8-K

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

November 1, 2012

Date of Report

Date of earliest event reported

BLUCORA, INC.

(Exact name of Registrant as specified in its charter)

DELAWARE	000-25131	91-1718107
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

601 108^th Avenue N.E., Suite 1200

Bellevue, Washington 98004

(Address of Principal Executive Offices)

425-201-6100

Registrant’s Telephone Number, Including Area Code

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

Item 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION

On November 1, 2012, Blucora announced its financial results for the three-month period ended September 30, 2012. Copies of the press release and a supplemental investor presentation are furnished to, but not filed with, the Commission as Exhibits 99.1 and 99.2 hereto.

Item 9.01 FINANCIAL STATEMENTS AND EXHIBITS

(d) EXHIBITS.

99.1	Press release dated November 1, 2012
99.2	Investor presentation dated November 1, 2012

-2-

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 hereunto duly authorized.

Date: November 1, 2012

BLUCORA, INC.
By:	/s/ Eric M. Emans
	Eric M. Emans
	Chief Financial Officer

-3-

EXHIBIT INDEX

Exhibit No	Description
99.1	Press Release dated November 1, 2012
99.2	Investor presentation dated November 1, 2012

-4-

EX-99.1

Exhibit 99.1

Blucora Announces Strong Third Quarter Results

BELLEVUE, Wash., November 1, 2012 (BUSINESS WIRE) — Blucora, Inc. (NASDAQ: BCOR) today announced financial results for the third quarter ended September 30, 2012.

“I am pleased to report Blucora had another quarter of strong performance, driven by great results from our online search business,” said Bill Ruckelshaus, President and Chief Executive Officer of Blucora. “I am also pleased with the progress our tax preparation business has made during the offseason to improve the core product and position for long-term growth.”

“Overall, the strategies in place at Blucora are proving out and our teams are executing well. We are pleased with our progress and optimistic about our future plans.” Ruckelshaus added

Summary Financial Performance: 3Q 2012

($ in millions except per share amounts)

	Q3 2012			Q3 2011		Growth
Revenue	$	92.9		$	56.3		65	%
Search	$	91.4		$	56.3		62	%
Tax Preparation	$	1.5			N/A		N/A
Adjusted EBITDA	$	12.1		$	8.5		42	%
Non-GAAP Net Income	$	10.4		$	6.8		52	%
Non-GAAP Diluted EPS	$	0.25		$	0.17		47	%
Net Income (Loss)	$	(2.4	)*	$	2.1		N/A
GAAP Diluted Income (Loss) Per Share	$	(0.06	)*	$	0.05		N/A

* Includes a $4.3 million non-cash loss on derivative instrument.

See reconciliation of non-GAAP to GAAP measures below.

Segment Information

Search

Search revenue for the third quarter of 2012 was $91.4 million, up 62 percent from the third quarter of 2011. Search revenue reflects strong growth from search distribution, which increased 78 percent over the prior year. Search segment income was $16.4 million, up 51 percent over the third quarter of 2011.

Tax Preparation

Tax Preparation revenue for the third quarter of 2012 was $1.5 million, and segment loss was $1.6 million. Tax preparation typically posts a seasonal loss in the third quarter when there is little revenue from its tax business.

Corporate Operating Expenses

Unallocated corporate operating expenses for the third quarter of 2012 were $2.7 million.

Fourth Quarter Outlook

For the fourth quarter of 2012, the Company expects revenues to be between $92.0 million and $95.0 million, Adjusted EBITDA to be between $10.0 million and $11.0 million, Non-GAAP Net Income to be between $7.7 million and $8.9 million, or $0.18 to 0.21 per diluted share, and Net Income to be between breakeven and $1.0 million, or $0.00 to $0.02 per diluted share. The Company’s forward-looking guidance does not reflect potential gains or losses from derivative instruments.

Conference Call and Webcast

A conference call will be held today at 2 p.m. Pacific time / 5 p.m. Eastern time during which the Company will further discuss third quarter results and its outlook including tax preparation segment guidance for the first half of 2013. The live webcast and supplemental materials are included in a current report on form 8-K and can be accessed in the Investor Relations section of the Blucora corporate website at http://www.blucora.com. A replay of the call will also be available on our website.

###

About Blucora™

Blucora operates two leading Internet businesses. Our InfoSpace business provides online search and monetization solutions to a network of more than 100 partners globally. Through TaxACT, we provide online tax preparation solutions to consumers and professional preparers. The Blucora team brings decades of experience operating and investing in desktop, online, and mobile businesses. We are passionate about the power of the Internet to improve the lives of consumers, and our businesses operate at the forefront of digital migration trends in their respective markets. More information about Blucora may be found at www.blucora.com. Follow and subscribe to us on Twitter, LinkedIn and YouTube.

Source: Blucora, Inc.

Blucora Contact:

Stacy Ybarra, 425-709-8127

stacy.ybarra@blucora.com

This announcement contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Actual results may differ significantly from management’s expectations due to various risks and uncertainties including, but not limited to: general economic, industry, and market sector conditions; the timing and extent of market acceptance of developed products and services and related costs; our dependence on companies to distribute our products and services; the ability to successfully integrate acquired businesses; future acquisitions; the successful execution of the Company’s strategic initiatives, operating plans, and marketing strategies; and the condition of our cash investments. A more detailed description of these and certain other factors that could affect actual results is included in Blucora, Inc.’s most recent Annual Report on Form 10-K and subsequent reports filed with or furnished to the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. Blucora, Inc. undertakes no obligation to update any forward-looking statements to reflect new information, events, or circumstances after the date of this release or to reflect the occurrence of unanticipated events.

