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Career Coach Office Hours: November 12 2024
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I answered questions about #jobsearch. If you can't attend live, mark that you'll attend on LinkedIn, message your question to me there, and watch the replay
07:01 Why doesn't HR reply after I complete the job application?
08:45 What are some effective strategies for negotiating a higher salary when starting a new job?
11:20 If a person has two job interviews scheduled for the same day, should
...
they go ahead with both interviews or cancel one of them?
If a person has two job interviews scheduled for the same day, should they go ahead with both interviews or cancel one of them?
12:45 A commercial
14:48 Does not showing up to interviews affect hiring process at other places?
16:57 What are some things to say to explain a job search gap on a resume or during an interview?
19:07 Is it good when a company closes a job requisition, just before sending you the interview invite?
19:41 Does not showing up to interviews affect hiring process at other places?
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Top Job Interview Mistakes That Can Cost You The Job
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Your resume worked and got you a highly coveted job interview. You're a strong candidate, excited and hopeful. Then to your ultimate disappointment, you don't get a job offer. Sarah found herself in this situation.
She was a sales manager who had recently lost her job. Frustrated by her lack of success, she called for interview coaching. Sarah began our conversation by saying, "I'm in sales, but
...
it seems I can't sell myself. I must be making a major mistake because I'm not being hired. I have all the job qualifications, so I can't figure out what I'm doing wrong. I've lost out on three jobs now, so I'm doing something to turn off the employers. What can it be?"
Many others also face this scenario. They don't know what they might be saying that prevents them from not getting hired. As I began my interview coaching session with Sarah, it became crystal clear that there were some significant mistakes she needed to correct to change the outcome to land the next job.
You need to avoid making the following mistakes.
When you are under the spotlight, people often give a poor answer that sends the message to the employer that you are the wrong person for the job. You don't want to get tripped up by these typical but difficult questions. Advanced preparation is the key to handling them like a pro and building the employer's confidence in your job performance.
List the questions you'll likely be asked and write your answers. Are you saying something that can make them question whether you might have problems with the work or interacting with others? When you are happy with the response, practice recording yourself answering each one. Listen to the playback. Refine the answer until you are satisfied with how you'll respond.
Prepare answers to questions like:
All job hunters seem to cringe when they hear this weakness question. Yes, this is a super tough one. My Forbes article, "A New Way To Answer The 'What's Your Greatest Weakness?' Interview Question" will guide you in developing the perfect answer.
This probing style of questioning is how most candidates make mistakes. It's designed so the employer can assess how you have performed in the past and also assume you'll do the same if you work for them. Your answers are very revealing and help the employer make a better, unbiased decision.
Job hunters find situational questions challenging to answer. They skip early details that make the story harder to follow. They fail to paint a clear picture of the situation, leaving out specific details and critical information. This confuses the hiring manager, who gets stuck wondering where this happened or who was involved. By not being detailed and specific upfront the employer often doesn't catch the rest of your answer.
As you craft your answer, begin the story defining where this happened. For example, "While I was the Director at Mount Vernon Health," then name and explain who the players are, clearly noting the problem or issue. You would continue saying, "My project manager, Mary, made a costly mistake on the project budget." Next, show what you did and how you resolved the problem. These upfront details are precise and allow the listener to comprehend your actions. Your work stories should be concise and last no more than 60 seconds.
For examples of creating effective answers to situational questions, read my Forbes article "Ace Your Next Interview Using the STAR Method."
Don't assume the employer has read your resume thoroughly and carefully when you begin the interview. Many times, they just skim it. As important as this meeting is to you, the employer often shows up distracted, preoccupied, and not paying complete attention at the start. They could be thinking about other work that needs to be done, an employee problem, the last candidate they met, family issues, etc.
In order to grab their attention in those first two minutes, you need a powerful opening to the "tell us about yourself" request. You quickly achieve that goal by using a technique I call the 60 Second Sell. This strategic elevator pitch highlights your top skills, accomplishments, and credentials demonstrating how you would excel performing their job.
Customize your answer to address the employer's needs. Identify your top five top selling points, link them together in a couple of sentences, and you have your 60 Second Sell. This response will get the interview off to a flying start. For a few examples, read my Forbes article "Best Way to Open An Interview To Secure A Job Offer."
When the employer has finished answering all their questions, and you have asked yours, most job hunters say goodbye. That's a missed opportunity to sell yourself. Assume that the employer may only recall a little about you. We want your top accomplishments, skills, and strengths to be at the forefront of their mind with a fine-tuned closing that ensures that you are perfect for the job.
To conclude say, "Thank you for the opportunity to learn about your position. I'm very interested in this job. In closing, let me summarize what I bring to the position," and continue making your four or five key points. Then say goodbye. After you leave, the employer fills out a form evaluating the candidate. The last thing they heard were the top reasons to hire you.
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How to Write a Cover Letter That Will Get You a Job
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By Alison Green, the Cut's workplace-advice columnist who has run her own career-advice website, Ask a Manager, for 15 years. Green is the author of Ask a Manager: How to Navigate Clueless Colleagues, Lunch-Stealing Bosses, and the Rest of Your Life at Work and Managing to Change the World: The Nonprofit Manager's Guide to Getting Results.
Over the course of my career, I've read probably tens of
...
thousands of cover letters. (And yes, that's as boring as it sounds.) In doing so, what I've learned is that most job applicants' cover letters are truly awful -- and as a result, if you're willing to put in the time to write a good one, you can stand out from your competition in a really effective way.
A great cover letter won't get you the job if you're not qualified, but it can make a hiring manager notice you in a sea of applicants and encourage them to interview you when you otherwise might have been overlooked. In fact, a good cover letter can be such an effective way of boosting your application that I'm always amazed by how many candidates don't bother to take advantage of the opportunity they offer.
The whole point of including a cover letter -- and the whole reason employers ask for them -- is that you're more than just your job history. Your experience is a huge part of what will interest employers, of course, but that doesn't tell the whole story; hiring managers are also looking for candidates who communicate well, show good judgment, are easy to work with, and all the other things you'd want from your own co-workers. When written well, cover letters can give more of a window on those things than a résumé alone. They can also fill in any blanks and provide context on your candidacy -- for example, explaining why you're interested in this particular job (especially if it doesn't at first glance look like a natural next step for you).
Without question, the biggest mistake people make with cover letters is using them to restate their résumé; no other mistake even comes close to this one in frequency or impact.
Hiring managers don't need a summary of your résumé! They're going to see your work history and relevant experience on the very next page. And when you consider that your entire application is only a few pages total (a one- or two-page résumé and a one-page cover letter), it makes no sense to squander space by repeating yourself.
Instead, your cover letter should go beyond your work history to talk about things that make you especially well-suited for the job. For example, if you're applying for an assistant job that requires being highly organized and you neurotically track your household finances in a multi-tab, color-coded spreadsheet, most hiring managers would love to know that because it says something about the kind of attention to detail you'd bring to the job. That's not something you could put on your résumé, but it can go in your cover letter.
Or maybe your last boss told you that you were the most accurate data processor she'd ever seen, or came to rely on you as her go-to person whenever a lightning-fast rewrite was needed. Maybe your co-workers called you "the client whisperer" because of your skill in calming worried clients. Maybe you're regularly sought out by more senior staff to help problem-solve, or you find immense satisfaction in bringing order to chaos. Those sorts of details illustrate what you bring to the job in a different way than your résumé does, and they belong in your cover letter.
If you're still stumped, pretend you're writing an email to a friend about why you'd be great at the job. You probably wouldn't do that by stiffly reciting your work history, right? You'd talk about what you're good at and how you'd approach the work. That's what you want here.
3.
You don't need a creative opening line.
If you think you need to open the letter with something creative or catchy, I am here to tell you that you don't. Just be simple and straightforward:
That's it! Straightforward is fine -- better, even, if the alternative is sounding like an aggressive salesperson.
4.
No, you don't need to hunt down the hiring manager's name either.
If you read much job-search advice, at some point you'll come across the idea that you need to do Woodward and Bernstein-level research to hunt down the hiring manager's name in order to open your letter with "Dear Matilda Jones." You don't need to do this; no reasonable hiring manager will care. If the name is easily available, by all means, feel free to use it, but otherwise "Dear Hiring Manager" is absolutely fine. Take the hour you just freed up and do something more enjoyable with it.
5.
Show, don't tell.
A lot of cover letters assert that the person who wrote it would excel at the job or announce that the applicant is a skillful engineer or a great communicator or all sorts of other subjective superlatives. That's wasted space -- the hiring manager has no reason to believe it, and so many candidates claim those things about themselves that most managers ignore that sort of self-assessment entirely. So instead of simply declaring that you're great at X (whatever X is), your letter should demonstrate that. And the way you do that is by describing accomplishments and experiences that illustrate it.
Here's a concrete example taken from one extraordinarily effective cover-letter makeover that I saw. The candidate had originally written:
"I offer exceptional attention to detail, highly developed communication skills, and a talent for managing complex projects with a demonstrated ability to prioritize and multitask."
That's pretty boring and not especially convincing, right? (This is also exactly how most people's cover letters read.) In her revised version, she wrote this instead:
"In addition to being flexible and responsive, I'm also a fanatic for details -- particularly when it comes to presentation. One of my recent projects involved coordinating a 200-page grant proposal: I proofed and edited the narratives provided by the division head, formatted spreadsheets, and generally made sure that every line was letter-perfect and that the entire finished product conformed to the specific guidelines of the RFP. (The result? A five-year, $1.5 million grant award.) I believe in applying this same level of attention to detail to tasks as visible as prepping the materials for a top-level meeting and as mundane as making sure the copier never runs out of paper."
That second version is so much more compelling and interesting -- and makes me believe that she really is great with details.
6.
If there's anything unusual or confusing about your candidacy, address it in the letter.
Your cover letter is your chance to provide context for things that otherwise might seem confusing or less than ideal to a hiring manager. For example, if you're overqualified for the position but are excited about it anyway, or if you don't have the exact experience the ad requested but can point to other evidence that you would excel at the job, explain that. Similarly, if your background is in a different field but you're actively working to move into this one, say so, talk about why, and explain how your experience will translate. Or if you're applying for a job across the country from where you live because you're hoping to relocate to be closer to your family, let them know that.
If you don't provide that kind of context, it's too easy for a hiring manager to write you off as the wrong fit or assume you're just applying to everything you see or don't understand the job description and put you in the "no" pile. A cover letter gives you a chance to say, "No, wait -- here's why this could be a good match."
7.
Keep the tone warm and conversational.
While there are some industries that prize formal-sounding cover letters -- like law -- in most fields, yours will stand out if it's warm and conversational. Aim for the tone you'd use if you were writing to a co-worker whom you liked a lot but didn't know especially well. It's okay to show some personality or even use humor; as long as you don't go overboard, your letter will be stronger for it.
8.
Don't use one generic letter for all applications.
