Chicken Soup for the Soul Entertainment Inc (CSSE) Q4 2021 Earnings Call Transcript

Chicken Soup for the Soul Entertainment Inc (CSSE 179.25%)
Q4 2021 Earnings Call
Mar 31, 2022, 4:30 p.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Good day and thank you for standing by. Welcome to the Chicken Soup for the Soul Entertainment fourth quarter 2021 earnings call. [Operator instructions] Please be advised that today's conference is being recorded. [Operator instructions] I would now like to hand the conference over to your speaker today, Taylor Krafchik, IR.

Please go ahead.

Taylor Krafchik -- Investor Relations

Thank you, operator, and welcome. With me on the call today are Bill Rouhana, chairman and chief executive officer, and Chris Mitchell, chief financial officer, to review the fourth quarter and full year 2021 results, as well as provide a business update. Following this discussion, there will be a moderated Q&A session open to the participants on the call. During this call, management will make forward-looking statements.

Forward-looking statements include, but are not limited to, statements regarding expectations, intentions and strategies regarding the future. Forward-looking statements are based on management's current expectations and assumptions and are subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from projected results. Given these uncertainties, listeners are cautioned not to place undue reliance on any forward-looking statements contained in this conference call. Please refer to the cautionary text regarding forward-looking statements contained in the earnings release, which also applies to the content of this call.

Additional risk disclosures can be found in the company's filings with the Securities and Exchange Commission. On today's call, management will make comments on certain GAAP-based and non-GAAP pro forma financial information. The non-GAAP financial measure the company uses is adjusted EBITDA. Management believes that adjusted EBITDA provides useful information in that it excludes amounts that are not indicative of the company's core operating results and ongoing operations and provides a more consistent basis for comparison between periods.

The earnings release contains a reconciliation of adjusted EBITDA to net income or loss, which is the most directly comparable GAAP measure. For further information on the company's historical financial performance, financial condition and operational and other information and risks, we refer you to our filings with the SEC, including our annual report on Form 10-K for the year ended December 31, 2021, which we've filed today. I would now like to turn the call over to William Rouhana, Chairman and CEO. Bill, please go ahead.

Bill Rouhana -- Chairman and Chief Executive Officer

Thanks, Taylor. Welcome, everyone, and thank you for joining us today. We had a strong finish to the year and had a great 2021 with a number of major accomplishments that strengthened our foundation and established momentum for us to scale our business in 2022. I'm going to go through a quick recap of these 2021 accomplishments, give some high-level thoughts on current industry dynamics, talk about how we are scaling our business to capitalize on the opportunities we have.

And then, I'll turn it over to Chris, who will go into more detail on the financials. We had a record end to an outstanding year. Fourth quarter net revenue was a record $36 million, an increase of 78% over the prior year period. And adjusted EBITDA for the quarter was a record $9.3 million, a threefold increase over the same quarter last year.

Our full year performance set revenue and adjusted EBITDA records as well. Full year 2021 net revenue totaled $110.4 million, above our expectations and a 62% increase over 2020. Adjusted EBITDA reached $21.8 million, growing 85% over the prior year. What's even more impressive is that these growth rates are on top of the strong 2020 performance that we experienced during the COVID pandemic lockdowns.

Now, 2021 was also a transformational year strategically. First, we significantly grew our library and content pipeline. We completed the Sonar assets acquisition early in the year, which added more than 1,000 titles across an extensive library and more than 4,000 hours of high-quality programming. And not to skip ahead, we also recently doubled our library again with the 1091 acquisition.

We formed the Chicken Soup for the Soul television group in 2021, which consolidated TV studio activities under one group headed by David Ellender. We were also active and successful in acquiring content through Screen Media and producing content through our Landmark and Chicken Soup for the Soul Studios. We increased our viewership and viewer retention on our networks. Our distribution touch point strategy has been very successful.

On average, we continue to add between 400,000 and 450,000 viewers with new touch points. The Crackle Plus network is now available on more than 70 touch points, and our average total monthly active users for the Crackle Plus now exceeds 40 million. We also launched our new Chicken Soup for the Soul streaming service on several fast channels and on VIZIO as an app earlier this month. We are now rolling out the Chicken Soup for the Soul service more broadly, opening another avenue for driving revenues from our quality content and growing our viewership base.

Beyond content and distribution, we began the rollout of our new improved tech platform. It has been well received by both our viewers and our advertising partners. The new tech is now launched on VIZIO and Samsung, and the results are coming in as we'd hoped. I will add some more color on this in a minute.

And lastly, we enhanced our financial position by strengthening our balance sheet and augmenting our shareholder return profile with an active share buyback program, which we recently increased to $30 million. All in all, we have everything we need to meaningfully scale our business in 2022. Though if you followed us for any amount of time, you know we may not stop there. To set the stage for a conversation around our plans and expectation for 2022, I want to provide some high-level thoughts on the VOD industry.

There are many dynamics at play in the industry right now, and they inform our long-term strategy. As many of you know, streaming has been a mixed bag for investors in recent months. That's putting it mildly. Nearly all of the attention has been focused on the SVOD space and the decisions being made by big media names.

