10-Q 1 vmeo-20240630.htm 10-Q vmeo-20240630
000183768612/312024Q2falsehttp://fasb.org/us-gaap/2024#AccruedLiabilitiesCurrenthttp://fasb.org/us-gaap/2024#AccruedLiabilitiesCurrenthttp://fasb.org/us-gaap/2024#AccruedLiabilitiesCurrenthttp://fasb.org/us-gaap/2024#AccruedLiabilitiesCurrenthttp://fasb.org/us-gaap/2024#AccruedLiabilitiesCurrenthttp://fasb.org/us-gaap/2024#AccruedLiabilitiesCurrenthttp://fasb.org/us-gaap/2024#AccruedLiabilitiesCurrenthttp://fasb.org/us-gaap/2024#OtherLiabilitiesNoncurrenthttp://fasb.org/us-gaap/2024#OtherLiabilitiesNoncurrenthttp://fasb.org/us-gaap/2024#CostOfGoodsAndServicesSoldhttp://fasb.org/us-gaap/2024#CostOfGoodsAndServicesSoldhttp://fasb.org/us-gaap/2024#ResearchAndDevelopmentExpensehttp://fasb.org/us-gaap/2024#ResearchAndDevelopmentExpensehttp://fasb.org/us-gaap/2024#SellingAndMarketingExpensehttp://fasb.org/us-gaap/2024#SellingAndMarketingExpensehttp://fasb.org/us-gaap/2024#GeneralAndAdministrativeExpensehttp://fasb.org/us-gaap/2024#GeneralAndAdministrativeExpensehttp://fasb.org/us-gaap/2024#AccruedLiabilitiesCurrenthttp://fasb.org/us-gaap/2024#AccruedLiabilitiesCurrentxbrli:sharesiso4217:USDiso4217:USDxbrli:sharesxbrli:purevmeo:votevmeo:lawsuitvmeo:videoiso4217:EUR00018376862024-01-012024-06-300001837686us-gaap:CommonClassAMember2024-08-010001837686us-gaap:CommonClassBMember2024-08-0100018376862024-06-3000018376862023-12-310001837686us-gaap:CommonClassAMember2023-12-310001837686us-gaap:CommonClassAMember2024-06-300001837686us-gaap:CommonClassBMember2023-12-310001837686us-gaap:CommonClassBMember2024-06-3000018376862024-04-012024-06-3000018376862023-04-012023-06-3000018376862023-01-012023-06-300001837686us-gaap:CostOfSalesMember2024-04-012024-06-300001837686us-gaap:CostOfSalesMember2023-04-012023-06-300001837686us-gaap:CostOfSalesMember2024-01-012024-06-300001837686us-gaap:CostOfSalesMember2023-01-012023-06-300001837686us-gaap:ResearchAndDevelopmentExpenseMember2024-04-012024-06-300001837686us-gaap:ResearchAndDevelopmentExpenseMember2023-04-012023-06-300001837686us-gaap:ResearchAndDevelopmentExpenseMember2024-01-012024-06-300001837686us-gaap:ResearchAndDevelopmentExpenseMember2023-01-012023-06-300001837686us-gaap:SellingAndMarketingExpenseMember2024-04-012024-06-300001837686us-gaap:SellingAndMarketingExpenseMember2023-04-012023-06-300001837686us-gaap:SellingAndMarketingExpenseMember2024-01-012024-06-300001837686us-gaap:SellingAndMarketingExpenseMember2023-01-012023-06-300001837686us-gaap:GeneralAndAdministrativeExpenseMember2024-04-012024-06-300001837686us-gaap:GeneralAndAdministrativeExpenseMember2023-04-012023-06-300001837686us-gaap:GeneralAndAdministrativeExpenseMember2024-01-012024-06-300001837686us-gaap:GeneralAndAdministrativeExpenseMember2023-01-012023-06-300001837686us-gaap:CommonStockMemberus-gaap:CommonClassAMember2024-03-310001837686us-gaap:CommonStockMemberus-gaap:CommonClassBMember2024-03-310001837686us-gaap:AdditionalPaidInCapitalMember2024-03-310001837686us-gaap:RetainedEarningsMember2024-03-310001837686us-gaap:AccumulatedOtherComprehensiveIncomeMember2024-03-310001837686us-gaap:TreasuryStockCommonMember2024-03-3100018376862024-03-310001837686us-gaap:RetainedEarningsMember2024-04-012024-06-300001837686us-gaap:AccumulatedOtherComprehensiveIncomeMember2024-04-012024-06-300001837686us-gaap:AdditionalPaidInCapitalMember2024-04-012024-06-300001837686us-gaap:CommonStockMemberus-gaap:CommonClassAMember2024-04-012024-06-300001837686us-gaap:TreasuryStockCommonMember2024-04-012024-06-300001837686us-gaap:CommonStockMemberus-gaap:CommonClassAMember2024-06-300001837686us-gaap:CommonStockMemberus-gaap:CommonClassBMember2024-06-300001837686us-gaap:AdditionalPaidInCapitalMember2024-06-300001837686us-gaap:RetainedEarningsMember2024-06-300001837686us-gaap:AccumulatedOtherComprehensiveIncomeMember2024-06-300001837686us-gaap:TreasuryStockCommonMember2024-06-300001837686us-gaap:CommonStockMemberus-gaap:CommonClassAMember2023-12-310001837686us-gaap:CommonStockMemberus-gaap:CommonClassBMember2023-12-310001837686us-gaap:AdditionalPaidInCapitalMember2023-12-310001837686us-gaap:RetainedEarningsMember2023-12-310001837686us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-12-310001837686us-gaap:TreasuryStockCommonMember2023-12-310001837686us-gaap:RetainedEarningsMember2024-01-012024-06-300001837686us-gaap:AccumulatedOtherComprehensiveIncomeMember2024-01-012024-06-300001837686us-gaap:AdditionalPaidInCapitalMember2024-01-012024-06-300001837686us-gaap:CommonStockMemberus-gaap:CommonClassAMember2024-01-012024-06-300001837686us-gaap:TreasuryStockCommonMember2024-01-012024-06-300001837686us-gaap:CommonClassAMember2023-06-300001837686us-gaap:CommonClassBMember2023-06-300001837686us-gaap:CommonStockMemberus-gaap:CommonClassAMember2023-03-310001837686us-gaap:CommonStockMemberus-gaap:CommonClassBMember2023-03-310001837686us-gaap:AdditionalPaidInCapitalMember2023-03-310001837686us-gaap:RetainedEarningsMember2023-03-310001837686us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-03-3100018376862023-03-310001837686us-gaap:RetainedEarningsMember2023-04-012023-06-300001837686us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-04-012023-06-300001837686us-gaap:AdditionalPaidInCapitalMember2023-04-012023-06-300001837686us-gaap:CommonStockMemberus-gaap:CommonClassAMember2023-04-012023-06-300001837686us-gaap:CommonStockMemberus-gaap:CommonClassAMember2023-06-300001837686us-gaap:CommonStockMemberus-gaap:CommonClassBMember2023-06-300001837686us-gaap:AdditionalPaidInCapitalMember2023-06-300001837686us-gaap:RetainedEarningsMember2023-06-300001837686us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-06-3000018376862023-06-300001837686us-gaap:CommonStockMemberus-gaap:CommonClassAMember2022-12-310001837686us-gaap:CommonStockMemberus-gaap:CommonClassBMember2022-12-310001837686us-gaap:AdditionalPaidInCapitalMember2022-12-310001837686us-gaap:RetainedEarningsMember2022-12-310001837686us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-12-3100018376862022-12-310001837686us-gaap:RetainedEarningsMember2023-01-012023-06-300001837686us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-01-012023-06-300001837686us-gaap:AdditionalPaidInCapitalMember2023-01-012023-06-300001837686us-gaap:CommonStockMemberus-gaap:CommonClassAMember2023-01-012023-06-300001837686vmeo:SelfServeAddOnsMember2024-04-012024-06-300001837686vmeo:SelfServeAddOnsMember2023-04-012023-06-300001837686vmeo:SelfServeAddOnsMember2024-01-012024-06-300001837686vmeo:SelfServeAddOnsMember2023-01-012023-06-300001837686vmeo:VimeoEnterpriseMember2024-04-012024-06-300001837686vmeo:VimeoEnterpriseMember2023-04-012023-06-300001837686vmeo:VimeoEnterpriseMember2024-01-012024-06-300001837686vmeo:VimeoEnterpriseMember2023-01-012023-06-300001837686us-gaap:ProductAndServiceOtherMember2024-04-012024-06-300001837686us-gaap:ProductAndServiceOtherMember2023-04-012023-06-300001837686us-gaap:ProductAndServiceOtherMember2024-01-012024-06-300001837686us-gaap:ProductAndServiceOtherMember2023-01-012023-06-300001837686us-gaap:SalesRevenueNetMembercountry:USus-gaap:GeographicConcentrationRiskMember2023-01-012023-06-300001837686us-gaap:SalesRevenueNetMembercountry:USus-gaap:GeographicConcentrationRiskMember2023-04-012023-06-300001837686us-gaap:SalesRevenueNetMembercountry:USus-gaap:GeographicConcentrationRiskMember2024-04-012024-06-300001837686us-gaap:SalesRevenueNetMembercountry:USus-gaap:GeographicConcentrationRiskMember2024-01-012024-06-300001837686country:US2024-04-012024-06-300001837686country:US2023-04-012023-06-300001837686country:US2024-01-012024-06-300001837686country:US2023-01-012023-06-300001837686us-gaap:NonUsMember2024-04-012024-06-300001837686us-gaap:NonUsMember2023-04-012023-06-300001837686us-gaap:NonUsMember2024-01-012024-06-300001837686us-gaap:NonUsMember2023-01-012023-06-300001837686us-gaap:FairValueInputsLevel1Memberus-gaap:MoneyMarketFundsMember2024-06-300001837686us-gaap:FairValueInputsLevel2Memberus-gaap:MoneyMarketFundsMember2024-06-300001837686us-gaap:FairValueInputsLevel3Memberus-gaap:MoneyMarketFundsMember2024-06-300001837686us-gaap:MoneyMarketFundsMember2024-06-300001837686us-gaap:FairValueInputsLevel1Memberus-gaap:BankTimeDepositsMember2024-06-300001837686us-gaap:FairValueInputsLevel2Memberus-gaap:BankTimeDepositsMember2024-06-300001837686us-gaap:FairValueInputsLevel3Memberus-gaap:BankTimeDepositsMember2024-06-300001837686us-gaap:BankTimeDepositsMember2024-06-300001837686us-gaap:FairValueInputsLevel1Member2024-06-300001837686us-gaap:FairValueInputsLevel2Member2024-06-300001837686us-gaap:FairValueInputsLevel3Member2024-06-300001837686us-gaap:FairValueInputsLevel1Memberus-gaap:MoneyMarketFundsMember2023-12-310001837686us-gaap:FairValueInputsLevel2Memberus-gaap:MoneyMarketFundsMember2023-12-310001837686us-gaap:FairValueInputsLevel3Memberus-gaap:MoneyMarketFundsMember2023-12-310001837686us-gaap:MoneyMarketFundsMember2023-12-310001837686us-gaap:FairValueInputsLevel1Memberus-gaap:BankTimeDepositsMember2023-12-310001837686us-gaap:FairValueInputsLevel2Memberus-gaap:BankTimeDepositsMember2023-12-310001837686us-gaap:FairValueInputsLevel3Memberus-gaap:BankTimeDepositsMember2023-12-310001837686us-gaap:BankTimeDepositsMember2023-12-310001837686us-gaap:FairValueInputsLevel1Member2023-12-310001837686us-gaap:FairValueInputsLevel2Member2023-12-310001837686us-gaap:FairValueInputsLevel3Member2023-12-310001837686vmeo:ContingentConsiderationLiabilityMember2023-03-310001837686vmeo:ContingentConsiderationLiabilityMember2022-12-310001837686vmeo:ContingentConsiderationLiabilityMember2023-04-012023-06-300001837686vmeo:ContingentConsiderationLiabilityMember2023-01-012023-06-300001837686vmeo:ContingentConsiderationLiabilityMember2023-06-300001837686vmeo:WIREWAXLtdMember2023-03-310001837686vmeo:WIREWAXLtdMember2023-01-012023-03-310001837686vmeo:WIREWAXLtdMembervmeo:ContingentConsiderationLiabilityMember2023-01-012023-03-310001837686vmeo:WibbitzLtdMember2023-07-012023-09-300001837686us-gaap:CommonClassAMember2024-01-012024-06-300001837686us-gaap:CommonClassBMember2024-01-012024-06-300001837686us-gaap:CommonClassAMember2021-05-250001837686us-gaap:CommonClassBMember2021-05-250001837686us-gaap:RestrictedStockMembersrt:DirectorMembervmeo:RestrictedStockAgreementMember2024-06-300001837686us-gaap:RestrictedStockMembersrt:DirectorMembervmeo:RestrictedStockAgreementMember2023-12-3100018376862022-02-250001837686us-gaap:SubsequentEventMember2024-07-012024-08-010001837686us-gaap:SubsequentEventMember2024-08-010001837686us-gaap:AccumulatedTranslationAdjustmentMember2024-04-012024-06-300001837686us-gaap:AccumulatedTranslationAdjustmentMember2023-04-012023-06-300001837686us-gaap:AccumulatedTranslationAdjustmentMember2024-01-012024-06-300001837686us-gaap:AccumulatedTranslationAdjustmentMember2023-01-012023-06-300001837686country:US2024-06-300001837686country:US2023-12-310001837686us-gaap:NonUsMember2024-06-300001837686us-gaap:NonUsMember2023-12-310001837686vmeo:EMICapitolRecordsCopyrightInfringementLitigationMember2009-12-012009-12-310001837686vmeo:PartialSummaryJudgementMembervmeo:EMICapitolRecordsCopyrightInfringementLitigationMember2013-09-182013-09-180001837686vmeo:EMICapitolRecordsCopyrightInfringementLitigationMember2013-09-182013-09-180001837686vmeo:DeniedSummaryJudgementMembervmeo:EMICapitolRecordsCopyrightInfringementLitigationMember2013-09-182013-09-180001837686us-gaap:JudicialRulingMembervmeo:EMICapitolRecordsCopyrightInfringementLitigationMember2013-09-182013-09-180001837686vmeo:RTICopyrightLitigationMember2012-01-012017-12-310001837686vmeo:RTICopyrightLitigationMember2019-01-152019-01-150001837686vmeo:RTICopyrightLitigationMember2019-06-022019-06-020001837686vmeo:RTICopyrightLitigationMember2023-10-122023-10-120001837686vmeo:RTICopyrightLitigationMember2023-06-012023-06-010001837686vmeo:SonyUniversalWarnerCopyrightMember2021-03-012021-03-310001837686vmeo:IACInterActiveCorpMembersrt:AffiliatedEntityMember2024-06-300001837686vmeo:IACInterActiveCorpMembersrt:AffiliatedEntityMember2023-12-310001837686vmeo:IACInterActiveCorpMembersrt:AffiliatedEntityMembervmeo:IACHeadquartersOccupancyAndSubsidiaryOfAngiOccupancyMember2024-04-012024-06-300001837686vmeo:IACInterActiveCorpMembersrt:AffiliatedEntityMembervmeo:IACHeadquartersOccupancyAndSubsidiaryOfAngiOccupancyMember2023-04-012023-06-300001837686vmeo:IACInterActiveCorpMembersrt:AffiliatedEntityMembervmeo:IACHeadquartersOccupancyAndSubsidiaryOfAngiOccupancyMember2023-01-012023-06-300001837686vmeo:IACInterActiveCorpMembersrt:AffiliatedEntityMembervmeo:IACHeadquartersOccupancyAndSubsidiaryOfAngiOccupancyMember2024-01-012024-06-3000018376862024-01-012024-03-3100018376862023-01-012023-03-31
As filed with the Securities and Exchange Commission on August 6, 2024
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended June 30, 2024
Or
☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from__________to__________                            
Commission File No. 001-40420
Vimeo Logo_RegistrationBlack.jpg
VIMEO, INC.
(Exact name of registrant as specified in its charter)
Delaware85-4334195
 (State or other jurisdiction of
incorporation or organization)		(I.R.S. Employer
Identification No.)
330 West 34th Street, 5th Floor New York, New York 10001
(Address of registrant's principal executive offices)
(212) 524-8791
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of Each ClassTrading SymbolName of Exchange on Which Registered
Common Stock, par value $0.01 per shareVMEO
The Nasdaq Stock Market LLC
(Nasdaq Global Select Market)
Securities registered pursuant to Section 12(g) of the Act:
None
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒   No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒    No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer☒Accelerated filer☐Non-accelerated filer☐Smaller reporting company☐Emerging growth company☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐    No ☒
As of August 1, 2024, the following shares of the registrant's common stock were outstanding:
Common Stock156,398,096 
Class B common stock9,399,250 
Total165,797,346 


