Marchex(MCHX)

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Comparative Analysis of Financial Efficiency Among Tech Companies
Financial Modeling Prepยท 2025-09-23 15:00
Company Analysis - Marchex, Inc. has a Return on Invested Capital (ROIC) of -15.82% and a Weighted Average Cost of Capital (WACC) of 12.69%, indicating it is not generating returns above its cost of capital, which is a concerning sign for investors [1] - comScore, Inc. shows a ROIC of -22.54% with a WACC of 5.57%, resulting in a ROIC to WACC ratio of -4.05, highlighting significant inefficiencies in generating returns relative to its cost of capital, indicating potential financial struggles [2] - Liquidity Services, Inc. has a ROIC of 10.21% and a WACC of 8.71%, leading to a ROIC to WACC ratio of 1.17, indicating it is generating returns above its cost of capital, making it the most efficient among its peers and an attractive option for investors [3]
Marchex Announces Executive Team Updates
Businesswireยท 2025-09-16 20:15
Executive Team Changes - Edwin Miller, CEO, is stepping down and will serve as a senior advisor to the Chairman [1][2] - Troy Hartless has been appointed as President in addition to his role as Chief Revenue Officer [1] - Francis Feeney has been appointed Chief Operating Officer alongside his role as Chief Corporate and Legal Affairs Officer [1] - Brian Nagle has been appointed Chief Financial Officer, previously serving as Senior Vice President, Controller [1] Company Growth and Strategy - Marchex is positioned for future growth with a focus on AI-driven product offerings and operational efficiencies [2] - The company aims to expand customer penetration and grow its addressable market through a growing portfolio of AI products [2] - The leadership transition is seen as a strategic move to capitalize on increasing opportunities and the company's evolution [2] Financial Performance - Marchex reported GAAP revenue of $11.7 million for Q2 2025, a decrease from $12.1 million in Q2 2024 [8]
Marchex(MCHX) - 2025 Q2 - Quarterly Report
2025-08-13 20:16
[PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section details Marchex's unaudited financial statements, management's analysis, market risk disclosures, and internal controls [Item 1. Consolidated Financial Statements (Unaudited)](index=4&type=section&id=Item%201.%20Consolidated%20Financial%20Statements%20(Unaudited)) Marchex's unaudited consolidated financial statements, encompassing balance sheets, operations, equity, cash flows, and detailed notes, are presented [Consolidated Balance Sheets (Unaudited)](index=4&type=section&id=Consolidated%20Balance%20Sheets%20(Unaudited)) Total assets and equity slightly decreased by June 30, 2025, driven by reduced cash and increased accumulated deficit | Metric | June 30, 2025 (in Thousands) | December 31, 2024 (in Thousands) | | :-------------------------- | :--------------------------- | :--------------------------- | | Total Assets | $41,984 | $43,200 | | Cash and Cash Equivalents | $10,491 | $12,767 | | Total Liabilities | $9,941 | $10,567 | | Total Stockholders' Equity | $32,043 | $32,633 | | Accumulated Deficit | $(328,075) | $(326,178) | [Consolidated Statements of Operations (Unaudited)](index=5&type=section&id=Consolidated%20Statements%20of%20Operations%20(Unaudited)) Marchex achieved **net income of $85 thousand** for Q2 2025, improving from a prior-year loss, but reported a **$1.9 million net loss** for the six months Three Months Ended June 30 | Metric | 2025 (in Thousands) | 2024 (in Thousands) | Change | | :------------------------------------------ | :------------------ | :------------------ | :----- | | Revenue | $11,655 | $12,074 | -$419 (-3.5%) | | Net Income (Loss) applicable to common stockholders | $85 | $(756) | +$841 | | Basic and diluted net income (loss) per share | $0.00 | $(0.02) | +$0.02 | Six Months Ended June 30 | Metric | 2025 (in Thousands) | 2024 (in Thousands) | Change | | :------------------------------------------ | :------------------ | :------------------ | :----- | | Revenue | $23,058 | $23,646 | -$588 (-2.5%) | | Net Income (Loss) applicable to common stockholders | $(1,897) | $(2,206) | +$309 | | Basic and diluted net income (loss) per share | $(0.04) | $(0.05) | +$0.01 | [Consolidated Statements of Stockholders' Equity (Unaudited)](index=6&type=section&id=Consolidated%20Statements%20of%20Stockholders'%20Equity%20(Unaudited)) Total stockholders' equity decreased to **$32.0 million** by June 30, 2025, primarily due to the net loss, partially offset by stock-based compensation | Metric | December 31, 2024 (in Thousands) | June 30, 2025 (in Thousands) | | :------------------------------------------ | :------------------------------- | :----------------------------- | | Total Stockholders' Equity | $32,633 | $32,043 | | Stock-based compensation (six months ended) | N/A | $1,011 | | Net loss (six months ended March 31, 2025) | N/A | $(1,982) | | Net income (three months ended June 30, 2025) | N/A | $85 | [Consolidated Statements of Cash Flows (Unaudited)](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows%20(Unaudited)) Cash used in operating activities decreased to **$1.8 million** for H1 2025, with **$0.5 million** used in investing and **$0.1 million** generated from financing Six Months Ended June 30 (in Thousands) | Cash Flow Activity | 2025 | 2024 | | :-------------------------------- | :----- | :----- | | Net cash from (used in) operating activities | $(1,819) | $(2,361) | | Net cash from (used in) investing activities | $(542) | $(81) | | Net cash from (used in) financing activities | $85 | $(188) | | Cash and cash equivalents at end of period | $10,491 | $11,977 | - Cash used in investing activities for **2025** was primarily attributable to software development costs for new products[89](index=89&type=chunk) [Notes to Consolidated Financial Statements (Unaudited)](index=8&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements%20(Unaudited)) These notes provide detailed information supporting the consolidated financial statements, covering business description, accounting policies, revenue recognition, segment reporting, concentrations, fair value measurements, equity, earnings per share, property and equipment, leases, commitments, taxes, and a domain asset sale [Note 1: Description of Business and Basis of Presentation](index=8&type=section&id=Note%201:%20Description%20of%20Business%20and%20Basis%20of%20Presentation) Marchex is a conversation intelligence company leveraging AI and data analytics to provide actionable insights for B2B2C vertical markets - Marchex is an AI-powered conversational intelligence company focused on providing actionable insights for operational excellence and revenue acceleration in B2B2C vertical markets[21](index=21&type=chunk) - The company is assessing the impact of **ASU 2023-09** (Improvements to Income Tax Disclosures, effective after Dec **15, 2024**) and **ASU 2025-01** (Disaggregation of Income Statement Expenses, effective after Dec **15, 2026**) on its financial statement disclosures[26](index=26&type=chunk)[27](index=27&type=chunk) [Note 2: Revenue Recognition](index=9&type=section&id=Note%202:%20Revenue%20Recognition) Marchex generates revenue from its AI-powered conversational analytics platform by charging fees for call/text data elements or tracked phone numbers, recognized over time - Revenue is generated from fees for call/text related data elements or per phone number tracked, based on pre-negotiated rates, and recognized over time as services are provided[28](index=28&type=chunk) Accounts Receivable, Net (in