LendingClub Reports Second Quarter and Full Year 2017 Results
LendingClub Reports Second Quarter and Full Year 2017 Results
LendingClub returns to growth; revenue up 35% Year-Over-Year, 12% Quarter-Over-Quarter to $139.6 million
PR Newswire
SAN FRANCISCO, Aug. 7, 2017
SAN FRANCISCO, Aug. 7, 2017 /PRNewswire/ -- LendingClub (NYSE: LC), America's largest online marketplace connecting borrowers and investors, today announced financial results for the second quarter ended June 30, 2017 and provided guidance for the third quarter and full year 2017.
|
Three Months Ended |
Six Months Ended |
|||||||||||||||||||
|
($ in millions) |
June 30, |
March 31, |
June 30, |
2017 |
2016 |
|||||||||||||||
|
Originations |
$ |
2,147.3 |
$ |
1,958.7 |
$ |
1,955.4 |
$ |
4,106.1 |
$ |
4,705.4 |
||||||||||
|
Net Revenue |
$ |
139.6 |
$ |
124.5 |
$ |
103.4 |
$ |
264.1 |
$ |
255.7 |
||||||||||
|
Consolidated Net Income (Loss) |
$ |
(25.4) |
$ |
(29.8) |
$ |
(81.4) |
$ |
(55.3) |
$ |
(77.2) |
||||||||||
|
Adjusted EBITDA (1) (2) |
$ |
4.5 |
$ |
0.2 |
$ |
(29.1) |
$ |
4.7 |
$ |
(2.8) |
||||||||||
|
(1) |
Adjusted EBITDA is a non-GAAP financial measure. Please see the discussion below under the heading "Non-GAAP Measures" and the reconciliation at the end of this release. |
|
(2) |
Amounts for the three and six month periods ended June 30, 2016 have been reclassified to conform to the current period presentation. |
"It's great to be back to growth. Our second quarter results demonstrate the power of the LendingClub platform and the capability of our team to execute," said Scott Sanborn, LendingClub CEO. "We are excited about the momentum building in the business and the massive opportunity that lies ahead."
Key accomplishments and developments in the second quarter across the LendingClub platform include:
Borrowers
- Achieved 10% sequential growth to over $2.1 billion in originations, driven by strong borrower demand
- Successfully launched multiple conversion initiatives, including pricing optimization and a redesigned website
- Improved sales and marketing efficiency by over 7% sequentially
- Credit continues to perform in line with expectations as observed in both vintage and portfolio trends
Investors
- Successfully executed the first self-sponsored securitization thereby opening a new funding source, expanding the investor base with 20 new investors, and generating a new repeatable revenue stream
- Record number of managed accounts and institutional investors participating on the platform in the quarter
- Successfully launched new iOS mobile application for retail investors
Second Quarter 2017 Financial Highlights
"We closed Q2 with the second highest revenue in our company's history and returned to Adjusted EBITDA profitability. Based on the second quarter results and how we are tracking against our initiatives, we are raising our financial outlook for the year," said Tom Casey, LendingClub CFO.
Originations – Loan originations in the second quarter of 2017 were $2.15 billion, up 10% from both the first quarter of 2017 and compared to the same quarter last year.
Net Revenue – Net revenue in the second quarter of 2017 was $139.6 million, up 12% sequentially and up 35% compared to the same quarter last year, driven primarily by higher loan volumes. In addition, net revenue as a percent of originations, or revenue yield, was 6.50% in the second quarter, up 14 basis points sequentially, driven primarily by revenue related to the securitization program that was commenced in the second quarter.
Consolidated Net Income (Loss) – GAAP net loss was $(25.4) million for the second quarter of 2017, improving $4.4 million compared to the first quarter of 2017 and improving $55.9 million compared to the same quarter last year. The decrease in loss from the first quarter to the second quarter of 2017 was primarily due to a $15.1 million increase in revenue, offset by higher general and administrative expenses as a result of a lower insurance reimbursement of $2.4 million in the second quarter compared to a $9.6 million reimbursement in the first quarter.
