Financial Data and Key Metrics Changes - The company achieved revenue of $119.1 million for Q4 2025, representing a 6% year-over-year growth [23] - Adjusted EBITDA for the quarter was $20.5 million, reflecting a significant 66% increase year-over-year [24] - Non-GAAP earnings per share for the quarter were $0.10, with a GAAP net loss of $18.8 million or $0.18 per share [26] - For the full fiscal year 2025, total revenue was $490.5 million, a decline of approximately 10% compared to the previous year [26] Business Line Data and Key Metrics Changes - The On-Device Solutions (ODS) segment revenue increased by 11% year-over-year [23] - The Advertising Growth Platform (AGP) segment revenue decreased by 3% year-over-year [23] - Revenue per device (RPD) increased by over 40% year-over-year in the U.S. and over 100% internationally [8] Market Data and Key Metrics Changes - The company reported a positive trend in June, expecting improved performance both sequentially and year-over-year [6] - The DTX business returned to growth, with revenues from non-gaming applications nearly doubling over the past year [12] Company Strategy and Development Direction - The company is focused on expanding its device footprint and improving operational efficiency through automation and AI [13][15] - Strategic investments are being made in first-party data and AI machine learning to enhance advertising capabilities [10][16] - The launch of the new version of Ignite is a key milestone, now on over 100 million devices, aimed at generating more revenue and improving service quality [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's strategy and market opportunities, highlighting a favorable regulatory environment that supports growth [39] - The outlook for fiscal year 2026 anticipates revenue between $515 million and $525 million, with adjusted EBITDA projected between $85 million and $95 million [28] Other Important Information - The company extended its credit facility, which is expected to lower the cost of capital in the future [6] - Cash balance at the end of the quarter was $40.1 million, with no new borrowings reported [27] Q&A Session Summary Question: Focus on international RPD growth opportunities - Management highlighted improved execution and increased distribution footprint as key factors driving international RPD growth, with partnerships expanding in regions like Brazil and India [35] Question: Activity from app publishers regarding Single Tap technology - Management noted a favorable regulatory environment leading to increased interest from app publishers in Single Tap licensing, with ongoing partnerships with companies like Epic and Pinterest [39] Question: Future operating expenses outlook - The CFO indicated that operating expenses are expected to remain relatively flat going forward, with potential increases aligned with business growth [40]

Core Insights - The company reported Q4 FY2025 revenue of $119.2 million, a 6% increase year-over-year, driven by double-digit growth in the On Device Solutions segment, despite a 3% decline in the App Growth Platform segment [2][31] - Adjusted EBITDA for Q4 FY2025 was $20.5 million, reflecting a 66% year-over-year growth due to improved execution and cost-saving initiatives [3][32] - The company achieved free cash flow of $5.5 million in March, an increase of over $21 million compared to the prior-year period [3][32] - Non-GAAP gross margin improved to 48%, up from 46% in the prior-year period, primarily due to product mix improvements and disciplined cost controls [3][32] Financial Performance - Cash operating expenses were $36.1 million in March, indicating progress in expense management and automation [4][33] - GAAP net loss for Q4 FY2025 was $18.8 million, or $0.18 per share [4][34] - Non-GAAP net income for Q4 FY2025 was $10.1 million, or $0.10 per share [5][34] - The cash balance at the end of the quarter was $40.1 million, an increase of $5 million from the previous quarter [5][34] - Debt balance stood at $408.7 million at the end of Q4 FY2025, with no new borrowings during the period [5][36] Segment Performance - On Device Solutions (ODS) segment revenue increased by 11% year-over-year, with over 40% RPD growth in the U.S. and over 100% internationally [6][31] - App Growth Platform (AGP) segment revenue was $30 million, representing a 3% decrease year-over-year [6][31] Strategic Initiatives - The company emphasized the importance of expense controls and operational efficiencies as key drivers of margin expansion [8] - Management reported progress in artificial intelligence, first-party data, and international device expansion as central elements for future growth [8] - The company is actively seeking a more permanent debt solution following the extension of its credit facility [5][36] Future Outlook - Projected revenue for FY2026 is between $515 million and $525 million, with non-GAAP adjusted EBITDA expected to be between $85 million and $95 million [7][37] - The management team expressed confidence in achieving sustained growth in 2026 and beyond, focusing on execution, financial discipline, and long-term value creation [11][37]

