SYNACOR, INC., 10-Q filed on 11/9/2018
Quarterly Report
v3.10.0.1
Document and Entity Information - shares
9 Months Ended
Sep. 30, 2018
Nov. 02, 2018
Document And Entity Information [Abstract]    
Document Type 10-Q  
Amendment Flag false  
Document Period End Date Sep. 30, 2018  
Document Fiscal Year Focus 2018  
Document Fiscal Period Focus Q3  
Trading Symbol SYNC  
Entity Registrant Name Synacor, Inc.  
Entity Central Index Key 0001408278  
Current Fiscal Year End Date --12-31  
Entity Filer Category Accelerated Filer  
Entity Small Business true  
Entity Emerging Growth Company false  
Entity Common Stock, Shares Outstanding   39,000,303
v3.10.0.1
Condensed Consolidated Balance Sheets - Unaudited - USD ($)
$ in Thousands
Sep. 30, 2018
Dec. 31, 2017
CURRENT ASSETS:    
Cash and cash equivalents $ 15,685 $ 22,476
Accounts receivable, net of allowance of $217 and $99, respectively 21,180 31,696
Prepaid expenses and other current assets 5,131 4,516
Total current assets 41,996 58,688
PROPERTY AND EQUIPMENT, net 19,748 20,505
GOODWILL 15,950 15,955
INTANGIBLE ASSETS, net 11,088 12,695
OTHER ASSETS 598 937
Total assets 89,380 108,780
CURRENT LIABILITIES:    
Accounts payable 17,220 25,931
Accrued expenses and other current liabilities 6,589 7,075
Current portion of deferred revenue 7,481 11,605
Current portion of capital lease obligations 2,376 2,444
Total current liabilities 33,666 47,055
LONG-TERM PORTION OF CAPITAL LEASE OBLIGATIONS 1,668 3,371
DEFERRED REVENUE 2,594 3,682
DEFERRED INCOME TAXES 85 264
OTHER LONG-TERM LIABILITIES 151 63
Total liabilities 38,164 54,435
COMMITMENTS AND CONTINGENCIES (Note 8)
STOCKHOLDERS’ EQUITY:    
Preferred stock – par value $0.01 per share; authorized 10,000,000 shares; none issued
Common stock – par value $0.01 per share; authorized 100,000,000 shares; 39,826,640 shares issued and 38,977,760 shares outstanding at September 30, 2018 and 39,625,980 shares issued and 38,783,760 shares outstanding at December 31, 2017 393 396
Treasury stock – at cost, 848,880 shares at September 30, 2018 and 842,220 shares at December 31, 2017 (1,893) (1,881)
Additional paid-in capital 144,334 142,486
Accumulated deficit (91,348) (86,627)
Accumulated other comprehensive loss (270) (29)
Total stockholders’ equity 51,216 54,345
Total liabilities and stockholders’ equity $ 89,380 $ 108,780
v3.10.0.1
Condensed Consolidated Balance Sheets - Unaudited (Parenthetical) - USD ($)
$ in Thousands
Sep. 30, 2018
Dec. 31, 2017
Statement Of Financial Position [Abstract]    
Allowance for doubtful accounts $ 217 $ 99
Preferred stock, par value $ 0.01 $ 0.01
Preferred stock, shares authorized 10,000,000 10,000,000
Preferred stock, shares issued 0 0
Common stock, par value $ 0.01 $ 0.01
Common stock, shares authorized 100,000,000 100,000,000
Common stock, shares issued 39,826,640 39,625,980
Common stock, shares outstanding 38,977,760 38,783,760
Treasury stock, shares 848,880 842,220
v3.10.0.1
Condensed Consolidated Statements of Operations - Unaudited - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Sep. 30, 2018
Sep. 30, 2017
Sep. 30, 2018
Sep. 30, 2017
Income Statement [Abstract]        
REVENUE $ 35,643 $ 36,269 $ 104,481 $ 94,025
COSTS AND OPERATING EXPENSES:        
Cost of revenue (exclusive of depreciation and amortization shown separately below) 18,186 17,620 51,659 44,644
Technology and development (exclusive of depreciation and amortization shown separately below) 6,017 6,748 18,773 20,950
Sales and marketing 5,667 6,179 18,507 19,025
General and administrative (exclusive of depreciation and amortization shown separately below) 5,279 4,495 14,616 12,820
Depreciation and amortization 2,437 2,596 7,316 7,004
Total costs and operating expenses 37,586 37,638 110,871 104,443
LOSS FROM OPERATIONS (1,943) (1,369) (6,390) (10,418)
GAIN ON SALE OF INVESTMENT   1,902   1,902
OTHER (EXPENSE) INCOME (32) 99 (46) 172
INTEREST EXPENSE (80) (127) (265) (328)
(LOSS) INCOME BEFORE INCOME TAXES (2,055) 505 (6,701) (8,672)
INCOME TAX PROVISION 165 244 478 999
NET (LOSS) INCOME $ (2,220) $ 261 $ (7,179) $ (9,671)
NET (LOSS) INCOME PER SHARE:        
Basic $ (0.06) $ 0.01 $ (0.18) $ (0.27)
Diluted $ (0.06) $ 0.01 $ (0.18) $ (0.27)
WEIGHTED AVERAGE SHARES USED TO COMPUTE NET (LOSS) INCOME PER SHARE:        
Basic 38,951,558 38,471,377 38,856,836 35,590,563
Diluted 38,951,558 39,940,790 38,856,836 35,590,563
v3.10.0.1
Condensed Consolidated Statements of Comprehensive (Loss) Income - Unaudited - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Sep. 30, 2018
Sep. 30, 2017
Sep. 30, 2018
Sep. 30, 2017
Statement Of Income And Comprehensive Income [Abstract]        
Net (loss) income $ (2,220) $ 261 $ (7,179) $ (9,671)
Other comprehensive (loss) income:        
Changes in foreign currency translation adjustment (66) (23) (241) 21
Comprehensive (loss) income $ (2,286) $ 238 $ (7,420) $ (9,650)
v3.10.0.1
Condensed Consolidated Statements of Cash Flows - Unaudited - USD ($)
$ in Thousands
9 Months Ended
Sep. 30, 2018
Sep. 30, 2017
CASH FLOWS FROM OPERATING ACTIVITIES:    
Net loss $ (7,179) $ (9,671)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:    
Depreciation and amortization 7,316 7,004
Capitalized software impairment   256
Stock-based compensation expense 1,451 1,928
Gain on sale of long-term investment   (1,902)
Provision for deferred income taxes (179) 197
Change in allowance for doubtful accounts 118  
Increase in estimated value of contingent consideration   107
Changes in operating assets and liabilities:    
Accounts receivable, net 10,398 6,933
Prepaid expenses and other assets (291) (1,646)
Accounts payable (8,284) (1,668)
Accrued expenses and other liabilities (398) (2,369)
Deferred revenue (2,756) (2,080)
Net cash provided by (used in) operating activities 196 (2,911)
CASH FLOWS FROM INVESTING ACTIVITIES:    
Proceeds from the sale of investment   2,645
Purchases of property and equipment (5,271) (5,774)
Net cash used in investing activities (5,271) (3,129)
CASH FLOWS FROM FINANCING ACTIVITIES:    
Proceeds from offering of common stock, net of underwriting costs   20,258
Payments of public offering issuance costs   (212)
Repayments of long-term debt   (5,000)
Repayments on capital lease obligations (1,811) (914)
Proceeds from exercise of common stock options 341 1,942
Treasury stock received to satisfy minimum withholding liabilities (12) (117)
Deferred acquisition payments   (1,300)
Net cash (used in) provided by financing activities (1,482) 14,657
Effect of exchange rate changes on cash and cash equivalents (234)  
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS (6,791) 8,617
Cash and cash equivalents, beginning of period 22,476 14,315
Cash and cash equivalents, end of period 15,685 22,932
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:    
Cash paid for interest 250 328
Cash paid for income taxes 293 572
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING TRANSACTIONS:    
Non-cash proceeds from sale investment   257
Property, equipment and service center contracts financed under capital lease   5,832
Minimum capital lease payments in accounts payable   454
Accrued property and equipment expenditures 142 462
Stock-based compensation capitalized to property and equipment $ 53 $ 116
v3.10.0.1
The Company and Summary of Significant Accounting Principles
9 Months Ended
Sep. 30, 2018
Organization Consolidation And Presentation Of Financial Statements [Abstract]  
The Company and Summary of Significant Accounting Principles

1.