Adjusted EBITDA (3) – Adjusted EBITDA was $4.5 million in the second quarter of 2017, improving $4.3 million from the first quarter of 2017 and improving $33.6 million from the same quarter last year. The increase in Adjusted EBITDA from the first quarter to the second quarter of 2017 was primarily due to a $15.1 million increase in revenue, offset by higher general and administrative expenses as a result of a lower insurance reimbursement of $2.4 million in the second quarter compared to a $9.6 million reimbursement in the first quarter.
Earnings Per Share (EPS) – Basic and diluted EPS attributable to LendingClub was $(0.06) for the second quarter of 2017, compared to basic and diluted EPS attributable to LendingClub of $(0.07) in the first quarter of 2017 and $(0.21) in the same quarter last year.
Adjusted EPS (3) – Adjusted EPS was $(0.01) for the second quarter of 2017, compared to adjusted EPS of $(0.02) in the first quarter of 2017 and $(0.09) in the same quarter last year.
Cash, Cash Equivalents and Securities Available for Sale – As of June 30, 2017, cash, cash equivalents and securities available for sale totaled $764 million, with no outstanding debt.
Outlook
Based on the information available as of August 7, 2017, LendingClub has increased its guidance for the full year and third quarter 2017:
Full Year 2017
Total Net Revenue in the range of $585 million to $600 million.
Net Income (Loss) in the range of $(69) million to $(61) million.
Adjusted EBITDA(3) in the range of $50 million to $58 million.
Reconciling Items between net loss and non-GAAP adjusted EBITDA consisting of stock-based compensation of approximately $75 million, depreciation and amortization and other net adjustments of approximately $44 million.
Third Quarter 2017
Total Net Revenue in the range of $154 million to $159 million.
Net Income (Loss) in the range of $(12) million to $(8) million.
Adjusted EBITDA(3) in the range of $18 million to $22 million.
Reconciling Items between net loss and non-GAAP adjusted EBITDA consisting of stock-based compensation of approximately $19 million, depreciation and amortization and other net adjustments of approximately $11 million.
|
(3) |
Adjusted EBITDA and Adjusted EPS are non-GAAP financial measures. Adjusted EBITDA for the prior period has been reclassified to conform to the current period presentation. Please see discussion below under the heading "Non-GAAP Measures" and the reconciliations at the end of this release. |
About LendingClub
LendingClub was founded to transform the banking system to make credit more affordable and investing more rewarding. Today, LendingClub's online credit marketplace connects borrowers and investors to deliver more efficient and affordable access to credit. Through its technology platform, LendingClub is able to create cost efficiencies and passes those savings onto borrowers in the form of lower rates and to investors in the form of solid returns. LendingClub is based in San Francisco, California. Currently, residents of the following states may invest in LendingClub notes: AL, AR, AZ, CA, CO, CT, DC, DE, FL, GA, HI, IA, ID, IL, IN, KS, KY, LA, MA, ME, MD, MI, MN, MO, MS, MT, ND, NE, NH, NJ, NV, NY, OK, OR, RI, SC, SD, TN, TX, UT, VA, VT, WA, WI, WV, or WY. All loans are made by federally regulated issuing bank partners. More information is available at https://www.lendingclub.com.
Conference Call and Webcast Information
The LendingClub second quarter 2017 webcast and teleconference is scheduled to begin at 2:00 p.m. Pacific Time on Monday, August 7, 2017. A live webcast of the call will be available at http://ir.lendingclub.com under the Events & Presentations menu. To access the call, please dial +1 (888) 317-6003, or outside the U.S. +1 (412) 317-6061, with conference ID 3610198, ten minutes prior to 2:00 p.m. Pacific Time (or 5:00 p.m. Eastern Time). An audio archive of the call will be available at http://ir.lendingclub.com. An audio replay will also be available on August 7, 2017, until August 14, 2017, by calling +1 (877) 344-7529 or +1 (412) 317-0088, with Conference ID 10110646 LendingClub has used, and intends to use, its investor relations website, Blog (http://blog.lendingclub.com), Twitter handle (@LendingClub) and Facebook page (https://www.facebook.com/LendingClubTeam) as a means of disclosing material non-public information and to comply with its disclosure obligations under Regulation FD.
