GAAP Operating Cash Flow of $5.2 Million and Non-GAAP Free Cash Flow of $0.9 Million in the Second Quarter of 2016

GAAP Net Loss Improved $7.7 Million and Non-GAAP Adjusted EBITDA Increased from $1.4 Million to $4.2 Million Year-on-Year

REDWOOD CITY, Calif., Aug. 02, 2016 (GLOBE NEWSWIRE) -- Rocket Fuel Inc. (NASDAQ:FUEL), a leading programmatic marketing platform provider, today announced financial results for the second quarter ended June 30, 2016.

"We executed well in Q2 and delivered solid results meeting or exceeding our guidance," said Randy Wootton, chief executive officer.  "In the quarter, we reported significantly improved positive adjusted EBITDA, which drove positive free cash flow a quarter earlier than we expected. We did this by focusing on our three strategic imperatives of becoming a trusted platform partner, strengthening our brand value proposition, and extending our direct response leadership across all devices, while strengthening executional rigor across the company. Looking forward, I believe Rocket Fuel is poised for continued success, as we continue to execute on our growth strategy of making marketing more meaningful for agencies and their clients."

Financial Highlights for the Second Quarter of 2016

GAAP Revenue: $117.0 million, 3% below last year's second quarter total of $120.1 million.

North America was $92.8 million, down 9% from last year's second quarter. Revenue from outside North America was $24.1 million, up 31% from last year.

Platform Solutions grew significantly year-on-year, representing 18% of GAAP revenue in the second quarter versus 6% in last year's second quarter. Media Services was 82% and 94%, respectively.

Non-GAAP Net Revenue: $66.0 million, down 7% compared to $70.9 million non-GAAP Net Revenue in the second quarter of 2015.

GAAP Net Loss: $(16.7) million, or $(0.38) per diluted share compared to a net loss of $(24.4) million, or $(0.58) per diluted share, in the second quarter of 2015.

Non-GAAP Adjusted EBITDA: $4.2 million compared to $1.4 million in the second quarter of 2015.

Non-GAAP Adjusted Net Loss: $(6.7) million, or $(0.15) per diluted share, compared to an adjusted net loss of $(7.2) million, or $(0.17) per diluted share, for the second quarter of 2015.

GAAP Net Cash provided by (used in) Operating Activities: $5.2 million, compared to $(2.9) million in the second quarter of 2015.

Non-GAAP Free Cash Flow: $0.9 million, compared to $(10.4) million in the second quarter of 2015.

Cash and Cash Equivalents: $66.7 million as of June 30, 2016, down sequentially by $0.7 million from the first quarter 2016. Cash and Cash Equivalents was $78.6 million as of December 31, 2015.

Top Customers: Revenue from top 50 customers was 53% of total revenue, compared to 47% in the second quarter of fiscal year 2015. Revenue from top 250 customers was 82% of total revenue, compared to 78% in the second quarter of fiscal year 2015.

Employee Headcount: 899 as of June 30, 2016, down from 1,008 in the second quarter of 2015.

Financial Outlook for the Third Quarter of 2016

For the third quarter of 2016, the Company expects:

-  Non-GAAP net revenue between $63 million and $66 million.

-  Non-GAAP Adjusted EBITDA between $4 million and $7 million.

The Company does not reconcile its forward-looking non-GAAP financial measures, net revenue and Adjusted EBITDA, to the corresponding GAAP measures due to the high variability and difficulty in making accurate forecasts and projections in respect to the interplay between revenue and the corresponding margins. Our Media Services and Platform Solutions have different media margins and the pace of the transition of some of our business from Media Services to Platform Solutions, the pace of adoption, or activation of existing Platform Solutions customers, and the corresponding future margins cannot be reasonably predicted. The GAAP measure net income includes stock-based compensation expense that is impacted by future hiring and retention needs, the impact of our tender offer which completed at the end of Q2 and the future share price of Rocket Fuel's stock. Similarly, restructuring charges, which we exclude from our non-GAAP measure Adjusted EBITDA, are impacted by future decisions and by actions involving our facilities that are difficult to predict. The actual amounts of these excluded items will have a significant impact on the Company's GAAP net income. Accordingly, reconciliations of these two forward-looking non-GAAP financial measures to the corresponding GAAP measures are not available without unreasonable effort.

