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Item 1. Financial Statements

2024-05-10 compared with 2023-11-08 · 188 added, 247 removed, 380 unchanged (53% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

September 30, 2023 December 31, 2022

(In thousands, except share and par value data) (Unaudited)

March 31, 2024 December 31, 2023

(In thousands, except share and per share data) (Unaudited)

Current assets:

23 unchanged sentences

Customer advances 8,798 11,076

Current portion of contingent consideration 3,676 7,134

Current operating lease liabilities 8,424 7,982

Current portion of contingent consideration 1,202 4,806

Other current liabilities 3,044 4,680

3 unchanged sentences

34,156 32,833

Non-current revolving line of credit — 16,000

Deferred tax liabilities 1,232 1,321

3 unchanged sentences

Convertible redeemable preferred stock, $ 0.001 par value;

100,000,000 shares authorized and 82,527,609 shares issued and outstanding as of September 30, 2023 and 82,527,609 shares authorized, issued and outstanding as of December 31, 2022;

aggregate liquidation preference of $ 223,846 as of September 30, 2023, and $ 211,863 as of December 31, 2022 (related parties)

100,000,000 shares authorized and 82,527,609 shares issued and outstanding as of March 31, 2024 and December 31, 2023;

aggregate liquidation preference of $ 232,372 as of March 31, 2024, and $ 228,132 as of December 31, 2023 (related parties)

187,885 187,885

1 unchanged sentence

Preferred stock, $ 0.001 par value;

5,000,000 shares authorized as of September 30, 2023 and 7,472,391 shares authorized as of December 31, 2022;

no shares issued or outstanding as of September 30, 2023 or December 31, 2022

5,000,000 shares authorized as of March 31, 2024 and December 31, 2023;

no shares issued or outstanding as of March 31, 2024 or December 31, 2023

Common stock, $ 0.001 par value;

275,000,000 shares authorized as of September 30, 2023 and December 31, 2022;

101,851,130 shares issued and 95,086,334 shares outstanding as of September 30, 2023, and 98,869,738 shares issued and 92,104,942 shares outstanding as of December 31, 2022

13,750,000 shares authorized as of March 31, 2024 and December 31, 2023;

5,098,470 shares issued and 4,760,231 shares outstanding as of March 31, 2024, and 5,093,380 shares issued and 4,755,141 shares outstanding as of December 31, 2023

Additional paid-in capital 1,699,142 1,696,612

1 unchanged sentence

Accumulated deficit ( 1,401,714 ) ( 1,396,420 )

Treasury stock, at cost, 6,764,796 shares as of September 30, 2023 and December 31, 2022

Treasury stock, at cost, 338,239 shares as of March 31, 2024 and December 31, 2023

( 229,984 ) ( 229,984 )

3 unchanged sentences

COMSCORE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

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

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

Three Months Ended March 31,

(In thousands, except share and per share data) 2024 2023

5 unchanged sentences

Research and development (2) (3)

8,083 8,741 25,792 28,190

General and administrative (2) (3)

1 unchanged sentence

Amortization of intangible assets 801 2,811

Impairment of right-of-use and long-lived assets 1,502 — 1,502 —

Restructuring 460 998

Impairment of goodwill — 46,300 44,100 46,300

Total expenses from operations 88,672 95,385

Income (loss) from operations 2,067 ( 56,442 ) ( 49,139 ) ( 78,298 )

Other income, net 628 1,477 425 8,467

Loss from operations ( 1,877 ) ( 3,827 )

Other income (expense), net 275 ( 1,812 )

Gain (loss) from foreign currency transactions 963 ( 1,466 )

Interest expense, net ( 572 ) ( 352 )

Income (loss) before income taxes 3,359 ( 52,468 ) ( 50,399 ) ( 64,763 )

Income tax (provision) benefit ( 741 ) 86 ( 563 ) ( 1,945 )

Net income (loss) $ 2,618 $ ( 52,382 ) $ ( 50,962 ) $ ( 66,708 )

Loss before income taxes ( 1,211 ) ( 7,457 )

Income tax benefit (provision) 157 ( 1,214 )

Net loss $ ( 1,054 ) $ ( 8,671 )

Net loss available to common stockholders:

Net income (loss) $ 2,618 $ ( 52,382 ) $ ( 50,962 ) $ ( 66,708 )

Net loss $ ( 1,054 ) $ ( 8,671 )

Convertible redeemable preferred stock dividends (1)

5 unchanged sentences

Basic and diluted 4,895,121 4,692,513

Comprehensive income (loss):

Net income (loss) $ 2,618 $ ( 52,382 ) $ ( 50,962 ) $ ( 66,708 )

Other comprehensive loss:

Comprehensive loss:

Net loss $ ( 1,054 ) $ ( 8,671 )

Other comprehensive (loss) income:

Foreign currency cumulative translation adjustment ( 1,987 ) 1,517

Total comprehensive income (loss) $ 351 $ ( 56,935 ) $ ( 51,831 ) $ ( 76,346 )

Total comprehensive loss $ ( 3,041 ) $ ( 7,154 )

(1) Transactions with related parties are included in the line items above as follows (refer to Footnote 8 , Related Party Transactions , of the Notes to Condensed Consolidated Financial Statements for additional information):

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

2023 2022 2023 2022

Three Months Ended March 31,

Revenues $ 2,518 $ 3,009

3 unchanged sentences

(3) Stock-based compensation expense is included in the line items above as follows:

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

2023 2022 2023 2022

Three Months Ended March 31,

Cost of revenues $ 243 $ 78

3 unchanged sentences

Total stock-based compensation expense $ 1,378 $ 1,117

(4) Adjusted retroactively for the Reverse Stock Split, refer to Footnote 2 , Summary of Significant Accounting Policies .

See accompanying Notes to Condensed Consolidated Financial Statements.

18 unchanged sentences

Foreign currency translation adjustment — — — — — ( 1,987 ) — — ( 1,987 )

Other — — ( 39 ) — — — — — —

Balance as of March 31, 2024 82,527,609 $ 187,885 4,760,231 $ 5 $ 1,699,142 $ ( 16,097 ) $ ( 1,401,714 ) $ ( 229,984 ) $ 51,352

Net loss — — — — — — ( 44,909 ) — ( 44,909 )

Convertible redeemable preferred stock dividends (1)

— — — — — — ( 3,872 ) — ( 3,872 )

Restricted stock units distributed — — 2,735,991 3 — — — — 3

Payments for taxes related to net share settlement of equity awards — — ( 9,185 ) — ( 12 ) — — — ( 12 )

Amortization of stock-based compensation — — — — 915 — — — 915

Foreign currency translation adjustment — — — — — ( 119 ) — — ( 119 )

Balance as of June 30, 2023 82,527,609 $ 187,885 95,086,334 $ 95 $ 1,695,281 $ ( 14,542 ) $ ( 1,362,066 ) $ ( 229,984 ) $ 88,784

Net income — — — — — — 2,618 — 2,618

Convertible redeemable preferred stock dividends (1)

— — — — — — ( 4,286 ) — ( 4,286 )

Amortization of stock-based compensation — — — — 717 — — — 717

Foreign currency translation adjustment — — — — — ( 2,267 ) — — ( 2,267 )

