Inuvo(INUV)2021-08-12 14:54Financial Performance - For the three months ended June 30, 2021, net revenue was $12,635,583, a 66.5% increase from $7,590,187 in the same period of 2020[93]. - ValidClick revenue increased by 72% year-over-year for the second quarter of 2021, while IntentKey revenue grew by approximately 50% due to new customer acquisitions[94]. - Gross profit for the three months ended June 30, 2021, was $10,371,563, reflecting a 59.1% increase from $6,520,159 in the same quarter of 2020[93]. - Operating expenses for the three months ended June 30, 2021, totaled $12,770,247, a 64.6% increase compared to $7,756,827 in the same period of 2020[96]. - Marketing costs (TAC) for the three months ended June 30, 2021, were $8,213,140, up 112.9% from $3,857,395 in the same quarter of 2020[96]. - The company reported a net cash used in operating activities of $2,465,545 for the six months ended June 30, 2021, compared to $2,336,029 for the same period in 2020[109]. - The net loss for the six months ended June 30, 2021, was $4,529,395, which included non-cash expenses of $1,552,386 for depreciation and amortization[110]. - Net cash provided by financing activities increased to $12,710,562 in the first half of 2021, up from $6,702,072 in the same period of 2020, primarily from the sale of common stock[113]. Workforce and Operations - The company has 76 employees as of June 30, 2021, compared to 70 in the same period of 2020, indicating growth in workforce to support the IntentKey platform[97]. - The company implemented temporary compensation changes for senior officers and employees in response to the financial impact of COVID-19[108]. Financing and Capital - The company raised approximately $14.3 million in January 2021 through securities offerings, contributing to a positive net working capital of $15.4 million as of June 30, 2021[90]. - The company entered into a Sales Agreement allowing for the potential sale of up to $35 million in common stock, although no shares were issued during the three months ended June 30, 2021[105]. - The company may need to fund operations through private or public sales of securities or debt financings if the IntentKey product growth plan is unsuccessful[107]. Cash Flow and Investments - Cash used in investing activities was $788,670 for the six months ended June 30, 2021, compared to $557,818 in 2020, mainly for marketable securities and internal development costs[112]. - The change in operating assets and liabilities resulted in cash used in operations of $24,844, primarily due to the purchase of marketable securities[110]. Market Conditions - The company experienced a significant reduction in advertiser marketing budgets due to COVID-19, adversely impacting overall revenue throughout 2020[108]. - As of June 30, 2021, the company had no off-balance sheet arrangements that could materially affect its financial condition[114]. Future Plans - The company plans to focus resources on growing its AI technology, the IntentKey, which is expected to have higher margins[106]. - Other income for the three months ended June 30, 2021, was approximately $25,000, primarily from unrealized gains on trading securities[101]. - Interest expense, net, for the three months ended June 30, 2021, was approximately $8,000, a decrease from $73,000 in the same period of 2020[99][100].