What changed in this filing

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Item 2. Management’s Discussion and Analysis

2022-11-09 compared with 2022-08-09 · 91 added, 70 removed, 249 unchanged (39% of the section changed)

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In addition to historical financial information, the following discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions.

Our actual results and timing of selected events in future periods may differ materially from those anticipated or implied in these forward-looking statements as a result of many factors, including those discussed under Item 1A , "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2021 (the "2021 10-K"), under Item 1A , "Risk Factors" in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2022 (the "Q1 2022 10-Q"), under Item 1A , "Risk Factors" in this 10-Q and elsewhere in this 10-Q.

See also " Cautionary Note Regarding Forward-Looking Statements " at the beginning of this 10-Q.

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Curry continues to serve as our principal accounting officer.

On August 22, 2022, our Board of Directors appointed Greg Dale as Chief Operating Officer and David Algranati as Chief Innovation Officer of the Company, effective August 23, 2022.

The Company also announced that its Chief Commercial Officer, Chris Wilson, would be leaving the Company effective October 1 2022.

Results of Operations

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Percentages may not add due to rounding.

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

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General and administrative 12,899 13.9 % 16,895 18.3 % 48,119 17.3 % 45,609 16.9 %

Restructuring 5,784 6.2 % — — % 5,784 2.1 % — — %

Amortization of intangible assets 6,772 7.3 % 6,172 6.7 % 20,323 7.3 % 18,866 7.0 %

Impairment of goodwill 46,300 49.9 % — — % 46,300 16.6 % — — %

Total expenses from operations 149,225 160.8 % 96,509 104.3 % 356,481 128.1 % 296,847 109.7 %

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Other income (expense), net 1,477 1.6 % 5,713 6.2 % 8,467 3.0 % (9,069) (3.4) %

Gain (loss) from foreign currency transactions 2,527 2.8 % (370) (0.4) % 2,947 1.6 % 704 0.4 %

Gain from foreign currency transactions 2,781 3.0 % 1,180 1.3 % 5,728 2.1 % 1,884 0.7 %

Interest expense, net (284) (0.3) % (169) (0.2) % (660) (0.2) % (7,569) (2.8) %

Loss on extinguishment of debt — — % — — % — — % (9,629) (3.6) %

Loss before income taxes (4,402) (4.8) % (18,123) (20.7) % (12,295) (6.6) % (53,456) (30.0) %

Income tax provision (648) (0.7) % (422) (0.5) % (2,031) (1.1) % (1,444) (0.8) %

Net loss $ (5,050) (5.5) % $ (18,545) (21.2) % $ (14,326) (7.7) % $ (54,900) (30.8) %

(Loss) income before income taxes (52,468) (56.5) % 2,702 2.9 % (64,763) (23.3) % (50,754) (18.8) %

Income tax benefit (provision) 86 0.1 % (722) (0.8) % (1,945) (0.7) % (2,166) (0.8) %

Net (loss) income $ (52,382) (56.5) % $ 1,980 2.1 % $ (66,708) (24.0) % $ (52,920) (19.6) %

Our products and services are organized around solution groups that address customer needs.

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These costs include, but are not limited to, employee costs, purchased data, operational overhead, data storage and technology that supports multiple solution groups.

Revenues for the three months ended June 30, 2022 and 2021 were as follows:

Three Months Ended June 30,

Revenues for the three months ended September 30, 2022 and 2021 were as follows:

Three Months Ended September 30,

(In thousands) 2022 % of Revenue 2021 % of Revenue $ Variance % Variance

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Total revenues $ 92,783 100.0 % $ 92,487 100.0 % $ 296 0.3 %

Digital Ad Solutions revenue decreased primarily due to lower usage of our Activation product, partially offset by higher deliveries of our custom digital solutions.

Digital Ad Solutions revenue decreased primarily due to lower usage of our Activation product and lower deliveries of our custom digital solutions.

We believe that macroeconomic factors (such as inflation, rising interest rates and supply chain disruptions) have caused some advertisers to reduce or delay advertising expenditures in recent months, impacting demand for certain digital products.

