SCOTTSDALE, Ariz., July 29, 2021 /PRNewswire/ -- Limelight
Networks, Inc. (Nasdaq: LLNW) (Limelight), a leading provider of
edge cloud services, today reported financial results for the
second quarter ended June 30, 2021,
delivering on several key milestones in its 2021 strategic plan,
which resulted in over $3 million of
adjusted EBITDA improvements quarter over quarter.
Highlights of Strategic Plan Progress – Improve, Expand &
Extend to Position for Growth
Under the first full quarter with new leadership, Limelight made
significant strides in a number of key areas to return momentum to
the business, drive operational improvements and accelerate revenue
growth and profitability.
- Achieved a 30% reduction in rebuffer rates and
increased global network throughput by 20% through the newly
formed performance operations team.
- Improved the service level agreement position with 8
of our top 10 clients.
- Achieved a 55% increase in our traffic in Latin America quarter over quarter; expecting
to increase our capacity by 60% in the second half of the year to
support growth in the region.
- Identified over $8 million in
annualized network operations cost savings, which is expected
to contribute $4 million to gross
profit in the second half of the year.
- Key client winback expected to yield over $6 million in annualized revenue. This client
was formerly a top 10 revenue client.
- Appointed Eric Armstrong as
Senior Vice President of Growth. Most recently, Eric was Vice
President, North American Sales and Services at Harmonic, Inc., a
global leader in streaming, broadcast and service provider video
infrastructure.
- Acquired Layer0, a leading provider of SaaS development
and deployment tools for frontend web apps and API's to diversify
product offering, clients and deliver an expected revenue
contribution of over $20 million in
2022, while being accretive to gross margins and adjusted EBITDA.
With the acquisition, Layer0's founder Ajay
Kapur will join Limelight as Chief Technology Officer.
"It has been a very productive quarter and I am pleased with our
ability to manage change while also aggressively executing on the
plans outlined in our last earnings call," said Bob Lyons, President and Chief Executive
Officer. "We were able to make a number of meaningful improvements
in the business that position us well for a strong run-rate exiting
2021. We improved our adjusted EBITDA by over $3 million, as savings from the actions taken in
the first quarter delivered material operational improvements and
most importantly, we see strong early signs of client confidence
returning. Our three-pillar framework of improving, expanding and
extending the core will continue to guide us as we push for
continued momentum in the last half of the year.
"Additionally, I am pleased to welcome both Eric and Ajay to the
executive management team and welcome the entire Layer0 team to
Limelight. I believe the simplified organization and operating
structure we established has allowed us to move more quickly and
efficiently. The addition of Eric, Ajay and the Layer0 team is a
great infusion of diversified experience and talent. The Layer0
team is filled with innovative, results-oriented people and we look
forward to what our new combined organization will accomplish
together," said Lyons.
Second Quarter 2021 Financial Results
- Revenue of $48.3 million, down 6%
compared to $51.2 million in the
first quarter of 2021, and down 17% compared to $58.5 million in the second quarter of 2020.
- GAAP net loss of $13.7 million,
or $(0.11) per basic share, an
improvement of $11.8 million from the
net loss of $25.5 million, or
$(0.21) per basic share, in the first
quarter of 2021. GAAP net loss was $1.7
million, or $(0.01) per basic
share in the second quarter of 2020. GAAP net loss included
$2.2 million and $11.7 million in restructuring and transition
related charges in the second and first quarters of 2021,
respectively.
- Non-GAAP net loss was $8.0
million, or $(0.06) per basic
share, an improvement of $3.0 million
from the net loss of 11.0 million, or (0.09) per basic share, in
the first quarter of 2021. Non-GAAP net income was $3.5 million, or $0.03 per basic share in the second quarter of
2020.
- EBITDA was $(5.3) million, an
improvement of $12.3 million from
$(17.6) million for the first quarter
of 2021. EBITDA was $4.5 million for
the second quarter of 2020.
- Adjusted EBITDA was $0.2 million,
an improvement of $3.5 million from
$(3.3) million for the first quarter
of 2021. Adjusted EBITDA was $9.7
million for the second quarter of 2020.
- Cash and cash equivalents of $119.6
million increased $2.6 million
from $117.0 million at the end of the
first quarter 2021.
- Limelight ended the second quarter of 2021 with 459 employees
and employee equivalents, down from 510 at the end of the first
quarter of 2021, and down from 627 at the end of the second quarter
of 2020.
