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Consolidated Financial Statements Details | 3 Months Ended
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Mar. 31, 2025
Organization, Consolidation and Presentation of Financial Statements [Abstract] |
Consolidated Financial Statements Details | 8. Consolidated Financial Statement Details Consolidated Balance Sheets Details Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following:
|  | March 31, 2025 |  |  | December 31, 2024 |
Prepaid expenses |  | $ | 6,202 |  |  | $ | 5,234 |
Indemnification escrow holdback |  |  | 3,650 |  |  |  | 3,650 |
Other receivables |  |  | 802 |  |  |  | 854 |
Other current assets |  |  | 730 |  |  |  | 760 |
Prepaid expenses and other current assets |  | $ | 11,384 |  |  | $ | 10,498 |
Other Assets Other assets consisted of the following:
|  | March 31, 2025 |  |  | December 31, 2024 |
Fair value of earnout receivable |  | $ | 11,321 |  |  | $ | 7,667 |
Investments |  |  | 2,990 |  |  |  | 2,990 |
Deferred tax assets |  |  | 1,849 |  |  |  | 1,773 |
Operating lease right-of-use assets |  |  | 2,476 |  |  |  | 840 |
Other |  |  | 2,318 |  |  |  | 2,315 |
Other assets |  | $ | 20,954 |  |  | $ | 15,585 |
Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of the following:
|  | March 31, 2025 |  |  | December 31, 2024 |
Accrued compensation |  | $ | 3,172 |  |  | $ | 4,504 |
Taxes payable |  |  | 5,016 |  |  |  | 5,645 |
Current portion of operating lease liabilities |  |  | 1,031 |  |  |  | 698 |
Royalties payable |  |  | 4,345 |  |  |  | 3,199 |
Accrued trade payables |  |  | 12,940 |  |  |  | 14,882 |
Accrued expenses and other current liabilities |  | $ | 26,504 |  |  | $ | 28,928 |
Contract Liabilities Contract liabilities consist of deferred revenue. Deferred revenue represents billings under non-cancelable contracts before the related product or service is transferred to the customer. The portion of deferred revenue that is anticipated to be recognized as revenue during the succeeding twelve-month period is recorded as deferred revenue within the Company's condensed consolidated balance sheets. Deferred revenue was comprised of the following:
|  | Deferred Revenue |
Balance as of December 31, 2024 |  | $ | 12,056 |
Less: revenue recognized |  |  | (6,012 | )
Additions to deferred revenue |  |  | 7,419 |
Balance as of March 31, 2025 |  | $ | 13,463 |
Consolidated Statements of Operations and Comprehensive Loss Details Revenue The Company serves two customer groups: (1) Commercial Enterprise, which today consists of customers in the commercial sector, including media and entertainment customers, representation customers and Veritone Hire solutions customers (inclusive of Broadbean customers); and (2) Public Sector, which consists of customers in the public sector industries, including state, local and federal government, legal, and compliance customers. Software Products & Services consists of revenue generated from the Company’s aiWARE platform, including its Veritone Data Refinery (“VDR”) product, and Veritone Hire talent acquisition solutions, any related support and maintenance services, and any related professional services associated with the deployment and/or implementation of such solutions. Managed Services consists of revenues generated from content licensing customers, representation services, and, to a lesser extent, from advertising customers and related services. The table below illustrates the presentation of our revenues based on the above definitions:
|  | Three Months Ended |
|  | March 31, 2025 |  |  | March 31, 2024 |
|  | Commercial Enterprise |  |  | Public Sector |  |  | Total |  |  | Commercial Enterprise |  |  | Public Sector |  |  | Total |
Software Products & Services |  | $ | 13,149 |  |  | $ | 1,334 |  |  | $ | 14,483 |  |  | $ | 13,703 |  |  | $ | 1,517 |  |  | $ | 15,220 |
Managed Services: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Representation Services |  |  | 2,771 |  |  |  | — |  |  |  | 2,771 |  |  |  | 3,492 |  |  |  | — |  |  |  | 3,492 |
Licensing |  |  | 5,209 |  |  |  | — |  |  |  | 5,209 |  |  |  | 5,441 |  |  |  | — |  |  |  | 5,441 |
Total Managed Services |  |  | 7,980 |  |  |  | — |  |  |  | 7,980 |  |  |  | 8,933 |  |  |  | — |  |  |  | 8,933 |
Total revenue |  | $ | 21,129 |  |  | $ | 1,334 |  |  | $ | 22,463 |  |  | $ | 22,636 |  |  | $ | 1,517 |  |  | $ | 24,153 |
Other Expense (Income), Net The $4,061 of other income, net for the three months ended March 31, 2025 consisted of a $3,654 gain on revaluation of the Veritone One earnout receivable and a $407 foreign currency impact. The $413 of other expense, net for the three months ended March 31, 2024 consisted of a $413 foreign currency impact. Provision for Income Taxes In accordance with ASC 740-270, Income Taxes, the provision or benefit from income taxes for interim periods is determined using an estimate of the Company’s annual effective tax rate, adjusted for discrete items, if any, that are taken into account in the relevant period. Each quarter, the Company updates the estimate of the annual effective tax rate, and if the estimated tax rate changes, the Company records a cumulative adjustment. A separate estimated annual effective tax rate is applied for jurisdictions where an entity anticipates an ordinary loss or has an ordinary loss for the year to date for which no tax benefit can be recognized. The Company’s effective tax rate for the three months ended March 31, 2025 and 2024 was 1.6% and 3.8%, respectively. The difference between the effective tax rate and the U.S. federal statutory rate of 21% is primarily due to a valuation allowance established on the Company’s domestic federal and state net deferred tax assets, as well as the impact of foreign operations subject to tax in foreign jurisdictions. The change in the effective tax rates for the three months ended March 31, 2025 as compared to the comparable prior year period is primarily due to the impact of taxes on foreign operations and valuation allowances against domestic net deferred tax assets. As of March 31, 2025 and December 31, 2024, the Company had deferred tax assets of $1,849 and $1,773, respectively, and deferred tax liabilities of $5,915 and $6,387, respectively, which are included in other assets and other non-current liabilities, respectively, within the Company’s condensed consolidated balance sheets. As of March 31, 2025, the Company continues to provide a valuation allowance against deferred tax assets that are not expected to be realizable. The Company continues to evaluate the realizability of deferred tax assets and the related valuation allowance. If the Company’s assessment of the deferred tax assets or the corresponding valuation allowance were to change, the Company would record the related adjustment to income during the period in which the determination is made. The Company is subject to taxation in the United States, Israel, the United Kingdom, France, and Australia. The United States, Israel, and the United Kingdom comprise the majority of the Company’s operations. In general, the U.S. federal statute of limitations is three years. However, the Internal Revenue Service may still adjust a tax loss or credit carryover in the year the tax loss or credit carryover is utilized. As such, the Company’s U.S. federal tax returns and state tax returns are open for examination since inception. The Israeli statute of limitations period is generally four years commencing at the end of the year in which the return was filed. The Company’s subsidiary, PandoLogic, Inc., concluded their U.S. Federal audit for the 2022 tax year with no adjustment. The Company is not currently under examination from income tax authorities in the jurisdictions in which the Company does business.

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