TABLE OF CONTENTS
  Page
Number


SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "will," "may, "could," "should," "would," "anticipates," "estimates," "expects," "plans," "projects," "forecasts," "intends," "targets," "seeks" and "believes," as well as variations of these words, among others, generally identify forward-looking statements. These forward-looking statements include, among others, statements relating to Vimeo's future results of operations and financial condition, business strategy, and plans and objectives of management for future operations.
Forward-looking statements are based on our management's beliefs and assumptions and on information currently available. These forward-looking statements are subject to a number of known and unknown risks, uncertainties and assumptions. Actual results could differ materially from those contained in or implied by these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to:
•we have a history of losses,
•our prior rapid growth may not be indicative of future performance, and our revenue has declined in recent periods,
•our limited operating history as a pure software-as-a-service ("SaaS") company and our limited history of selling such plans through our sales force,
•our total addressable market may prove to be smaller than we expect,
•our ability to read data and make forecasts may be limited,
•we may not have the right product/market fit and may not be able to attract free users or subscribers,
•we may not be able to convert our free users into subscribers,
•competition in our market is intense,
•we may not be able to scale our business effectively,
•we may need additional funding as we continue to grow our business,
•the use or capabilities of artificial intelligence in our offerings may result in reputational harm and liability,
•we may experience service interruptions,
•hosting and delivery costs may increase unexpectedly,
•weakened global economic conditions may harm our industry, business and results of operations,
•our business involves hosting large quantities of user content,
•we have been sued for hosting content that allegedly infringed on a third-party copyright,
•we may face liability for hosting a variety of tortious or unlawful materials,
•we have faced negative publicity for removing, or declining to remove, certain content, regardless of whether such content violated any law,
•we collect, store and process large amounts of content and personal information and any loss of or unauthorized access to such data could materially impact our business,
•if our business becomes constrained by changing legal and regulatory requirements, including with respect to privacy, data security and data protection, consumer protection, and user-generated content, or enforcement by government regulators, including fines, orders or consent decrees in the U.S. or other jurisdictions in which we operate, our operating results will suffer,
•we may experience a disruption of our business activities due to senior executive transitions,
•we have been the target of cyberattacks by malicious actors,
•we have faced claims that we infringe third-party intellectual property rights, and
•the risks described in the section titled "Risk Factors" and elsewhere in this Quarterly Report on Form 10-Q.


