Millennial Media Reports 2013 Third Quarter Results

  Millennial Media Reports 2013 Third Quarter Results

Pro Forma Combined Revenue $86.3 Million

Business Wire

BALTIMORE -- November 13, 2013

Millennial Media, Inc.(NYSE:MM), the independent leader in mobile
advertising, today reported financial results for the third quarter
endedSeptember 30, 2013.

Financial Results and Business Highlights for theThird Quarterof 2013

Revenue:For the third quarter of 2013, pro forma combined revenue increased
to$86.3 million– above the high end of our guidance – from $62.0 millionfor
the third quarter of 2012 on a comparable basis, a year over year increase of
39.2%. For 3Q 2013 the $86.3 million pro forma combined revenue is comprised
of $56.1 million from Millennial Media standalone and $30.2 million from
Jumptap, and for 3Q 2012 is comprised of $47.4 million from Millennial Media
and $14.6 million from Jumptap. Jumptap results for 3Q 2013 are preliminary.

Gross Margin:For the third quarter of 2013, pro forma combined gross margin
was 38.6% compared to a pro forma combined gross margin of 40.3% for the third
quarter of 2012. For 3Q 2013, Millennial Media’s standalone gross margin was
39.6% and Jumptap’s was 36.4%, and standalone gross margin for 3Q 2012 for
Millennial Media was 40.9% and 38.3% for Jumptap.

Adjusted EBITDA:For the third quarter of 2013, adjusted EBITDA, a non-GAAP
financial measure, was$808 thousand on a pro forma combined basis, also above
our guidance, compared to adjusted EBITDA (loss) of $(548) thousand pro forma
combined for the third quarter of 2012 on a comparable basis. For 3Q 2013 the
$808 thousand pro forma combined adjusted EBITDA is comprised of $220 thousand
from Millennial Media standalone and $588 thousand from Jumptap.

Net Income (Loss):For the third quarter of 2013, standalone net income
(loss), on a GAAP basis, was $(4.6)million, compared to net income (loss)
of$(1.8) millionfor the third quarter of 2012.

Net Income (Loss) Per Share Attributable to Common Stockholders:For the third
quarter of 2013, on a standalone GAAP basis, basic and diluted net income
(loss) per share attributable to common stockholders was$(0.06), compared to
basic and diluted net income (loss) per share attributable to common
stockholders of$(0.02)for the third quarter of 2012.

Non-GAAP Net Income (Loss) Per Common Share:For the third quarter of 2013,
standalone non-GAAP net income (loss) per common share was$0.00, compared to
non-GAAP net income (loss) per common share of$0.03for the third quarter of
2012.

Other Business Metrics:As of September 30, 2013,Millennial Mediaon a
standalone basis reached over 500 million monthly unique users globally,
including approximately 170 million monthly unique users inthe United
Statesalone. As ofSeptember 30, 2013, more than 49,000 apps were enabled by
mobile app developers to operate on Millennial Media’s platform, and there
were more than 480 million proprietary, anonymous user profiles developed.

“We’ve made substantial progress building and strengthening our full-stack
mobile advertising platform this year,” saidPaul Palmieri, Millennial Media’s
President and CEO. “Through our acquisition of Jumptap, the global launch of
MMX, our mobile ad exchange, and the introduction of our Omni Measurement
suite, we are uniquely positioned to be the partner of choice to the world’s
largest advertisers and agencies.”

“In the third quarter we generated $86 million in combined pro forma revenues
driven by strong brand and international results and growth in programmatic
performance revenues via the newly acquired Jumptap capabilities. Our
integration is going well and we are very enthusiastic about bringing our
combined capabilities to the global mobile advertising market.”

