Source: https://investor.brightcove.com/node/11811/html
Timestamp: 2020-07-03 16:42:01
Document Index: 666561703

Matched Legal Cases: ['§1836', '§42', '§11', '§1836', '§42', '§11']

As of July 23, 2018 there were 35,917,891 shares of the registrant’s common stock, $0.001 par value per share, outstanding.
Accounts receivable, net of allowance of $121 and $146 at June 30, 2018 and December 31, 2017, respectively
5,639 3,991
7,359 3,045
Common stock, $0.001 par value; 100,000,000 shares authorized; 36,052,891 and 34,933,408 shares issued at June 30, 2018 and December 31, 2017, respectively
35,543,307 34,247,058 35,234,974 34,152,109
(320 ) 77 (73 ) 257
$ (5,972 ) $ (7,601 ) $ (7,982 ) $ (12,494 )
The Company is headquartered in Boston, Massachusetts and was incorporated in the state of Delaware on August 24, 2004. At June 30, 2018, the Company had nine wholly-owned subsidiaries: Brightcove UK Ltd, Brightcove Singapore Pte. Ltd., Brightcove Korea, Brightcove Australia Pty Ltd, Brightcove Holdings, Inc., Brightcove Kabushiki Kaisha (Brightcove KK), Zencoder Inc. (Zencoder), Brightcove FZ-LLC, and Cacti Acquisition LLC.
The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, other than the changes resulting from adopting new revenue recognition guidance which also impacted the accounting for the costs to obtain a contract as described in Note 2, the unaudited condensed consolidated financial statements and notes have been prepared on the same basis as the audited consolidated financial statements for the year ended December 31, 2017 contained in the Company’s Annual Report on Form 10-K and include all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of the Company’s financial position for the three and six months ended June 30, 2018 and 2017. These interim periods are not necessarily indicative of the results to be expected for any other interim period or the full year.
The accompanying condensed consolidated financial statements reflect the application of certain significant accounting policies as described below and elsewhere in these notes to the condensed consolidated financial statements. As of June 30, 2018, other than the changes to revenue recognition as described in Note 2, the Company’s significant accounting policies and estimates, which are detailed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017, have not changed.
The following table summarizes revenue from contracts with customers by business unit for the three and six months ended June 30, 2018.
$ 22,402 $ 45,374
18,081 35,061
1,171 2,413
41,654 82,848
The following tables compare the reported condensed consolidated balance sheet, statement of operations and cash flows, as of and for the three and six months ended June 30, 2018, to the pro-forma amounts had the previous guidance been in effect.
$ 27,453 27,453
25,908 25,184
5,639 5,639
7,359 2,315
66,359 60,591
9,927 9,927
2,211 941
$ 136,252 $ 129,214
$ 7,309 $ 7,309
13,744 13,744
41,886 40,893
62,974 61,981
64,155 63,142
246,417 246,417
(172,603 ) (178,628 )
72,097 66,072
Total reported assets were $7,038 greater than the pro-forma balance sheet, which assumes the previous guidance remained in effect as of June 30, 2018. This was largely due to impacts of variable consideration and costs to obtain a contract.
Total reported liabilities were $1,013 greater than the pro-forma balance sheet, which assumes the previous guidance remained in effect as of June 30, 2018. This was largely due to the impact of variable consideration.
The following summarizes the significant changes on the Company’s condensed consolidated statement of operations for the three months and six months ended June 30, 2018 as a result of the adoption of ASC 606 on January 1, 2018 compared to if the Company had continued to recognize revenues under ASC 605.
As reported Pro forma as if
guidance was in
effect As reported Pro forma as if
$ 37,867 $ 37,809 $ 75,734 $ 75,722
3,787 3,787 7,114 7,114
41,654 41,596 82,848 82,836
13,125 13,125 26,581 26,581
3,493 3,493 7,248 7,248
16,618 16,618 33,829 33,829
25,036 24,978 49,019 49,007
7,743 7,743 15,518 15,518
15,265 15,394 28,499 28,907
7,045 7,045 12,435 12,435
30,053 30,182 56,452 56,860
(5,017 ) (5,204 ) (7,433 ) (7,853 )
(481 ) (481 ) (210 ) (210 )
(5,498 ) (5,685 ) (7,643 ) (8,063 )
154 154 266 266
$ (5,652 ) $ (5,839 ) $ (7,909 ) $ (8,329 )
$ (0.16 ) $ (0.16 ) $ (0.22 ) $ (0.24 )
35,543,307 35,543,307 35,234,974 35,234,974
The primary difference in subscription and support revenue relates to the impacts of applying the variable consideration guidance under ASC 606. Under the previous guidance, subscription and support revenue would have been approximately $58 and $12 lower, respectively, for the three and six months ended June 30, 2018 as revenue for usage based fees, for contracts with annual entitlement allowances, was recognized in the month of such usage. Under ASC 606, usage based fees, for contracts with annual entitlement allowances, are recognized as revenue over the term of the underlying arrangement.
Sales and marketing expense, under the previous guidance, would have increased by approximately $129 and $408, respectively, for the three and six months ended June 30, 2018, due to a portion of the commission payments being recorded immediately to expense at the time a liability was recorded. In addition, certain commission amounts that were amortized to expense over the underlying term of the arrangement are now amortized over the average customer life under ASC 606.
The net impact of accounting for revenue under the new guidance had no impact on net loss per share for the three months ended June 30, 2018 and increased net loss per share by $0.02 per basic and diluted share the six months ended June 30, 2018.
$ (7,909 ) $ (8,329 )
(488 ) (688 )
(276 ) 16
812 1,342
25,908 1,881 41,886 137 42,023
Revenue recognized during the six months ended June 30, 2018 from amounts included in deferred revenue at the beginning of the period was approximately $31.5 million. During the six months ended June 30, 2018, the Company did not recognize revenue from performance obligations satisfied or partially satisfied in previous periods.
The assets recognized for costs to obtain a contract were $5.8 million and $5.4 million as of June 30, 2018 and January 1, 2018, respectively. Amortization expense recognized during the three and six months ended June 30, 2018 related to costs to obtain a contract was $2.0 million and $3.8 million, respectively.