But we believe that the trends driving those decisions are more about the changing media landscape and viewer habits than their performance in the market. If you don't believe beneath the surface, you'll see several key trends in both SVOD and AVOD that support that. In the SVOD space, U.S. subscriptions overall are not materially growing despite the ever-increasing number of options available to viewers.

We believe the most attractive remaining growth opportunity for SVOD is overseas. Additionally, the competitive landscape is driving content investment to ever higher levels. The stakes are high here in the U.S. Signs are emerging that overcrowded -- the overcrowded landscape is beginning to result in increasingly savvy viewers jumping in and out of subscriptions to binge watch the latest big hit.

And recently reported research says more of those savvy viewers are in the millennial and Gen Z demos, who over the coming years will control the vast majority of purchasing power. All of this should ultimately lead to consolidation, a thesis well supported by the historical evolution of the media industry. SVOD has succeeded in driving cord cutting, but the slow migration away from linear pay TV doesn't mean the end of free-to-air content. AVOD is stepping into the void, and there's tremendous value there.

Ad space has become more scarce, and therefore, more valuable as cord cutting shifts viewer eyeballs away from traditional platforms. Partly as a result, we believe that AVOD is likely only in the second or third inning in the U.S. with regard to viewer growth, and furthermore, is still the only -- is only in the pregame internationally with the first inning soon to come. Overall, the keys to AVOD success are content that you can't find elsewhere, a great viewer experience, the ability to deliver targeted viewers to advertisers and the ease of access to your networks for consumers.

This is what Crackle has built, especially in the last 12 months. In summary, there is room in the world for scaled players in both AVOD and SVOD, but we think very few are paying attention to the AVOD opportunity. So let's take a look at how we're scaling our business. Our core pillars of growth are content, viewership, CPMs and technology for the user experience.

And we focus on all of these through both organic growth and opportunistic M&A. Content has clearly become our most important differentiator. All told, we now have a remarkable over 100,000 programming hours in our content library, which together with our production activity, put us on track to more than double our originally projected number of original and exclusive pieces of content per week in 2022. Our programming strategy has always been to put more original and exclusive content on our platform and to grow our IP rights ownership.

We do this by acquiring and producing content cost effectively, including through partnerships and co-productions. This is how we'll drive profitable growth, and that picture is already starting to emerge in our 2021 results, which much more -- with much more to come. We believe our company has been an AVOD leader and a growing force in streaming at large by ramping our original and exclusive releases. We now believe we will have more than 100 pieces of new original and exclusive content this year or two titles per week across our three core streaming services.

Viewership of our owned and original and exclusive content, a metric unique to us that we've been reporting to you for some time, is a good way to monitor our progress. As a percentage of overall ad impressions, original and exclusive viewership generated as high as 28% of total ad impressions in December, 24% for the quarter, both of which exceeded our goal -- our year-end goal of 20%. And that number will undoubtedly increase with our more robust 2022 pipeline. Remember, this is our most profitable content.

Beyond our originals, bigger media players are finding our streaming services to be a home for their great content. These include the BBC, who has given us a three-year exclusive AVOD license to the smash-hit series, Sherlock, and more recently signed a multiyear deal for premium content with Screen Media, whereby we'll add more than 2,500 hours of BBC originals on our services. We also recently had the Spider-Man film trilogy from Sony in time to coincide with the franchise's latest new theatrical release. Our showings of the trilogy hit the top of Crackle's movie charts, not surprisingly, and was a key driver of viewership in February.

We're also executing creatively on our media partnerships, highlighted by our recent deal with Apex Media for our Inside the Black Box series. This is a big positive as it partners us with a large advertising agency with hundreds of important advertising customers over multiple years who will help us with increasing sponsor integrations. Other brands working on upcoming series include P&G's Bounty on Comfort Kitchen and Verizon on Smart Home Nation, but there are many more. We expect to introduce brand integration opportunities at the upcoming NewFronts.

Our Chicken Soup for the Soul streaming service launched with thousands of hours of exclusive programming and is still fully rolling out across distribution touch points. Just last week, we announced its official launch on VIZIO. And last, but certainly not least, our recently announced 1091 deal fits our M&A strategy perfectly both strategically and financially. From a content perspective, it gives us distribution rights to approximately 4,000 more quality movies and TV series, doubling the size of our content catalog.

Some of the content includes Academy Award-nominated Cartel Land; Spirit Award Winner, Christine, staring Rebecca Hall; and Grammy award winner, Linda Ronstadt, The Sound of My Voice. This deal also comes with established fast and AVOD streaming channels that generate approximately 1 billion yearly ad impressions. The 1091 deal is also immediately accretive to our financial results, adding an estimated $10 million of revenue and approximately $3 million of incremental EBITDA in the next 12 months. Our expanded content lineup, combined with our aggressive distribution rollout, positions us to continue viewership growth.

We now plan to reach more than 90 consumer touch points in 2022. This is the second time we've increased that goal this year. We're also accelerating progress with our international business expansion, which is still in early stages, but we anticipate will be a key driver of viewership over the long term. One interesting side note is that our large library is allowing us to participate in the rapidly growing FAST business by segmenting groups of content that appeal to different viewers, allowing for greater refinement of our content for viewers.

