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Item 1. Financial Statements

2024-08-09 compared with 2024-05-10 · 190 added, 131 removed, 437 unchanged (42% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

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

25 unchanged sentences

Current operating lease liabilities 8,299 7,982

Current portion of contingent consideration 1,202 4,806

Contingent consideration 1,191 4,806

Other current liabilities 4,168 4,680

8 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 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)

100,000,000 shares authorized and 82,527,609 shares issued and outstanding as of June 30, 2024 and December 31, 2023;

aggregate liquidation preference of $ 236,616 as of June 30, 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 March 31, 2024 and December 31, 2023;

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

5,000,000 shares authorized as of June 30, 2024 and December 31, 2023;

no shares issued or outstanding as of June 30, 2024 or December 31, 2023

Common stock, $ 0.001 par value;

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

13,750,000 shares authorized as of June 30, 2024 and December 31, 2023;

5,227,876 shares issued and 4,889,637 shares outstanding as of June 30, 2024, and 5,093,380 shares issued and 4,755,141 shares outstanding as of December 31, 2023

Additional paid-in capital 1,699,689 1,696,612

1 unchanged sentence

Accumulated deficit ( 1,407,666 ) ( 1,396,420 )

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

Treasury stock, at cost, 338,239 shares as of June 30, 2024 and December 31, 2023

( 229,984 ) ( 229,984 )

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

Three Months Ended March 31,

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

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

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Research and development (2) (3)

8,373 8,790 17,140 17,709

General and administrative (2) (3)

2 unchanged sentences

Restructuring 493 4,104 953 5,102

Impairment of goodwill — 44,100 — 44,100

Total expenses from operations 87,765 141,063 176,437 236,448

1 unchanged sentence

Other income (expense), net 376 1,609 651 ( 203 )

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

(Loss) gain from foreign currency transactions ( 248 ) ( 168 ) 715 ( 1,634 )

Interest expense, net ( 444 ) ( 363 ) ( 1,016 ) ( 715 )

Loss before income taxes ( 2,244 ) ( 46,301 ) ( 3,455 ) ( 53,758 )

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

Income tax benefit 536 1,392 693 178

Net loss $ ( 1,708 ) $ ( 44,909 ) $ ( 2,762 ) $ ( 53,580 )

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(1) Transactions with related parties are included in the line items above as follows (refer to Footnote 9 , Related Party Transactions , of the Notes to Condensed Consolidated Financial Statements for additional information):

Three Months Ended March 31,

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

2024 2023 2024 2023

Revenues $ 2,397 $ 2,937 $ 4,915 $ 5,946

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

Three Months Ended March 31,

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

2024 2023 2024 2023

Cost of revenues $ 156 $ 244 $ 399 $ 322

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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 — — — — — — ( 1,708 ) — ( 1,708 )

Convertible redeemable preferred stock dividends (1)

— — — — — — ( 4,244 ) — ( 4,244 )

Restricted stock units distributed — — 131,817 — — — — — —

Payments for taxes related to net share settlement of equity awards — — ( 2,411 ) — ( 33 ) — — — ( 33 )

Amortization of stock-based compensation — — — — 580 — — — 580

Foreign currency translation adjustment — — — — — ( 110 ) — — ( 110 )

Balance as of June 30, 2024 82,527,609 $ 187,885 4,889,637 $ 5 $ 1,699,689 $ ( 16,207 ) $ ( 1,407,666 ) $ ( 229,984 ) $ 45,837

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

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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 — — — — — — ( 44,909 ) — ( 44,909 )

Convertible redeemable preferred stock dividends (1)

— — — — — — ( 3,872 ) — ( 3,872 )

Restricted stock units distributed — — 136,799 — 3 — — — 3

Payments for taxes related to net share settlement of equity awards — — ( 459 ) — ( 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 4,754,316 $ 5 $ 1,695,371 $ ( 14,542 ) $ ( 1,362,066 ) $ ( 229,984 ) $ 88,784

(1) Transactions for these line items were exclusively with related parties (refer to Footnote 5 , Convertible Redeemable Preferred Stock and Stockholders' Equity and Footnote 9 , Related Party Transactions , of the Notes to Condensed Consolidated Financial Statements for additional information).