Blucora, Inc.

Preliminary Condensed Consolidated Statements of Comprehensive Income (Loss) ⁽¹⁾

(Unaudited)

(Amounts in thousands, except per share data)

	Three months ended						Nine months ended
	September 30, 2012			September 30, 2011			September 30, 2012			September 30, 2011
Revenues	$	92,870		$	56,257		$	309,449		$	162,199
Cost of sales (includes amortization of acquired intangible assets of $2,014, $518, $5,606, and $2,248) (2)		69,973			38,755			193,747			108,008
Gross profit		22,897			17,502			115,702			54,191
Expenses and other loss:
Engineering and technology (2)		2,410			1,806			7,431			5,254
Sales and marketing (2)		7,741			4,888			36,053			16,757
General and administrative (2)		5,283			6,513			21,705			16,643
Depreciation		560			475			1,627			1,689
Amortization of intangible assets		3,169			—			8,450			—
Other loss, net (3)		5,196			456			7,681			274
Total expenses and other loss		24,359			14,138			82,947			40,617
Income (loss) from continuing operations before income taxes		(1,462	)		3,364			32,755			13,574
Income tax expense		(936	)		(1,289	)		(14,049	)		(4,927	)
Income (loss) from continuing operations		(2,398	)		2,075			18,706			8,647
Discontinued operations: (1)
Loss from discontinued operations, net of taxes (2)		—			—			—			(2,253	)
Loss on sale of discontinued operations, net of taxes		—			—			—			(7,674	)
Net income (loss)	$	(2,398	)	$	2,075		$	18,706		$	(1,280	)
Earnings per share - Basic
Income (loss) from continuing operations	$	(0.06	)	$	0.05		$	0.47		$	0.23
Loss from discontinued operations		—			—			—			(0.06	)
Loss on sale of discontinued operations		—			—			—			(0.20	)
Net income (loss) per share - Basic	$	(0.06	)	$	0.05		$	0.47		$	(0.03	)
Earnings per share - Diluted
Income (loss) from continuing operations	$	(0.06	)	$	0.05		$	0.45		$	0.23
Loss from discontinued operations		—			—			—			(0.06	)
Loss on sale of discontinued operations		—			—			—			(0.20	)
Net income (loss) per share - Diluted	$	(0.06	)	$	0.05		$	0.45		$	(0.03	)
Weighted average shares outstanding used in computing basic income (loss) per share		40,511			38,568			40,108			37,451
Weighted average shares outstanding used in computing diluted income (loss) per share		40,511			39,158			41,425			38,131

⁽¹⁾ In the nine months ended September 30, 2011, the Company completed the sale of its Mercantila e-commerce business. The operating results of that business have been presented as discontinued operations for all periods presented. Income taxes related to discontinued operations were a benefit of $1.3 million for the nine months ended September 30, 2011. Income taxes related to discontinued operations were $0.6 million and $0.7 million for the three and nine months ended September 30, 2010, respectively. A loss, net of an income tax benefit of $5.1 million, on the sale of the Mercantila business was recorded for the nine months ended September 30, 2011. Revenue, operating expenses and income taxes, loss from discontinued operations and the loss on sale of these discontinued operations are presented below (in thousands):

	Three months ended				Nine months ended
	September 30, 2012		September 30, 2011		September 30, 2012		September 30, 2011
E-Commerce
Revenue	$	—	$	—			$	16,894
Operating expenses and income taxes		—		—				19,147
Loss from discontinued operations, net of taxes	$	—	$	—	$	—	$	(2,253	)
Loss on sale of discontinued operations, net of taxes	$	—	$	—	$	—	$	(7,674	)

⁽²⁾ In the nine months ended September 30, 2012, $5.2 million in stock-based compensation expense was recorded in association with the modification of the terms of a warrant and the vesting of a non-employee performance-based equity award, which were both triggered by the acquisition of the TaxACT business, and the related expense was allocated to general and administrative expense. Stock-based compensation expense for the three and nine months ended September 30, 2012 and 2011 is allocated among the following captions (in thousands):

	Three months ended				Nine months ended
	September 30, 2012		September 30, 2011		September 30, 2012		September 30, 2011
Stock-Based Compensation
Cost of sales	$	183	$	37	$	331	$	234
Engineering and technology		332		251		894		684
Sales and marketing		587		177		1,389		829
General and administrative		1,093		2,584		8,309		4,673
Discontinued operations		—		—		—		(159	)
Total stock-based compensation expense	$	2,195	$	3,049	$	10,923	$	6,261

⁽³⁾ Other loss, net for the three and nine months ended September 30, 2012 and 2011 is allocated among the following captions (in thousands):

	Three months ended						Nine months ended
	September 30, 2012			September 30, 2011			September 30, 2012			September 30, 2011
Other Loss, Net
Interest expense		794			—			2,647			—
Amortization of debt issuance costs and accretion of debt discount		117			—			1,040			—
Loss on derivative instrument		4,335			—			4,274			—
Gain on contingency resolution		—			—			—			(1,500	)
Increase in fair value of earn-out contingent liability		—			500			—			2,000
Other		(50	)		(44	)		(280	)		(226	)
Total other loss, net	$	5,196		$	456		$	7,681		$	274

Blucora, Inc.

