“In the second quarter, we achieved a significant milestone of positive adjusted cash flow from operations, a non-GAAP measure, evidence that the company is improving its financial fundamentals while driving growth,” said HP Jin, Chairman and CEO of
Telenav’s Board of Directors has authorized a program for the repurchase of up to
Financial highlights for the second quarter ended
- Total revenue for the second quarter of fiscal 2019 was $57.2 million, inclusive of
$4.1 million related to annual map updates, which are recognized whenTelenav provides updated maps, and$1.7 million of customized software development fees, compared with$61.4 million in the second quarter of fiscal 2018, of which$3.0 million was related to periodic map updates, and$0.6 million of customized software development fees. - Billings for the second quarter of fiscal 2019 were $63.6 million, compared with
$70.1 million in the second quarter of fiscal 2018. The year over year decline in revenue and billings was due primarily to lower per unit pricing in the company’s automotive business unit resulting from lower third-party content costs charged through to our customers, partially offset by higher unit volume on its automotive solutions, and lower advertising and mobile navigation revenue. Absent the impact on revenue and billings from the lower third-party content costs, both revenue and billings would have grown during the quarter, as illustrated by the growth of gross profit and adjusted cash flow from operations. - Gross profit was
$25.0 million in the second quarter of fiscal 2019, compared with$23.5 million in the second quarter of fiscal 2018. Automotive gross profit was$19.4 million in the second quarter of fiscal 2019, a 13.2% increase from$17.2 million in the second quarter of fiscal 2018. - Net loss for the second quarter of fiscal 2019 was $(4.6) million, compared with
$(8.4) million for the second quarter of fiscal 2018. The year over year decrease in loss was due primarily to higher gross profit in the automotive business unit and lower overall operating expenses.
- Adjusted cash flow from operations (formerly referred to as adjusted EBITDA on billings) for the second quarter of fiscal 2019 was
$2.6 million compared with$(1.8) million in the second quarter of fiscal 2018.
- Ending cash, cash equivalents and short-term investments, excluding restricted cash, were $85.9 million as of Dec. 31, 2018 an increase of
$4.6 million compared to theSeptember 30, 2018 cash balance of$81.3 million . This total represented cash and short-term investments of $1.89 per share, based on 45.5 million shares of common stock outstanding as of Dec. 31, 2018.Telenav had no debt as of Dec. 31, 2018.
Recent Business Highlights
- 1.3 million
Telenav -equipped vehicles capable of connected services were deployed into the global market during the quarter endedDec. 31, 2018 , bringing the cumulative total to 11.9 million. Telenav surpassed 21 million total auto units shipped withTelenav software and services.- GM launched Telenav’s hybrid navigation solution on additional model year 2019 vehicles, including the Chevrolet Blazer and
Malibu , and the Cadillac CT6. Toyota launched Telenav’s Scout GPS Link on additional model year 2019 vehicles, including the Toyota RAV4 and the Lexus UX.- A contract amendment for the previously announced award of Ford next generation business in
North America was executed inDecember 2018 . Telenav announced collaboration with Amazon Alexa to bring conversational voice interface for in-car navigation.
Q3 Fiscal 2019 Business Outlook
For the third fiscal quarter ending Mar. 31, 2019, Telenav offers the following guidance.
- Total revenue is expected to be $49 million to $53 million.
- Billings are expected to be $61 million to $65 million including
$2.5 million of customized software development fees. - Gross margin is expected to be approximately 45%.
- Direct contribution margin from billings is expected to be approximately 45%.
- Operating expenses are expected to be $31 million to $32 million.
- Net loss is expected to be
$(7) million to $(9) million . - Adjusted EBITDA loss is expected to be
$(5) million to $(6) million . - Adjusted cash flow from operations is expected to be
$(1) million to $1 million . - Automotive revenue is expected to be
$42 million to $45 million . - Advertising revenue is expected to be approximately
$5 million . - Weighted average diluted shares outstanding is expected to be approximately 45.6 million.
Subject to anticipated volumes, take rates and timing of model expansion under Telenav’s various automobile manufacturer and tier one supplier programs, including the potential impact, if any, of our automotive manufacturer customers’ transition of their North American passenger car portfolio to trucks, SUVs and CUVs, and assuming no unforeseen impact from macroeconomic changes, including federal government shutdowns and tariff impacts,
The above information concerning guidance represents Telenav’s outlook only as of the date hereof and is subject to change as a result of amendments to material contracts, other changes in business conditions and other factors. Please refer to the disclosures under “Forward-Looking Statements” below. Telenav undertakes no obligation to update or revise any financial forecast or other forward-looking statements, as a result of new developments, or otherwise.
