EX-99.1 2 ex991_pressrelease5-12x2025.htm EX-99.1 Document

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RCI Reports 2Q25 Results, Hosts X Spaces Call at 4:30 PM ET Today
HOUSTON—May 12, 2025—RCI Hospitality Holdings, Inc. (Nasdaq: RICK) today reported results for the fiscal 2025 second quarter ended March 31, 2025. The Company also filed its Form 10-Q today.
Summary Financials (in millions, except EPS)
2Q252Q246M256M24
Total revenues$65.9$72.3$137.4$146.2
EPS$0.36$0.08$1.38$0.85
Non-GAAP EPS1
$0.65$0.90$1.46$1.76
Impairments and other charges (gains), net$2.1$8.2$(0.1)$8.2
Net cash provided by operating activities$8.5$10.8$21.9$24.5
Free cash flow1
$6.9$8.8$19.0$21.5
Net income attributable to RCIHH common stockholders$3.2$0.8$12.3$8.0
Adjusted EBITDA1
$14.2$17.2$29.9$34.7
Weighted average shares used in computing EPS – basic and diluted8.86 9.35 8.89 9.36 
1 See “Non-GAAP Financial Measures” below.
2Q25 Summary (Comparisons are to the year-ago period unless indicated otherwise)
Eric Langan, President and CEO, said: "As previously announced, revenues primarily reflect the sale/divestiture of five underperforming Bombshells segment locations and the effect of severe weather on company same-store sales in January and February, partially offset by improving trends in March. Profitability primarily reflects lower SSS, lower costs from the sale/divestiture of the Bombshells related units, and lower impairments. During and subsequent to 2Q25, we continued to make progress with our Back to Basics 5-Year Capital Allocation Plan, acquiring clubs, completing projects, and buying back shares."
Back to Basics 5-Year Capital Allocation Plan (FY25-29)
•2Q25: Acquired Flight Club, the premier gentlemen's club in the Detroit market ($8.0 million for the club and $3.0 million for the real estate).
•2Q25: Opened Bombshells in Denver, CO, and the rebranded/reformatted Chicas Locas in El Paso, TX.
•2Q25: Repurchased 56,875 common shares for $2.9 million ($50.92 average per share), with 8,832,125 shares outstanding at March 31, 2025.
•3Q25: Acquired Platinum West of West Columbia, SC, the only upscale adult nightclub in the central part of the state ($6.25 million for the club and $1.75 million for the real estate).
X Spaces Conference Call at 4:30 PM ET Today
•Hosted by RCI President and CEO Eric Langan, CFO Bradley Chhay, and Mark Moran of Equity Animal.
•Call link: https://x.com/i/spaces/1djGXVvkXgkxZ (X log in required).
•Presentation link: https://www.rcihospitality.com/investor-relations/.
•To ask questions: Participants must join the X Space using a mobile device.
•To listen only: Participants can access the X Space from a computer.
•There will be no other types of telephone or webcast access.

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2Q25 Results (Comparisons are to the year-ago period unless indicated otherwise)
Nightclubs segment: Revenues of $57.5 million declined by 3.1%. Sales, which were affected by weather in January and February, reflected a 3.5% decline in same-store sales and the absence of Baby Dolls Fort Worth due to fire in July 2024, partially offset by five new and/or reformatted clubs not in SSS.2
By type of revenue, alcoholic beverages declined 5.3%, service declined 2.9%, and food, merchandise and other increased 2.4%. Impairments and other charges totaled $2.0 million compared to $8.2 million.
Operating income was $14.6 million (25.4% of segment revenues) compared to $11.0 million (18.6%). Results primarily reflected the impairment decline, partially offset by the sales decline. Non-GAAP operating income was $17.1 million (29.8% of segment revenues) compared to $19.8 million (33.4%). Non-GAAP results primarily reflected the sales decline.
