Video-sharing platform Rumble (RUM) reported impressive Q4 2024 financial results with a 48.2% year-over-year revenue increase to $30.23 million. Despite this growth, the company fell short of analysts’ expectations, prompting shares to continue on a downward trajectory, with the stock down approximately 40% year-to-date. Looking ahead, the company expects over 25% revenue growth in Q1 2025 compared to the same quarter last year. Meanwhile, analysts have adjusted their price targets and maintain a cautious outlook amid mixed financial outcomes.
In the Giants’ Shadow
Rumble is positioning itself as an independent infrastructure dedicated to promoting free and open internet access. As a video-sharing platform and cloud services provider, Rumble aims to challenge YouTube’s (GOOG) dominance. It’s a tall order, given that YouTube has become the most-watched streaming video platform in the United States, exemplified by its delivery of over 1 billion hours of video daily to more than 100 million viewers and generating approximately $36 billion in annual advertising revenue—surpassing major competitors such as Netflix (NFLX), Disney+(DIS), Hulu, and Amazon Prime (AMZN).
With ambitious goals, Rumble aims to carve out its own space in the video-sharing and streaming industry. In the fourth quarter of 2024, the platform reported an average of 68 million global Monthly Active Users (MAUs), marking the twelfth consecutive quarter with more than 40 million MAUs. This includes a notable increase during the U.S. presidential election season, with 52 million users based in the U.S. and Canada—a 21% rise from the 43 million MAUs in the previous quarter. The Average Revenue Per User (ARPU) also increased by 18%, rising to $0.39 from $0.33 in the third quarter of 2024, driven by enhanced advertising and subscription revenue.
For the fourth quarter, the company reported revenue of $30.2 million, marking a significant increase from $20.4 million in the same quarter the previous year. The annual revenue for 2024 was $95.5 million, up from $81 million in 2023. Despite a net loss of $236.8 million in Q4 2024, mainly due to a change in the fair value of derivative expenses related to an investment by Tether, the company’s adjusted EBITDA showed improvement, with a loss of $13.4 million compared to a loss of $30 million in Q4 2023. Looking ahead to Q1 2025, the company anticipates a minimum 25% year-over-year increase in revenue and aims to achieve a breakeven adjusted EBITDA in 2025.
Analysts are Cautious
Analysts following the company have struck a cautious tone. Wedbush’s Scott Devitt has lowered his price target for the shares to $10 (from $13) while maintaining a Neutral stance on the stock, noting Rumble’s recent mixed financial performance, where adjusted EBITDA surpassed expectations but revenue fell short of expectations. Additionally, Rumble projects a minimum of 25% year-over-year revenue growth for Q1 2025, indicating strong early-year trends.
Rumble is rated a Moderate Buy overall, based on the recent recommendations. The average price target for RUM stock is $15.00, which represents a potential upside of 91.57% from current levels.