As of June 30, 2018, the total aggregate transaction price allocated to the unsatisfied performance obligations for subscription and support contracts was approximately $109.4 million, of which approximately $86.3 million is expected to be recognized over the next 12 months. The Company expects to recognize substantially all of the remaining unsatisfied performance obligations by the end of 2020. The Company applied the practical expedient to not disclose the amount of transaction price allocated to unsatisfied performance obligations for variable consideration that the Company is able to allocate to one or more of the performance obligations in its contracts.
At June 30, 2018 and December 31, 2017, no individual customer accounted for 10% or more of accounts receivable, net. For the three and six months ended June 30, 2018 and 2017, no individual customer accounted for 10% or more of total revenue.
The Company considers all highly liquid investments with an original maturity of three months or less at the date of purchase to be cash equivalents. Management determines the appropriate classification of investments at the time of purchase, and re-evaluates such determination at each balance sheet date. The Company did not have any short-term or long-term investments at June 30, 2018 or December 31, 2017.
Cash and cash equivalents as of June 30, 2018 consist of the following:
Demand $ 19,235 $ 19,235 $ 19,235
Demand 8,218 8,218 8,218
$ 27,453 $ 27,453 $ 27,453
3,656 4,117 3,710 4,147
2,458 1,857 2,330 1,860
The following tables set forth the Company’s financial instruments carried at fair value using the lowest level of input as of June 30, 2018 and December 31, 2017:
$ 8,218 $ — $ — $ 8,218
6.1 5.6 6.1 6.0
2.88 % 1.80 % 2.87 % 2.04 %
43 % 42 % 43 % 43 %
$ 4.27 $ 2.45 $ 4.22 $ 3.13
The Company recorded stock-based compensation expense of $1,832 and $1,686 for the three months ended June 30, 2018 and 2017, respectively, and $3,500 and $3,476 for the six months ended June 30, 2018 and 2017, respectively. As of June 30, 2018, there was $18,308 of unrecognized stock-based compensation expense related to stock-based awards that is expected to be recognized over a weighted-average period of 2.60 years.
During the quarter ended June 30, 2018, the Company granted 445,000 restricted stock units to certain key executives, including the 400,000 restricted stock units to the CEO under the 2018 Plan. These restricted stock units contain both performance-based and service-based vesting conditions. The Company measures compensation expense for these performance-based awards based upon a review of the Company’s expected achievement against specified financial performance targets. Compensation cost is recognized on a ratable basis over the requisite service period for each series of grants to the extent management has deemed that such awards are probable of vesting based upon the expected achievement against the specified targets. On a periodic basis, management reviews the Company’s expected performance and adjusts the compensation cost, if needed, at such time.
The following is a summary of the status of the Company’s stock options as of June 30, 2018 and the stock option activity during the six months ended June 30, 2018.
952,090 9.21
(936,340 ) 4.51 $ 4,501
(570,070 ) 8.10
3,369,993 $ 8.52 7.03 $ 5,240
1,661,323 $ 8.73 5.14 $ 2,621
(1) The aggregate intrinsic value was calculated based on the positive difference between the fair value of the Company’s common stock on June 30, 2018 of $9.65 per share, or the date of exercise, as appropriate, and the exercise price of the underlying options.
The following table summarizes the restricted stock unit activity, including the restricted stock units with performance-based vesting, during the six months ended June 30, 2018:
875,705 8.88
(183,143 ) 6.97
(340,041 ) 7.44
Unvested by June 30, 2018
2,571,225 $ 8.07
For the three months ended June 30, 2018 and 2017, the Company recorded income tax expense of $154 and $108, respectively. For the six months ended June 30, 2018 and 2017, the Company recorded income tax expense of $266 and $187 respectively. The income tax expense relates principally to the Company’s foreign operations.
The Company has evaluated the positive and negative evidence bearing upon the realizability of its U.S. net deferred tax assets. As required by the provisions of Accounting Standards Codification (“ASC”) 740, Income Taxes, management has determined that it is more-likely-than-not that the Company will not utilize the benefits of federal and state U.S. net deferred tax assets for financial reporting purposes. Accordingly, the net deferred tax assets are subject to a valuation allowance at June 30, 2018 and December 31, 2017. Based on the level of historical income in Japan and future projections, the Company believes it is probable it will realize the benefits of its future deductible differences. As such, the Company has not recorded a valuation allowance against its net deferred tax assets in Japan as of June 30, 2018 and December 31, 2017. The Company’s income tax return reporting periods since December 31, 2012 are open to income tax audit examination by the federal and state tax authorities. In addition, because the Company has net operating loss carryforwards, the Internal Revenue Service is permitted to audit earlier years and propose adjustments up to the amount of net operating losses generated in those years. There are currently no federal, state or foreign audits in progress.
As of June 30, 2018, the Company had not yet completed its accounting for all of the tax effects of the enactment of the Act; however, the Company has made a reasonable estimate of the effects on its existing deferred tax balances and the one-time transition tax. The Company will continue to refine its calculations as additional analysis is completed. The Company expects that any additional changes will be offset by an increase or decrease in the Company’s valuation allowance as any transition tax will result in use of the net operating loss deferred tax asset, which is fully offset by a valuation allowance along with all other net deferred tax assets.
On May 22, 2017, a lawsuit was filed against Brightcove and two individuals by Ooyala, Inc. (“Ooyala”) and Ooyala Mexico S. de R.L. de C.V. (“Ooyala Mexico”). The lawsuit, which was filed in the United States District Court for the District of Massachusetts, concerns allegations that the two individuals, who are former employees of Ooyala Mexico, misappropriated customer information and other trade secrets and used that information in working for Brightcove. The complaint was amended on June 1, 2017 to remove claims against the two former employees of Ooyala Mexico. The remaining claims against Brightcove are for violation of the Defend Trade Secrets Act of 2016 (18 U.S.C. §1836), violation of the Massachusetts trade secret statute (M.G.L. c. 93, §42), violation of Massachusetts Chapter 93A (M.G.L. c. 93A, §11), and tortious interference with advantageous business relationships. Ooyala and Ooyala Mexico also filed a motion for preliminary injunction (amended at the same time the complaint was amended), seeking to enjoin Brightcove from using any of the allegedly misappropriated information or communicating with customers whose information was allegedly taken, and seeking the return of any information that was taken. On June 16, 2017, Brightcove filed an opposition to the motion for preliminary injunction, and also moved to dismiss the lawsuit. Brightcove’s motion to dismiss was denied on September 6, 2017. The court issued a preliminary injunction on July 10, 2018. The injunction requires Brightcove to delete any Ooyala confidential information obtained from the former Ooyala employees and prohibits Brightcove from using such information to pursue business with twenty-two specified Latin American prospective customers. The parties are now engaged in discovery. The Company cannot yet determine whether it is probable that a loss will be incurred in connection with this complaint, nor can the Company reasonably estimate the potential loss, if any.