Balance as of September 30, 2023 82,527,609 $ 187,885 95,086,334 $ 95 $ 1,695,998 $ ( 16,809 ) $ ( 1,363,734 ) $ ( 229,984 ) $ 85,566

(In thousands, except share data) Convertible Redeemable Preferred Stock Common Stock Additional

Capital Accumulated

(In thousands, except share data) Convertible Redeemable Preferred Stock Common Stock (2)

Comprehensive

13 unchanged sentences

Foreign currency translation adjustment — — — — — 1,517 — — 1,517

Other — — ( 661 ) — ( 3 ) — — — ( 3 )

Balance as of March 31, 2023 82,527,609 $ 187,885 4,617,976 $ 5 $ 1,694,465 $ ( 14,423 ) $ ( 1,313,285 ) $ ( 229,984 ) $ 136,778

Net loss — — — — — — ( 5,050 ) — ( 5,050 )

Convertible redeemable preferred stock dividends (1)

— — — — — — ( 3,868 ) — ( 3,868 )

Restricted stock units distributed — — 958,594 1 — — — — 1

Exercise of Common Stock options — — 745 — — — — — —

Payments for taxes related to net share settlement of equity awards — — ( 12,646 ) — ( 23 ) — — — ( 23 )

Amortization of stock-based compensation — — — — 2,011 — — — 2,011

Foreign currency translation adjustment — — — — — ( 4,544 ) — — ( 4,544 )

Other — — 121,357 — — — — — —

Balance as of June 30, 2022 82,527,609 $ 187,885 91,773,392 $ 92 $ 1,689,596 $ ( 17,183 ) $ ( 1,240,734 ) $ ( 229,984 ) $ 201,787

Net loss — — — — — — ( 52,382 ) — ( 52,382 )

Convertible redeemable preferred stock dividends (1)

— — — — — — ( 3,910 ) — ( 3,910 )

Restricted stock units distributed — — 226,948 — — — — — —

Exercise of common stock options — — 9,269 — — — — — —

Amortization of stock-based compensation — — — — 1,013 — — — 1,013

Foreign currency translation adjustment — — — — — ( 4,553 ) — — ( 4,553 )

Balance as of September 30, 2022 82,527,609 $ 187,885 92,009,609 $ 92 $ 1,690,609 $ ( 21,736 ) $ ( 1,297,026 ) $ ( 229,984 ) $ 141,955

(1) Transactions for these line items were exclusively with related parties (refer to Footnote 4 , Convertible Redeemable Preferred Stock and Stockholders' Equity and Footnote 8 , Related Party Transactions , of the Notes to Condensed Consolidated Financial Statements for additional information).

(2) Adjusted retroactively for the Reverse Stock Split, refer to Footnote 2 , Summary of Significant Accounting Policies .

See accompanying Notes to Condensed Consolidated Financial Statements.

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Nine Months Ended September 30,

Three Months Ended March 31,

(In thousands) 2024 2023

2 unchanged sentences

Adjustments to reconcile net loss to net cash provided by operating activities:

Impairment of goodwill 44,100 46,300

Depreciation 5,248 4,724

Amortization of intangible assets 4,412 20,323

Non-cash operating lease expense 4,196 4,540

Stock-based compensation expense 1,378 1,117

Impairment of right-of-use and long-lived assets 1,502 —

Non-cash operating lease expense 1,249 1,395

Amortization of intangible assets 801 2,811

Amortization expense of finance leases 644 429

1 unchanged sentence

Change in fair value of warrants liability ( 286 ) 1,815

Deferred tax benefit ( 61 ) ( 90 )

Deferred tax (benefit) provision ( 132 ) 566

Other 623 254

11 unchanged sentences

Financing activities :

Principal payments on finance leases ( 1,337 ) ( 2,004 )

Contingent consideration payment at initial value ( 3,693 ) ( 1,037 )

Payments for dividends on convertible redeemable preferred stock (1)

Principal payments on finance leases ( 658 ) ( 445 )

Other ( 56 ) ( 174 )

1 unchanged sentence

Effect of exchange rate changes on cash, cash equivalents and restricted cash ( 384 ) 467

Net increase in cash, cash equivalents and restricted cash 9,811 3,232

Net (decrease) increase in cash, cash equivalents and restricted cash ( 4,019 ) 230

Cash, cash equivalents and restricted cash at beginning of period 22,936 20,442

Cash, cash equivalents and restricted cash at end of period $ 18,917 $ 20,672

(1) Transactions for this line item were exclusively with related parties (refer to Footnote 9 , Related Party Transactions , of the Notes to Condensed Consolidated Financial Statements for additional information).

As of September 30,

As of March 31,

Cash and cash equivalents $ 18,730 $ 20,274

1 unchanged sentence

Total cash, cash equivalents and restricted cash $ 18,917 $ 20,672

Nine Months Ended September 30,

Three Months Ended March 31,

Supplemental disclosures of non-cash investing and financing activities :

Convertible redeemable preferred stock dividends accrued but not yet paid (related parties) $ 4,240 $ 3,825

Right-of-use assets obtained in exchange for finance lease liabilities 3,048 1,106

Settlement of restricted stock unit liability 1,895 2,761

14 unchanged sentences

All intercompany transactions and balances are eliminated upon consolidation.

Reclassification

Certain amounts in the prior year financial statements have been reclassified to conform to the current year presentation.

Specifically, accrued dividends have been separated from other current liabilities, and warrants liability has been aggregated within other current liabilities on the Condensed Consolidated Balance Sheets.

Reverse Stock Split

On December 12, 2023, the Company held a special meeting of stockholders of the Company (the "Special Meeting").

At the Special Meeting, the stockholders approved an amendment to the Company's Amended and Restated Certificate of Incorporation (the "Certificate of Amendment") for the purpose of effecting a reverse stock split (the "Reverse Stock Split") of all outstanding shares of Common Stock, par value $ 0.001 per share (the "Common Stock") and reducing the number of authorized shares of Common Stock by the same ratio as the Reverse Stock Split.

Following the Special Meeting, the Board of Directors approved a final ratio of 1-for-20 for the Reverse Stock Split with an effective date of December 20, 2023.

On December 20, 2023, the Company filed the Certificate of Amendment with the Secretary of State of the State of Delaware to implement the Reverse Stock Split, without any change to the par value of the Common Stock.

The Certificate of Amendment reduced the number of authorized shares of Common Stock from 275,000,000 to 13,750,000 and the total number of shares of stock authorized for issuance from 380,000,000 to 118,750,000 .

The Company implemented the Reverse Stock Split on December 20, 2023.

The Common Stock began trading on a split-adjusted basis on the Nasdaq Global Select Market on December 20, 2023 under the existing trading symbol "SCOR", but the security has been assigned a new CUSIP number (20564W204).

As a result of the Reverse Stock Split, every 20 shares of Common Stock issued and outstanding or held in treasury immediately prior to the Reverse Stock Split were converted into one share of Common Stock after the Reverse Stock Split.

The Reverse Stock Split applied uniformly to all holders of Common Stock and did not alter any stockholder's percentage interest in the Company, except to the extent that the Reverse Stock Split would have resulted in some stockholders owning a fractional share.

No fractional shares were issued in connection with the Reverse Stock Split, as all fractional shares were rounded down to the nearest whole share.

Stockholders who would otherwise have been entitled to a fractional share of Common Stock were instead entitled to receive a proportional cash payment.

