Marchex, Inc. (NASDAQ:MCHX) Q3 2023 Earnings Conference Call November 8, 2023 5:00 PM ET Company Participants Trevor Caldwell - SVP of Strategic Initiatives & IR Edwin Miller - CEO Holly Aglio - CFO Michael Arends - Vice Chairman Conference Call Participants Operator Good afternoon, and thank you for joining the Marchex Third Quarter 2023 Earnings Call. My name is Kate, and I will be the moderator for today's call. All lines will be muted during the presentation portion of the call, with the question-and-an ...

Financial Data and Key Metrics Changes - For Q2 2023, revenue was $12.5 million, down from $13.5 million in the same quarter last year, indicating a year-over-year decline [17] - GAAP net loss was $2.7 million for Q2 2023, or $0.06 per diluted share, compared to a loss of $1.5 million, or $0.03 per diluted share for Q2 2022 [19] - Adjusted EBITDA loss was approximately $1 million, with an adjusted non-GAAP loss of $0.03 per share for Q2 2023, compared to a loss of $0.01 per share in Q2 2022 [19] Business Line Data and Key Metrics Changes - Continued pressure on conversation volumes in small business listings and solution providers, which has persisted since late 2022 [17] - Growth observed in verticals such as automotive and auto services, with auto dealership-facing products gaining momentum due to expanding OEM relationships [17][20] - Service costs for Q2 2023 were $5.5 million, which increased year-over-year due to higher data and labor costs associated with customer migrations [18] Market Data and Key Metrics Changes - The automotive vertical is expected to achieve double-digit revenue growth on a year-over-year basis by the end of 2023, driven by new customer adoption and existing customer ramping [20][25] - The company anticipates modest revenue growth in Q3 2023 compared to Q2 2023, offsetting headwinds in certain verticals with growth from new customer relationships [46] Company Strategy and Development Direction - The company aims to enhance customer experiences through conversational intelligence, leveraging strong relationships with enterprise companies in various verticals [13] - Focus on continuous innovation and investment in R&D to stay ahead in the conversational intelligence market [14] - Plans to achieve profitability earlier than previously anticipated while preserving the balance sheet for long-term needs [15] Management's Comments on Operating Environment and Future Outlook - Management believes the company is in a strong market position with significant opportunities for growth, particularly in the automotive sector [10][47] - The company has received recognition for its AI solutions, indicating a strong competitive edge in the market [12][38] - Management is optimistic about expanding relationships with Fortune 500 customers and launching new products in the coming months [48] Other Important Information - The company received a customer success award from Apili, highlighting the effectiveness of its solutions [12] - The management emphasizes the importance of data-driven insights and the ability to understand customer needs through advanced analytics [40] Q&A Session Summary Question: What are the volume trends across services? - Management noted that small business solution providers have been down year-over-year, continuing a trend from late 2022, but there is momentum in the automotive sector [50][51] Question: Can you provide a concrete example of conversational intelligence use cases? - A specific example involves 500 dealerships using the platform to quickly deliver education and performance insights based on customer interactions [54] Question: How does Generative AI fit into the company's strategy? - Generative AI is expected to accelerate understanding of customer sentiment and intent, leveraging existing data and math models to enhance service delivery [57][59]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to . Commission File Number 000-50658 Marchex, Inc. (Exact name of Registrant as specified in its charter) Delaware 35-2194038 (State or other jurisdiction of ...

Marchex, Inc. (NASDAQ:MCHX) Q1 2023 Earnings Conference Call May 4, 2023 5:00 PM ET Company Participants Trevor Caldwell – Senior Vice President of Investor Relations and Strategic Initiatives Edwin Miller – Chief Executive Officer Michael Arends – Vice Chairman Conference Call Participants Darren Aftahi – ROTH MKM Vivek Palani – JMN Investments Research Operator Good afternoon. Thank you for attending today’s Marchex Q1 2023 Earnings Call. My name is Cole, and I will be your moderator for today’s call. All ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 OR (Exact name of Registrant as specified in its charter) Delaware 35-2194038 (State or other jurisdiction of incorporation or organization) 1200 5th Ave, Suite 1300 Seattle, WA (Address of Principal Executive Offices) (I.R.S. Employer Identification No.) 98101 (Zip Code) Registrant ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO Commission File Number 000-50658 Marchex, Inc. (Exact name of Registrant as specified in its Charter) | Delaware | | 35-2194038 | | --- | --- | --- | | (State o ...

