Shutterstock (SSTK) appears an attractive pick, as it has been recently upgraded to a Zacks Rank #1 (Strong Buy). This upgrade is essentially a reflection of an upward trend in earnings estimates -- one of the most powerful forces impacting stock prices.A company's changing earnings picture is at the core of the Zacks rating. The system tracks the Zacks Consensus Estimate -- the consensus measure of EPS estimates from the sell-side analysts covering the stock -- for the current and following years.Individua ...

Have you assessed how the international operations of Shutterstock (SSTK) performed in the quarter ended March 2024? For this online marketplace for royalty-free images and videos, possessing an expansive global footprint, parsing the trends of international revenues could be critical to gauge its financial resilience and growth prospects.In the modern, closely-knit global economic landscape, the capacity of a business to access foreign markets is often a key determinant of its financial well-being and grow ...

PART I. FINANCIAL INFORMATION [Financial Statements (Unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section presents Shutterstock, Inc.'s unaudited consolidated financial statements as of March 31, 2024, detailing balance sheets, operations, cash flows, and notes on key acquisitions [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) As of March 31, 2024, total assets slightly decreased to **$1.029 billion**, driven by lower cash, while total liabilities decreased and stockholders' equity increased Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | **Total Assets** | **$1,028,503** | **$1,036,015** | | Cash and cash equivalents | $71,811 | $100,490 | | Goodwill | $402,787 | $383,325 | | **Total Liabilities** | **$487,228** | **$508,921** | | Deferred revenue | $198,041 | $203,463 | | Debt | $30,000 | $30,000 | | **Total Stockholders' Equity** | **$541,275** | **$527,094** | [Consolidated Statements of Operations](index=5&type=section&id=Consolidated%20Statements%20of%20Operations) Q1 2024 revenue remained flat at **$214.3 million**, but net income significantly decreased by **51%** to **$16.1 million** due to a **13%** increase in total operating expenses Q1 2024 vs. Q1 2023 Statement of Operations (in thousands, except per share data) | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Revenue | $214,315 | $215,280 | | Total operating expenses | $197,569 | $174,911 | | Income from operations | $16,746 | $40,369 | | Net income | $16,121 | $32,843 | | Diluted EPS | $0.45 | $0.90 | [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operating activities sharply decreased to **$8.3 million** in Q1 2024, leading to a net decrease in cash of **$28.7 million** after investing and financing activities Cash Flow Summary (in thousands) | Activity | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :--- | :--- | :--- | | Net cash provided by operating activities | $8,300 | $66,775 | | Net cash used in investing activities | $(16,528) | $(15,937) | | Net cash used in financing activities | $(18,629) | $(70,667) | | **Net decrease in cash and cash equivalents** | **$(28,679)** | **$(19,322)** | [Notes to Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) These notes detail accounting policies and financial items, highlighting the **Backgrid acquisition** for **$20 million**, growth in 'Data, Distribution, and Services' revenue, and the planned **Envato acquisition** for **$245 million** - On February 1, 2024, the Company acquired Backgrid for approximately **$20 million** in cash, resulting in **$19.8 million** of goodwill[34](index=34&type=chunk)[63](index=63&type=chunk)[69](index=69&type=chunk) Revenue by Product Offering (in thousands) | Offering | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Content | $173,830 | $193,984 | | Data, Distribution, and Services | $40,485 | $21,296 | | **Total Revenue** | **$214,315** | **$215,280** | Revenue by Customer Location (in thousands) | Region | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | North America | $110,427 | $99,140 | | Europe | $55,400 | $59,034 | | Rest of the world | $48,488 | $57,106 | | **Total revenue** | **$214,315** | **$215,280** | - On May 1, 2024, the Company agreed to acquire Envato for approximately **$245 million**, funded by a new credit facility and expected to close in Q3 2024[140](index=140&type=chunk)[141](index=141&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=24&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 2024 financial performance, noting flat revenue with a shift from 'Content' to 'Data, Distribution, and Services', declining income due to higher costs, and details on liquidity and the Envato acquisition - The company's business comprises two main offerings: 'Content' (images, footage, music, 3D models) and 'Data, Distribution, and Services' (metadata licenses, Giphy advertising, Shutterstock