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Limelight Networks Inc$2.33($.88)(27.41%)

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 Limelight Networks(R) Reports Financial Results for the Fourth Quarter and Full Year of 2015
   Tuesday, February 09, 2016 4:01:00 PM ET

--GAAP EPS of $(0.04), Non-GAAP EPS break-even

--$73.0 million of cash, cash equivalents and marketable securities, up $3.0 million from Q3 2015

--2016 revenue expected to be between $180 and $195 million

Limelight Networks, Inc. (LLNW ) (Limelight), a global leader in digital content delivery, today reported revenue of $42.7 million for the fourth quarter of 2015, up 5 percent, compared to $40.7 million in the fourth quarter of 2014, and up six percent when adjusting for the impact of foreign currency fluctuations.

GAAP gross margins were 41.0% in the fourth quarter of 2015, an increase of 140 basis points from 39.6% in the fourth quarter of 2014, and up 320 basis points from 37.8% in the third quarter of 2015.



On a GAAP basis, Limelight reported a loss from continuing operations of $4.1 million, or $0.04 per basic share, for the fourth quarter of 2015, compared to a loss from continuing operations of $5.0 million, or $0.05 per basic share in the fourth quarter of 2014. Non-GAAP net loss was $0.4 million, or break-even per basic share for the fourth quarter of 2015, compared to a non-GAAP net loss of $2.1 million, or $0.02 per basic share in the fourth quarter of 2014.

EBITDA from continuing operations was $2.1 million for the fourth quarter of 2015, compared to negative $1.2 million for the fourth quarter of 2014. Adjusted EBITDA was $5.3 million for the fourth quarter of 2015 compared to $1.5 million for the fourth quarter of 2014.

For the full year ended December 31, 2015, Limelight reported revenue of $170.9 million compared to $162.3 million for the year ended December 31, 2014. Revenue in 2014 included $11.3 million of revenue from Netflix. Currency fluctuations negatively impacted full year 2015 results by $3.3 million.

GAAP gross margins were 39.9% for the year ended December 31, 2015, compared to 39.1% for the year ended December 31, 2014.

On a GAAP basis, Limelight reported a loss from continuing operations of $24.0 million, or $0.24 per basic share, for the year ended December 31, 2015, compared to a loss from continuing operations of $24.9 million, or $0.25 per basic share, in 2014.

Non-GAAP net loss was $11.2 million, or $0.11 per basic share, for the year ended December 31, 2015, compared to a non-GAAP net loss of $12.3 million, or $0.13 per basic share, in the same period of 2014.

EBITDA from continuing operations was negative $4.8 million for the year ended December 31, 2015, compared to negative $6.5 million for the year ended December 31, 2014. Adjusted EBITDA was $6.9 million for the year ended December 31, 2015, compared to $4.8 million for the year ended December 31, 2014.

Limelight ended the fourth quarter with 509 employees and employee equivalents, down from 556 at the end of the third quarter of 2015, and down from 520 at the end of 2014.

Commenting on the fourth quarter and full year results, Chief Executive Officer, Robert Lento said, "In 2015 we achieved strong operational and financial improvements. Customer Net Promoter Score, customer attrition, network performance, and voluntary employee turnover all saw material improvements. We grew at the top end of the industry ranges, improved our gross margin, and exited the year with a strong quarter. We expect to build on this performance throughout 2016. Our position in the industry remains strong and is improving."

"We believe that years of an intensive, anti-competitive legal battle, has adversely affected our equity value, but we also believe it is our responsibility to defend the interests of our company, our talented employees, and our valued customers against predatory tactics. We will continue to vigorously pursue avenues to eliminate or reduce the potential damages in our longstanding patent fight, while remaining focused on driving business performance that will lead to better alignment between our share price and our view of the company’s equity value."

Based on current conditions, Limelight is providing revenue guidance of between $180 million and $195 million for 2016. GAAP gross margin is expected to improve by 200 basis points over 2015 results. Non-GAAP net loss is expected to be between $(0.05) and $0.05 per share for 2016. Capital expenditures are expected to be approximately $20 million dollars.

Financial Tables

                                                                                                                                       
                                                                                                                                          LIMELIGHT NETWORKS, INC.
                                                                                                                                           CONDENSED CONSOLIDATED
                                                                                                                                               BALANCE SHEETS
                                                                                                                                    (In thousands, except per share data)
                                                                                                                                                                                                                                                           
                                                                                                                                                                                December 31,                                                                                 December 31,
                                                                                                                                                                 2015                                                   2014    
                                                                                                                                                             -------------------- -------- --------------------                                           -------------------- -------- --------------------
                                                                                                                                                                                 (Unaudited)
                                 ASSETS
Current assets:
  Cash and cash equivalents                                                                                                                                                     $   44,680                                                                                   $   57,767
  Marketable securities                                                                                                                                                             28,322                                                                                       35,317
  Accounts receivable, net                                                                                                                                                          26,795                                                                                       22,622
  Income taxes receivable                                                                                                                                                              170                                                                                          237
  Deferred income taxes                                                                                                                                                                 89                                                                                           78
  Prepaid expenses and other current assets                                                                                                                       9,578                                                  9,625  
                                                                                                                                                             -------------------- -------- --------------------                                           -------------------- -------- --------------------
Total current assets                                                                                                                                                               109,634                                                                                      125,646
Property and equipment, net                                                                                                                                                         36,143                                                                                       32,636
Marketable securities, less current portion                                                                                                                                             40                                                                                           40
Deferred income taxes, less current portion                                                                                                                                          1,252                                                                                        1,364
Goodwill                                                                                                                                                                            76,143                                                                                       76,133
Other intangible assets, net                                                                                                                                                            15                                                                                        1,071
Other assets                                                                                                                                                      2,400                                                  4,451  
                                                                                                                                                             -------------------- -------- --------------------                                           -------------------- -------- --------------------
Total assets                                                                                                                                                                    $  225,627                                                                $  241,341  
                                                                                                                                                             ==================== ======== ====================                                           ==================== ======== ====================
                                                                                                                                                                                                                                                           
