[November 07, 2012] |
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Rosetta Stone Inc. Reports Third Quarter 2012 Results
ARLINGTON, Va. --(Business Wire)--
Rosetta Stone Inc. (NYSE:RST), a leading provider of technology-based
language-learning solutions, today announced financial results for the
third quarter 2012, as summarized below:
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US$ thousands
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Three Months Ended
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except per-share data
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September 30,
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%
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2012
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2011
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change
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Total revenue
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$64,279
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$64,202
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0%
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Bookings1
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$72,125
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$66,062
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9%
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Net loss
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(33,390)
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(1,177)
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-2,737%
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Net loss per share
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$(1.58)
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$(0.06)
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-2,533%
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Adjusted Net loss1,2
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(1,748)
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(1,177)
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-49%
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Adjusted Net loss per share1,2
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$(0.08)
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$(0.06)
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-33%
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Adjusted EBITDA1
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$1,827
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$(1,791)
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202%
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Cash flow from operations
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5,424
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(2,010)
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370%
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Purchases of property and equipment
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(941)
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(2,443)
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-61%
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Free cash flow1
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4,483
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(4,453)
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201%
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1Definitions and reconciliations for all non-GAAP measures
are provided in this press release. 2 Excludes impact of
legal expenses related to the lawsuit against Google, Inc. and all
adjustments related to recording a non-cash tax valuation allowance for
deferred tax assets.
Steve Swad, President and Chief Executive Officer of Rosetta Stone,
said, "We had a good third quarter with bookings up 9% year-over-year
with double-digit growth in our consumer business and single-digit
growth in our institutional business. We also did a better job managing
our expenses and we made progress shifting the business online with over
57,000 consumer Online Learners and over 80% of our institutional
business online." Swad added, "We grew consumer Online Learners by 115%
since the beginning of the year and by 167% versus this time last year.
We operated more efficiently and lowered expenses, including reducing
our kiosk expenses and lowering our international media spend which
allowed us to deliver Adjusted EBITDA of $1.8 million, more than double
the $1.8 million loss a year ago."
Third Quarter 2012 Operational and Financial Highlights
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Bookings grew 9%: Total bookings increased 9% year-over-year to
$72.1 million from $66.1 million. The increase reflected an 11%
increase in Consumer bookings as well as 4% growth in Institutional
bookings related to signing new and renewal deals that will be
recognized over time. Growth in Consumer bookings was due entirely to
an 18% increase in the US, offset by a 10% decrease in International
compared with last year.
-
Revenue up slightly: Consolidated revenue of $64.3 million
increased slightly from $64.2 million a year ago. US Consumer revenue
increased 5% reflecting double-digit growth in the company's
direct-to-consumer (DTC) channel, offset by lower contribution from
the kiosk channel as the company operated 60 fewer kiosks on average.
International Consumer revenue declined 8% primarily due to a decrease
in revenues from Japan, in part the result of operating fewer kiosks,
and lower sales in Germany, reflecting the shift to an online-only
model, partially offset by an increase in Korea from increased sales
in the home shopping TV channel. The Institutional business decreased
6% mainly due to the non-renewal of the Army and Marines contracts
last year, partially offset by increases in Corporate and
International.
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US$ thousands
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Three Months Ended
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September 30,
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September 30,
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%
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2012
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2011
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change
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Revenue from:
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US Consumer
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$39,681
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$37,710
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5%
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International Consumer
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10,094
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11,002
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-8%
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Total Consumer
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49,775
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48,712
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2%
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Institutional
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14,504
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15,490
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-6%
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Total
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64,279
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64,202
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0%
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-
Adjusted EBITDA: Adjusted EBITDA for the third quarter was $1.8
million, an increase of $3.6 million from ($1.8) million in the third
quarter of 2011. The improvement in Adjusted EBITDA was mainly due to
the small increase in revenues combined with a 7% or $2.7 million
reduction in sales and marketing, partially offset by a $0.4 million
increase in general and administrative (G&A) expenses and an increase
in research and development costs.
-
Valuation Allowance for Deferred Tax Assets: The Company
recorded a non-cash charge of $25.6 million in the third quarter of
2012 to establish a valuation allowance against its deferred tax
assets ("DTAs") primarily in the United States. In accordance with US
GAAP, Rosetta Stone evaluates its DTAs quarterly to determine if
valuation allowances are required. This determination was based on
several factors, including whether the company had a three-year
historical cumulative pre-tax loss, which the Company crossed in the
third quarter, and as a result, the Company recorded a non-cash charge
to income tax expense. Establishment of this valuation allowance does
not preclude the company from utilizing the DTAs in the future to
reduce cash tax payments.
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Net Income: Rosetta Stone recorded a net loss of $33.4 million
in the third quarter 2012, compared to a net loss of $1.2 million in
the third quarter of 2011. Net loss per share was $1.58 compared to a
net loss of $0.06 per share in the prior year period. Net loss for the
quarter included the impact of the valuation allowance established
against its deferred tax assets. Excluding the impact of this
valuation allowance and Google-related legal costs of $1.0 million,
Adjusted net loss was $1.7 million compared to a loss of $1.2 million
a year ago while Adjusted net loss per share was $0.08 compared with
$0.06 net loss per share a year ago.
-
Balance Sheet and Cash Flow: Cash, cash equivalents and
short-term investments were $126.1 million at September 30, 2012, an
increase of $9.8 million compared with $116.3 million at December 31,
2011 and an increase of $14.8 million from the prior year period. The
company has no debt. Net cash provided by operating activities in the
quarter was $5.4 million compared with ($2.0) million a year ago.
Capital expenditures were $0.9 million. Free cash flow for the quarter
was $4.5 million, compared with ($4.5) million in the third quarter of
2011.
Financial Outlook
The company is providing the following update to its guidance for the
full year 2012:
-
Increasing the range of Adjusted EBITDA* by $2 million to $8 million
to $10 million from $6 million to $8 million.
