TechTarget said in a press release that it has “identified an improper accounting practice relating to certain customer credits that were improperly eliminated as liabilities on the company's balance sheet.” The company said expenses were understated by about $353,000 in 2007 and $426,000 in 2008 and overstated by $15,000 this year.
“The company currently believes that the improper accounting practice was limited to a single individual,” TechTarget said in a press release.
The company had previously restated some financial results for 2008 and 2009 due to inconsistencies regarding when webcast revenue was recognized.
TechTarget said estimated revenue for the third-quarter totaled $23.3 million, compared with $25.2 million in the same period last year. Estimated adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) totaled $5.3 million.
The company expects fourth-quarter revenue to total between $21.8 million and $22.8 million. It expects adjusted EBITDA to be between $4.5 million to $5.3 million, “excluding costs associated with the investigation into the accounting matter.”
“Things have definitely stabilized. So it's really just a matter of when that recovery starts. So we just don't have clear visibility when that is,” Greg Strakosch said in a conference call discussing the earnings report.