Bombshells segment: Revenues of $8.2 million declined 35.6%. Sales, which were similarly affected by bad weather in January and February, reflected the sale/divestiture of five underperforming locations and a 13.4% decline in SSS, partially offset by two locations not in SSS (Stafford, TX, and Denver, CO).2
Operating loss was $227,000 (-2.8% of segment revenues) compared to income of $699,000 (5.5%). Non-GAAP operating loss was $67,000 (-0.8% of segment revenues) compared to income of $750,000 (5.9%). Results primarily reflected the sales decline from open locations and Bombshells Denver pre-opening costs, most of which were offset by the sale/divestiture of non-performing locations.
Corporate segment: Expenses totaled $5.5 million (8.4% of total revenues) compared to $6.8 million (9.4%). Non-GAAP expenses totaled $5.4 million (8.2% of total revenues) compared to $6.3 million (8.8%). The decline primarily reflected lower overhead from fewer locations.
Impairments and other charges (gains), net within consolidated operations totaled $2.1 million compared to $8.2 million.
Income tax expense was $1.1 million compared to $5,000. The effective tax rate was 25.1% compared to 0.7%.
Weighted average shares outstanding of 8.86 million declined 5.2% due to share buybacks.
Debt was $241.5 million at March 31, 2025 compared to $235.5 million at December 31, 2024. The increase primarily reflected Flight Club new acquisition related debt and Bombshells Rowlett and Lubbock construction financing, partially offset by scheduled pay downs.
2 See our April 8, 2025 news release on 2Q25 sales for more details.
Non-GAAP Financial Measures
In addition to our financial information presented in accordance with GAAP, management uses certain non-GAAP financial measures, within the meaning of the SEC Regulation G, to clarify and enhance understanding of past performance and prospects for the future. Generally, a non-GAAP financial measure is a numerical measure of a company’s operating performance, financial position or cash flows that excludes or includes amounts that are included in or excluded from the most directly comparable measure calculated and presented in accordance with GAAP. We monitor non-GAAP financial measures because it describes the operating performance of the Company and helps management and investors gauge our ability to generate cash flow, excluding (or including) some items that management believes are not representative of the ongoing business operations of the Company, but are included in (or excluded from) the most directly comparable measures calculated and presented in accordance with GAAP. Relative to each of the non-GAAP financial measures, we further set forth our rationale as follows:
Non-GAAP Operating Income and Non-GAAP Operating Margin. We calculate non-GAAP operating income and non-GAAP operating margin by excluding the following items from income from operations and operating margin: (a) amortization of intangibles, (b) impairment of assets, (c) settlement of lawsuits, (d) gains or losses on sale of businesses and assets, (e) gains or losses on insurance, and (f) stock-based compensation. We believe that excluding these items assists investors in evaluating period-over-period changes in our operating income and operating margin without the impact of items that are not a result of our day-to-day business and operations.


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Non-GAAP Net Income and Non-GAAP Net Income per Diluted Share. We calculate non-GAAP net income and non-GAAP net income per diluted share by excluding or including certain items to net income or loss attributable to RCIHH common stockholders and diluted earnings per share. Adjustment items are: (a) amortization of intangibles, (b) impairment of assets, (c) settlement of lawsuits, (d) gains or losses on sale of businesses and assets, (e) gains or losses on insurance, (f) stock-based compensation, (g) gains or losses on lease termination, and (h) the income tax effect of the above-described adjustments. Included in the income tax effect of the above adjustments is the net effect of the non-GAAP provision for income taxes, calculated at 18.1% and 18.4% effective tax rate of the pre-tax non-GAAP income before taxes for the six months ended March 31, 2025, and 2024, respectively, and the GAAP income tax expense (benefit). We believe that excluding and including such items help management and investors better understand our operating activities.
Adjusted EBITDA. We calculate adjusted EBITDA by excluding the following items from net income or loss attributable to RCIHH common stockholders: (a) depreciation and amortization, (b) impairment of assets, (c) income tax expense, (d) net interest expense, (e) settlement of lawsuits, (f) gains or losses on sale of businesses and assets, (g) gains or losses on insurance, (h) stock-based compensation, and (i) gains or losses on lease termination. We believe that adjusting for such items helps management and investors better understand our operating activities. Adjusted EBITDA provides a core operational performance measurement that compares results without the need to adjust for federal, state and local taxes which have considerable variation between domestic jurisdictions. The results are, therefore, without consideration of financing alternatives of capital employed. We use adjusted EBITDA as one guideline to assess our unleveraged performance return on our investments. Adjusted EBITDA is also the target benchmark for our acquisitions of nightclubs.
