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What changed in DoubleVerify Holdings, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of DoubleVerify Holdings, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+308 added−321 removedSource: 10-K (2025-02-27) vs 10-K (2024-02-28)

Top changes in DoubleVerify Holdings, Inc.'s 2024 10-K

308 paragraphs added · 321 removed · 251 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeOur sales professionals are responsible for driving the overall commercial strategy, establishing early connections and maintaining relationships with large, blue-chip brands and global advertising agencies and expanding our existing customer relationships. Our customer support team handles all aspects of customer relationships from pre-sale technical support to client onboarding, training and implementation of our solutions.
Biggest changeWe regularly seek to expand into new geographies based on demand from existing customers and the attractiveness of the potential market opportunity. 12 Table of Contents Our sales professionals are responsible for driving the overall commercial strategy, establishing early connections and maintaining relationships with large, blue-chip brands and global advertising agencies and expanding our existing customer relationships.
In addition, we obtain third party security assessments and audits of our infrastructure and security. 14 Table of Contents ● Reliable, Scalable and Redundant Infrastructure : We operate a global proprietary and redundant infrastructure that is highly available, fault tolerant and capital efficient. Certifications and Accreditations Digital advertising measurement is subject to numerous governing industry standards, guidelines and best practices.
In addition, we obtain third party security assessments and audits of our infrastructure and security. ● Reliable, Scalable and Redundant Infrastructure : We operate a global proprietary and redundant infrastructure that is highly available, fault tolerant and capital efficient. 14 Table of Contents Certifications and Accreditations Digital advertising measurement is subject to numerous governing industry standards, guidelines and best practices.
Investing in our people We believe inclusive benefits are a critical part of delivering an exceptional employee experience for our people. Therefore, we offer a competitive compensation and benefits program that supports our employees’ physical, mental, and financial health.
Investing in our people We believe benefits are a critical part of delivering an exceptional employee experience for our people. Therefore, we offer a competitive compensation and benefits program that supports our employees’ physical, mental, and financial health.
We believe the principal competitive factors in our market include the following: ● the ability to provide an independent, unified and consistent MRC-accredited measurement of digital ads across all formats and channels; ● the ability to provide accurate and reliable data insights on the brand suitability, existence of fraud and viewability of each digital ad to ensure that it meets all of these criteria; ● the ability to innovate and adapt product offerings to emerging digital media technologies and offer products that meet changing customer needs; ● the ability to support large, global customers and develop and maintain complex integrations with key partners across the digital advertising ecosystem; ● the ability to achieve and maintain industry accreditations; and ● the ability to collect this data across all key platforms and provide independent analytics to our customers.
We believe the principal competitive factors in our market include the following: ● the ability to provide an independent, unified and consistent MRC-accredited measurement of digital ads across all formats and channels; ● the ability to provide accurate and reliable data insights on the brand suitability, existence of fraud and viewability of each digital ad to ensure that it meets all of these criteria; 15 Table of Contents ● the ability to innovate and adapt product offerings to emerging digital media technologies and offer products that meet changing customer needs; ● the ability to support large, global customers and develop and maintain complex integrations with key partners across the digital advertising ecosystem; ● the ability to achieve and maintain industry accreditations; and ● the ability to collect this data across all key platforms and provide independent analytics to our customers.
We also analyze more than 17 billion digital ad transactions daily, measuring whether ads are delivered in a fraud-free, brand-suitable environment and are fully viewable in the intended geography. Our software platform and unique position in the advertising ecosystem allows us to develop a significant data asset that accumulates over time as we measure an increasing number of media transactions.
We also analyze more than 21 billion digital ad transactions daily, measuring whether ads are delivered in a fraud-free, brand-suitable environment and are fully viewable in the intended geography. Our software platform and unique position in the advertising ecosystem allows us to develop a significant data asset that accumulates over time as we measure an increasing number of media transactions.
Additionally, as device manufacturers and walled garden platforms aggressively move to curtail the use of cookie-based data collection across their properties, measurement, advertising solutions that are not based on these tracking and collection tools will benefit. Our core software platform does not rely on third-party cookies, persistent identifiers or cross-site tracking technology to deliver our measurement and analytics solutions.
Additionally, as device manufacturers and walled garden platforms move to curtail the use of cookie-based data collection across their properties, measurement, advertising solutions that are not based on these tracking and collection tools will benefit. Our core software does not rely on third-party cookies, persistent identifiers or cross-site tracking technology to deliver our measurement and analytics solutions.
In addition to locations in which we currently have a remote or contracted workforce, we serve our customers globally through our offices or commercial operations in 30 locations across 24 countries, including the United States, the United Kingdom, Israel, Singapore, Australia, Brazil, Germany and the United Arab Emirates. 6 Table of Contents We generate revenue from our advertising customers based on the volume of media transactions, or ads, that our software platform measures (“Media Transactions Measured”), for which we receive an analysis fee (“Measured Transaction Fee”), enabling us to grow as our customers increase their digital ad spend and as we integrate into new channels and platforms.
In addition to locations in which we currently have a remote or contracted workforce, we serve our customers globally through our offices or commercial operations in 31 locations across 25 countries, including the United States, the United Kingdom, Israel, Singapore, Australia, Brazil, Germany and the United Arab Emirates. 6 Table of Contents We generate revenue from our advertising customers based on the volume of media transactions, or ads, that our software platform measures (“Media Transactions Measured”), for which we receive an analysis fee (“Measured Transaction Fee”), enabling us to grow as our customers increase their digital ad spend and as we integrate into new channels and platforms.
These settings are then automatically uploaded into our customers’ programmatic platforms for complete synchronicity between their pre bid and post purchase measurement settings. 11 Table of Contents Analytics : DV Pinnacle enables advertisers to gain a clear understanding of the quality and effectiveness of their digital media campaigns and allows them to take appropriate actions for campaign optimization.
These settings are then automatically uploaded into our customers’ programmatic platforms for complete synchronicity between their pre bid and post purchase measurement settings. Analytics : DV Pinnacle enables advertisers to gain a clear understanding of the quality and effectiveness of their digital media campaigns and allows them to take appropriate actions for campaign optimization.
Our unique data analytics are used by our advertiser customers to target the highest performing ad inventory and receive refunds or credits for digital ads that do not meet certain criteria.
Our unique data analytics are used by our advertiser customers to identify the highest performing ad inventory and receive refunds or credits for digital ads that do not meet certain criteria.
The strength of our solutions attracts new customers which increases the ad transactions we measure and data we collect, further strengthening the value of our network. 8 Table of Contents Compelling Value Proposition Driving High Customer ROI . We enable our customers to optimize return on their marketing investments for a fraction of the underlying media cost.
The strength of our solutions attracts new customers which increases the ad transactions we measure and data we collect, further strengthening the value of our network. Compelling Value Proposition Driving High Customer ROI . We enable our customers to optimize return on their marketing investments for a fraction of the underlying media cost.
The proliferation of digital channels, formats and devices has made it more difficult for advertisers to measure campaign performance across all platforms. This measurement has been further complicated by recent moves by some large device manufacturers and certain closed platforms, which are often referred to as “walled gardens,” to restrict cookie and identifier-based data sharing.
The proliferation of digital channels, formats and devices has made it more difficult for advertisers to measure campaign performance across all platforms. This measurement has been further complicated by recent moves by some large device manufacturers and certain closed platforms, which are often referred to as “walled gardens,” to restrict (or announce restrictions on) cookie and identifier-based data sharing.
In addition, our solutions help our customers preserve one of their most important and invaluable assets — brand reputation — by ensuring ads are not shown near content that is inconsistent with their brand message. Track Record of Successful Product Innovation .
In addition, our solutions help our customers preserve one of their most important and invaluable assets — brand reputation — by ensuring ads are not shown near content that is inconsistent with their brand message. 8 Table of Contents Track Record of Successful Product Innovation .
Scibids AI technology does not rely on digital identifiers such as cookies and can be activated across leading Demand-Side Platforms, such as The Trade Desk, DV360, and Xandr. Supply-Side Solutions We provide our software solutions and data analytics to publishers and other supply-side customers to enable them to maximize revenue from their digital advertising inventory.
Scibids AI technology does not rely on digital identifiers such as cookies and can be activated across leading Demand-Side Platforms, such as The Trade Desk, DV360, and Xandr. 10 Table of Contents Supply-Side Solutions We provide our software solutions and data analytics to publishers and other supply-side customers to enable them to maximize revenue from their digital advertising inventory.
Rapid advancement of our product capabilities has enabled our business to meet customer needs in the dynamic digital advertising landscape. Through our innovation, we have been able to continuously add new capabilities to our solutions. Our engineering team, consisting of 297 employees as of December 31, 2023, is responsible for the development of software and the operations of our infrastructure.
Rapid advancement of our product capabilities has enabled our business to meet customer needs in the dynamic digital advertising landscape. Through our innovation, we have been able to continuously add new capabilities to our solutions. Our engineering team, consisting of 339 employees as of December 31, 2024, is responsible for the development of software and the operations of our infrastructure.
We also offer Authentic Brand Suitability, which is an enhanced set of contextual targeting solutions that can be deployed across multiple programmatic platforms. ● Viewability : Digital ads are frequently obscured, paused before fully delivered or placed in locations that are out of view from the intended recipient.
We also offer Authentic Brand Suitability, which is an enhanced set of contextual solutions that can be deployed across multiple programmatic platforms. 9 Table of Contents ● Viewability : Digital ads are frequently obscured, paused before fully delivered or placed in locations that are out of view from the intended recipient.
The significant growth in digital advertising has resulted in wasted ad spend due to ads that are never seen as a result of continually evolving ad fraud activities, including bots, fake clicks and fraudulent web sites. New and sophisticated schemes, particularly across emerging channels such as CTV and mobile in-app, are uncovered each day.
Media quality is foundational to performance. The significant growth in digital advertising has resulted in wasted ad spend due to ads that are never seen as a result of continually evolving ad fraud activities, including bots, fake clicks and fraudulent web sites. New and sophisticated schemes, particularly across emerging channels such as CTV and mobile in-app, are uncovered each day.
Each day, we identify over 15 million active fraudulent device signatures, distributing them to our partners nearly 100 times per day. 9 Table of Contents ● Brand Safety and Suitability : Our customers use the data analytics that our software platform provides to target desired contexts and help prevent their ads from appearing next to content that they do not deem appropriate for their brands.
Each day, we identify over 16 million active fraudulent device signatures, distributing them to our partners nearly 100 times per day. ● Brand Safety and Suitability : Our customers use the data analytics that our software platform provides to target desired contexts and help prevent their ads from appearing next to content that they do not deem appropriate for their brands.
The expansive coverage of our certifications and accreditations across metrics, standards, devices and regions represents a significant expenditure of capital and years of auditing that can be difficult for new market entrants to obtain. 15 Table of Contents Competition We operate in a competitive end market with multiple different types of competitors.
The expansive coverage of our certifications and accreditations across metrics, standards, devices and regions represents a significant expenditure of capital and years of auditing that can be difficult for new market entrants to obtain. Competition We operate in an evolving, competitive end market with multiple different types of competitors.
With this foundation, we were able to drive net revenue retention of 124% in 2023, 127% in 2022 and 126% in 2021 through increased advertising volume and the successful launch of newly-introduced solutions. Scaled and Profitable Business Model .
With this foundation, we were able to drive net revenue retention of 112% in 2024, 124% in 2023 and 127% in 2022 through increased advertising volume and the successful launch of newly-introduced solutions. Scaled and Profitable Business Model .
Our product team, consisting of 175 employees as of December 31, 2023, is responsible for working with our sales, account management, marketing and business development teams to understand customer input, assess the market opportunity and define the product roadmap.
Our product team, consisting of 197 employees as of December 31, 2024, is responsible for working with our sales, account management, marketing and business development teams to understand customer input, assess the market opportunity and define the product roadmap.
In 2023, we had 93 customers who each represented at least $1 million of annual revenue, up from 78 such customers in 2022 and 64 such customers in 2021, with no customer representing more than 10% of our revenue in 2023, 2022 or 2021.
In 2024, we had 110 customers who each represented at least $1 million of annual revenue, up from 93 such customers in 2023 and 78 such customers in 2022, with no customer representing more than 10% of our revenue in 2024, 2023 or 2022.
We serve over 1,800 customers that are diversified across all major industry verticals, including consumer packaged goods, financial services, telecommunications, technology, automotive and healthcare.
We serve over 2,000 customers that are diversified across all major industry verticals, including consumer packaged goods, financial services, telecommunications, technology, automotive and healthcare.
We collected and analyzed data points on the approximately 7.0 trillion Media Transactions Measured (as defined below) by us in 2023, up from 5.5 trillion Media Transactions Measured in 2022 and 4.5 trillion in 2021.
We collected and analyzed data points on the approximately 8.3 trillion Media Transactions Measured (as defined below) by us in 2024, up from 7.0 trillion Media Transactions Measured in 2023 and 5.5 trillion in 2022.
Our sales, marketing and customer support expenses were $126.0 million, $107.4 million and $77.3 million for each of the years ended December 31, 2023, December 31, 2022 and December 31, 2021. Product Development Ongoing product innovation is central to our business.
Our sales, marketing and customer support expenses were $167.5 million, $126.0 million and $107.4 million for each of the years ended December 31, 2024, December 31, 2023 and December 31, 2022. Product Development Ongoing product innovation is central to our business.
We are also able to increase revenue per customer as we introduce new solutions, which has resulted in a compounded annual growth rate in average revenue for our top 100 customers of 28% from 2020 to 2023.
We are also able to increase revenue per customer as we introduce new solutions, which has resulted in a compounded annual growth rate in average revenue for our top 100 customers of 24% from 2021 to 2024.
We believe our solutions are difficult to replicate and we will continue to enhance our intellectual property portfolio as we develop new solutions for our customers. 16 Table of Contents We have two registered U.S. patents, five international patents (three in Europe and two in Japan) and five pending patent applications.
We believe our solutions are difficult to replicate and we will continue to enhance our intellectual property portfolio as we develop new solutions for our customers. We have three registered U.S. patents, six international patents (four in Europe and two in Japan) and four pending patent applications.
Our customers currently include over 50 of the top 100 global advertisers, according to Ad Age. In each of the years 2021-2023, we maintained over 95% gross revenue retention rates across our customer base and retained 100% of our top 75 customers.
Loyal and Growing Customer Base . Our customers currently include a majority of the top 100 global advertisers, according to Ad Age. In each of the years 2022-2024, we maintained over 95% gross revenue retention rates across our customer base and retained 100% of our top 75 customers.
We have identified nearly 20,000 fraudulent CTV/mobile apps as of December 31, 2023. In addition, even when an ad is verified to be fraud- free, there is no certainty that it is actually viewable.
We have identified over 20,000 fraudulent CTV/mobile apps as of December 31, 2024. In addition, even when an ad is verified to be fraud-free, there is no certainty that it is actually viewable or aligned with a brand’s standards.
We also hold various service marks, trademarks and trade names, including DoubleVerify, our logo design, DV Authentic Ad, DV Authentic Attention, DV Pinnacle, Authentic Brand Safety and Authentic Brand Suitability, that we deem important to our business.
We also hold various service marks, trademarks and trade names, including DoubleVerify, our logo design, DV Authentic Ad, DV Authentic Attention, DV Pinnacle, Authentic Brand Safety and Authentic Brand Suitability, that we deem important to our business. We have over 20 registered U.S. trademarks and approximately 15 trademarks that we have registered in various jurisdictions abroad.
Japan, Magnite, Teads, Epsilon, Nexxen, LG Ads ● Ad Servers and Ratings/Workflow Platforms : Innovid, Google and MediaOcean Prisma ● Social Platforms : Facebook, Instagram, YouTube, Twitter, Snapchat, Pinterest, TikTok ● CTV : Amazon, Netflix, Disney+, Hulu and Roku Our advertising customers often purchase the Company’s solutions through a Demand-Side Platform.
Select integration and channel partners include: ● Demand-Side Platforms : Amazon, Google, The Trade Desk, Yahoo, Nexxen, Infillion, Adobe, Xandr ● Ad Platforms and Exchanges : Line Yahoo, Magnite, Teads, Epsilon, Nexxen, LG Ads, Taboola, Criteo ● Ad Servers and Ratings/Workflow Platforms : Innovid, Google and MediaOcean Prisma ● Social Platforms : Facebook, Instagram, YouTube, X (formerly Twitter), Snapchat, Pinterest, TikTok ● CTV : Amazon, Netflix, Disney+, Hulu and Roku Our advertising customers often purchase the Company’s solutions through a Demand-Side Platform.
In addition, as part of our ongoing commitment to privacy compliance and data governance, we are the only major digital ad verification provider to achieve certifications for EU-U.S. focused International Privacy Verification (IPV), Asia-Pacific Economic Cooperation (APEC) Cross Border Privacy Rules (CBPR), and Privacy Recognition for Processors (PRP) through TrustArc.
In addition, as part of our ongoing commitment to privacy compliance and data governance, we are the only major digital ad verification provider to achieve certifications for Asia-Pacific Economic Cooperation (APEC) Cross Border Privacy Rules (CBPR), and Privacy Recognition for Processors (PRP) through TrustArc. In 2022, we also achieved ISO 27001:2013 certification for our information security management system.
Custom Contextual enables advertisers to target audiences based on key points of interest even in web browsers and operating systems that have phased out or ended the use of third-party tracking technology, and also positions them to align with existing privacy regulations. 10 Table of Contents Scibids AI In August 2023, we acquired Scibids Technology SAS (“Scibids”), a global leader in AI-powered digital campaign optimization.
Custom Contextual enables advertisers to target audiences based on key points of interest even in web browsers and operating systems that have phased out or ended the use of third-party tracking technology, and also positions them to align with existing privacy regulations.
As of December 31, 2023, we had 448 professionals on our Commercial organization teams, of which 174 were sales professionals, 55 were marketing professionals and 219 were account managers and customer support representatives.
As of December 31, 2024, we had 506 professionals on our Commercial organization teams, of which 214 were sales professionals, 53 were marketing professionals and 239 were account managers and customer support representatives.
Magna Global estimated that global digital ad spend, excluding search, reached over $280 billion in 2023 and is expected to grow to $386 billion by 2027. We believe the shift towards digital spend will continue as new distribution channels and advertising formats emerge that enable advertisers to more effectively reach their target audiences. Acceleration of Programmatic Ad Buying .
We believe the shift towards digital spend will continue as new distribution channels and advertising formats emerge that enable advertisers to more effectively reach their target audiences. Acceleration of Programmatic Ad Buying .
We embrace a flexible hybrid work model, enabling our employees to split time between working from the office and working from home.
We embrace a flexible hybrid work model, enabling our employees to split time between working from the office and working from home. Regulatory Matters U.S. and international data security and privacy laws apply to our business.
Account managers work closely with product managers to provide direct customer feedback, which is also shared with our technology and development organization, enabling them to implement ongoing improvements and identify potential new product categories.
Our customer support team handles all aspects of customer relationships from pre-sale technical support to client onboarding, training and implementation of our solutions. Account managers work closely with product managers to provide direct customer feedback, which is also shared with our technology and development organization, enabling them to implement ongoing improvements and identify potential new product categories.
We are accredited by the MRC for our impression measurement solutions, including fraud, brand safety and suitability, display viewability and video viewability, and our proprietary metric, the DV Authentic Ad. In late 2020, we were the first third-party solution to gain MRC accreditation for integrated viewability measurement on Facebook.
We are accredited by the MRC for our impression measurement solutions, including fraud, brand safety and suitability, display viewability and video viewability, and our proprietary metric, the DV Authentic Ad.