It's tempting to use the same canned letter for every job -- it certainly saves a lot of time. But by doing that, you're squandering much of the value a cover letter can provide. You'll miss the chance to speak to the specifics of what each employer is looking for, not to mention your application is highly likely to feel like a form letter (because it is).
That doesn't mean you need to write every cover letter completely from scratch; you don't. You'll often be able to reuse whole chunks of language from one letter to the next. Just don't blindly upload the same letter each time without customizing it at least a bit to each individual job.
A good litmus test is this: Could you imagine other applicants for this job sending in the same letter? If so, that's a sign that you haven't made it individualized enough to you and are probably leaning too heavily on reciting your work history.
9.
Keep it under one page.
If your cover letters are longer than a page, you're writing too much, and you risk annoying hiring managers who are likely sifting through hundreds of applications and don't have time to read lengthy tomes. On the other hand, if you only write one paragraph, it's unlikely that you're making a compelling case for yourself as a candidate -- not impossible, but unlikely. For most people, something close to a page (single-spaced) is about right.
10.
Don't agonize over the small details.
What matters most about your cover letter is its content. You should of course ensure that it's well-written and thoroughly proofread, but many job seekers agonize over elements of the letter that really don't matter. I get tons of questions from job seekers about whether they should attach their cover letter or put it in the body of the email (answer: No one cares, but attaching it makes it easier to share and will preserve your formatting), or what to name the file (again, no one really cares as long as it's reasonably professional, but when people are dealing with hundreds of files named "resume," it's courteous to name it with your full name).
Approaching your cover letter like this can make a huge difference in your job search. It can be the thing that moves your application from the "maybe" pile (or even the "no" pile) to the "yes" pile. Of course, writing cover letters like this will take more time than sending out the same templated letter summarizing your résumé -- but 10 personalized, compelling cover letters are likely to land you more interview invitations than 50 generic ones will.
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AI Yi Yi! -- AI Ethics, Part 2
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You know the kind of day I'm talking about. Big job interview coming up, girlfriend sick, so I spend the night tossing and turning on the couch. Wake up with a neck so stiff I can barely move, only to smash my head on the car door frame because bending over far enough to get in is currently beyond me. Spring allergies? Check. No AC in my old Maverick? Double check. Stuck in crosstown traffic,
...
sweating like I've been trapped in a Texas summer my whole life? You know it, guy. By the time I park, I'm half a step away from unraveling.
You know the kind of interview I'm talking about. I want to sound confident without displaying overt desperation, so my answers bounce between watered-down versions of what I'd like to say and whatever I think the two people across from me -- the managing editor and her assistant -- want to hear. Spoiler: It isn't going great. I'm too obviously hedging every response, walking the tightrope between "actual hireable professional" and "volunteering to sacrifice myself on the altar of capitalism," all for the promise of enough money to scrape by at a job that I can finally say uses my English degree.
Then, it happens.
At the end of my desultory interview, the managing editor leans forward and says, "You know, apart from everything else we've talked about, I just have to...
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'Preparation is key'
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With 30 years of experience in management roles and extensive expertise in managing people, Robert Cassar, founder at Heroix, brings a wealth of knowledge to the table.
Over the years, Robert has helped countless professionals in finding roles that align with their needs, values and career aspirations. Moreover, he has acted as a mentor, lecturer and thesis supervisor - which experiences all
...
enrich his capacity to guide candidates through their career journeys. His insights are invaluable for anyone looking to excel in their career journey, particularly at the executive level.
What would you say are some of the key questions candidates sitting for a job interview at an executive level, should be prepared for?
When it comes to interviews for mid- to senior-level positions, candidates should be ready to answer a range of questions that assess their leadership abilities, strategic thinking, and adaptability. The key in such scenarios is to always find genuine cases in one's experience which can be linked to these situations and refer to them as an example as to how they had tackled such situations in real life.
This enhances the candidate's potential to interview success twofold. On one hand it shows that what was written on the CV is genuine, there is experience behind it. On the interviewer's side, the interviewer can ask secondary questions to continue expanding on such examples and therefore continue to deduce that the experience mentioned is sincere. On the other hand, such anecdotes will assist the interviewer to remember the individual. Case examples give the interviewer a good mental picture of the interviewee.
Statistics show that job mobility increased in recent years. Are more people willing to change careers in Malta?
Job mobility has indeed increased. And this is not a Malta-only phenomena. The evolving nature of work, driven by technological advancements and changing market dynamics, the pandemic and its repercussions has led many professionals to seek new opportunities or move to totally new career paths. You get practising medical doctors wanting to move to senior roles in commercial entities, banking executives leaving their risk averseness and looking to move into C Suite asking specifically for a start-up environment, people with a strong accounting background wanting to merge their expertise with ESG eyeing the upcoming demand for high profile roles in this sector.
Has this made it more difficult for organisations to retain talent?
Yes, this is indeed a challenge. We get introduced on a daily basis with new business customers who would be willing to engage more headcount for further growth for their setup, but are held back due to the challenge of finding and retaining the right talent. Increased job mobility has been making talent retention challenging for organisations. This has assisted companies to continue to invest more in employee engagement, career development opportunities, and competitive compensation packages to retain top talent.
When people decide to change jobs or careers, is a more attractive pay package the most determining factor?
While a more attractive pay package is always an important factor, it is not the only one. Many professionals also seek better work-life balance, opportunities for career advancement, and a positive company culture. Factors like job satisfaction, personal development opportunities, and alignment with personal values and goals play crucial roles in the decision to change jobs or careers.
What makes for an effective CV that stands out from the rest?
An effective CV should be clear, concise, and, especially for senior roles, tailored to the specific job. It should highlight key achievements and skills relevant to the position, rather than just listing job duties. Including quantifiable results, such as "increased sales by 20%" or "reduced costs by 15%", and expanding on those, can make a CV stand out, as these can be talking points for the interview. Additionally, a professional layout, free of errors, and including a compelling summary or objective can significantly enhance its impact.
For candidates presenting themselves for a job interview, how should they prepare themselves?
Preparation is crucial. Candidates should research the company thoroughly, understand its culture, recent achievements, and challenges. As said, candidates should prepare examples from their past experience that demonstrate their skills and achievements. Additionally, understanding the job description and aligning their skills and experiences with the job requirements is key.
Finally, though it sounds obvious, get into the 'logistics' of the interview in detail. Be sure if it's online or on premises, be sure of the time; if online, check the link, that one has the latest working version of the communication platform to be used. Nothing creates stress more than clicking on the Zoom link two minutes before the interview and the platform requires updating. On the other hand, if meeting on location, be sure of the exact location, who to ask for, where to park. Go through the company's website and their social media presence, see how people dress at work - this will give you a clue of how to show yourself. Unconsciously or not, whoever will be interviewing will want to see someone who can integrate well and happily to the culture, and this includes dress. Now for the interview, dress a notch up in formality, to that found in the search, after all you're going in for an interview and not the regular day at work. The appearance point is especially critical for people-facing roles such as commercial roles. When interviewing for such roles I always keep attentive on how the individual walks into the meeting room, how they're dressed, their greeting and overall 'room vibe'.
In what ways does your presence on the Jobhound platform add value to Heroix's service offering?
Being on Jobhound via Times of Malta website enhances our service offering by providing us with a channel frequently visited by executives. It allows us to present job opportunities that align with the skills and career aspirations of many seeking new career paths and roles.
How does Heroix support executive candidates in their search?
At Heroix, we focus on a personalised approach to candidate support. We aim to understand candidates' career goals, values, and motivations. This allows us to highlight roles they might not have considered but which align with their expertise and potential career trajectory. We also provide feedback on their CVs and support in interview preparations. Our aim is to help candidates find positions that not only match their skills but also resonate with their personal and professional aspirations.
Our goal is that a candidate's move is for the long term, so that they establish themselves in the new role and grow in their expertise. This not only brings added benefits to their career prospects but also more stability in their personal life as while they establish themselves in their role, they become more satisfied, more motivated and this has a positive effect on their life outside work, on their personal projects and the important people in their personal life.
What strategies do you employ to ensure candidates find companies that align with their values and passions?
We employ different approaches to understand candidates' values and passions. Our experience in mentoring and coaching assist us to help candidates to identify their core motivations and long-term career goals. We then leverage our network and industry knowledge to connect them with companies that share similar values and offer the right cultural fit. By aligning candidates with organisations that reflect their personal and professional ethos, we help them achieve greater job satisfaction and long-term career success.
How does understanding a candidate's potential career trajectory benefit their job search?
The default one might fall into, erroneously, both from a potential employer's side and from a potential employee's side, is to 'just' look into the past. The adage 'the past is not a guarantee for the future' fits here too. Looking at past achievements both academic and secular, needless to say, is an important factor in evaluating a candidate's potential. But it's far from enough. Especially in 2024 and beyond.
How will people be preparing their marketing campaigns in 2026? Managing a team in 2025? Same as in 2016 or 2015? Things are changing exponentially. What worked 10 years ago, albeit one dare say even 4 years ago, pre-pandemic, may well not be today's standard or that of next year. Therefore, understanding a candidate's potential career trajectory allows us to provide tailored advice and highlight opportunities that align with their future goals and the future of work.
By focusing on where a candidate can go, rather than just where they have been, we can identify roles that offer growth and advancement, ensuring they continue to develop professionally while assisting organisations to have a better edge than competition in the market.
To explore the executive vacancies presented by Heroix, visit https://jobhound.mt/b/heroix.
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Veritone Reports Third Quarter 2024 Results - Veritone (NASDAQ:VERI)
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- Q3 Revenue of $22.0 million, in line with our previous preliminary estimates -
- Q3 Software and Managed Services Revenue of $14.7 and $7.3 million -
- ARR of $63.3 million from 3,291 Total Software Products & Services Customers, including $48.3 million or 76% from subscription-based customers demonstrating diversified & stable revenue streams -
- Completed restructuring through Q3 resulting
...
in forecasted annualized savings of over 15% in operating expense from FY 2023 accelerating expected profitability into fiscal 2025 -
- Completed divestiture of media agency in October 2024 for total consideration of up to $104 million, including $59.1 million of cash at closing and up to $18 million in earnout subject to the media agency's revenue performance in calendar year 2025. Net proceeds used to paydown $30.5 million in term debt -
- Announced fiscal 2025 business outlook with up to 30% year over year forecasted revenue growth and over 45% forecasted improvement in Non-GAAP Net Loss as compared to fiscal 2024 guidance led by over $100 million in sales pipeline at Q3 2024 -
Veritone, Inc. VERI, a leader in designing human-centered AI solutions, today reported results for the third quarter ended September 30, 2024.
"The divestiture of Veritone One marks a defining moment in our company's evolution, positioning us as a pure-play enterprise AI company at a pivotal time in the technology landscape," said Ryan Steelberg, Chief Executive Officer of Veritone. "With over 3,000 existing customers across Commercial and Public Sectors, we're now poised to capitalize on the unprecedented growth in the AI solutions market. As we look toward 2025, we're energized by our streamlined operational focus and enhanced ability to invest in innovation that will truly differentiate Veritone in the enterprise AI marketplace."
