Marin Software Inc (MRIN) 2015年年度報告「NYSE」.pdf

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1、UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549FORM 10-KxxAnnual Report pursuant to Section 13 or 15(d)of the Securities Exchange Act of 1934For the fiscal year ended December 31,2015ORooTransition report pursuant to Section 13 or 15(d)of the Securities Exchange Act of 1934Commis

2、sion File Number:001-35838Marin Software Incorporated(Exact name of registrant as specified in its charter)Delaware20-4647180(State or other jurisdiction ofincorporation or organization)(I.R.S.EmployerIdentification Number)123 Mission Street,27th FloorSan Francisco,CA 94105(415)399-2580(Address,incl

3、uding zip code,and telephone number,including area code,of registrants principal executive offices)Securities registered pursuant to Section 12(b)of the Act:Title of each class Name of each exchange on which registeredCommon stock,par value$0.001 per share New York Stock Exchange,Securities register

4、ed pursuant to section 12(g)of the Act:Not applicableIndicatebycheckmarkiftheRegistrantisawell-knownseasonedissuer,asdefinedinRule405oftheSecuritiesAct.YesoNoxIndicatebycheckmarkiftheRegistrantisnotrequiredtofilereportspursuanttoSection13orSection15(d)ofAct.YesoNoxIndicatebycheckmarkwhethertheRegist

5、rant(1)hasfiledallreportsrequiredtobefiledbySection13or15(d)oftheSecuritiesExchangeActof1934duringthepreceding12months(orforsuchshorterperiodthattheRegistrantwasrequiredtofilesuchreports),and(2)hasbeensubjecttosuchfilingrequirementsforthepast90days:YesxNooIndicatebycheckmarkwhethertheRegistranthassu

6、bmittedelectronicallyandpostedonitscorporateWebsite,ifany,everyInteractiveDataFilerequiredtobesubmittedandpostedpursuanttoRule405ofRegulationS-T(232.405ofthischapter)duringthepreceding12months(orforsuchshorterperiodthattheRegistrantwasrequiredtosubmitandpostsuchfiles).YesxNooIndicatebycheckmarkifdis

7、closureofdelinquentfilerspursuanttoItem405ofRegulationS-K(229.405ofthischapter)isnotcontainedherein,andwillnotbecontained,tothebestofRegistrantsknowledge,indefinitiveproxyorinformationstatementsincorporatedbyreferenceinPartIIIofthisForm10-KoranyamendmenttothisForm10-K.xIndicatebycheckmarkwhethertheR

8、egistrantisalargeacceleratedfiler,anacceleratedfiler,anon-acceleratedfilerorasmallerreportingcompany.Seethedefinitionsof“largeacceleratedfiler,”“acceleratedfiler”and“smallerreportingcompany”inRule12b-2oftheExchangeAct.(Checkone):Largeacceleratedfiler o Acceleratedfiler xNon-acceleratedfiler o Smalle

9、rreportingcompany oIndicatebycheckmarkwhethertheRegistrantisashellcompany(asdefinedinRule12b-2oftheAct).YesoNoxBasedontheclosingpriceoftheRegistrantsCommonStockontheNewYorkStockExchangeof$6.74onthelastbusinessdayoftheRegistrantsmostrecentlycompletedsecondfiscalquarter,whichwasJune30,2015,theaggregat

10、emarketvalueofitssharesheldbynon-affiliateswasapproximately$153million.SharesoftheRegistrantsCommonStockheldbyeachexecutiveofficeranddirectorandbyeachentityorpersonthatowned5percentormoreoftheRegistrantsoutstandingCommonStockwereexcludedinthatsuchpersonsmaybedeemedtobeaffiliates.Thisdeterminationofa

11、ffiliatestatusisnotnecessarilyaconclusivedeterminationforotherpurposes.AsofFebruary16,2016,therewereapproximately37.9millionsharesoftheRegistrantsCommonStockoutstanding.DOCUMENTS INCORPORATED BY REFERENCEPortionsoftheRegistrantsdefinitiveproxystatementforits2016AnnualMeetingofStockholders(“ProxyStat

12、ement”),tobefiledwithin120daysoftheRegistrantsfiscalyearendedDecember31,2015,areincorporatedbyreferenceinPartIIIofthisAnnualReportonForm10-K.ExceptwithrespecttoinformationspecificallyincorporatedbyreferenceinthisForm10-K,theProxyStatementisnotdeemedtobefiledaspartofthisAnnualReportonForm10-K.MARIN S

13、OFTWARE INCORPORATEDFORM 10-KFor the Fiscal Year Ended December 31,2015TABLE OF CONTENTS Page PART I.4Item1.Business4Item1A.RiskFactors8Item1B.UnresolvedStaffComments25Item2.Properties25Item3.LegalProceedings25Item4.MineSafetyDisclosures25PART II.26Item5.MarketforRegistrantsCommonEquity,RelatedStock

14、holderMattersandIssuerPurchasesofEquitySecurities26Item6.SelectedConsolidatedFinancialData29Item7.ManagementsDiscussionandAnalysisofFinancialConditionandResultsofOperations31Item7A.QuantitativeandQualitativeDisclosuresAboutMarketRisk49Item8.FinancialStatementsandSupplementaryData50Item9.Changesinand

15、DisagreementswithAccountantsonAccountingandFinancialDisclosure50Item9A.ControlsandProcedures50Item9B.OtherInformation51PART III.52Item10.Directors,ExecutiveOfficersandCorporateGovernance52Item11.ExecutiveCompensation52Item12.SecurityOwnershipofCertainBeneficialOwnersandManagementandRelatedStockholde

16、rMatters52Item13.CertainRelationshipsandRelatedTransactions,andDirectorIndependence52Item14.PrincipalAccountantFeesandServices52PART IV.53Item15.ExhibitsandFinancialStatementSchedules53IndextoConsolidatedFinancialStatements54Signatures812SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTSThisAnnualRep

17、ortonForm10-K,includingthe“ManagementsDiscussionandAnalysisofFinancialConditionandResultsofOperations,”containsforward-lookingstatementsregardingfutureeventsandourfutureresults,includingstatementsregardingthecapabilitiesofourtechnologyplatformandupgradestotheplatform,productcapabilitiesandtheirbenef

18、itsforourcustomers,andexpectationsastofinancialperformance,thataresubjecttothesafeharborscreatedundertheSecuritiesActof1933,asamended,andtheSecuritiesExchangeActof1934,asamended.AllstatementscontainedinthisAnnualReportonForm10-Kotherthanstatementsofhistoricalfact,includingstatementsregardingourfutur

19、eresultsofoperationsandfinancialposition,ourbusinessstrategyandplans,andourobjectivesforfutureoperations,areforward-lookingstatementswithinthemeaningofthePrivateSecuritiesLitigationReformActof1995.Thewords“believe,”“may,”“potentially,”“will,”“estimate,”“continue,”“anticipate,”“intend,”“could,”“shoul

20、d,”“would,”“project,”“plan,”“predict,”“expect,”“seek,”andsimilarexpressionsareintendedtoidentifyforward-lookingstatements.Wehavebasedtheseforward-lookingstatementslargelyonourcurrentexpectations,estimatesandprojectionsaboutfutureeventsandtrendsthatwebelievemayaffectourfinancialcondition,resultsofope

21、rations,businessstrategy,short-termandlong-termbusinessoperationsandobjectives,andfinancialneeds.ThesestatementsreflectourbeliefsandcertainassumptionsbaseduponinformationavailabletousatthetimewefilethisAnnualReportonForm10-Korthetimeofthedocumentsincorporatedbyreference.Suchforward-lookingstatements

22、areonlypredictions,whichmaydiffermateriallyfromactualresultsorfutureevents.Althoughwebelievethatourexpectations,estimatesandprojectionsreflectedintheforward-lookingstatementsarereasonable,wecannotbesurethattheywillbeachieved.Theseforward-lookingstatementsaresubjecttoanumberofrisks,uncertaintiesandas

23、sumptions,includingthosedescribedinthe“RiskFactors”section.Moreover,weoperateinaverycompetitiveandrapidlychangingenvironment.Newrisksemergefromtimetotime.Itisnotpossibleforourmanagementtopredictallrisks,norcanweassesstheimpactofallfactorsonourbusinessortheextenttowhichanyfactor,orcombinationoffactor

24、s,maycauseactualresultstodiffermateriallyfromthosecontainedinanyforward-lookingstatementswemaymake.Inlightoftheserisks,uncertaintiesandassumptions,thefutureeventsandtrendsdiscussedinthisreportmaynotoccurandactualresultscoulddiffermateriallyandadverselyfromthoseanticipatedorimpliedintheforward-lookin

25、gstatements.Weundertakenoobligationtoreviseorpubliclyreleasetheresultsofanyrevisiontotheseforward-lookingstatements,exceptasrequiredbylaw.Giventheserisksanduncertainties,readersarecautionednottoplaceunduerelianceonsuchforward-lookingstatements.Asusedinthisreport,theterms“Marin,”“Registrant,”“we,”“us

26、,”“our,”and“theCompany”meanMarinSoftwareIncorporatedanditssubsidiariesunlessthecontextindicatesotherwise.3PART IITEM 1.BUSINESSWeprovidealeadingcross-channeladvertisingcloudplatformthatenablesdigitalmarketerstoimproveperformanceoftheironlineadvertisingcampaignsacrossdevices,realizeefficienciesandtim

27、esavings,andmakebetterbusinessdecisions.Ourintegratedplatformisasoftware-as-a-service,orSaaS,analytics,workflowandoptimizationsolutionformarketingprofessionals,allowingthemtoeffectivelymanagetheirdigitaladvertisingspendacrosssearch,socialanddisplaychannels.Oursoftwaresolutionisdesignedtohelpourcusto

28、mers:measuretheeffectivenessoftheiradvertisingcampaignsthroughourproprietaryreportingandanalyticscapabilities;manageandexecutecampaignsthroughourintuitiveuserinterfaceandunderlyingtechnologythatstreamlinesandautomateskeyfunctions,suchasadcreationandbidding,acrossmultiplepublishersandchannels;andopti

29、mizecampaignsacrossmultiplepublishersandchannelsbasedonmarketandbusinessdatatoachievedesiredrevenueoutcomesusingourpredictivebidmanagementtechnology.Advertisersuseourplatformtocreate,targetandconvertpreciseaudiencesbasedonrecentbuyingsignalsfromuserssearch,socialanddisplayinteractions.Ourplatformisi

30、ntegratedwithleadingpublisherssuchasBaidu,Bing,Facebook,Google,Twitter,Yahoo!,Yahoo!JapanandYandex.Additionally,wehaveintegrationswithmorethan50leadingwebanalyticsandad-servingsolutionsandkeyenterpriseapplications,enablingourcustomerstomoreaccuratelymeasurethereturnoninvestmentoftheirmarketingprogra

31、ms.Oursoftwareplatformservesasanintegrationpointforadvertisingperformance,salesandrevenuedata,allowingadvertiserstoconnectthedotsbetweenadvertisingspendandrevenueoutcomes.Throughanintuitiveinterface,weenableourcustomerstosimultaneouslyrunlarge-scaledigitaladvertisingcampaignsacrossmultiplepublishers

32、andchannels,makingiteasyformarketerstocreate,publish,modifyandoptimizecampaigns.Ourpredictivebidmanagementandoptimizationtechnologyalsoallowsadvertiserstoforecastoutcomesandoptimizecampaignsacrossmultiplepublishersandchannelstoachievetheirbusinessgoals.Ouroptimizationtechnologycanhelpadvertisersincr

33、easeadspendonthosecampaigns,publishersandchannelsthatareperformingwellwhilereducinginvestmentinthosethatarenot.Thiscategoryofsolutions,whichwerefertoascross-channelbidandcampaignoptimization,helpsbusinessesintelligentlyandefficientlymeasure,manage,andoptimizetheirdigitaladvertisingspendtoachievedesi

34、redbusinessresults.WecompletedouracquisitionsofSocialMoovS.A.S.,orSocialMoov,andNowSpots,Inc.,whichconductedbusinessasPerfectAudience,orPerfectAudience,inFebruary2015andJune2014,respectively,tocomplementourproductofferings.SocialMoovprovidesasoftwareplatformthatoffersadvertisersandagenciesnovelsocia

35、ladvertisingtoolsdesignedtoincreaseengagementandreturnoninvestment,includingFacebookvideoadvertising,Twitterapplicationprograminterface,orAPI,integrationandtelevisionsynchronization.PerfectAudienceoffersadvertisersaSaaSdemand-sideplatformtopurchasedisplayimpressionsandretargetaudiencesacrosstheweb,F

36、acebookandTwitter.PerfectAudienceexpandedourcross-channelcapabilitiesbyaddingnewprogrammaticdisplayandsocialadvertisingfunctionalitywhileexpandingouraudienceretargetingtools.TheseacquisitionsaremorefullydescribedinNote3totheConsolidatedFinancialStatements.HeadquarteredinSanFrancisco,wewerefoundedin2

37、006.Themailingaddressofourheadquartersis123MissionStreet,27thFloor,SanFrancisco,California94105andourtelephonenumberatthatlocationis(415)399-2580.AsofDecember31,2015,ourcustomerscollectivelymanagedmorethan$7.8billioninannualizedadspendonourplatform,whichwebelievemakesusthelargestproviderofindependen

38、tadvertisingcloudsolutions.Offered SolutionsOurcloud-basedplatformhelpsourcustomerstomeasure,manageandoptimizetheirdigitalmarketingcampaignstoimproveperformanceoftheironlineadvertisingcampaigns,realizeefficienciesandtimesavings,andmakebetterbusinessdecisions.Weoffersolutionsfordirectadvertisersofall

39、sizesandtheagenciesthatrepresentthem,includingenterprise,mid-marketorsmallbusinesses.WeofferSaaSsolutionsforsearch,socialanddisplayaswellasmanagedservicesfordisplayandsocial.4SearchWeoffertwoeditionsofoursearchplatformthatleveragethesameunderlyingtechnology.EnterpriseEdition.Targetinglargeadvertiser

40、sandagencies,MarinEnterpriseisdesignedtoprovidedigitaladvertiserswiththepower,scaleandflexibilityrequiredtomanagelarge-scaleadvertisingcampaigns.ProfessionalEdition.Targetingmid-marketadvertisersandagencies,MarinProfessionalisdesignedforrapiddeploymentandofferscustomersacompleteworkflow,analysisando

41、ptimizationsolutionformanagingdigitaladvertising.Oursearchplatformiscomprisedofthefollowingmodules:Optimization.OurOptimizationmodulehelpadvertisersmanagebidsacrosspublisherstomeetrevenuegoalsandidentifyopportunitiesforcampaignimprovements,whichwebelievecanimprovefinancialperformanceandefficiencies.

