8-K
false000183867200018386722023-11-072023-11-070001838672us-gaap:CommonStockMember2023-11-072023-11-070001838672us-gaap:WarrantMember2023-11-072023-11-07

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 7, 2023

 

 

AdTheorent Holding Company, Inc.

(Exact name of Registrant as Specified in Its Charter)

 

 

Delaware

001-40116

85-3978415

(State or Other Jurisdiction
of Incorporation)

(Commission File Number)

(IRS Employer
Identification No.)

 

 

 

 

 

330 Hudson Street

13th Floor

 

New York, New York

 

10013

(Address of Principal Executive Offices)

 

(Zip Code)

 

Registrant’s Telephone Number, Including Area Code: (800) 804-1359

 

 

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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


Title of each class

 

Trading
Symbol(s)

 


Name of each exchange on which registered

Common stock, par value $0.0001 per share

 

ADTH

 

The Nasdaq Stock Market

Warrants to purchase common stock

 

ADTHW

 

The Nasdaq Stock Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

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 pursuant to Section 13(a) of the Exchange Act.

 

 

 


Item 2.02 Results of Operations and Financial Condition.

On November 7, 2023, AdTheorent Holding Company, Inc. (the “Company”) released its financial results for the quarter ended September 30, 2023. A copy of the Company’s press release is attached as Exhibit 99.1 to this Form 8-K and incorporated herein by reference.

Item 7.01 Regulation FD Disclosure.

On November 7, 2023, a presentation entitled “AdTheorent Investor Presentation” was made available on the Investors page of the Company’s website at https://investors.adtheorent.com/. A copy of the Company’s presentation is attached as Exhibit 99.2 to this Form 8-K and incorporated herein by reference.

The information provided in Items 2.02 and 7.01 in this report shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits.

d) Exhibits.

Exhibit No.

 

Description

 

 

 

99.1

 

Press release issued by AdTheorent Holding Company, Inc., dated November 7, 2023.

99.2

 

Investor Presentation, dated November 7, 2023.

104

 

Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Comments in this Current Report on Form 8-K and in the exhibit attached hereto contain certain forward-looking statements, which are based on management’s good faith expectations and beliefs concerning future developments. Actual results may differ materially from these expectations as a result of many factors. These factors include, but are not limited to, the risks and uncertainties described in the “Risk Factors” and “Cautionary Statement Regarding Forward Looking Statements” sections of the Company’s Annual Report on Form 10-K, as well as in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s Quarterly Reports on Form 10-Q. The Company does not undertake any obligation to update such forward-looking statements. All market and industry data are based on Company estimates.

 


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 thereunto duly authorized.

 

 

 

AdTheorent Holding Company, Inc.

 

 

 

 

Date:

November 7, 2023

By:

/s/ James Lawson

 

 

 

James Lawson
Chief Executive Officer

 


EX-99.1

 

Exhibit 99.1

 

AdTheorent Holding Company, Inc. Reports Third Quarter 2023 Financial Results

Revenue Grows 8.8% Year-over-Year; Adjusted EBITDA Above High End of Outlook

 

 

New York, NY November 7, 2023 AdTheorent Holding Company, Inc. (Nasdaq: ADTH) (“AdTheorent” or “the Company”), a machine learning pioneer and industry leader using privacy-forward solutions to deliver measurable value for programmatic advertisers, today announced its third quarter 2023 financial results.

Third Quarter 2023 Financial Overview:

Revenue was $40.9 million, an 8.8% increase compared to $37.6 million in the third quarter of 2022.
Gross profit was $18.9 million, up 4.8%, from $18.0 million in the third quarter of 2022. Gross Profit Margin was 46.2%, compared to 47.9% in the third quarter of 2022.
Adjusted Gross Profit* increased $1.6 million, or 6.7%, to $26.4 million compared to the third quarter of 2022. Adjusted Gross Profit Margin was 64.5% compared to 65.8% in the third quarter of 2022.
Net loss was $4.2 million compared to net income of $5.7 million in the third quarter of 2022. In the third quarter of 2023, the Company recognized a total of $1.5 million of mark to market gains related to fair value of the Seller's Earn-Out and Warrants liabilities compared to gains of $8.6 million in the third quarter of 2022.
Adjusted EBITDA* increased $1.1 million, or 32.0%, to $4.7 million compared to third quarter 2022. Adjusted EBITDA as a percentage of Adjusted Gross Profit of 17.9% represented an increase from 14.5% in the third quarter of 2022.

 

“We made tangible progress in the third quarter and are encouraged by our return to growth. Results were particularly robust in areas of investment, including self-service, AdTheorent Health, and our algorithm-based Predictive Audience solutions, all of which saw exceptional growth during the quarter, as customers responded enthusiastically to our differentiated offerings,” said James Lawson, CEO of AdTheorent. “We expect this momentum to continue, we remain on track to meet or exceed our full-year projections for 2023, and we are looking ahead to 2024 with optimism.”

Third Quarter and Recent Business and Operating Highlights:

The third quarter was the most active quarter to date for AdTheorent’s self-service adoption with a 28% sequential increase in self-service platform revenue and 57% sequential increase in advertiser count.
AdTheorent Health momentum accelerated, with 28% year-over-year revenue growth and a 51% sequential increase in advertiser count in the third quarter of 2023; adoption of AdTheorent Health Audiences gained momentum, with 36 active campaigns in the third quarter, up 89% compared to the second quarter.
AdTheorent’s algorithm-based and ID-independent predictive audiences continued to yield strong customer adoption with 66 active campaigns in the third quarter.
AdTheorent formed a strategic partnership with Hero Media that establishes the first Black-owned demand-side platform (“DSP”) in programmatic advertising, Hero One, combining AdTheorent’s award-winning platform and technology with Hero Media’s media network, exclusive properties, and unique data and insights, allowing platform users to reach diverse audiences at scale.

 


 

AdTheorent Health Audiences received Neutronian's Quality Index (“NQI”) Certification based on AdTheorent’s superior capabilities in areas including: consent and compliance, data quality and sourcing transparency, privacy and performance.
AdTheorent received prestigious industry recognition in third quarter including:
AdTheorent was named “Best Buy-Side Programmatic Platform” in the Digiday Technology Awards.
AdTheorent Health won a “Programmatic Marketing Innovation Award” in the MarTech Breakthrough Awards.
AdTheorent was named a 2023 Crain’s Best Places to Work in New York City, marking the Company’s 10th consecutive year receiving this recognition.

*We prepare our consolidated financial statements in accordance with the U.S. generally accepted accounting principles (“GAAP”). Adjusted Gross Profit and Adjusted EBITDA are non-GAAP financial measures. See the supplementary schedules in this press release for a discussion of how we define and calculate these measures and a reconciliation thereof to the most directly comparable GAAP measures.

Fourth Quarter and Full-Year 2023 Financial Outlook:

The Company's growth may continue to be impacted in the remainder of 2023 by macroeconomic factors beyond its control, such as inflationary pressures and recessionary fears. Based on the current business environment, recent performance and the current trends in the marketplace and subject to the risks and uncertainties inherent in forward-looking statements, the Company's outlook for the fourth quarter and full-year 2023 includes the following:

 

Fourth quarter 2023:

Revenue in the range of $55.0 million to $57.0 million.
Adjusted Gross Profit* of at least 64% of revenue.
Adjusted EBITDA* in the range of $10.0 million to $11.5 million.

Full-year ending December 31, 2023:

Revenue growth compared to 2022.
Adjusted Gross Profit* between 64% to 65% of revenue.
Adjusted EBITDA* margin of between 16% and 19%.

 

Although the Company provides guidance for Adjusted EBITDA, it is not able to provide guidance for net income, the most directly comparable GAAP measure. Certain elements of the composition of net income, including equity-based compensation, are not predictable, making it impractical for the Company to provide guidance on net income or to reconcile its Adjusted EBITDA guidance to net income without unreasonable efforts. Similarly, although the Company provides guidance for Adjusted Gross Profit, it is not able to provide guidance for Gross Profit, the most directly comparable GAAP measure. Certain elements of the composition of Gross Profit, including equity-based compensation, are not predictable, making it impractical for the Company to provide guidance on Gross Profit or to reconcile its Adjusted Gross Profit guidance to Gross Profit without unreasonable efforts. For the same reasons, the Company is unable to address the probable significance of the unavailable information regarding net income and Gross Profit, which could be material to future results.