Third Quarter 2024 Financial Highlights
Revenue of $22.0 million, a decrease of 21% compared to Q3 2023. Software Products and Services revenues of $14.7 million, a decrease of 28% compared to $20.4 million in Q3 2023 driven by expected declines in consumption- based revenue customers, including Amazon and declines in one-time non-recurring software revenue. Managed Services revenue of $7.3 million as compared to $7.6 million in Q3 2023. Total Software Products & Services Customers of 3,291, down 7% year over year, as compared to September 30, 2023, largely driven by Commercial Enterprise, which began sunsetting legacy Career Builder customers following the June 2023 acquisition of Broadbean, offset by an increase across Public Sector from growth in public safety customers. Total New Bookings of $16.5 million, up 17% sequentially from Q2 2024 and 6% year over year, as compared to Q3 2023. Annual Recurring Revenue ("ARR") (as defined below) of $63.3 million, down from $89.3 million in Q3 2023 driven by declines in consumption-based revenue, including Amazon, offset by a slight increase from recurring subscription-based SaaS revenue customers. Net loss from Continuing Operations of $22.5 million, as compared to a loss of $26.7 million in Q3 2023 driven by lower overall operating expenses resulting from our past cost reduction plans and offset by decline in revenue. Non-GAAP gross profit of $15.7 million, a decrease of 25% or $5.3 million as compared to Q3 2023 primarily due to the decline in revenue. Non-GAAP gross margins of 71.2% as compared to 74.9% in Q3 2023. Net Loss of $21.7 million, as compared to $24.5 million in Q3 2023. Non-GAAP Net Loss of $7.1 million, which was relatively flat as compared to Q3 2023.
Divestiture of Veritone One, LLC
Through October 17, 2024 (the "Divestiture Closing Date"), we operated Veritone One, LLC ("Veritone One"), a full-service advertising agency, to provide differentiated Managed Services to our customers. On October 17, 2024, we sold all of the issued and outstanding equity of Veritone One to an affiliate of Insignia Capital Group L.P. (such transaction, the "Divestiture"). Veritone One's services include media planning and strategy, advertisement buying and placement, campaign messaging, clearance verification and attribution, and custom analytics, specializing in host-endorsed and influencer advertising across primarily radio, podcasting, streaming audio, social media and other digital media channels. We determined that the Divestiture represents a strategic shift that will have a material effect on our operations and financial results. Therefore, the historical financial results of Veritone One are reflected in this earnings release as discontinued operations and, as such, have been excluded from continuing operations for all periods presented on a retrospective basis, unless otherwise stated.
About Our Sales Pipeline
Our sales pipeline represents revenue we expect to receive based on the total fees payable during the full contract term for new contracts outstanding at the end of the quarter and contracts that we believe have a high probability of closing in the next three to twelve months. We include in our sales pipeline fees payable during any cancellable portion and an estimate of license fees that may fluctuate over the term and we do not include any variable fees under the contract (e.g., fees for cognitive processing, storage, professional services and other variable services) and any fees payable after contract renewals or extensions that are at the discretion of our customer. Many of our contracts require us to provide services over more than one year and may include professional fees required to enable our technology in certain environments we do not host or have direct control over. In some cases, our customers may have the ability to terminate our agreements on short notice and our pipeline does not consider the potential impact of any early termination. No assurance can be given that we will ultimately realize our full sales pipeline.
Three Months Ended
September 30,
Nine Months Ended
September 30,
Unaudited
Percent
Percent
(in $000s)
2024
2023
Change
2024
2023
Change
Revenue
$
21,993
$
27,968
(21
)%
$
70,204
$
72,883
(4
)%
Loss from operations
$
(22,492
)
$
(25,183
)
11
%
$
(67,167
)
$
(79,773
)
16
%
Net loss from continuing operations
$
(22,511
)
$
(26,732
)
16
%
$
(72,072
)
$
(76,012
)
5
%
Net loss
$
(21,746
)
$
(24,541
)
11
%
$
(69,175
)
$
(70,800
)
2
%
Non-GAAP gross profit*
$
15,668
$
20,942
(25
)%
$
50,590
$
51,502
(2
)%
Non-GAAP net loss from continuing operations*
$
(11,097
)
$
(10,411
)
(7
)%
$
(31,139
)
$
(36,833
)
15
%
Non-GAAP net loss*
$
(7,113
)
$
(7,943
)
10
%
$
(21,579
)
$
(30,523
)
29
%
Three Months Ended
September 30,
Nine Months Ended
September 30,
Unaudited
Percent
Percent
(in $000s, except customers)
2024
2023(1)
Change
2024
2023(1)
Change
Software Products & Services
Software Revenue*
$
14,694
$
20,361
(28
)%
$
45,549
$
63,643
(28
)%
Total Software Products & Services Customers(2)
3,291
3,536
(7
)%
3,291
3,536
(7
)%
Annual Recurring Revenue(3)*
$
63,280
$
89,299
(29
)%
$
63,280
$
89,299
(29
)%
Total New Bookings(4)
$
16,471
$
15,501
6
%
$
16,471
$
15,501
6
%
Gross Revenue Retention(5)
>90%
>90%
>90%
>90%
(1)All of the supplemental financial information for the nine months ended September 30, 2023 reflects the historical information of Veritone combined with the historical information of Broadbean (as defined below) as if Veritone had acquired Broadbean on January 1, 2022. Veritone completed its acquisition of (i) all of the issued and outstanding share capital of (a) Broadbean Technology Pty Ltd ACN 116 011 959 / ABN 79 116 011 959, a limited company incorporated under the laws of Australia, (b) Broadbean Technology Limited, a limited company incorporated under the laws of England and Wales, (c) Broadbean, Inc., a Delaware corporation and (d) CareerBuilder France S.A.R.L., a limited liability company organized (société à responsabilité limitée) under the laws of France, and (ii) certain assets and liabilities related thereto (the foregoing clauses (i) and (ii) together, "Broadbean") on June 13, 2023.
(2)"Total Software Products & Services Customers" includes Software Products & Services customers as of the end of each respective quarter set forth above with net revenues in excess of $10 and also excludes any customers categorized by us as trial or pilot status. In prior periods, we provided "Ending Software Customers," which represented Software Products & Services customers as of the end of each fiscal quarter with trailing twelve-month revenues in excess of $2,400 for both Veritone, Inc. and PandoLogic Ltd. and/or deemed by Veritone to be under an active contract for the applicable periods. Total Software Products & Services Customers is not comparable to Ending Software Customers. Total Software Products & Services Customers includes customers based on revenues in the last month of the quarter rather than on a trailing twelve month basis and excludes any customers that are on trial or pilot status with us rather than including customers with active contracts. Management uses Total Software Products & Services Customers and we believe Total Software Products & Services Customers are useful to investors because it more accurately reflects our total customers for our Software Products & Services inclusive of Broadbean.
(3) "Annual Recurring Revenue" is calculated as Annual Recurring Revenue (SaaS), which is an annualized calculation of the monthly recurring revenue in the last month of the calculated quarter for all active Software Products & Services customers, combined with Annual Recurring Revenue (Consumption), which is the trailing twelve month calculation of all non-recurring and/or consumption-based revenue for all active Software Products & Services customers. In prior periods, we provided "Average Annual Revenue," which was calculated as the aggregate of trailing twelve-month Software Products & Services revenue divided by the average number of customers over the same period for both Veritone, Inc. and PandoLogic Ltd. Annual Recurring Revenue is not comparable to Average Annual Revenue. Annual Recurring Revenue reflects the historical information of Veritone combined with the historical information of Broadbean as if Veritone had acquired Broadbean on January 1, 2022 where indicated, is not averaged among active customers and uses a calculation of recurring revenue as described above instead of annual revenue. Veritone completed its acquisition of Broadbean on June 13, 2023. Management uses "Annual Recurring Revenue" and we believe Annual Recurring Revenue is useful to investors because Broadbean significantly increases our mix of subscription-based SaaS revenues as compared to non-recurring and/or consumption-based revenues.
(4)"Total New Bookings" represents the total fees payable during the full contract term for new contracts received in the quarter (including fees payable during any cancellable portion and an estimate of license fees that may fluctuate over the term), excluding any variable fees under the contract (e.g., fees for cognitive processing, storage, professional services and other variable services).
(5) "Gross Revenue Retention" represents our dollar-based gross retention rate as of the period end by starting with the revenue from Software Products & Services Customers as of the 3 months in the prior year quarter to such period, or Prior Year Quarter Revenue. We then deduct from the Prior Year Quarter Revenue any revenue from Software Products & Services Customers who are no longer customers as of the current period end, or Current Period Ending Software Customer Revenue. We then divide the total Current Period Ending Software Customer Revenue by the total Prior Year Quarter Revenue to arrive at our dollar-based gross retention rate, which is the percentage of revenue from all Software Products & Services Customers from our Software Products & Services as of the year prior that is not lost to customer churn. All numbers used to determine Gross Revenue Retention are calculated reflecting the acquisition of Broadbean as if the acquisition had been completed as of January 1, 2022.
* See tables below for reconciliation of non-GAAP financial measures to directly comparable GAAP measures and for the definitions used for Software Products & Services Supplemental Financial Information.
Recent Business Highlights
Public Sector
Closed 13 new public safety and government customers, including the Department of Justice - Office of Public Affairs. Signed agreements with two of the largest counties in Southern California and a state-wide law enforcement agency. Expanded market reach with new strategic partnerships, including Nuix and international conglomerate, Getac.
Commercial Enterprise
Signed multi-year agreement with iHeartMedia, for expansion across their 850+ stations, enabling seamless and analytical process and review of unstructured audio data in near-real time. Secured AWS Media and Entertainment Services Competency in Media Supply Chain and Data Science & Analytics, recognizing our specialized expertise, technical proficiency and proven success in helping customers transform their media and entertainment operations with innovative cloud-based AI solutions. Signed agreement with E.W. Scripps, enabling their Court TV media property to leverage Veritone's AI platform to enhance the storage, management and distribution of its extensive content library. Signed multi-year agreement with ESPN to manage their content library and extended existing agreement with ESPN to utilize Veritone's AI platform to track the impact on native advertising placements and promotions, both spoken and visual, across multiple ESPN-owned channels. Signed a multi-year extension with the National Football League, providing searchable access to valuable sporting content to enrich its fan experience. Signed a multi-year agreement with the NCAA with a contract value of over $40 million. Signed multi-year enterprise deal with Big 4 accounting firm to build-out AI capabilities across its hiring platform. Signed several new enterprise programmatic advertising and job distribution software deals, including global brands such as Magna International, Shell Energy Australia, Marriott International, Ferrovial, Teleperformance, and Mitsubishi Chemical. Completed the divestiture of our media agency, Veritone One, in October 2024, as described above.
