Dual Digital Marketing Solutions Company
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(NYSE: PERI) reported revenue of $ 60.3 million in the second quarter and a loss of 8 cents per share. Analysts had expected revenue of $ 53.6 million on a loss of 9 cents a share. At an annual level, productivity is expected to end 2020 with revenues of $ 276-286 million – well above analysts’ expectations.
The company’s revenues in the second quarter decreased by 5% and amounted to $ 60.3 million, compared to $ 63.6 million in the corresponding period last year. The company exceeded analysts’ expectations for revenues of about $ 53.6 million. The decrease in revenue is mainly due to a 12% decrease in advertising activity, which was adversely affected by the impact on advertising expenditure due to the consequences of the epidemic. This negative impact was partially offset by the January 14 acquisition of ContentIQ. The epidemic also affected search activity, whose revenues fell by 1% due to a drop in sponsored search prices, which was partially offset by an increase in the number of searches.
The net loss (GAAP) in the second quarter amounted to about $ 2.2 million (8 cents per share), compared to a profit of $ 2.9 million in the corresponding quarter. Analysts had expected a loss (GAAP) of 9 cents a share. Adjusted net income (Non-GAAP) decreased by about 11% and amounted to about $ 1.9 million or 7 cents per share.
Adjusted EBITDA in the second quarter fell by 67% compared to the corresponding quarter to $ 2.5 million. Meanwhile, the company expects adjusted EBITDA in the second half of the year to total $ 11-13 million, compared to $ 8.7 million in the first half.
Accordingly, on an annual level, productivity is expected to end 2020 with revenues of $ 276-286 million – analysts expected revenues of approximately $ 262 million by 2020. Adjusted EBITDA is expected to amount to $ 20-22 million.
Summary of financial results
Source: Productivity Network
Productivity Network CEO, Doron Gerstel: “The financial implications of the Corona plague must be examined more broadly. I am pleased with our ability to meet the challenging conditions of the current period. The first half results of 2020 were better than early expectations. Thanks to our diversified operations and spending structure adjustment, we were able to quickly mitigate advertising budgets.” Due to the epidemic, it enabled us to maintain operating profitability and cash flow, while strengthening our unique capabilities in the digital media world. “Despite the global decline in the volume of sponsored searches, we continue to increase the number of sponsored searches provided to Microsoft Bing, and are convinced that the stabilization of exposure prices will lead to an improvement in search division results in the second half of the year.”
Regarding advertising activity, Gerstel said: “Despite the decline in advertising spending in all sectors, especially in the tourism and automotive markets, which adversely affected our advertising activity in the second quarter, we are now seeing the first signs of recovery. We also adjusted spending structure in 2020. Of about $ 10 million a year.This combination allows us to enjoy the recovery in a variety of digital advertising areas.
“The epidemic has not hurt the implementation of our growth strategy through synergistic acquisitions. Integrating CIQ in productivity has been completed with great success. We are very pleased with CIQ’s performance and prepared for the next phase – PubOcean, which synergies with CIQ and is expected to generate revenue and profitability from the second half of the year.”
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