Limelight Networks, Inc.

Good day, ladies and gentlemen. Welcome to the Limelight Network's 2021 Fourth Quarter Financial Results Conference Call. At this time, all participants are in a listen-only mode. At the end of the prepared remarks, we will provide instructions for those interested in entering the queue for questions and answers session. I will now turn the call over to Sumit Sinha, VP, Investor Relations and Corporate Development.

Good afternoon. Thank you for joining the Limelight Network's 2021 Fourth Quarter Financial Results Conference Call. This call is being recorded today, January 20th, 2022, and will be archived on our website for approximately 10 days. Let me start by quickly covering the safe harbor. We would like to remind everyone that we will be making forward-looking statements on this call. Forward-looking statements are all statements that are not strictly statements of historical fact, such as our priorities, our expectations, are operational plans, business strategies, secular trends, product and feature functionalities, pro forma results, acquisition activity, and contributions from acquired businesses. Actual results will differ materially from those contemplated by a forward-looking statement, and reported results should not be considered as an indication of feature performance. For more information, please refer to the risk factors discussed in our periodic filing, including our most recent report, Annual Form 10-K, and quarterly reports on Form 10Q. The forward-looking statements on this call are based on information available to us as of today's date, and we disclaim any obligation to update any forward-looking statements except as required by law. Joining me on the call today are Bob Lyons, our President and Chief Executive Officer, and Dan Bonsell, our EVP and CFO. Bob will start today's call with a brief discussion of the results and an update on our improve, expand, and extend initiatives. Dan will then review financial results and guidance. Following that, Bob will use the remainder of the call to discuss aspects of our strategy and corporate initiatives going forward. We will then open the call for Q&A. I will now turn the call over to Bob. Bob?