Conference Call and Quarterly Commentary
ASC 606 Implementation
As reported previously,
The adjustments required to transition to ASC 606 on
Material Weakness in Internal Control over Financial Reporting
During the three months ended
A more detailed explanation, together with a description of the remediation plan that we have adopted to address the identified internal control deficiencies, will be included in our Quarterly Report on Form 10-Q for the quarter ended
Use of Non-GAAP Financial Measures
To reconcile the historical GAAP results to non-GAAP financial metrics, please refer to the reconciliations in the financial statements included in this earnings release.
Billings equals revenue recognized plus the change in deferred revenue from the beginning to the end of the applicable period. Direct contribution from billings reflects gross profit plus change in deferred revenue less change in deferred costs from the beginning to the end of the applicable period. Direct contribution margin from billings reflects direct contribution from billings divided by billings.
Adjusted EBITDA measures net loss excluding the impact of stock-based compensation expense, depreciation and amortization, other income (expense) net, provision (benefit) for income taxes, and other applicable items such as legal settlements and contingencies, deferred rent reversal and tenant improvement allowance recognition due to sublease termination, net of tax. Stock-based compensation expense relates to equity incentive awards granted to its employees, directors, and consultants. Legal settlements and contingencies represent settlements, offers made to settle, or loss accruals relating to litigation or other disputes in which
Adjusted EBITDA and adjusted cash flow from operations are key measures used by Telenav’s management and board of directors to understand and evaluate Telenav’s core operating performance and trends, to prepare and approve its annual budget and to develop short- and long-term operational plans. In particular,
Adjusted cash flow from operations measures adjusted EBITDA plus the effect of changes in deferred revenue and deferred costs.
Free cash flow is a non-GAAP financial measure
In this press release,
Forward Looking Statements
This press release contains forward-looking statements that are based on
ABOUT
Copyright 2019 Telenav, Inc. All Rights Reserved.
“Telenav,” “Scout,” “Thinknear” and the Telenav, Scout and Thinknear logos are registered trademarks of Telenav, Inc. Unless otherwise noted, all other trademarks, service marks, and logos used in this press release are the trademarks, service marks or logos of their respective owners.
TNAV-F
TNAV-C
Investor Relations:
Bishop IR
Mike Bishop
415-894-9633
IR@telenav.com
Media:
Raphel Finelli
408-667-5970
raphelf@telenav.com
-- Financial Tables Follow --
Telenav, Inc. | |||||||||
Condensed Consolidated Balance Sheets | |||||||||
(in thousands, except par value) | |||||||||
(unaudited) | |||||||||
December 31, 2018 |
June 30, 2018 As Adjusted (1) |
||||||||
Assets | |||||||||
Current assets: | |||||||||
Cash and cash equivalents | $ | 22,405 | $ | 17,117 | |||||
Short-term investments | 63,544 | 67,829 | |||||||
Accounts receivable, net of allowances of $10 and $17 at December 31, 2018 and June 30, 2018, respectively | 43,593 | 46,188 | |||||||
Restricted cash | 2,476 | 2,982 | |||||||
Deferred costs | 13,950 | 11,759 | |||||||
Prepaid expenses and other current assets | 3,552 | 3,867 | |||||||
Total current assets | 149,520 | 149,742 | |||||||