Based on current outlook, we are reducing the guidance on
capital expenditures from $20-25
million to $15-20 million, but
leaving all other components of our guidance unchanged:
|
|
July
2021
|
|
April
2021
|
|
Actual
2020
|
Revenue
|
|
$220 to $230
million
|
|
$220 to $230
million
|
|
$230.2
million
|
|
|
|
|
|
|
|
GAAP Basic
EPS
|
|
$(0.35) to
$(0.25)
|
|
$(0.35) to
$(0.25)
|
|
$(0.16)
|
|
|
|
|
|
|
|
Non-GAAP
EPS
|
|
$(0.15) to
$(0.05)
|
|
$(0.15) to
$(0.05)
|
|
$(0.01)
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
$20 to $30
million
|
|
$20 to $30
million
|
|
$24.5
million
|
|
|
|
|
|
|
|
Capital
expenditures
|
|
$15 to $20
million
|
|
$20 to $25
million
|
|
$25.1
million
|
"While much has been accomplished in a very short time, we have
more to do," said Lyons. "We will continue our pursuit of
operational excellence, restoring client confidence, improving
performance and returning value to our shareholders." On
August 24, Limelight will provide a
more detailed overview of its go-forward strategy and long-term
business plans. A press release with participation details will be
issued by August 10 and also made
available on the Investor Relations section of Limelight's website
(www.llnw.com).
Financial Tables
LIMELIGHT
NETWORKS, INC.
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(In thousands,
except per share data)
|
|
|
|
|
|
|
|
|
|
June
30,
|
|
March
31,
|
|
December
31,
|
|
|
2021
|
|
2021
|
|
2020
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
ASSETS
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
44,065
|
|
$
35,620
|
|
$
46,795
|
Marketable
securities
|
|
75,471
|
|
81,308
|
|
76,928
|
Accounts
receivable, net
|
|
24,867
|
|
29,151
|
|
31,675
|
Income taxes
receivable
|
|
57
|
|
102
|
|
68
|
Prepaid
expenses and other current assets
|
|
14,557
|
|
14,784
|
|
15,588
|
Total current
assets
|
|
159,017
|
|
160,965
|
|
171,054
|
Property and
equipment, net
|
|
42,406
|
|
46,863
|
|
46,418
|
Operating lease right
of use assets
|
|
8,929
|
|
9,521
|
|
10,150
|
Marketable
securities, less current portion
|
|
40
|
|
40
|
|
40
|
Deferred income
taxes
|
|
1,604
|
|
1,577
|
|
1,530
|
Goodwill
|
|
77,642
|
|
77,421
|
|
77,753
|
Other
assets
|
|
6,147
|
|
6,742
|
|
7,233
|
Total
assets
|
|
$
295,785
|
|
$
303,129
|
|
$
314,178
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Accounts
payable
|
|
$
12,459
|
|
$
8,029
|
|
$
4,587
|
Deferred
revenue
|
|
524
|
|
844
|
|
933
|
Operating
lease liability obligations
|
|
1,977
|
|
2,233
|
|
2,465
|
Income taxes
payable
|
|
388
|
|
322
|
|
253
|
Other current
liabilities
|
|
16,877
|
|
19,264
|
|
17,560
|
Total current
liabilities
|
|
32,225
|
|
30,692
|
|
25,798
|
Convertible senior
notes, net
|
|
121,371
|
|
121,200
|
|
100,945
|
Operating lease
liability obligations, less current portions
|
|
10,358
|
|
10,781
|
|
11,265
|
Deferred income
taxes
|
|
306
|
|
360
|
|
279
|
Deferred revenue,
less current portion
|
|
272
|
|
226
|
|
220
|
Other long-term
liabilities
|
|
369
|
|
476
|
|
479
|
Total
liabilities
|
|
164,901
|
|
163,735
|
|
138,986
|
Commitments and
contingencies
|
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
|
|
Convertible
preferred stock, $0.001 par value; 7,500 shares authorized; no
shares issued and outstanding
|
|
-
|
|
-
|
|
-
|
Common stock,
$0.001 par value; 300,000 shares authorized; 126,705, 125,248 and
123,653 shares issued and
|
|
|
|
|
|
|
outstanding at June 30, 2021, March 31, 2021 and
December 31, 2020, respectively
|
|
127
|
|
125
|
|
124
|
Additional
paid-in capital
|
|
550,205
|
|
545,516
|
|
556,512
|
Accumulated
other comprehensive loss
|
|
(7,965)
|
|
(8,462)
|
|
(7,511)
|
Accumulated
deficit
|
|
(411,483)
|
|
(397,785)
|
|
(373,933)
|
Total stockholders'
equity
|
|
130,884
|
|
139,394
|
|
175,192
|
Total liabilities and
stockholders' equity
|
|
$
295,785
|
|
$
303,129
|
|
$
314,178
|
LIMELIGHT
NETWORKS, INC.