Outlook

Based on information available as of the date of this release,Millennial
Mediaexpects total pro forma combined revenue for the fourth quarter of 2013
to be in the range of$95 million to $100 millionand expects pro forma
combined adjusted EBITDA to be between breakeven and $2 millionin the fourth
quarter. Pro forma combined revenue and adjusted EBITDA are calculated as the
sum of the expected Millennial Media and Jumptap results for the entire fourth
quarter, with an adjustment for any expected intercompany revenue. For GAAP
purposes, we began to combine revenue for the fourth quarter as of November 7,
2013.

Non-GAAP Financial Measures

To supplement its consolidated financial statements, which are prepared and
presented in accordance with U.S. generally accepted accounting principles
(“GAAP”), Millennial Media reports adjusted EBITDA and non-GAAP net income
(loss) per common share basic and diluted, which are non-GAAP financial
measures. We define adjusted EBITDA as net income (loss) before interest,
income taxes, depreciation, amortization, non-cash stock-based compensation
and expenses related to acquisitions, such as costs for services of lawyers,
investment bankers, accountants, and other third parties, and accrual of
retention payments that represent contingent compensation to be recognized as
expense over a requisite service period. The outlook we provided above for
expected adjusted EBITDA for the fourth quarter of 2013 also excludes expected
acquisition-related severance costs and retention bonuses. We define non-GAAP
net income (loss) per common share as adjusted EBITDA divided by diluted
weighted average common shares outstanding. The Company uses these non-GAAP
financial measures for financial and operational decision making and as a
means to evaluate period-to-period comparisons. The Company believes that
these measures provide useful information about operating results, enhances
the overall understanding of past financial performance and future prospects,
and allows for greater transparency with respect to key metrics used by
management in its financial and operational decision making. Non-GAAP
financial measures should be considered in addition to results and guidance
prepared in accordance with GAAP, but should not be considered a substitute
for, or superior to, GAAP results. The non-GAAP financial measures included in
this press release have been reconciled to the nearest GAAP measure in the
tables following the financial statements attached to this press release.

Third Quarter 2013 Financial Results Conference Call: Millennial Media will
host a conference call today at 5:00 p.m. ET to discuss its third quarter 2013
financial results, developments in its business, and the Company’s
expectations for the fourth quarter 2013. A live webcast of the event will be
available on the Investor Relations page of the Millennial Media website at
http://investors.millennialmedia.com. A live domestic dial-in is available at
866-700-6293 (U.S.) or 617-213-8835 (international) using passcode 88255794.
If you are unable to listen to the live conference call, a replay will be
available through November 20, 2013, and can be accessed by dialing
888-286-8010 (U.S.) or 617-801-6888 (international) using passcode 15389664.
An archived version of the webcast will also be available at
http://investors.millennialmedia.com.

About Millennial Media

Millennial Media is the leading independent audience platform in digital
advertising. The company’s mobile-first approach to audience targeting helps
brands connect to consumers in powerful ways and helps developers maximize
their revenue. Its robust cross-screen targeting capabilities, enabled by its
unique data asset and full technology stack, deliver meaningful results for
advertisers and developers.

Forward-Looking Statements

The statements in this press release that are not historical facts constitute
“forward-looking statements” that involve risks and uncertainties and are made
pursuant to the Private Securities Litigation Reform Act of 1995. These
forward-looking statements include expectations regarding financial results
for the fourth quarter of 2013. The achievement or success of the matters
covered by such forward-looking statements involve risks, uncertainties and
assumptions, and if any such risks or uncertainties materialize or if any of
the assumptions prove incorrect, our results could differ materially from the
results expressed or implied by the forward-looking statements we make. These
risks and uncertainties include, but are not limited to, risks associated with
our ability to expand our developer and advertiser base, keep pace with
technological and market developments and remain competitive against larger
companies in our industry as well as potential new entrants into our markets,
and risks regarding our recent acquisition of Jumptap, including our ability
to integrate the two businesses and realize the expected benefits from the
acquisition.Further information on these and other factors that could affect
our results is included in our Quarterly Report on Form 10-Q that will be
filed for the quarter ended September 30, 2013 and other filings we make with
the Securities and Exchange Commission from time to time. These documents are
available on the ‘SEC Filings’ section of the Investor Relations page of our
website at http://investors.millennialmedia.com.