Unless noted, all shares of Common Stock, including Common Stock underlying warrants, stock options, and restricted stock units, as well as all conversion ratios, exercise prices, conversion prices and per share information in the Condensed Consolidated Financial Statements have been retroactively adjusted to reflect the 1-for-20 Reverse Stock Split, as if the split occurred at the beginning of the earliest period presented in this quarterly report.

Unaudited Interim Financial Information

4 unchanged sentences

These interim Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and Notes thereto contained in the Company's Annual Report on Form 10-K for the year ended December 31, 2023 (the "2023 10-K").

The Condensed Consolidated Results of Operations for the three and nine months ended September 30, 2023 are not necessarily indicative of the results to be anticipated for the entire year ending December 31, 2023 or thereafter.

All references to September 30, 2023 and 2022 in the Notes to Condensed Consolidated Financial Statements are unaudited.

The Condensed Consolidated Results of Operations for the three months ended March 31, 2024 are not necessarily indicative of the results to be anticipated for the entire year ending December 31, 2024 or thereafter.

All references to March 31, 2024 and 2023 in the Notes to Condensed Consolidated Financial Statements are unaudited.

Use of Estimates and Judgments in the Preparation of the Condensed Consolidated Financial Statements

4 unchanged sentences

The Company evaluates its estimates and assumptions on an ongoing basis.

The Company tests goodwill for impairment annually during the fourth quarter as of October 1, or more frequently when events or changes in circumstances indicate that fair value is below carrying value.

The Company has a single reporting unit.

Accordingly, the impairment assessment for goodwill is performed at the enterprise level.

Goodwill is reviewed for possible impairment between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair

value of the reporting unit below its carrying value.

The Company has the option to first perform qualitative testing to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying value.

The qualitative evaluation is an assessment of factors, including operating results and cost factors, as well as industry, market and macroeconomic conditions, to determine whether it is more likely than not that the fair value of the reporting unit is less than the respective carrying amount, including goodwill.

If the Company chooses not to complete a qualitative assessment or if the initial assessment indicates that it is more likely than not that the carrying value of the reporting unit exceeds its estimated fair value, additional quantitative testing is required.

The fair value of the reporting unit is determined utilizing a discounted cash flow model, and a market value approach is utilized to supplement the discounted cash flow model.

The estimated fair value of a reporting unit is determined based on assumptions regarding estimated future cash flows, discount rates, long-term growth rates and market values.

Additionally, the Company considers income tax effects from any tax-deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment charge.

The Company monitors for events and circumstances that could negatively impact the key assumptions in determining fair value, including long-term revenue growth projections, profitability, discount rates, volatility in the Company's market capitalization, and general industry, market and macroeconomic conditions.

In the second quarter of 2023, the Company performed a quantitative goodwill impairment test using a discounted cash flow model, supported by a market approach.

The Company's reporting unit did not pass the goodwill impairment test, and as a result, the Company recorded a $ 44.1 million non-cash impairment charge during the nine months ended September 30, 2023.

In the third quarter of 2022, the Company performed a quantitative goodwill impairment test using a discounted cash flow model, supported by a market approach.

The Company's reporting unit did not pass the goodwill impairment test, and as a result, the Company recorded a $ 46.3 million non-cash impairment charge during the three and nine months ended September 30, 2022.

For further information refer to Footnote 4 , Goodwill .

Recoverability of Other Long-Lived Assets

The Company's other long-lived assets consist primarily of property and equipment and right-of-use ("ROU") assets.

The Company evaluates its ROU and long-lived assets for impairment whenever events or changes in circumstances indicate the carrying value of such assets may not be recoverable.

The Company performed an analysis in the third quarter of 2023 related to the abandonment of two leased office spaces, which changed the extent and manner for which the ROU assets and related long-lived assets were being used.

The Company recorded an impairment charge of $ 1.5 million related to the ROU assets for the three and nine months ended September 30, 2023.

Preferred Stock

8 unchanged sentences

If the instrument meets either of these criteria, the Company will accrete the carrying value to the redemption value.

The Preferred Stock has not been adjusted to its redemption amount as of September 30, 2023 because a deemed liquidation event is not considered probable.

The Preferred Stock has not been adjusted to its redemption amount as of March 31, 2024 because a deemed liquidation event is not considered probable.

The Preferred Stock includes a change of control put option which allows the holders of the Preferred Stock to require the Company to repurchase such holders' shares in cash in an amount equal to the initial purchase price plus accrued dividends.

The change of control put option was determined to be a derivative liability.

As of September 30, 2023, the probability of a change of control was determined to be remote and the fair value of the change of control derivative was determined to be negligible.

As of March 31, 2024, the probability of a change of control was determined to be remote and the fair value of the change of control derivative was determined to be negligible.

Warrants Liability

1 unchanged sentence

("CVI") in connection with the private placement described in Footnote 4 , Convertible Redeemable Preferred Stock and Stockholders' Equity .

The warrants were determined to be freestanding financial instruments that qualify for liability treatment as a result of net cash settlement features associated with a cap on the issuance of shares, under certain

circumstances, or upon a change of control.

Changes in the fair value of these instruments are recorded in other income, net in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).

Changes in the fair value of these instruments are recorded in other income (expense), net in the Condensed Consolidated Statements of Operations and Comprehensive Loss.

The fair value of each warrant is estimated utilizing an option pricing model.

Significant valuation inputs include the exercise price, price and expected volatility of the Company's Common Stock, risk-free rate and the remaining term of the warrants.

As of September 30, 2023, the probability of a change of control was determined to be remote and did not require an enhancement to the valuation technique.

Other Income, Net

Other income, net represents income and expenses incurred that are generally not recurring in nature or are not part of the Company's normal operations.

The following is a summary of the components of other income, net:

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

As of March 31, 2024, the probability of a change of control was determined to be remote and did not require an enhancement to the valuation technique.

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 the Company's normal operations.

The following is a summary of the significant components of other income (expense), net:

Three Months Ended March 31,

(In thousands) 2024 2023

1 unchanged sentence

Other ( 11 ) 3

Total other income, net

Total other income (expense), net

$ 275 $ ( 1,812 )

9 unchanged sentences

The following is a summary of the Common Stock equivalents for the securities outstanding during the respective periods that have been excluded from the computation of diluted net loss per common share, as their effect would be anti-dilutive:

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

2023 2022 2023 2022

Three Months Ended March 31,

Preferred stock (1)

5 unchanged sentences

Total 5,268,561 5,040,359

(1) Includes the effect of potential Common Stock that would be issued to settle unpaid dividends accrued to holders of the Preferred Stock if they elected to convert their shares at the beginning of the period.

(2) A contingent consideration liability was recognized as part of the Company's acquisition of Shareablee, Inc.

2 unchanged sentences

Settlement of this liability in Common Stock could potentially dilute basic earnings per share in future periods.

The Company paid the first installment of $ 3.7 million in cash, and it is therefore excluded from Common Stock equivalents herein.

The Company calculated a potential anti-dilutive share count based on the remaining expected payments totaling $ 4.9 million and the $ 0.61 per share closing price of the Company's Common Stock on the Nasdaq Global Select Market on September 29, 2023.