                  LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
  Accounts payable                                                                                                                                                              $    9,137                                                                                   $    7,065
  Deferred revenue                                                                                                                                                                   2,890                                                                                        3,509
  Capital lease obligations                                                                                                                                                            466                                                                                          223
  Income taxes payable                                                                                                                                                                 204                                                                                          248
  Other current liabilities                                                                                                                                      10,857                                                 14,383  
                                                                                                                                                             -------------------- -------- --------------------                                           -------------------- -------- --------------------
Total current liabilities                                                                                                                                                           23,554                                                                                       25,428
Capital lease obligations, less current portion                                                                                                                                      1,436                                                                                          135
Deferred income taxes                                                                                                                                                                  137                                                                                          170
Deferred revenue, less current portion                                                                                                                                                  92                                                                                          405
Other long-term liabilities                                                                                                                                       2,311                                                  3,040  
                                                                                                                                                             -------------------- -------- --------------------                                           -------------------- -------- --------------------
Total liabilities                                                                                                                                                                   27,530                                                                                       29,178
Commitments and contingencies
Stockholders’ equity:
  Convertible preferred stock, $0.001 par value; 7,500 shares                                                                                                                            -                                                                                            -
  authorized; no shares issued and outstanding
  Common stock, $0.001 par value; 300,000 shares authorized; 102,299
  and 98,409 shares issued and
    outstanding at December 31, 2015 and December 31, 2014, respectively                                                                                                               102                                                                                           98
  Additional paid-in capital                                                                                                                                                       477,202                                                                                      464,294
  Accumulated other comprehensive loss                                                                                                                                             (10,812 )                                                                                     (7,786 )
  Accumulated deficit                                                                                                                                          (268,395 )                                                                (244,443 )
                                                                                                                                                             -------------------- -------- --------------------                                           -------------------- -------- --------------------
Total stockholders’ equity                                                                                                                                      198,097                                                212,163  
                                                                                                                                                             -------------------- -------- --------------------                                           -------------------- -------- --------------------
Total liabilities and stockholders’ equity                                                                                                                                      $  225,627                                                                $  241,341  
                                                                                                                                                             ==================== ======== ====================                                           ==================== ======== ====================
                                                                                                                                                                                                                                                           