Preliminary Condensed Consolidated Balance Sheets

(Unaudited)

(Amounts in thousands)

	September 30, 2012			December 31, 2011
ASSETS
Current assets:
Cash and cash equivalents	$	96,407		$	81,897
Short-term investments, available-for-sale		54,010			211,654
Accounts receivable, net		35,243			25,019
Other receivables, net		1,274			542
Prepaid expenses and other current assets, net		4,514			1,958
Total current assets		191,448			321,070
Property and equipment, net		6,587			5,277
Goodwill		230,980			44,815
Other intangible assets, net		137,959			1,315
Deferred tax asset, net		19,369			19,102
Other long-term assets		4,382			3,560
Total assets	$	590,725		$	395,139
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	36,954		$	28,947
Accrued expenses and other current liabilities		12,372			10,250
Short-term portion of long-term debt, net of discount of $142		2,233			—
Derivative instruments		10,951			—
Total current liabilities		62,510			39,197
Long-term liabilities:
Long-term debt, net of discount of $517		71,604			—
Deferred tax liability		48,149			21
Other long-term liabilities		2,205			816
Total long-term liabilities		121,958			837
Total liabilities		184,468			40,034
Stockholders’ equity:
Common stock		4			4
Additional paid-in capital		1,386,741			1,353,971
Accumulated deficit		(980,196	)		(998,902	)
Accumulated other comprehensive income (loss)		(292	)		32
Total stockholders’ equity		406,257			355,105
Total liabilities and stockholders’ equity	$	590,725		$	395,139

Blucora, Inc.

Preliminary Condensed Consolidated Statements of Cash Flows

(Unaudited)

(Amounts in thousands)

	Nine months ended
	September 30, 2012			September 30, 2011
Operating activities:
Net income (loss)	$	18,706		$	(1,280	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities of continuing operations:
Loss on sale of discontinued operations		—			7,674
Loss from discontinued operations		—			2,253
Depreciation and amortization of intangible assets		16,950			6,190
Stock-based compensation		6,637			4,488
Warrant-related stock-based compensation		4,286			1,932
Excess tax benefits from stock-based award activity		(20,882	)		—
Deferred income taxes		(7,398	)		2
Unrealized amortization of premium or accretion of discount on investments, net		(335	)		285
Amortization of debt origination costs		746			—
Accretion of debt discount		294			—
Loss on derivative instrument		4,274			—
Earn-out contingent liability adjustments		—			2,000
Gain on resolution of contingent liability		—			(1,500	)
Other		(21	)		(8	)
Changes in operating assets and liabilities:					—
Accounts receivable		(907	)		(882	)
Other receivables		504			(1,118	)
Prepaid expenses and other current assets		705			849
Deferred tax assets and other long-term assets		(612	)		(150	)
Accounts payable		(2,344	)		5,981
Accrued expenses and other current and long-term liabilities		18,357			(13,660	)
Net cash provided by operating activities of continuing operations		38,960			13,056
Investing activities:
Business acquisition, net of cash acquired		(279,386	)		—
Purchases of property and equipment		(2,776	)		(2,507	)
Change in restricted cash		168			409
Proceeds from sales of investments		184,934			—
Proceeds from maturities of investments		32,125			83,141
Purchases of investments		(59,076	)		(204,777	)
Net cash used by investing activities of continuing operations		(124,011	)		(123,734	)
Financing activities:
Proceeds from loan, net of debt issuance costs of $2,343 and debt discount of $953		96,704			—
Proceeds from sale of common stock		—			7,000
Repayment of debt		(25,504	)		—
Excess tax benefits from stock-based award activity		20,882			—
Proceeds from stock option exercises and issuance of stock through employee stock purchase plan		8,413			16,664
Tax payments from shares withheld upon vesting of restricted stock units		(934	)		(1,388	)
Earn-out payments for business acquisition		—			(423	)
Repayment of capital lease obligation		—			(221	)
Net cash provided by financing activities of continuing operations		99,561			21,632
Discontinued operations:
Net cash used by operating activities attributable to discontinued operations		—			(6,156	)
Net cash used by investing activities attributable to discontinued operations		—			(638	)
Net cash used by discontinued operations		—			(6,794	)
Net increase (decrease) in cash and cash equivalents		14,510			(95,840	)
Cash and cash equivalents:
Beginning of period		81,897			155,645
End of period	$	96,407		$	59,805

Blucora, Inc.