Thank you, Sumit, and welcome, everyone. In the fourth quarter, we continued to build on the momentum started in the third quarter. We had strong sequential revenue growth, gross margin, and adjusted EBITDA margin expansion. We delivered positive non-GAAP EPS and generated over $3 million in free cash flow for the quarter. Revenue came in at $62.9 million, up 14% quarter-over-quarter and year-over-year. Organic revenue growth was 7% year-over-year. Our core content delivery revenue returned to year-over-year growth for the first time in six quarters. Cash gross margin was 44.6%, up almost 500 basis points quarter over quarter and 380 basis points year over year. Adjusted EBITDA margin improved to 15% up from 11% in the third quarter. Layer 0 contributed $3.8 million in the quarter, bringing their total contribution in the year to $4.5 million in line with our guidance of $4 to $5 million for the year. And this despite the fact the deal closed three weeks later than expected. The underlying momentum of the business, supported by leading indicators, validates our strategy and demonstrates we have, in fact, achieved positive momentum in the business. The growth of our pipeline is one of those leading indicators and is much more diverse thanks to our product roadmap and technology strategy. Delivery of our edge-enabled solutions through JAMstack and the Layer Zero platform appeals to a broad range of customers, be it startups, banks, consumer product companies, or telecom. The evolution of Limelight from a media CDN focus to an edge-enabled software solutions company anchored by the high growth, high margins, app ops solutions is well underway. We have been reporting our progress using the Improve, Expand, Extend framework. As a reminder, our Improve program is focused on network performance and operating costs. Our Expand program is focused on revenue growth with existing and new clients and our extend program is focused on introducing new edge-enabled solutions that increase network utilization, growth, and gross margins. Let me highlight the progress we have made in the fourth quarter against this framework. Under our improved program, we have meaningfully improved overall network performance and have fully remediated the performance problems identified in the beginning of last year. Additionally, we continue to make operational and architectural improvements toward reducing our cost footprint. Improved highlights include As reported in our last call, third-party load balancing and data analytics firm PerpOps continues to rate Limelight's performance at number one or number two for global CDNs for the second quarter in a row. When compared to January of 2021, we have improved from not being listed in the top 20 to now being consistently ranked number one in the highly competitive North American market. This is an important proof point of the performance improvements we have and continue making to our network. December 5th was a record traffic day with traffic exceeding the previous record by 18%. December was our highest traffic month of 14% from our previous record almost a year ago. Customer confidence is back and we continue strengthening our customer relationships. We have completed our $30 million of planned annualized cost savings. Additional opportunities remain largely within the gross margin line and we will continue to pursue these to help fund our planned growth initiatives. Our client sentiment scores saw very material gains in 2021, increasing by double digits in the second half of the year across our global top 20. We continue to see sustained customer satisfaction and confidence in our improved performance and increased value as a strategic partner. Network utilization continues to be a focus given its impact on gross margin and EBITDA. We have improved overall utilization from the mid-teens in the second quarter to approaching 20% in the fourth quarter. Fittingly, our EXPAND program benefits from these operational improvements by supporting the addition of new clients and expanding existing clients. Highlights this quarter include, in the fourth quarter, we grew traffic with the two customers that had meaningfully reduced traffic in late 2020 and early 2021 due to performance concerns. We continue working with them on additional opportunities to further expand our partnership. For the third quarter in a row, 18 of our top 20 customers grew revenues by more than 20% year over year. Total bookings increased 45% quarter over quarter. We have closed many new opportunities in the fourth quarter, with more than 10 of those averaging more than $100,000 in annual contract value. We are ahead of plan to expand our growth capacity, and we continue to invest. The pipeline for both solutions, content delivery and app ops, continues to grow. For our core content business, it is the best we have seen looking back several years. The overall mix of our pipeline is also unprecedented. We continue to attract large media companies for content delivery, but with our app ops solution, we are also relevant to a variety of company sizes and types who are looking for a better solution for their high stakes web applications. These companies were out of reach with our previous strategy. On to our extend program. We have fully integrated our Layer Zero acquisition. We launched Layer Zero by Limelight in November, delivering a best-in-class, edge-enabled app ops solution designed for the outcome buyer with integrated performance, productivity, and protection. This leading solution will be further bolstered with additional security offerings to be announced in the coming weeks. A key differentiator for our Layer Zero solution is in its JAMstack roots. This next-generation architecture is gaining traction as demonstrated with two JAMstack-focused private companies funded at unicorn valuations. Our layer zero solution, coupled with our world-class global edge network and robust professional services, enables us to deliver blink of an eye speed, reduced operational costs, and a reduced attack surface for mission-critical web applications. We are seeing that outcome buyers are not just mid-market companies, but also large enterprises. Our strategic thesis has been that tool proliferation is creating complexity and confusion and edge-enabled solutions can address this complexity. We are seeing validation of this strategy across companies of all sizes and scopes. The combination of Limelight's global network and Layer Zero's edge and application solutions have quickly come together and demonstrated value. During the quarter, we had a new logo win with a large global consumer products company that owns about 100 household name brands in their product portfolio. Just two months back, we would not have been in consideration for this RFP, and today we are not only in the conversation, but more importantly, are winning and taking business from our competitors. We have many similar opportunities in our pipeline and are adding resources to accelerate our sales efforts. On the third quarter results call, we indicated that we will continue to invest in rebuilding our sales team At that time, we were tracking at about one hire a week. In the fourth quarter, that pace accelerated. We leveraged our internal network to attract others who saw the turnaround at Limelight and were excited to jump in. Our pivot from a media CDN to an edge-enabled solutions company and our best-in-class layer zero solution is resonating with people that want to be part of something unique and growth-focused. We expect to continue our pace of investments and now expect to mostly complete our hiring goals for this year by the end of Q1, a full quarter ahead of plan. There remains a lot to be done, but we continue to be energized by the progress we have made and the opportunity in front of us. The trajectory and outlook of our business, supported by measurable leading indicators, organic revenue growth, gross margin, and adjusted EBITDA progress is positive. We promised our clients, shareholders, and employees a new and improved version of Limelight, And these proof points confirm we are, in fact, demonstrating our ability to execute on that promise. At this time, I will turn the call over to Dan to report fourth quarter financials. Dan?