Studios)[146](index=146&type=chunk)[147](index=147&type=chunk) - On May 1, 2024, the company agreed to acquire Envato, an online marketplace, for approximately **$245 million**, funded by a new credit facility and expected to close in Q3 2024[156](index=156&type=chunk)[157](index=157&type=chunk) Key Operating Metrics | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Subscribers (end of period) | 499,000 | 559,000 | | Paid downloads (in millions) | 35.0 | 42.7 | | Revenue per download | $4.97 | $4.41 | | Average revenue per customer (LTM) | $418 | $356 | [Results of Operations](index=30&type=section&id=Results%20of%20Operations) Q1 2024 revenue was **$214.3 million**, with 'Content' revenue down **10%** offset by 'Data, Distribution, and Services' up **90%**, leading to a **59%** drop in operating income due to **13%** higher expenses - Content revenues decreased by **10%** to **$173.8 million**, primarily due to weakness in new customer acquisition[188](index=188&type=chunk) - Data, Distribution, and Services revenues increased by **90%** to **$40.5 million**, driven by **73%** growth in the data offering[189](index=189&type=chunk) - Cost of Revenue increased by **13%** (**$10.0 million**) due to higher hosting, employee, and D&A costs, largely from Giphy and Backgrid acquisitions[192](index=192&type=chunk) - Sales and Marketing expenses increased by **18%** (**$8.7 million**) due to a **$5.5 million** increase in brand and performance marketing spend[193](index=193&type=chunk) - Product Development expenses increased by **37%** (**$5.6 million**), primarily driven by Giphy employee-related costs[194](index=194&type=chunk) [Liquidity and Capital Resources](index=33&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2024, the company held **$71.8 million** in cash, with **$67 million** available on its credit facility, and paid a **$0.30 per share** dividend - Cash and cash equivalents totaled **$71.8 million** as of March 31, 2024[201](index=201&type=chunk) - The company has a **$100 million** credit facility with **$30 million** drawn and **$67 million** available as of March 31, 2024[210](index=210&type=chunk) - A quarterly cash dividend of **$0.30 per share** was paid in Q1 2024, with a similar dividend declared for Q2 2024[203](index=203&type=chunk)[204](index=204&type=chunk) - No shares were repurchased in Q1 2024; **$71.8 million** remains authorized under the 2023 Share Repurchase Program[207](index=207&type=chunk) [Non-GAAP Financial Measures](index=35&type=section&id=Non-GAAP%20Financial%20Measures) Q1 2024 non-GAAP results show Adjusted EBITDA decreased to **$56.0 million** with margin at **26.1%**, Adjusted Net Income at **$40.6 million**, and Adjusted Free Cash Flow significantly lower at **$11.2 million** Non-GAAP Financial Measures Reconciliation (in thousands) | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net Income | $16,121 | $32,843 | | **Adjusted EBITDA** | **$55,977** | **$69,764** | | Adjusted EBITDA Margin | 26.1% | 32.4% | | **Adjusted Net Income** | **$40,640** | **$47,134** | | Adjusted Net Income per Diluted Share | $1.13 | $1.29 | | **Adjusted Free Cash Flow** | **$11,246** | **$50,868** | - Adjustments to derive non-GAAP figures primarily include depreciation & amortization, non-cash equity-based compensation, and non-recurring Giphy retention compensation expenses[230](index=230&type=chunk)[231](index=231&type=chunk)[232](index=232&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=39&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces market risks from foreign currency fluctuations, with **28%** of Q1 2024 revenue in foreign currencies, while interest rate and inflation risks are not material - Revenue denominated in foreign currencies was approximately **28%** of total revenue for Q1 2024, down from **30%** in Q1 2023[239](index=239&type=chunk) - A hypothetical **10%** change in the USD exchange rate against all foreign currency revenues would impact total revenue by approximately **3%**[239](index=239&type=chunk) - Interest rate risk from the **$30 million** outstanding on the Credit Facility is not considered material, as a **10%** change in rates would not significantly impact interest expense[243](index=243&type=chunk) [Controls and Procedures](index=40&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2024, with no material changes to internal control over financial reporting - The CEO and CFO concluded that as of March 31, 2024, the company's disclosure controls and procedures were effective at the reasonable assurance level[246](index=246&type=chunk) - No material changes to internal control over financial reporting occurred during the quarter ended March 31, 2024[247](index=247&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=41&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently involved in any material active litigation, and existing claims are not expected to have a material adverse effect - The company is not currently party to any material active litigation and does not expect existing matters to have a material adverse effect on its business[249](index=249&type=chunk) [Risk Factors](index=41&type=section&id=Item%201A.