Financial Data and Key Metrics Changes - Total revenue for Q1 2025 was $55.2 million, a decrease of 16% year-over-year, with $5.2 million of that decline attributed to exited businesses in 2024 [16][17] - Commerce Media Solutions revenue increased by 99% to $12.7 million, indicating strong growth momentum [17] - Owned and operated revenue decreased by 30% year-over-year to $31.1 million, primarily due to challenges in acquiring media from social media channels [17][18] - Gross margins decreased compared to the prior year due to media cost pressures and a shift in revenue mix [18] - Adjusted EBITDA for Q1 2025 was a loss of $3.1 million, compared to a positive adjusted EBITDA of $0.7 million in Q1 2024 [19][20] - Net loss for Q1 2025 was $8.3 million, compared to a net loss of $6.3 million in the prior year [22] Business Line Data and Key Metrics Changes - Commerce Media Solutions now represents 23% of consolidated revenue, up from 10% a year ago [12] - Media margin for Q1 2025 was $13.7 million, or 24.9% of revenue, down from $22.1 million or 33.6% of revenue in the previous year [18] - Commerce Media gross margin was $3.1 million, or 24.6% of revenues, compared to $2 million or 31.3% of revenues in Q1 2024 [19] Market Data and Key Metrics Changes - The commerce media market is projected to grow to $100 billion over the next five years, accounting for more than 25% of digital media spend by 2026 [10] - The company is navigating cost pressures from international tariffs and broader retail inflation, creating uncertainty in the industry [12][13] Company Strategy and Development Direction - The company is focusing on growth opportunities in commerce media solutions, leveraging its owned and operated marketplaces as a foundation for expansion [5][6] - A strategic partnership with Rebuy Engine aims to enhance revenue opportunities and access a large Shopify ecosystem [6][10] - The company anticipates a shift in revenue mix towards commerce media solutions, which is expected to improve margins over time [9][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in returning to year-over-year consolidated revenue growth and positive adjusted EBITDA in the second half of 2025 [9][12] - The company is optimistic about the growth potential in the commerce media industry, viewing it as a significant opportunity for long-term revenue growth [14][24] - Management acknowledged the challenges posed by economic uncertainty but believes that new commerce partners will help offset potential declines in consumer spending [51] Other Important Information - The company ended Q1 2025 with $6.1 million in cash and cash equivalents and reduced total debt to $25.6 million [22][23] - The company is strategically utilizing debt as a source of capital as the business scales [23] Q&A Session Summary Question: Can you share more about the Rebuy Engine partnership and its expected financial contributions? - Management highlighted the strategic importance of the partnership, providing access to a new sales channel in Shopify and enhancing revenue opportunities [26][30] Question: What are the key contributors to accelerating CMS revenue growth back to triple digits? - Management indicated that acquiring new commerce partners and leveraging technology investments will drive growth [32] Question: Can you discuss efforts to expand supply channels for the owned and operated segment? - Management noted ongoing challenges due to regulatory impacts but is exploring new nontraditional platforms to stabilize the business [34][39] Question: What level of stabilization is needed in the O&O segment to achieve positive EBITDA? - Management confirmed that the O&O business remains profitable and expects revenue growth from commerce media to drive overall profitability [46] Question: How does economic uncertainty affect commerce media signings? - Management observed an acceleration in the pipeline during economic uncertainty, indicating a faster conversion of potential clients [55][56] Question: What does the future business model for commerce media look like? - Management expects strong operating leverage and a shift towards contribution margin positivity in 2025 [61][62]