Non-GAAP Measures
To supplement our consolidated financial statements, which are prepared and presented in accordance with GAAP, we use the following non-GAAP financial measures: contribution, contribution margin, adjusted EBITDA, adjusted EBITDA margin, and adjusted EPS. Our non-GAAP measures do have limitations as analytical tools and you should not consider them in isolation or as a substitute for an analysis of our results under GAAP.
We believe these non-GAAP measures provide management and investors with useful supplemental information about the financial performance of our business, enable comparison of financial results between periods where certain items may vary independent of business performance, and enable comparison of our financial results with other public companies, many of which present similar non-GAAP financial measures.
In particular, we believe contribution and contribution margin are useful measures of direct product profitability because the measures illustrate the relationship between the costs most directly associated with revenue generating activities and the related revenue, and the effectiveness of the direct costs in obtaining revenue. We believe that adjusted EBITDA and adjusted EBITDA margin are important measures of operating performance because it allows for the comparison of our core operating results, including our return on capital and operating efficiencies, from period to period by removing the impact of depreciation and amortization in our asset base, other non-operating, and share-based compensation, tax consequences, and our capital structure (interest expense from any outstanding debt). We believe adjusted EPS is a useful measure used by investors and analysts in our sector because the exclusion of non-cash items like stock-based compensation and amortization of intangibles is a customary adjustment, and such expenses can vary significant due to many factors unrelated to the business. We believe investor fee revenue associated with the servicing portfolio excluding fair market value accounting adjustments is a useful measure because it reflects the amount of fees actually collected and represents the true economic benefit of our servicing arrangements.
There are a number of limitations related to the use of these non-GAAP financial measures versus their most comparable GAAP measure. In particular, many of the adjustments to derive the non-GAAP financial measures reflect the exclusion of items, specifically stock-based compensation expense, amortization of intangible assets, and the related income tax effects of the aforementioned exclusions that are recurring and will be reflected in our financial results for the foreseeable future. Other companies, including companies in our industry, may calculate these measures differently, which may reduce their usefulness as a comparative measure.
For more information on our non-GAAP financial measures and a reconciliation of such measures to the nearest GAAP measure, please see the "Reconciliation of GAAP to Non-GAAP Measures" tables at the end of this release.
Safe Harbor Statement
Some of the statements above, including statements regarding investor demand and anticipated future financial results are "forward-looking statements." The words "anticipate," "believe," "estimate," "expect," "intend," "may," "outlook," "plan," "predict," "project," "will," "would" and similar expressions may identify forward-looking statements, although not all forward-looking statements contain these identifying words. Factors that could cause actual results to differ materially from those contemplated by these forward statements include: the outcomes of pending governmental investigations and pending or threatened litigation, which are inherently uncertain; the impact of management changes and the ability to continue to retain key personnel; ability to achieve cost savings from recent restructurings; the Company's ability to continue to attract and retain new and existing retail and institutional investors; competition; overall economic conditions; demand for the types of loans facilitated by the Company; default rates and those factors set forth in the section titled "Risk Factors" in the Company's most recent Quarterly Report on Form 10-Q and Annual Report on Form 10-K, each filed with the SEC. The Company may not actually achieve the plans, intentions or expectations disclosed in forward-looking statements, and you should not place undue reliance on forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in forward-looking statements. The Company does not assume any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
Information in this press release is not an offer to sell securities or the solicitation of an offer to buy securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction.
Additional information about LendingClub is available in the prospectus for LendingClub's notes, which can be obtained on LendingClub's website at https://www.lendingclub.com/info/prospectus.action.