                                                                                                                                                                                                                                                                                                                                                             
                                                                                                                                                                                                                                     LIMELIGHT NETWORKS, INC.
                                                                                                                                                                                                                                     CONDENSED CONSOLIDATED
                                                                                                                                                                                                                                     STATEMENTS OF OPERATIONS
                                                                                                                                                                                                                                     (In thousands, except per share
                                                                                                                                                                                                                                     data)
                                                                                                                                                                                                                                     (Unaudited)
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
                                                                                                                                                                                                                                                                   Three Months Ended                                                                                                                                                                                                                                       Twelve Months Ended
                                                                                                                                               ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------                                          -------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
                                                                                                                                                                  December 31,                                                           September 30,                                        Percent                                        December 31,                                         Percent                                                              December 31,                                                           December 31,                                               Percent
                                                                                                                                                   2015                             2015                          Change                          2014                          Change                                                2015                             2014                                Change
                                                                                                                                               -------------------- ------- --------------------                      -------------------- ------- --------------------                      ---------                     -------------------- ------ --------------------                      ---------                                          -------------------- ------- --------------------                      -------------------- ------- --------------------                      ---------------------
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
Revenues                                                                                                                                                          $  42,739                                           $  42,049                           2 %                                           $ 40,727                           5 %                                                                $ 170,912                                           $ 162,259                                 5 %
                                                                                                                                               -------------------- ------- --------------------                      -------------------- ------- --------------------                                                    -------------------- ------ --------------------                                                                         -------------------- ------- --------------------                      -------------------- ------- --------------------
Cost of revenue:
  Cost of services (1)                                                                                                                                               20,388                                                                 21,502                                             -5 %                                             20,613                                             -1 %                                                                   84,818                                                                 82,176                                                    3 %
  Depreciation - network                                                                                                                           4,811                            4,636                           4 %                           3,985                          21 %                                                17,975                           16,673                                 8 %
                                                                                                                                               -------------------- ------- --------------------                      -------------------- ------- --------------------                                                    -------------------- ------ --------------------                                                                         -------------------- ------- --------------------                      -------------------- ------- --------------------
Total cost of revenue                                                                                                                             25,199                           26,138                          -4 %                          24,598                           2 %                                               102,793                           98,849                                 4 %
                                                                                                                                               -------------------- ------- --------------------                      -------------------- ------- --------------------                                                    -------------------- ------ --------------------                                                                         -------------------- ------- --------------------                      -------------------- ------- --------------------
Gross profit                                                                                                                                                         17,540                                                                 15,911                                             10 %                                             16,129                                              9 %                                                                   68,119                                                                 63,410                                                    7 %
Gross profit percentage                                                                                                                                                41.0 %                                                                 37.8 %                                                                                              39.6 %                                                                                                                    39.9 %                                                                 39.1 %
Operating expenses:
  General and administrative (1)                                                                                                                                      5,509                                                                  6,586                                            -16 %                                              6,210                                            -11 %                                                                   25,027                                                                 28,176                                                  -11 %
  Sales and marketing (1)                                                                                                                                             8,101                                                                  9,489                                            -15 %                                              9,103                                            -11 %                                                                   37,868                                                                 37,458                                                    1 %
  Research & development (1)                                                                                                                                          6,678                                                                  7,429                                            -10 %                                              6,014                                             11 %                                                                   28,016                                                                 20,965                                                   34 %
  Depreciation and amortization                                                                                                                    1,005                              648                          55 %                             661                          52 %                                                 2,929                            3,529                               -17 %
                                                                                                                                               -------------------- ------- --------------------                      -------------------- ------- --------------------                                                    -------------------- ------ --------------------                                                                         -------------------- ------- --------------------                      -------------------- ------- --------------------
Total operating expenses                                                                                                                          21,293                           24,152                         -12 %                          21,988                          -3 %                                                93,840                           90,128                                 4 %
                                                                                                                                               -------------------- ------- --------------------                      -------------------- ------- --------------------                                                    -------------------- ------ --------------------                                                                         -------------------- ------- --------------------                      -------------------- ------- --------------------
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
Operating loss                                                                                                                                                       (3,753 )                                                               (8,241 )                                          -54 %                                             (5,859 )                                          -36 %                                                                  (25,721 )                                                              (26,718 )                                                 -4 %
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
Other income (expense):
  Interest expense                                                                                                                                                      (25 )                                                                    -                                            100 %                                                 (6 )                                          317 %                                                                      (29 )                                                                  (32 )                                                 -9 %
  Interest income                                                                                                                                                        86                                                                     82                                              5 %                                                 73                                             18 %                                                                      317                                                                    276                                                   15 %
  Other, net                                                                                                                                        (407 )                                               473                        -186 %                             807                        -150 %                                                 1,748                            1,821                                -4 %
                                                                                                                                               -------------------- ------- --------------------                      -------------------- ------- --------------------                                                    -------------------- ------ --------------------                                                                         -------------------- ------- --------------------                      -------------------- ------- --------------------
Total other income (expense)                                                                                                                        (346 )                                               555                        -162 %                             874                        -140 %                                                 2,036                            2,065                                -1 %
                                                                                                                                               -------------------- ------- --------------------                      -------------------- ------- --------------------                                                    -------------------- ------ --------------------                                                                         -------------------- ------- --------------------                      -------------------- ------- --------------------
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
Loss from continuing operations before income taxes                                                                                                                  (4,099 )                                                               (7,686 )                                          -47 %                                             (4,985 )                                          -18 %                                                                  (23,685 )                                                              (24,653 )                                                 -4 %
Income tax expense                                                                                                                                    46                               76                         -39 %                              22                         109 %                                                   267                              203                                32 %
                                                                                                                                               -------------------- ------- --------------------                      -------------------- ------- --------------------                                                    -------------------- ------ --------------------                                                                         -------------------- ------- --------------------                      -------------------- ------- --------------------
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
Loss from continuing operations                                                                                                                                      (4,145 )                                                               (7,762 )                                          -47 %                                             (5,007 )                                          -17 %                                                                  (23,952 )                                                              (24,856 )                                                 -4 %
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
Discontinued operations:
  Income from discontinued operations, net of income taxes                                                                                             -                                -                           NA                                -                           NA                                                      -                              265                                 NA
                                                                                                                                               -------------------- ------- --------------------                      -------------------- ------- --------------------                                                    -------------------- ------ --------------------                                                                         -------------------- ------- --------------------                      -------------------- ------- --------------------
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
Net loss                                                                                                                                                          $  (4,145 )                                                            $  (7,762 )                                          -47 %                                           $ (5,007 )                                          -17 %                                                                $ (23,952 )                                                            $ (24,591 )                                                 -3 %
                                                                                                                                               ==================== ======= ====================                      ==================== ======= ====================                                                    ==================== ====== ====================                                                                         ==================== ======= ====================                      ==================== ======= ====================
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
Net loss per share:
    Basic and diluted
      Continuing operations                                                                                                                                       $   (0.04 )                                                            $   (0.08 )                                                                                          $  (0.05 )                                                                                                               $   (0.24 )                                                            $   (0.25 )
      Discontinued operations                                                                                                                          -                                -                                                             -                                                                                   -                             0.00  
                                                                                                                                               -------------------- ------- --------------------                      -------------------- ------- --------------------                                                    -------------------- ------ --------------------                                                                         -------------------- ------- --------------------                      -------------------- ------- --------------------
Total                                                                                                                                                             $   (0.04 )                                                            $   (0.08 )                                                                                          $  (0.05 )                                                                                                               $   (0.24 )                                                            $   (0.25 )
                                                                                                                                               ==================== ======= ====================                      ==================== ======= ====================                                                    ==================== ====== ====================                                                                         ==================== ======= ====================                      ==================== ======= ====================
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
Weighted average shares used in per share calculation:
  Basic and diluted                                                                                                                                                 101,391                                                                100,552                                                                                              98,637                                                                                                                   100,105                                                                 98,365
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
(1) Includes share-based compensation (see supplemental table for
figures)
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
                                                                                                                                                                                                                                                                  
