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Perion Makes $1.6 Million In Revenue Disappear With New Calculation Method
New revenue recognition methodology also results in what appears to be a 100+ basis point discrepancy in the ad firm’s sales growth rate.
August 2, 2023
In its latest quarterly filing Perion Networks (PERI), a provider of multi-channel digital advertising solutions, reported a 104% year-over-year (YoY) increase in connected television (CTV) revenue. The triple digit rise was due, in part, to a change in how the company recognizes CTV revenue:
“Starting this quarter, we changed our methodology for measuring our CTV activity. We moved from measuring CTV campaigns to measuring CTV channels. The CTV growth trend under both methodologies remains in the same trajectory.”
The change reduced the prior year’s second quarter CTV revenue to $3.5 million from $5.1 million.
Without the change, Perion’s second quarter 2023 YoY CTV activity would have grown just 41.1%, instead of the reported 104%.
The bigger question, in our view, is whether the change was made to accelerate the current year’s growth rate or to reduce prior period sales for some reason.
Notably, the CTV growth rate reported in the latest quarter appears to be inaccurate. Perion reported Q2 2023 CTV revenue of $7.2 million, indicating YoY growth under the new methodology is 105.7%, not 104%.
Nowhere in the release did DuDil find a routine disclosure warning numbers may not sum due to rounding.
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