Cross Platform Solutions revenue increased primarily due to higher TV revenues from new partnerships, higher contract values from renewals and increased agency adoption.

Our movies revenue increased due to the continued return of consumers to theaters in markets worldwide.

Revenues for the six months ended June 30, 2022 and 2021 were as follows:

Six Months Ended June 30,

Revenues for the nine months ended September 30, 2022 and 2021 were as follows:

Nine Months Ended September 30,

(In thousands) 2022 % of Revenue 2021 % of Revenue $ Variance % Variance

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Digital Ad Solutions revenue decreased primarily due to lower revenue from delivery of our digital measurement products in Europe due to $2.4 million in license revenue recognized under a multi-year contract in the first quarter of 2021.

This decrease was partially offset by higher revenue from deliveries of our custom digital solutions.

Digital Ad Solutions revenue was also impacted by lower usage of our Activation product.

As noted above, we believe that macroeconomic factors have caused a reduction or delay in advertising expenditures in recent months, impacting demand for certain digital products.

Cross Platform Solutions revenue increased primarily due to higher TV revenues from new partnerships, higher contract values from renewals and increased agency adoption.

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Additionally, cost of revenues includes allocated overhead, which is comprised of lease expense and other facilities-related costs, and depreciation expense generated by general purpose equipment and software.

Cost of revenues for the three months ended June 30, 2022 and 2021 were as follows:

Three Months Ended June 30,

Cost of revenues for the three months ended September 30, 2022 and 2021 were as follows:

Three Months Ended September 30,

(In thousands) 2022 % of Revenue 2021 % of Revenue

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Total cost of revenues $ 51,530 55.5 % $ 49,179 53.2 % $ 2,351 4.8 %

Cost of revenues for the six months ended June 30, 2022 and 2021 were as follows:

Six Months Ended June 30,

Systems and bandwidth costs increased primarily due to increased cloud computing costs in 2022 due to recognition of non-recurring credits during 2021.

Cost of revenues for the nine months ended September 30, 2022 and 2021 were as follows:

Nine Months Ended September 30,

(In thousands) 2022 % of Revenue 2021 % of Revenue

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Total cost of revenues $ 155,915 56.0 % $ 153,267 56.7 % $ 2,648 1.7 %

Systems and bandwidth costs increased primarily due to cloud computing and processing costs attributable to certain custom TV data set deliveries in the first half of 2022, including $3.0 million that was recognized as revenue as described above.

Systems and bandwidth costs increased primarily due to cloud computing and processing costs attributable to certain custom TV data set deliveries, including $3.8 million that was recognized as revenue as described above.

Lease expense and depreciation increased primarily due to higher depreciation of capitalized internal-use software costs.

Other expenses decreased primarily due to the recognition of $2.4 million in license costs associated with the delivery of our digital measurement products in Europe in the first quarter of 2021 in connection with the multi-year contract described above.

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Selling and marketing expenses consist primarily of employee costs for salaries, benefits, commissions, stock-based compensation and other related costs for personnel associated with sales and marketing activities.

It also includes costs related to online and offline advertising, industry conferences, promotional materials, public relations, other sales and marketing programs and allocated overhead, which is comprised of lease expense and other facilities-related costs, and depreciation expense generated by general purpose equipment and software.

Selling and marketing expenses for the three months ended June 30, 2022 and 2021 were as follows:

Three Months Ended June 30,

They also include costs related to online and offline advertising, industry conferences, promotional materials, public relations, other sales and marketing programs and allocated overhead, which is comprised of lease expense and other facilities-related costs, and depreciation expense generated by general purpose equipment and software.

Selling and marketing expenses for the three months ended September 30, 2022 and 2021 were as follows:

Three Months Ended September 30,

(In thousands) 2022 % of Revenue 2021 % of Revenue $ Change % Change

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Total selling and marketing expenses $ 17,199 18.5 % $ 15,212 16.4 % $ 1,987 13.1 %

Selling and marketing expenses for the six months ended June 30, 2022 and 2021 were as follows:

Six Months Ended June 30,

Employee costs increased primarily due to increased commissions during the three months ended September 30, 2022.