About AdTheorent:

AdTheorent uses advanced machine learning technology and privacy-forward solutions to deliver impactful advertising campaigns for marketers. AdTheorent's advanced machine learning-powered media buying platform powers its predictive targeting, predictive audiences, geo-intelligence, audience extension solutions and in-house creative capability, Studio A\T. Leveraging only non-sensitive data and focused on the predictive value of machine learning models, AdTheorent's product suite and flexible transaction models allow advertisers to identify the most qualified potential consumers coupled with the optimal creative experience to deliver superior results, measured by each advertiser's real-world business goals. AdTheorent is headquartered in New York, with fourteen locations across the United States and Canada.

 


 

AdTheorent is consistently recognized with numerous technology, product, growth and workplace awards. AdTheorent was named “Best Buy-Side Programmatic Platform” in the 2023 Digiday Technology Awards and was honored with an AI Breakthrough Award and “Most Innovative Product” (B.I.G. Innovation Awards) for six consecutive years.Additionally, AdTheorent is the only seven-time recipient of Frost & Sullivan's “Digital Advertising Leadership Award.” In September 2023, evidencing its continued prioritization of its team, AdTheorent was named a Crain’s Top 100 Best Place to Work in NYC for the tenth consecutive year. AdTheorent ranked tenth in the Large Employer Category and 26th Overall in 2023. For more information, visit adtheorent.com.

Conference Call and Webcast Details:

AdTheorent will host a conference call and webcast at 4:30 p.m. ET today, November 7, 2023, to discuss its third quarter 2023 financial results and business highlights. The conference call can be accessed by dialing (800) 715-9871 from the United States and Canada or (646) 307-1963 International with Conference ID 7894988. The live webcast of the conference call and other materials related to AdTheorent’s financial performance can be accessed from AdTheorent’s investor relations website at investors.adtheorent.com.

Following the completion of the call until 11:59 p.m. ET on Tuesday, November 14, 2023, a telephone replay will be available by dialing (800) 770-2030 from the United States and Canada, or (609) 800-9909 International with Conference ID 7894988. A webcast replay will also be available at investors.adtheorent.com for 12 months.

 

Forward-Looking Statements:

This communication contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain words such as “believe,” “anticipate,” “expect,” “estimate,” “intend,” “project,” “plan,” or words or phrases with similar meaning. Forward-looking statements should not be read as a guarantee of future performance or results and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved. Forward-looking statements contained in this press release relate to, among other things, the Company’s projected financial performance and operating results, including projected revenue, Adjusted Gross Profit and Adjusted EBITDA, as well as statements regarding inflationary pressures and recessionary fears.

 

Forward-looking statements are based on current expectations, forecasts and assumptions that involve risks and uncertainties, including, but not limited to, the market for programmatic advertising developing slower or differently than the Company’s expectations, the demands and expectations of clients and the ability to attract and retain clients and other economic, competitive, governmental and technological factors outside of the Company's control, that may cause the Company's business, strategy or actual results to differ materially from the forward-looking statements. The Company does not intend and undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable law. Investors are referred to AdTheorent's filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K and any subsequent filings on Forms 10-Q or 8-K, for additional information regarding the risks and uncertainties that may cause actual results to differ materially from those expressed in any forward-looking statement.

 

Investor Contact:

David DeStefano, ICR

AdTheorentIR@icrinc.com

(203) 682-8383

 

Press Contact:

Melanie Berger, AdTheorent

Press@adtheorent.com

(850) 567-0082

 

 

 

 


 

 

ADTHEORENT HOLDING COMPANY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited; in thousands)

 

 

 

September 30,

 

 

December 31,

 

 

 

2023

 

 

2022

 

ASSETS

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

Cash and cash equivalents

 

$

74,339

 

 

$

72,579

 

Accounts receivable, net

 

 

48,693

 

 

 

56,027

 

Income tax recoverable

 

 

177

 

 

 

145

 

Prepaid expenses

 

 

2,673

 

 

 

1,466

 

Total current assets

 

 

125,882

 

 

 

130,217

 

Property and equipment, net

 

 

465

 

 

 

520

 

Operating lease right of use assets

 

 

4,987

 

 

 

5,732

 

Investment in SymetryML Holdings

 

 

636

 

 

 

789

 

Customer relationships, net

 

 

1,119

 

 

 

4,475

 

Other intangible assets, net

 

 

7,854

 

 

 

6,708

 

Goodwill

 

 

34,842

 

 

 

34,842

 

Deferred income taxes, net

 

 

12,067

 

 

 

6,962

 

Other assets

 

 

308

 

 

 

359

 

Total assets

 

$

188,160

 

 

$

190,604

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

Accounts payable

 

$

10,294

 

 

$

9,479

 

Accrued compensation

 

 

5,117

 

 

 

8,939

 

Accrued expenses

 

 

5,076

 

 

 

6,224

 

Operating lease liabilities, current

 

 

1,265

 

 

 

1,265

 

Total current liabilities

 

 

21,752

 

 

 

25,907

 

Warrants

 

 

862

 

 

 

2,298

 

Seller's Earn-Out

 

 

23

 

 

 

773

 

Operating lease liabilities, non-current

 

 

5,253

 

 

 

6,201

 

Total liabilities

 

 

27,890

 

 

 

35,179

 

Stockholders’ equity

 

 

 

 

 

 

Preferred Stock

 

 

 

 

 

 

Common Stock

 

 

9

 

 

 

9

 

Additional paid-in capital

 

 

89,746

 

 

 

83,566

 

Retained earnings

 

 

70,515

 

 

 

71,850

 

Total stockholders' equity

 

 

160,270

 

 

 

155,425

 

Total liabilities and stockholders’ equity

 

$

188,160

 

 

$

190,604

 

 

 

 

 

 


 

 

 

ADTHEORENT HOLDING COMPANY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited; in thousands, except share and per share data)

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Revenue

 

$

40,890

 

 

$

37,584

 

 

$

111,151

 

 

$

114,301

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Platform operations

 

 

22,019

 

 

 

19,581

 

 

 

61,141

 

 

 

58,207

 

Sales and marketing

 

 

11,119

 

 

 

11,127

 

 

 

32,050

 

 

 

32,540

 

Technology and development

 

 

3,794

 

 

 

3,955

 

 

 

10,453

 

 

 

12,393

 

General and administrative

 

 

4,113

 

 

 

4,729

 

 

 

11,638

 

 

 

15,433

 

Total operating expenses

 

 

41,045

 

 

 

39,392

 

 

 

115,282

 

 

 

118,573

 

Loss from operations

 

 

(155

)

 

 

(1,808

)

 

 

(4,131

)

 

 

(4,272

)

Interest income (expense), net

 

 

707

 

 

 

97

 

 

 

1,750

 

 

 

(59

)

Gain on change in fair value of Seller's Earn-Out

 

 

225

 

 

 

2,901

 

 

 

750

 

 

 

15,664

 

Gain on change in fair value of warrants

 

 

1,290

 

 

 

5,674

 

 

 

1,436

 

 

 

8,261

 

Gain on deconsolidation of SymetryML

 

 

 

 

 

 

 

 

 

 

 

1,939

 

Loss on change in fair value of SAFE Notes

 

 

 

 

 

 

 

 

 

 

 

(788

)

Gain (loss) on fair value of investment in SymetryML Holdings

 

 

5

 

 

 

(39

)

 

 

(153

)

 

 

(49

)

Other expense, net

 

 

(12

)

 

 

(5

)

 

 

(49

)

 

 

(24

)

Total other income, net

 

 

2,215

 

 

 

8,628

 

 

 

3,734

 

 

 

24,944

 

Net income (loss) before income taxes

 

 

2,060

 

 

 

6,820

 

 

 

(397

)

 

 

20,672

 

(Provision) benefit for income taxes

 

 

(6,254

)

 

 

(1,095

)

 

 

(938

)

 

 

540

 

Net (loss) income

 

$

(4,194

)

 

$

5,725

 

 

$

(1,335

)

 

$

21,212

 

Less: Net loss attributable to noncontrolling interest

 

 

 

 

 

 

 

 

 

 

 

550

 

Net (loss) income attributable to AdTheorent Holding Company, Inc.