The Company and Summary of Significant Accounting Principles

Synacor, Inc., together with its consolidated subsidiaries (collectively, the “Company” or “Synacor”), is the trusted technology development, multiplatform services and revenue partner for video, internet and communications providers, device manufacturers, governments and enterprises. Synacor enables its customers to provide their consumers engaging, multiscreen experiences and advertising to their consumers that require scale, actionable data and sophisticated implementation.

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, 2017 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, 2017.

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. Accordingly, actual results may differ from estimated amounts.

Concentrations of Risk

 

As of September 30, 2018 and December 31, 2017, the Company had concentrations equal to or exceeding 10% of the Company’s accounts receivable as follows:

 

 

 

Accounts Receivable

 

 

 

September 30, 2018

 

 

December 31, 2017

 

Google advertising affiliate

 

*

 

 

 

16

%

Google search

 

 

7

%

 

 

7

%

Advertising customer

 

 

10

%

 

 

12

%

* - Less than 10%

 

 

 

 

 

 

 

 

 

For the three months and nine months ended September 30, 2018 and 2017, the Company had concentrations equal to or exceeding 10% of the Company’s revenue as follows:

 

 

Revenue

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2018

 

 

2017

 

 

2018

 

 

2017

 

Google search

 

 

14

%

 

 

17

%

 

 

14

%

 

 

15

%

Google advertising affiliate

 

 

10

%

 

 

22

%

 

 

12

%

 

 

19

%

 

For the three months and nine months ended September 30, 2018 and 2017, 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

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2018

 

 

2017

 

 

2018

 

 

2017

 

Customer A

 

*

 

 

 

11

%

 

*

 

 

 

13

%

Customer B

 

 

21

%

 

 

27

%

 

 

25

%

 

 

16

%

* - Less than 10%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Recent Accounting Pronouncements

Not Yet Adopted

In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842) which amends lease accounting by lessors and lessees. This new standard will require, among other things, that lessees recognize a right-to-use asset and related lease liability for all significant financing and operating leases, and specifies where in the statement of cash flows the related lease payments are to be presented. In July 2018, the FASB issued Accounting Standards Update 2018-10, Codification Improvements to Topic 842 (Leases), and Accounting Standards Update 2018-11, Leases (Topic 842), Targeted Improvements, which provide (i) narrow amendments to clarify how to apply certain aspects of the new lease standard, (ii) entities with an additional transition method to adopt the new standard, and (iii) lessors with a practical expedient for separating components of a contract. All Accounting Standards Updates related to Topic 842 will be effective for annual and interim periods beginning after December 15, 2018, with early adoption permitted upon issuance. The Company is currently in the process of evaluating the impact the adoption of ASU 2016-02 will have on its consolidated financial statements, but currently expects that all of its capital and operating lease commitments will be subject to the new standard and recognized as operating lease liabilities and right-of-use assets upon the adoption of ASU 2016-02, which will increase the total assets and total liabilities that it reports as compared to those reported prior to adoption. The Company will adopt the standard on the required effective date, which for the Company will be January 1, 2019.

Recently Adopted

On January 1, 2018, the Company adopted ASU 2014-09, Revenue from Contracts with Customers ("Topic 606"), using the modified retrospective method. Results for reporting periods beginning on or after January 1, 2018 are presented under Topic 606; however, prior period amounts are not adjusted and continue to be reported in accordance with the accounting standards in effect for those periods. The Company recorded a reduction to the opening balance of the accumulated deficit of $2.5 million as of January 1, 2018 due to the cumulative impact of the adoption of Topic 606. The impact to revenue recorded for the quarter ended September 30, 2018 was nominal with the adoption of Topic 606 as compared to Topic 605. The impact to revenue for the nine months ended September 30, 2018 was an increase of approximately $0.2 million with the adoption of Topic 606 as compared to Topic 605.

In August 2016, the FASB issued ASU No. 2016-15, Classification of Certain Cash Receipts and Cash Payments. This ASU reduces the diversity in reporting of eight specific cash flow issues due to accounting guidance that is unclear or does not exist. The eight issues relate to certain debt activities, business combination activities, insurance settlements and other various activities. The Company adopted this ASU as of January 1, 2018 and it did not have an impact on its consolidated financial statements.

v3.10.0.1
Revenue from Contracts with Customers
9 Months Ended
Sep. 30, 2018
Revenue From Contract With Customer [Abstract]  
Revenue from Contracts with Customers

2.

Revenue from Contracts with Customers

 

The following is a description of principal activities from which the Company generates revenue. Revenue is recognized when control of the promised goods or services are transferred to the Company’s customers, in an amount that reflects the consideration that is expected to be received in exchange for those goods or services. The Company generates all of its revenue from contracts with customers.

 

Search & Digital Advertising

 

The Company uses internet advertising to generate revenue from the traffic on its Managed Portals and Advertising solutions, categorized as search advertising and digital advertising. For search advertising, the Company has a revenue-sharing relationship with Google, pursuant to which the Company includes a Google-branded search tool on its Managed Portals. When a Google consumer makes a search query using this tool, the Company delivers the query to Google and they return search results to consumers that include advertiser-sponsored links. If the consumer clicks on a sponsored link, Google receives payment from the sponsor of that link and shares a portion of that payment with the Company. The net payment received from Google is recognized as revenue. Digital advertising includes video, image and text advertisements delivered on its Managed Portals. Advertising inventory is filled with advertisements sourced by the Company’s direct sales force and advertising network partners. Revenue is generated when an advertisement displays, otherwise known as an impression, or when consumers view or click an advertisement, otherwise known as an action. Digital advertising revenue is on a cost per impression or cost per action basis. Digital advertising also includes advertising fees received for the placement of syndicated digital advertisements with other digital advertising publishers, for which the Company acquires and pay for the space (inventory) on a cost per impression or cost per action basis. Revenue is recognized based on amounts received from advertising customers as the impressions are delivered or the actions occur, according to contractually-determined rates.

 

Recurring and Fee-Based

 

Recurring and Fee-Based revenue includes subscription fees and other fees that are received from customers for the use of the Company’s proprietary technology, including the use of, or access to, email, Cloud ID, security services, games and other premium services and paid content. Monthly subscriber levels typically form the basis for generating Recurring and Fee-Based revenue. This revenue is typically determined by multiplying a per-subscriber per-month fee by the number of subscribers using the particular services being offered or consumed, except in the case of software licenses and support, which are based on a fixed fee. Revenue earned as subscription fees and maintenance and support fees is recognized from customers as its obligation to deliver the service is satisfied, which is when the service is delivered. Revenue is also recognized from the licensing and distribution of the Company’s Email/Collaboration products and services, including licenses of intellectual property. Software license revenue is recognized up front upon delivery of the licensed product and the utility that enables the customer to access authorization keys, provided that a signed contract has been received. The Company typically sells term-based software licenses that expire, which are referred to as subscription licenses, but also sell perpetual licenses for its Email products. The software is delivered before related services are provided and is functional without professional services, updates, and technical support.

 

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 September 30, 2018 contained a significant financing component. Differences between the amount of revenue recognized and the amount invoiced, collected from, or paid to its customers are recognized as deferred revenue.

 

Disaggregation of revenue

 

The following table provides information about disaggregated revenue for the three and nine months ended September 30, 2018 by primary geographical market and timing of revenue recognition, and includes a reconciliation of the disaggregated revenue with reportable types (in thousands):

 

 

 

Three Months Ended September 30, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Geographic Area

 

 

 

Timing of Revenue Recognition

 

 

 

 

 

 

 

United States

 

 

International

 

 

 

Products transferred

at a point in time

 

 

Products and services

transferred over time

 

 

Total

 

 

 

(in thousands)

 

 

 

(in thousands)

 

 

 

 

 

Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Search and Digital advertising

 

$

20,592

 

 

$

618

 

 

 

$

21,210

 

 

$

 

 

$

21,210

 

Recurring and Fee-based

 

 

8,601

 

 

 

5,832

 

 

 

 

3,866

 

 

 

10,567

 

 

$

14,433

 

Total revenue

 

$

29,193

 

 

$

6,450

 

 

 

$

25,076

 

 

$

10,567

 

 

$

35,643

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended September 30, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Geographic Area

 

 

 

Timing of Revenue Recognition

 

 

 

 

 

 

 

United States

 

 

International

 

 

 

Products transferred

at a point in time

 

 

Products and services

transferred over time

 

 

Total

 

 

 

(in thousands)

 

 

 

(in thousands)

 

 

 

 

 

Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Search and Digital advertising

 

$

59,720

 

 

$

2,295

 

 

 

$

62,015

 

 

$

 

 

$

62,015

 

Recurring and Fee-based

 

 

25,865

 

 

 

16,601

 

 

 

 

10,016

 

 

 

32,450

 

 

$

42,466

 

Total revenue

 

$

85,585

 

 

$

18,896

 

 

 

$

72,031

 

 

$

32,450

 

 

$

104,481

 

 

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, 2018

$

15,287

 

Record the cumulative effect of ASC 606 implementation

 

(2,456

)

Recognition of deferred revenue

 

(10,500

)

Deferral of revenue

 

7,744

 

Ending Balance - September 30, 2018

$

10,075

 

 

The majority of the deferred revenue balance above relates to the maintenance and support contracts for 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.