|
LENDINGCLUB CORPORATION |
||||||||||||||||||||||||||
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
||||||||||||||||||||||||||
|
(In thousands, except share and per share data) |
||||||||||||||||||||||||||
|
(Unaudited) |
||||||||||||||||||||||||||
|
Three Months Ended |
Six Months Ended |
|||||||||||||||||||||||||
|
2017 |
2016 |
2017 |
2016 |
|||||||||||||||||||||||
|
Net revenue: |
||||||||||||||||||||||||||
|
Transaction fees |
$ |
107,314 |
$ |
96,605 |
$ |
206,006 |
$ |
221,113 |
||||||||||||||||||
|
Investor fees (1) |
21,116 |
14,656 |
42,296 |
35,143 |
||||||||||||||||||||||
|
Other revenue (expense) (1) |
4,223 |
(9,910) |
6,444 |
(3,807) |
||||||||||||||||||||||
|
Interest income |
157,260 |
179,685 |
318,256 |
357,564 |
||||||||||||||||||||||
|
Interest expense |
(150,340) |
(177,596) |
(308,947) |
(354,279) |
||||||||||||||||||||||
|
Net interest income |
6,920 |
2,089 |
9,309 |
3,285 |
||||||||||||||||||||||
|
Total net revenue |
139,573 |
103,440 |
264,055 |
255,734 |
||||||||||||||||||||||
|
Operating expenses: (2) |
||||||||||||||||||||||||||
|
Sales and marketing |
55,582 |
49,737 |
110,165 |
116,312 |
||||||||||||||||||||||
|
Origination and servicing |
21,274 |
20,934 |
41,723 |
40,132 |
||||||||||||||||||||||
|
Engineering and product development |
35,718 |
29,209 |
71,478 |
53,407 |
||||||||||||||||||||||
|
Other general and administrative |
52,495 |
53,457 |
96,069 |
91,492 |
||||||||||||||||||||||
|
Goodwill impairment |
— |
35,400 |
— |
35,400 |
||||||||||||||||||||||
|
Total operating expenses |
165,069 |
188,737 |
319,435 |
336,743 |
||||||||||||||||||||||
|
Income (loss) before income tax expense |
(25,496) |
(85,297) |
(55,380) |
(81,009) |
||||||||||||||||||||||
|
Income tax (benefit) expense |
(52) |
(3,946) |
(92) |
(3,795) |
||||||||||||||||||||||
|
Consolidated net loss |
(25,444) |
(81,351) |
(55,288) |
(77,214) |
||||||||||||||||||||||
|
Less: Income attributable to noncontrolling interests |
10 |
— |
10 |
— |
||||||||||||||||||||||
|
LendingClub net loss |
$ |
(25,454) |
$ |
(81,351) |
$ |
(55,298) |
$ |
(77,214) |
||||||||||||||||||
|
Net loss per share attributable to LendingClub: |
||||||||||||||||||||||||||
|
Basic |
$ |
(0.06) |
$ |
(0.21) |
$ |
(0.14) |
$ |
(0.20) |
||||||||||||||||||
|
Diluted |
$ |
(0.06) |
$ |
(0.21) |
$ |
(0.14) |
$ |
(0.20) |
||||||||||||||||||
|
Weighted-average common shares – Basic |
406,676,996 |
382,893,402 |
403,510,351 |
381,794,090 |
||||||||||||||||||||||
|
Weighted-average common shares – Diluted |
406,676,996 |
382,893,402 |
403,510,351 |
381,794,090 |
||||||||||||||||||||||
|
(1) |
In the first quarter of 2017, the Company aggregated the revenue previously reported as "Servicing fees" and "Management fees" into "Investor fees." Additionally, the Company aggregated "Fair value adjustments - loans, loans held for sale, notes and certificates" into "Other revenue (expense)." These changes had no impact to "Total net revenue." Prior period amounts have been reclassified to conform to the current period presentation. |
|||||||||||||||||||||||||
|
(2) |
Includes stock-based compensation expense as follows: |
