January 31, 2017

Telenav Reports Second Quarter Fiscal 2017 Financial Results

SANTA CLARA, Calif., Jan. 31, 2017 (GLOBE NEWSWIRE) -- Telenav®, Inc. (NASDAQ:TNAV), a leader in connected car services, today announced its financial results for the second quarter that ended December 31, 2016.

"Telenav delivered strong top line results for the second quarter of fiscal 2017, with revenue growing 15% year-over-year to $52.0 million and billings growing 23% year-over-year to $59.7 million," said HP Jin, chairman and CEO of Telenav. "We continued to make solid progress towards the GM launch of our embedded and connected navigation solution which we expect to occur in the next couple of months. We also announced an additional award with Toyota. We are excited to see the relationship with Toyota continue to deepen and are pleased that Scout® GPS Link was chosen to be in select 2018 Toyota vehicles equipped with Entune™ 3.0. We believe our partnerships with global auto OEMs, ranging from brought-in solutions to embedded and connected solutions, is a testament to our broad capabilities and market leadership."

Financial Highlights for the second quarter ended December 31, 2016

  • Total revenue was $52.0 million, compared with $45.3 million in the same prior year period.
  • Billings were $59.7 million, compared with $48.4 million in the same prior year period.
  • Automotive revenue was $38.7 million, compared with $31.8 million in the same prior year period.
  • Advertising revenue was $8.2 million, compared with $6.7 million in the same prior year period.
  • Deferred revenue as of December 31, 2016 was $36.1 million, compared with $28.4 million as of September 30, 2016.
  • Gross margin was 45%, compared to 46% in the same prior year period.
  • Non-GAAP gross margin on billings was 45%, compared to 46% in the same prior year period.
  • Operating expenses were $34.9 million, compared with $27.6 million in the same prior year period.
  • Net loss was ($11.4) million, or ($0.26) per basic and diluted share, compared with ($6.6) million, or ($0.16) per basic and diluted share, in the same prior year period.
  • Adjusted EBITDA was a ($2.6) million loss, compared with a ($4.1) million loss in the same prior year period.
  • Adjusted EBITDA on billings was $1.3 million, compared with a ($2.6) million loss in the same prior year period.
  • As of December 31, 2016, ending cash, cash equivalents and short-term investments, excluding restricted cash, were $103.7 million. This represented cash and short-term investments of $2.39 per share, based on 43.3 million shares of common stock outstanding. Telenav had no debt as of quarter end.
  • Free cash flow was $2.7 million, compared with ($0.9) million in the same prior year period.

Recent Business Highlights

  • Settled a patent lawsuit with Vehicle IP, LLC resolving a patent infringement litigation brought against Telenav and Telenav's customer AT&T Mobility LLC, resulting in a one-time settlement and license payment of $8.0 million to be made by Telenav.
  • Announced Scout GPS Link by Telenav was chosen for select 2018 Toyota vehicles equipped with Entune 3.0.

"We are pleased to announce that we expect to enter into an agreement with Ford to provide our MapCare solution in conjunction with our embedded navigation product for the European region, commencing in the March 2017 quarter. This will significantly increase our overall billings going forward and strengthens our overall business," said Michael Strambi, Telenav's CFO. "However, because MapCare is to be provided over time, the revenue related to this combined offering is required to be recognized over the contractual period. As a result, certain revenue related to royalties earned from embedded navigation with Ford in Europe, which Telenav has been recognizing upon product delivery, will now be recognized over time. Starting with the March 2017 quarter, this impact will cause our revenue to decline under current GAAP accounting measures."

Business Outlook
For the quarter ending March 31, 2017, Telenav offers the following guidance, which is predicated on management's judgments: 

  • Total revenue is expected to be $37 to $39 million.
  • Billings are expected to be $60 to $63 million.
  • Automotive revenue is expected to be 71% to 74% of total revenue.
  • Advertising revenue is expected to be approximately 16% of total revenue.
  • Gross margin is expected to be approximately 48%.
  • Non-GAAP gross margin on billings is expected to be approximately 39%.
  • Operating expenses are expected to be $30 to $31 million.
  • Net loss is expected to be ($12) to ($13) million.
  • Net loss per share is expected to be ($0.28) to ($0.30).
  • Adjusted EBITDA is expected to be a ($9.0) to ($10.0) million loss.
  • Adjusted EBITDA on billings is expected to be a ($3.5) to ($4.5) million loss.
  • Weighted average shares outstanding are expected to be approximately 43.5 million.

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 and other changes in business conditions.  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
The company will host an investor conference call and live webcast at 2:00 p.m. PT (5:00 p.m. ET) today. To access the conference call, dial 877-795-3648 (toll-free, domestic only) or 719-325-4755 (domestic and international toll) and enter pass code 5663996. The webcast will be accessible on Telenav's investor relations website at http://investor.telenav.com.  A replay of the conference call will be available for two weeks beginning approximately two hours after its completion. To access the replay, dial 888-203-1112 (toll-free, domestic only) or 719-457-0820 (domestic and international toll) and enter pass code 5663996.

Use of Non-GAAP Financial Measures
Telenav prepares its financial statements in accordance with generally accepted accounting principles for the United States, or GAAP. The non-GAAP financial measures such as billings, non-GAAP gross profit on billings, non-GAAP gross margin on billings, change in deferred revenue, change in deferred costs, adjusted EBITDA, adjusted EBITDA on billings and free cash flow included in this press release are different from those otherwise presented under GAAP. 