Moreover, we operate in a very competitive and rapidly changing environment. New risk factors emerge from time to time, and it is not possible for our management to predict all risk factors nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ from those contained in, or implied by, any forward-looking statements.

You should not rely upon forward-looking statements as predictions of future events. We cannot assure you that the events and circumstances reflected in the forward-looking statements will be achieved or occur. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. You should read this Quarterly Report on Form 10-Q and the documents that we reference in this Quarterly Report on Form 10-Q and have filed as exhibits to this report with the understanding that our actual future results, levels of activity, performance, and achievements may be materially different from what we expect. Any forward-looking statements only speak as of the date of this document, and we undertake no obligation to update any forward-looking information or statements, whether written or oral, to reflect any change, except as required by law. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified by these cautionary statements.

PART I
FINANCIAL INFORMATION
Item 1.    Consolidated Financial Statements
VIMEO, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(Unaudited)
June 30, 2024December 31, 2023
(In thousands, except par value amounts)
ASSETS  
Cash and cash equivalents$310,579 $301,372 
Accounts receivable, net25,263 26,605 
Prepaid expenses and other current assets20,115 23,491 
Total current assets355,957 351,468 
Leasehold improvements and equipment, net538 607 
Goodwill245,406 245,406 
Intangible assets with definite lives, net1,934 2,629 
Other non-current assets22,458 22,810 
TOTAL ASSETS$626,293 $622,920 
LIABILITIES AND SHAREHOLDERS' EQUITY  
LIABILITIES:  
Accounts payable, trade$3,412 $4,696 
Deferred revenue168,014 168,610 
Accrued expenses and other current liabilities43,776 53,573 
Total current liabilities215,202 226,879 
Other long-term liabilities13,199 13,809 
Commitments and contingencies
SHAREHOLDERS' EQUITY: 
Common stock, $0.01 par value; 1,600,000 shares authorized; 160,265 and 158,511 shares issued and 157,228 and 158,511 shares outstanding, respectively
1,603 1,585 
Class B common stock, $0.01 par value; 400,000 shares authorized; 9,399 shares issued and outstanding, respectively
94 94 
Preferred stock, $0.01 par value; 100,000 shares authorized; no shares issued and outstanding
— — 
Additional paid-in capital786,044 774,587 
Accumulated deficit(377,141)(393,335)
Accumulated other comprehensive loss(937)(699)
Treasury stock, 3,037 and — shares, respectively
(11,771)— 
Total shareholders' equity397,892 382,232 
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$626,293 $622,920 

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
5
VIMEO, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
Three Months Ended June 30,Six Months Ended June 30,
 2024202320242023
 (In thousands, except per share data)
Revenue$104,376 $101,835 $209,286 $205,417 
Cost of revenue (exclusive of depreciation shown separately below)22,678 22,845 46,121 46,517 
Gross profit81,698 78,990 163,165 158,900 
Operating expenses:
Research and development expense26,972 26,676 55,107 57,936 
Sales and marketing expense27,676 39,764 59,981 79,751 
General and administrative expense19,087 6,943 37,121 16,249 
Depreciation 154 102 211 1,030 
Amortization of intangibles348 910 695 2,144 
Total operating expenses74,237 74,395 153,115 157,110 
Operating income7,461 4,595 10,050 1,790 
Interest expense — (877)— (998)
Other income, net3,881 2,934 7,697 5,578 
Earnings before income taxes11,342 6,652 17,747 6,370 
Income tax provision(1,221)(781)(1,553)(1,197)
Net earnings$10,121 $5,871 $16,194 $5,173 
Per share information:
Basic earnings per share$0.06 $0.04 $0.10 $0.03 
Diluted earnings per share$0.06 $0.03 $0.09 $0.03 
Stock-based compensation expense by function:  
Cost of revenue$198 $328 $345 $469 
Research and development expense3,895 4,583 7,718 9,501 
Sales and marketing expense824 3,166 2,645 5,653 
General and administrative expense3,463 (8,661)4,644 (17,316)
Total stock-based compensation expense$8,380 $(584)$15,352 $(1,693)

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
6
VIMEO, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF COMPREHENSIVE OPERATIONS
(Unaudited)
Three Months Ended June 30,Six Months Ended June 30,
 2024202320242023
 (In thousands)
Net earnings$10,121 $5,871 $16,194 $5,173 
Other comprehensive (loss) income:
Change in foreign currency translation adjustment(114)378 (238)250 
Total other comprehensive (loss) income(114)378 (238)250 
Comprehensive income $10,007 $6,249 $15,956 $5,423 


The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
7
VIMEO, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
Three and Six Months Ended June 30, 2024 and 2023
(Unaudited)
 
Common stock, $0.01 par value
Class B common stock, $0.01 par value
Additional
Paid-in Capital		Accumulated DeficitAccumulated
Other
Comprehensive
Loss		Treasury StockTotal
Shareholders' Equity
 $Shares$Shares
 (In thousands)
Balance at March 31, 2024$1,594 159,440 $94 9,399 $779,191 $(387,262)$(823)$— $392,794 
Net earnings— — — — — 10,121 — — 10,121 
Other comprehensive loss— — — — — — (114)— (114)
Stock-based compensation expense— — — — 8,380 — — — 8,380 
Amounts related to settlement of equity awards9 825 — — (1,527)— — — (1,518)
Purchase of treasury stock— — — — — — — (11,771)(11,771)
Balance at June 30, 2024$1,603 160,265 $94 9,399 $786,044 $(377,141)$(937)$(11,771)$397,892 
Balance at December 31, 2023$1,585 158,511 $94 9,399 $774,587 $(393,335)$(699)$— $382,232 
Net earnings— — — — — 16,194 — — 16,194 
Other comprehensive loss— — — — — — (238)— (238)
Stock-based compensation expense— — — — 15,352 — — — 15,352 
Amounts related to settlement of equity awards18 1,754 — — (3,895)— — — (3,877)
Purchase of treasury stock— — — — — — — (11,771)(11,771)
Balance at June 30, 2024$1,603 160,265 $94 9,399 $786,044 $(377,141)$(937)$(11,771)$397,892 

 
Common stock, $0.01 par value
Class B common stock, $0.01 par value
Additional
Paid-in Capital		Accumulated DeficitAccumulated
Other
Comprehensive
Loss		Total
Shareholders' Equity
 $Shares$Shares
 (In thousands)
Balance at March 31, 2023$1,561 $156,054 $94 $9,399 $765,662 $(416,065)$(959)$350,293 
Net earnings— — — — — 5,871 — 5,871 
Other comprehensive income— — — — — — 378 378 
Stock-based compensation expense— — — — (584)— — (584)
Amounts related to settlement of equity awards13 1,385 — — (3,078)— — (3,065)
Balance at June 30, 2023$1,574 157,439 $94 9,399 $762,000 $(410,194)$(581)$352,893 
Balance at December 31, 2022$1,572 $157,187 $94 $9,399 $768,390 $(415,367)$(831)$353,858 
Net earnings— — — — — 5,173 — 5,173 
Other comprehensive income— — — — — — 250 250 
Stock-based compensation expense— — — — (1,693)— — (1,693)
Amounts related to settlement of equity awards18 1,876 — — (4,713)— — (4,695)
Restricted Stock Award(16)(1,624)— — 16 — — — 
Balance at June 30, 2023$1,574 157,439 $94 9,399 $762,000 $(410,194)$(581)$352,893 

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
8
VIMEO, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
Six Months Ended June 30,
 20242023
 (In thousands)
Cash flows from operating activities:  
Net earnings$16,194 $5,173 
Adjustments to reconcile net earnings to net cash provided by operating activities: 
Stock-based compensation expense15,352 (1,693)
Amortization of intangibles695 2,144 
Depreciation211 1,030 
Provision for credit losses30 17 
Loss on the sale of an asset— 37 
Non-cash lease expense2,269 2,267 
Other adjustments, net25 1,411 
Changes in assets and liabilities:
Accounts receivable414 3,870 
Prepaid expenses and other assets2,929 (57)
Accounts payable and other liabilities(13,022)(11,417)
Deferred revenue191 8,414 
Net cash provided by operating activities25,288 11,196 
Cash flows from investing activities:
Capital expenditures(160)(107)
Proceeds from the sale of an asset— 639 
Net cash (used in) provided by investing activities(160)532 
Cash flows from financing activities:
Amounts related to settlement of equity awards(3,935)(4,180)
Proceeds from exercise of stock options22 128 
Purchases of treasury stock(11,495)— 
Contingent consideration payment— (3,297)
Other— (266)
Net cash used in financing activities(15,408)(7,615)
Total cash provided9,720 4,113 
Effect of exchange rate changes on cash and cash equivalents and restricted cash(337)(154)
Net increase in cash and cash equivalents and restricted cash9,383 3,959 
Cash and cash equivalents and restricted cash at beginning of period301,436 274,834 
Cash and cash equivalents and restricted cash at end of period$310,819 $278,793 

