ironSource Results Presentation Deck
Disclaimer (cont.)
Adjusted EBITDA and Adjusted EBITDA Margin
ironSource defines Adjusted EBITDA as income from continuing operations, net of income taxes, as adjusted for income taxes, financial expenses, net and depreciation and
amortization, further adjusted, as applicable, for asset impairments, share-based compensation expense, fair value adjustments related to contingent consideration, acquisition-related
costs and offering costs. ironSource defines Adjusted EBITDA Margin as Adjusted EBITDA calculated as a percentage of revenue. Adjusted EBITDA and Adjusted EBITDA Margin are
included in this presentation because they are key metrics used by management and our board of directors to assess our financial performance. Adjusted EBITDA and Adjusted
EBITDA Margin are frequently used by analysts, investors and other interested parties to evaluate companies in our industry. ironSource management believes that Adjusted EBITDA
and Adjusted EBITDA Margin are appropriate measures of operating performance because each eliminates the impact of expenses that do not relate directly to the performance of the
underlying business.
Adjusted EBITDA and Adjusted EBITDA Margin are non-GAAP measures of our financial performance and should not be considered as alternatives to net income as a measure of
financial performance, as alternatives to cash flows from operations as a measure of liquidity, or as alternatives to any other performance measure derived in accordance with GAAP.
Adjusted EBITDA and Adjusted EBITDA Margin should not be construed as inferences that our future results will be unaffected by unusual or other items. Additionally, Adjusted EBITDA
and Adjusted EBITDA Margin are not intended to be measures of free cash flow for management's discretionary use, as they do not reflect our tax payments and certain other cash
costs that may recur in the future, including, among other things, cash requirements for costs to replace assets being depreciated and amortized. Management compensates for these
limitations by relying on our GAAP results in addition to using Adjusted EBITDA and Adjusted EBITDA Margin as supplemental measures. Our measures of Adjusted EBITDA and
Adjusted EBITDA Margin are not necessarily comparable to similarly titled captions of other companies due to different methods of calculation. For more information on the non-GAAP
financial measures, please see the reconciliation tables provided in the Appendix to this presentation. The accompanying tables have more details on the GAAP financial measures
that are most directly comparable to non-GAAP financial measures and the related reconciliations between these financial measures. The Company has not reconciled its
Adjusted EBITDA guidance to net income because net income is not accessible on a forward-looking basis. Certain items that impact Adjusted EBITDA are out of the Company's
control and/or cannot be reasonably predicted. These items include, but are not limited to, share-based compensation expenses. These items are uncertain, depend on various
factors, and could have a material impact on GAAP reported results for the guidance period. Accordingly, a reconciliation to net income is not available without unreasonable
effort.
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