Thousands) | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------ | :---------------- | | Billed | $5,937 | $5,420 | | Unbilled | $1,657 | $1,736 | | Allowance for expected credit losses | $(33) | $(84) | | **Accounts receivable, net** | **$7,561** | **$7,072** | Deferred Revenue (in Thousands) | Metric | Amount | | :-------------------------- | :----- | | Balance at December 31, 2024 | $1,093 | | Deferral of revenue | $438 | | Revenue earned from deferred revenue | $(725) | | **Balance at June 30, 2025** | **$806** | [Note 3: Segment Reporting and Geographic Information](index=10&type=section&id=Note%203:%20Segment%20Reporting%20and%20Geographic%20Information) Marchex operates as a single segment focused on conversational analytics and related solutions. The vast majority of its revenue (98-99%) and long-lived assets are derived from and located in the United States - The Company operates in a single segment comprised of its conversational analytics and related solutions[30](index=30&type=chunk) Revenues by Geographic Region (Percentages) | Region | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :-------------------- | :------------------------------- | :----------------------------- | | United States | 98% | 99% | | Canada and other countries | 2% | 1% | | Total | 100% | 100% | [Note 4: Concentrations](index=10&type=section&id=Note%204:%20Concentrations) Marchex has significant customer concentration, with one customer (Customer A) accounting for **11%** of consolidated revenue for both the three and six months ended June 30, 2025, and **21%** of consolidated accounts receivable Customer A Revenue Concentration (Percentages) | Period | 2025 | 2024 | | :-------------------------- | :--- | :--- | | Three Months Ended June 30 | 11% | 10% | | Six Months Ended June 30 | 11% | 11% | Accounts Receivable Concentration (Percentages) as of June 30, 2025 | Concentration Type | Percentage | | :------------------------ | :--------- | | Customer A | 21% | | Independent dealer network A | 14% | [Note 5: Fair Value of Financial Instruments](index=11&type=section&id=Note%205:%20Fair%20Value%20of%20Financial%20Instruments) The carrying values of Marchex's financial instruments, including cash and cash equivalents, accounts receivable, accounts payable, and accrued liabilities, approximate their fair values due to their liquidity and short-term nature Cash and Cash Equivalents (in Thousands) | Metric | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Cash | $5,308 | $7,615 | | Money market funds | $5,183 | $5,152 | | **Total** | **$10,491** | **$12,767** | [Note 6: Stockholders' Equity](index=11&type=section&id=Note%206:%20Stockholders'%20Equity) Marchex authorized a new share repurchase program in May 2025 for up to **3.0 million** Class B common shares, though no repurchases have been made - A new share repurchase program was authorized in May **2025** for up to **3,000,000** shares of Class B common stock; no repurchases have been made under this or prior programs as of June **30, 2025**[34](index=34&type=chunk)[173](index=173&type=chunk) Total Stock-based Compensation Expense (in Thousands) | Period | 2025 | 2024 | | :-------------------------- | :--- | :--- | | Three Months Ended June 30 | $556 | $437 | | Six Months Ended June 30 | $1,011 | $870 | - As of June **30, 2025**, unrecognized compensation costs related to stock options were **$2.3 million** (expected to be recognized over **2.28 years**) and for restricted stock were **$0.7 million** (expected over **0.78 years**)[38](index=38&type=chunk) [Note 7: Net Income (Loss) Per Share](index=12&type=section&id=Note%207:%20Net%20Income%20(Loss)%20Per%20Share) Marchex computes net income (loss) per share using the two-class method, allocating undistributed income/losses proportionately between Class A and Class B common shares, which have identical dividend rights Basic Net Income (Loss) Per Share (Three Months Ended June 30) | Class | 2025 EPS | 2024 EPS | | :---- | :------- | :------- | | Class A | $0.00 | $(0.02) | | Class B | $0.00 | $(0.02) | Diluted Net Income (Loss) Per Share (Three Months Ended June 30) | Class | 2025 EPS | 2024 EPS | | :---- | :------- | :------- | | Class A | $0.00 | $(0.02) | | Class B | $0.00 | $(0.02) | Basic Net Loss Per Share (Six Months Ended June 30) | Class | 2025 EPS | 2024 EPS | | :---- | :------- | :------- | | Class A | $(0.04) | $(0.05) | | Class B | $(0.04) | $(0.05) | [Note 8: Property and Equipment](index=14&type=section&id=Note%208:%20Property%20and%20Equipment) Net property and equipment decreased slightly to **$1.7 million** at June 30, 2025, with **$0.7 million** in depreciation for the six months Property and Equipment, Net (in Thousands) | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------ | :---------------- | | Computer and other related equipment | $1,229 | $1,198 | | Purchased software | $3,276 | $3,276 | | Furniture and fixtures | $262 | $262 | | Software development costs | $144 | โ | | Software development costs - in progress | $510 | $72 | | Less: accumulated depreciation and amortization | $(3,685) | $(2,997) | | **Property and equipment, net** | **$1,736** | **$1,811** | Depreciation and Amortization Expense (in Thousands) | Period | 2025 | 2024 | | :-------------------------- | :--- | :--- | | Three Months Ended June 30 | $335 | $309 | | Six Months Ended June 30 | $713 | $618 | [Note 9: Leases](index=15&type=section&id=Note%209:%20Leases) Marchex maintains an operating lease for its corporate office and terminated an office lease in Wichita, Kansas, during Q2 2025 - The company terminated an operating lease for office space in Wichita, Kansas, during the second quarter of **2025**[46](index=46&type=chunk) Total Lease Cost (in Thousands) | Period | 2025 | 2024 | | :-------------------------- | :--- | :--- | | Three Months Ended June 30 | $144 | $161 | | Six Months Ended June 30 | $308 | $337 | Future Lease Payments as of June 30, 2025 (in Thousands) | Year | Operating Leases | Finance Leases | | :--- | :--------------- | :------------- | | 2025 | $190 | $191 | | 2026 | $397 | โ | | 2027 and thereafter | $380 | โ | | **Gross future lease payments** | **$967** | **$191** | [Note 10: Commitments and Contingencies](index=16&type=section&id=Note%2010:%20Commitments%20and%20Contingencies) Marchex has contractual obligations totaling **$8.5 million**, primarily for outside service providers, and is involved in ongoing litigation Future Minimum Payments on Other Contractual Obligations (in Thousands) | Year | Amount | | :---------------- | :----- | | 2025 | $2,069 | | 2026 | $4,798 | | 2027 | $1,668 | | 2028 | $13 | | 2029 and thereafter | โ | | **Total minimum payments** | **$8,548** | - The company is a defendant in litigation filed October **21, 2022**, by Telmetrics, Inc. shareholders, asserting claims for an earnout of up to **$3.0 million** and **$1.0 million** from an escrow agreement related to a **2018** acquisition[53](index=53&type=chunk) [Note 11: Taxes](index=17&type=section&id=Note%2011:%20Taxes) Marchex maintains a **100% valuation allowance** against most deferred tax assets due to historical losses and is evaluating new tax legislation - A **100%** valuation allowance is recorded against gross deferred tax assets as of June **30, 2025**, and December **31, 2024**, due to historical taxable losses and uncertainty of future taxable income[55](index=55&type=chunk)[86](index=86&type=chunk) Income Tax Expense (in Thousands) | Period | 2025 | 2024 | | :-------------------------- | :--- | :--- | | Three Months Ended June 30 | $5 | $3 | | Six Months Ended June 30 | $114 | $62 | - The 'One Big Beautiful Bill