 

$

(4,194

)

 

$

5,725

 

 

$

(1,335

)

 

$

21,762

 

(Loss) earnings per share:

 

 

 

 

 

 

 

 

 

 

 

     Basic

 

$

(0.05

)

 

$

0.07

 

 

$

(0.02

)

 

$

0.25

 

     Diluted

 

$

(0.05

)

 

$

0.06

 

 

$

(0.02

)

 

$

0.23

 

Weighted-average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

     Basic

 

 

88,175,813

 

 

 

86,492,025

 

 

 

87,869,345

 

 

 

86,003,514

 

     Diluted

 

 

88,175,813

 

 

 

92,122,421

 

 

 

87,869,345

 

 

 

92,885,851

 

 

 

 

 

 


 

 

ADTHEORENT HOLDING COMPANY, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited; in thousands)

 

 

 

Nine Months Ended September 30,

 

 

 

2023

 

 

2022

 

Cash flows from operating activities

 

 

 

 

 

 

Net (loss) income

 

$

(1,335

)

 

$

21,212

 

Adjustments to reconcile net (loss) income to net cash provided by operating activities:

 

 

 

 

 

 

Provision for credit losses

 

 

10

 

 

 

240

 

Amortization expense

 

 

6,473

 

 

 

5,872

 

Depreciation expense

 

 

146

 

 

 

143

 

Amortization of debt issuance costs

 

 

42

 

 

 

42

 

Gain on change in fair value of Seller's Earn-Out

 

 

(750

)

 

 

(15,664

)

Gain on change in fair value of warrants

 

 

(1,436

)

 

 

(8,261

)

Gain on deconsolidation of SymetryML

 

 

 

 

 

(1,939

)

Loss on change in fair value of SAFE Notes

 

 

 

 

 

788

 

Loss on fair value of investment in SymetryML Holdings

 

 

153

 

 

 

49

 

Deferred tax benefit

 

 

(5,105

)

 

 

(5,455

)

Equity-based compensation

 

 

5,924

 

 

 

8,627

 

Seller's Earn-Out equity-based compensation

 

 

 

 

 

1,364

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

Accounts receivable

 

 

7,324

 

 

 

13,103

 

Income taxes recoverable

 

 

(32

)

 

 

(4

)

Prepaid expenses and other assets

 

 

(453

)

 

 

337

 

Accounts payable

 

 

775

 

 

 

(3,911

)

Accrued compensation, accrued expenses, and other liabilities

 

 

(5,918

)

 

 

(8,104

)

Net cash provided by operating activities

 

 

5,818

 

 

 

8,439

 

Cash flows from investing activities

 

 

 

 

 

 

Capitalized software development costs

 

 

(3,969

)

 

 

(2,008

)

Purchase of property and equipment

 

 

(88

)

 

 

(311

)

Decrease in cash from deconsolidation of SymetryML

 

 

 

 

 

(69

)

Net cash used in investing activities

 

 

(4,057

)

 

 

(2,388

)

Cash flows from financing activities

 

 

 

 

 

 

Cash received for exercised options

 

 

150

 

 

 

346

 

Payment of revolver borrowings

 

 

 

 

 

(39,017

)

Proceeds from SAFE Notes

 

 

 

 

 

200

 

Proceeds from SymetryML preferred stock issuance

 

 

 

 

 

400

 

Taxes paid related to net settlement of restricted stock awards

 

 

(466

)

 

 

(231

)

Proceeds from employee stock purchase plan

 

 

315

 

 

 

 

Net cash used in financing activities

 

 

(1

)

 

 

(38,302

)

Net increase (decrease) in cash and cash equivalents

 

 

1,760

 

 

 

(32,251

)

Cash and cash equivalents at beginning of period

 

 

72,579

 

 

 

100,093

 

Cash and cash equivalents at end of period

 

$

74,339

 

 

$

67,842

 

 

 

 


 

 

 

 

Non-GAAP Financial Measures

 

The Company uses financial measures that are not calculated in accordance with GAAP including Adjusted EBITDA and Adjusted Gross Profit. The Company's management believes that this information can assist investors in evaluating the Company's operational trends, financial performance, and cash generating capacity and make strategic decisions. Management believes these non-GAAP measures allow investors to evaluate the Company’s financial performance using some of the same measures as management.

 

Because of the limitations associated with these non-GAAP financial measures, “Adjusted Gross Profit,” “EBITDA,” “Adjusted EBITDA,” “Adjusted Gross Profit as a percentage of Revenue” and “Adjusted EBITDA as a percent of Adjusted Gross Profit” should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP. The Company compensates for these limitations by relying primarily on its GAAP results and using non-GAAP measures on a supplemental basis. You should review the reconciliation of the non-GAAP financial measures below and not rely on any single financial measure to evaluate AdTheorent's business.

The tables below show the Company’s non-GAAP financial metrics reconciled to the comparable GAAP financial metrics included in this release.

Adjusted Gross Profit

Adjusted Gross Profit is a non-GAAP profitability measure. Adjusted Gross Profit is a non-GAAP financial measure of campaign profitability, monitored by management and the board, used to evaluate the Company's operating performance and trends, develop short- and long-term operational plans, and make strategic decisions regarding the allocation of capital. The Company believes this measure provides a useful period-to-period comparison of campaign profitability and is useful information to investors and the market in understanding and evaluating its operating results in the same manner as its management and board. Gross profit is the most comparable GAAP measurement, which is calculated as revenue less platform operations costs. In calculating Adjusted Gross Profit, the Company adds back other platform operations costs, which consist of amortization expense related to capitalized software, depreciation expense, allocated costs of personnel which set up and monitor campaign performance, and platform hosting, license, and maintenance costs, to gross profit.

The following table sets forth a reconciliation of revenue to Adjusted Gross Profit for the periods presented:

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

 

(In thousands)

 

Revenue

 

$

40,890

 

 

$

37,584

 

 

$

111,151

 

 

$

114,301

 

Less: Platform operations

 

 

22,019

 

 

 

19,581

 

 

 

61,141

 

 

 

58,207

 

Gross Profit

 

 

18,871

 

 

 

18,003

 

 

 

50,010

 

 

 

56,094

 

Add back: Other platform operations

 

 

7,519

 

 

 

6,739

 

 

 

21,319

 

 

 

19,979

 

Adjusted Gross Profit

 

$

26,390

 

 

$

24,742

 

 

$

71,329

 

 

$

76,073

 

EBITDA and Adjusted EBITDA

EBITDA is a non-GAAP financial measure defined by us as net (loss) income, before interest (income) expense, net; depreciation, amortization; and income tax provision (benefit). Adjusted EBITDA is defined as EBITDA before equity-based compensation expense, transaction costs, non-core operations and other non-recurring items. Net (loss) income is the most comparable GAAP measurement.

 


 

Collectively these non-GAAP financial measures are key profitability measures used by the Company's management and board to understand and evaluate its operating performance and trends, develop short-and long-term operational plans and make strategic decisions regarding the allocation of capital. The Company believes that these measures can provide useful period-to-period comparisons of campaign profitability. Accordingly, the Company believes that these measures provide useful information to investors and the market in understanding and evaluating its operating results in the same manner as its management and board.

The following table sets forth a reconciliation of net (loss) income to Adjusted EBITDA for the periods presented:

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

 

(In thousands)

 

Net (loss) income

 

$

(4,194

)

 

$

5,725

 

 

$

(1,335

)

 

$

21,212

 

Interest (income) expense, net

 

 

(707

)

 

 

(97

)

 

 

(1,750

)

 

 

59

 

Tax provision (benefit)

 

 

6,254

 

 

 

1,095

 

 

 

938

 

 

 

(540

)

Depreciation and amortization

 

 

2,317

 

 

 

1,973

 

 

 

6,619

 

 

 

6,015

 

EBITDA

 

$

3,670

 

 

$

8,696

 

 

$

4,472

 

 

$

26,746

 

Equity-based compensation

 

 

2,584

 

 

 

2,783

 

 

 

5,924

 

 

 

8,627

 

Seller's Earn-Out equity-based compensation

 

 

 

 

 

373

 

 

 

 

 

 

1,364

 

Transaction costs (1)

 

 

 

 

 

 

 

 

166

 

 

 

(131

)

Gain on change in fair value of Seller's Earn-Out (2)

 

 

(225

)

 

 

(2,901

)

 

 

(750

)

 

 

(15,664

)

Gain on change in fair value of warrants (3)

 

 

(1,290

)

 

 

(5,674

)

 

 

(1,436

)

 

 

(8,261

)

Gain on deconsolidation of SymetryML (4)

 

 

 

 

 

 

 

 

 

 

 

(1,939

)

Loss on change in fair value of SAFE Notes (5)