The Company calculated a potential anti-dilutive share count based on the expected payments totaling $ 8.6 million and the $ 1.65 per share closing price of the Company's Common Stock on the Nasdaq Global Select Market on September 30, 2022.

A significant portion of the Company's net operating loss carryforwards are subject to an annual limitation under Section 382 of the Internal Revenue Code.

The Company has concluded that an ownership change occurred in 2021 as a result of the Transactions which has triggered further limitations on the use of its net operating loss carryforwards.

The limitation calculations are currently being finalized by the Company and are expected to cause a significant portion of the Company's net operating loss carryforwards to expire prior to use.

Due to the Company's valuation allowance position in the United States, the required revaluation of its deferred tax assets related to these limited U.S.

federal and state net operating loss carryforwards is not expected to have a material impact on the Condensed Consolidated Financial Statements or related disclosures.

The Company paid the first installment of $ 3.7 million in cash in 2023 and the second installment of $ 3.7 million in cash in the first quarter of 2024.

The Company calculated a potential anti-dilutive share count for the three months ended March 31, 2024 based on the remaining expected payments totaling $ 1.2 million and the $ 15.40 per share closing price of the Company's Common Stock on the Nasdaq Global Select Market on March 28, 2024.

The Company calculated a potential anti-dilutive share count for the three months ended March 31, 2023 based on the expected payments totaling $ 4.9 million and the $ 24.60 per share closing price of the Company's Common Stock on the Nasdaq Global Select Market on March 31, 2023.

The Company's net operating loss carryforwards are subject to an annual limitation under Section 382 of the Internal Revenue Code.

The Company completed a Section 382 study in 2023 and concluded that an ownership change occurred in May 2021 as a result of its Preferred Stock transactions.

Therefore, all of the Company's U.S.

net operating loss carryforwards are subject to annual limitations under Section 382.

The Company's deferred tax asset related to its U.S.

federal net operating loss carryforwards has been revalued to reflect the amount of carryforwards that are utilizable under the Section 382 limitations;

however, the same analysis for the Company's state net operating loss carryforwards has not yet been completed.

Due to the Company's valuation allowance position in the United States, the required revaluation of its deferred tax asset related to these limited U.S.

state net operating loss carryforwards is not expected to have a material impact on the Condensed Consolidated Financial Statements or related disclosures.

Revenue Recognition

The following table presents the Company's revenue disaggregated by solution group, geographical market and timing of transfer of products and services.

The Company attributes revenue to geographical markets based on the location of the customer.

The Company has one reportable segment in accordance with ASC 280, Segment Reporting ;

as such, the disaggregation of revenue below reconciles directly to its unique reportable segment.

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

(In thousands) 2023 2022 2023 2022

The following table presents the Company's revenue disaggregated by solution group.

(In thousands) Three Months Ended March 31,

By solution group:

Digital Ad Solutions $ 50,501 $ 52,360 $ 153,597 $ 157,127

Cross Platform Solutions 40,499 40,423 122,645 121,056

Content & Ad Measurement

Syndicated Audience $ 64,600 $ 70,466

Cross-Platform 8,020 6,245

Total Content & Ad Measurement 72,620 76,711

Research & Insight Solutions 14,175 14,847

Total $ 86,795 $ 91,558

The following table presents the Company's revenue disaggregated by geographical market and timing of transfer of products and services.

The Company attributes revenue to geographical markets based on the location of the customer.

(In thousands) Three Months Ended March 31,

By geographical market:

11 unchanged sentences

The following table provides information about receivables, contract assets, contract liabilities and customer advances from contracts with customers:

(In thousands) September 30, 2023 December 31, 2022

(In thousands) March 31, 2024 December 31, 2023

Accounts receivable, net $ 55,724 $ 63,826

4 unchanged sentences

Significant changes in the current contract liabilities balance are as follows:

Nine Months Ended September 30,

Three Months Ended March 31,

(In thousands) 2024 2023

2 unchanged sentences

Remaining Performance Obligations

As of September 30, 2023, approximately $ 210 million of revenue is expected to be recognized from remaining performance obligations that are unsatisfied (or partially unsatisfied) for non-cancelable contracts with an original expected duration of longer than one year.

As of March 31, 2024, approximately $ 220 million of revenue is expected to be recognized from remaining performance obligations that are unsatisfied (or partially unsatisfied) for non-cancelable contracts with an original expected duration of longer than one year.

The Company expects to recognize revenue on approximately 42 % of these remaining performance obligations during the remainder of 2024, approximately 35 % in 2025, and approximately 15 % in 2026, with the remainder recognized thereafter.

In the second quarter of 2023, the Company concluded that it was more likely than not that the estimated fair value of its reporting unit was less than its carrying value.

In its assessment, the Company considered the decline in the Company's stock price and market capitalization, among other factors.

The Company performed quantitative testing on its reporting unit using a discounted cash flow model (a form of the income approach) utilizing Level 3 unobservable inputs, supported by a market approach.

The Company relied in part on the work of an independent valuation firm engaged by the Company to provide inputs as to the fair value of the reporting unit and to assist in the related calculations and

The Company's reporting unit did not pass the goodwill impairment test, and as a result the Company recorded a $ 44.1 million impairment charge for the nine months ended September 30, 2023.

In the third quarter of 2022, in conjunction with its annual test as of October 1, 2022, the Company performed a quantitative goodwill impairment test as of September 30, 2022.

The Company's reporting unit did not pass the goodwill impairment test, and as a result the Company recorded a $ 46.3 million impairment charge for the three and nine months ended September 30, 2022.

The change in the carrying value of goodwill is as follows:

(In thousands)

Balance as of December 31, 2021

Translation adjustments ( 1,438 )

Impairment charge ( 46,300 )

Balance as of December 31, 2022

Translation adjustments ( 331 )

Impairment charge ( 44,100 )

Balance as of September 30, 2023

Convertible Redeemable Preferred Stock and Stockholders' Equity

2 unchanged sentences

Net proceeds from the Transactions totaled $ 187.9 million after deducting issuance costs.

The Preferred Stock is convertible at the option of the holders at any time into shares of Common Stock based on a conversion rate set in accordance with the Certificate of Designations of the Preferred Stock.

The Preferred Stock is convertible at the option of the holders at any time into a number of shares of Common Stock based on a conversion rate set in accordance with the Certificate of Designations of the Preferred Stock.

The conversion right is subject to certain anti-dilution adjustments and customary provisions related to partial dividend periods.

As of September 30, 2023, each share of Preferred Stock would have been convertible into 1.097283 shares of Common Stock, with such assumed conversion rate scheduled to return to 1.00 upon payment of accrued dividends.

As of September 30, 2023, no shares of Preferred Stock have been converted into Common Stock.

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 circumstances.

In addition, such holders are entitled to request, and the Company will take all actions reasonably necessary to pay, a one-time dividend ("Special Dividend") equal to the highest dividend that the Company's Board determines can be paid at the applicable time (or a lesser amount agreed upon by the holders), subject to additional conditions and limitations set forth in a Stockholders Agreement entered into by the Company and the holders on March 10, 2021 (the "Stockholders Agreement").

Due to the Reverse Stock Split effected on December 20, 2023, the conversion factor was adjusted to 0.05 pursuant to the Certificate of Designations of the Preferred Stock.

As of March 31, 2024, each share of Preferred Stock was convertible into 0.056954 shares of Common Stock, with such assumed conversion rate scheduled to return to 0.05 upon payment of accrued dividends.