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended March 31,

Six Months Ended June 30,

(In thousands) 2024 2023

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Depreciation 10,657 9,593

Stock-based compensation expense 1,378 1,117

Non-cash operating lease expense 2,653 2,847

Amortization of intangible assets 801 2,811

Stock-based compensation expense 2,389 2,778

Amortization expense of finance leases 1,656 849

Change in fair value of contingent consideration liability 89 96

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

Deferred tax (benefit) provision ( 132 ) 566

Amortization of intangible assets 1,601 3,612

Impairment of goodwill — 44,100

Deferred tax benefit ( 365 ) ( 675 )

Other 453 1,242

11 unchanged sentences

Financing activities :

Payments of line of credit ( 6,000 ) —

Contingent consideration payment at initial value ( 3,704 ) ( 1,037 )

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Cash, cash equivalents and restricted cash at end of period $ 14,843 $ 23,055

As of March 31,

As of June 30,

Cash and cash equivalents $ 14,655 $ 22,657

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Total cash, cash equivalents and restricted cash $ 14,843 $ 23,055

Three Months Ended March 31,

Six Months Ended June 30,

Supplemental disclosures of non-cash investing and financing activities :

Convertible redeemable preferred stock dividends accrued but not yet paid (related parties) $ 8,484 $ 7,697

Right-of-use assets obtained in exchange for finance lease liabilities 7,861 —

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

Right-of-use assets obtained in exchange for operating lease liabilities — 1,239

Change in accounts payable and accrued expenses related to capital expenditures 1,083 722

Right-of-use assets obtained in exchange for operating lease liabilities — 1,239

See accompanying Notes to Condensed Consolidated Financial Statements.

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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, change in fair value of warrants liability and contingent consideration have been aggregated within other operating activities on the Condensed Consolidated Statements of Cash Flows.

Reverse Stock Split

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However, the Company believes that the disclosures contained in this quarterly report comply with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), for a quarterly report on Form 10-Q and are adequate to make the information presented not misleading.

The interim Condensed Consolidated Financial Statements included herein reflect all adjustments (consisting of normal recurring adjustments) which are, in the opinion of management, necessary for a fair presentation of the financial position, results of operations and cash flows for the interim periods presented.

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 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.

The Condensed Consolidated Results of Operations for the three and six months ended June 30, 2024 are not necessarily indicative of the results to be anticipated for the entire year ending December 31, 2024 or thereafter.

All references to June 30, 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

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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 three and six months ended June 30, 2023.

For further information refer to Footnote 4 , Goodwill .

Preferred Stock

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The instrument was initially recognized at fair value net of issuance costs.

The Company reassesses whether the Preferred Stock is currently redeemable, or probable to become redeemable in the future, as of each reporting date.

The Company reassesses whether the Preferred Stock is currently redeemable, or probable to become redeemable in the

future, as of each reporting date.

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 March 31, 2024 because a deemed liquidation event is not considered probable.

The Preferred Stock has not been adjusted to its redemption amount as of June 30, 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 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

In June 2019, the Company issued warrants to CVI Investments, Inc.

("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 (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 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.

As of June 30, 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.

Other Income (Expense), Net

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

Three Months Ended March 31,

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

(In thousands) 2024 2023 2024 2023

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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 March 31,

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

2024 2023 2024 2023

Preferred stock (1)

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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 calculated a potential anti-dilutive share count for the three and six months ended June 30, 2024 based on the remaining expected payments totaling $ 1.2 million and the $ 14.19 per share closing price of the Company's Common Stock on the Nasdaq Global Select Market on June 28, 2024.

The Company calculated a potential anti-dilutive share count for the three and six months ended June 30, 2023 based on the expected payments totaling $ 4.9 million and the $ 16.20 per share closing price of the Company's Common Stock on the Nasdaq Global Select Market on June 30, 2023.

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

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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.

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.

Recent Accounting Guidance Issued But Not Adopted at June 30, 2024

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures, to improve the transparency of income tax disclosures by requiring consistent categories and greater disaggregation of information in the rate reconciliation and income taxes paid disaggregated by jurisdiction.

The amendments are effective for fiscal years beginning after December 15, 2024 and early adoption is permitted.