Our flexible technology ensures that new campaigns and configurations are distributed across our global infrastructure in minutes. ● Omni-Channel Display and Video Measurement Tags : We have built video and display measurement tags that seamlessly operate in any format or device, enabling simple tagging processes that minimize customer trafficking needs. ● Advanced Owned & Operated Semantic Science Technology : Our owned and operated semantic science technology provides accurate and granular content classifications using machine learning and an ontology of over 180,000 distinct content topics. ● Deterministic, Cross-Channel Fraud and Invalid Traffic Identification : We operate multiple proprietary fraud and invalid traffic detection models that benefit from the scale of the ads we analyze on a daily basis.
Our flexible technology ensures that new campaigns and configurations are distributed across our global infrastructure in minutes. 13 Table of Contents ● Omni-Channel Display and Video Measurement Tags : We have built video and display measurement tags that seamlessly operate in any format or device, enabling simple tagging processes that minimize customer trafficking needs. ● Advanced Owned & Operated Semantic Science Technology : Our owned and operated semantic science technology provides accurate and granular content classifications using machine learning and an ontology of over 180,000 distinct content topics. ● AI Driven Classification: Universal Content Intelligence is our content classification engine that powers expansive content categorization online based on policy definitions and AI technology.
Because our advertiser customers obtain control of the Company’s solutions to inform their purchasing decision, rather than the programmatic partners providing access to the Demand-Side Platform, the Company records revenue for the gross amounts paid by its advertiser customers for these Company-provided solutions, and the amounts retained by the programmatic partners are recorded by the Company as a cost of sales. 12 Table of Contents Sales, Marketing and Customer Support Our go-to-market strategy for new customers is focused on driving awareness for our solutions, and fostering relationships with senior brand executives and Chief Marketing Officers of leading brands, agencies and publishers.
Because our advertiser customers obtain control of the Company’s solutions to inform their purchasing decision, rather than the programmatic partners providing access to the Demand-Side Platform, the Company records revenue for the gross amounts paid by its advertiser customers for these Company-provided solutions, and the amounts retained by the programmatic partners are recorded by the Company as a cost of sales.
DV Pinnacle generates industry benchmarks that are dynamically refreshed enabling customers to compare the quality of their ads against their peers and allows users to set specific thresholds on key performance indicators that drive success of the media campaign, such as blocking rates, ad delivery and viewability.
DV Pinnacle generates industry benchmarks that are dynamically refreshed enabling customers to compare the quality of their ads against their peers and allows users to set specific thresholds on key performance indicators that drive success of the media campaign, such as blocking rates, ad delivery and viewability. 11 Table of Contents Integration and Channel Partnerships Our technology is integrated with leading digital advertising technology channels, supporting the distribution of our programmatic solutions and enabling us to analyze a broad footprint of data and deliver a comprehensive analysis for our customers.
We have a track record of developing new solutions for our customers that provide increased relationship value and drive incremental average revenue per customer, thereby deepening our competitive edge.
We have a track record of developing new solutions for our customers that provide increased relationship value and drive incremental average revenue per customer, thereby deepening our competitive edge. As of December 31, 2024, we had 225 software and data engineers employed with us throughout our seven research and development centers focused on product development.
Successful legal challenge could cause uncertainty around the feasibility of transfers of personal data from the EU, the UK and Switzerland, to the United States, and has the potential to adversely affect our operations and business.
Successful legal challenge could cause uncertainty around the feasibility of transfers of personal data from the EU, the UK and Switzerland, to the United States, and has the potential to adversely affect our operations and business. 17 Table of Contents New laws restricting the collection, processing and use of personal data have been enacted in numerous states in the U.S., including California (the California Consumer Privacy Act (“CCPA”) and the California Privacy Rights and Enforcement Act (“CPRA”)), the U.K.
We intend to continue to invest in our research and development capabilities to extend our platform to cover a broader range of products, customers and geographies. 13 Table of Contents Technology Our technology is designed to provide our customers with precise, real-time decision-making and measurement data across their digital advertising campaigns.
Technology Our technology is designed to provide our customers with precise, real-time decision-making and measurement data across their digital advertising campaigns.
Our Industry We believe that our business benefits from many of the most significant trends in digital marketing and advertising, including: Significant Growth in Digital Ad Spend . The global advertising industry continues to shift from traditional forms of media to digital channels and platforms.
With respect to our overall business, we have delivered strong historical revenue growth, with a compounded annual growth rate of 25% from 2021 to 2024. Our Industry We believe that our business benefits from many of the most significant trends in digital marketing and advertising, including: Significant Growth in Digital Ad Spend .
More than ever, advertisers are being held accountable for brand and content alignment. In response, advertisers are adopting scalable, sophisticated brand suitability solutions to ensure effective use of their global digital media spend. 7 Table of Contents Desire to Improve Media Quality and Effectiveness .
Context of ad placement has become as important to a brand as the content of the ad itself. In response, advertisers are adopting scalable, sophisticated brand suitability solutions to establish centralized controls for consistent enforcement of their policies and ensure effective use of their global digital media spend. Desire to Improve Media Quality and Effectiveness .
Customers can use our extensive content categories to target desired contexts for their ads, without relying on third-party cookies, persistent identifiers or cross-site tracking technology.
We offer brands the ability to dynamically configure over 100 avoidance categories, such as disasters, news, politics, hate speech and violence, allowing brands to curate environments for their ads to be delivered. Customers can use our extensive content categories to identify desired contexts for their ads, without relying on third-party cookies, persistent identifiers or cross-site tracking technology.
Supporting these standards are organizations that conduct audit-based accreditations and other certification processes for media measurement products and to renew accreditations on an annual basis.
Supporting these standards are organizations that conduct audit-based accreditations and other certification processes for media measurement products and to renew accreditations on an annual basis. We have received accreditations and certifications from a wide range of industry bodies, including the Media Rating Council (MRC), Trustworthy Accountability Group and Japan Joint Industry Committee for Digital Advertising Quality (JICDAQ).
Our product development expenses were $125.4 million, $95.1 million and $62.7 million for each of the years ended December 31, 2023, December 31, 2022 and December 31, 2021.
Our product development expenses were $153.0 million, $125.4 million and $95.1 million for each of the years ended December 31, 2024, December 31, 2023 and December 31, 2022. We intend to continue to invest in our research and development capabilities to extend our platform to cover a broader range of products, customers and geographies.
We maintain a team of dedicated business development professionals who manage existing partnerships and develop new channels. Select integration and channel partners include: ● Demand-Side Platforms : Amazon, Google, The Trade Desk, Yahoo, Nexxen, AppNexus, Infillion, Adobe, Xandr ● Ad Platforms and Exchanges : Yahoo!
We maintain a team of dedicated business development professionals who manage existing partnerships and develop new channels.
We have over 15 registered U.S. trademarks and four pending U.S. trademark applications, and over 15 trademarks that we have registered in various jurisdictions abroad. People and Culture We help brands improve the effectiveness of their online advertising, giving them clarity and confidence in their digital investment. Confidence is built on trust.
People and Culture We help brands improve the effectiveness of their online advertising, giving them clarity and confidence in their digital investment. Confidence is built on trust. We work to build trust by ensuring our company’s mission, team, and actions are aligned with transparency and authenticity.
Our primary competition is other digital ad measurement providers, including Moat and Grapeshot, which are part of the Oracle Data Cloud, and Integral Ad Science. There are several companies that provide point solutions that address individual aspects of digital ad measurement, such as HUMAN (formerly known as White Ops) and Zefr, or geographically focused companies.
Additionally, there are several companies that provide point solutions that address individual aspects of digital ad measurement and performance, such as HUMAN, Peer 39, Chalice and Pixability, or geographically focused companies.
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With respect to our overall business, we have delivered strong historical revenue growth, with a compounded annual growth rate of 33% from 2020 to 2023. Our company was founded in 2008 and introduced our first brand safety and suitability solution in 2010.
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The global advertising industry continues to shift from traditional forms of media to digital channels and platforms. Magna Global estimated that global digital ad spend, excluding search, reached $329 billion in 2024 and is expected to grow to $448 billion by 2028.
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As the global digital advertising market has evolved, we have continued to expand our capabilities through new product innovation and partnerships across emerging programmatic media buying platforms and digital media channels, including social and CTV.
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To drive tangible business outcomes for advertisers, we offer robust measurement solutions to validate the performance of their marketing campaigns, advanced signals like attention and context to highlight inventory that demonstrates user engagement, interest and intent, and dynamic AI optimization to inform media buying strategies predictive of key performance indicator achievement. 7 Table of Contents Rising Adoption of Independent, Cookie-Less, Cross-Platform Solutions .
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Context of ad placement has become as important to a brand as the content of the ad itself. According to a study that we commissioned with The Harris Poll, nearly two-thirds of consumers expressed that they would stop using a brand or product that advertises next to false, objectionable or inflammatory content.
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Scibids AI In August 2023, we acquired Scibids Technology SAS (“Scibids”), a global leader in AI-powered digital campaign optimization.
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To combat these issues, advertisers, digital publishers and media platforms rely on robust measurement solutions to validate the performance of their marketing campaigns and ensure that they are only paying for verified ads. Rising Adoption of Independent, Cookie-Less, Cross-Platform Solutions .
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Sales, Marketing and Customer Support Our go-to-market strategy for new customers is focused on driving awareness for our solutions, and fostering relationships with senior brand executives and Chief Marketing Officers of leading brands, agencies and publishers.
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As of December 31, 2023, we had 209 software and data engineers employed with us throughout our seven research and development centers focused on product development, including our office in Tel Aviv. We launched our first brand safety and suitability solution in 2010 and have continued to develop leading-edge solutions ever since. Loyal and Growing Customer Base .
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We employ a holistic classification approach by analyzing key types of content, including visual, audio, speech, text and link elements. ● Deterministic, Cross-Channel Fraud and Invalid Traffic Identification : We operate multiple proprietary fraud and invalid traffic detection models that benefit from the scale of the ads we analyze on a daily basis.
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We offer brands the ability to dynamically configure 74 avoidance categories, nearly half of which contain a risk tier aligned with the recently released industry- defined standards, such as disasters, inflammatory news and politics, and hate speech or profanity, allowing brand messages to be delivered in a curated and suitable environment.
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In 2024, we further enhanced our privacy program by adding TrustArc’s Enterprise Privacy Certification and expanding our ISO 27001:2013 to include ISO 27701:2019, the privacy specific add-on to ISO 27001:2013.
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Integration and Channel Partnerships Our technology is integrated with leading digital advertising technology channels, supporting the distribution of our programmatic solutions and enabling us to analyze a broad footprint of data and deliver a comprehensive analysis for our customers.
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Ad platform partners that offer their own measurement and performance solutions for ads placed through their ad buying tools, such as The Trade Desk, Meta and Google, as well as other digital ad measurement providers, including Integral Ad Science, Scope3, Zefr, Nielson, Comscore and Protected Media constitute our primary competitors.
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We regularly seek to expand into new geographies based on demand from existing customers and the attractiveness of the potential market opportunity, including recent expansion in southeast Asia, Japan, India and the Middle East region.
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Trust is foundational to both the lasting partnerships we have built with clients and with our employees as well. Culture and Values By fostering diverse ideas, viewpoints and insights, we believe we drive innovation and competitive success in digital advertising.
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We have received accreditations and certifications from a wide range of industry bodies, including the Media Rating Council (MRC), Trustworthy Accountability Group and Joint Industry Committee for Digital Advertising Quality (JICDAQ), and are signatory to or participate in initiatives by industry bodies such as the German Association for the Digital Economy (BVDW) and Centre d’Étude des Supports de Publicité (CESP).
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Our values – Passion, Accountability, Collaboration and Trailblazing – are integral to our business strategy and focus on building capabilities, investing in our people, using data to scale progress and creating safe spaces. 16 Table of Contents Employee Metrics We believe that attracting, engaging, and retaining top talent is crucial to our continued success.
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In 2022, we also achieved ISO 27001:2013 certification for our information security management system.
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We have 1,197 employees around the world who are the driving force of our innovation and success. 715 of our employees are based in New York, London, and Tel Aviv, and approximately 42 % are located outside of the Americas. We also incorporate contracted resources to expand the reach of our full-time workforce.
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In early 2021, we received MRC accreditation for display and video rendered ad impression measurement and sophisticated invalid traffic (SIVT) filtration, including app fraud, in the CTV media environment and, in July 2021, we received MRC accreditation for video filtering, benchmarks, and CTV fully on-screen metrics.
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In 2021, we were also accredited by the MRC for classification in over 35 languages at the page and domain levels and accredited across 173 languages for language targeting and keyword blocking.
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In 2022, we were accredited by the MRC for our independent third-party calculation and reporting of Google’s Ads Data Hub (ADH) Video Impressions, viewable impressions and related viewability metrics, Display and Video DV Authentic Attention, and Display and Video CTV Ad verification metrics in English as well as eight other languages.
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Some of our ad platform partners also offer their own measurement solutions solely for ads placed through their ad buying tools.
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We work to build trust by ensuring our company’s mission, team, and actions are aligned with transparency and authenticity. Trust is foundational to both the lasting partnerships we have built with clients and with our employees as well. Employee Metrics Behind all of our innovations are talented people around the world who bring them to life.
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We believe that attracting, engaging, and retaining top talent is crucial to our continued success. We have 1,101 passionate, accountable, collaborative, employees who are “All In” on our mission to optimize advertising outcomes for global brands. 657 of our employees are based in New York, London, and Tel Aviv, and approximately 41% are located outside of the Americas.
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We also incorporate contracted resources to expand the reach of our full-time workforce. Diversity and Inclusion We are committed to fostering an equitable, intentionally inclusive culture, where differences are celebrated, marginalized voices are heard, and each employee is empowered by a sense of belonging.
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We take action to realize this commitment through building our capabilities, investing in our people to fuel ingenuity and innovation, creating workplace environments that foster partnership, community, psychological safety and belonging, and using data to quantify our progress and hold each other accountable.
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The number of colleagues that are fully remote has increased and we continue to reimagine the future of work to support the needs of our people. 17 Table of Contents Regulatory Matters U.S. and international data security and privacy laws apply to our business.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeFactors that may cause fluctuations in our revenues or results of operations include: ● our ability to retain and grow relationships with existing customers and attract new customers; ● the loss of demand-side platforms as integration partners; ● the timing and success of new product introductions, including the introduction of new technologies or offerings, by us, our competitors or others in the advertising marketplace; ● changes in the pricing of our solutions or those of our competitors; ● our failure to accurately estimate or control costs, including those incurred as a result of investments, other business or product development initiatives and the integration of acquired businesses; ● multi-year commitments with minimum purchase requirements; ● the effects of acquisitions and their integration; ● changes and uncertainty in the regulatory environment; ● the amount and timing of capital expenditures and operating costs related to the maintenance and expansion of our operations and infrastructure; ● service outages, other technical difficulties or security breaches; ● limitations relating to the capacity of our networks, systems and processes; ● maintaining appropriate staffing levels and capabilities relative to projected growth, or retaining key personnel; ● the risks associated with operating internationally; and ● general economic, political, regulatory, industry and market conditions and those conditions specific to internet usage and digital media. 34 Table of Contents Based upon the factors above and others both within and beyond our control, we have a limited ability to forecast our future revenue, costs and expenses, and as a result, our operating results may, from time to time, fall below our estimates or the expectations of analysts and investors.
Biggest changeFactors that may cause fluctuations in our revenues or results of operations include: ● our ability to retain and grow relationships with existing customers and attract new customers; ● the loss of demand-side platforms as integration partners; ● the timing and success of new product introductions, including the introduction of new technologies or offerings, by us, our competitors or others in the advertising marketplace; ● changes in the pricing of our solutions or those of our competitors; ● the evolving competitive landscape; ● our failure to accurately estimate or control costs, including those incurred as a result of investments, other business or product development initiatives and the integration of acquired businesses; ● multi-year commitments with minimum purchase requirements; ● the effects of acquisitions and their integration; ● changes and uncertainty in the regulatory environment; ● the amount and timing of capital expenditures and operating costs related to the maintenance and expansion of our operations and infrastructure; ● service outages, other technical difficulties or security breaches; ● limitations relating to the capacity of our networks, systems and processes; ● maintaining appropriate staffing levels and capabilities relative to projected growth, or retaining key personnel; ● the risks associated with operating internationally; and ● general economic, political, regulatory, industry and market conditions and those conditions specific to internet usage and digital media.
As this market evolves, competition may intensify as existing companies expand their businesses and new companies enter the market, which could lead to commoditization and harm our ability to increase revenue and maintain profitability. Our success depends on our ability to retain and grow our existing customers and sell our platform and solutions to new customers.
As this market evolves, competition may intensify as existing companies expand their businesses and new companies enter the market, which could lead to commoditization and harm our ability to increase revenue and maintain profitability. Our success depends on our ability to retain and grow our existing customers and market and sell our platform and solutions to new customers.
Current or future economic downturns or unstable market conditions in the markets and geographies that we currently serve, and associated macroeconomic conditions such as high inflation rates, high interest rates, recessionary fears, changes in foreign currency exchange rates, the conditions caused by the 2019 novel coronavirus or other future health pandemics and the impact of geopolitical instability in many parts of the world, may make it difficult for our customers and us to accurately forecast and plan future business activities, and could cause our customers to decrease their advertising budgets or slow the growth of their digital ad spend, which could adversely affect our business, financial condition and results of operations.
Current or future economic downturns or unstable market conditions in the markets and geographies that we currently serve, and associated macroeconomic conditions such as high inflation rates, high interest rates, recessionary fears, tariffs, changes in foreign currency exchange rates, the conditions caused by the 2019 novel coronavirus or other future health pandemics and the impact of geopolitical instability in many parts of the world, may make it difficult for our customers and us to accurately forecast and plan future business activities, and could cause our customers to decrease their advertising budgets or slow the growth of their digital ad spend, which could adversely affect our business, financial condition and results of operations.
Among the factors that could affect our stock price are: ● actual or anticipated fluctuations in our quarterly operating results; ● changes in securities analysts’ estimates of our financial performance or lack of research coverage and reports by industry analysts; ● actions by institutional stockholders or other large stockholders (including Providence), including future sales of our common stock; ● failure to meet any guidance given by us or any change in any guidance given by us, or changes by us in our guidance practices; ● industry, regulatory or general market conditions; ● domestic and international economic factors unrelated to our performance; ● changes in our customers’ or partners’ preferences; ● changes in law or regulation; ● lawsuits, enforcement actions and other claims by third parties or governmental authorities; ● adverse publicity related to us or another industry participant; ● announcements by us of significant impairment charges; ● speculation in the press or investment community; ● investor perception of us and our industry; ● changes in market valuations or earnings of similar companies; ● announcements by us or our competitors of significant contracts, acquisitions, dispositions or strategic partnerships; 37 Table of Contents ● war (including Russia’s invasion of Ukraine and Hamas’ attack against Israel), terrorist acts and epidemic disease; ● any future offerings of our common stock or other securities; ● additions or departures of key personnel; and ● misconduct or other improper actions of our employees.