As of March 31, 2024, no shares of Preferred Stock have been converted into Common Stock.

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 (on June 30 of each year) and subject to increase under certain specified circumstances.

The annual dividend accrues on a daily basis from and including the issuance date of such shares, whether

or not declared.

In the event the annual dividends are not paid on the annual payment date, the dividends otherwise payable on such date shall continue to accrue and cumulate at a rate of 9.5 % per annum, until such failure is cured.

In addition, the holders of Preferred Stock are entitled to request, and the Company will take all actions reasonably necessary to pay, a one-time dividend ("Special Dividend") equal to the highest dividend that the Company's Board determines can be paid at the applicable time (or a lesser amount agreed upon by the holders), subject to additional conditions and limitations set forth in a Stockholders Agreement entered into by the Company and the holders on March 10, 2021 (the "Stockholders Agreement").

As set forth in the Stockholders Agreement, the Company may be obligated to obtain debt financing in order to effectuate the Special Dividend.

At an annual meeting of stockholders of the Company held on June 15, 2023 (the "Annual Meeting"), the Company's stockholders approved proposals permitting the payment of annual dividends on the Preferred Stock in the form of cash, shares of Common Stock, additional shares of Preferred Stock, or a combination thereof.

On the same date, each holder of Preferred Stock waived its right to receive on June 30, 2023 the annual dividends otherwise payable by the Company on that date (the "Waivers"), and the Company's Board elected to defer the June 30, 2023 payment.

Under the Waivers and the Certificate of Designations governing the Preferred Stock, the deferred dividends will accrue and accumulate at a rate of 9.5 % per year from June 30, 2023 until declared and paid, with payment to occur on or before December 31, 2023 subject to certain conditions.

As of September 30, 2023, accrued dividends for the Preferred Stock totaled $ 19.8 million.

At the annual meeting of stockholders of the Company held on June 15, 2023 (the "Annual Meeting"), the Company's stockholders approved proposals permitting the payment of annual dividends on the Preferred Stock in the form of cash, shares of Common Stock, additional shares of Preferred Stock, or a combination thereof, subject to conditions set forth in the Certificate of Designations.

On the same date, each holder of Preferred Stock waived its right to receive on June 30, 2023 the annual dividends otherwise payable by the Company on that date (the "June Waivers").

Upon receipt of the June waivers, the Company's Board elected to defer the June 30, 2023 payment.

Under the June Waivers and the Certificate of Designations, the deferred dividends would accrue and accumulate at a rate of 9.5 % per year from June 30, 2023 until declared and paid, with payment to occur on or before December 31, 2023.

On December 26, 2023, each holder of Preferred Stock waived its right to receive the deferred dividends on or before December 31, 2023 (the "December Waivers").

Under the December Waivers and the Certificate of Designations, the deferred dividends will continue to accrue at a rate of 9.5 % per year until paid, with payment to occur on or before June 30, 2024, subject to certain conditions.

As of March 31, 2024, accrued dividends for the Preferred Stock totaled $ 28.4 million.

2019 Issuance and Sale of Common Stock and Warrants

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As a result of this exercise, the Company issued 136,425 shares of Common Stock to CVI on October 14, 2019.

In addition, the number of shares issuable under the Company's Series A Warrants was increased by 2,728,513 .

The Series A Warrants are exercisable by the holders for a period of five years from the CVI Closing Date and are currently exercisable into 5,457,026 shares of Common Stock.

In addition, the number of shares issuable under the Series A Warrants was increased by 136,425 .

The Series A Warrants are exercisable by the holders for a period of five years from the CVI Closing Date and are currently exercisable into 272,851 shares of Common Stock, which is equal to the Initial Shares plus the number of shares issued pursuant to the exercise of the Series C Warrants (described above).

The exercise price for the Series A Warrants was $ 240.00 upon issuance but was subsequently adjusted, as described below.

The Series A Warrants may be exercised for cash or through a net settlement feature under certain circumstances.

The exercise price for the Series A Warrants is subject to anti-dilution adjustment in certain circumstances, including upon certain issuances of capital stock.

Upon the issuance of the Preferred Stock in 2021, the Company adjusted the exercise price of the Series A Warrants from $ 12.00 to $ 2.4719 per share, the closing price of the Transactions.

On March 15, 2023, the Company granted Common Stock awards to certain non-executive employees valued at $ 1.01 per share (the closing price of the Common Stock on March 15, 2023) under the Company's annual

incentive compensation plan, resulting in a further adjustment of the Series A Warrants exercise price from $ 2.4719 to $ 1.01 per share.

The estimated fair value of the Series A Warrants immediately after the exercise price adjustment on March 15, 2023 was $ 1.7 million, reflecting an increase of $ 1.0 million compared to the value as of December 31, 2022.

Upon the issuance of the Preferred Stock, the Company adjusted the exercise price of the Series A Warrants from $ 240.00 to $ 49.438 per share, the closing price of the Transactions.

On March 15, 2023, the Company granted Common Stock awards to certain non-executive employees valued at $ 20.20 per share (the closing price of the Common Stock on March 15, 2023) under the Company's annual incentive compensation plan, resulting in a further adjustment of the Series A Warrants exercise price from $ 49.438 to $ 20.20 per share.

On March 15, 2024, the Company granted Common Stock awards to certain non-executive employees valued at $ 15.83 per share (the closing price of the Common Stock on March 15, 2024) under the Company's annual incentive compensation plan, resulting in a further adjustment of the Series A Warrants exercise price from $ 20.20 to $ 15.83 .

CVI will not have the right to exercise any warrant that would result in CVI beneficially owning more than 4.99 % of the outstanding Common Stock after giving effect to such exercise.

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In addition, if and to the extent the exercise of any warrants would, together with the issuances of the Initial Shares and the shares issued pursuant to the exercise of any other warrants, result in the issuance of 20.0 % or more of the outstanding Common Stock of the Company on the CVI Closing Date, the Company intends to, in lieu of issuing such shares, settle the obligation to issue such shares in cash.

The estimated fair value of the Series A Warrants as of September 30, 2023 was $ 0.3 million and is classified within other current liabilities on the Condensed Consolidated Balance Sheets.

The estimated fair value of the Series A Warrants as of March 31, 2024 was $ 0.4 million and is classified within other current liabilities on the Condensed Consolidated Balance Sheets.

Refer to Footnote 6 , Fair Value Measurements , for further information.

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The Revolving Credit Agreement had an original borrowing capacity equal to $ 25.0 million and bore interest on borrowings at a Eurodollar Rate (as defined in the Revolving Credit Agreement) that was based on LIBOR.

The Company may also request the issuance of letters of credit under the Revolving Credit Agreement in an aggregate amount up to $ 5.0 million, which reduces the amount of available borrowings by the amount of such issued and outstanding letters of credit.

The facility has a maturity of three years from the closing date of the agreement.

The Company may also request the issuance of letters of credit under

the Revolving Credit Agreement in an aggregate amount up to $ 5.0 million, which reduces the amount of available borrowings by the amount of such issued and outstanding letters of credit.

The facility originally had a maturity of three years from the closing date of the agreement.

On February 25, 2022, the Company entered into an amendment (the "2022 Amendment") to the Revolving Credit Agreement to expand its aggregate borrowing capacity from $ 25.0 million to $ 40.0 million.

