Marchex, Inc. (NASDAQ:MCHX)(NASDAQ:MCHXP), a local online
advertising company and leading publisher of local content, today
reported its results for the fourth quarter of 2007 and full year
ended December 31, 2007. Fourth Quarter 2007 Consolidated Financial
Results: Revenue was $37.0 million for the fourth quarter of 2007,
compared to $32.6 million for the same period of 2006. GAAP net
loss applicable to common stockholders was $774,000 for the fourth
quarter of 2007 or $0.02 loss per diluted share. This compares to
GAAP net income applicable to common stockholders of $5.0 million
or $0.01 loss per diluted share for the same period of 2006. The
GAAP diluted EPS calculation in 2006 excludes the effect of the
non-cash non-recurring discount on preferred stock redemption of
$5.8 million, net of dividends on the redeemed preferred shares of
$197,000. The fourth quarter 2007 results included non-cash
stock-based compensation expense recorded under the fair value
method of $2.1 million, compared to non-cash stock-based
compensation expense of $2.6 million for the same period in 2006.
We provide a reconciliation of GAAP diluted EPS to Adjusted
Non-GAAP EPS in the financial tables attached to this press release
and encourage investors to examine the reconciling adjustments
between the GAAP and non-GAAP measures. Adjusted non-GAAP EPS for
the fourth quarter of 2007 was $0.08, compared to $0.13 for the
same period of 2006. Some Wall Street analysts use non-GAAP
measures to analyze our operating results, which may include
adjusted non-GAAP EPS, adjusted operating income before
amortization and adjusted EBITDA. We present GAAP measures with
equal or greater prominence than non-GAAP measures and such
non-GAAP measures should not be considered a substitute for, or
superior to, GAAP results. Adjusted operating income before
amortization was $5.3 million for the fourth quarter of 2007,
compared to $8.3 million for the same period of 2006. A
reconciliation of non-GAAP adjusted operating income before
amortization to GAAP operating income and GAAP net income is
included in the financial tables attached to this release. Adjusted
EBITDA was $7.9 million in the fourth quarter of 2007, compared to
$10.0 million for the same period of 2006. A reconciliation of
operating income before taxes, depreciation, amortization and
gain/loss on sales of intangible assets to GAAP net cash provided
by operating activities is included in the financial tables
attached to this release. Full Year 2007 Results: Revenue for the
year ended December 31, 2007 was $139.4 million, compared to $127.8
million for 2006. GAAP net loss applicable to common stockholders
was $1.4 million or $0.04 loss per diluted share for 2007. This
compares to GAAP net income applicable to common stockholders of
$2.8 million or $0.04 loss per diluted share for the same period of
2006. The GAAP diluted EPS calculation in 2006 excludes the effect
of the non-cash non-recurring discount on preferred stock
redemption of $5.8 million, net of dividends on the redeemed
preferred shares of $197,000. As discussed in the summary of the
fourth quarter 2007 consolidated financial results, we provide a
reconciliation of GAAP diluted EPS to Adjusted Non-GAAP EPS in the
financial tables attached to this press release and encourage
investors to examine the reconciling adjustments between the GAAP
and non-GAAP measures. Adjusted non-GAAP EPS for 2007 was $0.36,
compared to $0.47 for 2006. Adjusted operating income before
amortization was $24.0 million for 2007, compared to $33.4 million
2006. A reconciliation of non-GAAP adjusted operating income before
amortization to GAAP operating income and GAAP net income is
included in the financial tables attached to this release. Adjusted
EBITDA was $33.3 million for 2007, compared to $39.5 million for
2006. A reconciliation of operating income before taxes,
depreciation, amortization and gain/loss on sales of intangible
assets to GAAP net cash provided by operating activities is
included in the financial tables attached to this release.
�Marchex�s focus on the local online opportunity led to our
positive performance in the fourth quarter and increased momentum
in our business,� said Russell C. Horowitz, Marchex Chairman and
CEO. �Marchex is achieving leadership in local through two means:
first, by building and delivering the most local-centric
advertising platform in the industry, supporting clicks and calls;
and, second, by delivering unparalleled utility and relevance to
local consumers through our network of proprietary local Web sites.