 

 

 

 

 

 

 

 

 

 

 

788

 

(Gain) loss on fair value of investment in SymetryML Holdings

 

 

(5

)

 

 

39

 

 

 

153

 

 

 

49

 

Separation expense related to headcount reductions

 

 

 

 

 

270

 

 

 

 

 

 

270

 

Non-core operations (6)

 

 

 

 

 

 

 

 

 

 

 

351

 

Adjusted EBITDA

 

$

4,734

 

 

$

3,586

 

 

$

8,529

 

 

$

12,200

 

 

(1)
Includes professional fees directly related to the SPAC merger with MCAP Acquisition Corporation (the “Business Combination”) on December 22, 2021.
(2)
In connection with the Business Combination, a Seller's Earn-Out liability was recorded. The gain represents the decrease in fair value of the Seller's Earn-Out in the three and nine months ended September 30, 2023 and 2022
(3)
In connection with the Business Combination, a liability for warrants was recorded. The gain represents the decrease in fair value of the warrants in the three and nine months ended September 30, 2023 and 2022.
(4)
On March 31, 2022, the Company deconsolidated SymetryML which resulted in a gain. Refer to Note 16 — SymetryML and SymetryML Holdings of the Company's Condensed Consolidated Financial Statements, included in its Form 10-Q as of September 30, 2023, filed today, for more information.
(5)
On March 31, 2022, the SAFE Notes (defined below) were valued which resulted in a loss. Refer to Note 16 — SymetryML and SymetryML Holdings of the Company's Condensed Consolidated Financial Statements, included in its Form 10-Q as of September 30, 2023, filed today, for more information.
(6)
Effective as of March 1, 2020, the Company effectuated a contribution of its SymetryML department into a new subsidiary, SymetryML, Inc. The Company periodically raised capital to fund Symetry operations, by entering into Simple Agreement for Future Equity Notes (“SAFE Notes”) with several parties. The Company viewed SymetryML operations as non-core, and did not fund future operational expenses incurred in excess of SAFE Note funding secured. Effective March 31, 2022, the Company

 


 

deconsolidated SymetryML. Refer to Note 16 — SymetryML and SymetryML Holdings of the Company's Condensed Consolidated Financial Statements, included in its Form 10-Q as of September 30, 2023, filed today, for more information.

 

The following table presents Adjusted EBITDA as a Percentage of Adjusted Gross Profit and Adjusted Gross Profit as a Percentage of Revenue:

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

 

(In thousands, except percentages)

 

Gross Profit

 

$

18,871

 

 

$

18,003

 

 

$

50,010

 

 

$

56,094

 

Net (loss) income

 

$

(4,194

)

 

$

5,725

 

 

$

(1,335

)

 

$

21,212

 

Net (loss) income as a percentage of Gross Profit

 

 

-22.2

%

 

 

31.8

%

 

 

-2.7

%

 

 

37.8

%

Adjusted Gross Profit

 

$

26,390

 

 

$

24,742

 

 

$

71,329

 

 

$

76,073

 

Adjusted EBITDA

 

$

4,734

 

 

$

3,586

 

 

$

8,529

 

 

$

12,200

 

Adjusted EBITDA as a percentage of Adjusted Gross Profit

 

 

17.9

%

 

 

14.5

%

 

 

12.0

%

 

 

16.0

%

Gross Profit

 

$

18,871

 

 

$

18,003

 

 

$

50,010

 

 

$

56,094

 

Revenue

 

$

40,890

 

 

$

37,584

 

 

$

111,151

 

 

$

114,301

 

Gross Profit as a percentage of Revenue

 

 

46.2

%

 

 

47.9

%

 

 

45.0

%

 

 

49.1

%

Revenue

 

$

40,890

 

 

$

37,584

 

 

$

111,151

 

 

$

114,301

 

Adjusted Gross Profit

 

$

26,390

 

 

$

24,742

 

 

$

71,329

 

 

$

76,073

 

Adjusted Gross Profit as a percentage of Revenue

 

 

64.5

%

 

 

65.8

%

 

 

64.2

%

 

 

66.6

%

 

 


Slide 1

INVESTOR PRESENTATION Q3 2023 Disclaimer This communication contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain words such as “believe,” “anticipate,” “expect,” “estimate,” “intend,” “project,” “plan,” or words or phrases with similar meaning. Forward-looking statements should not be read as a guarantee of future performance or results and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved. Forward-looking statements contained in this presentation relate to, among other things, the Company’s projected financial performance and operating results, including projected revenue, Adjusted Gross Profit and Adjusted EBITDA. Forward-looking statements are based on current expectations, forecasts and assumptions that involve risks and uncertainties, including, but not limited to, the market for programmatic advertising developing slower or differently than the Company’s expectations, the demands and expectations of clients and the ability to attract and retain clients and other economic, competitive, governmental and technological factors outside of the Company's control, that may cause the Company's business, strategy or actual results to differ materially from the forward-looking statements. The Company does not intend and undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable law. Investors are referred to AdTheorent's filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K and any subsequent filings on Forms 10-Q or 8-K, for additional information regarding the risks and uncertainties that may cause actual results to differ materially from those expressed in any forward-looking statement. November 7, 2023 Exhibit 99.2


Slide 2

INVESTMENT HIGHLIGHTS & MISSION Pages 3-4 ADTHEORENT’S ML ADVANTAGE Pages 8-10 ADTHEORENT TECHNOLOGY PLATFORM Pages 15-16 GO-TO-MARKET Pages 17-20 KEY GROWTH DRIVERS Pages 21-28 HISTORY OF PROFITABLE GROWTH Pages 29-34 Table of Contents MARKET OPPORTUNITY Pages 5-7 APPENDIX Pages 35-42 ADTHEORENT OVERVIEW Pages 11-14


Slide 3

Investment Highlights and Differentiation Investment Highlights & Mission Page 3 Large and growing omni-channel programmatic advertising opportunity Industry-leading machine learning platform for advertising Award-winning AI/ML technology developed by world class technology and data science organization Privacy leadership; user ID independence Diversified client roster of large, repeat brands and agencies; history of success over competitors Industry-leading campaign performance leveraging predictive solutions New Self-Service model more than doubles AdTheorent’s Total Addressable Market (TAM) Demonstrated attractive growth profile and profitability


Slide 4

AdTheorent is dedicated to making programmatic advertising more valuable and efficient for marketers through deployment of advanced machine learning technology and data science solutions, leading the programmatic advertising industry into a privacy-forward future not dependent on ID-based user retargeting. Investment Highlights & Mission Page 4 MISSION STATEMENT


Slide 5

AdTheorent primarily targets the fast-growing, $100B+ Programmatic Media Market in the U.S. CAGR: 10.1% ($ in Bn) Programmatic Media Market Growth Drivers Emerging platforms and channels; diversified ad formats Data privacy and regulation; demand for ID-independent solutions Cross-device targeting, measurement and attribution Quality and brand safety (eliminate waste) Alliances with publishers, data and technology providers; brands want help Global expansion; privacy opportunities Programmatic Digital Display Ad Spending US 2021-2025 Market Opportunity Page 5 Source: Insider Intelligence | eMarketer, April 2023 Note: digital display ads transacted or fulfilled via automation, including everything from publisher-erected APIs to more standardized RTB technology; includes native ads and ads on social networks like Facebook and Twitter; includes advertising that appears on desktop and laptop computers as well as mobile phones, tablets and other internet-connected devices MARKET OPPORTUNITY


Slide 6

The Digital Advertising opportunity is bigger than Social Media Brands only running on social platforms are missing 85% of consumer’s time spent with digital media. AdTheorent connects brands to consumers across all digital activities 8 hours, 39 minutes average time spent with digital media per day Gaming Browsing (i.e. search, shopping) INCLUDES: Source: eMarketer 2022 DIGITAL ACTIVITIES Reading News E-mail Voice/Video Chats 21% Connected TV 15% Social Media 21% Connected TV 15% Social Media Market Opportunity Page 6


Slide 7

AdTheorent leverages proprietary machine learning technology to activate across the entire biddable advertising ecosystem Market Opportunity Page 7 DEMAND SIDE PLATFORM (DSP) + ADVERTISERS Brands & Agencies SUPPLY SIDE PLATFORMS (SSP) PUBLISHERS CONSUMERS “WALLED GARDEN” PLATFORMS Privacy Forward AI/Machine Learning Platform THE “OPEN” INTERNET