Act,' signed July **4, 2025**, includes changes allowing more favorable deductibility of R&D expenditures, **100%** bonus depreciation, and favorable business interest expense rules starting in **2025**[57](index=57&type=chunk) [Note 12: Domain Asset Sale](index=17&type=section&id=Note%2012:%20Domain%20Asset%20Sale) In April 2025, Marchex sold a domain asset for **$0.8 million**, recognizing a **$0.6 million gain** in Q2 2025 - In April **2025**, a domain asset was sold for **$0.8 million**, yielding approximately **$0.7 million** in net cash proceeds after a **15%** commission fee[58](index=58&type=chunk) - Approximately **$0.6 million** was recognized as a gain in Q2 **2025**, and **$48.2K** will be recognized as interest income over the **four-year** payment period due to the financing component[58](index=58&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=18&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on Marchex's financial performance, liquidity, and capital resources, detailing revenue and expense trends [Overview](index=18&type=section&id=Overview) Marchex leverages AI and data analytics to provide actionable insights, optimize customer journeys, and accelerate revenue for B2B2C brands - Marchex harnesses AI and conversational intelligence to provide actionable insights, driving operational excellence and revenue acceleration for B2B2C vertical markets[60](index=60&type=chunk) - The company's mission is to create intelligence around all types of business conversations and be a leader in vertical market conversational intelligence leveraging generative AI and data analytics[61](index=61&type=chunk) [Components of the Results of our Operations](index=19&type=section&id=Components%20of%20the%20Results%20of%20our%20Operations) This section outlines the primary drivers of Marchex's financial results, including revenue, cost of revenue, and various operating expenses [Revenue](index=19&type=section&id=Revenue) Marchex generates most revenue from its AI-powered conversational analytics platform, charging fees for call/text data elements or tracked phone numbers - The majority of revenue is generated from AI-powered conversational intelligence product offerings[63](index=63&type=chunk) - Revenue is recognized when customers pay a fee for call/text related data elements or for each phone number tracked, based on a pre-negotiated rate, and is recognized over time as services are performed[63](index=63&type=chunk) [Cost of Revenue](index=19&type=section&id=Cost%20of%20Revenue) Cost of revenue primarily consists of telecommunication costs, bandwidth, software license fees, network operations, and personnel expenses - Cost of revenue includes telecommunication costs, bandwidth and software license fees, network operations, and payroll and related expenses of personnel, including stock-based compensation[65](index=65&type=chunk) [Sales and Marketing](index=19&type=section&id=Sales%20and%20Marketing) Sales and marketing expenses mainly comprise payroll, advertising, promotional expenditures, customer systems costs, and stock-based compensation - Sales and marketing expenses consist primarily of payroll and related expenses for personnel, advertising and promotional expenditures, costs of systems, and stock-based compensation[66](index=66&type=chunk) [Product Development](index=19&type=section&id=Product%20Development) Product development costs include expenses for research, development, and enhancement of products and services, with eligible costs capitalized - Product development costs primarily consist of payroll and related expenses for personnel, costs of computer hardware and software, and stock-based compensation[67](index=67&type=chunk) - Product development costs are expensed as incurred or capitalized into property and equipment in accordance with U.S. GAAP[68](index=68&type=chunk) [General and Administrative](index=19&type=section&id=General%20and%20Administrative) General and administrative expenses cover payroll for executive/administrative personnel, professional services, bad debt provisions, and facilities costs - General and administrative expenses consist primarily of payroll and related expenses for executive and administrative personnel, professional services, bad debt provisions, facilities costs, and stock-based compensation[69](index=69&type=chunk) [Stock-Based Compensation](index=19&type=section&id=Stock-Based%20Compensation) Stock-based compensation cost is measured at grant date fair value and recognized as expense over the vesting or service period using the straight-line method - Stock-based compensation cost is measured at grant date fair value and recognized as expense over the vesting or service period using the straight-line method[70](index=70&type=chunk) - Forfeitures are accounted for as they occur, and the expense is included in the same lines as compensation paid to the same employees in the Consolidated Statements of Operations[70](index=70&type=chunk) [Amortization of Intangibles from Acquisitions](index=19&type=section&id=Amortization%20of%20Intangibles%20from%20Acquisitions) Amortization of intangible assets from acquisitions ceased in 2025 as these assets were fully amortized by December 31, 2024 - Intangible assets from acquisitions (customer relationships, acquired technology, non-competition agreements, trade names) were fully amortized by December **31, 2024**[71](index=71&type=chunk) - Consequently, there was no amortization expense for these assets in **2025**[71](index=71&type=chunk)[84](index=84&type=chunk) [Provision for Income Taxes](index=20&type=section&id=Provision%20for%20Income%20Taxes) Marchex uses the asset and liability method for income taxes, with the effective tax rate differing from **21%** due to valuation allowance and non-deductible compensation - The company uses the asset and liability method of accounting for income taxes, recognizing deferred tax assets and liabilities[72](index=72&type=chunk) - The effective tax rate differed from the expected **21%** primarily due to the valuation allowance and non-deductible stock-based compensation[85](index=85&type=chunk) [Results of Operations](index=20&type=section&id=Results%20of%20Operations) This section details Marchex's financial performance for the three and six months ended June 30, 2025, showing revenue declines but improved operating loss [Revenue](index=21&type=section&id=Revenue_Results) Revenue decreased by **3% to $11.7 million** for the three months and **2% to $23.1 million** for the six months ended June 30, 2025 Revenue (in Thousands) | Period | 2025 | 2024 | Change | | :-------------------------- | :----- | :----- | :----- | | Three Months Ended June 30 | $11,655 | $12,074 | -$419 (-3%) | | Six Months Ended June 30 | $23,058 | $23,646 | -$588 (-2%) | - Revenue decrease was impacted by lower call volumes, customer corporate development activities, customer migration revenue dilution, and the current uncertain macroeconomic environment (including new federal tariffs)[75](index=75&type=chunk) [Expenses](index=21&type=section&id=Expenses_Results) Overall operating expenses decreased for both periods, primarily due to reduced product development costs and cessation of acquisition-related amortization [Cost of Revenue](index=21&type=section&id=Cost%20of%20Revenue_Expenses) Cost of revenue decreased by **2% to $4.1 million** for the three months and **3% to $8.3 million** for the six months ended June 30, 2025 Cost of Revenue (in Thousands) | Period | 2025 | 2024 | % of Revenue 2025 | % of Revenue 2024 | Change | | :-------------------------- | :----- | :----- | :---------------- | :---------------- | :----- | | Three