|||||||||||||||||||||||||
|
Three Months Ended |
Six Months Ended |
|||||||||||||||||||||||||
|
2017 |
2016 |
2017 |
2016 |
|||||||||||||||||||||||
|
Sales and marketing |
$ |
1,967 |
$ |
1,413 |
$ |
4,266 |
$ |
3,317 |
||||||||||||||||||
|
Origination and servicing |
1,354 |
963 |
2,770 |
1,709 |
||||||||||||||||||||||
|
Engineering and product development |
5,773 |
4,480 |
12,361 |
8,203 |
||||||||||||||||||||||
|
Other general and administrative |
9,994 |
6,591 |
19,189 |
15,239 |
||||||||||||||||||||||
|
Total stock-based compensation expense |
$ |
19,088 |
$ |
13,447 |
$ |
38,586 |
$ |
28,468 |
||||||||||||||||||
|
LENDINGCLUB CORPORATION |
|||||||||||||||||||||||||||
|
OPERATING HIGHLIGHTS |
|||||||||||||||||||||||||||
|
(In thousands, except percentages and number of employees, or as noted) |
|||||||||||||||||||||||||||
|
(Unaudited) |
|||||||||||||||||||||||||||
|
June 30, |
|||||||||||||||||||||||||||
|
Three Months Ended |
% Change |
||||||||||||||||||||||||||
|
June 30, |
September 30, |
December 31, |
March 31, |
June 30, |
Q/Q |
Y/Y |
|||||||||||||||||||||
|
Operating Highlights: |
|||||||||||||||||||||||||||
|
Loan originations (in millions) |
$ |
1,955 |
$ |
1,972 |
$ |
1,987 |
$ |
1,959 |
$ |
2,147 |
10 |
% |
10 |
% |
|||||||||||||
|
Net revenue |
$ |
103,440 |
$ |
114,556 |
$ |
130,522 |
$ |
124,482 |
$ |
139,573 |
12 |
% |
35 |
% |
|||||||||||||
|
Consolidated net income (loss) |
$ |
(81,351) |
$ |
(36,486) |
$ |
(32,269) |
$ |
(29,844) |
$ |
(25,444) |
15 |
% |
(69) |
% |
|||||||||||||
|
Contribution (1) (2) |
$ |
35,145 |
$ |
56,035 |
$ |
60,736 |
$ |
53,165 |
$ |
66,038 |
24 |
% |
88 |
% |
|||||||||||||
|
Contribution margin (1) (2) |
34.0 |
% |
48.9 |
% |
46.5 |
% |
42.7 |
% |
47.3 |
% |
N/M |
N/M |
|||||||||||||||
|
Adjusted EBITDA (1) (2) |
$ |
(29,067) |
$ |
(9,200) |
$ |
(880) |
$ |
161 |
$ |
4,493 |
N/M |
(115) |
% |
||||||||||||||
|
Adjusted EBITDA margin (1) (2) |
(28.1) |
% |
(8.0) |
% |
(0.7) |
% |
0.1 |
% |
3.2 |
% |
N/M |
N/M |
|||||||||||||||
|
EPS - diluted |
$ |
(0.21) |
$ |
(0.09) |
$ |
(0.08) |
$ |
(0.07) |
$ |
(0.06) |
14 |
% |
N/M |
||||||||||||||
|
Adjusted EPS - diluted (1) |
$ |
(0.09) |
$ |
(0.04) |
$ |
(0.02) |
$ |
(0.02) |
$ |
(0.01) |
50 |
% |
N/M |
||||||||||||||
|
Originations by Investor Type: |
|||||||||||||||||||||||||||
|
Managed accounts |
35 |
% |
55 |
% |
43 |
% |
33 |
% |
31 |
% |
|||||||||||||||||
|
Self-directed |
17 |
% |
14 |
% |
13 |
% |
15 |
% |
13 |
% |
|||||||||||||||||
|
Banks |
28 |
% |
13 |
% |
31 |
% |
40 |
% |
44 |
% |
|||||||||||||||||
|
Other institutional investors |
20 |
% |
18 |
% |
13 |
% |
12 |
% |
12 |
% |
|||||||||||||||||
|
Total |
100 |
% |
100 |
% |
100 |
% |
100 |
% |
100 |
% |
|||||||||||||||||
|
Originations by Program: |
|||||||||||||||||||||||||||
|
Personal loans - standard program |
74 |
% |
71 |
% |
74 |
% |
74 |
% |
72 |
% |
|||||||||||||||||
|
Personal loans - custom program |
15 |
% |
18 |
% |
16 |
% |
15 |
% |
18 |
% |
|||||||||||||||||
|
Other - custom program (3) |
11 |
% |
11 |
% |
10 |
% |
11 |
% |
10 |
% |
|||||||||||||||||
|
Total |
100 |
% |
100 |
% |
100 |
% |
100 |
% |
100 |
% |
|||||||||||||||||