Financial Results for Three Months Ended September 30, 2024
Delivered third quarter revenue of $22.0 million, a decrease of $6.0 million or 21% from $28.0 million in the third quarter of 2023. Software Products & Services revenue of $14.7 million decreased by $5.7 million or 28% year over year driven by expected declines in Commercial Enterprise principally from consumption based customers, including Amazon and one-time software revenue in Q3 2023 that did not recur in Q3 2024. Managed Services revenue of $7.3 million was relatively flat when compared to $7.6 million in Q3 2023.
Net loss from continuing operations was $22.5 million improving $4.42 million as compared to $26.7 million in the third quarter of 2023, driven by the year over year improvement in loss from operations, coupled with a $1.6 million higher tax benefit from income in Q3 2024 as compared to Q3 2023. Non-GAAP net loss of $7.1 million decreased by 10% when compared to Non-GAAP net loss of $7.9 million in the third quarter of 2023, largely driven by the decline in Non-GAAP gross profit, which was partially offset by cost reductions enacted during the nine months ended September 30, 2024.
As of September 30, 2024, Total Software Product & Services Customers of 3,291 was down 7% year over year relative to Total Software Product & Services Customers as of September 30, 2023, principally due to declines in Commercial Enterprise from planned migration of legacy CareerBuilder customers off the Broadbean software platform, offset by increases in Public Sector. Total New Bookings increased by 6% to $16.5 million versus the comparable period a year ago largely driven by an increase in subscription-based customer bookings, offset by a reduction in revenue from consumption-based customers, including Amazon. Annual Recurring Revenue of $63.3 million decreased 29% year over year driven in large part by the declines in Commercial Enterprise consumption spending from customers, offset by a slight increase year over year increase in Annual Recurring Revenue from subscription-based SaaS customers.
Business Outlook
Full Year 2024
Revenue is expected to be in the range of $92.5 million to $93.5 million, as compared to $100.0 million for the full year of 2023 Non-GAAP net loss is expected to be in the range of $(37.5) million to $(36.5) million, compared to non-GAAP net loss of $(45.5) million for the full year of 2023.
Full Year 2025
Revenue is expected to be in the range of $107.0 million to $122.0 million, as compared to the midpoint of $93.0 million for fiscal 2024. Non-GAAP net loss is expected to be in the range of $(25.0) million to $(15.0) million, compared to non-GAAP net loss midpoint of $(37.0) million for fiscal 2024.
These updated financial guidance ranges supersede any previously disclosed financial guidance and investors should not rely on any previously disclosed financial guidance.
Conference Call
Veritone will hold a conference call to deliver management's prepared remarks on November 12, 2024, at 8:30 a.m. Eastern Time (5:30 a.m. Pacific Time) to discuss its third quarter 2024 results, provide an update on the business and conduct a question-and-answer session. To participate, please join the audio webcast or dial-in and ask to be connected to the Veritone earnings conference call. To avoid a delay, if dialing in, please pre-register or join the live audio webcast.
Pre-Registration* Live Audio Webcast Domestic Call Number: (844) 750-4897 International Call Number: (412) 317-5293
A replay of the conference call can be accessed one hour after the end of the conference call through November 19, 2024. The full webcast replay will be available through November 12, 2025. To access the earnings webcast replay please visit the Veritone Investor Relations website.
Domestic Replay Number: (877) 344-7529 International Replay Number: (412) 317-0088 Replay Access Code: 7123119
* Please note that pre-registered participants will receive their dial-in number and unique PIN upon registration.
About the Presentation of Supplemental Non-GAAP Financial Information and Key Performance Indicators
In this news release, the Company has supplemented its financial measures prepared in accordance with U.S. generally accepted accounting principles (GAAP) with certain non-GAAP financial measures, including Non-GAAP gross profit, Non-GAAP gross margin, Non-GAAP net income (loss) and Non-GAAP net income (loss) per share. The Company also provides certain key performance indicators (KPIs), including Total Software Products & Services Customers, Annual Recurring Revenue, Annual Recurring Revenue (SaaS), Annual Recurring Revenue (Consumption), Total New Bookings and Gross Revenue Retention. The Company has posted additional supplemental financial information on its website at investors.veritone.com concurrently with this press release.
Non-GAAP gross profit is defined as revenue less cost of revenue. Non-GAAP gross margin is defined as Non-GAAP gross profit divided by revenue. Non-GAAP net income (loss) and non-GAAP net income (loss) per share, respectively, is the Company's net income (loss) and net income (loss) per share, adjusted to exclude provision for income taxes, depreciation expense, amortization expense, stock-based compensation expense, changes in fair value of warrant liability, changes in fair value of contingent consideration, interest income, interest expense, foreign currency gains and losses, acquisition and due diligence costs, gain on sale of energy group, contribution of business held for sale, variable consultant performance bonus expense, and severance and executive transition costs. The items excluded from these non-GAAP financial measures, as well as a breakdown of GAAP net income (loss), non-GAAP net income (loss) and these excluded items, are detailed in the reconciliations included following the financial statements attached to this news release. In addition, following the financial statements attached to this news release, the Company has provided additional supplemental non-GAAP measures of operating expenses, loss from operations, other income (expense), net, and loss before income taxes, excluding the items excluded from non-GAAP net loss as noted above, and reconciling such non-GAAP measures to the most directly comparable GAAP measures.
The Company has provided these non-GAAP financial measures and KPIs because management believes such information to be important supplemental measures of performance that are commonly used by securities analysts, investors and other interested parties in the evaluation of companies in its industry. Management also uses this information internally for forecasting and budgeting. The non-GAAP financial measures should not be considered as an alternative to revenue, net income (loss), operating income (loss) or any other financial measures so calculated and presented, nor as an alternative to cash flow from operating activities as a measure of liquidity. Other companies (including the Company's competitors) may define these non-GAAP financial measures differently. The non-GAAP financial measures may not be indicative of the historical operating results of Veritone or predictive of potential future results. Investors should not consider these non-GAAP financial measures in isolation or as a substitute for analysis of the Company's results as reported in accordance with GAAP.
In addition, the Company defines the following capitalized terms in this news release as follows:
Core Operations consists of the Company's aiWARE operating platform of software, SaaS and related services; content licensing and representation services; and their supporting operations, including direct costs of sales as well as operating expenses for sales, marketing and product development and certain general and administrative costs dedicated to these operations.
Corporate principally consists of general and administrative functions such as executive, finance, legal, people operations, fixed overhead expenses (including facilities and information technology expenses), other income (expenses) and taxes, and other expenses that support the entire Company, including public company driven costs.
Software Products & Services consists of revenues generated from commercial enterprise and government and regulated industries customers using our aiWARE platform and Hiring Solutions, any related support and maintenance services, and any related professional services associated with the deployment and/or implementation of such solutions.
Managed Services consist of revenues generated from commercial enterprise customers using our content licensing and representation services and supporting operations.
About Veritone
Veritone VERI builds human-centered enterprise AI solutions. Serving customers in the media, entertainment, public sector and talent acquisition industries, Veritone's software and services empower individuals at the world's largest and most recognizable brands to run more efficiently, accelerate decision making and increase profitability. Veritone's leading enterprise AI platform, aiWARE™, orchestrates an ever-growing ecosystem of machine learning models, transforming data sources into actionable intelligence. By blending human expertise with AI technology, Veritone advances human potential to help organizations solve problems and achieve more than ever before, enhancing lives everywhere.
To learn more, visit Veritone.com.
Safe Harbor Statement
This news release contains forward-looking statements, including without limitation, statements regarding our prospects for the business after the sale of Veritone One and our future ability to invest in innovation, our ability to capitalize on growth in the AI solutions market, our ability to realize annualized cost-savings including from our recent cost restructurings, and our expected total revenue and non-GAAP net loss for Q4 2024 and for full year 2025. In addition, words such as "may," "will," "expect," "believe," "anticipate," "intend," "plan," "outlook," "should," "could," "estimate," "confident" or "continue" or the plural, negative or other variations thereof or comparable terminology are intended to identify forward-looking statements, and any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward-looking statements. These forward-looking statements speak only as of the date hereof, and are based on management's current assumptions, expectations, beliefs and information. As such, our actual results could differ materially and adversely from those expressed in any forward-looking statement as a result of various factors. Important factors that could cause such differences include, among other things, our operations and financial results after the sale of Veritone One; our ability to continue as a going concern; our ability to expand our aiWARE SaaS business; declines or limited growth in the market for AI-based software applications and concerns over the use of AI that may hinder the adoption of AI technologies; our requirements for additional capital and liquidity to support our operations, our business growth, service our debt obligations and refinance maturing debt obligations, and the availability of such capital on acceptable terms, if at all; our reliance upon a limited number of key customers for a significant portion of our revenue; declines in customers' usage of our products and other offerings; our ability to realize the intended benefits of our acquisitions, divestitures, and other planned or ongoing cost-saving measures, including our ability to successfully integrate our recent acquisition of Broadbean; our identification of existing material weaknesses in our internal control over financial reporting; fluctuations in our results over time; the impact of seasonality on our business; our ability to manage our growth, including through acquisitions and expansion into international markets; our ability to enhance our existing products and introduce new products that achieve market acceptance and keep pace with technological developments; actions by our competitors, partners and others that may block us from using third party technologies in our aiWARE platform, offering it for free to the public or making it cost prohibitive to continue to incorporate such technologies into our platform; interruptions, performance problems or security issues with our technology and infrastructure, or that of our third party service providers; the impact of the continuing economic disruption caused by macroeconomic and geopolitical factors, including the Russia-Ukraine conflict, the war in Israel, financial instability, high interest rates, inflationary pressures and the responses by central banking authorities to control inflation, monetary supply shifts and the threat of recession in the United States and around the world on our business operations and those of our existing and potential customers; and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond our control. Certain of these judgments and risks are discussed in more detail in our most recently-filed Annual Report on Form 10-K, and our Quarterly Reports on Form 10-Q and other periodic reports filed from time to time with the Securities and Exchange Commission. In light of the significant uncertainties inherent in the forward-looking information included herein, the inclusion of such information should not be regarded as a representation by us or any other person that our objectives or plans will be achieved. The forward-looking statements contained herein reflect our beliefs, estimates and predictions as of the date hereof, and we undertake no obligation to revise or update the forward-looking statements contained herein to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events for any reason, except as required by law.