Selling and marketing expenses for the nine months ended September 30, 2022 and 2021 were as follows:

Nine Months Ended September 30,

(In thousands) 2022 % of Revenue 2021 % of Revenue $ Change % Change

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Total selling and marketing expenses $ 51,850 18.6 % $ 49,569 18.3 % $ 2,281 4.6 %

Other expense increased primarily due to increased participation in marketing events during 2022.

Research and Development

Research and development expenses include product development costs, consisting primarily of employee costs for salaries, benefits, stock-based compensation and other related costs for personnel associated with research and development activities, third-party expenses to develop new products and third-party data costs and allocated overhead, which is comprised of lease expense and other facilities-related costs, and depreciation expense related to general purpose equipment and software.

Research and development expenses for the three months ended June 30, 2022 and 2021 were as follows:

Three Months Ended June 30,

Research and development expenses for the three months ended September 30, 2022 and 2021 were as follows:

Three Months Ended September 30,

(In thousands) 2022 % of Revenue 2021 % of Revenue $ Change % Change

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Total research and development expenses $ 8,741 9.4 % $ 9,051 9.8 % $ (310) (3.4) %

Research and development expenses for the six months ended June 30, 2022 and 2021 were as follows:

Six Months Ended June 30,

Research and development expenses for the nine months ended September 30, 2022 and 2021 were as follows:

Nine Months Ended September 30,

(In thousands) 2022 % of Revenue 2021 % of Revenue $ Change % Change

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General and administrative expenses consist primarily of employee costs for salaries, benefits, stock-based compensation and other related costs, and related expenses for executive management, finance, human capital, legal and other administrative functions, as well as professional fees, overhead, including allocated overhead, which is comprised of lease expense and other facilities-related costs, depreciation expense related to general purpose equipment and software, amortization of cloud-computing implementation costs, changes in the fair value of our contingent consideration liability, Board of Directors compensation and expenses incurred for other general corporate purposes.

General and administrative expenses for the three months ended June 30, 2022 and 2021 were as follows:

Three Months Ended June 30,

General and administrative expenses for the three months ended September 30, 2022 and 2021 were as follows:

Three Months Ended September 30,

(In thousands) 2022 % of Revenue 2021 % of Revenue $ Change % Change

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Total general and administrative expenses $ 12,899 13.9 % $ 16,895 18.3 % $ (3,996) (23.7) %

Employee costs increased primarily due to severance expense related to the retirement of our former Chief Executive Officer ("CEO").

General and administrative expenses for the six months ended June 30, 2022 and 2021 were as follows:

Six Months Ended June 30,

Employee costs decreased primarily due to severance expense related to the departure of our former Chief Financial Officer in August 2021.

Professional fees decreased primarily due to increased consulting and auditing fees during 2021 related to implementation support for our new enterprise resource planning system and the reclassification of consulting fees incurred in the three months ended June 30, 2022 to restructuring expense during the three months ended September 30, 2022.

General and administrative expenses for the nine months ended September 30, 2022 and 2021 were as follows:

Nine Months Ended September 30,

(In thousands) 2022 % of Revenue 2021 % of Revenue $ Change % Change

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Total general and administrative expenses $ 48,119 17.3 % $ 45,609 16.9 % $ 2,510 5.5 %

Employee costs increased primarily due to severance expense related to the retirement of our former CEO.

Professional fees increased primarily due to a reclassification of insurance costs from other expenses to better reflect the nature of services provided.

Other expense increased primarily due to a $2.4 million loss resulting from the change in fair value of the contingent consideration recognized as part of the business combination described in Footnote 2 , Summary of Significant Accounting Policies .

This increase was partially offset by the reclassification of insurance costs to professional fees.

Organizational Restructuring

In September 2022, we implemented a restructuring plan that included a workforce reduction.

Certain other initiatives are expected to be completed as part of the restructuring plan, as described in Footnote 10 , Organizational Restructuring .