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(In thousands,
except per share data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June
30,
|
|
March
31,
|
|
Percent
|
|
June
30,
|
|
Percent
|
|
June
30,
|
|
June
30,
|
|
Percent
|
|
|
2021
|
|
2021
|
|
Change
|
|
2020
|
|
Change
|
|
2021
|
|
2020
|
|
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
48,348
|
|
$
51,195
|
|
-6%
|
|
$
58,546
|
|
-17%
|
|
$
99,543
|
|
$
115,558
|
|
-14%
|
Cost of
revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
services (1)
|
|
32,976
|
|
33,021
|
|
0%
|
|
29,389
|
|
12%
|
|
66,021
|
|
60,502
|
|
9%
|
Depreciation -
network
|
|
5,929
|
|
5,679
|
|
4%
|
|
5,360
|
|
11%
|
|
11,608
|
|
10,510
|
|
10%
|
Total cost of
revenue
|
|
38,905
|
|
38,700
|
|
1%
|
|
34,749
|
|
12%
|
|
77,629
|
|
71,012
|
|
9%
|
Gross
profit
|
|
9,443
|
|
12,495
|
|
-24%
|
|
23,797
|
|
-60%
|
|
21,914
|
|
44,546
|
|
-51%
|
Gross profit
percentage
|
|
19.5%
|
|
24.4%
|
|
|
|
40.6%
|
|
|
|
22.0%
|
|
38.5%
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General and
administrative (1)
|
|
7,515
|
|
12,948
|
|
-42%
|
|
8,187
|
|
-8%
|
|
20,412
|
|
16,069
|
|
27%
|
Sales and
marketing (1)
|
|
5,784
|
|
9,835
|
|
-41%
|
|
10,929
|
|
-47%
|
|
15,631
|
|
22,823
|
|
-32%
|
Research &
development (1)
|
|
5,187
|
|
6,113
|
|
-15%
|
|
5,572
|
|
-7%
|
|
11,315
|
|
11,189
|
|
1%
|
Depreciation
and amortization
|
|
549
|
|
540
|
|
2%
|
|
323
|
|
70%
|
|
1,089
|
|
665
|
|
64%
|
Restructuring
charges
|
|
2,155
|
|
6,873
|
|
NM
|
|
-
|
|
NM
|
|
9,028
|
|
-
|
|
NM
|
Total operating
expenses
|
|
21,190
|
|
36,309
|
|
-42%
|
|
25,011
|
|
-15%
|
|
57,475
|
|
50,746
|
|
13%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
loss
|
|
(11,747)
|
|
(23,814)
|
|
NM
|
|
(1,214)
|
|
NM
|
|
(35,561)
|
|
(6,200)
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
(1,305)
|
|
(1,286)
|
|
NM
|
|
(71)
|
|
NM
|
|
(2,591)
|
|
(82)
|
|
NM
|
Interest
income
|
|
42
|
|
45
|
|
NM
|
|
6
|
|
NM
|
|
87
|
|
31
|
|
NM
|
Other,
net
|
|
(440)
|
|
(214)
|
|
NM
|
|
(312)
|
|
NM
|
|
(655)
|
|
(421)
|
|
NM
|
Total other
expense
|
|
(1,703)
|
|
(1,455)
|
|
NM
|
|
(377)
|
|
NM
|
|
(3,159)
|
|
(472)
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss before income
taxes
|
|
(13,450)
|
|
(25,269)
|
|
NM
|
|
(1,591)
|
|
NM
|
|
(38,720)
|
|
(6,672)
|
|
NM
|
Income tax
expense
|
|
248
|
|
260
|
|
NM
|
|
136
|
|
NM
|
|
507
|
|
311
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
(13,698)
|
|
$
(25,529)
|
|
NM
|
|
$
(1,727)
|
|
NM
|
|
$
(39,227)
|
|
$
(6,983)
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
(0.11)
|
|
$
(0.21)
|
|
|
|
$
(0.01)
|
|
|
|
$
(0.31)
|
|
$
(0.06)
|
|
|
Diluted
|
|
$
(0.11)
|
|
$
(0.21)
|
|
|
|
$
(0.01)
|
|
|
|
$
(0.31)
|
|
$
(0.06)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares used in per share calculation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
126,050
|
|
124,290
|
|
|
|
120,230
|
|
|
|
125,170
|
|
119,597
|
|
|
Diluted
|
|
126,050
|
|
124,290
|
|
|
|
120,230
|
|
|
|
125,170
|
|
119,597
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Includes
share-based compensation (see supplemental table for
figures)
|
|
|
|
|
|
|
LIMELIGHT
NETWORKS, INC.