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Maintaining the range of Adjusted net loss** at $6 million to $4
million, but improving Adjusted net loss per share** to a range of
$0.20 to $0.30. These figures exclude the Google legal expenses and
all adjustments related to recording the valuation allowance so that
they are comparable to our previous guidance of a net loss of $4
million to $6 million and net loss per share of $0.20 to $0.33.
-
Lowering the range for capital expenditures to $5 million to $8
million compared with previous guidance of $8 million to $11 million.
*Adjusted EBITDA excludes legal expenses related to the lawsuit
against Google Inc. and any restructuring costs.
**Adjusted net loss and Adjusted net loss per share exclude the
impact of legal expenses related to the lawsuit against Google, Inc. and
all adjustments related to recording the non-cash tax valuation
allowance for deferred tax assets.
Non-GAAP Financial Measures
This press release contains several non-GAAP financial measures.
Adjusted EBITDA is GAAP net income or loss plus interest income and
expense, income tax benefit and expense, depreciation, amortization and
stock-based compensation expenses. Adjusted EBITDA excludes any expenses
related to the lawsuit against Google Inc., and any restructuring costs.
Adjusted EBITDA for prior periods has been revised to conform to current
definition. Adjusted net loss and adjusted net loss per share exclude
the impact of legal expenses related to its lawsuit against Google, Inc.
and all adjustments related to recording the non-cash tax valuation
allowance for deferred tax assets. Free cash flow is cash flow from
operations less cash used in purchases of property and equipment.
Bookings represent executed sales contracts received by the Company that
are either recorded immediately as revenue or as deferred revenue.
Management believes that these non-GAAP measures of financial results
provide useful information to investors regarding certain financial and
business trends relating to the Company's financial condition and
results of operations. Management uses these non-GAAP measures to
compare the Company's performance to that of prior periods for trend
analyses, for purposes of determining executive incentive compensation,
and for budgeting and planning purposes. These measures are used in
monthly financial reports prepared for management and in quarterly
financial reports presented to the Company's board of directors.
Management believes that the use of these non-GAAP financial measures
provides an additional tool for investors to use in evaluating ongoing
operating results and trends and in comparing the Company's financial
measures with other software companies, many of which present similar
non-GAAP financial measures to investors.
Management typically excludes the amounts described above when
evaluating the Company's operating performance and believes that the
resulting non-GAAP measures are useful to investors and financial
analysts in assessing the Company's operating performance due to the
following factors:
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Amortization of Acquired Intangibles. Amortization costs and
the related tax effects are fixed at the time of an acquisition, and
then amortized over a period of several years after the acquisition
and generally cannot be changed or influenced by management after the
acquisition.
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Stock-based Compensation. Although stock-based compensation is
an important aspect of compensation of the Company's employees and
executives, stock-based compensation expense is generally fixed at the
time of grant, then amortized over a period of several years after the
grant of the stock-based instrument, and generally cannot be changed
or influenced by management after the grant. In addition, the impact
of shares granted under these plans is considered in the Company's EPS
calculation to the extent the shares are dilutive.
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Bookings. Although revenue is an important aspect of measuring
Company performance, the Company believes total sales bookings can be
a valuable indicator of the Company's performance. The Company is
transitioning to a greater amount of subscription sales, which results
in an increasing portion of sales being recorded as deferred revenue.
Management does not consider these non-GAAP measures in isolation or as
an alternative to financial measures determined in accordance with GAAP.
The principal limitation of these non-GAAP financial measures is that
they exclude significant expenses and income that are required by GAAP
to be recorded in the Company's financial statements. In addition, they
are subject to inherent limitations, because they reflect the exercise
of judgments by management about which expenses and items of income are
excluded from these non-GAAP financial measures and may not be
calculated in the same manner as other companies' similarly titled
non-GAAP measures.
In order to compensate for these limitations, management presents its
non-GAAP financial measures in connection with its GAAP results. The
company urges investors to review the reconciliation of its non-GAAP
financial measures to the comparable GAAP financial measures, which it
includes in press releases announcing earnings information, including
this press release, and not to rely on any single financial measure to
evaluate the company's business.
Reconciliation tables of the most comparable GAAP financial measures to
the non-GAAP measures used in this press release are included at the end
of this release.
Investor Webcast
This news release and the accompanying tables should be read in
conjunction with the additional content that is available on the
company's website.
In conjunction with this announcement, Rosetta Stone will host a webcast
today at 4:30 p.m. eastern time (ET) to discuss the results and the
company's business outlook. The webcast will be available live on the
Investor Relations page of the company's website at http://investors.rosettastone.com.
Investors may also dial in to the conference line using one of the
following numbers:
1-877-407-4018 (toll-free) or
1-201-689-8471 (toll/international)
A recorded replay of the webcast will be available on the "Investor
Relations" page of the company's web site http://investors.rosettastone.com
after the live discussion. The replay will also be available beginning
at 7:30PM ET until November 21, 2012 via telephone at the following
numbers:
1-877-870-5176 (toll-free) or
1-858-384-5517 (toll/international)
Pass Code: 403092
About Rosetta Stone
Rosetta Stone Inc. provides cutting-edge interactive technology that is
changing the way the world learns languages. The company's proprietary
learning techniques-acclaimed for their power to unlock the natural
language-learning ability in everyone-are used by schools, businesses,
government organizations and millions of individuals around the world.
Rosetta Stone offers courses in 30 languages, from the most commonly
spoken (like English, Spanish and Mandarin) to the less prominent
(including Swahili, Swedish and Tagalog). The company was founded in
1992 on the core beliefs that learning to speak a language should be a
natural and instinctive process, and that interactive technology can
activate the language immersion method powerfully for learners of any
age. Rosetta Stone is based in Arlington, VA., and has offices in
Harrisonburg, VA, Boulder, CO, Tokyo, Seoul, London, and Sao Paulo.
"Rosetta Stone" is a registered trademark or trademark of Rosetta Stone
Ltd. in the United States and other countries.
