2017 Q3 Form 10-Q Financial Statement

#000089110317000022 Filed on November 09, 2017

View on sec.gov

Income Statement

Concept 2017 Q3 2016 Q4 2016 Q3
Revenue $828.4M $811.2M $764.1M
YoY Change 8.42% -4.43% -8.88%
Cost Of Revenue $166.3M $212.5M $179.1M
YoY Change -7.17% -0.75% -10.15%
Gross Profit $662.1M $598.7M $585.0M
YoY Change 13.19% -5.66% -8.48%
Gross Profit Margin 79.93% 73.81% 76.56%
Selling, General & Admin $588.5M $98.60M $417.5M
YoY Change 40.96% 82.59% -12.52%
% of Gross Profit 88.87% 16.47% 71.37%
Research & Development $70.65M $19.70M $49.70M
YoY Change 42.13% 49.24% 6.07%
% of Gross Profit 10.67% 3.29% 8.5%
Depreciation & Amortization $17.26M $9.500M $17.95M
YoY Change -3.83% -1457.14% 14.89%
% of Gross Profit 2.61% 1.59% 3.07%
Operating Expenses $659.1M $127.8M $467.2M
YoY Change 41.08% 92.18% -10.86%
Operating Profit -$18.59M $112.8M $85.58M
YoY Change -121.72% -2177.72% -1.77%
Interest Expense $25.04M -$20.30M $27.12M
YoY Change -7.68% 6.84% 69.57%
% of Operating Profit -17.99% 31.69%
Other Income/Expense, Net -$10.22M $3.500M $11.70M
YoY Change -187.32% 6.06% -65.99%
Pretax Income -$53.84M $96.10M $70.17M
YoY Change -176.73% 34.78% -33.51%
Income Tax $257.0M $21.30M $17.83M
% Of Pretax Income 22.16% 25.41%
Net Earnings $179.6M $102.1M $43.16M
YoY Change 316.21% -420.42% -34.22%
Net Earnings / Revenue 21.68% 12.58% 5.65%
Basic Earnings Per Share $2.22 $1.29 $0.54
Diluted Earnings Per Share $1.79 $1.18 $0.49
COMMON SHARES
Basic Shares Outstanding 80.82M shares 79.53M shares
Diluted Shares Outstanding 87.20M shares 81.62M shares

Balance Sheet

Concept 2017 Q3 2016 Q4 2016 Q3
SHORT-TERM ASSETS
Cash & Short-Term Investments $157.6M $253.7M $1.368B
YoY Change -88.48% -83.19% 66.8%
Cash & Equivalents $1.255B $1.329B $1.190B
Short-Term Investments $177.9M
Other Short-Term Assets $200.4M $204.1M $232.6M
YoY Change -13.84% 17.09% 30.0%
Inventory
Prepaid Expenses $37.67M
Receivables $271.2M $220.1M $199.3M
Other Receivables $0.00 $0.00 $0.00
Total Short-Term Assets $1.727B $1.843B $1.800B
YoY Change -4.04% -5.26% 44.4%
LONG-TERM ASSETS
Property, Plant & Equipment $320.3M $306.2M $317.3M
YoY Change 0.95% 1.13% 6.09%
Goodwill $2.502B $1.924B $1.943B
YoY Change 28.78% -14.31% 9.8%
Intangibles $660.1M $355.5M $382.3M
YoY Change 72.67% -19.37% -16.88%
Long-Term Investments $0.00 $0.00 $0.00
YoY Change -100.0%
Other Assets $81.40M $92.07M $102.6M
YoY Change -20.7% -21.5% -10.04%
Total Long-Term Assets $3.814B $2.803B $2.872B
YoY Change 32.82% -13.58% 3.26%
TOTAL ASSETS
Total Short-Term Assets $1.727B $1.843B $1.800B
Total Long-Term Assets $3.814B $2.803B $2.872B
Total Assets $5.541B $4.646B $4.671B
YoY Change 18.62% -10.46% 15.99%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $18.30M $7.400M $20.20M
YoY Change -9.41% -71.32% -0.49%
Accrued Expenses $387.3M $344.9M $346.1M
YoY Change 11.91% -10.0% -0.28%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00 $0.00
YoY Change
Long-Term Debt Due $0.00 $20.00M $0.00
YoY Change -50.0%
Total Short-Term Liabilities $835.5M $713.4M $702.6M
YoY Change 18.92% -7.18% 7.52%
LONG-TERM LIABILITIES
Long-Term Debt $1.649B $1.582B $1.641B
YoY Change 0.49% -8.37% 64.13%
Other Long-Term Liabilities $37.17M $44.18M $39.24M
YoY Change -5.3% -31.52% -37.19%
Total Long-Term Liabilities $1.686B $1.627B $1.681B
YoY Change 0.35% -9.2% 58.17%
TOTAL LIABILITIES
Total Short-Term Liabilities $835.5M $713.4M $702.6M
Total Long-Term Liabilities $1.686B $1.627B $1.681B
Total Liabilities $2.522B $2.340B $2.383B
YoY Change 5.83% -8.59% 38.88%
SHAREHOLDERS EQUITY
Retained Earnings $562.2M $290.1M $188.1M
YoY Change 198.96% -12.46% -51.96%
Common Stock $12.19B $11.92B $11.91B
YoY Change 2.4% 3.79% 3.91%
Preferred Stock
YoY Change
Treasury Stock (at cost) $10.23B $10.18B $10.11B
YoY Change 1.17% 3.2% 2.51%
Treasury Stock Shares 194.2M shares 193.4M shares 192.4M shares
Shareholders Equity $2.429B $1.869B $1.864B
YoY Change
Total Liabilities & Shareholders Equity $5.541B $4.646B $4.671B
YoY Change 18.62% -10.46% 15.99%

