UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2024

☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-40349

DoubleVerify Holdings, Inc.

(Exact name of registrant as specified in its charter)

Delaware

82-2714562

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification Number)

462 Broadway

New York, NY, 10013

(Address of Principal Executive Offices)

(212) 631-2111

(Registrant’s telephone number)

Securities registered pursuant to Section 12(b) of the Act:


Title of Each Class	Trading symbol	Name of Exchange on which registered
Common Stock, par value $0.001 per share	DV	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.




Large accelerated filer	☒	Accelerated filer	☐

Non-accelerated filer	☐	Smaller reporting company	☐	Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of July 22, 2024, there were 170,044,811 shares of the registrant’s common stock, par value $0.001 per share, outstanding.

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DoubleVerify Holdings, Inc.

Quarterly Report on Form 10-Q

For the Quarter Ended June 30, 2024

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0
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Part I FINANCIAL INFORMATION (Unaudited)

		Page

Item 1.	Condensed Consolidated Financial Statements	4

	Condensed Consolidated Balance Sheets as of June 30, 2024 and December 31, 2023	4

	Condensed Consolidated Statements of Operations and Comprehensive Income for the three and six months ended June 30, 2024 and 2023	5

	Condensed Consolidated Statements of Stockholders’ Equity for the three and six months ended June 30, 2024 and 2023	6

	Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2024 and 2023	7

	Notes to Condensed Consolidated Financial Statements	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	31

Item 4.	Controls and Procedures	31

Part II OTHER INFORMATION

Item 1.	Legal Proceedings	32

Item 1A.	Risk Factors	32

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	32

Item 3.	Defaults Upon Senior Securities	32

Item 4.	Mine Safety Disclosures	32

Item 5.	Other Information	32

Item 6.	Exhibits	33

Signatures		34

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Special Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q (“Quarterly Report”) includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical facts included in this Quarterly Report, including, without limitation, statements regarding our future financial position, business strategy, budgets, projected costs, savings and plans and objectives of management for future operations, are forward-looking statements. In addition, forward-looking statements generally can be identified by the use of forward-looking terminology such as “may,” “will,” “expect,” “intend,” “estimate,” “plan,” “anticipate,” “believe” or “continue” or the negative thereof or variations thereon or similar terminology. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we can give no assurance that such expectations will prove to have been correct.

You should read the “Special Note Regarding Forward-Looking Statements” and “Risk Factors” sections of our Annual Report on Form 10-K for the year ended December 31, 2023 and filed with the Securities and Exchange Commission (“SEC”), on February 28, 2024, for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in this report. There may be other factors not presently known to us or which we currently consider to be immaterial that may cause our actual results to differ materially from the forward-looking statements.

All forward-looking statements attributable to us or persons acting on our behalf apply only as of the date of this Quarterly Report and are expressly qualified in their entirety by the cautionary statements included in this Quarterly Report and in the Annual Report on Form 10-K for the year ended December 31, 2023. We undertake no obligation to publicly update or revise any forward-looking statements to reflect events or circumstances after the date made or to reflect the occurrence of unanticipated events.

“DoubleVerify,” “the DV Authentic Ad,” “Authentic Brand Suitability,” “DV Pinnacle” and other trademarks of ours appearing in this report are our property and we deem them particularly important to the marketing activities conducted by each of our businesses. Solely for convenience, the trademarks, service marks and trade names referred to in this report are without the ® and ™ symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights to these trademarks, service marks and trade names. This report contains additional trade names and trademarks of other companies. We do not intend our use or display of other companies’ trade names or trademarks to imply an endorsement or sponsorship of us by such companies, or any relationship with any of these companies.

Unless the context otherwise requires, the terms “DoubleVerify,” ‘‘we,’’ ‘‘us,’’ ‘‘our,’’ and the ‘‘Company,’’ as used in this report refer to DoubleVerify Holdings, Inc. and its consolidated subsidiaries.