Conference Call, Webcast and Related Information

The Rocket Fuel second quarter 2016 teleconference and webcast is scheduled to begin at 2:00 PM Pacific time on Tuesday, August 2, 2016. To participate on the live call, analysts and investors should dial 1-888-395-3227, or outside the U.S. 719-457-2697, at least ten minutes prior to the call. Rocket Fuel will post supplemental slides with the Company's latest financial results on http://investor.rocketfuel.com under Events & Presentations concurrently with this earnings press release. Rocket Fuel will also offer a live and archived webcast of the conference call, accessible from the "Investors" section of its website at http://investor.rocketfuel.com.

Use of Non-GAAP Measures

We provide information relating to non-GAAP net revenue, non-GAAP adjusted EBITDA, non-GAAP adjusted net income (loss), non-GAAP operating expenses and non-GAAP free cash flow, which are financial measures that have not been prepared in accordance with generally accepted accounting principles in the United States ("GAAP"). These non-GAAP financial measures have been included in this press release, or discussed on our teleconference and webcast, because they are measures used by our management and board of directors to understand and evaluate our core operating performance and trends, to prepare and approve our annual budget, and to develop short- and long-term operational plans.

We define non-GAAP net revenue as GAAP revenue less media costs. Media costs consist of costs for advertising impressions we purchase from advertising exchanges or other third parties. A limitation of non-GAAP net revenue is that it is a measure designed for internal purposes that may be unique to Rocket Fuel and may not enhance the comparability of Rocket Fuel's results to other companies in the same industry that have similar business arrangements but present the impact of media costs differently. Our management compensates for this limitation by also considering the comparable GAAP financial measures of revenue, media costs and other costs of revenue.

We define non-GAAP adjusted EBITDA as GAAP net income (loss) before interest expense, other income (expense), net, income tax provision (benefit), depreciation and amortization expense (including amortization of capitalized software development expenses), stock-based compensation expense and related payroll taxes, acquisition and restructuring related expenses, and impairment charges. Non-GAAP adjusted EBITDA has a number of limitations, including the following: although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future and non-GAAP adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements or for new capital expenditure requirements; non-GAAP adjusted EBITDA is often considered an approximation of operating cash flow, but in our case excludes software development costs capitalized in a current period and excludes those costs as they are amortized over future periods; non-GAAP adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs; non-GAAP adjusted EBITDA does not consider the potentially dilutive impact of equity-based compensation; non-GAAP adjusted EBITDA does not reflect acquisition and restructuring related expenses, the expenses capitalized for internal-use software, tax and interest expenses that may represent payments reducing the cash available to us; and other companies, including those in our industry, may calculate non-GAAP adjusted EBITDA differently, which reduces its usefulness as a comparative measure. Because of these limitations, our management considers non-GAAP adjusted EBITDA alongside other financial performance measures, including cash flow metrics, net income (loss) and our other GAAP results.

We define non-GAAP adjusted net income (loss) as GAAP net income (loss) excluding stock-based compensation expense, amortization of intangible assets, impairment charges, acquisition and restructuring related expenses and the estimated tax impact of the foregoing items. A limitation of non-GAAP adjusted net income (loss) is that it is a measure that may be unique to Rocket Fuel and may not enhance the comparability of Rocket Fuel's results to other companies in the same industry that define adjusted net income (loss) differently. This measure may also exclude expenses that may have a material impact on Rocket Fuel's reported financial results. Our management compensates for these limitations by also considering the comparable GAAP financial measure of net income (loss).

We define non-GAAP operating expenses as GAAP total costs and expenses less media costs, depreciation and amortization expense (including amortization of capitalized software development costs), impairment charges, stock-based compensation expense and related payroll taxes, and acquisition and restructuring related expense. Non-GAAP operating expenses has a number of limitations, including the following: although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future and this measure does not reflect cash capital expenditure requirements for such replacements or for new capital expenditure requirements; non-GAAP operating expenses is often considered an approximation of operating cash flow, but in our case excludes software development costs capitalized in a current period and excludes those costs as they are amortized over future periods; non-GAAP operating expenses does not reflect changes in, or cash requirements for, our working capital needs; non-GAAP operating expenses does not consider the potentially dilutive impact of equity-based compensation; non-GAAP operating expenses does not reflect acquisition and restructuring related expenses, the expenses capitalized for internal-use software, tax and interest expenses that may represent payments reducing the cash available to us; and other companies, including those in our industry, may calculate non-GAAP operating expenses differently, which reduces its usefulness as a comparative measure. Because of these limitations, our management considers non-GAAP operating expenses alongside other financial performance measures, including total expenses, cash from operating activities and our other GAAP results.

