EX-99.1 2 exhibit991erq316.htm EXHIBIT 99.1 ER Q3-16 Exhibit


Exhibit 99.1
REALNETWORKS ANNOUNCES THIRD QUARTER 2016 RESULTS

 
•
Revenue of $31.1 million, up 4% from the prior quarter;
•
GAAP net loss and adjusted EBITDA improve by 86% and 59%, respectively, year over year;
•
Cash and short-term investments increases to $80.7 million; and
•
Operating results led by GameHouse's 14% growth from the prior quarter -- New game titles performing strongly


SEATTLE - November 3, 2016 - RealNetworks, Inc. (Nasdaq: RNWK), a leader in personal digital entertainment, today announced results for the third quarter ended September 30, 2016.
For the third quarter of 2016, revenue was $31.1 million, up 4% from $29.7 million in the previous quarter and up 4% from $29.8 million in the third quarter of 2015, excluding revenue from the social casino games business, which was sold during the third quarter of 2015.
GAAP net loss for the third quarter of 2016 was $(3.1) million or $(0.08) per share, which improved by 86% compared to $(21.2) million or $(0.59) per share in the third quarter of 2015. Adjusted EBITDA for the third quarter of 2016 was a loss of $(4.4) million, which improved by 59% compared to $(10.9) million for the third quarter of 2015, excluding the results in the prior period of the social casino games business. Adjusted EBITDA improved due to significant reductions in ongoing operating expenses. The GAAP results for the third quarter of 2016 also benefitted by $6.0 million of gain on payment received from the sale of the social casino games business and from the recent sale of another non-strategic asset. A reconciliation of GAAP net income (loss) to adjusted EBITDA is provided in the financial tables that accompany this release.
"For 2016 we established three major financial goals. We're on course to achieve two of them," said Rob Glaser, Chairman and CEO of RealNetworks. "We've stabilized our businesses and have begun to see revenue growth.
"We're particularly pleased with the strong performance of our new first-party titles in our GameHouse unit, with sales up 14% sequentially, as we continue to ramp up production of high quality games. We're also continuing to roll out the integration of our mobile products with carriers like Vivo, Verizon, and Vodafone.
"Our third financial goal of the company was to return to profitability by the end of the year. While we have significantly reduced our costs, EBITDA loss and cash consumption - in fact in Q3 we increased our cash position by $2.0 million, we do not currently expect to return to EBITDA profitability in 2016. While we are not making this change lightly, we think we're making the right mid- to long-term tradeoff by making measured investments to drive our future growth and profitability."
As of September 30, 2016, the Company had $80.7 million in unrestricted cash, cash equivalents and short-term investments, up from $78.8 million as of June 30, 2016.

Business Outlook

For the fourth quarter of 2016, RealNetworks expects total revenue in the range of $29 million to $32 million and an adjusted EBITDA loss for the fourth quarter in the range of $(3.0) million to $(5.0) million.





Webcast and Conference Call Information

The company will host a conference call today to review results and discuss the company’s performance at 5 p.m. ET/2 p.m. PT. You may join the conference call by calling 888-790-3440 or +1-517-308-9350 (Passcode: Third Quarter Earnings). A live webcast of the call will be available at http://investor.realnetworks.com/ and an on-demand webcast will be available approximately one hour following the conclusion of the conference call. A telephonic replay will be available until 10:59 p.m. PT, November 24, 2016 by calling 866-509-6763 or +1-203-369-1928 (Passcode: 1132016).


For More Information

Investor Relations for RealNetworks
+1-206-729-3625
IR@realnetworks.com

RNWK-F


About RealNetworks

RealNetworks creates innovative applications and services that make it easy to connect with and enjoy digital media. RealNetworks invented the streaming media category in 1995 and continues to connect consumers with their digital media both directly and through partners, aiming to support every network, device, media type and social network. RealNetworks’ corporate information is located at www.realnetworks.com/about-us.

RealNetworks and RealTimes are trademarks or registered trademarks of RealNetworks, Inc. or its subsidiaries. All other companies or products listed herein are trademarks or registered trademarks of their respective owners.