The Company typically enters into indemnification agreements in the ordinary course of business. Pursuant to these agreements, the Company indemnifies and agrees to reimburse the indemnified party for losses and costs incurred by the indemnified party, generally the Company’s customers, in connection with patent, copyright, trade secret, or other intellectual property or personal right infringement claim by third parties with respect to the Company’s technology. The term of these indemnification agreements is generally perpetual after execution of the agreement. Based on when customers first subscribe for the Company’s service, the maximum potential amount of future payments the Company could be required to make under certain of these indemnification agreements is unlimited, however, more recently the Company has typically limited the maximum potential value of such potential future payments in relation to the value of the contract. Based on historical experience and information known as of June 30, 2018, the Company has not incurred any costs for the above guarantees and indemnities. The Company has received requests for indemnification from customers in connection with patent infringement suits brought against the customer by a third party. To date, the Company has not agreed that the requested indemnification is required by the Company’s contract with any such customer.
On November 19, 2015, the Company entered into an amended and restated loan and security agreement with a lender (the “Loan Agreement”) providing for up to a $20.0 million asset-based line of credit (the “Line of Credit”) with an expiration date of November 11, 2018. Under the Line of Credit, the Company can borrow up to $20.0 million. Borrowings under the Line of Credit are secured by substantially all of the Company’s assets, excluding intellectual property. Outstanding amounts under the Line of Credit accrue interest at a rate equal to the prime rate or the LIBOR rate plus 2.5%. Under the Loan Agreement, the Company must comply with certain financial covenants, including maintaining a minimum asset coverage ratio. If the outstanding principal during any month is at least $15.0 million, the Company must also maintain a minimum net income threshold based on non-GAAP operating measures. Failure to comply with these covenants, or the occurrence of an event of default, could permit the lender under the Line of Credit to declare all amounts borrowed under the Line of Credit, together with accrued interest and fees, to be immediately due and payable. The Company was in compliance with all covenants under the Line of Credit as of June 30, 2018. As the Company has not drawn on the Line of Credit, there are no amounts outstanding as of June 30, 2018.
$ 22,839 $ 22,080 $ 45,517 $ 45,479
6,734 6,113 13,047 12,080
5,468 4,518 10,855 8,287
6,456 5,906 13,167 10,127
157 136 262 352
$ 41,654 $ 38,753 $ 82,848 $ 76,325
North America is comprised of revenue from the United States, Canada and Mexico. Revenue from customers located in the United States was $21,570 and $20,585 during the three months ended June 30, 2018 and 2017, respectively, and $42,824 and $42,613 during the six months ended June 30, 2018 and 2017, respectively. Other than the United States and Japan, no other country contributed more than 10% of the Company’s total revenue during the three and six months ended June 30, 2018 and 2017.
As of June 30, 2018 and December 31, 2017, property and equipment at locations outside the U.S. was not material.
In May 2017 the FASB issued ASU 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting. ASU 2017-09 provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. ASU 2017-09 is effective for financial statements issued for annual reporting periods beginning after December 15, 2017 and interim periods within those years. Earlier application is permitted. The adoption of ASU 2017-09 did not have a material effect on the Company’s consolidated financial statements and related disclosures.
On December 22, 2017, the Tax Cuts and Jobs Act (the “Act”) was enacted in the United States. The Act reduces the U.S. federal corporate tax rate from 34% to 21%, requires companies to pay a one-time transition tax on earnings of certain foreign subsidiaries that were previously tax deferred and creates new taxes on certain foreign sourced earnings. In December 2017, the SEC issued guidance under SAB No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act directing taxpayers to consider the impact of the U.S. legislation as “provisional” when it does not have the necessary information available, prepared or analyzed (including computations) in reasonable detail to complete its accounting for the change in tax law. As of June 30, 2018, the Company had not yet completed its accounting for all of the tax effects of the enactment of the Act; however, the Company has made a reasonable estimate of the effects on our existing deferred tax balances and one-time transition tax. Refer to Note 9, Income Taxes, for additional information regarding this new tax legislation.
In addition to the reduction in the federal corporate tax rate and the one-time transition tax, which the Company has accounted for with provisional estimates at June 30, 2018, the Company continues to analyze the provisions of tax reform that become effective for the Company in 2018 including the provisions related to Global Intangible Low Taxed Income, Foreign Derived Intangible Income, Base Erosion Anti-Abuse Tax, as well as other provisions which would limit the deductibility of future expenses.
As of June 30, 2018, we had 494 employees and 3,936 customers, of which 1,732 used our volume offerings and 2,204 used our premium offerings. As of June 30, 2017, we had 513 employees and 4,304 customers, of which 2,225 used our volume offerings and 2,079 used our premium offerings.
We generate revenue by offering our products to customers on subscription-based, software as a service, or SaaS, model. Our revenue grew from $76.3 million in the six months ended June 30, 2017 to $82.8 million in the six months ended June 30, 2018, primarily related to an increase in sales of Video Cloud to both new and existing customers. Our consolidated net loss was $7.9 million and $12.8 million for the six months ended June 30, 2018 and 2017, respectively. Included in consolidated net loss for the six months ended June 30, 2018 was stock-based compensation expense and amortization of acquired intangible assets of $3.5 million and $1.3 million, respectively. Included in consolidated net loss for the six months ended June 30, 2017 was stock-based compensation expense and amortization of acquired intangible assets of $3.5 million and $1.4 million, respectively.
For the six months ended June 30, 2018 and 2017, our revenue derived from customers located outside North America was 45% and 40%, respectively. We expect the percentage of total net revenue derived from outside North America to increase in future periods as we continue to expand our international operations.