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
9
VIMEO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

NOTE 1—ORGANIZATION AND BASIS OF PRESENTATION
Description of Business
Vimeo is the world's leading all-in-one video software solution, providing the full breadth of video tools through a software-as-a-service model. Vimeo's comprehensive and cloud-based tools empower its users to create, collaborate and communicate with video on a single, turnkey platform.
As used herein, "Vimeo," the "Company," "we," "our" or "us" and similar terms in these consolidated financial statements refer to Vimeo, Inc. and its subsidiaries (unless the context requires otherwise).
Basis of Presentation and Consolidation
The accompanying unaudited interim consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP") and with the rules and regulations of the Securities and Exchange Commission ("SEC"). Accordingly, they do not include all of the information and notes required by GAAP for complete annual financial statements. In the opinion of management, the accompanying unaudited interim consolidated financial statements include all adjustments considered necessary for a fair presentation. Interim results are not necessarily indicative of the results that may be expected for the full year. The information included in this Form 10-Q should be read in conjunction with the annual audited consolidated financial statements and accompanying notes included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.
All intercompany balances and transactions between and among Vimeo and its subsidiaries have been eliminated. All related party balances between Vimeo and IAC/InterActiveCorp ("IAC") and its subsidiaries are reflected in the accompanying consolidated balance sheet within "Accrued expenses and other current liabilities" and "Other long-term liabilities."
All related party transactions between Vimeo and IAC and its subsidiaries, other than amounts related to the settlement of equity awards, are reflected in the accompanying consolidated statement of cash flows as operating activities. Amounts related to the settlement of equity awards are reflected in the accompanying consolidated statement of cash flows as financing activities.
Accounting Estimates
Management of Vimeo is required to make certain estimates, judgments and assumptions during the preparation of its consolidated financial statements in accordance with GAAP that affect the amounts reported in the accompanying consolidated financial statements and footnotes thereto. Actual results could differ from these estimates.

Significant estimates and judgments inherent in the preparation of the accompanying consolidated financial statements include those related to: the carrying value of accounts receivable, including the determination of the allowance for credit losses; the determination of the estimated customer relationship period for certain costs to obtain a contract with a customer; the carrying value of right-of-use assets ("ROU assets") and related lease liabilities; the useful lives and recoverability of intangible assets with definite lives; the recoverability of goodwill; contingencies; unrecognized tax benefits; the valuation allowance for deferred income tax assets; and the accounting for stock-based compensation expense, among others. Vimeo bases its estimates, judgments and assumptions on historical experience, its forecasts and budgets and other factors that Vimeo considers relevant.
Recent Accounting Pronouncements Not Yet Adopted by the Company
In November 2023, Accounting Standards Update ("ASU") 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures was issued, which amended existing guidance to require disclosure of significant segment expenses and other segment items on an annual and interim basis and to provide in interim periods all disclosures about a reportable segment's profit or loss and assets that are currently required annually. These amendments are effective on a retrospective basis for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements.
10
VIMEO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
In December 2023, ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures was issued, and requires disclosure of disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. This guidance will become effective for fiscal years beginning after December 15, 2024 on a prospective basis. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements.
NOTE 2—REVENUE

Revenue Recognition
Vimeo's revenue is derived primarily from fixed SaaS subscription fees paid by customers. Subscription periods generally range from one month to three years, with the most common being an annual subscription, and are generally non-cancellable.
Vimeo accounts for a contract with a customer when it has approval and commitment from all parties, the rights of the parties and payment terms are identified, the contract has commercial substance and collectability of consideration is probable. The transaction price, which generally reflects the fixed SaaS subscription fees listed in the terms of the contract, is the amount of consideration Vimeo expects to be entitled to in exchange for access to the Vimeo platform. The transaction price is recognized as revenue on a straight-line basis over the contractual term of the arrangement beginning on the date access is provided to the Vimeo platform, which is considered to be a series of distinct services that comprise a single performance obligation and have the same pattern of transfer over the contractual term. All taxes assessed by governmental authorities that are both (i) imposed on and concurrent with a specific revenue-producing transaction and (ii) collected from customers are excluded from the measurement of the transaction price, and accordingly, not included as a component of revenue or cost of revenue. For contracts that have an original duration of one year or less, Vimeo does not consider the time value of money applicable to such contracts. Estimates of variable consideration are not significant.
Disaggregated revenue is as follows:
Three Months Ended June 30,Six Months Ended June 30,
2024202320242023
(In thousands)
Revenue:
Self-Serve & Add-Ons$68,565 $70,821 $138,477 $142,423 
Vimeo Enterprise20,051 12,899 38,518 24,471 
Other15,760 18,115 32,291 38,523 
Total$104,376 $101,835 $209,286 $205,417 

Revenue by geography is based on where the customer is located. The United States was the only country from which revenue constituted greater than 10% of total revenue of the Company for the three and six months ended June 30, 2024 and 2023.
Three Months Ended June 30,Six Months Ended June 30,
2024202320242023
(In thousands)
Revenue:
United States$56,896 $54,184 $114,225 $108,899 
All other countries47,480 47,651 95,061 96,518 
Total$104,376 $101,835 $209,286 $205,417 

11
VIMEO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
Deferred Revenue
Deferred revenue consists of payments that are received or are contractually due in advance of Vimeo's performance. Vimeo's deferred revenue is reported on a contract by contract basis at the end of each reporting period. Vimeo classifies deferred revenue as current when the term of the applicable subscription period or expected completion of its performance obligation is one year or less. The current and non-current deferred revenue balances are included in the accompanying consolidated balance sheet as follows:
June 30,
2024		December 31,
2023
(In thousands)
Deferred revenue$168,014 $168,610 
Other long-term liabilities1,107 1,216 
During the six months ended June 30, 2024, Vimeo recognized $126.9 million of revenue that was included in the deferred revenue balance at December 31, 2023. During the six months ended June 30, 2023, Vimeo recognized $126.3 million of revenue that was included in the deferred revenue balance at December 31, 2022.
Costs to Obtain a Contract with a Customer
Vimeo has determined that commissions paid to employees pursuant to certain sales incentive programs meet the requirements to be capitalized as a cost of obtaining a contract with a customer. Commissions paid to employees pursuant to certain sales incentive programs are amortized over the estimated customer relationship period. Vimeo calculates the estimated customer relationship period as the average customer life, which is based on historical data. When customer renewals are expected and the renewal commission is not commensurate with the initial commission, the average customer life includes renewal periods. Vimeo has elected the practical expedient to expense costs to obtain a contract with a customer as incurred when the customer relationship period is one year or less.
The current and non-current balances of capitalized costs to obtain a contract with a customer are included in the accompanying consolidated balance sheet as follows:
June 30,
2024		December 31,
2023
(In thousands)
Prepaid expenses and other current assets$5,066 $5,099 
Other non-current assets8,108 8,263 
NOTE 3—INCOME TAXES
At the end of each interim period, Vimeo estimates the annual expected effective income tax rate and applies that rate to its ordinary year-to-date earnings or loss with discrete items recorded in the period. The estimates used to compute the provision or benefit for income taxes may change as new events occur, additional information is obtained, or Vimeo's tax environment changes.
For the three months ended June 30, 2024 and 2023, Vimeo recorded an income tax provision of $1.2 million and $0.8 million, respectively. For the six months ended June 30, 2024 and 2023, Vimeo recorded an income tax provision of $1.6 million and $1.2 million, respectively. The effective income tax rate was lower than the federal statutory rate of 21% primarily due to movement in the valuation allowance, the effects of international tax provisions as required under 2017 Tax Cuts and Jobs Act, partially offset by stock-based awards. Vimeo's largest deferred tax assets are capitalized research and development expenses and tax attribute carryforwards. Vimeo has recorded a valuation allowance for the majority of its net deferred tax assets because it has concluded that it is more likely than not that the tax benefit will not be realized.

12
VIMEO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
At June 30, 2024 and December 31, 2023, unrecognized tax benefits, including interest and penalties, were $5.0 million and $4.6 million, respectively. The Company would recognize an income tax benefit of $0.5 million if unrecognized tax benefits at June 30, 2024 are subsequently recognized. Vimeo believes no unrecognized tax benefits would decrease by June 30, 2025. Vimeo recognizes interest and penalties related to unrecognized tax benefits, if applicable, in the income tax provision.