In addition, we provide information about our non-GAAP free cash flow. We define non-GAAP free cash flow as the net cash provided by (or used in) operating activities less the cash used for purchases of property, equipment and software and for capitalized internal-use software development costs. A limitation of free cash flow is that it may be unique to Rocket Fuel and may not enhance the comparability of Rocket Fuel's results to other companies in the same industry that define free cash flow differently from us. This measure also does not represent the residual cash flow available to us for discretionary expenditures or investments because we have mandatory capital leases and debt service requirements that may have a material impact on Rocket Fuel's liquidity. Our management compensates for these limitations by also considering the comparable GAAP financial measure of net cash provided by (or used in) operating activities.

For a reconciliation of non-GAAP financial measures to the nearest comparable GAAP financial measures, see "Reconciliation from GAAP Revenue to Non-GAAP Net Revenue," "Reconciliation from GAAP Net Income (Loss) to Non-GAAP Adjusted EBITDA," "Reconciliation from GAAP Net Income (Loss) to Non-GAAP Adjusted Net Income (Loss)", "Reconciliation from GAAP Total Cost and Expenses to Non-GAAP Operating Expenses" and "Reconciliation from GAAP Net Cash Provided by (or Used in) Operating Activities to Non-GAAP Free Cash Flow" included in this press release.

These non-GAAP financial measures are not intended to be considered in isolation from, as substitutes for, or as superior to, the corresponding financial measures prepared in accordance with GAAP.

Cautions Regarding Forward-Looking Statements

This press release and the webcast of the same date contain forward-looking statements regarding future events and our future financial performance, including but not limited to expected progress against achieving our three strategic imperatives including but not limited to growing our brand, direct response, and platform businesses; the value of our moment scoring technology; our customer and partnership strategies and focus on high value accounts; expectations regarding growth in our platform solutions business and changes in revenue and margin mix; our ability to grow our media services business and improve relationships with agencies and agency holding companies; expected investment in international growth; our anticipated capital expenditures; and expectations for third quarter non-GAAP net revenue and non-GAAP adjusted EBITDA, and financial goals for fiscal year 2016. Words such as "expect," "believe," "intend," "plan," "goal," "focus" and other similar words are also intended to identify forward-looking statements.

These forward-looking statements are subject to a number of risks and uncertainties that may cause actual results to differ materially from the results anticipated by such statements, including, without limitation: our limited operating history, particularly as a relatively new public company; fluctuations in our operating results, including but not limited to fluctuations due to seasonality; our history of losses; our ability to achieve the expected benefits of our efficiency improvement plans; risks due to employee attrition and integration of new leadership and employees; risks associated with our growth, including growth outside of the U.S.; our ability to adequately address competition, particularly from agency trading desks; our ability to serve the needs of agencies and agency holding companies and make the right investment decisions with regard to new products, technology, and sales strategies; and risks associated with maintaining or increasing sales to new and existing customers and maintaining customer satisfaction.

Additional factors that could cause actual results to differ materially from those anticipated by our forward-looking statements are under the caption "Risk Factors" in our Annual Report on Form 10K filed with the Securities and Exchange Commission ("SEC") on March 14, 2016 and in subsequent SEC filings. These forward-looking statements are made as of the date of this press release and the related webcast, and Rocket Fuel expressly disclaims any obligation or undertaking to update the forward-looking statements contained herein or therein to reflect events that occur or circumstances that exist after the date on which the statements were made.

About Rocket Fuel

Rocket Fuel applies artificial intelligence and big data to predict the potential of every moment and make marketing more meaningful and accountable.

Headquartered in Redwood City, California, Rocket Fuel has more than 20 offices worldwide and trades on the NASDAQ Global Select Market under the ticker symbol "FUEL." For more information, please visit http://www.rocketfuel.com or call 1-888-717-8873.