Cautionary Statement Regarding Forward-Looking Statements
Certain statements in this press release are forward-looking statements,
including our guidance for future financial performance and operating
targets, and our long-term growth prospects. In this context,
forward-looking statements often address our expected future business
and financial performance, and often contain words such as "project,"
"believe," "plan," "expect," "anticipate," "estimate," "intend,"
"should," "would," "could," "potentially," "seek," "may," "likely,"
"will," "financial outlook," "strategy," or "continue." These
forward-looking statements reflect the company's current views with
respect to future events and are subject to certain risks,
uncertainties, and assumptions. A number of important factors could
cause actual results or events to differ materially from those indicated
by such forward-looking statements, including demand for language
learning software; the advantages of our products, services, technology,
brand and business model as compared to others; our strategic focus; our
ability to maintain effective internal controls or to remediate material
weaknesses; our cash needs and expectations regarding cash flow from
operations; our product development plans; the appeal and efficacy of
our products; our expectations regarding capturing lifetime value and a
broader range of market segments through such offerings; our plans
regarding expansion of our marketing initiatives and sales force; our
international expansion and growth plans; our plans regarding our kiosks
and retail relationships; our plans regarding our Institutional
business; the impact of any revisions to our pricing strategy; our
ability to manage and grow our business and execute our business
strategy; our financial performance; our actions to stabilize our
business in the U.S. consumer market including realigning our cost
structure and revitalizing our go-to-market strategy; our plans to
transition our distribution to more online in the consumer space;
adverse trends in general economic conditions and the other factors
described more fully in the company's filings with the U.S. Securities
and Exchange Commission (SEC), including the company's annual report on
Form 10-K for the fiscal year ended December 31, 2011, which is on file
with the SEC. The company assumes no obligation to update the
information in this communication, except as otherwise required by law.
Readers are cautioned not to place undue reliance on these
forward-looking statements that speak only as of the date hereof.
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ROSETTA STONE INC.
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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
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(in thousands, except per share amounts)
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(unaudited)
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Three Months Ended
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Nine Months Ended
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September 30,
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September 30,
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2012
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2011
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2012
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2011
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Revenue:
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Product
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$
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42,462
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$
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44,183
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$
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127,534
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$
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134,541
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Subscription and service
|
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21,817
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20,019
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67,006
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53,381
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Total revenue
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64,279
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64,202
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194,540
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187,922
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Cost of revenue:
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Cost of product revenue
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7,858
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7,862
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24,087
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25,430
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Cost of subscription and service revenue
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3,327
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3,447
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11,892
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|
8,861
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Total cost of revenue
|
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11,185
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|
11,309
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35,979
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34,291
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Gross profit
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53,094
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52,893
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158,561
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153,631
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Operating expenses
|
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Sales and marketing
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37,113
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39,821
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|
110,641
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|
|
118,175
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Research and development
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|
5,177
|
|
|
4,991
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|
17,944
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|
|
17,829
|
General and administrative
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14,474
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|
14,115
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41,050
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42,731
|
Total operating expenses
|
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56,764
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|
|
58,927
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|
169,635
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178,735
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Loss from operations
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(3,670)
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(6,034)
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(11,074)
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(25,104)
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|
|
|
|
|
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|
Other income and (expense):
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Interest income
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|
42
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|
|
62
|
|
|
141
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|
|
224
|
Interest expense
|
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|
-
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(1)
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|
-
|
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(5)
|
Other income (expense)
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(27)
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|
34
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|
|
(71)
|
|
|
83
|
Total other income (expense)
|
|
|
15
|
|
|
95
|
|
|
70
|
|
|
302
|
|
|
|
|
|
|
|
|
|
Loss before income taxes
|
|
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(3,655)
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(5,939)
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|
|
(11,004)
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|
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(24,802)
|
Income tax expense (benefit)
|
|
|
29,735
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|
(4,762)
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|
|
28,833
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|
|
(9,794)
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|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(33,390)
|
|
$
|
(1,177)
|
|
$
|
(39,837)
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|
$
|
(15,008)
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|
|
|
|
|
|
|
|
|
Net loss per share:
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|
|
|
|
|
|
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|
Basic
|
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$
|
(1.58)
|
|
$
|
(0.06)
|
|
$
|
(1.90)
|
|
$
|
(0.72)
|
Diluted
|
|
$
|
(1.58)
|
|
$
|
(0.06)
|
|
$
|
(1.90)
|
|
$
|
(0.72)
|
|
|
|
|
|
|
|
|
|
Common shares and equivalents outstanding:
|
|
|
|
|
|
|
|
|
Basic weighted average shares
|
|
|
21,073
|
|
|
20,780
|
|
|
21,004
|
|
|
20,724
|
Diluted weighted average shares
|
|
|
21,073
|
|
|
20,780
|
|
|
21,004
|
|
|
20,724
|
|
|
|
|
|
ROSETTA STONE INC.