%20Risk%20Factors) No material changes occurred to the risk factors previously disclosed in the 2023 Form 10-K - During the three months ended March 31, 2024, there were no material changes to the risk factors as described in the 2023 Form 10-K[250](index=250&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=41&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered sales of equity securities during the period - None[251](index=251&type=chunk) [Signatures](index=43&type=section&id=Signatures) The report was signed on **May 2, 2024**, by Jarrod Yahes, Chief Financial Officer, and Steven Ciardiello, Chief Accounting Officer[262](index=262&type=chunk)

Financial Data and Key Metrics Changes - Revenue for Q1 2024 was $214.3 million, exceeding expectations, while adjusted EBITDA was $56 million with margins of 26.1% [22][30][39] - Content revenue decreased by 10%, aligning with expectations, but the company anticipates a return to growth later in the year [22][30] - The company increased its dividend by 10% to $0.30 per share, marking the fourth consecutive year of double-digit increases [25] Business Line Data and Key Metrics Changes - Data distribution and services revenue surged by 90% in Q1, contributing almost 20% of total revenues [13][49] - The acquisition of Envato is expected to increase revenue from video, audio, and 3D content from 35% to 45% of total content revenue [19] - The average order value (AOV) for new customers increased significantly, with early orders averaging $50,000 and newer customers averaging between $200,000 to $400,000 [15] Market Data and Key Metrics Changes - Total traffic increased by 18% year-on-year, indicating successful SEO and marketing efforts [12] - The contributor base grew by over 40% to 3.4 million, while the library expanded by 34% to nearly 900 million assets [119] - The company is seeing strong demand from larger customers, while demand from small and medium-sized customers remains muted [117] Company Strategy and Development Direction - The company aims to reach $1.2 billion in revenue and $350 million in EBITDA by 2027, with the recent acquisition of Envato accelerating this path [3][56] - The focus is on expanding into faster-growing audiences and diversifying content types, particularly through the Envato acquisition [18][44] - The company is positioned to benefit from the increasing demand for ethically sourced datasets for AI training [41] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the turnaround in the content business, with positive trends noted in small and medium business segments [73][91] - The company anticipates continued strong growth in data distribution and services, driven by regulatory changes and increased demand [49][64] - There is a belief that the company is well-positioned to execute its strategic roadmap and achieve long-term targets [30][48] Other Important Information - The company expects to close the Envato acquisition in Q3 2024, which will significantly impact its revenue base and subscriber count [20][55] - The company has secured a $375 million credit facility to support growth and acquisitions [53] Q&A Session Summary Question: Insights on guidance change with Envato acquisition - The company is incorporating Envato's expected contribution of 20% to revenues and 15% to EBITDA for the full year into its guidance [59] Question: Trends in the content business for April - Management noted positive trends in the content business, particularly in small and medium segments, and expects continued improvement [72][75] Question: Demand for data beyond LLMs - There is increasing demand for visual media as a critical component for training multimodal models, with strong interest from both new and existing customers [77][93] Question: Challenges in scaling Giphy business - The company is seeing high interest and increasing AOV, indicating a positive trend in the advertising model for Giphy [79] Question: Impact of Envato on data sales business - The acquisition is expected to diversify and enhance the data sales business by providing more content and meeting varied customer demands [89]

Execution Version SHARE PURCHASE AGREEMENT BY AND AMONG SHUTTERSTOCK AUS EMU PTY LTD, ENVATO PTY LTD, THE SHAREHOLDERS OF ENVATO PTY LTD, SHUTTERSTOCK, INC. Exhibit 2.1 AND THE SELLERS' REPRESENTATIVE Dated as of May 1, 2024 | | SECTION 1 DEFINITIONS AND INTERPRETATIONS | 1 | | --- | --- | --- | | 1.1 | Certain Definitions | 1 | | 1.2 | Interpretation | 29 | | | SECTION 2 DESCRIPTION OF TRANSACTION | 31 | | 2.1 | Share Purchase | 31 | | 2.2 | Consideration | 31 | | 2.3 | No Further Right of Transfers | 32 | ...

