Delaware | 001-33508 | 20-1677033 | ||
(State or other jurisdiction of incorporation or organization) | (Commission File Number) | (I.R.S. Employer Identification Number) |
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 | Results of Operations and Financial Condition. |
Item 9.01 | Financial Statements and Exhibits. |
Exhibit Number | Description | |
99.1 | Limelight Networks, Inc. Press Release dated April 27, 2016 (furnished herewith). |
LIMELIGHT NETWORKS, INC. | ||||||
Dated: April 27, 2016 | By: | /s/ Michael DiSanto | ||||
Michael DiSanto Chief Administrative and Legal Officer & Secretary |
Exhibit Number | Description | |
99.1 | Limelight Networks, Inc. Press Release dated April 27, 2016 (furnished herewith). |
• | Q1 Revenue of $41.4 million |
• | GAAP Gross margin of 40.2%, up 120 basis points |
• | GAAP EPS of $(0.06), Non-GAAP EPS of $(0.01) |
March 31, 2016 | December 31, 2015 | ||||||
(Unaudited) | |||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 24,141 | $ | 44,680 | |||
Marketable securities | — | 28,322 | |||||
Accounts receivable, net | 27,452 | 26,795 | |||||
Income taxes receivable | 186 | 170 | |||||
Deferred income taxes | 83 | 89 | |||||
Prepaid expenses and other current assets | 6,054 | 9,578 | |||||
Total current assets | 57,916 | 109,634 | |||||
Property and equipment, net | 33,330 | 36,143 | |||||
Marketable securities, less current portion | 40 | 40 | |||||
Restricted cash | 62,790 | — | |||||
Deferred income taxes, less current portion | 1,207 | 1,252 | |||||
Goodwill | 76,370 | 76,143 | |||||
Other assets | 2,071 | 2,415 | |||||
Total assets | $ | 233,724 | $ | 225,627 | |||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 7,585 | $ | 9,137 | |||
Deferred revenue | 3,379 | 2,890 | |||||
Capital lease obligations | 821 | 466 | |||||
Income taxes payable | 85 | 204 | |||||
Other current liabilities | 8,619 | 10,857 | |||||
Total current liabilities | 20,489 | 23,554 | |||||
Long-term debt | 12,790 | — | |||||
Capital lease obligations, less current portion | 2,345 | 1,436 | |||||
Deferred income taxes | 141 | 137 | |||||
Deferred revenue, less current portion | 77 | 92 | |||||
Other long-term liabilities | 2,137 | 2,311 | |||||
Total liabilities | 37,979 | 27,530 | |||||
Commitments and contingencies | |||||||
Stockholders’ equity: | |||||||
Convertible preferred stock, $0.001 par value; 7,500 shares authorized; no shares issued and outstanding | — | — | |||||
Common stock, $0.001 par value; 300,000 shares authorized; 103,399 and 102,299 shares issued and outstanding at March 31, 2016 and December 31, 2015, respectively | 103 | 102 | |||||
Additional paid-in capital | 480,092 | 477,202 | |||||
Accumulated other comprehensive loss | (10,109 | ) | (10,812 | ) | |||
Accumulated deficit | (274,341 | ) | (268,395 | ) | |||
Total stockholders’ equity | 195,745 | 198,097 | |||||
Total liabilities and stockholders’ equity | $ | 233,724 | $ | 225,627 |
Three Months Ended | |||||||||||||||||
March 31, | Dec. 31, | Percent | March 31, | Percent | |||||||||||||
2016 | 2015 | Change | 2015 | Change | |||||||||||||
Revenues | $ | 41,422 | $ | 42,739 | (3 | )% | $ | 42,329 | (2 | )% | |||||||
Cost of revenue: | |||||||||||||||||
Cost of services (1) | 20,110 | 20,388 | (1 | )% | 21,657 | (7 | )% | ||||||||||
Depreciation — network | 4,668 | 4,811 | (3 | )% | 4,153 | 12 | % | ||||||||||
Total cost of revenue | 24,778 | 25,199 | (2 | )% | 25,810 | (4 | )% | ||||||||||
Gross profit | 16,644 | 17,540 | (5 | )% | 16,519 | 1 | % | ||||||||||
Gross profit percentage | 40.2 | % | 41.0 | % | 39.0 | % | |||||||||||
Operating expenses: | |||||||||||||||||
General and administrative (1) | 6,808 | 5,509 | 24 | % | 6,850 | (1 | )% | ||||||||||
Sales and marketing (1) | 8,903 | 8,101 | 10 | % | 10,276 | (13 | )% | ||||||||||
