GlobeNewswire Inc | Aug 4, 2021 06:30AM EDT

August 04, 2021

DALLAS, Aug. 04, 2021 (GLOBE NEWSWIRE) -- Blucora, Inc. (NASDAQ: BCOR), a leading provider of technology-enabled, tax focused financial solutions, today announced financial results for the second quarter ended June30, 2021.

Second Quarter Highlights and Recent Developments

-- Total revenue increased to $254.3 million, or a 58% increase versus Q2 2020 -- GAAP Net Income of $31.6 million, or $0.64 per diluted share -- Non-GAAP Net Income of $63.1 million, or $1.28 per diluted share -- Total client assets ended the quarter up 28% year-over-year to $87.8 billion, with $39.4 billion, or 44.9% in advisory assets -- Advisory assets increased 49% year-over-year, including approximately $5.3 billion in Avantax Planning Partners (APP) assets -- Agreed to acquire Headquarters Advisory Group, LLC, an existing FP with approximately $1.1 billion in assets; once closed, the assets would expand the nationwide footprint of Avantaxs in-house RIA

Our wealth management and tax software businesses continue to exceed expectations during the year, both completing a strong second quarter, commented Chris Walters, Blucoras President and Chief Executive Officer. Mr. Walters continued, We continue to operate effectively in executing our strategic priorities, which were designed to drive long-term sustainable growth for both businesses.

Summary Financial Performance: Q2 2021 ($ in millions except per share amounts)

Q2 2021 Q2 2020 ChangeRevenue: Wealth Management $ 162.4 $ 115.9 40% Tax Software $ 91.9 $ 45.2 103% Total Revenue $ 254.3 $ 161.1 58% Segment Operating Income Wealth Management $ 21.4 $ 11.7 83% Tax Software $ 63.4 $ 6.7 846% Total Segment Operating Income $ 84.8 $ 18.4 361% Unallocated Corporate-LevelGeneral and Administrative $ (6.3 ) $ (5.8 ) (9)% ExpensesGAAP: Operating Income (Loss) $ 41.6 $ (4.6 ) 1004% Net Income $ 31.6 $ 49.6 (36)% Diluted Net Income Per Share $ 0.64 $ 1.03 (38)% Non-GAAP: ^(1) Adjusted EBITDA $ 78.6 $ 12.6 524% Net Income $ 63.1 $ 4.5 1302% Diluted Net Income per Share $ 1.28 $ 0.09 1322%

_________________________ (1)See reconciliations of all non-GAAP to GAAP measures presented in this release in the tables below.

Third Quarter and Full Year 2021 Outlook

($ in millions except per share amounts) 3Q 2021 Full Year 2021Wealth Management Revenue $158.5 - $631.5 - $162.5 $649.5Tax Software Revenue $5.0 - $5.5 $223.5 - $226.5Total Revenue $163.5 - $855.0 - $168.0 $876.0Wealth Management Segment Operating Income $16.5 - $18.0 $79.0 - $83.5Tax Software Segment Operating Income ($15.5) - $80.0 - ($15.0) $82.0Unallocated Corporate-Level General and $7.5 - $7.0 $27.5 -Administrative Expenses $26.5GAAP: Net Income (loss) ($34.0) - $ ($8.5) - (30.5) $1.0Net Income (loss) per diluted share ($0.69) - ($0.17) - ($0.62) $0.02Non-GAAP: Adjusted EBITDA (1) ($6.5) - $131.5 - ($4.0) $139.0Non-GAAP Net Income (loss) (1) ($19.0) - $76.0 - ($16.0) $84.5Non-GAAP Net Income (loss) per diluted share (1) ($0.39) - $1.52 - ($0.33) $1.70

____________________________

(1)See reconciliations of all non-GAAP to GAAP measures presented in this release in the tables below.