Slide 8

01. There is a user visiting the site. 02. Do you want to place an ad? AdTheorent’s ML Advantage Page 8 IF User ID = in audience123 IF User ID = visited website THEN Yes IF User ID = within geo location THEN Yes THEN Yes AD SERVER Most advertising relies on a few data points to determine whether to serve an ad. INDUSTRY STANDARD DSP TARGETING APPROACH: AdTheorent’s ML Advantage


Slide 9

AdTheorent’s Machine Learning platform looks at all available data to assign each impression a predictive score without the need for a cookie or user ID 01. There is a user visiting the site. 02. Will placing an ad on this impression lead to a successful outcome? 200+ 1st PARTY DEVICE DATA POINTS, 1000+ CONSUMER DATA ATTRIBUTES and NLP DERIVED SIGNALS AD SERVER IF Predictive Score ≥ 90 THEN Serve ad ML PLATFORM Predictive Score: 97 PUBLISHER BROWSER NAME AD POSITION DEVICE NAME PURCHASE PREDICTORS CREATIVE TYPE PAGE URL DECLARED AGE LANGUAGE SETTINGS CITY IAB CATEGORY LIFE EVENT TEMPERATURE TIME DECLARED GENDER DEVICE CARRIER HOUSEHOLD INCOME LAT/LONG NLP SIGNALS AdTheorent’s ML Advantage Page 9 OPERATING SYSTEM ADTHEORENT’S DIFFERENTIATED IMPRESSION SCORING APPROACH: CAMPAIGN GOAL


Slide 10

01. Create your Ideal Audience from multiple data attributes within the ABi ™️ Audience Builder 02. AdTheorent’s Audience Quality Algorithms score every impression based on the likelihood that the impression relates to a user in your defined target audience 03. Within your target audience, AdTheorent’s KPI predictive scoring determines the likelihood that placing an ad on an impression will lead to a successful campaign outcome AD SERVER IF Passing audience quality score THEN Pass IF Predictive Score ≥ 90 THEN Serve Ad IF Predictive Score < 90 THEN Pass AdTheorent’s Predictive Platform is a differentiator in creating ID-independent audiences that drive performance IF Low audience quality score THEN AdTheorent’s ML Advantage Page 10 ADTHEORENT’S DIFFERENTIATED IMPRESSIONS SCORING APPROACH: AUDIENCE QUALITY


Slide 11

A History of Organic Growth & Innovation Corporate Achievements, Key Technology Milestones and Product Releases AdTheorent Overview Page 11 2012 2014 2013 2015 2016 2018 2017 2019 2020 2021 2022 2023 Founded 2012  New York City AdTheorent Platform 1.0 Real Time Data Machine (RTDM) Integrated to Bidding Platform CTR Models Introduced VTR Models Introduced Achieved positive Adj. EBITDA Investment Supports Organic Growth Initiatives Fraud Models Introduced LAUNCH Brand Direct Sales CPA Models Introduced 3P Discrepancy Models Advanced Predictive Creative Price Optimizer Look Alike Models BETA LAUNCH Self-Service VERTICALIZATION Framework Price + Performance Optimizer 1P Pixel & Attribution Models RTS In Models Look Alike Model Automation RTDM Model Inheritance Production Launch Self-Service Expanded CTV capabilities & grew 46% YOY Bid Shading Optimizer HABiTM & AdTheorent Health Audiences NLP Keywords in CPA Models 1000+ impression-specific data objects in ML models Multi-goal optimizer | Enhancements to campaign performance across bid price & customer KPIs 1000+ impression-specific data objects in ML models US Patent| Data Learning & Analytics Apparatuses, Methods & Systems Inventory Marketplace to bundle digital inventory across campaigns Series A Financing; Verizon Ventures AdTheorent Platform 2.0 Real Time Signals CEM AdTheorent Platform 3.0 Device Graph Extension Automation Performance Optimizer POI Augmentation & Targeting AdTheorent Platform 3.5 Device Graph Extension Automation Performance Optimizer POI Augmentation & Targeting AdTheorent Platform 3.5 Product Catalog ABi ™ Audience Builder & Predictive Audiences Natural language processing, keyword analysis to enhance impression scoring Introduced Search and Social capabilities across YouTube, Google and Meta AdTheorent Platform 4.0  AdTheorent Overview


Slide 12

AdTheorent uses award-winning, proprietary machine learning to organize, analyze and activate data to deliver real-world value for advertisers and marketers across the entire digital ecosystem. 2016-2023 North American Digital Advertising 2018-2022 A.I. Breakthrough Awards 2020 The Drum Digital Advertising Awards 2018-2023 Business Intelligence Group 2012, 2015, 2022, 2023 2022 AdExchanger Programmatic Power Player 2023 Neutronian Certified 12-time winner AdTheorent Overview Page 12 NEW! September 2023


Slide 13

AdTheorent is leading the industry into the post-ID era by giving advertisers unprecedented levels of targeting accuracy Privacy-Forward Programmatic Advertising DRIVING OUTCOMES WITHOUT SENSITIVE DATA: ML-based Predictive Advertising mitigates regulatory concerns by relying on statistical models - not sensitive data, advertising IDs or cookie-based retargeting.  AdTheorent does not use: Names Email Address Individualized Financial Information Employment Status Individualized Health Information Biometric Record AdTheorent Overview Page 13 CCPA, CPRA*, & GDPR Compliant DAA Compliant AMA Compliant FLA/ECOA Compliant LDA Compliant COPPA Compliant HIPAA Compliant NAI Certified *Additional state-by-state regulations, as adopted


Slide 14

Inventory Quality & Brand Safety AdTheorent continuously analyzes inventory signals to improve quality by identifying & removing low performing publishers and MFA properties Supply path optimization Viewability Every campaign includes viewability models to ensure ads are seen AdTheorent’s viewability models drive a 47% higher viewability rate2 Natural language processing analyzes sentiment to avoid sensitive content Anti-Fraud Real-time anti-fraud infrastructure detects fraud before the impression is served on all campaigns across all devices Double Verify certified against CTV fraud IAB bots & spiders block list Double Verify pre-bid IVT filtering & post-bid monitoring AdTheorent Overview Page 14 Advanced Tech and ML solutions address waste and inefficiency challenges cited in ANA Programmatic Media Supply Chain Transparency Study1 Transparency Performance PARTNERS & CERTIFICATIONS 100% Ads.txt verified (IAB) The ANA report highlights programmatic advertising inefficiencies around which AdTheorent has built valuable machine learning tools, delivering for advertisers the true benefit from open web programmatic advertising AdTheorent leverages more signals when scoring media opportunities; beyond blind ID-based targeting Superior cost transparency AdTheorent’s focus is ROAS, not click-bait Each campaign leverages custom performance models 1https://blog.adtheorent.com/anastudy 2AdTheorent First Party Data


Slide 15

AdTheorent's end-to-end platform does the work of multiple companies, seamlessly integrating into customer tech stacks to drive campaign performance and operational efficiency Bidding Augmentation Advanced AI & ML Capabilities Data Management PLATFORM Real-Time Data Stream ML Data Pipeline Audience Marketplace Inventory Marketplace Visitation Modeling Household Graph Predictive Modeling Reach & Frequency Viewability/Brand Safety/ Fraud/Discrepancy Models Price / KPI Optimizers Retargeting Models Keyword Models Dynamic Creative Optimization Point of Interest Capability Weather / Pollen NLP: Keyword, Topics, Sentiment Consumer Data Real-Time Signals 20+ Supply Partners Normalize Inventory Normalize Devices Normalize Geo Data Normalize Content Fraud Brand Safety Campaign Management Planning & Forecasting Targeting Suite Creative Library Cost Capture & Reporting Full Funnel ABi™ Audience Builder HABi™ Audience Builder Data & Analytics AdTheorent Technology Platform Page 15 AdTheorent TECHNOLOGY PLATFORM


Slide 16

Travel & Hospitality Site visitation Booking Incremental sale AdTheorent Health Prescription fill New patient registration Prescription card download HCP reach & engagement Retail Incremental sale Location visitation Online order Store locator Casual Dining & QSR Online & In-store sale Restaurant visitation Coupon download Commerce Form fill or sign up Purchase Store Locator Finance / Insurance Drive higher lifetime value New customer acquisition Completed application CPG Online purchase Add to cart Visitation to partner retailer Auto Vehicle sales lift Dealer visit Dealer locator engagement Vehicle build & price Government Learn More Form Fill or sign up Resource Download Education Form Fill Virtual Tour Campus visit Download more info AdTheorent’s tech-stack facilitates the development of custom, machine learning solutions that drive vertical-specific outcomes ADTHEORENT’S VERTICALIZED PREDICTIVE SOLUTIONS DRIVE SUPERIOR OUTCOMES AdTheorent Technology Platform Page 16 Telecom Location Finder View Plans Learn More Real Estate Call an Agent Application complete Calculate your mortgage