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PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

DoubleVerify Holdings, Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)


	As of		As of
(in thousands, except per share data)	June 30, 2024		December 31, 2023
Assets:
Current assets
Cash and cash equivalents	$	256,066	$	310,131
Short-term investments		82,754		—
Trade receivables, net of allowances for doubtful accounts of $9,564 and $9,442 as of June 30, 2024 and December 31, 2023, respectively		187,761		206,941
Prepaid expenses and other current assets		32,977		15,930
Total current assets		559,558		533,002
Property, plant and equipment, net		64,521		58,020
Operating lease right-of-use assets, net		66,155		60,470
Goodwill		431,496		436,008
Intangible assets, net		125,420		140,883
Deferred tax assets		23,766		13,077
Other non-current assets		1,727		1,571
Total assets	$	1,272,643	$	1,243,031
Liabilities and Stockholders' Equity:
Current liabilities
Trade payables	$	10,604	$	12,932
Accrued expenses		44,136		44,264
Operating lease liabilities, current		10,113		9,029
Income tax liabilities		832		5,833
Current portion of finance lease obligations		2,393		2,934
Other current liabilities		11,447		8,863
Total current liabilities		79,525		83,855
Operating lease liabilities, non-current		76,265		71,563
Finance lease obligations		1,844		2,865
Deferred tax liabilities		7,031		8,119
Other non-current liabilities		2,815		2,690
Total liabilities		167,480		169,092
Commitments and contingencies (Note 15)
Stockholders’ equity
Common stock, $0.001 par value, 1,000,000 shares authorized, 172,634 shares issued and 171,244 outstanding as of June 30, 2024; 1,000,000 shares authorized, 171,168 shares issued and 171,146 outstanding as of December 31, 2023		173		171
Additional paid-in capital		926,062		878,331
Treasury stock, at cost, 1,390 shares and 22 shares as of June 30, 2024 and December 31, 2023, respectively		(25,443)		(743)
Retained earnings		213,613		198,983
Accumulated other comprehensive loss, net of income taxes		(9,242)		(2,803)
Total stockholders’ equity		1,105,163		1,073,939
Total liabilities and stockholders' equity	$	1,272,643	$	1,243,031

See accompanying Notes to unaudited Condensed Consolidated Financial Statements.

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DoubleVerify Holdings, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (UNAUDITED)


	Three Months Ended June 30,				Six Months Ended June 30,
(in thousands, except per share data)	2024		2023		2024		2023
Revenue	$	155,890	$	133,744	$	296,672	$	256,338
Cost of revenue (exclusive of depreciation and amortization shown separately below)		26,102		26,191		52,720		50,143
Product development		39,806		31,941		76,200		60,496
Sales, marketing and customer support		44,863		31,537		82,735		57,249
General and administrative		23,066		19,755		45,141		39,943
Depreciation and amortization		11,004		9,676		21,932		18,659
Income from operations		11,049		14,644		17,944		29,848
Interest expense		233		247		465		503
Other income, net		(2,064)		(2,476)		(4,336)		(5,210)
Income before income taxes		12,880		16,873		21,815		34,555
Income tax expense		5,406		4,034		7,185		9,541
Net income	$	7,474	$	12,839	$	14,630	$	25,014
Earnings per share:
Basic	$	0.04	$	0.08	$	0.09	$	0.15
Diluted	$	0.04	$	0.07	$	0.08	$	0.15
Weighted-average common stock outstanding:
Basic		171,628		166,540		171,467		166,088
Diluted		175,961		172,488		176,850		172,129
Comprehensive income:
Net income	$	7,474	$	12,839	$	14,630	$	25,014
Other comprehensive (loss) income:
Foreign currency cumulative translation adjustment		(1,814)		(377)		(6,439)		816
Total comprehensive income	$	5,660	$	12,462	$	8,191	$	25,830

See accompanying Notes to unaudited Condensed Consolidated Financial Statements.

