.2 | 36.3 | nm | nm | nm | ||||||||||
| Well-developed Markets | 9.2 | 9.5 | 8.9 | 8.5 | 8.4 | 8.5 | nm | nm | nm | ||||||||||
| Emerging Markets | 23.2 | 25.9 | 25.6 | 25.9 | 25.8 | 27.8 | nm | nm | nm | ||||||||||
| ARPMAU | $ | 0.036 | $ | 0.049 | $ | 0.049 | $ | 0.050 | $ | 0.053 | $ | 0.060 | nm | nm | nm | ||||
| Active<br> Subscriptions (in 000s) | 609 | 711 | 753 | 752 | 763 | 762 | 504 | 752 | 762 |
nm = not measurable/meaningful
| * | numbers may not<br> add due to rounding |
|---|
Fiscal 2022 Commentary
“Given the impending switch to a new ad mediation platform, we believe it is prudent to remain very conservative and reiterate our prior guidance of 25-30% revenue growth, operating margins above 40% and EBITDA growth in excess of revenue growth, even though our year to date numbers significantly exceed these rates. We expect to provide an update when we report third quarter earnings.
“While users in Russia and Belarus are immaterial to our revenue, I want to commend our team in Lithuania for the outstanding effort they have made in the face of conflict since the invasion of Ukraine. They have remained strong and have regularly volunteered and assisted their neighbors impacted by the war, and we will continue to support their efforts, including changing our logo to the colors of the Ukrainian flag to reflect our opposition to the aggression. Finally, we developed a set of contingency plans to enable business continuity in the event hostilities spill over into or close to Lithuania. It is our sincere hope that a cease fire is agreed to imminently and that Ukrainians can resume a peaceful life,” concluded Reich.
2
Earnings Announcement and Supplemental Information
Zedge’s earnings release will be filed on Form 8-K and posted on the Zedge investor relations website (https://investor.zedge.net) at approximately 4:10 p.m. Eastern on March 15, 2022. Management will host an earnings conference call beginning at 4:30 p.m. Eastern. Management’s presentation of the results, outlook and strategy will be followed by Q&A with investors.
To participate in the call, please dial Toll Free: 877-545-0320 or International: 973-528-0002, at least five minutes before the 4:30PM Eastern start. Please ask for the Zedge earnings conference call with Participant Access Code: 244501
The call will also be webcast through the Zedge investor relations website: https://investor.zedge.net and will be available through March 15, 2023.
Following the call and continuing through Tuesday, March 29, 2022, a call replay will be available by dialing Toll Free: 877-481-4010 or International: 919-882-2331 and entering the replay access code: 44792
About Zedge
Zedge is an app publisher that owns a portfolio of leading digital consumer brands serving 44 million users globally in January 2022. Our portfolio consists of Zedge Ringtones and Wallpapers, the leading mobile app used for mobile phone personalization, social content, and fandom art; Zedge Premium, a marketplace for artists, celebrities, and emerging creators to market their digital content, to Zedge’s users; Emojipedia, the leading source of all things emoji; and Shortz, a mobile entertainment app in beta, focused on short-form storytelling. Zedge monetizes its content through ad-supported offerings, tokens, and subscriptions. For more information, visit https://www.zedge.net.
Forward-Looking Statements
All statements above that are not purely about historicalfacts, including, but not limited to, those in which we use the words “believe,” “anticipate,” “expect,”“plan,” “intend,” “estimate,” “target” and similar expressions, are forward-looking statementswithin the meaning of the Private Securities Litigation Reform Act of 1995. While these forward-looking statements represent our currentjudgment of what may happen in the future, actual results may differ materially from the results expressed or implied by these statementsdue to numerous important factors. Our filings with the SEC provide detailed information on such statements and risks and should be consultedalong with this release. To the extent permitted under applicable law, we assume no obligation to update any forward-looking statements.
