SYNACOR, INC., 10-Q filed on 5/15/2020
Quarterly Report
v3.20.1
Cover - shares
3 Months Ended
Mar. 31, 2020
May 13, 2020
Cover [Abstract]    
Document Type 10-Q  
Document Quarterly Report true  
Document Period End Date Mar. 31, 2020  
Document Transition Report false  
Entity File Number 001-33843  
Entity Registrant Name Synacor, Inc.  
Entity Incorporation, State or Country Code DE  
Entity Tax Identification Number 16-1542712  
Entity Address, Address Line One 40 La Riviere Drive, Suite 300  
Entity Address, City or Town Buffalo,  
Entity Address, State or Province NY  
Entity Address, Postal Zip Code 14202  
City Area Code 716  
Local Phone Number 853-1362  
Title of 12(b) Security Common Stock, $0.01 Par Value  
Trading Symbol SYNC  
Security Exchange Name NASDAQ  
Entity Current Reporting Status Yes  
Entity Interactive Data Current Yes  
Entity Filer Category Non-accelerated Filer  
Entity Small Business true  
Entity Emerging Growth Company false  
Entity Shell Company false  
Entity Common Stock, Shares Outstanding   39,449,337
Amendment Flag false  
Document Fiscal Year Focus 2020  
Document Fiscal Period Focus Q1  
Entity Central Index Key 0001408278  
Current Fiscal Year End Date --12-31  
v3.20.1
Condensed Consolidated Balance Sheets - Unaudited - USD ($)
$ in Thousands
Mar. 31, 2020
Dec. 31, 2019
CURRENT ASSETS:    
Cash and cash equivalents $ 8,922 $ 10,966
Accounts Receivable, after Allowance for Credit Loss, Current 14,820 20,532
Prepaid expenses and other current assets 4,181 2,989
Total current assets 27,923 34,487
PROPERTY AND EQUIPMENT, net 14,234 14,948
OPERATING LEASE RIGHT-OF-USE ASSETS, net 4,051 4,765
GOODWILL 15,934 15,948
INTANGIBLE ASSETS, net 7,875 8,411
OTHER ASSETS 1,136 1,319
Total assets 71,153 79,878
CURRENT LIABILITIES:    
Accounts payable 12,588 12,583
Accrued expenses and other current liabilities 3,313 5,878
Current portion of deferred revenue 5,952 6,509
Current portion of long-term debt and finance leases 1,819 2,529
Current portion of operating lease liabilities 1,826 2,165
Total current liabilities 25,498 29,664
LONG-TERM PORTION OF DEBT AND FINANCE LEASES 986 729
LONG-TERM PORTION OF OPERATING LEASE LIABILITIES 2,411 2,846
DEFERRED REVENUE 2,295 2,366
DEFERRED INCOME TAXES 295 275
OTHER LONG-TERM LIABILITIES 341 334
Total liabilities 31,826 36,214
COMMITMENTS AND CONTINGENCIES (Note 8)
STOCKHOLDERS’ EQUITY:    
Preferred stock – par value $0.01 per share; authorized 10,000,000 shares; none issued 0 0
Common stock – par value $0.01 per share; authorized 100,000,000 shares; 40,266,348 shares issued and 39,361,813 shares outstanding at March 31, 2020 and 40,075,475 shares issued and 39,201,477 shares outstanding at December 31, 2019 403 401
Treasury stock – at cost, 904,535 shares at March 31, 2020 and 873,998 shares at December 31, 2019 (1,971) (1,931)
Additional paid-in capital 146,844 146,460
Accumulated deficit (105,272) (100,747)
Accumulated other comprehensive loss (677) (519)
Total stockholders’ equity 39,327 43,664
Total liabilities and stockholders’ equity $ 71,153 $ 79,878
v3.20.1
Condensed Consolidated Balance Sheets - Unaudited (Parenthetical) - USD ($)
Mar. 31, 2020
Dec. 31, 2019
Statement of Financial Position [Abstract]    
Allowance for doubtful accounts $ 589 $ 585
Preferred stock, par value (in dollars per share) $ 0.01 $ 0.01
Preferred stock, shares authorized (in shares) 10,000,000 10,000,000
Preferred stock, shares issued (in shares) 0 0
Common stock, par value (in dollars per share) $ 0.01 $ 0.01
Common stock, shares authorized (in shares) 100,000,000 100,000,000
Common stock, shares issued (in shares) 40,266,348 40,075,475
Common stock, shares outstanding (in shares) 39,361,813 39,201,477
Treasury stock, shares (in shares) 904,535 873,998
v3.20.1
Condensed Consolidated Statements of Operations - Unaudited - USD ($)
$ in Thousands
3 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Income Statement [Abstract]    
REVENUE $ 20,583 $ 31,824
COSTS AND OPERATING EXPENSES:    
Cost of revenue (exclusive of depreciation and amortization shown separately below) 10,729 16,506
Technology and development (exclusive of depreciation and amortization shown separately below) 3,108 4,546
Sales and marketing 4,368 5,991
General and administrative (exclusive of depreciation and amortization shown separately below) 4,466 4,465
Depreciation and amortization 2,214 2,435
Total costs and operating expenses 24,885 33,943
LOSS FROM OPERATIONS (4,302) (2,119)
OTHER INCOME, net 167 216
INTEREST EXPENSE (59) (64)
LOSS BEFORE INCOME TAXES (4,194) (1,967)
PROVISION FOR INCOME TAXES 331 277
NET LOSS $ (4,525) $ (2,244)
NET LOSS PER SHARE:    
Basic (in dollars per share) $ (0.11) $ (0.06)
Diluted (in dollars per share) $ (0.11) $ (0.06)
WEIGHTED AVERAGE SHARES USED TO COMPUTE NET LOSS PER SHARE:    
Basic (in shares) 39,677,738 39,038,642
Diluted (in shares) 39,677,738 39,038,642
v3.20.1
Condensed Consolidated Statements of Comprehensive Loss - Unaudited - USD ($)
$ in Thousands
3 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Statement of Comprehensive Income [Abstract]    
Net loss $ (4,525) $ (2,244)
Other comprehensive loss:    
Changes in foreign currency translation adjustment (158) (137)
Comprehensive loss $ (4,683) $ (2,381)
v3.20.1
Condensed Consolidated Statements of Stockholders' Equity - Unaudited - USD ($)
$ in Thousands
Total
Common Stock
Treasury Stock
Additional Paid-in Capital
Accumulated Deficit
Accumulated Other Comprehensive Loss
Beginning balance (in shares) at Dec. 31, 2018   39,880,054 852,482      
Beginning balance at Dec. 31, 2018 $ 51,171 $ 399 $ (1,899) $ 144,739 $ (91,726) $ (342)
Increase (Decrease) in Temporary Equity [Roll Forward]            
Exercise of common stock options (in shares)   24,819        
