Fluent Inc ((FLNT)) has held its Q4 earnings call. Read on for the main highlights of the call.
The recent earnings call for Fluent Inc. painted a picture of a company in transition, with mixed sentiments reflecting both promising developments and ongoing challenges. While significant growth was reported in the Commerce Media Solutions segment, the company also faced hurdles in its legacy business areas, resulting in declining overall revenue and negative EBITDA.
Commerce Media Solutions Growth
Fluent Inc. reported an impressive 139% growth in Commerce Media Solutions revenue in Q4 2024 compared to the same quarter in 2023, and a staggering 284% growth for the full year. This highlights the company’s strategic shift towards this high-margin business area.
Annual Revenue Run Rate
The Commerce Media Solutions business surpassed an annual revenue run rate of over $60 million by the end of 2024, up from $50 million at the end of September 2024. This indicates a strong upward trajectory in this segment.
Strategic Partnerships
Throughout 2024, Fluent Inc. announced several key partnerships with leading brands, with more partnerships anticipated in 2025. These alliances are expected to bolster the company’s growth in the Commerce Media sector.
Commerce Media’s Contribution to Revenue
Commerce Media Solutions accounted for 16% of Fluent Inc.’s consolidated revenue in 2024, up from 4% in 2023, and represented 26% in Q4 2024. This significant contribution underscores the growing importance of this segment to the company’s overall financial health.
Media Margin Growth in Commerce Media
The media margin for Commerce Media Solutions in Q4 2024 was $6.8 million, or 39.3% of revenues, compared to $1.3 million, or 18.5%, in Q4 2023. This substantial increase reflects the profitability potential of the Commerce Media segment.
Overall Revenue Decline
Despite the growth in Commerce Media, Fluent Inc. experienced a 10% decline in overall revenue in Q4 2024 compared to the previous year, highlighting challenges in other areas of the business.
Owned and Operated Revenue Decrease
The company saw a 23% decrease in owned and operated revenue in Q4 2024 compared to the prior year, and a 29% decrease for the full year compared to 2023, indicating struggles in its traditional business operations.
Adjusted EBITDA Negative
Fluent Inc. reported a negative adjusted EBITDA of $1.7 million in Q4 2024, a significant drop from a positive $2.5 million in Q4 2023. This was largely driven by a $2.5 million ACA-related write-off.
Net Loss for the Year
The company reported a net loss of $29.3 million for the full year 2024, an improvement from a net loss of $63.2 million in 2023, indicating some progress in reducing overall losses.
Revenue Write-Down
Fluent Inc. discontinued the ACA portion of its call solutions business, resulting in a $2.5 million nonrecurring write-down of revenue in Q4 2024, reflecting the company’s strategic pivot away from less profitable segments.
Forward-Looking Guidance
Looking ahead, Fluent Inc. anticipates continued triple-digit growth in its Commerce Media Solutions segment throughout 2025. Despite a 10% overall revenue decline in Q4 2024, the company expects potential for double-digit consolidated revenue growth in the latter half of 2025. The strategic pivot towards commerce media aims to enhance enterprise margins and position Fluent Inc. as a leader in the burgeoning $50 billion commerce media industry.
In summary, Fluent Inc.’s earnings call revealed a company navigating through a transitional phase, with significant growth in its Commerce Media Solutions segment counterbalanced by challenges in its legacy business areas. The strategic shift towards commerce media is expected to drive future growth, positioning the company for potential success in the evolving market landscape.