As of June 30, 2018, we had 3,936 customers, of which 1,732 used our volume offerings and 2,204 used our premium offerings. As of June 30, 2017, we had 4,304 customers, of which 2,225 used our volume offerings and 2,079 used our premium offerings. Our go-to-market focus and growth strategy is to expand our premium customer base, as we believe our premium customers represent a greater opportunity for our solutions. Volume customers decreased in recent periods primarily due to our discontinuation of the promotional Video Cloud Express offering. As a result, we have experienced attrition of this base level offering without a corresponding addition of customers. We expect customers using our volume offerings to continue to decrease in 2018 and beyond as we continue to focus on the market for our premium solutions.
• Recurring Dollar Retention Rate. We assess our ability to retain customers using a metric we refer to as our recurring dollar retention rate. We calculate the recurring dollar retention rate by dividing the retained recurring value of subscription revenue for a period by the previous recurring value of subscription revenue for the same period. We define retained recurring value of subscription revenue as the committed subscription fees for all contracts that renew in a given period, including any increase or decrease in contract value. We define previous recurring value of subscription revenue as the recurring value from committed subscription fees for all contracts that expire in that same period. We typically calculate our recurring dollar retention rate on a monthly basis. Recurring dollar retention rate provides visibility into our ongoing revenue. During the six months ended June 30, 2018 and 2017, the recurring dollar retention rate was 99% and 88%, respectively.
1,732 2,225
2,204 2,079
3,936 4,304
99 % 88 %
$ 74.9 $ 68.9
$ 4.9 $ 5.1
Cost of revenue increased in absolute dollars from the first six months of 2017 to the first six months of 2018. In future periods we expect our cost of revenue will increase in absolute dollars as our revenue increases. Cost of revenue as a percentage of revenue could fluctuate from period to period depending on the growth of our professional services business and any associated costs relating to the delivery of subscription services and the timing of significant expenditures. To the extent that our customer base grows, we intend to continue to invest additional resources in expanding the delivery capability of our products and other services. The timing of these additional expenses could affect our cost of revenue, both in terms of absolute dollars and as a percentage of revenue, in any particular quarterly or annual period.
As part of the process of preparing our consolidated financial statements, we are required to estimate our taxes in each of the jurisdictions in which we operate. We account for income taxes in accordance with the asset and liability method. Under this method, deferred tax assets and liabilities are recognized based on temporary differences between the financial reporting and income tax bases of assets and liabilities using statutory rates. In addition, this method requires a valuation allowance against net deferred tax assets if, based upon the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. We have provided a valuation allowance against our existing net deferred tax assets as of June 30, 2018 and as of December 31, 2017, with the exception of the deferred tax assets related to Brightcove KK.
Our cost of revenue, research and development, sales and marketing, and general and administrative expenses include stock-based compensation expense. Stock-based compensation expense represents the fair value of outstanding stock options and restricted stock awards, which is recognized as expense over the respective stock option and restricted stock award service periods. For both the six months ended June 30, 2018 and 2017, we recorded $3.5 million of stock-based compensation expense. We expect stock-based compensation expense to increase in absolute dollars in future periods.
With regard to our international operations, we frequently enter into transactions in currencies other than the U.S. dollar. As a result, our revenue, expenses and cash flows are subject to fluctuations due to changes in foreign currency exchange rates, particularly changes in the euro, British pound, Australian dollar, and Japanese yen. For the three months ended June 30, 2018 and 2017, 48% and 47%, respectively, of our revenue was generated in locations outside the United States. For the six months ended June 30, 2018 and 2017, 48% and 44%, respectively, of our revenue was generated in locations outside the United States. During the three months ended June 30, 2018 and 2017, 32% and 29%, respectively, of our revenue was in currencies other than the U.S. dollar, as were some of the associated expenses. During the six months ended June 30, 2018 and 2017, 31% and 28% respectively, of our revenue was in currencies other than the U.S. dollar, as were some of the associated expenses. In periods when the U.S. dollar declines in value as compared to the foreign currencies in which we conduct business, our foreign currency-based revenue and expenses generally increase in value when translated into U.S. dollars. We expect our foreign currency-based revenue to remain relatively unchanged in absolute dollars and as a percentage of total revenue.
Total revenue increased by $2.9 million, or 7%, in the three months ended June 30, 2018 compared to the three months ended June 30, 2017 due to an increase in subscription and support revenue of 7%, or $2.3 million, and an increase in professional services and other revenue of 17%, or $562,000. The increase in subscription and support revenue was primarily related to the continued growth of our customer base for our premium offerings including sales to both new and existing customers. The increase in professional services revenue was primarily related to the size and number of professional services engagements during the three months ended June 30, 2018, compared to the corresponding quarter in the prior year. In addition, our revenue from premium offerings grew by $3.2 million, or 9%, in the three months ended June 30, 2018, compared to the three months ended June 30, 2017. Our ability to continue to provide the product functionality and performance that our customers require will be a major factor in our ability to continue to increase revenue.
Our gross profit increased by $2.9 million, or 13%, in the three months ended June 30, 2018 compared to the three months ended June 30, 2017, primarily due to an increase in revenue. Our ability to continue to maintain our overall gross profit will depend primarily on our ability to continue controlling our costs of delivery.
Loss from operations was $5.0 million in the three months ended June 30, 2018 compared to $7.9 million in the three months ended June 30, 2017. Loss from operations in the three months ended June 30, 2018 included stock-based compensation expense and amortization of acquired intangible assets of $1.8 million and $674,000, respectively. Loss from operations in the three months ended June 30, 2017 included stock-based compensation expense and amortization of acquired intangible assets of $1.7 million and $674,000, respectively. We expect our operating losses to decrease due to increased sales to both new and existing customers and from improved efficiencies throughout our organization as we continue to grow and scale our operations.
As of June 30, 2018, we had $27.5 million of unrestricted cash and cash equivalents, an increase of $1.3 million from $26.1 million at December 31, 2017, due primarily to $4.2 million in proceeds from exercises of stock options and $254,000 of cash provided by operating activities. These increases were offset in part by $1.8 million in capitalization of internal-use software costs, $958,000 in capital expenditures, $193,000 in payments under capital lease obligations and $113,000 in payments of withholding tax on RSU vesting.
