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Digital Turbine Reports Fourth Quarter and Fiscal Full Year 2020 Results
Fourth Quarter Revenue of $39.4 Million Represents 45% Annual Growth
Revenue Growth and Operating Leverage Drove Significant Growth in GAAP Net Income and Non-GAAP Adjusted EBITDA in Fiscal 2020

Austin, TX - June 2, 2020 - Digital Turbine, Inc. (NASDAQ: APPS) announced financial results for the fiscal full year and quarter ended March 31, 2020. All operating results discussed below, except as otherwise specifically noted, refer only to the continuing operations of the Company, and all comparisons to prior periods have been adjusted to reflect only continuing operations. The Company completed its acquisition of Mobile Posse, Inc. on February 28, 2020. All operating results discussed below include the contribution of Mobile Posse’s operations for the period from February 28, 2020 through March 31, 2020.

Recent Financial Highlights:

Fiscal fourth quarter revenue was $39.4 million, representing 45% growth when compared to the fiscal fourth quarter of 2019. Fiscal year 2020 revenue totaled $138.7 million, up 34% as compared to fiscal year 2019 revenue.

GAAP net income for the fiscal fourth quarter was $14.0 million, or $0.16 per share, as compared to a GAAP net loss of $6.8 million, or ($0.09) per share for the fiscal fourth quarter of 2019. Non-GAAP adjusted net income1 for the fiscal fourth quarter was $4.2 million, or $0.05 per share, as compared to Non-GAAP adjusted net income of $2.4 million, or $0.03 per share, in the fiscal fourth quarter of 2019.

Non-GAAP adjusted EBITDA2 for the fiscal fourth quarter was $5.3 million, as compared to Non-GAAP adjusted EBITDA of $3.3 million in the fiscal fourth quarter of 2019. Non-GAAP adjusted EBITDA for full year fiscal 2020 totaled $19.6 million, representing 120% growth when compared to Non-GAAP adjusted EBITDA of $8.9 million in fiscal year 2019.

GAAP cash provided by operating activities totaled $13.5 million in the fiscal fourth quarter. Non-GAAP free cash flow3 totaled $11.8 million in the fiscal fourth quarter. The Company had total cash and cash equivalents of $21.5 million as of March 31, 2020.

GAAP gross margin was 39% for the fiscal fourth quarter of 2020, as compared to 40% in the fiscal fourth quarter of 2019. Non-GAAP adjusted gross margin4 was 40% for the fiscal fourth quarter of 2020, as compared to 42% in the fiscal fourth quarter of 2019.

The Company has surpassed 405 million total devices with Ignite installed to date, including more than 40 million devices installed during the fiscal fourth quarter.

“We executed well in our fiscal fourth quarter, delivering results that exceeded our expectations while completing the highly strategic Mobile Posse acquisition and tactically navigating the onset of unique challenges and opportunities presented by COVID-19,” said Bill Stone, CEO. “I am incredibly grateful for the resilience, focus, and determination shown by the entire Digital Turbine team, which has enabled our business to quickly adapt to rapidly evolving market trends during these dynamic times. Today, more than ever, consumers are turning to their mobile devices and applications for information, socialization,


Digital Turbine Fourth Quarter and Fiscal 2020 Results
June 2, 2020
Page 2

entertainment, education, and home delivery services, and Digital Turbine values its critical role in helping to connect consumers to this content.”

“Looking ahead to fiscal 2021 and the pursuit of our primary growth objectives, we are highly confident given the strengthening momentum underlying our business today. We remain laser-focused on operational execution in support of our valued partners, advertisers on our platform, and mobile end-users everywhere. While we expect some near-term uncertainty in terms of device activations amid carrier store closures and associated re-opening timelines, we could not be more pleased with the clear strength in demand that we are witnessing from key advertiser segments, most notably within the mobile gaming, social media, news, content streaming, and home delivery segments that collectively comprise the overwhelming majority of our app installs. We expect consumers’ increased usage of these types of apps to continue well beyond the current period, which we believe should continue to provide an upward bias to conversion rates and revenue-per-device trends even as device activation levels return to normalized levels. Furthermore, like many others in the mobile industry, we eagerly look forward to broader promotion and adoption of 5G devices later this year as a possible catalyst for increased activations and richer application-based services.”

Mr. Stone concluded, “We believe that our motivated team, profitable operating model, healthy balance sheet, and unique platform offering give us the confidence to not just be able to weather near-term macro conditions, but to be able to continue to grow both our top and bottom lines despite these conditions.”

