Welcome!

Recurring Revenue Authors: Karthick Viswanathan, Liz McMillan, Yeshim Deniz, Carmen Gonzalez, Elizabeth White

News Feed Item

TechTarget Reports Third Quarter 2012 Financial Results

Technology media company TechTarget, Inc. (NASDAQ: TTGT) today announced financial results for the three months ended September 30, 2012. Additionally, the Company announced that it has appointed Bob Burke, former CEO of Art Technology Group (ATG), to its Board of Directors.

“Despite the continued weakness in the IT market, we continue to make good progress with our Activity Intelligence™ product roll-out and international expansion, which we are optimistic will result in a return to growth in 2013,” said Greg Strakosch, TechTarget Chairman and CEO. “We continue to manage expenses carefully as evidenced by our healthy margins and cash flow.”

With respect to results for the quarter, total Q3 2012 revenues decreased 5% to $24.5 million compared to Q3 2011. Q3 2012 online revenue decreased by 6% to $20.4 million compared to Q3 2011. Online revenues represented 83% of total Q3 2012 revenues. Q3 2012 events revenue decreased by 1% to $4.1 million compared to Q3 2011 and represented 17% of total Q3 2012 revenues.

Adjusted EBITDA (earnings before interest, other income and expense, income taxes, depreciation and amortization, as further adjusted to eliminate stock-based compensation) for Q3 2012 decreased 19% to $4.4 million compared to $5.4 million for Q3 2011.

The Company generated $6.0 million of cash in the quarter.

Total gross profit margin for Q3 2012 was 71%, compared to 73% for Q3 2011. Online gross profit margin decreased to 71% for Q3 2012, compared to 75% for Q3 2011. Events gross profit margin increased to 67% for Q3 2012, as compared to 64% for Q3 2011.

Net income was $0.7 million for Q3 2012 compared to $1.0 million in Q3 2011. Adjusted net income (net income adjusted to eliminate amortization, stock-based compensation expense and the related income tax impact of these charges) for Q3 2012 was $2.0 million compared to $2.6 million for Q3 2011. Net income per basic share was $0.02 for Q3 2012 compared to $0.03 in Q3 2011. Adjusted net income per share (adjusted net income divided by adjusted weighted average diluted shares outstanding) for Q3 2012 was $0.05 compared to $0.06 for Q3 2011.

The Company’s balance sheet and financial position remain strong. As of September 30, 2012, the Company’s cash, cash equivalents and investments totaled $72.6 million, and the Company had no outstanding bank debt.

Recent Company Highlights

  • Bob Burke has joined the Board of Directors. Bob has over 35 years of experience in the technology industry and was most recently the CEO of Art Technology Group. Under his leadership, ATG became a leading e-commerce software provider and was successfully sold to Oracle for over $1 billion. Before ATG, Bob was CEO of Quidnunc, a privately-held web consultancy firm with headquarters in London. Before Quidnunc, Bob was President of ePresence Solutions (formerly Banyan Systems). Bob started his career at Digital Equipment Corporation, where his most recent position was general manager of its billion-dollar plus systems integration business with operations in over 45 countries. He is currently associated with Technology Crossover Ventures as a venture partner advisor to portfolio companies in the software and Internet sectors. Bob has a B.S. in Physics from Eastern Michigan University.
  • The Company’s first paid Activity Intelligence offering, Nurture and Notify™, continues to gain traction. This add-on service has been sold onto over 100 lead generation campaigns; feedback from customers has been very positive and renewal rates for campaigns with this offering are strong. The Company is developing a new suite of Activity Intelligence subscription products based on data mining the millions of data points that the Company manages in its data warehouse.
  • Geo-targeted revenues have grown over 50% in the first 3 quarters of 2012 versus the same period in 2011. Online geo-targeted revenues represented 22% of online revenue in the 3rd quarter with excellent results both in EMEA and, especially, APAC, where the Company’s new direct operations in Singapore and Australia are contributing to growth. The number of customers conducting geo-targeted campaigns in Q3 was up 42% versus the same period a year ago.

Financial Guidance

In the fourth quarter of 2012, the Company expects total revenues to be within the range of $24.5 million to $25.7 million, online revenues within the range of $22.0 million to $23.0 million, events revenues within the range of $2.5 million to $2.7 million, and adjusted EBITDA to be within the range of $4.7 million to $5.4 million.

