Perion Network (NASDAQ: PERI) reported Q1 EPS of $0.19, $0.17 better than the analyst estimate of $0.02. Revenue for the quarter came in at $89.8 million versus the consensus estimate of $86.18 million.

Financial Comparison for the First Quarter of 2021

• Revenues: Revenues increased by 36% (or 26% on a pro forma basis), from $66.1 million in the first quarter of 2020 to $89.8 million in the first quarter of 2021. This increase was primarily attributable to a 61% (or 32% on a pro forma basis), increase in Display and Social Advertising revenues, mainly from the CTV solution which served as a key driver to 11% higher average deal size, as well as accelerated growth in revenues from our Content Monetization solution which has been adopted by 3 new publishers during the first quarter of 2021. Search Advertising and other revenues increased by 22%, primarily due to a record 17.7 million of average daily monetizable search queries we delivered to Microsoft Bing compared to 12.2 million in the first quarter of 2020 and increased number of new publishers.
• Customer Acquisition Costs (“CAC”): CAC in the first quarter of 2021 were $54.9 million, or 61% of revenues, compared to $36.1 million, or 55% of revenues, in the first quarter of 2020. The increase as a percentage of revenues is primarily due to the acquisition of Pub Ocean and product mix.
• Net Income: On a GAAP basis, net income increased by 148% from $1.3 million in the first quarter of 2020 to $3.3 million in the first quarter of 2021.
• Non-GAAP Net Income: In the first quarter of 2021, non-GAAP net income was $7.0 million, or 8% of revenues, compared to the $5.0 million, or 8% of revenues in the first quarter of 2020. A reconciliation of GAAP to non-GAAP net income is included in this press release.
• Adjusted EBITDA: In the first quarter of 2021, Adjusted EBITDA was $8.8 million, or 10% of revenues, compared to $6.2 million, or 9% of revenues, in the first quarter of 2020. A reconciliation of GAAP Net Income to Adjusted EBITDA is included in this press release.
• Cash and Cash Flow from Operations: As of March 31, 2021, cash and cash equivalents and short-term bank deposits were $128.0 million. Cash provided from operations in the first quarter of 2021 was $13.5 million, compared to $2.5 million in the first quarter of 2020. During the first quarter of 2021, Perion raised $61 million through a follow-on public offering.
• Short-Term Debt, Long-term Debt and Convertible Debt: As of March 31, 2021, Perion has fully repaid all outstanding debt.

Doron Gerstel, Perion’s CEO, commented, “Our diversified cross-channel offering and our unique capability to generate revenues from both the demand and supply sides of the open internet, were key factors to the accelerating revenues growth which began in 2020. Our strong momentum continued in the first quarter as we achieved a 36% increase in consolidated revenues, with Display and Social Advertising revenues increasing 61% year-over-year. Importantly, we achieved this while maintaining our strong profitability metrics and positive cash generation.”

Mr. Gerstel added “With continued momentum and strong adoption of our technology, we are raising our full-year revenues outlook to $400 million at the mid-point, representing second consecutive year with annual growth of more than 20%. We are also reaffirming our strategy to deliver substantial value to our stakeholders and achieving our 2023 goal of $500 million in annual revenues sooner than originally anticipated.”

GUIDANCE:

Perion Network sees FY2021 revenue of $390-410 million, versus the consensus of $375.56 million.

• Based on the strong first quarter and management’s outlook for the remainder of the year, Perion increases its full-year guidance. In 2021, management expects to generate revenues of $390 million to $410 million and Adjusted EBITDA of $39 million to $41 million, versus prior guidance of $370 million to $380 million and $37 million to $38 million, respectively.

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