Among the factors that could affect our stock price are: ● actual or anticipated fluctuations in our quarterly operating results; ● changes in securities analysts’ estimates of our financial performance or lack of research coverage and reports by industry analysts; ● actions by institutional stockholders or other large stockholders (including Providence), including future sales of our common stock; ● failure to meet any guidance given by us or any change in any guidance given by us, or changes by us in our guidance practices; ● industry, regulatory or general market conditions; ● domestic and international economic factors unrelated to our performance; ● changes in our customers’ or partners’ preferences; ● changes in law or regulation; ● lawsuits, enforcement actions and other claims by third parties or governmental authorities; ● adverse publicity related to us or another industry participant; ● announcements by us of significant impairment charges; ● speculation in the press or investment community; ● investor perception of us and our industry; ● changes in market valuations or earnings of similar companies; 38 Table of Contents ● announcements by us or our competitors of significant contracts, acquisitions, dispositions or strategic partnerships; ● war (including Russia’s invasion of Ukraine and Hamas’ attack against Israel), terrorist acts and epidemic disease; ● any future offerings of our common stock or other securities; ● additions or departures of key personnel; and ● misconduct or other improper actions of our employees.
For example, our amended and restated certificate of incorporation and amended and restated bylaws collectively: ● authorize the issuance of “blank check” preferred stock that could be issued by our board of directors to thwart a takeover attempt; ● provide for a classified board of directors, which divides our board of directors into three classes, with members of each class serving staggered three-year terms, which prevents stockholders from electing an entirely new board of directors at an annual meeting; ● limit the ability of stockholders to remove directors; ● provide that vacancies on our board of directors, including vacancies resulting from an enlargement of our board of directors, may be filled only by a majority vote of directors then in office; ● prohibit stockholders from calling special meetings of stockholders; 40 Table of Contents ● prohibit stockholder action by written consent, thereby requiring all actions to be taken at a meeting of the stockholders; ● establish advance notice requirements for nominations of candidates for election as directors or to bring other business before an annual meeting of our stockholders; and ● require the approval of holders of at least 66 2 ∕ 3 % in voting power of the outstanding shares of our capital stock to amend our amended and restated bylaws and certain provisions of our amended and restated certificate of incorporation.
For example, our amended and restated certificate of incorporation and amended and restated bylaws collectively: 41 Table of Contents ● authorize the issuance of “blank check” preferred stock that could be issued by our board of directors to thwart a takeover attempt; ● provide for a classified board of directors, which divides our board of directors into three classes, with members of each class serving staggered three-year terms, which prevents stockholders from electing an entirely new board of directors at an annual meeting; ● limit the ability of stockholders to remove directors; ● provide that vacancies on our board of directors, including vacancies resulting from an enlargement of our board of directors, may be filled only by a majority vote of directors then in office; ● prohibit stockholders from calling special meetings of stockholders; ● prohibit stockholder action by written consent, thereby requiring all actions to be taken at a meeting of the stockholders; ● establish advance notice requirements for nominations of candidates for election as directors or to bring other business before an annual meeting of our stockholders; and ● require the approval of holders of at least 66 2 ∕ 3 % in voting power of the outstanding shares of our capital stock to amend our amended and restated bylaws and certain provisions of our amended and restated certificate of incorporation.
To remain competitive, we will need to continuously upgrade our existing platform and develop new solutions that address evolving technologies and standards across all major channels, formats and devices for digital advertising, including mobile, social, video, in-app, display and connected television, as well as across digital media buying platforms, such as programmatic, direct ad exchanges and trading networks.
To remain competitive, we will need to continuously upgrade our existing platform and develop new solutions that address evolving technologies, advertising strategies and standards across all major channels, formats and devices for digital advertising, including mobile, social, video, in-app, display and connected television, as well as across digital media buying platforms, such as programmatic, direct ad exchanges and trading networks.
Risk Factors Summary Below is a summary of the principal factors that make an investment in our common stock speculative or risky: ● If we fail to respond to technological developments or evolving industry standards, our solutions may become obsolete or less competitive. ​ ● The market in which we participate is highly competitive. ​ ● System failures, security breaches, cyberattacks or natural disasters could interrupt the operation of our platform and data centers and significantly harm our business, financial condition and results of operations. ​ ● Our solutions rely on integrations with demand- and supply-side advertising platforms, ad servers and social platforms. ​ ● Economic downturns and unstable market conditions could adversely affect our business, financial condition and results of operations. ​ ● We have completed several acquisitions in the past and may consummate additional acquisitions in the future, which may be difficult to integrate, disrupt our business, expose us to unanticipated liabilities, dilute stockholder value or divert management attention. ​ ● We are subject to payment-related risks, and if our ability to accurately and timely collect payments is impaired, our business, financial condition and results of operations may be adversely affected. ​ ● Defects, errors or inaccuracies associated with our solutions could negatively impact our business, financial condition and results of operations. ​ ● We often have long sales cycles, which can result in significant time between initial contact with a prospect and execution of a contractual agreement, making it difficult to project when, if at all, we will generate revenue from new customers. ​ ● We depend on our senior management team and other key personnel to manage our business effectively, and if we are unable to retain such key personnel or hire additional qualified personnel, our ability to compete could be harmed. ​ 19 Table of Contents ● Increasing scrutiny and evolving expectations from customers, employees, regulators and other stakeholders with respect to our environmental, social and governance (“ESG”) practices may expose us to new or additional risks. ​ ● Data privacy legislation and regulation on digital advertising and privacy and data protection may adversely affect our business. ​ ● Public criticism of digital advertising technology in the U.S. and internationally, including digital advertising on social media platforms, could adversely affect the demand for and use of our solutions. ​ ● The success of our business depends in large part on our ability to protect and enforce our intellectual property rights. ​ ● An assertion from a third party that we are infringing its intellectual property rights, whether such assertion is valid or not, could subject us to costly and time-consuming litigation, expensive licenses or other impacts to our business. ​ ● We may face risks associated with our use of artificial intelligence and machine learning models. ​ ● We are exposed to the risks of operating internationally. ​ ● Exposure to foreign currency exchange rate fluctuations could negatively impact our results of operations. ​ ● Our use of “open source” software could subject our technology to general release or require us to re-engineer our platform, or subject us to litigation, which could harm our business, financial condition and results of operations. ​ ● Seasonal fluctuations in advertising activity could have a negative impact on our revenue, cash flow and operating results. ​ ● We have a limited operating history, which makes it difficult to evaluate our business and prospects and may increase the risks associated with your investment. ​ ● Our revenues and results of operations may fluctuate in the future.
Risk Factors Summary Below is a summary of the principal factors that make an investment in our common stock speculative or risky: ● If we fail to respond to technological developments or evolving industry standards, our solutions may become obsolete or less competitive. ​ ● The market in which we participate is highly competitive. ​ ● System failures, security breaches, cyberattacks or natural disasters could interrupt the operation of our platform and data centers and significantly harm our business, financial condition and results of operations. ​ ● Our solutions rely on integrations with demand- and supply-side advertising platforms, ad servers and social platforms. ​ ● Economic downturns and unstable market conditions could adversely affect our business, financial condition and results of operations. ​ ● We have completed several acquisitions in the past and may consummate additional acquisitions in the future, which may be difficult to integrate, disrupt our business, expose us to unanticipated liabilities, dilute stockholder value or divert management attention. ​ ● We are subject to payment-related risks, and if our ability to accurately and timely collect payments is impaired, our business, financial condition and results of operations may be adversely affected. ​ ● Defects, errors or inaccuracies associated with our solutions could negatively impact our business, financial condition and results of operations. ​ ● We often have long sales cycles, which can result in significant time between initial contact with a prospect and execution of a contractual agreement, making it difficult to project when, if at all, we will generate revenue from new customers. ​ ● We depend on our senior management team and other key personnel to manage our business effectively, and if we are unable to retain such key personnel or hire additional qualified personnel, our ability to compete could be harmed. ​ 19 Table of Contents ● Increasing scrutiny and evolving expectations from customers, employees, regulators and other stakeholders with respect to our corporate social responsibility (“CSR”) practices may expose us to new or additional risks. ​ ● Data privacy legislation and regulation on digital advertising and privacy and data protection may adversely affect our business. ​ ● Public criticism of digital advertising technology in the U.S. and internationally, including digital advertising on social media platforms, could adversely affect the demand for and use of our solutions. ​ ● The success of our business depends in large part on our ability to protect and enforce our intellectual property rights. ​ ● An assertion from a third party that we are infringing its intellectual property rights, whether such assertion is valid or not, could subject us to costly and time-consuming litigation, expensive licenses or other impacts to our business. ​ ● We may face risks associated with our use of artificial intelligence and machine learning models. ​ ● We are exposed to the risks of operating internationally. ​ ● Exposure to foreign currency exchange rate fluctuations could negatively impact our results of operations. ​ ● Our use of “open source” software could subject our technology to general release or require us to re-engineer our platform, or subject us to litigation, which could harm our business, financial condition and results of operations. ​ ● Seasonal fluctuations in advertising activity could have a negative impact on our revenue, cash flow and operating results. ​ ● We have a limited operating history, which makes it difficult to evaluate our business and prospects and may increase the risks associated with your investment. ​ ● Our revenues and results of operations may fluctuate in the future.
Acquisitions involve numerous risks, any of which could harm our business and financial performance, including: ● the difficulty of assimilating the operations and personnel of the acquired companies; ● the potential disruption of our business; 24 Table of Contents ● the inability of our management to maximize our financial and strategic position by the successful incorporation of acquired technology into our platform; ● unanticipated liabilities associated with an acquisition, including (i) technology, intellectual property and infringement issues, (ii) employment, retirement or severance related claims, (iii) claims by or amounts owed to customers or suppliers, (iv) adverse tax consequences and (v) other legal disputes; ● difficulty maintaining uniform standards, controls, procedures and policies, with respect to accounting matters and otherwise; ● the potential loss of key personnel of acquired companies; ● the impairment of relationships with employees and customers as a result of changes in management and operational structure; ● increased indebtedness to finance the acquisition; ● entrance into new geographic markets or new product segments that subjects us to different laws and regulations that may have an adverse impact on our business; and ● the diversion of management time and focus from operating our business to addressing acquisition integration challenges.
Acquisitions involve numerous risks, any of which could harm our business and financial performance, including: ● the difficulty of assimilating the operations and personnel of the acquired companies; ● the potential disruption of our business; ● the inability of our management to maximize our financial and strategic position by the successful incorporation of acquired technology into our platform; ● unanticipated liabilities associated with an acquisition, including (i) technology, intellectual property and infringement issues, (ii) employment, retirement or severance related claims, (iii) claims by or amounts owed to customers or suppliers, (iv) adverse tax consequences and (v) other legal disputes; ● difficulty maintaining uniform standards, controls, procedures and policies, with respect to accounting matters and otherwise; ● the potential loss of key personnel of acquired companies; ● the impairment of relationships with employees and customers as a result of changes in management and operational structure; ● increased indebtedness to finance the acquisition; ● entrance into new geographic markets or new product segments that subjects us to different laws and regulations that may have an adverse impact on our business; and ● the diversion of management time and focus from operating our business to addressing acquisition integration challenges.
Foreign Corrupt Practices Act and other applicable anti-corruption and anti- bribery laws; ● difficulties in staffing and managing international operations, including complex and costly hiring and termination requirements; ● reduced or varied protection for intellectual property rights in some countries; ● challenges caused by distance, language and cultural differences; ● political, social and economic instability abroad, terrorist attacks and security concerns, including due to the current war between Israel and Hamas; ● trade disruptions or political tensions between the U.S. and foreign countries (including as a result of Russia’s invasion of Ukraine); ● fluctuations in currency exchange rates; ● potentially adverse tax consequences and the complexities of foreign value-added taxes and the repatriation of earnings; 31 Table of Contents ● increased accounting and reporting burdens and complexities; and ● difficulties and expenses associated with tailoring our platform and solutions to local markets as may be required by local customers, regulations and local industry organizations.
Foreign Corrupt Practices Act and other applicable anti-corruption and anti- bribery laws; ● difficulties in staffing and managing international operations, including complex and costly hiring and termination requirements; ● reduced or varied protection for intellectual property rights in some countries; ● challenges caused by distance, language and cultural differences; ● political, social and economic instability abroad, terrorist attacks and security concerns, including due to the current war between Israel and Hamas; ● trade disruptions or political tensions between the U.S. and foreign countries (including as a result of Russia’s invasion of Ukraine); ● fluctuations in currency exchange rates; ● potentially adverse tax consequences and the complexities of foreign value-added taxes and the repatriation of earnings; ● increased accounting and reporting burdens and complexities; and ● difficulties and expenses associated with tailoring our platform and solutions to local markets as may be required by local customers, regulations and local industry organizations.
We have encountered and will continue to encounter risks and challenges frequently experienced by rapidly growing companies in developing industries, including risks related to our ability to: ● build a reputation for providing superior customer service and for creating trust and long-term relationships with our customers; ● distinguish ourselves from competitors; ● scale our business efficiently; ● maintain and expand our relationships with customers and partners; ● respond to evolving industry standards and government regulation that impact our business, particularly in the areas of data privacy; ● respond to technological advances; ● prevent or mitigate security failures or breaches; ● expand our business internationally; and ● hire and retain qualified employees.
We have encountered and will continue to encounter risks and challenges frequently experienced by rapidly growing companies in developing industries, including risks related to our ability to: ● build a reputation for providing superior customer service and for creating trust and long-term relationships with our customers; ● distinguish ourselves from competitors; ● scale our business efficiently; 33 Table of Contents ● maintain and expand our relationships with customers and partners; ● respond to evolving industry standards and government regulation that impact our business, particularly in the areas of data privacy; ● respond to technological advances; ● prevent or mitigate security failures or breaches; ● expand our business internationally; and ● hire and retain qualified employees.
However, we may need to raise additional funds in the future in order to, among other things: ● finance working capital requirements, capital investments or refinance existing or future indebtedness; ● acquire complementary businesses, technologies or products; ● develop or enhance our technological infrastructure and our existing platform and solutions; ● fund strategic relationships; and 36 Table of Contents ● respond to competitive pressures.
However, we may need to raise additional funds in the future in order to, among other things: ● finance working capital requirements, capital investments or refinance existing or future indebtedness; ● acquire complementary businesses, technologies or products; ● develop or enhance our technological infrastructure and our existing platform and solutions; 37 Table of Contents ● fund strategic relationships; and ● respond to competitive pressures.
Further, if our existing and future product offerings fail to maintain or achieve Media Rating Council (“MRC”) or other industry accreditation standards, customer acceptance of our products may decrease. The market in which we participate is highly competitive. The market for measurement, data analytics and authentication of digital advertising is competitive and evolving rapidly.
Further, if our existing and future product offerings fail to maintain or achieve Media Rating Council (“MRC”) or other industry accreditation standards, customer acceptance of our products may decrease. The market in which we participate is highly competitive. The market for measurement, data analytics, performance solutions and authentication of digital advertising is competitive and evolving rapidly.
If the data analytics we deliver to our customers are inaccurate or perceived to be inaccurate, due to defects or errors in our technology, our business may be harmed.
If the data analytics we deliver to our customers are inaccurate or perceived to be inaccurate, due to defects, errors or limitations in our technology, our business may be harmed.
See Note 5 to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further discussion on the goodwill recognized from our recent acquisitions. 35 Table of Contents Restrictions in the New Revolving Credit Facility could adversely affect our business, financial condition and results of operations.
See Note 5 to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further discussion on the goodwill recognized from our recent acquisitions. 36 Table of Contents Restrictions in the New Revolving Credit Facility could adversely affect our business, financial condition and results of operations.
If the payment of our debt is accelerated and we do not have sufficient cash available to repay such indebtedness, the lenders could enforce their security interests and liquidate some or all of the secured assets of the Credit Group to repay the outstanding principal and interest, and our stockholders could experience a partial or total loss of their investment.
If the payment of our debt is accelerated and we do not have sufficient cash available to repay such indebtedness, the lenders could enforce their security interests and liquidate some or all of the secured assets of certain members of the Credit Group to repay the outstanding principal and interest, and our stockholders could experience a partial or total loss of their investment.
We have also experienced significant growth in social media-related revenues and generate significant revenue from the use of our solutions on social media platforms, which have been and may in the future be the subject of avoidance campaigns or similar events, including ad boycotts on Facebook and X (formerly Twitter).
We have also experienced significant growth in social media-related revenues and generate significant revenue from the use of our solutions on social media platforms, which have been and may in the future be the subject of avoidance campaigns or similar events, including ad boycotts on Facebook and X.
In addition, we have partnerships with platforms to allow our customers to utilize our solutions, and these integration partners, some of which have significant market share in the segment in which they operate, could develop products that compete with us in the future.
In addition, we have partnerships with platforms to allow our customers to utilize our solutions, and these integration partners, some of which have significant market share in the segment in which they operate, have and could continue to develop products that compete with us.
For example, in August 2023, we acquired Scibids. Scibids builds AI that automates and optimizes an advertiser’s programmatic buying of digital ad campaigns. We also utilize AI and machine learning models in the development of our solutions.
For example, in August 2023, we acquired Scibids. Scibids builds AI that automates and optimizes an advertiser’s programmatic buying of digital ad campaigns. We also utilize AI and machine learning models in our classification engine and the development of our solutions.
If our customers significantly reduce or eliminate their digital ad spend in response to the public criticism of the digital advertising industry or its related effects, our business, financial condition and results of operations could be adversely affected. 29 Table of Contents The success of our business depends in large part on our ability to protect and enforce our intellectual property rights.
If our customers significantly reduce or eliminate their digital ad spend in response to the public criticism of the digital advertising industry or its related effects, our business, financial condition and results of operations could be adversely affected. The success of our business depends in large part on our ability to protect and enforce our intellectual property rights.
Our competitors or other third parties may incorporate AI into their offerings more quickly, cost-effectively or successfully than we can, which could impair our ability to compete effectively and adversely affect our results of operations. 30 Table of Contents We collect, store, use and share large amounts of data in the ordinary course of business.
Our competitors or other third parties may incorporate AI into their offerings more quickly, cost-effectively or successfully than we can, which could impair our ability to compete effectively and adversely affect our results of operations. We collect, store, use and share large amounts of data in the ordinary course of business.
We believe that our revenues and results of operations on a year-over-year and sequential quarter-over-quarter basis may vary significantly in the future. Investors are cautioned not to rely on the results of prior periods as an indication of future performance. We maintain cash deposits in excess of federally insured limits.
We believe that our revenues and results of operations on a year-over-year and sequential quarter-over-quarter basis may vary significantly in the future. Investors are cautioned not to rely on the results of prior periods as an indication of future performance. 35 Table of Contents We maintain cash deposits in excess of federally insured limits.
We or our third-party service providers could be adversely affected if legislation or regulations are expanded 28 Table of Contents to require changes in our or our third-party service providers’ business practices or if governing jurisdictions interpret or implement their legislation or regulations in ways that negatively affect our or our third-party service providers’ business, results of operations or financial condition.
We or our third-party service providers could be adversely affected if legislation or regulations are expanded to require changes in our or our third-party service providers’ business practices or if governing jurisdictions interpret or implement their legislation or regulations in ways that negatively affect our or our third-party service providers’ business, results of operations or financial condition.
We may not always be able to anticipate how existing laws will be interpreted in relation to AI, predict how new legal frameworks will develop to address AI, or otherwise respond to the new and rapidly evolving AI regulatory landscape. We are exposed to the risks of operating internationally.
We may not always be able to anticipate how existing laws will be interpreted in relation to AI, predict how new legal frameworks will develop to address AI, or otherwise respond to the new and rapidly evolving AI regulatory landscape. 31 Table of Contents We are exposed to the risks of operating internationally.
We may also have to close our offices again and return to a work-from-home model if a new pandemic arises. We have completed several acquisitions in the past and may consummate additional acquisitions in the future, which may be difficult to integrate, disrupt our business, expose us to unanticipated liabilities, dilute stockholder value or divert management attention.