Exercise of common stock options 37     37    
Stock-based compensation cost 347     347    
Vesting of restricted stock units, net of treasury stock (in shares)   416 125      
Vesting of restricted stock units, net of treasury stock 0          
Net loss (2,244)       (2,244)  
Other comprehensive loss (137)         (137)
Ending balance (in shares) at Mar. 31, 2019   39,905,289 852,607      
Ending balance at Mar. 31, 2019 $ 49,174 $ 399 $ (1,899) 145,123 (93,970) (479)
Beginning balance (in shares) at Dec. 31, 2019 39,201,477 40,075,475 873,998      
Beginning balance at Dec. 31, 2019 $ 43,664 $ 401 $ (1,931) 146,460 (100,747) (519)
Increase (Decrease) in Temporary Equity [Roll Forward]            
Exercise of common stock options (in shares) 0          
Stock-based compensation cost $ 386     386    
Vesting of restricted stock units, net of treasury stock (in shares)   190,873 30,537      
Vesting of restricted stock units, net of treasury stock (40) $ 2 $ (40) (2)    
Net loss (4,525)       (4,525)  
Other comprehensive loss $ (158)         (158)
Ending balance (in shares) at Mar. 31, 2020 39,361,813 40,266,348 904,535      
Ending balance at Mar. 31, 2020 $ 39,327 $ 403 $ (1,971) $ 146,844 $ (105,272) $ (677)
v3.20.1
Condensed Consolidated Statements of Cash Flows - Unaudited - USD ($)
$ in Thousands
3 Months Ended
Mar. 31, 2020
Mar. 31, 2019
CASH FLOWS FROM OPERATING ACTIVITIES:    
Net loss $ (4,525) $ (2,244)
Adjustments to reconcile net loss to net cash and cash equivalents provided by (used in) operating activities:    
Depreciation and amortization 2,740 2,487
Asset impairment 0 226
Stock-based compensation expense 377 331
Provision for deferred income taxes 20 20
Change in allowance for doubtful accounts 4 38
Changes in operating assets and liabilities:    
Accounts receivable, net 5,708 4,522
Prepaid expenses and other assets (1,017) (432)
Operating lease right-of-use assets and liabilities, net (59) 29
Accounts payable, accrued expenses and other liabilities (2,408) (4,598)
Deferred revenue (628) (684)
Net cash provided by (used in) operating activities 212 (305)
CASH FLOWS FROM INVESTING ACTIVITIES:    
Purchases of property and equipment (965) (1,325)
Net cash used in investing activities (965) (1,325)
CASH FLOWS FROM FINANCING ACTIVITIES:    
Repayments on long-term debt and finance leases (1,107) (694)
Proceeds from exercise of common stock options 0 37
Purchase of treasury stock and shares received to satisfy minimum tax withholdings (40) 0
Net cash used in financing activities (1,147) (657)
Effect of exchange rate changes on cash and cash equivalents (144) (140)
NET DECREASE IN CASH AND CASH EQUIVALENTS (2,044) (2,427)
Cash and cash equivalents, beginning of period 10,966 15,921
Cash and cash equivalents, end of period 8,922 13,494
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:    
Cash paid for interest 59 64
Cash paid for income taxes 112 248
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING TRANSACTIONS:    
Minimum long-term debt and finance lease payments in accounts payable 159 26
Accrued property and equipment expenditures $ 360 $ 95
v3.20.1
The Company and Summary of Significant Accounting Principles
3 Months Ended
Mar. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
The Company and Summary of Significant Accounting Principles The Company and Summary of Significant Accounting Principles
Synacor, Inc., together with its consolidated subsidiaries (collectively, the “Company” or “Synacor”), is a digital technology company that provides email and collaboration software, cloud-based identity management platforms, managed web and mobile portals, and advertising solutions. The Company’s customers include communications providers, media companies, government entities and enterprises. Synacor is a trusted partner for enterprise software platforms and monetization solutions that Synacor delivers through public and private cloud software-as-a-service, software licensing, and professional services. Synacor enables clients to deepen their engagement with their consumers and users.
Basis of Presentation
The interim unaudited condensed consolidated financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”) and include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. In the opinion of the Company’s management, the interim unaudited condensed consolidated financial statements include all adjustments, which include only normal recurring adjustments, necessary for the fair presentation of the Company’s financial position for the periods presented. These interim unaudited condensed consolidated financial statements are not necessarily indicative of the results expected for the full fiscal year or for any subsequent period.
The accompanying condensed consolidated balance sheet as of December 31, 2019 was derived from the audited financial statements as of that date, but does not include all the information and footnotes required by U.S. GAAP. These financial statements should be read in conjunction with the consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.
Accounting Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported and disclosed in the financial statements and the accompanying notes. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Such estimates primarily relate to unsettled transactions and events as of the date of the financial statements. Actual results could differ materially from these estimates and judgments.
Many of our estimates require increased judgment due to the significant volatility, uncertainty and economic disruption of the recent global COVID-19 pandemic. We will continue to monitor the effects of the COVID-19 pandemic, and our estimates and judgments may change materially as new events occur or additional information becomes available to us.
