TeleNav 2015 Annual Report Download - page 47

Table of Contents
We generate revenue from advertising network services through the delivery of search and display advertising impressions based on the
specific terms of the advertising contract.
We also generate revenue from subscriptions to our mobile navigation services. End users with subscriptions for our services are generally
billed for our services through their wireless carrier or through mobile application stores and marketplaces. Our wireless carrier customers pay us
based on several different revenue models, including (1) a revenue sharing arrangement that may include a minimum fee per end user, (2) a
monthly or annual subscription fee per end user, or (3) based on usage.
Recent Developments
In April 2015, we entered into an agreement to spin off a product line developed by our Shanghai, China team, including certain assets and
technology as well as the transfer of seven employees, and we agreed to invest $1.0 million
in the form of a convertible note. We are the primary
investor; however, we do not have significant influence over the operations of the business. Accordingly, we record the monthly net change in
operating results against the carrying value of the convertible note recorded in long-term investments on our consolidated balance sheet. Fiscal
2015 includes three months of operating results for the investee entity. The entity's success is contingent upon its ability to generate revenue and
raise additional capital. Based upon the early stage of this company, its lack of success to date in each of these endeavors, and China's recent
unfavorable macroeconomic conditions making the raising of additional capital difficult, we recorded an impairment charge of $0.8 million to
write down the carrying value of the convertible note to zero as of June 30, 2015.
In June 2015, we entered into an agreement to spin off a product line developed by our Xian, China team, including certain assets and
technology as well as the transfer of 12 employees, and we agreed to invest $0.8 million in the form of a convertible note. We are the primary
investor; however, we do not have significant influence over the operations of the business. Accordingly, we record the monthly net change in
operating results against the carrying value of the convertible note recorded in long-term investments on our consolidated balance sheet. Fiscal
2015 includes one month of operating results for the investee entity. The entity's success is contingent upon its ability to generate revenue and
raise additional capital. As of June 30, 2015, our investment balance was $0.7 million .
All information in the following management's discussion and analysis of financial condition and results of operations includes only results
from continuing operations (and excludes our discontinued enterprise business, which was sold in April 2013) for all periods presented, unless
otherwise noted.
Key operating and financial performance metrics
We monitor the key operating and financial performance metrics set forth in the tables below to help us evaluate growth trends, establish
budgets, measure the effectiveness of our sales and marketing efforts and assess our operational efficiencies. Certain of these measures, non-
GAAP income (loss) from continuing operations, net of tax, adjusted earnings before interest, taxes, depreciation and amortization, or adjusted
EBITDA, from continuing operations and diluted non-GAAP income (loss) from continuing operations, net of tax, per share are not measures
calculated in accordance with U.S. generally accepted accounting principles, or GAAP, and should not be considered as an alternative to any
measure of financial performance calculated and presented in accordance with GAAP. In addition, these non-GAAP measures may not be
comparable to similarly titled measures of other companies because other companies may not calculate them in the same manner that we do.
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