We may also have to close our offices again and return to a work-from-home model if a new pandemic arises. 24 Table of Contents We have completed several acquisitions in the past and may consummate additional acquisitions in the future, which may be difficult to integrate, disrupt our business, expose us to unanticipated liabilities, dilute stockholder value or divert management attention.
In addition, the tax authorities in any applicable jurisdiction, including the U.S., may disagree with the positions we have taken or intend to take regarding the tax treatment or characterization of any of our transactions. Our revenues and results of operations may fluctuate in the future.
In addition, the tax authorities in any applicable jurisdiction, including the U.S., may disagree with the positions we have taken or intend to take regarding the tax treatment or characterization of any of our transactions. 34 Table of Contents Our revenues and results of operations may fluctuate in the future.
State-sponsored parties have, and will continue, to conduct cyberattacks to achieve their goals that may include espionage, monetary gain, disruption, and destruction. In addition, our ability to operate our platform and deliver our solutions may be interrupted by computer viruses, cyberattacks and security breaches.
State-sponsored parties have, and will continue, to conduct cyberattacks to achieve their goals that may include espionage, monetary gain, disruption, and destruction. 22 Table of Contents In addition, our ability to operate our platform and deliver our solutions may be interrupted by computer viruses, cyberattacks and security breaches.
We may also incur significant costs and resources to monitor, report, and comply with various ESG initiatives, laws and regulations. New laws and regulations relating to ESG matters, including sustainability, climate change, human capital and diversity, are being developed in the United States, Europe and elsewhere.
We may also incur significant costs and resources to monitor, report, and comply with various CSR initiatives, customer requirements, laws and regulations. New laws and regulations relating to CSR matters, including sustainability, climate change, human capital and diversity, are being developed in the United States, Europe and elsewhere.
We have formed partnerships with these platforms to integrate our technology with their software, allowing our customers to utilize our solutions wherever they purchase or place an ad. These platforms may deploy code or change operations that may impact joint solution and combined functionality, which would have a significant effect on our ability to offer our solutions.
We have formed partnerships with these platforms to integrate our technology with their software, allowing our customers to utilize our solutions wherever they purchase or place an ad. These platforms may deploy code or change operations that may impact the platform or our solutions and functionality, which would have a significant effect on our ability to offer our solutions.
Although no customer accounted for more than 10% of our revenue in 2023, two programmatic partner platforms collected approximately 18% and 17% each of our total revenue in 2023 on behalf of our advertiser customers using their platforms. In addition, each of our customers and integration partners may have different payment methods and cycles.
Although no customer accounted for more than 10% of our revenue in 2024, two programmatic partner platforms collected approximately 22% and 14% each of our total revenue in 2024 on behalf of our advertiser customers using their platforms. In addition, each of our customers and integration partners may have different payment methods and cycles.
Our company is led by a strong management team that has extensive experience leading technology and digital marketing companies. Our success and future growth depend to a significant degree on the leadership, knowledge, skills and continued services of our senior management team and other key personnel.
Our company is led by a strong management team that has extensive experience leading technology and digital marketing companies. Our success and future growth depend to a significant degree on the leadership, knowledge, skills and continued services of our senior management team and other key personnel. The loss of any of these persons could adversely affect our business.
While we are working to enhance our ESG efforts and related disclosures, if our stakeholders assess that our ESG efforts do not meet their expectations, which may continue to evolve, or we fail (or are perceived to fail) to meet the standards we set for our organization, our reputation, hiring initiatives, employee retention and customer and supplier relationships may be adversely affected.
If these stakeholders assess that our CSR efforts do not meet their expectations, which may continue to evolve, or we fail (or are perceived to fail) to meet the standards we set for our organization, our reputation, hiring initiatives, employee retention and customer and supplier relationships may be adversely affected.
The digital advertising industry has been and may in the future be subject to reputational harm, negative media attention and public complaint relating to, among other things, the alleged lack of transparency and anti-competitive behavior among advertising technology companies.
Our business depends, in part, on the demand for digital advertising technology. The digital advertising industry has been and may in the future be subject to reputational harm, negative media attention and public complaint relating to, among other things, the alleged lack of transparency and anti-competitive behavior among advertising technology companies.
Certain of our third-party service providers and other vendors have access to portions of our IT system. Performance failures or acts of negligence by these service providers may cause material disruptions to our IT systems. For more information about the cybersecurity risk management program, refer to “Item 1C.
Certain of our third-party service providers and other vendors have access to portions of our IT system. Performance failures or acts of negligence by these service providers may cause material disruptions to our IT systems. For more information about the cybersecurity risk management program, refer to “Item 1C. Cybersecurity” in this Annual Report on Form 10-K.
If our customers stopped using our solutions on these digital media platforms or if our integration partners decide to cease integrating our solutions, our business, financial condition and results of operations could be adversely affected.
If our customers stopped using our solutions on these digital media platforms or if our integration partners decide to cease integrating our solutions or require us to substantially change how our solutions are provided on these platforms, our business, financial condition and results of operations could be adversely affected.
Third-party intellectual property rights may cover significant aspects of our technologies or business methods or block us from expanding our platform and delivering new solutions, and we cannot be certain that our current operations do not infringe the rights of a third party.
There is significant intellectual property development activity in the measurement and authentication of digital ads. Third-party intellectual property rights may cover significant aspects of our technologies or business methods or block us from expanding our platform and delivering new solutions, and we cannot be certain that our current operations do not infringe the rights of a third party.
The timing of receipt of payment from our customers and integration partners may impact our cash flows and working capital. 25 Table of Contents Defects, errors or inaccuracies associated with our solutions could negatively impact our business, financial condition and results of operations. The technology underlying our platform may contain material defects or errors.
The timing of receipt of payment from our customers and integration partners may impact our cash flows and working capital. Defects, errors or inaccuracies associated with our solutions could negatively impact our business, financial condition and results of operations. The technology underlying our platform may contain material defects or errors and are subject to certain technological or scale limitations.
With 453 employees based outside of the Americas as of December 31, 2023, including 127 employees in our Tel Aviv office and 79 employees in our London office, we are exposed to a number of additional country-specific risks.
With 499 employees based outside of the Americas as of December 31, 2024, including 136 employees in our Tel Aviv office and 93 employees in our London office, we are exposed to a number of additional country-specific risks.
If our partners and their products are separated into separate companies, it could have a material effect on our ability to gather data and there can be no assurance that all of the separated companies will continue to be our partners, each of which could materially affect our business, results of operations, and revenues.
If our partners and their products are separated into separate companies, it could have a material effect on our ability to gather data and there can be no assurance that all of the separated companies will continue to be our partners, each of which could materially affect our business, results of operations, and revenues. 23 Table of Contents Our business, financial condition and results of operations could also be adversely affected by social issues or disruptions.
Alternatively, if a court were to find the choice of forum provision contained in our amended and restated certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could materially and adversely affect our business, financial condition or results of operations.
Alternatively, if a court were to find the choice of forum provision contained in our amended and restated certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could materially and adversely affect our business, financial condition or results of operations. 43 Table of Contents Our amended and restated certificate of incorporation includes provisions limiting the personal liability of our directors for breaches of fiduciary duty under the DGCL.
We did not identify any impairments of goodwill or long-lived assets for the years ended December 31, 2023 and December 31, 2021. We cannot predict the amount and timing of any future impairment of goodwill or other intangible assets.
We did not identify any impairments of goodwill or long-lived assets for the years ended December 31, 2024 and December 31, 2023. We identified an impairment of long-lived assets of $1.5 million for the year ended December 31, 2022. We cannot predict the amount and timing of any future impairment of goodwill or other intangible assets.
Additionally, changes in our strategy or significant technical developments could significantly impact the recoverability of our intangible assets. If the assumptions used in our analysis are not realized, it is possible that an impairment charge may need to be recorded in the future. We identified an impairment of long-lived assets of $1.5 million for the year ended December 31, 2022.
Additionally, changes in our strategy or significant technical developments could significantly impact the recoverability of our intangible assets. If the assumptions used in our analysis are not realized, it is possible that an impairment charge may need to be recorded in the future.
We believe that our ability to compete successfully in our market depends on a number of factors, both within and outside of our control, including: (i) the price, quality and effectiveness of our solutions and those of our competitors; (ii) our ability to retain and add new integration partners; (iii) the timing and success of new product introductions; (iv) our position as an independent third-party within the digital advertising ecosystem; (v) the emergence of new technologies; (vi) the number and nature of our competitors; (vii) the protection of our intellectual property rights; (viii) the adoption of new privacy standards or regulations; and (ix) general market and economic conditions.
We cannot assure you that our customers will continue to use our platform or that we will be able to replace, in a timely manner or at all, departing customers with new customers that generate comparable revenue. 21 Table of Contents We believe that our ability to compete successfully in our market depends on a number of factors, both within and outside of our control, including: (i) the price, quality and effectiveness of our solutions and those of our competitors; (ii) our ability to retain and add new integration partners and the availability of our solutions on those platforms; (iii) the timing and success of new product introductions; (iv) our position as an independent third-party within the digital advertising ecosystem; (v) the emergence of new technologies; (vi) the number and nature of our competitors; (vii) the protection of our intellectual property rights; (viii) the adoption of new privacy standards or regulations; and (ix) general market and economic conditions.
In addition, Delaware law imposes additional requirements that may restrict our ability to pay dividends to holders of our common stock. 41 Table of Contents Our amended and restated certificate of incorporation designates the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain litigation that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or stockholders.
Our amended and restated certificate of incorporation designates the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain litigation that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or stockholders.
Fulfilling our obligations incident to being a public company, including compliance with the Exchange Act and the requirements of the NYSE, the Sarbanes-Oxley Act and the Dodd-Frank Act, is expensive and time- consuming, and any delays or difficulties in satisfying these obligations could have a material adverse effect on our future results of operations and our stock price.
Thus, holders of our common stock will bear the risk of our future offerings reducing the market price of our common stock or diluting their ownership stake in us. 40 Table of Contents Fulfilling our obligations incident to being a public company, including compliance with the Exchange Act and the requirements of the NYSE, the Sarbanes-Oxley Act and the Dodd-Frank Act, is expensive and time- consuming, and any delays or difficulties in satisfying these obligations could have a material adverse effect on our future results of operations and our stock price.
Our amended and restated certificate of incorporation contains provisions eliminating a director’s personal liability to the fullest extent permitted by the DGCL for monetary damages resulting from a breach of fiduciary duty, except in circumstances involving: ● any breach of the director’s duty of loyalty; ● acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of the law; ● under Section 174 of the DGCL (unlawful dividends); or ● any transaction from which the director derives an improper personal benefit. 42 Table of Contents The principal effect of the limitation on liability provision is that a stockholder will be unable to prosecute an action for monetary damages against a director unless the stockholder can demonstrate a basis for liability for which indemnification is not available under the DGCL.
Our amended and restated certificate of incorporation contains provisions eliminating a director’s personal liability to the fullest extent permitted by the DGCL for monetary damages resulting from a breach of fiduciary duty, except in circumstances involving: ● any breach of the director’s duty of loyalty; ● acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of the law; ● under Section 174 of the DGCL (unlawful dividends); or ● any transaction from which the director derives an improper personal benefit.
Our sales efforts involve educating our customers about the use, technical capabilities and benefits of our software platform. Some of our customers undertake an evaluation process that involves reviewing the offerings of our competitors in addition to our platform.
Our sales cycle, from initial contact to contract execution and implementation, is often long and time consuming. Our sales efforts involve educating our customers about the use, technical capabilities and benefits of our software platform. Some of our customers undertake an evaluation process that involves reviewing the offerings of our competitors in addition to our platform.
At any given time, one or more of our customers or partners may experience financial difficulty, file for bankruptcy protection or cease operations. Unfavorable economic and financial conditions could result in an increase in customer or partner financial difficulties which could adversely affect us. In addition, we rely on data from third parties to invoice our clients.
We have a large and diverse customer and integration partner base. At any given time, one or more of our customers or partners may experience financial difficulty, file for bankruptcy protection or cease operations. Unfavorable economic and financial conditions could result in an increase in customer or partner financial difficulties which could adversely affect us.
In addition, we may be forced to re-engineer our platform or discontinue use of certain open source software, and related solutions provided by our platform that use such open source software.
In addition, we may be forced to re-engineer our platform or discontinue use of certain open source software, and related solutions provided by our platform that use such open source software. Any of these events could adversely affect our business, financial condition and results of operations.
We currently intend to use our future earnings, if any, to fund our growth, including through acquisitions, and for working capital needs and general corporate purposes.
We do not intend to declare and pay dividends on our common stock for the foreseeable future. We currently intend to use our future earnings, if any, to fund our growth, including through acquisitions, and for working capital needs and general corporate purposes.
Additionally, how we categorize specific sites in the course of our normal business operations could expose us to risks from publishers or advertisers who may disagree with our categorizations and incur negative ramifications if they believe their ads were monetarily contributing to websites that contribute to the spread of hate speech, disinformation, white supremacist activity, or voter suppression efforts, among other things.
Additionally, how we categorize specific sites in the course of our normal business operations could expose us to risks from publishers or advertisers who may disagree with our categorizations and incur negative ramifications if they believe their ads were monetarily contributing to websites that contribute to or otherwise appear alongside content they deem objectionable.
Our business, financial condition and results of operations could also be adversely affected by social issues or disruptions. For example, if there is public disapproval or boycotting of a specific platform, our ability to optimize ad placement or to forecast usage may be impacted based on unforeseen trends or events.
For example, if there is public disapproval or boycotting of a specific platform, our ability to optimize ad placement or to forecast usage may be impacted based on unforeseen trends or events.
In the future, we may need to expand our systems at a significant cost and at a more rapid pace than we have to date. We may be unable to provide our solutions on a timely basis or experience performance issues with our platform if we fail to adequately expand or maintain our system capabilities to meet future requirements.
We may be unable to provide our solutions on a timely basis or experience performance issues with our platform if we fail to adequately expand or maintain our system capabilities to meet future requirements.
As of December 31, 2023, we had $436.0 million of goodwill and $274.0 million of other long-lived assets, including property, plant and equipment and intangible assets.
As of December 31, 2024, we had $427.6 million of goodwill and $289.5 million of other long-lived assets, including property, plant and equipment and intangible assets.
Exposure to foreign currency exchange rate fluctuations could negatively impact our results of operations. While the majority of our transactions are denominated in U.S. dollars, we frequently transact in foreign currencies, including for payments from clients, expenses and acquisition costs. We also have expenses denominated in currencies other than the U.S. dollar.
While the majority of our transactions are denominated in U.S. dollars, we frequently transact in foreign currencies, including for payments from clients, expenses and acquisition costs. We also have expenses denominated in currencies other than the U.S. dollar. Given our investment in international growth, we expect the number of our foreign currency transactions to increase in the future.
The integration partner’s change may cause a malfunction in the integration leading to a break in services. We cannot assure you that any updated solutions will be compatible or accepted by our integration partners. Additionally, some of our integration partners are subject to regulatory actions, which, if successful, could cause our partners to be broken into separate companies.
The integration partner’s change may cause a malfunction in the integration leading to a break in services. We cannot assure you that any updated solutions will be compatible or accepted by our integration partners.
Any perception of our practices, platform or solutions delivery as a violation of privacy rights may subject us to public criticism, loss of customers or partners, class action lawsuits, reputational harm, or investigations or claims by regulators, industry groups or other third parties, all of which could significantly disrupt our business and expose us to liability in ways that negatively affect our business, results of operations and financial condition.
Any perception of our practices, platform or solutions delivery as a violation of privacy rights may subject us to public criticism, loss of customers or partners, class action lawsuits, reputational harm, or investigations or claims by regulators, industry groups or other third parties, all of which could significantly disrupt our business and expose us to liability in ways that negatively affect our business, results of operations and financial condition. 28 Table of Contents In addition, U.S. and foreign governments have enacted or are considering enacting new legislation related to privacy, data protection, data security and digital advertising and we expect to see an increase in, or changes to, legislation and regulation that affects our industry.
The New Revolving Credit Facility also contains covenants requiring the Credit Group to maintain certain financial ratios. The Credit Group’s ability to meet those financial ratios can be affected by events beyond our control, and we cannot assure you that the Credit Group will meet any such ratios in the future.
The Credit Group’s ability to meet such financial ratio can be affected by events beyond our control, and we cannot assure you that the Credit Group will meet any such ratios in the future. The New Revolving Credit Facility is secured by substantially all of the assets (subject to customary exceptions) of certain members of the Credit Group.
Future acquisitions could also result in the incurrence or assumption of debt, contingent liabilities, amortization expenses or the impairment of goodwill, any of which could harm our business, financial condition and results of operations. We cannot assure you that we will continue to acquire businesses at attractive valuations or that we will complete future acquisitions at all.
Future acquisitions could also result in the incurrence or assumption of debt, contingent liabilities, amortization expenses or the impairment of goodwill, any of which could harm our business, financial condition and results of operations.
Our business depends on the demand for digital advertising measurement and authentication and on the overall economic health of our customers and integration partners. There is no assurance the digital advertising market will experience the growth we anticipate. The health of the digital advertising market and the related measurement and authentication sector is affected by many factors.
Economic downturns and unstable market conditions could adversely affect our business, financial condition and results of operations. Our business depends on the demand for digital advertising measurement and authentication and on the overall economic health of our customers and integration partners. There is no assurance the digital advertising market will experience the growth we anticipate.
Additionally, Providence will continue to have the right to designate for nomination for election one of our directors so long as it beneficially owns at least 5% of our common stock.
Other potential conflicts could arise, for example, over matters such as employee retention or recruiting, or our dividend policy. Additionally, Providence will continue to have the right to designate for nomination for election one of our directors so long as it beneficially owns at least 5% of our common stock.
Any failure, or perceived failure, by us to adhere to our stated ESG goals, comply fully with developing ESG law and regulation or failure to satisfy stakeholders with our ESG practices or the speed at which we implement them could harm our business, reputation, financial condition and operating results. 27 Table of Contents Data privacy legislation and regulation on digital advertising and privacy and data protection may adversely affect our business.
Any failure, or perceived failure, by us to adhere to CSR initiatives, comply fully with developing CSR law and regulation or failure to satisfy stakeholders with our CSR practices or the speed at which we implement them could harm our business, reputation, financial condition and operating results.
Our clients have in the past, and may in the future, dispute the way we calculate billing for our solutions or the data on which rely to calculate billing. If we are unable to resolve such disputes, we may lose clients or clients may decrease their use of our solutions and our financial performance and growth may be adversely affected.
If we are unable to resolve such disputes, we may lose clients or clients may decrease their use of our solutions and our financial performance and growth may be adversely affected.
If we are unable to do so, our business may suffer, our revenue and operating results may decline and we may not be able to achieve further growth or sustain profitability. 33 Table of Contents We are subject to taxation in multiple jurisdictions.
We cannot assure you that we will be successful in addressing these and other challenges we may face in the future. If we are unable to do so, our business may suffer, our revenue and operating results may decline and we may not be able to achieve further growth or sustain profitability. We are subject to taxation in multiple jurisdictions.
Open source software is generally licensed by its authors or other third parties under open source licenses, which typically do not provide for any representations, warranties or indemnity coverage by the licensor.
Some of our technology incorporates so-called “open source” software, and we may incorporate additional open source software in the future. Open source software is generally licensed by its authors or other third parties under open source licenses, which typically do not provide for any representations, warranties or indemnity coverage by the licensor.
