Marchex Announces Fourth Quarter and Full Year 2021 Results|||

SEATTLE–(BUSINESS WIRE)–Marchex, Inc. (NASDAQ: MCHX), the honour-winning AI-powered chat intelligence company that helps businesses turn strategic insights into the actions that drive their most valued sales outcomes, today announced its fiscal results for the fourth quarter and year concluded Dec 31, 2021.

Q4 2021 and Total Year 2021 Financial Highlights

• GAAP acquirement was $12.8 million for the fourth quarter of 2021, compared to $12.7 million for the fourth quarter of 2020. GAAP revenue was $53.five million for 2021, compared to $51.two million in 2020.
• Fourth quarter 2021 core analytics and solutions acquirement was $12.8 million every bit compared to the quaternary quarter of 2020 amount of $12.3 1000000, which excludes the benefit of recognizing $274,000 of acquirement that was reserved at the end of the 2020 third quarter during the pandemic given it did not meet recognition criteria under our revenue recognition policies at such fourth dimension. Including this amount, cadre analytics and solutions acquirement for the fourth quarter of 2020 was $12.5 1000000. Core analytics and solutions acquirement was $53.5 1000000 in 2021, compared to $50.4 million in 2020.
• Internet loss from continuing operations was $2.0 meg for the 4th quarter of 2021 or $0.04 per diluted share, compared to a net loss of $5.7 million or $0.13 per diluted share for the fourth quarter of 2020. Net loss from standing operations was $iv.4 1000000 for 2021 or $0.10 per diluted share, compared to a net loss of $42.0 million for 2020 or $0.93 per diluted share for 2020.

		Q4 2020		Q4 2021			FY 2020		FY 2021
GAAP Revenue		$12.7 million		$12.8 million			$51.2 million		$53.5 million
Non-GAAP Results:
Adjusted EBITDA from standing operations		$(3.2) 1000000		$sixty,000			$(15.0) million		$(3.5) million

• Adjusted not-GAAP income (loss) per share from continuing operations for the fourth quarter of 2021 was ($0.01) compared to ($0.09) for the fourth quarter of 2020. Adapted non-GAAP income (loss) per share from continuing operations for 2021 was ($0.12) compared to ($0.28) for 2020.

Strategic Priorities and Growth Initiatives

• 
  New Client Traction and Existing Customer Expansion.
  Marchex saw continued momentum with new enterprise customers beyond multiple production lines in Auto, Habitation Services, Health Care and other verticals. This included traction with multiple OEM partners and the signing of a new large Domicile Services aggregator, which is expected to be onboarded afterwards this year.
• 
  Company Maintains Profitability Metrics in the 4th Quarter
  . In the fourth quarter of 2021, Marchex achieved break-even Adjusted EBITDA in office through continued progress with the Visitor’s price initiatives, including its engineering science and cloud-based infrastructure projects.
• 
  Chat Volumes.
  
  Conversation volume trends were sequentially flat in Oct versus recent prior months and the ensuing holiday periods embodied the historically normal seasonality trends of lower volumes.
• 
  Expansion of Market Opportunities.
  
  • 
    Marchex Announces New Integration into Fortellis.
    
    Recently, Marchex announced its integration into the Fortellis Commerce Exchange Platform. This integration is designed to empower automotive dealers to easily deploy Marchex’s conversation intelligence and provide a better customer experience by automatically delivering upwards-to-date conversations, events, and outcomes inside CDK Elead CRM, i of the auto industry’due south largest CRMs. Through this integration, Marchex is enabling dealers to increase sales efficiency past taking the best actions needed to optimize every opportunity and sell more than vehicles.
• 
  Accelerate Product Innovation.
  
  • 
    Marchex Launches Chat Dna™.
    