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DoubleVerify Holdings, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (UNAUDITED)


											Accumulated
											Other
											Comprehensive
							Additional				(Loss) Income		Total
	Common Stock			Treasury Stock			Paid-in		Retained		Net of		Stockholders’
(in thousands)	Shares	Amount		Shares	Amount		Capital		Earnings		Income Taxes		Equity
Balance as of January 1, 2024	171,168	$	171	22	$	(743)	$	878,331	$	198,983	$	(2,803)	$	1,073,939
Foreign currency translation adjustment	—		—	—		—		—		—		(4,625)		(4,625)
Shares repurchased for settlement of employee tax withholdings	—		—	48		(1,792)		—		—		—		(1,792)
Stock-based compensation expense	—		—	—		—		20,718		—		—		20,718
Common stock issued upon exercise of stock options	153		—	—		—		1,695		—		—		1,695
Common stock issued upon vesting of restricted stock units	435		1	—		—		(1)		—		—		—
Treasury stock reissued upon settlement of equity awards	—		—	(38)		1,389		(1,389)		—		—		—
Net income	—		—	—		—		—		7,156		—		7,156
Balance as of March 31, 2024	171,756		172	32		(1,146)		899,354		206,139		(7,428)		1,097,091
Foreign currency translation adjustment	—		—	—		—		—		—		(1,814)		(1,814)
Shares repurchased for settlement of employee tax withholdings	—		—	30		(660)		—		—		—		(660)
Stock-based compensation expense	—		—	—		—		25,315		—		—		25,315
Common stock issued under employee purchase plan	124		—	—		—		1,914		—		—		1,914
Common stock issued upon exercise of stock options	126		—	—		—		870		—		—		870
Common stock issued upon vesting of restricted stock units	628		1	—		—		(1)		—		—		—
Shares repurchased under the Repurchase Program	—		—	1,369		(25,027)		—		—		—		(25,027)
Treasury stock reissued upon settlement of equity awards	—		—	(41)		1,390		(1,390)		—		—		—
Net income	—		—	—		—		—		7,474		—		7,474
Balance as of June 30, 2024	172,634	$	173	1,390	$	(25,443)	$	926,062	$	213,613	$	(9,242)	$	1,105,163

Balance as of January 1, 2023	165,448	$	165	31	$	(796)	$	756,299	$	127,517	$	(6,326)	$	876,859
Foreign currency translation adjustment	—		—	—		—		—		—		1,193		1,193
Shares repurchased for settlement of employee tax withholdings	—		—	30		(787)		—		—		—		(787)
Stock-based compensation expense	—		—	—		—		11,992		—		—		11,992
Common stock issued upon exercise of stock options	527		1	—		—		1,765		—		—		1,766
Common stock issued upon vesting of restricted stock units	182		—	—		—		—		—		—		—
Treasury stock reissued upon settlement of equity awards	—		—	(35)		914		(914)		—		—		—
Net income	—		—	—		—		—		12,175		—		12,175
Balance as of March 31, 2023	166,157		166	26		(669)		769,142		139,692		(5,133)		903,198
Foreign currency translation adjustment	—		—	—		—		—		—		(377)		(377)
Shares repurchased for settlement of employee tax withholdings	—		—	57		(1,966)		—		—		—		(1,966)
Stock-based compensation expense	—		—	—		—		15,399		—		—		15,399
Common stock issued under employee purchase plan	49		—	—		—		1,138		—		—		1,138
Common stock issued upon exercise of stock options	711		1	—		—		3,990		—		—		3,991
Common stock issued upon vesting of restricted stock units	333		—	—		—		—		—		—		—
Treasury stock reissued upon settlement of equity awards	—		—	(67)		2,107		(2,107)		—		—		—
Net income	—		—	—		—		—		12,839		—		12,839
Balance as of June 30, 2023	167,250	$	167	16	$	(528)	$	787,562	$	152,531	$	(5,510)	$	934,222

See accompanying Notes to unaudited Condensed Consolidated Financial Statements.