We incurred $5.8 million of restructuring expenses during the three and nine months ended September 30, 2022 related to the plan and expect these costs to continue into 2023 as other initiatives are completed.

No restructuring expenses were incurred during the corresponding periods in 2021.

Impairment of Goodwill

As of September 30, 2022, as a result of a decline in our stock price and market capitalization, among other factors, we performed an interim impairment review of our goodwill in conjunction with our October 1, 2022 annual testing date.

Our reporting unit did not pass the goodwill impairment test, and as a result we recorded a $46.3 million non-cash impairment charge in the three months ended September 30, 2022.

For further information on our goodwill, refer to Footnote 4 , Goodwill and Item 2 , " Critical Accounting Estimates" within our 2021 10-K .

Other Income (Expense), Net

Other income (expense), net represents income and expenses incurred that are generally not recurring in nature or are not part of our regular operations.

The following is a summary of other income (expense), net for the three and six months ended June 30, 2022 and 2021:

Three Months Ended June 30, Six Months Ended June 30,

The following is a summary of other income (expense), net for the three and nine months ended September 30, 2022 and 2021:

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands) 2022 2021 2022 2021

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$ 1,477 $ 5,713 $ 8,467 $ (9,069)

The change in other income (expense), net for the three and six months ended June 30, 2022 as compared to 2021 was largely driven by changes in the fair value of our warrants liability.

The gain on the warrants liability for the three and six months ended June 30, 2022 was primarily due to a decrease in the trading price of our Common Stock during the relevant periods.

The loss on the warrants liability for the three and six months ended June 30, 2021 was due primarily to the exercise price adjustment described in Footnote 4 , Convertible Redeemable Preferred Stock and Stockholders' Equity , and an increase in the trading price of our Common Stock during the relevant periods.

The change in other income (expense), net for the three and nine months ended September 30, 2022 as compared to 2021 was largely driven by changes in the fair value of our warrants liability.

The gain on the warrants liability for the three and nine months ended September 30, 2022 was primarily due to a decrease in the trading price of our Common Stock during the relevant periods.

The gain on the warrants liability during the three months ended September 30, 2021 was primarily due to a decrease in the trading price of our Common Stock during the period.

The loss on the warrants liability for the nine months ended September 30, 2021 was due primarily to the exercise price adjustment described in Footnote 5 , Convertible Redeemable Preferred Stock and Stockholders' Equity , and an increase in the trading price of our Common Stock during the relevant period.

Interest Expense, Net

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Interest expense relates to interest on our senior secured convertible notes (the "Notes"), foreign secured promissory note (the "Secured Term Note"), our senior secured revolving credit agreement (the "Revolving Credit Agreement"), our sale-leaseback agreement, and our finance leases.

We incurred interest expense, net of $0.2 million and $0.4 million during the three months ended June 30, 2022 and 2021, respectively, and $0.4 million and $7.4 million during the six months ended June 30, 2022 and 2021, respectively.

The decrease in interest expense for the six months ended June 30, 2022 as compared to 2021 was primarily due to the extinguishment of the Notes and the Secured Term Note in March 2021, as described in Footnote 5 , Debt.

Gain (Loss) From Foreign Currency Transactions

We incurred interest expense, net of $0.3 million and $0.2 million during the three months ended September 30, 2022 and 2021, respectively, and $0.7 million and $7.6 million during the nine months ended September 30, 2022 and 2021, respectively.

The decrease in interest expense for the nine months ended September 30, 2022 as compared to 2021 was primarily due to the extinguishment of the Notes and the Secured Term Note in March 2021, as described in Footnote 6 , Debt.

Gain From Foreign Currency Transactions

Our foreign currency transactions are recorded as a result of fluctuations in the exchange rate between the transactional currency and the functional currency of foreign subsidiary transactions.

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Dollars are in a net asset position.

For the three months ended June 30, 2022 and 2021, the gain (loss) from foreign currency transactions was $2.5 million and $(0.4) million, respectively.

