Pandora 2014 Annual Report Download

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Table of contents

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  • Page 5
    .... In 2013, Pandora delivered strong financial and operational growth. At the end of the 11 months ended December 31, 2013, listener hours grew to 15.31 billion from 12.56 in 2012, and active users for the 30 day period ended December 31, 2013 increased to 76.2 million. Non-GAAP total revenue for the...

  • Page 6
    ... >À̈ÃÌà ՘`iÀÃÌ>˜`] }ÀœÜ >˜` i˜}>}i ÃŒÂ...iˆÀ v>˜ L>Ãi œ˜ *>˜`œÀ>° 2014 Goals 7i Â...>Ûi ÃŒÂ...Àii «ÀˆœÀˆÌˆià vœÀ Ã"ä£{° ˆÀÃÌ] Ãœi >Ài vÂœVÕÃi` œ˜ Vœ˜Ìˆ˜Õˆ˜} ̜ }ÀœÜ œÕÀ >V̈Ûi ˆÃÌi˜iÀà >˜` ˆÃÌi˜ˆ˜} Â...œÕÀð 7i...

  • Page 7
    ...CA (Address of principal executive offices) (510) 451-4100 (Registrant' s telephone number, including area code) 94-3352630 (I.R.S. Employer Identification No.) 94612 (Zip Code) Securities registered pursuant to section 12(g) of the Act: Name of each exchange on which registered The New York Stock...

  • Page 8
    ...063 shares of common stock outstanding. DOCUMENTS INCORPORATED BY REFERENCE Portions of the registrant's Definitive Proxy Statement relating to its 2014 annual meeting of stockholders, to be filed subsequent to the date hereof, are incorporated by reference into Part III of this Transition Report on...

  • Page 9
    ... Data Changes in and Disagreements with Accountants on Accounting and Financial Disclosure Controls and Procedures Other Information PART III Directors, Executive Officers and Corporate Governance Executive Compensation Security Ownership of Certain Beneficial Owners and Management and Related...

  • Page 10
    ... and market data contained in this Transition Report on Form 10-K are based on independent industry publications, including those generated by Triton Digital Media or "Triton" and International Data Corporation or "IDC" or other publicly available information. This information involves a number of...

  • Page 11
    ...audio systems and a range of other internet-connected devices. The majority of our listener hours occur on mobile devices, with the majority of our revenue generated from advertising on these devices. We have pioneered a new form of radio-one that uses intrinsic qualities of music to create stations...

  • Page 12
    ... generates a list of the most likely musical starting points as a listener begins to enter a favorite station, song or artist. Pandora Mobile Streaming. We have designed a sophisticated system for streaming music content to mobile devices. This system involves a combination of music coding programs...

  • Page 13
    ... vehicle models that include a native Pandora integration. Our integration into standard radio media-buying processes and measurement, our in-car advertising solutions and our local ad sales force are key elements of our strategy for expanded penetration of the radio advertising market. Subscription...

  • Page 14
    ...uses our free, non-subscription service, even if both listeners listen to the same number of performers. Musical Works Our content costs are also comprised of the royalties we pay for the public performance of musical works embodied in the sound recordings that we stream. Copyright owners of musical...

  • Page 15
    ...none of our listeners exceed. In March 2013, we instituted a 40 hour per month listening limit for our advertising supported service on certain mobile and other connected devices. Listeners who reached this limit could continue to use our ad supported service on these devices by paying $0.99 for the...

  • Page 16
    ... listeners choose to watch cable television, stream video from on-demand services or play interactive video games on their home-entertainment system, computer or mobile phone rather than listen to the Pandora service, these content services pose a competitive threat. Competition for Advertisers...

  • Page 17
    ... technologies used in internet radio from Yahoo! Inc. for $8.0 million in cash. We intend to hold these patents as part of our strategy to protect and defend Pandora in patent-related litigation. Our registered trademarks in the United States include "Pandora" and the "Music Genome Project," in...

  • Page 18
    ...and our Investor Relations website is located at investor.pandora.com. We changed our fiscal year to the calendar twelve months ending December 31 to align with the advertising industry' s business cycle, effective beginning with the period ended on December 31, 2013. As a result, our current fiscal...

  • Page 19
    ....6 million. A key element of our strategy is to increase the number of listeners and listener hours to increase our market penetration, including the number of listener hours on mobile and other connected devices. However, as our number of listener hours increases, the royalties we pay for content...