|
CONDENSED CONSOLIDATED BALANCE SHEETS
|
(in thousands, except per share amounts)
|
(unaudited)
|
|
|
September 30
|
|
December 31,
|
|
|
2012
|
|
2011
|
|
|
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
Current assets:
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
126,046
|
|
|
$
|
106,516
|
Restricted cash
|
|
|
58
|
|
|
|
74
|
Short term investments
|
|
|
-
|
|
|
|
9,711
|
Accounts receivable (net of allowance for doubtful accounts of
$1,299 and $1,951, respectively)
|
|
|
39,685
|
|
|
|
51,997
|
Inventory
|
|
|
6,765
|
|
|
|
6,723
|
Prepaid expenses and other current assets
|
|
|
6,306
|
|
|
|
7,081
|
Income tax receivable
|
|
|
9,750
|
|
|
|
7,678
|
Deferred income taxes
|
|
|
13
|
|
|
|
10,985
|
Total current assets
|
|
|
188,623
|
|
|
|
200,765
|
|
|
|
|
|
Property and equipment, net
|
|
|
16,983
|
|
|
|
20,869
|
Goodwill
|
|
|
34,867
|
|
|
|
34,841
|
Intangible assets, net
|
|
|
10,835
|
|
|
|
10,865
|
Deferred income taxes
|
|
|
123
|
|
|
|
8,038
|
Other assets
|
|
|
1,884
|
|
|
|
1,803
|
Total assets
|
|
$
|
253,315
|
|
|
$
|
277,181
|
|
|
|
|
|
Liabilities and stockholders' equity
|
|
|
|
|
Current liabilities:
|
|
|
|
|
Accounts payable
|
|
$
|
6,959
|
|
|
$
|
7,291
|
Accrued compensation
|
|
|
13,211
|
|
|
|
11,703
|
Other current liabilities
|
|
|
28,407
|
|
|
|
34,911
|
Deferred revenue
|
|
|
53,787
|
|
|
|
49,375
|
Total current liabilities
|
|
|
102,364
|
|
|
|
103,280
|
|
|
|
|
|
Deferred revenue
|
|
|
4,002
|
|
|
|
2,520
|
Deferred income taxes
|
|
|
8,102
|
|
|
|
-
|
Other long-term liabilities
|
|
|
213
|
|
|
|
176
|
Total liabilities
|
|
|
114,681
|
|
|
|
105,976
|
|
|
|
|
|
Commitments and contingencies
|
|
|
|
|
|
|
|
|
|
Stockholders' equity:
|
|
|
|
|
Preferred stock, $0.001 par value; 10,000 and 10,000 authorized;
zero and zero shares issued and outstanding September 30, 2012 and
December 31, 2011, respectively
|
|
|
-
|
|
|
|
-
|
Non-designated common stock, $0.00005 par value, 190,000 and
190,000 shares authorized, 21,839 and 21,258 shares issued and
outstanding at September 30, 2012 and December 31, 2011,
respectively
|
|
|
2
|
|
|
|
2
|
Additional paid-in capital
|
|
|
158,861
|
|
|
|
151,823
|
Accumulated income (loss)
|
|
|
(20,755
|
)
|
|
|
19,082
|
Accumulated other comprehensive income
|
|
|
526
|
|
|
|
298
|
Total stockholders' equity
|
|
|
138,634
|
|
|
|
171,205
|
Total liabilities and stockholders' equity
|
|
$
|
253,315
|
|
|
$
|
277,181
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ROSETTA STONE INC.
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(in thousands)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
September 30,
|
|
September 30,
|
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|
|
|
|
|
|
|
|
|
Cash Flows From Operating Activities:
|
|
|
|
|
|
|
|
|
Net loss
|
|
|
(33,390
|
)
|
|
|
(1,177
|
)
|
|
|
(39,837
|
)
|
|
|
(15,008
|
)
|
Adjustments to reconcile net loss to cash provided by (used in)
operating activities
|
|
|
|
|
|
|
|
|
Stock-based compensation expense
|
|
|
2,477
|
|
|
|
1,836
|
|
|
|
6,208
|
|
|
|
4,977
|
|
Bad debt expense
|
|
|
739
|
|
|
|
401
|
|
|
|
1,335
|
|
|
|
709
|
|
Depreciation and amortization
|
|
|
1,748
|
|
|
|
2,184
|
|
|
|
6,230
|
|
|
|
6,439
|
|
Deferred income tax benefit
|
|
|
28,096
|
|
|
|
(2,493
|
)
|
|
|
26,940
|
|
|
|
471
|
|
Loss on sales of equipment
|
|
|
372
|
|
|
|
2
|
|
|
|
752
|
|
|
|
18
|
|
Net change in:
|
|
|
|
|
|
|
|
|
Restricted cash
|
|
|
(13
|
)
|
|
|
(4
|
)
|
|
|
15
|
|
|
|
19
|
|
Accounts receivable
|
|
|
(5,165
|
)
|
|
|
4,358
|
|
|
|
11,149
|
|
|
|
12,345
|
|
Inventory
|
|
|
(479
|
)
|
|
|
1,121
|
|
|
|
1
|
|
|
|
1,361
|
|
Prepaid expenses and other current assets
|
|
|
136
|
|
|
|
820
|
|
|
|
785
|
|
|
|
1,371
|
|
Income tax receivable
|
|
|
660
|
|
|
|
(3,991
|
)
|
|
|
(2,080
|
)
|
|
|
(12,232
|
)
|
Other assets
|
|
|
987
|
|
|
|
1,108
|
|
|
|
(78
|
)
|
|
|
(208
|
)
|
Accounts payable
|
|
|
2,491
|
|
|
|
(2,019
|
)
|
|
|
(377
|
)
|
|
|
738
|
|
Accrued compensation
|
|
|
(298
|
)
|
|
|
(1,859
|
)
|
|
|
1,476
|
|
|
|
(1,462
|
)
|
Other current liabilities
|
|
|
1,123
|
|
|
|
(4,069
|
)
|
|
|
(6,690
|
)
|
|
|
(3,712
|
)
|
Excess tax benefit from stock options exercised
|
|
|
18
|
|
|
|
(334
|
)
|
|
|
-
|
|
|
|
(365
|
)
|
Other long-term liabilities
|
|
|
(1,640
|
)
|
|
|
164
|
|
|
|
(44
|
)
|
|
|
152
|
|
Deferred revenue
|
|
|
7,562
|
|
|
|
1,942
|
|
|
|
5,707
|
|
|
|
370
|
|
Net cash provided by (used in) operating activities
|
|
|
5,424
|
|
|
|
(2,010
|
)
|
|
|
11,492
|
|
|
|
(4,017
|
)
|
|
|
|
|
|
|
|
|
|
Cash Flows From Investing Activities:
|
|
|
|
|
|
|
|
|
Purchases of property and equipment
|
|
|
(941
|
)
|
|
|
(2,443
|
)
|
|
|
(2,939
|
)
|
|
|
(7,908
|
)
|
Proceeds from (purchases of) available-for-sale securities
|
|
|
1,599
|
|
|
|
105
|
|
|
|
9,711
|
|
|
|
(1,801
|
)
|
Acquisition, net of cash acquired
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(75
|
)
|
Net cash provided by (used in) investing activities
|
|
|
658
|
|
|
|
(2,338
|
)
|
|
|
6,772
|
|
|
|
(9,784
|
)
|
|
|
|
|
|
|
|
|
|
Cash Flows From Financing Activities:
|
|
|
|
|
|
|
|
|
Proceeds from the exercise of stock options
|
|
|
830
|
|
|
|
559
|
|
|
|
830
|
|
|
|
639
|
|
Tax benefit of stock options exercised
|
|
|
(18
|
)
|
|
|
334
|
|
|
|
-
|
|
|
|
365
|
|
Payments under capital lease obligations
|
|
|
(2
|
)
|
|
|
(1
|
)
|
|
|
(5
|
)
|
|
|
(6
|
)
|
Net cash provided by financing activities
|
|
|
810
|
|
|
|
892
|
|
|
|
825
|
|
|
|
998
|
|
|
|
|
|
|
|
|
|
|
Increase (decrease) in cash and cash equivalents
|
|
|
6,892
|
|
|
|
(3,456
|
)
|
|
|
19,089
|
|
|
|
(12,803
|
)
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate changes in cash and cash equivalents
|
|
|
380
|
|
|
|
(291
|
)
|
|
|
441
|
|
|
|
114
|
|
|
|
|
|
|
|
|
|
|
Net increase (decrease) in cash and cash equivalents
|
|
|
7,272
|
|
|
|
(3,747
|
)
|
|
|
19,530
|
|
|
|
(12,689
|
)
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents-beginning of period
|
|
|
118,774
|
|
|
|
106,814
|
|
|
|
106,516
|
|
|
|
115,756
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents-end of period
|
|
$
|
126,046
|
|
|
$
|
103,067
|
|
|
$
|
126,046
|
|
|
$
|
103,067
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ROSETTA STONE INC.