For the six months ended June 30, 2022 and 2021, the gain from foreign currency transactions was $2.9 million and $0.7 million, respectively.

The gain during the three and six months ended June 30, 2022 was primarily driven by fluctuations between the Chilean Peso, Euro and U.S.

For the three months ended September 30, 2022 and 2021, the gain from foreign currency transactions was $2.8 million and $1.2 million, respectively.

For the nine months ended September 30, 2022 and 2021, the gain from foreign currency transactions was $5.7 million and $1.9 million, respectively.

The gain during the three and nine months ended September 30, 2022 was primarily driven by fluctuations between the Chilean Peso, Euro and U.S.

Dollar exchange rates.

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In March 2021, we recorded a $9.6 million loss on debt extinguishment related to the payoff of the Notes and the Secured Term Note.

The primary drivers of the extinguishment loss were the write-off of unamortized deferred financing costs and issuance discounts, the issuance of

additional shares of Common Stock in connection with the extinguishment, and the derecognition of the interest rate reset derivative liability on the Notes.

The primary drivers of the extinguishment loss were the write-off of unamortized deferred financing costs and issuance discounts, the issuance of additional shares of Common Stock in connection with the extinguishment, and the derecognition of the interest rate reset derivative liability on the Notes.

These components are described in Footnote 6 , Debt .

Income Tax Provision

Income Tax Benefit (Provision)

A valuation allowance has been established against our net U.S.

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deferred taxes for tax deductible goodwill and other indefinite-lived liabilities.

For the three months ended June 30, 2022 and 2021, we recorded income tax provisions of $0.6 million and $0.4 million, respectively, resulting in effective tax rates of 14.7% and 2.3%, respectively.

For the six months ended June 30, 2022 and 2021, we recorded income tax provisions of $2.0 million and $1.4 million, respectively, resulting in effective tax rates of 16.5% and 2.7%, respectively.

For the three months ended September 30, 2022 and 2021, we recorded income tax benefit of $0.1 million and an income tax provision of $0.7 million, respectively, resulting in effective tax rates of 0.2% and 26.7%, respectively.

For the nine months ended September 30, 2022 and 2021, we recorded income tax provisions of $1.9 million and $2.2 million, respectively, resulting in effective tax rates of 3.0% and 4.3%, respectively.

These effective tax rates differ from the U.S.

federal statutory rate primarily due to the effects of certain permanent items, foreign tax rate differences, and increases in the valuation allowance against our domestic deferred tax assets.

The increase in the income tax provision during 2022 as compared to 2021 was primarily due to an increase in estimated foreign tax expense in 2022.

federal statutory rate primarily due to the effects of certain permanent items, foreign tax rate differences, discrete items, and increases in the valuation allowance against our domestic deferred tax assets.

A deferred income tax benefit of $1.4 million related to the impairment of goodwill is included in the amounts recorded in the three and nine months ended September 30, 2022.

The decrease in income tax provision during 2022 as compared to 2021 was primarily due to the income tax benefit related to the impairment of goodwill, offset by an increase in estimated foreign tax expense in 2022.

Liquidity and Capital Resources

The following table summarizes our cash flows for each of the periods identified:

Six Months Ended June 30,

Nine Months Ended September 30,

(In thousands) 2022 2021

Net cash provided by operating activities $ 24,233 $ 10,860

Net cash provided by (used in) operating activities $ 36,536 $ (1,121)

Net cash used in investing activities (13,225) (11,669)

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Effect of exchange rate changes on cash, cash equivalents and restricted cash (2,502) (691)

Net decrease in cash, cash equivalents and restricted cash (2,220) (33,061)

Net increase (decrease) in cash, cash equivalents and restricted cash 3,232 (34,007)

Our principal uses of cash consist of cash paid for data, payroll and other operating expenses, including expenses incurred in prior periods;

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and dividend payment obligations with respect to our Series B Convertible Preferred Stock ("Preferred Stock").