NOTE 4—FAIR VALUE MEASUREMENTS
Vimeo's financial instruments that are measured at fair value on a recurring basis are as follows:
 June 30, 2024
 Quoted Market
Prices for
Identical Assets in Active
Markets
(Level 1)		Significant
Other
Observable
Inputs
(Level 2)		Significant
Unobservable
Inputs
(Level 3)		Total
Fair Value
Measurements
 (In thousands)
Money market funds$282,233 $— $— $282,233 
Time deposits— 6,393 — 6,393 
Total$282,233 $6,393 $— $288,626 

 December 31, 2023
 Quoted Market
Prices for
Identical Assets in Active
Markets
(Level 1)		Significant
Other
Observable
Inputs
(Level 2)		Significant
Unobservable
Inputs
(Level 3)		Total
Fair Value
Measurements
 (In thousands)
Money market funds$274,212 $— $— $274,212 
Time deposits— 6,098 — 6,098 
Total$274,212 $6,098 $— $280,310 

Money market funds and time deposits are included in "Cash and cash equivalents" in the accompanying consolidated balance sheet.
Vimeo's non-financial assets (which consist primarily of goodwill, ROU assets, and intangible assets with definite lives) are adjusted to fair value only if an impairment is recognized. Such fair value measurements are based predominantly on Level 3 inputs.
13
VIMEO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)

The changes in the Company's financial instruments that are measured at fair value on a recurring basis using significant unobservable inputs (Level 3) are as follows and solely relate to the Company's contingent consideration arrangements, which were finalized and paid in 2023 (as described below):

Three Months Ended June 30,Six Months Ended June 30,
20232023
(In thousands)
Balance at beginning of period$2,977 $7,845 
Total net losses:
Included in operating income— 104 
Settlements— (4,972)
Balance at end of period$2,977 $2,977 

Contingent Consideration Arrangements

The aggregate purchase price of the Company's 2021 acquisitions of WIREWAX Ltd. ("WIREWAX") and Wibbitz Ltd. ("Wibbitz") consisted of cash consideration and contingent consideration, based on a combination of certain financial metrics and integration milestones.
In the first quarter of 2023, the contingent consideration arrangement for WIREWAX was finalized and resulted in a payment of $5.0 million to WIREWAX's former shareholders and a $0.1 million loss that was recorded within "General and administrative expense" in the accompanying consolidated statement of operations. In the accompanying consolidated statement of cash flows, the final $5.0 million payment is included in "Contingent consideration payment" within financing activities and "Accounts payable and other liabilities" within operating activities for $3.3 million and $1.7 million, respectively.
In the third quarter of 2023, the contingent consideration arrangement for Wibbitz was finalized and the Company paid $2.5 million to Wibbitz's former shareholders.

NOTE 5—SHAREHOLDERS' EQUITY
Description of Vimeo Common Stock and Vimeo Class B Common Stock
Except as described herein, shares of Vimeo common stock and Vimeo Class B common stock are identical.
In general, the holders of shares of Vimeo common stock vote together as a single class with the holders of shares of Vimeo Class B common stock on all matters, including the election of directors; provided, however, that the holders of shares of Vimeo common stock, acting as a single class, are entitled to elect twenty-five percent (25%) of the total number of Vimeo directors, rounded up to the next whole number in the event of a fraction. Each outstanding share of Vimeo common stock and Vimeo Class B common stock entitles the holder to one vote per share and ten votes per share, respectively.
The holders of shares of Vimeo common stock and the holders of shares of Vimeo Class B common stock are entitled to receive, share for share, such dividends as may be declared by Vimeo's Board of Directors (the "Board") out of funds legally available for the payment of dividends. In the event of a liquidation, dissolution, distribution of assets or winding-up of Vimeo, the holders of shares of Vimeo common stock and the holders of shares of Vimeo Class B common stock are entitled to receive, share for share, all the assets available for distribution after payment of a proper amount to the holders of any series of Vimeo preferred stock, including any series that may be issued in the future.
Vimeo is authorized to issue 1,600,000,000 shares of Vimeo common stock and 400,000,000 shares of Vimeo Class B common stock.
14
VIMEO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
Vimeo Restricted Shares
Vimeo Restricted Shares (held by Joseph Levin, Special Advisor to the Board and former Chairman and member of the Board) totaling 3,247,000 shares were reflected in the accompanying consolidated balance sheet within "Common Stock" at June 30, 2024 and December 31, 2023. Vesting of the Vimeo Restricted Shares is subject to Mr. Levin's continued service as Special Advisor to the Board through November 5, 2030, as well as the achievement of certain stock price targets. Vimeo Restricted Shares have a non-forfeitable dividend right in the event the Company declares a cash dividend to common shareholders and participates in all other distributions of the Company in the same manner as all other Vimeo common shareholders.
Description of Preferred Stock
The Board is authorized to provide for the issuance of shares of preferred stock, and any class or series thereof, and to assign the designations, powers, preferences and rights to each such class or series and any qualifications, limitations or restrictions. There have been no preferred stock issuances to date.
Stock Repurchase Program
On February 25, 2022, the Board authorized a stock repurchase program of up to $50 million of the Company’s common stock through open market or private transactions (the "Stock Repurchase Program"). Under the Stock Repurchase Program, Vimeo may repurchase shares of its common stock at any time or from time to time, without prior notice, subject to market conditions and other considerations, as determined by management. Vimeo's repurchases may be made through 10b5-1 plans, open market purchases, privately negotiated transactions, block purchases or other transactions. No date has been established for the completion of the Stock Repurchase Program. Vimeo intends to fund repurchases under the Stock Repurchase Program from cash on hand. Vimeo has no obligation to repurchase any shares under the Stock Repurchase Program and may suspend or discontinue it at any time. During the six months ended June 30, 2024, the Company repurchased 3.0 million shares of its common stock, on a trade date basis, at an average cost of $3.88 per share, or in aggregate $11.8 million. There were no shares repurchased during the six months ended June 30, 2023. The Company accounts for treasury stock under the cost method.
Subsequent to June 30, 2024 and through August 1, 2024, the Company repurchased 1.2 million shares of its common stock, on a trade date basis, at an average cost of $3.74 per share, or in aggregate $4.6 million. At August 1, 2024, the Company has $33.7 million remaining under its share repurchase authorization.
NOTE 6—ACCUMULATED OTHER COMPREHENSIVE LOSS
Accumulated other comprehensive loss consisting of foreign currency translation adjustments is as follows:
Three Months Ended June 30,Six Months Ended June 30,
2024202320242023
(In thousands)
Balance at beginning of period$(823)$(959)$(699)$(831)
Other comprehensive (loss) income(114)378 (238)250 
Balance at end of period$(937)$(581)$(937)$(581)
At both June 30, 2024 and 2023, there was no tax benefit or provision on accumulated other comprehensive loss.
15
VIMEO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
NOTE 7—EARNINGS PER SHARE
Vimeo common stock and Class B common stock are treated as one class of common stock for earnings per share ("EPS") purposes as both classes of common stock participate in earnings, dividends and other distributions on the same basis. Vimeo calculates basic EPS using the two-class method since the Vimeo Restricted Shares are participating securities as they are unvested and have a non-forfeitable dividend right in the event the Company declares a cash dividend to common shareholders and participates in all other distributions of the Company in the same manner as all other Vimeo common shareholders. Diluted EPS is calculated, on the most dilutive basis, which excludes equity awards that would be anti-dilutive.
The computation of basic and diluted earnings per share attributable to common shareholders is as follows:

 Three Months Ended June 30,Six Months Ended June 30,
 2024202320242023
 (In thousands, except per share data)
Basic EPS:
Numerator:
Net earnings$10,121 $5,871 $16,194 $5,173 
Less: Net earnings attributed to participating security(195)(115)(312)(123)
Net earnings attributable to common stock shareholders$9,926 $5,756 $15,882 $5,050 
Denominator: (a)
Weighted average basic common shares outstanding165,295 162,733 165,164 162,285 
Basic earnings per share$0.06 $0.04 $0.10 $0.03 
Diluted EPS:
Numerator:
Net earnings$10,121 $5,871 $16,194 $5,173 
Less: Net earnings attributed to participating security(191)(113)(305)(121)
Net earnings attributable to common stock shareholders$9,930 $5,758 $15,889 $5,052 
Denominator: (a)
Weighted average basic common shares outstanding165,295 162,733 165,164 162,285 
Dilutive securities3,353 2,255 3,658 2,133 
Weighted average diluted common shares outstanding168,648 164,988 168,822 164,418 
Antidilutive securities13,969 23,543 13,391 23,981 
Diluted earnings per share$0.06 $0.03 $0.09 $0.03 
_____________________
(a)    Vimeo Restricted Shares were included in shares of common stock issued and outstanding at June 30, 2024 and December 31, 2023 in the accompanying consolidated balance sheet, but were excluded from the computation of average basic common shares outstanding for EPS purposes because the number of shares that ultimately vest is subject to the satisfaction of certain market-based conditions.
16
VIMEO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
NOTE 8—FINANCIAL STATEMENT DETAILS
Cash and Cash Equivalents and Restricted Cash
The reconciliation of cash and cash equivalents and restricted cash reported within the accompanying consolidated balance sheet to the total amounts shown in the accompanying consolidated statement of cash flows is as follows:
June 30, 2024December 31, 2023June 30, 2023December 31, 2022
(In thousands)
Cash and cash equivalents$310,579 $301,372 $278,445 $274,497 
Restricted cash included in Prepaid expenses and other current assets240 64 348 337 
Total cash and cash equivalents and restricted cash as shown in the accompanying consolidated statement of cash flows$310,819 $301,436 $278,793 $274,834 
Restricted cash at June 30, 2024, June 30, 2023, and December 31, 2022 primarily consisted of deposits related to a lease and corporate credit cards.
Restricted cash at December 31, 2023 primarily consisted of a deposit related to corporate credit cards.
Credit Losses
The changes in the allowance for credit losses are as follows:
Six Months Ended June 30,
20242023
(In thousands)
Balance at beginning of period$2,728 $5,183 
Provision for credit losses30 17 
Write-offs charged against the allowance(988)(2,693)
Recoveries collected451 516 
Currency translation adjustment(1)9 
Balance at end of period$2,220 $3,032 
Accumulated Amortization and Depreciation
Accumulated amortization and depreciation within the accompanying consolidated balance sheet are as follows:
Asset CategoryJune 30, 2024December 31, 2023
 (In thousands)
ROU assets included in Other non-current assets$16,805 $14,536 
Leasehold improvements and equipment$590 $704 
Intangible assets with definite lives$48,326 $47,631 