Preliminary Segment Information

(Unaudited)

(Amounts in thousands)

	Three months ended						Nine months ended
	September 30, 2012			September 30, 2011			September 30, 2012			September 30, 2011
Search:
Revenue	$	91,408		$	56,257		$	248,511		$	162,199
Cost of revenue (1)		65,203			36,329			176,545			99,031
Operating expenses		9,849			9,119			27,159			29,730
Search segment income		16,356			10,809			44,807			33,438
Search segment margin		18	%		19	%		18	%		21	%
Tax Preparation:
Revenue		1,462			—			60,938			—
Cost of revenue (2)		292			—			4,410			—
Operating expenses		2,731			—			24,000			—
Tax Preparation segment income		(1,561	)		—			32,528			—
Tax Preparation segment margin		-107	%		0	%		53	%		0	%
Total segment:
Total revenue		92,870			56,257			309,449			162,199
Total cost of revenue		65,495			36,329			180,955			99,031
Total segment operating expenses		12,580			9,119			51,159			29,730
Total segment income		14,795			10,809			77,335			33,438
Total segment margin		16	%		19	%		25	%		21	%
Corporate:
Operating expense		2,695			2,307			9,026			6,980
Stock-based compensation		2,195			3,049			10,923			6,420
Depreciation		988			1,115			2,895			3,942
Amortization of intangible assets		5,183			518			14,055			2,248
Other loss, net		5,196			456			7,681			274
Income tax expense		936			1,289			14,049			4,927
Discontinued operations, net of taxes		—			—			—			9,927
Total corporate		17,193			8,734			58,629			34,718
Net income (loss)	$	(2,398	)	$	2,075		$	18,706		$	(1,280	)

⁽¹⁾ Amounts do not include amortization of acquired technology and costs associated with the operation of the Company’s data centers that serve its search business, including depreciation, personnel expenses (including stock-based compensation expense), energy, and bandwidth costs.

⁽²⁾ Amounts do not include amortization of acquired technology and costs associated with the operation of the Company’s data center that serves its tax preparation business, including depreciation, personnel expenses, (including stock-based compensation expense), energy, and bandwidth costs, and personnel costs associated with customer service.

Blucora, Inc.

Reconciliations of Non-GAAP Financial Measures to the Nearest Comparable GAAP Measure

Preliminary Adjusted EBITDA Reconciliation ⁽¹⁾

(Unaudited)

(Amounts in thousands)

	Three months ended					Nine months ended
	September 30, 2012			September 30, 2011		September 30, 2012		September 30, 2011
Net income (loss) (2)	$	(2,398	)	$	2,075	$	18,706	$	(1,280	)
Loss from discontinued operations		—			—		—		9,927
Depreciation and amortization of intangible assets		6,171			1,633		16,950		6,190
Stock-based compensation		2,195			3,049		10,923		6,420
Other loss, net (3)		5,196			456		7,681		274
Income tax expense		936			1,289		14,049		4,927
Adjusted EBITDA (4)	$	12,100		$	8,502	$	68,309	$	26,458

Blucora, Inc.

Reconciliations of Non-GAAP Financial Measures to the Nearest Comparable GAAP Measure

Preliminary Non-GAAP Net Income Reconciliation ⁽¹⁾

(Unaudited)

(Amounts in thousands, except per share amounts)

	Three months ended						Nine months ended
	September 30, 2012			September 30, 2011			September 30, 2012			September 30, 2011
Net income (loss) (2)	$	(2,398	)	$	2,075		$	18,706		$	(1,280	)
Loss from discontinued operations		—			—			—			9,927
Income from continuing operations (2)		(2,398	)		2,075			18,706			8,647
Stock-based compensation		2,195			3,049			10,923			6,420
Amortization of acquired intangible assets		5,183			518			14,055			2,248
Loss on derivatives		4,335			—			4,274			—
Cash tax impact of GAAP adjustments		(15	)		(18	)		(102	)		(60	)
Non-cash income tax expense from continuing operations (1)		1,121			1,221			12,899			4,613
Non-GAAP net income (4)	$	10,421		$	6,845		$	60,755		$	21,868
Per share amounts
Income (loss) from continuing operations - diluted		(0.06	)		0.05			0.45			0.23
Stock-based compensation - diluted		0.05			0.08			0.27			0.16
Amortization of acquired intangible assets - diluted		0.12			0.01			0.34			0.06
Loss on derivatives - diluted		0.11			—			0.10			—
Cash tax impact of GAAP adjustments - diluted		(0.00	)		(0.00	)		(0.00	)		(0.00	)
Non-cash income taxes per share - diluted		0.03			0.03			0.31			0.12
Non-GAAP net income per share - diluted	$	0.25		$	0.17		$	1.47		$	0.57
Weighted average shares outstanding used in computing diluted non-GAAP income per share and its components		42,048			39,158			41,425			38,131

Preliminary Adjusted EBITDA Reconciliation for Forward-Looking Guidance

(Amounts in thousands)

	Ranges for the three months ending December 31, 2012
Net income		—		1,000
Depreciation and amortization of acquired intangible assets		6,300		6,100
Stock-based compensation		2,500		2,200
Other loss, net (4)		1,200		1,000
Income tax expense		—		700
Adjusted EBITDA	$	10,000	$	11,000

Preliminary Non-GAAP Net Income Reconciliation for Forward-Looking Guidance

(Amounts in thousands)

	Ranges for the three months ending December 31, 2012
Net income		—		1,000
Stock-based compensation		2,500		2,200
Amortization of acquired intangible assets		5,200		5,100
Non-cash income tax expense from continuing operations		—		600
Non-GAAP net income	$	7,700	$	8,900