Contact:
Brian Siegel IRC, MBA
Senior Managing Director
Hayden IR
(346) 396-8696
ir@zedge.net
3
CONDENSED CONSOLIDATED BALANCESHEETS
(in thousands, except parvalue data)
| July 31, | |||||
|---|---|---|---|---|---|
| 2021 | |||||
| Assets | |||||
| Current assets: | |||||
| Cash and cash equivalents | 30,016 | $ | 24,908 | ||
| Trade accounts receivable, net of allowance of 0 at January 31, 2022 and July 31, 2021 | 3,241 | 2,545 | |||
| Prepaid expenses | 285 | 111 | |||
| Other current assets | 108 | 49 | |||
| Total current assets | 33,650 | 27,613 | |||
| Property and equipment, net | 1,770 | 1,980 | |||
| Intangible assets, net | 6,488 | - | |||
| Goodwill | 2,228 | 2,262 | |||
| Deferred tax assets, net | 527 | 477 | |||
| Other assets | 318 | 5,145 | |||
| Total assets | 44,981 | $ | 37,477 | ||
| Liabilities and stockholders’ equity | |||||
| Current liabilities: | |||||
| Trade accounts payable | 417 | $ | 585 | ||
| Due to seller of Emojipedia | 1,879 | - | |||
| Accrued expenses and other current liabilities | 2,769 | 1,771 | |||
| Deferred revenues | 1,782 | 1,821 | |||
| Total current liabilities | 6,847 | 4,177 | |||
| Other liabilities | 96 | 145 | |||
| Total liabilities | 6,943 | 4,322 | |||
| Commitments and contingencies (Note 8) | |||||
| Stockholders’ equity: | |||||
| Preferred stock, .01 par value; authorized shares—2,400; no shares issued | - | - | |||
| Class A common stock, .01 par value; authorized shares—2,600; 525 shares issued and outstanding at January 31, 2022 and July 31, 2021 | 5 | 5 | |||
| Class B common stock, .01 par value; authorized shares—40,000; 13,949 shares issued and 13,875 shares outstanding at January 31, 2022, and 13,923 shares issued and 13,865 ouststanding at July 31, 2021 | 139 | 139 | |||
| Additional paid-in capital | 42,479 | 41,664 | |||
| Accumulated other comprehensive loss | (1,077 | ) | (997 | ) | |
| Accumulated deficit | (3,174 | ) | (7,554 | ) | |
| Treasury stock, 74 shares at January 31, 2022 and 58 shares at July 31, 2021, at cost | (334 | ) | (102 | ) | |
| Total Stockholders’ equity | 38,038 | 33,155 | |||
| Total liabilities and Stockholders’ equity | 44,981 | $ | 37,477 |
All values are in US Dollars.
4
ZEDGE,INC.
CONDENSED CONSOLIDATED STATEMENTSOF OPERATIONS AND COMPREHENSIVE INCOME
(in thousands, except pershare data)
| Three Months Ended | Six Months Ended | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| January 31, | January 31, | |||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||
| Revenues | $ | 6,915 | $ | 5,314 | $ | 12,943 | $ | 9,076 | ||
| Costs and expenses: | ||||||||||
| Direct cost of revenues (excluding amortization of capitalized software and technology development costs which is included below) | 342 | 313 | 652 | 617 | ||||||
| Selling, general and administrative | 3,106 | 2,159 | 5,838 | 4,165 | ||||||
| Depreciation and amortization | 360 | 324 | 758 | 683 | ||||||
| Income from operations | 3,107 | 2,518 | 5,695 | 3,611 | ||||||
| Interest and other income, net | 14 | 5 | 27 | 5 | ||||||
| Net (loss) gain resulting from foreign exchange transactions | (85 | ) | 74 | (95 | ) | 34 | ||||
| Income before income taxes | 3,036 | 2,597 | 5,627 | 3,650 | ||||||
| Provision for income taxes | 711 | 319 | 1,247 | 327 | ||||||
| Net Income | 2,325 | 2,278 | 4,380 | 3,323 | ||||||
| Other comprehensive (loss) income: | ||||||||||
| Changes in foreign currency translation adjustment | (222 | ) | 365 | (80 | ) | 206 | ||||
| Total other comprehensive (loss) income | (222 | ) | 365 | (80 | ) | 206 | ||||
| Total comprehensive income | $ | 2,103 | $ | 2,643 | $ | 4,300 | $ | 3,529 | ||
| Income per share attributable to Zedge, Inc. common stockholders: | ||||||||||
| Basic | $ | 0.16 | $ | 0.18 | $ | 0.31 | $ | 0.27 | ||
| Diluted | $ | 0.16 | $ | 0.17 | $ | 0.29 | $ | 0.26 | ||
| Weighted-average number of shares used in calculation of income per share: | ||||||||||
| Basic | 14,297 | 12,633 | 14,289 | 12,412 | ||||||
| Diluted | 14,971 | 13,431 | 15,007 | 12,949 |
5
ZEDGE, INC.