The amendments in this update should be applied on a prospective basis.

Retroactive application is permitted.

The Company expects to adopt the new standard effective January 1, 2025 and is currently evaluating the impact that this standard will have on its Consolidated Financial Statements and related disclosures.

In November 2023, the FASB issued ASU 2023-08, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures, which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses.

The amendments are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

Early adoption is permitted.

The Company is currently evaluating the impact that this standard will have on its Consolidated Financial Statements or related disclosures, but the Company does not believe that the adoption of this standard will have a significant impact to its Consolidated Financial Statements or related disclosures.

Revenue Recognition

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

(In thousands) Three Months Ended March 31,

(In thousands) Three Months Ended June 30, Six Months Ended June 30,

By solution group:

2024 2023 2024 2023

Content & Ad Measurement

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

(In thousands) Three Months Ended March 31,

(In thousands) Three Months Ended June 30, Six Months Ended June 30,

By geographical market:

2024 2023 2024 2023

United States $ 76,543 $ 84,999 $ 154,212 $ 167,640

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

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

(In thousands) June 30, 2024 December 31, 2023

Accounts receivable, net $ 53,904 $ 63,826

4 unchanged sentences

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

Three Months Ended March 31,

Six Months Ended June 30,

(In thousands) 2024 2023

2 unchanged sentences

Remaining Performance Obligations

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.

As of June 30, 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 30 % of these remaining performance obligations during the remainder of 2024, approximately 41 % in 2025, and approximately 19 % in 2026, with the remainder recognized thereafter.

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

(In thousands)

Balance as of December 31, 2022

Translation adjustments 587

Impairment charge ( 78,200 )

Balance as of December 31, 2023

Translation adjustments ( 711 )

Balance as of June 30, 2024 $ 309,649

Convertible Redeemable Preferred Stock and Stockholders' Equity

5 unchanged sentences

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.

As of June 30, 2024, each share of Preferred Stock was convertible into 0.057994 shares of Common Stock, with such assumed conversion rate scheduled to return to 0.05 upon payment of accrued dividends.

As of June 30, 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.

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.

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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.

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

On June 27, 2024, each holder of Preferred Stock further waived its right to receive the deferred dividends on or before June 30, 2024 (the "June 2024 Waivers").

In addition, each holder waived its right to receive on June 30, 2024 the annual dividends otherwise payable on that date for the dividend period ending June 29, 2024.

Under the June 2024 Waivers and the Certificate of Designations, the deferred dividends for both periods (2023 and 2024) would continue to accrue and accumulate at a rate of 9.5 % per year until declared and paid, with payment to occur on or before July 31, 2024, subject to certain conditions.

As of June 30, 2024, accrued dividends for the Preferred Stock totaled $ 32.6 million.

On July 24, 2024, the Company issued additional shares of Preferred Stock to the existing holders in exchange for cancellation of the Company's obligation to pay the deferred dividends described above.

For further information about this issuance, refer to Footnote 12 , Subsequent Events .

2019 Issuance and Sale of Common Stock and Warrants

On June 23, 2019, the Company entered into a Securities Purchase Agreement with CVI, pursuant to which CVI agreed to purchase (i) 136,425 shares of Common Stock (the "Initial Shares"), at a price of $ 146.60 per share and (ii) Series A Warrants, Series B-1 Warrants, Series B-2 Warrants and Series C Warrants, for aggregate gross proceeds of $ 20.0 million (the "Private Placement").

On June 23, 2019, the Company entered into a Securities Purchase Agreement with CVI Investments, Inc.

("CVI"), pursuant to which CVI agreed to purchase (i) 136,425 shares of Common Stock (the "Initial Shares"), at a price of $ 146.60 per share and (ii) Series A Warrants, Series B-1 Warrants, Series B-2 Warrants and Series C Warrants, for aggregate gross proceeds of $ 20.0 million (the "Private Placement").

The Private Placement closed on June 26, 2019 (the "CVI Closing Date").

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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 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, 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.

CVI has the right, in its discretion, to raise this threshold up to 9.99 % with 60 days' notice to the Company.

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 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.