Fourth Quarter Fiscal 2020 Financial Results

Results for the fourth quarter and full fiscal year 2020 include the results of the acquired Mobile Posse operations from February 28, 2020 through March 31, 2020. Revenue for the fourth quarter of fiscal 2020 was $39.4 million, representing an increase of 45% year-over-year.

GAAP gross margin was 39% for the fourth quarter of fiscal 2020, as compared to a 40% GAAP gross margin in the fourth quarter of fiscal 2019. Non-GAAP adjusted gross margin4 was 40% for the fourth quarter of fiscal 2020, as compared to 42% for the fourth quarter of fiscal 2019.

GAAP net income from continuing operations for the fourth quarter of fiscal 2020 was $14.0 million, or $0.16 per share, as compared to a GAAP net loss from continuing operations for the fourth quarter of fiscal 2019 of $6.8 million, or ($0.09) per share. Non-GAAP adjusted net income1 for the fourth quarter of fiscal 2020 was $4.2 million, or $0.05 per share, as compared to Non-GAAP adjusted net income of $2.4 million, or $0.03 per share, during the fourth quarter of fiscal 2019.

Non-GAAP adjusted EBITDA2 was $5.3 million for the fourth quarter of fiscal 2020, as compared to Non-GAAP adjusted EBITDA of $3.3 million for the fourth quarter of fiscal 2019. The reconciliations between GAAP and Non-GAAP financial results for all referenced periods are provided in the tables immediately following the Unaudited Consolidated Statements of Cash Flows below.

Full Year Fiscal 2020 Financial Results

Revenue for fiscal 2020 totaled $138.7 million, representing an increase of 34% as compared to revenue of $103.6 million in fiscal 2019.

GAAP gross margin was 39% for fiscal 2020, as compared to a 34% GAAP gross margin in fiscal 2019. Non-GAAP adjusted gross margin4 was 40% for fiscal 2020, as compared to 36% in fiscal 2019.


Digital Turbine Fourth Quarter and Fiscal 2020 Results
June 2, 2020
Page 3


GAAP net income from continuing operations for fiscal 2020 was $14.3 million, or $0.17 per share, as compared to a GAAP net loss from continuing operations for fiscal 2019 of $4.3 million, or ($0.06) per share. Non-GAAP adjusted net income1 for fiscal 2020 was $17.5 million, or $0.20 per share, as compared to Non-GAAP adjusted net income of $5.9 million, or $0.08 per share, in fiscal 2019.

Non-GAAP adjusted EBITDA2 was $19.6 million for fiscal 2020, as compared to Non-GAAP adjusted EBITDA of $8.9 million in fiscal 2019. The reconciliations between GAAP and Non-GAAP financial results for all referenced periods are provided in the tables immediately following the Unaudited Consolidated Statements of Cash Flows below.

Business Outlook

Based on information available as of June 2, 2020, the Company expects first quarter fiscal 2021 revenue of between $47 million and $50 million, and Non-GAAP adjusted EBITDA2 of between $8 million and $10 million.

It is not reasonably practicable to provide a business outlook for GAAP net income/(loss) from continuing operations because the Company cannot reasonably estimate the changes in stock-based compensation expense, which is directly impacted by changes in the Company’s stock price, or other items that are difficult to predict with precision.

About Digital Turbine, Inc.

Digital Turbine simplifies content discovery and delivers relevant content directly to consumer devices. The Company’s on-demand media platform powers frictionless app and content discovery, user acquisition and engagement, operational efficiency, and monetization opportunities. Digital Turbine’s technology platform has been adopted by more than 40 mobile operators and OEMs worldwide and has delivered more than three billion app preloads for tens of thousands of advertising campaigns. The company is headquartered in Austin, Texas, with global offices in Arlington, Durham, Mumbai, San Francisco, Singapore, and Tel Aviv. For additional information, visit www.digitalturbine.com.

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Conference Call

Management will host a conference call today at 4:30 p.m. ET to discuss its fourth quarter and full fiscal year 2020 financial results and provide operational updates on the business and issue additional commentary on the Mobile Posse acquisition. To participate, interested parties should dial 855-238-2713 in the United States or 412-542-4111 from international locations. A webcast of the conference call will be available at ir.digitalturbine.com/events.