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DoubleVerify Holdings, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)


	Six Months Ended
	June 30,
(in thousands)	2024		2023
Operating activities:
Net income	$	14,630	$	25,014
Adjustments to reconcile net income to net cash provided by operating activities
Bad debt expense		1,453		3,706
Depreciation and amortization expense		21,932		18,659
Amortization of debt issuance costs		147		147
Non-cash lease expense		3,191		3,293
Deferred taxes		(11,530)		(16,639)
Stock-based compensation expense		44,956		26,980
Interest (income) expense, net		(784)		25
Loss on disposal of fixed assets		—		5
Other		1,582		209
Changes in operating assets and liabilities
Trade receivables		16,397		(12,214)
Prepaid expenses and other assets		(17,208)		(11,168)
Trade payables		(2,076)		2,126
Accrued expenses and other liabilities		(5,035)		(7,979)
Net cash provided by operating activities		67,655		32,164
Investing activities:
Purchase of property, plant and equipment		(13,558)		(7,671)
Purchase of short-term investments		(81,937)		—
Net cash used in investing activities		(95,495)		(7,671)
Financing activities:
Proceeds from revolving credit facility		—		50,000
Payments to revolving credit facility		—		(50,000)
Proceeds from common stock issued upon exercise of stock options		2,565		5,757
Proceeds from common stock issued under employee purchase plan		1,914		1,138
Finance lease payments		(1,562)		(1,028)
Shares repurchased under the Repurchase Program		(25,027)		—
Shares repurchased for settlement of employee tax withholdings		(2,452)		(2,753)
Net cash (used in) provided by financing activities		(24,562)		3,114
Effect of exchange rate changes on cash and cash equivalents and restricted cash		(850)		15
Net (decrease) increase in cash, cash equivalents, and restricted cash		(53,252)		27,622
Cash, cash equivalents, and restricted cash - Beginning of period		310,257		267,938
Cash, cash equivalents, and restricted cash - End of period	$	257,005	$	295,560

Cash and cash equivalents	$	256,066	$	295,437
Restricted cash (included in prepaid expenses and other current assets on the Condensed Consolidated Balance Sheets)		939		123
Total cash and cash equivalents and restricted cash	$	257,005	$	295,560
Supplemental cash flow information:
Cash paid for taxes	$	29,491	$	41,284
Cash paid for interest	$	350	$	389
Non-cash investing and financing activities:
Right-of-use assets obtained in exchange for new operating lease liabilities, net of impairments and tenant improvement allowances	$	9,211	$	1,261
Acquisition of equipment under finance lease	$	—	$	5,479
Capital assets financed by accounts payable and accrued expenses	$	18	$	480
Stock-based compensation included in capitalized software development costs	$	1,064	$	411

See accompanying Notes to unaudited Condensed Consolidated Financial Statements.

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DoubleVerify Holdings, Inc.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(Amounts in thousands, except per share data, unless otherwise stated)

1. Description of Business

DoubleVerify Holdings, Inc. (the “Company”) is one of the industry’s leading media effectiveness platforms that leverages artificial intelligence (“AI”) to drive superior outcomes for global brands. By creating more effective, transparent ad transactions, we make the digital advertising ecosystem stronger, safer and more secure, thereby preserving the fair value exchange between buyers and sellers of digital media. The Company’s solutions provide advertisers unbiased data analytics that enable advertisers to increase the effectiveness, quality and return on their digital advertising investments. The DV Authentic Ad is our proprietary metric of digital media quality, which measures whether a digital ad was delivered in a brand suitable environment, fully viewable, by a real person and in the intended geography. The Company’s software interface, DV Pinnacle, delivers these metrics to our customers in real time, allowing them to access critical performance data on their digital transactions. The Company’s software solutions are integrated across the entire digital advertising ecosystem, including programmatic platforms, social media channels and digital publishers. The Company’s solutions are accredited by the Media Rating Council, which allows the Company’s data to be used as a single source standard in the evaluation and measurement of digital ads.

The Company was incorporated on August 16, 2017, is registered in the state of Delaware and is the parent company of DoubleVerify Midco, Inc. (“MidCo”), which is in turn the parent company of DoubleVerify Inc. On August 18, 2017, DoubleVerify Inc. entered into an agreement and plan of merger (the “Agreement”), whereby the Company and Pixel Merger Sub, Inc. (“Merger Sub”), a wholly-owned subsidiary of the Company, agreed to provide for the merger of the Merger Sub with DoubleVerify Inc. pursuant to the terms and conditions of the Agreement.

On the effective date, Merger Sub was merged with and into DoubleVerify Inc. whereupon the separate corporate existence of Merger Sub ceased and DoubleVerify Inc. continued as the surviving corporation.