We already had our Crackle Chicken Soup for the Soul and Truly FAST channels rolling out, and the 1091 acquisition adds Echoboom, the world's best collection of action sports films; Unidentified, the largest collection of family friendly and faith-based movies and documentaries; Surf Now TV, I think you can guess what that's about; and Black Picks to our lineup. Technology enhancements that we debuted in 2021 also continue to roll out across our platforms. The area where we anticipate these enhancements will be most impactful to our business is through their ability to increase our users' time spent on the platform, and therefore, ad impressions. Additionally, we continue to introduce new advertising innovations that are driving ad dollars and increasing CPMs.

With the VIZIO and Samsung new tech launches, we've seen great progress with our user engagement. VIZIO tech is beginning to have the impact we hoped. In February, watch time on VIZIO averaged over 88 minutes per engaged viewer, a 40% increase. VIZIO uniques were up 25% month over month.

VIZIO MAUs were up 28% month-over-month. VIZIO start time increased 42%. And here's one that went down, and we're happy about it. There was a 196% decrease in ad exits on the VIZIO platform, and that makes our advertisers happy.

Samsung's much more recently launched app has started off strong with engaged viewer watch time up around 70% since the launch. We're also on track to add new tech to Roku, Fire TV, LG and other major platforms in this quarter, Q2. We expect the continued rollout of our updated apps will mirror these increased watch times. While we are highly focused on executing on these strategic growth pillars, we remain optimistic and opportunistic about the consolidating media marketplace.

As we look ahead to 2022 from a financial projection perspective, we are expecting 35% top line growth and approximately 50% adjusted EBITDA growth for the full year without any further acquisitions. Revenue for our first quarter, which ends today, will come in at approximately 25% over last year. Implied in our 2022 outlook is an expectation that our top line and adjusted EBITDA growth will accelerate through the second half of the year as it has in the prior five years. Adjusted EBITDA outperformance relative to revenue growth is expected as a result of the increased investments in our new tech, as well as marketing and M&A and will -- that will primarily be reflected in the first quarter performance.

In closing, we couldn't be more excited about the future of our business as it's beginning to scale meaningfully, and we're looking forward to executing on a great year operationally, strategically and financially. I want to thank our entire Chicken Soup for the Soul entertainment team for all their hard work. I'm going to turn it over to Chris, who will go through the financials in more detail. Chris?

Chris Mitchell -- Chief Financial Officer

Thank you, Bill. Our financial results for the fourth quarter and full year 2021 reflect the tremendous accomplishments we made over the past year, which position us to scale the business meaningfully in 2022 and beyond. Starting with results for the fourth quarter. We reported record net revenue of $36 million compared to $29.1 million in the third quarter of 2021 and $20.2 million in the fourth quarter of the prior year.

This translates to a year-over-year increase of approximately 78%. The year-over-year increase in net revenue was driven by an increase in TVOD sales, an increase in viewership and ad sales related to our new distribution touch points, contribution from the Sonar library and an increase in both international licensing sales and production revenue. For the fifth consecutive quarter, we virtually sold out all of our advertising inventory. Advertisers continue to be increasingly attracted to our strong and growing viewership as we add distribution touch points and increase the pace at which we release high-quality content.

This in turn has driven our ability to not only grow existing sponsorship relationships with large commitments but also engage with new and, in some cases, larger advertising partners. Gross profit for the fourth quarter 2021 was $11.4 million or 32% of net revenue compared to $5.8 million or 29% of net revenue in the same period prior year. Gross margin in the fourth quarter was impacted by higher-than-expected technology costs as a percentage of sales as we launch new streaming apps and our investment in content ingestion from the Sonar library and the Screen Media library. Excluding $10.2 million of noncash amortization of the film library, gross profit would have been $21.6 million.

The comparable gross profit for the fourth quarter 2020 excluding noncash amortization of the film library was $12.3 million. Operating loss for the fourth quarter 2021 was $19.1 million compared to an operating loss of $9.9 million in the year ago period. Excluding the $11.8 million of impairment charges included in the fourth quarter of 2021, operating loss would have been roughly $7.2 million. Our adjusted EBITDA for the fourth quarter was $9.3 million compared to $2.8 million in the same period last year, representing a year-over-year increase of nearly three times.

This reflects the increasing scale of our business, our growing percentage of content carrying on our network for which we control IP rights and our cost-efficient production and distribution model, which we expect will drive further margin expansion over time. Summarizing our full year 2021 results. We generated record net revenue of $110.4 million compared to $66.4 million in the full year 2020, an increase of 66%. The record results for the year were driven by both organic growth and library contributions from the Sonar acquisition.

We experienced growth in all areas of the business, from strong international licensing sales and success from our TVOD releases to an increase in viewership and ad revenues, particularly from new distribution touch points and an increase in production service revenue. Gross profit for the full year 2021 was $31.3 million or 28% of net revenue compared to $14.2 million for the prior year or 21% of net revenue. Gross margin in the year was impacted by higher-than-expected technology costs as a percentage of sales as we launched new streaming apps and our investment in content ingestion from the Sonar library and the Screen Media library. Excluding $34 million of noncash amortization of the film library, gross profit would have been $65.3 million.

The comparable gross profit for 2020 excluding noncash amortization of the film library was $37.5 million. Operating loss for 2021 was $46 million compared to an operating loss of $44.3 million in the prior year. Excluding the $11.8 million of impairment charges included in the fiscal year for 2021, operating loss would have been roughly $34.2 million. Adjusted EBITDA for the full year 2021 increased 86% to $21.8 million compared to $11.8 million in 2020.