Conference Call and Webcast

TechTarget will discuss these financial results in a conference call at 5:00 p.m. (Eastern Time) today (November 7, 2012). Supplemental financial information and our Chief Executive Officer’s Letter to Shareholders will be posted to the Investor Information section of our website simultaneously with this press release.

NOTE: Our Chief Executive Officer’s Letter to Shareholders will not be read on the conference call. The conference call will include only brief remarks followed by questions and answers.

The public is invited to listen to a live webcast of TechTarget’s conference call, which can be accessed on the Investor Information section of our website at http://investor.techtarget.com/. The conference call can also be heard via telephone by dialing 1-877-317-6789 (US callers), 1-866-605-3852 (Canadian callers) or 1-412-317-6789 (International callers).

For those investors unable to participate in the live conference call, a replay of the conference call will be available via telephone beginning November 7, 2012 at 7:00 p.m. ET through December 10, 2012 at 9:00 a.m. ET. To listen to the replay, for US, dial 1-877-344-7529 and use the conference number 10019305. International callers should dial 1-412-317-0088 and also use the conference number 10019305. The webcast replay will also be available for replay on http://investor.techtarget.com/ during the same period.

Non-GAAP Financial Measures

This release and the accompanying tables include a discussion of adjusted EBITDA, adjusted EBITDA margin, adjusted net income and adjusted net income per share, all of which are non-GAAP financial measures which are provided as a complement to results provided in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The term “adjusted EBITDA” refers to a financial measure that we define as earnings before net interest, other income and expense, income taxes, depreciation and amortization, as further adjusted to exclude stock-based compensation and restructuring charges, if any. The term “adjusted EBITDA margin” refers to a financial measure which we define as adjusted EBITDA as a percentage of total revenues. The term “adjusted net income” refers to a financial measure which we define as net income adjusted for amortization, stock-based compensation and restructuring charges, if any, as further adjusted for the related income tax impact of the adjustments. The term “adjusted net income per share” refers to a financial measure which we define as adjusted net income divided by adjusted weighted average diluted shares outstanding. These non-GAAP measures should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for, or superior to, GAAP results. In addition, our definition of adjusted EBITDA, adjusted EBITDA margin, adjusted net income and adjusted net income per share may not be comparable to the definitions as reported by other companies. We believe adjusted EBITDA, adjusted EBITDA margin, adjusted net income and adjusted net income per share are relevant and useful information because it provides us and investors with additional measurements to compare the Company’s operating performance. These measures are part of our internal management reporting and planning process and are primary measures used by our management to evaluate the operating performance of our business, as well as potential acquisitions. The components of adjusted EBITDA include the key revenue and expense items for which our operating managers are responsible and upon which we evaluate their performance. In the case of senior management, adjusted EBITDA is used as one of the principal financial metrics in their annual incentive compensation program. Adjusted EBITDA is also used for planning purposes and in presentations to our board of directors. Adjusted net income is useful to us and investors because it presents an additional measurement of our financial performance, taking into account depreciation, which we believe is an ongoing cost of doing business, but excluding the impact of certain non-cash expenses and items not directly tied to the core operations of our business. Furthermore, we intend to provide these non-GAAP financial measures as part of our future earnings discussions and, therefore, the inclusion of these non-GAAP financial measures will provide consistency in our financial reporting. A reconciliation of these non-GAAP measures to GAAP is provided in the accompanying tables.

Forward Looking Statements

Certain matters included in this press release may be considered to be “forward-looking statements” within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, as amended by the Private Securities Litigation Reform Act of 1995. Those statements include statements regarding the intent, belief or current expectations of the Company and members of our management team. All statements contained in this press release, other than statements of historical fact, are forward-looking statements, including those regarding: guidance on our future financial results and other projections or measures of our future performance; our expectations concerning market opportunities and our ability to capitalize on them; and the amount and timing of the benefits expected from acquisitions, from new products or services and from other potential sources of additional revenue. Investors and prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those contemplated by such forward-looking statements. These statements speak only as of the date of this press release and are based on our current plans and expectations, and they involve risks and uncertainties that could cause actual future events or results to be different than those described in or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to, those relating to: market acceptance of our products and services; relationships with customers, strategic partners and our employees; difficulties in integrating acquired businesses; and changes in economic or regulatory conditions or other trends affecting the Internet, Internet advertising and information technology industries. These and other important risk factors are discussed or referenced in our Annual Report on Form 10-K filed with the Securities and Exchange Commission, under the heading “Risk Factors” and elsewhere, and any subsequent periodic or current reports filed by us with the SEC. Except as required by applicable law or regulation, we do not undertake any obligation to update our forward-looking statements to reflect future events or circumstances.