⁽¹⁾ Blucora’s Adjusted EBITDA is calculated by adjusting net income (loss) determined in accordance with generally accepted accounting principles (“GAAP”) to exclude the effects of loss from discontinued operations (which includes loss from discontinued operations, net of taxes, and loss on sale of discontinued operations, net of taxes), income taxes, depreciation, amortization of acquired intangible assets, stock-based compensation expense, and other loss ,net (which includes such items as interest expense, interest income, derivative instrument gains or losses, foreign currency gains or losses, gains or losses from the disposal of assets, adjustments to the fair values of contingent liabilities related to business combinations, and gains on resolutions of contingencies), as detailed above. Blucora’s management believes that Adjusted EBITDA provides meaningful supplemental information regarding the Company’s performance by excluding certain expenses and gains that management believes are not indicative of its core business operating results. Blucora uses this non-GAAP financial measure for internal management purposes, when publicly providing guidance on possible future results, and as a means to evaluate period-to-period comparisons. Blucora believes that Adjusted EBITDA is a common measure used by investors and analysts to evaluate its performance, that it provides a more complete understanding of the results of operations and trends affecting the Company’s business when viewed together with GAAP results, and that management and investors benefit from referring to this non-GAAP financial measure.

Blucora’s Non-GAAP net income and Non-GAAP earnings per share is calculated by adjusting GAAP net income (loss) to exclude the effects of discontinued operations, net of taxes (which includes loss from discontinued operations, net of taxes, and loss on sale of discontinued operations, net of taxes), loss from the sale of discontinued operations, net of taxes, stock-based compensation expense, amortization of acquired intangible assets, gain or loss on derivatives, the cash tax impact of those adjustments to GAAP net income, and non-cash portion of income tax expense from continuing operations, as detailed in the accompanying table to the preliminary condensed consolidated financial statements (unaudited). The Company excludes the non-cash portion of income tax expense because of its ability to offset a substantial portion of its cash tax liabilities by using these deferred tax assets. The majority of these deferred tax assets will expire if unutilized in 2020.

Blucora’s management believes that non-GAAP net income and non-GAAP earnings per share provide meaningful supplemental information to management, investors and analysts regarding the Company’s performance and the valuation of its business by excluding items in the statement of operations that management does not consider part of the Company’s ongoing operations or have not been, or are not expected to be, settled in cash. Additionally, Blucora’s management believes that non-GAAP net income and non-GAAP earnings per share are common measures used by investors and analysts to evaluate the Company’s performance and the valuation of its business.

Adjusted EBITDA, non-GAAP net income and non-GAAP earnings per share should be evaluated in light of the Company’s financial results prepared in accordance with GAAP, and should be considered as a supplement to, and not as a substitute for or superior to, GAAP net income.

⁽²⁾ As presented in the Preliminary Condensed Consolidated Statements of Operations (unaudited).

⁽³⁾ Other loss, net includes such items as interest expense, interest income, derivative instrument gains or losses, foreign currency gains or losses, gains or losses from the disposal of assets, adjustments to the fair values of contingent liabilities related to business combinations, and gains on resolutions of contingencies.

⁽⁴⁾ Other loss, net, primarily consists of interest expense, interest income, foreign currency gains or losses, and gains or losses from the disposal of assets, and the Company’s forward-looking guidance does not reflect potential gains or losses from derivative instruments.

EX-99.2

Exhibit 99.2

Blucora, Inc.

Q3 2012 Earnings

Supplemental Information

Table of Contents

Financial Information
Summary - Consolidated Financial Results	2
Reconciliation of Non-GAAP Financial Measures	4
Search Operating Metrics	5
Pro-Forma Information
Q3 year-over-year Tax Preparation	6
Last 12 Months - Pro Forma Results	7
Last 12 Months - Levered Free Cash Flow	8
Reconciliation Pro Forma Non-GAAP Financial Measures	9

1

Blucora Consolidated Financial Results

(in thousands except earnings per share, rounding differences may exist)

