(2) The three months ended March 31, 2023, includes $7.0 million loss from a mark-to-market adjustment of contingent consideration associated with the World Programming acquisition and $1.8 million currency gains on acquisition-related intercompany loans. The three months ended March 31, 2022, includes $1.5 million currency losses on acquisition-related intercompany loans.
The following table provides a reconciliation of Adjusted EBITDA to net (loss) income, the most comparable GAAP financial measure:
| (Unaudited) | ||||||||
|
Three Months Ended
March 31, | ||||||||
| (in thousands) | 2023 | 2022 | ||||||
| Net (loss) income | $ | (1,959 | ) | $ | 11,528 | |||
| Income tax expense | 9,232 | 6,530 | ||||||
| Stock-based compensation expense | 22,161 | 18,614 | ||||||
| Interest expense | 1,526 | 585 | ||||||
| Depreciation and amortization | 9,750 | 7,686 | ||||||
| Special adjustments, interest income and other(1) | 2,345 | 1,647 | ||||||
| Adjusted EBITDA | $ | 43,055 | $ | 46,590 | ||||
(1) The three months ended March 31, 2023, includes $7.0 million loss from a mark-to-market adjustment of contingent consideration associated with the World Programming acquisition, $2.9 million of interest income, and $1.8 million currency gains on acquisition-related intercompany loans. The three months ended March 31, 2022, includes $1.5 million currency losses on acquisition-related intercompany loans.
The following table provides a reconciliation of Free Cash Flow to net cash provided by operating activities, the most comparable GAAP financial measure:
| (Unaudited) | ||||||||
|
Three Months Ended
March 31, | ||||||||
| (in thousands) | 2023 | 2022 | ||||||
| Net cash provided by operating activities(1) | $ | 59,199 | $ | 5,786 | ||||
| Capital expenditures | (1,727 | ) | (2,190 | ) | ||||
| Free cash flow (1) | $ | 57,472 | $ | 3,596 | ||||
(1) The three months ended March 31, 2022, includes a $65.9 million payment in January 2022 for a damages judgement assumed as part of an acquisition in December 2021.