For those who are not able to join the live call, a playback will be available through June 9, 2020. The replay can be accessed by dialing 877-344-7529 in the United States or 412-317-0088 from international locations, passcode 10144552.

The conference call will discuss guidance and other material information.



Digital Turbine Fourth Quarter and Fiscal 2020 Results
June 2, 2020
Page 4

Use of Non-GAAP Financial Measures

To supplement the Company’s consolidated financial statements presented in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”), Digital Turbine uses non-GAAP measures of certain components of financial performance. These non-GAAP measures include non-GAAP adjusted net income and earnings per share (“EPS”), non-GAAP adjusted gross profit, non-GAAP adjusted gross margin, non-GAAP adjusted EBITDA, and non-GAAP free cash flow. Reconciliations to the nearest GAAP measures of all non-GAAP measures included in this press release can be found in the tables below.

Non-GAAP measures are provided to enhance investors’ overall understanding of the Company's current financial performance, prospects for the future and as a means to evaluate period-to-period comparisons. The Company believes that these Non-GAAP measures provide meaningful supplemental information regarding financial performance by excluding certain expenses and benefits that may not be indicative of recurring core business operating results. The Company believes the Non-GAAP measures that exclude such items when viewed in conjunction with GAAP results and the accompanying reconciliations enhance the comparability of results against prior periods and allow for greater transparency of financial results. The Company believes Non-GAAP measures facilitate management's internal comparison of its financial performance to that of prior periods as well as trend analysis for budgeting and planning purposes. The presentation of Non-GAAP measures is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.

1Non-GAAP adjusted net income and EPS are defined as GAAP net income/(loss) and EPS adjusted to exclude the effect of stock-based compensation, amortization of intangibles, changes in the fair value of derivatives associated with warrants issued in connection with the September 2016 convertible notes offering, loss on extinguishment of debt, tax adjustments, and transaction expenses. Readers are cautioned that Non-GAAP adjusted net income and EPS should not be construed as an alternative to comparable GAAP net income figures determined in accordance with U.S. GAAP as an indicator of profitability or performance, which is the most comparable measure under GAAP.

2Non-GAAP adjusted EBITDA is calculated as GAAP net income/(loss) excluding the following cash and non-cash expenses: net interest income/(expense), foreign exchange transaction loss, income tax provision, depreciation and amortization, stock-based compensation expense, amortization of intangibles, the change in fair value of derivatives associated with warrants issued in connection with the September 2016 convertible notes offering, other expense, loss on extinguishment of debt, non-recurring severance expense, and transaction expenses. Readers are cautioned that Non-GAAP adjusted EBITDA should not be construed as an alternative to net income/(loss) determined in accordance with U.S. GAAP as an indicator of performance, which is the most comparable measure under GAAP.

3Non-GAAP free cash flow, which is a non-GAAP financial measure, is defined as net cash provided by operating activities (as stated in our Consolidated Statement of Cash Flows) reduced by capital expenditures. Readers are cautioned that free cash flow should not be construed as an alternative to net cash provided by operating activities determined in accordance with U.S. GAAP as an indicator of profitability, performance or liquidity, which is the most comparable measure under GAAP.

4Non-GAAP adjusted gross profit and gross margin are defined as GAAP gross profit and gross margin adjusted to exclude the effect of intangible amortization expense and depreciation of software. Readers are cautioned that Non-GAAP adjusted gross profit and gross margin should not be construed as an


Digital Turbine Fourth Quarter and Fiscal 2020 Results
June 2, 2020
Page 5

alternative to gross margin determined in accordance with U.S. GAAP as an indicator of profitability or performance, which is the most comparable measure under GAAP.

Non-GAAP adjusted gross profit and gross margin, Non-GAAP adjusted EBITDA, Non-GAAP adjusted net income and EPS, and Non-GAAP free cash flow are used by management as internal measures of profitability, performance, and liquidity. They have been included because the Company believes that the measures are used by certain investors to assess the Company’s financial performance before non-cash charges and certain costs that the Company does not believe are reflective of its underlying business.