                                                                                                                                                                                                                                    LIMELIGHT NETWORKS, INC.
                                                                                                                                                                                                                                   SUPPLEMENTAL FINANCIAL DATA
                                                                                                                                                                                                                                     (In
                                                                                                                                                                                                                                     thousands)
                                                                                                                                                                                                                                     (Unaudited)
                                                                                                                                                                                                                                                                                                                                                                                                                                               
                                                                                                                                                                                                                                                                                                                                                                                                                                               
                                                                                                                                                                                                                                Three Months Ended                                                                                                                                                                        Twelve Months Ended
                                                                                                                                                     ------------------------------------------------------------------------------------------------------------------------------------------------------------------------                                          -------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                                                                                                                                                                                                                                                                                                               
                                                                                                                                                             December 31,                                               September 30,                                                         December 31,                                                                                December 31,                                                           December 31,
                                                                                                                                                                 2015                                    2015                            2014                                                  2015                             2014   
                                                                                                                                                     ----------------------------                     -------------------- ------ --------------------                      -------------------- ------ --------------------                                           -------------------- ------- --------------------                      -------------------- ------- --------------------
                                                                                                                                                                                                                                                                                                                                                                                                                                               
                                                                                                                                                                                                                                                                                                                                                                                                                                               
Share-based compensation:
                                                                                                                                                                                                                                                                                                                                                                                                                                               
Cost of services                                                                                                                                                        $    563                                         $    400                                                              $    490                                                                                   $   2,047                                                              $   1,956
General and administrative                                                                                                                                                 1,002                                            1,513                                                                 1,202                                                                                       5,398                                                                  4,741
Sales and marketing                                                                                                                                                          716                                              643                                                                   624                                                                                       2,657                                                                  2,317
Research and development                                                                                                                                  582                           568                             375                                                 2,236                            1,477  
                                                                                                                                                     -------------------- ------                      -------------------- ------ --------------------                      -------------------- ------ --------------------                                           -------------------- ------- --------------------                      -------------------- ------- --------------------
                                                                                                                                                                                                                                                                                                                                                                                                                                               
Total share-based compensation                                                                                                                                          $  2,863                                         $  3,124                                           $  2,691                                                                $  12,338                                           $  10,491  
                                                                                                                                                     ==================== ======                      ==================== ====== ====================                      ==================== ====== ====================                                           ==================== ======= ====================                      ==================== ======= ====================
                                                                                                                                                                                                                                                                                                                                                                                                                                               
Depreciation and amortization:
                                                                                                                                                                                                                                                                                                                                                                                                                                               
Network-related depreciation                                                                                                                                            $  4,811                                         $  4,636                                                              $  3,985                                                                                   $  17,975                                                              $  16,673
Other depreciation and amortization                                                                                                                                          544                                              445                                                                   457                                                                                       1,866                                                                  2,391
Amortization of intangible assets                                                                                                                         461                           203                             204                                                 1,063                            1,138  
                                                                                                                                                     -------------------- ------                      -------------------- ------ --------------------                      -------------------- ------ --------------------                                           -------------------- ------- --------------------                      -------------------- ------- --------------------
                                                                                                                                                                                                                                                                                                                                                                                                                                               
Total depreciation and amortization                                                                                                                                     $  5,816                                         $  5,284                                           $  4,646                                                                $  20,904                                           $  20,202  
                                                                                                                                                     ==================== ======                      ==================== ====== ====================                      ==================== ====== ====================                                           ==================== ======= ====================                      ==================== ======= ====================
                                                                                                                                                                                                                                                                                                                                                                                                                                               
                                                                                                                                                                                                                                                                                                                                                                                                                                               
Net increase (decrease) in cash, cash equivalents and marketable                                                                                                        $  3,427                                         $ (5,342 )                                                            $ (8,172 )                                                                                 $ (20,082 )                                                            $ (25,384 )
securities:
                                                                                                                                                     ==================== ======                      ==================== ====== ====================                      ==================== ====== ====================                                           ==================== ======= ====================                      ==================== ======= ====================
                                                                                                                                                                                                                                                                                                                                                                                                                                               
                                                                                                                                                                                                                                                                                                                                                                                                                                               
End of period statistics:
                                                                                                                                                                                                                                                                                                                                                                                                                                               
Approximate number of active customers                                                                                                                                       963                                              981                                                                 1,095                                                                                         963                                                                  1,095
                                                                                                                                                                                                                                                                                                                                                                                                                                               
Number of employees and employee equivalents                                                                                                                                 509                                              556                                                                   520                                                                                         509                                                                    520
                                                                                                                                                                                                                                                                                                                                                                                                                                               
                                                                                                                                                                                                                                                                                                                                              
                                                                                                                                                                                                                                     LIMELIGHT NETWORKS, INC.
                                                                                                                                                                                                                                     CONDENSED CONSOLIDATED
                                                                                                                                                                                                                                     STATEMENTS OF CASH FLOWS
                                                                                                                                                                                                                                     (In thousands)
                                                                                                                                                                                                                                     (Unaudited)
   
