Marchex and Archeo 2014 Q1 Report: $1.9 million worth of domains sold

Marchex, Inc. (NASDAQ:MCHX), that owns Archeo Domains, announced its financial results for the first quarter ended March 31, 2014. Marchex sold $1.9 million worth of domains through Archeo.

“As the first quarter demonstrates, advertisers are increasingly turning to Marchex as they begin to boost spending in mobile performance advertising,” said Russell Horowitz, Chairman and CEO of Marchex. “With the rapid adoption of mobile, consumer phone calls are fast-becoming one of the most important outcomes of mobile ad campaigns. Advertisers now want a better understanding of these over-the-phone interactions. Marchex is ideally positioned to meet this new and growing market, based on our early investment in our Call Analytics technology platform and pay-for-call marketplace.”

Q1 2014 Financial Highlights¹

• GAAP revenue was $50.5 million for the first quarter of 2014, compared to $34.7 million for the first quarter of 2013. Non-GAAP revenue², which excludes domain sales recorded in revenue, was $48.6 million for the first quarter of 2014.
• GAAP net income from continuing operations was $846,000 for the first quarter of 2014, compared to a GAAP net income from continuing operations of $116,000 for the first quarter of 2013.
• GAAP net income from continuing operations attributable to common stockholders per diluted share was $0.02 for the first quarter of 2014. This compares to GAAP net income from continuing operations attributable to common stockholders per diluted share of $0.00 for the first quarter of 2013.

				Q1 2014				Q1 2013
GAAP Revenue				$50.5 million				$34.7 million
Non-GAAP Results:
Non-GAAP Revenue 2, 4				$48.6 million				$34.7 million
Call-Driven and Related Revenue				$45.5 million				$31.1 million
Archeo Revenue excluding domain gains and sales 2, 4				$3.1 million				$3.6 million
Call-Driven Adjusted OIBA4				$2.4 million				$1.4 million
Call-Driven Adjusted EBITDA4				$3.3 million				$2.2 million
Adjusted OIBA3, 4				$4.7 million				$3.6 million
Adjusted EBITDA3, 4				$5.7 million				$4.5 million
Adjusted OIBA excluding domain gains and sales4				$2.8 million				$2.2 million
Adjusted EBITDA excluding domain gains and sales4				$3.8 million				$3.2 million

• Adjusted non-GAAP EPS³ from continuing operations for the first quarter of 2014 was $0.08, compared to $0.07 for the first quarter of 2013. Adjusted non-GAAP EPS³ from continuing operations excluding domain gains and sales for the first quarter of 2014 was $0.05, compared to $0.04 for the first quarter of 2013.

¹ In July 2013, certain pay-per-click assets were sold. As a result, the financial results of these pay-per-click assets are presented as discontinued operations, net of tax in our condensed consolidated statements of operations in accordance with GAAP, and are excluded from all other results unless otherwise noted.

² Excludes domain sales recognized in GAAP revenue. In September 2013 upon the launch of its domain marketplace, the company commenced recognizing domain sales as revenue.

³ Adjusted OIBA, Adjusted EBITDA and Non-GAAP EPS include the impact of domain gains and sales. Historically, these non-GAAP measures excluded the impact of domain gains and sales.

⁴ Reconciliations of non-GAAP measures are included in the financial tables attached to this press release and we encourage investors to examine the reconciling adjustments between the GAAP and non-GAAP measures.

Marchex Q1 and Recent Call-Driven Business Highlights:

• Revenue. Call-Driven and related revenue was $45.5 million for the first quarter of 2014 – a 46 percent increase compared to $31.1 million for the first quarter of 2013.
• Customers and Partners. Added more than a dozen new national and reseller customers across several categories, such as Auto Services, Financial Services, and Travel.
• Strategic Developments. Marchex raised $32 million as part of its public offering which was completed on April4th. Marchex intends to use the net proceeds of the offering for general corporate purposes, which may include acquisitions or licenses of, or investments in, products, services, technologies or other businesses.

Archeo Q1 Business Highlights:

• Revenue. Archeo non-GAAP revenue was $3.1 million for the first quarter of 2014, which excludes domain sales recognized in GAAP revenue.
• Domains sales. During the first quarter of 2014, domain sales yielded $1.9 million.