Financial Data and Key Metrics Changes - Total revenue for Q1 2025 was $55.2 million, a decrease of 16% year-over-year, with $5.2 million of that decline attributed to exited businesses in 2024 [16] - Commerce Media Solutions revenue increased by 99% to $12.7 million, indicating strong growth momentum [17] - Owned and operated revenue decreased by 30% year-over-year to $31.1 million, primarily due to challenges in acquiring media from social media channels [17] - Gross margins decreased compared to the prior year due to media cost pressures and a shift in revenue mix [18] - Adjusted EBITDA for Q1 2025 was a loss of $3.1 million, compared to a positive adjusted EBITDA of $0.7 million in Q1 2024 [20] - Net loss for Q1 2025 was $8.3 million, compared to a net loss of $6.3 million in the prior year [21] Business Line Data and Key Metrics Changes - Commerce Media Solutions now represents 23% of consolidated revenue, up from 10% a year ago [12] - Media margin for Q1 was $13.7 million, representing 24.9% of revenue, down from 33.6% in the previous year [18] - Commerce Media gross margin was $3.1 million or 24.6% of revenues, compared to $2 million or 31.3% in Q1 2024, showing strong growth despite lower margins [19] Market Data and Key Metrics Changes - The commerce media market is projected to grow to $100 billion over the next five years, accounting for over 25% of digital media spend by 2026 [10] - The company is navigating cost pressures from international tariffs and broader retail inflation, creating uncertainty in the industry [12] Company Strategy and Development Direction - The company is pivoting towards growth opportunities in commerce media solutions, leveraging its owned and operated marketplaces [5][6] - A strategic partnership with Rebuy Engine aims to enhance revenue opportunities and expand market share within the Shopify ecosystem [6][10] - The company anticipates a stabilization of its owned and operated business while focusing on the growth of commerce media solutions [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in returning to year-over-year consolidated revenue growth and positive adjusted EBITDA in the latter half of 2025 [9] - The company is optimistic about the potential of the commerce media marketplace, viewing it as a significant growth opportunity [14] - Management acknowledged the challenges posed by economic uncertainty but believes new commerce partners will offset potential declines in consumer spending [47] Other Important Information - The company ended Q1 2025 with $6.1 million in cash and cash equivalents and reduced total debt to $25.6 million [21][22] - The partnership with Rebuy is expected to provide significant upside, with initial clients already live on the platform [67] Q&A Session Summary Question: Can you share more about the Rebuy Engine partnership and its expected financial contributions? - The partnership is seen as a major milestone, providing access to a large sales channel in Shopify, with initial integrations already live [25][26] Question: What are the key contributors to accelerating CMS revenue growth back to triple digits? - The focus is on acquiring new commerce partners and leveraging technology investments made over the past two years [30] Question: What efforts are being made to expand supply channels for the owned and operated segment? - The company is exploring new nontraditional platforms and working with demand partners to improve media buying strategies [32][35] Question: How does the economic environment affect commerce media signings? - There is an acceleration in the pipeline during economic uncertainty, with faster movement through sales phases [51][52] Question: What is the outlook for the enterprise pipeline in commerce media? - The pipeline has doubled in size, with larger opportunities compared to the previous year, reflecting strong brand building and results [72]

