pubm-20220331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022
or

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from________to________

Commission File Number: 001-39748

PUBMATIC, INC.

(Exact name of registrant as specified in its charter)


Delaware			20-5863224
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification Number)

Not applicable			Not applicable
(Address of principal executive offices)			(Zip Code)

Not applicable
(Registrant’s telephone number, including area code)

Not applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol	Name of each exchange on which registered
Class A common stock, $0.0001 par value per share	PUBM	The Nasdaq Global Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided to Section 7(a)(2)(B) of the Securities Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

As of May 3, 2022, the registrant had 42,178,200 shares of Class A common stock outstanding and 9,875,297 shares of Class B common stock outstanding.

Table of Contents

TABLE OF CONTENTS


		Page
	PART I - FINANCIAL INFORMATION
Item 1.	Condensed Consolidated Financial Statements (Unaudited)	1
	Condensed Consolidated Balance Sheets	1
	Condensed Consolidated Statements of Operations	2
	Condensed Consolidated Statements of Comprehensive Income	3
	Condensed Consolidated Statements of Stockholders’ Equity	4
	Condensed Consolidated Statements of Cash Flows	5
	Notes to Condensed Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	18
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	31
Item 4.	Controls and Procedures	31

	PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	33
Item 1A.	Risk Factors	33
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	59
Item 3.	Defaults Upon Senior Securities	60
Item 4.	Mine Safety Disclosures	60
Item 5.	Other Information	60
Item 6.	Exhibits	61
Signatures		62

Table of Contents

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

PUBMATIC, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except par values and share data)

(Unaudited)


	March 31, 2022		December 31, 2021

ASSETS
Current Assets
Cash and cash equivalents	$	74,467	$	82,505
Marketable securities	100,258		77,121
Accounts receivable - net	218,359		286,916
Prepaid expenses and other current assets	11,790		14,207
Total Current Assets	404,874		460,749
Property, equipment and software - net	46,790		50,140
Operating lease right-of-use assets	24,973		21,613
Goodwill	6,250		6,250
Deferred income tax asset	2,155		515
Other assets, non-current	12,567		10,948
TOTAL ASSETS	$	497,609	$	550,215
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable	$	186,012	$	244,321
Accrued liabilities	10,676		18,780
Operating lease liabilities, current	3,869		3,864
Total Current Liabilities	200,557		266,965
Operating lease liabilities, non-current	21,293		17,842
Deferred tax liability	6,067		6,067
Other liabilities, non-current	1,986		2,161
TOTAL LIABILITIES	229,903		293,035
Commitments and contingencies (Note 7)
Stockholders' Equity
Preferred stock, $0.0001 par value per share, 10,000,000 shares authorized as of March 31, 2022 and December 31, 2021; No shares issued and outstanding as of March 31, 2022 and December 31, 2021	—		—
Common stock, par value $0.0001 per share; 1,000,000,000 Class A shares authorized as of March 31, 2022 and December 31, 2021; 41,014,591 and 40,695,140 shares issued and outstanding as of March 31, 2022 and December 31, 2021, respectively; 1,000,000,000 Class B shares authorized as of March 31, 2022 and December 31, 2021; 10,996,149 and 11,159,609 shares issued and outstanding as of March 31, 2022 and December 31, 2021, respectively.	6		6
Treasury stock, at cost - 3,140,437 as of March 31, 2022 and December 31, 2021, respectively.	(11,486)		(11,486)
Additional paid-in capital	175,351		169,401
Accumulated other comprehensive loss	(239)		(36)
Retained earnings	104,074		99,295
TOTAL STOCKHOLDERS’ EQUITY	267,706		257,180
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	497,609	$	550,215

The accompanying notes are an integral part of these condensed consolidated financial statements.

Table of Contents

PUBMATIC, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except share and per share data)

(Unaudited)


	Three Months Ended March 31,
	2022		2021

Revenue	$	54,552	$	43,608
Cost of revenue	17,992		12,300
Gross profit	36,560		31,308
Operating expenses:
Technology and development	4,773		3,738
Sales and marketing	16,456		12,789
General and administration	10,750		8,139
Total operating expenses	31,979		24,666
Operating income	4,581		6,642
Total other income (expense), net	1,601		199
Income before income taxes	6,182		6,841
Provision for income taxes	1,403		1,923
Net income	$	4,779	$	4,918
Net income per share attributable to common stockholders:
Basic	$	0.09	$	0.10
Diluted	$	0.08	$	0.09

Weighted-average shares used to compute net income per share attributable to common stockholders:
Basic	51,910,572		49,109,237
Diluted	56,888,179		56,784,558

The accompanying notes are an integral part of these condensed consolidated financial statements.

Table of Contents

PUBMATIC, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

(Unaudited)


	Three Months Ended March 31,
	2022		2021

Net income	$	4,779	$	4,918
Other comprehensive loss:
Unrealized loss on marketable securities, net of tax	(203)		(1)
Comprehensive income

SEC Form 10-Q filed by PubMatic Inc.