See “We are exposed to the risks of operating internationally.” Increasing scrutiny and evolving expectations from customers, employees, regulators and other stakeholders with respect to our environmental, social and governance (“ESG”) practices may expose us to new or additional risks. Customers, employees, governmental organizations, investors, proxy advisory services and other stakeholders are increasingly focused on ESG practices.
See “We are exposed to the risks of operating internationally.” 27 Table of Contents Increasing scrutiny and evolving expectations from customers, employees, regulators and other stakeholders with respect to our corporate social responsibility (“CSR”) practices may expose us to new or additional risks.
An assertion from a third party that we are infringing its intellectual property rights, whether such assertion is valid or not, could subject us to costly and time-consuming litigation, expensive licenses or other impacts to our business. There is significant intellectual property development activity in the measurement and authentication of digital ads.
A failure to protect our intellectual property rights in the U.S. or elsewhere could adversely affect our business, financial condition and results of operations. 30 Table of Contents An assertion from a third party that we are infringing its intellectual property rights, whether such assertion is valid or not, could subject us to costly and time-consuming litigation, expensive licenses or other impacts to our business.
We cannot be certain that the investments and additional resources required for establishing and maintaining operations in other countries will hold their value or produce desired levels of revenues or profitability. Any one or more of these factors could negatively impact our international operations and thus adversely affect our business, financial condition and results of operations.
We cannot be certain that the investments and additional resources required for establishing and maintaining operations in other countries will hold their value or produce desired levels of revenues or profitability.
Any regulatory or civil action that is brought against us, even if unsuccessful, may distract our management’s attention, divert our resources, negatively affect our public image or reputation among our customers and partners and within our industry, and, consequently, harm our business, results of operations and financial condition.
Any regulatory or civil action that is brought against us, even if unsuccessful, may distract our management’s attention, divert our resources, negatively affect our public image or reputation among our customers and partners and within our industry, and, consequently, harm our business, results of operations and financial condition. 29 Table of Contents Public criticism of digital advertising technology in the U.S. and internationally, including digital advertising on social media platforms, could adversely affect the demand for and use of our solutions.
Cybersecurity” in this Annual Report on Form 10-K. 22 Table of Contents Our solutions rely on integrations with demand- and supply-side advertising platforms, ad servers and social platforms. Our solutions necessitate that demand- and supply-side advertising platforms, ad servers and social platforms accept and integrate with our technology.
Our solutions rely on integrations with demand- and supply-side advertising platforms, ad servers and social platforms. Our solutions necessitate that demand- and supply-side advertising platforms, ad servers and social platforms accept and integrate with our technology.
Any inaccuracy or perceived inaccuracy in the solutions we provide could lead to consequences that adversely impact our business, financial condition and results of operations, including: ● loss of customers; ● the incurrence of substantial costs to correct any material defect or error; ● potential litigation; ● interruptions in the availability of our platform; ● diversion of development resources; ● loss of MRC or other industry accreditation; ● lost sales or delayed market acceptance of our solutions; and ● damage to our brand.
Any inaccuracy or perceived inaccuracy in the solutions we provide could lead to consequences that adversely impact our business, financial condition and results of operations, including: ● loss of customers; ● the incurrence of substantial costs to correct any material defect or error; ● potential litigation; ● interruptions in the availability of our platform; ● diversion of development resources; ● loss of MRC or other industry accreditation; ● lost sales or delayed market acceptance of our solutions; and ● damage to our brand. 26 Table of Contents We often have long sales cycles, which can result in significant time between initial contact with a prospect and execution of a contractual agreement, making it difficult to project when, if at all, we will generate revenue from new customers.
Our current and potential competitors may have more financial, technical, marketing and other resources, as well as longer operating histories and greater name recognition than we do. As a result, these competitors may be better able to respond quickly to new technologies or devote greater resources to the development, promotion, sale and support of their products and services.
As a result, these competitors may be better able to respond quickly to new technologies or devote greater resources to the development, promotion, sale and support of their products and services.
In addition, changes to labor and immigration laws and regulations may adversely affect our access to technical and professional talent. Competition for personnel is intense, particularly those with technological expertise and our key areas of operations, including New York, Tel Aviv, Singapore, Berlin and London.
Competition for personnel is intense, particularly those with technological expertise and our key areas of operations, including New York, Tel Aviv, Paris, Singapore, Berlin and London.
Further, the New Revolving Credit Facility limits the ability of our subsidiaries to pay dividends or otherwise transfer assets to us.
Further, the New Revolving Credit Facility limits the ability of our subsidiaries to pay dividends or otherwise transfer assets to us. In addition, Delaware law imposes additional requirements that may restrict our ability to pay dividends to holders of our common stock.
In addition, the laws of some foreign countries where our platform is utilized do not protect our proprietary rights to the same extent as do the laws of the United States. A failure to protect our intellectual property rights in the U.S. or elsewhere could adversely affect our business, financial condition and results of operations.
In addition, the laws of some foreign countries where our platform is utilized do not protect our proprietary rights to the same extent as do the laws of the United States.
If any of our stockholders were to bring a similar lawsuit against us, the defense and disposition of the lawsuit could be costly and divert the time and attention of our management and could materially and adversely affect our business, financial condition, results of operations or cash flows.
If any of our stockholders were to bring a similar lawsuit against us, the defense and disposition of the lawsuit could be costly and divert the time and attention of our management and could materially and adversely affect our business, financial condition, results of operations or cash flows. 42 Table of Contents We do not intend to pay dividends on our common stock for the foreseeable future and, consequently, your ability to achieve a return on your investment depends on appreciation in the price of our common stock.
Our success depends on the efficient and uninterrupted operation of our platform. A failure of our computer systems, or those of our demand-side integration partners, could impede access to our platform, interfere with our data analytics, prevent the timely delivery of our solutions or damage our reputation.
A failure of our computer systems, or those of our demand-side integration partners, could impede access to our platform, interfere with our data analytics, prevent the timely delivery of our solutions or damage our reputation. In the future, we may need to expand our systems at a significant cost and at a more rapid pace than we have to date.
If one or more of the analysts ceases coverage of our common stock or fails to publish reports on us regularly, demand for our common stock could decrease, which could cause our common stock price or trading volume to decline.
If one or more of the analysts ceases coverage of our common stock or fails to publish reports on us regularly, demand for our common stock could decrease, which could cause our common stock price or trading volume to decline. 39 Table of Contents Providence has significant influence over us and may not always exercise its influence in a way that benefits our public stockholders.
We also cannot assure you that our customers will continue to use our solutions available on these digital media platforms. Some of our integration partners have developed products that compete with us and we cannot assure you that other partners will not also develop competing products in the future.
Some of our integration partners have developed products that compete with us and that are able to be offered at substantially lower pricing or for free, and we cannot assure you that other partners will not also develop competing products in the future.
There are a growing number of data privacy and protection laws and regulations in the digital advertising industry that apply to our business. We have dedicated, and expect to continue to dedicate, significant resources in our efforts to comply with such laws and regulations.
Data privacy legislation and regulation on digital advertising and privacy and data protection may adversely affect our business. There are a growing number of data privacy and protection laws and regulations in the digital advertising industry that apply to our business.
New regulations that prohibit the use of certain restrictive covenants in agreements with our employees could impact our ability to retain existing employees. Further, new employees often require significant training and we may lose new or existing employees to our competitors or other companies before we realize the benefit of our investment in recruiting and training them.
Further, new employees often require significant training and we may lose new or existing employees to our competitors or other companies before we realize the benefit of our investment in recruiting and training them. In addition, changes to labor and immigration laws and regulations may adversely affect our access to technical and professional talent.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur cybersecurity risk management program includes: ● risk assessments designed to assess, identify and manage material cybersecurity risks to our critical systems, information, solutions, and our broader IT environment; ● an incident response plan; ● vulnerability management, penetration testing, tabletop exercises and ongoing threat intelligence; ● the use of third-parties, where appropriate, to engage in penetration testing, conduct audits of our systems and engage in monitoring; ● enterprise-wide cybersecurity awareness training; and ● a third-party risk management process for vendors. 43 Table of Contents Cybersecurity Governance Cybersecurity is an important part of our risk management processes and an area of focus for the Board of Directors of DoubleVerify (the “Board”) and management.
Biggest changeOur cybersecurity risk management program includes: ● risk assessments designed to assess, identify and manage material cybersecurity risks to our critical systems, information, solutions, and our broader IT environment; 44 Table of Contents ● an incident response plan; ● vulnerability management, penetration testing, tabletop exercises and ongoing threat intelligence; ● the use of third-parties , where appropriate, to engage in penetration testing, conduct audits of our systems and engage in monitoring ; ● enterprise-wide cybersecurity awareness training; and ● a third-party risk management process for vendors.
Our Board as a whole has responsibility for overseeing our risk management program. The Board exercises this oversight responsibility directly and through its committees.
Cybersecurity Governance Cybersecurity is an important part of our risk management processes and an area of focus for the Board of Directors of DoubleVerify (the “Board”) and management. Our Board as a whole has responsibility for overseeing our risk management program. The Board exercises this oversight responsibility directly and through its committees.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe believe that our properties are adequate for our current needs and if we require additional space, we believe that we would be able to obtain such space on commercially reasonable terms. ​
Biggest changeWe believe that our properties are adequate for our current needs and if we require additional space, we believe that we would be able to obtain such space on commercially reasonable terms. 45 Table of Contents ​

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings We are not currently a party to any legal proceedings that would, either individually or in the aggregate, have a material adverse effect on our business, financial condition or cash flows. We may, from time to time, be involved in legal proceedings arising in the normal course of business.
Biggest changeItem 3. Legal Proceedings We are not currently a party to any legal proceedings that would, either individually or in the aggregate, be expected to have a material adverse effect on our business, financial condition or cash flows. We may, from time to time, be involved in legal proceedings arising in the normal course of business.
The outcome of legal proceedings is unpredictable and may have an adverse impact on our business or financial condition. ​ Item 4. Mine Safety Disclosures Not applicable. 44 Table of Contents PART II
The outcome of legal proceedings is unpredictable and may have an adverse impact on our business or financial condition. ​ Item 4. Mine Safety Disclosures Not applicable. 46 Table of Contents PART II

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. Mine Safety Disclosures 44 ​ ​ PART II 45 ​ ​ Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 45 Item 6. [Reserved] 46 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 47 Item 7A. Quantitative and Qualitative Disclosure about Market Risk 64 Item 8.
Biggest changeItem 4. Mine Safety Disclosures 46 ​ ​ PART II 47 ​ ​ Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 47 Item 6. [Reserved] 48 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 49 Item 7A. Quantitative and Qualitative Disclosure about Market Risk 66 Item 8.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeWe did not declare or pay any dividends on our common stock in 2023, 2022 or 2021. Purchases of Equity Securities by the Issuer and Affiliated Purchases None. Recent Sales of Unregistered Securities None.
Biggest changeWe did not declare or pay any dividends on our common stock in 2024, 2023 or 2022.
Stock Performance Graph The following graph compares the cumulative total stockholder return on an initial investment of $100 in our common stock between April 21, 2021, and December 31, 2023, with the comparative cumulative total returns of the Standard & Poor’s (“S&P”) 500 Index, Nasdaq Composite Index and Russell 3000 Index over the same period.
Stock Performance Graph The following graph compares the cumulative total stockholder return on an initial investment of $100 in our common stock between April 21, 2021, and December 31, 2024, with the comparative cumulative total returns of the Standard & Poor’s (“S&P”) 500 Index, Nasdaq Composite Index and Russell 3000 Index over the same period.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Holders of Record Our common stock is listed on the NYSE under the symbol “DV”. As of February 20, 2024, we had 171,253,902 shares of common stock outstanding and 103 holders of record of our common stock.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Holders of Record Our common stock is listed on the NYSE under the symbol “DV”. As of February 18, 2025, we had 166,011,725 shares of common stock outstanding and 78 holders of record of our common stock.
Removed
Use of Proceeds On April 23, 2021, we completed our IPO in which we sold 9,977 thousand shares of common stock at a public offering price of $27.00 per share, which includes the full exercise of the underwriters’ option to purchase 1,350 thousand additional shares from us.
Added
Purchases of Equity Securities by the Issuer and Affiliated Purchases The following table summarizes share repurchase activity for the three months ended December 31, 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Number of Shares ​ Maximum Approximate Dollar ​ ​ ​ ​ ​ ​ Purchased as Part of ​ Value of Shares that ​ ​ Total Number of Shares ​ Average Price Paid ​ Publicly Announced Plans or ​ May Yet Be Purchased Period ​ Purchased (1)(2) ​ Per Share (3) ​ Programs (1)(2) ​ Under the Plans or Programs (1)(2) ​ ​ (in thousands) ​ ​ ​ (in thousands) ​ (in thousands) October 1 - 31 ​ ​ 1,479 ​ $ 16.90 ​ ​ 1,479 ​ $ 75,000 November 1 - 30 ​ 716 ​ 19.45 ​ 716 ​ 261,069 December 1 - 31 ​ 1,969 ​ $ 19.78 ​ 1,969 ​ $ 222,136 Total for the three months ended December 31, 2024 ​ ​ 4,164 ​ ​ ​ ​ ​ 4,164 ​ ​ ​ (1) On May 16, 2024, the Company announced that its Board of Directors had authorized the repurchase of up to $150 million of the Company’s outstanding common stock under the Repurchase Program.
Removed
We received aggregate net proceeds of $253.2 million from the IPO, after deducting underwriting discount fees of $16.2 million. We incurred offering costs related to the IPO of approximately $26.1 million, inclusive of underwriting discount fees.
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Under the Repurchase Program, the Company may repurchase for cash from time to time shares of its common stock through open market purchases pursuant to Rule 10b-18 and/or Rule 10b5-1 plans, in compliance with applicable securities laws and other legal requirements.
Removed
All of the shares issued and sold in our IPO were registered under the Securities Act pursuant to a registration statement on Form S-1 (File No. 333-254380), which was declared effective by the SEC on April 20, 2021. The representatives of the underwriters of our IPO were Goldman Sachs & Co. LLC and J.P. Morgan Securities LLC.
Added
The Repurchase Program does not obligate the Company to repurchase any specific number of shares, has no time limit, and may be modified, suspended, or discontinued at any time at the Company’s discretion. Refer to “Results of Operations” for further information on the Repurchase Program.
Removed
In connection with the IPO, Providence and certain of our other existing stockholders sold an aggregate of 5,356 thousand shares of our common stock, which includes the full exercise of the underwriters’ option to purchase 650 thousand additional shares of our common stock from Providence. We did not receive any proceeds from the sale of shares by these stockholders.
Added
(2) On November 6, 2024, the Company announced that its Board of Directors had authorized the repurchase of up to $200 million of the Company’s outstanding common stock under the New Repurchase Program, which amount is in addition to the initial Repurchase Program previously approved by the Board in May 2024.
Removed
On April 23, 2021, concurrent with the completion of the IPO, an affiliate of Tiger Global Management, LLC (“Tiger Investor”) purchased from us 1,111 thousand shares of our common stock in a private placement at a price per share equal to the IPO price of $27.00 (the “Concurrent Private Placement”).
Added
Under the New Repurchase Program, the Company may repurchase for cash from time to time shares of its common stock through open market purchases pursuant to Rule 10b-18 and/or Rule 10b5-1 plans, in compliance with applicable securities laws and other legal requirements.
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We received aggregate net proceeds of $29.0 million from the Concurrent Private Placement, after deducting fees of $1.0 million. 45 Table of Contents On April 30, 2021, we used a portion of the net proceeds from the IPO and Concurrent Private Placement to pay the entire outstanding balance under the New Revolving Credit Facility of $22.0 million.
Added
The New Repurchase Program does not obligate the Company to repurchase any specific number of shares, has no time limit, and may be modified, suspended, or discontinued at any time at the Company’s discretion. Refer to “Results of Operations” for further information on the New Repurchase Program.
Removed
On August 31, 2021, we used a portion of the net proceeds from the IPO and Concurrent Private Placement to purchase all of the outstanding stock of Meetrics for $24.3 million.
Added
(3) Excludes other costs such as broker commissions and the accrued excise tax imposed by the Inflation Reduction Act of 2022 (“IRA”). 47 Table of Contents ​ ​ Recent Sales of Unregistered Securities None. Use of Proceeds None.
Removed
On November 22, 2021, we used a portion of the net proceeds from the IPO and Concurrent Private Placement to purchase all of the outstanding stock of OpenSlate for $147.4 million, which included net cash of $124.9 million and common stock transferred of $22.5 million.
Removed
On August 14, 2023, we used a portion of the net proceeds from the IPO and Concurrent Private Placement to purchase all of the outstanding stock of Scibids for $121.4 million, which included net cash of $67.2 million, common stock issued of $52.9 million, and a fair value of the Scibids Contingent Payment of $1.2 million.
Removed
As of December 31, 2023, all IPO net proceeds have been used to fund acquisitions and for working capital, as described in our final prospectus, dated April 20, 2021 and filed with the SEC, pursuant to Rule 424(b)(4) under the Securities Act, on April 22, 2021 (the “Prospectus”).