Our success in each of these areas is already leading Marchex to a
point of scale that few companies in the local online industry
possess, and is positioning us to capture increased market share
and see accelerating growth.� Operating Highlights: Local
Advertiser Growth: In the fourth quarter, Marchex added more than
5,000 new advertisers through its aggregator partnerships and
direct sales channel. Marchex now has more than 55,000 advertisers
using its products and services and, based on current growth rates,
anticipates it will have more than 80,000 advertisers using its
products and services by the end of 2009. Local Advertising
Services: For the fourth quarter of 2007, revenue from local
advertising services was $25.6 million compared to $19.5 million in
2006. One of the primary factors driving growth for the quarter was
the continued increase in the number of new advertisers using
Marchex products and services. Local Content Network (proprietary
traffic sources): Marchex�s Local Content Network is comprised of
two areas: (1) Local Reference Web sites, and (2) community content
and features. Local Reference Web sites are those sites within
Marchex�s network that help consumers find local businesses and
services, and include sites such as www.OpenList.com,
www.Yellow.com, and www.ChicagoDoctors.com. For the fourth quarter
of 2007, revenue from proprietary traffic sources was $11.4
million. Additionally, Marchex attracted more than 26 million
unique visitors for the month of December 2007 and delivered more
than 50 million revenue-generating events and referrals in the
fourth quarter. Unique visitor statistics are based on internal
traffic logs, which calculate unique IP (Internet protocol)
addresses on an unduplicated basis during a given month. Stock
Repurchase Program: Marchex today announced that it�is revising its
stock repurchase program to increase the amount of shares available
for purchase�to up to a total of 5 million shares from 3 million
shares previously authorized, less shares repurchased to date.
During the fourth quarter of 2007, Marchex purchased 770,000 shares
of its outstanding Class B common stock for a total price of $8.5
million, bringing its total shares repurchased in 2007 to 2.2
million shares, or 5% of its outstanding common stock. Under the
revised program, an additional 2.8 million shares remain available
for repurchase. Marchex Financial Guidance: The following
forward-looking statements reflect Marchex's expectations as of
February 14, 2008: Guidance for fiscal year 2008 (Year ending
December 31, 2008): Revenue estimate: � More than $150 million �
Adjusted operating income before amortization estimate: More than
$21 million Adjusted EBITDA: For adjusted EBITDA, Marchex
anticipates add-backs of approximately $9 million in additional
depreciation and amortization to its adjusted operating income
before amortization range, implying an adjusted EBITDA of more than
$30 million for 2008. Guidance for first quarter 2008: Revenue
estimate: � More than $35.5 million � Adjusted operating income
before amortization estimate: More than $4.5 million Adjusted
EBITDA: For adjusted EBITDA, Marchex anticipates add-backs of
approximately $2.3 million in additional depreciation and
amortization to its adjusted operating income before amortization
range, implying an adjusted EBITDA of more than $6.8 million for
the first quarter of 2008. For color on guidance for the first
quarter of 2008, while Marchex anticipates continued momentum in
its Local Advertising Services business, the company does expect a
seasonal impact from advertisers lowering their budgets relative to
the seasonally high fourth quarter. Additionally, Marchex expects
revenue from proprietary traffic sources to be in a similar range
to or slightly better than the fourth quarter of 2007. This is
based on anticipated increases in consumer usage on Marchex�s Local
Content Network and increased amounts from third parties, with
certain offsets from the company�s ongoing efforts to increase
direct sales of advertising inventory and lower sales and marketing
expenses on a year-over-year basis. Conference Call and Webcast
Information: Management will hold a conference call, starting at
5:00 p.m. EDT on Thursday, February 14, 2008 to discuss its fourth
quarter and year ended December 31, 2007 financial results and
other company updates. To access the call by live Webcast, please
log onto the Investor Relations section of the Marchex Web site
(www.marchex.com/investors). An archived version of the Webcast
will also be available, beginning two hours after completion of the
call, at the same location. About Marchex, Inc. Marchex
(www.marchex.com) is a local online advertising company and leading
publisher of local content. Marchex's innovative advertising
platform delivers search- and call-based marketing products and
services for local and national advertisers. Marchex's local
content network, one of the largest online, helps consumers make
better, more informed local decisions through its network of
content-rich Web sites that reach tens of millions of unique
visitors each month. Forward-Looking Statements: This press release
contains forward-looking statements that involve substantial risks
and uncertainties. All statements, other than statements of
historical facts, included in this press release regarding our
strategy, future operations, future financial position, future
revenues, acquisitions, projected costs, prospects, plans and
objectives of management are forward-looking statements. We may not
actually achieve the plans, intentions or expectations disclosed in
our forward-looking statements and you should not place undue
reliance on our forward-looking statements. Actual results or
events could differ materially from the plans, intentions and
expectations disclosed in the forward-looking statements we make.