Telenav has provided these measures in addition to GAAP financial results because management believes these non-GAAP measures help provide a consistent basis for comparison between periods that are not influenced by certain items and therefore are helpful in understanding Telenav's underlying operating results. These non-GAAP measures are some of the primary measures Telenav's management uses for planning and forecasting. These measures are not in accordance with, or an alternative to, GAAP and these non-GAAP measures may not be comparable to information provided by other companies.

We have previously provided billings as a non-GAAP metric, and beginning with this quarter we are providing non-GAAP gross profit on billings, non-GAAP gross margin on billings and adjusted EBITDA on billings' metrics. We anticipate providing non-GAAP gross profit on billings, non-GAAP gross margin on billings and adjusted EBITDA on billings over the next two quarters due to the impact on reported GAAP revenue of certain value-added offerings, including Ford MapCare anticipated for SYNC 3 vehicles in the Europe region.  The providing of MapCare in combination with our embedded navigation products results in revenue being deferred and recognized over time. 

We anticipate early adopting the FASB's new accounting standard, ASC 606, Revenue from Contracts with Customers, effective July 1, 2017.  We anticipate that with the adoption of ASC 606, our revenue recognition for certain value-added offerings will change and we will no longer recognize revenue associated with certain software-related elements over the life of our contractual obligations.  Once we adopt ASC 606, we do not expect that we will continue to provide the metrics non-GAAP gross profit on billings, non-GAAP gross margin on billings and adjusted EBITDA on billings.

Billings measure GAAP revenue recognized plus the change in deferred revenue from the beginning to the end of the period. Non-GAAP gross profit on billings reflects GAAP gross profit plus change in deferred revenue less change in deferred costs. Non-GAAP gross margin on billings reflects non-GAAP gross profit on billings divided by billings.  We have also provided a breakdown of the calculation of the change in deferred revenue by segment, which is added to revenue in calculating our non-GAAP metric of billings. In connection with our presentation of the change in deferred revenue, we have provided a similar presentation of the change in the related deferred costs. Such 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. As deferred revenue and deferred costs become larger components of our operating results, we believe these metrics are useful in evaluating cash flow.

We consider billings, non-GAAP gross profit on billings and non-GAAP gross margin on billings to be useful metrics for management and investors because billings drive deferred revenue, which is an important indicator of our business. We believe non-GAAP gross profit on billings and non-GAAP gross margin on billings are useful metrics because they reflect the impact of the gross profit to be earned over time for such billings, exclusive of the incremental costs incurred to deliver any related service obligations.  There are a number of limitations related to the use of billings, non-GAAP gross profit on billings and non-GAAP gross margin on billings versus revenue, gross profit, and gross margin calculated in accordance with GAAP. First, billings, non-GAAP gross profit on billings, and non-GAAP gross margin on billings include amounts that have not yet been recognized as revenue or cost and may require additional services to be provided over contracted service periods. For example, billings related to certain connected solutions cannot be fully recognized as revenue in a given period due to requirements for ongoing provisioning of services such as hosting, monitoring and customer support. Accordingly, non-GAAP gross profit on billings and non-GAAP gross margin on billings do not include all costs associated with billings. Second, we may calculate billings, non-GAAP gross profit on billings, and non-GAAP gross margin on billings in a manner that is different from peer companies that report similar financial measures, making comparisons between companies more difficult. When we use these measures, we attempt to compensate for these limitations by providing specific information regarding billings, non-GAAP gross profit on billings and non-GAAP gross margin on billings and how they relate to revenue, gross profit, and gross margin calculated in accordance with GAAP.

Adjusted EBITDA measures our GAAP net loss excluding the impact of stock-based compensation expense, depreciation and amortization, other income (expense), provision (benefit) for income taxes, and other applicable items such as legal settlements and contingencies, restructuring accruals and reversals, and deferred rent reversals due to lease termination, net of tax. Stock-based compensation expense relates to equity incentive awards granted to our employees, directors, and consultants. Legal settlements and contingencies represent settlements and offers made to settle patent litigation cases in which we are defendants and royalty disputes. Deferred rent reversals represent the reversal of our deferred rent liability that is no longer required due to our facility lease termination in fiscal 2016. We believe adjusted EBITDA is a useful measure of profitability before the impact of certain non-cash expenses, interest income, income taxes, and certain other items that management believes affect the comparability of operating results.

Adjusted EBITDA on billings measures adjusted EBITDA plus the effect of changes in deferred revenue and deferred costs. We believe adjusted EBITDA on billings is a useful measure, especially in light of the impact we expect on reported GAAP revenue for certain value-added offerings we provide our customers, including Ford MapCare. Adjusted EBITDA and adjusted EBITDA on billings, while generally measures of profitability, can also represent losses.

Free cash flow is a non-GAAP financial measure we define as net cash provided by (used in) operating activities, less purchases of property and equipment. We consider free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash (used in) generated by our business after purchases of property and equipment.