I'd like to emphasize that despite heavier-than-normal technology spend in 2021, as previously discussed, gross margins increased to 32% in the fourth quarter, up from 29% in the prior year period and 21% in the third quarter of 2021. And gross margin increased to 28% in the 2021 full year, up from 21% in the prior year. Similarly, despite investing significantly in our SG&A to support future growth, on a year over year -- on a year over prior year basis, SG&A as a percentage of net revenue improved from 41% to 37% in the fourth quarter and from 48% to 44% in the full year. Further, despite 52 new hires in 2021 on a year over prior year basis comparison, compensation expense as a percentage of net revenue improved from 28% to 20% in the fourth quarter and from 28% to 22% in the full year.

As we move into the first half of 2022, we expect gross margins and operating margins will be somewhat compressed as we continue to spend heavier than normal on technology and staffing before improving in the back half of the year as the investments that we've been making result in significant growth. Looking at our balance sheet and liquidity position as of December 31, 2021. The company had cash and cash equivalents of $44.3 million compared to $66.9 million at the end of the third quarter 2021 and $14.7 million at the end of the year ago period. The decline relative to the third quarter relates in part to share repurchases made during the fourth quarter, which I will elaborate on in a moment.

As many of you may recall, we completed a common stock offering in July that provide us with $75 million in gross proceeds. As we continue our balanced capital allocation strategy, we remain well positioned from a liquidity perspective to further build the business, including the flexibility to capture any attractive opportunities we may see in terms of highly strategic M&A, as we recently did with the acquisition of 1091 Pictures. Additionally, our board of directors approved a $10 million increase to our stock repurchase authorization in February. This is in addition to the approximately $20 million the company has repurchased since November 2021.

During the fourth quarter of 2021, we repurchased roughly 879,000 shares for a total of $12.6 million. And in the first quarter through yesterday's close, we repurchased approximately 765,000 shares for a total of $8.5 million. These repurchases reflect our confidence in the work we have done to build a strong business foundation, and we intend to continue to buy back shares opportunistically. Lastly, I wanted to quickly touch on our current share count to proactively clear up any confusion there may be and help get everyone aligned in calculating our EPS numbers.

As of December 31, 2021, the basic share count was 15.02 million shares. Net loss for the year ended December 31, 2021, was $59.4 million or $3.96 per share compared with a net loss of $44.6 million or $3.62 per share in the prior year. Excluding preferred dividends, the net loss in 2021 was $50.4 million or $3.36 per share compared with a net loss of $40.4 million or $3.29 per share in the prior year. On an adjusted basis, excluding $0.80 of charges related to impairment of content assets, intangible assets and goodwill, as well as $0.37 of amortization related to acquired intangible assets, 2021 net loss per share totaled $2.80.

In closing, we're excited about the accomplishments we made in what was an incredible successfully -- incredibly successful 2021, where we made excellent progress on our key strategic initiatives that position us to further scale the business throughout 2022. Our belief is that with these pieces in place, we are well positioned to drive sustainable top line growth and improved cash flow and profitability while capitalizing on the additional growth opportunities that we still see ahead of us, all of which we firmly believe will drive long-term shareholder value. With that, we can open up the call for questions. Operator?

Questions & Answers:

Operator

[Operator instructions] Our first question comes from Dan Kurnos from The Benchmark Company. Your line is open.

Dan Kurnos -- The Benchmark Company -- Analyst

Great. Thanks. Good afternoon, evening, Bill. Good finish to the year.

Obviously, the guide for the full year is a little bit ahead of consensus, too. So that's good to see. I just want to talk a little bit about the cadence. We've heard from some of the larger players that some of the international incidents have been causing some domestic spillover in the ad market.

While generally, CTV checks have been -- and OTT checks have been good, there's been a little bit of category, I don't know what to call it, weirdness. I don't know if that's impacting your numbers at all, if you're seeing that. I mean, the sort of trajectory and cadence for the year is kind of similar, but I just wonder if there's anything to kind of call out in Q1 or the front half just given the economic backdrop and everything that's going on out there.

Bill Rouhana -- Chairman and Chief Executive Officer

I mean, so far, we haven't seen an impact on what we -- by the way, thanks for the comments, Dan. We did have a great year, and I hope everybody realizes that now that we've finally gotten the numbers out. And we're going to have a good '22. I expect it to be a great year.

We're not seeing any real impact on the business from international events yet. I can't say that we won't. But so far, no. And I think we've already indicated that the first quarter is closing up pretty meaningfully.

And for those of you who don't remember the history, last year's first quarter was incredibly strong because we had to defer some revenue from 4Q to 1Q. So we're having a 25% increase off of what was a very strong first quarter last year. We're off to a great start for the year, and the numbers we see this year look pretty strong. So I'm pretty optimistic.

But we haven't had that kind of impact, Dan, that I've heard of or seen in other places. It may be just because it's such a long queue to get on to our networks that we're not noticing any kind of impact. I don't see any really big changes in the way -- in the dispersal of customers who are signing up. We've had a big, really pretty substantial, jump in sponsor integration activity, which was something I think I told everybody I expected to start to see because of the scarcity of ads.