Months Ended June 30 | $4,058 | $4,152 | 35% | 34% | -$0.1M (-2%) | | Six Months Ended June 30 | $8,246 | $8,566 | 36% | 36% | -$0.3M (-3%) | - The decrease was primarily attributable to a decrease in costs from personnel and outside labor due to reorganization and realignment in **2025**[76](index=76&type=chunk)[77](index=77&type=chunk) [Sales and Marketing](index=21&type=section&id=Sales%20and%20Marketing_Expenses) Sales and marketing expenses increased by **19% to $3.2 million** for the three months and **16% to $6.4 million** for the six months ended June 30, 2025 Sales and Marketing Expenses (in Thousands) | Period | 2025 | 2024 | % of Revenue 2025 | % of Revenue 2024 | Change | | :-------------------------- | :----- | :----- | :---------------- | :---------------- | :----- | | Three Months Ended June 30 | $3,165 | $2,742 | 27% | 23% | +$0.5M (+19%) | | Six Months Ended June 30 | $6,431 | $5,529 | 28% | 23% | +$0.9M (+16%) | - The increase was primarily attributable to higher payroll and benefit related charges, contract asset amortization charges, and depreciation charges[78](index=78&type=chunk)[79](index=79&type=chunk) [Product Development](index=22&type=section&id=Product%20Development_Expenses) Product development expenses decreased significantly by **22% to $2.5 million** for the three months and **20% to $5.2 million** for the six months ended June 30, 2025 Product Development Expenses (in Thousands) | Period | 2025 | 2024 | % of Revenue 2025 | % of Revenue 2024 | Change | | :-------------------------- | :----- | :----- | :---------------- | :---------------- | :----- | | Three Months Ended June 30 | $2,501 | $3,223 | 21% | 26% | -$0.7M (-22%) | | Six Months Ended June 30 | $5,173 | $6,468 | 23% | 28% | -$1.3M (-20%) | - The change was primarily attributable to lower personnel and outside labor costs due to the capitalization of software development costs and personnel reorganization in **2025**[80](index=80&type=chunk)[81](index=81&type=chunk) [General and Administrative](index=22&type=section&id=General%20and%20Administrative_Expenses) General and administrative expenses remained flat at **$2.5 million** for Q2 2025 but increased by **17% to $5.6 million** for the six months General and Administrative Expenses (in Thousands) | Period | 2025 | 2024 | % of Revenue 2025 | % of Revenue 2024 | Change | | :-------------------------- | :----- | :----- | :---------------- | :---------------- | :----- | | Three Months Ended June 30 | $2,457 | $2,528 | 21% | 21% | Unchanged | | Six Months Ended June 30 | $5,604 | $4,817 | 24% | 20% | +$0.8M (+17%) | - The increase for the six months was primarily attributable to higher payroll costs, largely one-time reorganization charges, and the timing of professional services costs[83](index=83&type=chunk) [Amortization of Intangible Assets from Acquisitions](index=22&type=section&id=Amortization%20of%20Intangible%20Assets%20from%20Acquisitions_Expenses) Amortization expense for intangible assets from acquisitions was **$0** for both periods, as these assets were fully amortized by end of 2024 Amortization of Intangible Assets from Acquisitions (in Thousands) | Period | 2025 | 2024 | | :-------------------------- | :--- | :--- | | Three Months Ended June 30 | $0 | $151 | | Six Months Ended June 30 | $0 | $301 | - Intangible assets acquired from acquisitions reached the end of their useful lives during **2024**, resulting in no amortization expense in **2025**[71](index=71&type=chunk)[84](index=84&type=chunk) [Income Tax](index=22&type=section&id=Income%20Tax_Expenses) Income tax expense was minimal for both periods, primarily deferred tax and U.S. state income taxes, with a full valuation allowance impacting the effective rate Income Tax Expense (in Thousands) | Period | 2025 | 2024 | | :-------------------------- | :--- | :--- | | Three Months Ended June 30 | $5 | $3 | | Six Months Ended June 30 | $114 | $62 | - The effective tax rate differed from the expected **21%** primarily due to a full valuation allowance and non-deductible stock-based compensation[85](index=85&type=chunk) [Liquidity and Capital Resources](index=22&type=section&id=Liquidity%20and%20Capital%20Resources) Cash and cash equivalents decreased to **$10.5 million** at June 30, 2025, with **$1.8 million** used in operating activities Cash and Cash Equivalents (in Millions) | Date | Amount | | :---------------- | :----- | | June 30, 2025 | $10.5 | | December 31, 2024 | $12.8 | Cash Flow Activities (Six Months Ended June 30, in Millions) | Activity | 2025 | 2024 | | :-------------------- | :--- | :--- | | Operating Activities | $(1.8) | $(2.4) | | Investing Activities | $(0.5) | $(0.1) | | Financing Activities | $0.1 | $(0.2) | - Management believes current resources will be sufficient to fund operations for at least **twelve months**, but additional equity and debt financing may be needed to support acquisition strategy and long-term obligations[91](index=91&type=chunk) [Critical Accounting Policies](index=23&type=section&id=Critical%20Accounting%20Policies) Marchex's financial statements conform to U.S. GAAP, relying on estimates, with no significant changes in critical accounting policies during H1 2025 - Financial statements are prepared in conformity with U.S. GAAP, requiring management to make estimates and assumptions[92](index=92&type=chunk)[93](index=93&type=chunk) - No significant changes in critical accounting policies and estimates occurred during the three and six months ended June **30, 2025**[94](index=94&type=chunk) [Recent Accounting Pronouncements Not Yet Effective](index=23&type=section&id=Recent%20Accounting%20Pronouncements%20Not%20Yet%20Effective) This section refers to Note 1 for details on recent accounting pronouncements not yet effective, including ASUs on income tax and expense disclosures - Refer to Note **1**: Description of Business and Basis of Presentation for details on recent accounting pronouncements not yet effective[95](index=95&type=chunk) [Website](index=23&type=section&id=Website) Marchex's website provides access to SEC filings and investor relations, utilizing social media for material information disclosure - The company's website, www.marchex.com, provides access to annual, quarterly, and current reports filed with the SEC[96](index=96&type=chunk) - Marchex uses its investor relations website, press releases, SEC filings, public conference calls, webcasts, and social media channels (X, Company Blog, LinkedIn) to disclose material financial information[96](index=96&type=chunk)[97](index=97&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=24&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) Marchex is not required to provide quantitative and qualitative disclosures about market risk as a smaller reporting company - Marchex is not required to provide quantitative and qualitative disclosures about market risk as a smaller reporting company[98](index=98&type=chunk) [Item 4. Controls and Procedures](index=24&type=section&id=Item%204.