Good day, ladies and gentlemen and welcome to the Q1 2013 comScore Incorporated Earnings Conference Call. My name is Clinton, and I'll be your operator for today. [Operator Instructions] As a reminder, the call is being recorded for replay purposes. I'd now like to turn the call over to Ken Tarpey, CFO. Please proceed, sir.

Thank you, Clinton. Good afternoon, everyone, and welcome to comScore's earning call for the first quarter of 2013. Again, I'm Ken Tarpey, the CFO of comScore. And with me today is Magid Abraham, our President, CEO and Co-Founder; Serge Matta, our President of Commercial Solutions; and Cameron Meierhoefer, our Chief Operating Officer. Before we begin, please allow me to read the following disclaimer regarding our use of forward-looking information and non-GAAP financial measures. During the course of today's call, as well as during any question-and-answer periods that may follow, representatives of the company may make forward-looking statements within the meaning of the Security Act of 1933 and the Securities Exchange Act of 1934 regarding future events or performance of the company that involve risks and uncertainties, including, without limitation, the strength of comScore's business; expectations as to opportunities, including new customers and markets for comScore; expectations as to the growth and composition of comScore's customer base and renewal rates; expectations regarding the impact and benefits of particular lines of business and products; expectations regarding the disposition of certain lines of business; expectations regarding the relative quality of comScore's products; assumptions regarding tax rates and net operating loss carryforwards; and forecasts of future financial performance for the second quarter and the full year of 2013, including related growth rates, exchange rates and assumptions. Such statements are only predictions based on management's current expectations. Actual events or results could differ materially from those predictions due to a number of risks and uncertainties, including those identified in the documents comScore files from time to time with the Securities and Exchange Commission. Those documents specifically include, but are not limited to, comScore's Form 8-K filed earlier today relating to this call; comScore's Form 10-K for the period ending December 31, 2012. We caution you not to place undue reliance on any forward-looking statements included in these presentations, which speak only as of today. We do not undertake any obligation to publicly update any forward-looking statements to reflect new information after today's call or to reflect the occurrence of unanticipated events. In addition, we may also reference certain non-GAAP financial measures in the course of our presentation. You will find in our press release and on our Investor Relations website, a reconciliation of non-GAAP financial measures discussed during today's call to the most directly comparable GAAP financial measure. For the link to our Investor Relations website is ir.comscore.com, and our results are posted under Press Releases. With that, I will now turn the call over to Magid.

Thank you, Ken, and thank you for joining us today. Let me first cover some highlights of the quarter, and then Ken will provide some more detail on our financial performance. We also have some slides posted on our IR website that accompany our comments today and it might be useful for you to follow along with us. During our fourth quarter 2002 earnings call back in February, we outlined 4 key priorities for comScore in 2013. Number one is to maintain our measurement leadership, especially in mobile and multi platform; number two is to continue our campaign measurement progress and rollout globally; number three, capitalize on the Digital Analytix momentum; and number four, focus on executions, particularly driving to improve margins and to increase free cash flow. I'm happy to say that we are making progress on all 4 priorities. This progress helped us deliver strong results for the first quarter of 2013. We reported record quarterly revenues of $68.8 million, which is up 11% over the first quarter of last year. On a non-GAAP pro forma basis, excluding the financial performance of our non-health copy testing and configuration manager products, which we divested during the quarter, revenue grew 12% to $67.5 million. Our record revenues were driven by the continued strength in our Audience Analytics business with notable contribution from our mobile and multi-platform products. Our momentum in campaign measurement has never been stronger. We're also pleased with the marketplace momentum of our enterprise Digital Analytix software and the status of early implementations of deals sold last year. Finally, our execution was laser-sharp and delivered better than expected margins and record free cash flow. Despite our seasonally lower margins in the first quarter, our focus on execution and operating leverage resulted in 19% adjusted EBITDA margin, representing an…