We also use certain non-GAAP cash flow measures such as free cash flow. Free cash flow is derived from net cash provided by operating activities less maintenance capital expenditures. We use free cash flow as the baseline for the implementation of our capital allocation strategy.
About RCI Hospitality Holdings, Inc. (Nasdaq: RICK) (X: @RCIHHinc)
With more than 60 locations, RCI Hospitality Holdings, Inc., through its subsidiaries, is the country’s leading company in adult nightclubs and sports bars-restaurants. See all our brands at www.rcihospitality.com.
Forward-Looking Statements
This press release may contain forward-looking statements that involve a number of risks and uncertainties that could cause the Company's actual results to differ materially from those indicated, including, but not limited to, the risks and uncertainties associated with (i) operating and managing an adult entertainment or restaurant business, (ii) the business climates in cities where it operates, (iii) the success or lack thereof in launching and building the Company's businesses, (iv) cyber security, (v) conditions relevant to real estate transactions, and (vi) numerous other factors such as laws governing the operation of adult entertainment or restaurant businesses, competition and dependence on key personnel. For more detailed discussion of such factors and certain risks and uncertainties, see RCI's annual report on Form 10-K for the year ended September 30, 2024, as well as its other filings with the U.S. Securities and Exchange Commission. The Company has no obligation to update or revise the forward-looking statements to reflect the occurrence of future events or circumstances.
Media & Investor Contacts
Gary Fishman and Michael Wichman at 212-883-0655 or gfishman@pondel.com and mwichman@pondel.com.
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RCI HOSPITALITY HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share, number of shares, and percentage data)
For the Three Months EndedFor the Six Months Ended
March 31, 2025March 31, 2024March 31, 2025March 31, 2024
Amount% of RevenueAmount% of RevenueAmount% of RevenueAmount% of Revenue
Revenues
Sales of alcoholic beverages$28,866 43.8 %$32,907 45.5 %$61,054 44.4 %$66,223 45.3 %
Sales of food and merchandise9,411 14.3 %11,068 15.3 %19,517 14.2 %21,870 15.0 %
Service revenues22,912 34.8 %23,564 32.6 %47,093 34.3 %48,683 33.3 %
Other4,687 7.1 %4,744 6.6 %9,695 7.1 %9,414 6.4 %
Total revenues65,876 100.0 %72,283 100.0 %137,359 100.0 %146,190 100.0 %
Operating expenses
Cost of goods sold
Alcoholic beverages sold5,204 18.0 %5,891 17.9 %11,050 18.1 %12,172 18.4 %
Food and merchandise sold3,182 33.8 %3,993 36.1 %6,745 34.6 %8,031 36.7 %
Service and other25 0.1 %35 0.1 %97 0.2 %75 0.1 %
Total cost of goods sold (exclusive of items shown below)8,411 12.8 %9,919 13.7 %17,892 13.0 %20,278 13.9 %
Salaries and wages20,491 31.1 %20,975 29.0 %41,055 29.9 %42,307 28.9 %
Selling, general and administrative22,900 34.8 %24,653 34.1 %49,107 35.8 %49,854 34.1 %
Depreciation and amortization3,776 5.7 %3,884 5.4 %7,345 5.3 %7,737 5.3 %
Impairments and other charges (gains), net2,127 3.2 %8,195 11.3 %(117)(0.1)%8,192 5.6 %
Total operating expenses57,705 87.6 %67,626 93.6 %115,282 83.9 %128,368 87.8 %
Income from operations8,171 12.4 %4,657 6.4 %22,077 16.1 %17,822 12.2 %
Other income (expenses)
Interest expense(4,048)(6.1)%(3,999)(5.5)%(8,200)(6.0)%(8,215)(5.6)%
Interest income139 0.2 %96 0.1 %318 0.2 %190 0.1 %
Gain on lease termination— — %— — %979 0.7 %— — %
Income before income taxes4,262 6.5 %754 1.0 %15,174 11.0 %9,797 6.7 %
Income tax expense1,068 1.6 %5 — %2,915 2.1 %1,804 1.2 %
Net income3,194 4.8 %749 1.0 %12,259 8.9 %7,993 5.5 %
Net income attributable to noncontrolling interests37 0.1 %25 — %(4)— %7 — %
Net income attributable to RCIHH common shareholders$3,231 4.9 %$774 1.1 %$12,255 8.9 %$8,000 5.5 %
Earnings per share
Basic and diluted$0.36 $0.08 $1.38 $0.85 
Weighted average shares used in computing earnings per share
Basic and diluted8,861,854 9,350,292 8,891,638 9,358,768 

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RCI HOSPITALITY HOLDINGS, INC.