About Non-GAAP Financial Measures
To supplement RealNetworks' consolidated financial information presented in accordance with GAAP in this press release, the company also discloses certain non-GAAP financial measures, including adjusted EBITDA and contribution margin by reportable segment, which management believes provide investors with useful information.
In the financial tables of our earnings press release, RealNetworks has included reconciliations of GAAP net income (loss) to adjusted EBITDA and operating income (loss) by reportable segment to contribution margin by reportable segment.
The rationale for management's use of non-GAAP measures is included in the supplementary materials presented with the quarterly earnings materials. Please refer to Exhibit 99.2 (“Information Regarding Non-GAAP Financial Measures”) to the company's report on Form 8-K, which is being submitted today to the SEC.

Forward-Looking Statements

This press release contains forward-looking statements that involve risks and uncertainties, including statements relating to RealNetworks' current expectations regarding future revenue and adjusted EBITDA, our future growth, profitability, and market position, our strategic focus and initiatives, agreements with partners, and the growth and future prospects relating to our Rhapsody affiliate. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements. These statements




reflect RealNetworks’ expectations as of today, and actual results may differ materially from the results predicted. Factors that could cause actual results to differ from the results predicted include: RealNetworks' ability to realize operating efficiencies, growth and other benefits from the implementation of its growth plan, strategic initiatives, and restructuring efforts; the emergence of new entrants and competition in the market for digital media products and services; other competitive risks, including the growth of competing technologies, products and services; the potential outcomes and effects of claims and legal proceedings on RealNetworks' business, prospects, financial condition or results of operations; risks associated with key customer or strategic relationships, business acquisitions and the introduction of new products and services; changes in consumer and advertising spending in response to disruptions in the global financial markets; fluctuations in foreign currencies; and changes in RealNetworks' effective tax rate. More information about potential risk factors that could affect RealNetworks' business and financial results is included in RealNetworks' annual report on Form 10-K for the most recent year ended December 31, its quarterly reports on Form 10-Q and in other reports and documents filed by RealNetworks from time to time with the Securities and Exchange Commission. The preparation of RealNetworks' financial statements and forward-looking financial guidance requires the company to make estimates and assumptions that affect the reported amount of assets and liabilities, and revenues and expenses during the reported period.  Actual results may differ materially from these estimates under different assumptions or conditions. The company assumes no obligation to update any forward-looking statements or information, which are in effect as of their respective dates.









RealNetworks, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(Unaudited)

 
 
Quarters Ended
September 30,
 
Nine Months Ended
September 30,
 
 
 

 
2016
 
2015
 
2016
 
2015
 
 
 (in thousands, except per share data)
 
 
 
 
 
 
 
 
 
 Net revenue
 
$
31,051

 
$
30,823

 
$
89,015

 
$
95,374

 Cost of revenue
 
16,740

 
18,090

 
47,610

 
54,469

           Gross profit
 
14,311

 
12,733

 
41,405

 
40,905

 
 
 
 
 
 
 
 
 
 Operating expenses:
 
 
 


 

 

       Research and development
 
6,699

 
10,501

 
23,185

 
34,681

       Sales and marketing
 
7,183

 
11,938

 
24,157

 
38,822

       General and administrative
 
7,086

 
7,021

 
21,380

 
21,312

       Restructuring and other charges
 
499

 
3,114

 
1,297

 
5,563

       Lease exit and related charges
 
1,233

 
2,121

 
2,191

 
2,208

 
 
 
 
 
 
 
 
 
           Total operating expenses
 
22,700

 
34,695

 
72,210

 
102,586

 
 
 
 
 
 
 
 
 
 Operating income (loss)
 
(8,389
)
 
(21,962
)
 
(30,805
)
 
(61,681
)
 
 
 
 
 
 
 
 
 
 Other income (expenses):
 
 
 
 
 
 
 
 
       Interest income, net
 
119

 
147

 
316

 
597

       Gain (loss) on investments, net
 
6,021

 
(615
)
 
5,978

 
(222
)
       Equity in net loss of Rhapsody
 
(233
)
 
(735
)
 
(629
)
 
(13,831
)
       Other income (expense), net
 
(243
)
 
297

 
(515
)
 
628

 
 
 
 
 
 
 
 
 
           Total other income (expense), net
 
5,664

 
(906
)
 
