In addition to missing Q2 revenue estimates (while beating on EPS), YUME has lowered its full-year revenue guidance by $10M to $180M-$190M (consensus is at $193.8M), and its adjusted EBITDA guidance to $0-$4M from $2M-$8M.
Q3 revenue guidance of $43M-$45M is in-line with a $44.2M consensus. On the CC (transcript), CEO Jayant Kadambi attributed the full-year guidance cut to "the typical lack of Q4 visibility at this point in the year."
Deutsche's Ross Sandler asked if YuMe, which has plenty of video ad tech rivals, is willing to sacrifice its high gross margin (48.8% in Q2) to boost growth. He also pressed the company on flat growth among top-20 advertisers (42% of revenue).
Kadambi argued YuMe's superior targeting abilities for video brand advertisers will help it maintain high margins, and attributed the top-20 softness to lower spending from one major pharma client.
YuMe had 428 ad clients in Q2, up from 351 in Q1 and 301 a year ago. However, average revenue/client fell to $93K from $104K in Q1 and $112K a year ago.
GAAP opex rose 33% Y/Y to $22M, with sales/marketing spend rising 46% to $15.9M.
Q2 results, PR