  • Page 20
    ... and operating performance fail to meet investor or analyst expectations, it could have a materially negative effect on our stock price. In addition, in our efforts to increase revenue as the number of listener hours has grown, we have expanded and expect to continue to expand our sales force. If...

  • Page 21
    ...terrestrial radio stations who traditionally have strong connections with local advertisers. We have plans that, if successfully implemented, would increase our number of listener hours on mobile and other connected devices, including efforts to expand the reach of our service by making it available...

  • Page 22
    ...growth rate we experienced in subscribers in the eleven months ended December 31, 2013 to continue. Furthermore, listeners who subscribed to Pandora One in response to the mobile listening limit may choose to cancel their subscriptions going forward and return to using our free, ad-supported service...

  • Page 23
    ...to online and mobile digital advertising markets and utilize our advertising product solutions. Continued growth could also strain our ability to maintain reliable service levels for our listeners, effectively monetize our listener hours, develop and improve our operational, financial and management...

  • Page 24
    ... online, in application stores and in consumer electronics products and automobiles, our listener hours may fail to increase as expected or decline and our advertising sales may suffer. To compete effectively, we must continue to invest significant resources in the development of our service...

  • Page 25
    ... advances in digital media delivery and predict the problems we may encounter in developing versions of our applications for these new devices and delivery channels. It may become increasingly challenging to do so in the future. In particular, the technology used for streaming the Pandora service in...

  • Page 26
    ... in the media buying systems that media buyers use to purchase advertising. Media buying companies receive measurement metrics from third parties, such as Triton for internet radio and Arbitron and Nielsen for more traditional media like terrestrial radio and television. Media buying companies may...

  • Page 27
    ... recordings that we stream. As described in "Business-Content, Copyrights and Royalties-Musical Works" to secure the rights to publicly perform musical works embodied in sound recordings over the internet, we obtain licenses from or for the benefit of copyright owners and pay royalties to copyright...

  • Page 28
    ...the number of sound recordings that we perform on our service may be reduced, our content acquisition costs may increase and our ability to retain and expand our listener base could be adversely affected, any of which could adversely affect our business, financial condition and results of operations...

  • Page 29
    ... sound recording copyright owners for the reproduction and public performance of pre-1972 sound recordings, then the time, effort and cost of securing such licenses directly from all owners of sound recording used on our service could be significant and could harm our business and operating results...

  • Page 30
    ... of our operations into delivery of non-music content stations involves numerous risks and challenges, including increased capital requirements, new competitors and the need to develop new strategic relationships. Growth into this new area may require changes to our existing business model and cost...

  • Page 31
    ... listeners and attract advertisers, content owners and automobile, mobile device and other consumer electronic product manufacturers to work with us, which we may not do successfully. Our brand may be impaired by a number of other factors, including service outages, data privacy and security issues...

  • Page 32
    ...advertising products are effective enough to justify a pricing structure that is profitable for us; • our ability to effectively manage our growth; • our ability to secure licenses for sound recordings and musical works on favorable terms; • the effects of increased competition in our business...

  • Page 33
    ...and collect royalties or other payments. We have registered "Pandora," "Music Genome Project" and other marks as trademarks in the United States. Nevertheless, competitors may adopt service names similar to ours, or purchase our trademarks and confusingly similar terms as keywords in internet search...

  • Page 34
    ... able to service our existing listeners, acquire new listeners or attract or retain advertising customers, each of which could inhibit the implementation of our business plan and materially harm our operating results. We may acquire other companies or technologies, which could divert our management...

  • Page 35
    ... to the public music on favorable terms. Expanding our operations into international markets is an element of our long-term strategy. For example, we recently began publicly performing and communicating to the public music as well as deploying advertising to listeners in New Zealand, Australia and...

  • Page 36
    ... service. For example, to register for a Pandora account, our listeners must provide the following information: age, gender, zip code and e-mail address. Listeners must also provide their credit card or debit card numbers and other billing information in connection with additional service offerings...

  • Page 37
    ... to collect, access and harness listener data, or to use or disclose listener data or any profiles that we develop using such data, would in turn limit our ability to stream personalized music content to our listeners and offer targeted advertising opportunities to our advertising customers, each...

  • Page 38
    ..., diminished public perception of our security measures and significantly higher credit card-related costs, each of which could adversely affect our business, financial condition and results of operations. If we are unable to maintain our chargeback rate or refund rates at acceptable levels, credit...

  • Page 39
    ... our ability to increase listener hours and generate ad revenue, which would harm our operating results. In addition, concerns over driver distraction due to use of mobile and other electronic devices to access our service in motor vehicles could result in litigation and negative publicity. We rely...