Shutterstock (SSTK) came out with quarterly earnings of $1.13 per share, beating the Zacks Consensus Estimate of $0.95 per share. This compares to earnings of $1.29 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 18.95%. A quarter ago, it was expected that this online marketplace for royalty-free images and videos would post earnings of $0.68 per share when it actually produced earnings of $0.72, delivering a surprise of 5.88% ...

NEW YORK, May 2, 2024 /PRNewswire/ -- Shutterstock, Inc. (NYSE: SSTK), a leading global creative platform offering high-quality creative content for transformative brands, digital media and marketing companies, today announced that it entered into a definitive agreement to acquire Envato Pty Ltd. ("Envato"), a leader in digital creative assets and templates. Envato's flagship product, Elements, is a creative subscription providing unlimited downloads of a diverse array of assets, templates and more—an intel ...

NEW YORK, April 11, 2024  /PRNewswire/ -- Shutterstock, Inc. (NYSE: SSTK), a leading global creative platform offering high-quality creative content for transformative brands, digital media and marketing companies, will report its first quarter 2024 business and financial results on Thursday May 2, 2024 before the market opens.The company will host a conference call at 8:30 a.m. ET to discuss the results. The conference call is being webcast live and can be accessed by either visiting the Company's website ...

Share Repurchases and Dividends - The company repurchased approximately 634,500 shares of common stock at an average cost of $44.45 per share under the 2023 Share Repurchase Program, with $71.8 million remaining authorization as of December 31, 2023[229] - Total repurchases under the 2015, 2017, and 2023 Share Repurchase Programs amounted to approximately 4.4 million shares at an average per-share cost of $51.74[235] - The company repurchased 203,168 shares of its common stock in Q4 2023 at an average price of $45.29 per share, with $71.8 million remaining under the $100 million repurchase authorization[230][233] - The company's dividend policy, initiated in 2020, continues with quarterly cash dividends, subject to board approval and financial conditions[227] - The company's share repurchase programs authorized up to $200 million in repurchases, which were fully utilized by December 31, 2022[228] Ownership and Governance - The company's founder and Executive Chairman, Jonathan Oringer, owns approximately 31% of the outstanding common stock, which may influence major strategic decisions and stockholder approvals[188] - The company had 35,544,416 shares of common stock outstanding as of February 21, 2024[193] - The company's market value of voting and non-voting common stock held by non-affiliates was $1,203,063,393 as of June 30, 2023[5] Revenue and Financial Performance - The company's total revenue for 2023 was $874.6 million, with Content revenue contributing $737.3 million and Data, Distribution, and Services revenue contributing $137.3 million[245] - Revenue increased by $46.8 million (6%) to $874.6 million in 2023 compared to 2022, with a 5% increase on a constant currency basis[281] - Data, Distribution, and Services revenues surged by 256% to $137.3 million in 2023, driven by growth in data offerings and $10.5 million from Giphy[283] - Enterprise revenues grew by 33% to $434.6 million in 2023, fueled by data offerings and contributions from acquisitions like Pond5 and Splash News[285] - E-commerce revenues declined by 12% to $439.9 million in 2023, impacted by weak new customer acquisition, partially offset by Pond5's full-year contribution[284] - Content license revenues declined by 7% to $737.3 million in 2023, impacted by weak customer acquisition, partially offset by Pond5's growth[282] - Net income increased by $34.2 million (45%) to $110.3 million in 2023, driven by a $50.3 million bargain purchase gain and lower tax provisions[280] - Revenue increased by $54.4 million (7%) to $827.8 million in 2022, with 18% and 7% of revenues denominated in Euro and Pounds Sterling, respectively[299] - Data, Distribution, and Services revenues increased by 142% to $38.5 million in 2022, driven by growth in the data offering and Shutterstock Studios[301] - Enterprise revenues increased by 15% to $326.4 million in 2022, driven by growth in the data offering and acquisitions of Pond5 and Splash News[303] - Shutterstock's total revenue for 2023 was $874.6 million, with Content revenue at $737.3 million and Data, Distribution, and Services revenue at $137.3 million[18] Customer and Subscriber Metrics - The company had over 2.0 million active, paying customers in 2023, with 153.0 million paid downloads across all brands[249] - Subscriber revenue for 2023 was $351.5 million, with 523,000 subscribers at the end of the period[264] - Average revenue per customer for the last twelve months was $412 in 2023, up from $341 in 2022[264] - Revenue per download increased to $4.72 in 2023, compared to $4.40 in 2022[264] - Paid downloads decreased to 153.0 million in 2023 from 173.3 million in 2022, with revenue per download rising to $4.72 from $4.40[286] - Revenue per download increased by 6% to $4.40 in 2022, primarily due to changes in product mix and a reduction in paid download volumes[304] - Subscribers are defined as