42、ReportingandAnalytics.OurReportingandAnalyticsmoduleenablesadvertiserstoreportresultsatabusinesslevelandanalyzecross-channelperformancetrends,whichwebelievecanleadtoimprovedvisibilityandgeneratesignificanttimesavings.CampaignManagement.OurCampaignManagementmoduleprovidesthedigitaladvertiserwithaunif

43、iedinterfacetocreate,manageandoptimizecampaignsacrossabroadrangeofpublishers,creatinggreaterefficienciesandincreasingflexibility.Connect.OurConnectmoduleenablesadvertiserstoautomateandstreamlinethecaptureofrevenue,costandaudiencedatafromarangeofsourcessuchasadservers,analyticssystems,CRMplatforms,pu

44、blishersandthirdpartydatabases.Throughintegrationsacrossmultipledatasources,ourConnectmodulecanhelpadvertisershaveaholisticpictureoftheirdigitaladvertisingcampaigns.SocialTargetingagenciesandadvertisersofallsizes,MarinSocialisdesignedtoprovidedigitalmarketerswiththepower,scaleandflexibilitytoexecute

45、advertisingcampaignsacrossmultiplesocialnetworks.DisplayWeoffertwoeditionsofourdisplayplatformthatleveragethesameunderlyingtechnology.MarinDisplay.Targetinglargeadvertisersandagencies,MarinDisplayisdesignedtoprovidedigitaladvertiserswiththepower,scaleandflexibilityrequiredtomanagelarge-scaleadvertis

46、ingcampaignsacrossallmajornetworksandacrossdevices.PerfectAudience.Targetingsmallbusinesses,PerfectAudienceisdesignedforrapiddeploymentandofferscustomersandeasy-to-useinterfacetoimplementandoptimizecampaignsacrossallmajornetworksandacrossdevices.Technology&Supporting PlatformWedesignedourcloud-based

47、platformtosupportlargeglobaladvertisers.ThemajorityofoursoftwareiswritteninJava.Ourhardwareconsistsofindustry-standardserversandnetworkinfrastructure.OurstandardoperatingsystemisLinux.Oursoftwareplatformischaracter-set,language,currency,andtime-zoneindependent.Ourtechnologyplatformhasthefollowingkey

48、benefits:Scalability.Ourplatformisdesignedtohandlebillionsofadunitsacrossthousandsofadvertisers,whiledeliveringaresponsivebrowsingandeditingexperience.Asthenumberofadvertisersandresultingcomputingandstoragerequirementsgrow,wecanaddhardwaretoourplatformtoaccommodategrowingdemand.Availability.Ourcusto

49、mersarehighlydependentontheavailabilityofourplatform,whichisdesignedtobeavailable24x7,365daysayear.Weoperateourownhardwareandusethird-partydatacentersthatofferserverredundancy,back-upcommunicationsandpowerandphysicalsecurity.Security.Ourplatformmanagesalargequantityofcustomerdata.Weemploytechnologie

50、s,policiesandprocedurestoprotectcustomerdata.Ourprimarythird-partydatacenterhasSSAE16attestations.Weareintheprocessofupgradingoursoftwareplatform,whichwebelievewillcost-effectivelyextendthescalability,speed,resiliencyandavailabilityofourservicesandfacilitateourabilitytoaddnewfeaturestoourproducts.5C

51、ustomersWemarketandselloursolutionstoadvertisersdirectlyandthroughadvertisingagenciesthatuseourplatformonbehalfoftheircustomers.Advertisersthatweservethroughourrelationshipswithagencieshavehistoricallyrepresentedabouthalfourrevenues.Therewerenocustomersthataccountedforgreaterthan10%ofourrevenues,net

52、in2015,2014or2013.CompetitionThedigitaladvertisingcloudmarketishighlycompetitive,fragmented,andsubjecttochangesinbothtechnologyandcustomerbehavior.Wefacesignificantcompetitiontodayandexpectcompetitiontointensifyinthefuture.Tomaintainandimproveourcompetitiveposition,wemustkeeppacewiththeevolvingneeds

53、ofourcustomersandcontinuetodevelopandintroducenewmodules,featuresandservicesinatimelyandefficientmanner.Wecurrentlycompetewithlarge,well-establishedcompanies,suchasAdobeSystemsIncorporatedandGoogleInc.(throughitswholly-ownedsubsidiaryDoubleClick),andprivately-heldcompanies,suchasKenshooLtd.Wealsocom

54、petewithin-houseproprietarytools,toolsfrompublishersandcustomsolutions,includingspreadsheets.Webelievetheprincipalcompetitivefactorsinourmarketincludethefollowing:solutionquality,breadth,stability,flexibilityandfunctionality;tangibleplatformbenefits;levelofcustomersatisfactionandourabilitytorespondt

55、ocustomerneedsrapidly;breadthandqualityofadvertiserandagencyrelationships;abilitytoinnovateanddevelopneworimprovedproductsandfeatureswhilemaintainingplatformspeedandstability;abilitytorespondtochangesinpublishersAPIs;brandawarenessandreputation;andsizeofcustomerbase.Apartfromcross-channelplatformcom

56、petitors,wealsocompetewithchannelsolutionsinthedisplayandsocialadvertisingmarkets.CompetitorsinthedisplayadvertisingmarketincludepubliccompaniessuchasCriteoS.A.andRocketFuelInc.,aswellasprivatelyheldcompaniessuchasAdRollInc.andMediaMath,Inc.,whileinthesocialadvertisingmarketwecompetewithpubliccompan

57、iessuchasS(throughitswholly-ownedsubsidiaryS),andprivately-heldcompaniessuchasNanigans,Inc.Ourabilitytoremaincompetitivewilllargelydependonourongoingperformanceintheareasofoursolutionbreadthanddepthaswellascustomersupport.Sales and MarketingWeselloursolutionsdirectlytoadvertisersandtoagenciesinawide

58、rangeofindustriesthroughourglobalsalesteam.Oursalescyclecanvarysubstantiallybyadvertiserandagency,butcantakeuptoninemonths.Wehaveanumberofaccountexecutivesalesteamsorganizedbygeographyandmarketsegments.Wealsohavecustomersuccessprofessionalswhoareresponsibleforlong-termcustomersatisfactionandretentio

59、n,renewal,supportanddrivinganincreaseinthevolumeofmediamanagedbycustomersonourplatform.Ourmarketingteamisfocusedondrivingawarenessanddemandgenerationacrossmajormarkets.Thisteamprovidesthoughtleadershipintheformofwhitepapers,benchmarkingreports,bylines,presentingatindustryconferencesandspeakingtothep

60、ress.Inaddition,theyareresponsibleforthecreationoffieldenablementassetssuchascasestudies,blogpostsandcorporateandproductcollateral.Research and DevelopmentOurresearchanddevelopmentteamisresponsibleforthedesign,development,andmaintenanceofourplatform.Ourresearchanddevelopmentprocessemphasizesfrequent

61、,iterativeandincrementaldevelopmentcycles.Withinourresearchanddevelopmentorganizations,wehaveseveralprojectteamsthatfocusonplatformandfeaturedevelopmentforourintegratedverticalofferingsaspartofouradvertisingcloudsolutions.Eachoftheseprojectteamsincludesengineers,qualityengineersandproductmanagers,as

62、needed,responsiblefortheinitialandongoingdevelopmentfortheirprojects.Totalresearchanddevelopmentexpensewas$33.3million,$28.8millionand$20.7millionandfortheyearsendedDecember31,2015,2014and2013,respectively.6EmployeesAsofDecember31,2015,wehadatotalof511regularfull-timeemployees,including203employeesl

63、ocatedoutsidetheUnitedStates.Althoughwehavestatutoryemployeerepresentationobligationsincertaincountries,ourUnitedStatesemployeesarenotrepresentedbyalaborunion.Wehavenotexperiencedanyworkstoppages,andweconsiderourrelationswithouremployeestobegood.Intellectual PropertyOurintellectualpropertyrightsarea

64、keycomponentofoursuccess.Werelyonacombinationofpatent,trademark,copyright,unfaircompetitionandtradesecretlaws,aswellasconfidentialityproceduresandcontractualrestrictions,toestablish,maintainandprotectourproprietaryrights.AsofDecember31,2015,wehadtwoissuedpatentsandninepatentapplicationspendingintheU

65、nitedStates.Weownandusetrademarksonorinconnectionwithourproductsandservices,includingonetrademarkregisteredwiththeEuropeanUnionandAustraliaandunregisteredcommonlawmarksandpendingtrademarkapplicationsintheUnitedStates,China,JapanandSingapore.WehavealsoregisterednumerousInternetdomainnames.Available I

66、nformationThemailingaddressofourheadquartersis123MissionStreet,27thFloor,SanFrancisco,California94105andourtelephonenumberatthatlocationis(415)399-2580.O.ThroughalinkontheInvestorCentersectionofourwebsite,wemakeavailablethefollowingfilingsassoonasreasonablypracticableaftertheyareelectronicallyfiledw

67、ithorfurnishedtotheSecuritiesandExchangeCommission(the“SEC”):ourAnnualReportonForm10-K,QuarterlyReportsonForm10-Q,CurrentReportsonForm8-K,andanyamendmentstothosereportsfiledorfurnishedpursuanttoSection13(a)or15(d)oftheSecuritiesExchangeActof1934,asamended.Allsuchfilingsarefreeofcharge.Theinformation

68、postedtoourwebsiteisnotincorporatedintothisAnnualReportonForm10-K.ThepublicmayreadandcopyanymaterialsthatwefilewiththeSECattheSECsPublicReferenceRoomat100FStreet,NE,Washington,DC20549.ThepublicmayobtaininformationontheoperationofthePublicReferenceRoombycallingtheSECat1-800-SEC-0330.TheSECalsomaintai

69、nsanInternetsitethatcontainsreports,proxyandinformationstatements,andotherinformationregardingissuersthatfileelectronicallywiththeSECatwww.sec.gov.7ITEM 1A.RI SK FACTORSOuroperationsandfinancialresultsaresubjecttovariousrisksanduncertainties,includingthosedescribedbelow,whichcouldadverselyaffectourb

70、usiness,resultsofoperations,cashflows,financialconditions,andthetradingpriceofourcommonstock.Risks Related to Our BusinessWehaveahistoryoflossesandwemaynotachieveorsustainprofitabilityinthefuture.Wehaveincurredsignificantlossesineachfiscalyearsinceourincorporationin2006.Weexperiencednetlossesof$33.3

71、millionand$33.2millionduring2015and2014,respectively.AsofDecember31,2015,wehadanaccumulateddeficitof$179.7million.Thelossesandaccumulateddeficitwereduetothesubstantialinvestmentswemadetogrowourbusinessandacquirecustomers.Weanticipatethatourcostofrevenuesandoperatingexpenseswillincreaseintheforeseeab

72、lefutureaswecontinuetoinvesttogrowourbusinessandacquirecustomersanddevelopourplatformandnewfunctionality.Theseeffortsmayprovemoreexpensivethanwecurrentlyanticipate,andwemaynotsucceedinincreasingourrevenuessufficientlytooffsetthesehigherexpenses.Manyofoureffortstogeneraterevenuesfromourbusinessarenew

73、andunproven,andanyfailuretoincreaseourrevenuesorgeneraterevenuesfromnewsolutionscouldpreventusfromattainingorincreasingprofitability.Furthermore,totheextentwearesuccessfulinincreasingourcustomerbase,wealsocouldincurincreasedlossesbecausecostsassociatedwithenteringintocustomercontractsaregenerallyinc

74、urredupfront,whilecustomersarebilledoverthetermofthecontractgenerallythroughourusage-basedpricingmodel.Wedonotexpecttobeprofitablein2016onthebasisofgenerallyacceptedaccountingprinciplesintheUnitedStates,orGAAP,andwecannotbecertainthatwewillbeabletoattainprofitabilityonaquarterlyorannualbasis,orifwed

75、o,thatwewillsustainprofitability.Ourlimitedoperatinghistorymakesitdifficulttoevaluateourcurrentbusinessandfutureprospects.AlthoughwebeganouroperationsinMarch2006,wedidnotbegingeneratingsubstantialrevenuesuntil2009.Ourlimitedoperatinghistorymaymakeitdifficulttoevaluateourcurrentbusinessandourfuturepr

76、ospects.Wehaveencounteredandwillcontinuetoencounterrisksanddifficultiesfrequentlyexperiencedbygrowingcompaniesinrapidlydevelopingandchangingindustries,includingchallengesinforecastingaccuracy,hiringandretainingqualifiedemployees,determiningappropriateinvestmentsofourlimitedresources,marketacceptance

77、ofourexistingandfuturesolutions,effectivelyintegratingacquiredproducts,competitionfromestablishedcompanieswithgreaterfinancialandtechnicalresources,acquiringandretainingcustomers,managingcustomerdeployments,makingimprovementstoourexistingproductsanddevelopingnewsolutions.Ourcurrentoperationsinfrastr

78、ucturemayrequirechangesinorderforustoachieveprofitabilityandscaleouroperationsefficiently.Forexample,wemayneedtoautomateportionsofoursolutiontodecreaseourcosts,ensureourmarketinginfrastructureisdesignedtodrivehighlyqualifiedleadscosteffectivelyandimplementchangesinoursalesmodeltoimprovethepredictabi

79、lityofoursalesandreduceoursalescycle.Ifwefailtoimplementthesechangesonatimelybasisorareunabletoimplementthemduetofactorsbeyondourcontrol,ourbusinessmaysuffer,ourrevenuemaydeclineandwemaynotbeabletoachievefurthergrowthorprofitability.Wecannotassureyouthatwewillbesuccessfulinaddressingtheseandothercha

80、llengeswemayfaceinthefuture.Ourusage-basedpricingmodelmakesitdifficulttoforecastrevenuesfromourcurrentcustomersandfutureprospects.Weprimarilyhaveausage-basedpricingmodelinwhichmostofourfeesarecalculatedasapercentageofcustomersadvertisingspendmanagedonourplatform.Thispricingmodelmakesitdifficulttoacc

81、uratelyforecastrevenuesbecauseourcustomersadvertisingspendmanagedbyourplatformmayvaryfrommonthtomonthbasedonthevarietyofindustriesinwhichouradvertisersoperate,theseasonalityofthoseindustriesandfluctuationsinourcustomersadvertisingbudgetsorotherfactors.Oursubscriptioncontractswithourdirectadvertiserc

82、ustomersgenerallycontainaminimummonthlyplatformfee,whichisgenerallygreaterthanone-halfofourestimatedmonthlyrevenuesfromthecustomeratthetimethecontractissigned,and,asaresult,theminimummonthlyplatformfeemaynotbeagoodindicatorofourrevenuesfromthatcustomer.Inaddition,advertisersthatuseourplatformthrough

83、ouragencycustomerstypicallydonothaveaminimummonthlyspendamountoraminimumtermduringwhichtheymustuseourplatform,andasaresult,ourabilitytoforecastrevenuesfromtheseadvertisersisdifficult.Ifweincorrectlyforecastrevenuesfortheseadvertisersandtheamountofrevenueislessthanprojectionsweprovidetoinvestors,thep