  • Page 40
    ... equity markets; • the number of shares of our common stock publicly owned and available for trading; • threatened or actual litigation; • changes in laws or regulations relating to our service; • any major change in our board of directors or management; • publication of research reports...

  • Page 41
    ... and in the market price of a company's securities. Such litigation, if instituted against us, could result in very substantial costs, divert our management's attention and resources and harm our business, operating results and financial condition. If securities or industry analysts cease publishing...

  • Page 42
    ... of time. In addition, if we are acquired, certain terms of our music licensing arrangements, including favorable royalty rates that currently apply to us, may not be available to an acquiror. These terms may discourage a potential acquiror from making an offer to buy us or may reduce the price such...

  • Page 43
    ... tolerance and will also support our continued growth. The data centers host the Pandora.com website and intranet applications that are used to manage the website content. The websites are designed to be fault-tolerant, with a collection of identical web servers connecting to an enterprise database...

  • Page 44
    ... reported by the NYSE. PRICE RANGE OF OUR COMMON STOCK Our common stock has traded on the NYSE since June 15, 2011. Our initial public offering was priced at $16.00 per share on June 14, 2011. High Eleven Months Ended December 31, 2013 First quarter (February 1, 2013 - April 30, 2013) Second quarter...

  • Page 45
    ... from June 15, 2011, the date our common stock commenced trading on the NYSE, through December 31, 2013 of the total cumulative return of our common stock with the total cumulative return of the New York Stock Exchange Composite Index (the "NYA Composite"), the Global X Social Media Index (the "SOCL...

  • Page 46
    ...January 31, 2010, 2011 and 2012 were derived from our audited consolidated financial statements not included in this report. The consolidated statements of operations data for the twelve months ended January 31, 2012 and 2013 for the eleven months ended December 31, 2013 and the consolidated balance...

  • Page 47
    ... 31, 2011 2012 Ele ve n months e nde d De ce mbe r 31, 2013 2012 2013 (unaudite d) (in thousands, e xce pt pe r share data) State me nt of O pe rations Data: Revenue: Advertising Subscription and other T otal revenue Cost of revenue: Cost of revenue-Content acquisition costs Cost of revenue-Other...

  • Page 48
    ...14.01 Eleven months ended December 31, 2012 12.56 2013 15.31 As of January 31, 2011 Active users 29.3 2012 47.6 2013 (in millions) 65.6 As of December 31, 2013 76.2 (2) Listener hours and active users are defined in the section entitled "Key Metrics" in Item 7 of this Transition Report on Form 10...

  • Page 49
    ...and car audio systems, as well as a range of other internet-connected devices. The majority of our listener hours occur on mobile devices, with the majority of our revenue generated from advertising on these devices. We have pioneered a new form of radio-one that uses intrinsic qualities of music to...

  • Page 50
    ... vehicle models that include a native Pandora integration. Our integration into standard radio media-buying processes and measurement, our in-car advertising solutions and our local ad sales force are key elements of our strategy for expanded penetration of the radio advertising market. In June 2013...

  • Page 51
    ...none of our listeners exceed. In March 2013, we instituted a 40 hour per month listening limit for our advertising supported service on certain mobile and other connected devices. Listeners who reached this limit could continue to use our ad supported service on these devices by paying $0.99 for the...

  • Page 52
    ... advertisers. Advertising Revenue per Thousand Listener Hours ("ad RPMs") The table below sets forth our ad RPMs, including total, traditional computer and mobile and other connected devices ad RPMs for the twelve months ended January 31, 2012 and 2013 and the eleven months ended December 31, 2012...

  • Page 53
    ... sales growth outpaced the growth in advertising-supported listener hours primarily due to an increase in the number of ads delivered, as well as an increase in the average price per ad. In addition, total ad RPMs benefited from measures we implemented in 2013 to better manage the growth of mobile...

  • Page 54
    ... as our mobile and other connected devices platforms are similar to those used to derive ad RPMs. The changes in total RPMs were driven by the same factors mentioned above within the discussion of ad RPMs. Licensing Costs per Thousand Listener Hours ("LPMs") The table below sets forth our total LPMs...

  • Page 55
    ...periods. Twelve months ended January 31, 2012 Revenue: Advertising Subscription and other Total revenue Cost of revenue: Cost of revenue - Content acquisition costs Cost of revenue - Other(1) Total cost of revenue Gross profit Operating expenses: Product development(1) Sales and marketing(1) General...