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

The Series A Warrants were exercisable by the holders for a period of five years from the CVI Closing Date and were exercisable into 272,851 shares of Common Stock, which was equal to the Initial Shares plus the number of shares issued pursuant to the exercise of the Series C Warrants (described above), at an adjusted exercise price equal to $ 15.83 .

The Series A Warrants expired on June 26, 2024.

Revolving Credit Agreement

1 unchanged sentence

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 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.

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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 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;

• a minimum Consolidated Fixed Charge Coverage Ratio (as defined in the Revolving Credit Agreement) of not less than 1.25 to 1.0 for the most recently ended four fiscal quarter period, tested as of the last day of each fiscal quarter ending on or after March 31, 2024;

• 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.

The Revolving Credit Agreement is also subject to customary events of default, including a change in control.

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 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 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.

On May 3, 2024, the Company entered into a third 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;

4 unchanged sentences

(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.

(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 June 30, 2024, the Revolving Credit Agreement requires the Company to maintain:

• a minimum Consolidated Asset Coverage Ratio (as defined in the Revolving Credit Agreement) of not less than 2.5 to 1.0, tested as of the last day of each calendar month from and after the calendar month ending May 31, 2024;

• minimum Liquidity (as defined in the Revolving Credit Agreement) of $ 22.0 million, tested as of the last business day of each calendar month from and after the calendar month ending March 31, 2024.

The Revolving Credit Agreement is also subject to customary events of default, including a change in control.

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 Revolving Credit Agreement as of June 30, 2024.

In May 2024, the Company paid $ 6.0 million of the principal amount outstanding under the Revolving Credit Agreement in connection with the 2024 Amendment.

As of June 30, 2024, the Company had outstanding borrowings of $ 10.0 million, and issued and outstanding letters of credit of $ 3.2 million, under the amended Revolving Credit Agreement, with remaining borrowing capacity of $ 11.8 million.

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

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:

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

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

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Total liabilities $ — $ 1,191 $ — $ 1,191 $ — $ 4,806 $ 669 $ 5,475

(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 March 31, 2024 and December 31, 2023.

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

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:

(1) The fair value of this liability as of June 30, 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 June 30, 2024 and December 31, 2023.

(2) The fair value of this liability was derived from a technique which utilized inputs, certain of which were significant and unobservable, that resulted in classification as a Level 3 fair value measurement.

Warrants liability included only the Series A warrants as of December 31, 2023.

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

The Series A Warrants expired on June 26, 2024 and there are no warrants outstanding as of June 30, 2024.

There were no changes to the Company's valuation techniques or methodologies during the three and six months ended June 30, 2024 and 2023.

The following tables present the changes in the Company's recurring Level 3 fair valued instruments for the six months ended June 30, 2024 and 2023, respectively:

(In thousands) Warrants Liability

Balance as of December 31, 2023 $ 669

Total gain recognized due to remeasurement (1)

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.

Total gain recognized due to remeasurement and expiration of warrants (1)

Balance as of June 30, 2024 $ —

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

The Series A warrants expired unexercised on June 26, 2024.

(In thousands) Warrants Liability

1 unchanged sentence

Total loss recognized due to remeasurement (1)

Balance as of March 31, 2023 $ 2,533

Balance as of June 30, 2023 $ 945

(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:

The following table displays the valuation technique and the significant inputs, certain of which were unobservable, for the Company's Level 3 liabilities that existed as of December 31, 2023:

Fair Value Measurements

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

Significant Valuation Technique Significant Valuation Inputs December 31, 2023

Warrants liability Option pricing Stock price $ 16.70

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Risk-free rate 5.3 %

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.

The primary sensitivities in the valuation of the warrants liability were 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 three months ended June 30, 2023, the Company recorded a goodwill impairment charge of $ 44.1 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) March 31, 2024 December 31, 2023

(In thousands) June 30, 2024 December 31, 2023

Accrued data costs $ 16,660 $ 15,529

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Transactions with WPP

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.

As of June 30, 2024 (based on public filings), WPP plc and its affiliates ("WPP") owned 565,968 shares of the Company's outstanding Common Stock, representing 11.6 % 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 Loss, are as follows:

Three Months Ended March 31,

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

(In thousands) 2024 2023 2024 2023

2 unchanged sentences

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

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

(In thousands) June 30, 2024 December 31, 2023

Accounts receivable, net $ 400 $ 525

4 unchanged sentences

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 March 31, 2024, 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 June 30, 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 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.