Concentrations of Risk
As of March 31, 2020 and December 31, 2019, the Company had concentrations equal to or exceeding 10% of the Company’s accounts receivable as follows:
Accounts Receivable
March 31, 2020December 31, 2019
Portal & Advertising Customer A 14 %
* - Less than 10%
For the three months ended March 31, 2020 and 2019, the Company had concentrations equal to or exceeding 10% of the Company’s revenue as follows:
Revenue
Three Months Ended
March 31,
20202019
Google search 11 %
Portal & Advertising Customer A 13 %
* - Less than 10%
For the three months ended March 31, 2020 and 2019, the following customers received revenue-share payments equal to or exceeding 10% of the Company’s cost of revenue:
Cost of Revenue
Three Months Ended
March 31,
20202019
Portal & Advertising Customer B 30 %
* - Less than 10%
Recent Accounting Pronouncements
Not Yet Adopted
In June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (“ASU”) No. 2016-13 ("ASU 2016-13") Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. ASU 2016-13 replaces the existing incurred loss impairment model with an expected loss model which requires the use of forward-looking information to calculate credit loss estimates. It also eliminates the concept of other-than-temporary impairment and requires credit losses related to certain available-for-sale debt securities to be recorded through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities. These changes result in earlier recognition of credit losses. The standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022. Early adoption is permitted. The Company does not believe the impact of adopting this standard will be material to its consolidated financial statements and related disclosures.
Recently Adopted
In August 2018, the FASB issued ASU No. 2018-15, Customer’s Accounting For Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (“ASU 2018-15”), which aligns the requirements for capitalizing implementation costs in a cloud computing arrangement with the requirements for capitalizing implementation costs incurred for an internal-use software license. Adoption of this guidance is required for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years and early adoption is permitted. The amendments will be applied prospectively to all implementation costs incurred after adoption. There was no impact to the Company's condensed consolidation financial statements for the quarter ended March 31, 2020 as a result of adopting this standard update on January 1, 2020.
The Company considers the applicability and impact of all ASUs. ASUs not listed above were assessed and determined to be either not applicable, or had or are expected to have minimal impact on the Company’s financial statements and related disclosures.
v3.20.1
Revenue from Contracts with Customers
3 Months Ended
Mar. 31, 2020
Revenue from Contract with Customer [Abstract]  
Revenue from Contracts with Customers Revenue from Contracts with Customers
The Company generates all of its revenue from contracts with customers. Many of the Company’s contracts with customers contain multiple performance obligations. For these contracts, the Company accounts for individual performance obligations separately if they are distinct. The transaction price is allocated to the separate performance obligations on a relative standalone selling price basis. Standalone selling prices of software licenses are typically estimated using the residual approach. Standalone selling prices of services are typically estimated based on observable transactions when these services are sold on a standalone basis. The Company usually expects payment within 30 to 90 days from the invoice date (fulfillment of performance obligations or per contract terms). None of the Company’s contracts as of March 31, 2020 contained a significant financing component. Differences between the amount of revenue recognized and the amount invoiced are recognized as deferred revenue.
Disaggregation of revenue
The following table provides information about disaggregated revenue for the three months ended March 31, 2020 and 2019 by the timing of revenue recognition, and includes a reconciliation of the disaggregated revenue by reportable segment (in thousands):
Three Months Ended
March 31,
20202019
Software & Services
Products and services transferred over time$8,330  $8,875  
Products transferred at a point in time2,732  2,283  
Total Software & Services11,062  11,158  
Portal & Advertising
Products and services transferred over time1,224  1,506  
Products transferred at a point in time8,297  19,160  
Total Portal & Advertising9,521  20,666  
Total Revenue$20,583  $31,824  
Revenue disaggregated by geography, based on the billing address of our customer, consists of the following (in thousands):
Three Months Ended
March 31,
20202019
Revenue
United States$15,295  $26,274  
International5,288  5,550  
Total revenue$20,583  $31,824  
Remaining Performance Obligations
Deferred revenue is recorded when cash payments are received or due in advance of revenue recognition from software licenses, professional services, and maintenance agreements. The timing of revenue recognition may differ from the timing of billings to customers. The changes in deferred revenue, inclusive of both current and long-term, are as follows (in thousands):
Beginning balance - January 1, 2020
$8,875  
Recognition of deferred revenue(2,793) 
Deferral of revenue2,254  
Effect of foreign currency translation(89) 
Ending balance - March 31, 2020$8,247  
The majority of the deferred revenue balance above relates to the maintenance and support contracts for the Company's email software licenses. These are recognized straight-line over the life of the contract, with the majority of the balance being recognized within the next twelve months.
Practical Expedients
The Company generally expenses sales commissions when incurred because the amortization period would have been one year or less. These costs are recorded within sales and marketing expenses.
The Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which revenue is recognized at the amount to which the Company has the right to invoice for services performed.
v3.20.1
Leases
3 Months Ended
Mar. 31, 2020
Leases [Abstract]  
Leases Leases
The Company enters into various noncancelable operating lease agreements for certain of our offices, data centers, colocations and network equipment. The Company’s leases have original lease periods expiring between 2020 and 2025. Many leases include one or more options to renew. The Company does not assume renewals in its determination of the lease term unless the renewals are deemed to be reasonably assured at lease commencement. The Company’s variable lease payments are immaterial and its lease agreements do not contain any material residual value guarantees or material restrictive covenants. Operating lease costs are included in cost of revenue and general and administrative costs in the Company’s condensed consolidated statements of operations. Finance lease amortization costs are included in depreciation and amortization, and finance lease interest costs are included in interest expense in the Company’s condensed consolidated statements of operations.