We determined that it would be meaningful to investors to develop a breakout of the operating results of the advertising business beyond the current GAAP segment reporting of revenue, cost of revenue and gross margin, and we are including such presentation in our non-GAAP reporting results. This presentation reflects operating expenses that are directly attributable to the advertising business. We are unable to provide a similar breakout of operating results for the automotive and mobile navigation businesses beyond the current GAAP segment reporting of revenue, cost of revenue and gross margin because these segments share many of the same technologies and resources and as such, have operating expenses which cannot be fully attributable to one versus the other segment. In addition, the reported non-GAAP operating results for the advertising business only include an allocation of certain shared corporate general and administrative costs that directly benefit the business, such as accounting and human resource services.

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.

In this earnings release, Telenav has provided guidance for the third quarter of fiscal 2017 on a non-GAAP basis, for billings, non-GAAP gross margin on billings, adjusted EBITDA and adjusted EBITDA on billings.  Telenav does not provide reconciliations of its forward-looking non-GAAP financial measures of billings, non-GAAP gross margin on billings, adjusted EBITDA and adjusted EBITDA on billings to the corresponding GAAP measures due to the high variability and difficulty in making accurate forecasts and projections with respect to deferred revenue, deferred costs, stock-based compensation and tax provision (benefit), which are components of these non-GAAP financial measures.  In particular, stock-based compensation is impacted by future hiring and retention needs, as well as the future fair market value of Telenav's common stock, all of which is difficult to predict and subject to constant change. The actual amounts of these items will have a significant impact on Telenav's GAAP net loss per diluted share and GAAP tax provision (benefit). Accordingly, reconciliations of Telenav's forward-looking non-GAAP financial measures to the corresponding GAAP measures are not available without unreasonable effort.

Forward Looking Statements
This press release contains forward-looking statements that are based on Telenav management's beliefs and assumptions and on information currently available to our management.  Actual events or results may differ materially from those described in this document due to a number of risks and uncertainties. These potential risks and uncertainties include, among others:  Telenav's entry into an agreement with Ford to provide MapCare in Europe for SYNC 3 equipped vehicles; Telenav's ability to develop and implement products for Ford, GM and Toyota and to support Ford, GM and Toyota and their customers; adoption by vehicle purchasers of Scout for Cars; Telenav's dependence on a limited number of automotive manufacturers and original equipment manufacturers ("OEMs") for a substantial portion of its revenue; Ford's announcement that it believes that the market for automobiles generally will not grow at the pace that it has been growing; the impact of changes in the timing of revenue recognition for our sales of MapCare to Ford for vehicles with SYNC 3 in Europe; potential impacts of OEMs including competitive capabilities in their vehicles such as Apple Car-Play and Android Auto; Telenav's success in achieving additional design wins from OEM and automotive manufacturers and the delivery dates of automobiles including Telenav's products; Telenav's ability to grow and scale its advertising business; Telenav's ability to develop new advertising products and technology while also achieving cash flow break even and ultimately profitability in the advertising business; Telenav incurring losses; competition from other market participants who may provide comparable services to subscribers without charge; the timing of new product releases and vehicle production by Telenav's automotive customers, including inventory procurement and fulfillment; possible warranty claims, and the impact on consumer perception of its brand; Telenav's ability to develop and support products including Open Street Maps ("OSM"), as well as transition existing navigation products to OSM and any economic benefit anticipated from the use of OSM versus proprietary map products; the potential that we may not be able to realize our deferred tax assets and may have to take a reserve against them; and macroeconomic and political conditions in the U.S. and abroad, in particular China. We discuss these risks in greater detail in "Risk factors" and elsewhere in our Form 10-Q for the three months ended September 30, 2016 and other filings with the U.S. Securities and Exchange Commission (SEC), which are available at the SEC's website at www.sec.gov. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Also, forward-looking statements represent our management's beliefs and assumptions only as of the date made. You should review our SEC filings carefully and with the understanding that our actual future results may be materially different from what we expect.

About Telenav, Inc.
Telenav is a leading provider of connected car and location-based platform services, focused on transforming life on the go for people — before, during, and after every drive. Leveraging our location platform, global brands such as Ford, GM, Toyota and AT&T deliver custom connected car and mobile experiences. Additionally, advertisers such as Denny's, Walmart, and Best Buy reach millions of users with our highly-targeted advertising platform. To learn more about how Telenav's location platform powers personalized navigation, mapping, big data intelligence, social driving, and location-based ads, visit www.telenav.com.

Copyright 2017 Telenav, Inc. All Rights Reserved.

TNAV-F
TNAV-C

Telenav, Inc.
Condensed Consolidated Balance Sheets
(in thousands, except par value)
     