	2010			2011															2012
	FYE 12/31			1Q11			2Q11			3Q11			4Q11			FYE 12/31			1Q12			2Q12			3Q12			3Q12 YTD
Segment Revenue
Search	$	214,343		$	51,650		$	54,292		$	56,257		$	66,615		$	228,814		$	75,295		$	81,808		$	91,408		$	248,511
Tax Preparation (1)		0			0			0			0			0			0			40,401			19,075			1,462			60,938
Total	$	214,343		$	51,650		$	54,292		$	56,257		$	66,615		$	228,814		$	115,696		$	100,883		$	92,870		$	309,449
Segment Income (Loss) (2)
Search	$	49,266		$	11,095		$	11,534		$	10,809		$	12,768		$	46,206		$	13,373		$	15,078		$	16,356		$	44,807
Tax Preparation (1)		0			0			0			0			0			0			22,135			11,954			(1,561	)		32,528
Total	$	49,266		$	11,095		$	11,534		$	10,809		$	12,768		$	46,206		$	35,508		$	27,032		$	14,795		$	77,335
Segment Income (Loss) % of Revenue
Search		23	%		21	%		21	%		19	%		19	%		20	%		18	%		18	%		18	%		18	%
Tax Preparation		na			na			na			na			na			na			55	%		63	%		-107	%		53	%
Total		23	%		21	%		21	%		19	%		19	%		20	%		31	%		27	%		16	%		25	%
Unallocated Corporate Operating Expense	$	16,801		$	2,130		$	2,543		$	2,307		$	2,603		$	9,583		$	3,806	(3)	$	2,525		$	2,695		$	9,026
Adjusted EBITDA	$	32,465		$	8,965		$	8,991		$	8,502		$	10,165		$	36,623		$	31,702		$	24,507		$	12,100		$	68,309
Other Unallocated Corporate
Depreciation	$	6,596		$	1,451		$	1,376		$	1,115		$	919		$	4,861		$	951		$	956		$	988		$	2,895
Amortization of Intangibles		9,197			958			772			518			347			2,595			3,624	(4)		5,248			5,183			14,055
Stock Compensation		13,919			2,033			1,338			3,049			1,267			7,687			6,708	(5)		2,020			2,195			10,923
Other (Income) Expense		(15,244	)		(75	)		(107	)		455			972			1,245			1,555			930			5,196	(6)		7,681
Total	$	14,468		$	4,367		$	3,379		$	5,137		$	3,505		$	16,388		$	12,838		$	9,154		$	13,562		$	35,554
Income (Loss) Before Taxes		17,997			4,598			5,612			3,365			6,660			20,235			18,864			15,353			(1,462	)		32,755
Income Tax
Cash	$	196		$	113		$	133		$	68		$	1,398		$	1,712		$	861		$	474		-$	185		$	1,150
Non-cash (7)		8,530			1,589			1,803			1,221			(17,613	)		(13,000	)		6,597			5,181			1,121			12,899
Total	$	8,726		$	1,702		$	1,936		$	1,289		-$	16,215	(8)	-$	11,288		$	7,458		$	5,655		$	936		$	14,049
Income (Loss) from Continuing Operations		9,271			2,896			3,676			2,076			22,875			31,523			11,406			9,698			(2,398	)		18,706
Discontinued Operations Loss (9)		(4,593	)		(1,573	)		(8,354	)		—			—			(9,927	)		—			—			—			—
GAAP Net Income (Loss)	$	4,678		$	1,323		-$	4,678		$	2,076		$	22,875		$	21,596		$	11,406		$	9,698		-$	2,398		$	18,706
GAAP Earnings Per Share	$	0.13		$	0.04		-$	0.12		$	0.05		$	0.57		$	0.56		$	0.28		$	0.24		-$	0.06		$	0.45
Non-GAAP Net Income	$	40,557		$	7,433		$	7,590		$	6,846		$	6,896		-$	11,195		$	28,517		$	21,817		$	10,421		$	60,755
Non-GAAP Earnings (Loss) Per Share	$	1.10		$	0.20		$	0.20		$	0.17		$	0.17		-$	0.29		$	0.70		$	0.53		$	0.26		$	1.47
Outstanding Shares		36,089			36,502			37,964			39,323			39,534			39,534			39,804			40,334			40,633			40,633
Basic Shares		35,886			36,339			37,422			38,568			39,448			37,954			39,692			40,116			40,511			40,108
Fully-diluted Shares		36,829			37,084			38,128			39,158			40,074			38,621			40,978			41,245			40,511			41,425
Cash & Short-term Investment	$	253,736		$	249,765		$	263,402		$	279,276		$	293,551		$	293,551		$	129,868		$	141,867		$	150,417		$	150,417
Outstanding Debt		0			0			0			0			0			0			85,000			75,000			74,496			74,496
Net Cash	$	253,736		$	249,765		$	263,402		$	279,276		$	293,551		$	293,551		$	44,868		$	66,867		$	75,921		$	75,921

Notes to Consolidated Financial Results on next page

2

Notes to Consolidated Financial Results

⁽¹⁾ On January 31, 2012, the Company acquired TaxACT Holdings, Inc. and its wholly-owned subsidiary, 2^nd Story Software, Inc., which operates the TaxACT tax preparation software and online service and software business. The TaxACT business consists of an online tax preparation service for individuals, tax preparation software for individuals and professional tax preparers, and ancillary data storage services. The majority of the TaxACT business’s revenue is generated by the online service at www.taxact.com. As a highly seasonal business, almost all of the TaxACT revenue is generated in the first four months of the calendar year. Amounts represent the results of operations for the TaxACT business from February 1, 2012 to September 30, 2012.

⁽²⁾ The Company does not allocate certain general, administrative, and overhead costs, or stock-based compensation, depreciation, amortization of intangible assets, other loss (income), net, income tax expense, or results from discontinued operations to the reportable segments. The general, administrative and overhead costs are included in Unallocated Corporate Operating Expense.

⁽³⁾ Amount for the quarter ended March 31, 2012 includes $1.1 million in transaction costs related to the TaxACT acquisition.

⁽⁴⁾ Amount for the quarter ended March 31, 2012 includes $3.4 million related to amortization of acquired intangible assets related to the TaxACT acquisition.

⁽⁵⁾ In the quarter ended September 30, 2011, $1.9 million in stock-based compensation expense was recorded in association with issuance of a warrant. In the quarter ended March 31, 2012, $5.2 million in stock-based compensation expense was recorded in association with the modification of the terms of a warrant and the vesting of a non-employee performance-based equity award, which were both triggered by the acquisition of the TaxACT business.

