Marchex(US:MCHX)2026-03-26 12:45Revenue Performance - Revenue decreased by $2.7 million, or 6%, to $45.4 million for the year ended December 31, 2025, compared to $48.1 million for 2024, primarily due to lower call volumes and customer contract consolidations [139]. - The majority of the company's revenues are generated from conversational intelligence product offerings, with revenue derived from variable contracts based on the number of transactions [156]. - Revenue is recognized over time as services are performed, with most customers invoiced monthly following service delivery [157]. Expenses - Cost of revenue decreased by $0.5 million, or 3%, to $16.7 million for the year ended December 31, 2025, representing 37% of revenue, compared to 36% in 2024 [140]. - Sales and marketing expenses increased by $0.4 million, or 3%, to $12.5 million for the year ended December 31, 2025, accounting for 28% of revenue, up from 25% in 2024 [141]. - Product development expenses decreased by $2.7 million, or 22%, to $9.7 million for the year ended December 31, 2025, representing 21% of revenue, down from 26% in 2024 [142]. - General and administrative expenses increased by $0.6 million, or 6%, to $10.8 million for the year ended December 31, 2025, which was 24% of revenue, compared to 21% in 2024 [143]. - Acquisition settlement expense was $1.4 million for the year ended December 31, 2025, related to a historical acquisition matter [144]. - Income tax expense was $0.1 million for the year ended December 31, 2025, down from $0.4 million in 2024, primarily due to deferred tax expenses [146]. Cash Flow - Cash and cash equivalents decreased to $9.9 million as of December 31, 2025, from $12.8 million in 2024 [148]. - Cash used in operating activities was $1.4 million for the year ended December 31, 2025, compared to $1.1 million in 2024, driven by a net loss of $5.2 million [149]. - Cash used in investing activities increased to $1.3 million for the year ended December 31, 2025, primarily for capitalized software development projects [150]. Goodwill and Impairment - Goodwill is tested annually for impairment, with assessments based on qualitative factors and market conditions [164]. - Impairment losses may be recognized if the carrying amount of goodwill exceeds its fair value, which could materially affect financial results [164]. Stock-Based Compensation - Stock-based compensation is measured at grant date based on fair value and recognized as expense over the vesting period using the straight-line method [160].