    The Company announced the launch of Conversation DNA, a core technology that enables voice and text conversation decoding, scoring, categorization and point delivery beyond every Marchex conversation intelligence product. Powering such products as Marchex Anywhere, Engage and Engage for Automotive, and Marketing Edge, Conversation Deoxyribonucleic acid identifies actionable insights from a growing base of more than than ane billion minutes of consumer-to-business vox conversations and hundreds of millions of text letters that Marchex’southward AI powered conversation intelligence technology processes each year. The resulting AI signals enable businesses to have the actions that anticipate the needs of their consumers, deliver highly personalized experiences and increase sales.

“
In the fourth quarter of 2021 and continuing through today, Marchex continues to get together the fundamental ingredients to capitalize on our opportunity in conversational intelligence,” said Russell Horowitz, Executive Chairman and Co-CEO. “
Through expanding our opportunities with Fortune 500 customers and developing manufacture leading products, we are positioning ourselves to drive significant long-term growth. This yr we volition continue to invest in leveraging the growing base of billions of minutes of conversational data that flows through our platform to create kickoff-ever AI-driven sales engagement signals and making those signals bachelor to a broader base of businesses across more verticals. These investments, coupled with our deject-based engineering infrastructure initiatives, open the door to new growth opportunities as Marchex is solving an increasing assortment of mission critical problems for our customers across a growing number of direct and indirect sales channels.

Business Outlook

The following frontward-looking statements reverberate Marchex’s expectations equally of March 2, 2022.

“
Throughout January and the first office of Feb 2022, with the pandemic resurgence, nosotros saw customer conversation volumes in key categories remain suppressed, consistent with fourth quarter 2021 levels, which we await will bear on growth to a degree in the get-go quarter,” said Mike Arends Co-CEO. “
Despite this, we conceptualize that sales traction will lead to sequential growth from last year’s fourth quarter and as compared to the first quarter of 2021. In addition, nosotros believe we should be at or near break-even on an Adjusted EBITDA ground for the commencement quarter.

“
Furthermore, as we continue to make progress with some of our largest customers likewise as onboard new potentially meaning relationships, and as our new products like our cloud-based Marchex Anywhere initiative begin to roll out, nosotros believe nosotros could run into growth expand equally nosotros motion through the year. These opportunities, along with continued traction with new production sales, are driving the expansion of our pipeline. In addition, if we come across an unwinding of the pandemic bear on on volumes at some signal during the year, we believe that should convert to a tailwind in many of our verticals and enable us to achieve accelerating growth and potentially increasing double digit growth rates.” said Arends.

Management will agree a conference call, starting at 5:00 p.m. ET on Wednesday, March 2, 2022 to hash out its 4th quarter and year concluded December 31, 2021 financial results and other company updates. Access to the alive webcast of the conference phone call will be available online from the Investors department of Marchex’s website at www.marchex.com. An archived version of the webcast will also be available at the aforementioned location two hours subsequently completion of the call.

Most Marchex

Marchex’south award-winning conversation intelligence platform, featuring AI-powered sales engagement and marketing solutions, helps businesses plow strategic insights into the actions that bulldoze their nearly valued sales outcomes. Our multichannel voice and text capabilities enable sales and marketing teams to evangelize the buying experiences that today’s customers expect. Marchex is the trusted conversation intelligence partner for market-leading companies in critical industries, including many of the world’s most innovative and successful brands.

Please visit http://www.marchex.com, www.marchex.com/weblog or @marchex on Twitter (Twitter.com/Marchex), where Marchex discloses textile information from fourth dimension to time nigh the visitor, its financial information, and its business concern.

Forward-Looking Statements:

This press release contains forrad-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, futurity revenues, other financial guidance, acquisitions, dispositions, 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 y’all should non identify undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forrard-looking statements we brand. There are a number of important factors that could cause Marchex’due south actual results to differ materially from those indicated by such forrad-looking statements including but non limited to product need, order cancellations and delays, competition and full general economical conditions. These factors are described in greater detail in the “Gamble 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 March 2, 2022 and Marchex undertakes no duty to update the information provided herein.

In the upshot the press release contains links to third political party websites or materials, the links are provided solely as a convenience to you. Marchex is not responsible for the content of linked tertiary-party sites or materials and does not make any representations regarding the content or accuracy thereof.

