Shutterstock reports big net income increase
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Shutterstock, Inc. announced financial results for the second quarter ended June 30, 2023. Second-quarter revenue was basically flat at $208.8 million, but net income 157% to $50.0 million.
“I’m pleased to report that, as reflected in our second quarter results and our revised full-year outlook, Shutterstock is not only adapting but that it is thriving in this dynamic environment.” said Paul Hennessy, CEO, Shutterstock. “We recently signed a strategic multi-year content and data partnership with Google, we acquired GIPHY to lead the way in moment marketing and conversational content, and we are embracing a culture of rapid & iterative experimentation when it comes to optimizing our content business. At the same time, having achieved record revenue and adjusted EBITDA on a year-to-date basis, I’m pleased to report that we are increasing our guidance on top and bottom line for the full year 2023.”
Among the reported metrics:
- Subscribers increased to 556,000.
- Subscriber revenue increased to $87.4 million.
- Average revenue per customer increased to $374.
- Paid downloads decreased to 38.5 million.
- Revenue per download increased to $4.71.
- Image collection expanded to 734 million images.
- Footage collection expanded to 50 million clips.
Second quarter revenue of $208.8 million increased by $2.0 million or 1% as compared to the second quarter of 2022. Revenue generated through the E-commerce sales channel decreased 12% as compared to the second quarter of 2022, to $111.9 million, and represented 54% of total revenue in the second quarter of 2023. The decline in E-commerce revenue was primarily driven by continued weakness in new customer acquisition.
Revenue from Enterprise sales channel increased 22% as compared to the second quarter of 2022, to $96.9 million, and represented 46% of second-quarter revenue in 2023. The increase in Enterprise revenues was primarily driven by growth in our computer vision data partnerships which generated $17.3 million during the second quarter, compared to $2.2 million in the second quarter of 2022.
Net income of $50.0 million increased by $30.6 million as compared to $19.4 million for the second quarter in 2022. Net income per diluted share was $1.37, as compared to $0.53 for the same period in 2022.
$25.9 million of the increase in second quarter 2023 net income, or $0.71 per diluted share, is related to the acquisition of Giphy, Inc., which was completed on June 23, 2023. Giphy’s divestiture was a result of a UK Competition and Markets Authority’s (the “CMA”) regulatory order, and concurrently with the closing of the transaction, the Company and the seller entered into a transitional services agreement pursuant to which the seller is responsible for certain costs related to the retention of Giphy employees (the “Giphy Retention Compensation”). The acquisition resulted in the recognition of a $41.9 million non-taxable bargain purchase gain.
Adjusted net income per diluted share was $1.07 as compared to $0.83 for the second quarter of 2022, an increase of $0.24 per diluted share.
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Three Months Ended June 30, |
Six Months Ended June 30, |
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2023 |
2022 |
2023 |
2022 |
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Subscribers (end of period)(1) |
556,000 |
368,000 |
556,000 |
368,000 |
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Subscriber revenue (in millions)(2) |
$ 87.4 |
$ 84.7 |
$ 178.0 |
$ 170.1 |
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Average revenue per customer (last twelve months)(3) |
$ 374 |
$ 359 |
$ 374 |
$ 359 |
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Paid downloads (in millions)(4) |
38.5 |
43.4 |
81.2 |
88.0 |
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Revenue per download(5) |
$ 4.71 |
$ 4.46 |
$ 4.56 |
$ 4.34 |
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Content in our collection (end of period, in millions)(6): |
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Images |
734 |
511 |
734 |
511 |
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Footage clips |
50 |
27 |
50 |
27 |
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Subscribers, Subscriber Revenue and Average Revenue Per Customer from acquisitions are included in these metrics beginning twelve months after the closing of the respective business combination. Accordingly, the metrics include Subscribers, Subscriber revenue, and Average revenue per customer from TurboSquid beginning February 2022, from PicMonkey beginning September 2022, and from Pond5 and Splash News beginning May 2023. These metrics exclude the respective counts and revenues from Giphy. |
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(1) Subscribers is defined as those customers who purchase one or more of our monthly recurring products for a continuous period of at least three months, measured as of the end of the reporting period. |
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(2) Subscriber revenue is defined as the revenue generated from subscribers during the period. |
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(3) Average revenue per customer is calculated by dividing total revenue for the last twelve-month period by customers. Customers is defined as total active, paying customers that contributed to total revenue over the last twelve-month period. |
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(4) Paid downloads is the number of downloads that our customers make in a given period of our content. Paid downloads exclude content related to our Studios business, downloads of content that are offered to customers for no charge, including our free trials and downloads associated with our computer vision offering. |
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(5) Revenue per download is the amount of revenue recognized in a given period divided by the number of paid downloads in that period excluding revenue from our Studios business, revenue that is not derived from or associated with content licenses and revenue associated with our computer vision offering. |
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(6) Content in our collection represents approved images (photographs, vectors and illustrations) and footage (in number of clips) in our library at the end of the period. This metric excludes content that is not uploaded directly to our site but is available for license by our customers through an application program interface, content from our Studios business and AI generated content. Prior to December 31, 2022, this metric only included approved images and footage clips in our library on shutterstock.com at the end of the period. |
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