|
Reconciliation of Net Loss to Adjusted EBITDA
|
(in thousands)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
September 30,
|
|
September 30,
|
|
|
|
2012
|
|
|
|
2011
|
|
|
|
2012
|
|
|
|
2011
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(33,390
|
)
|
|
$
|
(1,177
|
)
|
|
$
|
(39,837
|
)
|
|
$
|
(15,008
|
)
|
Interest (income)/expense, net
|
|
|
(42
|
)
|
|
|
(61
|
)
|
|
|
(141
|
)
|
|
|
(219
|
)
|
Income tax expense (benefit)
|
|
|
29,735
|
|
|
|
(4,762
|
)
|
|
|
28,833
|
|
|
|
(9,794
|
)
|
Depreciation and amortization
|
|
|
1,748
|
|
|
|
2,184
|
|
|
|
6,230
|
|
|
|
6,439
|
|
Stock-based compensation
|
|
|
2,477
|
|
|
|
1,836
|
|
|
|
6,208
|
|
|
|
4,977
|
|
Other EBITDA Adjustments
|
|
|
1,299
|
|
|
|
189
|
|
|
|
3,392
|
|
|
|
443
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA*
|
|
$
|
1,827
|
|
|
$
|
(1,791
|
)
|
|
$
|
4,685
|
|
|
$
|
(13,162
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*Adjusted EBITDA equals GAAP net income or loss plus interest income and
expense, income tax benefit and expense, depreciation, amortization,
stock-based compensation expenses, restructuring costs and any expenses
related to the previously disclosed lawsuit against Google, Inc. Prior
period Adjusted EBITDA has been conformed to current definition.
|
|
|
|
|
|
|
|
|
ROSETTA STONE INC.
|
Reconciliation of Net Loss to Adjusted Net Loss
|
(in thousands except per share amounts)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
September 30,
|
|
September 30,
|
|
|
2012
|
|
2012
|
|
|
|
|
Adjusted
|
|
|
|
Adjusted
|
|
|
Net loss
|
|
Loss per share
|
|
Net Loss
|
|
Loss per share
|
Net loss as reported
|
|
$
|
(33,390
|
)
|
|
$
|
(1.58
|
)
|
|
$
|
(39,837
|
)
|
|
$
|
(1.90
|
)
|
Expenses related to Google lawsuit
|
|
|
966
|
|
|
$
|
0.05
|
|
|
|
1,096
|
|
|
$
|
0.05
|
|
Income taxes - valuation allowance
|
|
|
30,676
|
|
|
$
|
1.46
|
|
|
|
32,301
|
|
|
$
|
1.54
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net Loss*
|
|
$
|
(1,748
|
)
|
|
$
|
(0.08
|
)
|
|
$
|
(6,440
|
)
|
|
$
|
(0.31
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*Adjusted Net Loss equals GAAP net loss adjusted for expenses related to
the lawsuit against Google, Inc. and all impacts related to recording
the valuation allowance.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rosetta Stone Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Business Metrics
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter-Ended
|
|
|
|
|
|
Quarter-Ended
|
|
|
|
|
|
Quarter-Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3/31/10
|
|
6/30/10
|
|
9/30/10
|
|
12/31/10
|
|
2010
|
|
|
|
3/31/11
|
|
6/30/11
|
|
9/30/11
|
|
12/31/11
|
|
2011
|
|
|
|
3/31/12
|
|
6/30/12
|
|
9/30/12
|
|
12/31/12
|
|
2012
|
Net Bookings by Market
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US Consumer
|
|
41,631
|
|
38,746
|
|
41,138
|
|
52,243
|
|
173,758
|
|
|
|
29,814
|
|
36,828
|
|
35,562
|
|
54,786
|
|
156,990
|
|
|
|
41,237
|
|
37,240
|
|
42,042
|
|
|
|
|
International Consumer
|
|
10,029
|
|
8,177
|
|
9,860
|
|
15,176
|
|
43,242
|
|
|
|
14,996
|
|
12,910
|
|
11,945
|
|
14,589
|
|
54,440
|
|
|
|
13,046
|
|
8,168
|
|
10,729
|
|
|
|
|
Worldwide Consumer
|
|
51,660
|
|
46,923
|
|
50,998
|
|
67,419
|
|
217,000
|
|
|
|
44,810
|
|
49,738
|
|
47,507
|
|
69,375
|
|
211,430
|
|
|
|
54,283
|
|
45,408
|
|
52,771
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Worldwide Institutional
|
|
9,108
|
|
17,110
|
|
22,307
|
|
14,395
|
|
62,920
|
|
|
|
10,770
|
|
16,973
|
|
18,555
|
|
15,459
|
|
61,757
|
|
|
|
10,984
|
|
17,635
|
|
19,354
|
|
|
|
|
Total
|
|
60,768
|
|
64,033
|
|
73,305
|
|
81,814
|
|
279,920
|
|
|
|
55,580
|
|
66,711
|
|
66,062
|
|
84,834