5,150

 
(12,828
)
 
 
 
 
 
 
 
 
 
 Income (loss) before income taxes
 
(2,725
)
 
(22,868
)
 
(25,655
)
 
(74,509
)
 Income tax expense (benefit)
 
331

 
(1,684
)
 
919

 
(1,075
)
 
 
 
 
 
 
 
 
 
 Net income (loss)
 
$
(3,056
)
 
$
(21,184
)
 
$
(26,574
)
 
$
(73,434
)
 
 
 
 
 
 
 
 
 
 Basic net income (loss) per share
 
$
(0.08
)
 
$
(0.59
)
 
$
(0.72
)
 
$
(2.03
)
 Diluted net income (loss) per share
 
$
(0.08
)
 
$
(0.59
)
 
$
(0.72
)
 
$
(2.03
)
 
 
 
 
 
 
 
 
 
 Shares used to compute basic net income (loss) per share
 
36,805

 
36,191

 
36,693

 
36,134

 Shares used to compute diluted net income (loss) per share
 
36,805

 
36,191

 
36,693

 
36,134

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 





RealNetworks, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(Unaudited)
 
September 30,
2016
 
December 31,
2015
 
 (in thousands)
ASSETS
 Current assets:
 
 
 
 Cash and cash equivalents
$
38,284

 
$
47,315

 Short-term investments
42,465

 
51,814

 Trade accounts receivable, net
25,287

 
22,511

 Deferred costs, current portion
852

 
460

 Prepaid expenses and other current assets
5,166

 
7,140

 Total current assets
112,054

 
129,240

 
 
 
 
 Equipment and software
57,014

 
66,702

 Leasehold improvements
3,204

 
3,122

 Total equipment, software, and leasehold improvements
60,218

 
69,824

 Less accumulated depreciation and amortization
54,339

 
61,024

 Net equipment, software, and leasehold improvements
5,879

 
8,800

 
 
 
 
 Restricted cash equivalents and investments
2,700

 
2,890

 Available for sale securities
2,041

 
1,721

 Other assets
1,908

 
2,307

 Deferred costs, non-current portion
1,236

 
212

 Deferred tax assets, net
1,015

 
957

 Other intangible assets, net
1,224

 
2,136

 Goodwill
12,974

 
13,080

 
 
 
 
 Total assets
$
141,031

 
$
161,343

 
 
 
 
 LIABILITIES AND SHAREHOLDERS' EQUITY
 
 
 
 
 Current liabilities:
 
 
 
 Accounts payable
$
18,379

 
$
17,050

 Accrued and other current liabilities
16,547

 
17,320

 Deferred revenue, current portion
3,883

 
3,497

 Total current liabilities
38,809

 
37,867

 
 
 
 
 Deferred revenue, non-current portion
343

 
105

 Deferred rent
504

 
620

 Deferred tax liabilities, net
100

 
88

 Other long-term liabilities
1,935

 
1,980

 
 
 
 
 Total liabilities
41,691

 
40,660

 
 
 
 
 
 
 
 
 Shareholders' equity
99,340

 
120,683

 
 
 
 
 Total liabilities and shareholders' equity
$
141,031

 
$
161,343







RealNetworks, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(Unaudited)
 
Nine Months Ended
September 30,
 
 
2016
 
2015
 
 (in thousands)
 
 Cash flows from operating activities:
 
 
 
 Net income (loss)
$
(26,574
)
 
$
(73,434
)
 Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation and amortization
5,897

 
7,952

Stock-based compensation
4,557

 
3,761

Equity in net loss of Rhapsody
629

 
13,831

Deferred income taxes, net
(198
)
 
(1,531
)
Loss (gain) on investments, net
(5,978
)
 
222

Realized translation loss (gain)
272

 
(264
)
Fair value of warrants granted in 2015, net of subsequent mark to market adjustments in 2016 and 2015
112

 
(1,078
)
Net change in certain operating assets and liabilities
(1,011
)
 
(5,428
)
  Net cash provided by (used in) operating activities
(22,294
)
 
(55,969
)
 Cash flows from investing activities:
 
 
 
Purchases of equipment, software, and leasehold improvements
(2,009
)
 