VERITONE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(in thousands)
As of
September 30,
2024
December 31,
2023
ASSETS
Cash and cash equivalents
$
11,422
$
46,609
Accounts receivable, net
33,859
33,895
Prepaid expenses and other current assets
6,162
7,864
Current assets of discontinued operations
113,972
97,446
Total current assets
165,415
185,814
Property, equipment and improvements, net
9,864
8,079
Intangible assets, net
65,488
83,423
Goodwill
53,110
53,529
Long-term restricted cash
936
867
Other assets
7,022
9,164
Non-current assets of discontinued operations
34,590
37,982
Total assets
$
336,425
$
378,858
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Accounts payable
$
9,356
$
16,620
Deferred revenue
12,836
12,813
Term Loan, current portion (1)
38,262
5,813
Accrued purchase consideration, current
983
1,000
Accrued media payments
2,906
2,220
Client advances
17
17
Other accrued liabilities
26,387
26,493
Current liabilities of discontinued operations
158,540
126,893
Total current liabilities
249,287
191,869
Convertible Notes, non-current
89,990
89,572
Term Loan, non-current (1)
12,906
45,012
Accrued purchase consideration, non-current
750
633
Other non-current liabilities
8,653
13,625
Total liabilities
361,586
340,711
Total stockholders' equity (deficit)
(25,161
)
38,147
Total liabilities and stockholders' equity (deficit)
$
336,425
$
378,858
(1) Due to the classification of held-for-sale at September 30, 2024, and the proximity of the October 17, 2024 Divestiture to the September 30, 2024 balance sheet, the Company classified the $30.5 million of debt paid down through the Divestiture as Term Loan, current portion on the September 30, 2024 balance sheet.
VERITONE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
AND COMPREHENSIVE INCOME (LOSS)
(in thousands, except per share and share data)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2023
2024
2023
Revenue
$
21,993
$
27,968
$
70,204
$
72,883
Operating expenses:
Cost of revenue
6,325
7,026
19,614
21,381
Sales and marketing
10,186
10,997
31,230
32,895
Research and development
7,528
10,410
23,388
32,456
General and administrative
14,421
18,264
45,133
48,837
Amortization
6,025
6,454
18,006
17,087
Total operating expenses
44,485
53,151
137,371
152,656
Loss from operations
(22,492
)
(25,183
)
(67,167
)
(79,773
)
Other income (expense), net
(2,594
)
(2,552
)
(8,618
)
1,088
Loss before provision for income taxes
(25,086
)
(27,735
)
(75,785
)
(78,685
)
(Benefit from) provision for income taxes
(2,575
)
(1,003
)
(3,713
)
(2,673
)
Net loss from continuing operations
(22,511
)
(26,732
)
(72,072
)
(76,012
)
Net income from discontinued operations
765
2,191
2,897
5,212
Net loss
$
(21,746
)
$
(24,541
)
$
(69,175
)
$
(70,800
)
Net (loss) income per share:
Basic and diluted net loss from continuing operations
$
(0.59
)
$
(0.72
)
$
(1.91
)
$
(2.06
)
Basic and diluted net income from discontinued operations
$
0.02
$
0.06
$
0.08
$
0.14
Basic and diluted net loss
$
(0.57
)
$
(0.66
)
$
(1.83
)
$
(1.92
)
Weighted average shares outstanding:
Basic and diluted
38,086,765
36,991,650
37,752,562
36,810,878
Comprehensive loss:
Net loss
$
(21,746
)
$
(24,541
)
$
(69,175
)
$
(70,800
)
Foreign currency translation gain (loss), net of income taxes
11
1,749
10
(14
)
Total comprehensive loss
$
(21,735
)
$
(22,792
)
$
(69,165
)
$
(70,814
)
VERITONE, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(in thousands)
Nine Months Ended
September 30,
2024
2023
Cash flows from operating activities:
Net loss
$
(69,175
)
$
(70,800
)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization
21,699
20,154
Provision for credit losses
673
168
Stock-based compensation expense
5,928
8,646
Gain on sale of energy group
--
(2,572
)
Change in fair value of contingent consideration
--
1,468
Change in deferred taxes
(4,968
)
(2,858
)
Amortization of debt issuance costs and debt discounts
4,636
649
Amortization of right-of-use assets
399
1,127
Imputed non-cash interest income
(263
)
(108
)
Changes in assets and liabilities:
Accounts receivable
2,959
14,052
Expenditures billable to clients
(17,550
)
(2,108
)
Prepaid expenses and other assets
407
1,224
Other assets
3,425
(1,300
)
Accounts payable
(8,346
)
2,405
Deferred revenue
23
(913
)
Accrued media payments
14,033
(17,718
)
Client advances
19,697
(1,567
)
Other accrued liabilities
2,130
4,714
Other liabilities
70
(2,774
)
Net cash used in operating activities
(24,223
)
(48,111
)
Cash flows from investing activities:
Proceeds from sale of energy group
1,800
504
Capital expenditures
(5,134
)
(4,054
)
Acquisitions, net of cash acquired
--
(50,195
)
Net cash used in investing activities
(3,334
)
(53,745
)
Cash flows from financing activities:
Payment of debt principal
(3,875
)
--
Payment of purchase consideration
--
(7,772
)
Taxes paid related to net share settlement of equity awards
(653
)
(1,088
)
Proceeds from issuances of stock under employee stock plans, net
433
1,063
Settlement of deferred consideration for acquisitions
(1,800
)
(2,690
)
Net cash used in financing activities
(5,895
)
(10,487
)
Net decrease in cash and cash equivalents and restricted cash
(33,452
)
(112,343
)
Cash and cash equivalents and restricted cash, beginning of period
80,306
185,282
Cash and cash equivalents and restricted cash, end of period
46,854
72,939
Less: Cash and cash equivalents and restricted cash included in discontinued operations
34,496
58,001
Cash and cash equivalents and restricted cash included in continuing operations
$
12,358
$
14,938
VERITONE, INC.
REVENUE DETAIL (UNAUDITED)
(in thousands)
Three Months Ended September 30,
2024
2023
Commercial
Public
Commercial
Public
Enterprise
Sector
Total
Enterprise
Sector
Total
Total Software Products & Services
$
13,098
$
1,596
$
14,694
$
18,885
$
1,476
$
20,361
Managed Services
Representation Services
2,730
--
2,730
2,828
--
2,828
Licensing
4,569
--
4,569
4,779
--
4,779
Total Managed Services
7,299
--
7,299
7,607
--
7,607
Total Revenue
$
20,397
$
1,596
$
21,993
$
26,492
$
1,476
$
27,968
Nine Months Ended September 30,
2024
2023
Commercial
Public
Commercial
Public
Enterprise
Sector
Total
Enterprise
Sector
Total
Total Software Products & Services
$
41,310
$
4,236
$
45,546
$
44,109
$
4,472
$
48,581
Managed Services
Representation Services
9,763
--
9,763
8,465
--
8,465
Licensing
14,895
--
14,895
15,837
--
15,837
Total Managed Services
24,658
--
24,658
24,302
--
24,302
Total Revenue
$
65,968
$
4,236
$
70,204
$
68,411
$
4,472
$
72,883
VERITONE, INC.
RECONCILIATION OF NON-GAAP NET INCOME (LOSS) TO GAAP NET LOSS (UNAUDITED)
(in thousands)
Three Months Ended September 30,
2024
2023
Core
Operations(1)
Corporate(2)
Total
Core
Operations(1)
Corporate(2)
Total
Net loss
$
(10,448
)
$
(11,298
)
$
(21,746
)
$
(10,689
)
$
(13,854
)
$
(24,543
)
Income from discontinued operations, net of income tax
(765
)
--
(765
)
(2,191
)
--
(2,191
)
(Benefit from) provision for income taxes
(2,575
)
--
(2,575
)
(3,189
)
2,186
(1,003
)
Depreciation and amortization
7,040
112
7,152
7,623
--
7,623
Stock-based compensation expense
1,002
1,097
2,099
1,367
586
1,953
Purchase consideration expense(3)
--
367
367
--
816
816
Interest expense, net
--
2,987
2,987
96
218
314
Foreign currency impact
--
(393
)
(393
)
2,318
(24
)
2,294
Acquisition and due diligence costs(4)
--
368
368
--
3,177
3,177
Variable consultant performance bonus expense (6)
--
--
--
397
--
397
Severance and executive transition costs
1,351
58
1,409
737
15
752
Non-GAAP net loss from continuing operations
(4,395
)
(6,702
)
(11,097
)
(3,531
)
(6,880
)
(10,411
)
Non-GAAP net income from discontinued operations
3,984
--
3,984
2,468
--
2,468
Non-GAAP net loss
$
(411
)
$
(6,702
)
$
(7,113
)
$
(1,063
)
$
(6,880
)
$
(7,943
)
Nine Months Ended September 30,
2024
2023
Core
Operations(1)
Corporate(2)
Total
Core
Operations(1)
Corporate(2)
Total
Net loss
$
(41,764
)
$
(27,411
)
$
(69,175
)
$
(38,464
)
$
(32,336
)
$
(70,800
)
Income from discontinued operations, net of income tax
(2,897
)
--
(2,897
)
(5,212
)
--
(5,212
)
(Benefit from) provision for income taxes
(3,713
)
--
(3,713
)
(4,460
)
1,787
(2,673
)
Depreciation and amortization
21,117
337
21,454
18,592
724
19,316
Stock-based compensation expense
2,586
3,105
5,691
5,267
2,936
8,203
Purchase consideration expense(3)
--
1,252
1,252
--
1,467
1,467
Interest expense, net
--
8,485
8,485
330
1,734
2,064
Foreign currency impact
--
(29
)
(29
)
(459
)
(67
)
(526
)
Gain on debt extinguishment
--
(8
)
(8
)
--
--
--
Acquisition and due diligence costs(4)
3,257
--
3,257
--
8,253
8,253
Loss (gain) on sale
--
172
172
--
(2,572
)
(2,572
)
Contribution of business held for sale(5)
--
--
--
1,789
--
1,789
Variable consultant performance bonus expense (6)
--
--
--
1,028
--
1,028
Severance and executive transition costs
4,194
178
4,372
2,183
647
2,830
Non-GAAP net loss from continuing operations
(17,220
)
(13,919
)
(31,139
)
(19,406
)
(17,427
)
(36,833
)
Non-GAAP net income from discontinued operations
9,560
--
9,560
6,310
--
6,310
Non-GAAP net loss
$
(7,660
)
$
(13,919
)
$
(21,579
)
$
(13,096
)
$
(17,427
)
$
(30,523
)
(1) Core operations consists of our consolidated Software Products & Services and Managed Services that include our content licensing and representation services, and their supporting operations, including direct costs of sales as well as operating expenses for sales, marketing and product development and certain general and administrative costs dedicated to these operations.
(2) Corporate consists of general and administrative functions such as executive, finance, legal, people operations, fixed overhead expenses (including facilities and information technology expenses), other income (expenses) and taxes, and other expenses that support the entire company, including public company driven costs.
(3) Purchase consideration expense includes consideration related to acquisitions.
(4) For the three and nine months ended September 30, 2024, acquisition and due diligence costs are comprised of professional fees related to our acquisitions and divestitures.
(5) Contribution of business held for sale relates to the net loss for the periods presented for our Energy Group that we divested during the second quarter of 2023.
(6) Variable consultant performance bonus expense represents the bonus payments paid to Mr. Chad Steelberg as a result of his achievement of the performance goals pursuant to his consulting agreement with us.
VERITONE, INC.