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

90 edited+22 added−26 removed63 unchanged
Biggest changeWe believe that the year-over-year comparison of results more appropriately reflects the overall performance of the business. 55 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ Dec 31, ​ Sep 30, ​ Jun 30, ​ Mar 31, ​ Dec 31, ​ Sep 30, ​ Jun 30, ​ Mar 31, ​ 2023 2023 2023 2023 2022 2022 2022 2022 ​ ​ (In Thousands) Revenue ​ $ 172,231 $ 143,974 $ 133,744 $ 122,594 $ 133,636 $ 112,254 $ 109,805 $ 96,723 Cost of revenue (exclusive of depreciation and amortization shown separately below) ​ 30,022 ​ 26,466 ​ 26,191 ​ 23,952 ​ 22,830 ​ 19,323 ​ 18,836 ​ 16,877 Product development ​ 32,565 ​ 32,315 ​ 31,941 ​ 28,555 ​ 26,376 ​ 23,932 ​ 23,222 ​ 21,588 Sales, marketing and customer support ​ 35,733 ​ 32,971 ​ 31,537 ​ 25,712 ​ 28,881 ​ 27,118 ​ 24,733 ​ 26,684 General and administrative ​ 24,748 ​ 23,280 ​ 19,755 ​ 20,188 ​ 18,067 ​ 19,395 ​ 21,529 ​ 19,675 Depreciation and amortization ​ 11,520 ​ 10,706 ​ 9,676 ​ 8,983 ​ 8,882 ​ 8,089 ​ 8,317 ​ 9,040 Income from operations ​ 37,643 ​ 18,236 ​ 14,644 ​ 15,204 ​ 28,600 ​ 14,397 ​ 13,168 ​ 2,859 Interest expense ​ 275 ​ 288 ​ 247 ​ 256 ​ 224 ​ 226 ​ 223 ​ 232 Other (income) expense, net ​ (4,373) ​ (1,633) ​ (2,476) ​ (2,734) ​ (1,671) ​ 231 ​ 145 ​ 46 Income before income taxes ​ 41,741 ​ 19,581 ​ 16,873 ​ 17,682 ​ 30,047 ​ 13,940 ​ 12,800 ​ 2,581 Income tax expense (benefit) ​ 8,636 ​ 6,234 ​ 4,034 ​ 5,507 ​ 11,979 ​ 3,609 ​ 2,510 ​ (1,998) Net income ​ $ 33,105 ​ $ 13,347 ​ $ 12,839 ​ $ 12,175 ​ $ 18,068 ​ $ 10,331 ​ $ 10,290 ​ $ 4,579 ​ The following table sets forth our unaudited consolidated results of operations for the specified periods as a percentage of revenue: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ Dec 31, ​ ​ Sep 30, ​ ​ Jun 30, ​ ​ Mar 31, ​ ​ Dec 31, ​ ​ Sep 30, ​ ​ Jun 30, ​ ​ Mar 31, ​ ​ 2023 ​ 2023 ​ ​ 2023 ​ ​ 2023 ​ ​ 2022 ​ ​ 2022 ​ ​ 2022 ​ ​ 2022 ​ ​ ​ (as % of Revenue) Revenue 100 % ​ 100 % ​ 100 % ​ 100 % ​ 100 % ​ 100 % ​ 100 % ​ 100 % Cost of revenue (exclusive of depreciation and amortization shown separately below) 17 ​ 18 ​ ​ 20 ​ ​ 20 ​ ​ 17 ​ ​ 17 ​ ​ 17 ​ ​ 17 ​ Product development 19 ​ 22 ​ ​ 24 ​ ​ 23 ​ ​ 20 ​ ​ 21 ​ ​ 21 ​ ​ 22 ​ Sales, marketing and customer support 21 ​ 23 ​ ​ 24 ​ ​ 21 ​ ​ 22 ​ ​ 24 ​ ​ 23 ​ ​ 28 ​ General and administrative 14 ​ 16 ​ ​ 15 ​ ​ 16 ​ ​ 14 ​ ​ 17 ​ ​ 20 ​ ​ 20 ​ Depreciation and amortization 7 ​ 7 ​ ​ 7 ​ ​ 7 ​ ​ 7 ​ ​ 7 ​ ​ 8 ​ ​ 9 ​ Income from operations 22 ​ 13 ​ ​ 11 ​ ​ 12 ​ ​ 21 ​ ​ 13 ​ ​ 12 ​ ​ 3 ​ Interest expense — ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ Other (income) expense, net (3) ​ (1) ​ ​ (2) ​ ​ (2) ​ ​ (1) ​ ​ — ​ ​ — ​ ​ — ​ Income before income taxes 24 ​ 14 ​ ​ 13 ​ ​ 14 ​ ​ 22 ​ ​ 12 ​ ​ 12 ​ ​ 3 ​ Income tax expense (benefit) 5 ​ 4 ​ ​ 3 ​ ​ 4 ​ ​ 9 ​ ​ 3 ​ ​ 2 ​ ​ (2) ​ Net income 19 % ​ 9 % ​ 10 % ​ 10 % ​ 14 % ​ 9 % ​ 9 % ​ 5 % ​ Note: Percentages may not sum due to rounding. 56 Table of Contents The following table presents a reconciliation of Adjusted EBITDA, a non-GAAP financial measure, to the most directly comparable financial measure prepared in accordance with GAAP. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ Dec 31, ​ Sep 30, ​ Jun 30, ​ Mar 31, ​ Dec 31, ​ Sep 30, ​ Jun 30, ​ Mar 31, ​ 2023 2023 2023 2023 2022 2022 2022 2022 ​ (In Thousands) Net income $ 33,105 ​ $ 13,347 ​ $ 12,839 ​ $ 12,175 ​ $ 18,068 ​ $ 10,331 ​ $ 10,290 ​ $ 4,579 Net income margin 19% ​ 9% ​ 10% ​ 10% ​ 14% ​ 9% ​ 9% ​ 5% Depreciation and amortization 11,520 ​ 10,706 ​ 9,676 ​ 8,983 ​ 8,882 ​ 8,089 ​ 8,317 ​ 9,040 Stock-based compensation 16,473 ​ 15,791 ​ 15,167 ​ 11,813 ​ 11,083 ​ 10,971 ​ 9,259 ​ 10,994 Interest expense 275 ​ 288 ​ 247 ​ 256 ​ 224 ​ 226 ​ 223 ​ 232 Income tax expense (benefit) 8,636 ​ 6,234 ​ 4,034 ​ 5,507 ​ 11,979 ​ 3,609 ​ 2,510 ​ (1,998) M&A and restructuring (recoveries) costs (359) ​ 921 ​ 700 ​ — ​ 5 ​ 39 ​ 527 ​ 653 Offering, IPO readiness and secondary offering costs 315 ​ 286 ​ 122 ​ 187 ​ 566 ​ 726 ​ — ​ — Other (recoveries) costs (164) ​ (267) ​ (266) ​ (267) ​ (245) ​ (228) ​ 2,690 ​ 1,197 Other (income) expense (4,373) ​ (1,633) ​ (2,476) ​ (2,734) ​ (1,671) ​ 231 ​ 145 ​ 46 Adjusted EBITDA $ 65,428 ​ $ 45,673 ​ $ 40,043 ​ $ 35,920 ​ $ 48,891 ​ $ 33,994 ​ $ 33,961 ​ $ 24,743 Adjusted EBITDA margin 38% ​ 32% ​ 30% ​ 29% ​ 37% ​ 30% ​ 31% ​ 26% ​ Liquidity and Capital Resources The Company’s operations are financed primarily through cash generated from operations.
Biggest changeWe believe that the year-over-year comparison of results more appropriately reflects the overall performance of the business. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ Dec 31, ​ Sep 30, ​ Jun 30, ​ Mar 31, ​ Dec 31, ​ Sep 30, ​ Jun 30, ​ Mar 31, ​ 2024 2024 2024 2024 2023 2023 2023 2023 ​ ​ (In Thousands) Revenue ​ $ 190,621 $ 169,556 $ 155,890 $ 140,782 $ 172,231 $ 143,974 $ 133,744 $ 122,594 Cost of revenue (exclusive of depreciation and amortization shown separately below) ​ 34,316 ​ 29,479 ​ 26,102 ​ 26,618 ​ 30,022 ​ 26,466 ​ 26,191 ​ 23,952 Product development ​ 37,540 ​ 39,306 ​ 39,806 ​ 36,394 ​ 32,565 ​ 32,315 ​ 31,941 ​ 28,555 Sales, marketing and customer support ​ 44,246 ​ 40,525 ​ 44,863 ​ 37,872 ​ 35,733 ​ 32,971 ​ 31,537 ​ 25,712 General and administrative ​ 23,967 ​ 23,039 ​ 23,066 ​ 22,075 ​ 24,748 ​ 23,280 ​ 19,755 ​ 20,188 Depreciation and amortization ​ 11,800 ​ 11,483 ​ 11,004 ​ 10,928 ​ 11,520 ​ 10,706 ​ 9,676 ​ 8,983 Income from operations ​ 38,752 ​ 25,724 ​ 11,049 ​ 6,895 ​ 37,643 ​ 18,236 ​ 14,644 ​ 15,204 Interest expense ​ 300 ​ 353 ​ 233 ​ 232 ​ 275 ​ 288 ​ 247 ​ 256 Other expense (income), net ​ 1,073 ​ (4,225) ​ (2,064) ​ (2,272) ​ (4,373) ​ (1,633) ​ (2,476) ​ (2,734) Income before income taxes ​ 37,379 ​ 29,596 ​ 12,880 ​ 8,935 ​ 41,741 ​ 19,581 ​ 16,873 ​ 17,682 Income tax expense ​ 13,979 ​ 11,395 ​ 5,406 ​ 1,779 ​ 8,636 ​ 6,234 ​ 4,034 ​ 5,507 Net income ​ $ 23,400 ​ $ 18,201 ​ $ 7,474 ​ $ 7,156 ​ $ 33,105 ​ $ 13,347 ​ $ 12,839 ​ $ 12,175 ​ 57 Table of Contents The following table sets forth our unaudited consolidated results of operations for the specified periods as a percentage of revenue: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ Dec 31, ​ ​ Sep 30, ​ ​ Jun 30, ​ ​ Mar 31, ​ ​ Dec 31, ​ ​ Sep 30, ​ ​ Jun 30, ​ ​ Mar 31, ​ ​ 2024 ​ 2024 ​ ​ 2024 ​ ​ 2024 ​ ​ 2023 ​ ​ 2023 ​ ​ 2023 ​ ​ 2023 ​ ​ ​ (as % of Revenue) Revenue 100 % ​ 100 % ​ 100 % ​ 100 % ​ 100 % ​ 100 % ​ 100 % ​ 100 % Cost of revenue (exclusive of depreciation and amortization shown separately below) 18 ​ 17 ​ ​ 17 ​ ​ 19 ​ ​ 17 ​ ​ 18 ​ ​ 20 ​ ​ 20 ​ Product development 20 ​ 23 ​ ​ 26 ​ ​ 26 ​ ​ 19 ​ ​ 22 ​ ​ 24 ​ ​ 23 ​ Sales, marketing and customer support 23 ​ 24 ​ ​ 29 ​ ​ 27 ​ ​ 21 ​ ​ 23 ​ ​ 24 ​ ​ 21 ​ General and administrative 13 ​ 14 ​ ​ 15 ​ ​ 16 ​ ​ 14 ​ ​ 16 ​ ​ 15 ​ ​ 16 ​ Depreciation and amortization 6 ​ 7 ​ ​ 7 ​ ​ 8 ​ ​ 7 ​ ​ 7 ​ ​ 7 ​ ​ 7 ​ Income from operations 20 ​ 15 ​ ​ 7 ​ ​ 5 ​ ​ 22 ​ ​ 13 ​ ​ 11 ​ ​ 12 ​ Interest expense — ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ Other expense (income), net 1 ​ (2) ​ ​ (1) ​ ​ (2) ​ ​ (3) ​ ​ (1) ​ ​ (2) ​ ​ (2) ​ Income before income taxes 20 ​ 17 ​ ​ 8 ​ ​ 6 ​ ​ 24 ​ ​ 14 ​ ​ 13 ​ ​ 14 ​ Income tax expense 7 ​ 7 ​ ​ 3 ​ ​ 1 ​ ​ 5 ​ ​ 4 ​ ​ 3 ​ ​ 4 ​ Net income 12 % ​ 11 % ​ 5 % ​ 5 % ​ 19 % ​ 9 % ​ 10 % ​ 10 % ​ Note: Percentages may not sum due to rounding.
New Geographies. Our customer base is predominately U.S.-based today. We intend to grow our presence in international markets in order to meet the needs of our existing customers and accelerate new customer acquisition in key geographies outside of North America.
Our customer base is predominately U.S.-based today. We intend to grow our presence in international markets in order to meet the needs of our existing customers and accelerate new customer acquisition in key geographies outside of North America.
Further, the Company has latitude in establishing the sales price with those customers as there is a fixed retail rate card that is included in the product integration agreements with the Demand-Side Platforms or are governed by contracts in place with the customers.
Further, the Company has latitude in establishing the sales price with those customers as there is a fixed retail rate card that is included in the product integration agreements with the Demand-Side Platforms or are governed by contracts in place directly with the customers.
These inputs are subjective and generally requires significant judgment and estimation by management. 61 Table of Contents ● Expected Term: we have opted to use the “simplified method” for estimating the expected term of employee options, whereby the expected term equals the arithmetic average of the vesting term and the original contractual term of the option, generally 10 years. ● Expected Volatility: we have based our estimate of expected volatility on the historical stock volatility of a group of similar companies that are publicly traded over a period equivalent to the expected term of the stock-based awards. ● Risk-Free Interest Rate: the risk-free rate assumption is based on the U.S.
These inputs are subjective and generally requires significant judgment and estimation by management. ● Expected Term: We have opted to use the “simplified method” for estimating the expected term of employee options, whereby the expected term equals the arithmetic average of the vesting term and the original contractual term of the option, generally 10 years. ● Expected Volatility: We have based our estimate of expected volatility on the historical stock volatility of a group of similar companies that are publicly traded over a period equivalent to the expected term of the stock-based awards. ● Risk-Free Interest Rate: The risk-free rate assumption is based on the U.S.
We deliver unique data analytics through our customer interface, DV Pinnacle, to provide detailed insights into our customers’ media performance on both direct and programmatic media buying platforms and across all key digital media channels, formats, and devices, with coverage spanning 110 countries where our customers activate our services.
We deliver unique data analytics through our customer interface, DV Pinnacle, to provide detailed insights into our customers’ media performance on both direct and programmatic media buying platforms and across all key digital media channels, formats, and devices, with coverage spanning 110 countries where our customers activate our solutions.
Discussion of historical items and year-to-year comparisons between 2022 and 2021 that are not included in this discussion can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2022.
Discussion of historical items and year-to-year comparisons between 2023 and 2022 that are not included in this discussion can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2023.
Our customers include many of the largest digital advertisers in the world and we have maintained exceptional customer retention with gross revenue retention rates of over 95% in each of the years ended December 31, 2023 and 2022.
Our customers include many of the largest digital advertisers in the world and we have maintained exceptional customer retention with gross revenue retention rates of over 95% in each of the years ended December 31, 2024 and 2023.
Accordingly, the Company records revenue for the gross amounts of the Measured Transaction Fees paid by advertisers for these services and records the amounts retained by the Demand-Side Platforms as a cost of revenue. 60 Table of Contents Goodwill and Intangibles Goodwill represents the excess of purchase price over the fair value of tangible net assets and identifiable intangible assets of the businesses acquired.
Accordingly, the Company records revenue for the gross amounts of the Measured Transaction Fees paid by advertisers for these services and records the amounts retained by the Demand-Side Platforms as a cost of revenue. Goodwill and Intangibles Goodwill represents the excess of purchase price over the fair value of tangible net assets and identifiable intangible assets of the businesses acquired.
Cost of revenue consists primarily of costs from revenue-sharing arrangements with our partners, platform hosting fees, data center costs, software and other technology expenses, other costs directly associated with data infrastructure, and personnel costs, including salaries, bonuses, stock-based compensation and benefits, directly associated with the support and delivery of our software platform and data solutions. 50 Table of Contents Product development.
Cost of revenue consists primarily of costs from revenue-sharing arrangements with our partners, platform hosting fees, data center costs, software and other technology expenses, other costs directly associated with data infrastructure, and personnel costs, including salaries, bonuses, stock-based compensation and benefits, directly associated with the support and delivery of our software platform and data solutions. Product development.
Selected Quarterly Results of Operations The following tables set forth our unaudited consolidated quarterly results of operations for each of the 8 quarters within the period from January 1, 2022 to December 31, 2023.
Selected Quarterly Results of Operations The following tables set forth our unaudited consolidated quarterly results of operations for each of the 8 quarters within the period from January 1, 2023 to December 31, 2024.
The ability to provide these services to customers requires that the Company enter into product integration agreements with Demand-Side Platforms who in turn make the Company’s services available to advertisers.
The ability to provide these solutions to customers requires that the Company enter into product integration agreements with Demand-Side Platforms who in turn make the Company’s solutions available to advertisers.
For certain arrangements, customers may purchase the Company’s service offering through a Demand-Side Platform that manages various ad campaign auctions and inventory on behalf of the advertisers. Customers elect to use the Company’s service of evaluating the quality of advertising inventory up for bid on an advertising exchange.
For certain arrangements, customers may purchase the Company’s solutions through a Demand-Side Platform that manages various ad campaign auctions and inventory on behalf of the advertisers. Customers elect to use the Company’s solutions for evaluating the quality of advertising inventory up for bid on an advertising exchange.
In November 2020, the Concurrent Private Placement Investors invested in the Company in the Concurrent Private Placement at a total enterprise value (the “Total Enterprise Value”) based on arm’s length negotiations, which resulted in a per share valuation of $17.22 (adjusted for the reverse stock split).
In November 2020, private placement investors invested in the Company at a total enterprise value (the “Total Enterprise Value”) based on arm’s length negotiations, which resulted in a per share valuation of $17.22, adjusted for the reverse stock split (“Concurrent Private Placement”).
Based on the Total Enterprise Value from the Concurrent Private Placement and our board of directors’ belief that it is customary and standard practice for high growth companies in the Company’s industry to use a revenue multiplier to value a company, our board of directors determined that the most appropriate representation of the value of the Company was to attribute value based on LTM Revenue multiplied by 14, less a Liquidity Discount.
Based on the Total Enterprise Value and our board of directors’ belief that it is customary and standard practice for high growth companies in the Company’s industry to use a revenue multiplier to value a company, our board of directors determined that the most appropriate representation of the value of the Company was to attribute value based on LTM Revenue multiplied by 14, less a Liquidity Discount.
In the year ended December 31, 2022, the revenue we generated by providing our activation solutions through programmatic and social integrations and our measurement solutions through social integrations grew 50% and 28%, respectively, over the prior year period. 48 Table of Contents Growth of Existing Customers.
In the year ended December 31, 2023, the revenue we generated by providing our activation solutions through programmatic and social integrations and our measurement solutions through social integrations grew 31% and 48%, respectively, over the prior year period. 50 Table of Contents Growth of Existing Customers.
For the years ended December 31, 2023 and 2022, we generated 8% and 10% of our revenue, respectively, from supply-side customers who use our data analytics to validate the quality of their ad inventory and provide data to their customers to facilitate targeting and purchasing of digital ads, which we refer to as Supply-side revenue.
For the years ended December 31, 2024 and 2023, we generated 9% and 8% of our revenue, respectively, from supply-side customers who use our data analytics to validate the quality of their ad inventory and provide data to their customers to facilitate targeting and purchasing of digital ads, which we refer to as Supply-side revenue.
You should compensate for these limitations by relying primarily on the Company’s GAAP results and using the non-GAAP financial measures only supplementally. ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ 2023 2022 Advertiser revenue retention: ​ ​ ​ Gross revenue retention ​ > 95% ​ > 95% Net revenue retention 124% 127% ​ New Solutions and Channels.
You should compensate for these limitations by relying primarily on the Company’s GAAP results and using the non-GAAP financial measures only supplementally. ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ 2024 2023 Advertiser revenue retention: ​ ​ ​ Gross revenue retention ​ > 95% ​ > 95% Net revenue retention 112% 124% ​ New Solutions and Channels.
The increase was due primarily to an increase in personnel costs, including stock-based compensation and sales commissions, of $13.6 million to support sales and account management efforts globally, and drive continued expansion with existing and new customers.
The increase was due primarily to an increase in personnel costs, including stock-based compensation and sales commissions, of $32.2 million to support sales and account management efforts globally, and drive continued expansion with existing and new customers.
For each of the years ended December 31, 2023 and December 31, 2022, there were no impairments related to our intangible assets. We allocate the fair value of the purchase consideration to the tangible assets acquired, liabilities assumed and intangible assets acquired based on their estimated fair values.
For each of the years ended December 31, 2024 and December 31, 2023, there were no impairments related to our intangible assets. 62 Table of Contents We allocate the fair value of the purchase consideration to the tangible assets acquired, liabilities assumed and intangible assets acquired based on their estimated fair values.
At the end of 2018, we launched our Authentic Brand Suitability solution that allows advertisers to create a centralized set of brand suitability controls that can be automatically deployed across multiple programmatic buying platforms and campaigns. Authentic Brand Suitability, which significantly reduces wasted ad spend, generated $182.0 million and $123.3 million of revenue in 2023 and 2022, respectively.
At the end of 2018, we launched our Authentic Brand Suitability solution that allows advertisers to create a centralized set of brand suitability controls that can be automatically deployed across multiple programmatic buying platforms and campaigns. Authentic Brand Suitability, which significantly reduces wasted ad spend, generated $199.0 million and $182.0 million of revenue in 2024 and 2023, respectively. New Geographies.
The increase was due primarily to growth in Activation (f/k/a Advertiser – programmatic) revenue which drove increases in partner costs from revenue-sharing arrangements, as well as investments in cloud services to provide scale and flexibility necessary to support future growth.
The increase was due primarily to growth in Activation revenue which drove increases in partner costs from revenue-sharing arrangements, as well as investments in cloud services to provide the scale and flexibility necessary to support future growth.