%20Controls%20and%20Procedures) Officers concluded Marchex's disclosure controls were effective as of June 30, 2025, with no material changes to internal controls [Evaluation of Disclosure Controls and Procedures](index=24&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) Marchex's disclosure controls and procedures were concluded to be effective as of June 30, 2025, based on officer evaluation - The principal executive officer and principal financial officer concluded that disclosure controls and procedures were effective as of June **30, 2025**[99](index=99&type=chunk) [Changes in Internal Control over Financial Reporting](index=24&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) No material changes to internal controls over financial reporting occurred during the three and six months ended June 30, 2025 - No changes were made to internal controls over financial reporting during the three and six months ended June **30, 2025**, that materially affected or are reasonably likely to materially affect them[100](index=100&type=chunk) [Limitations on the Effectiveness of Controls](index=24&type=section&id=Limitations%20on%20the%20Effectiveness%20of%20Controls) Management acknowledges inherent limitations in controls, meaning they cannot provide absolute assurance or detect all misstatements - Management acknowledges that controls cannot provide absolute assurance and that internal controls over financial reporting may not prevent or detect all misstatements due to inherent limitations[101](index=101&type=chunk)[102](index=102&type=chunk) [PART II. OTHER INFORMATION](index=25&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section details Marchex's legal proceedings, comprehensive risk factors, equity transactions, and other required disclosures [Item 1. Legal Proceedings](index=25&type=section&id=Item%201.%20Legal%20Proceedings) Information regarding legal proceedings, including ongoing litigation from a 2018 acquisition, is detailed in Note 10 - Information regarding legal proceedings is provided in Note **10**: Commitments and Contingencies of the Notes to Consolidated Financial Statements[105](index=105&type=chunk) [Item 1A. Risk Factors](index=25&type=section&id=Item%201A.%20Risk%20Factors) This section outlines various financial, strategic, operational, legal, compliance, and general risks that could materially and adversely affect Marchex's business [FINANCIAL RISKS](index=25&type=section&id=FINANCIAL%20RISKS) Key financial risks include Marchex's history of net losses, significant customer concentration, and the need for additional funding - Marchex had an accumulated deficit of **$328.1 million** as of June **30, 2025**, and may incur net losses in the foreseeable future[107](index=107&type=chunk) - The five largest customers accounted for approximately **35%** of total revenues for both the three and six months ended June **30, 2025**, posing a risk if one or more are lost[110](index=110&type=chunk) - Quarterly results may fluctuate due to seasonality, with call volumes generally higher in spring/summer and lower in late Q4[115](index=115&type=chunk) [STRATEGIC RISKS](index=27&type=section&id=STRATEGIC%20RISKS) Strategic risks include intense competition, slower market development for conversational analytics, evolving business strategy, and acquisition risks - Marchex operates in a highly competitive and rapidly changing market, facing competition from companies like Twilio, Invoca, and Google, requiring continuous product enhancement[119](index=119&type=chunk)[120](index=120&type=chunk) - The market for conversational analytics solutions may develop more slowly than expected, which could harm the business[121](index=121&type=chunk) - Acquisitions involve risks such as diversion of management's attention, ownership dilution, decreased earnings, integration difficulties, and potential for unknown liabilities[123](index=123&type=chunk)[124](index=124&type=chunk) [OPERATIONAL RISKS](index=28&type=section&id=OPERATIONAL%20RISKS) Operational risks include challenges in securing phone numbers, system vulnerabilities, cybersecurity threats, and reliance on third-party providers - Dependence on securing sufficient phone numbers and associated telecommunication services, subject to FCC rules and carrier requirements, including new registration fees and screening technologies[127](index=127&type=chunk)[128](index=128&type=chunk) - Technical systems and operations are vulnerable to damage or interruption from various events (e.g., natural disasters, cyber-attacks), potentially causing service disruptions and data loss[129](index=129&type=chunk)[130](index=130&type=chunk) - Reliance on third-party cloud providers, hardware/software vendors, telecommunications carriers, and other service providers, where a failure or limitation could adversely affect business and reputation[132](index=132&type=chunk)[133](index=133&type=chunk) [LEGAL AND COMPLIANCE RISKS](index=30&type=section&id=LEGAL%20AND%20COMPLIANCE%20RISKS) Legal and compliance risks involve protecting IP, potential liabilities for customer activities, third-party IP claims, and evolving telecommunications/data privacy regulations - Inability to protect intellectual property rights (patents, trademarks, copyrights, trade secrets) could adversely affect competitive position[135](index=135&type=chunk)[137](index=137&type=chunk)[138](index=138&type=chunk) - Potential liabilities for customer activities, such as improper sending of text messages or voice calls, under consumer protection laws like the TCPA[140](index=140&type=chunk) - Exposure to federal, state, and foreign telecommunications and data privacy regulations, including TCPA, STIR/SHAKEN, call recording consent laws, GDPR, CPRA, and potential new AI regulations, which could increase compliance costs and risks[147](index=147&type=chunk)[148](index=148&type=chunk)[149](index=149&type=chunk)[150](index=150&type=chunk)[151](index=151&type=chunk) [GENERAL RISKS](index=35&type=section&id=GENERAL%20RISKS) General risks include macroeconomic conditions, climate change, personnel retention, stock volatility, founder's voting control, and anti-takeover provisions - Operating results are susceptible to general economic conditions (e.g., labor shortages, inflation, tariffs), climate change, natural catastrophic events, and public health crises[156](index=156&type=chunk)[157](index=157&type=chunk)[158](index=158&type=chunk) - The company is heavily dependent on its senior management and key personnel; loss or difficulty in attracting/retaining them could harm operations[159](index=159&type=chunk)[160](index=160&type=chunk) - The trading prices of Class B common stock have been and are likely to continue to be highly volatile[163](index=163&type=chunk)[164](index=164&type=chunk) - The founder beneficially owns **100%** of Class A common stock, representing **75%** of voting power, which could control corporate actions and adversely affect the price of Class B common stock[168](index=168&type=chunk)[169](index=169&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=38&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Marchex established a new share repurchase program for up to **3.0 million** Class B common shares, with no repurchases made in H1 2025 - The **2025** Repurchase Program authorizes the repurchase of up to **3,000,000** shares of Class B common stock[173](index=173&type=chunk) - No share repurchases were made under this program or any superseded program during the three and six months ended June **30, 2025**[173](index=173&type=chunk) [Item 4. Mine Safety Disclosures](index=38&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to Marchex, Inc - This item is not applicable to the Registrant[174](index=174&type=chunk) [Item 5. Other Information](index=38&type=section&id=Item%205.%20Other%20Information) No directors or executive officers adopted or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements in H1 2025 - No directors or officers adopted or terminated Rule **10b5-1** or non-Rule **10b5-1** trading arrangements during the three and six months ended June **30, 2025**[175](index=175&type=chunk) [Item 6. Exhibits](index=39&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including officer certifications and Inline XBRL documents - Exhibits include certifications of the Principal Executive Officer (**31.1**) and Principal Financial Officer (**31.2**), a certification pursuant to **18** U.S.C. Section **1350** (**32**), and Inline XBRL documents (**101.INS, 101.SCH, 104**)[177](index=177&type=chunk) [Signature](index=40&type=section&id=Signature) The report was signed by Brian Nagle, Senior Vice President, Controller, on behalf of Marchex, Inc. on August 13, 2025 - The report was signed by Brian Nagle, Senior Vice President, Controller (Principal Financial Officer and Principal Accounting Officer) on August **13, 2025**[183](index=183&type=chunk)