The components of lease costs are as follows (in thousands):
Three Months Ended
March 31, 2020
Three Months Ended
March 31, 2019
Finance lease cost
Amortization of right-of-use assets$1,012  $628  
Interest42  189  
Operating lease cost717  1,090  
Total lease cost$1,771  $1,907  
The lease term and discount rate are as follows :
March 31, 2020December 31, 2019
Weighted Average Remaining Lease Term
Operating leases2.1Years2.0Years
Finance leases1.8Years1.2Years
Weighted Average Discount Rate
Operating leases6.0   6.0   
Finance leases4.5   5.0   
The following is a schedule, by years, of maturities of lease liabilities as of March 31, 2020 (in thousands):
Operating LeasesFinance Leases
The remainder of 2020$1,594  $1,696  
20211,601  701  
2022930  405  
2023434  66  
202434  29  
2025—   
Total undiscounted cash flows4,593  2,899  
Less imputed interest(356) (94) 
Present value of lease liabilities$4,237  $2,805  
Supplemental cash flow information related to leases are as follows (in thousands):
Three Months Ended
March 31, 2020
Three Months Ended
March 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases$778  $1,202  
Operating cash flows from finance leases$42  $576  
Financing cash flows from finance leases$1,107  $48  
Lease liabilities arising from obtaining right-of-use-assets:
Operating leases$—  $—  
Finance leases$557  $—  
Leases Leases
The Company enters into various noncancelable operating lease agreements for certain of our offices, data centers, colocations and network equipment. The Company’s leases have original lease periods expiring between 2020 and 2025. Many leases include one or more options to renew. The Company does not assume renewals in its determination of the lease term unless the renewals are deemed to be reasonably assured at lease commencement. The Company’s variable lease payments are immaterial and its lease agreements do not contain any material residual value guarantees or material restrictive covenants. Operating lease costs are included in cost of revenue and general and administrative costs in the Company’s condensed consolidated statements of operations. Finance lease amortization costs are included in depreciation and amortization, and finance lease interest costs are included in interest expense in the Company’s condensed consolidated statements of operations.
The components of lease costs are as follows (in thousands):
Three Months Ended
March 31, 2020
Three Months Ended
March 31, 2019
Finance lease cost
Amortization of right-of-use assets$1,012  $628  
Interest42  189  
Operating lease cost717  1,090  
Total lease cost$1,771  $1,907  
The lease term and discount rate are as follows :
March 31, 2020December 31, 2019
Weighted Average Remaining Lease Term
Operating leases2.1Years2.0Years
Finance leases1.8Years1.2Years
Weighted Average Discount Rate
Operating leases6.0   6.0   
Finance leases4.5   5.0   
The following is a schedule, by years, of maturities of lease liabilities as of March 31, 2020 (in thousands):
Operating LeasesFinance Leases
The remainder of 2020$1,594  $1,696  
20211,601  701  
2022930  405  
2023434  66  
202434  29  
2025—   
Total undiscounted cash flows4,593  2,899  
Less imputed interest(356) (94) 
Present value of lease liabilities$4,237  $2,805  
Supplemental cash flow information related to leases are as follows (in thousands):
Three Months Ended
March 31, 2020
Three Months Ended
March 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases$778  $1,202  
Operating cash flows from finance leases$42  $576  
Financing cash flows from finance leases$1,107  $48  
Lease liabilities arising from obtaining right-of-use-assets:
Operating leases$—  $—  
Finance leases$557  $—  
v3.20.1
Goodwill and Intangible Assets
3 Months Ended
Mar. 31, 2020
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Intangible Assets Goodwill and Intangible Assets
The changes in the carrying amount of goodwill for the three months ended March 31, 2020 are as follows (in thousands):
Software & ServicesPortal & AdvertisingTotal
December 31, 2019$11,804  $4,144  $15,948  
Effect of foreign currency translation(14) —  (14) 
March 31, 2020$11,790  $4,144  $15,934  
The Company tests goodwill for impairment at least annually or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. As a result of the potential future financial impacts of the COVID-19 pandemic, particularly on our Portal & Advertising segment, the Company assessed its goodwill for impairment concluding that there was no impairment as of March 31, 2020. The Company has no accumulated impairment losses.
Intangible assets consisted of the following (in thousands):
March 31, 2020December 31, 2019
Customer and publisher relationships$14,780  $14,780  
Technology2,330  2,330  
Trademark300  300  
Intangible assets, gross17,410  17,410  
Less accumulated amortization(9,535) (8,999) 
Intangible assets, net$7,875  $8,411  
The Company tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets. As a result of the potential future financial impacts of the COVID-19 pandemic, the Company assessed its long-lived assets for impairment and concluded that there was no impairment as of March 31, 2020.
Amortization of intangible assets totaled $0.5 million for the three months ended March 31, 2020 and 2019.  Based on acquired intangible assets recorded at March 31, 2020, amortization is expected to be $1.5 million for the remainder of 2020, $1.4 million in 2021, $1.3 million in 2022, $1.3 million in 2023, $1.3 million in 2024 and $0.9 million thereafter.
v3.20.1
Property and Equipment - Net
3 Months Ended
Mar. 31, 2020
Property, Plant and Equipment [Abstract]  
Property and Equipment - Net Property and Equipment – Net
Property and equipment, net consisted of the following (in thousands):
March 31, 2020December 31, 2019
Computer equipment$25,784  $25,392  
Computer software31,813  31,037  
Furniture and fixtures1,304  1,315  
Leasehold improvements1,097  1,116  
Work in process (primarily software development costs)253  187  
Other260  136  
Property and equipment, gross60,511  59,183  
Less accumulated depreciation(46,277) (44,235) 
Property and equipment, net$14,234  $14,948  
Depreciation expense totaled $1.7 million and $2.0 million for the three months ended March 31, 2020 and 2019, respectively.
Property and equipment includes computer equipment and software held under finance leases of $11.3 million and $10.8 million as of March 31, 2020 and December 31, 2019, respectively. Accumulated depreciation of computer equipment and software held under finance leases amounted to $7.0 million as of March 31, 2020. Accumulated depreciation of computer equipment and software held under capital leases amounted to $6.2 million as of December 31, 2019.
For the three months ended March 31, 2020 and 2019, respectively, the Company capitalized a total of $0.4 million and $0.7 million of costs that occurred during the application development phase, related to the development of internal-use software. The Company capitalized a total of $0.5 million and $0.3 million of costs related to the development of software for sale or license for the three months ended March 31, 2020 and 2019, respectively, that occurred after technological feasibility had been achieved.