Discontinued Operations:

In October 2020, the Company sold its interest in the Local Leads Platform, Call Marketplace and other assets non related to cadre conversational analytics and sales engagement solutions. As a issue, the financial results of these dispositions are presented as discontinued operations internet of tax in our condensed consolidated statements of operations in accordance with GAAP for the previous year presented.

Non-GAAP Financial Information:

To supplement Marchex’s consolidated fiscal statements presented in accord with GAAP and to provide clarity internally and externally, Marchex uses certain non-GAAP measures of fiscal performance and liquidity, including Adjusted EBITDA, Adjusted OIBA, and Adjusted non-GAAP income (loss) per share.

Adjusted EBITDA from continuing operations

represents cyberspace income (loss) from continuing operations before (1) gain on loan extinguishment, (2) interest, (3) income taxes, (4) amortization of intangible avails from acquisitions, (5) depreciation and amortization, (6) stock-based compensation expense, (7) acquisition and disposition-related costs (do good), (viii) harm of goodwill and intangibles assets from acquisitions, and (9) foreign government assistance subsidies. Marchex believes that Adjusted EBITDA is an culling mensurate used past our management to understand and evaluate our core operating functioning and trends, and that provides meaningful supplemental data regarding performance and evaluating functioning and liquidity to measure its power to fund operations and its financing obligations.

Adjusted OIBA from continuing operations

represents Adjusted EBITDA from continuing operations adapted for depreciation and amortization. This measure, among other things, is another metric by which Marchex evaluates the performance of its business. Adjusted OIBA is the footing on which Marchex’s internal budgets are based and past which Marchex’s direction is currently evaluated. Marchex believes these measures are useful to investors because they represent Marchex’s consolidated operating results, taking into business relationship depreciation and other intangible amortization, which Marchex believes is an ongoing cost of doing business, but excluding the effects of certain other expenses every bit detailed above. Fiscal analysts and investors may use Adjusted EBITDA and Adjusted OIBA to help with comparative fiscal evaluation to make informed investment decisions.

Adjusted not-GAAP income (loss) per share from continuing operations
represents Adapted non-GAAP income (loss) from continuing operations divided past GAAP diluted shares outstanding. Adjusted non-GAAP income (loss) generally captures those items on the argument of operations that accept been, or ultimately will be, settled in greenbacks exclusive of certain items that are not indicative of Marchex’s recurring core operating results and represents cyberspace income (loss) applicable to common stockholders plus the cyberspace of revenue enhancement effects of: (1) stock-based bounty expense, (ii) acquisition and disposition related costs (do good), (three) acquittal of intangible assets from acquisitions, (4) impairment of goodwill and intangibles assets from acquisitions, (5) gain on loan extinguishment, (half dozen) interest income and other, net, (7) cyberspace income from discontinued operations, net of tax, and (8) estimated bear on of income taxes. Fiscal analysts and investors may use Adjusted non-GAAP income (loss) per share to analyze Marchex’s fiscal functioning since these groups have historically used EPS related measures, forth with other measures, to gauge 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 take access to, and Marchex is obligated to provide, the same ready of tools that management uses in analyzing the visitor’due south results. These non-GAAP measures should be considered in addition to results prepared in accordance with GAAP, and should non be considered in isolation, equally a substitute for, or superior to, GAAP results. Marchex’due south non-GAAP financial measures may exist defined differently from time to time and may exist defined differently than similar titled terms used by other companies, and appropriately, care should be exercised in understanding how Marchex defines its non-GAAP financial measures in this release. 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 not-GAAP measure.