As of June 30, 2022, our principal sources of liquidity consisted of cash, cash equivalents and restricted cash totaling $20.1 million (including $0.4 million in restricted cash), cash flows from our operations, and $20.7 million available to us under our Revolving Credit Agreement, as described below.

As of September 30, 2022, our principal sources of liquidity consisted of cash, cash equivalents and restricted cash totaling $25.5 million (including $0.4 million in restricted cash), cash flows from our operations, and $20.6 million available to us under our Revolving Credit Agreement, as described below.

On March 10, 2021, we entered into separate Securities Purchase Agreements with each of Charter Communications Holding Company, LLC ("Charter"), Qurate Retail, Inc.

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The Revolving Credit Agreement provides a borrowing capacity equal to $40.0 million.

During 2021, we borrowed $16.0 million under the Revolving Credit Agreement.

In addition to these borrowings, we have issued and outstanding letters of credit totaling $3.3 million under the Revolving Credit Agreement, leaving a remaining borrowing capacity of $20.7 million as of June 30, 2022.

During 2021, we borrowed $16.0 million under the Revolving Credit

In addition to these borrowings, we have issued and outstanding letters of credit totaling $3.4 million under the Revolving Credit Agreement, leaving a remaining borrowing capacity of $20.6 million as of September 30, 2022.

On June 30, 2022, we made cash dividend payments totaling $15.5 million to the holders of the Preferred Stock, representing dividends accrued for the period from June 30, 2021 through June 29, 2022.

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Shares of Preferred Stock are convertible into Common Stock as described in Footnote 5 , Convertible Redeemable Preferred Stock and Stockholders' Equity .

As of June 30, 2022, each share of Preferred Stock would have been convertible into 1.000208 shares of Common Stock, with such assumed conversion rate scheduled to return to 1.00 upon payment of accrued dividends on June 30, 2023.

As of September 30, 2022, each share of Preferred Stock would have been convertible into 1.019375 shares of Common Stock, with such assumed conversion rate scheduled to return to 1.00 upon payment of accrued dividends on June 30, 2023.

The holders of Preferred Stock are entitled to participate in all dividends declared on the Common Stock on an as-converted basis and are also entitled to a cumulative dividend at the rate of 7.5% per annum, payable annually in arrears and subject to increase under certain specified circumstances.

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Notably, the Revolving Credit Agreement contains financial covenants that require us to maintain minimum Consolidated EBITDA for periods through December 31, 2022, a minimum Consolidated Asset Coverage Ratio for periods ending March 31, 2022 through December 31, 2022, and a minimum Consolidated Fixed Charge Coverage Ratio for periods after December 31, 2022 (each term as defined in the Revolving Credit Agreement).

As of June 30, 2022, we were in compliance with our covenants under the Revolving Credit Agreement, and based on our current plans, we do not anticipate a breach of these covenants that would result in an event of default under the Revolving Credit Agreement.

As of June 30, 2022, we had outstanding borrowings of $16.0 million and outstanding letters of credit totaling $3.3 million under the Revolving Credit Agreement, leaving a remaining borrowing capacity of $20.7 million.

As of September 30, 2022, we were in compliance with our covenants under the Revolving Credit Agreement, and based on our current plans, we do not anticipate a breach of these covenants that would result in an event of default under the Revolving Credit Agreement.

As of September 30, 2022, we had outstanding borrowings of $16.0 million and outstanding letters of credit totaling $3.4 million under the Revolving Credit Agreement, leaving a remaining borrowing capacity of $20.6 million.

The borrowed funds were used to reduce our accounts payable balances, primarily related to expenses incurred in prior periods, and support our working capital position.

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Cash provided by operating activities is calculated by adjusting our net loss for changes in working capital, as well as by excluding non-cash items such as:

depreciation, non-cash operating lease expense, amortization expense of finance leases and intangible assets, stock-based compensation, deferred tax provision, change in the fair value of contingent consideration, financing derivatives and warrants liability, loss on extinguishment of debt, non-cash interest expense on the Notes, accretion of debt discount, and amortization of deferred financing costs.