Transformation and Workforce Management - The company initiated a transformation program in October 2024 aimed at improving operating expenses, cash flows, and personnel costs, with substantial completion expected by Q1 FY 2026[46][49] - A two-phased workforce reduction was implemented, with the first phase in November 2024 and the second in January 2025[49] - The company has implemented a two-phased workforce reduction as part of its transformation program, with the first phase in November 2024 and the second in January 2025[75] Financial Performance and Risks - The company has a history of net losses and may continue to incur substantial losses if revenue does not increase sufficiently to offset operating expenses[49] - A significant portion of revenue is derived from a limited number of wireless carriers and customers, increasing the risk of revenue fluctuations[59] - The company faces challenges in maintaining and developing relationships with wireless carriers, OEMs, and advertisers, which are crucial for revenue generation[52][60] - The company's financial results are subject to significant variability due to factors such as seasonal advertising spending and economic conditions[55][65] - The company relies on advertising spend, which can be affected by changes in economic conditions and client budgets, impacting revenue[61][62] - The company anticipates that global economic uncertainties may disrupt operations and lead to decreased advertising budgets, adversely impacting financial performance[65] - The company may incur substantial costs related to acquisitions, which could adversely affect liquidity and result in increased fixed obligations[82] - The company is exposed to risks associated with new lines of business and products, which may not achieve profitability targets and could harm financial results[88] - The company’s ability to attract and retain key talent is critical, especially in high-cost regions, and failure to do so could harm business operations[76] - The company may face significant litigation costs and management distractions from legal proceedings, which could disrupt business operations[89] - The company faces challenges in adapting to rapidly changing technology and evolving customer preferences, which could impact its competitiveness[93] Regulatory and Compliance Challenges - The company is subject to numerous cybersecurity and data protection laws, which could result in legal actions and reputational harm if breaches occur[74] - The company is subject to the Digital Services Act (DSA), effective from November 2022, which imposes a comprehensive consumer protection framework and focuses on content governance and moderation[119] - The California Consumer Privacy Act (CCPA) imposes restrictions on the sale of personal information, which could materially affect the company's advertising business[116] - The company faces significant compliance costs and potential liabilities due to increasing privacy and data security regulations globally, which may limit operational capabilities in certain jurisdictions[123] - The company is subject to anti-bribery and anti-corruption laws, with non-compliance potentially leading to criminal penalties or significant fines[124] - The company has obligations under various privacy, data governance, and data security laws, which are becoming more complex and may increase operational costs[123] Market and Competitive Landscape - The company faces intense competition in the mobile advertising industry from major players like Google, Facebook, and Amazon, which could impact market share and pricing strategies[91] - The growth of the company's business is heavily reliant on the proliferation of mobile connected devices, such as smartphones and tablets[98] - A lack of customer acceptance and technological challenges could lead to a reduction in demand for the company's products and services[97] - The company must continuously invest in technology and offerings to meet evolving industry standards, which may not yield anticipated returns[95] - Security vulnerabilities in mobile devices and networks could adversely affect user confidence and revenue[105] Economic and Geopolitical Factors - International sales are expected to be a key component of revenue, but expansion efforts may be hindered by regional instability and regulatory challenges[54] - The ongoing geopolitical tensions, such as the Russia-Ukraine conflict, could disrupt the global economy and negatively impact the company's operations[110] - Changes in U.S.