Rosetta Stone 2013 Annual Report Download - page 104

Table of Contents
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Summarized quarterly supplemental consolidated financial information for 2013 and 2012 are as follows (in thousands, except per share amounts):
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2013
Revenue
$63,924
$62,139
$60,872
$ 77,710
Gross profit
$53,660
$51,915
$50,128
$63,228
Net loss
$(4,904)
$(3,213)
$(4,169)
$(3,848)
Basic loss per share
$(0.23)
$(0.15)
$(0.19)
$(0.18)
Shares used in basic per share computation
21,360
21,569
21,827
21,353
Diluted loss per share
$(0.23)
$(0.15)
$(0.19)
$(0.18)
Shares used in diluted per share computation
21,360
21,569
21,827
21,353
2012
Revenue
$69,449
$60,812
$64,279
$ 78,701
Gross profit
$55,975
$49,492
$ 53,094
$65,770
Net income (loss)
$(2,003)
$ (4,554)
$(32,063)
$4,635
Basic loss per share
$(0.10)
$(0.22)
$ (1.52)
$0.22
Shares used in basic per share computation
20,942
20,995
21,073
21,166
Diluted loss per share
$(0.10)
$(0.22)
$ (1.52)
$0.21
Shares used in diluted per share computation
20,942
20,995
21,073
21,828
The summarized quarterly supplemental financial information above has been adjusted for the retrospective change in accounting principle for sales
commissions, as disclosed in the Company's financial statements for the quarter ended September 30, 2013.
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On December 19, 2013, the Company executed a Share Purchase Agreement (the “Agreement”) pursuant to which Rosetta Stone Canada Inc., a wholly-
owned, indirect subsidiary of the Company, agreed to purchase all of the outstanding shares of Vivity Labs Inc., a company organized under the laws of
Canada, from its shareholders for $12.0 million in cash. The Agreement contains customary representations, warranties, covenants, indemnification
obligations and closing conditions. The acquisition of Vivity Labs Inc. was completed on January 2, 2014. Based upon the timing of the acquisition
subsequent to the end of the year, the initial accounting for the acquisition is incomplete at this time as the Company is in the process of determining the fair
values of the net assets acquired and goodwill resulting from the acquisition.
On December 11, 2013, Rosetta Stone Inc. the Company executed a Stock Purchase Agreement (the “Agreement”) pursuant to which Rosetta Stone Ltd.,
a wholly-owned subsidiary of the Company, agreed to purchase all of the outstanding shares of Tell Me More S.A., a company organized under the laws of
France, from its shareholders for approximately €20.75 million ($28.0 million), including assumed net debt. The Agreement contains customary
representations, warranties, covenants, indemnification obligations and closing conditions. The acquisition of Tell Me More S.A. was completed on January
8, 2014. Based upon the timing of the acquisition subsequent to the end of the year, the initial accounting for the acquisition is incomplete at this time as the
Company is in the process of determining the fair values of the net assets acquired and goodwill resulting from the acquisition.
On January 10, 2014, Rosetta Stone announced the restructuring of its Asian operations. During the first quarter of 2014, the Company will close its
office in Japan and streamline its operations in South Korea. As a result of these restructuring efforts, Rosetta Stone will reduce its work force by
approximately 70 employees. The Company will maintain its web-based presence in both countries and focus its efforts in South Korea more directly on
further scaling the Proctor Assisted Learning
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