  • Page 56
    ...other revenue. Subscription and other revenue is generated primarily through the sale of a premium version of the Pandora service which currently includes advertisement-free access and higher audio quality on the devices that support it. Subscription revenue derived from direct sales to listeners is...

  • Page 57
    ... efforts to monetize the rapid adoption of our service on mobile and other connected devices, we do not validate such disaggregated metrics to the level of financial statement reporting. We continue to refine our systems and methodologies used to categorize such metrics across our delivery platforms...

  • Page 58
    ... growth in content acquisition costs outpaced the growth in revenue primarily due to an increase in listener hours in connection with the removal of the 40 hour traditional computer listening cap in September 2011. Product development Twelve months ended January 31, 2012 2013 (in thousands) $ 18,118...

  • Page 59
    ... to our website and the Pandora app, development of new advertising products and development and enhancement of our personalized station(s) generating system. We have generally expensed product development as incurred. Certain website development and internal use software development costs may be...

  • Page 60
    ... and money market funds held at major financial institutions, commercial paper, investment-grade corporate debt securities and U.S. government and government agency debt securities. In September 2013, we completed a follow-on public equity offering in which we sold an aggregate of 15,730,000 shares...

  • Page 61
    ...compensation expense. Net cash used in operating activities benefited an increase in accrued royalties of $19.3 million due to schedule rate increases and an increase in deferred revenue of $10.0 million primarily due to an increase in customers purchasing subscriptions for Pandora One, offset by an...

  • Page 62
    ... increase in deferred revenue primarily related to an increase in customers purchasing subscriptions for Pandora One, offset by an increase in accounts receivable of $24.5 million driven by an increase in revenue. Investing activities In the eleven months ended December 31, 2013, net cash used...

  • Page 63
    ...our business will be more pronounced in calendar years ended after December 31, 2013. The growth in listener hours on mobile and other connected devices was tempered in the eleven months ended December 31, 2013 by the implementation of the mobile listening limit for our advertising supported service...

  • Page 64
    ... advertisement-free access and higher audio quality on supported devices. Subscription revenue derived from direct sales to listeners is recognized on a straight-line basis over the duration of the subscription period. Subscription revenue derived from sales through some mobile operating systems...

  • Page 65
    ... including, but not limited to, prices we charge for similar offerings, sales volume, market conditions, competitive landscape and pricing practices. We recognize the relative fair value of the media placements or ad services as they are delivered assuming all other revenue recognition criteria are...

  • Page 66
    ... ABOUT MARKET RISK We are exposed to market risks in the ordinary course of our business, including interest rate and inflation risks. Interest Rate Fluctuation Risk Our exposure to interest rates relates to the increase or decrease in the amount of interest we must pay on our outstanding debt...

  • Page 67
    ...DATA PANDORA MEDIA, INC. INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Page No. 70 Consolidated Balance Sheets as of January 31, 2013 and December 31, 2013 Consolidated Statements of Operations for the twelve months ended January 31, 2012 and 2013 and the eleven months ended December 31, 2012 and 2013...

  • Page 68
    ... the eleven months ended December 31, 2013, in conformity with U.S. generally accepted accounting principles. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Pandora Media Inc.'s internal control over financial reporting as of...

  • Page 69
    .... In our opinion, Pandora Media, Inc. maintained, in all material respects, effective internal control over financial reporting as of December 31, 2013, based on the COSO criteria. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States...

  • Page 70
    ... liabilities Accrued royalties Deferred revenue Accrued compensation Total current liabilities Other long-term liabilities Total liabilities Stockholders' equity: Common stock, $0.0001 par value, 1,000,000,000 shares authorized: 172,506,051 shares issued and outstanding at January 31, 2013 and 195...

  • Page 71
    ... per share amounts) Twelve months ended January 31, 2012 Revenue Advertising Subscription and other Total revenue Cost of revenue Cost of revenue - Content acquisition costs Cost of revenue - Other Total cost of revenue Gross profit Operating expenses Product development Sales and marketing General...

  • Page 72
    Pandora Media, Inc. Consolidated Statements of Comprehensive Loss (In thousands) Twelve months ended January 31, 2012 Net loss Change in foreign currency translation adjustment Change in net unrealized losses on marketable securities Other comprehensive loss Total comprehensive loss $ $ (16,107) (5)...

  • Page 73
    Pandora Media, Inc. Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit) (In thousands, except share amounts) Re de e mable Conve rtible Pre fe rre d Stock Share s Amount Balances as of January 31, 2011 Issuance of common stock upon exercise of stock ...