  December 31,
2016
 June 30,
2016*
  (unaudited)  
Assets    
Current assets:    
Cash and cash equivalents $  17,694  $  21,349 
Short-term investments   85,988    88,277 
Accounts receivable, net of allowances of $42 and $111, at December 31, 2016 and June 30, 2016, respectively   47,815    42,216 
Restricted cash   4,094    5,109 
Income taxes receivable   648    687 
Deferred costs   3,919    1,784 
Prepaid expenses and other current assets   3,868    4,448 
Total current assets   164,026    163,870 
Property and equipment, net   4,795    5,247 
Deferred income taxes, non-current   435    661 
Goodwill and intangible assets, net   35,475    35,993 
Deferred costs, non-current   14,861    10,292 
Other assets   1,840    2,184 
Total assets $  221,432  $  218,247 
Liabilities and stockholders' equity    
Current liabilities:    
Trade accounts payable $  10,255  $  4,992 
Accrued expenses   41,374    36,274 
Deferred revenue   8,035    4,334 
Income taxes payable   242    88 
Total current liabilities   59,906    45,688 
Deferred rent, non-current   1,207    1,124 
Deferred revenue, non-current   28,062     19,035 
Other long-term liabilities   1,323    2,715 
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; 43,304 and 42,708 shares issued and outstanding at December 31, 2016 and June 30, 2016, respectively   43    43 
Additional paid-in capital   152,824    149,775 
Accumulated other comprehensive loss   (2,809)   (1,767)
Retained earnings (accumulated deficit)   (19,124)   1,634 
Total stockholders' equity   130,934    149,685 
Total liabilities and stockholders' equity $  221,432  $  218,247 
     
*Derived from audited consolidated financial statements as of and for the year ended June 30, 2016.
     

 

Telenav, Inc. 
Condensed Consolidated Statements of Operations 
(in thousands, except per share amounts) 
(unaudited) 
          
  Three Months Ended
December 31,
 Six Months Ended
December 31,
 
   2016   2015   2016   2015  
Revenue:         
Product $  37,804  $  31,160  $  67,227  $  62,269  
Services   14,197    14,093    27,001    27,045  
Total revenue   52,001    45,253    94,228     89,314  
Cost of revenue:         
Product   22,598    18,364    40,359    36,447  
Services   6,129    6,168    11,844    11,472  
Total cost of revenue   28,727    24,532    52,203    47,919  
Gross profit   23,274    20,721    42,025    41,395  
Operating expenses:          
Research and development   16,301    16,653    34,319    34,640  
Sales and marketing   5,277    6,524    10,545    13,522  
General and administrative   6,872    5,094    12,363    11,329  
Legal settlement and contingencies   6,424    750    6,424     750  
Restructuring    —    (1,468)   —    (1,468) 
Total operating expenses   34,874    27,553    63,651    58,773  
Loss from operations   (11,600)   (6,832)   (21,626)   (17,378) 
Other income (expense), net    714    520    1,010    333  
Loss before provision for income taxes   (10,886)   (6,312)   (20,616)   (17,045) 
Provision for income taxes   537    327    142     440  
Net loss $  (11,423) $  (6,639) $  (20,758) $  (17,485) 
          
Net loss per share:         
Basic and diluted $  (0.26) $  (0.16) $  (0.48) $  (0.43) 
          
Weighted average shares used in computing net loss per share:         
Basic and diluted   43,208    41,038    42,932    40,820  
          

 

Telenav, Inc. 
Condensed Consolidated Statements of Cash Flows 
(in thousands) 
(unaudited) 
      
  Six Months Ended
December 31,
 
   2016   2015  
Operating activities     
Net loss $  (20,758) $  (17,485) 
Adjustments to reconcile net loss to net cash used in operating activities:     
Depreciation and amortization   1,260    1,916  
Accretion of net premium on short-term investments   237    381  
Stock-based compensation expense   4,529    6,267  
Write-off of long term investments   —    477  
(Gain) loss on disposal of property and equipment   (2)   (4) 
Bad debt expense   125    51  
Changes in operating assets and liabilities:     
Accounts receivable   (5,724)   (1,007) 
Deferred income taxes   226    121  
Restricted cash   1,015    199  
Income taxes receivable   39    614  
Deferred costs   (6,704)    (4,302) 
Prepaid expenses and other current assets   580    (239) 
Other assets   98    908  
Trade accounts payable   5,309    80  
Accrued expenses and other liabilities   3,945    (1,010) 
Income taxes payable   154    162  
Deferred rent   44    (814) 
Deferred revenue   12,728    7,023  
   Net cash used in operating activities   (2,899)    (6,662) 
      
Investing activities     
Purchases of property and equipment   (531)   (332) 
Purchases of short-term investments   (37,788)   (20,622) 
Proceeds from sales and maturities of short-term investments   39,392    23,009  
Proceeds from sales of long-term investments   246    —  
   Net cash provided by investing activities   1,319    2,055  
      
Financing activities     
Proceeds from exercise of stock options   159    921  
Repurchase of common stock   —    (570) 
Tax withholdings related to net share settlements of restricted stock units   (1,638)   (1,796) 
   Net cash used in financing activities   (1,479)   (1,445) 
      
Effect of exchange rate changes on cash and cash equivalents   (596)   (576) 
Net decrease in cash and cash equivalents   (3,655)   (6,628) 
Cash and cash equivalents, at beginning of period   21,349    18,721  
Cash and cash equivalents, at end of period $  17,694  $  12,093  
      
Supplemental disclosure of cash flow information     
Income taxes paid (received), net $  1,410  $  (528) 
      

 

Telenav, Inc.
Condensed Consolidated Segment Summary
(in thousands, except percentages)
(unaudited)
         
  Three Months Ended
December 31,
 Six Months Ended
December 31,
   2016   2015    2016      2015   
Revenue:        
Automotive $  38,744  $  31,846  $  69,011  $  63,589 
Advertising   8,208    6,688    14,753    11,539 
Mobile Navigation   5,049    6,719     10,464    14,186 
Total revenue   52,001    45,253    94,228    89,314 
         