Amortization of software capitalized for internal use was $0.7 million for the three months ended March 31, 2020 and $1.1 million for the three months ended March 31, 2019, and included in depreciation and amortization in the consolidated statement of operations. Amortization of software for sale or license was $0.5 million for the three months ended March 31, 2020 and is included in cost of revenue in the consolidated statement of operations. Amortization of software for sale or license was not material for the three months ended March 31, 2019.
There were no impairment charges during the three months ended March 31, 2020. Impairment charges related to software, previously capitalized for internal use, for the three months ended March 31, 2019 was $0.2 million and was included in general and administrative expense in the consolidated statement of operations. The impairment charges were a result of circumstances that indicated that the carrying values of the assets were not fully recoverable. The Company utilizes the discounted cash flow method to determine the fair value of the capitalized software assets. 
The following table sets forth long-lived tangible assets by geographic area (in thousands):
March 31, 2020December 31, 2019
Long-lived tangible assets:
United States$13,954  $14,629  
International280  319  
Total long-lived tangible assets$14,234  $14,948  
v3.20.1
Accrued Expenses and Other Current Liabilities
3 Months Ended
Mar. 31, 2020
Accounts Payable and Accrued Liabilities, Current [Abstract]  
Accrued Expenses and Other Current Liabilities Accrued Expenses and Other Current Liabilities
Accrued expenses and other current liabilities consisted of the following (in thousands):
March 31, 2020December 31, 2019
Accrued compensation$1,607  $4,209  
Accrued content fees and other costs of revenue308  151  
Accrued taxes343  192  
Other1,055  1,326  
Total$3,313  $5,878  
v3.20.1
Segment Information
3 Months Ended
Mar. 31, 2020
Segment Reporting [Abstract]  
Segment Information Segment Information
The Company operates its business in two reportable segments: 1) Software & Services and 2) Portal & Advertising. Software & Services generates revenue by providing cloud-based identity management solutions and email/collaboration products. Portal & Advertising generates managed portal fees and advertising revenue from its traffic on its Managed Portals and other advertising solutions it provides for publishers.
The Company’s operations are organized and managed by type of products and services and segment information is reported accordingly. The Company’s chief operating decision maker (the “CODM”) is its Chief Executive Officer. The CODM reviews financial performance and allocates resources by reportable segment. There have been no operating segments aggregated to arrive at the Company’s reportable segments.
The accounting policies of each segment are the same as those described in the summary of significant accounting policies, refer to Note 1— Summary of Significant Accounting Policies, for further details. The Company evaluates the performance of its segments and allocates resources to them based on Segment Adjusted EBITDA. Segment Adjusted EBITDA is defined as EBITDA (earnings before interest, income taxes, depreciation and amortization) adjusted for certain non-cash items and other non-recurring income and expenses.
Revenue for all operating segments include only transactions with unaffiliated customers and there is no intersegment revenue.
The Company does not account for, and does not report to management, its assets or capital expenditures by segment other than goodwill and intangible assets used for impairment analysis purposes.
The tables below summarize the financial information for the Company’s reportable segments for the three months ended March 31, 2020 and 2019 (in thousands). The “Corporate Unallocated Expenses” category, as it relates to Segment Adjusted EBITDA, primarily includes corporate overhead costs, such as rent, payroll and related benefit costs and professional services which are not directly attributable to any individual segment.
Three Months Ended
March 31, 2020
RevenueCost of revenue (1)Segment Adjusted
EBITDA
Software & Services$11,062  $3,206  $3,528  
Portal & Advertising9,521  7,523  (241) 
Corporate Unallocated Expenses—  —  (2,974) 
Total Company$20,583  $10,729  $313  

Three Months Ended
March 31, 2019
RevenueCost of revenue (1)Segment Adjusted
EBITDA
Software & Services$11,158  $3,503  $2,794  
Portal & Advertising20,666  13,003  2,621  
Corporate Unallocated Expenses—  —  (3,711) 
Total Company$31,824  $16,506  $1,704  

Notes:
(1)Exclusive of depreciation and amortization shown separately on the condensed consolidated statements of operations
The following table reconciles total Segment Adjusted EBITDA to Net loss (in thousands):
Three Months Ended
March 31,
20202019
Total Segment Adjusted EBITDA$313  $1,704  
Less:
Provision for income taxes(331) (277) 
Interest expense(59) (64) 
Other income, net167  216  
Depreciation and amortization(2,732) (2,487) 
Asset impairment—  (226) 
Stock-based compensation expense(377) (331) 
Restructuring costs(60) —  
Certain professional services and legal fees*(1,446) (779) 
Net loss$(4,525) $(2,244) 

Notes:
*"Certain legal & professional services fees" includes legal fees and other related expenses outside the ordinary course of business, as well as fees and expenses related to merger and acquisition activities.
v3.20.1
Commitments and Contingencies
3 Months Ended
Mar. 31, 2020
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies Commitments and Contingencies
Litigation —The Company and its Chief Executive Officer and former Chief Financial Officer were named as defendants in a federal securities class action lawsuit filed on April 4, 2018 in the United States District Court for the Southern District of New York. The class includes persons who purchased the Company’s shares between May 4, 2016 and March 15, 2018. The plaintiff alleged that the Company made materially false and misleading statements regarding its contract with AT&T and the timing of revenue to be derived therefrom, and that as a result, class members suffered losses because Synacor shares traded at artificially inflated prices. The plaintiff sought an unspecified amount of damages, as well as interest, attorneys’ fees and legal expenses. The plaintiff filed an amended complaint on August 2, 2018, a second amended complaint on November 2, 2018, and the Company filed a motion to dismiss on December 17, 2018. The plaintiff filed an opposition to the motion to dismiss on January 19, 2019 and the Company filed its reply to plaintiff’s opposition on February 15, 2019. On August 28, 2019, the court granted the Company's motion to dismiss but permitted the plaintiff to seek leave to replead. On October 2, 2019, the plaintiff filed a letter application seeking the court's leave to file a third amended complaint. The Company filed a letter in opposition to the plaintiff's motion on October 21, 2019. The court denied plaintiffs’ application to file an amended complaint and ordered the case closed on November 15, 2019. The Clerk of the Court entered judgment in favor of the Company and the individual defendants and closed the case on November 19, 2019. Plaintiff filed its Notice of Appeal on December 16, 2019. Plaintiff-Appellant filed its brief in support of its appeal on March 20, 2020. The Company disputes these claims and intends to defend them vigorously. The Company cannot yet determine whether it is probable that a loss will be incurred in connection with this complaint, nor can the Company reasonably estimate the potential loss, if any. Legal fees and liabilities related to this lawsuit are covered by our D&O insurance policy now that the Company has reached its deductible.