Property and equipment, net | 6,396 | 6,987 | |||||||
Deferred income taxes, non-current | 486 | 867 | |||||||
Goodwill and intangible assets, net | 30,479 | 31,046 | |||||||
Deferred costs, non-current | 51,515 | 46,666 | |||||||
Other assets | 3,467 | 2,372 | |||||||
Total assets | $ | 241,863 | $ | 237,680 | |||||
Liabilities and stockholders’ equity | |||||||||
Current liabilities: | |||||||||
Trade accounts payable | $ | 22,991 | $ | 13,008 | |||||
Accrued expenses | 29,367 | 38,803 | |||||||
Deferred revenue | 23,715 | 20,714 | |||||||
Income taxes payable | 258 | 221 | |||||||
Total current liabilities | 76,331 | 72,746 | |||||||
Deferred rent, non-current | 1,051 | 1,112 | |||||||
Deferred revenue, non-current | 64,057 | 53,824 | |||||||
Other long-term liabilities | 993 | 1,115 | |||||||
Commitments and contingencies | |||||||||
Stockholders’ equity: | |||||||||
Preferred stock, $0.001 par value: 50,000 shares authorized; no shares issued or outstanding | — | — | |||||||
Common stock, $0.001 par value: 600,000 shares authorized; 45,541 and 44,871 shares issued and outstanding at December 31, 2018 and June 30, 2018, respectively | 46 | 45 | |||||||
Additional paid-in capital | 170,747 | 167,895 | |||||||
Accumulated other comprehensive loss | (2,010 | ) | (1,855 | ) | |||||
Accumulated deficit | (69,352 | ) | (57,202 | ) | |||||
Total stockholders’ equity | 99,431 | 108,883 | |||||||
Total liabilities and stockholders’ equity | $ | 241,863 | $ | 237,680 | |||||
(1) Certain amounts have been adjusted to reflect the retrospective adoption of ASC 606. Such amounts were further revised during the three months ended December 31, 2018 to correct certain immaterial errors. | |||||||||
Telenav, Inc. | ||||||||||||||||
Condensed Consolidated Statements of Operations | ||||||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||
(unaudited) | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
2018 | 2017 As Adjusted (1) |
2018 | 2017 As Adjusted (1) |
|||||||||||||
Revenue: | ||||||||||||||||
Product | $ | 42,397 | $ | 45,907 | $ | 82,327 | $ | 86,299 | ||||||||
Services | 14,779 | 15,492 | 27,048 | 29,795 | ||||||||||||
Total revenue | 57,176 | 61,399 | 109,375 | 116,094 | ||||||||||||
Cost of revenue: | ||||||||||||||||
Product | 25,015 | 30,356 | 48,603 | 57,679 | ||||||||||||
Services | 7,176 | 7,520 | 14,350 | 13,902 | ||||||||||||
Total cost of revenue | 32,191 | 37,876 | 62,953 | 71,581 | ||||||||||||
Gross profit | 24,985 | 23,523 | 46,422 | 44,513 | ||||||||||||
Operating expenses: | ||||||||||||||||
Research and development | 19,091 | 21,399 | 39,193 | 42,080 | ||||||||||||
Sales and marketing | 4,455 | 5,136 | 8,870 | 10,200 | ||||||||||||
General and administrative | 5,721 | 5,514 | 11,171 | 10,725 | ||||||||||||
Legal settlements and contingencies | 650 | 60 | 650 | 310 | ||||||||||||
Total operating expenses | 29,917 | 32,109 | 59,884 | 63,315 | ||||||||||||
Loss from operations | (4,932 | ) | (8,586 | ) | (13,462 | ) | (18,802 | ) | ||||||||
Other income, net | 532 | 218 | 2,122 | 171 | ||||||||||||
Loss before provision for income taxes | (4,400 | ) | (8,368 | ) | (11,340 | ) | (18,631 | ) | ||||||||
Provision for income taxes | 181 | 26 | 811 | 281 | ||||||||||||
Net loss | $ | (4,581 | ) | $ | (8,394 | ) | $ | (12,151 | ) | $ | (18,912 | ) | ||||
Net loss per share: | ||||||||||||||||
Basic and diluted | $ | (0.10 | ) | $ | (0.19 | ) | $ | (0.27 | ) | $ | (0.43 | ) | ||||
Weighted average shares used in computing net loss per share: | ||||||||||||||||