Marchex, Inc. (NASDAQ:MCHX) Q4 2022 Earnings Conference Call February 28, 2023 5:00 PM ET Company Participants Trevor Caldwell - Investor Relations Edwin Miller - CEO Michael Arends - Vice Chairman Conference Call Participants Dillon Heslin - ROTH Capital Partners Mike Latimore - Northland Capital Market Operator Good afternoon, ladies and gentlemen. Thank you for joining today's Marchex???s Fourth Quarter Earnings Conference Call. My name is Tia and I will be your moderator for today's call. [Operator Inst ...

Financial Data and Key Metrics Changes - Revenue for Q3 2022 was $13.2 million, a decrease from $13.7 million in the same quarter last year, indicating a mixed performance due to macroeconomic pressures [19][25] - GAAP net loss for Q3 2022 was $1.6 million or $0.03 per diluted share, compared to a gain of $3.3 million or $0.07 per diluted share in Q3 2021 [24] - Adjusted EBITDA was positive $10,000, remaining consistent with Q3 2021, while adjusted non-GAAP loss was $0.01 per share, also consistent with the previous year [24] Business Line Data and Key Metrics Changes - Conversation volumes faced pressure due to macroeconomic events and inflation, particularly affecting small business listing providers and marketing services [5][19] - The automotive sector remained stable, while home services did not experience the usual seasonal uptick [32] Market Data and Key Metrics Changes - The auto industry is undergoing significant changes, with a shift towards direct-to-consumer sales and electronic vehicle sales, creating opportunities for Marchex [8][10] - There is a growing demand for conversational intelligence software across various sectors, including healthcare and home services, indicating a positive market trend [12][28] Company Strategy and Development Direction - Marchex is focusing on expanding its cloud-based product suite and enhancing its conversational intelligence capabilities to meet customer needs [11][12] - The company aims to leverage its technology to optimize costs and improve customer experiences, positioning itself as a leader in conversational intelligence [15][26] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the uncertain economic climate but expressed confidence in the company's ability to emerge stronger, driven by ongoing investments and customer engagement [16][26] - The outlook for Q4 2022 anticipates a seasonal decline in revenue but expects to maintain similar revenue levels compared to the previous year, with a focus on sequential progress in 2023 [25][28] Other Important Information - Marchex won the APPEALIE SaaS award for customer success, highlighting its effectiveness in helping businesses recover lost opportunities [11] - The company ended Q3 2022 with over $23 million in cash on hand, providing a solid financial foundation for future growth [24] Q&A Session Summary Question: Revenue mix between verticals - Management noted that automotive remained stable, while home services did not see the expected seasonal uptick, with small business listing providers experiencing significant impacts [32] Question: Visibility on product rollout and monetization - Management confirmed that some new customers have been secured, and existing relationships are expanding, with expectations for sequential progress in 2023 [33][34] Question: Operating leverage and cost management - Management indicated that gross margin is expected to expand with increased revenue, and that sales and marketing costs may grow in line with revenue opportunities [35] Question: Growth of text messaging sales - Text messaging remains a small but growing part of the business, with plans to integrate it more fully into the product suite in 2023 [38] Question: Year-on-year growth in bookings - Management reported growth in secured new arrangements and increased activity in the pipeline across various verticals [39][40] Question: Gross margin trends and levers - Management expects gross margins to remain stable in the near term, with potential for significant improvement as new products contribute to revenue [41]