The statements made in this release are based on information available to us
as of the date of this release, and we assume no obligation and do not intend
to update these forward-looking statements, except as required by law.


Millennial Media,Inc.

Consolidated Balance Sheets

(in thousands, except share and per share data)
                                                               
                                                  September 30,   December 31,
                                                  2013            2012
Assets                                            (unaudited)
Current assets:
Cash and cash equivalents                         $ 121,200       $ 137,439
Accounts receivable, net of allowances of
$3,487 and $2,673 as of September 30, 2013
and December 31, 2012, respectively               58,521          59,179
Prepaid expenses and other current assets         3,502           1,966
Total current assets                              183,223         198,584
                                                                  
Long-term assets:
Property and equipment, net                       8,199           6,850
Goodwill                                          11,124          1,348
Intangible assets, net                            2,660           913
Other assets                                      1,060           754
Total long-term assets                            23,043          9,865
Total assets                                      $ 206,266       $ 208,449
                                                                  
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable and accrued expenses             $ 6,616         $ 3,788
Accrued cost of revenue                           33,848          34,430
Accrued payroll and payroll related expenses      5,151           6,038
Deferred revenue                                  486             169
Total current liabilities                         46,101          44,425
                                                                  
Other long-term liabilities                       275             243
Total liabilities                                 46,376          44,668
                                                                  
Stockholders’ equity:
Preferred stock, $0.001 par value, 5,000,000
shares authorized, no shares issued and
outstanding as of September 30, 2013 and          –               –
December 31, 2012
Common stock, $0.001 par value, 250,000,000
shares authorized, 81,445,671 and 79,182,913
shares
issued and outstanding as of September 30, 2013   81              79
and December 31, 2012, respectively
Additional paid-in capital                        221,432         213,823
Accumulated other comprehensive loss              (170)           (78)
Accumulated deficit                               (61,453)        (50,043)
Total stockholders’ equity                        159,890         163,781
Total liabilities and stockholders’ equity        $ 206,266       $ 208,449
                                                                  

Millennial Media,Inc.

Unaudited Consolidated Statements of Operations

(in thousands, except per share data)
                                                 
                  Three Months Ended September       Nine Months Ended
                  30,                                September 30,
                    2013          2012           2013       2012    
                                                                   
Revenue           $  56,061        $  47,366         $ 162,508     $ 119,707
Cost of revenue     33,860         28,005         95,559      71,683  
Gross profit         22,201           19,361           66,949        48,024
Operating
expenses:
Sales and            8,626            5,922            25,119        16,561
marketing
Technology and       3,939            4,667            12,203        10,084
development
General and         14,232         10,491         40,970      28,428  
administrative
Total operating     26,797         21,080         78,292      55,073  
expenses
Loss from            (4,596  )        (1,719  )        (11,343 )     (7,049  )
operations
Other income
(expense)
Interest             (15     )        (14     )        (36     )     (52     )
expense, net
Other expense       -              –              -           (834    )
Total other
income              (15     )       (14     )       (36     )    (886    )
(expense)
Loss before          (4,611  )        (1,733  )        (11,379 )     (7,935  )
income taxes
Income tax
benefit             6              (36     )       (31     )    (46     )
(expense)
Net loss             (4,605  )        (1,769  )        (11,410 )     (7,981  )
Accretion of
dividends on
redeemable          -              -              -           (1,328  )
convertible
preferred stock
Net loss
attributable to   $  (4,605  )     $  (1,769  )      $ (11,410 )   $ (9,309  )
common
stockholders
                                                                   
Net loss per
share:
Basic and         $  (0.06   )     $  (0.02   )      $ (0.14   )   $ (0.17   )
diluted
                                                                   
Weighted
average common
shares
outstanding:
Basic and            81,277           75,499           79,924        55,146
diluted
                                                                   
Stock-based
compensation
expense
included above:
Sales and         $  177           $  286            $ 622         $ 410
marketing
Technology and       176              2,037            1,503         2,889
development
General and          1,284            903              4,674         1,974
administrative


Millennial Media,Inc.