  • Page 74
    ... stock issuance cost Supplemental disclosures of cash flow information Cash paid during the period for income taxes Cash paid during the period for interest Purchases of property and equipment recorded in accounts payable and accrued liabilities Eleven months ended December 31, 2012 2013 (unaudited...

  • Page 75
    ...range of other internet-connected devices. We have pioneered a new form of radio-one that uses intrinsic qualities of music to initially create stations and then adapts playlists in real-time based on the individual feedback of each listener. We offer local and national advertisers an opportunity to...

  • Page 76
    ... the sale of a premium version of Pandora internet radio, or Pandora One. Subscription revenue derived from direct sales to listeners is recognized on a straight-line basis over the duration of the subscription period. Subscription revenue derived from sales through some mobile operating systems may...

  • Page 77
    ... equivalents with domestic financial institutions of high credit quality. We perform periodic evaluations of the relative credit standing of such institutions. We perform ongoing credit evaluations of customers to assess the probability of accounts receivable collection based on a number of factors...

  • Page 78
    ... as available-for-sale securities and are carried at fair value with the unrealized gains and losses reported as a component of stockholders' equity. Management determines the appropriate classification of our investments at the time of purchase and reevaluates the available-for-sale designations...

  • Page 79
    ... to our website and the Pandora app, development of new advertising products and development and enhancement of our personalized station(s) generating system. We have generally expensed product development as incurred. Certain website development and internal use software development costs may be...

  • Page 80
    ... employee-related costs, consisting of salaries and benefits for finance, accounting, legal, internal information technology and other administrative personnel. In addition, general and administrative expenses include professional services costs for outside legal and accounting services, facilities...

  • Page 81
    ... gains, gross unrealized losses and fair value by significant investment category as of January 31, 2013 and December 31, 2013. As of January 31, 2013 Adjusted Cost Money market funds Commercial paper Corporate debt securities Total cash equivalents and marketable securities $ $ 32,522 24,093 9,657...

  • Page 82
    ... risk of principal loss. In addition, the investment policy limits the amount of credit exposure to any one issuer. The unrealized losses on our available-for-sale securities as of December 31, 2013 were primarily a result of unfavorable changes in interest rates subsequent to the initial purchase...

  • Page 83
    .... Level 3-Inputs lack observable market data to corroborate management's estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model...

  • Page 84
    ... inputs only when observable market data is not available. As of January 31, 2013 Fair Value Measurement Using Quoted Prices in Active Markets for Identical Instruments (Level 1) Assets: Money market funds Commercial paper Corporate debt securities Total assets measured at fair value $ 32,522 - - 32...

  • Page 85
    ...was returned to us in September 2013. Pending Acquisition In June 2013, we entered into a local marketing agreement to program KXMZ-FM, a Rapid City, South Dakota-area terrestrial radio station. In addition, we entered into an agreement to purchase the assets of KXMZ-FM for a total purchase price of...

  • Page 86
    ... lawsuit was filed against Pandora in the United States District Court for the Northern District of California alleging that we unlawfully accessed and transmitted personally identifiable information of the plaintiffs in connection with their use of our Android mobile application. In addition to...

  • Page 87
    ...filed in February 2014. We currently believe that Pandora has substantial and meritorious defenses to the claims in the lawsuits discussed above and intends to vigorously defend our position. We are also subject to legal proceedings involving musical work royalty rates. On November 5, 2012, we filed...

  • Page 88
    ...of an increase in foreign taxes. The following table presents a reconciliation of the statutory federal rate and our effective tax rate: Twelve months ended January 31, 2012 2013 Eleven months ended December 31, 2013 U.S. federal taxes at statutory rate State taxes, net of federal benefit Permanent...

  • Page 89
    ... benefits will significantly increase or decrease within the next twelve months. Accrued interest and penalties related to unrecognized tax benefits are recorded as income tax expenses. We did not have such interest, penalties or tax benefits during the twelve months ended January 31, 2012 or 2013...

  • Page 90
    ... increased from $5.0 million to $15.0 million and the annual charge for outstanding letters of credit was reduced by 0.75% to 2.00% - 2.25% per annum based on outstanding borrowings. The amount of borrowings available under the credit facility at any time is based on our monthly accounts receivable...

  • Page 91
    ... companies in our industry that have similar vesting and contractual terms. The risk free interest rate is based on the implied yield currently available on U.S. Treasury issues with terms approximately equal to the expected life of the option. We currently have no history or expectation of paying...