(1,110
)
Proceeds from sale of equity and other investments
2,110

 
459

Purchases of short-term investments
(59,124
)
 
(52,475
)
Proceeds from sales and maturities of short-term investments
68,473

 
60,516

Decrease (increase) in restricted cash equivalents and investments, net
190

 
—

Acquisitions
(150
)
 
(161
)
Advance to Rhapsody
—

 
(5,000
)
Receipt of payment from Rhapsody
—

 
5,000

Proceeds from the sale of Slingo and social casino business
4,000

 
10,000

 Net cash provided by (used in) investing activities
13,490

 
17,229

 Cash flows from financing activities:
 
 
 
Proceeds from issuance of common stock (stock options and stock purchase plan)
166

 
297

Tax payments from shares withheld upon vesting of restricted stock
(843
)
 
(69
)
 Net cash provided by (used in) financing activities
(677
)
 
228

 Effect of exchange rate changes on cash and cash equivalents
450

 
(2,910
)
 Net increase (decrease) in cash and cash equivalents
(9,031
)
 
(41,422
)
 Cash and cash equivalents, beginning of period
47,315

 
103,253

 Cash and cash equivalents, end of period
$
38,284

 
$
61,831










RealNetworks, Inc. and Subsidiaries
Supplemental Financial Information
(Unaudited)
 
2016
 
2015
 
 
 Q3
 
 Q2
 
Q1
 
 Q4
 
 Q3
 
 Q2
 
 Q1
 
 (in thousands)
Net Revenue by Line of Business
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Consumer Media (A)
 
$
6,482

 
$
6,400

 
$
5,726

 
$
6,848

 
$
6,495

 
$
7,281

 
$
7,989

Mobile Services (B)
 
17,683

 
17,297

 
16,465

 
16,369

 
16,484

 
18,578

 
14,504

Games (C)
 
6,886

 
6,037

 
6,039

 
6,705

 
7,844

 
8,095

 
8,104

     Total net revenue
 
$
31,051

 
$
29,734

 
$
28,230

 
$
29,922

 
$
30,823

 
$
33,954

 
$
30,597

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net Revenue by Product
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Consumer Media
 
 
 
 
 
 
 
 
 
 
 
 
 
 
- License (D)
 
$
4,136

 
$
3,914

 
$
3,104

 
$
3,967

 
$
3,628

 
$
4,208

 
$
4,672

- Subscriptions (E)
 
1,931

 
1,871

 
1,975

 
2,054

 
2,147

 
2,372

 
2,384

- Media Properties (F)
 
415

 
615

 
647

 
827

 
720

 
701

 
933

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Mobile Services
 
 
 
 
 
 
 
 
 
 
 
 
 
 
- SaaS (G)
 
17,141

 
17,208

 
16,220

 
16,157

 
16,217

 
18,218

 
13,322

- Technology License & Other (H)
 
542

 
89

 
245

 
212

 
267

 
360

 
1,182

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Games
 
 
 
 
 
 
 
 
 
 
 
 
 
 
- License (I)
 
3,683

 
2,793

 
2,761

 
3,268

 
4,128

 
3,943

 
3,835

- Subscriptions (J)
 
3,005

 
3,024

 
3,029

 
3,126

 
3,231

 
3,373

 
3,570

- Media Properties (K)
 
198

 
220

 
249

 
311

 
485

 
779

 
699

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
     Total net revenue
 
$
31,051

 
$
29,734

 
$
28,230

 
$
29,922

 
$
30,823

 
$
33,954

 
$
30,597

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net Revenue by Geography
 
 
 
 
 
 
 
 
 
 
 
 
 