|
SUPPLEMENTAL
FINANCIAL DATA
|
(In
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June
30,
|
|
March
31,
|
|
June
30,
|
|
June
30,
|
|
June
30,
|
|
|
2021
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
|
|
|
|
|
|
|
|
|
|
Share-based
compensation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
services
|
|
$
458
|
|
$
246
|
|
$
792
|
|
$
704
|
|
$
1,555
|
General and
administrative
|
|
1,874
|
|
6,028
|
|
2,257
|
|
7,902
|
|
4,498
|
Sales and
marketing
|
|
395
|
|
563
|
|
1,322
|
|
958
|
|
2,550
|
Research and
development
|
|
614
|
|
371
|
|
880
|
|
985
|
|
1,712
|
Restructuring and
transition related charges
|
|
917
|
|
1,354
|
|
-
|
|
2,271
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
Total share-based
compensation
|
|
$
4,258
|
|
$
8,562
|
|
$
5,251
|
|
$
12,820
|
|
$
10,315
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Network-related
depreciation
|
|
$
5,929
|
|
$
5,679
|
|
$
5,360
|
|
$
11,608
|
|
$
10,510
|
Other depreciation
and amortization
|
|
549
|
|
540
|
|
323
|
|
1,089
|
|
665
|
|
|
|
|
|
|
|
|
|
|
|
Total depreciation
and amortization
|
|
$
6,478
|
|
$
6,219
|
|
$
5,683
|
|
$
12,697
|
|
$
11,175
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net increase
(decrease) in cash, cash equivalents and marketable
securities:
|
|
$
2,608
|
|
$
(6,795)
|
|
$
(3,221)
|
|
$
(4,187)
|
|
$
(135)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
End of period
statistics:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Approximate number of
active clients
|
|
533
|
|
527
|
|
560
|
|
533
|
|
560
|
|
|
|
|
|
|
|
|
|
|
|
Number of employees
and employee equivalents
|
|
459
|
|
510
|
|
627
|
|
459
|
|
627
|
LIMELIGHT
NETWORKS, INC.
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(In
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June
30,
|
|
March
31,
|
|
June
30,
|
|
June
30,
|
|
June
30,
|
|
|
|
|
2021
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
activities
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
(13,698)
|
|
$
(25,529)
|
|
$
(1,727)
|
|
$
(39,227)
|
|
$
(6,983)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments to
reconcile net income (loss) to net cash provided by (used in)
operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
6,478
|
|
6,219
|
|
5,683
|
|
12,697
|
|
11,175
|
|
|
Share-based
compensation
|
|
4,258
|
|
8,562
|
|
5,251
|
|
12,820
|
|
10,315
|
|
|
Foreign currency
remeasurement loss (gain)
|
|
257
|
|
(71)
|
|
257
|
|
186
|
|
(140)
|
|
|
Deferred income
taxes
|
|
(71)
|
|
(10)
|
|
59
|
|
(81)
|
|
15
|
|
|
Gain on sale of
property and equipment
|
|
(107)
|
|
-
|
|
-
|
|
(107)
|
|
-
|
|
|
Accounts receivable
charges
|
|
381
|
|
466
|
|
155
|
|
847
|
|
313
|
|
|
Amortization of
premium on marketable securities
|
|
573
|
|
609
|
|
-
|
|
1,182
|
|
-
|
|
|
Non-cash interest
expense
|
|
201
|
|
199
|
|
-
|
|
400
|
|
-
|
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
3,903
|
|
2,059
|
|
(10,798)
|
|
5,962
|
|
(11,083)
|
|
|
Prepaid
expenses and other current assets
|
|
(7)
|
|
446
|
|
986
|
|
439
|
|
(447)
|
|
|
Income taxes
receivable
|
|
46
|
|
(36)
|
|
10
|
|
10
|
|
13
|
|
|
Other
assets
|
|
513
|
|
399
|
|
1,121
|
|
912
|
|
1,747
|
|
|
Accounts
payable and other current liabilities
|
|
1,523
|
|
5,209
|
|
1,045
|
|
6,732
|
|
6,937
|
|
|
Deferred
revenue
|
|
(273)
|
|
(84)
|
|
313
|
|
(357)
|
|
63
|
|
|
Income taxes
payable
|
|
68
|
|
73
|
|
-
|
|
141
|
|
2
|
|
|
Other long
term liabilities
|
|
(108)
|
|
(3)
|
|
(15)
|
|
(111)
|
|
(11)
|
|
Net cash provided by