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
                                                                                                                                                                                                                                                                                                 Three Months Ended                                                                                                                                                                                   Twelve Months Ended
                                                                                                                                                                                                            ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------                                          -------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
                                                                                                                                                                                                                              December 31,                                                          September 30,                                                         December 31,                                                                                December 31,                                                           December 31,
                                                                                                                                                                                                               2015                            2015                            2014                                                  2015                             2014   
                                                                                                                                                                                                            -------------------- ------ --------------------                      -------------------- ------ --------------------                      -------------------- ------ --------------------                                           -------------------- ------- --------------------                      -------------------- ------- --------------------
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
Operating activities
                     Net loss                                                                                                                                                                                                  $ (4,145 )                                                            $ (7,762 )                                                            $ (5,007 )                                                                                 $ (23,952 )                                                            $ (24,591 )
                     Income from discontinued operations                                                                                                                                                           -                               -                               -                                                     -                              265  
                                                                                                                                                                                                            -------------------- ------ --------------------                      -------------------- ------ --------------------                      -------------------- ------ --------------------                                           -------------------- ------- --------------------                      -------------------- ------- --------------------
                     Net loss from continuing operations                                                                                                                                                                         (4,145 )                                                              (7,762 )                                                              (5,007 )                                                                                   (23,952 )                                                              (24,856 )
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
                     Adjustments to reconcile net loss to net cash provided by (used in)
                     operating activities of continuing operations:
                                                       Depreciation and amortization                                                                                                                                              5,816                                                                 5,284                                                                 4,646                                                                                      20,904                                                                 20,202
                                                       Share-based compensation                                                                                                                                                   2,863                                                                 3,124                                                                 2,691                                                                                      12,338                                                                 10,491
                                                       Foreign currency remeasurement loss (gain)                                                                                                                                   492                                                                  (488 )                                                              (1,100 )                                                                                    (1,591 )                                                               (2,167 )
                                                       Deferred income taxes                                                                                                                                                         67                                                                    94                                                                  (174 )                                                                                        46                                                                   (359 )
                                                       Accounts receivable charges                                                                                                                                                  299                                                                   268                                                                   (75 )                                                                                     1,037                                                                    408
                                                       Amortization of premium on marketable securities                                                                                                                              42                                                                    46                                                                    85                                                                                         194                                                                    459
                                                       Non cash tax benefit associated with income from discontinued                                                                                                                  -                                                                     -                                                                     -                                                                                           -                                                                    (59 )
                                                       operations
                                                       Changes in operating assets and liabilities:
                                                         Accounts receivable                                                                                                                                                         57                                                                 4,025                                                                  (104 )                                                                                    (5,210 )                                                               (1,600 )
                                                         Prepaid expenses and other current assets                                                                                                                                 (490 )                                                                 498                                                                  (747 )                                                                                      (194 )                                                               (1,792 )
                                                         Income taxes receivable                                                                                                                                                      9                                                                    24                                                                    95                                                                                          44                                                                    150
                                                         Other assets                                                                                                                                                             1,477                                                                   578                                                                   616                                                                                       3,064                                                                  1,607
                                                         Accounts payable and other current liabilities                                                                                                                            (425 )                                                              (1,156 )                                                                (977 )                                                                                        85                                                                    122
                                                         Deferred revenue                                                                                                                                                          (681 )                                                                (568 )                                                                (216 )                                                                                      (932 )                                                               (1,109 )
                                                         Income taxes payable                                                                                                                                                        (2 )                                                                 (78 )                                                                 (19 )                                                                                       (80 )                                                                 (233 )
                                                         Other long term liabilities                                                                                                                           1,358                            (225 )                                             (251 )                                                                    688                             (796 )
                                                                                                                                                                                                            -------------------- ------ --------------------                      -------------------- ------ --------------------                      -------------------- ------ --------------------                                           -------------------- ------- --------------------                      -------------------- ------- --------------------
                     Net cash provided by (used in) operating activities of continuing                                                                                                                         6,737                           3,664                            (537 )                                                                  6,441                              468  
                     operations
                                                                                                                                                                                                            -------------------- ------ --------------------                      -------------------- ------ --------------------                      -------------------- ------ --------------------                                           -------------------- ------- --------------------                      -------------------- ------- --------------------
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
Investing activities
                                                       Purchases of marketable securities                                                                                                                                             -                                                                (4,899 )                                                              (7,813 )                                                                                   (16,821 )                                                              (25,482 )
                                                       Maturities of marketable securities                                                                                                                                        5,700                                                                 5,160                                                                 6,600                                                                                      22,620                                                                 22,150
                                                       Purchases of property and equipment                                                                                                                                       (3,960 )                                                              (8,693 )                                                              (4,597 )                                                                                   (24,714 )                                                              (18,581 )
                                                       Proceeds from sale of discontinued operations                                                                                                               -                               -                               -                                                     -                              414  
                                                                                                                                                                                                            -------------------- ------ --------------------                      -------------------- ------ --------------------                      -------------------- ------ --------------------                                           -------------------- ------- --------------------                      -------------------- ------- --------------------
                     Net cash provided by (used in) investing activities of continuing                                                                                                                         1,740                          (8,432 )                                           (5,810 )                                                                (18,915 )                                           (21,499 )
                     operations
                                                                                                                                                                                                            -------------------- ------ --------------------                      -------------------- ------ --------------------                      -------------------- ------ --------------------                                           -------------------- ------- --------------------                      -------------------- ------- --------------------
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
Financing activities
                                                       Payments on capital lease obligations                                                                                                                                        (95 )                                                                   -                                                                   (54 )                                                                                      (453 )                                                                 (466 )
                                                       Payment of employee tax withholdings related to restricted stock                                                                                                            (348 )                                                                (335 )                                                                (340 )                                                                                    (2,627 )                                                               (1,795 )
                                                       vesting
                                                       Cash paid for purchase of common stock                                                                                                                                         -                                                                     -                                                                (2,042 )                                                                                      (957 )                                                               (4,542 )
                                                       Proceeds from line of credit                                                                                                                                                   -                                                                     -                                                                     -                                                                                           -                                                                      -
                                                       Proceeds from employee stock plans                                                                                                                      1,287                             212                             414                                                 4,018                            1,381  
                                                                                                                                                                                                            -------------------- ------ --------------------                      -------------------- ------ --------------------                      -------------------- ------ --------------------                                           -------------------- ------- --------------------                      -------------------- ------- --------------------
                     Net cash provided by (used in) financing activities of continuing                                                                                                                           844                            (123 )                                           (2,022 )                                                                    (19 )                                            (5,422 )
                     operations
                                                                                                                                                                                                            -------------------- ------ --------------------                      -------------------- ------ --------------------                      -------------------- ------ --------------------                                           -------------------- ------- --------------------                      -------------------- ------- --------------------
                     Effect of exchange rate changes on cash and cash equivalents                                                                                                                                (93 )                                             (159 )                                             (892 )                                                                   (594 )                                            (1,732 )
                                                                                                                                                                                                            -------------------- ------ --------------------                      -------------------- ------ --------------------                      -------------------- ------ --------------------                                           -------------------- ------- --------------------                      -------------------- ------- --------------------
Discontinued operations
                                                       Cash used in operating activities of discontinued operations                                                                                                -                               -                               -                                                     -                               (4 )
                                                                                                                                                                                                            -------------------- ------ --------------------                      -------------------- ------ --------------------                      -------------------- ------ --------------------                                           -------------------- ------- --------------------                      -------------------- ------- --------------------
Net increase (decrease) in cash and cash equivalents                                                                                                                                                                              9,228                                                                (5,050 )                                                              (9,261 )                                                                                   (13,087 )                                                              (28,189 )
Cash and cash equivalents, beginning of period                                                                                                                                                                35,452                          40,502                          67,028                                                57,767                           85,956  
                                                                                                                                                                                                            -------------------- ------ --------------------                      -------------------- ------ --------------------                      -------------------- ------ --------------------                                           -------------------- ------- --------------------                      -------------------- ------- --------------------
Cash and cash equivalents, end of period                                                                                                                                                                                       $ 44,680                                           $ 35,452                                           $ 57,767                                                                $  44,680                                           $  57,767  
                                                                                                                                                                                                            ==================== ====== ====================                      ==================== ====== ====================                      ==================== ====== ====================                                           ==================== ======= ====================                      ==================== ======= ====================
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           