MARCHEX, INC. AND SUBSIDIARIES Condensed Consolidated Statements of Operations (in thousands, except per share amounts) (unaudited)
		3 Months Ended								Twelve Months Ended
		Dec 31,								December 31,
(In Thousands)		2020				2021				2020				2021
Acquirement		$	12,691			$	12,790			$	51,218			$	53,476
Expenses:
Service costs (1)			v,459				5,305				20,888				21,694
Sales and marketing (one)			iii,693				3,304				16,656				13,549
Product development (ane)			5,169				2,823				21,001				sixteen,112
General and administrative (1)			3,015				2,334				12,796				ix,294
Acquittal of intangible assets from acquisitions			1,156				773				5,331				4,481
Acquisition and disposition related costs (benefit)			(71	)			39				(1,043	)			142
Total operating expenses			eighteen,421				14,578				75,629				65,272
Impairment of goodwill			—				—				(14,688	)			—
Damage of intangible avails from acquisitions			—				—				(4,959	)			—
Loss from operations			(5,730	)			(1,788	)			(44,058	)			(11,796	)
Gain on loan extinguishment			–				–				—				v,185
Interest income (expense) and other, net			(16	)			–				123				2,453
Loss before provision for income taxes			(5,746	)			(1,788	)			(43,935	)			(4,158	)
Income tax (benefit)			(57	)			247				(1,917	)			232
Loss from standing operations			(v,689	)			(2,035	)			(42,018	)			(4,390	)
Income from discontinued operations, cyberspace of revenue enhancement			295				—				iii,572				—
Internet loss applicable to mutual stockholders		$	(five,394	)		$	(2,035	)		$	(38,446	)		$	(4,390	)
Basic and diluted net loss per Class A and Class B share applicative to mutual stockholders
Continuing operations		$	(0.xiii	)		$	(0.04	)			(0.91	)			(0.10	)
Discontinued operations, net of tax		$	0.01			$	—				0.08				–
Basic and diluted net loss per Form A and Course B share applicative to common stockholders		$	(0.12	)		$	(0.04	)		$	(0.83	)		$	(0.x	)
Shares used to calculate basic net loss per share applicative to common stockholders:
Class A			4,661				4,661				4,661				four,661
Class B			39,411				39,527				41,599				39,256
Shares used to calculate diluted net loss per share applicable to common stockholders:
Course A			iv,661				4,661				four,661				4,661
Class B			44,072				44,188				46,260				43,917
(i) Includes stock-based compensation allocated as follows:
Service costs		$	vii			$	34			$	36			$	49
Sales and marketing			283				207				1,041				870
Product development			97				66				358				296
General and authoritative			596				360				two,172				1,459
Full		$	983			$	667			$	3,607			$	ii,674

MARCHEX, INC. AND SUBSIDIARIES Condensed Consolidated Balance Sheets (in thousands) (unaudited)
		December 31,				Dec 31,
(In Thousands)		2020				2021
Assets
Current avails:
Cash and greenbacks equivalents		$	33,851			$	27,086
Accounts receivable, net			6,331				8,021
Prepaid expenses and other current assets			2,160				two,407
Total electric current assets			42,342				37,514
Property and equipment, internet			2,747				2,817
Other assets, net			ane,345				986
Right-of-use charter asset			iii,744				2,238
Goodwill			17,558				17,558
Intangible avails from acquisitions, net			9,196				4,714
Full assets		$	76,932			$	65,827
Liabilities and Stockholders’ Equity
Electric current liabilities:
Accounts payable		$	2,424			$	1,363
Accrued benefits and payroll			v,975				3,631
Other accrued expenses and current liabilities			4,210				3,869
Deferred acquirement and deposits			1,393				2,016
Lease liability current			1,827				one,794
Loan obligations, current			v,123				—
Full electric current liabilities			twenty,952				12,673
Deferred taxation liabilities			156				186
Lease liability non-current			3,136				i,466
Full liabilities			24,244				14,325
Stockholders’ equity:
Course A common stock			49				49
Class B common stock			365				374
Additional paid-in capital			350,960				354,155
Accumulated deficit			(298,686	)			(303,076	)
Total stockholders’ disinterestedness			52,688				51,502
Total liabilities and stockholders’ equity		$	76,932			$	65,827