CONDENSED CONSOLIDATED STATEMENTSOF CASH FLOWS
(in thousands)
| Six Months Ended | ||||||
|---|---|---|---|---|---|---|
| January 31, | ||||||
| 2022 | 2021 | |||||
| Operating activities | ||||||
| Net income | $ | 4,380 | $ | 3,323 | ||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||
| Depreciation and amortization | 758 | 683 | ||||
| Stock-based compensation | 808 | 389 | ||||
| Deferred income taxes | (50 | ) | - | |||
| Change in assets and liabilities: | ||||||
| Trade accounts receivable | (741 | ) | (1,500 | ) | ||
| Prepaid expenses and other current assets | (244 | ) | 156 | |||
| Other assets | 1 | 36 | ||||
| Trade accounts payable and accrued expenses | 806 | 299 | ||||
| Deferred revenue | (39 | ) | 375 | |||
| Net cash provided by operating activities | 5,679 | 3,761 | ||||
| Investing activities | ||||||
| Capitalized software and technology development costs and purchase of equipment | (323 | ) | (401 | ) | ||
| Net cash used in investing activities | (323 | ) | (401 | ) | ||
| Financing activities | ||||||
| Proceeds from sales of Class B Common Stock | - | 5,000 | ||||
| Payment of issuance costs | - | (215 | ) | |||
| Repayment of insurance premium loan payable | - | (100 | ) | |||
| Proceeds from exercise of stock options | 7 | 396 | ||||
| Purchase of treasury stock in connection with restricted stock vesting | (232 | ) | (26 | ) | ||
| Net cash (used in) provided by financing activities | (225 | ) | 5,055 | |||
| Effect of exchange rate changes on cash and cash equivalents | (23 | ) | 82 | |||
| Net increase in cash and cash equivalents | 5,108 | 8,497 | ||||
| Cash and cash equivalents at beginning of period | 24,908 | 5,111 | ||||
| Cash and cash equivalents at end of period | $ | 30,016 | $ | 13,608 | ||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | ||||||
| Cash payments made for income taxes | $ | 309 | $ | 1 | ||
| Cash payments made for interest expenses | $ | - | $ | 2 | ||
| SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES | ||||||
| Acquistion of Emojipedia through release of escrow funds of $4,776, due to seller of $1,923 and legal fee of $12 | $ | 6,711 | $ | - | ||
| Accounts receivable from certain Emojipedia websites collected by Seller | $ | 45 | $ | - | ||
| Note payable issued for insurance premium financing | $ | - | $ | 181 |
6
Use of EBITDA as a Non-GAAP Measure
EBITDA is defined as earnings (loss) before interest, taxes, depreciation and amortization. EBITDA represents a measure that we believe is customarily used by investors and analysts to evaluate the financial performance of companies in addition to the GAAP measures that we present. Our management also believes that EBITDA is useful in evaluating our core operating results. However, EBITDA is not a measure of financial performance under accounting principles generally accepted in the United States of America and should not be considered an alternative to net income or operating income as an indicator of our operating performance or to net cash provided by operating activities as a measure of our liquidity.
| Reconciliation of EBITDA to Net Income (Loss) | Q121 | Q221 | Q321 | Q421 | Q122 | Q222 | FY<br><br> 2020 | FY<br><br> 2021 | YTD FY 2022 | ||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Net Income (Loss) | $ | 1.0 | $ | 2.3 | $ | 2.4 | $ | 2.5 | $ | 2.1 | $ | 2.3 | ($ | 0.6 | ) | $ | 8.2 | $ | 4.4 | ||||||||
| Excluding: | |||||||||||||||||||||||||||
| Interest and other income (expense), net | $ | (0.0 | ) | $ | (0.0 | ) | $ | (0.0 | ) | $ | (0.0 | ) | $ | (0.0 | ) | $ | (0.0 | ) | $ | (0.0 | ) | $ | (0.0 | ) | $ | (0.0 | ) |
| Provision for (benefit from) income taxes | $ | 0.0 | $ | 0.3 | $ | (0.5 | ) | $ | (0.1 | ) | $ | 0.5 | $ | 0.7 | $ | 0.0 | $ | (0.2 | ) | $ | 1.2 | ||||||
| Depreciation and amortization | $ | 0.4 | $ | 0.3 | $ | 0.3 | $ | 0.3 | $ | 0.4 | $ | 0.4 | $ | 1.6 | $ | 1.3 | $ | 0.8 | |||||||||
| EBITDA | $ | 1.4 | $ | 2.9 | $ | 2.3 | $ | 2.7 | $ | 3.0 | $ | 3.4 | $ | 1.0 | $ | 9.3 | $ | 6.4 | |||||||||
| * | numbers may not add due to rounding | ||||||||||||||||||||||||||
| --- | --- |
7