Cashflow Statement

Concept 2017 Q3 2016 Q4 2016 Q3
OPERATING ACTIVITIES
Net Income $179.6M $102.1M $43.16M
YoY Change 316.21% -420.42% -34.22%
Depreciation, Depletion And Amortization $17.26M $9.500M $17.95M
YoY Change -3.83% -1457.14% 14.89%
Cash From Operating Activities $76.40M $69.00M $75.70M
YoY Change 0.92% -43.12% 131.5%
INVESTING ACTIVITIES
Capital Expenditures -$6.800M -$9.100M -$18.00M
YoY Change -62.22% 71.7% 81.82%
Acquisitions
YoY Change
Other Investing Activities -$4.000M $2.800M -$1.000M
YoY Change 300.0% -100.49% -86.3%
Cash From Investing Activities -$10.80M -$6.300M -$19.00M
YoY Change -43.16% -98.91% 11.11%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -405.6M -33.30M -2.300M
YoY Change 17534.78% -112.4% -101.73%
NET CHANGE
Cash From Operating Activities 76.40M 69.00M 75.70M
Cash From Investing Activities -10.80M -6.300M -19.00M
Cash From Financing Activities -405.6M -33.30M -2.300M
Net Change In Cash -340.0M 29.40M 54.40M
YoY Change -725.0% -115.47% -63.47%
FREE CASH FLOW
Cash From Operating Activities $76.40M $69.00M $75.70M
Capital Expenditures -$6.800M -$9.100M -$18.00M
Free Cash Flow $83.20M $78.10M $93.70M
YoY Change -11.21% -38.31% 119.95%