Use of Non-GAAP Financial Measures

To evaluate our business, we consider and use non-generally accepted accounting principles (Non-GAAP) net loss, EBITDA from continuing operations and Adjusted EBITDA as supplemental measures of operating performance. These measures include the same adjustments that management takes into account when it reviews and assesses operating performance on a period-to-period basis. We consider Non-GAAP net loss to be an important indicator of overall business performance. We define Non-GAAP net loss to be U.S. GAAP net loss, adjusted to exclude share-based compensation, litigation expenses, amortization of intangible assets, the gain (loss) on sale of our web content management (WCM) business and discontinued operations. We believe that EBITDA from continuing operations provides a useful metric to investors to compare us with other companies within our industry and across industries. We define EBITDA from continuing operations as U.S. GAAP net loss adjusted to exclude interest and other (income) expense, interest expense, income tax expense, depreciation and amortization, discontinued operations and gain (loss) on sale of WCM. We define Adjusted EBITDA as EBITDA from continuing operations adjusted to exclude share-based compensation and litigation expenses. We use Adjusted EBITDA as a supplemental measure to review and assess operating performance. We also believe use of Adjusted EBITDA facilitates investors’ use of operating performance comparisons from period-to-period, as well as across companies.

The terms Non-GAAP net loss, EBITDA from continuing operations and Adjusted EBITDA are not defined under U.S. GAAP, and are not measures of operating income, operating performance or liquidity presented in accordance with U.S. GAAP. Our Non-GAAP net loss, EBITDA from continuing operations and Adjusted EBITDA have limitations as analytical tools, and when assessing our operating performance, Non-GAAP net loss, EBITDA from continuing operations and Adjusted EBITDA should not be considered in isolation, or as a substitute for net loss or other consolidated income statement data prepared in accordance with U.S. GAAP. Some of these limitations include, but are not limited to:

-- EBITDA from continuing operations and Adjusted EBITDA do not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments;

-- these measures do not reflect changes in, or cash requirements for, our working capital needs;

-- these measures do not reflect the cash requirements necessary for litigation costs;

-- these measures do not reflect the interest expense, or the cash requirements necessary to service interest or principal payments, on our debt that we may incur;

-- these measures do not reflect income taxes or the cash requirements for any tax payments;

-- although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will be replaced sometime in the future, and EBITDA from continuing operations and Adjusted EBITDA do not reflect any cash requirements for such replacements;

-- while share-based compensation is a component of operating expense, the impact on our financial statements compared to other companies can vary significantly due to such factors as the assumed life of the options and the assumed volatility of our common stock; and

-- other companies may calculate EBITDA from continuing operations and Adjusted EBITDA differently than we do, limiting their usefulness as comparative measures.