Marchex (MCHX) Surpasses Q2 Earnings Estimates
ZACKSยท 2025-08-12 22:40
Company Performance - Marchex reported quarterly earnings of $0.02 per share, surpassing the Zacks Consensus Estimate of a loss of $0.01 per share, representing an earnings surprise of +300.00% [1] - The company posted revenues of $11.66 million for the quarter ended June 2025, missing the Zacks Consensus Estimate by 6.31% and down from $12.07 million year-over-year [2] - Over the last four quarters, Marchex has only surpassed consensus EPS estimates once and has not beaten consensus revenue estimates [2] Stock Movement and Outlook - Marchex shares have increased approximately 12.6% since the beginning of the year, outperforming the S&P 500's gain of 8.4% [3] - The future performance of the stock will largely depend on management's commentary during the earnings call and the company's earnings outlook [3][4] - The current consensus EPS estimate for the upcoming quarter is -$0.01 on revenues of $12.93 million, and for the current fiscal year, it is -$0.06 on revenues of $49.88 million [7] Industry Context - The Internet - Services industry, to which Marchex belongs, is currently ranked in the top 40% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Marchex's stock performance [5][6]
Marchex(MCHX) - 2025 Q2 - Earnings Call Transcript
2025-08-12 22:00
Financial Data and Key Metrics Changes - Revenue for Q2 2025 was $11.7 million, an increase from $11.4 million in Q1 2025, driven by new sales and upsells despite some offsets due to migration activities to the new Marchex Engage platform [9] - Cash increased to $10.5 million from $10 million at the end of Q1 2025, with expectations for stable to favorable cash balances in Q3 2025 [10] - The company reported positive net income of approximately $100,000 for Q2 2025 [10] Business Line Data and Key Metrics Changes - The company launched the Marchex Engage platform, which is expected to drive future growth through new user interfaces and AI solutions [4][5] - The Engage platform integrates AI-driven conversation intelligence, focusing on vertical markets such as automotive, healthcare, and home services [5][6] Market Data and Key Metrics Changes - The company noted that new federal tariffs on imports have adversely impacted various industries, including automotive and auto services, creating increased uncertainty in the market [11] - The current macroeconomic environment has also introduced challenges, affecting customer behavior and revenue predictability [11] Company Strategy and Development Direction - Marchex is focused on expanding its market opportunities through partnerships with Fortune 500 companies and launching innovative products [4][6] - The company aims to leverage first-party data and AI insights to enhance customer engagement and drive measurable outcomes [6][7] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by migration activities and macroeconomic factors, which may delay achieving annual revenue and adjusted EBITDA goals for 2025 [11][12] - Despite these challenges, the leadership team remains optimistic about executing their strategic plan and believes they are well-positioned for future growth [13] Other Important Information - The company anticipates that both revenue and adjusted EBITDA will sequentially increase in Q3 2025 compared to Q2 2025, with adjusted EBITDA potentially increasing by more than 50% [10] - The migration to the new Engage platform is mostly completed, but it has short-term revenue impacts due to timing and product utilization [11] Q&A Session Summary Question: Did bookings improve sequentially in the second quarter? - Management confirmed that sales or ACV was sequentially higher [18] Question: Any comments on the pipeline? - Management highlighted the progress with the Engage platform and upcoming product launches, which are expected to drive growth [19][20] Question: How is the demand for your service use case versus sales? - Management noted increasing average revenue per sale associated with the Engage platform and expressed excitement about expanding channel opportunities [23][24]
Marchex(MCHX) - 2025 Q2 - Quarterly Results
2025-08-12 20:20
[Marchex Second Quarter 2025 Results](index=1&type=section&id=Marchex%20Announces%20Second%20Quarter%202025%20Results) Marchex reported improved Q2 2025 profitability despite a slight revenue decrease, driven by strategic platform migration and operational efficiency [Q2 2025 Financial Highlights](index=1&type=section&id=Q2%202025%20Financial%20Highlights) Marchex reported a slight revenue decrease in Q2 2025 but achieved profitability with improved net income and Adjusted EBITDA Q2 2025 Financial Performance | Financial Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | GAAP Revenue | $11.7 million | $12.1 million | | Net Income (Loss) | $0.1 million | ($0.8 million) | | Diluted EPS | $0.00 | ($0.02) | | Adjusted EBITDA | $0.6 million | $0.3 million | | Adjusted Non-GAAP EPS | $0.02 | ($0.01) | [Management Commentary](index=1&type=section&id=Management%20Commentary) Management views 2025 as an inflection point, highlighting significant Adjusted EBITDA improvement and strategic platform migration for future growth - The company views **2025** as a potential inflection point, accelerating investment into growth initiatives[4](index=4&type=chunk) - Quarterly Adjusted EBITDA, excluding reorganization costs, improved by **nearly $1 million** compared to Q1 2025[4](index=4&type=chunk) - The migration of **over 1,000 customers** to the new Engage platform is largely complete. While this has short-term revenue impacts, it is a key foundation for the company's plan to **exceed $100 million** in annualized revenue over time[7](index=7&type=chunk)[9](index=9&type=chunk) [Business Outlook and Strategic Initiatives](index=1&type=section&id=Business%20Outlook%20and%20Strategic%20Initiatives) Marchex anticipates sequential growth in Q3 2025 and is expanding its product suite and partnerships, despite expected delays in annual run rate goals [Financial Outlook for 2025](index=1&type=section&id=Financial%20Outlook%20for%202025) Marchex forecasts sequential growth in Q3 2025 revenue and Adjusted EBITDA, but anticipates a Q4 decline and delayed annual run rate goals - Q3 2025 Outlook: Both Revenue and Adjusted EBITDA are expected to increase sequentially compared to Q2 2025, with Adjusted EBITDA potentially growing by **more than 50%**[5](index=5&type=chunk) - Q4 2025 Outlook: Revenue and Adjusted EBITDA are expected to be sequentially lower than Q3 2025[6](index=6&type=chunk) - Annual 2025 goals for Revenue and Adjusted EBITDA run rates are expected to be delayed due to customer migration issues, seasonality, and macroeconomic factors, including new federal tariffs[6](index=6&type=chunk)[9](index=9&type=chunk) [2025 Business Update and Recent Strategic Product and Operational