SEGMENT INFORMATION
(in thousands)
For the Three Months EndedFor the Six Months Ended
March 31, 2025March 31, 2024March 31, 2025March 31, 2024
Revenues
Nightclubs$57,541 $59,372 $119,265 $120,405 
Bombshells8,229 12,771 17,81625,502 
Other106 140 278 283 
$65,876 $72,283 $137,359 $146,190 
Income (loss) from operations
Nightclubs$14,603 $11,021 $35,485 $31,390 
Bombshells(227)699 1,744 785 
Other(680)(277)(851)(473)
Corporate(5,525)(6,786)(14,301)(13,880)
$8,171 $4,657 $22,077 $17,822 

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RCI HOSPITALITY HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
For the Three Months EndedFor the Six Months Ended
March 31, 2025March 31, 2024March 31, 2025March 31, 2024
CASH FLOWS FROM OPERATING ACTIVITIES
Net income$3,194 $749 $12,259 $7,993 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization3,776 3,884 7,345 7,737 
Impairment of assets1,780 8,033 1,780 8,033 
Deferred income tax benefit(853)(1,911)(1,242)(1,911)
Loss (gain) on sale of businesses and assets215 40 (1,248)37 
Amortization and writeoff of debt discount and issuance costs227 149 290 312 
Doubtful accounts expense on notes receivable— — — 22 
Gain on insurance— — (1,150)— 
Noncash lease expense668 773 1,326 1,535 
Stock-based compensation118 471 588 941 
Changes in operating assets and liabilities, net of business acquisitions:
Receivables(659)(162)1,714 1,067 
Inventories68 76 64 (142)
Prepaid expenses, other current, and other assets68 2,609 (530)(6,420)
Accounts payable, accrued, and other liabilities(55)(3,875)695 5,265 
Net cash provided by operating activities8,547 10,836 21,891 24,469 
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sale of businesses and assets956 — 1,085 — 
Proceeds from insurance— — 1,150 — 
Proceeds from notes receivable76 61 147 116 
Payments for property and equipment and intangible assets(2,854)(7,667)(8,608)(12,802)
Acquisition of businesses, net of cash acquired(6,000)— (6,000)— 
Net cash used in investing activities(7,822)(7,606)(12,226)(12,686)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from debt obligations5,433 1,956 8,396 2,657 
Payments on debt obligations(4,627)(4,278)(10,321)(10,630)
Purchase of treasury stock(2,896)(1,530)(6,114)(3,602)
Payment of dividends(619)(560)(1,242)(1,122)
Payment of loan origination costs(71)— (71)(136)
Net cash used in financing activities(2,780)(4,412)(9,352)(12,833)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS(2,055)(1,182)313 (1,050)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD34,718 21,155 32,350 21,023 
CASH AND CASH EQUIVALENTS AT END OF PERIOD$32,663 $19,973 $32,663 $19,973 
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RCI HOSPITALITY HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands)
March 31, 2025September 30, 2024March 31, 2024
ASSETS
Current assets
Cash and cash equivalents$32,663 $32,350 $19,973 
Receivables, net4,174 5,832 9,044 
Inventories4,645 4,676 4,554 
Prepaid expenses and other current assets4,071 4,427 8,387 
Assets held for sale— — 74 
Total current assets45,553 47,285 42,032 
Property and equipment, net283,442 280,075 288,224 
Operating lease right-of-use assets, net24,905 26,231 33,396 