Slide 17

AdTheorent’s wide-ranging solutions appeal to a broad range of customers Agency Hold-Co Media Teams Targeting Capabilities First-To-Market Opportunities Measurement & Reporting CTV Creative Where they can add value Brand Direct Privacy Verticalized Solutions Creative Cross-Channel Activation Service and Support Health Agencies Patient & HCP Capabilities Audiences & Targeting Scale Privacy (HIPAA, NAI) Measurement Health Brands Service and Support Product Capabilities Audience Customization Look for Health Expertise Privacy + Precision Performance Marketers CPA Capabilities Attribution & Measurement Account Services Self-Service Decision Makers Platform Costs & Efficiency Capabilities & Ease of Use Optimizations Reporting Inventory & Targeting Data & Audience Teams ID-Less Audience Creation Data Sources Recency Privacy Multicultural Teams Targeting\Audiences Supplier Diversity Inventory Privacy Tier 2 Agencies White-Label Solutions Rev-Share Opportunities Live Addressable TV Creative Support Channel Sales Revenue Opportunities Services Audience Creation Margin Maximization CUSTOMER PERSONAS & NEEDS Go-to-Market Page 17 Go-to-Market


Slide 18

BRANDS WE WORK WITH* Go-to-Market Page 18 *Partial list of customers- last 12 months


Slide 19

Click-Through Rate Cost Per Click CASE STUDY: AdTheorent Outperforms Major DSP in Controlled Test Commissioned by Agency Holding Company Campaign Objective: A food & beverage brand aiming to generate awareness of their summer product line worked with AdTheorent to test AdTheorent’s targeting performance against a competitor DSP. AdTheorent‘s Solution: AdTheorent developed custom machine learning models to reach consumers with the highest likelihood of engaging. AdTheorent ran the same 3rd party audiences as the DSP competitor while also testing custom AdTheorent Predictive Audiences. more efficient Cost Per Click (CPC) 51% 43% higher Click -Through Rate (CTR) In the head-to-head 3rd party audience test, AdTheorent outperformed the DSP competitor across CTR & CPC metrics AdTheorent Predictive Audiences outperformed the DSP competitor’s 3rd Party Audience targeting driving: Performance Highlights Go-to-Market Page 19


Slide 20

\ Managed Programmatic Allows customers to seamlessly transact in the way that best meets their needs \ Self-Service ONE ADTHEORENT Direct platform access to the most advanced ML-powered DSP Scaling quickly across verticals and client types since release in 2021 Platform & Management Fee applied as a % of spend, with custom ML models and other enhancements A full-service suite of solutions from pre-campaign planning to post-campaign reporting across the digital ecosystem One platform since 2012 with continued innovation Fixed-rate pricing inclusive of full end-to-end support Go-to-Market Page 20 Benefits of Flexible Combination Clients shift between service levels based on campaign complexity As clients shift between managed and self-service, campaign data remains actionable, and models are ready to deploy


Slide 21

AdTheorent’s growth strategy drives customer adoption and increased addressable market Self-Service Growth Platform access with increased self-service offerings to enhance customer campaign management Performance CTV CTV expansion and cross platform activation Verticalization and AdTheorent Health Dedicating resources to new verticals, launching AdTheorent Health and subsequent platforms and products International Expand beyond North America and expand addressable market Key Growth Drivers Page 21 Audience Building Tools and Strategic Data Partnerships Enables a new offering that resonates in market R&D Innovation Investment toward more powerful M/L and AI capabilities Strategic Partnerships Scaling into emerging and alternative business opportunities Managed Programmatic Demand White glove service and continued additions to the managed programmatic offering differentiate AdTheorent in market Key Growth Drivers


Slide 22

Programmatic Campaign Management Partnerships – Inventory + Data AdTheorent’s Managed Programmatic Offering addresses the myriad needs of customers frustrated by the lack of service from established platforms AdTheorent’s hands-on approach is a differentiator in market and delivers industry-leading service and performance Key Growth Drivers: Managed Programmatic Service Page 22 Through Managed Programmatic, AdTheorent becomes an extension of brand and agency teams Media Strategy and Campaign Planning Ad Ops & Trafficking Support Client Services MANAGED PROGRAMMATIC SUPPORT INFRASTRUCTURE Studio A\T + Creative Planning Cross-Platform Campaign Management Data Science as a Service Data and Analytics


Slide 23

AdTheorent’s Self-Service offering expands the total addressable market Key Growth Drivers: Self-Service Page 23 Built for media buyers who want to use the industry’s best programmatic brain on a self-service basis Intuitive workflows and tools leverage AdTheorent’s 10+ years executing successful campaigns ADVERTISER COUNT INCREASE Q2 TO Q3 57% 28% SEQUENTIAL REVENUE GROWTH Q2 TO Q3


Slide 24

Key Growth Drivers: Vertical Solutions Page 24 AdTheorent’s verticalized framework offers differentiated solutions across verticals to drive increased interest from brands and specialized agencies MODELING & OPTIMIZATIONS INVENTORY & NLP KPIs & OUTCOMES PREDICTIVE AUDIENCES DATA Custom models continually optimize and identify new targeting opportunities Contextually aligned inventory increases relevancy, NLP increases performance Predictive ML drives online and real-world performance across industry-specific outcomes Audience quality algorithms utilize unique data inputs to build ID-free, privacy-forward audiences Unique, verticalized data inputs, proprietary POI and household graph data Verticalized Solutions: AdTheorent Health Travel & Tourism Multi-Location Solutions: Dining & Retail Multicultural Initiatives Political Solutions


Slide 25

ML-based predictive advertising mitigates regulatory concerns and drives real-world outcomes by relying on statistical models and not cookies or IDs \ PROPRIETARY MACHINE LEARNING PLATFORM Access HABi™️ and AdTheorent Health’s proprietary solutions in the way that best meets the needs of your health campaign \ ADTHEORENT HEALTH SELF-SERVICE \ Access to the most comprehensive health dataset available in market, developed to seamlessly research, create and activate custom, ID-less health audiences SAY “HELLO” TO HABi™️ Key Growth Drivers: Vertical Solutions Page 25 AdTheorent’s expertise in building solutions for highly regulated verticals drives growth \ AdTheorent Health aggregates health data directly, eliminating the need for 3rd party Date Warehouse providers to build custom, audiences in minutes, not months HEALTH DATA and ADTHEORENT HEALTH AUDIENCES


Slide 26

$10.2B mobile ad spend AdTheorent Health empowers partners with strategic solutions to stay ahead of the rapidly growing healthcare industry $4.5B 22% 2023 HEALTHCARE INDUSTRY DIGITAL AD SPEND FORECAST: video ad spend increase in ad spend year-over-year $17.8B 12.3% digital ad spend increase in ad spend year-over-year $7.6B desktop ad spend 64% Research prescription drug information CONSUMER HEALTHCARE ACTIVITIES CONDUCTED ON DIGITAL DEVICES: 32% of Millennials research online to discover and discuss new treatments with their doctors Key Growth Drivers: Vertical Solutions Page 26 Sources: eMarketer 2022 & 2023


Slide 27

Key Growth Drivers: Performance CTV Page 27 AdTheorent is positioned to capture an outsized share of the CTV opportunity CTV models drive towards business outcomes instead of simply delivering video views or completes Performance Data science and machine learning used for ad impression analysis and targeting, not to build user profiles or ID-based targeting segments that rely on sensitive or individualized data Privacy AdTheorent’s attribution solution ties viewership on CTV devices to outcomes on mobile and desktop devices Attribution CTV is part of an omni-channel campaign, and can be used as an upper funnel or lower funnel driver Omni-Channel Activation A talented in-house design team that deploys innovative creative executions across CTV Creative U.S. CTV Advertising Spending ($ in Billions) CAGR: 18% Source: eMarketer, March 2023. Note: digital advertising that appears on CTV devices; includes display ads that appear on home screens and in-stream video ads that appear on CTV’s from platforms like Hulu, Roku, and YouTube; excludes network-sold inventory from traditional linear TV and addressable TV advertising WHY CUSTOMERS CHOOSE ADTHEORENT FOR CTV A DIFFERENTIATED CTV SOLUTION CREATES EXPANDED REVENUE OPPORTUNITES Full-funnel campaign budgets Linear TV revenue shifting to digital channels Digital clients interested in expanding to a growing format