Expansion](index=2&type=section&id=2025%20Business%20Update%20and%20Recent%20Strategic%20Product%20and%20Operational%20Expansion) Marchex is strategically expanding in 2025 through new product launches, key partnerships, and channel development to drive future gross margin expansion - Expanded a multi-year partnership with FordDirect, providing its Engage for Sales and Service product to **over 3,000** franchised dealers[10](index=10&type=chunk) - Launched new AI-powered conversational intelligence solutions specifically for the Health Care industry, designed to deliver compliant operational intelligence from patient conversations[10](index=10&type=chunk) - Initiated channel expansion by launching its first product on the Microsoft Azure Marketplace and AppSource to reach a broader enterprise audience[10](index=10&type=chunk) - Marchex Engage for Auto Sales and Service won the **"2025 AI Agent Product of the Year Award"** from TMC[14](index=14&type=chunk) [Additional New Growth Initiatives Planned for 2025](index=3&type=section&id=Additional%20New%20Growth%20Initiatives%20Planned%20for%202025) The company plans to significantly expand its AI-powered product suite in 2025 with new launches including AI Benchmarking, AgentAI Optimizer, and Marchex GPT - Upcoming product launches include: * **AI Benchmarking**: To provide industry-specific sales and marketing insights from customer conversations * **AgentAI Optimizer**: To prescriptively analyze the performance of third-party AI agents * **Marchex GPT**: A large language model enabling businesses to search their own structured data[14](index=14&type=chunk) [Financial Statements](index=6&type=section&id=Financial%20Statements) The company's Q2 2025 financial statements show improved net income and a stable balance sheet with decreased liabilities [Consolidated Statements of Operations](index=6&type=section&id=Consolidated%20Statements%20of%20Operations) Marchex's Q2 2025 consolidated statements of operations show a revenue decrease but improved loss from operations and a positive net income Consolidated Statements of Operations (In Thousands) | (In Thousands) | Q2 2025 | Q2 2024 | 6 Months 2025 | 6 Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Revenue | $11,655 | $12,074 | $23,058 | $23,646 | | Total operating expenses | $12,191 | $12,796 | $25,464 | $25,681 | | Loss from operations | ($536) | ($722) | ($2,406) | ($2,035) | | Net income (loss) | $85 | ($756) | ($1,897) | ($2,206) | [Consolidated Balance Sheets](index=7&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2025, Marchex's balance sheet shows a slight decrease in total assets and liabilities, with stable stockholders' equity Consolidated Balance Sheets (In Thousands) | (In Thousands) | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $10,491 | $12,767 | | Total current assets | $21,095 | $22,278 | | Total assets | $41,984 | $43,200 | | Total current liabilities | $8,732 | $9,267 | | Total liabilities | $9,941 | $10,567 | | Total stockholders' equity | $32,043 | $32,633 | [Non-GAAP Financial Measures and Reconciliations](index=4&type=section&id=Non-GAAP%20Financial%20Measures%20and%20Reconciliations) Marchex provides non-GAAP financial measures like Adjusted EBITDA and Adjusted non-GAAP EPS to offer clearer insights into core operating performance [Definition of Non-GAAP Measures](index=4&type=section&id=Definition%20of%20Non-GAAP%20Measures) Marchex defines non-GAAP measures, including Adjusted EBITDA and Adjusted non-GAAP income per share, to provide insights into core operating performance - **Adjusted EBITDA** is defined as net income (loss) before interest, income taxes, amortization of intangible assets from acquisitions, depreciation and amortization, stock-based compensation, and acquisition/disposition-related costs[19](index=19&type=chunk) - **Adjusted non-GAAP income (loss) per share** represents net income (loss) adjusted for the net of tax effects of stock-based compensation, acquisition/disposition costs, amortization of intangible assets from acquisitions, and net interest income/expense[20](index=20&type=chunk) [Reconciliation of Net Income (Loss) to Adjusted EBITDA](index=8&type=section&id=Reconciliation%20of%20Net%20Income%20(Loss)%20to%20Adjusted%20EBITDA) Marchex reconciled its Q2 2025 GAAP net income to Adjusted EBITDA, showing a significant increase compared to the prior year Reconciliation of Net Income (Loss) to Adjusted EBITDA (In Thousands) | (In Thousands) | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net income (loss) | $85 | ($756) | | Adjustments | $563 | $1,007 | | **Adjusted EBITDA** | **$648** | **$251** | [Reconciliation of Net Income (Loss) per Share to Adjusted Non-GAAP Income (Loss) per Share](index=9&type=section&id=Reconciliation%20of%20Net%20Income%20(Loss)%20per%20Share%20to%20Adjusted%20Non-GAAP%20Income%20(Loss)%20per%20Share) The company reconciled its Q2 2025 diluted GAAP EPS to Adjusted Non-GAAP income per share, reflecting a positive shift from the prior year Reconciliation of Net Income (Loss) per Share to Adjusted Non-GAAP Income (Loss) per Share | Per Share | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Diluted net income (loss) per share (GAAP) | $0.00 | ($0.02) | | Stock-based compensation | $0.01 | $0.01 | | Interest income (expense) and other, net | $0.01 | $0.00 | | **Adjusted non-GAAP income (loss) per share** | **$0.02** | **($0.01)** |
Marchex(MCHX) - 2025 Q1 - Quarterly Report
2025-05-14 20:15
Revenue Performance - Revenue decreased by $0.2 million, or 2%, to $11.4 million for the three months ended March 31, 2025, compared to $11.6 million for the same period in 2024[72]. Cost and Expenses - Cost of revenue decreased by $0.2 million, or 5%, to $4.2 million for the three months ended March 31, 2025, representing 37% of revenue compared to 38% in 2024[73]. - Sales and marketing expenses increased by $0.5 million, or 18%, to $3.3 million for the three months ended March 31, 2025, accounting for 29% of revenue compared to 24% in 2024[74]. - Product development expenses decreased by $0.5 million, or 16%, to $2.7 million for the three months ended March 31, 2025, representing 24% of revenue compared to 28% in 2024[75]. - General and administrative expenses increased by $0.8 million, or 35%, to $3.1 million for the three months ended March 31, 2025, making up 27% of revenue compared to 20% in 2024[76]. - Total operating expenses increased to $13.3 million, or 116% of revenue, for the three months ended March 31, 2025, compared to $12.9 million, or 111% of revenue, in 2024[71]. Cash Flow and Financial Position - Cash used in operating activities was $2.6 million during the three months ended March 31, 2025, compared to $2.5 million for the same period in 2024[81]. - Cash and cash equivalents decreased to $10.0 million as of March 31, 2025, down from $12.8 million as of December 31, 2024[80]. - Cash used in investing activities was $0.3 million for the three months ended March 31, 2025, primarily for software development costs for new products[82]. - The company believes its resources will be sufficient to fund operations for at least twelve months, but additional financing may be needed for strategic initiatives[84]. Accounting and Compliance - No significant changes in critical accounting policies and estimates during Q1 2025 compared to the previous year[87]. - The company continues to prepare its financial statements in accordance with U.S. GAAP, focusing on estimates and assumptions that impact reported amounts[86]. - Investors can access financial reports and updates through the company's website and social media channels, ensuring compliance with Regulation Fair Disclosure[89].