|
Servicing Portfolio by Method Financed (in millions, at end of period): |
|||||||||||||||||||||||||||
|
Notes |
$ |
1,816 |
$ |
1,818 |
$ |
1,795 |
$ |
1,779 |
$ |
1,740 |
(2) |
% |
(4) |
% |
|||||||||||||
|
Certificates |
2,914 |
2,840 |
2,752 |
2,516 |
2,281 |
(9) |
% |
(22) |
% |
||||||||||||||||||
|
Whole loans sold |
5,981 |
6,242 |
6,542 |
6,731 |
7,081 |
5 |
% |
18 |
% |
||||||||||||||||||
|
Other (4) |
36 |
34 |
28 |
27 |
49 |
81 |
% |
36 |
% |
||||||||||||||||||
|
Total |
$ |
10,747 |
$ |
10,934 |
$ |
11,117 |
$ |
11,053 |
$ |
11,151 |
1 |
% |
4 |
% |
|||||||||||||
|
Employees and contractors (5) |
1,499 |
1,464 |
1,530 |
1,599 |
1,627 |
2 |
% |
9 |
% |
||||||||||||||||||
|
Notes: | |
|
N/M Not meaningful. | |
|
(1) |
Represents a non-GAAP measure. See "Reconciliation of GAAP to Non-GAAP Measures." |
|
(2) |
Prior to the three months ended March 30, 2017 amounts have been adjusted to conform to the current period presentation. See "Condensed Consolidated Statements of Operations" for further details. |
|
(3) |
Comprised of education and patient finance loans, small business loans, and small business lines of credit which are less than 10% of the volumes presented individually. |
|
(4) |
Includes loans invested in by the Company for which there are no associated notes or certificates. |
|
(5) |
As of the end of each respective period. |
|
LENDINGCLUB CORPORATION |
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|
SELECT FINANCIAL HIGHLIGHTS |
||||||||||||||||||||||||||
|
(In thousands, except percentages or as noted) |
||||||||||||||||||||||||||
|
(Unaudited) |
||||||||||||||||||||||||||
|
June 30, |
||||||||||||||||||||||||||
|
Three Months Ended |
% Change |
|||||||||||||||||||||||||
|
June 30, |
September 30, |
December 31, |
March 31, |
June 30, |
Q/Q |
Y/Y |
||||||||||||||||||||
|
Select Balance Sheet Information (in millions, at end of period): |
||||||||||||||||||||||||||
|
Cash and cash equivalents |
$ |
573 |
$ |
521 |
$ |
516 |
$ |
534 |
$ |
539 |
1 |
% |
(6) |
% |
||||||||||||
|
Securities available for sale |
$ |
259 |
$ |
279 |
$ |
287 |
$ |
247 |
$ |
225 |
(9) |
% |
(13) |
% |
||||||||||||
|
Total |
$ |
832 |
$ |
800 |
$ |
803 |
$ |
781 |
$ |
764 |
(2) |
% |
(8) |
% |
||||||||||||
|
Loans |
$ |
4,408 |
$ |
4,412 |
$ |
4,312 |
$ |
4,027 |
$ |
3,797 |
(6) |
% |
(14) |
% |
||||||||||||
|
Notes and certificates |
$ |
4,416 |
$ |
4,420 |
$ |
4,321 |
$ |
4,034 |
$ |
3,806 |
(6) |
% |
(14) |
% |
||||||||||||
|
Total assets |
$ |
5,622 |
$ |
5,608 |
$ |
5,563 |
$ |
5,232 |
$ |
5,029 |
(4) |
% |
(11) |
% |
||||||||||||
|
Total equity |
$ |
988 |
$ |
977 |
$ |
976 |
$ |
972 |
$ |
984 |
1 |
% |
— |
% |
||||||||||||
|
LENDINGCLUB CORPORATION |
||||||||||||||||||||||||||||||||||||||
|
RECONCILIATION OF GAAP TO NON-GAAP MEASURES |
||||||||||||||||||||||||||||||||||||||
|
(In thousands, except percentages and per share data) |
||||||||||||||||||||||||||||||||||||||
|
(Unaudited) |
||||||||||||||||||||||||||||||||||||||
|
Three Months Ended |
Six Months Ended |
|||||||||||||||||||||||||||||||||||||
|
June 30, |
September 30, |
December 31, |
March 31, |
June 30, |
June 30, |