In addition, the Company is, from time to time, party to litigation arising in the ordinary course of business. It does not believe that the outcome of these claims will have a material adverse effect on its consolidated financial position, results of operations or cash flows based on the status of proceedings at this time. However, these matters are subject to inherent uncertainties and the Company’s view of these matters may change in the future.
v3.20.1
Stock-based Compensation
3 Months Ended
Mar. 31, 2020
Share-based Payment Arrangement [Abstract]  
Stock-based Compensation Stock-based Compensation
The Company has stock-based employee compensation plans for which compensation cost is recognized in its financial statements. The Company is authorized to grant key employees stock-based incentive awards, including options to purchase common stock, stock appreciation rights, restricted stock units ("RSUs"), performance stock units ("PSUs") or other stock units. The cost is measured at the grant date, based on the fair value of the award, determined using the Black-Scholes option pricing model, and is recognized as an expense over the employee’s requisite service period (generally the vesting period of the equity award).
The following table presents the weighted-average assumptions used to estimate the fair value of options granted during the periods indicated:
Three Months Ended
March 31, 2020
Three Months Ended
March 31, 2019
Weighted average grant date fair value$0.88  $0.99  
Expected dividend yield— %— %
Expected stock price volatility63 %61 %
Risk-free interest rate2.1 %2.6 %
Expected life of options (in years)5.826.25
Total stock-based compensation expense included in the accompanying condensed consolidated statements of operations for the periods presented, is as follows (in thousands):
Three Months Ended
March 31,
20202019
Technology and development$57  $103  
Sales and marketing101  115  
General and administrative219  113  
Total stock-based compensation expense$377  $331  
Stock Option Activity – A summary of the stock option activity for the three months ended March 31, 2020 is presented below:
Number of
Shares
Weighted
Average
Exercise
Price
Weighted
Average
Remaining
Contractual
Term (years)
Aggregate
Intrinsic
Value (in
thousands)
Outstanding at January 1, 2020
7,296,746  $2.48  
Granted76,500  1.52  
Exercised—  —  
Forfeited(43,917) 2.05  
Expired(331,996) 2.40  
Outstanding at March 31, 20206,997,333  $2.47  5.33$—  
Vested and expected to vest at March 31, 20206,961,490  $2.48  5.30$—  
Vested and exercisable at March 31, 20205,872,722  $2.54  4.76$—  
Aggregate intrinsic value represents the difference between the Company’s closing stock price of its common stock and the exercise price of outstanding, in-the-money options. The Company’s closing stock price as reported on the Nasdaq Global Market as of March 31, 2020 was $1.02 per share. The total intrinsic value of options exercised for the three months ended March 31, 2020 was minimal. The weighted average fair value of options granted during the three months ended March 31, 2020 amounted to $0.88 per option share.
As of March 31, 2020, the unrecognized compensation cost related to options granted, for which vesting is probable, and adjusted for estimated forfeitures, was approximately $1.2 million. This cost is expected to be recognized over a weighted-average remaining period of 2.01 years.
RSU Activity —A summary of RSU activity for the three months ended March 31, 2020 is as follows:
Number of SharesWeighted Average
Fair Value
Unvested—January 1, 2020
677,354  $1.54  
Granted87,506  1.10  
Vested(190,873) 1.52  
Forfeited(1,251) 1.76  
Unvested—March 31, 2020
572,736  $1.49  
As of March 31, 2020, total unrecognized compensation cost, adjusted for estimated forfeitures, related to RSUs was $0.7 million. This cost is expected to be recognized over a weighted-average remaining period of 2.06 years.
PSU Activity  — A summary of PSU activity for the three months ended March 31, 2020 is as follows:
Number of SharesWeighted Average
Fair Value
Unvested—January 1, 2020
297,789  $1.36  
Granted—  —  
Vested—  —  
Forfeited(74,442) —  
Unvested—March 31, 2020
223,347  $1.36  
As of March 31, 2020, total unrecognized compensation cost, adjusted for estimated forfeitures, related to PSU's was $0.2 million. This cost is expected to be recognized over a weighted-average remaining period of 2.76 years.
v3.20.1
Net Loss Per Common Share Data
3 Months Ended
Mar. 31, 2020
Earnings Per Share [Abstract]  
Net Loss Per Common Share Data Net Loss Per Common Share Data
Basic net loss per share is computed using the weighted-average number of common shares outstanding during the period. Diluted net loss per share is computed using the weighted-average number of common shares and, if dilutive, potential common shares outstanding during the period. The Company’s potential common shares consist of the incremental common shares issuable upon the exercise of stock options, warrants, and to a lesser extent, shares issuable upon the release of RSUs. The dilutive effect of these potential common shares is reflected in diluted earnings per share by application of the treasury stock method.