Revenue Performance - For the nine months ended September 30, 2022, revenue was $39.9 million, a decrease of $808,000, or 2%, compared to $40.7 million for the same period in 2021[90] - The decrease in revenue is primarily due to lower conversational volumes compared to the recovery period in 2021, along with ongoing impacts from COVID-19 variants, supply chain disruptions, inflation, and labor shortages[90] - Revenue decreased by $808,000 or 2%, from $40.7 million for the nine months ended September 30, 2021 to $39.9 million for the same period in 2022[104] - The company expects revenues to be slightly lower in the near term due to reduced seasonal call volume, particularly in the latter part of the fourth quarter[105] - The company expects revenues to recover if macroeconomic conditions improve and business interruptions subside, but potential disruptions from COVID-19 and supply chain issues could lower revenues[127] Operating Expenses - Service costs decreased by $1.6 million or 10%, from $16.4 million for the nine months ended September 30, 2021 to $14.8 million for the same period in 2022, representing 40% and 37% of revenue respectively[108] - Product development expenses decreased by $2.8 million or 21%, from $13.3 million for the nine months ended September 30, 2021 to $10.5 million for the same period in 2022, accounting for 33% and 26% of revenue respectively[114] - General and administrative expenses increased by $413,000 or 6%, from $7.0 million for the nine months ended September 30, 2021 to $7.4 million for the same period in 2022, representing 17% and 19% of revenue respectively[117] - Stock-based compensation expense totaled $2.034 million for the nine months ended September 30, 2022, compared to $2.007 million for the same period in 2021[103] - The company anticipates stable to modestly higher expenditures for product development initiatives in the near and intermediate term[129] Financial Position - The net loss for the nine months ended September 30, 2022, was $4.7 million, an increase from a net loss of $2.4 million for the same period in 2021[124] - Cash used in operating activities was $1.8 million for the nine months ended September 30, 2022, compared to $5.8 million for the same period in 2021[126] - Cash used in investing activities increased to $2.0 million for the nine months ended September 30, 2022, from $504,000 in the same period in 2021[128] - Cash provided by financing activities was $30,000 for the nine months ended September 30, 2022, down from $252,000 in the same period in 2021[130] - The company had cash and cash equivalents of $23.3 million as of September 30, 2022, down from $27.1 million as of December 31, 2021[125] - Long-term contractual obligations as of September 30, 2022, totaled $4.9 million, including $2.0 million for rent under facility operating leases[125] - The company believes its resources will be sufficient to fund operations for at least twelve months, but additional financing may be needed for acquisitions and long-term obligations[131] Strategic Initiatives - Marchex's primary product offerings include Marchex Call Analytics, which helps businesses optimize advertising expenditures and measure call outcomes[80] - Marchex launched Marchex Conversation DNA in March 2022, enabling voice and text conversation decoding and scoring across its products, utilizing over one billion minutes of voice conversations[89] - Marchex plans to expand its conversational intelligence technology and invest in AI, data science, and machine learning capabilities[83] - The company aims to grow its customer base by integrating its products with existing communication providers, enhancing accessibility for businesses[84] - Marchex is pursuing selective acquisition opportunities to enhance its strategic position and increase shareholder value[85] - The company continues to focus on improving marketing performance through its conversational analytics solutions, which received the MarTech Best Marketing Attribution Solution award in 2021[81] Market Outlook - The global conversational AI market is projected to grow at a compounded annual growth rate of 22%, from $6.8 billion in 2021 to $18.4 billion by 2026[81] - The company anticipates volatility in results due to the ongoing impacts of the coronavirus pandemic and macroeconomic conditions[105] - The company believes new product releases and growth initiatives may provide opportunities for potential revenue growth in the longer term[106] Tax and Valuation - As of September 30, 2022, the company recorded a 100% valuation allowance of $54.7 million against its net deferred tax assets, compared to $53.0 million at December 31, 2021[123] - Amortization of intangible assets from acquisitions was $3.7 million for the nine months ended September 30, 2021, decreasing to $1.6 million for the same period in 2022[120] - Interest income decreased significantly from $2.5 million for the nine months ended September 30, 2021 to $33,000 for the same period in 2022[121] Lease Accounting - The company has elected the short-term lease recognition exemption for all qualifying leases, meaning no ROU assets or lease liabilities are recognized for these leases[154] - Operating lease ROU assets and liabilities are recognized at commencement based on the present value of lease payments over the lease term[153] - The company primarily leases office facilities classified as operating leases and does not have finance leases[153] - Lease payments included in the measurement of lease liability are comprised of fixed payments[153] - The company uses its incremental borrowing rate to determine the present value of lease payments as the implicit interest rate is not readily determinable[153] - The lease term includes the non-cancellable period of the lease, with options for lease renewals excluded from the lease term[153] Investor Relations - The company provides access to its financial reports and material information through its investor relations website and social media channels[156] - As a smaller reporting company, the company is not required to provide quantitative and qualitative disclosures about market risk[157]

Marchex, Inc. (NASDAQ:MCHX) Q2 2022 Results Conference Call August 9, 2022 5:00 PM ET Company Participants Trevor Caldwell - Senior Vice President-Strategic Initiatives and Investor Relations Michael Arends - Co-Chief Executive Officer Russell Horowitz - Co-Chief Executive Officer Conference Call Participants Austin Vetterick - ROTH Capital Partners Operator Good afternoon. Thank you for attending today's Marchex' Second Quarter Earnings Conference Call. My name is Tamia, and I will be your moderator for to ...