June 30, |
||||||||||||||||||||||||||||||||
|
Contribution reconciliation: |
||||||||||||||||||||||||||||||||||||||
|
Consolidated net loss |
$ |
(81,351) |
$ |
(36,486) |
$ |
(32,269) |
$ |
(29,844) |
$ |
(25,444) |
$ |
(77,214) |
$ |
(55,288) |
||||||||||||||||||||||||
|
Engineering and product development expense |
29,209 |
29,428 |
32,522 |
35,760 |
35,718 |
53,407 |
71,478 |
|||||||||||||||||||||||||||||||
|
Other general and administrative expense |
53,457 |
58,940 |
56,740 |
43,574 |
52,495 |
91,492 |
96,069 |
|||||||||||||||||||||||||||||||
|
Goodwill impairment |
35,400 |
1,650 |
— |
— |
— |
35,400 |
— |
|||||||||||||||||||||||||||||||
|
Stock-based compensation expense |
2,376 |
2,712 |
3,967 |
3,715 |
3,321 |
5,026 |
7,036 |
|||||||||||||||||||||||||||||||
|
Income tax (benefit) expense |
(3,946) |
(209) |
(224) |
(40) |
(52) |
(3,795) |
(92) |
|||||||||||||||||||||||||||||||
|
Contribution (1) |
$ |
35,145 |
$ |
56,035 |
$ |
60,736 |
$ |
53,165 |
$ |
66,038 |
$ |
104,316 |
$ |
119,203 |
||||||||||||||||||||||||
|
Total net revenue |
$ |
103,440 |
$ |
114,556 |
$ |
130,522 |
$ |
124,482 |
$ |
139,573 |
$ |
255,734 |
$ |
264,055 |
||||||||||||||||||||||||
|
Contribution margin (1) |
34.0 |
% |
48.9 |
% |
46.5 |
% |
42.7 |
% |
47.3 |
% |
40.8 |
% |
45.1 |
% |
||||||||||||||||||||||||
|
Adjusted EBITDA reconciliation: |
||||||||||||||||||||||||||||||||||||||
|
Consolidated net loss |
$ |
(81,351) |
$ |
(36,486) |
$ |
(32,269) |
$ |
(29,844) |
$ |
(25,444) |
$ |
(77,214) |
$ |
(55,288) |
||||||||||||||||||||||||
|
Acquisition and related expense (2) |
293 |
294 |
294 |
293 |
56 |
586 |
349 |
|||||||||||||||||||||||||||||||
|
Depreciation expense: |
||||||||||||||||||||||||||||||||||||||
|
Engineering and product development |
4,917 |
5,362 |
6,134 |
7,794 |
8,483 |
9,410 |
16,277 |
|||||||||||||||||||||||||||||||
|
Other general and administrative |
993 |
1,104 |
1,213 |
1,298 |
1,305 |
1,899 |
2,603 |
|||||||||||||||||||||||||||||||
|
Amortization of intangible assets |
1,180 |
1,163 |
1,161 |
1,162 |
1,057 |
2,436 |
2,219 |
|||||||||||||||||||||||||||||||
|
Goodwill impairment |
35,400 |
1,650 |
— |
— |
— |
35,400 |
— |
|||||||||||||||||||||||||||||||
|
Stock-based compensation expense |
13,447 |
17,922 |
22,811 |
19,498 |
19,088 |
28,468 |
38,586 |
|||||||||||||||||||||||||||||||
|
Income tax (benefit) expense |
(3,946) |
(209) |
(224) |
(40) |
(52) |
(3,795) |
(92) |
|||||||||||||||||||||||||||||||
|
Adjusted EBITDA (1) |
$ |
(29,067) |
$ |
(9,200) |
$ |
(880) |
$ |
161 |
$ |
4,493 |
$ |
(2,810) |
$ |
4,654 |
||||||||||||||||||||||||
|
Total net revenue |
$ |
103,440 |
$ |
114,556 |
$ |
130,522 |
$ |
124,482 |
$ |
139,573 |
$ |
255,734 |
$ |
264,055 |
||||||||||||||||||||||||
|
Adjusted EBITDA margin (1) |
(28.1) |
% |
(8.0) |
% |
(0.7) |
% |
0.1 |
% |
3.2 |
% |
(1.1)% |
1.8 |
% |
|||||||||||||||||||||||||
|
Notes: | |
|
(1) |
Beginning in the first quarter of 2017, contribution and adjusted EBITDA include interest revenue to capture the full spectrum of revenue the Company expects to generate. Prior period amounts have been reclassified to conform to the current period presentation. |
