Cardlytics, Inc., (NASDAQ:CDLX), a purchase intelligence platform
that helps make marketing more relevant and measurable, today
announced financial results for the first quarter ended
March 31, 2018.
“We generated solid first quarter results, with 31%
year-over-year growth in Cardlytics Direct revenue," said Scott
Grimes, CEO & Co-Founder of Cardlytics. “Cardlytics Direct
delivers growth by leveraging purchase intelligence to find
valuable customers and understand precisely the return on a
marketer's investment. This is especially critical in the rapidly
changing retail environment, and we believe it positions us well as
we continue to grow our base of marketers."
“We are pleased to announce the signing of an agreement for a
national launch with JPMorgan Chase,” said Lynne Laube, COO &
Co-Founder of Cardlytics. “The addition of Chase to the Cardlytics
purchase intelligence platform will further strengthen our ability
to provide powerful, actionable insights for our marketer clients
and then act on these insights at scale.”
First Quarter 2018 Financial Results
- Total revenue was $32.7 million, an increase of 22%
year-over-year compared to $26.9 million in the first quarter of
2017.
- Cardlytics Direct revenue was $32.1 million, an increase of 31%
compared to $24.5 million in the first quarter of 2017.
- GAAP net loss was $(20.1) million, or $(1.54) per share based
on 13.1 million weighted-average common shares outstanding,
compared to a loss of $(12.5) million, or $(4.80) per share based
on 2.6 million weighted-average common shares outstanding in the
first quarter of 2017.
- Adjusted contribution, a non-GAAP metric, was $14.2 million
compared to $10.6 million in the first quarter of 2017.
- Adjusted EBITDA, a non-GAAP metric, was a loss of $(3.1)
million compared to a loss of $(4.9) million in the first quarter
of 2017.
- Non-GAAP net loss was $(6.1) million, or $(0.35) per share
based on 17.6 million non-GAAP weighted-average common shares
outstanding, compared to a loss of $(8.7) million, or $(0.75) per
share based on 11.6 million non-GAAP weighted-average common shares
outstanding in the first quarter of 2017.
“We had several important drivers impacting revenue growth.
These include MAU growth, growth in new and existing marketers, and
improved engagement enhancements with our banks,” said David Evans,
CFO of Cardlytics. "With the announcement that Chase will be coming
onto our platform, we are very excited about the longer-term
prospects for the business."
Key Metrics
- FI MAUs were 58.7 million, an increase of 13% compared to 51.9
million in the first quarter of 2017.
- ARPU was $0.55 compared to $0.47 in the first quarter of
2017.
Definitions of FI MAUs and ARPU are included below under the
caption “Non-GAAP Measures and Other Performance Metrics.”
2018 Financial Expectations
Cardlytics anticipates revenue and non-GAAP adjusted EBITDA to
be in the following ranges for the periods indicated (in
millions):
|
Q2 2018 |
|
Full year 2018 |
Revenue |
$34.0
- 35.0 |
|
$153.0
- 156.0 |
Non-GAAP adjusted
EBITDA(1)(2) |
$(4.2)
- (4.0) |
|
$(18.0) - (16.0) |
Estimated Non-GAAP
weighted-average common shares outstanding, basic and diluted |
20.3 |
|
20.1 |
(1) With respect to our expectations above under the caption
“2018 Financial Expectations,” a reconciliation of adjusted EBITDA
to net loss on a forward looking basis is not available without
unreasonable efforts due to the high variability, complexity and
low visibility with respect to the items excluded from this
non-GAAP measure. We have provided a reconciliation of historical
non-GAAP financial measures to the most comparable GAAP measures in
the financial statement tables included in this press release.
(2) The adjusted EBITDA expectations for the full year of 2018
includes the impact of an anticipated $2.0 million expense in the
second half of 2018 related to an expected shortfall in meeting a
minimum FI Share commitment.
Earnings Teleconference Information
Cardlytics will discuss its first quarter 2018 financial results
during a teleconference today, May 10, 2018, at 5:00 PM ET / 2:00
PM PT. The conference call can be accessed at (866) 385-4179
(domestic) or (210) 874-7775 (international), conference ID#
1988047. A replay of the conference call will be available through
8:00 PM ET / 5:00 PM PT on May 17, 2018 at (855) 859-2056
(domestic) or (404) 537-3406 (international). The replay passcode
is 1988047. The call will also be broadcast simultaneously at
http://ir.cardlytics.com/. Following the completion of the call, a
recorded replay of the webcast will be available on Cardlytics’
website.