Reconciliation of GAAP net loss to non-GAAP Adjusted EBITDA
                                                 
                            Three Months Ended        Nine Months Ended
                            September 30,             September 30,
                             2013      2012       2013       2012   
                            (in thousands)            (in thousands)
Net loss                    $ (4,605 )   $ (1,769 )   $ (11,410 )   $ (7,981 )
Adjustments:
  Interest expense, net       15           14           36            52
  Income tax (benefit)        (6     )     36           31            46
  expense
  Depreciation and            1,142        631          3,144         1,593
  amortization expense
  Acquisition-related         1,787        -            2,268         -
  costs
  Deferred compensation       250          -            500           -
  Stock-based                1,637      3,226      6,799       5,273  
  compensation expense
  Total net adjustments      4,825      3,907      12,778      6,964  
Adjusted EBITDA             $ 220       $ 2,138     $ 1,368      $ (1,017 )


Reconciliation of GAAP net loss per share to diluted non-GAAP net income
(loss) per share
                                                  
                             Three Months Ended        Nine Months Ended
                             September 30,             September 30,
                              2013      2012       2013      2012   
Net loss per share           $ (0.06  )   $ (0.02  )   $ (0.14  )   $ (0.17  )
Adjustments:
    Accretion of dividends     -            -            -            0.02
    on preferred
    Interest expense, net      0.00         0.00         0.00         0.00
    Income tax benefit         (0.00  )     0.00         0.00         0.00
    (expense)
    Depreciation and           0.02         0.01         0.04         0.03
    amortization expense
    Acquisition-related        0.02         -            0.03         -
    costs
    Deferred compensation      0.00         -            0.01         -
    Stock-based               0.02       0.04       0.08       0.10   
    compensation expense
    Total net adjustments     0.06       0.05       0.16       0.15   
Diluted non-GAAP net         $ 0.00      $ 0.03       0.02      $ (0.02  )
income (loss) per share
Diluted weighted average       83,526       82,173       83,346       55,146
common shares outstanding
                                                                             

                     Preliminary and Unaudited Pro Forma Combined Statement of Operations
                      (in millions)                        (in millions)
                      Three Months Ended September 30,       Three Months Ended September 30,
                      2013                                   2012
                      Millennial  Jumptap    Combined      Millennial  Jumptap    Combined
                      Media                                  Media
                                                                                      
Revenue               $  56.06     $ 30.47     $ 86.53       $  47.37     $ 14.66     $ 62.02
Intercompany            -         -         (0.21 )       -         -         -     
revenue
Net revenue              56.06       30.47       86.32          47.37       14.66       62.02
Cost of revenue          33.86       19.38       53.24          28.01       9.04        37.05
Intercompany cost       -         -         (0.21 )       -         -         -     
of revenue
Net cost of revenue     33.86     19.38     53.03        28.01     9.04      37.05 
Gross profit             22.20       11.09       33.29          19.36       5.62        24.98
                                                                                      
Operating expenses:
Sales and marketing      8.63        5.34        13.97          5.92        3.75        9.67
Technology and           3.94        4.13        8.06           4.67        3.16        7.83
development
General and             14.23     2.87      17.10        10.49     1.64      12.13 
administrative
Total operating         26.80     12.34     39.13        21.08     8.56      29.64 
expenses
Loss from                (4.60 )     (1.25 )     (5.84 )        (1.72 )     (2.94 )     (4.66 )
operations
Interest and other
expense
Interest expense         (0.01 )     (0.22 )     (0.24 )        (0.01 )     (0.21 )     (0.23 )
Other expense           -         (0.14 )    (0.14 )       -         0.03      0.03  
Total interest and       (0.01 )     (0.37 )     (0.38 )        (0.01 )     (0.18 )     (0.19 )
other expense
Loss before income       (4.61 )     (1.61 )     (6.22 )        (1.73 )     (3.12 )     (4.85 )
taxes
Income tax benefit      0.01      -         0.01         (0.04 )    -         (0.04 )
(expense)
Net loss                 (4.60 )     (1.61 )     (6.22 )        (1.77 )     (3.12 )     (4.89 )
Accretion of
dividends on
redeemable              -         -         -            -         -         -     
convertible
preferred stock
Net loss
attributable to       $  (4.60 )   $ (1.61 )   $ (6.22 )     $  (1.77 )   $ (3.12 )   $ (4.89 )
common stockholders
                                                                                      