 

v3.10.0.1
Acquisitions
9 Months Ended
Sep. 30, 2018
Business Combinations [Abstract]  
Acquisitions

3.

Acquisitions

In August 2015, the Company and Zimbra, Inc. (now known as “TZ Holdings”) entered into an agreement under which the Company acquired certain assets relating to TZ Holdings’ email/collaboration products and services business, including certain of its wholly-owned foreign subsidiaries, for cash consideration of $17.3 million, 2.4 million shares of common stock and warrants to purchase 480,000 shares of common stock (collectively valued at $3.2 million). The Company held back an additional 600,000 shares of common stock and warrants to purchase an additional 120,000 shares of common stock (collectively valued at $0.8 million at the acquisition date) to secure TZ Holdings’ indemnification obligations including pending claims. The held back common shares and warrants were released to TZ holdings in March 2017. The warrants expired unexercised on September 14, 2018.

Additionally, TZ Holdings was eligible to receive cash consideration of up to $2.0 million (the “Earn-Out Consideration”) upon the satisfaction of certain business performance milestones following the closing of the transaction, subject to and contingent upon any reduction to satisfy indemnification claims including pending claims. The acquisition date fair value of this contingent consideration was estimated to be $1.6 million. The Company paid $0.9 million of the Earn-Out Consideration to TZ Holdings in November 2016, and the Company paid the remaining $0.7 million of the Earn-Out Consideration in May 2017.

In connection with the Company’s February 2016 acquisition of Technorati, the Company withheld $0.5 million of the purchase price to secure Technorati’s indemnification obligations under the Asset Purchase Agreement, and the Company owed approximately $0.1 million in post-closing working capital adjustments. These amounts were paid in March 2017.

v3.10.0.1
Intangible Assets
9 Months Ended
Sep. 30, 2018
Goodwill And Intangible Assets Disclosure [Abstract]  
Intangible Assets

4.

Intangible Assets

Intangible assets consisted of the following (in thousands):

 

 

 

September 30, 2018

 

 

December 31, 2017

 

Customer and publisher relationships

 

$

14,780

 

 

$

14,780

 

Technology

 

 

2,330

 

 

 

2,330

 

Trademark

 

 

300

 

 

 

300

 

 

 

 

17,410

 

 

 

17,410

 

Less accumulated amortization

 

 

(6,322

)

 

 

(4,715

)

Intangible assets, net

 

$

11,088

 

 

$

12,695

 

 

Amortization of intangible assets totaled $0.5 million for the three months ended both September 30, 2018 and 2017, and $1.6 million for the nine months ended both September 30, 2018 and 2017.  

v3.10.0.1
Property and Equipment - Net
9 Months Ended
Sep. 30, 2018
Property Plant And Equipment [Abstract]  
Property and Equipment - Net

5.

Property and Equipment – Net

Property and equipment, net consisted of the following (in thousands):

 

 

 

September 30, 2018

 

 

December 31, 2017

 

Computer equipment

 

$

28,997

 

 

$

28,845

 

Computer software

 

 

27,248

 

 

 

23,690

 

Furniture and fixtures

 

 

1,624

 

 

 

1,497

 

Leasehold improvements

 

 

1,258

 

 

 

1,215

 

Work in process (primarily software development costs)

 

 

4,719

 

 

 

3,758

 

Other

 

 

179

 

 

 

159

 

 

 

 

64,025

 

 

 

59,164

 

Less accumulated depreciation

 

 

(44,277

)

 

 

(38,659

)

Property and equipment, net

 

$

19,748

 

 

$

20,505

 

 

Depreciation expense totaled $1.9 million and $2.1 million for the three months ended September 30, 2018 and 2017, respectively, and $5.7 million and $5.4 million, for the nine months ended September 30, 2018 and 2017, respectively.   

v3.10.0.1
Accrued Expenses and Other Current Liabilities
9 Months Ended
Sep. 30, 2018
Payables And Accruals [Abstract]  
Accrued Expenses and Other Current Liabilities

6.

Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consisted of the following (in thousands):

 

 

 

September 30, 2018

 

 

December 31, 2017

 

Accrued compensation

 

$

4,819

 

 

$

4,361

 

Accrued content fees and other costs of revenue

 

 

300

 

 

 

655

 

Accrued taxes

 

 

228

 

 

 

426

 

Other

 

 

1,242

 

 

 

1,633

 

Total

 

$

6,589

 

 

$

7,075

 

 

Included in accrued compensation are accrued severance costs. In 2018, the Company initiated a cost reduction program to drive overall efficiency while adding capacity and streamlining the organization. These actions will result in workforce reductions, office consolidations and consolidating operations. Severance costs charged to technology and development and sales and marketing expenses were each $0.3 million and $0.4 million was charged to general and administrative expenses for the nine months ended September 30, 2018. The below table summarizes the activity in the accrued severance account.

 

 

 

September 30, 2018

 

Balance at January 1, 2018

 

$

21

 

Charged to expense

 

 

1,034

 

Cash payments

 

 

(569

)

Balance at September 30, 2018

 

$

486

 

 

 

v3.10.0.1
Information About Segment and Geographic Areas
9 Months Ended
Sep. 30, 2018
Segment Reporting [Abstract]  
Information About Segment and Geographic Areas

7.

Information About Segment and Geographic Areas

Operating segments are components of the Company in which separate financial information is available that is evaluated regularly by the Company’s chief operating decision maker in deciding how to allocate resources and in assessing performance. The chief operating decision maker for the Company is the Chief Executive Officer. The Chief Executive Officer reviews financial information presented on a total company basis, accompanied by information about revenue by major service line for purposes of allocating resources and evaluating financial performance. The Company has one business activity and there are no segment managers who are held accountable for operations, operating results or plans for levels or components below the company level. Accordingly, the Company has determined that it has a single reporting segment and operating unit structure.

The following tables set forth revenue and long-lived tangible assets by geographic area (in thousands):

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2018

 

 

2017

 

 

2018

 

 

2017

 

Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

United States

 

$

29,193

 

 

$

30,742

 

 

$

85,585

 

 

$

77,600

 

International

 

 

6,450

 

 

 

5,527

 

 

 

18,896

 

 

 

16,425

 

Total revenue

 

$

35,643

 

 

$

36,269

 

 

$

104,481

 

 

$

94,025

 

 

 

 

September 30, 2018

 

 

December 31, 2017

 

Long-lived tangible assets:

 

 

 

 

 

 

 

 

United States

 

$

19,175

 

 

$

19,775

 

International

 

 

573

 

 

 

730

 

Total long-lived tangible assets

 

$

19,748

 

 

$

20,505

 

 

v3.10.0.1
Commitments and Contingencies
9 Months Ended
Sep. 30, 2018
Commitments And Contingencies Disclosure [Abstract]  
Commitments and Contingencies

8.

Commitments and Contingencies

Contract Commitments

The Company is obligated to make minimum payments under various contracts with vendors and other business partners, principally for revenue-share and content arrangements. Contract commitments as of September 30, 2018 are as follows (in thousands):

 

Year ending December 31,

 

 

 

 

2018 (remaining three months)

 

$

225

 

2019

 

 

1,353

 

2020

 

 

753

 

Total

 

$

2,331

 

 

Capital Lease Commitments —

Capital lease commitments for the remainder of 2018 and for the following two years as of September 30, 2018 are summarized as follows (in thousands):

 

Years Ending December 31,

 

Capital Lease

Commitments

 

2018 (remaining three months)

 

$

748

 

2019

 

 

2,348

 

2020

 

 

1,152

 

Total minimum capital lease commitments

 

 

4,248

 

Less-amount representing interest

 

 

(204

)

Total capital lease obligations

 

 

4,044

 

Less-minimum capital lease obligations in accounts payable

 

 

-

 

Less-current portion of capital lease obligations

 

 

(2,376

)

Long-term portion of capital lease obligations

 

$

1,668

 

Litigation

The Company is awaiting a decision of an arbitration tribunal following a binding arbitration that took place on July 30, 2018 between the Company and Maxit Technology Incorporated and Maxit Technology Holdings Limited, or Maxit, who were formerly the Company’s joint venture partners in China. After unsuccessful settlement discussions between the parties, on January 25, 2016, Maxit requested arbitration under the Rules of the International Chamber of Commerce. In its request for arbitration, Maxit asserted claims for breach of contract, breach of the covenant of good faith and fair dealing, breach of fiduciary duty, and negligent misrepresentation, all arising out of the Company’s alleged failure to provide capital and software as required by the joint venture agreement. In its request, Maxit sought an award of money damages based on its share of the lost potential value of the joint venture, as well as a percentage of revenue from any future sales to customers originally introduced by Maxit, interest and legal expenses. Maxit alleges that its share of the lost potential value is approximately $15 million. Based in part on an independent appraisal, the Company assessed the lost potential value at only $0.6 million, for which half of this amount (based on 50/50 ownership) has been reserved in its financial statements. The Company contested Maxit’s claims vigorously, and while it is not possible at this time to predict the outcome of the arbitration, the Company continues to believe that Maxit’s claims are without merit. It anticipates a decision by the arbitration tribunal before the end of the calendar year 2018.