About Cardlytics
Cardlytics (NASDAQ:CDLX) uses purchase intelligence to make
marketing more relevant and measurable. We partner with more than
2,000 financial institutions to run their banking rewards programs
that promote customer loyalty and deepen banking relationships. In
turn, we have a secure view into where and when consumers are
spending their money. We use these insights to help marketers
identify, reach, and influence likely buyers at scale, as well as
measure the true sales impact of marketing campaigns. Headquartered
in Atlanta, Cardlytics has offices in London, New York, Chicago and
San Francisco. Learn more at www.cardlytics.com.
Cautionary Language Concerning Forward-Looking
Statements:
This press release contains "forward-looking statements" within
the meaning of the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995, including but not limited
to our financial guidance for the second quarter of 2018 and full
year 2018, and the impact of our agreement with JPMorgan Chase on
our business. These forward-looking statements are made as of the
date they were first issued and were based on current expectations,
estimates, forecasts and projections as well as the beliefs and
assumptions of management. Words such as "expect," "anticipate,"
"should," "believe," "hope," "target," "project," "goals,"
"estimate," "potential," "predict," "may," "will," "might,"
"could," "intend," variations of these terms or the negative of
these terms and similar expressions are intended to identify these
forward-looking statements. Forward-looking statements are subject
to a number of risks and uncertainties, many of which involve
factors or circumstances that are beyond our control.
Our actual results could differ materially from those stated or
implied in forward-looking statements due to a number of factors,
including but not limited to: our financial performance, including
our revenue, margins, costs, expenditures, growth rates and
operating expenses, and our ability to sustain revenue growth,
generate positive cash flow and become profitable; risks related to
our substantial dependence on its Cardlytics Direct product; risks
related to our substantial dependence on Bank of America, N.A. and
a limited number of other financial institution (“FI”) partners;
risks related to our ability to successfully implement Cardlytics
Direct for JPMorgan Chase customers and maintain a relationship
with JPMorgan Chase; the amount and timing of budgets by
advertisers, which are affected by budget cycles, economic
conditions and other factors; our ability to generate sufficient
revenue to offset contractual commitments to FIs; our ability to
attract new FI partners and maintain relationships with bank
processors and digital banking providers; our ability to maintain
relationships with marketers; our ability to adapt to changing
market conditions, including our ability to adapt to changes in
consumer habits, negotiate fee arrangements with new and existing
financial institutions and retailers, and develop and launch new
services and features; our significant amount of debt, which may
affect our ability to operate the business and secure additional
financing in the future, and other risks detailed in the “Risk
Factors” section of our Form 10-K filed with the Securities and
Exchange Commission on March 19, 2018 and in subsequent periodic
reports that we file with the Securities and Exchange Commission.
Past performance is not necessarily indicative of future
results. The forward-looking statements included in this press
release represent our views as of the date of this press
release. We anticipate that subsequent events and developments
will cause our views to change. We undertake no intention or
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise,
except as required by law. These forward-looking statements
should not be relied upon as representing our views as of any date
subsequent to the date of this press release.
Non-GAAP Measures and Other Performance
Metrics
To supplement the financial measures presented in our press
release and related conference call or webcast in accordance with
generally accepted accounting principles in the United States
(“GAAP”), we also present the following non-GAAP measures of
financial performance: adjusted contribution, adjusted EBITDA,
non-GAAP net loss and non-GAAP loss per share as well as certain
other performance metrics, such as FI monthly active users (“FI
MAUs”) and average revenue per user (“ARPU”).
A “non-GAAP financial measure” refers to a numerical measure of
our historical or future financial performance or financial
position that is included in (or excluded from) the most directly
comparable measure calculated and presented in accordance with GAAP
in our financial statements. We provide certain non-GAAP measures
as additional information relating to our operating results as a
complement to results provided in accordance with GAAP. The
non-GAAP financial information presented herein should be
considered in conjunction with, and not as a substitute for or
superior to, the financial information presented in accordance with
GAAP and should not be considered a measure of liquidity. There are
significant limitations associated with the use of non-GAAP
financial measures. Further, these measures may differ from the
non-GAAP information, even where similarly titled, used by other
companies and therefore should not be used to compare our
performance to that of other companies.