Forward-Looking Statements

This news release includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements in this news release that are not statements of historical fact and that concern future results from operations, financial position, economic conditions, product releases, and any other statement that may be construed as a prediction of future performance or events, including financial projections and growth in various products, are forward-looking statements that speak only as of the date made and involve known and unknown risks, uncertainties, and other factors that may, should one or more of these risks uncertainties or other factors materialize, cause actual results to differ materially from those expressed or implied by such statements. These factors and risks include:

a decline in general economic conditions nationally and internationally
decreased market demand for our products and services
market acceptance and brand awareness of our products
risks associated with indebtedness
the ability to comply with financial covenants in outstanding indebtedness
the ability to protect our intellectual property rights
risks associated with Ignite adoption among existing customers (including the impact of possible delays with major carrier and OEM partners in the roll-out for mobile phones deploying Ignite)
actual mobile device sales and sell-through where Ignite is deployed is out of our control
risks associated with our ability to manage the business amid the COVID-19 pandemic
the impact of COVID-19 on our partners, digital advertising spend, and consumer purchase behavior
the impact of COVID-19 on our results of operations
risks associated with new privacy laws, such as the European Union’s GDPR and similar laws, which may require changes to our development and user interface for certain functionality of our mobile platform
risks associated with the timing of Ignite software pushes to the embedded bases of carrier and OEM partners
risks associated with end-user take rates of carrier and OEM software pushes, which include Ignite
new customer adoption and time to revenue with new carrier and OEM partners is subject to delays and factors out of our control
risks associated with fluctuations in the number of Ignite slots across US carrier partners
required customization and technical integration, which may slow down time to revenue, notwithstanding the existence of a distribution agreement
risks associated with delays in major mobile phone launches, or the failure of such launches to achieve scale
customer adoption that either we or the market may expect


Digital Turbine Fourth Quarter and Fiscal 2020 Results
June 2, 2020
Page 6

the difficulty of extrapolating monthly demand to quarterly demand
the challenges, given the Company’s comparatively small size, to expand the combined Company's global reach, accelerate growth, and create a scalable, low-capex business model that drives EBITDA (as well as adjusted EBITDA)
ability as a smaller Company to manage international operations
varying and often unpredictable levels of orders; the challenges inherent in technology development necessary to maintain the Company's competitive advantage, such as adherence to release schedules and the costs and time required for finalization and gaining market acceptance of new products
changes in economic conditions and market demand
rapid and complex changes occurring in the mobile marketplace
pricing and other activities by competitors
technology management risk, as the Company needs to adapt to complex specifications of different carriers and the management of a complex technology platform, given the Company's relatively limited resources
risks and uncertainties associated with the integration of the acquisition of Mobile Posse, including our ability to realize the anticipated benefits of the acquisition and the satisfaction of related earn-out provisions
other risks including those described from time-to-time in Digital Turbine's filings on Forms 10-K and 10-Q with the Securities and Exchange Commission (SEC), press releases, and other communications.

You should not place undue reliance on these forward-looking statements. The Company does not undertake to update forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law.
Investor Relations Contacts:
Brian Bartholomew
Digital Turbine, Inc.
brian.bartholomew@digitalturbine.com

SOURCE Digital Turbine, Inc.


















Digital Turbine Fourth Quarter and Fiscal 2020 Results
June 2, 2020
Page 7

Digital Turbine, Inc. and Subsidiaries
Consolidated Statements of Operations and Comprehensive Income / (Loss)
(in thousands, except per share amounts)
 
 
3 Months Ended March 31,
 
12 Months Ended March 31,
 
 
2020
 
2019
 
2020
 
2019
 
 
(Unaudited)

 
(Unaudited)

 
 
 
 
Net revenues
 
$
39,351

 
$
27,192

 
$
138,715

 
$
103,569

Costs of revenues
 
 
 
 
 
 
 
 
License fees and revenue share
 
23,591

 
15,768

 
83,588

 
65,981

Other direct costs of revenues
 
432

 
470

 
1,454

 
2,023

Total cost of revenues
 
24,023

 
16,238

 
85,042

 
68,004

Gross profit
 
15,328

 
10,954

 
53,673

 
35,565

Operating expenses
 
 
 
 
 
 
 
 
Product development
 
3,706

 
2,702

 
12,018

 
10,876

Sales and marketing
 
3,710

 
2,501

 
11,244

 
8,212

General and administrative
 
4,987

 
3,817

 
17,199

 
13,032

Total operating expenses
 
12,403

 
9,020

 
40,461

 
32,120

Income / (loss) from operations
 
2,925

 
1,934

 
13,212

 
3,445

Interest and other income / (expense), net
 
 
 
 
 
 
 
 
Interest income / (expense)
 
(77
)
 
(472
)
 
41

 
(1,120
)
Foreign exchange transaction gain / (loss)
 