-China relations and regulatory landscapes could restrict the company's ability to operate in Chinese markets[111] - The introduction of stringent data privacy laws in China may complicate data transfer processes and impact the company's operations[112] Financial Obligations and Capital Management - As of March 31, 2025, the company had $411,000 drawn against its revolving line of credit and approximately $39,393 in unrestricted cash[144] - The company entered into a Fifth Amendment to its Amended and Restated Credit Agreement, extending the maturity date to August 29, 2026, and reducing the Revolver amount from $425,000 to $411,000[146] - The company is required to pay an amendment fee of $8,220 at closing and additional fees totaling $10,275 and $1,027 in subsequent quarters[146] - The company is exploring options to refinance its Amended and Restated Credit Agreement before August 29, 2025, which may include raising additional capital through new credit facilities or equity securities[149] - If the company fails to refinance its existing credit agreement, the indebtedness would be reclassified as short-term debt, potentially adversely affecting its business and stock price[151] - The company does not anticipate paying dividends in the foreseeable future due to its secured and unsecured indebtedness[159] - The company’s ability to meet debt service obligations depends on future performance and access to capital markets, which are influenced by various external factors[152] Stock and Market Volatility - The market price of the company's common stock is likely to be highly volatile, influenced by factors such as quarterly revenue variations and announcements from competitors[156] - A hypothetical increase in market interest rates of 100 basis points would result in an increase in interest expense of $10 per year for every $1,000 of outstanding debt[312] - The company is exposed to foreign currency exchange risks primarily with the euro, Turkish lira, and British pound, which may impact future revenues and expenses[313] - The company has not used any derivative financial instruments to manage its interest rate or foreign currency exchange risk exposure[312][313] Internal Controls and Governance - The company may face increased legal, accounting, and financial compliance costs due to the requirements of being a public company[165] - The Sarbanes-Oxley Act imposes challenges in maintaining effective disclosure controls and internal control over financial reporting[166] - The company has significant efforts ahead to implement appropriate processes and document its internal control system, which may divert management's attention from other business concerns[167] - Anti-takeover provisions in the company's charter could limit attempts by stockholders to replace current management and affect the market price of its common stock[169] - The company is subject to various civil and administrative sanctions if it fails to comply with the Sarbanes-Oxley Act[164] Intellectual Property and Liability Risks - The company is exposed to risks associated with intellectual property infringement, which could disrupt business operations and lead to significant financial liabilities[138] - Indemnity provisions in various agreements expose the company to substantial liability for intellectual property infringement and damages caused by malicious software[143] - The company faces risks related to open-source software, including potential vulnerabilities and the possibility of having to release proprietary code[141] Tax Attributes and NOL Carryforwards - The company has net operating loss (NOL) carryforwards for U.S. federal purposes amounting to $122.645 million, with $44.812 million subject to expiration through 2037 and the remaining $77.833 million available indefinitely but limited to 80% usage of federal taxable income per year[128] - The company may face challenges in utilizing its NOL carryforwards due to potential ownership changes affecting tax attributes[128] - The company relies on its understanding of regional regulatory requirements for marketing and advertising, with adverse changes potentially impacting revenue[129]