Notes receivable, net of current portion4,031 4,174 4,289 
Goodwill62,524 61,911 67,862 
Intangibles, net167,383 163,461 172,728 
Other assets1,918 1,227 1,362 
Total assets$589,756 $584,364 $609,893 
LIABILITIES AND EQUITY
Current liabilities
Accounts payable$5,652 $5,637 $5,632 
Accrued liabilities18,161 20,280 22,597 
Current portion of debt obligations, net19,737 18,871 25,072 
Current portion of operating lease liabilities3,073 3,290 3,098 
Total current liabilities46,623 48,078 56,399 
Deferred tax liability, net21,451 22,693 27,232 
Debt, net of current portion and debt discount and issuance costs221,725 219,326 206,853 
Operating lease liabilities, net of current portion26,677 30,759 33,593 
Other long-term liabilities4,741 398 317 
Total liabilities321,217 321,254 324,394 
Commitments and contingencies
Equity
Preferred stock— — — 
Common stock88 90 93 
Additional paid-in capital55,925 61,511 77,742 
Retained earnings212,772 201,759 207,928 
Total RCIHH stockholders' equity268,785 263,360 285,763 
Noncontrolling interests(246)(250)(264)
Total equity268,539 263,110 285,499 
Total liabilities and equity$589,756 $584,364 $609,893 


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RCI HOSPITALITY HOLDINGS, INC.
NON-GAAP FINANCIAL MEASURES
(in thousands, except per share, number of shares, and percentage data)
For the Three Months EndedFor the Six Months Ended
March 31, 2025March 31, 2024March 31, 2025March 31, 2024
Reconciliation of GAAP net income to Adjusted EBITDA
Net income attributable to RCIHH common stockholders$3,231 $774 $12,255 $8,000 
Income tax expense1,068 5 2,915 1,804 
Interest expense, net3,909 3,903 7,882 8,025 
Depreciation and amortization3,776 3,884 7,345 7,737 
Impairment of assets1,780 8,033 1,780 8,033 
Settlement of lawsuits127 167 306 167 
Loss (gain) on sale of businesses and assets220 (5)(1,186)(8)
Gain on insurance— — (1,017)— 
Stock-based compensation118 471 588 941 
Gain on lease termination— — (979)— 
Adjusted EBITDA$14,229 $17,232 $29,889 $34,699 
Reconciliation of GAAP net income to non-GAAP net income
Net income attributable to RCIHH common stockholders$3,231 $774 $12,255 $8,000 
Amortization of intangibles577 640 1,157 1,299 
Impairment of assets1,780 8,033 1,780 8,033 
Settlement of lawsuits127 167 306 167 
Stock-based compensation118 471 588 941 
Loss (gain) on sale of businesses and assets220 (5)(1,186)(8)
Gain on insurance— — (1,017)— 
Gain on lease termination— — (979)— 
Net income tax effect(263)(1,701)47 (1,921)
Non-GAAP net income$5,790 $8,379 $12,951 $16,511 
Reconciliation of GAAP diluted earnings per share to non-GAAP diluted earnings per share
Diluted shares8,861,854 9,350,292 8,891,638 9,358,768 
GAAP diluted earnings per share$0.36 $0.08 $1.38 $0.85 
Amortization of intangibles0.07 0.07 0.13 0.14 
Impairment of assets0.20 0.86 0.20 0.86 
Settlement of lawsuits0.01 0.02 0.03 0.02 
Stock-based compensation0.01 0.05 0.07 0.10 
Loss (gain) on sale of businesses and assets0.02 0.00 (0.13)0.00 
Gain on insurance0.00 0.00 (0.11)0.00 
Gain on lease termination0.00 0.00 (0.11)0.00 
Net income tax effect(0.03)(0.18)0.01 (0.21)
Non-GAAP diluted earnings per share$0.65 $0.90 $1.46 $1.76 