$ 40,483 97 % $ 37,295 96 % $ 3,188 9 %
1,171 3 1,458 4 (287 ) (20 )
$ 41,654 100 % $ 38,753 100 % $ 2,901 7 %
During the three months ended June 30, 2018, revenue increased by $2.9 million, or 7%, compared to the three months ended June 30, 2017, primarily due to an increase in revenue from our premium offerings, which consists of subscription and support revenue. The increase in premium revenue of $3.2 million, or 9%, is partially the result of a 6% increase in the number of premium customers from 2,079 at June 30, 2017 to 2,204 at June 30, 2018 and a 9% increase in the average annual subscription revenue per premium customer during the three months ended June 30, 2018. In the three months ended June 30, 2018, volume revenue decreased by $287,000, or 20%, compared to the three months ended June 30, 2017, as we continue to focus on the market for our premium solutions.
$ 37,867 91 % $ 35,528 92 % $ 2,339 7 %
3,787 9 3,225 8 562 17
In the three months ended June 30, 2018, subscription and support revenue increased by $2.3 million, or 7%, compared to the three months ended June 30, 2017. The increase was primarily related to the continued growth of our customer base for our premium offerings including sales to both new and existing customers and a 9% increase in the average annual subscription revenue per premium customer during the three months ended June 30, 2018. In addition, professional services and other revenue increased by $562,000, or 17% compared to the three months ended June 30, 2017. Professional services and other revenue will vary from period to period depending on the number of implementations and other projects that are in process.
$ 22,839 55 % $ 22,080 57 % $ 759 3 %
6,734 16 6,113 16 621 10
5,468 14 4,518 12 950 21
6,456 15 5,906 15 550 9
157 — 136 — 21 15
18,815 45 16,673 43 2,142 13
In the three months ended June 30, 2018, total revenue for North America increased $759,000, or 3%, compared to the three months ended June 30, 2017. In the three months ended June 30, 2018, total revenue outside of North America increased $2.1 million, or 13%, compared to the three months ended June 30, 2017.
$ 13,125 35 % $ 13,102 37 % $ 23 — %
3,493 92 3,476 108 17 —
$ 16,618 40 % $ 16,578 43 % $ 40 — %
In the three months ended June 30, 2018, cost of subscription and support revenue remained relatively unchanged, compared to the three months ended June 30, 2017. There were increases in network hosting, partner commissions, and employee- related expenses of $400,000, $334,000 and $305,000 respectively. There were also increases in third-party software integrated with our service offering and amortization expense of $179,000 and $162,000, respectively. These increases were partially offset by decreases in content delivery network and depreciation expenses of $1.1 million and $288,000, respectively.
In the three months ended June 30, 2018, cost of professional services and other revenue remained relatively unchanged, compared to the three months ended June 30, 2017. There was an increase in employee-related expense of $147,000. This increase was partially offset by decreases in travel and consulting expenses of and $99,000 and $97,000 respectively.
$ 24,742 65 % $ 22,426 63 % $ 2,316 10 %
294 8 (251 ) (8 ) 545 217
$ 25,036 60 % $ 22,175 57 % $ 2,861 13 %
The overall gross profit percentage was 60% and 57% for the three months ended June 30, 2018 and 2017, respectively. Subscription and support gross profit increased $2.3 million, or 10%, compared to the three months ended June 30, 2017. Professional services and other gross profit increased $545,000, or 217%, compared to the three months ended June 30, 2017. It is likely that gross profit, as a percentage of revenue, will fluctuate quarter by quarter due to the timing and mix of subscription and support revenue and professional services and other revenue, and the type, timing and duration of service required in delivering certain projects.
$ 7,743 19 % $ 8,279 21 % $ (536 ) (6 )%
15,265 37 15,904 41 (639 ) (4 )
7,045 17 5,876 15 1,169 20
$ 30,053 72 % $ 30,059 78 % $ (6 ) — %
Research and Development. In the three months ended June 30, 2018, research and development expense decreased by $536,000, or 6%, compared to the three months ended June 30, 2017 primarily due to decreases in employee-related and travel expenses of $390,000 and $96,000, respectively. We expect our research and development expense to remain relatively unchanged in future periods.
Sales and Marketing. In the three months ended June 30, 2018, sales and marketing expense decreased by $639,000, or 4%, compared to the three months ended June 30, 2017 primarily due to decreases in travel, employee-related, and commission expenses of $792,000, $397,000 and $160,000, respectively. These decreases were partially offset by increases in marketing programs, stock-based compensation expense and rent expense of $422,000, $266,000 and $142,000 respectively. Sales and marketing expense during the three months ended June 30, 2018 include costs associated with our annual user conference in addition to certain other annual marketing events. As a result, we expect sales and marketing expense to decrease for the remaining periods of 2018.
General and Administrative. In the three months ended June 30, 2018, general and administrative expense increased by $1.2 million, or 20%, compared to the three months ended June 30, 2017 primarily due to increases in executive severance, consulting, and employee-related expense of $735,000, $355,000, and $320,000 respectively. There were also increases in recruiting and bad debt expense of $255,000 and $139,000 respectively. These increases were partially offset by decreases in audit, legal and stock-based compensation expense of $291,000, $164,000 and $99,000 respectively. We expect general and administrative expense to remain relatively unchanged in future periods.
$ 57 — % $ 32 — % $ 25 78 %
(1 ) — (7 ) — 6 (86 )
(537 ) (1 ) 289 1 (826 ) (286 )
$ (481 ) (1 )% $ 314 — % $ (795 ) (253 )%
In the three months ended June 30, 2018, interest income, net, increased by $25,000, or 78%, compared to the corresponding period of the prior year.
The interest expense during the three months ended June 30, 2018 is primarily comprised of interest paid on capital leases. The increase in other (expense) income net during the three months ended June 30, 2018 was primarily due to realized foreign currency exchange gains recorded during the three months ended June 30, 2018 compared to losses recorded in the corresponding period of the prior year.
$ 154 — % $ 108 — % $ 46 43 %
In the three months ended June 30, 2018 and 2017, the provision for income taxes was primarily comprised of income tax expenses related to foreign jurisdictions.