So all in all, not yet, but maybe. I can't tell you how it will turn out. Obviously, what's going on internationally is horrible.

Dan Kurnos -- The Benchmark Company -- Analyst

Yes. No, it certainly is, and appreciate that color. That's helpful. Can you talk a little bit about the latter point that you just brought up, though? I mean, I know that you guys are starting to move more into the national-type arena with advertisers sort of late last year and some trajectory there.

And obviously, integrated sponsorships, especially, I mean, we -- Bill, obviously have a long history with you and kind of the legacy of the company, but sort of brand integration, especially as you kind of launch Chicken Soup, there's clearly some opportunity there, maybe even overseas as you kind of rolled that out. So maybe just on those two fronts, I'd love to get some color.

Bill Rouhana -- Chairman and Chief Executive Officer

Sure. So they're kind of related thoughts when you get right down to it. The brand -- the sponsor integration strategy, which we've had from the beginning, which we used to offset our cost of production, it's always been challenged in the sense that it was viewed as a business that's hard to scale. But we're seeing that it is starting to scale.

And I'll go back to what I said. I do think the fact that it's harder to buy AVOD ads that people would like is causing advertisers to be more flexible in the way they think about reaching consumers. And what we've seen, I mentioned a couple of them in the script, Verizon in Smart Home Nation, P&G., first time we've done a P&G integration in Comfort Kitchen, and quite a few others. Obviously, at some point, we'll say that we're going to go -- we're going to do Going from Broke Season 3, and that will have a bunch of integrations in it as well.

This process is really going pretty well. A lot of it is being enhanced by the fact that we're going to run -- this is the second half of your question, Dan, that we're going to run a number of these programs on the Chicken Soup for the Soul streaming service. And so, advertisers like that idea. They love the idea of that demographic.

They love the idea of being associated with that brand. That network is off to a really good start, but it's very early days. But the streaming services have done well. They're growing rapidly.

And now we've got our first real AVOD Chicken Soup for the Soul network out there -- streaming service out there on VIZIO with quite a few more coming very quickly. So I think those are related thoughts in a funny way because we find it easier than ever to convince advertisers that they should be thinking about integrations, especially when something is going to run in the Chicken Soup for the Soul streaming service. Now, we've got the upfronts coming soon -- or the NewFronts, I guess, they're called in our space. And I would expect to have quite a few additional things to talk about with regard to advertisers for the NewFronts.

So long answer, but a good question.

Dan Kurnos -- The Benchmark Company -- Analyst

Great. No, I appreciate the color. That's the closest I'll come to asking an international question to you today, Bill, so you're off the hook. Thanks for all the color.

I appreciate it.

Bill Rouhana -- Chairman and Chief Executive Officer

You're welcome, Dan.

Operator

Our next question comes from Thomas Forte from D.A. Davidson. Your line is open.

Thomas Forte -- D.A. Davidson -- Analyst

Great. So Bill, congrats on the quarter and year. One question and one follow-up. I'll start with the question.

You sort of talked about this, but I wanted to ask the question in this way. So a number of subscription video-on-demand services are launching complementary advertising video-on-demand services. To what extent is this a positive for Chicken Soup for the Soul because it's increasing advertisers' interest in the category? And then to what extent is it a negative because you now have increased competition on the AVOD front?

Bill Rouhana -- Chairman and Chief Executive Officer

Yes. That's a good question. So I think, Tom, on balance, it's a pretty big positive because it's -- to the extent there were still advertisers that were teetering on whether or not they thought they should be or had to be advertising in AVOD, they're tumbling over pretty quickly. I was on the phone last week with a very large consumer products company talking about opportunities to work together.

And they were -- you could see how they've warmed up to the idea of AVOD. And part of the reason is because all the big guys are embracing it, with the obvious exception of Netflix, as part of their strategy. But let's not lose sight of the fact that even with those companies embracing it as part of the strategy, they're not -- there aren't going to be enough ads. There just aren't going to be.

They're not going to materially affect the overall availability of advertising. The demand is going to so far exceed the availability. And it's going to be interesting to see what happens with the SVODs as a result of the fact that they're starting to add the advertising where they do. I mean, I already -- you've already seen, I think, probably the 9%-or-so reduction in SVOD hours that have occurred in the last period last -- I think it was the last quarter over prior years.

People are churning off of those SVODs, I think, and learning how to manage them better. I said that in my script. But it really feels to me like our prediction that there would be a limit to how many SVOD services people had is coming to fruition, but the AVOD services -- so long as we can keep amping up and making our content better and better, I think it's almost inevitable that we'll take more and more share of time.

Thomas Forte -- D.A. Davidson -- Analyst

Excellent. And then, my second question is, again, you sort of talked about this, but I wanted to ask it specifically. Given that you continued to sell out your inventory, how should we think about the opportunity for you to increase your CPM rates?

Bill Rouhana -- Chairman and Chief Executive Officer

Well, they are increasing. They continue to increase. We had, I believe, the fourth quarter was -- we hit the all-time record for our services. And I think it was in November, which would make sense because that's the quarter of the -- that's the month of the greatest demand in the year by and large.