|
(2) |
Represents amounts related to costs for due diligence related to past business acquisitions including those the Company reviewed and determined not to pursue a transaction, as well as incremental compensation expense required to be paid under the purchase agreement to retain key former shareholder employees of an acquired business. |
|
LENDINGCLUB CORPORATION |
||||||||||||||||||||||||||||
|
RECONCILIATION OF GAAP TO NON-GAAP MEASURES (Continued) |
||||||||||||||||||||||||||||
|
(In thousands, except percentages and per share data) |
||||||||||||||||||||||||||||
|
(Unaudited) |
||||||||||||||||||||||||||||
|
Three Months Ended |
Six Months Ended |
|||||||||||||||||||||||||||
|
June 30, |
September 30, |
December 31, |
March 31, |
June 30, |
June 30, |
June 30, |
||||||||||||||||||||||
|
Adjusted net loss reconciliation: |
||||||||||||||||||||||||||||
|
LendingClub net loss |
$ |
(81,351) |
$ |
(36,486) |
$ |
(32,269) |
$ |
(29,844) |
$ |
(25,454) |
$ |
(77,214) |
$ |
(55,298) |
||||||||||||||
|
Acquisition and related expense (1) |
293 |
294 |
294 |
293 |
56 |
586 |
349 |
|||||||||||||||||||||
|
Stock-based compensation expense |
13,447 |
17,922 |
22,811 |
19,498 |
19,088 |
28,468 |
38,586 |
|||||||||||||||||||||
|
Amortization of acquired intangible assets |
1,180 |
1,163 |
1,161 |
1,162 |
1,057 |
2,436 |
2,219 |
|||||||||||||||||||||
|
Goodwill impairment |
35,400 |
1,650 |
— |
— |
— |
35,400 |
— |
|||||||||||||||||||||
|
Income tax (benefit) expense |
(3,946) |
(209) |
(114) |
— |
— |
(3,795) |
— |
|||||||||||||||||||||
|
Adjusted LendingClub net loss |
$ |
(34,977) |
$ |
(15,666) |
$ |
(8,117) |
$ |
(8,891) |
$ |
(5,253) |
$ |
(14,119) |
$ |
(14,144) |
||||||||||||||
|
Adjusted EPS - diluted |
$ |
(0.09) |
$ |
(0.04) |
$ |
(0.02) |
$ |
(0.02) |
$ |
(0.01) |
$ |
(0.04) |
$ |
(0.04) |
||||||||||||||
|
Non-GAAP diluted shares reconciliation: |
||||||||||||||||||||||||||||
|
GAAP diluted shares (2) |
382,893 |
391,453 |
395,877 |
400,309 |
406,677 |
381,794 |
403,510 |
|||||||||||||||||||||
|
Other dilutive equity awards (3) |
— |
— |
— |
— |
— |
— |
— |
|||||||||||||||||||||
|
Non-GAAP diluted shares |
382,893 |
391,453 |
395,877 |
400,309 |
406,677 |
381,794 |
403,510 |
|||||||||||||||||||||
|
Notes: | |
|
(1) |
Represents amounts related to costs for due diligence related to past business acquisitions including those the Company reviewed and determined not to pursue a transaction, as well as incremental compensation expense required to be paid under the purchase agreement to retain key former shareholder employees of an acquired business. |
|
(2) |
Equivalent to the basic and diluted shares reflected in the quarterly EPS calculations. |
|
(3) |
Other dilutive equity awards include assumed exercises of unvested stock options, net of assumed repurchases computed under the treasury method, which were excluded from GAAP net loss per share as their impact would have been anti-dilutive, but are included in adjusted net loss per share as the impact was dilutive. |
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SOURCE LendingClub
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