About TechTarget

TechTarget (NASDAQ: TTGT) is the online intersection of serious technology buyers, targeted technical content and technology providers worldwide. Our extensive network of online and social media, powered by TechTarget’s Activity Intelligence platform, redefines how technology marketers view and engage technology buyers based on their active projects, specific technical priorities and business needs. With more than 100 technology-specific websites and a wide selection of custom advertising, branding, and lead generation solutions, TechTarget delivers unparalleled reach and innovative opportunities to drive technology marketing success around the world.

TechTarget has offices in Atlanta, Beijing, Boston, Cincinnati, London, Mumbai, San Francisco, Singapore and Sydney.

(C) 2012 TechTarget, Inc. All rights reserved. TechTarget and the TechTarget logo are registered trademarks, and Activity Intelligence and Nurture and Notify are trademarks of TechTarget. All other trademarks are the property of their respective owners.

     

TECHTARGET, INC.
Consolidated Statements of Operations
(in $000's, except per share amounts)

 
Three Months Ended

September 30,

Nine Months Ended

September 30,

2012     2011 2012     2011
(Unaudited)
Revenues:
Online $ 20,447 $ 21,763 $ 65,556 $ 66,294
Events   4,102   4,129   9,076   10,266
Total revenues 24,549 25,892 74,632 76,560

Cost of revenues:

Online(1) 5,828 5,547 17,818 16,873
Events(1)   1,371   1,488   3,289   3,607
Total cost of revenues   7,199   7,035   21,107   20,480

Gross profit

17,350 18,857 53,525 56,080

Operating expenses:

Selling and marketing(1) 9,082 10,182 27,472 28,997
Product development(1) 1,919 1,874 5,655 5,690
General and administrative(1) 3,433 3,105 10,061 10,362
Restructuring charge 384
Depreciation 850 692 2,428 2,001
Amortization of intangible assets   843   955   2,654   3,030
Total operating expenses   16,127   16,808   48,270 50,464

Operating income

1,223 2,049 5,255 5,616
Interest income, net   37   20   85   32
Income before provision for income taxes 1,260 2,069 5,340 5,648

Provision for income taxes

  588   1,106   2,338   2,942
Net income $ 672 $ 963 $ 3,002 $ 2,706
Net income per common share:
Basic $ 0.02 $ 0.03 $ 0.07 $ 0.07
Net income per common share:
Diluted $ 0.02 $ 0.02 $ 0.07 $ 0.07
Weighted average common shares outstanding:
Basic   40,328   38,511   40,125   38,261
Weighted average common shares outstanding:
Diluted   40,878   40,008   40,894   40,578

(1) Amounts include stock-based compensation expense as follows:

Cost of online revenues $ 50 $ 65 $ 150 $ 197
Cost of events revenues 4 22 12 64
Selling and marketing 824 1,149 2,213 3,389
Product development 66 111 194 317
General and administrative 543 361 1,341 1,687
 

 

TECHTARGET, INC.

Reconciliation of Net Income to Adjusted EBITDA

(in $000’s)

   
For the Three Months Ended

September 30,

For the Nine Months Ended

September 30,

2012   2011 2012   2011
(Unaudited)
 
Net income $ 672 $ 963 $ 3,002 $ 2,706
Interest income, net (37 ) (20 ) (85 ) (32 )
Provision for income taxes 588 1,106 2,338 2,942

Restructuring charge

384
Depreciation 850 692 2,428 2,001
Amortization of intangible assets   843   955   2,654   3,030
EBITDA   2,916   3,696   10,337   11,031
Stock-based compensation expense   1,487   1,708   3,910   5,654
Adjusted EBITDA $ 4,403 $ 5,404 $ 14,247 $ 16,685
   

TECHTARGET, INC.
Reconciliation of Net Income to Adjusted Net Income and Net Income per Diluted Share to

Adjusted Net Income per Share

(in $000's, except per share amounts)

 
For the Three Months Ended

September 30,

For the Nine Months Ended

September 30,

2012   2011 2012   2011
(Unaudited)
 
Net income $ 672 $ 963 $ 3,002 $ 2,706
Amortization of intangible assets 843 955 2,654 3,030
Restructuring charge 384
Stock-based compensation expense 1,487 1,708 3,910 5,654
Impact of income taxes   (981 )   (1,028 )   (2,608 )   (3,481 )
Adjusted net income $ 2,021 $ 2,598 $ 6,958 $ 8,293
 
