Part I - Financial Information Financial Statements Financials reflect the Teads acquisition's impact, showing asset growth funded by debt and a wider net loss due to one-time costs Condensed Consolidated Balance Sheet Highlights (Unaudited) | Account | March 31, 2025 (in thousands) | December 31, 2024 (in thousands) | Change | | :--- | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $136,312 | $89,094 | +$47,218 | | Goodwill | $587,494 | $63,063 | +$524,431 | | Intangible assets, net | $391,022 | $16,928 | +$374,094 | | Total Assets | $1,688,040 | $549,213 | +$1,138,827 | | Liabilities & Equity | | | | Accounts payable | $274,060 | $206,920 | +$67,140 | | Long-term debt | $610,816 | $0 | +$610,816 | | Total Liabilities | $1,213,375 | $317,870 | +$895,505 | | Total Stockholders' Equity | $474,665 | $231,343 | +$243,322 | Condensed Consolidated Statements of Operations (Unaudited) | Metric | Three Months Ended Mar 31, 2025 (in thousands) | Three Months Ended Mar 31, 2024 (in thousands) | Change | | :--- | :--- | :--- | :--- | | Revenue | $286,357 | $216,964 | +32.0% | | Gross Profit | $82,650 | $41,595 | +98.7% | | Loss from operations | ($44,436) | ($6,597) | +573.6% | | Net loss | ($54,843) | ($5,041) | +988.0% | | Net loss per share (basic & diluted) | ($0.70) | ($0.10) | +600.0% | Condensed Consolidated Statements of Cash Flows Highlights (Unaudited) | Cash Flow Activity | Three Months Ended Mar 31, 2025 (in thousands) | Three Months Ended Mar 31, 2024 (in thousands) | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | ($966) | $8,605 | | Net cash used in investing activities | ($546,320) | ($4,229) | | Net cash provided by (used in) financing activities | $596,094 | ($4,270) | - On February 3, 2025, the company completed the acquisition of Teads for approximately $0.9 billion, resulting in the recognition of $501.6 million in goodwill545559 - The company initiated a restructuring plan post-acquisition, expecting to incur $16 million to $24 million in total charges, with $7.3 million recorded in Q1 20256465 - The company recorded an impairment charge of $15.1 million on intangible assets related to its prior acquisition of 'vi'77 Management's Discussion and Analysis of Financial Condition and Results of Operations Analysis focuses on the Teads acquisition's impact, highlighting revenue growth offset by significant one-time expenses and new debt - The acquisition of Teads was completed on February 3, 2025, for approximately $0.9 billion, making Q1 2025 financials not directly comparable to prior periods162168 Key Performance Metrics Comparison | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Revenue | $286.4M | $217.0M | +32.0% | | Gross Profit | $82.7M | $41.6M | +98.7% | | Net Loss | ($54.8M) | ($5.0M) | +988% | | Ex-TAC Gross Profit (Non-GAAP) | $103.1M | $52.2M | +97.7% | | Adjusted EBITDA (Non-GAAP) | $10.7M | $1.4M | +665% | - The revenue increase was primarily due to $80.3 million in incremental revenue from the Teads acquisition, partially offset by a $10.9 million decrease from the legacy business222 - Operating expenses surged by 163.7% to $127.1 million, driven by acquisition costs, impairment charges, and restructuring charges229231232233 - To finance the acquisition, the company issued $637.5 million in 10% Senior Secured Notes and established a new $100 million revolving credit facility175177236 - As of March 31, 2025, the company had total available liquidity of $255.9 million260 Quantitative and Qualitative Disclosures About Market Risk The company is exposed to market risks from foreign currency, interest rates, inflation, and credit - A hypothetical 10% adverse change in weighted-average exchange rates would impact quarterly operating income by $3.1 million287 - Interest rate risk primarily relates to cash and investments totaling $155.9 million and a $16.2 million variable-rate facility, while the main $610.8 million debt is fixed-rate289291292 - The company is exposed to credit risk from accounts receivable and mitigates it by monitoring customer creditworthiness294 Controls and Procedures Management concluded disclosure controls were effective, with integration of Teads' internal controls currently underway - The CEO and CFO concluded that as of March 31, 2025, the company's disclosure controls and procedures are effective296 - The company is integrating the internal controls of Teads, which was not previously subject to Sarbanes-Oxley (SOX) requirements298 Part II - Other Information Legal Proceedings The company is not currently a party to any material legal proceedings - The company is not currently a party to any material legal proceedings130300 Risk Factors No material changes to risk factors were reported since the last annual filing - No material changes to risk factors have occurred since the filing of the 2024 Form 10-K301 Unregistered Sales of Equity Securities and Use of Proceeds The company issued 43.75 million unregistered shares for the Teads acquisition and made no share repurchases - 43.75 million shares of Common Stock issued to Altice Teads as part of the acquisition were exempt from registration under the Securities Act302 - As of March 31, 2025, $6.6 million remained available for repurchase under the company's share repurchase program, with no shares repurchased during the quarter134303 Other Information The Chief Operating Officer entered into a Rule 10b5-1 trading plan for the potential sale of company stock - The company's COO, Asaf Porat, entered into a 10b5-1 trading plan for the potential sale of up to 311,036 shares of Common Stock306 Exhibits This section indexes exhibits filed with the report, including acquisition and financing agreements - The report includes an index of all exhibits filed, such as the amended Share Purchase Agreement and Indenture for the new notes310
Outbrain (OB) - 2025 Q1 - Quarterly Report