84、riceofourcommonstockcoulddeclinesubstantially.Additionally,ifweoverestimateusage,wemayincuradditionalexpensesinaddinginfrastructure,withoutacommensurateincreaseinrevenues,whichwouldharmourgrossmarginsandotheroperatingresults.8Ifthemarketforadvertisingcloudsolutionsgrowsmorethaninrecentyears,ourbusin

85、ess,growthprospectsandfinancialconditionwouldbeadverselyaffected.Themarketforadvertisingcloudsolutionssuchasoursisnotasmatureasthemarketforon-premisesenterprisesoftware.Oursuccesswilldependtoasubstantialextentonthecontinuedgrowthofcloudcomputingingeneralandadvertisingviacloud-basedadvertisingchannel

86、sinparticular.Whilesearchanddisplayadvertisinghasbeenusedsuccessfullyforseveralyears,marketingvianewcloud-basedadvertisingchannelssuchasmobileandsocialmediaisnotaswellestablished.Thefuturegrowthofourbusinesscouldbeconstrainedbythelevelofacceptanceandexpansionofemergingcloud-basedadvertisingchannels,

87、aswellasthecontinueduseandgrowthofexistingchannels,suchassearchanddisplayadvertising.Evenifthesechannelsbecomewidelyadopted,advertisersandagenciesmaynotmakesignificantinvestmentsinsolutionssuchasoursthathelpthemmanagetheirdigitaladvertisingspendacrosspublisherplatformsandadvertisingchannels.Itisdiff

88、iculttopredictcustomeradoptionrates,customerdemandforourplatform,thefuturegrowthrateandsizeoftheadvertisingcloudsolutionsmarketortheentryofcompetitivesolutions.Thecontinuedexpansionofthemarketforadvertisingcloudsolutionsdependsonanumberoffactors,includingthecontinuedgrowthofthecloud-basedadvertising

89、market,thegrowthofsocialandmobileasadvertisingchannelsandthecost,performanceandperceivedvalueassociatedwithadvertisingcloudsolutions,aswellastheabilityofcloudcomputingcompaniestoaddresssecurityandprivacyconcerns.Further,thecloudcomputingmarketislessdevelopedinmanyjurisdictionsoutsideoftheUnitedState

90、s.Ifweorothercloudcomputingprovidersexperiencesecurityincidents,lossofcustomerdata,disruptionsindeliveryorotherproblems,themarketforcloudcomputingasawhole,includingourapplications,maybenegativelyaffected.Ifthereisareductionindemandfordigitaladvertisingcausedbyweakeningeconomicconditions,decreasesinc

91、orporatespending,securityorprivateconcernscompetingtechnologyorotherwise,itcouldresultinreducedusage,whichcoulddecreaserevenuesorotherwiseadverselyaffectourbusiness.Ifweareunabletomaintainourrelationshipswith,andaccessto,publishers,advertisingexchangeplatformsandotherplatformsthataggregatethesupplyo

92、fadvertisinginventory,ourbusinesswillsuffer.Wecurrentlydependonrelationshipswithvariouspublishers,includingBaidu,Bing,Facebook,Google,Twitter,Yahoo!,Yahoo!JapanandYandex,aswellasadvertisingexchangeplatformsandaggregatorsofadvertisinginventory,includingGooglesDoubleClickAdExchange,Yahoo!sRightMedia,F

93、acebooksExchange,MicrosoftsAdExchange,TwittersMoPubandAppNexus.OursubscriptionservicesinterfacewiththesepublishersplatformsthroughAPIs,suchastheGoogleAdWordsAPIorFacebookAPI.WearesubjecttotherespectiveplatformsstandardAPItermsandconditions,whichgoverntheuseanddistributionofdatafromtheseplatforms.Our

94、businesssignificantlydependsonhavingaccesstotheseAPIs,particularlytheGoogleAdWordsAPI,whichthesubstantialmajorityofourcustomersuse,oncommerciallyreasonabletermsandourbusinesswouldbeharmedifanyofthesepublishers,advertisingexchangesoraggregatorsofadvertisinginventorydiscontinuesorlimitsaccesstotheirpl

95、atforms,modifiestheirtermsofuseorotherpoliciesorplaceadditionalrestrictionsonusasAPIusers,orchargesAPIlicensefeesforAPIaccess.Moreover,someofthesepublishers,suchasGoogle,marketcompetitivesolutionsfortheirplatforms.BecausetheadvertisinginventorysupplierscontroltheirAPIs,theymaydevelopcompetitiveoffer

96、ingsthatarenotsubjecttothelimitsimposedonusthroughtheAPItermsandconditions.Currently,restrictionsintheseAPIagreementslimitourabilitytoimplementcertainfunctionality,requireustoimplementfunctionalityinaparticularmannerorrequireustoimplementcertainrequiredminimumfunctionality,causingustodevotedevelopme

97、ntresourcestoimplementcertainfunctionalitythatwewouldnototherwiseincludeinoursubscriptionservicesandtoincurcostsforpersonneltoprovideservicestoimplementfunctionalitythatweareprohibitedfromautomating.Publishers,advertisingexchangesandadvertisinginventoryaggregatorsupdatetheirAPItermsofusefromtimetoti

98、meandnewversionsofthesetermscouldimposeadditionalrestrictionsonus.Inaddition,publishers,advertisingexchangesandadvertisinginventoryaggregatorscontinuallyupdatetheirAPIsandmayupdateormodifyfunctionality,whichrequiresustomodifyoursoftwaretoaccommodatethesechangesandtodevotetechnicalresourcesandpersonn

99、eltotheseeffortswhichcouldotherwisebeusedtofocusonotherpriorities.Anyoftheseoutcomescouldcausedemandforourproductstodecrease,ourresearchanddevelopmentcoststoincrease,andourresultsofoperationsandfinancialconditiontobeharmed.Ourgrowthdependsinpartonthesuccessofourrelationshipswithadvertisingagencies.O

100、urfuturegrowthwilldepend,inpart,onourabilitytoenterintosuccessfulrelationshipswithadvertisingagencies.Identifyingagenciesandnegotiatinganddocumentingrelationshipswiththemrequiressignificanttimeandresources.Theserelationshipsmaynotresultinadditionalcustomersorenableustogeneratesignificantrevenues.Our

101、contractsfortheserelationshipsaretypicallynon-exclusiveanddonotprohibittheagencyfromworkingwithourcompetitorsorfromofferingcompetingservices.Frequently,theseagenciesdoinfactworkwithourcompetitorsandcompetewithus.Inaddition,weoftenworkwith,orseektoworkwith,high-profilebrandsdirectly.Thismaynotbepossi

102、blewhere,forexample,thosebrandsobtainadvertisingservicesexclusivelyorprimarilyfromadvertisingagencies.9Wegenerallybillagenciesfortheircustomersuseofourplatform,butinmostcasestheagencyscustomerhasnodirectcontractualcommitmenttomakepaymenttous.Furthermore,someoftheseagencycontractsincludeprovisionswhe

103、rebytheagencyisnotliableformakingpaymenttousforoursubscriptionservicesiftheagencydoesnotreceiveacorrespondingpaymentfromitsclientonwhosebehalfthesubscriptionserviceswererendered.Theseprovisionsmayresultinlongercollectionsperiodsorourinabilitytocollectpaymentforsomeofoursubscriptionservices.Ifweareun

104、successfulinestablishingormaintainingourrelationshipswiththeseagenciesoncommerciallyreasonableterms,oriftheserelationshipsarenotprofitableforus,ourabilitytocompeteinthemarketplaceortogrowourrevenuescouldbeimpairedandouroperatingresultswouldsuffer.Wemaynotbeabletocompetesuccessfullyagainstcurrentandf

105、uturecompetitors.Theoverallmarketforadvertisingcloudsolutionsisrapidlyevolving,highlycompetitive,complex,fragmented,andsubjecttochangingtechnologyandshiftingcustomerneeds.Wefacesignificantcompetitioninthismarketandweexpectcompetitiontointensifyinthefuture.Wecurrentlycompetewithlarge,well-established

106、companies,suchasAdobeSystemsIncorporatedandGoogleInc.(throughitswholly-ownedsubsidiaryDoubleClick),andprivately-heldcompanies,suchasKenshooLtd.Wealsocompetewithchannel-specificofferings,in-houseproprietarytools,toolsfrompublishersandcustomsolutions,includingspreadsheets.Increasedcompetitionmayresult

107、inreducedpricingforoursolutions,longersalescyclesoradecreaseofourmarketshare,anyofwhichcouldnegativelyaffectourrevenuesandfutureoperatingresultsandourabilitytogrowourbusiness.Anumberofcompetitivefactorscouldcauseustolosepotentialsalesortoselloursolutionsatlowerpricesoratreducedmargins,including,amon

108、gothers:potentialcustomersmaychoosetodeveloporcontinuetouseinternalsolutionsratherthanpayingforoursolutionsormaychoosetouseacompetitorssolutionthathasdifferentoradditionaltechnicalcapabilities;companiesmayenterourmarketbyexpandingtheirplatformsoracquiringacompetitor;someofourcompetitors,suchasAdobea

109、ndGoogle,havegreaterfinancial,marketingandtechnicalresourcesthanwedo,allowingthemtoleveragealargerinstalledcustomerbase,adoptmoreaggressivepricingpolicies,anddevotegreaterresourcestothedevelopment,promotionandsaleoftheirproductsandservicesthanwecan;channel-specificcompetitors,suchasAdRollInc,CriteoS

110、.A.,MediaMath,Inc.,Nanigans,Inc.,RocketFuelInc.andS(throughitswholly-ownedsubsidiaryS),maydevotegreaterresourcestothedevelopment,promotionandsaleoftheirchannel-specificproductsandservicesthanwecan;andpublishersgenerallyoffertheirtoolsforfree,oratareducedprice,astheirprimarycompensationisviathesaleof

111、advertisingontheirownorsyndicatedwebsites.Wecannotassureyouthatwewillbeabletocompetesuccessfullyagainstcurrentandfuturecompetitors.Ifwecannotcompetesuccessfully,ourbusiness,resultsofoperationsandfinancialconditioncouldbenegativelyimpacted.Ourbusinessdependsonourcustomerscontinuedwillingnesstomanagea

112、dvertisingspendonourplatform.Inorderforustoimproveouroperatingresults,itisimportantthatourcustomerscontinuetomanagetheiradvertisingspendonourplatform,increasetheirusageandalsopurchaseadditionalsolutionsfromus.Inthecaseofourdirectadvertisercustomers,weofferoursolutionsprimarilythroughsubscriptioncont

113、ractsandgenerallybillcustomersovertherelatedsubscriptionperiod,whichisgenerallyoneyearorlonger.Duringthetermoftheircontracts,ourdirectadvertisercustomersgenerallyhavenoobligationtomaintainorincreasetheiradvertisingspendonourplatformbeyondaspecifiedminimummonthlyplatformfee,whichistypicallysetattheti

114、methecontractissignedandisgenerallygreaterthanhalfofthemonthlyamountweanticipatethecustomerwillspend.Ourdirectadvertisercustomersgenerallyhavenorenewalobligationaftertheinitialorthen-currentrenewalsubscriptionperiodexpires,andevenifcustomersrenewcontracts,theymaydecreasetheleveloftheirdigitaladverti

115、singspendmanagedthroughourplatform,resultinginlowerrevenuesfromthatcustomer.Advertisersthatweservethroughourarrangementswithouradvertisingagenciesgenerallydonothaveanycontractualcommitmenttouseourplatform.Ourcustomersusagemaydeclineorfluctuateasaresultofanumberoffactors,including,butnotlimitedto,the

116、irsatisfactionwithourplatformandourcustomersupport,thefrequencyandseverityofoutages,thepricingofour,orcompeting,solutions,theeffectsofglobaleconomicconditionsandreductionsinspendinglevelsorchangesinourcustomersstrategiesregardingdigitaladvertising.Duetoourlimitedhistoricalexperience,wemaynotbeableto

117、accuratelypredictfutureusagetrends.Ifourcustomersrenewonlessfavorabletermsorreducetheiradvertisingspendonourplatform,ourrevenuesmaygrowmoreslowlythanexpectedordecline.10Weincurupfrontcostsassociatedwithonboardingadvertiserstoourplatformandmaynotrecoupourinvestmentifwedonotmaintaintheadvertiserrelati

118、onshipovertime.Ouroperatingresultsmaybenegativelyaffectedifweareunabletorecoupourupfrontcostsforonboardingnewadvertiserstoourplatform.Upfrontcostswhenaddingnewadvertisersgenerallyincludesalescommissionsforoursalesforce,expensesassociatedwithenteringcustomerdataintoourplatformandotherimplementation-r

119、elatedcosts.Becauseourcustomers,includingdirectadvertisersandagencies,arebilledoverthetermofthecontract,ifnewcustomerssigncontractswithshortinitialsubscriptionperiodsanddonotrenewtheirsubscriptions,orotherwisedonotcontinuetouseourplatformtoalevelthatgeneratesrevenuesinexcessofourupfrontexpenses,ouro

120、peratingresultscouldbenegativelyimpacted.Incasesinwhichtheimplementationprocessisparticularlycomplex,therevenuesresultingfromthecustomerunderourcontractmaynotcovertheupfrontinvestment,soifasignificantnumberofthesecustomersdonotrenewtheircontracts,itcouldnegativelyaffectouroperatingresults.Becauseweg

121、enerallybillourcustomersoverthetermofthecontract,neartermdeclineinneworrenewedsubscriptionsmaynotbereflectedimmediatelyinouroperatingresults.Mostofourrevenuesineachquarterarederivedfromcontractsenteredintowithourcustomersduringpreviousquarters.Consequently,adeclineinneworrenewedsubscriptionsinanyone

122、quartermaynotbefullyreflectedinourrevenuesforthatquarter.Suchdeclines,however,wouldnegativelyaffectourrevenuesinfutureperiodsandtheeffectofsignificantdownturnsinsalesandmarketacceptanceofoursolutions,andpotentialchangesinourrateofrenewalsorrenewalterms,maynotbefullyreflectedinourresultsofoperationsu

123、ntilfutureperiods.Inaddition,wemaybeunabletoadjustourcoststructurerapidly,oratall,totakeaccountofreducedrevenues.Oursubscriptionmodelalsomakesitdifficultforustorapidlyincreaseourtotalrevenuesthroughadditionalsalesinanyperiod,asrevenuesfromnewcustomersmustbeearnedovertheapplicablesubscriptiontermbase

124、donthevalueoftheirmonthlyadvertisingspend.Wehavebeendependentonourcustomersuseofsearchadvertising.Anydecreaseintheuseofsearchadvertisingorourinabilitytofurtherpenetratesocialanddisplayadvertisingchannelswouldharmourbusiness,growthprospects,operatingresultsandfinancialcondition.Historically,ourcustom