So I think there will continue to be CPM increases. My view of this is it's one -- that's one of the metrics we're trying to drive, as you know, Tom. One is how many viewers? I don't know if anybody noticed, we finally admitted we broke 40 million monthly active viewers. And we broke that by a pretty good number, but I didn't want to go to the top number because I still think that number is going to bounce around a bit.

And then, of course, there's the time on site. And we gave you some pretty important numbers about the results on both the VIZIO and the Samsung rollout of the new tech. And then, there's the new services, Chicken Soup for the Soul, and then there's the new fast services. And all of those factors, as you know, Tom, go into the growth overall of the AVOD business.

CPMs is one of -- is one other. And so, it's -- there's favorable -- every one of those is in a favorable trend right now. So they add to each other and they generate -- that's a big cause for our optimism. I mean, there's a lot of good trends there that we just articulated.

And by the way, the distribution touch point strategy is a home run. It just completely worked. And it's continuing to work.

Thomas Forte -- D.A. Davidson -- Analyst

Thanks for taking my questions, Bill.

Bill Rouhana -- Chairman and Chief Executive Officer

You're welcome.

Operator

Our next question comes from Jason Kreyer from Craig-Hallum. Your line is open.

Jason Kreyer -- Craig-Hallum Capital Group -- Analyst

Hey, guys. Good afternoon. Bill, so you referenced that you've doubled content over the past year. I think you also said that the content will double again with the 1091 acquisition.

Obviously, revenue isn't going to grow hand-in-hand with the content investments that you've made. But I'm trying to just get an understanding of what other areas of investment you're going to approach in 2022 that will help catalyze that revenue growth.

Bill Rouhana -- Chairman and Chief Executive Officer

Well, I think as Chris said -- by the way, hi, Jason. As Chris said in his part of the talk, we've been continuing to invest in further rollout of new tech, further rollout of new streaming services. And I would say that if you listened to the portion of my talk where we were discussing the FAST businesses, we're embracing those as well and seeing some pretty significant impact from that. And it all comes from the fact that we've got this very robust owned and/or controlled content.

And we can use it both for ourselves and also to monetize it with others in ways that are not competitive to our AVODs. And the combination of those two things, of course, is what's driving the growth overall. But as far as -- when you use the word investment, I would say that we are kind of at the point now where it will be rare for us to step out and take on additional content unless it's something extraordinary like the BBC deal, where we picked up the exclusive rights for three years to one of the most important series of all times, one of the most popular series of all times, with one of the -- with a star who is about as hot as you could possibly be on the planet. So it's -- and then 2,500 other hours of really top-notch content.

By the way, much of which is exclusive to us. Some people have asked us if the -- if any of the other content is exclusive, and the answer is yes. So it's going to be more -- we're going to be able to be more choosy, more picky about the way we spend, Jason, in terms of the content side of the house because we now have plenty. And I think I tried to say this a couple of years ago to people, and it's still the case.

Over time, all of the AVOD players will end up imitating our strategy. Just take a look at Tubi. They'd be the first to tell you they're doing -- they're watching what we're doing and doing it. They just announced they did MarVista.

They announced they're going to have, I don't know, I think they said 80 pieces of original and exclusive content this year or next year or something like that. We'll be over 100. But the implications of that are that if you're not currently in a relationship with an AVOD, it's going to be harder and harder to get your stuff on in AVOD in a meaningful place. And that's going to change the dynamics in the business for us favorably in terms of our ability to pick and choose really top-notch content at a lower cost.

So I hope I answered your question. I think I did but tell me if I didn't.

Jason Kreyer -- Craig-Hallum Capital Group -- Analyst

You did. No, you did. That was helpful. One follow-up from me.

So you had alluded earlier to the upfronts or NewFronts. Wondering if you can just preview any expectations there, whether that's industry expectations and how that will positively influence Chicken Soup or perhaps you can maybe upfront kind of some -- or tease out some initiatives that you may be looking to roll out.

Bill Rouhana -- Chairman and Chief Executive Officer

Yes. I'll get yelled at, Jason, if I give you everything that I'm thinking about right now, because part of the NewFronts is you have to -- you want to be introducing new things. So suffice it to say that a good chunk of the focus will be on the new Chicken Soup for the Soul streaming service and all of the incredible content opportunities that we have there. I mean, the last time we talked about content, I want to remind everybody, we predicted we'd have one new piece of original and exclusive content each week.

That's 52. We're going to break 100 this year. So we have really managed to get that into high gear to get the combination of production and acquisition working. And I doubt we need much more than that.

But I can't -- I don't want to give too much away, Jason, about what's going to happen at the NewFronts because then it would make them less exciting, and those are very important to us, so.

Jason Kreyer -- Craig-Hallum Capital Group -- Analyst

We will look to learn more about those in the next month or so.

Bill Rouhana -- Chairman and Chief Executive Officer

Thanks.

Jason Kreyer -- Craig-Hallum Capital Group -- Analyst

Thank you. sir

Bill Rouhana -- Chairman and Chief Executive Officer

You're welcome.

Operator

Our next question comes from Michael Morris from Guggenheim. Your line is open.

Michael Morris -- Guggenheim Securities -- Analyst

Thank you. Good afternoon, everyone. Thanks for all the detail in your prepared remarks. Bill, you did spend a lot of time referencing tech and the importance of the investment there.

