Marin Software, an AdTech firm offering a suite of solutions for advertising, reported its third quarter’s (Q3 2022) financial performance. The firm achieved a net revenue of USD 5 million (19% YoY dip) for Q3 2022, in line with the upper bound of the firm's guidance. Marin Software’s stock price fell 17% subsequent to the release of its latest earnings. 

The firm’s losses widened during the quarter, and it recorded a GAAP operating loss of USD 5.8 million (compared with a loss of USD 3.3 million in Q3 2021), which exceeded the upper bound of management guidance by 18%. This was primarily due to a rise in R&D and administrative costs, which resulted in a 22% YoY rise in total operating expenses during the quarter.  

The firm provided guidance for Q4 2022E; it expects to achieve net revenue between USD 4.6 million and USD 5.1 million and a non-GAAP operating loss between USD 4.5 million and USD 4.9 million.

The firm also stated that, during the quarter, it launched 1) support services for a number of social media functions including Snapchat Ads, Pinterest bidding, and Google Smart bidding, 2) one-click support for nearly 20 insights, and 3) a number of new features to enhance customer insights and segmentation.

Analyst QuickTake: While management has slightly revised its revenue guidance upward for 4Q 2022 compared with the previous quarter , the firm has continued to maintain the same guidance with respect to its operating losses, which it expects to continue. This is an acknowledgment of the fact that the firm is likely to continue to underperform due to operational weaknesses in its revenue model.