[Fluent, Inc. First Quarter 2025 Financial Results](index=1&type=section&id=Fluent%2C%20Inc.%20First%20Quarter%202025%20Financial%20Results) [CEO Commentary and Strategic Pivot](index=1&type=section&id=CEO%20Commentary%20and%20Strategic%20Pivot) Fluent's Q1 2025 saw strong Commerce Media Solutions growth and a new partnership, despite attrition in its Owned and Operated business - The Commerce Media Solutions business has been the primary growth driver, achieving nearly **triple-digit year-over-year growth** since its launch in early 2023[3](index=3&type=chunk) - Announced a strategic partnership with Rebuy Engine to launch "Rebuy Ads powered by Fluent," targeting Shopify merchants with post-purchase advertising[3](index=3&type=chunk)[6](index=6&type=chunk) - The Owned and Operated business experienced attrition due to a reduction in media supply, particularly from social media, with active expansion of supply channels underway to mitigate this[3](index=3&type=chunk) - Due to the shifting revenue mix, consolidated revenue for Q2 2025 is expected to be similar to Q1 2025[3](index=3&type=chunk) [First Quarter Financial Highlights](index=1&type=section&id=First%20Quarter%20Financial%20Highlights) Q1 2025 revenue decreased 16% to $55.2 million, driven by Owned and Operated declines offset by 99% growth in Commerce Media Solutions Q1 2025 Key Financial Metrics vs. Q1 2024 | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | **Total Revenue** | **$55.2M** | **$66.0M** | **-16%** | | Commerce Media Solutions Revenue | $12.7M | $6.4M | +99% | | Owned and Operated Revenue | $31.1M | $44.7M | -30% | | Gross Profit (excl. D&A) | $11.4M | $18.6M | -39% | | Net Loss | $8.3M | $6.3M | +32% | | Net Loss Per Share | $0.39 | $0.45 | N/A | | Adjusted EBITDA | ($3.1M) | $0.7M | -$3.7M | - Commerce Media Solutions revenue grew to represent **23% of consolidated revenue** in Q1 2025, up from 10% in Q1 2024[6](index=6&type=chunk) - The annual revenue run rate for Commerce Media Solutions now exceeds **$65 million**, an 8% increase quarter-over-quarter[6](index=6&type=chunk) [Business Outlook & Goals](index=1&type=section&id=Business%20Outlook%20%26%20Goals) Fluent targets full-year 2025 revenue growth and positive adjusted EBITDA, leveraging its data for competitive advantage - Goal to drive revenue growth, improve net loss compared to 2024, and achieve positive adjusted EBITDA for the full-year 2025[7](index=7&type=chunk) - Financial improvements are expected to materialize in the second half of 2025 as Commerce Media Solutions becomes a larger portion of consolidated revenue[8](index=8&type=chunk) - Strategy includes leveraging its 14-year leadership in customer acquisition and its database of first-party user data as a competitive differentiator[8](index=8&type=chunk) [Financial Statements](index=5&type=section&id=Financial%20Statements) Unaudited Q1 2025 financial statements show decreased assets, a wider net loss, and improved operating cash flow [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) The balance sheet reflects changes in assets, liabilities, and equity as of March 31, 2025 Balance Sheet Summary (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $4,828 | $9,439 | | Total current assets | $51,228 | $65,955 | | **Total assets** | **$77,494** | **$93,617** | | Total current liabilities | $51,659 | $64,682 | | **Total liabilities** | **$55,459** | **$68,662** | | **Total shareholders' equity** | **$22,035** | **$24,955** | [Consolidated Statements of Operations](index=6&type=section&id=Consolidated%20Statements%20of%20Operations) The statement of operations details revenue, expenses, and net loss for the first quarter of 2025 Statement of Operations Summary (in thousands, except per share data) | Account | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenue | $55,210 | $65,983 | | Total costs and expenses | $62,286 | $69,936 | | Loss from operations | ($7,076) | ($3,953) | | **Net loss** | **($8,269)** | **($6,276)** | | **Basic and diluted loss per share** | **($0.39)** | **($0.45)** | [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) The cash flow statement summarizes cash movements from operating, investing, and financing activities Cash Flow Summary (in thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $2,112 | ($132) | | Net cash used in investing activities | ($1,570) | ($1,796) | | Net cash used in financing activities | ($5,153) | ($2,218) | | **Net decrease in cash** | **($4,611)** | **($4,146)** | | Cash at end of period | $6,083 | $11,658 | [Non-GAAP Financial Measures](index=8&type=section&id=Non-GAAP%20Financial%20Measures) Fluent uses non-GAAP measures like Media Margin, Adjusted EBITDA, and Adjusted Net Income to evaluate performance - The company uses Media Margin, Adjusted EBITDA, and Adjusted Net Income as supplemental performance measures[19](index=19&type=chunk)[20](index=20&type=chunk)[21](index=21&type=chunk) - Media margin is a primary