(used in) operating activities
|
|
3,937
|
|
(1,492)
|
|
2,340
|
|
2,445
|
|
11,916
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investing
activities
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchases of
marketable securities
|
|
(20,537)
|
|
(10,874)
|
|
-
|
|
(31,411)
|
|
-
|
|
|
Sale and maturities
of marketable securities
|
|
25,818
|
|
5,897
|
|
-
|
|
31,715
|
|
-
|
|
|
Purchases of property
and equipment
|
|
(2,986)
|
|
(6,628)
|
|
(8,085)
|
|
(9,614)
|
|
(14,948)
|
|
|
Proceeds from sale of
property and equipment
|
|
107
|
|
-
|
|
-
|
|
107
|
|
-
|
|
Net cash provided by
(used in) investing activities
|
|
2,402
|
|
(11,605)
|
|
(8,085)
|
|
(9,203)
|
|
(14,948)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financing
activities
|
|
|
|
|
|
|
|
|
|
|
|
|
Payment of debt
issuance costs
|
|
(30)
|
|
-
|
|
-
|
|
(30)
|
|
-
|
|
|
Payment of employee
tax withholdings related to restricted stock vesting
|
|
(427)
|
|
(671)
|
|
(1,430)
|
|
(1,098)
|
|
(2,945)
|
|
|
Proceeds from
employee stock plans
|
|
2,613
|
|
2,847
|
|
3,954
|
|
5,460
|
|
6,092
|
|
Net cash provided by
financing activities
|
|
2,156
|
|
2,176
|
|
2,524
|
|
4,332
|
|
3,147
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
|
(50)
|
|
(254)
|
|
-
|
|
(304)
|
|
(250)
|
Net increase
(decrease) in cash and cash equivalents
|
|
8,445
|
|
(11,175)
|
|
(3,221)
|
|
(2,730)
|
|
(135)
|
Cash and cash
equivalents, beginning of period
|
|
35,620
|
|
46,795
|
|
21,421
|
|
46,795
|
|
18,335
|
Cash and cash
equivalents, end of period
|
|
$
44,065
|
|
$
35,620
|
|
$
18,200
|
|
$
44,065
|
|
$
18,200
|
Use of Non-GAAP Financial Measures
To evaluate our business, we consider and use non-generally
accepted accounting principles (Non-GAAP) net income (loss), EBITDA
and Adjusted EBITDA as supplemental measures of operating
performance. These measures include the same adjustments that
management takes into account when it reviews and assesses
operating performance on a period-to-period basis. We consider
Non-GAAP net income (loss) to be an important indicator of overall
business performance. We define Non-GAAP net income (loss) to be
U.S. GAAP net income (loss) adjusted to exclude share-based
compensation, non-cash interest expense and restructuring and
transition related charges. We believe that EBITDA provides a
useful metric to investors to compare us with other companies
within our industry and across industries. We define EBITDA as U.S.
GAAP net income (loss) adjusted to exclude depreciation and
amortization, interest expense, interest and other (income)
expense, and income tax expense. We define Adjusted EBITDA as
EBITDA adjusted to exclude share-based compensation and
restructuring and transition related charges. We use Adjusted
EBITDA as a supplemental measure to review and assess operating
performance. Our management uses these Non-GAAP financial measures
because, collectively, they provide valuable information on the
performance of our on-going operations, excluding non-cash charges,
taxes and non-core activities (including interest payments related
to financing activities). These measures also enable our management
to compare the results of our on-going operations from period to
period, and allow management to review the performance of our
on-going operations against our peer companies and against other
companies in our industry and adjacent industries. We believe these
measures also provide similar insights to investors and enable
investors to review our results of operations "through the eyes of
management."