Overview of Results of Operations for the Six Months End June 30, 2018 and 2017
Total revenue increased by $6.5 million, or 9%, in the six months ended June 30, 2018 compared to the six months ended June 30, 2017 due largely to an increase in subscription and support revenue of $6.0 million, or 9%. The increase in subscription and support revenue was primarily related to continued growth of our customer base for our premium offerings including sales to both new and existing customers. Professional services and other revenue increased by $559,000, or 9%, during six months ended June 30, 2018, compared to the corresponding period in the prior year. The increase in professional services and other revenue was primarily related to the size and number of professional services engagements during the six months ended June 30, 2018, compared to the corresponding period in the prior year. In addition, our revenue from premium offerings grew by $7.1 million, or 10%, in the six months ended June 30, 2018, compared to the six months ended June 30, 2017 primarily due to a 6% increase in the number of premium customers from 2,079 at June 30, 2017 to 2,204 at June 30, 2018.
Our gross profit increased by $4.5 million, or 10%, in the six months ended June 30, 2018 compared to the six months ended June 30, 2017, primarily due to an increase in revenue.
Loss from operations was $7.4 million in the six months ended June 30, 2018 compared to $13.0 million in the six months ended June 30, 2017. Loss from operations in the six months ended June 30, 2018 included stock-based compensation expense and amortization of acquired intangible assets of $3.5 million and $1.3 million, respectively. Loss from operations in the six months ended June 30, 2017 included stock-based compensation expense and amortization of acquired intangible assets of $3.5 million and $1.4 million respectively.
$ 80,435 97 % $ 73,357 96 % $ 7,078 10 %
2,413 3 2,968 4 (555 ) (19 )
$ 82,848 100 % $ 76,325 100 % $ 6,523 9 %
During the six months ended June 30, 2018, revenue increased by $6.5 million, or 9%, compared to the six months ended June 30, 2017, primarily due to an increase in revenue from our premium offerings, which consists of subscription and support revenue, as well as professional services and other revenue. The increase in premium revenue of $7.1 million, or 10%, is partially the result of a 6% increase in the number of premium customers from 2,079 at June 30, 2017 to 2,204 at June 30, 2018, in addition to a $559,000, or 9%, increase in professional services revenue. In the six months ended June 30, 2018, volume revenue decreased by $555,000, or 19%, compared to the six months ended June 30, 2017, as we continue to focus on the market for our premium solutions.
$ 75,734 91 % $ 69,770 91 % $ 5,964 9 %
7,114 9 6,555 9 559 9
In the six months ended June 30, 2018, subscription and support revenue increased by $6.0 million, or 9% primarily related to the continued growth of our customer base for our premium offerings including sales to both new and existing customers and an 9% increase in the average annual subscription revenue per premium customer during the six months ended June 30, 2018. In addition, professional services and other revenue increased by $559,000, or 9%, primarily related to the size and number of professional services engagements during the six months ended June 30, 2018 compared to the corresponding quarter in the prior year. Professional services and other revenue will vary from period to period depending on the number of implementations and other projects that are in process.
$ 45,517 55 % $ 45,479 60 % $ 38 — %
13,047 16 12,080 16 967 8
10,855 13 8,287 11 2,568 31
13,167 16 10,127 13 3,040 30
262 — 352 — (90 ) (26 )
37,331 45 30,846 40 6,485 21
In the six months ended June 30, 2018, total revenue for North America remaining relatively unchanged compared to the six months ended June 30, 2017. In the six months ended June 30, 2018, total revenue outside of North America increased $6.5 million, or 21%, compared to the six months ended June 30, 2017. The increase in revenue from international regions is primarily related to an increase in revenue in Asia Pacific and Japan.
$ 26,581 35 % $ 25,256 36 % $ 1,325 5 %
7,248 102 6,540 100 708 11
$ 33,829 41 % $ 31,796 42 % $ 2,033 6 %
In the six months ended June 30, 2018, cost of subscription and support revenue increased $1.3 million, or 5%, compared to the six months ended June 30, 2017. The increase resulted primarily from increases in network hosting services, partner commission expense and employee-related expense of $1.0 million and $580,000 and $550,000 respectively. There were also increases in amortization, third-party software integrated with our service offering, and rent expenses of $423,000, $183,000, and $173,000, respectively. These increases were partially offset by decreases in content delivery network and depreciation expenses of $1.0 million and $499,000 respectively.
In the six months ended June 30, 2018, cost of professional services and other revenue increased $708,000, or 11%, compared to the six months ended June 30, 2017. This increase resulted primarily from increases in consulting and employee-related expenses of $400,000 and 330,000 respectively. These increases were offset in part by a decrease in travel expense of $140,000.
$ 49,153 65 % $ 44,514 64 % $ 4,639 10 %
(134 ) (2 ) 15 — (149 ) nm
$ 49,019 59 % $ 44,529 58 % $ 4,490 10 %
The overall gross profit percentage was 59% and 58% for the six months ended June 30, 2018 and 2017, respectively. Subscription and support gross profit increased $4.6 million, or 10%, compared to the six months ended June 30, 2017. In addition, professional services and other gross profit decreased $149,000 compared to the six months ended June 30, 2017 due to the increase in mix of contractor expenses versus internal expenses in order to support various professional services projects. It is likely that gross profit, as a percentage of revenue, will fluctuate quarter by quarter due to the timing and mix of subscription and support revenue and professional services and other revenue, and the type, timing and duration of service required in delivering certain projects.
$ 15,518 19 % $ 16,473 22 % $ (955 ) (6 )%
28,499 34 29,805 39 (1,306 ) (4 )
12,435 15 11,267 15 1,168 10
$ 56,452 68 % $ 57,545 75 % $ (1,093 ) (2 )%
Research and Development. In the six months ended June 30, 2018, research and development expense decreased by $955,000, or 6%, compared to the six months ended June 30, 2017 primarily due to decreases in employee-related, travel, consulting and stock-based compensation expenses of $458,000, $183,000, $145,000 and $99,000 respectively. These decreases were partially offset by an increase in rent expense of $100,000.
Sales and Marketing. In the six months ended June 30, 2018, sales and marketing expense decreased by $1.3 million, or 4%, compared to the six months ended June 30, 2017 primarily due to travel, employee-related, and consulting expenses of $1.4 million, $288,000 and $179,000, respectively. These decreases were partially offset by increases in rent, conference, and stock-based compensation expenses of $345,000, $242,000 and $185,000 respectively.
General and Administrative. In the six months ended June 30, 2018, general and administrative expense increased by $1.2 million, or 10%, compared to the six months ended June 30, 2017 primarily due to increases in executive severance, employee-related, consulting and recruiting expenses of $735,000, $614,000, $423,000 and $316,000, respectively. These increases were offset in part by decreases in audit, travel and legal expenses of $350,000, $172,000 and $169,000, respectively.