Slide 28

ABi™️ Audience Builder ABi-built audience quality algorithms offer a ground-breaking, higher-performing and higher-margin method to target programmatic audiences ABi facilitates the creation of audiences using multiple data attributes: Primary-sourced and fully transparent data used to build ID-independent and future-proof audiences without the need to purchase 3rd party audiences Differentiated way to utilize data attributes and proprietary data sources Key Growth Drivers: Audience Building Solutions Page 28


Slide 29

History of Profitable Growth Historical Financial Profile Third Quarter Financial Summary Capital Structure


Slide 30

History of Profitable Growth Page 30 Strong historical revenue growth profile 28.6% 12.7% 0.5% 0.4% ($ in millions) 36.6% Track record of growth – revenue has doubled since 2017 Positive momentum in Self-Service growth Notable growth in CTV and Health vertical ACTIVE CUSTOMERS 342 15% REVENUE CAGR TO $166M SINCE 2017 5% CTV YTD GROWTH THROUGH Q3 2023 +172% Self-Service CTV Growth Q2 to Q3 SELF-SERVICE YTD GROWTH THROUGH Q3 2023 938% YoY growth ADJUSTED GROSS PROFIT PER EMPLOYEE LTM THROUGH Q3 2023 $360K ADTH HEALTH AS % OF REVENUE YTD THROUGH Q3 2023 31%


Slide 31

History of Profitable Growth Page 31 Profitable business model with operating leverage 1 Adjusted EBITDA margin calculated as % of AGP 63% 65% 65% 66% margin 66% ($ in millions) 30% 35% 32% 20% margin1 39% ($ in millions) Adjusted Gross Profit Margin consistently around 65% of revenue 2022 margins remain strong despite investment in go-to-market and products to drive future growth and increased public company costs Profitability has remained positive amidst changing market conditions 61% 28% Note: Adjusted Gross Profit and Adjusted EBITDA are non-GAAP financial measures. A reconciliation of this non-GAAP financial measure to the most directly comparable GAAP financial measure is available in the appendix.


Slide 32

($ in millions) Q3 growth of ~9% was first YOY growth since mid 2022 Impacted by macro environment starting Q3 2022 Revenue 8.8% YOY GROWTH $40.9M REVENUE 64.5% ADJ. GROSS PROFIT MARGIN $26.4M ADJ. GROSS PROFIT Adj. Gross Profit 17.9% ADJ. EBITDA MARGIN1 $4.7M ADJ. EBITDA Adj. EBITDA $74.3M CASH AND CASH EQUIVALENTS $1.2M FREE CASH FLOW Cash Profile History of Profitable Growth Page 32 Third Quarter Financial Summary – return to growth 1 Adjusted EBITDA margin calculated as % of AGP Note: Adjusted Gross Profit and Adjusted EBITDA are non-GAAP financial measures. A reconciliation of this non-GAAP financial measure to the most directly comparable GAAP financial measure is available in the appendix.


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Q3 2023 OUTLOOK Q2 2023 RESULTS Q4 2023 OUTLOOK FY 2023 OUTLOOK Revenue $39 – $42M  (8% Growth2) $40.9M (9% Growth) $55 – $57M (8% Growth2) Growth Adjusted Gross Profit $26.4M ~$107M2 Adj. Gross Profit Margin 64% 64.5% at least 64% 64-65% Adjusted EBITDA $3 - $4.5M  $4.7M $10 - $11.5M ~$19M2 Adjusted EBITDA Margin1   17.9% 16-19% History of Profitable Growth Page 33 Q3 2023 financial results met our expectations 1 Adjusted EBITDA margin calculated as % of AGP 2 Growth rates calculated versus the midpoint of the guidance range Q3 2023 RESULTS Note: Adjusted Gross Profit and Adjusted EBITDA are non-GAAP financial measures. A reconciliation of this non-GAAP financial measure to the most directly comparable GAAP financial measure is available in the appendix.


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Capital structure provides flexibility to invest and resiliency to macroeconomic conditions History of Profitable Growth Page 34 CASH FLOW ~50% conversion of Adj EBTIDA to FCF annually $74.3 M in Cash and Cash Equivalents $0 DEBT REVOLVER Access to $40M through Credit Facility


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APPENDIX


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Non-GAAP MEASURES The Company uses financial measures that are not calculated in accordance with GAAP including Adjusted EBITDA and Adjusted Gross Profit. The Company's management believes that this information can assist investors in evaluating the Company's operational trends, financial performance, and cash generating capacity and make strategic decisions. Management believes these non-GAAP measures allow investors to evaluate the Company’s financial performance using some of the same measures as management.   Because of the limitations associated with these non-GAAP financial measures, “Adjusted Gross Profit,” “EBITDA,” “Adjusted EBITDA,” “Adjusted Gross Profit as a percentage of Revenue” and “Adjusted EBITDA as a percent of Adjusted Gross Profit” should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP. The Company compensates for these limitations by relying primarily on its GAAP results and using non-GAAP measures on a supplemental basis. You should review the reconciliation of the non-GAAP financial measures below and not rely on any single financial measure to evaluate AdTheorent's business. Adjusted Gross Profit is a non-GAAP profitability measure. Adjusted Gross Profit is a non-GAAP financial measure of campaign profitability, monitored by management and the Board, used to evaluate our operating performance and trends, develop short- and long-term operational plans, and make strategic decisions regarding the allocation of capital. We believe this measure provides a useful period to period comparison of campaign profitability and is useful information to investors and the market in understanding and evaluating our operating results in the same manner as our management and Board. Gross profit is the most comparable GAAP measurement, which is calculated as revenue less platform operations costs. In calculating Adjusted Gross Profit, we add back other platform operations costs, which consist of amortization expense related to capitalized software, depreciation expense, allocated costs of personnel which set up and monitor campaign performance, and platform hosting, license, and maintenance costs, to gross profit. EBITDA is a non-GAAP financial measure defined by us as net income, before interest (income) expense, net; depreciation, amortization; and income tax benefit. Adjusted EBITDA is defined as EBITDA before equity-based compensation expense, transaction costs related to the Business Combination, non-core operations, and other non-recurring items. Collectively these non-GAAP financial measures are key profitability measures used by our management and Board to understand and evaluate our operating performance and trends, develop short-and long-term operational plans, measure performance goals in employee equity incentive awards, and make strategic decisions regarding the allocation of capital. We believe that these measures can provide useful period-to-period comparisons of campaign profitability. Accordingly, we believe that these measures provide useful information to investors and the market in understanding and evaluating our operating results in the same manner as our management and the Board.


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Reconciliation net income to adjusted EBITDA 2017 2018 2019 2020 2021 2022 Net Income $ 620 $ 376 $ 5,487 $ 6,695 $ 25,419 $ 28,788 Interest expense (income), net 4,874 5,419 4,145 3,285 2,404 (263) Tax (benefit) provision (7,737) (1,319) 2,029 2,780 3,360 988 Depreciation and amortization 9,696 10,674 9,365 8,134 8,493 8,023 EBITDA $ 7,453 $ 15,150 $ 21,026 $ 20,894 $ 39,676 $ 37,536 Equity-based compensation 208 490 776 657 5,823 11,188 Seller's Earn-Out equity-based compensation — — — — 55 1,364 Transaction costs 366 301 3,200 1,412 15,603 (131) Gain on change in fair value of Seller's Earn-Out — — — — (23,399) (17,308) Gain on change in fair value of warrants — — — — (6,783) (9,868) Gain on deconsolidation of SymetryML — — — — — (1,939) Loss on change in fair value of SAFE Notes — — — — — 788 Loss on fair value of investment in SymetryML Holdings — — — — — 72 Separation expense related to headcount reductions 1,248 (6) — — — 270 Management fees 1,023 1,027 898 872 5,607 — Lease termination fee — — — — 4,243 — Non-core operations 3,934 2,990 1,208 1,047 2,155 351 Other adjustments 153 306 — — — — Adjusted EBITDA $ 14,385 $ 20,258 $ 27,108 $ 24,882 $ 42,980 $ 22,323 NOTE: EBITDA is a non-GAAP financial measure defined by us as net income, before interest (income) expense, net; depreciation, amortization; and income tax benefit. Adjusted EBITDA is defined as EBITDA before equity-based compensation expense, transaction costs related to the Business Combination, non-core operations, and other non-recurring items. We have provided above a reconciliation of this non-GAAP financial measure to the most directly comparable financial measure calculated and presented in accordance with GAAP.