The Company and its Chief Executive Officer and former Chief Financial Officer were named as defendants in a federal securities class action lawsuit filed 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 court appointed a lead plaintiff and approved plaintiff’s selection of lead counsel on July 6, 2018. On October 16, 2018 the court appointed new lead counsel and confirmed the lead plaintiff. The plaintiff filed an amended complaint on November 2, 2018. The Company disputes these claims and intends to defend them vigorously. The liabilities related to this lawsuit are covered by D&O insurance after the Company reaches 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, regardless of the outcome, such proceedings can have an adverse impact on the Company because of defense and settlement costs, diversion of resources and other factors.  

v3.10.0.1
Stock-based Compensation
9 Months Ended
Sep. 30, 2018
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]  
Stock-based Compensation

9.

Stock-based Compensation

The Company has stock-based employee compensation plans for which compensation cost is recognized in its financial statements. 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).

No income tax deduction is allowed for incentive stock options (“ISOs”). Accordingly, no deferred income tax asset is recorded for the potential tax deduction related to these options. Expense related to stock option grants of non-qualified stock options (“NSOs”) results in a temporary difference, which gives rise to a deferred tax asset.

The following table presents the weighted-average assumptions used to estimate the fair value of options granted during the periods indicated:

 

 

 

Nine Months Ended

 

 

Nine Months Ended

 

 

 

September 30, 2018

 

 

September 30, 2017

 

Weighted average grant date fair value

 

$

1.01

 

 

$

1.53

 

Expected dividend yield

 

 

%

 

 

%

Expected stock price volatility

 

 

48

%

 

 

47

%

Risk-free interest rate

 

 

2.7

%

 

 

2.1

%

Expected life of options (in years)

 

 

6.25

 

 

 

6.36

 

 

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

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2018

 

 

2017

 

 

2018

 

 

2017

 

Technology and development

 

$

101

 

 

$

190

 

 

$

369

 

 

$

604

 

Sales and marketing

 

 

110

 

 

 

142

 

 

 

374

 

 

 

500

 

General and administrative

 

 

150

 

 

 

273

 

 

 

708

 

 

 

824

 

Total stock-based compensation expense

 

$

361

 

 

$

605

 

 

$

1,451

 

 

$

1,928

 

 

Stock Option Activity – A summary of the stock option activity for the nine months ended September 30, 2018 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, 2018

 

 

8,478,213

 

 

$

2.60

 

 

 

 

 

 

 

 

 

Granted

 

 

1,109,400

 

 

 

2.03

 

 

 

 

 

 

 

 

 

Exercised

 

 

(180,644

)

 

 

1.56

 

 

 

 

 

 

 

 

 

Forfeited or expired

 

 

(1,192,599

)

 

 

2.59

 

 

 

 

 

 

 

 

 

Outstanding at September 30, 2018

 

 

8,214,370

 

 

$

2.54

 

 

 

6.45

 

 

$

79

 

Vested and expected to vest at September 30, 2018

 

 

7,997,637

 

 

$

2.55

 

 

 

6.37

 

 

$

78

 

Vested and exercisable at September 30, 2018

 

 

5,731,815

 

 

$

2.59

 

 

 

5.48

 

 

$

57

 

 

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 September 30, 2018 was $1.60 per share. The total intrinsic value of options exercised for the nine months ended September 30, 2018 was minimal. The weighted average fair value of options granted during the nine months ended September 30, 2018 amounted to $1.01 per option share.

As of September 30, 2018, the unrecognized compensation cost related to options granted, for which vesting is probable, and adjusted for estimated forfeitures, was approximately $2.8 million. This cost is expected to be recognized over a weighted-average remaining period of 2.6 years.

 

v3.10.0.1
Net (Loss) Income Per Common Share Data
9 Months Ended
Sep. 30, 2018
Earnings Per Share [Abstract]  
Net (Loss) Income Per Common Share Data

10.

Net (Loss) Income Per Common Share Data

Basic net (loss) income per share is computed using the weighted-average number of common shares outstanding during the period. Diluted net (loss) income 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.

Stock options, warrants and RSUs are not included in the calculation of diluted net loss per share for the three and nine months ended September 30, 2018 and the nine months ended September 30, 2017 because the Company had a net loss for each of those periods. The inclusion of these equity awards would have had an antidilutive effect on the calculation of diluted loss per share. As such, the Company’s calculations of basic and diluted net loss per share are identical.

The following table presents the calculation of basic and diluted net (loss) income per share for the three months and nine months ended September 30, 2018 and 2017:

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2018

 

 

2017

 

 

2018

 

 

2017

 

Basic net (loss) income per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Numerator:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income (in thousands)

 

$

(2,220

)

 

$

261

 

 

$

(7,179

)

 

$

(9,671

)

Denominator:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding

 

 

38,951,558

 

 

 

38,471,377

 

 

 

38,856,836

 

 

 

35,590,563

 

Basic net (loss) income per share

 

$

(0.06

)

 

$

0.01

 

 

$

(0.18

)

 

$

(0.27

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted net (loss) income per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Numerator:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income (in thousands)

 

$

(2,220

)

 

$

261

 

 

$

(7,179

)

 

$

(9,671

)

Denominator:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding - basic

 

 

38,951,558

 

 

 

38,471,377

 

 

 

38,856,836

 

 

 

35,590,563

 

Add - potentially dilutive securities (options, RSUs and warrants)

 

 

 

 

 

1,469,413

 

 

 

 

 

 

 

Weighted average common shares outstanding - diluted

 

 

38,951,558

 

 

 

39,940,790

 

 

 

38,856,836

 

 

 

35,590,563

 

Diluted net (loss) income per share

 

$

(0.06

)

 

$

0.01

 

 

$

(0.18

)

 

$

(0.27

)

 

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

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2018

 

 

2017

 

 

2018

 

 

2017

 

Anti-dilutive equity awards:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock options

 

 

8,214,370

 

 

 

2,330,897

 

 

 

8,214,370

 

 

 

8,706,131

 

Restricted stock units

 

 

21,846

 

 

 

62,221

 

 

 

21,846

 

 

 

127,226

 

Warrants

 

 

495,652

 

 

 

 

 

 

564,835

 

 

 

600,000

 

 

v3.10.0.1
The Company and Summary of Significant Accounting Principles (Policies)
9 Months Ended
Sep. 30, 2018
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, 2017 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, 2017.

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. Accordingly, actual results may differ from estimated amounts.