The following securities were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive for the periods presented:
Three Months Ended
March 31,
20202019
Anti-dilutive equity awards:
Stock options7,147,040  7,612,104  
Restricted stock units625,045  202,888  
Performance based stock units260,568  —  
v3.20.1
Merger Agreement with Qumu Corporation
3 Months Ended
Mar. 31, 2020
Business Combinations [Abstract]  
Merger Agreement with Qumu Corporation Merger Agreement with Qumu CorporationOn February 11, 2020, the Company, Qumu Corporation, a Minnesota corporation (“Qumu”), and Quantum Merger Sub I, Inc., a Minnesota corporation and a direct, wholly owned subsidiary of Synacor (“Merger Sub”), entered into an Agreement and Plan of Merger and Reorganization (the “Merger Agreement”) for a proposed “merger of equals” transaction, pursuant to which, and subject to the conditions in the Merger Agreement, Merger Sub will merge with and into Qumu (the “Merger”), with Qumu surviving the Merger as a wholly owned subsidiary of the Company. Pursuant to the Merger Agreement, each issued and outstanding share of common stock, par value $0.01 per share, of Qumu will be converted into the right to receive 1.61 newly issued shares of common stock, par value $0.01 per share, of Synacor. No fractional shares of Synacor common stock will be issued in the Merger, and Qumu stockholders will receive cash in lieu of fractional shares of Synacor common stock, as specified in the Merger Agreement.
The closing of the Merger is subject to customary closing conditions, including (i) the absence of any adverse law or order promulgated, entered, enforced, enacted or issued by any governmental entity that makes illegal or prohibits the Merger, (ii) the Securities and Exchange Commission (the “SEC”) shall have declared effective the Form S-4 Registration Statement of Synacor, (iii) the approval of the Merger Agreement by the affirmative vote of the holders of a majority of the outstanding shares of Qumu common stock entitled to vote thereon, (iv) the approval of the issuance of shares of Synacor common stock pursuant to the Merger Agreement by the affirmative vote of a majority of votes present or represented by proxy at Synacor’s stockholder meeting in connection with the Merger, (v) the authorization for listing on The Nasdaq Stock Market, subject to official notice of issuance, of the shares of Synacor Common Stock to be issued in the Merger, (vi) the receipt of certain opinions from legal counsel regarding the intended tax treatment of the Merger, (vii) subject to certain materiality exceptions, the accuracy of certain representations and warranties of each of Qumu and Synacor contained in the Merger Agreement and the compliance by each party with the covenants contained in the Merger Agreement, and (viii) the absence of a material adverse effect with respect to each of Qumu and Synacor.
The Merger Agreement also contains a non-solicitation provision pursuant to which neither Qumu nor Synacor is permitted to solicit, initiate, induce or knowingly encourage or facilitate, any acquisition proposal from third parties or to engage in discussions or negotiations with third parties regarding any acquisition proposal. Notwithstanding this limitation, prior to a party’s requisite shareholder approval, such party may under certain circumstances provide information to and participate in discussions or negotiations with third parties with respect to an acquisition proposal that its board of directors has determined in good faith constitutes or is reasonably likely to lead to a superior proposal. Each party’s board of directors may change its recommendation to its shareholders (subject to the other party’s right to terminate the Merger Agreement following such change in recommendation) in response to a superior proposal or an intervening event if the board of directors determines in good faith that the failure to take such action would reasonably be expected to be inconsistent with the directors’ fiduciary duties under the Minnesota Business Corporation Act or the General Corporation Law of the State of Delaware, as applicable.
If the Merger Agreement is terminated under certain circumstances as indicated in the Merger Agreement Qumu or Synacor, as applicable, may be required to pay the other party a termination fee of $2.0 million.
The parties expect the Merger will be completed in the third quarter of calendar year 2020. During the three months ended March 31, 2020, the Company recognized transaction-related expenses related to the Merger Agreement of $1.4 million, which are included within general and administrative expenses in the Company's condensed consolidated statement of operations.
v3.20.1
Subsequent Event
3 Months Ended
Mar. 31, 2020
Subsequent Events [Abstract]  
Subsequent Event Subsequent Event On April 30, 2020, the Company entered into the First Amendment (the "Amendment") to the Loan and Security Agreement dated August 17, 2019, (the "Agreement"), with Silicon Valley Bank (the "Lender"). The Amendment changed the date from April 30, 2020 to May 31, 2020 for which the minimum Free Cash Flow target proposed by the Lender is to be agreed upon by the Company, as defined by the Agreement, with respect to any period from September 30, 2020 through and including December 31, 2020.
v3.20.1
The Company and Summary of Significant Accounting Principles (Policies)
3 Months Ended
Mar. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Basis of Presentation
Basis of Presentation
The interim unaudited condensed consolidated financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”) and include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. In the opinion of the Company’s management, the interim unaudited condensed consolidated financial statements include all adjustments, which include only normal recurring adjustments, necessary for the fair presentation of the Company’s financial position for the periods presented. These interim unaudited condensed consolidated financial statements are not necessarily indicative of the results expected for the full fiscal year or for any subsequent period.
The accompanying condensed consolidated balance sheet as of December 31, 2019 was derived from the audited financial statements as of that date, but does not include all the information and footnotes required by U.S. GAAP. These financial statements should be read in conjunction with the consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.
Accounting Estimates
Accounting Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported and disclosed in the financial statements and the accompanying notes. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Such estimates primarily relate to unsettled transactions and events as of the date of the financial statements. Actual results could differ materially from these estimates and judgments.
Many of our estimates require increased judgment due to the significant volatility, uncertainty and economic disruption of the recent global COVID-19 pandemic. We will continue to monitor the effects of the COVID-19 pandemic, and our estimates and judgments may change materially as new events occur or additional information becomes available to us.
Recent Accounting Pronouncements
Recent Accounting Pronouncements
Not Yet Adopted
In June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (“ASU”) No. 2016-13 ("ASU 2016-13") Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. ASU 2016-13 replaces the existing incurred loss impairment model with an expected loss model which requires the use of forward-looking information to calculate credit loss estimates. It also eliminates the concept of other-than-temporary impairment and requires credit losses related to certain available-for-sale debt securities to be recorded through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities. These changes result in earlier recognition of credit losses. The standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022. Early adoption is permitted. The Company does not believe the impact of adopting this standard will be material to its consolidated financial statements and related disclosures.
Recently Adopted
In August 2018, the FASB issued ASU No. 2018-15, Customer’s Accounting For Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (“ASU 2018-15”), which aligns the requirements for capitalizing implementation costs in a cloud computing arrangement with the requirements for capitalizing implementation costs incurred for an internal-use software license. Adoption of this guidance is required for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years and early adoption is permitted. The amendments will be applied prospectively to all implementation costs incurred after adoption. There was no impact to the Company's condensed consolidation financial statements for the quarter ended March 31, 2020 as a result of adopting this standard update on January 1, 2020.