Furthermore, our management uses these Non-GAAP financial
measures to assist them in making decisions regarding our strategic
priorities and areas for future investment and focus.
The terms Non-GAAP net income (loss), EBITDA and Adjusted EBITDA
are not defined under U.S. GAAP, and are not measures of operating
income, operating performance or liquidity presented in accordance
with U.S. GAAP. Our Non-GAAP net income (loss), EBITDA and Adjusted
EBITDA have limitations as analytical tools, and when assessing our
operating performance, Non-GAAP net income (loss), EBITDA and
Adjusted EBITDA should not be considered in isolation, or as a
substitute for net income (loss) or other consolidated income
statement data prepared in accordance with U.S. GAAP. Some of these
limitations include, but are not limited to:
- EBITDA and Adjusted EBITDA do not reflect our cash expenditures
or future requirements for capital expenditures or contractual
commitments;
- These measures do not reflect changes in, or cash requirements
for, our working capital needs;
- Non-GAAP net income (loss) and Adjusted EBITDA do not reflect
the cash requirements necessary for litigation costs, including
provision for litigation and litigation expenses;
- These measures do not reflect the interest expense, or the cash
requirements necessary to service interest or principal payments,
on our debt that we may incur;
- These measures do not reflect income taxes or the cash
requirements for any tax payments;
- Although depreciation and amortization are non-cash charges,
the assets being depreciated and amortized will be replaced
sometime in the future, and EBITDA and Adjusted EBITDA do not
reflect any cash requirements for such replacements;
- While share-based compensation is a component of operating
expense, the impact on our financial statements compared to other
companies can vary significantly due to such factors as the assumed
life of the options and the assumed volatility of our common stock;
and
- Other companies may calculate Non-GAAP net income (loss),
EBITDA and Adjusted EBITDA differently than we do, limiting their
usefulness as comparative measures.
We compensate for these limitations by relying primarily on our
U.S. GAAP results and using Non-GAAP net income (loss), EBITDA, and
Adjusted EBITDA only as supplemental support for management's
analysis of business performance. Non-GAAP net income (loss),
EBITDA and Adjusted EBITDA are calculated as follows for the
periods presented in thousands:
Reconciliation of Non-GAAP Financial Measures
In accordance with the requirements of Item 10(e) of Regulation
S-K, we are presenting the most directly comparable U.S. GAAP
financial measures and reconciling the unaudited Non-GAAP financial
metrics to the comparable U.S. GAAP measures. Per share amounts may
not foot due to rounding.
LIMELIGHT
NETWORKS, INC.
|
Reconciliation of
U.S. GAAP Net Loss to Non-GAAP Net Income (Loss)
|
(In
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
2021
|
|
March 31,
2021
|
|
June 30,
2020
|
|
June 30,
2021
|
|
June 30,
2020
|
|
|
Amount
|
|
Per
Share
|
|
Amount
|
|
Per
Share
|
|
Amount
|
|
Per
Share
|
|
Amount
|
|
Per
Share
|
|
Amount
|
|
Per
Share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. GAAP net
loss
|
|
$
(13,698)
|
|
$
(0.11)
|
|
$
(25,529)
|
|
$
(0.21)
|
|
$
(1,727)
|
|
$
(0.01)
|
|
$
(39,227)
|
|
$
(0.31)
|
|
$
(6,983)
|
|
$
(0.06)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share-based
compensation
|
|
3,341
|
|
0.03
|
|
2,644
|
|
0.02
|
|
5,251
|
|
0.04
|
|
5,985
|
|
0.05
|
|
10,315
|
|
0.09
|
Non-cash interest
expense
|
|
201
|
|
0.00
|
|
199
|
|
0.00
|
|
-
|
|
-
|
|
400
|
|
0.00
|
|
-
|
|
-
|
Restructuring and
transition related charges
|
|
2,155
|
|
0.02
|
|
11,700
|
|
0.09
|
|
-
|
|
-
|
|
13,855
|
|
0.11
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net (loss)
income
|
|
$
(8,001)
|
|
$
(0.06)
|
|
$
(10,986)
|
|
$
(0.09)
|
|
$
3,524
|
|
$
0.03
|
|
$
(18,987)
|
|
$
(0.15)
|
|
$
3,332
|
|
$
0.03
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
basic shares used in per share calculation
|
|
|
|
126,050
|
|
|
|
124,290
|
|
|
|
120,230
|
|
|
|
125,170
|
|
|
|
119,597
|
LIMELIGHT
NETWORKS, INC.