Conference Call and Webcast

A conference call and live webcast will be held today at 8:30 a.m. Eastern Time during which the Company will further discuss second quarter results, its outlook for full year 2021, its tax season update, and other business matters. We will also provide supplemental financial information to our results on the Investor Relations section of the Blucora corporate website at www.blucora.com prior to the call. The supplemental financial information has also been furnished with the SEC on Form 8-K. A replay of the call will be available on our website.

About Blucora

Blucora, Inc. (NASDAQ: BCOR) is a provider of data and technology-driven solutions that empowers people to improve their financial wellness. Blucora operates in two segments including (i) wealth management, through its Avantax Wealth Management and Avantax Planning Partners brands, with a collective $88 billion in total client assets as of June30, 2021 and (ii) tax software, through its TaxAct business, a market leader in tax software with approximately 3 million consumer and approximately 24,500 professional users in 2021. With integrated tax-focused software and wealth management, Blucora is uniquely positioned to assist our customers in achieving better long-term outcomes via holistic, tax-advantaged solutions. For more information on Blucora, visit www.blucora.com.

Source: Blucora

Blucora Investor RelationsDee Littrell (972) 870-6463IR@Blucora.com

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact. Forward-looking statements can also be identified by words such as believes, estimates, should, could, would, plans, expects, intends, anticipates, may, forecasts, future, will, projects, predicts, potential, continues, target, outlook and similar expressions and variations. Actual results may differ significantly from managements expectations due to various risks and uncertainties including, but not limited to: the impact of the coronavirus pandemic on our results of operations and our business, including the impact of the resulting economic and market disruption, the extension of tax filing deadlines and other related relief; our ability to effectively implement our future business plans and growth strategy; our ability to effectively compete within our industry; our ability to attract and retain financial professionals, qualified employees, clients, and customers, as well as our ability to provide strong customer/client service; our ability to close, finance, and realize all of the anticipated benefits of acquisitions, as well as our ability to integrate the operations of recently acquired businesses, and the potential impact of such acquisitions on our existing indebtedness and leverage; our ability to fulfill the closing conditions to, and consummate, the acquisition of Headquarters Advisory Group; our ability to retain employees and acquired client assets following such acquisition; our future capital requirements and the availability of financing, if necessary; our ability to meet our current and future debt service obligations, including our ability to maintain compliance with our debt covenants; downgrade of the Companys credit ratings; our ability to generate strong performance for our clients and the impact of the financial markets on our clients portfolios; the impact of new or changing legislation and regulations (or interpretations thereof) on our business, including our ability to successfully address and comply with such legislation and regulations (or interpretations thereof) and increased costs, reductions of revenue, and potential fines, penalties or disgorgement to which we may be subject as a result thereof; risks, burdens, and costs, including fines, penalties or disgorgement, associated with our business being subjected to regulatory inquiries, investigations or initiatives; risks associated with legal proceedings, including litigation and regulatory proceedings; our ability to manage leadership and employee transitions, including costs and time burdens on management and our board of directors related thereto; political and economic conditions and events that directly or indirectly impact the wealth management and tax software industries; our ability to respond to rapid technological changes, including our ability to successfully release new products and services or improve upon existing products and services; the compromising of confidentiality, availability or integrity of information, including cyberattacks; our expectations concerning the revenues we generate from fees associated with the financial products that we distribute; risks related to goodwill and other intangible asset impairment; our ability to develop, establish, and maintain strong brands; risks associated with the use and implementation of information technology and the effect of security breaches, computer viruses, and computer hacking attacks; our ability to comply with laws and regulations regarding privacy and protection of user data; our ability to maintain our relationships with third-party partners, providers, suppliers, vendors, distributors, contractors, financial institutions, industry associations, and licensing partners, and our expectations regarding and reliance on the products, tools, platforms, systems, and services provided by these third parties; our beliefs and expectations regarding the seasonality of our business; our assessments and estimates that determine our effective tax rate; and our ability to protect our intellectual property and the impact of any claim that we have infringed on the intellectual property rights of others. A more detailed description of these and certain other factors that could affect actual results is included in the Companys filings with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Company undertakes no obligation to update any forward-looking statements to reflect events or circumstances after the date hereof, except as may be required by law.