We compensate for these limitations by relying primarily on our U.S. GAAP results and using Non-GAAP net income (loss), EBITDA from continuing operations, and Adjusted EBITDA only as supplemental support for management’s analysis of business performance. Non-GAAP net income (loss), EBITDA from continuing operations and Adjusted EBITDA are calculated as follows for the periods presented in thousands:

Reconciliation of Non-GAAP Financial Measures

Limelight is presenting the most directly comparable U.S. GAAP financial measures and reconciling the non-GAAP financial metrics to the comparable U.S. GAAP measures. Per share amounts may not foot due to rounding.

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
                                                                                                                                                                                                                                     LIMELIGHT NETWORKS, INC.
                                                                                                                                                                                                                                     Reconciliation of U.S. GAAP
                                                                                                                                                                                                                                     Net Loss to Non-GAAP Net Loss
                                                                                                                                                                                                                                     (In thousands)
                                                                                                                                                                                                                                     (Unaudited)
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
                                                                                                                                                                                                                                                                                                                                                              Three Months Ended                                                                                                                                                                                                                                                                                                                                                                                                                           Twelve Months Ended
                                                                                                                                          ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------                                                                                    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
                                                                                                                                                                                              December 31, 2015                                                                                                                                                September 30, 2015                                                                                                                                                December 31, 2014                                                                                                                                                                                           December 31, 2015                                                                                                                               December 31, 2014
                                                                                                                                          ------------------------------------------------------------------------------------------------------------------------                                          ------------------------------------------------------------------------------------------------------------------------                                          -----------------------------------------------------------------------------------------------------------------------                                                                                    -------------------------------------------------------------------------------------------------------------------------                                          -----------------------------------------------------------------------------------
                                                                                                                                                               Amount                                                                Per Share                                                                                   Amount                                                                Per Share                                                                                   Amount                                                               Per Share                                                                                                                              Amount                                                                Per Share                                                                           Amount                                             Per Share
                                                                                                                                          -------------------------------------------------                     --------------------------------------------------                                          -------------------------------------------------                     --------------------------------------------------                                          -------------------------------------------------                     -------------------------------------------------                                                                                    --------------------------------------------------                     --------------------------------------------------                                          --------------------------------                     ------------------------------
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
U.S. GAAP net loss                                                                                                                                           $ (4,145 )                                                            $   (0.04 )                                                                                 $ (7,762 )                                                            $   (0.08 )                                                                                 $ (5,007 )                                                            $  (0.05 )                                                                                                                           $ (23,952 )                                                            $   (0.24 )                                                                                 $ (24,591 )                                          $  (0.25 )
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
Share-based compensation                                                                                                                                        2,863                                                                   0.03                                                                                      3,124                                                                   0.03                                                                                      2,691                                                                  0.03                                                                                                                                12,338                                                                   0.12                                                                                      10,491                                                0.11
Litigation expenses                                                                                                                                               402                                                                   0.00                                                                                        140                                                                   0.00                                                                                         (3 )                                                               (0.00 )                                                                                                                                (613 )                                                                (0.01 )                                                                                       817                                                0.01
Amortization of intangible assets                                                                                                                                 461                                                                   0.00                                                                                        203                                                                   0.00                                                                                        204                                                                  0.00                                                                                                                                 1,063                                                                   0.01                                                                                       1,138                                                0.01
Loss on sale of the Web Content Management business                                                                                                                 -                                                                      -                                                                                          -                                                                      -                                                                                          -                                                                     -                                                                                                                                     -                                                                      -                                                                                          62                                                0.00
(Loss) income from discontinued operations                                                                                                       -                                -                                                    -                                -                                                    -                               -                                                                                               -                                -                                                  (265 )                          (0.00 )
                                                                                                                                          -------------------- ------ --------------------                      -------------------- ------- --------------------                                           -------------------- ------ --------------------                      -------------------- ------- --------------------                                           -------------------- ------ --------------------                      -------------------- ------ --------------------                                                                                     -------------------- ------- --------------------                      -------------------- ------- --------------------                                           -------------------- ------- --                      -------------------- ------ -
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
Non-GAAP net loss                                                                                                                                            $   (419 )                                                            $   (0.00 )                                                                                 $ (4,295 )                                                            $   (0.04 )                                                                                 $ (2,115 )                                                            $  (0.02 )                                                                                                                           $ (11,164 )                                                            $   (0.11 )                                                                                 $ (12,348 )                                          $  (0.13 )
                                                                                                                                          ==================== ====== ====================                      ==================== ======= ====================                                           ==================== ====== ====================                      ==================== ======= ====================                                           ==================== ====== ====================                      ==================== ====== ====================                                                                                     ==================== ======= ====================                      ==================== ======= ====================                                           ==================== ======= ==                      ==================== ====== =
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
Weighted average shares used in per share calculation                                                                                                                                                                                101,391                                                                                                                                                           100,552                                                                                                                                                           98,637                                                                                                                                                                                                      100,105                                                                                                                                          98,365
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
                                                                                                                                                                                                                                                                                         
                                                                                                                                                                                                                   LIMELIGHT NETWORKS, INC.
                                                                                                                                                                                                                  Reconciliation of U.S. GAAP
                                                                                                                                                                                                             Net Loss to EBITDA to Adjusted EBITDA
                                                                                                                                                                                                                        (In thousands)
                                                                                                                                                                                                                          (Unaudited)
 