|
Reconciliation of
U.S. GAAP Net Loss to EBITDA to Adjusted EBITDA
|
(In
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June
30,
|
|
March
31,
|
|
June
30,
|
|
June
30,
|
|
June
30,
|
|
|
|
2021
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. GAAP net
loss
|
|
$
(13,698)
|
|
$
(25,529)
|
|
$
(1,727)
|
|
$
(39,227)
|
|
$
(6,983)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
6,478
|
|
6,219
|
|
5,683
|
|
12,697
|
|
11,175
|
|
Interest
expense
|
|
1,305
|
|
1,286
|
|
71
|
|
2,591
|
|
82
|
|
Interest and other
(income) expense
|
|
398
|
|
169
|
|
306
|
|
568
|
|
390
|
|
Income tax
expense
|
|
248
|
|
260
|
|
136
|
|
507
|
|
311
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
$
(5,269)
|
|
$
(17,595)
|
|
$
4,469
|
|
$
(22,864)
|
|
$
4,975
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share-based
compensation
|
|
3,341
|
|
2,644
|
|
5,251
|
|
5,985
|
|
10,315
|
|
Restructuring and
transition related charges
|
|
2,155
|
|
11,700
|
|
-
|
|
13,855
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
$
227
|
|
$
(3,251)
|
|
$
9,720
|
|
$
(3,024)
|
|
$
15,290
|
For future periods, we are unable to provide a reconciliation of
EBITDA and Adjusted EBITDA to net income (loss) as a result of the
uncertainty regarding, and the potential variability of, the
amounts of depreciation and amortization, interest expense,
interest and other (income) expense and income tax expense, that
may be incurred in the future.
Conference Call
At approximately 4:30 p.m. EDT
(1:30 p.m. PDT) today, management
will host a quarterly conference call for investors. Investors can
access this call toll-free at 877-296-5190 within the United States or +1 412-317-5233 outside
of the U.S. The conference call will also be audio cast live from
http://www.limelight.com and a replay will be available
following the call from the Limelight website.
Forward-Looking Statements
This press release contains forward-looking statements that
involve risks and uncertainties. These statements include, among
others, statements regarding our expectations regarding revenue,
gross margin, non-GAAP net income (loss), capital expenditures, and
our future prospects. Our expectations and beliefs regarding these
matters may not materialize. The potential risks and uncertainties
that could cause actual results or outcomes to differ materially
from the results or outcomes predicted include, among other things,
reduction of demand for our services from new or existing clients,
unforeseen changes in our hiring patterns, adverse outcomes in
litigation, experiencing expenses that exceed our expectations, and
acquisition activities and contributions from acquired businesses.
A detailed discussion of these factors and other risks that affect
our business is contained in our SEC filings, including our most
recent reports on Forms 10-K and 10-Q, particularly under the
heading "Risk Factors." Copies of these filings are available
online on our investor relations website at
investors.limelightnetworks.com and on the SEC website at
www.SEC.gov. All information provided in this release and in the
attachments is as of July 29, 2021,
and we undertake no duty to update this information in light of new
information or future events, unless required by law.
About Limelight
Limelight Networks, Inc. (NASDAQ: LLNW) is an industry-leader in
edge access and content delivery services that provides powerful
tools and a client-first approach to optimize and deliver digital
experiences at the edge. We are a trusted partner to the world's
biggest brands and serve their global customers with experiences
such as livestream sporting events, global movie launches, video
games or file downloads for new phone apps. Limelight offers one of
the largest, best-optimized private networks coupled with a global
team of industry experts to provide edge services that are fast,
secure and reliable. For more information,
visit www.limelight.com, and follow us on Twitter,
Facebook and LinkedIn.
Copyright (C) 2021 Limelight Networks, Inc. All rights reserved.
All product or service names are the property of their respective
owners.
Source: Limelight Networks
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SOURCE Limelight Networks