RECONCILIATION OF NON-GAAP NET INCOME FROM DISCONTINUED OPERATIONS TO GAAP NET INCOME FROM DISCONTINUED OPERATIONS (UNAUDITED)
(in thousands)
(in thousands)
Three Months Ended September 30,
2024
2023
Core
Operations
Corporate
Total
Core
Operations
Corporate
Total
Net income from discontinued operations
$
765
$
--
$
765
$
2,191
$
--
$
2,191
Provision for income taxes
26
--
26
26
--
26
Depreciation and amortization
87
--
87
235
--
235
Stock-based compensation expense
82
--
82
79
0
79
Interest expense, net
1,699
--
1,699
(96
)
--
(96
)
Acquisition and due diligence costs(1)
1,292
--
1,292
--
--
--
Severance and executive transition costs
33
--
33
33
--
33
Non-GAAP net income from discontinued operations
$
3,984
$
--
$
3,984
$
2,468
$
--
$
2,468
(in thousands)
Nine Months Ended September 30,
2024
2023
Core
Operations
Corporate
Total
Core
Operations
Corporate
Total
Net income from discontinued operations
$
2,897
$
--
$
2,897
$
5,212
$
--
$
5,212
Provision for income taxes
76
--
76
51
--
51
Depreciation and amortization
245
--
245
837
--
837
Stock-based compensation expense
237
--
237
443
--
443
Interest expense, net
4,689
--
4,689
(321
)
--
(321
)
Acquisition and due diligence costs(1)
1,369
--
1,369
--
--
--
Severance and executive transition costs
47
--
47
88
--
88
Non-GAAP net income from discontinued operations
$
9,560
$
--
$
9,560
$
6,310
$
--
$
6,310
(1) For the three and nine months ended September 30, 2024, acquisition and due diligence costs are comprised of professional fees related to our acquisitions and divestitures.
VERITONE, INC.
RECONCILIATION OF EXPECTED NON-GAAP NET LOSS RANGE
TO EXPECTED GAAP NET LOSS RANGE (UNAUDITED)
(in millions)
Year Ended
December 31, 2024
December 31, 2025
Net Loss
($57.0) to ($51.4)
($78.0) to ($63.5)
Income from discontinued operations, net of income taxes
($2.9)
$0.0
Provision for (benefit from) income taxes
($4.5) to ($5.5)
$1.0 to ($1.0)
Interest expense, net
$24.0 to $23.0
$15.0 to $14.0
Depreciation and amortization
$28.9
$28.0
Stock-based compensation expense
$7.7 to $7.6
$7.5 to $6.7
Acquisition and due diligence costs
$5.0 to $4.0
$0.0
Purchase consideration expense(1)
$0.3
$0.5 to $0.3
Gain on sale
($44.0) to ($45.0)
$0.0
Severance and executive transition costs
$5.0 to $4.5
$1.0 to $0.5
Non-GAAP net loss from continuing operations
($37.5) to ($36.5)
($25.0) to ($15.0)
Non-GAAP net income from discontinued operations
$9.6
$0.0
Non-GAAP net loss
($27.9) to ($26.9)
($25.0) to ($15.0)
Year Ended
December 31, 2024
December 31, 2025
Net income from discontinued operations
$2.9
$0.0
Provision for (benefit from) income taxes
$0.1
$0.0
Interest expense, net
$4.7
$0.0
Depreciation and amortization
$0.3
$0.0
Stock-based compensation expense
$0.2
$0.0
Acquisition and due diligence costs
$1.4
$0.0
Non-GAAP net income from discontinued operations
$9.6
$0.0
(1) Purchase consideration expense includes consideration related to acquisitions.
VERITONE, INC.
RECONCILIATION OF NON-GAAP TO GAAP FINANCIAL INFORMATION (UNAUDITED)
(in thousands, except per share data)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2023
2024
2023
Revenue
$
21,993
$
27,968
$
70,204
$
72,883
Cost of revenue
6,325
7,026
19,614
21,381
Non-GAAP gross profit
15,668
20,942
50,590
51,502
GAAP cost of revenue
6,325
7,026
19,614
21,381
Stock-based compensation expense
--
7
1
(32
)
Non-GAAP cost of revenue
6,325
7,033
19,615
21,349
GAAP sales and marketing expenses
10,186
10,997
31,230
32,895
Depreciation
59
46
171
124
Stock-based compensation expense
(253
)
(189
)
(699
)
(824
)
Contribution of business held for sale (2)
--
--
--
(484
)
Severance and executive transition costs
(188
)
(201
)
(1,169
)
(690
)
Non-GAAP sales and marketing expenses
9,804
10,653
29,533
31,021
GAAP research and development expenses
7,528
10,410
23,388
32,456
Depreciation
(767
)
(334
)
(2,119
)
(854
)
Stock-based compensation expense
(439
)
(953
)
(1,066
)
(3,622
)
Contribution of business held for sale (2)
--
--
--
(1,117
)
Severance and executive transition costs
(926
)
(188
)
(2,384
)
(868
)
Non-GAAP research and development expenses
5,396
8,935
17,819
25,995
GAAP general and administrative expenses
14,421
18,264
45,133
48,837
Depreciation
(419
)
(881
)
(1,500
)
(1,500
)
Stock-based compensation expense
(1,407
)
(816
)
(3,927
)
(3,724
)
Purchase consideration expense (3)
(367
)
(816
)
(1,252
)
(1,467
)
Variable consultant performance bonus expense (4)
--
(397
)
--
(1,028
)
Contribution of business held for sale (2)
--
--
--
(188
)
Acquisition and due diligence costs (5)
(368
)
(3,177
)
(3,257
)
(8,253
)
Severance and executive transition costs
(295
)
(363
)
(819
)
(1,272
)
Non-GAAP general and administrative expenses
11,565
11,814
34,378
31,405
GAAP amortization
(6,025
)
(6,454
)
(18,006
)
(17,087
)
GAAP loss from operations
(22,492
)
(25,183
)
(67,167
)
(79,773
)
Total non-GAAP adjustments (1)
11,395
14,716
36,026
42,886
Non-GAAP loss from operations
(11,097
)
(10,467
)
(31,141
)
(36,887
)
GAAP other income (expense), net
(2,594
)
(2,552
)
(8,618
)
1,088
Gain on debt extinguishment
--
--
(8
)
--
Loss (gain) on sale
--
--
172
(2,572
)
Foreign currency impact
(393
)
2,294
(29
)
(526
)
Interest expense, net
2,987
314
8,485
2,064
Non-GAAP other expense, net
--
56
2
54
GAAP loss before income taxes
(25,086
)
(27,735
)
(75,785
)
(78,685
)
Total non-GAAP adjustments (1)
13,989
17,324
44,646
41,852
Non-GAAP loss before income taxes
(11,097
)
(10,411
)
(31,139
)
(36,833
)
(Benefit from) provision for income taxes
(2,575
)
(1,003
)
(3,713
)
(2,673
)
GAAP net loss
(22,511
)
(26,732
)
(72,072
)
(76,012
)
Total non-GAAP adjustments (1)
11,414
16,321
40,933
39,179
Non-GAAP net loss from continuing operations
(11,097
)
(10,411
)
(31,139
)
(36,833
)
Non-GAAP net income from discontinued operations
3,984
2,468
9,560
6,310
Non-GAAP net loss
$
(7,113
)
$
(7,943
)
$
(21,579
)
$
(30,523
)
Shares used in computing non-GAAP basic and diluted net loss per share (in 000's)
38,087
36,992
37,753
36,811
Basic and diluted net loss per share from continuing operations
$
(0.29
)
$
(0.28
)
$
(0.82
)
$
(1.00
)
Basic and diluted net income per share from discontinued operations
$
0.10
$
0.07
$
0.25
$
0.17
Non-GAAP basic and diluted net loss per share
$
(0.19
)
$
(0.21
)
$
(0.57
)
$
(0.83
)
(1) Adjustments are comprised of the adjustments to GAAP cost of revenue, sales and marketing expenses, research and development expenses and general and administrative expenses and other income (expense), net (where applicable) listed above.
(2) Contribution of business held for sale relates to the net loss for the periods presented for our Energy Group that we divested during Q2 2023.
(3) Purchase consideration expense includes consideration related to acquisitions.
(4) Variable consultant performance bonus expense represents the bonus payments paid to Mr. Chad Steelberg as a result of his achievement of the performance goals pursuant to his consulting agreement with us.
(5) For the three and nine months ended September 30, 2024, acquisition and due diligence costs are comprised of professional fees related to our acquisitions and divestitures.
VERITONE, INC.
SUPPLEMENTAL FINANCIAL INFORMATION
We are providing the following unaudited supplemental financial information as a lookback of prior years to explain our recent historical and year-over-year performance.
Software Products & Services Supplemental Financial Information
Quarter Ended
Mar 31,
Jun 30,
Sept 30,
Dec 31,
Mar 31,
Jun 30,
Sept 30,
Dec 31,
Mar 31,
Jun 30,
Sep 30,
2022 (1)
2022 (1)
2022 (1)
2022 (1)
2023 (1)
2023 (1)
2023
2023
2024
2024
2024
Pro Forma Software Revenue (in 000's) (2)
$
26,319
$
26,650
$
28,603
$
35,612
$
22,423
$
20,859
$
20,361
$
19,824
$
15,223
$
15,632
$
14,694
Total Software Products & Services Customers (3)
3,673
3,718
3,787
3,824
3,773
3,705
3,536
3,459
3,384
3,437
3,291
Annual Recurring Revenue (SaaS) (in 000's) (4)
$
48,392
$
44,465
$
43,925
$
46,248
$
45,453
$
47,720
$
47,756
$
49,122
$
49,064
$
49,223
$
48,269
Annual Recurring Revenue (Consumption) (in 000's) (5)
$
87,445
$
85,901
$
85,091
$
71,754
$
67,242
$
60,229
$
41,543
$
30,967
$
23,510
$
18,701
$
15,011
Total New Bookings (in 000's) (6)
$
16,643
$
22,009
$
23,793
$
26,342
$
22,794
$
8,388
$
15,501
$
17,457
$
12,964
$
14,047
$
16,471
Gross Revenue Retention (7)
>90%
>90%
>90%
>90%
>90%
>90%
>90%
>90%
>90%
>90%
>90%
(1) All of the supplemental financial information for this period reflects the historical information of Veritone combined with the historical information of Broadbean as if Veritone had acquired Broadbean on January 1, 2022. Veritone completed its acquisition of Broadbean on June 13, 2023.
(2) "Pro Forma Software Revenue" is a non-GAAP measure that represents Software Products & Services revenue as if Veritone had acquired Broadbean on January 1, 2022. Veritone completed its acquisition of Broadbean on June 13, 2023.
