Marchex(US:MCHX)2025-03-14 20:40Revenue Performance - Revenue decreased by $1.8 million, or 4%, to $48.1 million for the year ended December 31, 2024, compared to $49.9 million for 2023, primarily due to lower conversational volumes and non-recurring analytics revenue in 2023 [139]. - Revenue for the year ended December 31, 2024, was $48,122 million, a decrease of 3.6% from $49,910 million in 2023 [182]. - The majority of the company's revenue is generated from conversational intelligence product offerings, with revenue recognized over time as services are performed [156]. - The company reported that 99% of its revenue for both 2024 and 2023 was derived from the United States, indicating a strong domestic market presence [231]. Expenses and Cost Management - Cost of revenue decreased by $3.4 million, or 17%, to $17.2 million for the year ended December 31, 2024, representing 36% of revenue, down from 41% in 2023, driven by lower conversational data processing costs and efficient vendor management [140]. - Sales and marketing expenses increased by $0.7 million, or 6%, to $12.1 million for the year ended December 31, 2024, accounting for 25% of revenue, up from 23% in 2023, mainly due to higher personnel costs [141]. - Product development expenses decreased by $3.0 million, or 19%, to $12.4 million for the year ended December 31, 2024, representing 26% of revenue, down from 31% in 2023, attributed to lower personnel and contractor costs [142]. - General and administrative expenses remained consistent at $10.2 million for both years, accounting for 21% of revenue in 2024, compared to 20% in 2023 [143]. - Total operating expenses decreased to $52,569 million in 2024 from $59,553 million in 2023, representing a reduction of 11.7% [182]. Net Loss and Financial Position - Net loss decreased by $5.0 million, or 51%, to $4.9 million for the year ended December 31, 2024, from $9.9 million in 2023, primarily due to a $7.0 million decrease in operating expenses [147]. - Net loss applicable to common stockholders improved to $(4,947) million in 2024 compared to $(9,910) million in 2023, a decrease of 50.1% [182]. - Basic and diluted net loss per share applicable to common stockholders was $(0.11) in 2024, down from $(0.23) in 2023, reflecting a 52.2% improvement [182]. - The company reported a loss before income tax expense of $4,567,000 in 2024, an improvement from a loss of $9,816,000 in 2023 [260]. Cash Flow and Liquidity - Cash and cash equivalents as of December 31, 2024, were $12.8 million, down from $14.6 million in 2023 [148]. - Cash used in operating activities was $1.1 million for the year ended December 31, 2024, compared to $4.4 million in 2023, reflecting a reduction in net loss and adjustments for non-cash items [149]. - Cash used in investing activities was $0.4 million for the year ended December 31, 2024, down from $1.3 million in 2023, primarily for technology infrastructure and capitalized software development costs [150]. - 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 and acquisitions [152]. Assets and Liabilities - Total assets decreased from $47,477,000 in 2023 to $43,200,000 in 2024, reflecting a decline of approximately 9.5% [180]. - Total liabilities decreased from $11,607,000 in 2023 to $10,567,000 in 2024, a reduction of about 8.9% [180]. - The company's accumulated deficit increased from $(321,231,000) in 2023 to $(326,178,000) in 2024, indicating a worsening of approximately 1.5% [180]. - Accounts receivable, net, decreased from $7,394,000 in 2023 to $7,072,000 in 2024, a decline of approximately 4.4% [180]. Stock and Compensation - Stock-based compensation decreased to $1,707 million in 2024 from $2,393 million in 2023, a reduction of 28.7% [188]. - The company did not grant any stock options with exercise prices less than the current market value during 2024 or 2023 [241]. - The unrecognized compensation costs related to stock options as of December 31, 2024, were $3,100,000, expected to be recognized over 2.59 years [246]. - The company has authorized a total of 138,500,000 shares, including 137,500,000 shares of common stock and 1,000,000 shares of preferred stock [236]. Intangible Assets and Amortization - The total identifiable intangible assets from acquisitions amounted to $26,530,000 as of December 31, 2023, with a net carrying amount of $602,000 after amortization and impairment [270]. - Amortization of intangible assets decreased from $1,987,000 in 2023 to $602,000 in 2024, indicating a significant reduction of approximately 69.7% [271]. - Customer relationships intangible assets had a gross carrying amount of $13,018,000 with accumulated amortization of $9,588,000 as of December 31, 2023 [271]. - Technologies intangible assets had a gross carrying amount of $9,369,000 with accumulated amortization of $8,307,000 as of December 31, 2023 [271]. Future Commitments and Legal Matters - Future minimum payments related to other contractual obligations are approximately $9,612,000 [255]. - The company is currently involved in litigation regarding an earnout of up to $3.0 million related to a previous acquisition [258].