Concentrations of Risk

Concentrations of Risk

 

As of September 30, 2018 and December 31, 2017, the Company had concentrations equal to or exceeding 10% of the Company’s accounts receivable as follows:

 

 

 

Accounts Receivable

 

 

 

September 30, 2018

 

 

December 31, 2017

 

Google advertising affiliate

 

*

 

 

 

16

%

Google search

 

 

7

%

 

 

7

%

Advertising customer

 

 

10

%

 

 

12

%

* - Less than 10%

 

 

 

 

 

 

 

 

 

For the three months and nine months ended September 30, 2018 and 2017, the Company had concentrations equal to or exceeding 10% of the Company’s revenue as follows:

 

 

Revenue

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2018

 

 

2017

 

 

2018

 

 

2017

 

Google search

 

 

14

%

 

 

17

%

 

 

14

%

 

 

15

%

Google advertising affiliate

 

 

10

%

 

 

22

%

 

 

12

%

 

 

19

%

 

For the three months and nine months ended September 30, 2018 and 2017, 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

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2018

 

 

2017

 

 

2018

 

 

2017

 

Customer A

 

*

 

 

 

11

%

 

*

 

 

 

13

%

Customer B

 

 

21

%

 

 

27

%

 

 

25

%

 

 

16

%

* - Less than 10%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Recent Accounting Pronouncements

Recent Accounting Pronouncements

Not Yet Adopted

In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842) which amends lease accounting by lessors and lessees. This new standard will require, among other things, that lessees recognize a right-to-use asset and related lease liability for all significant financing and operating leases, and specifies where in the statement of cash flows the related lease payments are to be presented. In July 2018, the FASB issued Accounting Standards Update 2018-10, Codification Improvements to Topic 842 (Leases), and Accounting Standards Update 2018-11, Leases (Topic 842), Targeted Improvements, which provide (i) narrow amendments to clarify how to apply certain aspects of the new lease standard, (ii) entities with an additional transition method to adopt the new standard, and (iii) lessors with a practical expedient for separating components of a contract. All Accounting Standards Updates related to Topic 842 will be effective for annual and interim periods beginning after December 15, 2018, with early adoption permitted upon issuance. The Company is currently in the process of evaluating the impact the adoption of ASU 2016-02 will have on its consolidated financial statements, but currently expects that all of its capital and operating lease commitments will be subject to the new standard and recognized as operating lease liabilities and right-of-use assets upon the adoption of ASU 2016-02, which will increase the total assets and total liabilities that it reports as compared to those reported prior to adoption. The Company will adopt the standard on the required effective date, which for the Company will be January 1, 2019.

Recently Adopted

On January 1, 2018, the Company adopted ASU 2014-09, Revenue from Contracts with Customers ("Topic 606"), using the modified retrospective method. Results for reporting periods beginning on or after January 1, 2018 are presented under Topic 606; however, prior period amounts are not adjusted and continue to be reported in accordance with the accounting standards in effect for those periods. The Company recorded a reduction to the opening balance of the accumulated deficit of $2.5 million as of January 1, 2018 due to the cumulative impact of the adoption of Topic 606. The impact to revenue recorded for the quarter ended September 30, 2018 was nominal with the adoption of Topic 606 as compared to Topic 605. The impact to revenue for the nine months ended September 30, 2018 was an increase of approximately $0.2 million with the adoption of Topic 606 as compared to Topic 605.

In August 2016, the FASB issued ASU No. 2016-15, Classification of Certain Cash Receipts and Cash Payments. This ASU reduces the diversity in reporting of eight specific cash flow issues due to accounting guidance that is unclear or does not exist. The eight issues relate to certain debt activities, business combination activities, insurance settlements and other various activities. The Company adopted this ASU as of January 1, 2018 and it did not have an impact on its consolidated financial statements.

v3.10.0.1
The Company and Summary of Significant Accounting Principles (Tables)
9 Months Ended
Sep. 30, 2018
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 September 30, 2018 and December 31, 2017, the Company had concentrations equal to or exceeding 10% of the Company’s accounts receivable as follows:

 

 

 

Accounts Receivable

 

 

 

September 30, 2018

 

 

December 31, 2017

 

Google advertising affiliate

 

*

 

 

 

16

%

Google search

 

 

7

%

 

 

7

%

Advertising customer

 

 

10

%

 

 

12

%

* - Less than 10%

 

 

 

 

 

 

 

 

 

For the three months and nine months ended September 30, 2018 and 2017, the Company had concentrations equal to or exceeding 10% of the Company’s revenue as follows:

 

 

Revenue

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2018

 

 

2017

 

 

2018

 

 

2017

 

Google search

 

 

14

%

 

 

17

%

 

 

14

%

 

 

15

%

Google advertising affiliate

 

 

10

%

 

 

22

%

 

 

12

%

 

 

19

%

 

For the three months and nine months ended September 30, 2018 and 2017, 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

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2018

 

 

2017

 

 

2018

 

 

2017

 

Customer A

 

*

 

 

 

11

%

 

*

 

 

 

13

%

Customer B

 

 

21

%

 

 

27

%

 

 

25

%

 

 

16

%

* - Less than 10%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

v3.10.0.1
Revenue from Contracts with Customers (Tables)
9 Months Ended
Sep. 30, 2018
Revenue From Contract With Customer [Abstract]  
Summary of Geographical Market and Timing of Revenue Recognition, Includes Reconciliation of Disaggregated Revenue with Reportable Types

The following table provides information about disaggregated revenue for the three and nine months ended September 30, 2018 by primary geographical market and timing of revenue recognition, and includes a reconciliation of the disaggregated revenue with reportable types (in thousands):

 

 

 

Three Months Ended September 30, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Geographic Area

 

 

 

Timing of Revenue Recognition

 

 

 

 

 

 

 

United States

 

 

International

 

 

 

Products transferred

at a point in time

 

 

Products and services

transferred over time

 

 

Total

 

 

 

(in thousands)

 

 

 

(in thousands)

 

 

 

 

 

Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Search and Digital advertising

 

$

20,592

 

 

$

618

 

 

 

$

21,210

 

 

$

 

 

$

21,210

 

Recurring and Fee-based

 

 

8,601

 

 

 

5,832

 

 

 

 

3,866

 

 

 

10,567

 

 

$

14,433

 

Total revenue

 

$

29,193

 

 

$

6,450

 

 

 

$

25,076

 

 

$

10,567

 

 

$

35,643

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended September 30, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Geographic Area

 

 

 

Timing of Revenue Recognition

 

 

 

 

 

 

 

United States

 

 

International

 

 

 

Products transferred

at a point in time

 

 

Products and services

transferred over time

 

 

Total

 

 

 

(in thousands)

 

 

 

(in thousands)

 

 

 

 

 

Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Search and Digital advertising

 

$

59,720

 

 

$

2,295

 

 

 

$

62,015

 

 

$

 

 

$

62,015

 

Recurring and Fee-based

 

 

25,865

 

 

 

16,601

 

 

 

 

10,016

 

 

 

32,450

 

 

$

42,466

 

Total revenue

 

$

85,585

 

 

$

18,896

 

 

 

$

72,031

 

 

$

32,450

 

 

$

104,481

 

 

Schedule of Changes in Deferred Revenue, Inclusive of Both Current and Long-term

The changes in deferred revenue, inclusive of both current and long-term, are as follows:

 

(in thousands)

 

 

 

Beginning balance - January 1, 2018

$

15,287

 

Record the cumulative effect of ASC 606 implementation

 

(2,456

)

Recognition of deferred revenue

 

(10,500

)

Deferral of revenue

 

7,744

 

Ending Balance - September 30, 2018

$

10,075

 

 

v3.10.0.1
Intangible Assets (Tables)
9 Months Ended
Sep. 30, 2018
Goodwill And Intangible Assets Disclosure [Abstract]  
Schedule of Intangible Assets

Intangible assets consisted of the following (in thousands):

 

 

 

September 30, 2018

 

 

December 31, 2017

 

Customer and publisher relationships

 

$

14,780

 

 

$

14,780

 

Technology

 

 

2,330

 

 

 

2,330

 

Trademark

 

 

300

 

 

 

300

 

 

 

 

17,410

 

 

 

17,410

 

Less accumulated amortization

 

 

(6,322

)

 

 

(4,715

)

Intangible assets, net

 

$

11,088

 

 

$

12,695

 

 

v3.10.0.1
Property and Equipment - Net (Tables)
9 Months Ended
Sep. 30, 2018
Property Plant And Equipment [Abstract]  
Schedule of Property and Equipment

Property and equipment, net consisted of the following (in thousands):

 

 

 

September 30, 2018

 

 

December 31, 2017

 

Computer equipment

 

$

28,997

 

 

$

28,845

 

Computer software

 

 

27,248

 

 

 

23,690

 

Furniture and fixtures

 

 

1,624

 

 

 

1,497

 

Leasehold improvements

 

 

1,258

 

 

 

1,215

 

Work in process (primarily software development costs)

 

 

4,719

 

 

 

3,758

 

Other

 

 

179

 

 

 

159

 

 

 

 

64,025

 

 

 

59,164

 

Less accumulated depreciation

 

 

(44,277

)

 

 

(38,659

)

Property and equipment, net

 

$

19,748

 

 

$

20,505

 

 

v3.10.0.1
Accrued Expenses and Other Current Liabilities (Tables)
9 Months Ended
Sep. 30, 2018
Payables And Accruals [Abstract]  
Schedule of Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consisted of the following (in thousands):

 

 

 

September 30, 2018

 

 

December 31, 2017

 

Accrued compensation

 

$

4,819

 

 

$

4,361

 

Accrued content fees and other costs of revenue

 

 

300

 

 

 

655

 

Accrued taxes

 

 

228

 

 

 

426

 

Other

 

 

1,242

 

 

 

1,633

 

Total

 

$

6,589

 

 

$

7,075

 

 

Summary of Activity in Accrued Severance Account

The below table summarizes the activity in the accrued severance account.