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Among other things, the 2023 Amendment (i) increased the minimum Consolidated EBITDA and Consolidated Asset Coverage Ratio financial covenant requirements under the Revolving Credit Agreement, (ii) modified the measurement periods for certain financial covenants contained in the Revolving Credit Agreement, (iii) introduced a minimum liquidity covenant, and (iv) modified the Applicable Rate definition in the Revolving Credit Agreement to increase the Applicable Rate payable on SOFR-based loans to 3.50 %.

As modified, the Revolving Credit Agreement requires the Company to maintain:

• minimum Consolidated EBITDA (as defined in the Revolving Credit Agreement) of not less than $ 22.0 million, $ 24.0 million, $ 32.0 million and $ 35.0 million for the most recently ended four fiscal quarter period, tested as of the last day of the fiscal quarters ending on March 31, June 30, September 30 and December 31, 2023, respectively;

As of March 31, 2024, the Revolving Credit Agreement required the Company to maintain:

• a minimum Consolidated Asset Coverage Ratio (as defined in the Revolving Credit Agreement) of not less than 2.0 to 1.0, tested as of the last day of each calendar month through maturity of the Revolving Credit Agreement;

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• minimum Liquidity (as defined in the Revolving Credit Agreement) of $ 28.0 million, tested as of the last business day of each calendar month through maturity of the Revolving Credit Agreement.

Certain of these covenants were amended subsequent to March 31, 2024, as described below.

The Revolving Credit Agreement contains restrictive covenants that limit the Company's ability to, among other things, incur additional indebtedness or liens, make investments and loans, enter into mergers and acquisitions, make or declare dividends and other payments, enter into certain contracts, sell assets and engage in transactions with affiliates.

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If an event of default occurs and is continuing, the Agent or the Required Lenders may accelerate any amounts outstanding and terminate lender commitments.

The Company was in compliance with the covenants under the amended Revolving Credit Agreement as of September 30, 2023.

The Company was in compliance with the covenants under the Revolving Credit Agreement as of March 31, 2024.

The Revolving Credit Agreement is guaranteed by the Company and its domestic subsidiaries (other than Excluded Subsidiaries (as defined in the Revolving Credit Agreement)) and is secured by a first lien security interest in substantially all assets of the Company and its domestic subsidiaries (other than Excluded Subsidiaries), subject to certain customary exclusions.

As of September 30, 2023, the Company had outstanding borrowings of $ 16.0 million, and issued and outstanding letters of credit of $ 3.4 million, under the amended Revolving Credit Agreement, with remaining borrowing capacity of $ 20.6 million.

During the second quarter of 2023, the Company reclassified the outstanding borrowings to current liabilities from non-current liabilities as the facility matures in May 2024.

As of March 31, 2024, the Company had outstanding borrowings of $ 16.0 million, and issued and outstanding letters of credit of $ 3.2 million, under the amended Revolving Credit Agreement, with remaining borrowing capacity of $ 20.8 million.

The outstanding borrowings are classified within current liabilities based on the maturity date of the facility.

On May 3, 2024, the Company entered into an additional amendment (the "2024 Amendment") to the Revolving Credit Agreement.

Among other things, the 2024 Amendment (i) extended the maturity date of the facility from May 5, 2024 to November 5, 2024;

(ii) reduced the Company's aggregate borrowing capacity under the facility from $ 40.0 million to $ 25.0 million;

(iii) increased the Applicable Rate payable on SOFR-based loans to 4.50 %;

(iv) increased the minimum Consolidated Asset Coverage Ratio covenant and decreased the minimum Liquidity covenant;

(v) limited certain Restricted Payments (as defined in the Revolving Credit Agreement) with respect to the Company's equity interests;

(vi) required a repayment of $ 6.0 million to reduce the principal amount outstanding under the Revolving Credit Agreement;

and (vii) provided for certain amendment fees, including a fee of 2.0 % of aggregate commitments due on the maturity date unless all obligations are paid in full prior to such date.

Refer to F ootnote 11 , Subsequent Events for additional information about the 2024 Amendment.

Fair Value Measurements

The Company's financial instruments measured at fair value in the accompanying Condensed Consolidated Balance Sheets on a recurring basis consist of the following:

September 30, 2023 December 31, 2022

March 31, 2024 December 31, 2023

(In thousands) Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total

Money market funds (1)

$ 110 $ — $ — $ 110 $ 2,455 $ — $ — $ 2,455

Contingent consideration liability (1)

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Total liabilities $ — $ 1,202 $ 383 $ 1,585 $ — $ 4,806 $ 669 $ 5,475

(1) Level 1 cash equivalents are invested in money market funds that are intended to maintain a stable net asset value of $ 1.00 per share by investing in liquid, high quality U.S.

dollar-denominated money market instruments with maturities less than three months.

(2) The fair value of this liability as of September 30, 2023 and December 31, 2022 is derived from a technique which utilizes market-corroborated inputs that result in classification as a Level 2 fair value measurement as of such date.

The non-current portion of the contingent consideration liability is classified within non-current liabilities on the Condensed Consolidated Balance Sheets.

The current portion of the contingent consideration liability was $ 3.7 million and $ 7.1 million as of September 30, 2023 and December 31, 2022, respectively.

The non-current portion of the contingent consideration liability was $ 1.1 million and $ 1.0 million as of September 30, 2023 and December 31, 2022, respectively.

(1) The fair value of this liability as of March 31, 2024 and December 31, 2023 is derived from a technique which utilizes market-corroborated inputs that result in classification as a Level 2 fair value measurement as of such date.

The contingent consideration liability is classified as current on the Condensed Consolidated Balance Sheets as of March 31, 2024 and December 31, 2023.

(2) The fair value of this liability is derived from a technique which utilizes inputs, certain of which are significant and unobservable, that result in classification as a Level 3 fair value measurement.

Warrants liability includes only the Series A warrants as of September 30, 2023 and December 31, 2022.

Warrants liability includes only the Series A warrants as of March 31, 2024 and December 31, 2023.

Warrants liability is classified within other current liabilities on the Condensed Consolidated Balance Sheets.

The elimination of the option pricing model used to value the contingent consideration liability reflected a change in the Company's valuation technique during the nine months ended September 30, 2022.

There were no other changes to the Company's valuation techniques or methodologies during the three and nine months ended September 30, 2023 and 2022.

The following tables present the changes in the Company's recurring Level 3 fair valued instruments for the nine months ended September 30, 2023 and 2022, respectively:

There were no changes to the Company's valuation techniques or methodologies during the three months ended March 31, 2024 and 2023.

The following tables present the changes in the Company's recurring Level 3 fair valued instruments for the three months ended March 31, 2024 and 2023, respectively:

(In thousands) Warrants Liability

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Total gain recognized due to remeasurement (1)

Balance as of September 30, 2023 $ 311

(1) The gain on remeasurement of the warrants liability was recorded in other income, net, in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).

(In thousands) Contingent Consideration Liability Warrants Liability

Balance as of March 31, 2024 $ 383

(1) The gain on remeasurement of the warrants liability was recorded in other income (expense), net, in the Condensed Consolidated Statements of Operations and Comprehensive Loss.