I'm hoping maybe you can remind us in a bit more detail what the tech investments have been and how it is impacting the consumer experience and maybe a little bit of where we are in the investment cycle on those items compared to the monetization potential of what you're doing there. And then, secondly, maybe for Chris. Could you expand a little bit on the booked impairments in the quarter? What was the driver of the charges that you took? What were the assets on the content on the goodwill side that you made the changes to? Thanks, guys. Appreciate it.

Bill Rouhana -- Chairman and Chief Executive Officer

Mike, you may have given me an opportunity, once Chris comments on that last part of your question, to give you my latest philosophical disagreement with GAAP. But before we get to that, let me try and answer your first question. In the tech space, it's really been two big initiatives over the last year. One is really an inside kind of initiative, which is the ingestion process, getting that up to speed.

You don't build a library of the sort we have without actually needing big pipes to move the digital content around even within our own world. And that's been a very significant portion of our spend over the last year. And that's about done. We're almost done with that.

I'd say 90% plus through that. The other big spend has been on improving the tech platform for the viewer experience. And you see that it's successful in the numbers I cited from the VIZIO and Samsung, at least early days. And that has been -- I guess, let's see, we've had at least three releases on VIZIO, maybe four, as we work through each little iteration.

Because every time you do a software release, there's a bug or two or 10 or 100, and you need to work your way through those, make sure they get cleaned up and that you then take the next version. And we've been -- I think we're in version -- I think we're in the third version or the fourth version of that, but we now feel very good about that. And so, the spend shifts from, I'll call it, perfecting, although you never perfect software, perfecting your underlying network to rolling it out across the other platforms. The Samsung rollout is the first piece after the VIZIO one.

But as I said in my talk, we will roll out to Roku and Fire, and I forget the other ones that I listed, LG and a couple of others this quarter, this quarter being Q2. I meant tomorrow, I'm sorry. I'm no longer in March. I'm now in April.

But the -- so that is also very far along, Mike. One of the reasons we talked about Q1 the way we did was we wanted everybody to understand that there will be a little bit of a residual drag on the EBITDA. It's not going to be bad. It's still going to be quite positive, but that it will be a little bit less robust than it would have been if we weren't investing.

But as we roll through the year -- as you can see from this year, as we get rolling through the year, we start to really generate a very different kind of EBITDA with scale. So I'm very, very bullish on the year for that. And part of it is because much of the tech spend -- while it never goes away, much of the tech spend that is not about scaling is behind us. So a lot of the free-scale investment that just drags you down but doesn't add revenue, is over.

There's lots more to spend to roll out, but the rollout should add revenue and should be much more closely tied to it. And that's part of the reason why we're optimistic about the last half of the year the way we've said. So I think that answered your question. But if it didn't, tell me, and then I'll turn you over to Chris.

Michael Morris -- Guggenheim Securities -- Analyst

No. That was very helpful. I appreciate that.

Bill Rouhana -- Chairman and Chief Executive Officer

OK. Chris, your turn.

Chris Mitchell -- Chief Financial Officer

All right. On the content impairment side, I think you can break down the impairments into three basic buckets. The first of which is the development bucket, and that's a relatively small amount of the total. Any development work that you've done that's been on your books for more than three years, if it hasn't turned into something that's green lit, you got to write it off.

So there's a little bit of that. And then, the rest of it is broken down into the two other buckets. And I would say it's -- one bucket is the Screen Media library. You have to look at the titles.

And if you feel like a title was impaired based on its 10-year ultimate, you have to write it down. Conversely, if you see a title that you feel was underestimated initially in terms of revenue potential, you're not allowed to write it up. So that kind of speaks to Bill's philosophical issue with the process, but that is the process that GAAP requires. And so, I would say, again, after a small amount of development project that was written off, the rest of it is broken down fairly evenly between the two buckets of the Screen Media titles.

It's a lot of titles, as you might imagine, that goes back many years, as well as the CSS originals. The CSS originals are the productions that the company started with, built up a good number of series like the Hidden Heroes as an example. And we just had some impairments based on those original ultimates. I would say that we've learned a lot over the course of a good number of years now doing those types of productions.

And we build that into our current 10-year ultimates with production work, but with what I would view as a fairly conservative process you have to go through. And we did it, and this was the result.

Bill Rouhana -- Chairman and Chief Executive Officer

So Mike, why do I dislike this? I mean, besides the fact that it's stupid, which is obvious, that you can only write down things and not write things up. Without being too specific, in the last few weeks alone, we've received proposals on individual pieces of content. I'm not going to exaggerate. I may give you the actual number, where the offers are 1,800% higher than the content cost is on our balance sheet.

We don't get to write that up. This is nonsense. It's absolute nonsense. But you know what, that's what I -- you guys know, I'm not a big fan of GAAP to begin with.

I've made that point over and over again. It doesn't matter. It's not a really -- it's really not a big deal. But still, our overall library is way more valuable than it's ever been.

It's -- we've got a tremendous number of really important titles in there now, lots of award-winning shows, fantastic stars. I mean, to me, it's silly. But we -- what am I? Who am I? We got to get new GAAP police is what we need.

Michael Morris -- Guggenheim Securities -- Analyst

Sorry, Bill. Just --

Bill Rouhana -- Chairman and Chief Executive Officer

Go ahead, Mike. Go ahead.