Cost of revenue:        
Automotive   23,438    18,931    41,983    37,452 
Advertising   3,919     3,755    7,445    6,750 
Mobile Navigation   1,370    1,846    2,775    3,717 
Total cost of revenue   28,727    24,532    52,203    47,919 
         
Gross profit:        
Automotive   15,306    12,915    27,028    26,137 
Advertising   4,289    2,933    7,308    4,789 
Mobile Navigation   3,679    4,873    7,689    10,469 
Total gross profit $  23,274  $  20,721  $  42,025  $  41,395 
         
Gross margin:        
Automotive  40%  41%  39%  41%
Advertising  52%  44%  50%  42%
Mobile Navigation  73%  73%  73%  74%
Total gross margin  45%  46%  45%  46%
          

 

Telenav, Inc.
Unaudited Reconciliation of Non-GAAP Adjustments
(in thousands)
                 
Reconciliation of Revenue to Billings (Non-GAAP)
                 
  Three Months Ended December 31, 2016 Six Months Ended December 31, 2016
  Automotive Advertising Mobile
Navigation
 Total Automotive Advertising  Mobile
Navigation
 Total
Revenue $  38,744 $  8,208 $  5,049  $  52,001 $  69,011 $  14,753 $  10,464  $  94,228
Adjustments:                
Change in deferred revenue   7,694   —   (8)   7,686   12,807   —   (79)   12,728
Billings (Non-GAAP) $  46,438 $  8,208 $  5,041   $  59,687 $  81,818 $  14,753 $  10,385  $  106,956
                 
                 
  Three Months Ended December 31, 2015 Six Months Ended December 31, 2015
  Automotive  Advertising Mobile Navigation Total Automotive  Advertising Mobile Navigation Total
Revenue $  31,846 $  6,688 $  6,719  $  45,253 $  63,589 $  11,539 $  14,186  $  89,314
Adjustments:                
Change in deferred revenue   3,434   —   (252)   3,182   7,251   —   (228)   7,023
Billings (Non-GAAP) $  35,280 $  6,688 $  6,467  $  48,435 $  70,840 $  11,539 $  13,958  $  96,337
                 

 

Telenav, Inc. 
Unaudited Reconciliation of Non-GAAP Adjustments 
(in thousands) 
          
Reconciliation of Gross Profit to Non-GAAP Gross Profit on Billings 
Reconciliation of Gross Margin to Non-GAAP Gross Margin on Billings 
          
  Three Months Ended
December 31,
 Six Months Ended
December 31,
 
   2016   2015   2016   2015  
          
Gross profit $  23,274  $  20,721  $  42,025  $  41,395  
Gross margin  45%  46%  45%  46% 
          
Adjustments to gross profit:          
Change in deferred revenue   7,686    3,182    12,728    7,023  
Change in deferred costs(1)   (3,847)   (1,629)   (6,704)    (4,302) 
Net change   3,839    1,553    6,024     2,721  
          
Non-GAAP gross profit on billings(1) $  27,113  $  22,274   $  48,049  $  44,116  
Non-GAAP gross margin on billings(1)  45%  46%  45%   46% 
          
          
(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 provisioning of services such as hosting, monitoring and customer support.  Accordingly, non-GAAP gross profit on billings and non-GAAP gross margin on billings do not reflect all costs associated with billings. 
           

 

Telenav, Inc.
Unaudited Reconciliation of Non-GAAP Adjustments
(in thousands)
         
Reconciliation of Deferred Revenue to Increase (Decrease) in Deferred Revenue
Reconciliation of Deferred Costs to Increase (Decrease) in Deferred Costs
         
  Three Months Ended December 31, 2016
  Automotive Advertising Mobile
Navigation
 Total
Deferred revenue, December 31 $  34,960  $  — $  1,137  $  36,097
Deferred revenue, September 30    27,266   —   1,145     28,411
Increase (decrease) in deferred revenue $  7,694 $  — $  (8) $  7,686
         
Deferred costs, December 31 $  18,780 $  — $  —  $  18,780
Deferred costs, September 30   14,933   —   —    14,933
Increase in deferred costs $  3,847 $  — $  —  $  3,847
         
  Three Months Ended December 31, 2015
  Automotive Advertising Mobile
Navigation
 Total
Deferred revenue, December 31 $  12,443 $  — $  1,408  $  13,851
Deferred revenue, September 30   9,009   —   1,660    10,669
Increase (decrease) in deferred revenue $  3,434 $  — $  (252) $  3,182
         
Deferred costs, December 31 $  7,443 $  — $  —  $  7,443
Deferred costs, September 30   5,814   —   —    5,814
Increase in deferred costs $  1,629 $  — $  —  $  1,629
         
  Six Months Ended December 31, 2016
  Automotive Advertising Mobile
Navigation
 Total
Deferred revenue, December 31 $  34,960 $  — $  1,137  $  36,097
Deferred revenue, June 30   22,153   —   1,216    23,369
Increase (decrease) in deferred revenue $  12,807 $  — $  (79) $  12,728
         
Deferred costs, December 31 $  18,780 $  — $  —  $  18,780
Deferred costs, June 30   12,076   —   —    12,076
Increase in deferred costs $  6,704 $  — $  —  $  6,704
         