Marketing activities, including advertising, promotions, events and other activities, increased $1.1 million, and personnel travel and entertainment expenses to support marketing and sales activities increased $1.6 million.
Personnel travel and entertainment expenses to support marketing and sales activities increased $3.1 million, and marketing activities, including advertising, promotions, events and other activities, increased $1.0 million.
Revenue Recognition In accordance with ASC 606, Revenue from Contracts with Customers, the Company recognizes revenue under the core principle to depict the transfer of control to its customers in an amount reflecting the consideration to which it expected to be entitled.
Revenue Recognition In accordance with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers, the Company recognizes revenue under the core principle to depict the transfer of control to its customers in an amount reflecting the consideration to which it expected to be entitled.
With offices or commercial operations in 30 locations across 24 countries, our expansion to new geographies has helped us to win the international business of our existing customers and to establish relationships with some of the world’s largest international advertisers. As of December 31, 2023, 453 of our employees were based outside of the Americas.
With offices or commercial operations in 31 locations across 25 countries, our expansion to new geographies has helped us to win the international business of our existing customers and to establish relationships with some of the world’s largest international advertisers. As of December 31, 2024, 499 of our employees were based outside of the Americas.
The following generally discusses 2023 and 2022 items and year-to-year comparisons between 2023 and 2022.
The following generally discusses 2024 and 2023 items and year-to-year comparisons between 2024 and 2023.
Product development expenses are expensed as incurred, except to the extent that such costs are associated with software development that qualifies for capitalization, which are then recorded as capitalized software development costs included in Property, plant and equipment, net on our Consolidated Balance Sheets. Capitalized software development costs are amortized to depreciation and amortization. Sales, marketing, and customer support.
Product development expenses are expensed as incurred, except to the extent that such costs are associated with software development that qualifies for capitalization, which are then recorded as capitalized software development costs included in Property, plant and equipment, net on our Consolidated Balance Sheets.
Further, our services are not reliant on any single source of impressions and we can service our customers as their digital advertising needs change. In 2023, we estimate that approximately 52% and 48% of Media Transactions Measured within post-campaign measurement were for display and for video ad formats, respectively.
Further, our solutions are not reliant on any single source of impressions and we can service our customers as their digital advertising needs change. In 2024, we estimate that approximately 44% and 56% of Media Transactions Measured within post-campaign measurement were for display and for video ad formats, respectively.
We have generated strong historical net revenue retention rates, with 124% for the year ended December 31, 2023 and 127% for the year ended December 31, 2022.
We have generated strong historical net revenue retention rates, with 112% for the year ended December 31, 2024 and 124% for the year ended December 31, 2023.
Our collection and payment cycles can vary from period to period. For the year ended December 31, 2023, cash provided by operating activities was $119.7 million, attributable to net income of $71.5 million, adjusted for non-cash charges of $91.6 million and net cash outflows of $43.3 million used in changes in operating assets and liabilities.
For the year ended December 31, 2023, cash provided by operating activities was $119.7 million, attributable to net income of $71.5 million, adjusted for non-cash charges of $91.6 million and net cash outflows of $43.3 million used in changes in operating assets and liabilities.
As of December 31, 2023, the Company had cash of $310.1 million and net working capital, consisting of current assets (excluding cash) less current liabilities, of $139.0 million. As of December 31, 2022, the Company had cash of $267.8 million and net working capital, consisting of current assets (excluding cash) less current liabilities, of $108.4 million.
As of December 31, 2023, the Company had cash of $310.1 million and net working capital, consisting of current assets (excluding cash and cash equivalents) less current liabilities, of $139.0 million.
M&A and restructuring costs for the year ended December 31, 2022 consist of transaction costs, integration and restructuring costs related to the acquisition of OpenSlate. (b) Offering, IPO readiness and secondary offering costs for the year ended December 31, 2023 consist of third-party costs incurred for underwritten secondary public offerings by certain stockholders of the Company.
M&A and restructuring costs for the year ended December 31, 2023 consist of transaction costs related to the acquisition of Scibids. (b) Offering and secondary offering costs for the years ended December 31, 2024 and December 31, 2023 consist of third-party costs incurred for underwritten secondary public offerings by certain stockholders of the Company.
Supply-side revenue increased $2.3 million, or 5%, driven primarily by an increase in revenue from existing and new platform customers. Cost of Revenue (exclusive of depreciation and amortization shown below) Cost of revenue increased by $28.8 million, or 37%, from $77.9 million in the year ended December 31, 2022 to $106.6 million in the year ended December 31, 2023.
Supply-side revenue increased by $11.2 million, or 25%, driven primarily by an increase in revenue from existing and new platform customers. Cost of Revenue (exclusive of depreciation and amortization shown below) Cost of revenue increased by $9.9 million, or 9%, from $106.6 million in the year ended December 31, 2023 to $116.5 million in the year ended December 31, 2024.
Financing Activities For the year ended December 31, 2023, cash provided by financing activities of $6.5 million was due primarily to $10.7 million of proceeds from common stock issued upon the exercise of stock options, offset by $4.6 million related to shares repurchased for settlement of employee tax withholdings.
Financing Activities For the year ended December 31, 2024, cash used in financing activities of $129.5 million was due primarily to $128.0 million related to shares repurchased under the Repurchase Program. 60 Table of Contents For the year ended December 31, 2023, cash provided by financing activities of $6.5 million was due primarily to $10.7 million of proceeds from common stock issued upon the exercise of stock options, offset by $4.6 million related to shares repurchased for settlement of employee tax withholdings.
Recent Accounting Pronouncements See Note 2, Basis of Presentation and Summary of Significant Accounting Policies to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K for more information on the adoption of recent accounting pronouncements. 63 Table of Contents ​
Interest and penalties are recognized as part of income tax expense. 64 Table of Contents Recent Accounting Pronouncements See Note 2, Basis of Presentation and Summary of Significant Accounting Policies to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K for more information on the adoption of recent accounting pronouncements. 65 Table of Contents ​
While the factors above may present significant opportunities for us, they also pose significant risks and challenges. See “Risk Factors” for more information on risks and uncertainties that may impact our business and financial results.
While the factors above may present significant opportunities for us, they also pose significant risks and challenges. See “Risk Factors” for more information on risks and uncertainties that may impact our business and financial results. Components of Our Results of Operations We manage our business operations and report our financial results in a single segment.
We have experienced rapid growth and achieved significant profitability in recent years as evidenced by the following: ● We generated revenue of $572.5 million for the year ended December 31, 2023 and $452.4 million for the year ended December 31, 2022, representing an increase of 27%. ● Our net income was $71.5 million for the year ended December 31, 2023 and $43.3 million for the year ended December 31, 2022. ● Our Adjusted EBITDA was $187.1 million for the year ended December 31, 2023 and $141.6 million for the year ended December 31, 2022.
We have experienced rapid growth and achieved significant profitability in recent years as evidenced by the following: ● We generated revenue of $656.8 million for the year ended December 31, 2024 and $572.5 million for the year ended December 31, 2023, representing an increase of 15%. ● Our net income was $56.2 million for the year ended December 31, 2024 and $71.5 million for the year ended December 31, 2023. ● Our Adjusted EBITDA was $218.9 million for the year ended December 31, 2024 and $187.1 million for the year ended December 31, 2023.
We generate revenue for certain supply-side arrangements that include minimum guaranteed fees that reset monthly and are recognized on a straight-line basis over the access period, which is usually twelve months.
We generate revenue for certain supply-side arrangements that include minimum guaranteed fees that reset monthly and are recognized on a straight-line basis over the access period, which is usually twelve months. For contracts that contain overages, once the minimum guaranteed amount is achieved, overages are recognized as earned over time based on a tiered pricing structure.
Cash Flows The following table summarizes our cash flows for the periods indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ 2023 2022 ​ ​ (In Thousands) Cash flows provided by operating activities ​ $ 119,741 ​ $ 94,862 Cash flows (used in) investing activities ​ (84,249) ​ (39,981) Cash flows provided by (used in) financing activities ​ 6,489 ​ (7,884) Effect of exchange rate changes on cash and cash equivalents and restricted cash ​ 338 ​ (784) Increase in cash, cash equivalents and restricted cash ​ $ 42,319 ​ $ 46,213 ​ Operating Activities Our cash flows from operating activities are influenced primarily by growth in our operations and by changes in our working capital.
Cash Flows The following table summarizes our cash flows for the periods indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ 2024 2023 ​ ​ (In Thousands) Cash flows provided by operating activities ​ $ 159,664 ​ $ 119,741 Cash flows (used in) investing activities ​ (44,841) ​ (84,249) Cash flows (used in) provided by financing activities ​ (129,450) ​ 6,489 Effect of exchange rate changes on cash and cash equivalents and restricted cash ​ (1,889) ​ 338 (Decrease) increase in cash, cash equivalents and restricted cash ​ $ (16,516) ​ $ 42,319 ​ Operating Activities Our cash flows from operating activities are influenced primarily by growth in our operations and by changes in our working capital.
As the global digital advertising market has evolved, we have continued to expand our measurement capabilities and market coverage through new product innovation, increasing our international footprint and new platform partnerships. We announced our first social media platform partnership in 2017 and launched our CTV certification program in 2020.
As the global digital advertising market has evolved, we have continued to expand our measurement capabilities and market coverage through new product innovation, increasing our international footprint and new platform partnerships.
Changes in our strategy or market conditions could significantly impact these judgments and require an impairment to be recorded to intangible assets and goodwill. There have been no goodwill impairment indicators subsequent to the impairment test performed as of October 1, 2023.
Changes in our strategy or market conditions could significantly impact these judgments and require an impairment to be recorded to intangible assets and goodwill. As of October 1, 2024, there were no impairment indicators of goodwill, with no impairment indicators present as of December 31, 2024.
We maintain an expansive set of direct integrations across the entire digital advertising ecosystem, including with leading programmatic, CTV, and social platforms, which enable us to deliver our metrics to the platforms where our customers buy ads.
On platforms that charge based on percent of media spend, our pricing includes caps which effectively mirror our standard fixed fees. We maintain an expansive set of direct integrations across the entire digital advertising ecosystem, including with leading programmatic, social platforms, and CTV, which enable us to deliver our metrics to the platforms where our customers buy ads.
We generate revenue from our advertising customers based on the volume of Media Transactions Measured on our software platform, and for supply-side customers, based on contracts with minimum guarantees or contracts that have tiered pricing after minimum guarantees are achieved.
We generate revenue from our advertising customers based primarily on the volume of Media Transactions Measured on our software platform, and for supply-side customers, based on contracts with minimum guarantees or contracts that have tiered pricing after minimum guarantees are achieved. 51 Table of Contents For the years ended December 31, 2024 and 2023, we generated 91% and 92% of our revenue, respectively, from advertiser customers.
Customers purchase our social activation solutions directly from us, and our programmatic activation solutions through Demand-Side Platforms that manage ad campaign auctions and inventories on their behalf. We enter into product integration agreements with our Demand-Side Platform partners.
For Activation revenue, our customers can elect to use our solutions for evaluating the quality of advertising they are considering purchasing. Customers purchase our social activation solutions directly from us, and our programmatic activation solutions through Demand-Side Platforms that manage ad campaign auctions and inventories on their behalf. We enter into product integration agreements with our Demand-Side Platform partners.
We believe that these non-GAAP financial measures are useful to investors for period to period comparisons of our core business and for understanding and evaluating trends in operating results on a consistent basis by excluding items that we do not believe are indicative of our core operating performance.
We believe that these non-GAAP financial measures are useful to investors for period to period comparisons of our core business and for understanding and evaluating trends in operating results on a consistent basis by excluding items that we do not believe are indicative of our core operating performance. 56 Table of Contents These non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as substitutes for an analysis of our results as reported under GAAP.
Factors Affecting Our Performance There are a number of factors that have impacted, and we believe will continue to impact, our results of operations and growth. These factors include: Significant Growth in Digital Ad Spend.
Factors Affecting Our Performance There are a number of factors that have impacted, and we believe will continue to impact, our results of operations and growth. These factors include: Significant Growth in Digital Ad Spend. Magna Global estimated that global digital ad spend, excluding search, reached $329 billion in 2024 and is expected to grow to $448 billion by 2028.
For volume-based discounts applied prospectively, the Company evaluates each contract to determine if the discount represents a material right which would be recognized as a separate performance obligation. ​ For transactions that involve third parties, the Company evaluates which party in the arrangement obtains control of the Company’s services (and is therefore the Company’s customer), which impacts whether the Company reports revenue as the gross amounts paid by the advertiser through the Demand-Side Platform or the net amount paid by the Company’s Demand-Side Platform partners.
For transactions that involve third parties, the Company evaluates which party in the arrangement obtains control of the Company’s services (and is therefore the Company’s customer), which impacts whether the Company reports revenue as the gross amounts paid by the advertiser through the Demand-Side Platform or the net amount paid by the Company’s Demand-Side Platform partners.
In order to achieve that core principle, the Company applies the following five-step approach: (1) identify the contract with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when a performance obligation is satisfied. 59 Table of Contents For Measurement (f/k/a Advertiser – direct) revenue, our contracts with our customers typically consist of the various ad measurement services that we offer.
In order to achieve that core principle, the Company applies the following five-step approach: (1) identify the contract with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when a performance obligation is satisfied.
We plan to continue to invest in the development of new and premium solutions that increase our value proposition to customers and to extend our solutions capabilities to cover new and growing digital media environments, channels and devices, including CTV, new mobile apps and other emerging areas of digital ad spend.
We believe that there are meaningful long-term growth opportunities within the digital advertising market. We plan to continue to invest in new performance and protection solutions that increase our value proposition to customers and expand our capabilities across new and growing digital media environments, channels and devices, including CTV, new mobile apps and other emerging areas of digital ad spend.
The New Revolving Credit Facility bears interest at SOFR plus an applicable margin per annum. See “Liquidity and Capital Resources—Debt Obligations.” Other (income) expense.
The New Revolving Credit Facility bears interest at an option of Secured Overnight Financing Rate (“SOFR”) or Alternate Base Rate (“ABR”) plus an applicable margin per annum. See “Liquidity and Capital Resources—Debt Obligations.” Other income, net.
The following table presents a reconciliation of Adjusted EBITDA, a non-GAAP financial measure, to the most directly comparable financial measure prepared in accordance with GAAP. ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ 2023 2022 ​ (In Thousands) Net income $ 71,466 ​ $ 43,268 Net income margin 12% ​ 10% Depreciation and amortization 40,885 ​ 34,328 Stock-based compensation 59,244 ​ 42,307 Interest expense 1,066 ​ 905 Income tax expense 24,411 ​ 16,100 M&A and restructuring costs (a) 1,262 ​ 1,224 Offering, IPO readiness and secondary offering costs (b) 910 ​ 1,292 Other (recoveries) costs (c) (964) ​ 3,414 Other income (d) (11,216) ​ (1,249) Adjusted EBITDA $ 187,064 ​ $ 141,589 Adjusted EBITDA margin 33% ​ 31% ​ (a) M&A and restructuring costs for the year ended December 31, 2023 consist of transaction costs related to the acquisition of Scibids.
The following table presents a reconciliation of Adjusted EBITDA, a non-GAAP financial measure, to the most directly comparable financial measure prepared in accordance with GAAP. ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ 2024 2023 ​ (In Thousands) Net income $ 56,231 ​ $ 71,466 Net income margin 9% ​ 12% Depreciation and amortization 45,215 ​ 40,885 Stock-based compensation 90,658 ​ 59,244 Interest expense 1,118 ​ 1,066 Income tax expense 32,559 ​ 24,411 M&A and restructuring costs (a) 537 ​ 1,262 Offering and secondary offering costs (b) 68 ​ 910 Other recoveries (c) — ​ (964) Other income (d) (7,488) ​ (11,216) Adjusted EBITDA $ 218,898 ​ $ 187,064 Adjusted EBITDA margin 33% ​ 33% ​ (a) M&A and restructuring costs for the year ended December 31, 2024 consist of transaction costs related to the agreement to acquire Rockerbox, Inc.
Activation (f/k/a Advertiser – programmatic) revenue increased by $77.7 million, or 31%, driven primarily by greater adoption of our Authentic Brand Suitability (ABS) solution, as well as by new customers activating our non-ABS activation solutions, including Scibids. 52 Table of Contents Measurement (f/k/a Advertiser – direct) revenue increased by $40.1 million, or 25%, driven primarily by greater adoption of our social measurement solutions across emerging platforms and formats including short-form video.
Activation revenue increased by $44.2 million, or 13%, driven primarily by new customers activating our core programmatic solutions, including Scibids, as well as greater adoption of our Authentic Brand Suitability (ABS) solution. Measurement revenue increased by $28.9 million, or 15%, driven primarily by greater adoption of our social measurement solutions across emerging platforms and formats including short-form video.
Fair Value of Common Stock Historical Valuation Approach Given the absence of a public trading market for our common stock prior to our IPO, our board of directors exercised reasonable judgment and considered a number of objective and subjective factors to determine the best estimate of the fair value of our common stock, including, with input from management, our financial and operating history, equity market conditions affecting comparable public companies, and the lack of marketability of our common stock.
Fair Value of Common Stock Historical Valuation Approach Given the absence of a public trading market for our common stock prior to our IPO, our board of directors exercised reasonable judgment and considered a number of objective and subjective factors to determine the best estimate of the fair value of our common stock, including, with input from management, our financial and operating history, equity market conditions affecting comparable public companies, and the lack of marketability of our common stock. 63 Table of Contents In addition, our board of directors considered valuations of our common stock prepared by an unrelated third-party valuation firm in accordance with the guidance provided by the American Institute of Certified Public Accountants Practice Guide, Valuation of Privately-Held-Company Equity Securities Issued as Compensatio n.
The LTM Revenue utilized in the per share valuation for the Concurrent Private Placement was the twelve months ended September 30, 2020, which was the most recent month ended prior to the Company entering into a definitive agreement for the Concurrent Private Placement and the most recent historical financial information provided to the Concurrent Private Placement Investors. 62 Table of Contents For grants of stock options and RSUs subsequent to closing of the Concurrent Private Placement (summarized above), our board of directors continued to utilize this formula of (LTM Revenue × 14) x Liquidity Discount.
The LTM Revenue utilized in the per share valuation was the twelve months ended September 30, 2020, which was the most recent month ended prior to the Company entering into a definitive agreement for the Concurrent Private Placement and the most recent historical financial information provided to the Concurrent Private Placement investors.
As the digital advertising market has grown, advertisers have increasingly shifted their digital media spend to both programmatic and social media channels in order to directly target advertisements to achieve desired business outcomes. We have been direct beneficiaries of this growth by virtue of our integrations with leading programmatic and social media platforms.
Our revenues have grown substantially as a result of the growth in digital advertising as well as the continued adoption of digital measurement solutions and analytics. As the digital advertising market has grown, advertisers have increasingly shifted their digital media spend to both programmatic and social media channels in order to directly target advertisements to achieve desired business outcomes.
Product Development Expenses Product development expenses increased by $30.3 million, or 32%, from $95.1 million in the year ended December 31, 2022 to $125.4 million in the year ended December 31, 2023.
Product Development Expenses Product development expenses increased by $27.7 million, or 22%, from $125.4 million in the year ended December 31, 2023 to $153.0 million in the year ended December 31, 2024.
Interest expense. Interest expense for the years ended December 31, 2023 and 2022, consists primarily of debt issuance costs, commitment fees associated with the unused portion of the New Revolving Credit Facility, interest on balances that were outstanding under the New Revolving Credit Facility and interest on finance leases.