⁽⁶⁾ Amount includes $4.3 million related to loss on derivative.

⁽⁷⁾ Amounts represent the non-cash portion of income tax expense from continuing operations. The Company excludes the non-cash portion of income tax expense because of its ability to offset a substantial portion of its cash tax liabilities by using these deferred tax assets. The majority of these deferred tax assets will expire if unutilized in 2020.

⁽⁸⁾ Amount includes a tax benefit of $19.6 million, due to the release of the valuation allowance on deferred tax assets.

⁽⁹⁾ In the quarter ended June 30, 2011, the Company completed the sale of its Mercantila e-commerce business. The operating results of that business have been presented as discontinued operations for all periods presented.

3

Blucora Non-GAAP Reconciliation ⁽¹⁾

(in thousands except earnings per share, rounding differences may exist)

	2010			2011															2012
	FYE 12/31			1Q11			2Q11			3Q11			4Q11			FYE 12/31			1Q12			2Q12			3Q12			3Q12 YTD
Adjusted EBITDA
Net Income (loss) (2)	$	4,678		$	1,323		$	(4,678	)	$	2,076		$	22,875		$	21,596		$	11,406		$	9,698		$	(2,398	)	$	18,706
Discontinued operations		4,593			1,573			8,354			—			—			9,927			—			—			—			—
Depreciation		6,596			1,451			1,376			1,115			919			4,861			951			956			988			2,895
Amortization of intangible assets		9,197			958			772			518			347			2,595			3,624			5,248			5,183			14,055
Stock-based compensation		13,919			2,033			1,338			3,049			1,267			7,687			6,708			2,020			2,195			10,923
Other (income) loss (3)		(15,244	)		(75	)		(107	)		455			972			1,245			1,555			930			5,196			7,681
Income tax expense (benefit)		8,726			1,702			1,936			1,289			(16,215	)		(11,288	)		7,458			5,655			936			14,049
Adjusted EBITDA	$	32,465		$	8,965		$	8,991		$	8,502		$	10,165		$	36,623		$	31,702		$	24,507		$	12,100		$	68,309
Non-GAAP Net Income
Net Income (2)	$	4,678		$	1,323		$	(4,678	)	$	2,076		$	22,875		$	21,596		$	11,406		$	9,698		$	(2,398	)	$	18,706
Discontinued operations		4,593			1,573			8,354			—			—			9,927			—			—			—			—
Amortization of acquired intangible assets		9,197			958			772			518			347			2,595			3,624			5,248			5,183			14,055
Stock-based compensation		13,919			2,033			1,338			3,049			1,267			7,687			6,708			2,020			2,195			10,923
Loss / (Gain) on derivative		—			—			—			—			—			—			272			(333	)		4,335			4,274
Cash tax impacts of GAAP adjustments		(360	)		(43	)		1			(18	)		20			(40	)		(90	)		3			(15	)		(102	)
Non-cash income tax expenses (benefit) from continuing operations (1)		8,530			1,589			1,803			1,221			(17,613	)		(13,000	)		6,597			5,181			1,121			12,899
Non-GAAP net income (4)	$	40,557		$	7,433		$	7,590		$	6,846		$	6,896		$	28,765		$	28,517		$	21,817		$	10,421		$	60,755
Non-GAAP Earnings Per Share
Non-GAAP Net Income	$	40,557		$	7,433		$	7,590		$	6,846		$	6,896		$	28,765		$	28,517		$	21,817		$	10,421		$	60,755
Non-GAAP Earnings Per Share (4)	$	1.10		$	0.20		$	0.20		$	0.17		$	0.17		$	0.74		$	0.70		$	0.53		$	0.26		$	1.47
Fully-diluted Shares		36,829			37,084			38,128			39,158			40,074			38,621			40,978			41,245			40,511			41,425

⁽¹⁾ For definitions of these non-GAAP financial measures and their relationship to the Company’s GAAP financial statements, please see Note 1 to the Company’s Reconciliations of Non-GAAP financial Measures to the Nearest Comparable GAAP Measure for the three months ended September 30, 2012 and 2011 in exhibit 99.1 to this Current Report on Form 8-K filed on November 1, 2012

⁽²⁾ As presented in the Preliminary Condensed Consolidated Statements of Operations (unaudited).

⁽³⁾ Other loss (income), net includes such items as interest expense, interest income, derivative instrument gains or losses, foreign currency gains or losses, gains or losses from the disposal of assets, adjustments to the fair values of contingent liabilities related to business combinations, gains on resolutions of contingencies and litigation settlements.

⁽⁴⁾ Amounts previously disclosed have been revised to reflect the effect of classifying the Company’s Mercantila e-commerce business as discontinued operations.

4

Blucora Operating Metrics - Search

	2010			2011															2012
	FYE 12/31			1Q11			2Q11			3Q11			4Q11			FYE 12/31			1Q12			2Q12			3Q12			3Q12 YTD
Revenue by Source
Owned & Operated (B2C)		31	%		27	%		22	%		19	%		16	%		21	%		13	%		12	%		12	%		12	%
Distribution (B2B)		69	%		73	%		78	%		81	%		84	%		79	%		87	%		88	%		88	%		88	%

* Owned & Operated includes revenue from the Make The Web Better acquisition in 2Q 2010; the installed base has experienced attrition since the acquisition. Owned & Operated also includes other development-stage initiatives.