We have presented adjusted contribution, adjusted EBITDA,
non-GAAP net loss and non-GAAP net loss per share as non-GAAP
financial measures in this press release. We define adjusted
contribution as our revenue less our FI Share and other third-party
costs excluding non-cash equity expense recognized in FI Share and
amortization and impairment of deferred FI implementation costs. We
define adjusted EBITDA as our net loss before income tax benefit;
interest expense, net; depreciation and amortization; stock-based
compensation expense; change in fair value of warrant liabilities;
change in fair value of convertible promissory notes; foreign
currency (gain) loss; loss on extinguishment of debt; costs
associated with financing events; restructuring costs; amortization
and impairment of deferred FI implementation costs; termination of
U.K. agreement expense; and non-cash equity expense recognized in
FI Share. We define non-GAAP net loss as our net loss before
stock-based compensation expense; change in fair value of warrant
liabilities; change in fair value of convertible promissory notes;
foreign currency (gain) loss; loss on extinguishment of debt; costs
associated with financing events; restructuring costs; termination
of U.K. agreement expense and non-cash equity expense recognized in
FI Share. Notably, any expense we accrue related to minimum FI
Share commitments in connection with agreements with certain FI
partners we do not add back to net loss in order to calculate
adjusted EBITDA. We define non-GAAP net loss per share as non-GAAP
net loss divided by non-GAAP weighted-average common shares
outstanding, basic and diluted, which includes our GAAP
weighted-average common shares outstanding, basic and diluted, and
our weighted-average preferred shares outstanding, assuming
conversion.
We believe the use of non-GAAP financial measures, as a
supplement to GAAP measures, is useful to investors in that they
eliminate items that are either not part of our core operations or
do not require a cash outlay, such as stock-based compensation
expense. Management uses these non-GAAP financial measures when
evaluating operating performance and for internal planning and
forecasting purposes. We believe that these non-GAAP financial
measures help indicate underlying trends in the business, are
important in comparing current results with prior period results,
and are useful to investors and financial analysts in assessing
operating performance.
We define FI MAUs as customers or accounts of our FI partners
that logged in and visited the online or mobile banking
applications of, or opened an email from, our FI partners during a
monthly period. We then calculate a monthly average of FI MAUs for
the periods presented above. We define ARPU, as the total GAAP
Cardlytics Direct revenue generated in the applicable period,
divided by the average number of FI MAUs in the applicable
period.
|
CARDLYTICS, INC.CONDENSED CONSOLIDATED
BALANCE SHEETS (UNAUDITED)(Amounts in
thousands) |
|
|
March 31, 2018 |
|
December 31, 2017 |
ASSETS |
|
|
|
CURRENT ASSETS: |
|
|
|
Cash and
cash equivalents |
$ |
89,785 |
|
|
$ |
21,262 |
|
Accounts
receivable, net |
39,907 |
|
|
48,348 |
|
Other
receivables |
2,748 |
|
|
2,898 |
|
Prepaid
expenses and other assets |
3,658 |
|
|
2,121 |
|
Total
current assets |
$ |
136,098 |
|
|
$ |
74,629 |
|
PROPERTY AND EQUIPMENT,
net |
7,363 |
|
|
7,319 |
|
INTANGIBLE ASSETS,
net |
359 |
|
|
528 |
|
CAPITALIZED SOFTWARE
DEVELOPMENT COSTS, net |
880 |
|
|
433 |