Basic and diluted | 45,443 | 44,476 | 45,230 | 44,495 | ||||||||||||
(1) Certain amounts have been adjusted to reflect the retrospective adoption of ASC 606. | ||||||||||||||||
Telenav, Inc. | ||||||||||
Condensed Consolidated Statements of Cash Flows | ||||||||||
(in thousands) | ||||||||||
(unaudited) | ||||||||||
Six Months Ended December 31, |
||||||||||
2018 | 2017 As Adjusted (1) |
|||||||||
Operating activities | ||||||||||
Net loss | $ | (12,151 | ) | $ | (18,912 | ) | ||||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||||
Depreciation and amortization | 2,016 | 1,513 | ||||||||
Deferred rent reversal due to lease termination | - | (538 | ) | |||||||
Tenant improvement allowance recognition due to lease termination | - | (582 | ) | |||||||
Accretion of net premium on short-term investments | - | 113 | ||||||||
Stock-based compensation expense | 4,384 | 5,368 | ||||||||
Unrealized gain on non-marketable equity investments | (1,259 | ) | - | |||||||
Loss (gain) on disposal of property and equipment | (8 | ) | 6 | |||||||
Bad debt expense | 2 | 37 | ||||||||
Changes in operating assets and liabilities: | ||||||||||
Accounts receivable | 2,578 | 5,545 | ||||||||
Deferred income taxes | 366 | (23 | ) | |||||||
Income taxes receivable | - | 2 | ||||||||
Deferred costs | (7,040 | ) | (13,298 | ) | ||||||
Prepaid expenses and other current assets | 310 | (476 | ) | |||||||
Other assets | 26 | (620 | ) | |||||||
Trade accounts payable | 10,017 | (1,563 | ) | |||||||
Accrued expenses and other liabilities | (9,962 | ) | (263 | ) | ||||||
Income taxes payable | 39 | (61 | ) | |||||||
Deferred rent | 89 | 767 | ||||||||
Deferred revenue | 13,234 | 19,840 | ||||||||
Net cash provided by (used in) operating activities | 2,641 | (3,145 | ) | |||||||
Investing activities | ||||||||||
Purchases of property and equipment | (446 | ) | (3,350 | ) | ||||||
Purchases of short-term investments | (15,862 | ) | (32,817 | ) | ||||||
Proceeds from sales and maturities of short-term investments | 20,342 | 33,322 | ||||||||
Net cash provided by (used in) investing activities | 4,034 | (2,845 | ) | |||||||
Financing activities | ||||||||||
Proceeds from exercise of stock options | 26 | 235 | ||||||||
Tax withholdings related to net share settlements of restricted stock units | (1,559 | ) | (1,606 | ) | ||||||
Net cash used in financing activities | (1,533 | ) | (1,371 | ) | ||||||
Effect of exchange rate changes on cash and cash equivalents | (360 | ) | 563 | |||||||
Net increase (decrease) in cash, cash equivalents and restricted cash | 4,782 | (6,798 | ) | |||||||
Cash, cash equivalents and restricted cash, at beginning of period | 20,099 | 24,158 | ||||||||
Cash, cash equivalents and restricted cash, at end of period | $ | 24,881 | $ | 17,360 | ||||||
Supplemental disclosure of cash flow information | ||||||||||
Income taxes paid, net | $ | 586 | $ | 640 | ||||||
Reconciliation of cash, cash equivalents and restricted cash to the condensed consolidated balance sheets | ||||||||||
Cash and cash equivalents | $ | 22,405 | $ | 13,956 | ||||||
Restricted cash | 2,476 | 3,404 | ||||||||
Total cash, cash equivalents and restricted cash | $ | 24,881 | $ | 17,360 | ||||||
(1) Certain amounts have been adjusted to reflect the retrospective adoption of ASC 606. | ||||||||||
Telenav, Inc. | ||||||||||||||||
Condensed Consolidated Segment Summary | ||||||||||||||||
(in thousands, except percentages) | ||||||||||||||||
(unaudited) | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
2018 | 2017 As Adjusted (1) |
2018 | 2017 As Adjusted (1) |