Thank you, Magid. Good afternoon, everyone. Let's take a look at our performance for the first quarter in more detail starting with revenues. As Magid mentioned, reported revenue for the first quarter was a quarterly record of $68.8 million, up 11% year-over-year. On a non-GAAP pro forma basis, excluding the financial performance of our non-health copy testing and configuration manager products, which we divested in the quarter, revenue grew 12%. Subscription revenue in the first quarter was $59.4 million, up 14% year-over-year, 15% on a pro forma basis. Subscription revenue represented 86% of total revenue or 87% on a pro forma basis while project revenue was $9.4 million. Project revenue as a percentage of revenue was somewhat lower, primarily due to the seasonal nature of project work with our customer base. GAAP revenue from existing customers was up 8% year-over-year in the first quarter to $60.8 million and represented 88% of total revenues. On a pro forma basis, existing customer revenue in the first quarter of 2013 was up 9% year-over-year. Our renewal rate with existing customers remained above the 90% on a constant dollar basis and we added 62 net new customers in the first quarter. Our customer count now totals 2,206 customers. And we continue to increase our international revenues. In the first quarter, revenue from outside the United States was up 27% on a pro forma basis and represented 30% of revenue, driven by the strength of our audience products particularly in Europe and Latin America. On a constant currency basis, our pro forma revenue would have been $200,000 higher with the British pound and euro fluctuations being the primary reasons. Our top 10 customers represented 23% of pro forma revenue in the first quarter, reflecting the continued diversification of our overall customer base. Now, let me…

[Operator Instructions] Your first question comes from the line of Jason Helfstein from Oppenheimer and Company. Jason S. Helfstein - Oppenheimer & Co. Inc., Research Division: Why aren't you treating the copy testing as discontinued operations? Just because I think it kind of makes the ratio analysis confusing through the whole income statement since we're obviously -- it's excluded from the guidance and excluded in all the analysis. The second question, we're clearly seeing a take-up in vCE. Can you just talk about how that's impacting kind of all the other businesses? Are you seeing a greater take-up in any products around mobile or social or any of your custom products because of the momentum you're seeing in vCE?

This is Ken, let me just take the first one to clarify that and that I'll open it up to the rest of the colleagues to take the second one. As it relates to the divestiture, we did hold on to or keep the health focus portion of those products. So since we did not divest of the entire business, under the accounting rules, you're not allowed to do divestiture accounting. And that's why be provided that supplemental information for everybody's benefit so we have comparability as best as we can on a go-forward basis.

With regards to vCE momentum, I think we're very, very happy with the way it's going and we see actually, momentum even within the quarter accelerating. And you're right, it is really opening doors for us as far as people interested in multi platform, in terms of mobile. Just basically when you are talking to advertisers, it open up the door for addressing a whole bunch of marketing questions and gives us the opportunity to cross-sell other products. So like anything, anything that gets you a foot in the door and get you engaged in a serious conversation with the client, is actually going to turn out to be very beneficial and synergistic. Jason S. Helfstein - Oppenheimer & Co. Inc., Research Division: So is it fair to say, just a follow-up, just given how the businesses has gotten more and more weighted toward the fourth quarter with renewals, we would see more of that benefit next year or when you post the fourth quarter, is that a fair way to think about it?

I think it will skew more towards the fourth quarter but I think we'll see the benefit gradually as we go through the year. In some cases, people are not going to wait until the fourth quarter to upgrade and buy the mobile product or the multi-platform product, et cetera.

Our next question comes from the line of Youssef Squali of Cantor Fitzgerald. Kip N. Paulson - Jefferies & Company, Inc., Research Division: This is Kip Paulson for Youssef. Just a couple of quick questions. First, could you talk a bit about bookings or contract value growth for Audience Analytics versus advertising analytics, web analytics and the mobile and network analytics? And which of these categories has the widest spread between pro forma bookings growth and pro forma reported revenue growth? And I have one follow-up.