Net income per diluted share $ 0.02 $ 0.02 $ 0.07 $ 0.07
 
Weighted average diluted shares outstanding   40,878   40,008   40,894   40,578
 
Adjusted net income per share $ 0.05 $ 0.06 $ 0.17 $ 0.20
Adjusted weighted average diluted shares outstanding   40,878   40,008   40,894   40,578

Options, warrants and restricted stock, treasury

method included in adjusted weighted average

diluted shares above

       
 
Weighted average diluted shares outstanding   40,878   40,008   40,894   40,578
 
TECHTARGET, INC.
Financial Guidance for the Three Months Ended December 31, 2012
(in $000's)
         
For the Three Months

Ended December 31, 2012

Range
 
Revenues $ 24,500 $ 25,700
 
Adjusted EBITDA $ 4,722 $ 5,422
Depreciation, amortization and stock-based compensation 2,918 2,918
Interest and other income, net 35 36
Provision for income taxes   860   1,189
Net income $ 979 $ 1,351

More Stories By Business Wire

Copyright © 2009 Business Wire. All rights reserved. Republication or redistribution of Business Wire content is expressly prohibited without the prior written consent of Business Wire. Business Wire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

@ThingsExpo Stories
Leading companies, from the Global Fortune 500 to the smallest companies, are adopting hybrid cloud as the path to business advantage. Hybrid cloud depends on cloud services and on-premises infrastructure working in unison. Successful implementations require new levels of data mobility, enabled by an automated and seamless flow across on-premises and cloud resources. In his general session at 21st Cloud Expo, Greg Tevis, an IBM Storage Software Technical Strategist and Customer Solution Architec...
Nordstrom is transforming the way that they do business and the cloud is the key to enabling speed and hyper personalized customer experiences. In his session at 21st Cloud Expo, Ken Schow, VP of Engineering at Nordstrom, discussed some of the key learnings and common pitfalls of large enterprises moving to the cloud. This includes strategies around choosing a cloud provider(s), architecture, and lessons learned. In addition, he covered some of the best practices for structured team migration an...
Product connectivity goes hand and hand these days with increased use of personal data. New IoT devices are becoming more personalized than ever before. In his session at 22nd Cloud Expo | DXWorld Expo, Nicolas Fierro, CEO of MIMIR Blockchain Solutions, will discuss how in order to protect your data and privacy, IoT applications need to embrace Blockchain technology for a new level of product security never before seen - or needed.
Imagine if you will, a retail floor so densely packed with sensors that they can pick up the movements of insects scurrying across a store aisle. Or a component of a piece of factory equipment so well-instrumented that its digital twin provides resolution down to the micrometer.
In his keynote at 18th Cloud Expo, Andrew Keys, Co-Founder of ConsenSys Enterprise, provided an overview of the evolution of the Internet and the Database and the future of their combination – the Blockchain. Andrew Keys is Co-Founder of ConsenSys Enterprise. He comes to ConsenSys Enterprise with capital markets, technology and entrepreneurial experience. Previously, he worked for UBS investment bank in equities analysis. Later, he was responsible for the creation and distribution of life settle...
BnkToTheFuture.com is the largest online investment platform for investing in FinTech, Bitcoin and Blockchain companies. We believe the future of finance looks very different from the past and we aim to invest and provide trading opportunities for qualifying investors that want to build a portfolio in the sector in compliance with international financial regulations.
No hype cycles or predictions of a gazillion things here. IoT is here. You get it. You know your business and have great ideas for a business transformation strategy. What comes next? Time to make it happen. In his session at @ThingsExpo, Jay Mason, an Associate Partner of Analytics, IoT & Cybersecurity at M&S Consulting, presented a step-by-step plan to develop your technology implementation strategy. He also discussed the evaluation of communication standards and IoT messaging protocols, data...
Coca-Cola’s Google powered digital signage system lays the groundwork for a more valuable connection between Coke and its customers. Digital signs pair software with high-resolution displays so that a message can be changed instantly based on what the operator wants to communicate or sell. In their Day 3 Keynote at 21st Cloud Expo, Greg Chambers, Global Group Director, Digital Innovation, Coca-Cola, and Vidya Nagarajan, a Senior Product Manager at Google, discussed how from store operations and ...
In his session at 21st Cloud Expo, Raju Shreewastava, founder of Big Data Trunk, provided a fun and simple way to introduce Machine Leaning to anyone and everyone. He solved a machine learning problem and demonstrated an easy way to be able to do machine learning without even coding. Raju Shreewastava is the founder of Big Data Trunk (www.BigDataTrunk.com), a Big Data Training and consulting firm with offices in the United States. He previously led the data warehouse/business intelligence and B...