                                                                                      
AEBITDA
Net Loss              $  (4.60 )   $ (1.61 )   $ (6.22 )     $  (1.77 )   $ (3.12 )   $ (4.89 )
Adjustments:
Interest expense,        0.02        0.22        0.24           0.01        0.21        0.23
net
Income tax               (0.01 )     -           (0.01 )        0.04        -           0.04
(benefit) expense
Depreciation and
amortization             1.14        0.51        1.65           0.63        0.13        0.76
expense
Acquisition-related      1.79        1.11        2.89           -           -           -
costs
Deferred                 0.25        -           0.25           -           -           -
compensation
Stock-based
compensation             1.64        0.22        1.86           3.23        0.12        3.35
expense
Jumptap warrant and
derivative expense      -         0.14      0.14         -         (0.03 )    (0.03 )
(income)
Total net               4.83      2.20      7.03         3.91      0.43      4.34  
adjustments:
Adjusted EBITDA       $  0.22     $ 0.59     $ 0.81       $  2.14     $ (2.69 )   $ (0.55 )

Amounts in the tables above have been rounded and therefore may not sum.

                     
                        Preliminary and Unaudited Pro Forma Combined Statement of Operations
                        (in millions)                         (in millions)
                        Nine Months Ended September 30,         Nine Months Ended September 30,
                        2013                                    2012
                        Millennial  Jumptap    Combined       Millennial  Jumptap    Combined
                        Media                                   Media
                                                                                         
Revenue                 $ 162.51     $ 69.96     $ 232.47       $ 119.71     $ 45.75     $ 165.45
Intercompany             -          -         (0.21  )      -          -         -      
revenue
Net revenue              162.51     69.96     232.26       119.71     45.75     165.45 
Cost of revenue           95.56        43.95       139.51         71.68        28.12       99.80
Intercompany cost        -          -         (0.21  )      -          -         -      
of revenue
Net cost of revenue      95.56      43.95     139.30       71.68      28.12     99.80  
Gross profit              66.95        26.01       92.96          48.02        17.63       65.65
                                                                                         
Operating expenses:
Sales and marketing       25.12        15.82       40.94          16.56        12.31       28.87
Technology and            12.20        12.32       24.52          10.08        9.73        19.81
development
General and              40.97      6.41      47.38        28.43      4.40      32.83  
administrative
Total operating          78.29      34.54     112.84       55.07      26.44     81.52  
expenses
Loss from                 (11.34 )     (8.53 )     (19.87 )       (7.05  )     (8.82 )     (15.87 )
operations
Interest and other
expense
Interest expense          (0.04  )     (0.63 )     (0.66  )       (0.05  )     (0.59 )     (0.64  )
Other expense            -          (0.04 )    (0.04  )      (0.83  )    0.19      (0.65  )
Total interest and        (0.04  )     (0.66 )     (0.70  )       (0.89  )     (0.40 )     (1.29  )
other expense
Loss before income        (11.38 )     (9.19 )     (20.57 )       (7.94  )     (9.22 )     (17.15 )
taxes
Income tax benefit       (0.03  )    -         (0.03  )      (0.05  )    -         (0.05  )
(expense)
Net loss                  (11.41 )     (9.19 )     (20.60 )       (7.98  )     (9.22 )     (17.20 )
Accretion of
dividends on
redeemable               -          -         -            (1.33  )    -         (1.33  )
convertible
preferred stock
Net loss
attributable to         $ (11.41 )   $ (9.19 )   $ (20.60 )     $ (9.31  )   $ (9.22 )   $ (18.53 )
common stockholders
                                                                                         