Rocket Fuel, the Rocket Fuel logo, Moment Scoring, Advertising That Learns and Marketing That Learns are trademarks or registered trademarks of Rocket Fuel Inc. in the United States and other countries.

 
Rocket Fuel Inc.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
         
    June 30,   December 31,
    2016   2015
Assets        
Current Assets:        
Cash and cash equivalents   $ 66,664     $ 78,560  
Accounts receivable, net   114,038     124,998  
Prepaid expenses   3,071     3,803  
Other current assets   3,895     2,081  
Total current assets   187,668     209,442  
Property, equipment and software, net   68,524     82,781  
Restricted cash   1,876     2,141  
Intangible assets, net   42,665     50,919  
Deferred tax assets, net   525     718  
Other assets   1,243     1,053  
Total Assets   $ 302,501     $ 347,054  
         
Liabilities and Stockholders' Equity        
Current Liabilities:        
Accounts payable   $ 64,059     $ 71,292  
Accrued and other current liabilities   33,745     40,734  
Deferred revenue   1,988     2,116  
Current portion of capital leases   8,737     8,602  
Current portion of debt   62,035     45,720  
Total current liabilities   170,564     168,464  
Debt - Less current portion       17,617  
Capital leases - Less current portion   8,148     11,855  
Deferred rent - Less current portion   15,897     14,042  
Other liabilities   1,311     1,176  
Total liabilities   195,920     213,154  
         
Stockholders' Equity:        
Common stock   44     44  
Additional paid-in capital   463,959     453,338  
Accumulated other comprehensive loss   (625 )   (151 )
Accumulated deficit   (356,797 )   (319,331 )
Total stockholders' equity   106,581     133,900  
Total Liabilities and Stockholders' Equity   $ 302,501     $ 347,054  

 
Rocket Fuel Inc.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except loss per share data)
                 
    Three Months Ended   Six Months Ended
    June 30,   June 30,
    2016   2015   2016   2015
Revenue   $ 116,968     $ 120,065     $ 221,713     $ 224,399  
Costs and expenses:                
Media costs   50,922     49,155     93,481     94,716  
Other cost of revenue (1)   20,397     19,826     40,482     39,782  
Research and development (1)   9,438     11,791     20,077     23,114  
Sales and marketing (1)   36,190     41,750     73,030     84,628  
General and administrative (1)   12,765     14,761     27,086     32,335  
Restructuring   1,766     6,471     1,567     6,471  
Total costs and expenses   131,478     143,754     255,723     281,046  
Operating loss   (14,510 )   (23,689 )   (34,010 )   (56,647 )
Interest expense   1,032     1,045     2,269     2,385  
Other (income) expense, net   866     (696 )   672     1,512  
Loss before income taxes   $ (16,408 )   $ (24,038 )   $ (36,951 )   $ (60,544 )
Income tax provision   285     372     515     729  
Net loss   $ (16,693 )   $ (24,410 )   $ (37,466 )   $ (61,273 )
                 
Basic and diluted net income (loss) per share attributable to common stockholders   $ (0.38 )   $ (0.58 )   $ (0.85 )   $ (1.45 )
Basic and diluted weighted-average shares used to compute net loss per share attributable to common stockholders   44,056     42,296     43,828     42,140  
 

(1) Includes unaudited stock-based compensation expense as follows (in thousands):
     
    Three Months Ended
    June 30,
    2016   2015
Other cost of revenue   $ 493     $ 477  
Research and development   981     1,834  
Sales and marketing   1,357     2,325  
General and administrative   1,251     1,798  
    $ 4,082     $ 6,434  

 
Rocket Fuel Inc.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
    Three Months Ended   Six Months Ended
    June 30,   June 30,
    2016   2015   2016   2015
Operating Activities:                
Net loss   $ (16,693 )   $ (24,410 )   $ (37,466 )   $ (61,273 )
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:                
Depreciation and amortization   12,881     12,157     25,145     24,023  
Impairment of long-lived assets   1,225     2,704     1,225     2,704  
Accelerated amortization of leasehold improvements   3,526         7,059      
Stock-based compensation   4,082     6,434     8,892     13,881  
Deferred taxes   197     (305 )   193     (20 )
Other non-cash adjustments, net   253     535     1,607     1,044  
Changes in operating assets and liabilities:                
Accounts receivable   (4,001 )   (7,187 )   10,102     15,362  
Prepaid expenses and other assets   (413 )   939     (2,209 )   6,318  
Accounts payable   3,054     3,274     (7,792 )   (11,538 )
Accrued and other liabilities   3,727     4,453     1,876     182  
Deferred rent   (3,029 )   (294 )   (6,103 )   890  
Deferred revenue   346     (1,192 )   (128 )   1,338  
Net cash provided by (used in) operating activities   5,155     (2,892 )   2,401     (7,089 )
                 