125、ershaveprimarilyusedoursolutionsformanagingtheirsearchadvertising,includingmobilesearchadvertising,andthesubstantialmajorityofourrevenuesarederivedfromadvertisersthatuseourplatformtomanagetheirsearchadvertising.Weexpectthatsearchadvertisingwillcontinuetobetheprimarychannelusedbyourcustomersforthefor

126、eseeablefuture.Shouldourcustomersloseconfidenceinthevalueoreffectivenessofsearchadvertising,orifsearchadvertisinggrowthmoderatesordeclines,thedemandforoursolutionsmaydecline,anditmaynegativelyimpactourrevenues.Inaddition,ourfailuretoachievemarketacceptanceofoursolutionforthemanagementofsocialanddisp

127、layadvertisingspendwouldharmourgrowthprospects,operatingresultsandfinancialcondition.Oursalescyclecanbelongandunpredictableandrequireconsiderabletimeandexpense,whichmaycauseouroperatingresultstofluctuate.Thesalescycleforoursolutions,frominitialcontactwithapotentialleadtocontractexecutionandimplement

128、ation,varieswidelybycustomer,butcantakeuptoninemonths.Someofourcustomersundertakeasignificantevaluationprocessthatfrequentlyinvolvesnotonlyoursolutionsbutalsothoseofourcompetitors,whichhasinthepastresultedinextendedsalescycles.Oursaleseffortsinvolveeducatingourcustomersabouttheuse,technicalcapabilit

129、iesandbenefitsofourplatform.Inaddition,undercertaincircumstances,wesometimesofferaninitialterm,typicallyofafewmonthsinduration,tonewcustomerswhomayterminatetheirsubscriptionatanytimeduringthisinitialperiodbeforethefixedtermcontractcommences.Wehavenoassurancethatthesubstantialtimeandmoneyspentonoursa

130、leseffortswillproduceanysales.Ifoursaleseffortsresultinanewcustomersubscription,thecustomermayterminateitssubscriptionduringtheinitialperiod,afterwehaveincurredtheexpensesassociatedwithenteringthecustomersdatainourplatformandrelatedtrainingandsupport.Ifsalesexpectedfromacustomerarenotrealizedintheti

131、meperiodexpectedornotrealizedatall,orifacustomerterminatesduringtheinitialperiod,ourbusiness,operatingresultsandfinancialconditioncouldbeadverselyaffected.Ourabilitytogeneraterevenuedependsonourcollectionofsignificantamountsofdatafromvarioussources.Ourabilitytooptimizethedeliveryofinternetadvertisem

132、entsforourcustomersdependsonourabilitytosuccessfullyleveragedata,includingdatathatwecollectfromourcustomersaswellasdataprovidedbypublishersandfromthirdparties.Usingcookiesandsimilartrackingtechnologies,wecollectinformationabouttheinteractionofuserswithouradvertisersandpublisherswebsites.Ourabilityto

133、successfullyleveragesuchdataisdependentuponourcontinuedabilitytoaccessandutilizesuchdata.Ourabilitytoaccessandusesuchdatacouldberestrictedbyanumberoffactors,includingconsumerchoice,restrictionsimposedbyadvertisersandpublishers,changesintechnology,andnewdevelopmentsinlaws,regulations,andindustrystand

134、ards.11Ifconsumerresistancetothecollectionandsharingofthedatausedtodelivertargetedadvertising,increasedvisibilityofconsent/DoNotTrackmechanismsasaresultofindustryregulatoryand/orlegaldevelopments,and/orthedevelopmentanddeploymentofnewtechnologiesresultinamaterialimpactonourabilitytocollectdata,thisw

135、illmateriallyimpairtheresultsofouroperations.Materialdefectsorerrorsinoursoftwareplatformcouldharmourreputation,resultinsignificantcoststousandimpairourabilitytoselloursubscriptionservices.Thesoftwareapplicationsunderlyingoursubscriptionservicesareinherentlycomplexandmaycontainmaterialdefectsorerror

136、s,whichmaycausedisruptionsinavailability,misallocationofadvertisingspendorotherperformanceproblems.Anysucherrors,defects,disruptionsinserviceorotherperformanceproblemswithoursoftwareplatform,includingthoseresultingfromnewversionsorupdates,couldnegativelyimpactourcustomersbusinessesorthesuccessofthei

137、radvertisingcampaignsandcauseharmtoourreputation.Ifwehaveanyerrors,defects,disruptionsinserviceorotherperformanceproblemswithoursoftwareplatform,customerscouldelectnottoreneworreducetheirusageordelayorwithholdpaymenttous,whichcouldresultinanincreaseinourprovisionfordoubtfulaccountsoranincreaseinthel

138、engthofcollectioncyclesforaccountsreceivable.Errors,defects,disruptionsinserviceorotherperformanceproblemscouldalsoresultincustomersmakingwarrantyorotherclaimsagainstus,ourgivingcreditstoourcustomerstowardfutureadvertisingspendorcostlylitigation.Asaresult,materialdefectsorerrorsinourplatformcouldhav

139、eamaterialadverseimpactonourbusinessandfinancialperformance.Thecostsincurredincorrectinganymaterialdefectsorerrorsinoursoftwareplatformmaybesubstantialandcouldadverselyaffectouroperatingresults.Afterthereleaseofnewversionsofoursoftware,defectsorerrorsmaybeidentifiedfromtimetotimebyourinternalteamand

140、byourcustomers.Weimplementbugfixesandupgradesaspartofourregularlyscheduledsystemmaintenance.Ifwedonotcompletethismaintenanceaccordingtoscheduleorifcustomersareotherwisedissatisfiedwiththefrequencyand/ordurationofourmaintenanceservices,customerscouldelectnottorenew,ordelayorwithholdpaymenttous,orcaus

141、eustoissuecredits,makerefundsorpaypenalties.Weprimarilyderiveourrevenuesfromasinglesoftwareplatformandanyfactoradverselyaffectingsubscriptionstoourplatformcouldharmourbusinessandoperatingresults.Weprimarilyderiveourrevenuesfromsalesofasinglesoftwareplatform.Assuch,anyfactoradverselyaffectingsubscrip

142、tionstoourplatform,includingproductreleasecycles,marketacceptance,productcompetition,performanceandreliability,reputation,pricecompetition,andeconomicandmarketconditions,couldharmourbusinessandoperatingresults.Ifmobileconnecteddevices,theiroperatingsystemsorcontentdistributionchannels,includingthose

143、controlledbyourcompetitors,developinwaysthatpreventouradvertisingcampaignsfrombeingdeliveredtotheirusers,ourabilitytogrowourbusinesswillbeimpaired.Oursuccessinthemobilechanneldependsupontheabilityofourtechnologyplatformtointegratewithmobileinventorysuppliersandprovideadvertisingformostmobileconnecte

144、ddevices,aswellasthemajoroperatingsystemsthatrunonthemandtheapplicationsthataredownloadedontothem.Thedesignofmobiledevicesandoperatingsystemsiscontrolledbythirdpartieswithwhomwedonothaveanyformalrelationships.Thesepartiesfrequentlyintroducenewdevices,andfromtimetotimetheymayintroducenewoperatingsyst

145、emsormodifyexistingones.Networkcarriersmayalsoimpacttheabilitytoaccessspecifiedcontentonmobiledevices.Ifoursolutionwereunabletoworkonthesedevicesoroperatingsystems,eitherbecauseoftechnologicalconstraintsorbecauseanoperatingsystemorappdeveloper,devicemakerorcarrierwishedtoimpairourabilitytopurchasein

146、ventoryandprovideadvertisements,ourabilitytogeneraterevenuecouldbesignificantlyharmed.Weprimarilyuseasinglethird-partydatacentertodeliverourservices.Anydisruptionofserviceatthisfacilitycouldharmourbusiness.Whileweutilizetwothird-partydatacentersintotal,wemanageasignificantportionofourservicesandserv

147、esubstantiallyallofourcustomersfromonlyasinglethird-partydatacenterfacility.Whilewecontroltheactualcomputer,networkandstoragesystemsuponwhichourplatformruns,anddeploythemtothedatacenterfacility,wedonotcontroltheoperationofthefacility.Theownerofthefacilityhasnoobligationtorenewtheagreementwithusoncom

148、merciallyreasonableterms,oratall.Ifweareunabletorenewtheagreementoncommerciallyreasonableterms,wemayberequiredtotransfertoanewfacilityorfacilities,andwemayincursignificantcostsandpossibleserviceinterruptioninconnectionwithdoingso.12Thefacilityisvulnerabletodamageorserviceinterruptionresultingfromhum

149、anerror,intentionalbadacts,earthquakes,hurricanes,floods,fires,war,terroristattacks,powerlosses,hardwarefailures,systemsfailures,telecommunicationsfailuresandsimilarevents.Moreover,whilewehaveadisasterrecoveryplaninplace,wedonotmaintaina“hotfailover”instanceofoursoftwareplatformpermittingustoimmedia

150、telyswitchoverintheeventofdamageorserviceinterruptionatourdatacenter.Theoccurrenceofanaturaldisasteroranactofterrorism,anyoutagesorvandalismorothermisconduct,oradecisiontoclosethefacilitywithoutadequatenoticeorotherunanticipatedproblemscouldresultinlengthyinterruptionsinourservices.Anychangesinservi

151、celevelsatthefacilityoranyerrors,defects,disruptionsorotherperformanceproblemsatorrelatedtothefacilitythataffectourservicescouldharmourreputationandmaydamageourcustomersbusinesses.Interruptionsinourservicesmightreduceourrevenues,subjectustopotentialliability,orresultinreducedusageofourplatform.Inadd

152、ition,someofourcustomercontractsrequireustoissuecreditsfordowntimeinexcessofcertainlevelsandinsomeinstancesgiveourcustomerstheabilitytoterminatetheirsubscriptions.Wealsodependonthird-partyInternet-hostingprovidersandcontinuousanduninterruptedaccesstotheInternetthroughthird-partybandwidthproviderstoo

153、perateourbusiness.IfwelosetheservicesofoneormoreofourInternet-hostingorbandwidthprovidersforanyreasonoriftheirservicesaredisrupted,forexampleduetovirusesor“denial-of-service”orotherattacksontheirsystems,orduetohumanerror,intentionalbadacts,powerloss,hardwarefailures,telecommunicationsfailures,fires,

154、wars,terroristattacks,floods,earthquakes,hurricanes,tornadoesorsimilarevents,wecouldexperiencedisruptioninourabilitytoofferoursolutionsorwecouldberequiredtoretaintheservicesofreplacementproviders,whichcouldincreaseouroperatingcostsandharmourbusinessandreputation.Ifwecannotefficientlyimplementoursolu

155、tionsforcustomers,wemaylosecustomers.Ourcustomershaveavarietyofdifferentdataformats,enterpriseapplicationsandinfrastructureandourplatformmustsupportourcustomersdataformatsandintegratewithcomplexenterpriseapplicationsandinfrastructures.Ifourplatformdoesnotcurrentlysupportacustomersrequireddataformato

156、rappropriatelyintegratewithacustomersapplicationsandinfrastructure,thenwemaychoosetoconfigureourplatformtodoso,whichwouldincreaseourexpenses.Additionally,wedonotcontrolourcustomersimplementationschedules.Asaresult,aswehaveexperiencedinthepast,ifourcustomersdonotallocateinternalresourcesnecessarytome

157、ettheirimplementationresponsibilitiesorifwefaceunanticipatedimplementationdifficulties,theimplementationmaybedelayed.Further,inthepast,ourimplementationcapacityhasattimesconstrainedourabilitytosuccessfullyimplementoursolutionsforourcustomersinatimelymanner,particularlyduringperiodsofhighdemand.Ifthe

158、customerimplementationprocessisnotexecutedsuccessfullyorifexecutionisdelayed,wecouldincursignificantcosts,customerscouldbecomedissatisfiedanddecidenottoincreaseusageofourplatform,nottouseourplatformbeyondaninitialperiodpriortotheirtermcommitmentandrevenuerecognitioncouldbedelayed.Inaddition,competit

159、orswithmoreefficientoperatingmodelswithlowerimplementationcostscouldpenetrateourcustomerrelationships.Additionally,largecustomersmayrequestorrequirespecificfeaturesorfunctionsuniquetotheirparticularbusinessprocesses,whichincreaseourupfrontinvestmentinsalesanddeploymenteffortsandtherevenuesresultingf

160、romthecustomersunderourtypicalcontractlengthmaynotcovertheupfrontinvestments.Ifprospectivelargecustomersrequirespecificfeaturesorfunctionsthatwedonotoffer,thenthemarketforoursolutionwillbemorelimitedandourbusinesscouldsuffer.Inaddition,supportinglargecustomerscouldrequireustodevotesignificantdevelop

161、mentservicesandsupportpersonnelandstrainourpersonnelresourcesandinfrastructure.Ifweareunabletoaddresstheneedsofthesecustomersinatimelyfashionorfurtherdevelopandenhanceoursolution,thesecustomersmaynotrenewtheirsubscriptions,seektoterminatetheirrelationshipwithus,renewonlessfavorableterms,orreducethei

162、radvertisingspendonourplatform.Ifanyoftheseweretooccur,ourrevenuesmaydeclineandouroperatingresultscouldbeadverselyaffected.Ifweareunabletomaintainorexpandoursalesandmarketingcapabilities,wemaynotbeabletogenerateanticipatedrevenues.Increasingourcustomerbaseandachievingbroadermarketacceptanceofoursoft

163、wareplatformwilldependtoasignificantextentonourabilitytoexpandoursalesandmarketingoperationsandactivities.Wearesubstantiallydependentonoursalesforcetoobtainnewcustomers.Wemayexpandoursalesteaminordertoincreaserevenuesfromnewandexistingcustomersandtofurtherpenetrateourexistingmarketsandexpandintonewm

164、arkets,butmaynotbeabletoattractandhirequalifiedsalespersonnelquicklyenoughoratall.Oursolutionsrequireasophisticatedsalesforcewithspecificsalesskillsandtechnicalknowledge.Competitionforqualifiedsalespersonnelisintense,andwemaynotbeabletoretainourexistingsalespersonnelorattract,integrateorretainsuffic

165、ienthighlyqualifiedsalespersonnel.13Ourabilitytoachieverevenuegrowthinthefuturewilldepend,inlargepart,onoursuccessinrecruiting,trainingandretainingsufficientnumbersofsalespersonnel.Thesenewemployeesrequiresignificanttrainingandexperiencebeforetheyachievefullproductivity.Asaresult,thecostofhiringandc

166、arryingnewrepresentativescannotbeoffsetbytherevenuestheyproduceforasignificantperiodoftime.Ourrecenthiresandplannedhiresmaynotbecomeproductiveasquicklyaswewouldlike,andwemaynotbeabletohireorretainsufficientnumbersofqualifiedindividualsinthemarketswherewedobusiness.Ourbusinesswillbeseriouslyharmedift