(3) "Total Software Products & Services Customers" includes Software Products & Services customers as of the end of each respective quarter set forth above with net revenues in excess of $10 and also excludes any customers categorized by us as trial or pilot status. In prior periods, we provided "Ending Software Customers," which represented Software Products & Services customers as of the end of each fiscal quarter with trailing twelve-month revenues in excess of $2,400 for both Veritone, Inc. and PandoLogic Ltd. and/or deemed by the Company to be under an active contract for the applicable periods. Total Software Products & Services Customers is not comparable to Ending Software Customers. Total Software Products & Services Customers includes customers based on revenues in the last month of the quarter rather than on a trailing twelve-month basis. Total Software Products & Services Customers includes customers based on revenues in the last month of the quarter rather than on a trailing twelve-month basis and excludes any customers that are on trial or pilot status with us rather than including customers with active contracts. Management uses Total Software Products & Services Customers and we believe Total Software Products & Services Customers are useful to investors because it more accurately reflects our total customers for our Software Products & Services customers inclusive of Broadbean.
(4) "Annual Recurring Revenue (SaaS)" represents an annualized calculation of monthly recurring revenue during the last month of the applicable quarter for all Total Software Products & Services customers, in each case as if Veritone had acquired Broadbean on January 1, 2022. Veritone completed its acquisition of Broadbean on June 13, 2023.. In prior periods, we provided "Average Annual Revenue," which was calculated as the aggregate of trailing twelve-month Software Products & Services revenue divided by the average number of customers over the same period for both Veritone, Inc. and PandoLogic Ltd. Annual Recurring Revenue is not comparable to Average Annual Revenue (SaaS). Annual Recurring Revenue (SaaS) includes only subscription-based SaaS revenue, is not averaged among active customers and uses a calculation of recurring revenue as described above instead of annual revenue. Management uses "Annual Recurring Revenue (SaaS)" and we believe Annual Recurring Revenue (SaaS) is useful to investors because Broadbean significantly increases our mix of subscription-based SaaS revenues as compared to Consumption revenues and the split between the two allows the reader to delineate between predictable recurring SaaS revenues and more volatile Consumption revenues.
(5) "Annual Recurring Revenue (Consumption)" represents the trailing twelve months of all non-recurring and/or consumption-based revenue for all active Total Software Products & Services customers, in each case, as if Veritone had acquired Broadbean on January 1, 2022. Veritone completed its acquisition of Broadbean on June 13, 2023.. In prior periods, we provided "Average Annual Revenue," which was calculated as the aggregate of trailing twelve-month Software Products & Services revenue divided by the average number of customers over the same period for both Veritone, Inc. and PandoLogic Ltd. Annual Recurring Revenue (Consumption) is not comparable to Average Annual Revenue. Annual Recurring Revenue (Consumption) includes only non-recurring and/or consumption-based revenue, is not averaged among active customers and uses a calculation of recurring revenue as described above instead of annual revenue. Management uses "Annual Recurring Revenue (Consumption)" and we believe Annual Recurring Revenue (Consumption) is useful to investors because Broadbean significantly increases our mix of subscription-based SaaS revenues as compared to Consumption revenues and the split between the two allows the reader to delineate between predictable recurring SaaS revenues and more volatile Consumption revenues.
(6) "Total New Bookings" represents the total fees payable during the full contract term for new contracts received in the quarter (including fees payable during any cancellable portion and an estimate of license fees that may fluctuate over the term), excluding any variable fees under the contract (e.g., fees for cognitive processing, storage, professional services and other variable services), in each case as if Veritone had acquired Broadbean on January 1, 2022. Veritone completed its acquisition of Broadbean on June 13, 2023.
(7) "Gross Revenue Retention" represents a calculation of our dollar-based gross revenue retention rate as of the period end by starting with the revenue from Software Products & Services Customers as of the 3 months in the prior year quarter to such period, or Prior Year Quarter Revenue. We then deduct from the Prior Year Quarter Revenue any revenue from Software Products & Services Customers who are no longer customers as of the current period end, or Current Period Ending Software Customer Revenue. We then divide the total Current Period Ending Software Customer Revenue by the total Prior Year Quarter Revenue to arrive at our dollar-based gross retention rate, which is the percentage of revenue from all Software Products & Services Customers from our Software Products & Services as of the year prior that is not lost to customer churn. All numbers used to determine Gross Revenue Retention are calculated as if Veritone had acquired Broadbean on January 1, 2022. Veritone completed its acquisition of Broadbean on June 13, 2023.
The following table sets forth the reconciliation of revenue to pro forma revenue and the calculation of pro forma annual recurring revenue.
Quarter Ended
Mar 31,
Jun 30,
Sept 30,
Dec 31,
Mar 31,
Jun 30,
Sept 30,
Dec 31,
Mar 31,
Jun 30,
Sep 30,
2022
2022
2022
2022
2023
2023
2023
2023
2024
2024
2024
Software Products & Services Revenue (in 000's)
$
18,167
$
18,379
$
20,812
$
27,220
$
14,127
$
14,093
$
20,361
$
19,820
$
15,220
$
15,632
$
14,694
Broadbean Revenue (in 000's) (1)
6,204
6,974
7,639
8,230
8,156
8,374
8,739
8,662
8,517
8,690
8,169
Broadbean Revenue included in Software Products & Services Revenue (in 000's)
--
--
--
--
--
(1,716
)
(8,739
)
(8,662
)
(8,517
)
(8,690
)
(8,169
)
Pro Forma Software Revenue (in 000's)
$
24,371
$
25,353
$
28,451
$
35,450
$
22,283
$
20,751
$
20,361
$
19,820
$
15,220
$
15,632
$
14,694
Managed Services Revenue (in 000's)
16,240
15,856
16,384
16,670
16,136
13,874
14,772
14,377
16,416
15,360
7,299
Total Pro Forma Revenue (in 000's)
$
40,611
$
41,209
$
44,835
$
52,120
$
38,419
$
34,625
$
35,133
$
34,197
$
31,636
$
30,992
$
21,993
Trailing Twelve Months Ended
Mar 31,
Jun 30,
Sept 30,
Dec 31,
Mar 31,
Jun 30,
Sept 30,
Dec 31,
Mar 31,
Jun 30,
Sep 30,
2022
2022
2022
2022
2023
2023
2023
2023
2024
2024
2024
Software Products & Services Revenue (in 000's)
$
72,997
$
85,796
$
97,581
$
84,578
$
80,538
$
76,252
$
75,801
$
68,401
$
69,494
$
71,033
$
65,366
Broadbean Revenue (in 000's) (1)
29,599
30,006
30,136
29,047
30,999
32,399
33,499
33,931
34,292
34,608
34,038
Broadbean Revenue included in Software Products & Services Revenue (in 000's)
--
--
--
--
--
(1,716
)
(10,455
)
(19,117
)
(27,634
)
(34,608
)
(34,038
)
Pro Forma Software Revenue (in 000's)
$
102,596
$
115,802
$
127,717
$
113,625
$
111,537
$
106,935
$
98,845
$
83,215
$
76,152
$
71,033
$
65,366
Managed Services Revenue (in 000's)
58,419
60,546
63,406
65,150
65,046
63,064
61,452
59,159
59,439
60,925
53,452
Total Pro Forma Revenue (in 000's)
$
161,015
$
176,348
$
191,123
$
178,775
$
176,583
$
169,999
$
160,297
$
142,374
$
135,591
$
131,958
$
118,818
Pro Forma Total Number of Customers
3,673
3,718
3,787
3,824
3,773
3,705
3,536
3,459
3,384
3,437
3,291
Pro Forma Annual Recurring Revenue (in 000's) (2)
$
135,837
$
130,366
$
129,016
$
118,002
$
112,695
$
107,949
$
89,299
$
80,089
$
72,574
$
67,924
$
63,280
(1) "Pro Forma Software Revenue" includes historical Software Products & Services Revenue from the past eleven (11) fiscal quarters of each of Veritone, Inc. and Broadbean and presents such revenue on a combined basis treating Broadbean as owned by Veritone, Inc. since January 1, 2022.
(2) "Pro Forma Annual Recurring Revenue" represents an annualized calculation of the monthly recurring revenue in the last period of the calculated quarter, combined with the trailing twelve month calculation for all non-recurring and/or consumption based revenue for all active customers.
VERITONE, INC.
RECONCILIATION OF NON-GAAP GROSS PROFIT TO LOSS FROM OPERATIONS
(in thousands)
(dollars in thousands)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2023
2024
2023
Loss from operations
$
(22,492
)
$
(25,183
)
$
(67,167
)
$
(79,773
)
Sales and marketing
10,186
10,997
31,230
32,895
Research and development
7,528
10,410
23,388
32,456
General and administrative
14,421
18,264
45,133
48,837
Amortization
6,025
6,454
18,006
17,087
Non-GAAP gross profit
$
15,668
$
20,942
$
50,590
$
51,502
Non-GAAP gross margin
71.2
%
74.9
%
72.1
%
70.7
%
View source version on businesswire.com: https://www.businesswire.com/news/home/20241111849905/en/
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Why There Are So Many Bad Managers And What We Can Do About It
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We've all heard the saying, "People don't leave bad companies; they leave bad managers." Unfortunately, it seems there's no shortage of poor management. The impact of bad managers extends far beyond disgruntled employees -- it's bad for business. The cost of bad management is staggering, with estimates putting the financial toll at over $960 billion annually in the U.S. and $8.1 trillion globally,
...
according to Quartz Business News.
Bad managers are a major drag on employee engagement. Gallup's research reveals that 70% of a team's engagement is directly tied to their manager. When engagement drops, the ripple effects can be costly -- lower productivity, higher turnover, and a toxic work environment that's hard to recover from.
Given these statistics, you'd think organizations would be doing everything in their power to eliminate poor management. Yet, incompetent managers remain prevalent. In fact, Gallup finds that companies fail to choose the right candidate 82% of the time.
In many organizations, the path to career advancement is narrow. Ambitious employees who excel in their roles but have no desire to manage others often find themselves with limited options for growth. The only way up is to transition from individual contributor to manager, even if they lack the inclination or skills for leadership. This scenario leads to employees taking on management roles not out of a passion for leading, but for the salary bump, title, and status that comes with it.
Leadership Expert and President of IMS, Charles Good said, "Instead of pushing talented individual contributors into leadership roles, organizations should find ways to leverage their strengths by offering different paths for career development beyond the usual ones. In their internationally best-selling book, Help Them Grow or Watch Them Go, Beverly Kaye and Julie Winkle Guilioni highlight an important point: Some of the best conversations you can have with your employees revolve around what career success means to them. Getting to know their definition of career success is the first step. From there, pursuing that vision can take many forms and go in all sorts of directions!"
Promotion decisions are often based on past performance rather than future potential. Organizations tend to reward high performers with management roles, assuming that success in one area automatically translates to leadership ability. This backward-looking approach overlooks critical factors like emotional intelligence, leadership attributes, and the desire to lead. As a result, promotions become rewards rather than acknowledgments of true leadership potential.