|||||||||||||
Automotive | ||||||||||||||||
Revenue | $ | 47,522 | $ | 49,157 | $ | 91,004 | $ | 92,498 | ||||||||
Cost of revenue | 28,081 | 31,981 | 54,698 | 60,724 | ||||||||||||
Gross profit | $ | 19,441 | $ | 17,176 | $ | 36,306 | $ | 31,774 | ||||||||
Gross margin | 41% | 35% | 40% | 34% | ||||||||||||
Advertising | ||||||||||||||||
Revenue | $ | 7,016 | $ | 8,742 | $ | 12,963 | $ | 16,357 | ||||||||
Cost of revenue | 3,286 | 4,402 | 6,506 | 7,814 | ||||||||||||
Gross profit | $ | 3,730 | $ | 4,340 | $ | 6,457 | $ | 8,543 | ||||||||
Gross margin | 53% | 50% | 50% | 52% | ||||||||||||
Mobile Navigation | ||||||||||||||||
Revenue | $ | 2,638 | $ | 3,500 | $ | 5,408 | $ | 7,239 | ||||||||
Cost of revenue | 824 | 1,493 | 1,749 | 3,043 | ||||||||||||
Gross profit | $ | 1,814 | $ | 2,007 | $ | 3,659 | $ | 4,196 | ||||||||
Gross margin | 69% | 57% | 68% | 58% | ||||||||||||
Total | ||||||||||||||||
Revenue | $ | 57,176 | $ | 61,399 | $ | 109,375 | $ | 116,094 | ||||||||
Cost of revenue | 32,191 | 37,876 | 62,953 | 71,581 | ||||||||||||
Gross profit | $ | 24,985 | $ | 23,523 | $ | 46,422 | $ | 44,513 | ||||||||
Gross margin | 44% | 38% | 42% | 38% | ||||||||||||
(1) Certain amounts have been adjusted to reflect the retrospective adoption of ASC 606. | ||||||||||||||||
Telenav, Inc. | ||||||||||||||||
Unaudited Reconciliation of Non-GAAP Adjustments | ||||||||||||||||
(in thousands) | ||||||||||||||||
Reconciliation of Revenue to Billings | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Automotive | ||||||||||||||||
Revenue | $ | 47,522 | $ | 49,157 | $ | 91,004 | $ | 92,498 | ||||||||
Adjustments: | ||||||||||||||||
Change in deferred revenue | 6,495 | 8,940 | 13,324 | 20,091 | ||||||||||||
Billings | $ | 54,017 | $ | 58,097 | $ | 104,328 | $ | 112,589 | ||||||||
Advertising | ||||||||||||||||
Revenue | $ | 7,016 | $ | 8,742 | $ | 12,963 | $ | 16,357 | ||||||||
Adjustments: | ||||||||||||||||
Change in deferred revenue | - | - | - | - | ||||||||||||
Billings | $ | 7,016 | $ | 8,742 | $ | 12,963 | $ | 16,357 | ||||||||
Mobile Navigation | ||||||||||||||||
Revenue | $ | 2,638 | $ | 3,500 | $ | 5,408 | $ | 7,239 | ||||||||
Adjustments: | ||||||||||||||||
Change in deferred revenue | (103 | ) | (194 | ) | (90 | ) | (251 | ) | ||||||||
Billings | $ | 2,535 | $ | 3,306 | $ | 5,318 | $ | 6,988 | ||||||||
Total | ||||||||||||||||
Revenue | $ | 57,176 | $ | 61,399 | $ | 109,375 | $ | 116,094 | ||||||||
Adjustments: | ||||||||||||||||
Change in deferred revenue | 6,392 | 8,746 | 13,234 | 19,840 | ||||||||||||
Billings | $ | 63,568 | $ | 70,145 | $ | 122,609 | $ | 135,934 | ||||||||
Telenav, Inc. | ||||||||||||||
Unaudited Reconciliation of Non-GAAP Adjustments | ||||||||||||||
(in thousands) | ||||||||||||||
Reconciliation of Deferred Revenue to Change in Deferred Revenue | ||||||||||||||
Reconciliation of Deferred Costs to Change in Deferred Costs | ||||||||||||||
Three Months Ended December 31, 2018 | ||||||||||||||
Automotive | Advertising | Mobile Navigation | Total | |||||||||||
Deferred revenue, December 31 | $ | 87,325 | $ | - | $ | 447 | $ | 87,772 | ||||||
Deferred revenue, September 30 | 80,830 | - | 550 | 81,380 | ||||||||||
Change in deferred revenue | $ | 6,495 | $ | - | $ | (103 | ) | $ | 6,392 | |||||
Deferred costs, December 31 | $ | 65,465 | $ | - | $ | - | $ | 65,465 | ||||||
Deferred costs, September 30 | 62,806 | - | - | 62,806 | ||||||||||
Change in deferred costs | $ | 2,659 | $ | - | $ | - | $ | 2,659 | ||||||
Three Months Ended December 31, 2017 | ||||||||||||||