Interest expense consists primarily of the amortization of debt issuance costs, commitment fees associated with the unused portion of the New Revolving Credit Facility and the Company’s prior senior secured revolving credit facility, dated as of October 1, 2020 (the “Prior Revolving Credit Facility”), interest on balances that were outstanding under the Prior Revolving Credit Facility and interest on finance leases.
In the year ended December 31, 2023, the revenue we generated by providing our activation solutions through programmatic and social integrations and our measurement solutions through social integrations grew 31% and 48%, respectively, over the prior year period.
We have been direct beneficiaries of this growth by virtue of our integrations with leading programmatic and social media platforms. In the year ended December 31, 2024, the revenue we generated by providing our activation solutions through programmatic and social integrations and our measurement solutions through social integrations grew 13% and 27%, respectively, over the prior year period.
Included in these services is access to our software platform that allows customers to access and manage their data related to our services. We deliver our services together when media transactions are measured and primarily charge a contractually fixed Measured Transaction Fee per 1,000 impressions on the number of Media Transactions Measured.
We deliver our solutions together when media transactions are measured and primarily charge a contractually fixed Measured Transaction Fee per 1,000 impressions on the number of Media Transactions Measured.
For the years ended December 31, 2023 and 2022, we generated 92% and 90% of our revenue, respectively, from advertiser customers. Advertisers can purchase our services to measure the quality and performance of ads after they are purchased directly from digital properties, including publishers and social media platforms, which we track as Measurement (f/k/a Advertiser – direct) revenue.
Advertisers can also purchase our solutions to measure the quality and performance of ads after they are purchased directly or programmatically from digital properties, including publishers and social media platforms, which we track as Measurement revenue.
Accrued expenses and other liabilities include the benefit of $8.7 million tenant improvement allowance received from the landlord of the Company’s new global headquarters and income taxes of $10.6 million. 58 Table of Contents Investing Activities For the year ended December 31, 2023, cash used in investing activities was $84.2 million, including $67.2 million attributable to the acquisition of Scibids and $17.0 million attributable to purchases of property, plant and equipment, and capitalized software development costs.
For the year ended December 31, 2023, cash used in investing activities was $84.2 million, including $67.2 million attributable to the acquisition of Scibids and $17.0 million attributable to purchases of property, plant and equipment, and capitalized software development costs.
Sales, marketing, and customer support expenses consist primarily of personnel costs directly associated with sales, marketing, and customer support departments, including salaries, bonuses, commissions, stock-based compensation and benefits, and allocated overhead. Overhead costs such as information technology infrastructure, rent and occupancy charges are allocated based on headcount.
Capitalized software development costs are amortized to depreciation and amortization. 52 Table of Contents Sales, marketing, and customer support. Sales, marketing, and customer support expenses consist primarily of personnel costs directly associated with sales, marketing, and customer support departments, including salaries, bonuses, commissions, stock-based compensation and benefits, and allocated overhead.
Advertisers can also purchase our services through programmatic and social media platforms to evaluate the quality of ad inventories before they are purchased, which we track as Activation (f/k/a Advertiser – programmatic) revenue. We generate the majority of revenue from advertisers by charging a Measured Transaction Fee based on the volume of Media Transactions Measured on behalf of our customers.
Advertisers can purchase our solutions through programmatic and social media platforms to evaluate the quality of ad inventories before they are purchased, which we track as Activation revenue.
The main drivers of the changes in operating assets and liabilities were an increase in trade receivables and prepaid expenses and other assets of $40.7 million due to an increase in sales and the timing of cash receipts, and an increase of $19.5 million in trade payables and accrued expenses and other liabilities.
The main drivers of the changes in operating assets and liabilities were a $38.1 million increase in trade receivables, prepaid expenses and other assets due mainly to increases in sales and prepayments, offset by a $11.3 million increase in trade payables, and accrued expenses and other liabilities.
In 2022, approximately 55% and 45% of Media Transactions Measured were for display and for video ad formats, respectively. In 2023, approximately 78%, 17% and 5% of Media Transactions Measured were for mobile devices, desktop devices, and emerging digital channels, respectively.
In 2023, approximately 52% and 48% of Media Transactions Measured were for display and for video ad formats, respectively. In 2024, approximately 77%, 12% and 11% of Media Transactions Measured within post-campaign measurement were for mobile, desktop, and CTV devices, respectively. In 2023, approximately 78%, 17% and 5% of Media Transactions Measured were for mobile, desktop, and CTV devices, respectively.
Adjusted EBITDA is a non-GAAP financial measure. For information on how we compute Adjusted EBITDA and a reconciliation of Adjusted EBITDA to net income, see “Results of Operations — Adjusted EBITDA.” 47 Table of Contents For the years ended December 31, 2023 and December 31, 2022, we generated 92% and 90% of our revenue, respectively, from advertiser customers.
Adjusted EBITDA is a non-GAAP financial measure. For information on how we compute Adjusted EBITDA and a reconciliation of Adjusted EBITDA to net income, see “Results of Operations — Adjusted EBITDA.” 49 Table of Contents We derive revenue primarily from our advertiser customers based on the volume of media transactions, or ads, that our software platform measures (“Media Transactions Measured”).
Income Tax Expense Income tax expense increased by $8.3 million, from $16.1 million in the year ended December 31, 2022 to $24.4 million in the year ended December 31, 2023. The increase was due primarily to an increase in pre-tax book income.
The decrease was primarily due to a $4.3 million increase in losses from changes in foreign exchange rates, partially offset by an increase in interest income earned on monetary assets. Income Tax Expense Income tax expense increased by $8.1 million, from $24.4 million in the year ended December 31, 2023 to $32.6 million in the year ended December 31, 2024.
Non-cash charges consisted primarily of $34.3 million in depreciation and amortization, $42.3 million in stock-based compensation, and $7.3 million in non-cash lease expenses, offset by $19.6 million in deferred taxes.
Non-cash charges consisted primarily of $45.2 million in depreciation and amortization, $90.7 million in stock-based compensation, and $5.0 million in bad debt expense, offset by $21.7 million in deferred taxes.
Sales, Marketing and Customer Support Expenses Sales, marketing and customer support expenses increased by $18.5 million, or 17%, from $107.4 million in the year ended December 31, 2022 to $126.0 million in the year ended December 31, 2023.
General and Administrative Expenses General and administrative expenses increased by $4.2 million, or 5%, from $88.0 million in the year ended December 31, 2023 to $92.1 million in the year ended December 31, 2024.
For the year ended December 31, 2022, cash provided by operating activities was $94.9 million, attributable to net income of $43.3 million, adjusted for non-cash charges of $72.8 million and net cash outflows of $21.2 million used in changes in operating assets and liabilities.
Our collection and payment cycles can vary from period to period. For the year ended December 31, 2024, cash provided by operating activities was $159.7 million, attributable to net income of $56.2 million, adjusted for non-cash charges of $130.2 million and a $26.8 million use of cash from changes in operating assets and liabilities.
(d) Other income for the years ended December 31, 2023 and 2022 consists of interest income earned on interest-bearing monetary assets, changes in fair value associated with contingent consideration, and the impact of changes in foreign currency exchange rates. 54 Table of Contents We use Adjusted EBITDA and Adjusted EBITDA Margin as measures of operational efficiency to understand and evaluate our core business operations.
(c) Other recoveries for the year ended December 31, 2023 consist of sublease income for leased office space. (d) Other income for the years ended December 31, 2024 and 2023 consists of interest income earned on interest-bearing monetary assets, changes in fair value associated with contingent consideration, and the impact of changes in foreign currency exchange rates.
The increase was due primarily to an increase in personnel costs, including stock-based compensation, of $24.8 million and an increase in third party software costs and outsourced consulting and engineering services of $4.4 million to support our product development efforts.
The increase was due primarily to an increase in personnel costs, including stock-based compensation, of $22.1 million and an increase in third party software costs and outsourced consulting and engineering services of $5.5 million to support our product development efforts. 54 Table of Contents Sales, Marketing and Customer Support Expenses Sales, marketing and customer support expenses increased by $41.6 million, or 33%, from $126.0 million in the year ended December 31, 2023 to $167.5 million in the year ended December 31, 2024.
In October 2020, the Company entered into the New Revolving Credit Facility with available borrowings of $150 million. The Company had no outstanding debt under the New Revolving Credit Facility as of December 31, 2023.
As of December 31, 2023, there was no outstanding debt under the Prior Revolving Credit Facility. On August 12, 2024, the Company entered into the Credit Agreement providing for the New Revolving Credit Facility with available borrowings of $200.0 million, which matures on the Revolving Termination Date.
Certain customers receive cash-based incentives, credits, or discounts on the pricing of products or services once specific volume thresholds have been met. Where volume-based discounts are applied retrospectively, these amounts are accounted for as variable consideration which the Company estimates based on the expected consideration to be received by the customer.
Overages give rise to variable consideration that is allocated to the distinct periods to which the overage relates. Certain customers receive cash-based incentives, credits, or discounts on the pricing of products or services once specific volume thresholds have been met.
Other (income) expense consists primarily of interest earned on interest-bearing monetary assets, gains and losses on foreign currency transactions, and change in fair value associated with contingent consideration related to our acquisitions. 51 Table of Contents Results of Operations Comparison of the Years Ended December 31, 2023 and 2022 The following tables show our results of operations for the years ended December 31, 2023 and 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ ​ ​ ​ ​ ​ December 31, ​ Change ​ Change ​ 2023 2022 $ % ​ ​ (In Thousands) ​ ​ ​ ​ ​ ​ Revenue ​ $ 572,543 $ 452,418 ​ $ 120,125 ​ 27 % Cost of revenue (exclusive of depreciation and amortization shown separately below) ​ 106,631 ​ 77,866 ​ 28,765 ​ 37 ​ Product development ​ 125,376 ​ 95,118 ​ 30,258 ​ 32 ​ Sales, marketing and customer support ​ 125,953 ​ 107,416 ​ 18,537 ​ 17 ​ General and administrative ​ 87,971 ​ 78,666 ​ 9,305 ​ 12 ​ Depreciation and amortization ​ 40,885 ​ 34,328 ​ 6,557 ​ 19 ​ Income from operations ​ 85,727 ​ 59,024 ​ 26,703 ​ 45 ​ Interest expense ​ 1,066 ​ 905 ​ 161 ​ 18 ​ Other income, net ​ (11,216) ​ (1,249) ​ (9,967) ​ 798 ​ Income before income taxes ​ 95,877 ​ 59,368 ​ 36,509 ​ 61 ​ Income tax expense ​ 24,411 ​ 16,100 ​ 8,311 ​ 52 ​ Net income ​ $ 71,466 ​ $ 43,268 ​ $ 28,198 ​ 65 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 31, ​ 2023 ​ 2022 ​ ​ (as % of Revenue) Revenue 100 % ​ 100 % Cost of revenue (exclusive of depreciation and amortization shown separately below) 19 ​ 17 ​ Product development 22 ​ 21 ​ Sales, marketing and customer support 22 ​ 24 ​ General and administrative 15 ​ 17 ​ Depreciation and amortization 7 ​ 8 ​ Income from operations 15 ​ 13 ​ Interest expense — ​ — ​ Other income, net (2) ​ — ​ Income before income taxes 17 ​ 13 ​ Income tax expense 4 ​ 4 ​ Net income 12 % ​ 10 % ​ Note: Percentages may not sum due to rounding.
Results of Operations Comparison of the Years Ended December 31, 2024 and 2023 The following tables show our results of operations for the years ended December 31, 2024 and 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ ​ ​ ​ ​ ​ December 31, ​ Change ​ Change ​ 2024 2023 $ % ​ ​ (In Thousands) ​ ​ ​ ​ ​ ​ Revenue ​ $ 656,849 $ 572,543 ​ $ 84,306 ​ 15 % Cost of revenue (exclusive of depreciation and amortization shown separately below) ​ 116,515 ​ 106,631 ​ 9,884 ​ 9 ​ Product development ​ 153,046 ​ 125,376 ​ 27,670 ​ 22 ​ Sales, marketing and customer support ​ 167,506 ​ 125,953 ​ 41,553 ​ 33 ​ General and administrative ​ 92,147 ​ 87,971 ​ 4,176 ​ 5 ​ Depreciation and amortization ​ 45,215 ​ 40,885 ​ 4,330 ​ 11 ​ Income from operations ​ 82,420 ​ 85,727 ​ (3,307) ​ (4) ​ Interest expense ​ 1,118 ​ 1,066 ​ 52 ​ 5 ​ Other income, net ​ (7,488) ​ (11,216) ​ (3,728) ​ (33) ​ Income before income taxes ​ 88,790 ​ 95,877 ​ (7,087) ​ (7) ​ Income tax expense ​ 32,559 ​ 24,411 ​ 8,148 ​ 33 ​ Net income ​ $ 56,231 ​ $ 71,466 ​ $ (15,235) ​ (21) % ​ 53 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 31, ​ 2024 ​ 2023 ​ ​ (as % of Revenue) Revenue 100 % ​ 100 % Cost of revenue (exclusive of depreciation and amortization shown separately below) 18 ​ 19 ​ Product development 23 ​ 22 ​ Sales, marketing and customer support 26 ​ 22 ​ General and administrative 14 ​ 15 ​ Depreciation and amortization 7 ​ 7 ​ Income from operations 13 ​ 15 ​ Interest expense — ​ — ​ Other income, net (1) ​ (2) ​ Income before income taxes 14 ​ 17 ​ Income tax expense 5 ​ 4 ​ Net income 9 % ​ 12 % ​ Note: Percentages may not sum due to rounding.
Bad debt expenses increased by $5.0 million, including a reserve established in connection with outstanding amounts owed to us by our activation partner, MediaMath Holdings, Inc., which filed for Chapter 11 bankruptcy protection on June 30, 2023.
The increase was due primarily to an increase in personnel costs, including stock-based compensation, of $9.1 million, and an increase in third party professional fees of $0.9 million, partially offset by a reduction in bad debt expenses of $5.1 million primarily related to a reserve established in the prior year in connection with outstanding amounts owed to the Company by its activation partner, MediaMath Holdings, Inc., which filed for Chapter 11 bankruptcy protection on June 30, 2023, and a decrease in general corporate insurance costs of $1.2 million.
For Supply-side revenue, we offer to our supply-side platform partners arrangements to measure all ads on their platform. These arrangements are typically subscription-based with minimum guarantees, and are recognized on a straight-line basis over the term of the contract, generally spanning from one to two years.
These arrangements are typically subscription-based with minimum guarantees, and are recognized on a straight-line basis over the term of the contract, generally spanning from one to three years. For contracts that contain overages, once the minimum guaranteed amount is achieved, overages are recognized as earned over time based on a tiered pricing structure.
For the year ended December 31, 2022, cash used in investing activities of $40.0 million was attributable to purchases of property, plant and equipment, including leasehold improvements and furniture and fixtures for the Company’s new global headquarters of approximately $32.4 million, and capitalized software development costs.
Investing Activities For the year ended December 31, 2024, cash used in investing activities was $44.8 million, including $17.7 million attributable to net investments in short-term financial instruments and $27.1 million attributable to purchases of property, plant and equipment, and capitalized software development costs.
Adjusted EBITDA In addition to our results determined in accordance with GAAP, management believes that certain non-GAAP financial measures, including Adjusted EBITDA and Adjusted EBITDA Margin, are useful in evaluating our business. We calculate Adjusted EBITDA Margin as Adjusted EBITDA divided by total revenue.
The increase was due primarily to an increase in unfavorable permanent tax adjustments, including non-deductible executive compensation and stock-based compensation. 55 Table of Contents Adjusted EBITDA In addition to our results determined in accordance with GAAP, management believes that certain non-GAAP financial measures, including Adjusted EBITDA and Adjusted EBITDA Margin, are useful in evaluating our business.
Sales and marketing expense also includes costs for promotional marketing activities, advertising costs, and attendance at events and trade shows. Sales commissions are expensed as incurred. General and administrative. General and administrative expenses consist primarily of personnel expenses associated with our executive, finance, legal, human resources and other administrative employees.
General and administrative expenses consist primarily of personnel expenses associated with our executive, finance, legal, human resources and other administrative employees.
We derive revenue primarily from our advertiser customers based on the volume of media transactions, or ads, that our software platform measures (“Media Transactions Measured”). Advertisers utilize the DV Authentic Ad, our definitive metric of digital media quality, to evaluate the existence of fraud, brand safety, viewability and geography for each digital ad.
Advertisers utilize the DV Authentic Ad, our definitive metric of digital media quality, to evaluate the existence of fraud, brand safety, viewability and geography for each digital ad. Advertisers pay us an analysis fee (“Measured Transaction Fee”) per thousand impressions based on the volume of Media Transactions Measured on their behalf. The price of most of our solutions is fixed.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeAs of December 31, 2023, December 31, 2022 and December 31, 2021, we had $0, respectively, in variable rate debt outstanding. The New Revolving Credit Facility entered into on October 1, 2020 matures in October 2025 and bears interest at SOFR plus 2.00% or the Alternate Base Rate plus 1.00% (at the Company’s option) per annum.
Biggest changeThe New Revolving Credit Facility entered into on August 12, 2024 matures in August 2029 and bears interest at either a SOFR plus an applicable margin ranging from 2.00% to 2.75% per annum, or the ABR plus an applicable margin ranging from 1.00% to 1.75% (at the Company’s option) per annum.
Our revenue is denominated in primarily U.S. dollars. Our expenses are generally denominated in the currencies in which our operations are located, which is primarily in the United States. Movements in foreign currency exchange rates versus the U.S. dollar did not have a material effect on our revenue for 2023.
Our revenue is denominated in primarily U.S. dollars. Our expenses are generally denominated in the currencies in which our operations are located, which is primarily in the United States. Movements in foreign currency exchange rates versus the U.S. dollar did not have a material effect on our revenue for 2024.
To date, we have not entered into any material foreign currency hedging contracts, although we may do so in the future. ​ 64 Table of Contents ​
To date, we have not entered into any material foreign currency hedging contracts, although we may do so in the future. ​ 66 Table of Contents ​
A hypothetical 10% change in exchange rates versus the U.S. dollar would not have resulted in a material change to our 2023 earnings.
A hypothetical 10% change in exchange rates versus the U.S. dollar would not have resulted in a material change to our 2024 earnings.
Our cash, cash equivalents and short-term investments as of December 31, 2023, December 31, 2022 and December 31, 2021 consisted of $310.1 million, $267.8 million and $221.6 million, respectively, in bank deposits, treasury bills and money market funds. Such interest-earning instruments carry a degree of interest rate risk.
Our cash, cash equivalents and short-term investments as of December 31, 2024, December 31, 2023 and December 31, 2022 consisted of $310.6 million, $310.1 million and $267.8 million, respectively, in bank deposits, treasury bills, treasury notes and money market funds. Such interest-earning instruments carry a degree of interest rate risk.
As of December 31, 2023, we have no outstanding variable rate indebtedness and have $150 million of availability under the New Revolving Credit Facility. Foreign Currency Exchange Risk As we expand internationally, our results of operations and cash flows may become increasingly subject to fluctuations due to changes in foreign currency exchange rates.
As of December 31, 2024, we have no outstanding variable rate indebtedness and have $200.0 million of availability under the New Revolving Credit Facility. Foreign Currency Exchange Risk As we expand internationally, our results of operations and cash flows may become increasingly subject to fluctuations due to changes in foreign currency exchange rates.
Added
As of December 31, 2024, December 31, 2023 and December 31, 2022, we had $0, respectively, in variable rate debt outstanding.

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