 

 

 

September 30, 2018

 

Balance at January 1, 2018

 

$

21

 

Charged to expense

 

 

1,034

 

Cash payments

 

 

(569

)

Balance at September 30, 2018

 

$

486

 

 

v3.10.0.1
Information About Segment and Geographic Areas (Tables)
9 Months Ended
Sep. 30, 2018
Segment Reporting [Abstract]  
Schedule of Revenue and Long Lived Tangible Assets by Geographic Area

The following tables set forth revenue and long-lived tangible assets by geographic area (in thousands):

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2018

 

 

2017

 

 

2018

 

 

2017

 

Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

United States

 

$

29,193

 

 

$

30,742

 

 

$

85,585

 

 

$

77,600

 

International

 

 

6,450

 

 

 

5,527

 

 

 

18,896

 

 

 

16,425

 

Total revenue

 

$

35,643

 

 

$

36,269

 

 

$

104,481

 

 

$

94,025

 

 

 

 

September 30, 2018

 

 

December 31, 2017

 

Long-lived tangible assets:

 

 

 

 

 

 

 

 

United States

 

$

19,175

 

 

$

19,775

 

International

 

 

573

 

 

 

730

 

Total long-lived tangible assets

 

$

19,748

 

 

$

20,505

 

 

v3.10.0.1
Commitments and Contingencies (Tables)
9 Months Ended
Sep. 30, 2018
Commitments And Contingencies Disclosure [Abstract]  
Schedule of Contract Commitments

Contract commitments as of September 30, 2018 are as follows (in thousands

 

Year ending December 31,

 

 

 

 

2018 (remaining three months)

 

$

225

 

2019

 

 

1,353

 

2020

 

 

753

 

Total

 

$

2,331

 

 

Schedule of Capital Lease Commitments

Capital lease commitments for the remainder of 2018 and for the following two years as of September 30, 2018 are summarized as follows (in thousands):

 

Years Ending December 31,

 

Capital Lease

Commitments

 

2018 (remaining three months)

 

$

748

 

2019

 

 

2,348

 

2020

 

 

1,152

 

Total minimum capital lease commitments

 

 

4,248

 

Less-amount representing interest

 

 

(204

)

Total capital lease obligations

 

 

4,044

 

Less-minimum capital lease obligations in accounts payable

 

 

-

 

Less-current portion of capital lease obligations

 

 

(2,376

)

Long-term portion of capital lease obligations

 

$

1,668

 

 

v3.10.0.1
Stock-based Compensation (Tables)
9 Months Ended
Sep. 30, 2018
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]  
Schedule of Weighted Average Assumptions Used to Estimate the Fair Value of Options Granted

The following table presents the weighted-average assumptions used to estimate the fair value of options granted during the periods indicated:

 

 

 

Nine Months Ended

 

 

Nine Months Ended

 

 

 

September 30, 2018

 

 

September 30, 2017

 

Weighted average grant date fair value

 

$

1.01

 

 

$

1.53

 

Expected dividend yield

 

 

%

 

 

%

Expected stock price volatility

 

 

48

%

 

 

47

%

Risk-free interest rate

 

 

2.7

%

 

 

2.1

%

Expected life of options (in years)

 

 

6.25

 

 

 

6.36

 

 

Schedule of Total Stock Based Compensation Expense

 

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

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2018

 

 

2017

 

 

2018

 

 

2017

 

Technology and development

 

$

101

 

 

$

190

 

 

$

369

 

 

$

604

 

Sales and marketing

 

 

110

 

 

 

142

 

 

 

374

 

 

 

500

 

General and administrative

 

 

150

 

 

 

273

 

 

 

708

 

 

 

824

 

Total stock-based compensation expense

 

$

361

 

 

$

605

 

 

$

1,451

 

 

$

1,928

 

 

Summary of Stock Option Activity

Stock Option Activity – A summary of the stock option activity for the nine months ended September 30, 2018 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, 2018

 

 

8,478,213

 

 

$

2.60

 

 

 

 

 

 

 

 

 

Granted

 

 

1,109,400

 

 

 

2.03

 

 

 

 

 

 

 

 

 

Exercised

 

 

(180,644

)

 

 

1.56

 

 

 

 

 

 

 

 

 

Forfeited or expired

 

 

(1,192,599

)

 

 

2.59

 

 

 

 

 

 

 

 

 

Outstanding at September 30, 2018

 

 

8,214,370

 

 

$

2.54

 

 

 

6.45

 

 

$

79

 

Vested and expected to vest at September 30, 2018

 

 

7,997,637

 

 

$

2.55

 

 

 

6.37

 

 

$

78

 

Vested and exercisable at September 30, 2018

 

 

5,731,815

 

 

$

2.59

 

 

 

5.48

 

 

$

57

 

 

v3.10.0.1
Net (Loss) Income Per Common Share Data (Tables)
9 Months Ended
Sep. 30, 2018
Earnings Per Share [Abstract]  
Schedule of Basic and Diluted Net (Loss) Income Per Share

The following table presents the calculation of basic and diluted net (loss) income per share for the three months and nine months ended September 30, 2018 and 2017:

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2018

 

 

2017

 

 

2018

 

 

2017

 

Basic net (loss) income per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Numerator:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income (in thousands)

 

$

(2,220

)

 

$

261

 

 

$

(7,179

)

 

$

(9,671

)

Denominator:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding

 

 

38,951,558

 

 

 

38,471,377

 

 

 

38,856,836

 

 

 

35,590,563

 

Basic net (loss) income per share

 

$

(0.06

)

 

$

0.01

 

 

$

(0.18

)

 

$

(0.27

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted net (loss) income per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Numerator:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income (in thousands)

 

$

(2,220

)

 

$

261

 

 

$

(7,179

)

 

$

(9,671

)

Denominator:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding - basic

 

 

38,951,558

 

 

 

38,471,377

 

 

 

38,856,836

 

 

 

35,590,563

 

Add - potentially dilutive securities (options, RSUs and warrants)

 

 

 

 

 

1,469,413

 

 

 

 

 

 

 

Weighted average common shares outstanding - diluted

 

 

38,951,558

 

 

 

39,940,790

 

 

 

38,856,836

 

 

 

35,590,563

 

Diluted net (loss) income per share

 

$

(0.06

)

 

$

0.01

 

 

$

(0.18

)

 

$

(0.27

)

 

Schedule of Securities Excluded from Calculation of Diluted Net Loss Per Share

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

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2018

 

 

2017

 

 

2018

 

 

2017

 

Anti-dilutive equity awards:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock options

 

 

8,214,370

 

 

 

2,330,897

 

 

 

8,214,370

 

 

 

8,706,131

 

Restricted stock units

 

 

21,846

 

 

 

62,221

 

 

 

21,846

 

 

 

127,226

 

Warrants

 

 

495,652

 

 

 

 

 

 

564,835

 

 

 

600,000

 

 