  Six Months Ended December 31, 2015
  Automotive Advertising Mobile
Navigation
 Total
Deferred revenue, December 31 $  12,443 $  — $  1,408  $  13,851
Deferred revenue, June 30   5,192   —   1,636    6,828
Increase (decrease) in deferred revenue $  7,251 $  — $  (228 ) $  7,023
         
Deferred costs, December 31 $  7,443 $  — $  —  $  7,443
Deferred costs, June 30   3,141    —   —     3,141
Increase in deferred costs $  4,302 $  — $  —  $  4,302
         

 

Telenav, Inc.  
Unaudited Reconciliation of Non-GAAP Adjustments 
(in thousands) 
          
Reconciliation of Net Loss to Adjusted EBITDA and Adjusted EBITDA on Billings 
          
  Three Months Ended
December 31,
 Six Months Ended
December 31,
 
    2016   2015    2016   2015  
          
Net loss $  (11,423) $  (6,639) $  (20,758) $  (17,485) 
          
Adjustments:         
Legal settlement and contingencies   6,424    750    6,424    750  
Restructuring accrual (reversal)   —    (1,468)   —    (1,468) 
Deferred rent reversal due to lease termination   —    (621)   —    (621) 
Stock-based compensation expense   1,988    3,180    4,529    6,267   
Depreciation and amortization expense   623    847    1,260    1,916  
Other income (expense), net   (714)   (520)   (1,010)   (333) 
Provision for income taxes   537    327    142    440  
Adjusted EBITDA $  (2,565) $  (4,144) $  (9,413) $  (10,534) 
          
Change in deferred revenue   7,686    3,182    12,728    7,023  
Change in deferred costs(1)   (3,847)   (1,629)   (6,704)   (4,302) 
Adjusted EBITDA on billings(1) $  1,274  $  (2,591) $  (3,389) $  (7,813) 
          
          
(1) We expect to incur additional costs in the future due to requirements to provide ongoing provisioning of services such as hosting, monitoring and customer support.  Accordingly, adjusted EBITDA on billings 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
December 31,
 Six Months Ended
December 31,
  
   2016   2015    2016   2015   
           
Net loss $  (11,423) $  (6,639) $  (20,758)  $  (17,485)  
           
Adjustments to reconcile net loss to net cash used in operating activities:           
Increase in deferred revenue (1)   7,686    3,182    12,728    7,023   
Increase in deferred costs (2)   (3,847)   (1,629)   (6,704)   (4,302)  
Changes in other operating assets and liabilities   7,595    81    5,686    (986)  
Other adjustments (3)   2,779    4,212    6,149    9,088   
Net cash used in operating activities   2,790    (793)   (2,899)   (6,662)  
Less: Purchases of property and equipment   (137)   (90)   (531)   (332)  
Free cash flow  $  2,653  $  (883) $  (3,430) $  (6,994)  
           
(1) Consists of royalties, customized software development fees and subscription fees.  
(2) Consists primarily of third party content costs and customized software development expenses.  
(3) Consist primarily of depreciation and amortization, stock-based compensation expense and other non-cash items.  
           

 

Telenav, Inc.  
Unaudited Reconciliation of Non-GAAP Adjustments  
(in thousands)  
               
Non-GAAP metrics for the Advertising segment and the combined Automotive and Mobile Navigation segments  
               
  Three Months Ended December 31, 2016  
  GAAP
Consolidated
 Non-GAAP
Consolidated
 Non-GAAP
Advertising
 Automotive (1) Mobile
Navigation
(1)
 Total Non-GAAP
Automotive and
Mobile Navigation
(1)
  
               
Revenue $  52,001    $  8,208  $  38,744 $  5,049 $  43,793   
Cost of revenue   28,727      3,919    23,438   1,370   24,808   
Gross profit   23,274      4,289  $  15,306 $  3,679   18,985   
Operating expenses:              
Research and development   16,301      1,235  (2)      15,066   
Sales and marketing   5,277      2,568  (2)      2,709   
General and administrative   6,872      410  (3)       6,462   
Legal settlement and contingencies   6,424      —  (4)      6,424   
Total operating expenses    34,874      4,213        30,661   
Income (loss) from operations   (11,600)     76        (11,676)   
Other income (expense), net   714      —  (5)      714   
Income (loss) before provision for income taxes   (10,886)      76        (10,962 )  
Provision for income taxes   537      —  (6)      537   
Net income (loss) $  (11,423) $  (11,423) $  76      $  (11,499)  
               
Adjustments:              
Legal settlement and contingencies     6,424    —  (4)      6,424   
Stock-based compensation expense     1,988    286  (2)      1,702   
Depreciation and amortization expense     623    51  (2)      572   
Other income (expense), net     (714)   —  (5)       (714)  
Provision for income taxes     537    —  (6)      537   
Adjusted EBITDA   $  (2,565) $  413      $  (2,978)  
Change in deferred revenue     7,686    —        7,686   
Change in deferred costs(7)     (3,847)   —        (3,847)  
Adjusted EBITDA on billings(7)   $  1,274  $  413      $  861   
               
(1) Automotive and mobile navigation segments share many of the same technologies and resources. Accordingly, we are unable to fully attribute the operating expenses, other income (expense), net and provision (benefit) for income taxes to one segment versus the other.  
               