Investing Activities:                
Purchases of property, equipment and software   (1,268 )   (4,566 )   (3,055 )   (10,085 )
Capitalized internal-use software development costs   (3,000 )   (2,972 )   (5,924 )   (6,048 )
Proceeds from sale of property           293      
Change in restricted cash           39     636  
Net cash used in investing activities   (4,268 )   (7,538 )   (8,647 )   (15,497 )
                 
Financing Activities:                
Proceeds from employee stock plans, net   1,052     2,950     1,080     3,139  
Tax withholdings related to net share settlements of restricted stock units   (368 )   (533 )   (609 )   (533 )
Repayment of capital lease obligations   (2,126 )   (1,665 )   (4,218 )   (2,755 )
Proceeds from debt facilities, net of issuance costs           22,350     (242 )
Repayment of debt facilities       (1,500 )   (24,000 )   (3,000 )
Net cash used in financing activities   (1,442 )   (748 )   (5,397 )   (3,391 )
                 
Effect of Exchange Rate Changes on Cash and Cash Equivalents   (173 )   188     (253 )   (14 )
Change in Cash and Cash Equivalents   (728 )   (10,990 )   (11,896 )   (25,991 )
Cash and Cash Equivalents—Beginning of period   67,392     92,055     78,560     107,056  
Cash and Cash Equivalents—End of period   $ 66,664     $ 81,065     $ 66,664     $ 81,065  

         
    Three Months Ended   Six Months Ended
    June 30,   June 30,
    2016   2015   2016   2015
Supplemental Disclosures of Other Cash Flow Information:                
Cash paid for income taxes, net of refunds   $ 33     $ 249     $ 384     $ 454  
Cash paid for interest   916     1,007     1,937     1,921  
Supplemental Disclosures of Non-Cash Investing and Financing Activities:                
Purchases of property, equipment and software recorded in accounts payable and accruals   $ 1,808     $ (195 )   $ 2,371     $ 428  
Property, equipment and software acquired under capital lease obligations   495     1,461     646     1,786  
Vesting of early exercised options       44     25     97  
Stock-based compensation capitalized in internal-use software costs   597     792     1,308     1,286  

 
Rocket Fuel Inc.
UNAUDITED NON-GAAP MEASURES
(In thousands, except per share data)
                 
    Three Months Ended   Six Months Ended
    June 30,   June 30,
    2016   2015   2016   2015
Non-GAAP net revenue   $ 66,046     $ 70,910     $ 128,232     $ 129,683  
Non-GAAP adjusted EBITDA   $ 4,219     $ 1,394     $ 1,594     $ (12,232 )
Non-GAAP adjusted net income (loss)   $ (6,718 )   $ (7,177 )   $ (18,753 )   $ (32,276 )
Non-GAAP adjusted diluted net income (loss) per share   $ (0.15 )   $ (0.17 )   $ (0.43 )   $ (0.77 )
Non-GAAP operating expenses   $ 61,827     $ 69,516     $ 126,638     $ 141,915  
Non-GAAP free cash flow   $ 887     $ (10,430 )   $ (6,578 )   $ (23,222 )

 
Rocket Fuel Inc.
UNAUDITED RECONCILIATION FROM GAAP REVENUE TO NON-GAAP NET REVENUE
(In thousands)
                 
    Three Months Ended   Six Months Ended
    June 30,   June 30,
    2016   2015   2016   2015
Revenue   $ 116,968     $ 120,065     $ 221,713     $ 224,399  
Less: Media costs   50,922     49,155     93,481     94,716  
Non-GAAP net revenue   $ 66,046     $ 70,910     $ 128,232     $ 129,683  