There are a number of important factors that could cause Marchex's
actual results to differ materially from those indicated by such
forward-looking statements which are described in the "Risk
Factors" section of our most recent periodic report and
registration statement filed with the SEC. All of the information
provided in this release is as of February 14, 2008 and Marchex
undertakes no duty to update the information provided herein.
Non-GAAP Financial Information: To supplement Marchex's
consolidated financial statements presented in accordance with GAAP
and to provide clarity internally and externally, Marchex uses
certain non-GAAP measures of financial performance and liquidity,
including OIBA, Adjusted OIBA, Adjusted EBITDA and Adjusted
non-GAAP EPS. Marchex also provides Pro Forma Revenue information
for the three months and years ended December 31, 2006 and 2007 as
if the AreaConnect and Open List asset acquisitions in 2006 and the
VoiceStar acquisition in 2007 occurred as of January 1, 2006, and
the VoiceStar acquisition in 2007 occurred as of January 1, 2007.
OIBA represents income (loss) from operations plus (1) stock-based
compensation expense and (2) amortization of acquired intangible
assets. This measure, among other things, is one of the primary
metrics by which Marchex evaluates the performance of its business.
Additionally, Marchex's management uses Adjusted OIBA which
excludes (1) any gain/loss on sales and disposals of intangible
assets and (2) facility relocation as these are viewed as
non-recurring in nature. Adjusted OIBA is the basis on which
Marchex's internal budgets are based and by which Marchex's
management is currently evaluated. Marchex believes these measures
are useful to investors because they represent Marchex's
consolidated operating results, taking into account depreciation
and other intangible amortization, which Marchex believes is an
ongoing cost of doing business, but excluding the effects of
certain other non-cash and non-recurring expenses. Adjusted EBITDA
represents income before interest, income taxes, depreciation,
amortization, stock compensation expense, and gain/loss on sales of
intangible assets. Marchex believes that Adjusted EBITDA is another
alternative measure of liquidity to GAAP net cash provided by
operating activities that provides meaningful supplemental
information regarding liquidity and is used by Marchex's management
to measure its ability to fund operations and its financing
obligations. Adjusted non-GAAP EPS represents Adjusted Net Income
divided by weighted average fully diluted shares outstanding for
Adjusted non-GAAP EPS purposes. Adjusted Net Income generally
captures those items on the statement of operations that have been,
or ultimately will be, settled in cash exclusive of certain
non-recurring items and represents net income (loss) available to
common stockholders plus: (1) stock based compensation expense, (2)
amortization of acquired intangible assets, (3) gain/loss on sales
and disposals of intangible assets, (4) other income (expense), (5)
the cumulative effect of changes in accounting principles, (6)
facility relocation and less (7) discount on preferred stock
redemption. Adjusted non-GAAP EPS includes dilution from options
and warrants per the treasury stock method, includes the weighted
average number of all potential common shares relating to
convertible preferred stock and restricted stock and excludes the
weighted average common share equivalents for redeemed preferred
shares. Shares outstanding for Adjusted non-GAAP EPS purposes are
therefore higher than shares outstanding for GAAP EPS purposes.
