Marchex Announces Record Second Quarter 2014 Results (Archeo Sells $2.2 Million Of Domains)

Marchex, Inc. (NASDAQ:MCHX), a mobile advertising technology company and owner of Archeo Domains, today announced its financial results for the second quarter ended June 30, 2014.

Archeo Q2 Business Highlights:

• Revenue. Archeo non-GAAP revenue was $1.5 million for the second quarter of 2014, which excludes domain sales recognized in GAAP revenue.
• Domains sales. During the second quarter of 2014, domain sales yielded $2.2 million.

Here is the complete press release:

Marchex, Inc. (NASDAQ:MCHX), a mobile advertising technology company, today announced its financial results for the second quarter ended June 30, 2014.

“Our ability to deliver strong returns for our customers through our call advertising products drove another record during the second quarter,” said Russell Horowitz, Chairman and CEO of Marchex. “Our focus on our clients’ success is the cornerstone of our business. Our Call Analytics platform is enabling Marchex to provide unique intelligence and insight around calls at the same time mobile and call-based advertising is emerging as a major theme for advertisers. As a result, we are further integrating with some of our largest advertisers and landing new customers, many of which are embracing mobile performance advertising for the first time.”

Q2 2014 Financial Highlights¹

• GAAP revenue was $49.7 million for the second quarter of 2014, compared to $37.6 million for the second quarter of 2013. Non-GAAP revenue², which excludes domain sales recorded in revenue, was $47.4 million for the second quarter of 2014.
• GAAP net income from continuing operations was $947,000 for the second quarter of 2014, compared to a GAAP net loss from continuing operations of $354,000 for the second quarter of 2013.
• GAAP net income from continuing operations attributable to common stockholders per diluted share was $0.02 for the second quarter of 2014. This compares to GAAP net loss from continuing operations attributable to common stockholders per diluted share of $0.01 for the second quarter of 2013.

• Adjusted non-GAAP EPS³ from continuing operations for the second quarter of 2014 was $0.07, compared to $0.06 for the second quarter of 2013. Adjusted non-GAAP EPS³ from continuing operations excluding domain gains and sales for the second quarter of 2014 and 2013 were both $0.04.

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 Includes/excludes domain sales recognized in GAAP revenue and domain sales recognized in gains on sales and disposals of intangible assets.

⁴ 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.

⁵ 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 Q2 and Recent Call-Driven Business Highlights:

• Revenue. Call-Driven and related revenue was $45.9 million for the second quarter of 2014 – a 35 percent increase compared to $33.9 million for the second quarter of 2013.
• Strategic Developments. Marchex raised $32.5 million as part of its secondary 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 Q2 Business Highlights:

• Revenue. Archeo non-GAAP revenue was $1.5 million for the second quarter of 2014, which excludes domain sales recognized in GAAP revenue.
• Domains sales. During the second quarter of 2014, domain sales yielded $2.2 million.

Business Outlook

The following forward-looking statements reflect Marchex’s expectations as of August 5, 2014 and exclude any contribution from Archeo operations, domain sales and discontinued operations. Archeo operating results would be incremental and additive to our Call-Driven revenue, profitability, and other measures below:

¹ These non-GAAP Call-Driven measures assign all Marchex corporate overhead costs to the Call-Driven results. 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.