Research and development (1) | 6,325 | 6,678 | (5 | )% | 6,263 | 1 | % | ||||||||||
Depreciation and amortization | 623 | 1,005 | (38 | )% | 640 | (3 | )% | ||||||||||
Total operating expenses | 22,659 | 21,293 | 6 | % | 24,029 | (6 | )% | ||||||||||
Operating loss | (6,015 | ) | (3,753 | ) | 60 | % | (7,510 | ) | (20 | )% | |||||||
Other income (expense): | |||||||||||||||||
Interest expense | (179 | ) | (25 | ) | 616 | % | (4 | ) | 4,375 | % | |||||||
Interest income | 6 | 86 | (93 | )% | 74 | (92 | )% | ||||||||||
Other, net | 400 | (407 | ) | (198 | )% | 1,812 | (78 | )% | |||||||||
Total other income (expense) | 227 | (346 | ) | (166 | )% | 1,882 | (88 | )% | |||||||||
Loss before income taxes | (5,788 | ) | (4,099 | ) | 41 | % | (5,628 | ) | 3 | % | |||||||
Income tax expense | 158 | 46 | 243 | % | 55 | 187 | % | ||||||||||
Net loss | $ | (5,946 | ) | $ | (4,145 | ) | 43 | % | $ | (5,683 | ) | 5 | % | ||||
Net loss per share: | |||||||||||||||||
Basic and diluted | $ | (0.06 | ) | $ | (0.04 | ) | $ | (0.06 | ) | ||||||||
Weighted average shares used in per share calculation: | |||||||||||||||||
Basic and diluted | 102,693 | 101,391 | 98,636 | ||||||||||||||
(1) Includes share-based compensation (see supplemental table for figures) |
Three Months Ended | |||||||||||
March 31, | Dec. 31, | March 31, | |||||||||
2016 | 2015 | 2015 | |||||||||
Share-based compensation: | |||||||||||
Cost of services | $ | 473 | $ | 563 | $ | 513 | |||||
General and administrative | 1,826 | 1,002 | 1,406 | ||||||||
Sales and marketing | 737 | 716 | 689 | ||||||||
Research and development | 460 | 582 | 461 | ||||||||
Total share-based compensation | $ | 3,496 | $ | 2,863 | $ | 3,069 | |||||
Depreciation and amortization: | |||||||||||
Network-related depreciation | $ | 4,668 | $ | 4,811 | $ | 4,153 | |||||
Other depreciation and amortization | 617 | 544 | 443 | ||||||||
Amortization of intangible assets | 6 | 461 | 197 | ||||||||
Total depreciation and amortization | $ | 5,291 | $ | 5,816 | $ | 4,793 | |||||
Net increase (decrease) in cash, cash equivalents and marketable securities: | $ | (48,861 | ) | $ | 3,427 | $ | (12,140 | ) | |||
End of period statistics: | |||||||||||
Approximate number of active customers | 926 | 963 | 1,080 | ||||||||
Number of employees and employee equivalents | 501 | 509 | 533 |
Three Months Ended | |||||||||||
Mar. 31, | Dec. 31, | Mar. 31, | |||||||||
2016 | 2015 | 2015 | |||||||||
Operating activities | |||||||||||
Net loss | $ | (5,946 | ) | $ | (4,145 | ) | $ | (5,683 | ) | ||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | |||||||||||
Depreciation and amortization | 5,291 | 5,816 | 4,793 | ||||||||
Share-based compensation | 3,496 | 2,863 | 3,069 | ||||||||
Foreign currency remeasurement (gain) loss | (301 | ) | 492 | (1,691 | ) | ||||||
Deferred income taxes | 82 | 67 | (53 | ) | |||||||
Accounts receivable charges | (116 | ) | 299 | 246 | |||||||
Amortization of premium on marketable securities | 19 | 42 | 58 | ||||||||
Realized loss on marketable securities | 32 | — | — | ||||||||
Changes in operating assets and liabilities: | |||||||||||
Accounts receivable | (540 | ) | 57 | (4,980 | ) | ||||||
Prepaid expenses and other current assets | 3,583 | (490 | ) | 1,150 | |||||||
Income taxes receivable | (13 | ) | 9 | (2 | ) | ||||||
Other assets | 342 | 1,477 | 792 | ||||||||
Accounts payable and other current liabilities | (4,005 | ) | (425 | ) | (1,723 | ) | |||||
Deferred revenue | 473 | (681 | ) | (203 | ) | ||||||
Income taxes payable | (127 | ) | (2 | ) | (52 | ) | |||||
Other long term liabilities | 900 | 1,358 | (269 | ) | |||||||
Net cash provided by (used in) operating activities | 3,170 | 6,737 | (4,548 | ) | |||||||
Investing activities | |||||||||||