Automotive | Advertising | Mobile Navigation | Total | |||||||||||
Deferred revenue, December 31 | $ | 58,321 | $ | - | $ | 633 | $ | 58,954 | ||||||
Deferred revenue, September 30 | 49,381 | - | 827 | 50,208 | ||||||||||
Change in deferred revenue | $ | 8,940 | $ | - | $ | (194 | ) | $ | 8,746 | |||||
Deferred costs, December 31 | $ | 48,724 | $ | - | $ | - | $ | 48,724 | ||||||
Deferred costs, September 30 | 43,018 | - | - | 43,018 | ||||||||||
Change in deferred costs | $ | 5,706 | $ | - | $ | - | $ | 5,706 | ||||||
Six Months Ended December 31, 2018 | ||||||||||||||
Automotive | Advertising | Mobile Navigation | Total | |||||||||||
Deferred revenue, December 31 | $ | 87,325 | $ | - | $ | 447 | $ | 87,772 | ||||||
Deferred revenue, June 30 | 74,001 | - | 537 | 74,538 | ||||||||||
Change in deferred revenue | $ | 13,324 | $ | - | $ | (90 | ) | $ | 13,234 | |||||
Deferred costs, December 31 | $ | 65,465 | $ | - | $ | - | $ | 65,465 | ||||||
Deferred costs, June 30 | 58,425 | - | - | 58,425 | ||||||||||
Change in deferred costs | $ | 7,040 | $ | - | $ | - | $ | 7,040 | ||||||
Six Months Ended December 31, 2017 | ||||||||||||||
Automotive | Advertising | Mobile Navigation | Total | |||||||||||
Deferred revenue, December 31 | $ | 58,321 | $ | - | $ | 633 | $ | 58,954 | ||||||
Deferred revenue, June 30 | 38,230 | - | 884 | 39,114 | ||||||||||
Change in deferred revenue | $ | 20,091 | $ | - | $ | (251 | ) | $ | 19,840 | |||||
Deferred costs, December 31 | $ | 48,724 | $ | - | $ | - | $ | 48,724 | ||||||
Deferred costs, June 30 | 35,426 | - | - | 35,426 | ||||||||||
Change in deferred costs | $ | 13,298 | $ | - | $ | - | $ | 13,298 | ||||||
Telenav, Inc. | |||||||||||||||||
Unaudited Reconciliation of Non-GAAP Adjustments | |||||||||||||||||
(in thousands, except percentages) | |||||||||||||||||
Reconciliation of Gross Profit to Direct Contribution from Billings | |||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||
December 31, | December 31, | ||||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||||
Automotive | |||||||||||||||||
Gross profit | $ | 19,441 | $ | 17,176 | $ | 36,306 | $ | 31,774 | |||||||||
Gross margin | 41% | 35% | 40% | 34% | |||||||||||||
Adjustments to gross profit: | |||||||||||||||||
Change in deferred revenue | 6,495 | 8,940 | 13,324 | 20,091 | |||||||||||||
Change in deferred costs(1) | (2,659 | ) | (5,706 | ) | (7,040 | ) | (13,298 | ) | |||||||||
Net change | 3,836 | 3,234 | 6,284 | 6,793 | |||||||||||||
Direct contribution from billings (1) | $ | 23,277 | $ | 20,410 | $ | 42,590 | $ | 38,567 | |||||||||
Direct contribution margin from billings (1) | 43% | 35% | 41% | 34% | |||||||||||||
Advertising | |||||||||||||||||
Gross profit | $ | 3,730 | $ | 4,340 | $ | 6,457 | $ | 8,543 | |||||||||
Gross margin | 53% | 50% | 50% | 52% | |||||||||||||
Adjustments to gross profit: | |||||||||||||||||
Change in deferred revenue | - | - | - | - | |||||||||||||
Change in deferred costs | - | - | - | - | |||||||||||||
Net change | - | - | - | - | |||||||||||||
Direct contribution from billings | $ | 3,730 | $ | 4,340 | $ | 6,457 | $ | 8,543 | |||||||||
Direct contribution margin from billings | 53% | 50% | 50% | 52% | |||||||||||||
Mobile Navigation | |||||||||||||||||
Gross profit | $ | 1,814 | $ | 2,007 | $ | 3,659 | $ | 4,196 | |||||||||
Gross margin | 69% | 57% | 68% | 58% | |||||||||||||
Adjustments to gross profit: | |||||||||||||||||
Change in deferred revenue | (103 | ) | (194 | ) | (90 | ) | (251 | ) | |||||||||
Change in deferred costs | - | - | - | - | |||||||||||||