Michael Morris -- Guggenheim Securities -- Analyst

Can I jus ask, just since you brought that up, that offer, is that an offer for -- to license it to another service? Is it so in trying to maybe acquire an individual title?

Bill Rouhana -- Chairman and Chief Executive Officer

I mean, people -- that was an actual acquisition offer. People come to us all the time and go, can we buy your -- can we buy this or buy that? We have intellectual property that's very, very valuable. And -- but that would just kind of sticks to my craw because it's like at exactly the same time these folks are writing off some small number of millions of our library. We're getting offers for individual pieces of content that are more than the total amount of the write-off.

It doesn't make any sense to me. I just find it ludicrous. Our library is incredibly valuable. We have one of the largest film and television libraries now in the world, and it's high-quality programming.

And we own much of the intellectual property underlying it. And we have long-term rights on most of it. It's an unusual amalgamation of asset value. And in fact, if you look at the way some of the distribution companies are being sold today with libraries that are a fraction of our size, they're selling for more than our market cap, which is another ridiculous thing, by the way, if you want to talk about ridiculous things.

Our market cap is one of the most ridiculous things I've seen. But before I get on that one, let's let the next person and the last person ask a question because we're running out of time. So thanks, Mike.

Michael Morris -- Guggenheim Securities -- Analyst

Thanks for the answers. Appreciate it.

Operator

And we'll take our last question from Brian Kinstlinger from Alliance Global Partners. Your line is open.

Brian Kinstlinger -- Alliance Global Partners -- Analyst

Great. Thanks so much, Bill. Nice quarter. Each of your 70 touch points or so have so many content partners.

You go on an Amazon TV or any other, and there's so many apps. What additional steps is the company taking to attract or compete for new viewers and create brand awareness for Crackle Plus? And then my follow-up and then that's all for me is, can you talk about how the load rates, I'm not sure if I heard that, improves on the new tech platform on VIZIO and Samsung compared to what historically have been your load rates? And what's the planned timeline for all touch points to be migrated?

Bill Rouhana -- Chairman and Chief Executive Officer

OK. That's a lot of stuff, Brian. Let me do my best. All right.

So let's talk about promotion and marketing first. I'm going to go back to what I always say: it's the content. It's all about the content. If you take a look at February, for example, where we had the three Spider-Man -- the old Spider-Man titles on our network.

I'm not going to preannounce the results. But suffice it to say, it was an unbelievably good month because the content was there, and people wanted it. And they came, they watched that, and they watched other things. And they found it.

We didn't even really have to promote it. The distribution platforms promoted it for us, Brian, because they recognize that it's the content that drives viewership. And so, that kind of promotion that we normally would have to buy, we got quite a bit of it for free. You watch what happens with Sherlock.

Sherlock is a long-term opportunity to lock up a piece of programming that's one of the most popular pieces of programming in history. And we are the only ones who will have it for three years. The only place you're going to be able to see that series in our country is going to be on our Crackle Plus networks. That's what drives viewership.

It's the content. If I was Bill Clinton, I'd say it was the content, stupid. But it's the content. So that is what it is.

And everything else is secondary. Now, admittedly, the Chicken Soup for the Soul brand is a big brand, and we have millions and millions of fans, and we will use every bit of that fan and outreach from our books and our other businesses to drive people to that network. And that will be, I think, very special. But it's the content.

That's what matters. Now, you had asked about some statistics for various -- for the rollout of both VIZIO and Samsung, and I'll repeat most of what I said here. VIZIO had a 40% increase in time on site, 25% increase in uniques, 28% increase in monthly active viewers and start time increase of 42%. And the one I like best, which I'll repeat because I thought it was fun, was the 196% decrease in ad exits, which I think is really fabulous.

That just means the ads are being loaded seamlessly, quickly. They're not irritating people, and they come, and they go and people stay. That's really special. Watch Peacock sometime and see if you can make it through a whole show without wanting to throw something at the television when they start to try to load one of their ads and you get that stupid little yellow thing that goes around, and around, and around.

I mean, this is one of the parts of our business that people do not like, and I don't blame them. And then, Samsung is already up 70% in engaged viewer watch time. But it's very, very early, Brian. It's only a few days, really, that it's up, that it exists.

But those are really good starts with the new tech. And we are, as I said, rolling out the rest of it very, very rapidly. And I gave you the list of what's coming this quarter. By the end of this year, we don't want to have any touch points that don't have our new tech on them.

With that, let me thank everybody for joining us today. I know we went a little long, but we had a lot to tell you. And there's been a lot going on in this company, as you know. It was really a fabulous year.

And other than the stock price, things are pretty good. So I look forward to speaking to you all in the future as well. Thank you, operator. Thank you all.

Thank you, listeners.

Operator

[Operator signoff]

Duration: 60 minutes

Call participants:

Taylor Krafchik -- Investor Relations

Bill Rouhana -- Chairman and Chief Executive Officer

Chris Mitchell -- Chief Financial Officer

Dan Kurnos -- The Benchmark Company -- Analyst

Thomas Forte -- D.A. Davidson -- Analyst

Jason Kreyer -- Craig-Hallum Capital Group -- Analyst

Michael Morris -- Guggenheim Securities -- Analyst

Brian Kinstlinger -- Alliance Global Partners -- Analyst

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