|
|
273,187
|
|
|
|
65,267
|
|
63,043
|
|
72,125
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
YoY Growth (%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US Consumer
|
|
6%
|
|
-9%
|
|
-19%
|
|
-11%
|
|
-9%
|
|
|
|
-28%
|
|
-5%
|
|
-14%
|
|
5%
|
|
-10%
|
|
|
|
38%
|
|
1%
|
|
18%
|
|
|
|
|
International Consumer
|
|
304%
|
|
168%
|
|
135%
|
|
93%
|
|
146%
|
|
|
|
50%
|
|
58%
|
|
21%
|
|
-4%
|
|
26%
|
|
|
|
-13%
|
|
-37%
|
|
-10%
|
|
|
|
|
Worldwide Consumer
|
|
23%
|
|
3%
|
|
-7%
|
|
1%
|
|
4%
|
|
|
|
-13%
|
|
6%
|
|
-7%
|
|
3%
|
|
-3%
|
|
|
|
21%
|
|
-9%
|
|
11%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Worldwide Institutional
|
|
8%
|
|
28%
|
|
5%
|
|
37%
|
|
18%
|
|
|
|
18%
|
|
-1%
|
|
-17%
|
|
7%
|
|
-2%
|
|
|
|
2%
|
|
4%
|
|
4%
|
|
|
|
|
Total
|
|
21%
|
|
9%
|
|
-4%
|
|
6%
|
|
7%
|
|
|
|
-9%
|
|
4%
|
|
-10%
|
|
4%
|
|
-2%
|
|
|
|
17%
|
|
-5%
|
|
9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% of Total Net Bookings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US Consumer
|
|
69%
|
|
60%
|
|
56%
|
|
64%
|
|
62%
|
|
|
|
54%
|
|
55%
|
|
54%
|
|
65%
|
|
57%
|
|
|
|
63%
|
|
59%
|
|
58%
|
|
|
|
|
International Consumer
|
|
16%
|
|
13%
|
|
14%
|
|
18%
|
|
15%
|
|
|
|
27%
|
|
20%
|
|
18%
|
|
17%
|
|
20%
|
|
|
|
20%
|
|
13%
|
|
15%
|
|
|
|
|
Worldwide Consumer
|
|
85%
|
|
73%
|
|
70%
|
|
82%
|
|
78%
|
|
|
|
81%
|
|
75%
|
|
72%
|
|
82%
|
|
77%
|
|
|
|
83%
|
|
72%
|
|
73%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Worldwide Institutional
|
|
15%
|
|
27%
|
|
30%
|
|
18%
|
|
23%
|
|
|
|
19%
|
|
25%
|
|
28%
|
|
18%
|
|
23%
|
|
|
|
17%
|
|
28%
|
|
27%
|
|
|
|
|
Total
|
|
100%
|
|
100%
|
|
100%
|
|
100%
|
|
100%
|
|
|
|
100%
|
|
100%
|
|
100%
|
|
100%
|
|
100%
|
|
|
|
100%
|
|
100%
|
|
100%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue by Market
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US Consumer
|
|
41,407
|
|
38,748
|
|
36,902
|
|
44,516
|
|
161,573
|
|
|
|
28,061
|
|
38,606
|
|
37,710
|
|
52,794
|
|
157,171
|
|
|
|
42,671
|
|
36,895
|
|
39,681
|
|
|
|
|
International Consumer
|
|
9,815
|
|
7,651
|
|
9,708
|
|
15,516
|
|
42,690
|
|
|
|
14,601
|
|
12,014
|
|
11,002
|
|
13,238
|
|
50,855
|
|
|
|
12,617
|
|
8,074
|
|
10,094
|
|
|
|
|
Worldwide Consumer
|
|
51,222
|
|
46,399
|
|
46,610
|
|
60,032
|
|
204,263
|
|
|
|
42,662
|
|
50,620
|
|
48,712
|
|
66,032
|
|
208,026
|
|
|
|
55,288
|
|
44,969
|
|
49,775
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Worldwide Institutional
|
|
11,792
|
|
14,249
|
|
14,316
|
|
14,248
|
|
54,605
|
|
|
|
14,316
|
|
16,123
|
|
15,490
|
|
14,494
|
|
60,423
|
|
|
|
14,161
|
|
15,843
|
|
14,504
|
|
|
|
|
Total
|
|
63,014
|
|
60,648
|
|
60,926
|
|
74,280
|
|
258,868
|
|
|
|
56,978
|
|
66,743
|
|
64,202
|
|
80,526
|
|
268,449
|
|
|
|
69,449
|
|
60,812
|
|
64,279
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
YoY Growth (%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US Consumer
|
|
5%
|
|
-8%
|
|
-28%
|
|
-25%
|
|
-16%
|
|
|
|
-32%
|
|
0%
|
|
2%
|
|
19%
|
|
-3%
|
|
|
|
52%
|
|
-4%
|
|
5%
|
|
|
|
|
International Consumer
|
|
297%
|
|
154%
|
|
137%
|
|
101%
|
|
147%
|
|
|
|
49%
|
|
57%
|
|
13%
|
|
-15%
|
|
19%
|
|
|
|
-14%
|
|
-33%
|
|
-8%
|
|
|
|
|
Worldwide Consumer
|
|
22%
|
|
3%
|
|
-16%
|
|
-10%
|
|
-2%
|
|
|
|
-17%
|
|
9%
|
|
5%
|
|
10%
|
|
2%
|
|
|
|
30%
|
|
-11%
|
|
2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Worldwide Institutional
|
|
39%
|
|
23%
|
|
21%
|
|
26%
|
|
26%
|
|
|
|
21%
|
|
13%
|
|
8%
|
|
2%
|
|
11%
|
|
|
|
-1%
|
|
-2%
|
|
-6%
|
|
|
|
|
Total
|
|
25%
|
|
7%
|
|
-9%
|
|
-5%
|
|
3%
|
|
|
|
-10%
|
|
10%
|
|
5%
|
|
8%
|
|
4%
|
|
|
|
22%
|
|
-9%
|
|