17
VIMEO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
Other income, net
The components of "Other income, net" are as follows:
 Three Months Ended June 30,Six Months Ended June 30,
 2024202320242023
 (In thousands)
Interest income3,760 2,992 $7,431 $5,678 
Foreign exchange gains (losses), net$121 $(58)266 (63)
Loss on the sale of an asset— — — (37)
Other income, net$3,881 $2,934 $7,697 $5,578 

Geographic Concentrations
Long-lived assets, excluding goodwill, intangible assets with definite lives and ROU assets, at June 30, 2024 and December 31, 2023 relate to "Leasehold improvements and equipment, net."
June 30,
2024		December 31,
2023
(In thousands)
Leasehold improvements and equipment, net:
United States$399 $492 
All other countries139 115 
Total$538 $607 
NOTE 9—CONTINGENCIES
In the ordinary course of business, Vimeo is, and from time to time may become, a party to various legal proceedings. Vimeo establishes reserves for specific legal matters when it determines that the likelihood of an unfavorable outcome is probable and the loss is reasonably estimable. Management has also identified certain other legal matters where it believes an unfavorable outcome is not probable and, therefore, no reserve is established. Although management currently believes that resolving claims against Vimeo, including claims where an unfavorable outcome is reasonably possible, will not have a material impact on the liquidity, results of operations or financial condition of Vimeo, these matters are subject to inherent uncertainties and management's view of these matters may change in the future. Vimeo also evaluates other contingent matters, including income and non-income tax contingencies, to assess the likelihood of an unfavorable outcome and estimated extent of potential loss. It is possible that an unfavorable outcome of one or more of these lawsuits or other contingencies could have a material impact on the liquidity, results of operations or financial condition of Vimeo. See "Note 3—Income Taxes" for additional information related to income tax contingencies.

EMI/Capitol Records Copyright Infringement Litigation
In December 2009, a group of music publishers owned by EMI Music Publishing (now owned by Sony/ATV Music Publishing, a subsidiary of Sony Entertainment) and a group of then EMI-affiliated record companies, including Capitol Records (now owned by Universal Music Group), filed two lawsuits against Vimeo and its former owner, Connected Ventures, in the U.S. District Court for the Southern District of New York. See Capitol Records, LLC v. Vimeo, LLC, No. 09 Civ. 10101 (S.D.N.Y.) and EMI Blackwood Music, Inc. v. Vimeo, LLC, No. 09 Civ. 10105 (S.D.N.Y.). In both cases, plaintiffs allege that Vimeo infringed their music copyrights (in the publishers' musical compositions and the record companies' sound recordings) by hosting and streaming videos uploaded by users (and in certain cases, former employees) featuring their musical works. Plaintiffs seek, among other things, injunctive relief and monetary damages. The initial complaints identified 199 videos as infringing (which Vimeo removed post-suit).
18
VIMEO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
Prior to suit, plaintiffs did not avail themselves of their right to submit a takedown notice to Vimeo pursuant to the online safe harbor provisions of the Digital Millennium Copyright Act of 1998 ("DMCA"), which limits the liability of online service providers for copyright infringement of their users when the provider takes certain measures. Vimeo asserts that the DMCA limits its liability because it complies with the DMCA and plaintiffs failed to submit takedown notices. Plaintiffs disagree, asserting various theories as to why the DMCA may not apply to some or all of the videos-in-suit.
The district court bifurcated proceedings and required the parties to first litigate the issue of whether Vimeo satisfied the DMCA's safe harbor provisions. On September 18, 2013, the district court granted partial summary judgment to Vimeo on 144 of the 199 original videos-in-suit on the ground that Vimeo complied with the threshold requirements of the DMCA and that there was no evidence that a Vimeo employee had watched the videos in question such that Vimeo had actual or "red flag" knowledge of infringement, which would disqualify the DMCA's application. The court denied summary judgment as to 35 videos-in-suit on the ground that there was a material question of fact as to whether Vimeo had "red flag" knowledge of infringement based upon employees having watched all or part of these videos. The court further held that the DMCA did not apply to the record companies' state-law claims regarding sound recordings fixed before February 1972; a trial was necessary to determine whether Vimeo was liable for employees who uploaded approximately 20 videos; and that plaintiffs should be permitted to amend their complaints to add over 1,500 videos allegedly infringing their copyrights (which Vimeo removed after receiving plaintiffs' proposed amended complaint).
Vimeo sought and obtained the right to appeal certain issues on an interlocutory basis to the U.S. Court of Appeals for the Second Circuit. On June 16, 2016, the Second Circuit held that (1) the district court had applied the incorrect summary-judgment standard for "red flag" infringement and that evidence that an employee watched all or part of a video containing plaintiffs' music did not raise a genuine issue of fact as to whether Vimeo had "red flag" knowledge in such video; (2) the DMCA applies to state-law copyright infringement claims predicated on pre-1972 sound recordings; and (3) on an issue raised by plaintiffs in their cross-appeal, the record did not show that Vimeo was willfully blind towards infringing activity taking place on its platform. As a result of these rulings, the Second Circuit partially vacated the district court's ruling and remanded the case for further proceedings consistent with its judgment.
On March 31, 2018, the district court granted Vimeo’s motion to dismiss plaintiffs' state-law unfair competition claims on the grounds that they were state-law copyright claims covered by the DMCA per the Second Circuit's judgment. On May 28, 2021, the district court granted Vimeo summary judgment as to videos for which the sole remaining basis of liability was the assertion that Vimeo had "red flag" knowledge of infringement. On August 26, 2021, the district court approved a stipulation whereby plaintiffs agreed to conditionally dismiss all remaining claims to allow a final judgment to issue. Under the stipulation, plaintiffs may refile their claims regarding the alleged employee-uploaded videos if the Second Circuit reverses the district court's other rulings in whole or in part. On November 1, 2021, the district court entered a final judgment adopting the terms of the parties' stipulation. On November 29, 2021, plaintiffs filed an appeal to the U.S. Court of Appeals for the Second Circuit. The appeal has been fully briefed and argued.
RTI Copyright Litigation
Between 2012 and 2017, Italian broadcaster Reti Televisive Italiane s.p.a. and an affiliate thereof (collectively, "RTI") filed four lawsuits for copyright infringement against Vimeo in the Civil Court of Rome. See Reti Televisive Italiane s.p.a. v. Vimeo, LLC, Cause Nos. 23732/12, 62343/2015, and 59780/2017 (Rome Civil Court), and Medusa Film v. Vimeo, Inc., Cause No. 74775/2017 (Rome Civil Court). In each case, RTI asserts that Vimeo infringed its copyrights by hosting and streaming user-uploaded videos that allegedly contain RTI's television or film programming, and seeks, among other things, injunctive relief and monetary damages.
On January 15, 2019, the Civil Court of Rome concluded the first case (No. 23732/12) and entered a judgment against Vimeo, awarding RTI damages of €8,500,000 plus interest and entering an injunction against Vimeo with respect to further acts of infringement. Vimeo filed an appeal and petitioned to stay the judgment pending appeal. On May 13, 2019, the Rome Court of Appeals stayed the judgment pending appeal. On August 10, 2022, the Rome Court of Appeals affirmed the judgment. Vimeo has appealed to the Italian Supreme Court of Cassation and the case is currently pending (No. 26719/2022).