customers purchasing monthly recurring products for at least three months, with subscriber growth seen as an indicator of platform engagement and future growth potential[258] Content and Data Offerings - The company's Data, Distribution, and Services offerings include metadata utilization, Giphy platform integration, and Shutterstock Studios' customized content creation solutions[252][255] - The company's metadata offering has seen increased demand for machine learning and generative AI model training, serving a diverse customer base from large tech companies to startups[253] - The company's content collection grew to 771 million images and 54 million footage clips as of December 31, 2023[249] - Shutterstock's Data, Distribution, and Services offerings include metadata licenses, Giphy distribution and advertising services, and Shutterstock Studios' custom content and production tools[17] - The company's metadata is in high demand for machine learning and generative AI model training, with customers ranging from large tech companies to startups[24] - Shutterstock launched AI image creator and Creative AI-powered editing tools in 2023, offering features like Magic Brush, Variations, Expand Image, Smart Resize, and Background Remover[28] Cybersecurity and Privacy - The company has implemented a layered governance structure for privacy and cybersecurity, including compliance with GDPR, UK Data Protection Law, LGPD, and CPRA[212] - The company conducts annual PCI compliance certification and maintains a bug bounty program and penetration testing to identify and remediate vulnerabilities[213] - The company's cybersecurity strategy includes oversight by a CISO with over 20 years of experience, supported by management-level committees and a cybersecurity incident team[217] - The EU-U.S. Data Privacy Framework, established in October 2022 and extended to the U.K. in October 2023, requires self-certification for data transfers, impacting compliance efforts[147] - Cybersecurity risks could lead to significant capital expenditures, business interruptions, and reputational harm, despite ongoing efforts to safeguard systems[156] Costs and Expenses - The company's cost of revenue includes royalties paid to contributors, which represent the largest component of operating expenses and fluctuate proportionately with revenue and paid downloads[250][270] - Cost of revenue increased by $38.3 million (12%) to $352.6 million in 2023, primarily due to higher depreciation, royalty costs, and Giphy-related expenses[289] - Product development expenses rose by $30.7 million (47%) to $96.2 million in 2023, driven by Giphy-related costs and investments in new products[291] - Sales and marketing expenses grew by $11.6 million (6%) to $214.7 million in 2023, driven by higher employee and consultant costs, including Giphy-related expenses[290] - General and administrative expenses increased by $10.0 million (8%) to $142.6 million in 2023, driven by higher non-cash equity-based compensation and Giphy employee-related costs[292] - Cost of revenue increased by $36.6 million (13%) to $314.3 million in 2022, driven by increased depreciation, royalty costs, and website hosting expenses[306] - Product development expenses increased by $13.4 million (26%) to $65.4 million in 2022, driven by higher employee and third-party contractor costs[308] - Marketing expenses in 2023, 2022, and 2021 were approximately $93.1 million, $97.2 million, and $112.9 million, respectively, with expectations for continued significant spending[93] - Product and development costs in 2023, 2022, and 2021 were approximately $96.2 million, $65.4 million, and $52.0 million, respectively, with potential future increases as the company continues to innovate[96] Tax and Compliance - The company is subject to a 1% excise tax on stock repurchases under the Inflation Reduction Act of 2022, which could increase the cost of future share repurchases[190] - The company faces potential tax liabilities and compliance burdens due to the taxation of e-commerce transactions across multiple jurisdictions, which could impact financial condition[183] Technology and Infrastructure - The company's proprietary AI technology and large-scale datasets power search algorithms and SEO, enhancing content discovery for customers[40] - The company's technology infrastructure supports public-facing web properties and back-office systems, with a focus on proprietary software development[46] - The company has expanded its use of content delivery network solutions to ensure high-speed global access to its platform[52] - The company primarily uses third-party cloud hosting providers to ensure scalable, reliable, and secure global infrastructure, allowing it to focus on scaling its business and meeting global customer demand[51] - The company's growth depends on technological innovation, including expanding capabilities for footage and music track management, requiring significant infrastructure investments[96] Marketing and Customer Acquisition - Marketing investments represent a significant percentage of revenue, with efforts including search engine optimization, paid search, and social media to manage customer acquisition costs and achieve targeted returns[53] - The company's marketing efforts create a self-reinforcing network effect, attracting more