|
DEFERRED FI
IMPLEMENTATION COSTS, net |
12,119 |
|
|
13,625 |
|
OTHER LONG-TERM
ASSETS |
988 |
|
|
4,224 |
|
Total
assets |
$ |
157,807 |
|
|
$ |
100,758 |
|
LIABILITIES AND
STOCKHOLDERS’ (DEFICIT) EQUITY |
|
|
|
CURRENT
LIABILITIES: |
|
|
|
Accounts
payable |
$ |
1,783 |
|
|
$ |
1,554 |
|
Accrued
liabilities: |
|
|
|
Accrued
compensation |
3,263 |
|
|
4,638 |
|
Accrued
expenses |
3,918 |
|
|
4,615 |
|
FI Share
liability |
21,376 |
|
|
23,914 |
|
Consumer
Incentive liability |
6,949 |
|
|
7,242 |
|
Deferred
billings |
189 |
|
|
132 |
|
Short-term warrant liability |
17,666 |
|
|
— |
|
Short-term debt: |
|
|
|
Line of
credit |
25,634 |
|
|
— |
|
Capital
leases |
23 |
|
|
44 |
|
Total
current liabilities |
$ |
80,801 |
|
|
$ |
42,139 |
|
LONG-TERM
LIABILITIES: |
|
|
|
Deferred
liabilities |
$ |
3,554 |
|
|
$ |
3,670 |
|
Long-term
warrant liability |
— |
|
|
10,230 |
|
Long-term
debt, net of current portion: |
|
|
|
Line of
credit |
— |
|
|
25,081 |
|
Term
loan |
32,842 |
|
|
31,830 |
|
Capital
leases |
52 |
|
|
57 |
|
Total
long-term liabilities |
$ |
36,448 |
|
|
$ |
70,868 |
|
TOTAL REDEEMABLE
CONVERTIBLE PREFERRED STOCK |
$ |
— |
|
|
$ |
196,437 |
|
STOCKHOLDERS’ (DEFICIT)
EQUITY: |
|
|
|
Common
stock |
$ |
7 |
|
|
$ |
— |
|
Additional paid-in capital |
328,493 |
|
|
58,693 |
|
Accumulated other comprehensive income |
558 |
|
|
1,066 |
|
Accumulated deficit |
(288,500 |
) |
|
(268,445 |
) |
Total
stockholders’ (deficit) equity |
40,558 |
|
|
(208,686 |
) |
Total
liabilities and stockholders’ (deficit) equity |
$ |
157,807 |
|
|
$ |
100,758 |
|
|
|
|
|
|
|
|
|
CARDLYTICS, INC.CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS (UNAUDITED)(Amounts in thousands
except per share amounts) |
|
|
Three Months Ended March 31, |
|
2018 |
|
2017 |
REVENUE |
$ |
32,713 |
|
|
$ |
26,881 |
|
COSTS AND
EXPENSES: |
|
|
|
FI Share
and other third-party costs |
21,420 |
|
|
16,677 |
|
Delivery
costs |
1,943 |
|
|
1,553 |
|
Sales and
marketing expense |
8,216 |
|
|
7,232 |
|
Research
and development expense |
3,459 |
|
|
3,013 |
|
General
and administration expense |
6,582 |
|
|
4,689 |
|
Depreciation and amortization expense |
910 |
|
|
765 |
|
Total
costs and expenses |
42,530 |
|
|
33,929 |
|
OPERATING LOSS |
(9,817 |
) |
|
(7,048 |
) |
OTHER INCOME
(EXPENSE): |
|
|
|
Interest
expense, net |
(1,749 |
) |
|
(2,644 |
) |
Change in
fair value of warrant liabilities, net |
(9,172 |
) |
|
(327 |
) |
Change in
fair value of convertible promissory notes |
— |
|
|
(383 |
) |
Change in
fair value of convertible promissory notes—related parties |
— |
|
|
(2,223 |
) |
Other
income, net |
683 |
|
|
162 |
|
Total
other expense |
(10,238 |
) |
|
(5,415 |
) |
LOSS BEFORE INCOME
TAXES |
(20,055 |
) |
|
(12,463 |
) |
INCOME TAX BENEFIT |
— |
|
|
— |
|
NET LOSS |
$ |
(20,055 |
) |
|
$ |
(12,463 |
) |
Adjustments to the
carrying value of redeemable convertible preferred stock |
(157 |
) |
|
(244 |
) |
Net loss attributable
to common stockholders |
$ |
(20,212 |
) |
|
$ |
(12,707 |
) |
Net loss per share
attributable to common stockholders, basic and diluted |
$ |
(1.54 |
) |
|
$ |
(4.80 |
) |
Weighted-average common
shares outstanding, basic and diluted |
13,093 |
|
|
2,645 |
|
|
|
|
|
|
|
CARDLYTICS, INC.STOCK-BASED
COMPENSATION EXPENSE (UNAUDITED)(Amounts in
thousands) |
|
|
Three Months Ended March 31, |
|
2018 |
|
2017 |
Delivery costs |
$ |
85 |
|
|
$ |
41 |
|
Sales and marketing
expense |
943 |
|
|
344 |
|
Research and
development expense |
470 |
|
|
171 |
|
General and