Purchases of marketable securities | — | — | (9,956 | ) | |||||||
Sale and maturities of marketable securities | 28,315 | 5,700 | 9,840 | ||||||||
Restricted cash | (62,790 | ) | — | — | |||||||
Purchases of property and equipment | (1,421 | ) | (3,960 | ) | (6,666 | ) | |||||
Net cash (used in) provided by investing activities | (35,896 | ) | 1,740 | (6,782 | ) | ||||||
Financing activities | |||||||||||
Principal payments on capital lease obligations | (159 | ) | (95 | ) | (358 | ) | |||||
Payment of employee tax withholdings related to restricted stock vesting | (646 | ) | (348 | ) | (1,107 | ) | |||||
Cash paid for purchase of common stock | — | — | (957 | ) | |||||||
Proceeds from line of credit | 12,790 | — | — | ||||||||
Proceeds from employee stock plans | 43 | 1,287 | 1,975 | ||||||||
Net cash provided by (used in) financing activities | 12,028 | 844 | (447 | ) | |||||||
Effect of exchange rate changes on cash and cash equivalents | 159 | (93 | ) | (482 | ) | ||||||
Net (decrease) increase in cash and cash equivalents | (20,539 | ) | 9,228 | (12,259 | ) | ||||||
Cash and cash equivalents, beginning of period | 44,680 | 35,452 | 57,767 | ||||||||
Cash and cash equivalents, end of period | $ | 24,141 | $ | 44,680 | $ | 45,508 |
• | EBITDA and Adjusted EBITDA do not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments; |
• | these measures do not reflect changes in, or cash requirements for, our working capital needs; |
• | Adjusted EBITDA does not reflect the cash requirements necessary for litigation costs; |
• | these measures do not reflect the interest expense, or the cash requirements necessary to service interest or principal payments, on our debt that we may incur; |
• | these measures do not reflect income taxes or the cash requirements for any tax payments; |
• | although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will be replaced sometime in the future, and EBITDA and Adjusted EBITDA do not reflect any cash requirements for such replacements; |
• | while share-based compensation is a component of operating expense, the impact on our financial statements compared to other companies can vary significantly due to such factors as the assumed life of the options and the assumed volatility of our common stock; and |
• | other companies may calculate EBITDA and Adjusted EBITDA differently than we do, limiting their usefulness as comparative measures. |
Three Months Ended | |||||||||||||||||||||||
March 31, 2016 | December 31, 2015 | March 31, 2015 | |||||||||||||||||||||
Amount | Per Share | Amount | Per Share | Amount | Per Share | ||||||||||||||||||
U.S. GAAP net loss | $ | (5,946 | ) | $ | (0.06 | ) | $ | (4,145 | ) | $ | (0.04 | ) | $ | (5,683 | ) | $ | (0.06 | ) | |||||
Share-based compensation | 3,496 | 0.03 | 2,863 | 0.03 | 3,069 | 0.03 | |||||||||||||||||
Litigation expenses | 1,178 | 0.01 | 402 | — | 19 | — | |||||||||||||||||
Amortization of intangible assets | 6 | — | 461 | — | 197 | — | |||||||||||||||||
Non-GAAP net loss | $ | (1,266 | ) | $ | (0.01 | ) | $ | (419 | ) | $ | — | $ | (2,398 | ) | $ | (0.02 | ) | ||||||
Weighted average shares used in per share calculation: | 102,693 | 101,391 | 98,636 |
Three Months Ended | |||||||||||
March 31, | December 31, | March 31, | |||||||||
2016 | 2015 | 2015 | |||||||||
U.S. GAAP net loss | $ | (5,946 | ) | $ | (4,145 | ) | $ | (5,683 | ) | ||
Depreciation and amortization | 5,291 | 5,816 | 4,793 | ||||||||
Interest expense | 179 | 25 | 4 | ||||||||
Interest and other (income) expense | (406 | ) | 321 | (1,886 | ) | ||||||
Income tax expense | 158 | 46 | 55 | ||||||||
EBITDA | $ | (724 | ) | $ | 2,063 | $ | (2,717 | ) | |||
Share-based compensation | 3,496 | 2,863 | 3,069 | ||||||||
Litigation expenses | 1,178 | 402 | 19 | ||||||||
Adjusted EBITDA | $ | 3,950 | $ | 5,328 | $ | 371 |