167、heseexpansioneffortsdonotworkasplannedorgenerateacorrespondingsignificantincreaseinrevenues.Anyfailuretoofferhigh-qualitytechnicalsupportservicesmayadverselyaffectourrelationshipswithourcustomersandharmourfinancialresults.Ourcustomersdependonoursupportorganizationtoresolveanytechnicalissuesrelatingt

168、ooursolutions.Inaddition,oursalesprocessishighlydependentonthequalityofoursolutions,ourbusinessreputationandonstrongrecommendationsfromourexistingcustomers.Anyfailuretomaintainhigh-qualitytechnicalsupport,oramarketperceptionthatwedonotmaintainhigh-qualitysupport,couldharmourreputation,adverselyaffec

169、tourabilitytoselloursolutionstoexistingandprospectivecustomers,andharmourbusiness,operatingresultsandfinancialcondition.Weoffertechnicalsupportserviceswithoursolutionsandmaybeunabletorespondquicklyenoughtoaccommodateshort-termincreasesincustomerdemandforsupportservices.Wealsomaybeunabletomodifythefo

170、rmatofoursupportservicestocompetewithchangesinsupportservicesprovidedbycompetitors.Itisdifficulttopredictcustomerdemandfortechnicalsupportservicesandifcustomerdemandincreasessignificantly,wemaybeunabletoprovidesatisfactorysupportservicestoourcustomers.Additionally,increasedcustomerdemandfortheseserv

171、ices,withoutcorrespondingrevenues,couldincreasecostsandadverselyaffectouroperatingresults.Ifoursecuritymeasuresarebreachedorunauthorizedaccesstocustomerdataorourdataisotherwiseobtained,oursolutionsmaybeperceivedasnotbeingsecure,customersmayreducetheuseoforstopusingoursolutionsandwemayincursignifican

172、tliabilities.Intheordinarycourseofourbusiness,wemaintainsensitivedataonournetworks,includingourintellectualpropertyandproprietaryorconfidentialbusinessinformationrelatingtoourbusinessandthatofourcustomersandbusinesspartners.Thesecuremaintenanceofthisinformationiscriticaltoourbusinessandreputation.We

173、believethatcompanieshavebeenincreasinglysubjecttoawidevarietyofsecurityincidents,cyber-attacksandotherattemptstogainunauthorizedaccess.Thesethreatscancomefromavarietyofsources,ranginginsophisticationfromanindividualhackertoastate-sponsoredattack.Cyberthreatsmaybegeneric,ortheymaybecustom-craftedagai

174、nstourinformationsystems.Overthepastyear,cyber-attackshavebecomemoreprevalentandmuchhardertodetectanddefendagainst.Ournetworkandstorageapplicationsmaybesubjecttounauthorizedaccessbyhackersorbreachedduetooperatorerror,malfeasanceorothersystemdisruptions.Itisoftendifficulttoanticipateorimmediatelydete

175、ctsuchincidentsandthedamagecausedbysuchincidents.Thesedatabreachesandanyunauthorizedaccessordisclosureofourinformationorintellectualpropertycouldresultinthelossofinformation,litigation,indemnityobligationsandotherliability.Whilewehavesecuritymeasuresinplace,oursystemsandnetworksaresubjecttoongoingth

176、reatsandthereforethesesecuritymeasuresmaybebreachedasaresultofthird-partyaction,includingcyber-attacksorotherintentionalmisconductbycomputerhackers,employeeerror,malfeasanceorotherwise.Thiscouldresultinoneormorethirdpartiesobtainingunauthorizedaccesstoourcustomersdataorourdata,includingintellectualp

177、ropertyandotherconfidentialbusinessinformation.Becausetechniquesusedtoobtainunauthorizedaccessortosabotagesystemschangefrequentlyandgenerallyarenotrecognizeduntillaunchedagainstatarget,wemaybeunabletoanticipatethesetechniquesortoimplementadequatepreventativemeasures.Thirdpartiesmayalsoattempttofraud

178、ulentlyinduceemployeesorcustomersintodisclosingsensitiveinformationsuchasusernames,passwordsorotherinformationinordertogainaccesstoourcustomersdataorourdata,includingintellectualpropertyandotherconfidentialbusinessinformation.Ifanactualorperceivedbreachofoursecurityoccurs,themarketperceptionoftheeff

179、ectivenessofoursecuritymeasurescouldbeharmed,wecouldlosepotentialsalesandexistingcustomersorwecouldincurotherliabilities,whichcouldadverselyaffectourbusiness.Wemustdevelopandintroduceenhancementsandnewfeaturesthatachievemarketacceptanceorthatkeeppacewithtechnologicaldevelopmentstoremaincompetitivein

180、ourevolvingindustry.Weoperateinadynamicmarketcharacterizedbyrapidlychangingtechnologiesandindustryandlegalstandards.Theintroductionofnewadvertisingcloudsolutionsbyourcompetitors,themarketacceptanceofsolutionsbasedonneworalternativetechnologies,ortheemergenceofnewindustrystandardscouldrenderourplatfo

181、rmobsolete.Ourabilitytocompetesuccessfully,attractnewcustomersandincreaserevenuesfromexistingcustomersdependsinlargepartonourabilitytoenhanceandimproveourexistingcross-channelperformanceadvertisingcloudplatformandtocontinuallyintroduceoracquirenewfeaturesthatareindemandbythemarketweserve.Wealsomustu

182、pdateoursoftwaretoreflectchangesinpublishersAPIsandtermsofuse.Thesuccessofanyenhancementornewsolutiondependsonseveralfactors,includingtimelycompletion,adequatequalitytesting,appropriateintroductionandmarketacceptance.Anynewplatformorfeaturethatwedeveloporacquiremaynotbeintroducedinatimelyorcost-effe

183、ctivemanner,maycontaindefectsormaynotachievethebroadmarketacceptancenecessarytogeneratesignificant14revenues.Ifweareunabletoanticipateortimelyandsuccessfullydeveloporacquirenewofferingsorfeaturesorenhanceourexistingplatformtomeetcustomerrequirements,ourbusinessandoperatingresultswillbeadverselyaffec

184、ted.Ourgrowthdependsinpartonthesuccessofourstrategicrelationshipswiththirdparties.Ourfuturegrowthwilldependonourabilitytoenterintosuccessfulstrategicrelationshipswiththirdparties.Forexample,weareseekingtoestablishrelationshipswiththirdpartiestodevelopintegrationswithcomplementarytechnologyandcontent

185、.Theserelationshipsmaynotresultinadditionalcustomersorenableustogeneratesignificantrevenues.Identifyingpartnersandnegotiatinganddocumentingrelationshipswiththemrequiresignificanttimeandresources.Ourcontractsfortheserelationshipsaretypicallynon-exclusiveanddonotprohibittheotherpartyfromworkingwithour

186、competitorsorfromofferingcompetingservices.Ifweareunsuccessfulinestablishingormaintainingourrelationshipswiththesethirdparties,ourabilitytocompeteinthemarketplaceortogrowourrevenuescouldbeimpairedandouroperatingresultswouldsuffer.Asaresultofourcustomersincreasedusageofoursoftwareplatform,wewillneedt

187、ocontinuallyimproveourhostinginfrastructuretoavoidserviceinterruptionsorslowersystemperformance.Wehaveexperiencedcontinuedgrowthinthenumberofadvertisers,transactionsanddatathatourhostinginfrastructuresupports.Weseektomaintainsufficientexcesscapacityinourinfrastructuretomeettheneedsofallofourcustomer

188、s.Wealsoseektomaintainexcesscapacitytofacilitatetherapidprovisionofnewcustomerdeploymentsandtheexpansionofexistingcustomerdeployments.Forexample,ifwesecurealargecustomeroragroupofcustomersthatrequiresignificantamountsofbandwidthorstorage,wemayneedtoincreasebandwidth,storage,powerorotherelementsofour

189、applicationarchitectureandourinfrastructure,andourexistingsystemsmaynotbeabletoscaleinamannersatisfactorytoourexistingorprospectivecustomers.Theamountofinfrastructureneededtosupportourcustomersisbasedonourestimatesofanticipatedusage.Ifweweretoexperienceunforeseenincreasesinusage,wecouldberequiredtoi

190、ncreaseourinfrastructureinvestmentsresultinginincreasedcostsorreducedgrossmargins,andifwedonotaccuratelypredictourinfrastructurecapacityrequirements,ourcustomerscouldexperienceserviceoutagesthatmaysubjectustofinancialpenaltiesandliabilitiesandresultincustomerlosses.Ifourhostinginfrastructurecapacity

191、failstokeeppacewithincreasedsales,customersmayexperienceserviceinterruptionsorslowersystemperformanceasweseektoobtainadditionalcapacity,whichcouldharmourreputationandadverselyaffectourrevenuegrowth.Asuseofoursoftwareplatformgrowsandascustomersuseitformorecomplicatedtasks,wewillneedtodevoteadditional

192、resourcestoimprovingourapplicationarchitectureandourinfrastructureinordertomaintaintheperformanceofoursoftwareplatform.Wemayneedtoincuradditionalcoststoupgradeorexpandourcomputersystemsandarchitectureinordertoaccommodateincreaseddemandifoursystemscannothandlecurrentorhighervolumesofusage.Inaddition,

193、increasingoursystemsandinfrastructureinadvanceofnewcustomerswouldcauseustohaveincreasedcostofrevenues,whichcanadverselyaffectourgrossmarginsuntilweincreaserevenuesthatarespreadovertheincreasedcosts.Anyfailuretoprotectourintellectualpropertyrightscouldimpairourabilitytoprotectourproprietarytechnology

194、andourbrand.Oursuccessandabilitytocompetedependsinpartuponourintellectualproperty.Weprimarilyrelyonacombinationofcopyright,tradesecretandtrademarklaws,aswellasconfidentialityproceduresandcontractualrestrictionswithouremployees,customers,partnersandotherstoestablishandprotectourintellectualpropertyri

195、ghts.However,thestepswetaketoprotectourintellectualpropertyrightsmaybeinadequateorwemaybeunabletosecureintellectualpropertyprotectionforallofoursolutions.Inparticular,wehavetwoissuedUnitedStatespatents.Ifweareunabletoprotectourintellectualproperty,ourcompetitorscoulduseourintellectualpropertytomarke

196、tproductsandservicessimilartooursandourabilitytocompeteeffectivelywouldbeimpaired.Moreover,othersmayindependentlydeveloptechnologiesthatarecompetitivetooursorinfringeourintellectualproperty.Theenforcementofourintellectualpropertyrightsdependsonourlegalactionsagainsttheseinfringersbeingsuccessful,but

197、wecannotbesuretheseactionswillbesuccessful,evenwhenourrightshavebeeninfringed.Inaddition,defendingourintellectualpropertyrightsmightentailsignificantexpenseanddiversionofmanagementresources.Anyofourintellectualpropertyrightsmaybechallengedbyothersorinvalidatedthroughadministrativeprocessesorlitigati

198、on.Anypatentsissuedinthefuturemaynotprovideuswithcompetitiveadvantagesormaybesuccessfullychallengedbythirdparties.Furthermore,legalstandardsrelatingtothevalidity,enforceabilityandscopeofprotectionofintellectualpropertyrightsareuncertain.Effectiveprotectionofourintellectualpropertymaynotbeavailableto

199、usineverycountryinwhichoursolutionsareavailable.ThelawsofsomeforeigncountriesmaynotbeasprotectiveofintellectualpropertyrightsasthoseintheUnitedStates,andmechanismsforenforcementofintellectualpropertyrightsmaybeinadequate.Accordingly,despiteourefforts,wemaybeunabletopreventthirdpartiesfrominfringingu

200、ponormisappropriatingourintellectualproperty.15Wemightberequiredtospendsignificantresourcestomonitorandprotectourintellectualpropertyrights,andoureffortstoenforceourintellectualpropertyrightsmaybemetwithdefenses,counterclaimsandcountersuitsattackingthevalidityandenforceabilityofourintellectualproper

201、tyrights.Litigationtoprotectandenforceourintellectualpropertyrightscouldbecostly,time-consuminganddistractingtomanagement,whetherornotitisresolvedinourfavor,andcouldultimatelyresultintheimpairmentorlossofportionsofourintellectualproperty.Wecouldincursubstantialcostsasaresultofanyclaimofinfringemento

202、fanotherpartysintellectualpropertyrights.Inrecentyears,therehasbeensignificantlitigationintheUnitedStatesinvolvingpatentsandotherintellectualpropertyrights.CompaniesintheInternetandtechnologyindustriesareincreasinglybringingandbecomingsubjecttosuitsalleginginfringementofproprietaryrights,particularl

203、ypatentrights,andourcompetitorsmayholdpatentsorhavependingpatentapplications,whichcouldberelatedtoourbusiness.Theseriskshavebeenamplifiedbytheincreaseinthirdparties,whichwerefertoasnon-practicingentities,whosesoleprimarybusinessistoassertsuchclaims.Wehavereceivedinthepast,andexpecttoreceiveinthefutu

204、re,noticesthatclaimweorourcustomersusingoursolutionshavemisappropriatedormisusedotherpartiesintellectualpropertyrights.Ifwearesuedbyathirdpartythatclaimsthatourtechnologyinfringesitsrights,thelitigationcouldbeexpensiveandcoulddivertourmanagementresources.Wedonotcurrentlyhaveanextensivepatentportfoli

205、oofourown,whichmaylimitthedefensesavailabletousinanysuchlitigation.Inaddition,inmostinstances,wehaveagreedtoindemnifyourcustomersagainstcertainclaimsthatoursubscriptionservicesinfringetheintellectualpropertyrightsofthirdparties.Ourbusinesscouldbeadverselyaffectedbyanysignificantdisputesbetweenusando

206、urcustomersastotheapplicabilityorscopeofourindemnificationobligationstothem.Theresultsofanyintellectualpropertylitigationtowhichwemightbecomeaparty,orforwhichwearerequiredtoprovideindemnification,mayrequireustodooneormoreofthefollowing:ceaseofferingorusingtechnologiesthatincorporatethechallengedinte

207、llectualproperty;makesubstantialpaymentsforlegalfees,settlementpaymentsorothercostsordamages;obtainalicense,whichmaynotbeavailableonreasonableterms,tosellorusetherelevanttechnology;orredesigntechnologytoavoidinfringement.Ifwearerequiredtomakesubstantialpaymentsorundertakeanyoftheotheractionsnotedabo

208、veasaresultofanyintellectualpropertyinfringementclaimsagainstusoranyobligationtoindemnifyourcustomersforsuchclaims,suchpaymentsorcostscouldhaveamaterialadverseeffectuponourbusinessandfinancialresults.Ouruseofopensourcetechnologycouldimposelimitationsonourabilitytocommercializeoursoftwareplatform.Weu