Financial Performance - Fourth quarter revenue totaled $119.2 million, representing year-over-year growth of 6% compared to $112.2 million in the fourth quarter of fiscal 2024[2][4] - Fourth quarter GAAP net loss was $18.8 million, or ($0.18) per share, significantly improved from a net loss of $236.5 million, or ($2.32) per share, in the same quarter last year[2][5] - Non-GAAP adjusted net income for the fourth quarter was $10.8 million, or $0.10 per share, compared to $12.6 million, or $0.12 per share, in the fourth quarter of fiscal 2024[2][6] - Non-GAAP adjusted EBITDA for the fourth quarter was $20.5 million, representing a year-over-year increase of 66% from $12.3 million in the fourth quarter of fiscal 2024[2][6] - Fiscal year 2025 revenue totaled $490.5 million, with a GAAP net loss of $92.1 million, or ($0.89) per share, compared to a net loss of $420.4 million, or ($4.16) per share, in fiscal 2024[2][7] - Non-GAAP adjusted EBITDA for fiscal year 2025 was $72.3 million, down from $92.4 million in fiscal 2024[2][8] - Consolidated net revenue for the year ended March 31, 2025, was $490,506 thousand, a decrease of 10% from $544,482 thousand in 2024[39] Revenue Breakdown - Total On Device Solutions revenue for fiscal year 2025 was $341.6 million, while App Growth Platform revenue was $153.2 million[6] - Net revenue for the three months ended March 31, 2025, was $119,152 thousand, an increase from $112,223 thousand in the same period of 2024, representing a growth of 8.6%[31] - On Device Solutions revenue increased by 11% to $86,832 thousand for the three months ended March 31, 2025, compared to $78,504 thousand in the same period of 2024[37] - App Growth Platform revenue decreased by 3% to $33,250 thousand for the three months ended March 31, 2025, down from $34,437 thousand in 2024[37] Cost and Expenses - The total costs of revenue and operating expenses for the three months ended March 31, 2025, were $130,844 thousand, significantly lower than $320,062 thousand for the same period in 2024, indicating a reduction of 59.1%[31] - The company reported a total of $39,464 thousand in product development expenses for the year ended March 31, 2025, down from $54,157 thousand in 2024[39] - General and administrative expenses increased to $173,647 thousand for the year ended March 31, 2025, compared to $169,617 thousand in 2024[39] Cash Flow and Assets - Cash and cash equivalents and restricted cash at the end of the period on March 31, 2025, were $40,084 thousand, up from $33,605 thousand at the end of March 31, 2024, reflecting an increase of 19.0%[35] - Total assets decreased to $812,854 thousand as of March 31, 2025, from $865,540 thousand as of March 31, 2024, a decline of 6.1%[33] - Long-term debt, net of debt issuance costs, increased to $408,687 thousand as of March 31, 2025, compared to $383,490 thousand as of March 31, 2024, an increase of 6.6%[33] Loss and Improvement - The net loss attributable to Digital Turbine, Inc. for the three months ended March 31, 2025, was $18,826 thousand, compared to a net loss of $236,506 thousand in the same period of 2024, showing an improvement of 92.0%[31] - The company experienced a comprehensive loss of $18,000 thousand for the three months ended March 31, 2025, compared to a comprehensive loss of $238,968 thousand for the same period in 2024, reflecting a reduction of 92.5%[31] - The company reported a basic net loss per common share of $0.18 for the three months ended March 31, 2025, compared to a basic net loss per common share of $2.32 for the same period in 2024, indicating a significant improvement[31] Future Outlook - The company expects fiscal year 2026 revenue to be between $515 million and $525 million, with non-GAAP adjusted EBITDA projected between $85 million and $90 million[12] - The CEO highlighted strong advertiser and partner demand, along with profit margin expansion, as key drivers for continued growth in fiscal 2026[3] - The company is making meaningful progress in utilizing AI and Machine Learning to optimize first-party data and explore new opportunities for Alternative Apps distribution[3] Shareholder Information - The weighted-average common shares outstanding for the three months ended March 31, 2025, were 105,427 thousand, compared to 101,974 thousand for the same period in 2024, an increase of 3.4%[31] - The company reported a foreign currency translation gain of $826 thousand for the three months ended March 31, 2025, compared to a loss of $2,462 thousand for the same period in 2024, indicating a positive shift in foreign exchange impact[31] Non-GAAP Metrics - Non-GAAP gross profit for the three months ended March 31, 2025, was $56,604 thousand, representing a gross profit margin of 48%, up from 46% in the same period of 2024[39] - Non-GAAP adjusted net income for the year ended March 31, 2025, was $36,837 thousand, down from $60,272 thousand in 2024[41] - Non-GAAP adjusted EBITDA for the three months ended March 31, 2025, increased to $20,462 thousand, compared to $12,301 thousand in the same period of 2024[43] - Non-GAAP free cash flow for the three months ended March 31, 2025, was $5,466 thousand, a significant improvement from a cash outflow of $15,637 thousand in 2024[45]