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CY2017Q3 us-gaap Revenues
Revenues
828434000 USD
us-gaap Revenues
Revenues
2356654000 USD
CY2016Q3 us-gaap Selling And Marketing Expense
SellingAndMarketingExpense
292996000 USD
us-gaap Selling And Marketing Expense
SellingAndMarketingExpense
972490000 USD
CY2017Q3 us-gaap Selling And Marketing Expense
SellingAndMarketingExpense
352879000 USD
us-gaap Selling And Marketing Expense
SellingAndMarketingExpense
1023394000 USD
us-gaap Stock Issued During Period Value Share Based Compensation
StockIssuedDuringPeriodValueShareBasedCompensation
11885000 USD
CY2016Q4 us-gaap Stockholders Equity
StockholdersEquity
1869222000 USD
CY2017Q3 us-gaap Stockholders Equity
StockholdersEquity
2428921000 USD
CY2016Q4 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
StockholdersEquityIncludingPortionAttributableToNoncontrollingInterest
2010670000 USD
CY2017Q3 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
StockholdersEquityIncludingPortionAttributableToNoncontrollingInterest
2908703000 USD
us-gaap Stockholders Equity Other
StockholdersEquityOther
-870000 USD
CY2016Q4 us-gaap Treasury Stock Shares
TreasuryStockShares
193445000 shares
CY2017Q3 us-gaap Treasury Stock Shares
TreasuryStockShares
194163000 shares
CY2016Q4 us-gaap Treasury Stock Value
TreasuryStockValue
10176600000 USD
CY2017Q3 us-gaap Treasury Stock Value
TreasuryStockValue
10226721000 USD
us-gaap Treasury Stock Value Acquired Cost Method
TreasuryStockValueAcquiredCostMethod
50121000 USD
CY2016Q4 us-gaap Unrecognized Tax Benefits Income Tax Penalties Accrued
UnrecognizedTaxBenefitsIncomeTaxPenaltiesAccrued
1700000 USD
CY2017Q3 us-gaap Unrecognized Tax Benefits Income Tax Penalties Accrued
UnrecognizedTaxBenefitsIncomeTaxPenaltiesAccrued
1700000 USD
CY2016Q4 us-gaap Unrecognized Tax Benefits Interest On Income Taxes Accrued
UnrecognizedTaxBenefitsInterestOnIncomeTaxesAccrued
2600000 USD
CY2017Q3 us-gaap Unrecognized Tax Benefits Interest On Income Taxes Accrued
UnrecognizedTaxBenefitsInterestOnIncomeTaxesAccrued
3300000 USD
CY2017Q3 us-gaap Unrecognized Tax Benefits That Would Impact Effective Tax Rate
UnrecognizedTaxBenefitsThatWouldImpactEffectiveTaxRate
22000000 USD
CY2016Q3 us-gaap Weighted Average Number Diluted Shares Outstanding Adjustment
WeightedAverageNumberDilutedSharesOutstandingAdjustment
2087000 shares
us-gaap Weighted Average Number Diluted Shares Outstanding Adjustment
WeightedAverageNumberDilutedSharesOutstandingAdjustment
0 shares
CY2017Q3 us-gaap Weighted Average Number Diluted Shares Outstanding Adjustment
WeightedAverageNumberDilutedSharesOutstandingAdjustment
6379000 shares
us-gaap Weighted Average Number Diluted Shares Outstanding Adjustment
WeightedAverageNumberDilutedSharesOutstandingAdjustment
5133000 shares
CY2016Q3 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
81619000 shares
us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
80357000 shares
CY2017Q3 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
87196000 shares
us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
84502000 shares
CY2016Q3 us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
79532000 shares
us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
80357000 shares
CY2017Q3 us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
80817000 shares
us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
79369000 shares
us-gaap Concentration Risk Credit Risk
ConcentrationRiskCreditRisk
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-bottom:16px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Certain Risks and Concentrations</font></div><div style="line-height:120%;padding-bottom:16px;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">A meaningful portion of the Company's revenue is derived from online advertising, the market for which is highly competitive and rapidly changing. Significant changes in this industry or changes in advertising spending behavior or in customer buying behavior could adversely affect our operating results. Most of the Company's online advertising revenue is attributable to a services agreement with Google&#160;Inc. ("Google"). For the </font><font style="font-family:inherit;font-size:10pt;">three and nine months ended</font><font style="font-family:inherit;font-size:10pt;"> </font><font style="font-family:inherit;font-size:10pt;">September&#160;30, 2017</font><font style="font-family:inherit;font-size:10pt;">, revenue from Google represents </font><font style="font-family:inherit;font-size:10pt;">21%</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">23%</font><font style="font-family:inherit;font-size:10pt;">, respectively, of the Company's consolidated revenue. For the </font><font style="font-family:inherit;font-size:10pt;">three and nine months ended</font><font style="font-family:inherit;font-size:10pt;"> </font><font style="font-family:inherit;font-size:10pt;">September&#160;30, 2016</font><font style="font-family:inherit;font-size:10pt;">, revenue from Google represents </font><font style="font-family:inherit;font-size:10pt;">23%</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">27%</font><font style="font-family:inherit;font-size:10pt;">, respectively, of the Company's consolidated revenue.