In some companies, internal politics play a bigger role in promotions than merit. Those who excel at networking or have strong political connections within the organization may find themselves in management roles, regardless of their ability to inspire and engage a team. This approach undermines the principle of meritocracy and often places unqualified individuals in positions of power.
Another common mistake is promoting someone to a management position as a means of keeping them, even when leadership isn't what they want or are suited for. This short-sighted approach often backfires, leading to unhappy managers and disengaged teams. To retain top talent, organizations need to understand what truly motivates their employees and find ways to offer growth opportunities that don't necessarily involve managing others.
Once a bad manager is in place, it's hard to remove them. Those who made the promotion decision may be reluctant to admit they were wrong, and sometimes, the extent of a manager's incompetence is only known to their immediate team. In cases where managers are bullies and the corporate culture doesn't reward honest communication, employees may be too intimidated to speak up, allowing the toxic behavior to fester.
Many managers are thrown into leadership roles without the proper training and support. They receive leadership development after the promotion, which sets them up to fail. Despite the billions of dollars spent on leadership development each year, the training often doesn't align with the real-world challenges managers face. This disconnect leaves new managers underprepared to lead effectively. Good added, "Companies should prioritize leadership development as an ongoing journey, recognizing that it starts long before an individual is promoted and continues throughout their career. By investing in this continuous growth, companies can build a strong pipeline of capable leaders ready to drive organizational success."
Leadership development should be customized to maximize impact. Melissa Janis, a leading expert in new manager development cautions, "Even when managers receive training, they often struggle to maximize its value because the program isn't tailored to their specific needs. Covering a wide range of topics like communication, delegation, and business acumen, one-size-fits-all programs overwhelm managers with information they can't immediately use, and they're left to figure out how to apply these concepts on their own. Without development that meets them where they are and the support they need to apply new concepts, training becomes just another box to check, failing to drive real results and leaving both managers and companies frustrated."
Organizations that are willing to change the way they hire, promote, evaluate, and develop their leaders will have a significant advantage over their competitors.
Leadership potential should be assessed and prioritized over past performance. Companies can use 360-degree feedback from colleagues and direct reports to evaluate candidates' leadership qualities before promoting them. This approach ensures that promotions are based on the potential to lead, not just technical expertise.
Rather than waiting until someone is promoted to provide leadership training, organizations should offer management training as soon as they recognize potential. This proactive approach helps employees develop the skills they need to succeed in leadership roles, reducing the likelihood of failure once they're promoted.
Organizations need to create alternative career paths that don't involve managing others. By understanding employees' motivations, companies can offer growth opportunities that align with their interests and strengths, whether that means taking on an international assignment, leading a specialized project, or deepening their expertise in a specific area.
Managers who aren't performing need support to change their behaviors and master new skills. But, if they don't improve, they should be demoted or let go. Taking this tough stance sends a clear message that poor management won't be tolerated and reinforces the importance of leadership integrity and effectiveness.
Not everyone is suited for management, and not everyone aspires to a leadership role. By rethinking how promotions and employee growth are handled, organizations can significantly reduce the prevalence of bad managers. The result? A more engaged workforce, better business outcomes, and a workplace culture where true leadership is recognized and rewarded.
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There's a talent crunch in the job market. 'I have an offer' starts retention contest
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And for some, it's a chance to step up and get a higher pay rise within the same organisation. When an employee comes with the line "I have an offer," with sort of a winner's swag, it is meant to immediately start a matching contest -- for compensation, job profile and flexibility to help work-life balance! In a job market, so devoid of talent, this contest plays out frequently across
...
organisations to retain an employee, even when they may not be the best fit for the role, as recent conversations with people from varied backgrounds reveal. There's a reason for this.
The reason any organisation tries to retain an employee is that the exercise of hiring from another company has become more tedious and time-consuming than it ever was. It's quite likely that the knowledge of the talent crunch in the job market reached jobseekers long before experts began flagging it at marquee conferences and summits. That knowledge gives jobseekers courage, confidence and power that those from earlier vintage lacked.
How times have changed, any old-timer would say. Earlier, one would go discreetly for that rare job interview or a meeting that might translate into a job prospect. The meeting place would be handpicked to ward off all risks (read, keeping the boss or that nosey colleague out of the picture). In contrast, now job interviews, like offers, are to be flaunted. There's no fear anymore of being spotted in another organisation. It's even better if the information is passed on to the current boss, who, in a desperate attempt to retain talent, will possibly offer a hike and a promotion. The jobseeker will then go to the new employer and bargain. And so on.... Whether an aspirant will settle for the new employer's offer or the current one's counteroffer is a question with no straight answer. It's, however, clear that in most cases it's the candidate who closes the deal, not the other way round. What starts with "I'm open to a conversation'', could end with "I'm not looking for a change'' many weeks later.
Why has the white-collar hiring pool shrunk so much in some professions? It's tough to pinpoint the exact reasons, but a recent report by Michael Page, a recruitment firm, gave out some telling numbers based on a talent trend survey of over 3,000 respondents from across seniority levels and industries. It found that 34 per cent of organisations in India are struggling to spot the right talent and almost a third of them are trying hard to retain their employees. According to the report, even among those happy with their current salary, 94 per cent are open to new roles. So the assumption is that an employee needs more than just competitive salaries, and factors such as work-life balance, manager relationships, clear promotion paths, and recognition are crucial for making retention easier.
A Gartner HR survey last year focused on the reasons why an employee stays back in an organisation and why a candidate rejects an offer. In a survey of some 3,500 candidates globally, Gartner found greater flexibility (59 per cent), better work-life balance (45 per cent) and higher compensation (40 per cent) were the top drivers. The 2023 survey also showed that 50 per cent of the respondents backed out after accepting a job offer. In 2022, 44 per cent of the respondents had backed out after accepting offers, the earlier Gartner numbers revealed. In pre-pandemic times, the back-out numbers were lower. In 2019, for instance, 36 per cent of the respondents had backed out after accepting an offer.
As Korn Ferry, a prominent organisational consultancy firm, says, there are too few candidates for too many jobs, a trend that took off during the great resignation wave in 2021. Against this backdrop, organisations have to finetune their workplace dynamics, so that hiring and retention of talent become more meaningful.
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Employers seeking skilled workers often overlook military veterans
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Ashley Bethea transitioned from the Air Force into a job as a government contractor. Veterans can face challenges translating their military skills to civilian roles. Employers too often overlook or discount the experience veterans bring, a report found.
Last summer, during her final month in the Air Force, Ashley Bethea cried almost every day.
Bethea, 40, felt on edge about giving up part of
...
the identity she'd held since she was 18. She was also nervous about making it in a civilian job market, where she had no experience.
"For 21 years, the military was who I was," Bethea told Business Insider. "I had no clue what corporate America looked like."
Her predicament is one that often confronts military members attempting to shift from drills and missions to slide decks and sales targets.
Ashley Bethea retired from the Air Force in July. Foto: Courtesy Ashley Bethea
Employers often face the inverse challenge: not knowing how veterans' abilities might translate to a civilian workforce, executives who work with vets told BI. These advocates for hiring veterans said that by looking a little closer at the skills undergirding veterans' experience, employers could help plug gaps in their workforces.
Bosses who dig into veterans' qualifications might like what they find. A 2023 LinkedIn report examining its users' experiences said veterans were three times as likely as those who hadn't served in the military to have a graduate degree or higher.
Yet at the same time, employers often overlook or discount military experience, LinkedIn found. The result: Veterans are only half as likely to rise to the level of director or VP even though they have almost double the work experience of nonveterans, the report said.
The gap exists even as more employers say they're interested in prioritizing skills over pedigree. Even so, many hiring managers still scan résumés for four-year degrees and prior experience in a role, hiring experts previously told BI.
A résumé for the private sector
Bethea, who retired from the Air Force at the end of July, turned to a nonprofit called Hire Heroes USA to help her translate her experience running logistics for deploying and returning airmen into something palatable to hiring managers. A representative from Hire Heroes helped Bethea craft her first-ever résumé.
"I just wanted to highlight that I could work all avenues of logistics, whether it be supply, transportation, people, equipment, or whatever the case was," Bethea, a mother of three, said.
A Hire Heros USA advisor also helped coach Bethea on salary negotiations.
Ross Dickman, CEO of Hire Heroes USA, told BI that one of the biggest challenges for people leaving their service is explaining how what they did in the military can be helpful to civilian employers.
Dickman pointed to his own experience flying Apache helicopters during the dozen years he served in the Army.
"No employer really needs a helicopter that puts missiles into other things," he said.
In addition to the obvious differences with civilian life, Dickman said, many members of the military chose to take on additional duties during the spare time they had while serving. That work might not be reflected in vets' records and can be difficult to capture, he said.
"That is where it gets murky and hard for an employer," Dickman said.
Dickman said Hire Heroes USA works to help vets communicate about the skills that they possess. These can range from abilities in manufacturing to prowess in so-called soft skills like conflict resolution and negotiating.
From there, Dickman said, Hire Heroes USA can go to employers and point to the abilities a veteran, service member, or military spouse possesses. Hire Heroes USA recently assisted its 100,000th veteran in the search for civilian employment, Dickman said.
Vets tend to excel, Dickman said, in roles involving consulting, customer service, operations management, logistics, analysis, and project management.
"They have a lot more skills that informed the way that they executed as an infantryman versus just knowing how to use a rifle," Dickman said.
That was the case for Jesse Gartman, 41, who spent four years in the Marine Corps. In 2007, about a year after returning home from Iraq, he responded to an ad on Craigslist looking for movers in New York City. Gartman loved the work and the flexibility it offered. Plus, it was lucrative, and the camaraderie echoed what he'd found in the military.
Some three years later, with his back and shoulders hurting, Gartman decided he had what it takes to run a business. So, he started Veteran Movers NYC, employing mostly former military members. Gartman later sold that business and started another moving company in Oklahoma City, which he still owns. Now, back in New York City, Gartman is also doing business development work for another moving company.
Gartman said that in his case and that of many vets he's worked with, they're "just happy to be alive." He added, "We take a lot of pride in what we do in life."
Helping employers help vets
Trina Clayeux, CEO of Give an Hour, a nonprofit that provides mental health support to veterans and their families, told BI that employers offering affinity groups or employee resource groups for veterans can help ex-military members feel more at home in civilian roles.
Give an Hour also provides training and consulting services for employers on how to best support veterans.
Clayeux said that employers often see veterans in somewhat one-dimensional ways by thinking they're good at getting things done or in leadership roles.
"They have so many other individual skills in between that they've picked up," Clayeux said.
Clayeux said that's why it's important that hiring managers and supervisors should be curious about veterans' experiences and the skills they can bring to a workplace.
A hiring manager's curiosity came through for Bethea, the newly minted Air Force veteran. She recently began a job as a government contractor at the Pentagon. Bethea's new role as a mission readiness airmen analyst builds on her decades of work in the Air Force.
"I enjoy logistics, and I still wanted to do it in my second life," she said.
Read the original article on Business Insider
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