The Company considers the applicability and impact of all ASUs. ASUs not listed above were assessed and determined to be either not applicable, or had or are expected to have minimal impact on the Company’s financial statements and related disclosures.
v3.20.1
The Company and Summary of Significant Accounting Principles (Tables)
3 Months Ended
Mar. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Schedule of Concentrations Equal to or Exceeding 10% of Company's Accounts Receivable, Revenue, and Cost of Revenue
As of March 31, 2020 and December 31, 2019, the Company had concentrations equal to or exceeding 10% of the Company’s accounts receivable as follows:
Accounts Receivable
March 31, 2020December 31, 2019
Portal & Advertising Customer A 14 %
* - Less than 10%
For the three months ended March 31, 2020 and 2019, the Company had concentrations equal to or exceeding 10% of the Company’s revenue as follows:
Revenue
Three Months Ended
March 31,
20202019
Google search 11 %
Portal & Advertising Customer A 13 %
* - Less than 10%
For the three months ended March 31, 2020 and 2019, the following customers received revenue-share payments equal to or exceeding 10% of the Company’s cost of revenue:
Cost of Revenue
Three Months Ended
March 31,
20202019
Portal & Advertising Customer B 30 %
* - Less than 10%
v3.20.1
Revenue from Contracts with Customers (Tables)
3 Months Ended
Mar. 31, 2020
Revenue from Contract with Customer [Abstract]  
Summary of Timing of Revenue Recognition, Includes Reconciliation of Disaggregated Revenue by Reportable Segment
The following table provides information about disaggregated revenue for the three months ended March 31, 2020 and 2019 by the timing of revenue recognition, and includes a reconciliation of the disaggregated revenue by reportable segment (in thousands):
Three Months Ended
March 31,
20202019
Software & Services
Products and services transferred over time$8,330  $8,875  
Products transferred at a point in time2,732  2,283  
Total Software & Services11,062  11,158  
Portal & Advertising
Products and services transferred over time1,224  1,506  
Products transferred at a point in time8,297  19,160  
Total Portal & Advertising9,521  20,666  
Total Revenue$20,583  $31,824  
Summary of Revenue Disaggregated by Geography Areas
Revenue disaggregated by geography, based on the billing address of our customer, consists of the following (in thousands):
Three Months Ended
March 31,
20202019
Revenue
United States$15,295  $26,274  
International5,288  5,550  
Total revenue$20,583  $31,824  
Schedule of Contract with Customer, Asset and Liability The changes in deferred revenue, inclusive of both current and long-term, are as follows (in thousands):
Beginning balance - January 1, 2020
$8,875  
Recognition of deferred revenue(2,793) 
Deferral of revenue2,254  
Effect of foreign currency translation(89) 
Ending balance - March 31, 2020$8,247  
v3.20.1
Leases (Tables)
3 Months Ended
Mar. 31, 2020
Leases [Abstract]  
Schedule of Components of Lease Costs, Lease Term and Discount Rate
The components of lease costs are as follows (in thousands):
Three Months Ended
March 31, 2020
Three Months Ended
March 31, 2019
Finance lease cost
Amortization of right-of-use assets$1,012  $628  
Interest42  189  
Operating lease cost717  1,090  
Total lease cost$1,771  $1,907  
The lease term and discount rate are as follows :
March 31, 2020December 31, 2019
Weighted Average Remaining Lease Term
Operating leases2.1Years2.0Years
Finance leases1.8Years1.2Years
Weighted Average Discount Rate
Operating leases6.0   6.0   
Finance leases4.5   5.0   
Schedule of Maturities of Operating Leases Liabilities
The following is a schedule, by years, of maturities of lease liabilities as of March 31, 2020 (in thousands):
Operating LeasesFinance Leases
The remainder of 2020$1,594  $1,696  
20211,601  701  
2022930  405  
2023434  66  
202434  29  
2025—   
Total undiscounted cash flows4,593  2,899  
Less imputed interest(356) (94) 
Present value of lease liabilities$4,237  $2,805  
Schedule of Maturities of Finance Leases Liabilities
The following is a schedule, by years, of maturities of lease liabilities as of March 31, 2020 (in thousands):
Operating LeasesFinance Leases
The remainder of 2020$1,594  $1,696  
20211,601  701  
2022930  405  
2023434  66  
202434  29  
2025—   
Total undiscounted cash flows4,593  2,899  
Less imputed interest(356) (94) 
Present value of lease liabilities$4,237  $2,805  
Schedule of Supplemental Cash Flow Leases
Supplemental cash flow information related to leases are as follows (in thousands):
Three Months Ended
March 31, 2020
Three Months Ended
March 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases$778  $1,202  
Operating cash flows from finance leases$42  $576  
Financing cash flows from finance leases$1,107  $48  
Lease liabilities arising from obtaining right-of-use-assets:
Operating leases$—  $—  
Finance leases$557  $—  
v3.20.1
Goodwill and Intangible Assets (Tables)
3 Months Ended
Mar. 31, 2020
Goodwill and Intangible Assets Disclosure [Abstract]  
Schedule of Changes in the Carrying Amount of Goodwill
The changes in the carrying amount of goodwill for the three months ended March 31, 2020 are as follows (in thousands):
Software & ServicesPortal & AdvertisingTotal
December 31, 2019$11,804  $4,144  $15,948  
Effect of foreign currency translation(14) —  (14) 
March 31, 2020$11,790  $4,144  $15,934  
Schedule of Intangible Assets
Intangible assets consisted of the following (in thousands):
March 31, 2020December 31, 2019
Customer and publisher relationships$14,780  $14,780  
Technology2,330  2,330  
Trademark300  300  
Intangible assets, gross17,410  17,410  
Less accumulated amortization(9,535) (8,999) 
Intangible assets, net$7,875  $8,411