209、seopensourcesoftwareinourplatform.Someopensourcesoftwarelicensesrequireuserswhodistributeopensourcesoftwareaspartoftheirsoftwaretopubliclydiscloseallorpartofthesourcecodetosuchsoftwareand/ormakeavailableanyderivativeworksoftheopensourcecodeonunfavorabletermsoratnocost.Thetermsofvariousopensourcelice

210、nseshavenotbeeninterpretedbytheUnitedStatescourts,andthereisariskthatsuchlicensescouldbeconstruedinamannerthatimposesunanticipatedconditionsorrestrictionsonourabilitytomarketoursoftwareplatform.Whilewemonitorouruseofopensourcesoftwareandtrytoensurethatnoneisusedinamannerthatwouldrequireustodiscloseo

211、ursourcecodeorthatwouldotherwisebreachthetermsofanopensourceagreement,suchusecouldinadvertentlyoccurandwemayberequiredtoreleaseourproprietarysourcecode,paydamagesforbreachofcontract,re-engineerourapplications,discontinuesalesintheeventre-engineeringcannotbeaccomplishedonatimelybasisortakeotherremedi

212、alactionthatmaydivertresourcesawayfromourdevelopmentefforts,anyofwhichcouldcauseustobreachcustomercontracts,harmourreputation,resultincustomerlossesorclaims,increaseourcostsorotherwiseadverselyaffectourbusinessandoperatingresults.16Becauseourlong-termsuccessdepends,inpart,onourabilitytoexpandoursale

213、stocustomersoutsidetheUnitedStates,ourbusinesswillbesusceptibletorisksassociatedwithinternationaloperations.Wecurrentlymaintainofficesand/orhavepersonnelinAustralia,China,England,France,Germany,IrelandandJapan,aswellastheUnitedStates.AswecontinuetoexpandourcustomerbaseoutsidetheUnitedStates,ourbusin

214、esswillbeincreasinglysusceptibletorisksassociatedwithinternationaloperations.However,wehavealimitedoperatinghistoryoutsidetheUnitedStates,andourabilitytomanageourbusinessandconductouroperationsinternationallyrequiresconsiderablemanagementattentionandresourcesandissubjecttoparticularchallengesofsuppo

215、rtingarapidlygrowingbusinessinanenvironmentofdiversecultures,languages,customs,taxlaws,legalsystems,alternatedisputesystemsandregulatorysystems.Therisksandchallengesassociatedwithinternationalexpansioninclude:theneedtosupportandintegratewithlocalpublishersandpartners;continuedlocalizationofourplatfo

216、rm,includingtranslationintoforeignlanguagesandassociatedexpenses;competitionwithcompaniesthathavegreaterexperienceinthelocalmarketsthanwedoorwhohavepre-existingrelationshipswithpotentialcustomersinthosemarkets;compliancewithmultiple,potentiallyconflictingandchanginggovernmentallawsandregulations,inc

217、ludingemployment,tax,privacyanddataprotectionlawsandregulations;compliancewithanti-briberylaws,includingcompliancewiththeForeignCorruptPracticesAct;difficultiesininvoicingandcollectinginforeigncurrenciesandassociatedforeigncurrencyexposure;difficultiesinstaffingandmanagingforeignoperationsandtheincr

218、easedtravel,infrastructureandlegalcompliancecostsassociatedwithinternationaloperations;differentorlesserprotectionofourintellectualpropertyrights;difficultiesinenforcingcontractsandcollectingaccountsreceivable,longerpaymentcyclesandothercollectiondifficulties;restrictionsonrepatriationofearnings;and

219、regionaleconomicandpoliticalconditions.Wehavelimitedexperienceinmarketing,sellingandsupportingoursubscriptionservicesinternationally,whichincreasestheriskthatanypotentialfutureexpansioneffortsthatwemayundertakewillnotbesuccessful.Fluctuationsintheexchangerateofforeigncurrenciescouldresultincurrencyt

220、ransactionslosses.WecurrentlyhaveforeignsalesdenominatedinAustralianDollars,BritishPoundSterling,CanadianDollars,ChineseYuan,Euros,JapaneseYenandSingaporeDollars.Inaddition,weincuraportionofouroperatingexpensesinthecurrenciesofthecountrieswherewehaveoffices.Wefaceexposuretoadversemovementsincurrency

221、exchangerates,whichmaycauseourrevenuesandoperatingresultstodiffermateriallyfromexpectations.IftheU.S.Dollarstrengthensrelativetoforeigncurrenciesasithasduring2015,ournon-U.S.revenueswouldbeadverselyaffected.Conversely,adeclineintheU.S.Dollarrelativetoforeigncurrencieswouldincreaseournon-U.S.revenues

222、whentranslatedintoU.S.Dollars.Ouroperatingresultscouldbenegativelyimpacteddependingontheamountofexpensedenominatedinforeigncurrencies.Asexchangeratesvary,revenues,costofrevenues,operatingexpensesandotheroperatingresults,whentranslated,maydiffermateriallyfromexpectations.Inaddition,ourrevenuesandoper

223、atingresultsaresubjecttofluctuationifourmixofUnitedStatesandforeigncurrencydenominatedtransactionsorexpenseschangesinthefuturebecausewedonotcurrentlyhedgeourforeigncurrencyexposure.Evenifweweretoimplementhedgingstrategiestomitigateforeigncurrencyrisk,thesestrategiesmightnoteliminateourexposuretofore

224、ignexchangeratefluctuationsandwouldinvolvecostsandrisksoftheirown,suchasongoingmanagementtimeandexpertise,externalcoststoimplementthestrategiesandpotentialaccountingimplications.Ifwefailtodevelopwidespreadbrandawarenesscost-effectively,ourbusinessmaysuffer.Webelievethatdevelopingandmaintainingwidesp

225、readawarenessofourbrandinacost-effectivemanneriscriticaltoachievingwidespreadacceptanceofoursolutionandattractingnewcustomers.Weexpectsalesandmarketingexpensestoincreaseasaresultofourmarketingandbrandpromotionactivities.Wemaynotgeneratecustomerawarenessorincreaserevenuesenoughtooffsettheincreasedexp

226、ensesweincurinbuildingourbrand.Ifwefailtosuccessfullypromoteandmaintainourbrand,orincursubstantialmarketingandsalesexpenses,whicharenotoffsetbyincreasedrevenues,wemayfailtoattractorretaincustomersnecessarytorealizeasufficientreturnonourbrand-buildingefforts,ortoachievethewidespreadbrandawarenessthat

227、isessentialforbroadcustomeradoptionofoursolution.17Unfavorableconditionsinthemarketfordigitaladvertisingortheglobaleconomyorreductionsindigitaladvertisingspendcouldlimitourabilitytogrowourbusinessandnegativelyaffectouroperatingresults.Revenuegrowthandpotentialprofitabilityofourbusinessdependsondigit

228、aladvertisingspendbyadvertisersinthemarketsweserve.Ouroperatingresultsmayvarybasedonchangesinthemarketfordigitaladvertisingortheglobaleconomy.Totheextentthatweakeconomicconditionscauseourcustomersandpotentialcustomerstofreezeorreducetheiradvertisingbudgets,particularlydigitaladvertising,demandforour

229、solutionmaybenegativelyaffected.Historically,economicdownturnshaveresultedinoverallreductionsinadvertisingspend.Ifeconomicconditionsdeteriorateortheriseofgeopoliticalinstabilityandmilitaryhostilitiescauseseconomicuncertainty,ourcustomersandpotentialcustomersmayelecttodecreasetheiradvertisingbudgetso

230、rdeferorreconsidersoftwareandservicepurchases,whichwouldlimitourabilitytogrowourbusinessandnegativelyaffectouroperatingresults.Ourbusinessdependsonretainingandattractingqualifiedpersonnel,andturnovermayresultinoperationalinefficienciesthatcouldnegativelyaffectourbusiness.Oursuccessdependsuponthecont

231、inuedserviceofourtalentedmanagement,operationalandkeytechnicalemployees,aswellasourabilitytocontinuetoattractadditionalhighlyqualifiedtalent.Turnoveramongstouremployeescouldresultinoperationalandadministrativeinefficienciesandaddedcosts,whichcouldadverselyimpactourresultsofoperations,stockpriceandcu

232、stomerrelationships.Inaddition,wemustsuccessfullyintegrateanynewpersonnelthatwehirewithinourorganizationinordertoachieveouroperatingobjectives,andchangesinotherkeypositionsmaytemporarilyaffectourfinancialperformanceandresultsofoperationsasnewemployeesbecomefamiliarwithourbusiness.Further,ourmanageme

233、ntteamhasonlyworkedtogetherforashortperiodoftime,includingourthreeexecutiveofficerswhoeachjoinedwithinthelasttwoyears,andanylossofanyothermemberofourmanagementteamcouldadverselyaffectourbusiness.Wedonotmaintainkeypersonlifeinsurancepoliciesonanyofouremployees.Eachofourexecutiveofficers,keytechnicalp

234、ersonnelandotheremployeescouldterminatehisorherrelationshipwithusatanytime.Ourbusinessalsorequiresskilledtechnical,salesandotherpersonnel,whoareinhighdemandandareoftensubjecttocompetingoffers.Asweexpandintoadditionalgeographicmarkets,wewillrequirepersonnelwithexpertiseinthesenewareas.Competitionforq

235、ualifiedemployeesisintenseinourindustryandparticularlyinSanFrancisco,California,wheremostofouremployeesarebased.Aninabilitytoretain,attract,relocateandmotivateemployeesrequiredforourbusiness,includingtheplannedexpansionofourbusiness,coulddelayorpreventtheachievementofourbusinessobjectivesandcouldmat

236、eriallyharmourbusinessandourcustomerrelationships.Ourbusinessandoperationshaveexperiencedrapidgrowthinrecentperiods,whichhasplaced,andmaycontinuetoplace,significantdemandsonourmanagementandinfrastructure.Ifwefailtomanageourgrowtheffectively,wemaybeunabletoexecuteourbusinessplan,maintainhighlevelsofs

237、erviceoraddresscompetitivechallengesadequately.Weincreasedournumberoffull-timeemployeesfrom285asofDecember31,2011to511asofDecember31,2015.Ourgrowthhasplaced,andmaycontinuetoplace,asignificantstrainonourmanagerial,administrative,operational,financialandotherresources.Creatingaglobalorganizationandman

238、agingageographicallydispersedworkforcewillrequiresubstantialmanagementeffort,theallocationofvaluablemanagementresourcesandsignificantadditionalinvestmentinourinfrastructure.Wewillberequiredtocontinuetoimproveouroperational,financialandmanagementcontrolsandourreportingproceduresandwemaynotbeabletodos

239、oeffectively.Moreover,wemayfromtimetotimedecidetoundertakecostsavingsinitiatives,suchasadditionalrestructurings,disposingof,and/orotherwisediscontinuingcertainproducts,inanefforttofocusourresourcesonkeystrategicinitiativesandstreamlineourbusiness.Further,toaccommodateourexpectedgrowthwemustcontinual

240、lyimproveandmaintainourtechnology,systemsandnetworkinfrastructure.Assuch,wemaybeunabletomanageourexpenseseffectivelyinthefuture,whichmaynegativelyimpactourgrossmarginsoroperatingexpensesinanyparticularquarter.Ifwefailtomanageouranticipatedgrowthorchangeinamannerthatdoesnotpreservethekeyaspectsofourc

241、orporateculture,thequalityofoursolutionsmaysuffer,whichcouldnegativelyaffectourbrandandreputationandharmourabilitytoretainandattractcustomers.Domesticandforeigngovernmentregulationandenforcementofdatapracticesanddatatrackingtechnologiesisexpansive,notclearlydefinedandrapidlyevolving.Suchregulationco

242、ulddirectlyrestrictportionsofourbusinessorindirectlyaffectourbusinessbyconstrainingourcustomersuseofourplatformorlimitingthegrowthofourmarkets.Federal,state,municipaland/orforeigngovernmentsandagencieshaveadoptedandcouldinthefutureadopt,modify,applyorenforcelaws,policies,andregulationscoveringuserpr

243、ivacy,datasecurity,technologiessuchascookiesthatareusedtocollect,storeand/orprocessdata,thetaxationofproductsandservices,unfairanddeceptivepractices,and/orthecollection,use,processing,transfer,storageand/ordisclosureofdataassociatedwithauniqueindividual.Thecategoriesofdataregulatedundertheselawsvary

244、widelyandareoftenill-definedandsubjecttonewapplicationsorinterpretationbyregulators.Oursubscriptionservicesenableourcustomerstoservedigitaladstotargetedpopulationsegments,aswellascollect,manageandstoredataregardingthemeasurement18andvaluationoftheirdigitaladvertisingandmarketingcampaigns,whichmayinc

245、ludedatathatisdirectlyorindirectlyobtainedorderivedthroughtheactivitiesofonlineormobilevisitors.Theuncertaintyandinconsistencyamongtheselaws,coupledwithalackofguidanceastohowtheselawswillbeappliedtocurrentandemergingInternetandmobileanalyticstechnologies,createsariskthatregulators,lawmakersorotherth

246、irdparties,suchaspotentialplaintiffs,mayassertclaims,pursueinvestigationsoraudits,orengageincivilorcriminalenforcement.Theseactionscouldlimitthemarketforoursubscriptionservicesorimposeburdensomerequirementsonourservicesand/orcustomersuseofourservices,therebyrenderingourbusinessunprofitable.Somefeatu

247、resofoursubscriptionservicesusecookies,whichtriggerthedataprotectionrequirementsofcertainforeignjurisdictions,suchastheEUCookieDirectiveandtheEUDataPrivacyDirective.Inaddition,ourservicescollectdataaboutvisitorsinteractionswithouradvertiserclientsthatmaybesubjecttoregulationundercurrentorfuturelawso

248、rregulations.Ifourprivacyordatasecuritymeasuresfailtocomplywiththesecurrentorfuturelawsandregulationsinanyofthejurisdictionsinwhichwecollectinformation,wemaybesubjecttolitigation,regulatoryinvestigations,civilorcriminalenforcement,auditsorotherliabilitiesinsuchjurisdictions,orouradvertisersmaytermin

249、atetheirrelationshipswithus.Inaddition,foreigncourtjudgmentsorregulatoryactionscouldimpactourabilitytotransfer,processand/orreceivetransnationaldatathatiscriticaltoouroperations,includingdatarelatingtousers,clients,orpartnersoutsidetheUnitedStates.Suchjudgmentsoractionscouldaffectthemannerinwhichwep

250、rovideourservicesoradverselyaffectourfinancialresultsifforeignclientsandpartnersarenotabletolawfullytransferdatatous.Thisareaofthelawiscurrentlyunderintensegovernmentscrutinyandmanygovernments,includingtheUnitedStatesgovernment,areconsideringavarietyofproposedregulationsthatwouldrestrictorimpactthec