Through the merger, the Company acquired 100% of the outstanding equity instruments of DoubleVerify Inc., (the “Acquisition”) resulting in a change of control at the parent level. The merger resulted in the application of acquisition accounting under the provisions of Financial Accounting Standards Board (“FASB”) Topic Accounting Standards Codification (“ASC”) 805, “Business Combinations.”

The Company is headquartered in New York, New York and has wholly-owned subsidiaries in numerous jurisdictions, including Israel, the United Kingdom, the United Arab Emirates, Germany, Singapore, Australia, Canada, Brazil, Belgium, Mexico, France, Japan, Spain, Finland, Italy and India, and operates in one reportable segment.

2. Basis of Presentation and Summary of Significant Accounting Policies

Basis of Preparation and Principles of Consolidation

The accompanying Condensed Consolidated Balance Sheets as of June 30, 2024 and December 31, 2023, the Condensed Consolidated Statements of Operations and Comprehensive Income for the three and six months ended June 30, 2024 and 2023, the Condensed Consolidated Statements of Stockholders’ Equity for the three and six months ended June 30, 2024 and 2023, and the Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2024 and 2023 reflect all adjustments that are of a normal recurring nature and that are considered necessary for a fair presentation of the results for the periods shown in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the applicable rules and regulations of the SEC for interim financial reporting periods. Accordingly, certain information and footnote disclosures have been condensed or omitted pursuant to SEC rules that would ordinarily be required under GAAP for complete financial statements. These unaudited interim Condensed Consolidated Financial Statements should be read in conjunction with the Company’s audited consolidated financial statements and related notes included in its Annual Report on Form 10-K for the year ended December 31, 2023.

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DoubleVerify Holdings, Inc.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(Amounts in thousands, except per share data, unless otherwise stated)

Use of Estimates and Judgments in the Preparation of the Condensed Consolidated Financial Statements

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the reported amounts of revenue and expense during the reporting periods. Significant estimates and judgments are inherent in the analysis and measurement of items including, but not limited to: revenue recognition criteria including the determination of principal versus agent revenue considerations, income taxes, the valuation and recoverability of goodwill and intangible assets, the assessment of potential loss from contingencies, assumptions in valuing acquired assets and liabilities assumed in business combinations, the allowance for doubtful accounts, and assumptions used in determining the fair value of stock-based compensation. Management bases its estimates and assumptions on historical experience and on various other factors that are believed to be reasonable under the circumstances. Due to the inherent uncertainty involved in making estimates, actual results reported in future periods may be affected by changes in those estimates. These estimates are based on the information available as of the date of the Condensed Consolidated Financial Statements.

Short-term Investments

Debt Securities

The Company’s accounting for debt securities varies depending on the legal form of the security, our intended holding period for the security, and the nature of the transaction. Investments in marketable debt securities include U.S. treasury bills. The Company considers all of its marketable debt securities as available for use in current operations and, therefore, classifies these securities as Short-term investments on the Condensed Consolidated Balance Sheets. Marketable debt securities are classified as available-for-sale and are initially recorded at fair value. Unrealized gains and losses related to available-for-sale debt securities are recorded as a separate component of Other comprehensive (loss) income, net of tax on the Condensed Consolidated Statements of Operations and Comprehensive Income until realized. Interest on marketable debt securities classified as available-for-sale is included as a component of Other income, net on the Condensed Consolidated Statements of Operations and Comprehensive Income. Refer to Footnote 8, Fair Value Measurement, for further information.

The Company accounts for credit losses on available-for-sale debt securities in accordance with ASC 326, “Financial Instruments - Credit Losses” (“ASC 326”). The Company uses ASC 326 to assess the investment portfolio for impairment at the individual security level and evaluates all securities in an unrealized loss position to determine if the impairment is credit related (realized loss recorded in earnings) or non-credit related (unrealized loss).

Recently Issued Accounting Pronouncements

Segment Reporting – Improvements to Reportable Segment Disclosures

In November 2023, the FASB issued Accounting Standards Update (“ASU”) No. 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures”, which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses. The updated standard is effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted and the update requires retrospective application to all prior periods presented. The Company is currently in the process of evaluating the impact of this standard on the Company’s Condensed Consolidated Financial Statements.

