Veritone, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Consolidated Financial Statements Details

Consolidated Financial Statements Details

12 Months Ended

Dec. 31, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Consolidated Financial Statements Details

NOTE 8. CONSOLIDATED FINANCIAL STATEMENTS DETAILS

Consolidated Balance Sheets Details

Cash and cash equivalents

As of December 31, 2023 and December 31, 2022, the Company had cash and cash equivalents of $79,439 and $184,423, respectively, including $21,179 and $93,118, respectively, of cash received from advertising customers for future payments to vendors.

Accounts Receivable, Net and Allowance for Credit Losses

Accounts receivable consisted of the following:


	As of
	December 31, 2023			December 31, 2022
Accounts receivable — Managed Services(1)	$	38,477		$	27,670
Accounts receivable — Software Products & Services(2)		26,246			26,969
Accounts receivable — Other		5,723			2,181
		70,446			56,820
Less: allowance for expected credit losses		(1,180	)		(819	)
Accounts receivable, net	$	69,266		$	56,001

(1)

Accounts receivable – Managed Services reflects the amounts due from the Company’s advertising customers.

(2)

Accounts receivable – Software Products & Services reflects the amounts due from the Company’s Veritone Hire solutions customers.

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following:


	As of
	December 31, 2023		December 31, 2022
Prepaid assets	$	5,538	$	5,465
Other receivables		1,805		1,631
Other current assets		7,114		8,146
Prepaid expenses and other current assets	$	14,457	$	15,242

Property, Equipment and Improvements, Net

Property, equipment and improvements, net consisted of the following:


	As of
	December 31, 2023			December 31, 2022
Property and equipment	$	6,796		$	5,375
Internal use software development costs placed in service		8,226			3,157
Leasehold improvements		1,639			250
		16,661			8,782
Less: accumulated depreciation		(8,005	)		(3,491	)
Property, equipment and improvements, net	$	8,656		$	5,291

Depreciation expense was $2,387 and $1,312 for the years ended December 31, 2023 and 2022, respectively. Of the $6,796 in property and equipment as of December 31, 2023, $1,691 consisted of work in progress not yet placed in service for internal use software development costs. Depreciation of internal use software development costs was $1,878 and $418 for the years ended December 31, 2023 and 2022, respectively.

The Company’s property and equipment, net, are primarily located in the U.S. Property in the UK makes up 17% of total property and equipment, net as of December 31, 2023. No other country accounted for more than 10% of total property and equipment, net as of December 2022.

Accounts Payable

Accounts payable consisted of the following:


	As of
	December 31, 2023		December 31, 2022
Accounts payable — Managed Services(1)	$	11,797	$	17,972
Accounts payable — Other		20,959		18,766
Accounts payable	$	32,756	$	36,738

(1)

Accounts payable – Managed Services reflects the amounts due to media vendors for advertisements placed on behalf of the Company’s advertising clients.

Other Accrued Liabilities

Other accrued liabilities consisted of the following:


	As of
	December 31, 2023		December 31, 2022
Accrued compensation	$	4,615	$	4,882
Taxes payable		5,425		4,774
Current portion of operating lease liabilities		2,348		2,112
Accrued trade payables		13,749		14,724
Other		958		920
Other accrued liabilities	$	27,095	$	27,412

Contract Liabilities

Our contract liabilities consist of deferred revenue. Deferred revenue represents billings under non-cancelable contracts before the related product or service is transferred to the customer. The portion of deferred revenue that is anticipated to be recognized as revenue during the succeeding twelve-month period is recorded as deferred revenue within the Company's consolidated balance sheets. Deferred revenue was comprised of the following:


	Year Ended December 31,
	2023
Deferred revenue additions from acquisition	$	10,002
Less: revenue recognized		8,166
Additions to deferred revenue		8,436
Ending balance of deferred revenue	$	10,272

Consolidated Statements of Operations and Comprehensive Loss Details

Revenue

Revenue for the periods presented were comprised of the following:


	Year Ended December 31,
	2023		2022
Commercial Enterprise	$	121,569	$	145,899
Government & Regulated Industries		5,991		3,829
Total revenue	$	127,560	$	149,728

The Company serves two customer groups: (1) Commercial Enterprise, which today consists of customers in the commercial sector, including media and entertainment customers, advertising customers, content licensing customers and Veritone Hire solutions customers (inclusive of Broadbean customers); and (2) Government & Regulated Industries, which consists of customers in the government and regulated industries sectors, including state, local and federal government, legal, and compliance customers.

Software Products & Services consists of revenue generated from the Company’s aiWARE platform and Veritone Hire solutions’ talent acquisition solutions (inclusive of Broadbean), any related support and maintenance services, and any related professional services associated with the deployment and / or implementation of such solutions.

Managed Services consists of revenues generated from content licensing customers and advertising agency customers and related services.

The table below illustrates the presentation of our revenues based on the above definitions:


	Year Ended December 31, 2023						Year Ended December 31, 2022
			Government &						Government &
	Commercial		Regulated				Commercial		Regulated
	Enterprise		Industries		Total		Enterprise		Industries		Total
Total Software Products & Services	$	62,410	$	5,991	$	68,401	$	80,749	$	3,829	$	84,578

Managed Services
Advertising		38,821		—		38,821		44,665		—		44,665
Licensing		20,338		—		20,338		20,485		—		20,485
Total Managed Services		59,159		—		59,159		65,150		—		65,150

Total Revenue	$	121,569	$	5,991	$	127,560	$	145,899	$	3,829	$	149,728

In the year ended December 31, 2022, substantially all of our revenue was derived from customers located in the U.S. With the June 2023 acquisition of Broadbean, we expanded our customer base throughout Europe and Asia Pacific. In 2023, 13% of our consolidated revenue was from customers outside of the U.S., as compared to less than 10% in 2022.

Other Income (Expense), Net

Other income (expense), net for the periods presented was comprised of the following:


	Year Ended December 31,
	2023			2022
Interest expense, net	$	(2,447	)	$	(4,862	)
Gain on sale of energy group		2,572			—
Other		515			512
Other income (expense), net	$	640		$	(4,350	)