v3.10.0.1
The Company and Summary of Significant Accounting Principles - Schedule of Concentrations Equal to or Exceeding 10% of Company's Accounts Receivable, Revenue, and Cost of Revenue (Detail)
3 Months Ended 9 Months Ended 12 Months Ended
Sep. 30, 2018
Sep. 30, 2017
Sep. 30, 2018
Sep. 30, 2017
Dec. 31, 2017
Credit Concentration Risk [Member] | Accounts Receivable [Member] | Google Search [Member]          
Concentration Risk [Line Items]          
Concentration risk, percentage     7.00%   7.00%
Credit Concentration Risk [Member] | Accounts Receivable [Member] | Google Advertising Affiliate [Member]          
Concentration Risk [Line Items]          
Concentration risk, percentage         16.00%
Credit Concentration Risk [Member] | Accounts Receivable [Member] | Advertising Customer [Member]          
Concentration Risk [Line Items]          
Concentration risk, percentage     10.00%   12.00%
Product Concentration Risk [Member] | Revenue [Member] | Google Search [Member]          
Concentration Risk [Line Items]          
Concentration risk, percentage 14.00% 17.00% 14.00% 15.00%  
Product Concentration Risk [Member] | Revenue [Member] | Google Advertising Affiliate [Member]          
Concentration Risk [Line Items]          
Concentration risk, percentage 10.00% 22.00% 12.00% 19.00%  
Customer Concentration Risk | Cost of Revenue [Member] | Customer A [Member]          
Concentration Risk [Line Items]          
Concentration risk, percentage   11.00%   13.00%  
Customer Concentration Risk | Cost of Revenue [Member] | Customer B [Member]          
Concentration Risk [Line Items]          
Concentration risk, percentage 21.00% 27.00% 25.00% 16.00%  
v3.10.0.1
The Company and Summary of Significant Accounting Principles - Recently Adopted - Additional Information (Detail) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Sep. 30, 2018
Sep. 30, 2017
Sep. 30, 2018
Sep. 30, 2017
Dec. 31, 2017
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]          
Accumulated deficit $ (91,348)   $ (91,348)   $ (86,627)
Revenue 35,643 $ 36,269 104,481 $ 94,025  
ASU 2014-09 [Member] | Difference Between Revenue Guidance in Effect Before and After Topic 606 [Member]          
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]          
Accumulated deficit $ (2,500)   (2,500)    
Revenue     $ 200    
v3.10.0.1
Revenue from Contracts with Customers - Additional Information (Detail)
9 Months Ended
Sep. 30, 2018
Disaggregation Of Revenue [Line Items]  
Revenue, performance obligation, payment terms description The Company usually expects payment within 30 to 90 days from the invoice date (fulfillment of performance obligations or per contract terms).
Practical expedient, remaining performance obligation original expected length true
Minimum [Member]  
Disaggregation Of Revenue [Line Items]  
Revenue, performance obligation, payment terms 30 days
Maximum [Member]  
Disaggregation Of Revenue [Line Items]  
Revenue, performance obligation, payment terms 90 days
v3.10.0.1
Revenue from Contracts with Customers - Summary of Geographical Market and Timing of Revenue Recognition, Includes Reconciliation of Disaggregated Revenue with Reportable Types (Detail) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Sep. 30, 2018
Sep. 30, 2018
Disaggregation Of Revenue [Line Items]    
Total revenue $ 35,643 $ 104,481
Search and Digital Advertising [Member]    
Disaggregation Of Revenue [Line Items]    
Total revenue 21,210 62,015
Recurring and Fee-Based [Member]    
Disaggregation Of Revenue [Line Items]    
Total revenue 14,433 42,466
Products Transferred at a Point in Time [Member]    
Disaggregation Of Revenue [Line Items]    
Total revenue 25,076 72,031
Products Transferred at a Point in Time [Member] | Search and Digital Advertising [Member]    
Disaggregation Of Revenue [Line Items]    
Total revenue 21,210 62,015
Products Transferred at a Point in Time [Member] | Recurring and Fee-Based [Member]    
Disaggregation Of Revenue [Line Items]    
Total revenue 3,866 10,016
Products and Services Transferred Over Time [Member]    
Disaggregation Of Revenue [Line Items]    
Total revenue 10,567 32,450
Products and Services Transferred Over Time [Member] | Recurring and Fee-Based [Member]    
Disaggregation Of Revenue [Line Items]    
Total revenue 10,567 32,450
United States [Member]    
Disaggregation Of Revenue [Line Items]    
Total revenue 29,193 85,585
United States [Member] | Search and Digital Advertising [Member]    
Disaggregation Of Revenue [Line Items]    
Total revenue 20,592 59,720
United States [Member] | Recurring and Fee-Based [Member]    
Disaggregation Of Revenue [Line Items]    
Total revenue 8,601 25,865
International [Member]    
Disaggregation Of Revenue [Line Items]    
Total revenue 6,450 18,896
International [Member] | Search and Digital Advertising [Member]    
Disaggregation Of Revenue [Line Items]    
Total revenue 618 2,295
International [Member] | Recurring and Fee-Based [Member]    
Disaggregation Of Revenue [Line Items]    
Total revenue $ 5,832 $ 16,601
v3.10.0.1
Revenue from Contracts with Customers - Schedule of Changes in Deferred Revenue, Inclusive of Both Current and Long-term (Detail)
$ in Thousands
9 Months Ended
Sep. 30, 2018
USD ($)
Contract With Customer Liability [Line Items]  
Beginning balance - January 1, 2018 $ 15,287
Recognition of deferred revenue (10,500)
Deferral of revenue 7,744
Ending Balance - September 30, 2018 10,075
ASC 606 [Member]  
Contract With Customer Liability [Line Items]  
Record the cumulative effect of ASC 606 implementation $ (2,456)
v3.10.0.1
Revenue from Contracts with Customers - Remaining Performance Obligations - Additional Information (Detail)
Sep. 30, 2018
Maintenance and Support Contracts for Email Software Licenses [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2018-10-01  
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items]  
Revenue, remaining performance obligation, expected timing of satisfaction, period 12 months
v3.10.0.1
Acquisitions - Additional Information (Detail) - USD ($)
1 Months Ended 9 Months Ended
May 31, 2017
Nov. 30, 2016
Aug. 31, 2015
Sep. 30, 2018
Dec. 31, 2016
Feb. 19, 2016
TZ Holdings, Inc [Member]            
Business Acquisition [Line Items]            
Cash consideration     $ 17,300,000      
Business acquisition hold back, value     800,000      
Held back warrants expiration date       Sep. 14, 2018    
Maximum contingent cash consideration     2,000,000      
Contingent consideration at fair value     $ 1,600,000      
Contingent consideration paid $ 700,000 $ 900,000        
Technorati [Member]            
Business Acquisition [Line Items]            
Cash withheld to secure indemnification obligations           $ 500,000
Approximately owed, post closing working capital adjustments         $ 100,000  
Common Stock [Member] | TZ Holdings, Inc [Member]            
Business Acquisition [Line Items]            
Business acquisition equity Interest Issued, number of Shares     2,400,000      
Business acquisition equity Interest Issued, value     $ 3,200,000      
Number of shares held back     600,000      
Warrants [Member] | TZ Holdings, Inc [Member]            
Business Acquisition [Line Items]            
Business acquisition equity Interest Issued, number of Shares     480,000      
Number of shares held back     120,000      
v3.10.0.1
Intangible Assets - Schedule of Intangible Assets (Detail) - USD ($)
$ in Thousands
Sep. 30, 2018
Dec. 31, 2017
Finite-Lived Intangible Assets [Line Items]    
Total gross amortizable intangible assets $ 17,410 $ 17,410
Less accumulated amortization (6,322) (4,715)
Intangible assets, net 11,088 12,695
Customer and Publisher Relationships [Member]    
Finite-Lived Intangible Assets [Line Items]    
Total gross amortizable intangible assets 14,780 14,780
Technology [Member]    
Finite-Lived Intangible Assets [Line Items]    
Total gross amortizable intangible assets 2,330 2,330
Trademark [Member]    
Finite-Lived Intangible Assets [Line Items]    
Total gross amortizable intangible assets $ 300 $ 300
v3.10.0.1
Intangible Assets - Additional Information (Detail) - USD ($)
$ in Millions
3 Months Ended 9 Months Ended
Sep. 30, 2018
Sep. 30, 2017
Sep. 30, 2018
Sep. 30, 2017
Intangible Liability Disclosure [Abstract]        
Amortization of intangible assets $ 0.5 $ 0.5 $ 1.6 $ 1.6
v3.10.0.1
Property and Equipment - Net - Schedule of Property and Equipment (Detail) - USD ($)
$ in Thousands
Sep. 30, 2018
Dec. 31, 2017
Property, Plant and Equipment [Line Items]    
Property and equipment gross $ 64,025 $ 59,164
Less accumulated depreciation (44,277) (38,659)
Property and equipment, net 19,748 20,505
Computer Equipment [Member]    
Property, Plant and Equipment [Line Items]    
Property and equipment gross 28,997 28,845
Computer Software [Member]    
Property, Plant and Equipment [Line Items]    
Property and equipment gross 27,248 23,690
Furniture and Fixtures [Member]    
Property, Plant and Equipment [Line Items]    
Property and equipment gross 1,624 1,497
Leasehold Improvements [Member]    
Property, Plant and Equipment [Line Items]    
Property and equipment gross 1,258 1,215
Work in Process [Member]    