Blucora, Inc.Condensed Consolidated Statements of Operations(Unaudited) (Amounts in thousands, except per share data)

Three months ended Six months ended June 30, June 30, 2021 2020 2021 2020Revenues: Wealthmanagement $ 162,395 $ 115,884 $ 316,886 $ 260,873 services revenueTax software 91,917 45,238 215,809 163,569 services revenueTotal revenue 254,312 161,122 532,695 424,442 Operating expenses:Cost of revenue: Wealthmanagement 113,910 83,868 222,533 186,210 services cost ofrevenueTax softwareservices cost of 4,429 3,054 10,007 7,067 revenueTotal cost of 118,339 86,922 232,540 193,277 revenueEngineering and 7,231 7,377 14,359 15,892 technologySales and 34,848 40,057 112,410 119,767 marketingGeneral and 23,832 20,200 48,517 44,928 administrativeAcquisition and 18,169 2,824 26,272 8,506 integrationDepreciation 3,204 1,675 5,504 3,471 Amortization ofother acquired 7,063 6,673 14,238 14,421 intangibleassetsImpairment of ? ? ? 270,625 goodwillTotal operating 212,686 165,728 453,840 670,887 expensesOperating income 41,626 (4,606 ) 78,855 (246,445 ) (loss)Other loss, net (8,024 ) (5,288 ) (15,907 ) (11,423 ) ^(1)Income (loss)before income 33,602 (9,894 ) 62,948 (257,868 ) taxesIncome taxbenefit (1,994 ) 59,539 (3,694 ) (7,981 ) (expense)Net income $ 31,608 $ 49,645 $ 59,254 $ (265,849 ) (loss)Net income(loss) per share:Basic $ 0.65 $ 1.04 $ 1.22 $ (5.55 ) Diluted $ 0.64 $ 1.03 $ 1.20 $ (5.55 ) Weighted averageshares outstanding:Basic 48,508 47,941 48,384 47,884 Diluted 49,385 48,092 49,241 47,884

_________________________ (1)Other loss, net consisted of the following (in thousands):

Three months ended Six months ended June 30, June 30, 2021 2020 2021 2020Interest expense $ 7,302 $ 4,840 $ 14,485 $ 10,156 Amortization of debt issuance 377 331 740 644 costsAccretion of debt discounts 284 70 561 138 Total interest expense 7,963 5,241 15,786 10,938 Interest income ? (11 ) (2 ) (25 ) Other 61 58 123 510 Other loss, net $ 8,024 $ 5,288 $ 15,907 $ 11,423

Blucora, Inc.Condensed Consolidated Balance Sheets(Unaudited) (Amounts in thousands)

June 30, December 31, 2021 2020ASSETS Current assets: Cash and cash equivalents $ 232,409 $ 150,125 Cash segregated under federal or other 591 637 regulationsAccounts receivable, net of allowance 18,784 12,736 Commissions and advisory fees receivable 26,662 26,132 Other receivables 1,045 717 Prepaid expenses and other current assets, 13,972 10,321 netTotal current assets 293,463 200,668 Long-term assets: Property and equipment, net 65,004 58,500 Right-of-use assets, net 21,245 23,455 Goodwill, net 454,821 454,821 Other intangible assets, net 308,743 322,179 Other long-term assets 13,613 4,569 Total long-term assets 863,426 863,524 Total assets $ 1,156,889 $ 1,064,192 LIABILITIES AND STOCKHOLDERS? EQUITY Current liabilities: Accounts payable $ 10,164 $ 9,290 Commissions and advisory fees payable 19,170 19,021 Accrued expenses and other current 80,359 56,419 liabilitiesDeferred revenue?current 5,084 12,298 Lease liabilities?current 3,768 2,304 Current portion of long-term debt, net 1,788 1,784 Total current liabilities 120,333 101,116 Long-term liabilities: Long-term debt, net 552,828 552,553 Deferred tax liability, net 29,700 30,663 Deferred revenue?long-term 5,784 6,247 Lease liabilities?long-term 34,765 36,404 Other long-term liabilities 30,972 24,919 Total long-term liabilities 654,049 650,786 Total liabilities 774,382 751,902 Stockholders? equity: Common stock, par $0.0001?900,000 authorizedshares; 49,962 shares issued and 48,656shares outstanding at June30, 2021; 49,483 5 5 shares issued and 48,177 shares outstandingat December31, 2020Additional paid-in capital 1,609,193 1,598,230 Accumulated deficit (1,198,292 ) (1,257,546 ) Treasury stock, at cost?1,306 shares at (28,399 ) (28,399 ) June30, 2021 and December31, 2020Total stockholders? equity 382,507 312,290 Total liabilities and stockholders? equity $ 1,156,889 $ 1,064,192