MARCHEX, INC. AND SUBSIDIARIES (in thousands) (unaudited) Reconciliation of GAAP Internet Loss from Standing Operations to Adapted EBITDA from Continuing Operations and Adjusted Operating Income (Loss) Before Amortization (OIBA) from Continuing Operations
		Three Months Ended								Twelve Months Concluded
		December 31,								December 31,
(In Thousands)		2020				2021				2020				2021
Net loss from standing operations		$	(5,689	)		$	(two,035	)		$	(42,018	)		$	(4,390	)
Gain on loan extinguishment			–				–				–				(5,185	)
Interest income (expense) and other, internet			16				–				(123	)			(ii,453	)
Income tax expense (do good)			(57	)			247				(one,917	)			232
Acquittal of intangible assets from acquisitions			ane,156				773				five,331				4,481
Depreciation and amortization			500				379				1,918				1,487
Stock-based compensation			983				667				3,607				2,674
Acquisition and disposition-related costs (do good)			(71	)			39				(1,043	)			142
Impairment of goodwill			—				—				14,688				—
Impairment of intangible assets from acquisitions			—				—				4,959				—
Foreign government paycheck assistance and rent subsidies1			(46	)			(10	)			(415	)			(444	)
Adjusted EBITDA from standing operations		$	(3,208	)		$	60			$	(xv,013	)		$	(three,456	)
Depreciation and acquittal			500				379				1,918				ane,487
Adjusted OIBA from continuing operations		$	(three,708	)		$	(319	)		$	(16,931	)		$	(iv,943	)

1

Includes pandemic related wage and hire relief subsidies, recognized every bit a reduction of wages or rent during the period received.

MARCHEX, INC. AND SUBSIDIARIES (in thousands) (unaudited) Reconciliation of GAAP Cyberspace Loss per Share to Adjusted Not-GAAP Loss from Continuing Operations per Share
		Iii Months Concluded								Twelve Months Concluded
		Dec 31,								December 31,
		2020				2021				2020				2021
Cyberspace loss applicable to common stockholders, diluted		$	(0.12	)		$	(0.04	)		$	(0.83	)		$	(0.10	)
Stock-based compensation			0.02				0.01				0.08				0.06
Acquisition and disposition-related costs (benefit)			–				–				(0.02	)			–
Amortization of intangible assets from acquisitions			0.02				0.02				0.11				0.10
Harm of goodwill			–				–				0.32				–
Impairment of intangible assets from acquisitions			–				–				0.ten				–
Proceeds on loan extinguishment			–				–				–				(0.12	)
Involvement income and other, cyberspace			–				–				–				(0.05	)
Income from discontinued operations, internet of taxation			(0.01	)			–				(0.08	)			–
Foreign regime paycheck assistance and rent subsidies			–				–				(0.01	)			(0.01	)
Estimated touch on of income taxes			–				–				0.05				–
Adapted not-GAAP loss from continuing operations per share		$	(0.09	)		$	(0.01	)		$	(0.28	)		$	(0.12	)
Shares used to calculate diluted internet loss per share applicable to mutual stockholders (GAAP) and Adjusted Not-GAAP loss from continuing operations per share			44,072				44,188				46,260				43,917

1

For the purpose of computing the number of diluted shares for Adjusted Not-GAAP income (loss) from continuing operations per share, Marchex uses the bookkeeping guidance that would exist applicable for computing the number of diluted shares for GAAP net income (loss) per share.

MARCHEX, INC. AND SUBSIDIARIES (in thousands) (unaudited) Acquirement Reconciliation
			Three Months Concluded							Twelve Months Ended
			December 31,							December 31,
($ in thousands)			2020				2021			2020			2021
Cadre Analytics & Solutions Revenue1			$	12,546			$	12,790		$	50,421		$	53,476
Other analytics2				145				–			797			–
Total Revenue			$	12,691			$	12,790		$	51,218		$	53,476

ane		Cadre analytics and solutions acquirement includes revenue from analytics and sales date solutions customers, including those that are purchasing or buying products derived from the company’s voice communication applied science platform.
ii		Includes revenue from consulting services or other analytics revenues.

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