 
United States
 
$
10,642

 
$
10,355

 
$
10,383

 
$
10,781

 
$
11,460

 
$
12,303

 
$
12,349

Rest of world
 
20,409

 
19,379

 
17,847

 
19,141

 
19,363

 
21,651

 
18,248

     Total net revenue
 
$
31,051

 
$
29,734

 
$
28,230

 
$
29,922

 
$
30,823

 
$
33,954

 
$
30,597

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net Revenue by Line of Business
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(A) The Consumer Media division primarily includes revenue from RealPlayer and related products, such as the distribution of third-party software products, advertising on RealPlayer websites, sales of RealPlayer Plus software licenses to consumers, sales of intellectual property licenses, and consumer subscriptions such as RealPlayer Plus and SuperPass.
(B) The Mobile Services division primarily includes revenue from SaaS services and sales of professional services provided to mobile carriers.
(C) The Games division primarily includes revenue from sales of games licenses, online games subscription services, advertising on games sites and social network sites, microtransactions from online and social games, and sales of mobile games.
Net Revenue by Product
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(D) Licensing revenue within Consumer Media includes sales of intellectual property licenses and RealPlayer Plus software licenses to consumers.
(E) Subscriptions revenue within Consumer Media includes revenue from subscriptions such as our RealPlayer Plus and SuperPass offerings.
(F) Media Properties revenue within Consumer Media includes distribution of third-party software products and advertising on RealPlayer websites.
(G) SaaS revenue within Mobile Services includes revenue from music on demand, ringback tones, intercarrier messaging services, and RealTimes.
(H) Technology licensing and other revenue within Mobile Services includes revenue from professional services provided to mobile carriers.
(I) Licensing revenue within Games includes retail games-related revenue and sales of mobile games.
(J) Subscriptions revenue within Games includes revenue from online games subscriptions as well as microtransactions from mobile and social games.
(K) Media Properties revenue within Games includes advertising on games sites and social network sites.




RealNetworks, Inc. and Subsidiaries
Segment Results of Operations and Reconciliation to non-GAAP Contribution Margin
(Unaudited)



 
 
2016
 
2015
 
2016
 
2015
 
 
Q3
 
Q2
 
Q3
 
YTD
 
YTD
 
 
 (in thousands)
Consumer Media
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net revenue
 
$
6,482

 
$
6,400

 
$
6,495

 
$
18,608

 
$
21,765

Cost of revenue
 
1,507

 
1,561

 
3,142

 
5,485

 
10,173

   Gross profit
 
4,975

 
4,839

 
3,353

 
13,123

 
11,592

 
 
 
 
 
 
 
 
 
 
 
   Gross margin
 
77
%
 
76
%
 
52
%
 
71
%
 
53
%
 
 
 
 
 
 
 
 
 
 
 
Operating expenses
 
4,271

 
4,293

 
6,421

 
13,940

 
19,882

Operating income (loss), a GAAP measure
 
$
704

 
$
546

 
$
(3,068
)
 
$
(817
)
 
$
(8,290
)
Depreciation and amortization
 
295

 
375

 
519

 
1,973

 
1,508

 
 
 
 
 
 
 
 
 
 
 
  Contribution margin, a non-GAAP measure
 
$
999

 
$
921

 
$
(2,549
)
 
$
1,156

 
$
(6,782
)
 
 
 
 
 
 
 
 
 
 
 
Mobile Services
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net revenue
 
$
17,683

 
$
17,297

 
$
16,484

 
$
51,445

 
$
49,566

Cost of revenue
 
13,026

 
12,404

 
12,512

 
36,347

 
36,802

   Gross profit
 
4,657

 
4,893

 
3,972

 
15,098

 
12,764

 
 
 
 
 
 
 
 
 
 
 
   Gross margin
 
26
%
 
28
%
 
24
%
 
29
%
 
26
%
 
 
 
 
 
 
 
 
 
 
 
Operating expenses
 
8,075

 
8,784

 
11,093

 
26,653

 
35,153

Operating income (loss), a GAAP measure
 
$
(3,418
)
 
$
(3,891
)
 
$
(7,121
)
 
$
(11,555
)
 
$
(22,389
)
Acquisitions related intangible asset amortization
 
208

 
209

 
389

 
725

 
1,165

Depreciation and amortization
 
403

 
608

 
493

 
1,433

 
1,652

 
 
 
 
 
 
 
 
 
 
 
Contribution margin, a non-GAAP measure
 
$
(2,807
)
 
$
(3,074
)
 
$
(6,239
)
 
$
(9,397
)
 
$
(19,572
)
 
 
 
 
 
 
 
 
 
 
 