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ADJUSTED EBITDA AS A PERCENTAGE OF ADJUSTED GROSS PROFIT AND ADJUSTED GROSS PROFIT AS A PERCENTAGE OF REVENUE 2017 2018 2019 2020 2021 2022 Gross Profit $ 38,539 $ 52,385 $ 60,715 $ 61,557 $ 87,595 $ 82,638 Net income $ 620 $ 376 $ 5,487 $ 6,695 $ 25,419 $ 28,788 Net income as a percentage of Gross Profit 1.6% 0.7% 9.0% 10.9% 29.0% 34.8% Adjusted Gross Profit $ 50,727 $ 67,047 $ 77,711 $ 79,032 $ 109,343 $ 109,820 Adjusted EBITDA $ 14,385 $ 20,258 $ 27,108 $ 24,882 $ 42,980 $ 22,323 Adjusted EBITDA as a percentage of Adjusted Gross Profit 28.4% 30.2% 34.9% 31.5% 39.3% 20.3% Gross Profit $ 38,539 $ 52,385 $ 60,715 $ 61,557 $ 87,595 $ 82,638 Revenue $ 83,093 $ 106,877 $ 120,406 $ 121,015 $ 165,365 $ 166,082 Gross Profit as a percentage of Revenue 46.4% 49.0% 50.4% 50.9% 53.0% 49.8% Revenue $ 83,093 $ 106,877 $ 120,406 $ 121,015 $ 165,365 $ 166,082 Adjusted Gross Profit $ 50,727 $ 67,047 $ 77,711 $ 79,032 $ 109,343 $ 109,820 Adjusted Gross Profit as a percentage of Revenue 61.0% 62.7% 64.5% 65.3% 66.1% 66.1%


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Reconciliation gross profit to adjusted gross profit 2017 2018 2019 2020 2021 2022 Revenue $ 83,093 $ 106,877 $ 120,406 $ 121,015 $ 165,365 $ 166,082 Less: Platform operations 44,554 54,492 59,691 59,458 77,770 83,444 Gross Profit 38,539 52,385 60,715 61,557 87,595 82,638 Add back: Other platform operations 12,188 14,662 16,996 17,475 21,748 27,182 Adjusted Gross Profit $ 50,727 $ 67,047 $ 77,711 $ 79,032 $ 109,343 $ 109,820 NOTE: Adjusted Gross Profit is a non-GAAP profitability measure. Adjusted Gross Profit is a non-GAAP financial measure of campaign profitability, monitored by management and the Board, used to evaluate our operating performance and trends, develop short- and long-term operational plans, and make strategic decisions regarding the allocation of capital. We have provided above a reconciliation of this non-GAAP financial measure to the most directly comparable financial measure calculated and presented in accordance with GAAP.


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Reconciliation net income to adjusted EBITDA Three Months Ended, Three Months Ended, March 31, June 30, September 30, December 30, March 31, June 30, September 30, 2022 2022 2022 2022 2023 2023 2023 Net (loss) income $ (42,290) $ 57,777 $ 5,725 $ 7,576 $ (5,223) $ 8,082 $ (4,194) Interest expense (income), net 109 47 (97) (322) (619) (424) (707) Tax (benefit) provision (1,025) (610) 1,095 1,528 2,350 (7,666) 6,254 Depreciation and amortization 2,088 1,954 1,973 2,008 2,108 2,194 2,317 EBITDA $ (41,118) $ 59,168 $ 8,696 $ 10,790 $ (1,384) $ 2,186 $ 3,670 Equity-based compensation 1,988 3,856 2,783 2,561 1,480 1,860 2,584 Seller's Earn-Out equity-based compensation 492 499 373 — — — — Transaction costs 140 (271) — — 166 — — Loss (gain) on change in fair value of Seller's Earn-Out 24,656 (37,419) (2,901) (1,644) (233) (292) (225) Loss (gain) on change in fair value of warrants 15,936 (18,523) (5,674) (1,607) 269 (415) (1,290) Gain on deconsolidation of SymetryML (1,939) — — — — — — Loss on change in fair value of SAFE Notes 788 — — — — — — Loss (gain) on fair value of investment in SymetryML Holdings — 10 39 23 168 (10) (5) Separation expense related to headcount reductions — — 270 — — — — Non-core operations 351 — — — — — — Adjusted EBITDA $ 1,294 $ 7,320 $ 3,586 $ 10,123 $ 466 $ 3,329 $ 4,734 NOTE: EBITDA is a non-GAAP financial measure defined by us as net income, before interest (income) expense, net; depreciation, amortization; and income tax benefit. Adjusted EBITDA is defined as EBITDA before equity-based compensation expense, transaction costs related to the Business Combination, non-core operations, and other non-recurring items. We have provided above a reconciliation of this non-GAAP financial measure to the most directly comparable financial measure calculated and presented in accordance with GAAP.


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Reconciliation gross profit to adjusted gross profit Three Months Ended, Three Months Ended, March 31, June 30, September 30, December 30, March 31, June 30, September 30, 2022 2022 2022 2022 2023 2023 2023 Revenue $ 34,241 $ 42,476 $ 37,584 $ 51,781 $ 32,674 $ 37,587 $ 40,890 Less: Platform operations 17,772 20,854 19,581 25,237 18,387 20,735 22,019 Gross Profit 16,469 21,622 18,003 26,544 14,287 16,852 18,871 Add back: Other platform operations 6,516 6,724 6,739 7,203 6,610 7,190 7,519 Adjusted Gross Profit $ 22,985 $ 28,346 $ 24,742 $ 33,747 $ 20,897 $ 24,042 $ 26,390 NOTE: Adjusted Gross Profit is a non-GAAP profitability measure. Adjusted Gross Profit is a non-GAAP financial measure of campaign profitability, monitored by management and the Board, used to evaluate our operating performance and trends, develop short- and long-term operational plans, and make strategic decisions regarding the allocation of capital. We have provided above a reconciliation of this non-GAAP financial measure to the most directly comparable financial measure calculated and presented in accordance with GAAP.


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ADJUSTED EBITDA AS A PERCENTAGE OF ADJUSTED GROSS PROFIT AND ADJUSTED GROSS PROFIT AS A PERCENTAGE OF REVENUE Three Months Ended, Three Months Ended, March 31, June 30, September 30, December 30, March 31, June 30, September 30, 2022 2022 2022 2022 2023 2023 2023 Gross Profit $ 16,469 $ 21,622 $ 18,003 $ 26,544 $ 14,287 $ 16,852 $ 18,871 Net (loss) income $ (42,290) $ 57,777 $ 5,725 $ 7,576 $ (5,223) $ 8,082 $ (4,194) Net (loss) income as a percentage of Gross Profit -256.8% 267.2% 31.8% 28.5% -36.6% 48.0% -22.2% Adjusted Gross Profit $ 22,985 $ 28,346 $ 24,742 $ 33,747 $ 20,897 $ 24,042 $ 26,390 Adjusted EBITDA $ 1,294 $ 7,320 $ 3,586 $ 10,123 $ 466 $ 3,329 $ 4,734 Adjusted EBITDA as a percentage of Adjusted Gross Profit 5.6% 25.8% 14.5% 30.0% 2.2% 13.8% 17.9% Gross Profit $ 16,469 $ 21,622 $ 18,003 $ 26,544 $ 14,287 $ 16,852 $ 18,871 Revenue $ 34,241 $ 42,476 $ 37,584 $ 51,781 $ 32,674 $ 37,587 $ 40,890 Gross Profit as a percentage of Revenue 48.1% 50.9% 47.9% 51.3% 43.7% 44.8% 46.2% Revenue $ 34,241 $ 42,476 $ 37,584 $ 51,781 $ 32,674 $ 37,587 $ 40,890 Adjusted Gross Profit $ 22,985 $ 28,346 $ 24,742 $ 33,747 $ 20,897 $ 24,042 $ 26,390 Adjusted Gross Profit as a percentage of Revenue 67.1% 66.7% 65.8% 65.2% 64.0% 64.0% 64.5%