Net change | (103 | ) | (194 | ) | (90 | ) | (251 | ) | |||||||||
Direct contribution from billings | $ | 1,711 | $ | 1,813 | $ | 3,569 | $ | 3,945 | |||||||||
Direct contribution margin from billings | 67% | 55% | 67% | 56% | |||||||||||||
Total | |||||||||||||||||
Gross profit | $ | 24,985 | $ | 23,523 | $ | 46,422 | $ | 44,513 | |||||||||
Gross margin | 44% | 38% | 42% | 38% | |||||||||||||
Adjustments to gross profit: | |||||||||||||||||
Change in deferred revenue | 6,392 | 8,746 | 13,234 | 19,840 | |||||||||||||
Change in deferred costs(1) | (2,659 | ) | (5,706 | ) | (7,040 | ) | (13,298 | ) | |||||||||
Net change | 3,733 | 3,040 | 6,194 | 6,542 | |||||||||||||
Direct contribution from billings (1) | $ | 28,718 | $ | 26,563 | $ | 52,616 | $ | 51,055 | |||||||||
Direct contribution margin from billings (1) | 45% | 38% | 43% | 38% | |||||||||||||
(1) Deferred costs primarily include costs associated with third party content and in connection with certain customized software solutions, the costs incurred to develop those solutions. We expect to incur additional costs in the future due to requirements to provide ongoing map updates and provisioning of services such as hosting, monitoring, customer support and, for certain customers, additional prepaid content and associated technology costs. Accordingly, direct contribution from billings and direct contribution margin from billings do not reflect all costs associated with billings. | |||||||||||||||||
Telenav, Inc. | ||||||||||||||||
Unaudited Reconciliation of Non-GAAP Adjustments | ||||||||||||||||
(in thousands) | ||||||||||||||||
Reconciliation of Net Loss to Adjusted EBITDA and Adjusted Cash Flow from Operations | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Net loss | $ | (4,581 | ) | $ | (8,394 | ) | $ | (12,151 | ) | $ | (18,912 | ) | ||||
Adjustments: | ||||||||||||||||
Legal settlements and contingencies | 650 | 60 | 650 | 310 | ||||||||||||
Deferred rent reversal due to lease termination | - | - | - | (538 | ) | |||||||||||
Tenant improvement allowance recognition due to lease termination | - | - | - | (582 | ) | |||||||||||
Stock-based compensation expense | 2,115 | 2,888 | 4,384 | 5,368 | ||||||||||||
Depreciation and amortization expense | 1,006 | 797 | 2,016 | 1,513 | ||||||||||||
Other income, net | (532 | ) | (218 | ) | (2,122 | ) | (171 | ) | ||||||||
Provision for income taxes | 181 | 26 | 811 | 281 | ||||||||||||
Adjusted EBITDA | (1,161 | ) | (4,841 | ) | (6,412 | ) | (12,731 | ) | ||||||||
Change in deferred revenue | 6,392 | 8,746 | 13,234 | 19,840 | ||||||||||||
Change in deferred costs(1) | (2,659 | ) | (5,706 | ) | (7,040 | ) | (13,298 | ) | ||||||||
Adjusted cash flow from operations(1) | $ | 2,572 | $ | (1,801 | ) | $ | (218 | ) | $ | (6,189 | ) | |||||
(1) We expect to incur additional costs in the future due to requirements to provide ongoing map updates and provisioning of services such as hosting, monitoring, customer support and, for certain customers, additional prepaid content and associated technology costs. Accordingly, adjusted cash flow from operations does not reflect all costs associated with billings. | ||||||||||||||||
Telenav, Inc. | ||||||||||||||||
Unaudited Reconciliation of Non-GAAP Adjustments | ||||||||||||||||
(in thousands) | ||||||||||||||||
Reconciliation of Net Loss to Free Cash Flow | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Net loss | $ | (4,581 | ) | $ | (8,394 | ) | $ | (12,151 | ) | $ | (18,912 | ) | ||||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||||||||||