$ 104 — % $ 62 — % $ 42 68 %
(3 ) — (17 ) — 14 (82 )
(311 ) — 407 1 (718 ) (176 )
$ (210 ) — % $ 452 1 % $ (662 ) (146 )%
In the six months ended June 30, 2018, interest income, net, increased by $42,000, or 68%, compared to the corresponding period of the prior year.
The interest expense during the six months ended June 30, 2018 is primarily comprised of interest paid on capital leases and an equipment financing. The increase in other (expense) income, net during the six months ended June 30, 2018 was primarily due to foreign currency exchange gains recorded during the six months ended June 30, 2018 upon collection of foreign denominated accounts receivable, compared to losses recorded in the corresponding period of the prior year.
$ 266 — % $ 187 — % $ 79 42 %
In the six months ended June 30, 2018 and 2017, the provision for income taxes was primarily comprised of income tax expenses related to foreign jurisdictions.
$ (958 ) $ (650 )
Our cash and cash equivalents at June 30, 2018 were held for working capital purposes and were invested primarily in money market funds. We do not enter into investments for trading or speculative purposes. At June 30, 2018 and December 31, 2017, we had $9.2 million and $7.8 million, respectively, of cash and cash equivalents held by subsidiaries in international locations, including subsidiaries located in Japan and the United Kingdom. As a result of changes in tax law, these earnings can be repatriated to the United States tax-free but will still be subject to foreign withholding taxes. The Company is still in the process of analyzing the impact of the Tax Cuts and Jobs Act on its indefinite reinvestment assertion. We believe that our existing cash and cash equivalents will be sufficient to meet our anticipated working capital and capital expenditure needs over at least the next 12 months.
Our accounts receivable balance fluctuates from period to period, which affects our cash flow from operating activities. The fluctuations vary depending on the timing of our billing activity and cash collections. In many instances we receive cash payment from a customer prior to the time we are able to recognize revenue on a transaction. We record these payments as deferred revenue, which has a positive effect on our accounts receivable balances. We use days’ sales outstanding, or DSO, calculated on a quarterly basis, as a measurement of the quality and status of our receivables. We define DSO as (a) accounts receivable, net of allowance for doubtful accounts, divided by total revenue for the most recent quarter, multiplied by (b) the number of days in that quarter. DSO was 57 days at June 30, 2018 and 59 days at December 31, 2017.
Cash provided (used in) by operating activities consists primarily of net loss adjusted for certain non-cash items including depreciation and amortization, stock-based compensation expense, the provision for bad debts and the effect of changes in working capital and other activities. Cash provided by operating activities during the six months ended June 30, 2018 was $254,000. The cash flow provided by operating activities primarily resulted from net non-cash charges of $7.0 million, and cash provided by changes in our operating assets and liabilities of $1.2 million, partially offset by net losses of $7.9 million. Net non-cash expenses consisted of $3.5 million for stock-based compensation expense and $3.4 million for depreciation and amortization expense. Cash provided from changes in our operating assets and liabilities consisted primarily of increases in accounts payable and deferred revenue of $924,000 and $812,000, respectively, and a decrease in accounts receivable of $296,000. These inflows were offset in part by increases in prepaid expenses and other assets of $488,000 and $276,000, respectively, and a decrease in accrued expenses of $62,000.
Cash used in investing activities during the six months ended June 30, 2018 was $2.8 million, consisting primarily of $1.8 million for the capitalization of internal-use software costs and $958,000 in capital expenditures to support the business.
Cash provided by financing activities for the six months ended June 30, 2018 was $3.9 million, consisting of proceeds received on the exercise of common stock options of $4.2 million offset in part by payments under capital lease obligation, payments of withholding tax on RSU vesting, and equipment financing of $193,000, $113,000 and $26,000, respectively.
On November 19, 2015, we entered into an amended and restated loan and security agreement with a lender (the “Loan Agreement”) providing for up to a $20.0 million asset based line of credit (the “Line of Credit”) with an expiration date of November 11, 2018. Under the Line of Credit, we can borrow up to $20.0 million. Borrowings under the Line of Credit are secured by substantially all of our assets, excluding our intellectual property. Outstanding amounts under the Line of Credit accrue interest at a rate equal to the prime rate or the LIBOR rate plus 2.5%. Under the Loan Agreement, we must comply with certain financial covenants, including maintaining a minimum asset coverage ratio. If the outstanding principal during any month is at least $15.0 million, the Company must also maintain a minimum net income threshold based on non-GAAP operating measures. Failure to comply with these covenants, or the occurrence of an event of default, could permit the Lenders under the Line of Credit to declare all amounts borrowed under the Line of Credit, together with accrued interest and fees, to be immediately due and payable. We were in compliance with all covenants under the Line of Credit as of June 30, 2018.
As of December 31, 2017, we had federal and state net operating losses of approximately $161.9 million and $66.7 million, respectively, which are available to offset future taxable income, if any, through 2037. We had federal and state research and development tax credits of $6.1 million and $3.9 million, respectively, which expire in various amounts through 2037. Our net
operating loss and tax credit amounts are subject to annual limitations under Section 382 change of ownership rules of the U.S. Internal Revenue Code of 1986, as amended. We completed an assessment to determine whether there may have been a Section 382 ownership change and determined that it is more likely than not that our net operating and tax credit amounts as disclosed are not subject to any material Section 382 limitations.
In assessing our ability to utilize our net deferred tax assets, we considered whether it is more likely than not that some portion or all of our net deferred tax assets will not be realized. Based upon the level of our historical U.S. losses and future projections over the period in which the net deferred tax assets are deductible, at this time, we believe it is more likely than not that we will not realize the benefits of these deductible differences. Accordingly, we have provided a valuation allowance against our U.S. deferred tax assets as of June 30, 2018 and December 31, 2017.
Our contractual obligations as of December 31, 2017 are summarized in our Annual Report on Form 10-K for the year ended December 31, 2017. In addition to the obligations outlined in our Annual Report on Form 10-K, we entered into an agreement to lease office space in Sydney, Australia with a non-cancelable commitment with total obligations of $1.2 million through June 30, 2023. As of June 30, 2018, our obligation was $1.2 million in connection with this agreement.
