Perion Network (NASDAQ: PERI) reported Q1 EPS of $0.17, $0.14 better than the analyst estimate of $0.03. Revenue for the quarter came in at $66.1 million versus the consensus estimate of $65.87 million.

Q1 2020 Highlights:

• Total Revenues of $66.1 million, increased 23% year-over-year;
• GAAP Net Income of $1.3 million, increased 8% year-over-year;
• Non-GAAP Net Income of $5.0 million, increased 53% year-over-year;
• GAAP Earnings Per Share of $0.05, no change year-over-year;
• Adjusted EBITDA of $6.2 million, increased 22% year-over-year;
• Net Cash provided from operations was $2.5 million; decreased 82% year-over-year;
• Net Cash decreased from $45.0 million to $39.5, inclusive of the $15.1 million paid at closing to acquire ContentIQ.

Doron Gerstel, Perion’s CEO commented, “The strong momentum that we experienced in the fourth quarter of 2019 continued in the first quarter of 2020. Our results were trending at record levels in January and February, which led to consolidated revenue growth of 23% for the full quarter. Our results were driven by the robust performance of our Search business and the contribution of ContentIQ (CIQ) which we acquired mid-January. Since the beginning of March, we have been navigating a rapidly changing business environment as the COVID-19 pandemic unfolded, driving a 15%-25% decline in advertising spending.”

“As the first quarter progressed and the impact of the COVID-19 pandemic became more pronounced, we swiftly began rolling out strategic initiatives to better prepare Perion for an uncertain market environment with reduced levels of advertising spending,” Gerstel added. “As part of this effort, we implemented cost-saving measures that are expected to yield more than $10 million in annualized savings on a proforma basis. Like others, we are cautiously optimistic that we will begin to see improvements in the overall market later this year. Nonetheless, with $54 million in cash, $40 million in net cash and the ability to generate significant free cash flow from ongoing operations, we have the financial stability to weather an extended period of disruption should it occur. The current management team’s demonstrated track record for managing costs, preserving cash and maximizing profitability, gives me confidence in our financial resilience and ability to withstand uncertainty.”

“The revenue flexibility provided by our product diversity and business mix across the three pillars of digital advertising, contributed to our Q1 success and is critical to our long-term prospects,” Gerstel continued. “CIQ performed well throughout the quarter and in line with expectations, demonstrating the strength and resiliency that our diversification provides. We are fortunate to have a highly focused and differentiated advertising offering which conceptually brings brands, agencies and publishers together – benefiting from a common digital advertising offering.”

Gerstel added, “With regard to the remainder of the year, the disruption in the advertising market and lack of visibility have caused us to join many other public companies who have made the prudent decision to temporarily withdraw full-year guidance. As the horizon becomes clearer and our visibility improves, we hope to return to providing estimates about expected results. We remain confident, that we have the diversification, product offerings and management discipline needed to generate significant cash from operations and remain profitable, for the full year, as we weather the uncertainty of the current environment.”

“We are navigating the current environment from a stable financial position that is superior to many companies in our industry,” concluded Gerstel. “Our organic and inorganic efforts to boost topline revenue remain our top priority. We’ve realized that more and more companies in our industry with excellent, complementary products, services and technologies lack the financial strength to weather a period of disruption. As a result, we have made the strategic decision to file a shelf registration statement, to assess M&A opportunities as they become available.”

For earnings history and earnings-related data on Perion Network (PERI) click here.