Financial Performance - The company reported a GAAP net loss of $18.8 million for the fourth quarter of fiscal 2025, a significant improvement from a loss of $236.5 million in the same quarter of fiscal 2024 [5][10] - Non-GAAP adjusted net income for the fourth quarter was $10.8 million, compared to $12.6 million in the fourth quarter of fiscal 2024 [6][10] - Total revenue for the fourth quarter of fiscal 2025 was $119.2 million, reflecting a year-over-year growth of 6% from $112.2 million in the fourth quarter of fiscal 2024 [4][10] - For the full fiscal year 2025, total revenue reached $490.5 million, down from $544.5 million in fiscal 2024 [7][10] EBITDA and Cash Flow - Non-GAAP adjusted EBITDA for the fourth quarter of fiscal 2025 was $20.5 million, representing a year-over-year growth of 66% from $12.3 million in the fourth quarter of fiscal 2024 [6][10] - Non-GAAP adjusted EBITDA for the full fiscal year 2025 totaled $72.3 million, down from $92.4 million in fiscal 2024 [9][10] - Non-GAAP free cash flow for the fourth quarter was $5.5 million, a recovery from a negative cash flow of $15.6 million in the same quarter of the previous year [10][20] Revenue Segmentation - Revenue from On Device Solutions for the fourth quarter was $86.8 million, an increase of 11% year-over-year, while App Growth Platform revenue was $33.3 million, a decrease of 3% [37] - For the full fiscal year 2025, On Device Solutions revenue was $341.6 million, down 8% from $370.1 million in fiscal 2024, and App Growth Platform revenue was $153.2 million, down 14% from $178.8 million [37] Management Commentary - The CEO highlighted improved execution and solid year-over-year growth in both revenue and EBITDA, attributing this to strong advertiser demand and profit margin expansion from a transformation program [3] - The company expressed optimism for continued growth in fiscal 2026, driven by advancements in AI and machine learning to optimize first-party data [3][11]

Core Insights - Digital Turbine, Inc. is expected to report a quarterly earnings decline to 4 cents per share, down from 12 cents per share in the same period last year [1] - The company projects quarterly revenue of $116.64 million, an increase from $112.22 million a year earlier [1] Recent Performance - On February 5, Digital Turbine reported quarterly earnings of 13 cents per share, exceeding the analyst consensus estimate of a loss of 1 cent [2] - Quarterly revenue was reported at $134.64 million, surpassing the consensus estimate of $123.68 million [2] - Following the earnings report, Digital Turbine shares fell by 4.1% to close at $4.98 [2] Analyst Ratings - B of A Securities analyst downgraded the stock from Neutral to Underperform, reducing the price target from $3.5 to $1 [6] - Macquarie analyst maintained a Neutral rating and lowered the price target from $3 to $2 [6] - Craig-Hallum analyst maintained a Buy rating but cut the price target from $5 to $4 [6]

Core Viewpoint - Digital Turbine, Inc. will host a conference call to discuss its fourth quarter and fiscal 2025 financial results and operating progress on June 16, 2025 [1] Group 1: Conference Call Details - The conference call will take place at 4:30 PM ET / 1:30 PM PT [1] - The call will be hosted by CEO Bill Stone and CFO Steve Lasher [1] - Access to the call can be made via a webcast link or by dialing specific phone numbers for the U.S. and international locations [1] Group 2: Playback Information - A playback of the conference call will be available until June 23, 2025 [2] - The replay can be accessed through designated phone numbers with a passcode [2] Group 3: Company Overview - Digital Turbine is focused on enhancing mobile experiences for consumers and delivering results for mobile operators, advertisers, and publishers [3] - The company's platform simplifies the process for partners to achieve recognition, acquisition, and monetization [3] - Digital Turbine is headquartered in North America and has offices globally [3]

Core Viewpoint - Digital Turbine (APPS) is expected to report a decline in earnings for the fourth quarter of fiscal 2025, with a consensus estimate of 5 cents per share, reflecting a 58.33% decrease from the previous year [1] Group 1: Earnings Performance - The Zacks Consensus Estimate for fiscal fourth-quarter earnings is unchanged over the past 30 days, indicating a significant decline compared to the year-ago quarter [1] - Digital Turbine has consistently beaten the Zacks Consensus Estimate in the last four quarters, with an average surprise of 281.67% [1] Group 2: Revenue Growth Factors - Strong international On-Device Solutions (ODS) momentum is expected to have contributed to revenue growth, following a 100% year-over-year revenue surge in the third quarter [2] - The company has expanded its global device partnerships, enhancing international revenue per device through collaborations with Motorola, Nokia, and T-Mobile US [3] Group 3: Market Dynamics - Despite soft device sales in the U.S., Digital Turbine has made significant progress internationally through partnerships with various companies, which is expected to support growth in the upcoming quarter [4] - The transition from waterfall to SDK bidding is anticipated to negatively impact performance, disrupting legacy Demand-Side Platforms (DSPs) and slowing down exchange monetization [5] Group 4: Challenges - Continued softness in U.S. device volumes is expected to pressure the company, offsetting growth opportunities in international markets [6]