This is Ken, I'll start it off. In terms of the spread overall, as we mentioned in the past, we've shown in the chart in prior calls, the subscriber analytics has the longest lead time with the longest gap. Then the second one, as I mentioned in the call at this point, would be the vCE because it is dependent on timing of campaigns. But we are seeing, to the prior comments by Magid that, that gap is closed -- closing during this past quarter. The audience products, fairly consistent, as always, as ratable products in terms of the recognition and really, no gap from that perspective. On the DAx side, we had seen a bit more of a gap that is starting to close as our base increases and we really will be on the vCE side and the DAx side is where we'll see that gap continue to close over the course of the year as we look at things. Kip N. Paulson - Jefferies & Company, Inc., Research Division: Got it, great. And then it looks like you guys added a better-than-expected 62 customers in the quarter. Were there any onetime additions in here, if you will, or should we consider adding more of the typical 45 to 50 customers per quarter?

No. This is Serge. No, there were no onetime customers or anything like that. These were for the most part, I don't think we saw any of that, so you should expect that, so definitely not anything in regard to onetime customers.

The next question comes from the line of Heath Terry of Goldman.

I was wondering if you could give us an update on the ESPN cross-platform measurement program, what kind of traction you're seeing with that so far to the extent that there are any partners outside of ESPN that have started to join into the program? And how, if at all, the Arbitron acquisition impacts that program.

Let me try to answer that, Heath. The ESPN project is going well. It has -- it involves cooperation between us and Arbitron. And despite the fact that Arbitron is going through this acquisition process, we're both meeting our obligations and things are on schedule. The timeframe for the project was to get done towards the end of the second quarter beginning -- or the summer time.

The summer time.

And then it would be from the summer time until the end of the year where ESPN will take a close look at the recurring numbers that are coming out of it. We have seen interest from other customers in it but I think that there is some uncertainty about what will happen depending on how the FCC rules on the pending deal between Nielsen and Arbitron. So it's too early to predict how that's going to go. Other than that, we are happy with the progress and with the method that we are using and we're looking forward to getting out some way of continuing the cooperation with Arbitron after the deal is adjudicated one way or the other.

That's great. I guess just one sort of follow-up question. When you look at the rollout of new mobile products that you've seen over the course of the last year or so and the expansion that you guys have done to the mobile panel, when you think about sort of the -- where you are in terms of measuring mobile, how would you compare it or how would you compare it to where you are in desktop now and maybe where you were in desktop a few years ago? I mean, I guess, what I'm thinking is are we, in 2013, with mobile, where we were with desktop in 2002 or 2005? How do you see it that way? And then would you say mobile now is kind of 50% of where desktop is now or what's the best way to sort of think about that, I guess, both from a business and maybe from a products standpoint?

Well, I think, from a sample size standpoint in the U.S., we have actually gotten to the point where our sample is at least as good as what desktop was in the early 2000s. And so we believe we have a pretty strong basis for that measurement. The complexity of measuring mobile revolves around apps. And the app ecosystem is very diverse. And so with the apps, we have lost some of the open nature of the Internet measurement where you have a standardized URL that you can track and report. But this is something that we're working through and we are working -- we're leveraging some of the progress that we're making for subscriber analytics to get our hands on international data for mobile.

The only other thing I just want to add, Heath, is in terms of numbers, we have significantly enhanced our mobile offerings. So just -- we announced this a few weeks -- a few months a go but in terms of data collection in the U.S., we now collect data on over 1 million smartphones, 400,000 tablets and 150,000 connected devices. And also, in Q1 in March, we launched a tablet measurement service for -- called TabLens that we are now providing to our customers. So we definitely expanded and invested a lot in our mobile offering.

[Operator Instructions] Our next question comes from the line of Matt Chesler of Deutsche Bank.