</font></div><div style="line-height:120%;padding-bottom:16px;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The services agreement became effective on April&#160;1, 2016, following the expiration of the previous services agreement, and expires on March 31, 2020; however, the Company may choose to terminate the agreement effective March 31, 2019. The services agreement requires that the Company comply with certain guidelines promulgated by Google. Google may generally unilaterally update its policies and guidelines without advance notice, which could in turn require modifications to, or prohibit and/or render obsolete certain of our products, services and/or business practices, which could be costly to address or otherwise have an adverse effect on our business, financial condition and results of operations.</font></div></div>
us-gaap Loss Contingency Disclosures
LossContingencyDisclosures
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-bottom:16px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">CONTINGENCIES</font></div><div style="line-height:120%;padding-bottom:16px;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In the ordinary course of business, the Company is a party to various lawsuits. The Company establishes reserves for specific legal matters when it determines that the likelihood of an unfavorable outcome is probable and the loss is reasonably estimable. Management has also identified certain other legal matters where we believe an unfavorable outcome is not probable and, therefore, no reserve is established. Although management currently believes that resolving claims against us, including claims where an unfavorable outcome is reasonably possible, will not have a material impact on the liquidity, results of operations, or financial condition of the Company, these matters are subject to inherent uncertainties and management's view of these matters may change in the future. The Company also evaluates other contingent matters, including income and non-income tax contingencies, to assess the likelihood of an unfavorable outcome and estimated extent of potential loss. It is possible that an unfavorable outcome of </font><font style="font-family:inherit;font-size:10pt;color:#000000;text-decoration:none;">one</font><font style="font-family:inherit;font-size:10pt;"> or more of these lawsuits or other contingencies could have a material impact on the liquidity, results of operations, or financial condition of the Company. See "</font><a style="font-family:inherit;font-size:10pt;" href="#sC8AFC1F21D4B050CE878C81539CCFA5B"><font style="font-family:inherit;font-size:10pt;">Note 2&#8212;Income Taxes</font></a><font style="font-family:inherit;font-size:10pt;">" for additional information related to income tax contingencies.</font></div></div>
us-gaap Prior Period Reclassification Adjustment Description
PriorPeriodReclassificationAdjustmentDescription
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-bottom:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Reclassifications</font></div><div style="line-height:120%;padding-bottom:16px;text-align:left;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Certain prior year amounts have been reclassified to conform to the current year presentation.</font></div></div>
us-gaap Use Of Estimates
UseOfEstimates
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-bottom:16px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Accounting Estimates</font></div><div style="line-height:120%;padding-bottom:16px;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Management of the Company is required to make certain estimates, judgments and assumptions during the preparation of its consolidated financial statements in accordance with GAAP. These estimates, judgments and assumptions impact the reported amounts of assets, liabilities, revenue and expenses and the related disclosure of contingent assets and liabilities. On an ongoing basis, the Company evaluates its estimates and judgments including those related to: the recoverability of goodwill and indefinite-lived intangible assets; the useful lives and recoverability of definite-lived intangible assets and property and equipment; the fair value of long-term investments; the carrying value of accounts receivable, including the determination of the allowance for doubtful accounts; the determination of revenue reserves; the fair value of acquisition-related contingent consideration arrangements; the liabilities for uncertain tax positions; the valuation allowance for deferred income tax assets; and the fair value of and forfeiture rates for stock-based awards, among others. The Company bases its estimates and judgments on historical experience, its forecasts and budgets and other factors that the Company considers relevant. Actual results could differ from these estimates.</font></div><div style="line-height:120%;padding-bottom:16px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;"></font></div></div>

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