19
VIMEO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
On June 2, 2019, the Civil Court of Rome concluded the second case (No. 62343/2015) and entered a judgment against Vimeo, awarding RTI damages of €4,746,273 plus interest and entering an injunction against Vimeo as to further acts infringement. Vimeo filed an appeal and petitioned to stay the judgment pending appeal. The Rome Court of Appeals declined to stay the judgment. On October 12, 2023, the Rome Court of Appeals published its decision affirming the lower court's judgment on liability but reducing the amount of damages to €3,865,161 plus interests and costs. Vimeo has appealed to the Italian Supreme Court of Cassation and the case is currently pending (No. 856/2024).
To pursue enforcement of the judgments in the United States, RTI initially commenced a lawsuit against Vimeo in the U.S. District Court for the Southern District of New York on October 26, 2020 to enforce the June 2019 judgment. See Reti Televisive Italiane s.p.a. v. Vimeo, LLC, No. 20 Civ. 8954 (S.D.N.Y.). On December 22, 2020, Vimeo and RTI filed, and the district court entered, a stipulation and order staying the U.S. proceedings pending the final outcome of the appeals from the Italian judgment at issue. On June 1, 2023, RTI filed an action in the Supreme Court of New York, New York County to enforce the Civil Court's judgment of €8,500,000 (No. 652646/2023). The case was removed to federal court and is now pending in the Southern District of New York. See Reti Televisive Italiane S.p.A. v. Vimeo.com, Inc, No. 23 Civ. 05488 (S.D.N.Y.). On October 20, 2023, the U.S. District Court for the Southern District of New York entered an order lifting the stay of the U.S. enforcement proceedings in the first case (No. 20 Civ. 8954) and consolidating the two enforcement proceedings (No. 20 Civ. 8954 and No. 23 Civ. 05488). Vimeo has filed a Motion for Summary Judgement or, in the Alternative, to Stay the Case.
On April 7, 2023, the Civil Court of Rome published a decision finding in favor of Vimeo and dismissing the third case (No. 59780/2017) in its entirety. On October 9, 2023, RTI served Vimeo with its appeal challenging the court's decision in the third case. The case is currently pending before the appellate court (No. 5033/2023).

On October 18, 2022, the Civil Court of Rome issued a decision in the fourth case, Medusa Film v. Vimeo, Inc. (No. 74775/2017) finding liability but rejecting RTI's damage calculation and reserving judgment as to the amount of damages. On November 30, 2022, RTI served a notice of appeal challenging the court's decision on damages. The case is currently pending before the appellate court (No. 6536/2022).

On June 26, 2024, the parties entered into a settlement agreement to resolve the lawsuits pending in Italy and the consolidated enforcement action pending in New York. The settlement agreement included a payment to the plaintiffs, which did not have a material impact on Vimeo’s financial condition, results of operations, or cash flows. Pursuant to the settlement agreement, on July 12, 2024, the parties filed a Joint Stipulation of Dismissal of the consolidated enforcement action in the Southern District of New York (No. 23 Civ. 05488), and the case is now closed. On July 18, 2024, the parties filed Joint Stipulations of Dismissal to resolve the cases pending in the Civil Court of Rome (No. 74775/2017), the Rome Court of Appeals (Nos. 6536/2022 and 5033/2023), and the Italian Supreme Court of Cassation (Nos. 26719/2022 and 856/2024). The Italian courts are expected to issue orders declaring that the cases are closed in the coming weeks.

Sony/Universal/Warner Copyright Litigation
In March 2021, Sony Music Entertainment Italy (a subsidiary of Sony Music Entertainment Group), Warner Music Italia (a subsidiary of Warner Music Group), Universal Music Italia (a subsidiary of Universal Music Group), and Warner Music International Services (a subsidiary of Warner Music Group) filed a lawsuit against Vimeo in the Court of Milan alleging violations of Italian copyright and unfair competition laws. See Sony Music Entertainment Italy s.p.a. et al. v. Vimeo, Inc., Case No. 10977/2021 (Court of Milan, Business Division). The complaint alleges that Vimeo infringed plaintiffs' copyrights by hosting and streaming user-uploaded videos that contain plaintiffs' copyrighted works and that, upon notification of the alleged infringement, Vimeo employed a takedown process that did not comply with Italian law. The complaint seeks, among other things, injunctive relief and damages to be quantified in a separate proceeding. Additionally, the complaint seeks potential penalties of €10,000 per day of delay in removing unauthorized works after receipt of a court order to do so, if applicable. On November 3, 2021, Vimeo filed its initial brief. On November 23, 2021, the parties attended the initial hearing with the Court of Milan where the court set forth a briefing schedule. The parties have exchanged briefs, and the hearing scheduled for June 26, 2024 was postponed to October 16, 2024.
20
VIMEO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
NOTE 10—RELATED PARTY TRANSACTIONS
Vimeo has entered into various sublease agreements with a subsidiary of Angi Inc., an indirect subsidiary of IAC, whereby Vimeo agreed to sublease a portion of the 5th floor and the entire 10th floor at 330 West 34th Street ("West 34th Street Sublease") in New York City, both through April 2028. At June 30, 2024 and December 31, 2023, Vimeo had a current lease liability of $2.5 million and $2.3 million included in "Accrued expenses and other current liabilities," respectively, and a non-current lease liability of $9.4 million and $10.7 million included in "Other long-term liabilities," respectively, related to the West 34th Street Sublease in the accompanying consolidated balance sheet. Rent expense for the three and six months ended June 30, 2024 and 2023 were both $0.8 million and $1.7 million, respectively.
NOTE 11—RESTRUCTURING
During the quarters ended March 31, 2024 and 2023, the Company completed evaluations to sufficient levels of detail to commit to restructuring plans that resulted in reductions to its workforce of approximately 4% and 11% of its employees, respectively. One-time termination benefits provided as part of the restructuring plans include severance, continuation of health insurance coverage and other benefits for a specified period of time, which resulted in $2.2 million and $4.9 million of restructuring costs for the six months ended June 30, 2024 and 2023, respectively.
Costs related to these restructuring plans have been recognized in the accompanying consolidated statement of operations as follows:
 Six Months Ended June 30,
 20242023
 (In thousands)
Restructuring costs:
Cost of revenue$88 $298 
Research and development expense116 2,813 
Sales and marketing expense1,104 1,078 
General and administrative expense897 699 
Total$2,205 $4,888 
At June 30, 2024, a payable of $0.2 million related to restructuring costs was included in "Accrued expenses and other current liabilities" in the accompanying consolidated balance sheet.
21
Item 2.    Management's Discussion and Analysis of Financial Condition and Results of Operations for Vimeo

GENERAL
Management's Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the Vimeo consolidated financial statements for the three and six months ended June 30, 2024 included in "Item 1—Consolidated Financial Statements."
Operating Metrics and Key Terms:
Three Months Ended June 30,Six Months Ended June 30,
20242023% Change20242023% Change
(In thousands, except ARPU)
Self-Serve & Add-Ons:
Subscribers1,304.6 1,432.0 (9)%1,304.6 1,432.0 (9)%
Average Subscribers1,326.6 1,455.2 (9)1,342.1 1,468.5 (9)
ARPU$208 $195 6 $207 $196 6 
Bookings$67,904 $74,789 (9)$134,770 $146,163 (8)
Vimeo Enterprise:
Subscribers3.7 2.8 33 3.7 2.8 33 
Average Subscribers3.7 2.6 40 3.5 2.5 40 
ARPU$21,977 $19,672 12 $22,109 $19,727 12 
Bookings$23,433 $18,205 29 $43,368 $31,736 37 
Other:
Subscribers57.0 77.6 (27)57.0 77.6 (27)
Average Subscribers58.7 80.6 (27)62.0 85.5 (27)
ARPU$1,080 $901 20 $1,048 $909 15 
Bookings$9,144 $11,296 (19)%$20,473 $24,151 (15)%
When the following terms appear in this Management's Discussion and Analysis of Financial Condition and Results of Operations for Vimeo, they have the meanings indicated below:
•Self-Serve & Add-Ons relates to our subscription plans sold directly online, and any add-on services tied to those online subscriptions. This includes our Starter, Standard, and Advanced subscription plans, and add-on services such as bandwidth charges, which are sold through our sales force to subscribers of one of our plans if they exceed a certain threshold of bandwidth.
•Vimeo Enterprise relates to our video offering designed for teams and organizations, which includes the same capabilities of Self-Serve & Add-Ons plus enterprise-grade features such as advanced security, custom user permissions, single-sign on for employees, interactive video tools, and marketing software integrations. Vimeo Enterprise is sold through our sales force and is often an upgrade from Vimeo's Self-Serve & Add-Ons as the number of users or use cases in an organization grows.
•Other relates to products and services we offer outside of Self-Serve & Add-Ons and Vimeo Enterprise, primarily our over-the-top ("OTT") video monetization solution that allows customers to launch and run their own video streaming channel directly to their audience through a branded web portal, mobile apps and Internet-enabled TV apps. Other also includes Magisto, Livestream, Wibbitz, and WIREWAX.
•Subscribers is the number of users who have an active subscription to one of Vimeo's paid plans measured at the end of the relevant period. Vimeo counts each customer with a subscription plan as a subscriber regardless of the number
22
of users. In the case of customers who maintain subscriptions across Self-Serve & Add-Ons, Vimeo Enterprise, and Other, Vimeo counts one subscriber for each of the components in which they maintain one or more subscriptions. Vimeo does not count users or team members who have access to a subscriber's account as additional subscribers.
•Average Subscribers is the sum of the number of Subscribers at the beginning and at the end of the relevant measurement period divided by two.
•Average Revenue per User ("ARPU") is the annualized revenue for the relevant period divided by Average Subscribers. For periods that are less than a full year, annualized revenue is calculated by dividing the revenue for that particular period by the number of calendar days in the period and multiplying this value by the number of calendar days in that year.
•Bookings consists of fixed fees for SaaS services, measured at the end of the relevant period, that subscribers have paid or committed to pay during their subscription period or 12 months, whichever is shorter, less refunds and chargebacks during the same period.
•Gross Margin is revenue less cost of revenue, divided by revenue.
•Cost of Revenue consists primarily of hosting fees, credit card processing fees, compensation expense and other employee-related costs, and stock-based compensation expense for personnel engaged in customer care functions, traffic acquisition costs, which includes in-app purchase fees, outsourced customer care personnel costs, rent expense and facilities costs.
•Research and Development Expense consists primarily of compensation expense and other employee-related costs and stock-based compensation expense that are not capitalized for personnel engaged in the design, development, testing and enhancement of product offerings and related technology, software license and maintenance costs, rent expense and facilities costs.
•Sales and Marketing Expense consists primarily of advertising expenditures, which include online marketing, including fees paid to search engines, social media sites, e-mail campaigns, display advertising, video advertising and affiliate marketing, and offline marketing, which includes conferences and events, compensation expense and other employee-related costs, and stock-based compensation expense for Vimeo's sales force and marketing personnel, software license and maintenance costs, rent expense and facilities costs.
•General and Administrative Expense consists primarily of compensation expense and other employee-related costs and stock-based compensation expense for personnel engaged in executive management, finance, legal, tax, information technology and human resources, provision for credit losses, fees for professional services, rent expense, facilities costs, software license and maintenance costs, and business insurance.
•Credit Facility is the $100 million revolving credit facility entered into on February 12, 2021 by Vimeo.com, Inc., which was terminated in accordance with its terms effective June 30, 2023.
•Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("Adjusted EBITDA") is a non-GAAP financial measure. See "Principles of Financial Reporting" for the definition of Adjusted EBITDA and a reconciliation of net earnings to Adjusted EBITDA, for the three and six months ended June 30, 2024 and 2023.