Change in deferred revenue (1) | 6,392 | 8,746 | 13,234 | 19,840 | ||||||||||||
Change in deferred costs (2) | (2,659 | ) | (5,706 | ) | (7,040 | ) | (13,298 | ) | ||||||||
Changes in other operating assets and liabilities | 2,672 | 2,260 | 3,463 | 3,308 | ||||||||||||
Other adjustments (3) | 3,110 | 3,736 | 5,135 | 5,917 | ||||||||||||
Net cash provided by (used in) operating activities | 4,934 | 642 | 2,641 | (3,145 | ) | |||||||||||
Less: Purchases of property and equipment | (346 | ) | (1,064 | ) | (446 | ) | (3,350 | ) | ||||||||
Free cash flow | $ | 4,588 | $ | (422 | ) | $ | 2,195 | $ | (6,495 | ) | ||||||
(1) Consists of product royalties, customized software development fees, service fees and subscription fees. | ||||||||||||||||
(2) Consists primarily of third party content costs and customized software development expenses. | ||||||||||||||||
(3) Consists primarily of depreciation and amortization, stock-based compensation expense and other non-cash items. | ||||||||||||||||
Telenav, Inc. | ||||||||||||||||||||||||
Summarized Financial Information Depicting the Impact of ASC 606 | ||||||||||||||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||
As of June 30, 2018 | ||||||||||||||||||||||||
As Reported (ASC 605) |
Adjustments | As Adjusted (ASC 606) |
||||||||||||||||||||||
Assets | ||||||||||||||||||||||||
Deferred costs | $ | 31,888 | $ | (20,129 | ) | $ | 11,759 | |||||||||||||||||
Deferred costs, noncurrent | 109,269 | (62,603 | ) | 46,666 | ||||||||||||||||||||
Total assets | 320,412 | (82,732 | ) | 237,680 | ||||||||||||||||||||
Liabilities and stockholders' equity | ||||||||||||||||||||||||
Deferred revenue | 52,871 | (32,157 | ) | 20,714 | ||||||||||||||||||||
Deferred revenue, noncurrent | 182,236 | (128,412 | ) | 53,824 | ||||||||||||||||||||
Accumulated deficit | (135,042 | ) | 77,840 | (57,202 | ) | |||||||||||||||||||
Total liabilities and stockholders' equity | 320,412 | (82,732 | ) | 237,680 | ||||||||||||||||||||
Three Months Ended December 31, 2017 | Six Months Ended December 31, 2017 | |||||||||||||||||||||||
As Reported (ASC 605) |
Adjustments | As Adjusted (ASC 606) |
As Reported (ASC 605) |
Adjustments | As Adjusted (ASC 606) |
|||||||||||||||||||
Revenue | ||||||||||||||||||||||||
Product | $ | 25,307 | $ | 20,600 | $ | 45,907 | $ | 49,271 | $ | 37,028 | $ | 86,299 | ||||||||||||
Services | 13,773 | 1,719 | 15,492 | 26,467 | 3,328 | 29,795 | ||||||||||||||||||
Total revenue | 39,080 | 22,319 | 61,399 | 75,738 | 40,356 | 116,094 | ||||||||||||||||||
Cost of revenue | ||||||||||||||||||||||||
Product | 15,053 | 15,303 | 30,356 | 29,727 | 27,952 | 57,679 | ||||||||||||||||||
Services | 7,258 | 262 | 7,520 | 13,431 | 471 | 13,902 | ||||||||||||||||||
Total cost of revenue | 22,311 | 15,565 | 37,876 | 43,158 | 28,423 | 71,581 | ||||||||||||||||||
Gross profit | 16,769 | 6,754 | 23,523 | 32,580 | 11,933 | 44,513 | ||||||||||||||||||
Operating expenses | ||||||||||||||||||||||||
Research and development | 21,903 | (504 | ) | 21,399 | 42,985 | (905 | ) | 42,080 | ||||||||||||||||
Total operating expenses | 32,613 | (504 | ) | 32,109 | 64,220 | (905 | ) | 63,315 | ||||||||||||||||
Loss from operations | (15,844 | ) | 7,258 | (8,586 | ) | (31,640 | ) | 12,838 | (18,802 | ) | ||||||||||||||
Net loss | (15,652 | ) | 7,258 | (8,394 | ) | (31,750 | ) | 12,838 | (18,912 | ) | ||||||||||||||
Net loss per share, basic and diluted | $ | (0.35 | ) | $ | 0.16 | $ | (0.19 | ) | $ | (0.71 | ) | $ | 0.28 | $ | (0.43 | ) | ||||||||
Source: Telenav, Inc.