Group 1: Momentum Investing Overview - Momentum investing contrasts with the traditional "buy low and sell high" strategy, focusing instead on "buying high and selling higher" to capitalize on fast-moving stocks [1] - Identifying the right entry point for trending stocks can be challenging, as they may lose momentum if future growth does not justify their high valuations [1] Group 2: Investment Strategy - A safer investment approach involves targeting bargain stocks that exhibit recent price momentum, utilizing tools like the Zacks Momentum Style Score to identify such opportunities [2] - The 'Fast-Paced Momentum at a Bargain' screen is effective in spotting fast-moving stocks that remain attractively priced [2] Group 3: Digital Turbine (APPS) Analysis - Digital Turbine (APPS) has shown a four-week price change of 1.4%, indicating growing investor interest [3] - Over the past 12 weeks, APPS stock has gained 18.1%, demonstrating its ability to deliver positive returns over a longer timeframe [4] - APPS has a beta of 2.41, suggesting it moves 141% higher than the market in either direction, indicating fast-paced momentum [4] Group 4: Valuation and Earnings Estimates - APPS has a Momentum Score of A, suggesting it is an opportune time to invest in the stock [5] - The stock has a Zacks Rank 2 (Buy) due to an upward trend in earnings estimate revisions, which typically attracts more investor interest [6] - APPS is trading at a Price-to-Sales ratio of 0.65, indicating it is relatively cheap, as investors pay only 65 cents for each dollar of sales [6] Group 5: Additional Opportunities - Besides APPS, there are other stocks that meet the criteria of the 'Fast-Paced Momentum at a Bargain' screen, presenting further investment opportunities [7] - The Zacks Premium Screens offer over 45 different strategies tailored to help investors find winning stock picks [8]

Core Insights - The mobile advertising technology sector is rapidly evolving due to the maturation of the digital economy and changing user privacy regulations, with Digital Turbine, Inc. (APPS) and AppLovin Corporation (APP) taking different approaches to growth and profitability [1] Digital Turbine - Digital Turbine's On-Device Solutions and App Growth Platform (AGP) are driving significant growth, with international On-Device revenues increasing by 100% year-over-year in Q3 of fiscal 2025, indicating strong advertiser demand and effective operational execution [2] - The company has expanded its global presence through partnerships with major device manufacturers like Motorola, Nokia, and Xiaomi, allowing for seamless app distribution and integration of its technologies across various regions [3] - Despite a near-term risk from softness in U.S. device volume due to extended hardware upgrade cycles, international growth and platform diversification provide substantial offsets [5] AppLovin - AppLovin benefits from integrating AI into its ad tech platform, catering to the increasing demand for data-driven solutions among mobile advertisers [6] - The divestiture of its gaming unit for $900 million allows AppLovin to focus on high-margin advertising solutions, aligning its resources with the global digital advertising market [7] - The AXON ad engine, which utilizes machine learning for enhanced targeting and performance, is central to AppLovin's growth strategy [8] - Financially, AppLovin reported a 44% year-over-year revenue increase and a 78% rise in adjusted EBITDA in Q4 of 2024, with net income growing by 248% year-over-year, showcasing strong demand and operational efficiency [9] Earnings Estimates - The Zacks Consensus Estimate for Digital Turbine's fiscal 2025 earnings has increased by 50% over the past 90 days, with a consistent earnings beat trend in the last four quarters [10] - Conversely, AppLovin's earnings estimates for 2025 have been revised downward by 2.8% in the past 30 days, although it has also consistently beaten earnings estimates in recent quarters [11] Stock Performance - Year-to-date, Digital Turbine shares have risen by 87.6%, while AppLovin's stock has declined by 10.8%, contrasting with a 5.8% drop in the S&P 500 [12] Investment Outlook - Digital Turbine is well-positioned for long-term growth due to strong advertiser demand and a growing network of partnerships, although macroeconomic challenges may temper near-term gains [15] - AppLovin's strong earnings momentum and focus on high-margin ad tech suggest positive long-term prospects, but recent downward revisions warrant caution [16]