Blucora, Inc.Condensed Consolidated Statements of Cash Flows(Unaudited) (Amounts in thousands)

Six months ended June 30, 2021 2020Operating activities: Net income (loss) $ 59,254 $ (265,849 ) Adjustments to reconcile net income (loss) to net cash from operating activities:Stock-based compensation 10,770 2,703 Depreciation and amortization of acquired 21,583 19,253 intangible assetsImpairment of goodwill ? 270,625 Reduction of right-of-use lease assets 1,420 3,196 Deferred income taxes (963 ) 8,784 Amortization of debt issuance costs 740 644 Accretion of debt discounts 561 138 Change in fair value of acquisition-related 17,800 ? contingent considerationAccretion of lease liability 1,046 901 Other 481 670 Cash provided (used) by changes in operating assets and liabilities:Accounts receivable (5,948 ) 184 Commissions and advisory fees receivable (530 ) 5,586 Other receivables (406 ) (2,809 ) Prepaid expenses and other current assets (3,651 ) 1,435 Other long-term assets (9,239 ) 3,162 Accounts payable 874 2,942 Commissions and advisory fees payable 149 (5,210 ) Lease liabilities (431 ) (2,572 ) Deferred revenue (7,677 ) (8,299 ) Accrued expenses and other current and long-term 11,438 (1,110 ) liabilitiesNet cash provided by operating activities 97,271 34,374 Investing activities: Purchases of property and equipment (13,544 ) (19,072 ) Asset acquisitions (881 ) ? Net cash used by investing activities (14,425 ) (19,072 ) Financing activities: Proceeds from credit facilities, net of debt (502 ) 55,000 issuance costs and debt discountsPayments on credit facilities (906 ) (65,625 ) Proceeds from stock option exercises 284 25 Proceeds from issuance of stock through employee 1,845 1,201 stock purchase planTax payments from shares withheld for equity (1,329 ) (1,006 ) awardsNet cash used by financing activities (608 ) (10,405 ) Net increase in cash, cash equivalents, and 82,238 4,897 restricted cashCash, cash equivalents, and restricted cash, 150,762 86,450 beginning of periodCash, cash equivalents, and restricted cash, end $ 233,000 $ 91,347 of period

Blucora, Inc.Segment Information(Unaudited) (Amounts in thousands)

Three months ended Six months ended June 30, June 30, 2021 2020 2021 2020Revenue: Wealth $ 162,395 $ 115,884 $ 316,886 $ 260,873 Management ^(1)Tax Software^ 91,917 45,238 215,809 163,569 (1)Total revenue 254,312 161,122 532,695 424,442 Operating income (loss):Wealth 21,396 11,731 40,792 34,329 ManagementTax Software 63,448 6,659 114,336 44,412 Corporate-level (43,218 ) (22,996 ) (76,273 ) (325,186 ) activity ^(2)Total operating 41,626 (4,606 ) 78,855 (246,445 ) income (loss)Other loss, net (8,024 ) (5,288 ) (15,907 ) (11,423 ) Income (loss)before income 33,602 (9,894 ) 62,948 (257,868 ) taxesIncome taxbenefit (1,994 ) 59,539 (3,694 ) (7,981 ) (expense)Net income $ 31,608 $ 49,645 $ 59,254 $ (265,849 ) (loss)