For purposes of calculating the Non-GAAP net loss attributable to the advertising segment:  
(2) These expenses represent costs directly attributable to the advertising segment.   
(3) These expenses represent actual general and administrative costs directly attributable to the advertising segment as well as an allocation of certain shared corporate costs that directly benefit the advertising segment, such as accounting and human resources.   
(4) Legal settlement and contingencies are not related to the advertising segment.  
(5) Expenses or income cannot be directly allocated to the advertising segment.  
(6) Income taxes are primarily from foreign operations which support the automotive and mobile navigation segments.  
(7) We expect to incur additional costs in the future due to requirements to provide ongoing provisioning of services such as hosting, monitoring and customer support.  Accordingly, adjusted EBITDA on billings does not reflect all costs associated with billings.  
               
Telenav, Inc.  
Unaudited Reconciliation of Non-GAAP Adjustments  
(in thousands)  
               
Non-GAAP metrics for the Advertising segment and the combined Automotive and Mobile Navigation segments  
               
  Three Months Ended December 31, 2015  
  GAAP
Consolidated
 Non-GAAP
Consolidated
 Non-GAAP
Advertising
 Automotive (1) Mobile
Navigation
(1)
 Total Non-GAAP
Automotive and
Mobile Navigation
(1)
  
                
Revenue $  45,253    $  6,688  $  31,846 $  6,719 $  38,565   
Cost of revenue   24,532      3,755    18,931   1,846   20,777   
Gross profit   20,721      2,933  $  12,915 $  4,873   17,788   
Operating expenses:              
Research and development   16,653      1,051  (2)      15,602   
Sales and marketing   6,524      3,661  (2)      2,863   
General and administrative   5,094      503  (3)       4,591   
Legal settlement and contingencies   750      —  (4)      750   
Restructuring   (1,468)     (375) (2 )      (1,093)  
Total operating expenses   27,553      4,840        22,713   
Loss from operations   (6,832)     (1,907)       (4,925)  
Other income (expense), net   520      —  (5)      520   
Loss before provision for income taxes   (6,312)      (1,907)       (4,405)  
Provision for income taxes   327      —  (6)       327   
Net loss $  (6,639) $  (6,639) $  (1,907)     $  (4,732)  
               
Adjustments:              
Legal settlement and contingencies     750    —  (4)      750   
Stock-based compensation expense     3,180    337  (2)      2,843   
Restructuring     (1,468)   (375) (2)      (1,093)  
Deferred rent reversal due to lease termination     (621)   (159) (2)       (462)  
Depreciation and amortization expense     847    203  (2)      644   
Other income (expense), net     (520)   —  (5)       (520)  
Provision for income taxes     327    —  (6)      327   
Adjusted EBITDA   $  (4,144) $  (1,901)     $  (2,243)  
Change in deferred revenue     3,182    —        3,182   
Change in deferred costs(7)     (1,629)   —        (1,629)  
Adjusted EBITDA on billings(7)   $  (2,591) $  (1,901)     $  (690)  
               
(1) Automotive and mobile navigation segments share many of the same technologies and resources. Accordingly, we are unable to fully attribute the operating expenses, other income (expense), net and provision (benefit) for income taxes to one segment versus the other.  
               
For purposes of calculating the Non-GAAP net loss attributable to the advertising segment:  
(2) These expenses represent costs directly attributable to the advertising segment.   
(3) These expenses represent actual general and administrative costs directly attributable to the advertising segment as well as an  allocation of certain shared corporate costs that directly benefit the advertising segment, such as accounting and human resources.   
(4) Legal settlement and contingencies are not related to the advertising segment.  
(5) Expenses or income cannot be directly allocated to the advertising segment.  
(6) Income taxes are primarily from foreign operations which support the automotive and mobile navigation segments.  
(7) We expect to incur additional costs in the future due to requirements to provide ongoing provisioning of services such as hosting, monitoring and customer support.  Accordingly, adjusted EBITDA on billings does not reflect all costs associated with billings.  
               
Telenav, Inc.  
Unaudited Reconciliation of Non-GAAP Adjustments  
(in thousands)  
               
Non-GAAP metrics for the Advertising segment and the combined Automotive and Mobile Navigation segments  
               
  Six Months Ended December 31, 2016  
  GAAP
Consolidated
 Non-GAAP
Consolidated
 Non-GAAP
Advertising
 Automotive (1) Mobile
Navigation
(1)
 Total Non-GAAP
Automotive and
Mobile Navigation
(1)
  
                
Revenue $  94,228    $  14,753  $  69,011 $  10,464 $  79,475   
Cost of revenue   52,203      7,445    41,983   2,775   44,758   
Gross profit   42,025      7,308  $  27,028 $  7,689   34,717   
Operating expenses:              
Research and development   34,319      2,408  (2)      31,911   
Sales and marketing   10,545      5,038  (2)      5,507   
General and administrative   12,363      873  (3)       11,490   
Legal settlement and contingencies   6,424      —  (4)      6,424   
Total operating expenses   63,651      8,319        55,332   
Loss from operations   (21,626)     (1,011)       (20,615)  
Other income (expense), net   1,010      —  (5)      1,010   
Loss before provision for income taxes   (20,616)      (1,011)       (19,605)  
Provision for income taxes   142      —  (6)       142   
Net loss $  (20,758) $  (20,758) $  (1,011)     $  (19,747)  
               