paying customers and increasing contributor earnings, which in turn drives more content submissions and customer retention[55] - The company's revenue growth depends on increasing brand awareness and market share, with significant resources allocated to advertising and marketing efforts[99] - Pricing strategies are sensitive to external factors, including competition and technology costs, which could impact sales and margins[92] - The company's marketing efforts, including SEM, SEO, and social media, may not succeed due to execution challenges or external factors beyond control[93] Content Licensing and Contributor Management - The company's subscription-based pricing model offers monthly subscriptions and other contractual plans for content licenses, catering to varying customer needs[36] - The company's contributor website operates in 29 languages, allowing contributors to register and upload content directly through the website or mobile application[38] - Contributors are required to add a descriptive title and up to 50 keywords to each image and footage submission, with AI-driven tools providing keyword suggestions[40] - Contributors can monitor download activity by content type and geography, with insights provided into seasonal and current customer search trends[44] - The company's content review process uses proprietary AI technology and a trained team of reviewers, ensuring high-quality and licensable content[39] - Contributors earn royalties based on a tiered earnings rate schedule tied to annual licensing volume, with the ability to remove content from the collection[43] - The company continuously enhances its content collection through direct acquisitions, strategic partnerships, and exclusive distribution agreements[45] - Content on the platform is licensed under perpetual, royalty-free licenses, with custom content offered on an exclusive basis, while contributors are not typically required to provide content exclusively[57] Intellectual Property and Legal Risks - The company's indemnification obligations under license agreements are capped at amounts ranging from $10,000 to $250,000, with exceptions for certain products where obligations may be uncapped[59] - The company owns a portfolio of trademarks, domain names, copyrights, and patents, which are critical to its business and marketing efforts[61] - The company faces risks from intellectual property claims, which are costly and time-consuming to litigate, potentially harming financial condition and reputation[141] Competition and Market Position - The company faces competition from a wide range of entities, including large media companies, emerging AI technologies, and individual content creators, with low barriers to entry in the industry[88] - Key competitive factors include content quality, licensing options, technology use, brand recognition, and customer service, with competitors potentially offering more attractive or innovative products[89] - The company's growth strategy relies on network effects, where a growing customer base attracts more contributors, increasing content selection and attracting additional paying customers[86] - The company's ability to attract and retain customers and contributors is critical to its success, with any decrease in platform attractiveness potentially leading to revenue loss[87] Expansion and Innovation - Expansion into new content categories, such as Shutterstock Editorial and AI-generated content, and new services like Shutterstock Studios, involves increased capital and marketing spend[102] - The company's growth depends on technological innovation, including expanding capabilities for footage and music track management, requiring significant infrastructure investments[96] Stock Performance and Market Trends - Shutterstock's stock price performance from 2018 to 2023 shows a growth from 100.00 to 142.39, compared to NYSE Composite's growth from 100.00 to 167.12 and S&P Software & Services Select Industry's growth from 100.00 to 204.92[238] Operational and Geographic Reach - Shutterstock operates in over 150 countries and licenses content from contributors in over 100 countries, relying on secure processing and transmission of confidential information[214] - Customer service teams operate in over 20 languages and 150 countries, with teams located in Singapore, Berlin, and New York[56] Other Financial Metrics - The company recognized a bargain purchase gain of $50.3 million in 2023 related to the acquisition of Giphy[293] - Impairment of lease and related assets was $18.7 million in 2022, primarily due to the abandonment of certain office spaces[294] - Other income in 2023 included $4.8 million of interest income and $0.9 million of favorable unrealized foreign currency fluctuations, partially offset by $1.9 million of interest expense[295]

Shares of digital photograph printing company Shutterstock (SSTK -5.20%) fell 5.5% through 12:05 p.m. ET on Wednesday, after the company reported mixed earnings last night.Heading into earnings day, analysts had forecast Shutterstock would report $0.67 per share in adjusted profit on $224 million in sales for its fourth quarter of 2023. As it turned out, Shutterstock beat the profits target, reporting a profit of $0.72 per share. Sales, however, came up short at only $217.2 million. Shutterstock Q4 earnings ...