0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% of Total Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US Consumer
|
|
66%
|
|
64%
|
|
61%
|
|
60%
|
|
62%
|
|
|
|
49%
|
|
58%
|
|
59%
|
|
66%
|
|
58%
|
|
|
|
62%
|
|
61%
|
|
62%
|
|
|
|
|
International Consumer
|
|
15%
|
|
13%
|
|
16%
|
|
21%
|
|
17%
|
|
|
|
26%
|
|
18%
|
|
17%
|
|
16%
|
|
19%
|
|
|
|
18%
|
|
13%
|
|
15%
|
|
|
|
|
Worldwide Consumer
|
|
81%
|
|
77%
|
|
77%
|
|
81%
|
|
79%
|
|
|
|
75%
|
|
76%
|
|
76%
|
|
82%
|
|
77%
|
|
|
|
80%
|
|
74%
|
|
77%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Worldwide Institutional
|
|
19%
|
|
23%
|
|
23%
|
|
19%
|
|
21%
|
|
|
|
25%
|
|
24%
|
|
24%
|
|
18%
|
|
23%
|
|
|
|
20%
|
|
26%
|
|
23%
|
|
|
|
|
Total
|
|
100%
|
|
100%
|
|
100%
|
|
100%
|
|
100%
|
|
|
|
100%
|
|
100%
|
|
100%
|
|
100%
|
|
100%
|
|
|
|
100%
|
|
100%
|
|
100%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consumer Revenue by Channel
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DTC
|
|
31,026
|
|
25,142
|
|
27,500
|
|
34,496
|
|
118,164
|
|
|
|
31,856
|
|
30,984
|
|
31,177
|
|
42,368
|
|
136,385
|
|
|
|
36,839
|
|
30,951
|
|
35,130
|
|
|
|
|
Kiosk
|
|
9,391
|
|
8,683
|
|
7,392
|
|
9,533
|
|
34,999
|
|
|
|
7,312
|
|
7,368
|
|
6,987
|
|
8,504
|
|
30,171
|
|
|
|
6,483
|
|
4,564
|
|
4,103
|
|
|
|
|
Global Retail
|
|
9,608
|
|
11,200
|
|
9,832
|
|
15,413
|
|
46,053
|
|
|
|
2,585
|
|
10,752
|
|
9,015
|
|
14,265
|
|
36,616
|
|
|
|
10,999
|
|
8,122
|
|
8,911
|
|
|
|
|
Home School
|
|
1,197
|
|
1,374
|
|
1,886
|
|
590
|
|
5,047
|
|
|
|
909
|
|
1,516
|
|
1,533
|
|
895
|
|
4,854
|
|
|
|
967
|
|
1,332
|
|
1,631
|
|
|
|
|
Total
|
|
51,222
|
|
46,399
|
|
46,610
|
|
60,032
|
|
204,263
|
|
|
|
42,662
|
|
50,620
|
|
48,712
|
|
66,032
|
|
208,026
|
|
|
|
55,288
|
|
44,969
|
|
49,775
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
YoY Growth (%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DTC
|
|
24%
|
|
-5%
|
|
-6%
|
|
-2%
|
|
2%
|
|
|
|
3%
|
|
23%
|
|
13%
|
|
23%
|
|
15%
|
|
|
|
16%
|
|
0%
|
|
13%
|
|
|
|
|
Kiosk
|
|
14%
|
|
-7%
|
|
-25%
|
|
-28%
|
|
-14%
|
|
|
|
-22%
|
|
-15%
|
|
-5%
|
|
-11%
|
|
-14%
|
|
|
|
-11%
|
|
-38%
|
|
-41%
|
|
|
|
|
Global Retail
|
|
34%
|
|
46%
|
|
-27%
|
|
-12%
|
|
0%
|
|
|
|
-73%
|
|
-4%
|
|
-8%
|
|
-7%
|
|
-20%
|
|
|
|
325%
|
|
-24%
|
|
-1%
|
|
|
|
|
Home School
|
|
-19%
|
|
-12%
|
|
-28%
|
|
-50%
|
|
-26%
|
|
|
|
-24%
|
|
10%
|
|
-19%
|
|
52%
|
|
-4%
|
|
|
|
6%
|
|
-12%
|
|
6%
|
|
|
|
|
Total
|
|
22%
|
|
3%
|
|
-16%
|
|
-10%
|
|
-2%
|
|
|
|
-17%
|
|
9%
|
|
5%
|
|
10%
|
|
2%
|
|
|
|
30%
|
|
-11%
|
|
2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% of Total Consumer Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DTC
|
|
61%
|
|
54%
|
|
59%
|
|
57%
|
|
58%
|
|
|
|
75%
|
|
61%
|
|
64%
|
|
64%
|
|
66%
|
|
|
|
66%
|
|
69%
|
|
71%
|
|
|
|
|
Kiosk
|
|
18%
|
|
19%
|
|
16%
|
|
16%
|
|
17%
|
|
|
|
17%
|
|
15%
|
|
14%
|
|
13%
|
|
15%
|
|
|
|
12%
|
|
10%
|
|
8%
|
|
|
|
|
Global Retail
|
|
19%
|
|
24%
|
|
21%
|
|
26%
|
|
23%
|
|
|
|
6%
|
|
21%
|
|
19%
|
|
22%
|
|
17%
|
|
|
|
20%
|
|
18%
|
|
18%
|
|
|
|
|
Home School
|
|
2%
|
|
3%
|
|
4%
|
|
1%
|
|
2%
|
|
|
|
2%
|
|
3%
|
|
3%
|
|
1%
|
|
2%
|
|
|
|
2%
|
|
3%
|
|
3%
|
|
|
|
|
Total
|
|
100%
|
|
100%
|
|
100%
|
|
100%
|
|
100%
|
|
|
|
100%
|
|
100%
|
|
100%
|
|
100%
|
|
100%
|
|
|
|
100%
|
|
100%
|
|
100%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unit Metrics
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Product Unit Volume (thousands)
|
|
126.3
|
|
112.9
|
|
117.6
|
|
169.7
|
|
526.5
|
|
|
|
108.5
|
|
140.0
|
|
134.3
|
|
202.9
|
|
585.8
|
|
|
|
143.0
|
|
129.7
|
|
146.5
|
|
|
|
|
Paid Online Learners (thousands)
|
|
12.6
|
|
14.2
|
|
17.7
|
|
16.8
|
|
16.8
|
|
|
|
16.4
|
|
17.1