_________________________ (1)Revenues by major category within each segment are presented below (in thousands):

Three months ended Six months ended June 30, June 30, 2021 2020 2021 2020Wealth Management:Advisory $ 96,508 $ 66,303 $ 187,627 $ 145,060 Commission 51,702 39,836 104,236 90,416 Asset-based 5,526 3,981 10,855 14,560 Transaction 8,659 5,764 14,168 10,837 and feeTotal WealthManagement $ 162,395 $ 115,884 $ 316,886 $ 260,873 revenueTax Software:Consumer $ 88,846 $ 44,421 $ 199,413 $ 148,242 Professional 3,071 817 16,396 15,327 Total TaxSoftware $ 91,917 $ 45,238 $ 215,809 $ 163,569 revenue

(2) Corporate-level activity included the following (in thousands):

Three months ended Six months ended June 30, June 30, 2021 2020 2021 2020Unallocated corporate-levelgeneral and administrative $ 6,259 $ 5,810 $ 11,953 $ 12,826 expensesStock-based compensation 5,160 3,904 10,770 2,703 Acquisition and integration 18,169 2,824 26,272 8,506 costsDepreciation 4,102 2,412 7,345 4,832 Amortization of acquired 7,063 6,673 14,238 14,421 intangible assetsImpairment of goodwill ? ? ? 270,625 Executive transition costs ? 636 ? 9,820 Headquarters relocation ? 737 ? 1,453 costsContested proxy and other 2,465 ? 5,695 ? legal and consulting costsTotal corporate-level $ 43,218 $ 22,996 $ 76,273 $ 325,186 activity

Blucora, Inc.Reconciliations of Non-GAAP Financial Measures to the Nearest Comparable GAAP Measures (1)

Adjusted EBITDA Reconciliation (1)(Unaudited) (Amounts in thousands)

Three months ended Six months ended June 30, June 30, 2021 2020 2021 2020Net income (loss) ^(2) $ 31,608 $ 49,645 $ 59,254 $ (265,849 ) Stock-based 5,160 3,904 10,770 2,703 compensationDepreciation andamortization of 11,165 9,085 21,583 19,253 acquired intangibleassetsOther loss, net 8,024 5,288 15,907 11,423 Acquisition andintegration?Excl.Change in fair value 6,669 2,824 8,472 8,506 of acquisition-relatedcontingentconsiderationAcquisition andintegration?Change infair value of 11,500 ? 17,800 ? acquisition-relatedcontingentconsiderationImpairment of goodwill ? ? ? 270,625 Executive transition ? 636 ? 9,820 costsHeadquarter relocation ? 737 ? 1,453 costsContested proxy andother legal and 2,465 ? 5,695 ? consulting costsIncome tax (benefit) 1,994 (59,539 ) 3,694 7,981 expenseAdjusted EBITDA ^(1) $ 78,585 $ 12,580 $ 143,175 $ 65,915

Non-GAAP Net Income and Non-GAAP Net Income Per Share Reconciliation (1)(Unaudited) (Amounts in thousands, except per share amounts)