Financial analysts and investors may use Adjusted non-GAAP EPS to
analyze Marchex's financial performance since these groups have
historically used EPS related measures, along with other measures,
to estimate the value of a company, to make informed investment
decisions and to evaluate a company's operating performance
compared to that of other companies in its industry. Marchex's
management believes that investors should have access to, and
Marchex is obligated to provide, the same set of tools that
management uses in analyzing the company's results. These non-GAAP
measures should be considered in addition to results prepared in
accordance with GAAP, and should not be considered in isolation, as
a substitute for, or superior to, GAAP results. These non-GAAP
terms, as defined by Marchex, may not be comparable to similarly
titled measures used by other companies. Marchex endeavors to
compensate for the limitations of the non-GAAP measures presented
by providing the comparable GAAP measure with equal or greater
prominence, GAAP financial statements and detailed descriptions of
the reconciling items and adjustments, including quantifying such
items, to derive the non-GAAP measure. MARCHEX, INC. AND
SUBSIDIARIES Condensed Consolidated Statements of Operations
(unaudited) � � Three Months Ended December 31, � 2006 � � 2007 � �
Revenue $ 32,606,314 � $ 37,008,033 � � Expenses: Service costs (1)
15,377,218 20,079,692 Sales and marketing (1) 5,814,305 5,311,134
Product development (1) 2,624,636 3,454,849 General and
administrative (1) 3,168,286 4,986,514 Amortization of intangible
assets from acquisitions � 5,121,162 � � 4,325,618 � Total
operating expenses � 32,105,607 � � 38,157,807 � � Gain on sales
and disposals of intangible assets, net � 85,194 � � 997 � � Income
(loss) from operations 585,901 (1,148,777 ) � Interest income and
other, net � 835,992 � � 370,827 � � Income (loss) before provision
for income taxes 1,421,893 (777,950 ) � Income tax expense
(benefit) � 1,984,954 � � (21,676 ) � Net loss (563,061 ) (756,274
) � Convertible preferred stock dividends and discount on preferred
stock redemption � (5,535,570 ) � 17,891 � � Net income (loss)
applicable to common stockholders $ 4,972,509 � $ (774,165 ) �
Basic net income (loss) applicable to common stockholders $ 0.13 $
(0.02 ) Diluted net loss applicable to common stock holders $ (0.01
) (2) $ (0.02 ) � Shares used to calculate basic net income (loss)
per share applicable to common stockholders 38,845,086 37,735,790
Shares used to calculate diluted net loss per share applicable to
common stockholders 39,745,623 (2) 37,735,790 � (1) Includes
stock-based compensation allocated as follows: Service costs $
417,166 $ (16,737 ) Sales and marketing 160,102 (271,161 ) Product
development 831,983 189,863 General and administrative � 1,224,911
� � 2,191,320 � Total $ 2,634,162 � $ 2,093,285 � � (2) Calculation
of the 2006 diluted net loss per share applicable to common
stockholders excludes the effect of the discount on preferred stock
redemption of $5.8 million, net of dividends on the redeemed
preferred shares of $197,000. The shares used to calculate the 2006
diluted net loss per share applicable to common stockholders
includes the weighted average common share equivalents for the
redeemed preferred shares. � � MARCHEX, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations (unaudited) � �
Year Ended December 31, � 2006 � � 2007 � � Revenue $ 127,759,475 �
$ 139,390,659 � � Expenses: Service costs (1) 60,433,611 70,901,141
Sales and marketing (1) 23,050,654 24,962,682 Product development
(1) 10,094,967 12,018,010 General and administrative (1) 13,533,215
17,777,790 Amortization of intangible assets from acquisitions
20,465,128 16,930,348 Facility relocation � - � � 121,124 � Total
operating expenses � 127,577,575 � � 142,711,095 � � Gain on sales
and disposals of intangible assets, net � 369,960 � � 283,076 � �
Loss from operations 551,860 (3,037,360 ) � Interest income and
other, net � 3,143,363 � � 2,492,493 � � Income (loss) before
provision for income taxes 3,695,223 (544,867 ) � Income tax
expense � 4,290,201 � � 960,401 � � Loss before cumulative effect
of a change in accounting principle (594,978 ) (1,505,268 ) �
Cumulative effect of a change in accounting principle, net of tax
(2) � 151,341 � � - � � Net loss (443,637 ) (1,505,268 ) �
Convertible preferred stock dividends, conversion payment and
discount on preferred stock redemption, net � (3,197,341 ) �
(95,148 ) � Net income (loss) applicable to common stockholders $
2,753,704 � $ (1,410,120 ) � Basic net income (loss) per share
applicable to common stockholders $ 0.07 $ (0.04 ) Diluted net loss
per share applicable to common stockholders $ (0.04 ) (3) $ (0.04 )
� Basic net income (loss) applicable to common stockholders
38,261,884 38,937,697 Diluted net loss applicable to common stock
holders 39,500,123 (3) 38,937,697 � (1) Includes stock-based
compensation allocated as follows: Service costs $ 1,177,773 $
285,329 Sales and marketing 2,996,945 565,445 Product development
3,278,513 1,732,880 General and administrative � 5,338,287 � �
7,725,515 � Total $ 12,791,518 � $ 10,309,169 � � (2) As a result
of the adoption of SFAS 123R, Marchex recorded an amount from the
cumulative impact of the accounting change. � (3) Calculation of
the 2006 diluted net loss per share applicable to common
stockholders excludes the effect of the discount on preferred stock
redemption of $5.8 million, net of dividends on the redeemed
preferred shares of $197,000. The shares used to calculate the 2006
diluted net loss per share applicable to common stockholders
includes the weighted average common share equivalents for the
redeemed preferred shares. � MARCHEX, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets (unaudited) � � December 31,
December 31, Assets � 2006 � � 2007 � � Current assets: Cash and
cash equivalents $ 46,105,827 $ 36,456,307 Trade accounts
receivable, net 22,035,343 18,307,386 Prepaid expenses and other
current assets 2,221,550 2,118,390 Refundable taxes 1,837,166
1,693,695 Deferred tax assets � 670,624 � � 867,465 � Total current
assets 72,870,510 59,443,243 � Property and equipment, net
7,280,075 7,357,903 Deferred tax assets 2,444,782 7,447,315
Intangibles and other assets, net 13,318,801 17,381,827 Goodwill
200,738,098 204,766,826 Intangible assets from acquisitions, net �
36,735,570 � � 23,797,231 � � Total assets $ 333,387,836 � $
320,194,345 � � � Liabilities and Stockholders' Equity � Current
liabilities: Accounts payable $ 10,739,231 $ 11,625,779 Accrued
expenses and other current liabilities 2,913,152 3,668,342 Deferred
revenue � 2,430,644 � � 2,906,379 � Total current liabilities
16,083,027 18,200,500 � Other non-current liabilities � 91,907 � �
105,368 � Total liabilities 16,174,934 18,305,868 � Stockholders'
equity: Convertible preferred stock 2,342,884 1,446,649 Class A
common stock 119,217 113,717 Class B common stock 276,361 298,164
Treasury stock - (22,116,275 ) Additional paid-in capital
320,607,113 329,858,427 Accumulated deficit � (6,132,673 ) �
(7,712,205 ) Total stockholders' equity � 317,212,902 � �
301,888,477 � � Total liabilities and stockholders' equity $
333,387,836 � $ 320,194,345 � MARCHEX, INC. AND SUBSIDIARIES
Reconciliation of Revenue to Pro Forma Revenue (unaudited) � � � �
Three Months Ended Twelve Months Ended December 31, December 31, �
2006 � 2007 � 2006 � � 2007 � Revenue, as reported $ 32,606,314 $
37,008,033 $ 127,759,475 $ 139,390,659 � AreaConnect pro forma
revenue - - 649,675 - � Open List pro forma revenue - - 156,511 - �
VoiceStar pro forma revenue 310,654 - 772,971 1,675,712 � Pro forma
eliminations � - � - � (22,259 ) � - � Pro forma Revenue $
32,916,968 $ 37,008,033 $ 129,316,373 � $ 141,066,371 MARCHEX, INC.