Marchex(MCHX) - 2025 Q1 - Earnings Call Transcript
2025-05-13 22:02
Financial Data and Key Metrics Changes - Revenue for Q1 2025 was $11.4 million, impacted by seasonal call traffic factors and timing of new sales [13] - Gross margin increased by approximately 8% compared to Q1 2023, indicating improved financial efficiency [6] - The company anticipates achieving over $12.5 million in quarterly revenue by the end of 2025, translating to an annualized revenue run rate of $50 million or better [14] Business Line Data and Key Metrics Changes - The company has consolidated its technology stack into a single cloud-based architecture, enhancing operational efficiency and product offerings [5] - The launch of the Engage for Service product aims to boost revenue for auto service departments, which handle about 50% of inbound calls [8] - Marchex has exclusive access to approximately 9,000 auto franchise dealerships, expanding its market footprint [9] Market Data and Key Metrics Changes - The company is strategically positioned in four core verticals: auto, auto services, home services, and healthcare, with plans to deepen its presence in these markets [7] - The partnership with Microsoft through the Cloud AI Partner Program allows Marchex's solutions to reach a broader enterprise audience via Azure [10] Company Strategy and Development Direction - Marchex aims to scale into a $100 million annual revenue business by launching innovative AI-driven solutions and broadening sales channels [17] - The focus for 2025 is on acceleration, leveraging first-party conversational data to drive innovative solutions for Fortune 500 businesses [17] Management's Comments on Operating Environment and Future Outlook - Management acknowledges uncertainty due to the macroeconomic climate but remains optimistic about the company's current momentum and growth potential [14][15] - The company is confident in its ability to drive sustainable growth and deliver value to customers and shareholders [18] Other Important Information - Marchex has adopted a new share repurchase program and sold an unused domain, indicating proactive financial management [16] Q&A Session Summary - There were no questions during the Q&A session, indicating a lack of immediate inquiries from participants [19]
Marchex(MCHX) - 2025 Q1 - Earnings Call Transcript
2025-05-13 22:02
Financial Data and Key Metrics Changes - Revenue for Q1 2025 was $11.4 million, impacted by seasonal call traffic factors and timing of new sales, but expected to benefit overall financial plan for 2025 [13] - Gross margin increased by approximately 8% compared to Q1 2023, indicating improved financial profile due to operational efficiencies [6][13] - The company anticipates achieving more than $12.5 million in quarterly revenue by the end of 2025, translating to an annualized revenue run rate of $50 million or better [14] Business Line Data and Key Metrics Changes - The company has consolidated its technology stack into a single cloud-based architecture, enhancing operational efficiency and enabling the introduction of new AI products [5][6] - The launch of the Engage for Service product aims to help auto service departments recover missed opportunities and increase revenue, representing a multimillion-dollar opportunity [8] - Marchex now has deferred or exclusive access to approximately 9,000 auto franchise dealerships, expanding its market footprint [9] Market Data and Key Metrics Changes - The company is strategically positioned in four core verticals: auto, auto services, home services, and healthcare, with plans to deepen its presence in these markets [7] - The partnership with Microsoft through the Microsoft Cloud AI Partner Program allows Marchex's solutions to reach a broader enterprise audience via Azure [10] Company Strategy and Development Direction - Marchex is focused on accelerating growth by launching innovative AI solutions, expanding sales channels, and strengthening its position in high-value verticals [7][17] - The company aims to scale into a $100 million annual revenue business in the coming years, leveraging its first-party conversational data [17] Management's Comments on Operating Environment and Future Outlook - Management acknowledges uncertainty due to the macroeconomic climate but believes current business momentum positions the company well for future growth [14][15] - The company is committed to maintaining financial discipline and delivering value to customers and shareholders [18] Other Important Information - Marchex has adopted a new share repurchase program and reported the sale of an unused domain [16] Q&A Session Summary - There were no questions during the Q&A session, indicating a lack of immediate inquiries from participants [19]
Marchex(MCHX) - 2025 Q1 - Earnings Call Transcript
2025-05-13 22:00
Financial Data and Key Metrics Changes - Revenue for Q1 2025 was $11.4 million, impacted by seasonal call traffic factors and timing of new sales, but expected to benefit the overall 2025 financial plan on a run rate basis [14] - Gross margin increased by approximately 8% compared to Q1 2023, indicating a strengthened financial profile due to operational efficiencies [6][14] - The company anticipates achieving more than $12.5 million in quarterly revenue by the end of 2025, translating to an annualized revenue run rate of $50 million or better [15] Business Line Data and Key Metrics Changes - The company has consolidated its technology stack into a single cloud-based architecture, enhancing operational efficiency and enabling the introduction of new AI products [5][6] - The launch of the Engage for Service product aims to help auto service departments recover missed opportunities and increase revenue, representing a multimillion-dollar opportunity [8][10] Market Data and Key Metrics Changes - Marchex has secured deferred or exclusive access to approximately 9,000 auto franchise dealerships, expanding its market footprint significantly [10] - The company is strategically positioned in four core verticals: auto, auto services, home services, and healthcare, with plans to deepen its presence in these high-value markets [7] Company Strategy and Development Direction - The company is focused on accelerating growth through innovative AI solutions, expanding sales channels, and enhancing its product capabilities across all business functions [7][12] - Marchex aims to scale into a $100 million annual revenue business in the coming years, leveraging its first-party conversational data to drive innovative solutions for Fortune 500 companies [17] Management's Comments on Operating Environment and Future Outlook - Management acknowledges some uncertainty due to the macroeconomic climate but believes the current momentum positions the company well for future growth [15][16] - The company is committed to maintaining financial discipline while driving sustainable growth and delivering value to customers and shareholders [18] Other Important Information - Marchex has adopted a new share repurchase program and reported the sale of an unused domain, indicating proactive financial management [16] Q&A Session Summary - There were no questions from participants during the Q&A session, indicating a lack of immediate inquiries or concerns from stakeholders [19]