Three months ended Six months ended June 30, June 30, 2021 2020 2021 2020Net income (loss) ^ $ 31,608 $ 49,645 $ 59,254 $ (265,849 ) (2)Stock-based 5,160 3,904 10,770 2,703 compensationAmortization ofacquired intangible 7,063 6,673 14,238 14,421 assetsAcquisition andintegration?Excludingchange in fair value 6,669 2,824 8,472 8,506 of HKFS ContingentConsiderationAcquisition andintegration?Change infair value of HKFS 11,500 ? 17,800 ? ContingentConsiderationImpairment of ? ? ? 270,625 goodwillExecutive transition ? 636 ? 9,820 costsHeadquarters ? 737 ? 1,453 relocation costsContested proxy andother legal and 2,465 ? 5,695 ? consulting costsCash tax impact ofadjustments to GAAP (649 ) (259 ) (1,192 ) (995 ) net incomeNon-cash income tax (694 ) (59,697 ) (963 ) 7,340 (benefit) expenseNon-GAAP net income $ 63,122 $ 4,463 $ 114,074 $ 48,024 Per diluted share: Net income (loss) ^ $ 0.64 $ 1.03 $ 1.20 $ (5.52 ) (2) (3)Stock-based 0.10 0.08 0.22 0.06 compensationAmortization ofacquired intangible 0.14 0.14 0.29 0.30 assetsAcquisition andintegration?Excludingchange in fair value 0.14 0.06 0.17 0.18 of HKFS ContingentConsiderationAcquisition andintegration?Change infair value of HKFS 0.23 ? 0.36 ? ContingentConsiderationImpairment of ? ? ? 5.62 goodwillExecutive transition ? 0.01 ? 0.20 costsHeadquarters ? 0.02 ? 0.03 relocation costsContested proxy andother legal and 0.05 ? 0.12 ? consulting costsCash tax impact ofadjustments to GAAP (0.01 ) (0.01 ) (0.02 ) (0.02 ) net incomeNon-cash income tax (0.01 ) (1.24 ) (0.02 ) 0.15 (benefit) expenseNon-GAAP net income $ 1.28 $ 0.09 $ 2.32 $ 1.00 per shareWeighted averageshares outstanding 49,385 48,092 49,241 48,172 used in computing perdiluted share amounts

Adjusted EBITDA Reconciliation for Forward-Looking Guidance (1)(Amounts in thousands)

Rangesforthethreemonthsending Rangesfortheyearending September 30, 2021 December 31, 2021 Low High Low HighNet income $ (34,000 ) $ (30,500 ) $ (8,500 ) $ 1,000 (loss)Stock-based 5,400 5,200 21,700 21,300 compensationDepreciationandamortization 12,200 12,000 46,100 45,600 of acquiredintangibleassetsOther loss, 8,400 8,000 32,600 31,900 netAcquisition,integration,andcontestedproxy and 3,100 2,800 38,100 37,400 other legalandconsultingcosts ^(4)Income tax (1,600 ) (1,500 ) 1,500 1,800 expenseAdjusted $ (6,500 ) $ (4,000 ) $ 131,500 $ 139,000 EBITDA

Non-GAAP Net Income and Non-GAAP Net Income Per Share Reconciliation for Forward-Looking Guidance (1)(Amounts in thousands, except per share amounts)

Rangesforthethreemonthsending Rangesfortheyearending September 30, 2021 December 31, 2021 Low High Low HighNet income $ (34,000 ) $ (30,500 ) $ (8,500 ) $ 1,000 (loss)Stock-based 5,400 5,200 21,700 21,300 compensationAmortizationof acquired 7,000 7,000 28,300 28,200 intangibleassetsAcquisition,integration,and contestedproxy and 3,100 2,800 38,100 37,400 other legaland consultingcosts ^(4)Cash taximpact of (500 ) (400 ) (2,200 ) (2,000 ) adjustments tonet lossNon-cashincome tax ? (100 ) (1,400 ) (1,400 ) benefitNon-GAAP net $ (19,000 ) $ (16,000 ) $ 76,000 $ 84,500 incomePer diluted share:Net income $ (0.69 ) $ (0.62 ) $ (0.17 ) $ 0.02 (loss) ^(3)Stock-based 0.11 0.11 0.43 0.43 compensationAmortizationof acquired 0.14 0.13 0.57 0.57 intangibleassetsAcquisition,integration,and contestedproxy and 0.06 0.06 0.76 0.75 other legaland consultingcosts ^(4)Cash taximpact of (0.01 ) (0.01 ) (0.04 ) (0.04 ) adjustments tonet lossNon-cashincome tax ? ? (0.03 ) (0.03 ) benefitNon-GAAP netincome per $ (0.39 ) $ (0.33 ) $ 1.52 $ 1.70 shareWeightedaverage sharesoutstandingused in 49,100 49,000 50,000 49,800 computing perdiluted shareamounts