|
|
21.5
|
|
26.6
|
|
26.6
|
|
|
|
41.2
|
|
48.7
|
|
57.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
YoY Growth (%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Product Units
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-14%
|
|
24%
|
|
14%
|
|
20%
|
|
11%
|
|
|
|
32%
|
|
-7%
|
|
9%
|
|
|
|
|
Paid Online Learners
|
|
|
|
|
|
|
|
|
|
|
|
|
|
30%
|
|
20%
|
|
21%
|
|
58%
|
|
58%
|
|
|
|
151%
|
|
185%
|
|
167%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Net Revenue Per Unit ($)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Net Revenue per Product Unit
|
|
$395
|
|
$398
|
|
$382
|
|
$343
|
|
$376
|
|
|
|
$379
|
|
$349
|
|
$346
|
|
$313
|
|
$341
|
|
|
|
$367
|
|
$319
|
|
$313
|
|
|
|
|
Average Net Revenue per Online Learner (monthly)
|
|
$33
|
|
$35
|
|
$35
|
|
$35
|
|
$33
|
|
|
|
$30
|
|
$34
|
|
$39
|
|
$36
|
|
$31
|
|
|
|
$28
|
|
$27
|
|
$24
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
YoY Growth (%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Net Revenue per Product Unit
|
|
|
|
-4%
|
|
-12%
|
|
-9%
|
|
-9%
|
|
-9%
|
|
|
|
-3%
|
|
-9%
|
|
-9%
|
|
|
|
|
Average Net Revenue per Online Learner
|
|
|
|
-10%
|
|
-2%
|
|
10%
|
|
3%
|
|
-7%
|
|
|
|
-6%
|
|
-22%
|
|
-37%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
# of Kiosks (end of period)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US
|
|
190
|
|
186
|
|
180
|
|
173
|
|
173
|
|
|
|
144
|
|
117
|
|
114
|
|
103
|
|
103
|
|
|
|
57
|
|
56
|
|
57
|
|
|
|
|
Europe
|
|
9
|
|
10
|
|
13
|
|
15
|
|
15
|
|
|
|
15
|
|
16
|
|
14
|
|
13
|
|
13
|
|
|
|
1
|
|
1
|
|
1
|
|
|
|
|
Asia Pacific
|
|
41
|
|
50
|
|
64
|
|
71
|
|
71
|
|
|
|
78
|
|
76
|
|
69
|
|
58
|
|
58
|
|
|
|
44
|
|
42
|
|
39
|
|
|
|
|
Total # of Kiosks (end of period)
|
|
240
|
|
246
|
|
257
|
|
259
|
|
259
|
|
|
|
237
|
|
209
|
|
197
|
|
174
|
|
174
|
|
|
|
102
|
|
99
|
|
97
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues by Geography
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
United States
|
|
52,476
|
|
52,139
|
|
50,390
|
|
57,624
|
|
212,629
|
|
|
|
41,271
|
|
53,418
|
|
51,708
|
|
65,725
|
|
212,122
|
|
|
|
54,914
|
|
50,810
|
|
52,167
|
|
|
|
|
International
|
|
10,538
|
|
8,509
|
|
10,536
|
|
16,656
|
|
46,239
|
|
|
|
15,707
|
|
13,325
|
|
12,494
|
|
14,801
|
|
56,327
|
|
|
|
14,535
|
|
10,002
|
|
12,112
|
|
|
|
|
Total
|
|
63,014
|
|
60,648
|
|
60,926
|
|
74,280
|
|
258,868
|
|
|
|
56,978
|
|
66,743
|
|
64,202
|
|
80,526
|
|
268,449
|
|
|
|
69,449
|
|
60,812
|
|
64,279
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues by Geography (as a %)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
United States
|
|
83%
|
|
86%
|
|
83%
|
|
78%
|
|
82%
|
|
|
|
72%
|
|
80%
|
|
81%
|
|
82%
|
|
79%
|
|
|
|
79%
|
|
84%
|
|
81%
|
|
|
|
|
International
|
|
17%
|
|
14%
|
|
17%
|
|
22%
|
|
18%
|
|
|
|
28%
|
|
20%
|
|
19%
|
|
18%
|
|
21%
|
|
|
|
21%
|
|
16%
|
|
19%
|
|
|
|
|
Total
|
|
100%
|
|
100%
|
|
100%
|
|
100%
|
|
100%
|
|
|
|
100%
|
|
100%
|
|
100%
|
|
100%
|
|
100%
|
|
|
|
100%
|
|
100%
|
|
100%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Checks
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consumer Revenue
|
|
0
|
|
0
|
|
0
|
|
0
|
|
0
|
|
|
|
0
|
|
0
|
|
0
|
|
0
|
|
0
|
|
|
|
0
|
|
0
|
|
0
|
|
|
|
|
Total Revenue
|
|
0
|
|
0
|
|
0
|
|
0
|
|
0
|
|
|
|
0
|
|
0
|
|
0
|
|
0
|
|
0
|
|
|
|
0
|
|
0
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Prior period data has been modified where applicable to conform to
current presentation for comparative purposes.
|
Immaterial rounding differences may be present in this data in order
to conform to Financial Statement totals.
|
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|