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For the Three Months EndedFor the Six Months Ended
March 31, 2025March 31, 2024March 31, 2025March 31, 2024
Reconciliation of GAAP operating income to non-GAAP operating income
Income from operations$8,171 $4,657 $22,077 $17,822 
Amortization of intangibles577 640 1,157 1,299 
Impairment of assets1,780 8,033 1,780 8,033 
Settlement of lawsuits127 167 306 167 
Stock-based compensation118 471 588 941 
Loss (gain) on sale of businesses and assets220 (5)(1,186)(8)
Gain on insurance— — (1,017)— 
Non-GAAP operating income$10,993 $13,963 $23,705 $28,254 
Reconciliation of GAAP operating margin to non-GAAP operating margin
GAAP operating margin12.4 %6.4 %16.1 %12.2 %
Amortization of intangibles0.9 %0.9 %0.8 %0.9 %
Impairment of assets2.7 %11.1 %1.3 %5.5 %
Settlement of lawsuits0.2 %0.2 %0.2 %0.1 %
Stock-based compensation0.2 %0.7 %0.4 %0.6 %
Loss (gain) on sale of businesses and assets0.3 %0.0 %(0.9)%0.0 %
Gain on insurance0.0 %0.0 %(0.7)%0.0 %
Non-GAAP operating margin16.7 %19.3 %17.3 %19.3 %
Reconciliation of net cash provided by operating activities to free cash flow
Net cash provided by operating activities$8,547 $10,836 $21,891 $24,469 
Less: Maintenance capital expenditures1,611 2,011 2,887 2,994 
Free cash flow$6,936 $8,825 $19,004 $21,475 
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RCI HOSPITALITY HOLDINGS, INC.
NON-GAAP SEGMENT INFORMATION
($ in thousands)
For the Three Months Ended March 31, 2025For the Three Months Ended March 31, 2024
NightclubsBombshellsOtherCorporateTotalNightclubsBombshellsOtherCorporateTotal
Income (loss) from operations$14,603 $(227)$(680)$(5,525)$8,171 $11,021 $699 $(277)$(6,786)$4,657 
Amortization of intangibles572 1 — 4 577 589 47 — 4 640 
Impairment of assets1,780 — — — 1,780 8,033 — — — 8,033 
Settlement of lawsuits97 30 — — 127 167 — — — 167 
Stock-based compensation— — — 118 118 — — — 471 471 
Loss (gain) on sale of businesses and assets93 129 — (2)220 7 4 — (16)(5)
Non-GAAP operating income (loss)$17,145 $(67)$(680)$(5,405)$10,993 $19,817 $750 $(277)$(6,327)$13,963 
GAAP operating margin25.4 %(2.8)%(641.5)%(8.4)%12.4 %18.6 %5.5 %(197.9)%(9.4)%6.4 %
Non-GAAP operating margin29.8 %(0.8)%(641.5)%(8.2)%16.7 %33.4 %5.9 %(197.9)%(8.8)%19.3 %
For the Six Months Ended March 31, 2025For the Six Months Ended March 31, 2024
NightclubsBombshellsOtherCorporateTotalNightclubsBombshellsOtherCorporateTotal
Income (loss) from operations$35,485 $1,744 $(851)$(14,301)$22,077 $31,390 $785 $(473)$(13,880)$17,822 
Amortization of intangibles1,146 2 — 9 1,157 1,180 110 — 9 1,299 
Impairment of assets1,780 — — — 1,780 8,033 — — — 8,033 
Settlement of lawsuits276 30 — — 306 167 — — — 167 
Stock-based compensation— — — 588 588 — — — 941 941 
Loss (gain) on sale of businesses and assets109 (1,201)— (94)(1,186)6 4 — (18)(8)
Gain on insurance(1,017)— — — (1,017)— — — — — 
Non-GAAP operating income (loss)$37,779 $575 $(851)$(13,798)$23,705 $40,776 $899 $(473)$(12,948)$28,254 
GAAP operating margin29.8 %9.8 %(306.1)%(10.4)%16.1 %26.1 %3.1 %(167.1)%(9.5)%12.2 %
Non-GAAP operating margin31.7 %3.2 %(306.1)%(10.0)%17.3 %33.9 %3.5 %(167.1)%(8.9)%19.3 %
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