Inuvo(US:INUV)2021-08-12 18:21Financial Data and Key Metrics Changes - Inuvo reported revenue of $12.6 million for Q2 2021, representing a 66% year-over-year increase and a 19% sequential increase [5][24] - Adjusted EBITDA for the quarter was a loss of $965,000, roughly flat sequentially [5] - Gross margins decreased to 82% in Q2 2021 from 86% in the same quarter last year, primarily due to a shift in the cost of revenue [26] Business Line Data and Key Metrics Changes - The development platform contributed $9.7 million in revenue, up 72% year-over-year [6] - IntentKey platform revenue was approximately $2.9 million, growing 50% year-over-year and 37% sequentially [8] - ValidClick revenue exceeded the prior year by 72% [24] Market Data and Key Metrics Changes - The number of campaigns launched in Q2 2021 was 84, with a 56% increase in prospective client presentations and a 70% increase in deals won compared to the same period in 2020 [9][10] - ValidClick served ads into roughly 100 million page views, hitting an all-time monthly high [23] Company Strategy and Development Direction - The company is focusing on enhancing its AI capabilities and differentiating its advertising solutions from competitors, particularly in light of the upcoming deprecation of third-party cookies [13][14] - Inuvo is actively looking for M&A opportunities to support growth objectives, focusing on companies with strong client portfolios rather than technology acquisition [53] Management's Comments on Operating Environment and Future Outlook - Management expects strong continuing year-over-year and sequential revenue growth for both product lines in Q3 2021, projecting a 45% to 55% increase year-over-year [36] - The company maintains a strong balance sheet with over $18 million in cash and no debt, indicating no immediate need for additional capital [36] Other Important Information - Operating expenses increased to $12.8 million in Q2 2021 from $7.8 million in the previous year, primarily due to higher marketing costs [27] - The company has been enhancing its internal systems and processes to improve efficiency and scalability [15][16] Q&A Session Summary Question: Can you quantify how many customers you ran campaigns for in Q2 2021? - The company ran 84 campaigns in Q2 2021, which is significantly higher than the previous year [40] Question: How many clients are there compared to last year? - The number of clients has approximately doubled compared to last year [41] Question: Describe the evolution of a new customer. - New customers typically start with a small campaign and gradually increase their budget after successful tests [42][43] Question: How should we think about the introduction of the SaaS model from a P&L perspective? - The SaaS model will coexist with fully managed services, with higher margins expected for the SaaS version [46] Question: Is the market still in recovery for ValidClick? - The market for ValidClick is recovering strongly, with growth trajectories indicating a return to pre-pandemic levels [47] Question: Discuss the M&A landscape and strategy. - The company is actively looking for M&A opportunities to enhance growth, focusing on client portfolios rather than technology [52]