251、onditionsunderwhichdataobtainedfromorthroughtheactivitiesofvisitorscouldbecollected,processedorstored.Inaddition,regulatorssuchastheFederalTradeCommissionandtheCaliforniaAttorneyGeneralarecontinuallyproposingnewregulationsandinterpretingandapplyingexistingregulationsinnewways.Changestoexistinglawsor

252、newlawsregulatingthesolicitation,collectionorprocessingofpersonalandconsumerinformation,truth-in-advertisingandconsumerprotectioncouldaffectourcustomersutilizationofdigitaladvertisingandmarketing,potentiallyreducingdemandforoursubscriptionservices,orimposerestrictionsthatmakeitmoredifficultorexpensi

253、veforustoprovideourservices.IflegislationdampensthegrowthinwebandmobileusageoraccesstotheInternet,ourresultsofoperationscouldbeharmed.Legislationenactedinthefuturecoulddampenthegrowthinwebandmobileusageanddecreaseitsacceptanceasamediumofcommunicationsandcommerceorresultinincreasedadoptionofnewmodeso

254、fcommunicationandcommercethatmaynotbeservicedbyourproducts.Inaddition,governmentagenciesorprivateorganizationsmaybegintoimposetaxes,feesorotherchargesforaccessingtheInternet,whichcouldresultinslowergrowthoradecreaseinecommerce,useofsocialmediaand/oruseofmobiledevices.Anyoftheseoutcomescouldcausedema

255、ndforourplatformtodecrease,ourcoststoincrease,andourresultsofoperationsandfinancialconditiontobeharmed.Ifourcustomersfailtoabidebyapplicableprivacylawsortoprovideadequatenoticeand/orobtainconsentfromendusers,wecouldbesubjecttolitigationorenforcementactionorreduceddemandforourservices.Industryself-re

256、gulatorystandardsmaybeimplementedinthefuturethatcouldaffectdemandforourplatformandourabilitytoaccessdataweusetoprovideourplatform.Ourcustomersutilizeourservicestosupportandmeasuretheirdirectinteractionswithvisitors,andalthoughweprovidenoticeandchoicemechanismsonourwebsitesforoursubscriptionservices,

257、wealsomustrelyonourcustomerstoimplementandadministernoticeandchoicemechanismsrequiredunderapplicablelaws.Ifweorourcustomersfailtoabidebytheselaws,itcouldresultinlitigationorregulatoryorenforcementactionagainstourcustomersoragainstusdirectly.Inaddition,self-regulatoryorganizations(suchastheDigitalAdv

258、ertisingNetworkorNetworkAdvertisingInitiative)towhichourcustomers,partnersandsuppliersmaybelong,mayimposeopt-inoropt-outrequirementsonourcustomers,whichmayinthefuturerequireourcustomerstoprovidevariousmechanismsforuserstoopt-inoropt-outofthecollectionofanydata,includinganonymousdata,withrespecttosuc

259、huserswebormobileactivities.Theonlineand/ormobileindustriesmayadopttechnicalorindustrystandards,orfederal,state,localorforeignlawsmaybeenactedthatallowuserstoopt-inoropt-outofdatathatisnecessarytoourbusiness.Inparticular,somegovernmentregulatorsandstandard-settingorganizationshavesuggesteda“DoNotTra

260、ck”standardthatallowsuserstoexpressapreference,independentofcookiesettingsintheirbrowser,nottohavewebsitebrowsingrecorded.Allthemajorinternetbrowsershaveimplementedsomeversionofa“DoNotTrack”setting.Furthermore,publishersmayimplementalternativetrackingtechnologiesthatmakeitmoredifficulttoaccessthedat

261、anecessarytoourbusinessormakeitmoredifficultforustocompetewiththepublishersownadvertisingmanagementsolutions.Ifanyoftheseeventsweretooccurinthefuture,itcouldhaveamaterialeffectonourabilitytoprovideservicesandforourcustomerstocollectthedatathatisnecessarytouseourservices.19Ourrevenuesmaybeadverselyaf

262、fectedifwearerequiredtochargesalestaxesinadditionaljurisdictionsorothertaxesforoursolutions.Wecollectorhaveimposeduponussalesorothertaxesrelatedtothesolutionswesellincertainstatesandotherjurisdictions.Additionalstates,countriesorotherjurisdictionsmayseektoimposesalesorothertaxcollectionobligationson

263、usinthefuture,orstatesorjurisdictionsinwhichwealreadypaytaxmayincreasetheamountoftaxeswearerequiredtopay.Asuccessfulassertionbyanystate,countryorotherjurisdictioninwhichwedobusinessthatweshouldbecollectingsalesorothertaxesonthesaleofourproductsandservicescould,amongotherthings,createsignificantadmin

264、istrativeburdensforus,resultinsubstantialtaxliabilitiesforpastsales,discourageclientsfrompurchasingsolutionsfromusorotherwisesubstantiallyharmourbusinessandresultsofoperations.Wemayexperiencequarterlyfluctuationsinouroperatingresultsduetoanumberoffactorswhichmakeourfutureresultsdifficulttopredictand

265、couldcauseouroperatingresultstofallbelowexpectationsorourguidance.Ourquarterlyoperatingresultsmayfluctuateduetoavarietyoffactors,manyofwhichareoutsideofourcontrol.Asaresult,comparingouroperatingresultsonaperiod-to-periodbasismaynotbemeaningful.Youshouldnotrelyonourpastresultsasindicativeofourfuturep

266、erformance.Ifourrevenuesoroperatingresultsfallbelowtheexpectationsofinvestorsorsecuritiesanalysts,orbelowanyguidancewemayprovidetothemarket,thepriceofourcommonstockcoulddeclinesubstantially.Inadditiontootherriskfactorslistedinthissection,factorsthatmayaffectourquarterlyoperatingresultsincludethefoll

267、owing:thelevelofadvertisingspendmanagedthroughourplatformforaparticularquarter;customerrenewalrates,andthepricingandusageofourplatforminanyrenewalterm;demandforourplatformandthesizeandtimingofoursales;customersdelayingpurchasingdecisionsinanticipationofnewreleasesbyusorofnewproductsbyourcompetitors;

268、networkoutages,platformdowntime,softwarebugsorsecuritybreachesandanyassociatedcredits,warrantyclaimsorotherexpenses;changesinthecompetitivedynamicsofourindustry,includingconsolidationamongcompetitorsorcustomers;marketacceptanceofourcurrentandfuturesolutions;changesinspendingondigitaladvertisingorinf

269、ormationtechnologyandsoftwarebyourcurrentand/orprospectivecustomers;budgetingcyclesofourcustomers;ourpotentiallylengthysalescycle;ourabilitytocontrolcosts,includingouroperatingexpenses;theamountandtimingofinfrastructurecostsandoperatingexpensesrelatedtothemaintenanceandexpansionofourbusiness,operati

270、onsandinfrastructure;restructuringofourbusinessandhiringorseparationofemployees;foreigncurrencyexchangeratefluctuations;andgeneraleconomicandpoliticalconditionsinourdomesticandinternationalmarkets.Baseduponallofthefactorsdescribedabove,wehavealimitedabilitytoforecastourfuturerevenues,costsandexpense

271、s,andasaresult,ouroperatingresultsmayfromtimetotimefallbelowourestimatesortheexpectationsofpublicmarketanalystsandinvestors.Wemightrequireadditionalcapitaltosupportbusinessgrowth,andthiscapitalmightnotbeavailableonacceptableterms,ifatall.Weintendtocontinuetomakeinvestmentstosupportourbusinessgrowtha

272、ndmayrequireadditionalfundstorespondtobusinesschallenges,includingtheneedtodevelopnewfeaturesorenhanceourexistingplatform,improveouroperatinginfrastructureoracquirecomplementarybusinessesandtechnologies.Accordingly,wemayneedtoengageinequityordebtfinancingstosecureadditionalfunds.Ifweraiseadditionalf

273、undsthroughfurtherissuancesofequityorconvertibledebtsecurities,ourexistingstockholderscouldsuffersignificantdilution,andanynewequitysecuritiesweissuecouldhaverights,preferencesandprivilegessuperiortothoseofholdersofourcommonstock.Anydebtfinancingsecuredbyusinthefuturecouldinvolverestrictivecovenants

274、relatingtoourcapitalraisingactivitiesandotherfinancialandoperationalmatters,whichmaymakeitmoredifficultforustoobtain20additionalcapitalandtopursuebusinessopportunities,includingpotentialacquisitions.Inaddition,wemaynotbeabletoobtainadditionalfinancingontermsfavorabletous,ifatall.Ifweareunabletoobtai

275、nadequatefinancingorfinancingontermssatisfactorytous,whenwerequireit,ourabilitytocontinuetosupportourbusinessgrowthandtorespondtobusinesschallengescouldbesignificantlyimpaired.Futureacquisitions,strategicinvestments,partnershipsoralliancescouldbedifficulttointegrate,diverttheattentionofkeymanagement

276、personnel,disruptourbusiness,diluteshareholdervalueandadverselyaffectourresultsofoperationsandfinancialcondition.WeacquiredSocialMoovS.A.S.(“SocialMoov”)inFebruary2015,andNowSpots,Inc.,doingbusinessasPerfectAudience(“PerfectAudience”)inJune2014andmayseektoacquireadditionalbusinesses,productsortechno

277、logiesinthefuture.However,thesearetheonlytwoacquisitionsinthehistoryofourcompanyandwehavelimitedexperienceinacquiringandintegratingbusinesses,productsandtechnologies.Ifweidentifyanappropriateacquisitioncandidate,wemaynotbesuccessfulinnegotiatingthetermsand/orfinancingoftheacquisition,andourduedilige

278、ncemayfailtoidentifyalloftheproblems,liabilitiesorothershortcomingsorchallengesofanacquiredbusiness,productortechnology,includingissuesrelatedtointellectualproperty,productqualityorarchitecture,regulatorycompliancepractices,revenuerecognitionorotheraccountingpracticesoremployeeorclientissues.Anyacqu

279、isitionorinvestmentmayrequireustousesignificantamountsofcash,issuepotentiallydilutiveequitysecuritiesorincurdebt.Inaddition,acquisitions,includingouracquisitionsofSocialMoovandPerfectAudience,involvenumerousrisks,anyofwhichcouldharmourbusiness,including:regulatoryandcommercialrisksrelatingtoretarget

280、ingofonlineadvertisingandsocialadvertising,theprimarybusinessesofPerfectAudienceandSocialMoov,respectively;difficultiesinintegratingtheoperations,technologies,servicesandpersonnelofacquiredbusinesses,especiallyifthosebusinessesoperateoutsideofourcorecompetencyand/orinforeigncountries;culturalchallen

281、gesassociatedwithintegratingemployeesfromtheacquiredcompanyintoourorganization;reputationandperceptionrisksassociatedwiththeacquiredproductortechnologybythegeneralpublic;ineffectivenessorincompatibilityofacquiredtechnologiesorservices;potentiallossofkeyemployeesofacquiredbusinesses;inabilitytomainta

282、inthekeybusinessrelationshipsandthereputationsofacquiredbusinesses;diversionofmanagementsattentionfromotherbusinessconcerns;litigationforactivitiesoftheacquiredcompany,includingclaimsfromterminatedemployees,clients,formershareholdersorotherthirdparties;failuretoidentifyalloftheproblems,liabilitiesor

283、othershortcomingsorchallengesofanacquiredcompany,technology,orsolution,includingissuesrelatedtointellectualproperty,solutionqualityorarchitecture,regulatorycompliancepractices,revenuerecognitionorotheraccountingpracticesoremployeeorclientissues;inthecaseofforeignacquisitionssuchasSocialMoov,theneedt

284、ointegrateoperationsacrossdifferentculturesandlanguagesandtoaddresstheparticulareconomic,currency,politicalandregulatoryrisksassociatedwithspecificcountries;costsnecessarytoestablishandmaintaineffectiveinternalcontrolsforacquiredbusinesses;failuretosuccessfullyfurtherdeveloptheacquiredtechnologyinor

285、dertorecoupourinvestment;andincreasedfixedcosts.IfweareunabletosuccessfullyintegrateSocialMoovorPerfectAudience,oranyfuturebusiness,productortechnologyweacquire,ourbusinessandresultsofoperationsmaysuffer.Inaddition,asignificantportionofthepurchasepriceofcompaniesweacquiremaybeallocatedtoacquiredgood

286、willandotherintangibleassets,whichmustbeassessedforimpairmentatleastannually.Ifouracquisitionsdonotyieldexpectedreturns,wemayberequiredtotakechargestoouroperatingresultsbasedonthisimpairmentassessmentprocess,whichcouldadverselyaffectourresultsofoperations.21Acquisitionscouldalsoresultindilutiveissua

287、ncesofequitysecuritiesortheincurrenceofdebt,whichcouldadverselyaffectouroperatingresults.Forinstance,inconnectionwithouracquisitionofPerfectAudience,weissued1.7millionsharesofourcommonstock,andinconnectionwithouracquisitionofSocialMoov,weissuedacombinedtotalof1.1millionsharesinFebruary2015andFebruar

288、y2016,andareobligatedtoissueuptoanadditional0.5millionsharesofourcommonstock,subjecttocertaincontingenciesinFebruary2017.Ifweareunabletoimplementandmaintaineffectiveinternalcontroloverfinancialreportinginthefuture,investorsmayloseconfidenceintheaccuracyandcompletenessofourfinancialreportsandthemarke

289、tpriceofourcommonstockmaybenegativelyaffected.Asapubliccompany,wearerequiredtomaintaininternalcontroloverfinancialreportingandtoreportanymaterialweaknessesinsuchinternalcontrol.Section404oftheSarbanes-OxleyActof2002(the“Sarbanes-OxleyAct”)requiresthatweevaluateanddeterminetheeffectivenessofourintern

290、alcontroloverfinancialreportingandprovideamanagementreportontheinternalcontroloverfinancialreportingandareportbyourindependentregisteredpublicaccountingfirmtotheextentwedecidenottoavailourselvesoftheexemptionprovidedtoanemerginggrowthcompany,asdefinedbyTheJumpstartOurBusinessActof2012.Ifwehaveamater

291、ialweaknessinourinternalcontroloverfinancialreporting,wemaynotdetecterrorsonatimelybasisandourfinancialstatementsmaybemateriallymisstated.Inaddition,inthefutureifweidentifymaterialweaknessesinourinternalcontroloverfinancialreporting,ifweareunabletocomplywiththerequirementsofSection404inatimelymanner

292、,ifweareunabletoassertthatourinternalcontroloverfinancialreportingiseffectiveorifourindependentregisteredpublicaccountingfirmisunabletoexpressanopinionastotheeffectivenessofourinternalcontroloverfinancialreporting,investorsmayloseconfidenceintheaccuracyandcompletenessofourfinancialreportsandthemarke