Games
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net revenue
 
$
6,886

 
$
6,037

 
$
7,844

 
$
18,962

 
$
24,043

Cost of revenue
 
2,203

 
1,817

 
2,513

 
5,865

 
7,593

   Gross profit
 
4,683

 
4,220

 
5,331

 
13,097

 
16,450

 
 
 
 
 
 
 
 
 
 
 
   Gross margin
 
68
%
 
70
%
 
68
%
 
69
%
 
68
%
 
 
 
 
 
 
 
 
 
 
 
Operating expenses
 
4,649

 
4,725

 
6,431

 
14,669

 
23,833

Operating income (loss), a GAAP measure
 
$
34

 
$
(505
)
 
$
(1,100
)
 
$
(1,572
)
 
$
(7,383
)
Acquisitions related intangible asset amortization
 
29

 
34

 
170

 
88


775

Depreciation and amortization
 
104

 
154

 
214

 
437


755

 
 
 
 
 
 
 
 
 
 
 
   Contribution margin, a non-GAAP measure
 
$
167

 
$
(317
)
 
$
(716
)
 
$
(1,047
)
 
$
(5,853
)
 
 
 
 
 
 
 
 
 
 
 
Corporate
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cost of revenue
 
$
4

 
$
(84
)
 
$
(77
)
 
$
(87
)
 
$
(99
)
   Gross profit
 
(4
)
 
84

 
77

 
87

 
99

 
 
 
 
 
 
 
 
 
 
 
   Gross margin
 
N/A

 
N/A

 
N/A

 
N/A

 
N/A

 
 
 
 
 
 
 
 
 
 
 
Operating expenses
 
5,705

 
3,871

 
10,750

 
16,948

 
23,718

Operating income (loss), a GAAP measure
 
$
(5,709
)
 
$
(3,787
)
 
$
(10,673
)
 
$
(16,861
)
 
$
(23,619
)
Other income (expense), net
 
(243
)
 
15

 
297

 
(515
)
 
628

Depreciation and amortization
 
634

 
246

 
1,273

 
1,241

 
2,097

Restructuring and other charges
 
499

 
413

 
3,114

 
1,297

 
5,563

Stock-based compensation
 
778

 
608

 
1,178

 
4,557

 
3,761

Lease exit and related charges
 
1,233

 
127

 
2,121

 
2,191

 
2,208

 
 
 
 
 
 
 
 
 
 
 
   Contribution margin, a non-GAAP measure
 
$
(2,808
)
 
$
(2,378
)
 
$
(2,690
)
 
$
(8,090
)
 
$
(9,362
)
 
 
 
 
 
 
 
 
 
 
 











RealNetworks, Inc. and Subsidiaries
Reconciliation of Net income (loss) to adjusted EBITDA, a non-GAAP measure
(Unaudited)
 
 
2016
 
2015
 
2016
 
2015
 
 
 Q3
 
 Q2
 
 Q3
 
 YTD
 
 YTD
 
 
 (in thousands)
 
 
 
 
 
 
 
 
 
 
 
Reconciliation of GAAP operating income (loss) to adjusted EBITDA:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income (loss)
 
$
(3,056
)
 
$
(8,347
)
 
$
(21,184
)
 
$
(26,574
)
 
$
(73,434
)
Income tax expense (benefit)
 
331

 
363

 
(1,684
)
 
919

 
(1,075
)
Interest income, net
 
(119
)
 
(80
)
 
(147
)
 
(316
)
 
(597
)
Gain (loss) on investments, net
 
(6,021
)
 
46

 
615

 
(5,978
)
 
222

Equity in net loss of Rhapsody
 
233

 
396

 
735

 
629

 
13,831

Acquisitions related intangible asset amortization
 
237

 
243

 
559

 
813

 
1,940

Depreciation and amortization
 
1,436

 
1,383

 
2,499

 
5,084

 
6,012

Restructuring and other charges
 
499

 
413

 
3,114

 
1,297

 
5,563

Stock-based compensation
 
778

 
608

 
1,178

 
4,557

 
3,761

Lease exit and related charges
 
1,233

 
127

 
2,121

 
2,191

 
2,208

   Adjusted EBITDA, a non-GAAP measure
 
$
(4,449
)

$
(4,848
)
 
$
(12,194
)
 
$
(17,378
)
 
$
(41,569
)