 
(3
)
 

 
3

Change in fair value of convertible note embedded derivative liability
 

 
(2,104
)
 

 
(1,008
)
Change in fair value of warrant liability
 
1,021

 
(5,720
)
 
(9,580
)
 
(4,875
)
Loss on extinguishment of debt
 

 
(421
)
 

 
(431
)
Other income / (expense)
 
(223
)
 
336

 
232

 
153

Total interest and other income / (expense), net
 
721

 
(8,384
)
 
(9,307
)
 
(7,278
)
Income / (loss) from continuing operations before income taxes
 
3,646

 
(6,450
)
 
3,905

 
(3,833
)
Income tax (benefit) / provision
 
(10,381
)
 
312

 
(10,375
)
 
469

Income / (loss) from continuing operations, net of taxes
 
14,027

 
(6,762
)
 
14,280

 
(4,302
)
Loss from discontinued operations
 
(209
)
 
(96
)
 
(380
)
 
(1,708
)
Loss from discontinued operations, net of taxes
 
(209
)
 
(96
)
 
(380
)
 
(1,708
)
Net income / (loss)
 
13,818

 
(6,858
)
 
13,900

 
(6,010
)
Foreign currency translation adjustment
 
129

 
(26
)
 
(235
)
 
(31
)
Comprehensive income / (loss)
 
$
13,947

 
$
(6,884
)
 
$
13,665

 
$
(6,041
)
Basic net income / (loss) per common share
 
 
 
 
 
 
 
 
Continuing operations
 
0.16

 
(0.09
)
 
0.17

 
(0.06
)
Discontinued operations
 

 

 

 
(0.02
)
Basic net income / (loss) per common share
 
$
0.16

 
$
(0.09
)
 
$
0.17

 
$
(0.08
)
Weighted-average common shares outstanding, basic
 
86,784

 
79,404

 
84,594

 
77,440

Diluted net income / (loss) per common share
 
 
 
 
 
 
 
 
Continuing operations
 
0.15

 
(0.09
)
 
0.16

 
(0.06
)
Discontinued operations
 

 

 

 
(0.02
)
Diluted net income / (loss) per common share
 
$
0.15

 
$
(0.09
)
 
$
0.16

 
$
(0.08
)
Weighted-average common shares outstanding, diluted
 
91,875

 
79,404

 
89,558

 
77,440



Digital Turbine Fourth Quarter and Fiscal 2020 Results
June 2, 2020
Page 8

Digital Turbine, Inc. and Subsidiaries
Consolidated Balance Sheets
(in thousands, except par value and share amounts)
 
 
March 31, 2020
 
March 31, 2019
ASSETS
 
 
 
 
Current assets
 
 
 
 
Cash
 
$
21,534

 
$
10,894

Restricted cash
 
125

 
165

Accounts receivable, net of allowances of $4,059 and $895, respectively
 
33,135

 
22,707

Prepaid expenses and other current assets
 
3,653

 
1,331

Current assets held for disposal
 

 
2,026

Total current assets
 
58,447

 
37,123

Property and equipment, net
 
8,183

 
3,430

Right-of-use assets
 
4,237

 

Deferred tax assets
 

 
40

Intangible assets, net
 
43,882

 

Goodwill
 
69,262

 
42,268

TOTAL ASSETS
 
$
184,011

 
$
82,861

LIABILITIES AND STOCKHOLDERS' EQUITY
 
 
 
 
Current liabilities
 
 
 
 
Accounts payable
 
$
31,579

 
$
14,912

Accrued license fees and revenue share
 
19,423

 
16,205

Accrued compensation
 
4,311

 
2,441

Accrued earn-out
 
23,735

 

Short-term debt, net of debt issuance costs of $62 and $0, respectively
 
1,188

 

Other current liabilities
 
2,573

 
826

Current liabilities held for disposal
 

 
3,924

Total current liabilities
 
82,809

 
38,308

Long-term debt, net of debt issuance costs of $245 and $0, respectively
 
18,505

 

Warrant liability
 

 
8,013

Other non-current liabilities
 
5,243

 
182

Total liabilities
 
106,557

 
46,503

Stockholders' equity
 
 
 
 
Preferred stock
 
 
 
 
Series A convertible preferred stock at $0.0001 par value; 2,000,000 shares authorized, 100,000 issued and outstanding (liquidation preference of $1,000)
 
100

 
100

Common stock
 
 
 
 
$0.0001 par value: 200,000,000 shares authorized; 88,041,240 issued and 87,306,784 outstanding at March 31, 2020; 82,354,940 issued and 81,620,485 outstanding at March 31, 2019
 
10

 
10

Additional paid-in capital
 
360,224

 
332,793

Treasury stock (754,599 shares at March 31, 2020 and March 31, 2019)
 
(71
)
 
(71
)
Accumulated other comprehensive loss
 
(591
)
 
(356
)
Accumulated deficit
 
(282,218
)
 
(296,118
)
Total stockholders' equity
 
77,454

 
36,358

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
 
$
184,011

 
$
82,861






Digital Turbine Fourth Quarter and Fiscal 2020 Results
June 2, 2020
Page 9

Digital Turbine, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(in thousands)
 
 
3 Months Ended March 31,
 
 
2020
 
2019
 
 
(Unaudited)
 
(Unaudited)
Cash flows from operating activities
 
 

 
 

Net income / (loss) from continuing operations, net of taxes
 
$
14,027

 
$
(6,762
)
Adjustments to reconcile net income / (loss) to net cash used in operating activities:
 
 
 
 
Depreciation and amortization
 
858

 
621

Change in allowance for doubtful accounts
 
2,660

 
(42
)
Loss on disposal of fixed assets
 
(4
)
 

Non-cash interest expense
 
6

 
547

Stock-based compensation
 
666

 
595

Stock-based compensation for services rendered
 
173

 
155

Change in fair value of convertible note embedded derivative liability
 

 
2,104

Change in fair value of warrant liability
 
(1,021
)
 
5,720

Loss on extinguishment of debt
 

 
406

(Increase) / decrease in assets:
 
 
 
 
Accounts receivable
 
1,762

 
1,586

Deposits
 

 
10

Deferred tax assets
 

 
399

Prepaid expenses and other current assets
 
82

 
121

Right-of-use asset
 
171

 

Increase / (decrease) in liabilities:
 
 
 
 
Accounts payable
 
10,260

 
(7,640
)
Accrued license fees and revenue share
 
(3,689
)
 
4,715

Accrued compensation
 
806

 
820

Other current liabilities
 
(2,419
)
 
(1,041
)
Other non-current liabilities
 
(10,823
)
 
127

Net cash provided by operating activities - continuing operations
 
13,515

 
2,441

Net cash used in operating activities - discontinued operations
 
(2,148
)
 
(265
)
Net cash provided by operating activities
 
11,367

 
2,176

 
 
 
 
 
Cash flows from investing activities
 
 
 
 
Capital expenditures
 
(1,666
)
 
(533
)
Acquisition of Mobile Posse, net of cash recieved
 
(41,872
)
 

Net cash used in investing activities
 
(43,538
)
 
(533
)
 
 
 
 
 
Cash flows from financing activities
 
 
 
 
Proceeds from borrowings
 
20,000

 

Payment of debt issuance costs
 
(313
)
 

Options and warrants exercised
 
135

 
511

Repayment of debt obligations
 

 
(1,600
)
Net cash provided by / (used in) financing activities
 
19,822

 
(1,089
)
 
 
 
 
 
Effect of exchange rate changes on cash
 
129

 
(26
)
 
 
 
 
 
Net change in cash
 
(12,220
)
 
528

 
 
 
 
 
Cash and restricted cash, beginning of year
 
33,879

 
10,531

 
 
 
 
 
Cash and restricted cash, end of year
 
$
21,659

 
$
11,059



Digital Turbine Fourth Quarter and Fiscal 2020 Results
June 2, 2020
Page 10

GAAP GROSS MARGIN TO NON-GAAP GROSS MARGIN
 
 
 
 
(in thousands)
 
 
 
 
 
 
 
 
 
 
3 Months Ended March 31,
 
12 Months Ended March 31,
 
 
2020
 
2019
 
2020
 
2019
 
 
(Unaudited)

 
(Unaudited)

 
(Unaudited)

 
(Unaudited)

Continuing operations
 
 
 
 
 
 
 
 
Revenue
 
$
39,351

 
$
27,192

 
$
138,715

 
$
103,569

Gross profit
 
15,329

 
10,954

 
53,673

 
35,565

Gross margin percentage
 
39.0
%
 
40.3
%
 
38.7
%
 
34.3
%
Add-back items:
 
 
 
 
 
 
 
 
Amortization of intangibles
 

 
224

 

 
1,230

Depreciation of software
 
431

 
148

 
1,454

 
696

Non-GAAP gross profit from continuing operations
 
$
15,760

 
$
11,326

 
$
55,127

 
$
37,491

Non-GAAP gross margin percentage from continuing operations
 
40.0
%
 
41.7
%
 
39.7
%
 
36.2
%
 
 
 
 
 
 
 
 
 
GAAP NET INCOME / (LOSS) TO NON-GAAP ADJUSTED NET INCOME
 
 
 
 
(in thousands)
 
 
 
 
 
 
 
 
 
 
3 Months Ended March 31,
 
12 Months Ended March 31,
 
 
2020
 
2019
 
2020
 
2019
 
 
(Unaudited)

 
(Unaudited)

 
(Unaudited)

 
(Unaudited)

Continuing operations
 
 
 
 
 
 
 
 
Net income / (loss) from continuing operations
 
$
14,027

 
$
(6,763
)
 
$
14,280

 
$
(4,303
)
Add-back items:
 
 
 
 
 
 
 
 
Stock and stock option compensation
 
839

 
750

 
3,353

 
2,531

Amortization of intangibles
 
218

 
224

 
218

 
1,230

Change in fair value of convertible note embedded derivative and warrant liability
 
(1,021
)
 
7,824

 
9,580

 
5,883

Loss on extinguishment of debt
 

 
406

 

 
431

Non-recurring severance expense
 

 

 

 
145

Tax adjustment (1)
 
(10,552
)
 

 
(10,552
)
 

Transaction expenses
 
657

 

 
657

 

Non-GAAP adjusted net income from continuing operations
 
$
4,168

 
$
2,441

 
$
17,536

 
$
5,917

Non-GAAP adjusted net income per share from continuing operations
 
$
0.05

 
$
0.03

 
$
0.20

 
$
0.08

Weighted-average common shares outstanding, diluted
 
91,875

 
79,404

 
89,558

 
77,440

(1) Valuation allowance release due to purchase price allocation of Mobile Posse.


Digital Turbine Fourth Quarter and Fiscal 2020 Results
June 2, 2020
Page 11

GAAP NET INCOME / (LOSS) TO NON-GAAP ADJUSTED EBITDA
 
 
 
 
(in thousands)
 
 
 
 
 
 
 
 
 
 
3 Months Ended March 31,
 
12 Months Ended March 31,
 
 
2020
 
2019
 
2020
 
2019
 
 
(Unaudited)

 
(Unaudited)

 
(Unaudited)

 
(Unaudited)

Continuing operations
 
 
 
 
 
 
 
 
Net income / (loss) from continuing operations
 
$
14,027

 
$
(6,763
)
 
$
14,280

 
$
(4,303
)
Add-back items:
 
 
 
 
 
 
 
 
Stock and stock option compensation
 
839

 
750

 
3,353

 
2,531

Amortization of intangibles
 
218

 
224

 
218

 
1,230

Depreciation expense
 
620

 
396

 
2,124

 
1,535

Interest (income) / expense, net
 
77

 
472

 
(41
)
 
1,120

Other (income) / expense, net
 
223

 
(316
)
 
(246
)
 
(139
)
Change in fair value of convertible note embedded derivative liability and warrant liability
 
(1,021
)
 
7,824

 
9,580

 
5,883

Loss on extinguishment of debt
 

 
406

 

 
425

Non-recurring severance expense
 

 

 

 
145

Foreign exchange transaction (gain) / loss
 

 
4

 
1

 
(2
)
Income tax provision / (benefit)
 
(10,381
)
 
312

 
(10,375
)
 
469

Transaction expenses
 
657

 

 
657

 

Non-GAAP adjusted EBITDA from continuing operations
 
$
5,259

 
$
3,309

 
$
19,551

 
$
8,894

GAAP CASH FLOW FROM OPERATING ACTIVITIES FROM CONTINUING OPERATIONS TO NON-GAAP FREE CASH FLOW FROM CONTINUING OPERATIONS
(in thousands)
 
 
 
 
 
 
3 Months Ended March 31,
 
 
2020
 
2019
 
 
(Unaudited)
 
(Unaudited)
Net cash provided by operating activities from continuing operations
 
13,515

 
2,441

Capital expenditures
 
(1,666
)
 
(533
)
Non-GAAP free cash flow provided by continuing operations
 
$
11,849

 
$
1,908