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DoubleVerify Holdings, Inc.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(Amounts in thousands, except per share data, unless otherwise stated)

Income Taxes – Improvements to Income Tax Disclosures

In December 2023, the FASB issued ASU No. 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures” (“ASU 2023-09”), which expands annual disclosure requirements related to the rate reconciliation and income taxes paid disclosures. ASU 2023-09 requires consistent categories and greater disaggregation of information in the rate reconciliation and income taxes paid to be disaggregated by jurisdiction. The updated standard is effective for fiscal years beginning after December 15, 2024. Early adoption is permitted and the update may be applied on a prospective basis with retrospective application permitted. The Company is currently in the process of evaluating the impact of this standard on the Company’s Condensed Consolidated Financial Statements.

3. Revenue

The following table disaggregates revenue between advertiser customers, where revenue is generated based on the number of ads measured for Measurement or measured and purchased for Activation, and Supply-side customers, where revenue is generated based on contracts with minimum guarantees or contracts that contain overages after minimum guarantees are achieved.

Disaggregated revenue by customer type was as follows:


	Three Months Ended				Six Months Ended
	June 30,				June 30,
(in thousands)	2024		2023		2024		2023
Activation	$	87,471	$	77,942	$	166,793	$	147,834
Measurement		54,817		44,989		104,092		86,374
Supply-side customer		13,602		10,813		25,787		22,130
Total revenue	$	155,890	$	133,744	$	296,672	$	256,338

Contract assets relate to the Company’s conditional right to consideration for completed performance under the contract (e.g., unbilled receivables). Trade receivables, net of allowance for doubtful accounts, include unbilled receivable balances of $54.6 million and $55.0 million as of June 30, 2024 and December 31, 2023, respectively.

Remaining Performance Obligations

As of June 30, 2024, the Company had $16.9 million of remaining performance obligations which are expected to be recognized over the next one to three years. These non-cancelable supply-side arrangements have original expected durations longer than one year and for which the consideration is not variable. These obligations relate primarily to the Company’s supply-side revenue which represented $25.8 million, or 8.7% of the Company’s total revenue for the six months ended June 30, 2024. The vast majority of the Company’s revenue is derived primarily from our advertising customers and partners based on the volume of media transactions, or ads, that our software platform measures, and not from supply-side arrangements. In determining the remaining performance obligations, the Company applied the allowable practical expedient and did not disclose information about (1) contracts remaining performance obligations that have original expected durations of one year or less and (2) contracts for which the Company recognizes revenue at the amount to which it has the right to invoice for services performed.

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DoubleVerify Holdings, Inc.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(Amounts in thousands, except per share data, unless otherwise stated)

4. Business Combinations

Scibids Technology SAS

On August 14, 2023, the Company acquired all of the outstanding stock of Scibids Technology SAS (“Scibids”), a global leader in AI technology for digital campaign optimization. The acquisition combines DoubleVerify’s proprietary data with Scibids’ AI-powered optimization technology to provide advertiser customers with enhanced insights and control over their advertising performance.

The total purchase price of $121.1 million, net of cash acquired, includes measurement period adjustments of $0.3 million recorded during the three months ended June 30, 2024. The effect of these adjustments on the preliminary purchase price allocation was a decrease to the purchase consideration of $0.3 million and a corresponding decrease recorded to Goodwill on the Condensed Consolidated Balance Sheets.

The preliminary allocations of the purchase price for Scibids are subject to revisions as additional information is obtained about the facts and circumstances that existed as of the acquisition date. The revisions may have a significant impact on the accompanying Condensed Consolidated Financial Statements. The allocations of the purchase price will be finalized once all information is obtained and assessed, not to exceed one year from the acquisition date. As of June 30, 2024, the purchase price allocation for Scibids is subject to the finalization of working capital adjustments.