  • Page 92
    ... the contractual term of 10 years. As of January 31, 2013 and December 31, 2013, a total of 52,000 and 30,270 common stock options, issued to non-employees were vested and outstanding. During the twelve months ended January 31, 2012 and 2013 and the eleven months ended December 31, 2013, we recorded...

  • Page 93
    ... The following assumptions were used to value the award using the Monte Carlo simulation: 10-year term, risk-free interest rate of 2.33%, expected volatility of 70% and a beginning stock price of $10.63. The grant-date fair value for the award was $6.08 per share. In March 2013, we announced that we...

  • Page 94
    ... expenses related to all employee and non-employee stock-based awards was as follows: Twelve months ended January 31, 2012 Stock-based compensation expenses: Cost of revenue - Other Product development Sales and marketing General and administrative Total stock-based compensation, recorded in costs...

  • Page 95
    ... stock are also entitled to receive dividends as and when declared by our board of directors, whenever funds are legally available. These rights are subordinate to the dividend rights of holders of all classes of stock outstanding at the time. Basic net loss per share is computed by dividing the...

  • Page 96
    Twelve months ended Eleven months ended January 31, December 31, 2012 2013 2013 (in thousands, except per share data) Numerator: Net loss Accretion of redeemable convertible preferred stock Increase in cumulative dividends payable upon conversion or liquidation of redeemable convertible preferred ...

  • Page 97
    12. Selected Quarterly Financial Data (unaudited) April 30, 2012 Total revenue Cost of revenue: Cost of Revenue-Content acquisition costs Cost of revenue-Other Total cost of revenue Gross profit Operating expenses: Product development Sales and marketing General and administrative Total operating ...

  • Page 98
    ... with the policies or procedures may deteriorate. Our management has assessed the effectiveness of the internal control over financial reporting as of December 31, 2013. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the...

  • Page 99
    PART III Item 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE Information required by this Item regarding our directors and executive officers is incorporated by reference to the sections of our proxy statement to be filed with the SEC in connection with our 2014 annual meeting of ...

  • Page 100
    ... part of this Transition Report on Form 10-K. 1. Index to Financial Statements Report of Independent Registered Public Accounting Firm Consolidated Balance Sheets as of January 31, 2013 and December 31, 2013 Consolidated Statements of Operations for the twelve months ended January 31, 2012 and 2013...

  • Page 101
    ...Securities Act of 1934, as amended, this report has been signed by the following persons in the capacities and on the dates indicated. Signature /s/ BRIAN MCANDREWS Brian McAndrews Title Chief Executive Officer, President and Chairman of the Board (Principal Executive Officer) Date February 14, 2014...

  • Page 102
    /s/ ELIZABETH A. NELSON Elizabeth A. Nelson Director February 14, 2014 /s/ DAVID SZE David Sze Director February 14, 2014 /s/ TIM WESTERGREN Tim Westergren Director February 14, 2014 94

  • Page 103
    ...by and among Pandora M edia, Inc. and the investors listed on Exhibit A thereto, dated M ay 20, 2010, as amended Form S-1/A S-1/A Filed By Filed Herewith 4.01 S-1/A 333-172215 4.2 2/22/2011 2011 Long Term Incentive Plan and Form of Stock Option Agreement under 2011 Long Term Incentive 10.01...

  • Page 104
    ...Unit Agreement 10.22 †under the 2011 Equity Incentive Plan Offer Letter with M ichael Herring, dated 10.23 †December 21, 2012 New Zealand Form of Restricted Stock Unit Agreement under the 2011 Equity Incentive Plan Offer Letter with Brian M cAndrews, dated September 11, 2013 10-Q 10-Q 10-K 10...

  • Page 105
    ... Plan, 2004 Stock Plan and 2011 Equity Incentive Plan of Pandora Media, Inc. of our reports dated February 14, 2014, with respect to the consolidated financial statements of Pandora Media, Inc. and the effectiveness of internal control over financial reporting of Pandora Media, Inc. included in this...

  • Page 106
    ... the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant' s ability to record, process, summarize and report financial information; and Any fraud, whether or not material, that involves management or other employees who have...

  • Page 107
    ... the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant' s ability to record, process, summarize and report financial information; and Any fraud, whether or not material, that involves management or other employees who have...

  • Page 108
    ... and the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Pandora Media, Inc. February 14, 2014 /s/ Brian McAndrews Name: Brian McAndrews Title: Chief Executive Officer, President and Chairman of the Board (Principal...

  • Page 109