AND SUBSIDIARIES Reconciliation of GAAP Net Income (Loss) to
Operating Income Before Amortization (OIBA) and Adjusted Operating
Income Before Amortization (Adjusted OIBA) (unaudited) � � Three
Months Ended December 31, � 2006 � � 2007 � � Net income (loss)
applicable to common stockholders $ 4,972,509 $ (774,165 ) �
Convertible preferred stock dividends and discount on preferred
stock redemption (5,535,570 ) 17,891 � � Net loss (563,061 ) �
(756,274 ) � Income tax expense (benefit) � 1,984,954 � � (21,676 )
� Income (loss) before provision for income taxes 1,421,893
(777,950 ) � Interest income and other, net � (835,992 ) � (370,827
) � Income (loss) from operations 585,901 (1,148,777 ) �
Stock-based compensation 2,634,162 2,093,285 Amortization of
intangible assets from acquisitions � 5,121,162 � � 4,325,618 � �
Operating income before amortization (OIBA) 8,341,225 5,270,126 �
Gain on sales and disposals of intangible assets, net � (85,194 ) �
(997 ) � Adjusted operating income before amortization (Adjusted
OIBA) $ 8,256,031 � $ 5,269,129 � MARCHEX, INC. AND SUBSIDIARIES
Reconciliation of GAAP Net Income (Loss) to Operating Income Before
Amortization (OIBA) and Adjusted Operating Income Before
Amortization (Adjusted OIBA) (unaudited) � � Year Ended December
31, � 2006 � � 2007 � � Net income (loss) applicable to common
stockholders $ 2,753,704 $ (1,410,120 ) � � Convertible preferred
stock dividends, conversion payment and discount on preferred stock
redemption, net � (3,197,341 ) � (95,148 ) � Net loss (443,637 ) �
(1,505,268 ) � Cumulative effect of a change in accounting
principle, net of tax (1) � 151,341 � � - � � Loss before
cumulative effect of a change in accounting principle (594,978 )
(1,505,268 ) � Income tax expense � 4,290,201 � � 960,401 � �
Income (loss) before provision for income taxes 3,695,223 (544,867
) � Interest income and other, net � (3,143,363 ) � (2,492,493 ) �
Income (loss) from operations 551,860 (3,037,360 ) � Stock-based
compensation 12,791,518 10,309,169 Amortization of intangible
assets from acquisitions � 20,465,128 � � 16,930,348 � � Operating
income before amortization (OIBA) 33,808,506 24,202,157 � Facility
relocation - 121,124 Gain on sales and disposals of intangible
assets, net � (369,960 ) � (283,076 ) � Adjusted operating income
before amortization (Adjusted OIBA) $ 33,438,546 � $ 24,040,205 � �
(1) As a result of the adoption of SFAS 123R, Marchex recorded an
amount from the cumulative impact of the accounting change.
MARCHEX, INC. AND SUBSIDIARIES Reconciliation from Net Cash
provided by Operating Activities to Adjusted EBITDA (unaudited) � �
Three Months Ended December 31, � 2006 � � 2007 � � Net cash
provided by operating activities $ 3,974,053 $ 9,496,441 � Changes
in asset and liabilities, net of effects of acquisitions 4,444,289
(1,298,969 ) Provision for income taxes 1,984,954 (21,676 ) Other
item - facility relocation (10,932 ) 4,533 Interest income and
other, net (835,592 ) (370,721 ) Income and excess tax benefits
related to stock options � 437,667 � � 87,330 � Adjusted EBITDA $
9,994,439 � $ 7,896,938 � � Year Ended December 31, � 2006 � � 2007
� � Net cash provided by operating activities $ 30,807,871 $
37,068,910 � Changes in asset and liabilities, net of effects of
acquisitions 5,069,636 (4,816,666 ) Provision for income taxes
4,290,201 960,401 Other item - facility relocation 32,499 12,614
Interest income and other, net (3,152,727 ) (2,495,630 ) Income and
excess tax benefits related to stock options � 2,463,018 � �
2,550,308 � Adjusted EBITDA $ 39,510,498 � $ 33,279,937 � MARCHEX,
INC. AND SUBSIDIARIES Reconciliation of GAAP EPS to Adjusted