23
MANAGEMENT OVERVIEW
Vimeo is the world's leading all-in-one video software solution, providing the full breadth of video tools through a software-as-a-service model. Vimeo's comprehensive and cloud-based tools empower its users to create, collaborate and communicate with video on a single, turnkey platform.
Sources of Revenue
Vimeo's revenue is derived primarily from SaaS subscription fees paid by customers for subscription plans. Revenue is recognized on a straight-line basis over the contractual term of the arrangement beginning on the date that the service is made available to the customer. Subscription periods generally range from one month to three years with the most common being an annual subscription and are generally non-cancellable.
Distribution, Marketing and Advertiser Relationships
Vimeo pays to market and distribute its services on third-party search engines and social media websites, and through e-mail campaigns, display advertising, video advertising and affiliate marketing. Vimeo also pays traffic acquisition costs, which consist of fees paid to Apple and Google related to the distribution and the facilitation of in-app purchases of product features. These distribution channels might also offer other third parties services and products, which compete with those Vimeo offers.
Vimeo also markets and offers its services and products through branded websites, allowing customers to transact directly with it in a convenient manner.
24
Results of Operations for the three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023
Results of operations for the periods presented as a percentage of our revenue are as follows:
Three Months Ended June 30,Six Months Ended June 30,
 2024202320242023
 (as a % of revenue)
Revenue100 %100 %100 %100 %
Cost of revenue (exclusive of depreciation shown separately below)22 22 22 23 
Gross profit78 78 78 77 
Operating expenses:
Research and development expense26 26 26 28 
Sales and marketing expense27 39 29 39 
General and administrative expense18 7 18 8 
Depreciation — — — 1 
Amortization of intangibles— 1 — 1 
Total operating expenses71 73 73 76 
Operating income7 5 5 1 
Interest expense — (1)— — 
Other income, net4 3 4 3 
Earnings before income taxes11 7 8 3 
Income tax provision(1)(1)(1)(1)
Net earnings10 %6 %8 %3 %
Revenue
 Three Months Ended June 30,Six Months Ended June 30,
 20242023Change% Change20242023Change% Change
 (In thousands)
Self-Serve & Add-Ons$68,565 $70,821 $(2,256)(3)%$138,477 $142,423 $(3,946)(3)%
Vimeo Enterprise20,051 12,899 7,152 55 38,518 24,471 14,047 57 
Other15,760 18,115 (2,355)(13)32,291 38,523 (6,232)(16)
Total revenue$104,376 $101,835 $2,541 2 %$209,286 $205,417 $3,869 2 %
For the three months ended June 30, 2024 compared to the three months ended June 30, 2023
Revenue increased $2.5 million, or 2%, due primarily to an increase of $7.2 million, or 55%, in Vimeo Enterprise, partially offset by decreases of $2.4 million, or 13%, in Other and $2.3 million, or 3%, in Self-Serve & Add-Ons.
The increase in Vimeo Enterprise was primarily due to increases of 40% and 12% in Average Subscribers and ARPU, respectively. The decrease in Other was a result of the Company actively deprecating a number of products in this category. The decrease in Self-Serve & Add-Ons was due primarily to a decrease of 9% in Average Subscribers, partially offset by an increase of 6% in ARPU.
For the six months ended June 30, 2024 compared to the six months ended June 30, 2023
Revenue increased $3.9 million, or 2%, due primarily to an increase of $14.0 million, or 57%, in Vimeo Enterprise, partially offset by decreases of $6.2 million, or 16%, in Other and $3.9 million, or 3%, in Self-Serve & Add-Ons.
25
The increase in Vimeo Enterprise was primarily due to increases of 40% and 12% in Average Subscribers and ARPU, respectively. The decrease in Other was a result of the Company actively deprecating a number of products in this category. The decrease in Self-Serve & Add-Ons was due primarily to a decrease of 9% in Average Subscribers, partially offset by an increase of 6% in ARPU.

Cost of revenue (exclusive of depreciation shown separately below) and Gross profit
 Three Months Ended June 30,Six Months Ended June 30,
 20242023Change% Change20242023Change% Change
 (In thousands)
Cost of revenue (exclusive of depreciation shown separately below)$22,678 $22,845 $(167)(1)%$46,121 $46,517 $(396)(1)%
Gross profit$81,698 $78,990 $2,708 3 %$163,165 $158,900 $4,265 3 %
Gross margin78%78%78%77%
For the three months ended June 30, 2024 compared to the three months ended June 30, 2023
Cost of revenue decreased $0.2 million, or 1%, due primarily to a decrease in credit card processing fees of $0.9 million driven by lower bookings from Self-Serve & Add-Ons, partially offset by an increase in hosting costs of $0.6 million.
Gross profit increased $2.7 million, or 3%, due primarily to the increase in revenue.
For the six months ended June 30, 2024 compared to the six months ended June 30, 2023
Cost of revenue decreased $0.4 million, or 1%, due primarily to a decrease in credit card processing fees of $1.1 million driven by lower bookings from Self-Serve & Add-Ons, partially offset by an increase in hosting costs of $0.6 million.
Gross profit increased $4.3 million, or 3%, due primarily to the increase in revenue.
Operating Expenses
 Three Months Ended June 30,Six Months Ended June 30,
 20242023Change% Change20242023Change% Change
 (In thousands)
Research and development expense$26,972 $26,676 $296 1 %$55,107 $57,936 $(2,829)(5)%
Sales and marketing expense27,676 39,764 (12,088)(30)59,981 79,751 (19,770)(25)
General and administrative expense19,087 6,943 12,144 175 37,121 16,249 20,872 128 
Depreciation 154 102 52 52 211 1,030 (819)(80)
Amortization of intangibles348 910 (562)(62)695 2,144 (1,449)(68)
Total operating expenses$74,237 $74,395 $(158)— %$153,115 $157,110 $(3,995)(3)%
For the three months ended June 30, 2024 compared to the three months ended June 30, 2023
Research and development expense increased $0.3 million, or 1%, due primarily to increased investment in products of $1.0 million, partially offset by a decrease of $0.7 million in stock-based compensation expense due to executive turnover in 2023.
Sales and marketing expense decreased $12.1 million, or 30%, due primarily to a decreases of $8.0 million in advertising costs as we reduced underperforming spend and shifted to a more organic customer acquisition approach, $2.3 million in stock-based compensation expense driven by executive turnover in 2024, and $1.9 million in compensation expense and other employee-related costs driven by lower headcount.
26
General and administrative expense increased $12.1 million, or 175%, due primarily to an increase of $12.1 million in stock-based compensation expense driven by executive turnover in 2023.
Depreciation was nearly flat compared to the prior year period.
Amortization of intangibles decreased $0.6 million, or 62%, due primarily to certain intangible assets reaching the end of their estimated useful lives in the second quarter of 2023.
For the six months ended June 30, 2024 compared to the six months ended June 30, 2023
Research and development expense decreased $2.8 million, or 5%, due primarily to decreases of $2.7 million in restructuring costs driven by a reduction-in-force that was completed in the first quarter of 2023 and $1.8 million in stock-based compensation expense due to executive turnover in 2023, partially offset by increased investment in products of $1.7 million.
Sales and marketing expense decreased $19.8 million, or 25%, due primarily to decreases of $15.0 million in advertising costs as