Net cash provided by operating activities for the six months ended June 30, 2022 was $24.2 million, compared to $10.9 million for the six months ended June 30, 2021.

The increase in cash provided by operating activities was primarily attributable to a net increase in cash generated from operating assets and liabilities of $9.2 million for the six months ended June 30, 2022 as compared to $1.3 million for the six months ended June 30, 2021.

depreciation, non-cash operating lease expense, amortization expense of finance leases and intangible assets, goodwill impairment, stock-based compensation, deferred tax provision, change in the fair value of contingent consideration, financing derivatives and warrants liability, loss on extinguishment of debt, non-cash interest expense on the Notes, accretion of debt discount, and amortization of deferred financing costs.

Net cash provided by operating activities for the nine months ended September 30, 2022 was $36.5 million, compared to net cash used in operating activities of $1.1 million for the nine months ended September 30, 2021.

The increase in cash provided by operating activities was primarily attributable to a net increase in cash generated from operating assets and liabilities of $15.1 million for the nine months ended September 30, 2022 as compared to $22.1 million for the nine months ended September 30, 2021.

The higher amount of cash generated from operating assets and liabilities in 2022 is primarily reflective of higher revenues, shorter billing cycles, and improved cash collections during 2022 as compared to 2021.

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The extent of these investments will be affected by our ability to expand relationships with existing customers, grow our customer base and introduce new digital formats, as well as constraints on cash expenditures due to our financial position and the current economic environment.

Net cash used in investing activities for the six months ended June 30, 2022 was $8.3 million compared to $7.7 million for the six months ended June 30, 2021.

Net cash used in investing activities for the nine months ended September 30, 2022 was $13.2 million compared to $11.7 million for the nine months ended September 30, 2021.

The increase in cash used in investing activities was primarily due to an increase in cash paid for capitalized internally developed software.

Financing Activities

Net cash used in financing activities during the six months ended June 30, 2022 was $17.0 million compared to $35.9 million during the six months ended June 30, 2021.

The significant decrease in cash used for financing activities was due to repayment of our Notes and the Secured Term Note, which outflows were partially offset by cash proceeds received from the issuance of the Preferred Stock (net of related transaction costs), during 2021.

Net cash used in financing activities during the nine months ended September 30, 2022 was $17.6 million compared to $20.5 million during the nine months ended September 30, 2021.

The decrease in cash used for financing activities was due to repayment of our Notes and the Secured Term Note, which outflows were partially offset by cash proceeds received from the issuance of the Preferred Stock (net of related transaction costs), during 2021.

These decreases were partially offset by a net increase of $10.8 million in cash dividends paid to holders of the Preferred Stock in 2022, reflecting a full annual dividend period, as compared to 2021, which included only a partial dividend period.

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These agreements have remaining terms from one to nine years.

As of June 30, 2022, the total fixed payment obligations related to set-top box and connected (Smart) television data agreements are $310.2 million and $11.2 million, respectively.

As of September 30, 2022, the total fixed payment obligations related to set-top box and connected (Smart) television data agreements are $301.9 million and $9.8 million, respectively.

In addition, we expect to make variable payments related to a set-top box data agreement totaling an estimated $11.6 million over the next two years.

Balances as of September 30, 2022 do not reflect the impact of the November 6, 2022 amendment to our Charter data licensing agreement, which includes fee credits totaling $7.0 million for 2022 and 2023.

For additional information about the Charter amendment, refer to Footnote 12 , Subsequent Events .

We have both operating and financing leases related to corporate office space and equipment.

Our leases have remaining terms from one to six years.

As of June 30, 2022, the total fixed payment obligation related to these agreements is $55.8 million.

As of September 30, 2022, the total fixed payment obligation related to these agreements is $53.2 million.

We have an agreement for cloud-based data storage and bandwidth to help process and store our data.

The remaining term for this agreement is two years.

As of June 30, 2022, the total fixed payment obligation related to this agreement is $14.7 million.

As of September 30, 2022, the total fixed payment obligation related to this agreement is $12.2 million.

Future Capital Requirements

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis