UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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Item 2.02. Results of Operations and Financial Condition.
On August 12, 2021, Integral Ad Science Holding Corp. (the “Company”) filed its Quarterly Report on Form 10-Q for the second quarter ended June 30, 2021 (the “10-Q”). Recently and subsequent to the issuance of the 10-Q, the Company determined that in calculating net revenue retention of advertising customers (“NRR”), it had inadvertently understated the existing customer revenue cohort (denominator) for certain periods. This resulted in NRR being overstated as of June 30, 2021 and 2020 and March 31, 2020. As corrected, NRR as of each of those dates was as follows:
| June 30, 2021 | June 30, 2020 | March 31, 2020 | ||||||||||
| Net revenue retention of advertising customers |
126 | % | 109 | % | 115 | % | ||||||
NRR for the full year 2020 remains unchanged at 108%. As corrected, the period over period change in NRR from June 30, 2020 to June 30, 2021, and from March 31, 2020 to June 30, 2020, still represents a similar performance on a comparable basis. The Company expects NRR in future annual periods to be consistent with its target of approximately 120%.
Additionally, the 10-Q referred to the total advertising customer count as being 2,155, when in fact that number represented the total customer count comprised of 2,018 advertisers and 137 publishers, as it was correctly described in management’s prepared remarks on the earnings call for the second quarter ended June 30, 2021.
Increased guidance
The corrections described above did not impact the condensed consolidated financial statements of the Company that were prepared in conformity with accounting principles generally accepted in the United States (“GAAP”) and included in the 10-Q. As previously reported, total revenue for the second quarter of 2021 was $75.1 million, a 55% increase compared to $48.3 million in the second quarter of 2020. Additionally, the Company is also raising financial guidance provided for the quarter ending September 30, 2021 and the year ending December 31, 2021 it had previously issued in the press release announcing its financial results for the quarter ended June 30, 2021.
| Updated guidance for Q3 2021 | Previous guidance for Q3 2021 | Updated guidance for 2021 | Previous guidance for 2021 | |||||
| Revenue |
$75.0 to $77.0 million | $74.0 to $76.0 million | $309.0 to $313.0 million | $308.0 to $312.0 million | ||||
| Adjusted EBITDA |
$18.0 to $20.0 million | $16.0 to $18.0 million | $89.0 to $93.0 million | $87.0 to $91.0 million |
The increased outlook for the third quarter of 2021 reflects a strong contribution across all segments driven by the adoption of Context Control solutions in programmatic, expansion in international markets, as well as growth in connected TV (CTV) due to Publica acquired in August 2021.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| INTEGRAL AD SCIENCE HOLDING CORP. | ||||||
| Date: September 17, 2021 | By: | /s/ Joseph Pergola | ||||
| Name: | Joseph Pergola | |||||
| Title: | Chief Financial Officer | |||||