293、tpriceofourcommonstockcouldbenegativelyaffected,andwecouldbecomesubjecttoinvestigationsbythestockexchangeonwhichoursecuritiesarelisted,theSEC,orotherregulatoryauthorities,whichcouldrequireadditionalfinancialandmanagementresources.Weareanemerginggrowthcompany,andwecannotbecertainifthereduceddisclosur

294、erequirementsapplicabletoemerginggrowthcompanieswillmakeourcommonstocklessattractivetoinvestors.Foraslongaswecontinuetobeanemerginggrowthcompany,weintendtotakeadvantageofcertainexemptionsfromvariousreportingrequirementsthatareapplicabletootherpubliccompaniesincluding,butnotlimitedto,theexemptionfrom

295、therequirementofareportonourinternalcontroloverfinancialreportingbyourindependentregisteredpublicaccountingfirm,reduceddisclosureobligationsregardingexecutivecompensationinourperiodicreportsandproxystatements,andexemptionsfromtherequirementsofholdinganonbindingadvisoryvoteonexecutivecompensationands

296、tockholderapprovalofanygoldenparachutepaymentsnotpreviouslyapproved.Wecannotpredictifinvestorswillfindourcommonstocklessattractivebecausewewillrelyontheseexemptions.Ifsomeinvestorsfindourcommonstocklessattractiveasaresult,theremaybealessactivetradingmarketforourcommonstockandourstockpricemaybemorevo

297、latile.Wewillremainanemerginggrowthcompanyuntiltheearliestof(i)theendofthefiscalyearinwhichthemarketvalueofourcommonstockthatisheldbynon-affiliatesexceeds$700millionasofJune30,(ii)theendofthefiscalyearinwhichwehavetotalannualgrossrevenuesof$1billionormoreduringsuchfiscalyear,(iii)thedateonwhichweiss

298、uemorethan$1billioninnon-convertibledebtinathree-yearperiodor(iv)March21,2018.Wemaynotbeabletoutilizeasignificantportionofournetoperatinglossorresearchtaxcreditcarryforwards,whichcouldadverselyaffectourprofitability.AsofDecember31,2015,wehadfederalandstatenetoperatinglosscarryforwardsduetopriorperio

299、dlosses,whichifnotutilizedwillbegintoexpirein2026and2016forfederalandstatepurposes,respectively.Wealsohavefederalresearchtaxcreditcarryforwards,whichifnotutilizedwillbegintoexpirein2026.Thesenetoperatinglossandresearchtaxcreditcarryforwardscouldexpireunusedandbeunavailabletooffsetfutureincometaxliab

300、ilities,whichcouldadverselyaffectourprofitability.Inaddition,underSection382oftheInternalRevenueCodeof1986,asamended(the“Code”),ourabilitytoutilizenetoperatinglosscarryforwardsorothertaxattributes,suchasresearchtaxcredits,inanytaxableyearmaybelimitedifweexperiencean“ownershipchange.”ASection382“owne

301、rshipchange”generallyoccursifoneormorestockholdersorgroupsofstockholderswhoownatleast5%ofourstockincreasetheirownershipbymorethan50percentagepointsovertheirlowestownershippercentagewithinarollingthree-yearperiod.Similarrulesmayapplyunderstatetaxlaws.Futureissuancesofourstockcouldcausean“ownershipcha

302、nge.”Itispossiblethatanyfutureownershipchangecouldhaveamaterialeffectontheuseofournetoperatinglosscarryforwardsorothertaxattributes,whichcouldadverselyaffectourprofitability.22OurreportedfinancialresultsmaybeadverselyaffectedbychangesinaccountingprinciplesgenerallyacceptedintheUnitedStates.Generally

303、acceptedaccountingprinciplesintheUnitedStatesaresubjecttointerpretationbytheFinancialAccountingStandardsBoard(“FASB”),theSEC,andvariousbodiesformedtopromulgateandinterpretappropriateaccountingprinciples.Achangeintheseprinciplesorinterpretationscouldhaveasignificanteffectonourreportedfinancialresults

304、,andcouldaffectthereportingoftransactionscompletedbeforetheannouncementofachange.Risks Related to the Ownership of Our Common StockThetradingpricesofthesecuritiesoftechnologycompanieshavebeenhighlyvolatile.Accordingly,themarketpriceofourcommonstockhasbeen,andislikelytocontinuetobe,subjecttowidefluct

305、uationsandcouldsubjectustolitigation.Sinceourinitialpublicoffering,theclosingsalespriceofourcommonstockontheNewYorkStockExchangehasbeenvolatile.Factorsaffectingthemarketpriceofourcommonstockinclude:variationsin,orforwardlookingguidanceregarding,ourrevenues,grossmargin,operatingresults,freecashflow,l

306、osspershare,numberofactiveadvertisers,revenueretentionrates,annualizedadvertisingspendonourplatform,adjustedEBITDAandhowtheseresultscomparetoanalystexpectations;announcementsoftechnologicalinnovations,newproductsorservices,strategicalliances,acquisitionsorsignificantagreementsbyusorbyourcompetitors;

307、disruptionsinourcloud-basedoperationsorservicesordisruptionsofotherprominentcloud-basedoperationsorservices;theeconomyasawhole,marketconditionsinourindustry,andtheindustriesofourcustomers;andanyotherfactorsdiscussedherein.Inaddition,thestockmarketingeneralhasexperiencedsubstantialpriceandvolumevolat

308、ilitythatisoftenseeminglyunrelatedtotheoperatingresultsofanyparticularcompanies.Moreover,ifthemarketfortechnologystocks,especiallysoftwareandcloudcomputing-relatedstocks,orthestockmarketingeneralexperiencesuneveninvestorconfidence,themarketpriceofourcommonstockcoulddeclineforreasonsunrelatedtoourbus

309、iness,operatingresultsorfinancialcondition.Themarketpriceforourstockmightalsodeclineinreactiontoeventsthataffectothercompanieswithin,oroutside,ourindustry,eveniftheseeventsdonotdirectlyaffectus.Somecompaniesthathaveexperiencedvolatilityinthetradingpriceoftheirstockhavebeensubjectofsecuritieslitigati

310、on.Ifwearethesubjectofsuchlitigation,itcouldresultinsubstantialcostsandadiversionofmanagementsattentionandresources.FromJanuary1,2015throughDecember31,2015,theclosingsalespriceofourcommonstockontheNewYorkStockExchangerangedfrom$3.11to$8.56pershare,andhasalowclosingpriceof$2.70pershareduringtheperiod

311、fromJanuary1,2016throughFebruary12,2016.Becauseourstockpricehasbeenvolatile,investinginourcommonstockisrisky.Wedonotintendtopaydividendsfortheforeseeablefuture.Wehaveneverdeclarednorpaidcashdividendsonourcapitalstock.Wecurrentlyintendtoretainanyfutureearningstofinancetheoperationandexpansionofourbus

312、iness,andwedonotexpecttodeclareorpayanydividendsintheforeseeablefuture.Consequently,stockholdersmustrelyonsalesoftheircommonstockafterpriceappreciation,whichmayneveroccur,astheonlywaytorealizeanyfuturegainsontheirinvestment.Iftherearesubstantialsalesofsharesofourcommonstock,thepriceofourcommonstockc

313、oulddecline.Salesofasubstantialnumberofsharesofourcommonstockinthepublicmarket,ortheperceptionthatthesesalesmightoccurcoulddepressthemarketpriceofourcommonstockandmaymakeitmoredifficultforyoutosellyourcommonstockatatimeandpricethatyoudeemappropriate.Weareunabletopredicttheeffectthatsalesmayhaveonthe

314、prevailingmarketpriceofourcommonstock.WehavecurrentlyeffectiveRegistrationStatementsonFormS-3registeringforsaleapproximately1.6millionand1.7millionsharesofourcommonstockissuedortobeissuedinconnectionwithouracquisitionsofSocialMoovandPerfectAudience,respectively.Iftheholdersofthesesharesseektosellthe

315、irholdings,particularlyinsignificantamountsincompressedtimeframes,thetradingpriceofourcommonstockcouldbeadverselyimpacted.AportionofthesharesregisteredinconnectionwiththeacquisitionofSocialMoovwillnotbeissued,ifatall,untilthetwoyearanniversaryoftheclosingoftheacquisition.Afterourinitialpublicofferin

316、ginMarch2013,theholdersofanaggregateof18.8millionsharesofourcommonstockhadrights,subjecttosomeconditions,torequireustofileregistrationstatementscoveringtheirsharesortoincludetheirsharesinregistrationstatementsthatwemayfileforourselvesorourstockholders.Totheextenttheholdersofsuchshareshavenotsoldthes

317、haresotherwise,suchholdersmaycontinuetohaveregistrationrights.RegistrationofthesesharesundertheSecuritiesActwouldresultinthesharesbecoming23freelytradablewithoutrestrictionundertheSecuritiesAct.Anysalesofsecuritiesbyexistingstockholderscouldadverselyaffectthetradingpriceofourcommonstock.Delawarelawa

318、ndprovisionsinourrestatedcertificateofincorporationandrestatedbylawscouldmakeamerger,tenderoffer,orproxycontestdifficult,therebydepressingthetradingpriceofourcommonstock.OurstatusasaDelawarecorporationandtheanti-takeoverprovisionsoftheDelawareGeneralCorporationLawmaydiscourage,delay,orpreventachange

319、incontrolbyprohibitingusfromengaginginabusinesscombinationwithaninterestedstockholderforaperiodofthreeyearsafterthepersonbecomesaninterestedstockholder,evenifachangeofcontrolwouldbebeneficialtoourexistingstockholders.Inaddition,ourrestatedcertificateofincorporationandrestatedbylawscontainprovisionst

320、hatmaymaketheacquisitionofourCompanymoredifficult,includingthefollowing:ourboardofdirectorsareclassifiedintothreeclassesofdirectorswithstaggeredthree-yeartermsanddirectorscanonlyberemovedfromofficeforcause;onlyourboardofdirectorshastherighttofillavacancycreatedbytheexpansionofourboardofdirectorsorth

321、eresignation,deathorremovalofadirector,whichpreventsstockholdersfrombeingabletofillvacanciesonourboardofdirectors;onlyourchairmanoftheboard,ourleadindependentdirector,ourchiefexecutiveofficer,ourpresident,oramajorityofourboardofdirectorsisauthorizedtocallaspecialmeetingofstockholders;certainlitigati

322、onagainstuscanonlybebroughtinDelaware;ourrestatedcertificateofincorporationauthorizesundesignatedpreferredstock,thetermsofwhichmaybeestablished,andsharesofwhichmaybeissued,withouttheapprovaloftheholdersofcommonstock;andadvancenoticeproceduresapplyforstockholderstonominatecandidatesforelectionasdirec

323、torsortobringmattersbeforeanannualmeetingofstockholders.Ifsecuritiesorindustryanalystsdonotpublishresearchorpublishinaccurateorunfavorableresearchaboutourbusiness,ourstockpriceandtradingvolumecoulddecline.Thetradingmarketforourcommonstockdependsinpartontheresearchandreportsthatsecuritiesorindustryan

324、alystspublishaboutusorourbusiness.Ifoneormoreoftheanalystswhocoverusdowngradeourcommonstockorpublishinaccurateorunfavorableresearchaboutourbusiness,ourcommonstockpricewouldlikelydecline.Ifoneormoreoftheseanalystsceasecoverageofusorfailtopublishreportsonusregularly,demandforourcommonstockcoulddecreas

325、e,whichmightcauseourcommonstockpriceandtradingvolumetodecline.24ITEM 1B.UNRESOLV ED STAFF COMMENTSNone.ITEM 2.PROPERTIESOurcorporateheadquartersarelocatedinSanFrancisco,California,whereweoccupyfacilitiestotalingapproximately43,000squarefeetunderaleasewhichexpiresinJuly2022.Weusethesefacilitiesforadm

326、inistration,salesandmarketing,researchanddevelopment,engineering,customersupportandprofessionalservices.InDecember2015,weenteredintoanagreementtosubleaseapproximately14,300squarefeetofthispropertytoanunrelatedthirdpartythroughDecember2017.WealsoleaseofficespaceinAustin,ChicagoandNewYorkintheUnitedSt

327、ates,andAustralia,England,France,Germany,Ireland,andJapan,whichweuseprincipallyforsalesandmarketing,administration,customersupportandtodeliverprofessionalserviceslocally.WealsoleaseofficespaceinPortland,OregonandShanghai,China,whichweuseprincipallyforengineering.Weoperatetwodatacentersatthird-partyf

328、acilitieslocatedintheUnitedStatesandIreland.Webelieveourfacilitiesareingoodconditionandadequateforourcurrentneedsandfortheforeseeablefuture.SeeNote16totheConsolidatedFinancialStatementsand“ManagementsDiscussionandAnalysisofFinancialConditionandResultsofOperationsContractualObligationsandCommitments”

329、forinformationregardingourleaseobligations.ITEM 3.LEGAL PROCEEDINGSFromtimetotime,wemaybecomeinvolvedinlegalproceedingsarisingintheordinarycourseofourbusiness.Wearenotpresentlyapartytoanylegalproceedingsthat,ifdeterminedadverselytous,wouldindividuallyortakentogetherhaveamaterialadverseeffectonourbus

330、iness,operatingresults,financialconditionorcashflows.ITEM 4.MINE SAFETY DISCLOSURESNotapplicable.25PART IIITEM 5.MARKET FOR REGISTRANTS COMMON EQUITY,RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OFEQUITY SECURITIESMarket Price of Our Common StockOurcommonstockhastradedontheNewYorkStockExchange(“

331、NYSE”)sinceMarch22,2013,underthesymbolMRIN.Priortothisdate,therewasnopublicmarketforourcommonstock.Thefollowingtablessetforth,fortheperiodsindicated,thehighandlowsalespriceofourcommonsharesasreportedbytheNYSE.High Low YearEndedDecember31,2015 FirstQuarter$8.56$5.94SecondQuarter$7.58$5.47ThirdQuarter

332、$6.76$3.11FourthQuarter$4.04$3.15High Low YearEndedDecember31,2014 FirstQuarter$12.57$9.17SecondQuarter$12.65$8.41ThirdQuarter$12.14$7.30FourthQuarter$9.68$7.79Holders of our Common StockAsofFebruary16,2016,therewere93stockholdersofrecord.Theactualnumberofstockholdersisgreaterthanthenumberofrecordho

333、lders,andincludesstockholderswhoarebeneficialowners,butwhosesharesareheldinstreetnamebybrokersandothernominees.Thenumberofholdersofrecordalsodoesnotincludestockholderswhosesharesmaybeheldintrustbyotherentities.Dividend PolicyWehaveneverdeclaredorpaidanycashdividendsonourcommonstock.Wecurrentlyintendtoretainanyfutureearningsanddonotexpecttopayanycashdividendsonourcommonstockfortheforeseeablefuture.