                                                                                         
AEBITDA
Net Loss                $ (11.41 )   $ (9.19 )   $ (20.60 )     $ (7.98  )   $ (9.22 )   $ (17.20 )
Adjustments:
Interest expense,         0.04         0.63        0.67           0.05         0.59        0.64
net
Income tax                0.03         -           0.03           0.05         -           0.05
(benefit) expense
Depreciation and
amortization              3.14         1.21        4.35           1.59         0.36        1.95
expense
Acquisition-related       2.27         1.11        3.37           -            -           -
costs
Deferred                  0.50         -           0.50           -            -           -
compensation
Stock-based
compensation              6.80         0.45        7.25           5.27         0.40        5.67
expense
Jumptap warrant and
derivative expense       -          0.04      0.04         -          (0.19 )    (0.19  )
(income)
Total net                12.78      3.43      16.21        6.96       1.15      8.12   
adjustments:
Adjusted EBITDA         $ 1.37      $ (5.77 )   $ (4.40  )     $ (1.02  )   $ (8.06 )   $ (9.08  )

Amounts in the tables above have been rounded and therefore may not sum.

                                 
                                    Pro Forma Combined Statement of Operations
                                    (in millions)
                                    Twelve Months Ended December 31, 2012
                                    Millennial Media  Jumptap     Combined
                                                                    
Revenue                             $   177.67         $ 63.63      $ 241.30
Intercompany revenue                   -              -          -      
Net revenue                             177.67           63.63        241.30
Cost of revenue                         105.74           39.11        144.85
Intercompany cost of revenue           -              -          -      
Net cost of revenue                    105.74         39.11      144.85 
Gross profit                            71.93            24.53        96.45
                                                                    
Operating expenses:
Sales and marketing                     23.82            17.21        41.03
Technology and development              13.62            12.95        26.57
General and administrative             38.95          6.91       45.86  
Total operating expenses               76.39          37.07      113.46 
Loss from operations                    (4.46    )       (12.55 )     (17.01 )
Interest and other expense
Interest expense                        (0.06    )       (0.84  )     (0.90  )
Other expense                          (0.83    )      0.34       (0.49  )
Total interest and other                (0.90    )       (0.50  )     (1.40  )
expense
Loss before income taxes                (5.36    )       (13.04 )     (18.41 )
Income tax benefit (expense)           (0.07    )      -          (0.07  )
Net loss                                (5.43    )       (13.04 )     (18.48 )
Accretion of dividends on
redeemable convertible                 (1.33    )      -          (1.33  )
preferred stock
Net loss attributable to common     $   (6.76    )     $ (13.04 )   $ (19.80 )
stockholders
                                                                    
                                                                    
AEBITDA
Net Loss                            $   (5.43    )     $ (13.04 )   $ (18.48 )
Adjustments:
Interest expense, net                   0.06             0.84         0.90
Income tax (benefit) expense            0.07             -            0.07
Depreciation and amortization           2.37             0.60         2.96
expense
Acquisition-related costs               -                -            -
Deferred compensation                   -                -            -
Stock-based compensation                7.47             0.53         8.00
expense
Jumptap warrant and derivative         -              (0.34  )    (0.34  )
expense (income)
Total net adjustments:                 9.97           1.62       11.59  
Adjusted EBITDA                     $   4.54          $ (11.43 )   $ (6.88  )

Amounts in the tables above have been rounded and therefore may not sum.

Contact:

Millennial Media, Inc.
Investor Relations
Joseph Wilkinson, 443-681-6238
IR@millennialmedia.com
or
Matthew Lindberg, 203-682-8214
press@millennialmedia.com