Property, Plant and Equipment [Line Items]    
Property and equipment gross 4,719 3,758
Other [Member]    
Property, Plant and Equipment [Line Items]    
Property and equipment gross $ 179 $ 159
v3.10.0.1
Property and Equipment - Net - Additional Information (Detail) - USD ($)
$ in Millions
3 Months Ended 9 Months Ended
Sep. 30, 2018
Sep. 30, 2017
Sep. 30, 2018
Sep. 30, 2017
Property Plant And Equipment [Abstract]        
Depreciation expense $ 1.9 $ 2.1 $ 5.7 $ 5.4
v3.10.0.1
Accrued Expenses and Other Current Liabilities - Schedule of Accrued Expenses and Other Current Liabilities (Detail) - USD ($)
$ in Thousands
Sep. 30, 2018
Dec. 31, 2017
Accounts Payable And Accrued Liabilities Current [Abstract]    
Accrued compensation $ 4,819 $ 4,361
Accrued content fees and other costs of revenue 300 655
Accrued taxes 228 426
Other 1,242 1,633
Total $ 6,589 $ 7,075
v3.10.0.1
Accrued Expenses and Other Current Liabilities - Additional Information (Detail)
$ in Millions
9 Months Ended
Sep. 30, 2018
USD ($)
Sales and Marketing Expenses [Member]  
Accrued Expenses And Other Current Liabilities [Line Items]  
Severance costs $ 0.3
General and Administrative Expenses [Member]  
Accrued Expenses And Other Current Liabilities [Line Items]  
Severance costs 0.4
Technology and Development [Member]  
Accrued Expenses And Other Current Liabilities [Line Items]  
Severance costs $ 0.3
v3.10.0.1
Accrued Expenses and Other Current Liabilities - Summary of Activity in Accrued Severance Account (Detail)
$ in Thousands
9 Months Ended
Sep. 30, 2018
USD ($)
Accounts Payable And Accrued Liabilities Current [Abstract]  
Balance at January 1, 2018 $ 21
Charged to expense 1,034
Cash payments (569)
Balance at September 30, 2018 $ 486
v3.10.0.1
Information About Segment and Geographic Areas - Schedule of Revenue and Long Lived Tangible Assets by Geographic Area (Detail) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Sep. 30, 2018
Sep. 30, 2017
Sep. 30, 2018
Sep. 30, 2017
Dec. 31, 2017
Revenues from External Customers and Long-Lived Assets [Line Items]          
REVENUE $ 35,643 $ 36,269 $ 104,481 $ 94,025  
Long-lived tangible assets 19,748   19,748   $ 20,505
United States [Member]          
Revenues from External Customers and Long-Lived Assets [Line Items]          
REVENUE 29,193 30,742 85,585 77,600  
Long-lived tangible assets 19,175   19,175   19,775
International [Member]          
Revenues from External Customers and Long-Lived Assets [Line Items]          
REVENUE 6,450 $ 5,527 18,896 $ 16,425  
Long-lived tangible assets $ 573   $ 573   $ 730
v3.10.0.1
Commitments and Contingencies - Schedule of Contract Commitments (Detail)
$ in Thousands
Sep. 30, 2018
USD ($)
Contractual Obligation, Fiscal Year Maturity [Abstract]  
2018 (remaining three months) $ 225
2019 1,353
2020 753
Total $ 2,331
v3.10.0.1
Commitments and Contingencies - Schedule of Capital Lease Commitments (Detail) - USD ($)
$ in Thousands
Sep. 30, 2018
Dec. 31, 2017
Capital Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract]    
2018 (remaining three months) $ 748  
2019 2,348  
2020 1,152  
Total minimum capital lease commitments 4,248  
Less-amount representing interest (204)  
Total capital lease obligations 4,044  
Less-current portion of capital lease obligations (2,376) $ (2,444)
Long-term portion of capital lease obligations $ 1,668 $ 3,371
v3.10.0.1
Commitments and Contingencies - Additional Information (Detail) - Pending Litigation
$ in Millions
9 Months Ended
Sep. 30, 2018
USD ($)
Loss Contingencies [Line Items]  
Lost potential value $ 15.0
Loss contingency name of Plaintiff Maxit
Lost potential value assessed $ 0.6
Lost potential value reserved, description Maxit alleges that its share of the lost potential value is approximately $15 million. Based in part on an independent appraisal, the Company assessed the lost potential value at only $0.6 million, for which half of this amount (based on 50/50 ownership) has been reserved in its financial statements.
v3.10.0.1
Stock-based Compensation - Schedule of Weighted Average Assumptions Used to Estimate the Fair Value of Options Granted (Detail) - $ / shares
9 Months Ended
Sep. 30, 2018
Sep. 30, 2017
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]    
Weighted average grant date fair value $ 1.01 $ 1.53
Expected stock price volatility 48.00% 47.00%
Risk-free interest rate 2.70% 2.10%
Expected life of options (in years) 6 years 3 months 6 years 4 months 9 days
v3.10.0.1
Stock-based Compensation - Schedule of Total Stock Based Compensation Expense (Detail) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Sep. 30, 2018
Sep. 30, 2017
Sep. 30, 2018
Sep. 30, 2017
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]        
Total stock-based compensation expense $ 361 $ 605 $ 1,451 $ 1,928
Technology and Development [Member]        
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]        
Total stock-based compensation expense 101 190 369 604
Sales and Marketing [Member]        
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]        
Total stock-based compensation expense 110 142 374 500
General and Administrative [Member]        
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]        
Total stock-based compensation expense $ 150 $ 273 $ 708 $ 824
v3.10.0.1
Stock-based Compensation - Summary of Stock Option Activity (Detail)
$ / shares in Units, $ in Thousands
9 Months Ended
Sep. 30, 2018
USD ($)
$ / shares
shares
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]  
Outstanding number of shares, beginning balance | shares 8,478,213
Number of shares, granted | shares 1,109,400
Number of shares, exercised | shares (180,644)
Number of shares, forfeited or expired | shares (1,192,599)
Outstanding number of shares, ending balance | shares 8,214,370
Outstanding number of shares vested and expected to vest | shares 7,997,637
Outstanding number of shares vested and exercisable | shares 5,731,815
Outstanding, weighted average exercise price, beginning balance | $ / shares $ 2.60
Weighted average exercise price, granted | $ / shares 2.03
Weighted average exercise price, exercised | $ / shares 1.56
Weighted average exercise price, forfeited or expired | $ / shares 2.59
Outstanding, weighted average exercise price, ending balance | $ / shares 2.54
Vested and expected to vest, weighted average exercise price, ending balance | $ / shares 2.55
Vested and exercisable, weighted average exercise price, ending balance | $ / shares $ 2.59
Weighted average remaining contractual term (in years), outstanding 6 years 5 months 12 days
Weighted average remaining contractual term (in years), vested and expected to vest 6 years 4 months 13 days
Weighted average remaining contractual term (in years), vested and exercisable 5 years 5 months 23 days
Aggregate intrinsic value, outstanding | $ $ 79
Aggregate intrinsic value, vested and expected to vest | $ 78
Aggregate intrinsic value, vested and exercisable | $ $ 57
v3.10.0.1
Stock-based Compensation - Additional Information (Detail) - USD ($)
$ / shares in Units, $ in Millions
9 Months Ended
Sep. 30, 2018
Sep. 30, 2017
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]    
Closing stock price as reported on the Nasdaq Global Market $ 1.60  
Weighted average fair value of options granted $ 1.01 $ 1.53
Unrecognized compensation cost related to options granted after adjustment for estimated forfeitures $ 2.8  
Expected weighted average remaining period to recognize total unrecognized compensation cost 2 years 7 months 6 days  
v3.10.0.1
Net (Loss) Income Per Common Share Data - Schedule of Basic and Diluted Net (Loss) Income Per Share (Detail) - USD ($)
$ / shares in Units, $ in Thousands
3 Months Ended 9 Months Ended
Sep. 30, 2018
Sep. 30, 2017
Sep. 30, 2018
Sep. 30, 2017
Numerator:        
Net (loss) income (in thousands) $ (2,220) $ 261 $ (7,179) $ (9,671)
Denominator:        
Weighted average common shares outstanding 38,951,558 38,471,377 38,856,836 35,590,563
Basic net (loss) income per share $ (0.06) $ 0.01 $ (0.18) $ (0.27)
Numerator:        
Net (loss) income (in thousands) $ (2,220) $ 261 $ (7,179) $ (9,671)
Denominator:        
Weighted average common shares outstanding - basic 38,951,558 38,471,377 38,856,836 35,590,563
Add - potentially dilutive securities (options, RSUs and warrants)   1,469,413    
Weighted average common shares outstanding - diluted 38,951,558 39,940,790 38,856,836 35,590,563
Diluted net (loss) income per share $ (0.06) $ 0.01 $ (0.18) $ (0.27)
v3.10.0.1
Net (Loss) Income Per Common Share Data - Schedule of Securities Excluded from Calculation of Diluted Net Loss Per Share (Detail) - shares
3 Months Ended 9 Months Ended
Sep. 30, 2018
Sep. 30, 2017
Sep. 30, 2018
Sep. 30, 2017
Stock Options [Member]        
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]        
Anti-dilutive equity awards 8,214,370 2,330,897 8,214,370 8,706,131
Restricted Stock Units [Member]        
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]        
Anti-dilutive equity awards 21,846 62,221 21,846 127,226
Warrants [Member]        
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]        
Anti-dilutive equity awards 495,652   564,835 600,000