 
Rocket Fuel Inc.
UNAUDITED RECONCILIATION FROM GAAP NET LOSS TO NON-GAAP ADJUSTED EBITDA
(In thousands)
                 
    Three Months Ended   Six Months Ended
    June 30,   June 30,
    2016   2015   2016   2015
Net loss   $ (16,693 )   $ (24,410 )   $ (37,466 )   $ (61,273 )
Adjustments:                
Interest expense   1,032     1,045     2,269     2,385  
Income tax provision (benefit)   285     372     515     729  
Amortization of intangibles   4,127     4,227     8,254     8,454  
Amortization of capitalized software   2,743     1,807     5,033     3,444  
Depreciation   6,011     6,124     11,858     12,126  
Stock-based compensation expense   4,082     6,434     8,892     13,881  
Other (income) expense, net   866     (696 )   672     1,512  
Restructuring expense (credit), net   1,766     6,471     1,567     6,471  
Payroll tax expense related to stock-based compensation       20         39  
Total adjustments   20,912     25,804     39,060     49,041  
Non-GAAP adjusted EBITDA   $ 4,219     $ 1,394     $ 1,594     $ (12,232 )

 
Rocket Fuel Inc.
UNAUDITED RECONCILIATION FROM GAAP NET LOSS TO NON-GAAP ADJUSTED NET INCOME (LOSS)
(In thousands, except per share data)
                 
    Three Months Ended   Six Months Ended
    June 30,   June 30,
    2016   2015   2016   2015
Net loss   $ (16,693 )   $ (24,410 )   $ (37,466 )   $ (61,273 )
Stock-based compensation expense   4,082     6,434     8,892     13,881  
Amortization of intangible assets   4,127     4,227     8,254     8,454  
Restructuring expense (credit), net   1,766     6,471     1,567     6,471  
Tax impact of the above items       101         191  
Non-GAAP adjusted net income (loss)   $ (6,718 )   $ (7,177 )   $ (18,753 )   $ (32,276 )
                 
Basic and diluted net income (loss) per share attributable to common stockholders   $ (0.38 )   $ (0.58 )   $ (0.85 )   $ (1.45 )
                 
Non-GAAP adjusted net income (loss) per diluted share   $ (0.15 )   $ (0.17 )   $ (0.43 )   $ (0.77 )
                 
Weighted average shares used in computing non-GAAP adjusted net income (loss) per diluted share   44,056   42,296   43,828   42,140

 
Rocket Fuel Inc.
UNAUDITED RECONCILIATION FROM GAAP TOTAL COSTS AND EXPENSES TO NON-GAAP OPERATING EXPENSES
(In thousands)
                 
    Three Months Ended   Six Months Ended
    June 30,   June 30,
    2016   2015   2016   2015
Total costs and expenses   $ 131,478     $ 143,754     $ 255,723     $ 281,046  
Less media costs   50,922     49,155     93,481     94,716  
Adjustments:                
Amortization of intangibles   4,127     4,227     8,254     8,454  
Amortization of capitalized software   2,743     1,807     5,033     3,444  
Depreciation   6,011     6,124     11,858     12,126  
Stock-based compensation   4,082     6,434     8,892     13,881  
Restructuring expense (credit), net   1,766     6,471     1,567     6,471  
Payroll tax expense related to stock based compensation       20         39  
Total adjustments   18,729     25,083     35,604     44,415  
Non-GAAP operating expenses   $ 61,827     $ 69,516     $ 126,638     $ 141,915  

 
Rocket Fuel Inc.
UNAUDITED RECONCILIATION FROM CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES TO NON-GAAP FREE CASH FLOW
(In thousands)
                 
    Three Months Ended   Six Months Ended
    June 30,   June 30,
    2016   2015   2016   2015
Cash provided by (used in) operating activities   5,155     (2,892 )   2,401     (7,089 )
Less: Purchases of property, equipment and software   (1,268 )   (4,566 )   (3,055 )   (10,085 )
Less: Capitalized internal-use software development costs   (3,000 )   (2,972 )   (5,924 )   (6,048 )
Non-GAAP free cash flow   $ 887     $ (10,430 )   $ (6,578 )   $ (23,222 )
 

 
Investor Relations:(650) 481-6082ir@rocketfuel.com

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