RTHM.L Regulatory News (RTHM)

Third Quarter Trading Update

London, England and San Francisco, CA. - 14 January 2016 - blinkx PLC ("blinkx" or the "Company"), today updates the market on its performance for the third quarter of financial year 2016, covering the period from 1 October 2015 to 31 December 2015 ("Q3 2016" or "the Period"). As announced previously, the Company will continue to provide trading updates on a quarterly basis.

Financials

Based on preliminary, unaudited results, Q3 2016 revenue performance was in line with management expectations, during the seasonally strongest quarter of the financial year. Core products continued to ramp and offset declines in Non-Core products, while management continued to rationalize the Company's cost structure during the Period. As a result of the progress made on revenues and cost reduction actions, profitability in Q3 2016 was ahead of management expectations, achieving break-even on an adjusted* EBITDA basis during the Period.

Products

As noted in the last trading update of 9 October 2015, the Company continued to accelerate investments in its Core mobile, video and programmatic capabilities, with particular emphasis on ramping its unified programmatic platform. During the Period, blinkx continued to integrate its platform with several dominant programmatic demand and supply partners. Programmatic revenues grew rapidly throughout Q3 2016, setting a new 3-month performance benchmark, which was ahead of management expectations.

Market

The market continues to show evidence of strong sectoral growth and an accelerating pace of consolidation. According to eMarketer, US digital ad spend is anticipated to grow from $58B in 2015 to $67B in 2016, led by increases in mobile, video and programmatic budgets. Of particular note, programmatic spending is expected to surge by 40% in 2016, reaching $21.5B and accounting for 67% of total digital display ad spending. Against this backdrop, however, the market continues to polarize between entities that provide an integrated offering and are gaining share, at the expense of point solutions that face challenges of scale and scope, and will need to consolidate in order to compete and succeed.

Outlook

"We are pleased to provide an update on our third quarter trading, with adjusted* EBITDA performance ahead of management expectations," said S. Brian Mukherjee, CEO of blinkx. "Our focus on Core mobile, video and programmatic products, and exit of Non-Core product lines, is fully aligned with broader structural market trends. In addition, we continue to take cost reduction measures, which have begun to positively impact our path to profitability."

Non-GAAP Measures

· This press release contains references to adjusted* EBITDA. This financial measure is not a measure that has any standardized meaning prescribed by IFRS and is therefore referred to as a non-GAAP measure. The non-GAAP measures used by blinkx may not be comparable to similar measures used by other companies.

· Adjusted* EBITDA is defined as profit for the year attributable to equity holders of the parent before interest, taxes, depreciation and amortization, stock based compensation expense, and acquisition and exceptional costs. Management believes that this measure is a useful supplemental metric as it provides an indication of the results generated by the Company's principal business activities prior to consideration of how the results are impacted by one time exceptional charges, how the results are taxed in various jurisdictions, or how the results are affected by the accounting standards associated with the Group's stock based compensation plan.

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About blinkx

blinkx (LSE AIM: BLNX) is an Internet media company that connects consumers and brands through premium content online. Founded in 2004 in the UK, blinkx pioneered Internet Video Search using its patented COncept Recognition Engine (CORE). This technology leverages speech recognition, text and image analysis to deeply understand the meaning and context of video content to generate improved search relevancy for consumers and a brand safe environment for advertisers. Through its partnerships with hundreds of media companies, including NBC, Conde Nast, Reuters and Bloomberg, blinkx has indexed and search enabled millions of hours of video content. blinkx powers video search, discovery or monetization on thousands of online properties including Lycos, Discovery Networks, Hallmark and Fox Sports. blinkx is headquartered in San Francisco, California with offices worldwide. For more information please visit www.blnx.com.