In June 2018, we entered into an agreement with a non-cancelable commitment, primarily for content delivery and network storage services, with obligations of $18.0 million through April 30, 2020. As of June 30, 2018, our obligation was $16.4 million in connection with this agreement.
(1) Percentage of revenues and expenses denominated in foreign currency for the three and six months ended June 30, 2018 and 2017:
32 % 16 % 29 % 14 %
31 % 15 % 28 % 14 %
As of June 30, 2018 and December 31, 2017, we had $6.8 million and $7.3 million, respectively, of receivables denominated in currencies other than the U.S. dollar. We also maintain cash accounts denominated in currencies other than the local currency, which exposes us to foreign exchange rate movements.
Currently, our largest foreign currency exposures are the euro, British pound and Japanese yen, primarily because our European and Japanese operations have a higher proportion of our local currency denominated expenses. Relative to foreign currency exposures existing at June 30, 2018, a 10% unfavorable movement in foreign currency exchange rates would expose us to losses in earnings or cash flows or significantly diminish the fair value of our foreign currency financial instruments. For the six months ended June 30, 2018, we estimated that a 10% unfavorable movement in foreign currency exchange rates would have decreased revenues by $2.6 million, decreased expenses by $1.5 million and decreased operating income by $1.1 million. The estimates used assume that all
currencies move in the same direction at the same time and the ratio of non-U.S. dollar denominated revenue and expenses to U.S. dollar denominated revenue and expenses does not change from current levels. Since a portion of our revenue is deferred revenue that is recorded at different foreign currency exchange rates, the impact to revenue of a change in foreign currency exchange rates is recognized over time, and the impact to expenses is more immediate, as expenses are recognized at the current foreign currency exchange rate in effect at the time the expense is incurred. All of the potential changes noted above are based on sensitivity analyses performed on our financial results as of June 30, 2018.
We had unrestricted cash and cash equivalents totaling $27.5 million at June 30, 2018. Cash and cash equivalents were invested primarily in money market funds and are held for working capital purposes. We do not use derivative financial instruments in our investment portfolio. Declines in interest rates, however, would reduce future interest income. We incurred $1,000 and $7,000 of interest expense during the three months ended June 30, 2018 and 2017, respectively, and $3,000 and $17,000 of interest expense during the six months ended June 30, 2018 and 2017, respectively, related to interest paid on capital leases. While we continue to incur interest expense in connection with our capital leases, the interest expense is fixed and not subject to changes in market interest rates. In the event that we borrow under our line of credit, which bears interest at the prime rate or the LIBOR rate plus the LIBOR rate margin, the related interest expense recorded would be subject to changes in the rate of interest.
As of June 30, 2018, our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of June 30, 2018, our disclosure controls and procedures were effective in ensuring that material information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, including ensuring that such material information is accumulated by and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.
On May 22, 2017, a lawsuit was filed against us and two individuals by Ooyala, Inc. (“Ooyala”) and Ooyala Mexico S. de R.L. de C.V. (“Ooyala Mexico”). The lawsuit, which was filed in the United States District Court for the District of Massachusetts, concerns allegations that the two individuals, who are former employees of Ooyala Mexico, misappropriated customer information and other trade secrets and used that information in working for Brightcove. The complaint was amended on June 1, 2017 to remove claims against the two former employees of Ooyala Mexico. The remaining claims against us are for violation of the Defend Trade Secrets Act of 2016 (18 U.S.C. §1836), violation of the Massachusetts trade secret statute (M.G.L. c. 93, §42), violation of Massachusetts Chapter 93A (M.G.L. c. 93A, §11), and tortious interference with advantageous business relationships. Ooyala and Ooyala Mexico also filed a motion for preliminary injunction (amended at the same time the complaint was amended), seeking to enjoin us from using any of the allegedly misappropriated information or communicating with customers whose information was taken, and seeking the return of any information that was allegedly taken. On June 16, 2017, we filed an opposition to the motion for preliminary injunction, and also moved to dismiss the lawsuit. Brightcove’s motion to dismiss was denied on September 6, 2017.
The court issued a preliminary injunction on July 10, 2018. The injunction requires us to delete any Ooyala confidential information obtained from the former Ooyala employees and prohibits us from using such information to pursue business with twenty-two specified Latin American prospective customers. We are now engaged in discovery. We cannot yet determine whether it is probable that a loss will be incurred in connection with this complaint, nor can we reasonably estimate the potential loss, if any.
10.1 (7)** Amendment to Employment Agreement, dated April 11, 2018, by and between the Registrant and Andrew Feinberg.
10.2 (8)** Employment Agreement, dated April 11, 2018, by and between the Registrant and Jeff Ray.
10.3 (9)** Non-Employee Director Compensation Policy of Brightcove Inc. dated April 11, 2018.
10.4 (10)** Employment Agreement dated May 3, 2018, by and between the Registrant and Robert Noreck.
(4) Filed as Exhibit 4.4 to Registrant’s Registration Statement on Form S-8 filed with the Securities and Exchange Commission on May 1, 2018, and incorporated herein by reference.
(5) Filed as Exhibit 4.5 to Registrant’s Registration Statement on Form S-8 filed with the Securities and Exchange Commission on May 1, 2018, and incorporated herein by reference.
(6) Filed as Exhibit 4.6 to Registrant’s Registration Statement on Form S-8 filed with the Securities and Exchange Commission on May 1, 2018, and incorporated herein by reference.
(7) Filed as Exhibit 99.1 to Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on April 11, 2018, and incorporated herein by reference.
(8) Filed as Exhibit 99.2 to Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on April 11, 2018, and incorporated herein by reference.
(9) Filed as Exhibit 99.5 to Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on April 11, 2018, and incorporated herein by reference.
(10) Filed as Exhibit 99.1 to Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on May 4, 2018, and incorporated herein by reference.
In connection with the Quarterly Report on Form 10-Q of Brightcove Inc. for the quarterly period ended June 30, 2018 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Jeff Ray, as Chief Executive Officer of Brightcove Inc., hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Brightcove Inc.
In connection with the Quarterly Report on Form 10-Q of Brightcove Inc. for the quarterly period ended June 30, 2018 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Robert Noreck, as Chief Financial Officer of Brightcove Inc., hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Brightcove Inc.