Adjustments:              
Legal settlement and contingencies     6,424    —  (4)      6,424   
Stock-based compensation expense     4,529    485  (2)      4,044   
Depreciation and amortization expense     1,260    103  (2)      1,157   
Other income (expense), net     (1,010)    —  (5)      (1,010 )  
Provision for income taxes     142    —  (6)       142   
Adjusted EBITDA   $  (9,413) $  (423)     $  (8,990)  
Change in deferred revenue     12,728    —        12,728   
Change in deferred costs(7)     (6,704)   —        (6,704)  
Adjusted EBITDA on billings(7)   $  (3,389) $  (423)     $  (2,966)  
                
(1) Automotive and mobile navigation segments share many of the same technologies and resources. Accordingly, we are unable to fully attribute the operating expenses, other income (expense), net and provision (benefit) for income taxes to one segment versus the other.  
               
For purposes of calculating the Non-GAAP net loss attributable to the advertising segment:  
(2) These expenses represent costs directly attributable to the advertising segment.   
(3) These expenses represent actual general and administrative costs directly attributable to the advertising segment as well as an  allocation of certain shared corporate costs that directly benefit the advertising segment, such as accounting and human resources.   
(4) Legal settlement and contingencies are not related to the advertising segment.  
(5) Expenses or income cannot be directly allocated to the advertising segment.  
(6) Income taxes are primarily from foreign operations which support the automotive and mobile navigation segments.  
(7) We expect to incur additional costs in the future due to requirements to provide ongoing provisioning of services such as hosting, monitoring and customer support.  Accordingly, adjusted EBITDA on billings does not reflect all costs associated with billings.  
               
Telenav, Inc.  
Unaudited Reconciliation of Non-GAAP Adjustments  
(in thousands)  
               
Non-GAAP metrics for the Advertising segment and the combined Automotive and Mobile Navigation segments  
               
  Six Months Ended December 31, 2015  
   GAAP
Consolidated
 Non-GAAP
Consolidated
 Non-GAAP
Advertising
  Automotive (1) Mobile
Navigation
(1)
 Total Non-GAAP
Automotive and
Mobile Navigation
(1)
  
               
Revenue $  89,314    $  11,539  $  63,589 $  14,186 $  77,775   
Cost of revenue   47,919      6,750    37,452   3,717   41,169   
Gross profit   41,395      4,789  $  26,137 $  10,469   36,606   
Operating expenses:               
Research and development   34,640      2,530  (2)      32,110   
Sales and marketing   13,522      7,491  (2)      6,031   
General and administrative   11,329      1,044  (3)      10,285   
Legal settlement and contingencies   750      —  (4)      750   
Restructuring   (1,468)     (375) (2)      (1,093)  
Total operating expenses   58,773      10,690        48,083   
Loss from operations   (17,378)     (5,901)        (11,477)  160
Other income (expense), net   333      —  (5)      333   
Loss before provision for income taxes   (17,045)     (5,901)       (11,144)  
Provision for income taxes   440      —  (6)      440   
Net loss $  (17,485) $  (17,485) $  (5,901)     $  (11,584)  
               
Adjustments:              
Legal settlement and contingencies     750    —  (4)      750   
Stock-based compensation expense     6,267    659  (2)      5,608   
Restructuring     (1,468)   (375) (2)      (1,093)  
Deferred rent reversal due to lease termination      (621)   (159) (2)      (462)  
Depreciation and amortization expense     1,916    656  (2)      1,260   
Other income (expense), net     (333)   —  (5)      (333)  
Provision for income taxes     440    —  (6)      440   
Adjusted EBITDA   $  (10,534) $  (5,120)     $  (5,414)  
Change in deferred revenue     7,023    —        7,023   
Change in deferred costs(7)     (4,302)   —        (4,302)  
Adjusted EBITDA on billings (7)   $  (7,813) $  (5,120)     $  (2,693)  
               
(1) Automotive and mobile navigation segments share many of the same technologies and resources. Accordingly, we are unable to fully attribute the operating expenses, other income (expense), net and provision (benefit) for income taxes to one segment versus the other.  
               
For purposes of calculating the Non-GAAP net loss attributable to the advertising segment:  
(2) These expenses represent costs directly attributable to the advertising segment.   
(3) These expenses represent actual general and administrative costs directly attributable to the advertising segment as well as an  allocation of certain shared corporate costs that directly benefit the advertising segment, such as accounting and human resources.   
(4) Legal settlement and contingencies are not related to the advertising segment.  
(5) Expenses or income cannot be directly allocated to the advertising segment.  
(6) Income taxes are primarily from foreign operations which support the automotive and mobile navigation segments.  
(7) We expect to incur additional costs in the future due to requirements to provide ongoing provisioning of services such as hosting, monitoring and customer support.  Accordingly, adjusted EBITDA on billings does not reflect all costs associated with billings.  

  


Investor Relations Contact:

Mike Look, Telenav, Inc.

408-990-1265

IR@telenav.com

Primary Logo

Source: Telenav, Inc.

News Provided by Acquire Media


Close window | Back to top

Copyright 2017 Telenav, Inc.