As of June 30, 2024 (based on public filings), Pine also owned 109,654 shares of the Company's outstanding Common Stock, representing 2.2 % 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.

3 unchanged sentences

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.

On June 27, 2024, each holder of Preferred Stock further waived its right to receive the deferred dividends on or before June 30, 2024.

In addition, each holder waived its right to receive on June 30, 2024 the annual dividends otherwise payable on that date for the dividend period ending June 29, 2024.

As of June 30, 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 June 30, 2024 and December 31, 2023 were $ 32.6 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.

1 unchanged sentence

The Company recognizes expense for the license fees ratably over the term.

On November 6, 2022, the Company and Charter Operating entered into an amendment to the DLA, pursuant to which the Company will receive license fee credits totaling $ 7.0 million.

On November 6, 2022, the Company and Charter Operating entered into an amendment to the DLA, pursuant to which the Company received license fee credits totaling $ 7.0 million.

In June 2023, the Company exchanged correspondence with counsel to Charter Operating regarding Charter Operating's compliance with certain terms of the DLA.

3 unchanged sentences

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,

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

(In thousands) 2024 2023 2024 2023

1 unchanged sentence

Cost of revenues 5,607 4,979 11,213 9,950

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) March 31, 2024 December 31, 2023

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

(In thousands) June 30, 2024 December 31, 2023

Accounts payable $ 13,704 $ 10,323

1 unchanged sentence

Non-current portion of accrued data costs 23,903 21,908

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.

The Company had no transactions with Pine and Liberty for the three and six months ended June 30, 2024 and 2023.

The Company recognized revenues of $ 0.2 million during the three months ended June 30, 2024 and 2023, and $ 0.4 million during the six months ended June 30, 2024 and 2023 from transactions with Qurate and its affiliates in the normal course of business as reflected in the Condensed Consolidated Statements of Operations and Comprehensive Loss.

Organizational Restructuring

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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,

The following table summarizes costs incurred related to the Restructuring Plan for the three and six months ended June 30, 2024 and 2023.

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

(In thousands) 2024 2023 2024 2023

Severance and related costs $ 425 $ 3,773 $ 826 $ 4,661

Other 68 331 127 441

Total restructuring $ 493 $ 4,104 $ 953 $ 5,102

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:

The table below summarizes the balance of restructuring liability as of June 30, 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

3 unchanged sentences

Payments ( 1,720 ) ( 62 ) ( 1,782 )

Foreign exchange 78 — 78

Balance as of March 31, 2024

Other 314 ( 171 ) 143

Balance as of June 30, 2024

$ 944 $ — $ 944

2 unchanged sentences

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:

As of June 30, 2024, the total fixed payment obligations related to set-top box and connected television data agreements are $ 301.8 million and $ 28.2 million, respectively.

The information set forth below summarizes the contractual obligations, by year, as of June 30, 2024:

(In thousands)

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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;

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.

On July 24, 2024, the Company issued 13,257,294 additional shares of Preferred Stock to the existing holders of Preferred Stock in exchange for cancellation of the Company's obligation to pay accrued dividends totaling $ 32.8 million to such holders for annual dividend periods ended in 2023 and 2024.

As of the issuance date, the additional shares of Preferred Stock were convertible into 662,862 shares of the Company's Common Stock, representing an effective conversion price of $ 49.438 per share for the canceled dividend obligation.

The additional shares of Preferred Stock have the same terms and conditions as the Preferred Stock previously issued by the Company, including that holders are entitled to cumulative dividends at a rate of 7.5 % per annum, payable annually in arrears and subject to increase under certain circumstances.

In connection with the issuance, the Company and the holders of Preferred Stock also entered into an amendment to the Stockholders Agreement between the parties.

Among other things, the amendment reduced the $ 100.0 million Special Dividend threshold set forth in the Stockholders Agreement by an amount equal to the liquidation preference of the additional Preferred Stock ($ 32.8 million).

After further reducing the threshold by annual dividends paid in prior years, the current Special Dividend threshold is $ 47.0 million.

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