                                                                                                                                                                                                                                                                                                                                                                                                             
                                                                                                                                                                                   Three Months Ended                                                                                                                                                                                   Twelve Months Ended
                                                                                              ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------                                          -------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                                                                                                                                                                                                                                                                             
                                                                                                                December 31,                                                          September 30,                                                         December 31,                                                                                December 31,                                                           December 31,
                                                                                                 2015                            2015                            2014                                                  2015                             2014   
                                                                                              -------------------- ------ --------------------                      -------------------- ------ --------------------                      -------------------- ------ --------------------                                           -------------------- ------- --------------------                      -------------------- ------- --------------------
                                                                                                                                                                                                                                                                                                                                                                                                             
U.S. GAAP net loss                                                                                               $ (4,145 )                                                            $ (7,762 )                                                            $ (5,007 )                                                                                 $ (23,952 )                                                            $ (24,591 )
                                                                                                                                                                                                                                                                                                                                                                                                             
                     Depreciation and amortization                                                                  5,816                                                                 5,284                                                                 4,646                                                                                      20,904                                                                 20,202
                     Interest expense                                                                                  25                                                                     -                                                                     6                                                                                          29                                                                     32
                     Loss on sale of the Web Content Management business                                                -                                                                     -                                                                     -                                                                                           -                                                                     62
                     Interest and other expense (income)                                                              321                                                                  (555 )                                                                (880 )                                                                                    (2,065 )                                                               (2,159 )
                     Income tax expense                                                                                46                                                                    76                                                                    22                                                                                         267                                                                    203
                     (Loss) income from discontinued operations                                      -                               -                               -                                                     -                             (265 )
                                                                                              -------------------- ------ --------------------                      -------------------- ------ --------------------                      -------------------- ------ --------------------                                           -------------------- ------- --------------------                      -------------------- ------- --------------------
                                                                                                                                                                                                                                                                                                                                                                                                             
EBITDA from continuing operations                                                                                $  2,063                                                              $ (2,957 )                                                            $ (1,213 )                                                                                 $  (4,817 )                                                            $  (6,516 )
                                                                                                                                                                                                                                                                                                                                                                                                             
                     Share-based compensation                                                                       2,863                                                                 3,124                                                                 2,691                                                                                      12,338                                                                 10,491
                     Litigation expenses                                                           402                             140                              (3 )                                                                   (613 )                                               817  
                                                                                              -------------------- ------ --------------------                      -------------------- ------ --------------------                      -------------------- ------ --------------------                                           -------------------- ------- --------------------                      -------------------- ------- --------------------
                                                                                                                                                                                                                                                                                                                                                                                                             
Adjusted EBITDA                                                                                                  $  5,328                                           $    307                                           $  1,475                                                                $   6,908                                           $   4,792  
                                                                                              ==================== ====== ====================                      ==================== ====== ====================                      ==================== ====== ====================                                           ==================== ======= ====================                      ==================== ======= ====================
                                                                                                                                                                                                                                                                                                                                                                                                             

Conference Call

At approximately 4:30 p.m. EST (1:30 p.m. PST) today, management will host a quarterly conference call for investors. Investors can access this call toll-free at 877-388-8480 within the United States or +1 678-809-1592 outside of the U.S. The conference call will also be audiocast live from http://www.limelight.com and a replay will be available following the call from the Limelight website.

Forward-Looking Statements

This press release contains forward-looking statements that involve risks and uncertainties. These statements include, among others, statements regarding our strategic focus; our expectations regarding revenues for the full year 2016; gross margin, non-GAAP net income (loss) and capital expenditures for the full year 2016; the growth of our business; the performance of our services; our expectations regarding the Akamai litigation; our future prospects; and our position in our industry. Our expectations and beliefs regarding these matters may not materialize. The potential risks and uncertainties that could cause actual results or outcomes to differ materially from the results or outcomes predicted include, among other things, reduction of demand for our services from new or existing customers, unforeseen changes in our hiring patterns, adverse outcomes in litigation, and experiencing expenses that exceed our expectations. A detailed discussion of these factors and other risks that affect our business is contained in our SEC filings, including our most recent reports on Forms 10-K and 10-Q, particularly under the heading "Risk Factors." Copies of these filings are available online on our investor relations website at investors.limelightnetworks.com and on the SEC website at www.SEC.gov. All information provided in this release and in the attachments is as of February 9, 2016, and we undertake no duty to update this information in light of new information or future events, unless required by law.

About Limelight

Limelight Networks (LLNW ), a global leader in digital content delivery, empowers customers to better engage online audiences by enabling them to securely manage and globally deliver digital content, on any device. The company’s award winning Limelight Orchestrate(TM) platform includes an integrated suite of content delivery technology and services that helps organizations secure digital content, deliver exceptional multi-screen experiences, improve brand awareness, drive revenue, and enhance customer relationships -- all while reducing costs. For more information, please visit www.limelight.com, read our blog, follow us on Twitter, Facebook and LinkedIn and be sure to visit Limelight Connect."

Copyright (C) 2015 Limelight Networks, Inc. All rights reserved. All product or service names are the property of their respective owners.

http://cts.businesswire.com/ct/CT?id=bwnews&sty=20160209006503r1&sid=cmtx6&distro=nx&lang=en

View source version on businesswire.com: http://www.businesswire.com/news/home/20160209006503/en/

SOURCE: Limelight Networks

Limelight Networks, Inc. 
Sajid Malhotra, 602-850-5778 
ir@llnw.com


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