5

Tax Preparation Segment - Pro Forma 3Q Year-over-Year Results

(in thousands, rounding differences may exist)

	Three Months Ended									Nine months ended
	(a) 3Q12			3Q11			Growth			(c) 3Q12			3Q11			Growth
Pro Forma Revenue	$	2,075		$	2,004			4	%	$	83,829		$	76,577			9	%
Pro Forma Segment Income	$	(948	)	$	(435	)(b)		118	%	$	42,411		$	38,685	(d)		10	%
Segment Margin		-46	%		-22	%					51	%		51	%

^(a) Includes $613,000 of revenue not reported on a GAAP basis due to fair value purchase accounting on deferred revenue at date of acquisition.

^(b) Excludes $3.6 million of non-operational expenses related to a non-consummated sales transaction for 3Q 2011.

^(c) Includes $2.0M of revenue not reported on a GAAP basis due to fair value purchase accounting on deferred revenue at date of acquisition.

^(d) Excludes $120,000 and $6.4M of non-operational expenses related to a non-consummated sales transaction for the nine months ended 3Q 2012 and 3Q 2011, respectively.

Tax Preparation Segment - Pro Forma Calendar Quarter Historical Performance

(in thousands, rounding differences may exist)

	1Q11			2Q11			3Q11			4Q11			FY 2011			1Q12
Pro Forma Revenue	$	56,758		$	17,815		$	2,004		$	2,205		$	78,782		$	61,944
Pro Forma Segment Income (c)	$	28,564		$	10,556		$	(435	)	$	(1,134	)	$	37,551		$	30,577
Segment Margin		50	%		59	%		-22	%		-51	%		48	%		49	%

^(c) Excludes $1.1 million, $1.8 million, $3.6 million, $2.9 million and $9.3 million of non-operational expenses related to a non-consummated sales transaction for 1Q 2011, 2Q 2011, 3Q 2011, 4Q 2011 and full-year 2011.

6

Pro Forma - Consolidated Financial Performance

twelve months ending 9/30/2012

(in thousands, rounding differences may exist)

	(a) Tax Preparation			Search		Corporate			Consolidated
Revenue	$	86,032		$	315,126	$	—		$	401,158
Segment income	$	41,184	(b)	$	57,575	$	—		$	98,759
Unallocated Corporate expenses	$	—		$	—	$	(11,617	)	$	(11,617	)
Adjusted EBITDA									$	87,142
Non-GAAP Net Income									$	76,045
Non-GAAP Earnings Per Share									$	1.73
Diluted Shares for the twelve-month period ended September 30, 2012										41,087

^(a) Includes $2.0M of revenue not reported on a GAAP basis due to fair value purchase accounting on deferred revenue at date of acquisition in 2012, and $23.1M revenue prior to the acquisition (October 2011 - January 2012).

^(b) Includes $2.0M of revenue which was not reported on a GAAP basis due to fair value purchase accounting on deferred revenue in 2012 and excludes $3.0M of Transaction expenses related to the failed HRB acquisition

7

Pro-Forma Free Cash Flow (“FCF”)

twelve months ending 9/30/2012

(in thousands, rounding differences may exist)

Pro Forma Adjusted EBITDA	$	87,142
Less - Pro Forma Capital Expenditures	$	(3,050	)
Less - Pro Forma Cash Taxes	$	(1,043	)
Unlevered FCF	$	83,049
Less - Pro Forma Cash Interest Expense	$	(4,329	)(a)
Levered FCF	$	78,720

^(a) Interest expense estimated at 5% and assumes initial debt amount of $100 million for periods prior to acquisition; as of September 30, 2012 there is $74.5M of debt outstanding.

8

Blucora Pro Forma Non-GAAP Reconciliation

twelve months ending 9/30/2012

(in thousands except rates, rounding differences may exist)

Pro Forma Adjusted EBITDA
Pro forma income from continuing operations	$	23,695
Pro forma depreciation	$	4,071
Pro forma amortization of intangible assets	$	21,111
Pro forma stock-based compensation	$	12,526
Pro forma other expense, net	$	10,353
Pro forma income tax expense	$	15,386
Pro Forma Adjusted EBITDA	$	87,142
Pro Forma Non-GAAP Net Income
Pro forma income from continuing operations	$	23,695
Pro forma amortization of acquired intangible assets	$	12,526
Pro forma stock-based compensation	$	21,111
Loss on derivative	$	4,274
Pro forma cash tax impact of GAAP adjustments	$	97
Pro forma non-cash income tax expense from continuing operations	$	14,343
Pro forma non-GAAP net income	$	76,045
Pro forma non-GAAP Earnings per share - diluted	$	1.85
Weighted average diluted shares		41,087

⁽¹⁾ For definitions of these non-GAAP financial measures and their relationship to the Company’s GAAP financial statements, please see Note 1 to the Company’s Reconciliations of Non-GAAP financial Measures to the Nearest Comparable GAAP Measure for the three months ended September 30, 2012 and 2011 in exhibit 99.1 to this Current Report on Form 8-K filed on November 1, 2012.

9