5. Goodwill and Intangible Assets

The following is a summary of changes to the goodwill carrying value from December 31, 2023 to June 30, 2024:


(in thousands)
Goodwill at December 31, 2023	$	436,008
Measurement period adjustments		(300)
Foreign exchange impact		(4,212)
Goodwill at June 30, 2024	$	431,496

The following table summarizes the Company’s intangible assets and related accumulated amortization:


(in thousands)	June 30, 2024						December 31, 2023
	Gross Carrying		Accumulated		Net Carrying		Gross Carrying		Accumulated		Net Carrying
	Amount		Amortization		Amount		Amount		Amortization		Amount
Trademarks and brands	$	11,733	$	(5,561)	$	6,172	$	11,734	$	(5,140)	$	6,594
Customer relationships		160,520		(69,985)		90,535		161,173		(62,955)		98,218
Developed technology		92,243		(63,530)		28,713		93,013		(56,942)		36,071
Non-compete agreements		64		(64)		—		66		(66)		—
Total intangible assets	$	264,560	$	(139,140)	$	125,420	$	265,986	$	(125,103)	$	140,883

Amortization expense related to intangible assets for the three months ended June 30, 2024 and June 30, 2023 was $7.1 million and $6.4 million, respectively. Amortization expense related to intangible assets amounted to $14.4 million and $12.6 million for the six months ended June 30, 2024 and June 30, 2023, respectively.

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DoubleVerify Holdings, Inc.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(Amounts in thousands, except per share data, unless otherwise stated)

Estimated future expected amortization expense of intangible assets as of June 30, 2024 is as follows:


(in thousands)
2024 (for remaining six months)	$	14,247
2025		26,702
2026		21,948
2027		18,045
2028		14,913
2029		12,562
Thereafter		17,003
Total	$	125,420

The weighted-average remaining useful life by major asset classes as of June 30, 2024 is as follows:


		(In years)
Trademarks and brands		8
Customer relationships		6
Developed technology		2

There were no impairments of Goodwill or Intangible assets identified during the six months ended June 30, 2024 and June 30, 2023.

6. Property, Plant and Equipment

Property, plant and equipment, including equipment under finance lease obligations and capitalized software development costs, consisted of the following:


	As of
(in thousands)	June 30, 2024		December 31, 2023
Computers and peripheral equipment	$	26,360	$	25,013
Office furniture and equipment		3,554		3,170
Leasehold improvements		34,766		32,595
Capitalized software development costs		44,865		35,039
Less accumulated depreciation and amortization		(45,024)		(37,797)
Total property, plant and equipment, net	$	64,521	$	58,020

For the three months ended June 30, 2024 and June 30, 2023, total depreciation expense was $3.9 million and $3.3 million, respectively. For the six months ended June 30, 2024 and June 30, 2023, total depreciation expense was $7.5 million and $6.1 million, respectively.

Property and equipment under finance lease obligations, consisting of computer equipment, totaled $17.8 million as of June 30, 2024 and December 31, 2023, respectively. As of June 30, 2024 and December 31, 2023, accumulated depreciation related to property and equipment under finance lease obligations totaled $14.0 million and $12.9 million, respectively. Refer to Note 7, Leases.

There were no impairments of Property, plant and equipment identified during the six months ended June 30, 2024 and June 30, 2023.

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DoubleVerify Holdings, Inc.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(Amounts in thousands, except per share data, unless otherwise stated)

7. Leases

The following table presents lease cost and cash paid for amounts included in the measurement of lease liabilities for finance and operating leases for the three and six months ended June 30, 2024 and 2023, respectively.


	Three Months Ended June 30,				Six Months Ended June 30,
(in thousands)	2024		2023		2024		2023
Lease cost:
Operating lease cost (1)	$	2,690	$	2,582	$	5,327	$	5,169
Finance lease cost:
Depreciation of finance lease assets (2)		493		314		1,112		531
Interest on finance lease liabilities (3)		57		43		121		66
Short-term lease cost (1)		327		243		644		489
Sublease income (1)		—		(267)		—		(534)
Total lease cost	$	3,567	$	2,915	$	7,204	$	5,721

Other information:
Cash paid for amounts included in the measurement of lease liabilities
Operating cash outflows from operating leases	$	2,522	$	1,516	$	5,038	$	2,852
Operating cash outflows from finance leases	$	81	$	17	$	155	$	40
Financing cash outflows from finance leases	$	747	$	515	$	1,562