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

(1) We define Adjusted EBITDA as net income (loss), determined in accordance with GAAP, excluding the effects of stock-based compensation, depreciation and amortization of acquired intangible assets, other loss, net, acquisition and integration costs, impairment of goodwill, executive transition costs, headquarters relocation costs, contested proxy and other legal and consulting costs, and income tax benefit (expense). Other loss, net primarily constitutes our interest expense, net of interest income. Acquisition and integration costs primarily relate to the acquisition of HKFS and the acquisition of 1st Global, including the increase to the contingent liability reserve related to a regulatory inquiry assumed in the acquisition of 1st Global. Impairment of goodwill relates to the impairment of our Wealth Management reporting unit goodwill in the first quarter of 2020. Executive transition costs relate to the departure of certain Company executives in the first quarter of 2020. Headquarters relocation costs relate to the process of moving from our Dallas and Irving offices to our new headquarters.

We believe that Adjusted EBITDA provides meaningful supplemental information regarding our performance. We use this non-GAAP financial measure for internal management and compensation purposes, when publicly providing guidance on possible future results, and as a means to evaluate period-to-period comparisons. We believe that Adjusted EBITDA is a common measure used by investors and analysts to evaluate our performance, that it provides a more complete understanding of the results of operations and trends affecting our business when viewed together with GAAP results, and that management and investors benefit from referring to this non-GAAP financial measure. Items excluded from Adjusted EBITDA are significant and necessary components to the operations of our business and, therefore, Adjusted EBITDA should be considered as a supplement to, and not as a substitute for or superior to, GAAP net income (loss). Other companies may calculate Adjusted EBITDA differently and, therefore, our Adjusted EBITDA may not be comparable to similarly titled measures of other companies.

We define non-GAAP net income as net income (loss), determined in accordance with GAAP, excluding the effects of stock-based compensation, amortization of acquired intangible assets, acquisition and integration costs, impairment of goodwill, executive transition costs, headquarters relocation costs, contested proxy and other legal and consulting costs, the related cash tax impact of those adjustments, and non-cash income tax (benefit) expense. We exclude the non-cash portion of income tax expense because of our ability to offset a substantial portion of our cash tax liabilities by using deferred tax assets, which primarily consist of U.S. federal net operating losses. The majority of these net operating losses will either be utilized or expire between 2021 and 2024.

We believe that non-GAAP net income and non-GAAP net income per share provide meaningful supplemental information to management, investors, and analysts regarding our performance and the valuation of our business by excluding items in the statement of operations that we do not consider part of our ongoing operations or have not been, or are not expected to be, settled in cash. Additionally, we believe that non-GAAP net income and non-GAAP net income per share are common measures used by investors and analysts to evaluate our performance and the valuation of our business. Non-GAAP net income and non-GAAP net income per share should be evaluated in light of our financial results prepared in accordance with GAAP and should be considered as a supplement to, and not as a substitute for or superior to, GAAP net income (loss) and net income (loss) per share. Other companies may calculate non-GAAP net income and non-GAAP net income per share differently, and, therefore, our non-GAAP net income and non-GAAP net income per share may not be comparable to similarly titled measures of other companies.

(2) As presented in the condensed consolidated statements of operations (unaudited).

(3) Any difference in the per diluted share amounts between this table and the condensed consolidated statements of comprehensive income is due to using different weighted average shares outstanding in the event that there is GAAP net loss but non-GAAP net income and vice versa.

(4) The breakout of components cannot be determined on a forward-looking basis without unreasonable efforts.