pubm-20210331

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, 2021
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)

3 Lagoon Drive, Suite 180
Redwood City, California 94065

(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 o 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 April 30, 2021, the registrant had 8,967,003 shares of Class A common stock outstanding and 40,399,914 shares of Class B common stock outstanding.

Table of Contents

TABLE OF CONTENTS


		Page
	PART I - FINANCIAL INFORMATION
Item 1.	Condensed 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	19
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	31
Item 4.	Controls and Procedures	32

	PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	34
Item 1A.	Risk Factors	34
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	68
Item 3.	Defaults Upon Senior Securities	68
Item 4.	Mine Safety Disclosures	68
Item 5.	Other Information	68
Item 6.	Exhibits	69
Signatures		70

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, 2021		December 31, 2020

ASSETS
Current Assets
Cash and cash equivalents	$	76,646	$	81,188
Marketable securities	33,371		19,793
Accounts receivable - net	173,071		219,511
Prepaid expenses and other current assets	8,018		6,622
Total Current Assets	291,106		327,114
Property, equipment and software - net	33,958		30,044
Goodwill	6,250		6,250
Deferred income tax asset	498		762
Other assets, non-current	1,658		7,076
TOTAL ASSETS	$	333,470	$	371,246
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable	$	136,003	$	176,731
Accrued liabilities	9,250		14,844
Total Current Liabilities	145,253		191,575
Deferred tax liability	1,577		1,561
Other liabilities, non-current	2,554		2,683
TOTAL LIABILITIES	149,384		195,819
Commitments and contingencies (Note 6)
Stockholders' Equity
Preferred stock, $0.0001 par value per share, 10,000,000 and no shares authorized as of March 31, 2021 and December 31, 2020, respectively; No shares issued and outstanding as of March 31, 2021 and December 31, 2020	—		—
Common stock, par value $0.0001 per share; 1,000,000,000 Class A shares authorized as of March 31, 2021 and December 31, 2020; 7,057,405 and 6,801,368 shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively; 1,000,000,000 Class B shares authorized as of March 31, 2021 and December 31, 2020; 42,208,456 and 42,186,774 shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively.	6		6
Treasury stock, at cost - 3,139,988 and 3,139,295 shares as of March 31, 2021 and December 31, 2020, respectively.	(11,461)		(11,434)
Additional paid-in capital	147,932		144,163
Accumulated other comprehensive income	—		1
Retained earnings	47,609		42,691
Total Stockholders' Equity	184,086		175,427
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	333,470	$	371,246

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,
	2021		2020

Revenue	$	43,608	$	28,348
Cost of revenue	12,300		10,056
Gross profit	31,308		18,292

Operating expenses:
Technology and development	3,738		2,919
Sales and marketing	12,789		9,995
General and administration	8,139		4,349
Total operating expenses	24,666		17,263
Operating income	6,642		1,029
Interest income	62		260
Other income (expense), net	137		14
Total other income (expense), net	199		274
Income before provision for income taxes	6,841		1,303
Provision for income taxes	1,923		399
Net income	$	4,918	$	904
Net income per share attributable to common stockholders:
Basic	$	0.10	$	—
Diluted	$	0.09	$	—

Weighted-average shares used to compute net income per share attributable to common stockholders:
Basic	49,109,237		10,092,152
Diluted	56,784,558		13,473,917

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,
	2021		2020

Net income	$	4,918	$	904

SEC Form 10-Q filed by PubMatic, Inc.