(In thousands) Warrants Liability

Balance as of December 31, 2022 $ 718

Total loss (gain) recognized due to remeasurement (1)

2,348 ( 8,471 )

Transfer to Level 2 (2)

Balance as of September 30, 2022 $ — $ 2,049

(1) The loss due to remeasurement of the contingent consideration liability was recorded in general and administrative expense, and the gain on remeasurement of the warrants liability was recorded in other income, net, in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).

(2) The contingent consideration liability was transferred from Level 3 to Level 2 at the beginning of the second quarter of 2022 due to the resolution of the contingency regarding the amount of consideration payable.

The following table displays the valuation technique and the significant inputs, certain of which are unobservable, for the Company's Level 3 liabilities that existed as of September 30, 2023 and December 31, 2022 that are measured at fair value on a recurring basis:

Total loss recognized due to remeasurement (1)

Balance as of March 31, 2023 $ 2,533

(1) The loss due to remeasurement of the warrants liability was recorded in other income (expense), net, in the Condensed Consolidated Statements of Operations and Comprehensive Loss.

The following table displays the valuation technique and the significant inputs, certain of which are unobservable, for the Company's Level 3 liabilities that existed as of March 31, 2024 and December 31, 2023 that are measured at fair value on a recurring basis:

Fair Value Measurements

Significant Valuation Technique Significant Valuation Inputs September 30, 2023 December 31, 2022

Significant Valuation Technique Significant Valuation Inputs March 31, 2024 December 31, 2023

Warrants liability Option pricing Stock price $ 15.40 $ 16.70

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The primary sensitivities in the valuation of the warrants liability are driven by the exercise price, the Common Stock price at the measurement date and the expected volatility of the Common Stock over the remaining term.

Fair Value Measurements on a Nonrecurring Basis

For the nine months ended September 30, 2023, the Company recorded a goodwill impairment charge of $ 44.1 million.

For the three and nine months ended September 30, 2022, the Company recorded a goodwill impairment charge of $ 46.3 million.

Refer to Footnote 4 , Goodwill for further details.

The remeasurement of goodwill is classified as a non-recurring Level 3 fair value assessment due to the significance of unobservable inputs developed in the determination of the fair value.

The Company used a discounted cash flow model to determine the estimated fair value of the reporting unit.

The Company made estimates and assumptions regarding future cash flows, discount rates, long-term growth rates and market values to determine the reporting unit's estimated fair value.

It is possible that future changes in such circumstances, or in the variables associated with the judgments, assumptions and estimates used in assessing the fair value of the reporting unit, would require the Company to record additional non-cash impairment charges.

Accrued Expenses

(In thousands) September 30, 2023 December 31, 2022

(In thousands) March 31, 2024 December 31, 2023

Accrued data costs $ 17,715 $ 15,529

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Transactions with WPP

As of September 30, 2023 (based on public filings), WPP plc and its affiliates ("WPP") owned 11,319,363 shares of the Company's outstanding Common Stock, representing 11.9 % of the outstanding Common Stock.

As of March 31, 2024 (based on public filings), WPP plc and its affiliates ("WPP") owned 565,968 shares of the Company's outstanding Common Stock, representing 11.9 % of the outstanding Common Stock.

The Company provides WPP, in the normal course of business, services amongst its different product lines and receives various services from WPP supporting the Company's data collection efforts.

The Company's results from transactions with WPP, as reflected in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss), are as follows:

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

The Company's results from transactions with WPP, as reflected in the Condensed Consolidated Statements of Operations and Comprehensive Loss, are as follows:

Three Months Ended March 31,

(In thousands) 2024 2023

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The Company has the following balances related to transactions with WPP, as reflected in the Condensed Consolidated Balance Sheets:

(In thousands) September 30, 2023 December 31, 2022

(In thousands) March 31, 2024 December 31, 2023

Accounts receivable, net $ 1,650 $ 525

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Through May 15, 2023, Charter, Qurate, and Pine each held 33.3 % of the outstanding shares of Preferred Stock.

On May 16, 2023, Qurate sold its Preferred Stock to Liberty, and as of September 30, 2023, Charter, Liberty and Pine each hold 33.3 % of the outstanding shares of Preferred Stock.

On May 16, 2023, Qurate sold its Preferred Stock to Liberty, and as of March 31, 2024, Charter, Liberty and Pine each hold 33.3 % of the outstanding shares of Preferred Stock.

Charter, Liberty and Pine are entitled to convert the Preferred Stock into shares of Common Stock and to vote as a single class with the holders of the Common Stock as set forth in the Certificate of Designations.

As of September 30, 2023 (based on public filings), Pine also owned 2,193,088 shares of the Company's outstanding Common Stock, representing 2.3 % of the outstanding Common Stock.

As of March 31, 2024 (based on public filings), Pine also owned 109,654 shares of the Company's outstanding Common Stock, representing 2.3 % of the outstanding Common Stock.

In addition, Charter, Liberty and Pine each designated two members of the Company's Board in accordance with the Stockholders Agreement.

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On the same date, each holder of Preferred Stock waived its right to receive on June 30, 2023 the annual dividends otherwise payable by the Company on that date.

The deferred dividends will accrue at a rate of 9.5 % per year from June 30, 2023 until declared and paid, with payment to occur on or before December 31, 2023 subject to certain conditions.

As of September 30, 2023, Charter, Liberty and Pine each owned 27,509,203 shares of Preferred Stock.

As of September 30, 2023, total accrued dividends to the holders of Preferred Stock were $ 19.8 million.

As of December 31, 2022, Charter, Qurate and Pine each owned 27,509,203 shares of Preferred Stock.

Accrued dividends to the holders of Preferred Stock as of December 31, 2022 were $ 7.9 million.

Under the waivers and the Certificate of Designations, the deferred dividends would accrue at a rate of 9.5 % per year from June 30, 2023 until declared and paid, with payment to occur on or before December 31, 2023.

On December 26, 2023, each holder of Preferred Stock waived its right to receive the deferred dividends on or before December 31, 2023.

Under these most recent waivers and the Certificate of Designations, the deferred dividends will continue to accrue at a rate of 9.5 % per year until paid, with payment to occur on or before June 30, 2024, subject to certain conditions.

As of March 31, 2024 and December 31, 2023, Charter, Liberty and Pine each owned 27,509,203 shares of Preferred Stock.

Accrued dividends to the holders of Preferred Stock as of March 31, 2024 and December 31, 2023 were $ 28.4 million and $ 24.1 million, respectively.

Concurrent with the closing of the Transactions on March 10, 2021, the Company entered into a ten-year Data License Agreement ("DLA") with Charter Communications Operating, LLC ("Charter Operating"), an affiliate of Charter.

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To date, however, neither party has indicated that it intends to terminate the DLA, and the parties are discussing a resolution to the matter.

The Company's results from transactions with Charter and its affiliates, as reflected in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss), are detailed below:

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

The Company's results from transactions with Charter and its affiliates, as reflected in the Condensed Consolidated Statements of Operations and Comprehensive Loss, are detailed below:

Three Months Ended March 31,

(In thousands) 2024 2023

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The Company has the following liability balances related to transactions with Charter and its affiliates, as reflected in the Condensed Consolidated Balance Sheet:

(In thousands) September 30, 2023 December 31, 2022

(In thousands) March 31, 2024 December 31, 2023

Accounts payable $ 12,388 $ 10,323

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Non-current portion of accrued data costs 23,049 21,908

In the third quarter of 2023, the Company entered into a finance lease with a third-party vendor that is not a related party.