Non-GAAP EPS (unaudited) � � Three Months Ended December 31, � 2006
� � 2007 � Adjusted Non-GAAP EPS $ 0.13 � $ 0.08 � � � Net loss per
share applicable to common stockholders - diluted (GAAP EPS) $
(0.01 ) $ (0.02 ) Shares used to calculate diluted net loss per
share applicable to common stockholders 39,745,623 37,735,790 � Net
income (loss) applicable to common stockholders $ 4,972,509 $
(774,165 ) � Discount on preferred stock redemption (5,761,134 ) -
Stock-based compensation 2,634,162 2,093,285 Amortization of
intangible assets from acquisitions 5,121,162 4,325,618 Gain on
sales and disposals of intangible assets, net (85,194 ) (997 )
Interest income and other, net (835,992 ) (370,827 ) Estimated
impact of income taxes � (975,429 ) � (1,880,951 ) � Adjusted
Non-GAAP net income applicable to common stockholders $ 5,070,084 �
$ 3,391,963 � � � Adjusted Non-GAAP EPS $ 0.13 � $ 0.08 � � Shares
used to calculate diluted net loss per share applicable to common
stockholders 39,745,623 37,735,790 Weighted average common share
equivalents for redeemed preferred shares (900,537 ) - Weighted
average stock options and warrants and common shares subject to
repurchase or cancellation (if applicable) � 1,591,877 � �
3,747,029 � Shares used to calculate Adjusted Non-GAAP EPS �
40,436,963 � � 41,482,819 � � � For Adjusted Non-GAAP EPS, the
impact of restricted stock (common shares subject to repurchase or
cancellation) is based on the weighted average of restricted stock
outstanding as compared with diluted shares for GAAP purposes,
which included restricted stock on a treasury stock method basis.
MARCHEX, INC. AND SUBSIDIARIES Reconciliation of GAAP EPS to
Adjusted Non-GAAP EPS (unaudited) � � Year Ended December 31, �
2006 � � 2007 � Adjusted Non-GAAP EPS $ 0.47 � $ 0.36 � � � Net
loss per share applicable to common stockholders - diluted (GAAP
EPS) $ (0.04 ) $ (0.04 ) Shares used to calculate diluted net loss
per share applicable to common stockholders 39,500,123 38,937,697 �
Net income (loss) applicable to common stockholders $ 2,753,704 $
(1,410,120 ) � Discount on preferred stock redemption (5,761,134 )
(163,867 ) Stock-based compensation 12,791,518 10,309,169 Facility
relocation - 121,124 Amortization of intangible assets from
acquisitions 20,465,128 16,930,348 Gain on sales and disposals of
intangible assets, net (369,960 ) (283,076 ) Cumulative effect of a
change in accounting principle, net of tax (1) (151,341 ) -
Interest income and other, net (3,143,363 ) (2,492,493 ) Estimated
impact of income taxes � (7,730,395 ) � (7,734,810 ) � Adjusted
Non-GAAP net income applicable to common stockholders $ 18,854,157
� $ 15,276,275 � � � Adjusted Non-GAAP EPS $ 0.47 � $ 0.36 � �
Shares used to calculate diluted net loss per share applicable to
common stockholders 39,500,123 38,937,697 Weighted average common
share equivalents for redeemed preferred shares (1,238,239 ) -
Weighted average stock options and warrants and common shares
subject to repurchase or cancellation (if applicable) 2,090,623 �
3,382,111 � Shares used to calculate Adjusted Non-GAAP EPS �
40,352,507 � � 42,319,808 � � For Adjusted Non-GAAP EPS, the impact
of restricted stock (common shares subject to repurchase or
cancellation) is based on the weighted average of restricted stock
outstanding as compared with diluted shares for GAAP purposes,
which included restricted stock on a treasury stock method basis. �
(1) As a result of the adoption of SFAS 123R, Marchex recorded an
amount from the cumulative impact of the accounting change.
Marchex (MM) (NASDAQ:MCHXP)
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Marchex (MM) (NASDAQ:MCHXP)
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