"IBM is really all in on blockchain. We take a look at sort of the history of blockchain ledger technologies. It started out with bitcoin, Ethereum, and IBM evaluated these particular blockchain technologies and found they were anonymous and permissionless and that many companies were looking for permissioned blockchain," stated René Bostic, Technical VP of the IBM Cloud Unit in North America, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Conventi...
A strange thing is happening along the way to the Internet of Things, namely far too many devices to work with and manage. It has become clear that we'll need much higher efficiency user experiences that can allow us to more easily and scalably work with the thousands of devices that will soon be in each of our lives. Enter the conversational interface revolution, combining bots we can literally talk with, gesture to, and even direct with our thoughts, with embedded artificial intelligence, whic...
When shopping for a new data processing platform for IoT solutions, many development teams want to be able to test-drive options before making a choice. Yet when evaluating an IoT solution, it’s simply not feasible to do so at scale with physical devices. Building a sensor simulator is the next best choice; however, generating a realistic simulation at very high TPS with ease of configurability is a formidable challenge. When dealing with multiple application or transport protocols, you would be...
Smart cities have the potential to change our lives at so many levels for citizens: less pollution, reduced parking obstacles, better health, education and more energy savings. Real-time data streaming and the Internet of Things (IoT) possess the power to turn this vision into a reality. However, most organizations today are building their data infrastructure to focus solely on addressing immediate business needs vs. a platform capable of quickly adapting emerging technologies to address future ...
We are given a desktop platform with Java 8 or Java 9 installed and seek to find a way to deploy high-performance Java applications that use Java 3D and/or Jogl without having to run an installer. We are subject to the constraint that the applications be signed and deployed so that they can be run in a trusted environment (i.e., outside of the sandbox). Further, we seek to do this in a way that does not depend on bundling a JRE with our applications, as this makes downloads and installations rat...
Widespread fragmentation is stalling the growth of the IIoT and making it difficult for partners to work together. The number of software platforms, apps, hardware and connectivity standards is creating paralysis among businesses that are afraid of being locked into a solution. EdgeX Foundry is unifying the community around a common IoT edge framework and an ecosystem of interoperable components.
DX World EXPO, LLC, a Lighthouse Point, Florida-based startup trade show producer and the creator of "DXWorldEXPO® - Digital Transformation Conference & Expo" has announced its executive management team. The team is headed by Levent Selamoglu, who has been named CEO. "Now is the time for a truly global DX event, to bring together the leading minds from the technology world in a conversation about Digital Transformation," he said in making the announcement.
In this strange new world where more and more power is drawn from business technology, companies are effectively straddling two paths on the road to innovation and transformation into digital enterprises. The first path is the heritage trail – with “legacy” technology forming the background. Here, extant technologies are transformed by core IT teams to provide more API-driven approaches. Legacy systems can restrict companies that are transitioning into digital enterprises. To truly become a lead...
Digital Transformation (DX) is not a "one-size-fits all" strategy. Each organization needs to develop its own unique, long-term DX plan. It must do so by realizing that we now live in a data-driven age, and that technologies such as Cloud Computing, Big Data, the IoT, Cognitive Computing, and Blockchain are only tools. In her general session at 21st Cloud Expo, Rebecca Wanta explained how the strategy must focus on DX and include a commitment from top management to create great IT jobs, monitor ...
"Cloud Academy is an enterprise training platform for the cloud, specifically public clouds. We offer guided learning experiences on AWS, Azure, Google Cloud and all the surrounding methodologies and technologies that you need to know and your teams need to know in order to leverage the full benefits of the cloud," explained Alex Brower, VP of Marketing at Cloud Academy, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clar...
The IoT Will Grow: In what might be the most obvious prediction of the decade, the IoT will continue to expand next year, with more and more devices coming online every single day. What isn’t so obvious about this prediction: where that growth will occur. The retail, healthcare, and industrial/supply chain industries will likely see the greatest growth. Forrester Research has predicted the IoT will become “the backbone” of customer value as it continues to grow. It is no surprise that retail is ...