Can you address the broader economic client tone across your client base including the trends in the near-term prospects for your project revenue? It was helpful to see the pro forma breakout, to see that the decline in product revenue pro forma was smaller than the reported revenue. I just want to get a sense for where you see that headed over the coming quarters and contributing to your full year plan?

Well, we always see a sequential drop in project revenue from Q4 to Q1, just due to end of year effects, people that have money left over in their budgets. But so far so good. We see good customer activity and good discretionary spending. Obviously, the areas in the world where there is tightness in spending, which tends to be around Europe, that's not the business where we have a lot of project work. Our project work tends to be in the U.S. And so from that standpoint, we think the climate is pretty good. It's not exuberant but at the same time, it's pretty healthy. So barring any unforeseen circumstances, we are bullish on the level of project revenue this year.

So year-over-year it declined 4%, you see that snapping back to growth in the next quarter?

I don't know about the next quarter but definitely within -- like I said, we see an uptick, Matt, in the fourth quarter. We'll see an uptick in the fourth quarter, but it's hard to tell in terms of exact uptick in Q2. But like Magid said, we're not seeing anything concerning -- to concern us in Q1 and at least in the U.S. And most of the projects anyway, like he said, is in the U.S. So it doesn't really affect us. If there's going to be things that happen in Europe and elsewhere, it doesn't really impact project revenue.

Okay. And if you look at those 62 net adds for customers, can you give us -- can you breakdown the parts of your business you're seeing those increases in?

In terms of the -- as always, the initial entry point most usually for our customers is on the audience side. We are seeing more of it internationally.

Yes, we're seeing audience, we're seeing international, we're also seeing some DAx clients that come in that are not audience clients, which is an interesting trend that we started seeing. We started seeing that in late Q3 and then saw in Q4, and it's also continued. So clients that are not Media Metrix clients or have any relationship with comScore end up becoming into the -- signing up for DAx as well.

Okay. And then just lastly, you're having -- you're showing good traction in vCE. Just back in your audience business, one of your competitors talked about deemphasizing the planning aspect of the business. Have you seen -- do you have the information to know if you've picked up any business directly as a result of that? Are you gaining market share in that area?

Well, we know we're gaining some market share in some of the countries that they have decided to abandon, that's one thing for sure. The second thing that we've gained is Media Metrix Multi-Platform is a competitive -- is a very compelling offering that there's no competitive offering out there. And in that Media Metrix MP, just to give everybody on the call some stats, we signed our 100th Media Metrix Multi-Platform subscription in Q1. We now total around 123 customers through Q1. Our ASP for multi-platform is up 15% versus the fourth quarter. We have major new subscribers in Q1 including Facebook, Viacom, Time Warner, NBC, Twitter, Guardian, IAC. And this is the most -- the last point I want to make is the most really compelling point about Media Metrix Multi-Platform is it is generating new cross-sell opportunities. So when we sell Media Metrix Multi-Platform, 43% of all of the sales in Q1 2012, Q1 -- sorry, 2013, also bought Mobile Metrix or Video Metrix. So this extra revenue creates a positive multiplier effect to the MP upsell. So it's really helping us not only to upsell clients but it's also helping us upsell additional products.

We have no questions left at this time. I'd now like to turn the call back over to Dr. Abraham for closing remarks.

Thanks. Well, thank you, all, for your participation today. We believe we're off to a strong start for the year and we're well positioned to deliver improved top line growth in 2013, drive operational efficiencies and simultaneously deliver increased profit margin and strong free cash flow. Additionally, I wanted to make you aware that we're very excited about hosting an Investor Day on Monday, June 3, in New York. We have a slide here that includes the invitation. And our plans are to discuss the company's business and its prospects in more depth and give you an update since the last investor meeting about 3 years ago. So please be certain to mark your calendars and I hope we will be able to see many of you there. Otherwise, we look forward to speaking with you again on the next conference call. Thank you very much.

Okay. Ladies and gentlemen, that concludes your conference call for today. You may now disconnect. Thank you for joining. Have a very good day.