In conjunction with this transaction, the third-party vendor purchased equipment for $ 2.5 million from a Pine affiliate (related party).

The Company had no additional transactions with Pine for the three and nine months ended September 30, 2023 and 2022.

The Company recognized revenues of $ 0.2 million during the three months ended September 30, 2023 and 2022, and $ 0.6 million during the nine months ended September 30, 2023 and 2022, from transactions with Qurate and its affiliates in the normal course of business as reflected in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).

The Company had no transactions with Liberty for the three and nine months ended September 30, 2023 and 2022.

The Company had no transactions with Pine and Liberty for the three months ended March 31, 2024 and 2023.

The Company recognized revenues of $ 0.2 million from transactions with Qurate and its affiliates in the normal course of business during the three months ended March 31, 2024 and 2023, as reflected in the Condensed Consolidated Statements of Operations and Comprehensive Loss.

Organizational Restructuring

On September 29, 2022, the Company communicated a workforce reduction as part of its broader efforts to improve cost efficiency and better align its operating structure and resources with strategic priorities (collectively, the "Restructuring Plan").

In addition to employee terminations, the Restructuring Plan is expected to include the reallocation of commercial and product development resources;

In addition to employee terminations, the Restructuring Plan has included the reallocation of commercial and product development resources;

reinvestment in and modernization of key technology platforms;

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and reduction of other operating expenses, including software and facility costs.

The Company may also determine to exit certain activities in certain geographic regions in order to more effectively align resources with business priorities.

In connection with the Restructuring Plan, which was authorized by the Board on September 19, 2022, the Company will incur certain exit-related costs.

These costs are estimated to range between $ 10 million and $ 15 million.

The Company expects implementation of the Restructuring Plan, including cash payments, to be substantially complete in the fourth quarter of 2023.

The table below summarizes the activity and balance of the restructuring liability as of September 30, 2023 and December 31, 2022, which is recorded in accrued expenses in the Condensed Consolidated Balance Sheets, and the changes in the accrued amounts for the nine months ended September 30, 2023:

In connection with the Restructuring Plan, which was authorized by the Board on September 19, 2022, the Company has incurred certain exit-related costs.

These costs were estimated to range between $ 10 million and $ 15 million.

The Company believes that the Restructuring Plan, including cash payments, will be substantially complete in 2024.

The following table summarizes costs incurred related to the Restructuring Plan for the three months ended March 31, 2024 and 2023.

Three Months Ended March 31,

(In thousands) 2024 2023

Severance and related costs $ 401 $ 888

Total restructuring $ 460 $ 998

The table below summarizes the balance of restructuring liability as of March 31, 2024 and December 31, 2023, which is recorded in accrued expenses in the Condensed Consolidated Balance Sheets:

(In thousands) Severance and related costs Other Total Restructuring

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Foreign exchange 78 — 78

Balance as of September 30, 2023

Balance as of March 31, 2024

$ 890 $ 124 $ 1,014

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The Company has certain long-term contractual arrangements that have fixed and determinable payment obligations including unconditional purchase obligations with multichannel video programming distributors ("MVPDs") and other providers for set-top box and connected (Smart) television data.

These agreements have remaining terms of less than one year to eight years .

As of September 30, 2023, the total fixed payment obligations related to set-top box and connected television data agreements are $ 279.5 million and $ 2.5 million, respectively.

The information set forth below summarizes the contractual obligations, by year, as of September 30, 2023:

These agreements have remaining terms of less than one year to seven years .

As of March 31, 2024, the total fixed payment obligations related to set-top box and connected television data agreements are $ 288.7 million and $ 28.3 million, respectively.

The information set forth below summarizes the contractual obligations, by year, as of March 31, 2024:

(In thousands)

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Total $ 316,958

In addition, the Company expects to make variable payments related to a set-top box data agreement totaling an estimated $ 1.9 million by the end of 2023.

Contingencies

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The outcomes of legal proceedings are inherently unpredictable, subject to significant uncertainties, and could be material to the Company's operating results and cash flows for a particular period.

Vendor Contract Dispute

In April 2023, the Company received correspondence from counsel to a TV data provider disputing the manner in which payments by the Company to the data provider were calculated under a 2018 data license agreement between the parties.

Subsequent to September 30, 2023, the Company and the data provider entered into a new data license agreement, and the Company considers this matter resolved.

Other Matters

Current Matters

The Company is, and may become, a party to a variety of legal proceedings from time to time that arise in the normal course of the Company's business.

While the results of such legal proceedings cannot be predicted with certainty, management believes that, based on current knowledge, the final outcome of any such current pending matters will not have a material effect on the Company's financial position, results of operations or cash flows.

Regardless of the outcome, legal proceedings can have an adverse effect on the Company because of defense costs, diversion of management resources and other factors.

While the results of such legal proceedings cannot be predicted with certainty, management believes that, based on current knowledge, the final outcome of any such current pending matters will not have a material adverse effect on the Company's financial position, results of operations or cash flows.

Regardless of the outcome, legal proceedings can have a material effect on the Company because of defense costs, diversion of management resources and other factors.

Indemnification

The Company has entered into indemnification agreements with each of the Company's directors and certain officers, and the Company's amended and restated certificate of incorporation requires it to indemnify each of its directors and officers, to the fullest extent permitted by Delaware law, who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding by

reason of the fact that he or she is or was a director or officer of the Company.

The Company has paid and may in the future pay legal counsel fees incurred by current and former directors and officers who are involved in legal proceedings that require indemnification.

Similarly, certain of the Company's commercial contracts require it to indemnify contract counterparties under specified circumstances, and the Company may incur legal counsel fees and other costs in connection with these obligations.

Subsequent Events

On May 3, 2024, the Company entered into the third amendment (the "2024 Amendment") to the Revolving Credit Agreement.

Among other things, the 2024 Amendment (i) extended the maturity date of the Revolving Credit Agreement from May 5, 2024 to November 5, 2024;

(ii) reduced the aggregate lender commitments under the Revolving Credit Agreement from $ 40.0 million to $ 25.0 million;

(iii) modified the Applicable Rate definition in the Revolving Credit Agreement to increase the Applicable Rate payable on SOFR-based loans to 4.50 %;

(iv) increased the minimum consolidated asset coverage ratio covenant and decreased the minimum liquidity covenant contained in the Revolving Credit Agreement;

(v) limited certain Restricted Payments (as defined in the Revolving Credit Agreement) with respect to the Company's equity interests;

(vi) required a repayment of $ 6.0 million to reduce the principal amount outstanding under the Revolving Credit Agreement;

(vii) updated certain defined terms in the Revolving Credit Agreement to reflect the May 2023 transfer of shares of Preferred Stock from Qurate to Liberty;

and (viii) provided for certain amendment fees, including a fee of 2.0 % of aggregate commitments due on the maturity date (November 5, 2024) unless all obligations are paid in full prior to such date.

As of May 3, 2024, following the $ 6.0 million repayment described above, the Company had borrowings of $ 10.0 million and letters of credit totaling $ 3.2 million outstanding under the Revolving Credit Agreement.

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 1. Financial Statements