administration expense |
1,402 |
|
|
427 |
|
Total
stock-based compensation expense |
$ |
2,900 |
|
|
$ |
983 |
|
|
|
|
|
|
|
|
|
CARDLYTICS, INC.CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS (UNAUDITED)(Amounts in
thousands) |
|
|
Three Months Ended March 31, |
|
2018 |
|
2017 |
CASH FLOWS FROM
OPERATING ACTIVITIES: |
|
|
|
Net
loss |
$ |
(20,055 |
) |
|
$ |
(12,463 |
) |
Adjustments to reconcile net loss to net cash used in operating
activities: |
|
|
|
Change in
allowance for doubtful accounts |
(32 |
) |
|
(4 |
) |
Depreciation and amortization |
910 |
|
|
765 |
|
Amortization of financing costs charged to interest expense |
140 |
|
|
148 |
|
Accretion
of debt discount and non-cash interest expense |
1,500 |
|
|
2,307 |
|
Stock
compensation expense |
2,900 |
|
|
983 |
|
Change in
the fair value of warrant liabilities, net |
9,172 |
|
|
327 |
|
Change in
the fair value of convertible promissory notes |
— |
|
|
383 |
|
Change in
the fair value of convertible promissory notes - related
parties |
— |
|
|
2,223 |
|
Other
non-cash expenses |
2,253 |
|
|
229 |
|
Change in
operating assets and liabilities: |
|
|
|
Accounts
receivable |
8,623 |
|
|
6,672 |
|
Prepaid
expenses and other assets |
(1,520 |
) |
|
(551 |
) |
Deferred
FI implementation costs |
1,094 |
|
|
962 |
|
Accounts
payable |
(408 |
) |
|
631 |
|
Other
accrued expenses |
(1,836 |
) |
|
(2,802 |
) |
FI Share
liability |
(2,538 |
) |
|
(4,643 |
) |
Customer
Incentive liability |
(293 |
) |
|
(991 |
) |
Total
adjustment |
19,965 |
|
|
6,639 |
|
Net cash
used in operating activities |
$ |
(90 |
) |
|
$ |
(5,824 |
) |
CASH FLOWS FROM
INVESTING ACTIVITIES: |
|
|
|
Acquisition of property
and equipment |
(418 |
) |
|
(386 |
) |
Acquisition of
patents |
(2 |
) |
|
(16 |
) |
Capitalized software
development costs |
(374 |
) |
|
— |
|
Net cash
used in investing activities |
$ |
(794 |
) |
|
$ |
(402 |
) |
CASH FLOWS FROM
FINANCING ACTIVITIES: |
|
|
|
Proceeds
from issuance of debt |
— |
|
|
7,500 |
|
Principal
payments of debt |
(26 |
) |
|
(24 |
) |
Proceeds
from issuance of common stock |
70,490 |
|
|
270 |
|
Equity
issuance costs |
(1,232 |
) |
|
(181 |
) |
Net cash
from financing activities |
$ |
69,232 |
|
|
$ |
7,565 |
|
EFFECT OF EXCHANGE
RATES ON CASH, CASH EQUIVALENTS AND RESTRICTED CASH |
175 |
|
|
46 |
|
NET DECREASE IN CASH,
CASH EQUIVALENTS AND RESTRICTED CASH |
68,523 |
|
|
1,385 |
|
CASH, CASH EQUIVALENTS
AND RESTRICTED CASH — Beginning of year |
21,262 |
|
|
22,968 |
|
CASH, CASH EQUIVALENTS
AND RESTRICTED CASH — End of period |
$ |
89,785 |
|
|
$ |
24,353 |
|
|
|
|
|
|
|
|
|
CARDLYTICS, INC.RECONCILIATION OF GAAP
REVENUE TO NON-GAAP ADJUSTED CONTRIBUTION
(UNAUDITED)(Amounts in thousands) |
|
|
Three Months Ended March 31, |
|
2018 |
|
2017 |
Revenue |
$ |
32,713 |
|
|
$ |
26,881 |
|
Minus: |
|
|
|
FI Share
and other third-party costs(1) |
18,489 |
|
|
16,286 |
|
Adjusted
contribution(2) |
$ |
14,224 |
|
|
$ |
10,595 |
|
|
|
|
|
|
|
|
|
(1) FI Share and other third-party costs presented above
excludes non-cash equity expense included in FI Share and
amortization and impairment of deferred FI implementation costs,
which are detailed below in our reconciliation of GAAP net loss to
non-GAAP adjusted EBITDA. (2) During the first quarter of
2017, adjusted contribution includes the impact of a $1.5 million
accrued expense related to an expected shortfall in meeting a
minimum FI Share commitment. There was no corresponding accrued
expense during the first quarter of 2018.
|
|
CARDLYTICS, INC.RECONCILIATION OF GAAP
NET LOSS TO NON-GAAP ADJUSTED EBITDA (UNAUDITED)(Amounts in
thousands) |
|
Three Months Ended March 31, |
|
2018 |
|
2017 |
Net loss |
$ |
(20,055 |
) |
|
$ |
(12,463 |
) |
Plus: |
|
|
|
Interest
expense, net |
1,749 |
|
|
2,644 |
|
Depreciation and amortization expense |
910 |
|
|
765 |
|
Stock-based compensation expense |
2,900 |
|
|
983 |
|
Non-cash
equity expense included in FI Share |
2,519 |
|
|
— |
|
Change in
fair value of warrant liabilities |
9,172 |
|
|
327 |
|
Change in
fair value of convertible promissory notes |
— |
|
|
2,606 |
|
Foreign
currency gain |
(683 |
) |
|
(165 |
) |
Amortization and impairment of deferred FI implementation
costs |
412 |
|
|
391 |
|
Adjusted
EBITDA(1) |
$ |
(3,076 |
) |
|
$ |
(4,912 |
) |
|
|
|
|
|
|
|
|
(1) During the first quarter of 2017, adjusted EBITDA includes
the impact of a $1.5 million accrued expense related to an expected
shortfall in meeting a minimum FI Share commitment. There was no
corresponding accrued expense during the first quarter of 2018.
|
|
CARDLYTICS, INC.RECONCILIATION OF GAAP
NET LOSS TO NON-GAAP NET LOSS (UNAUDITED)(Amounts
in thousands except per share amounts) |
|
Three Months Ended March 31, |
|
2018 |
|
2017 |
Net loss |
$ |
(20,055 |
) |
|
$ |
(12,463 |
) |
Plus: |
|
|
|
|
|
|
|
Stock-based compensation expense |
2,900 |
|
|
983 |
|
Non-cash
equity expense included in FI Share |
2,519 |
|
|
— |
|
Change in
fair value of warrant liabilities |
9,172 |
|
|
327 |
|
Change in
fair value of convertible promissory notes |
— |
|
|
2,606 |
|
Foreign
currency gain |
(683 |
) |
|
(165 |
) |
Non-GAAP
net loss |
$ |
(6,147 |
) |
|
$ |
(8,712 |
) |
Weighted-average number
of shares of common stock used in computing non-GAAP net loss per
share: |
|
|
|
GAAP
weighted-average common shares outstanding, basic and diluted |
13,093 |
|
|
2,645 |
|
Weighted-average preferred shares, assuming conversion |
4,494 |
|
|
9,001 |
|
Non-GAAP
weighted-average common shares outstanding, basic and diluted |
17,587 |
|
|
11,646 |
|
Non-GAAP net loss per
share attributable to common stockholders, basic and diluted |
$ |
(0.35 |
) |
|
$ |
(0.75 |
) |
|
|
|
|
|
|
|
|
Investor Relations: William Maina ICR, Inc. (646) 277-1236
ir@cardlytics.com
Cardlytics (NASDAQ:CDLX)
Historical Stock Chart
From Mar 2024 to Apr 2024
Cardlytics (NASDAQ:CDLX)
Historical Stock Chart
From Apr 2023 to Apr 2024