metric to measure the financial return on media costs, while Adjusted EBITDA is used to evaluate operating performance and for compensation decisions[31](index=31&type=chunk)[32](index=32&type=chunk) Reconciliation of Adjusted EBITDA from Net Loss (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net loss | $(8,269) | $(6,276) | | Adjustments (Taxes, Interest, D&A, etc.) | $5,185 | $6,941 | | **Adjusted EBITDA** | **$(3,084)** | **$665** | Reconciliation of Adjusted Net Loss from Net Loss (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net loss | $(8,269) | $(6,276) | | Adjustments (Share-based comp, etc.) | $1,611 | $2,047 | | **Adjusted net loss** | **$(6,658)** | **$(4,229)** | Reconciliation of Media Margin (Consolidated, in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenue | $55,210 | $65,983 | | Gross profit (excl. D&A) | $11,435 | $18,635 | | **Media margin** | **$13,731** | **$22,139** | | Media margin % of revenue | 24.9% | 33.6% | Reconciliation of Media Margin (Commerce Media Solutions, in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenue | $12,660 | $6,376 | | Gross profit (excl. D&A) | $2,813 | $1,823 | | **Media margin** | **$3,111** | **$1,998** | | Media margin % of revenue | 24.6% | 31.3% | [Other Information](index=3&type=section&id=Other%20Information) This section includes conference call details, a corporate overview, and a Safe Harbor statement on forward-looking risks - A conference call to discuss Q1 2025 results was scheduled for May 15, 2025, at 4:30 PM ET[9](index=9&type=chunk) - The Safe Harbor statement lists significant risk factors, including compliance with credit agreement covenants, industry competition, reliance on the gaming industry, and potential changes in online marketing spend by clients[11](index=11&type=chunk)[12](index=12&type=chunk)

Core Insights - Fluent, Inc. reported strong year-over-year growth in its Commerce Media Solutions business, achieving nearly triple-digit growth since its launch in early 2023 [2][4] - The company experienced a decrease in overall revenue, primarily due to attrition in its Owned and Operated business, but anticipates stable revenue in the second quarter of 2025 [2][5] - A strategic partnership with Rebuy Engine was announced to enhance advertising capabilities for Shopify merchants [2][4] Financial Performance - Total revenue for Q1 2025 was $55.2 million, a decrease of 16% from $66.0 million in Q1 2024 [5] - Commerce Media Solutions revenue grew 99% to $12.7 million, representing 23% of consolidated revenue, compared to $6.4 million or 10% in Q1 2024 [4][5] - Owned and Operated revenue decreased 30% to $31.1 million from $44.7 million in Q1 2024 [5] Profitability Metrics - The net loss for Q1 2025 was $8.3 million, or $0.39 per share, compared to a net loss of $6.3 million, or $0.45 per share, in Q1 2024 [5][18] - Gross profit margin for Commerce Media Solutions was 22% in Q1 2025, compared to 21% for the consolidated business [4][5] - Adjusted EBITDA for Q1 2025 was negative $3.1 million, a decrease of $3.7 million compared to Q1 2024 [5][30] Business Outlook - The company aims to establish its Commerce Media Solutions business as a leader in performance marketing and drive revenue growth in the second half of 2025 [10] - Fluent plans to leverage its extensive first-party data to differentiate itself in the commerce media space [10] - The company expects to continue meaningful growth in its Commerce Media Solutions business through 2025 [2][10]

Group 1 - Fluent, Inc. will report its financial results for the First Quarter 2025 after the close of U.S. financial markets on May 15, 2025 [1] - A conference call to discuss the results will be held at 4:30 pm ET on the same day [1] - The conference call can be accessed by phone after registering online or via audio, and will also be webcast on Fluent's Investor Relations Page [2] Group 2 - Fluent, Inc. is a commerce media solutions provider that connects top-tier brands with highly engaged consumers [3] - The company leverages exclusive ad inventory, robust first-party data, and proprietary machine learning to unlock additional revenue streams for partners [3] - Founded in 2010, Fluent uses its expertise in performance marketing to drive monetization and increase engagement across the customer journey [3]

Core Viewpoint - FLINT Corp. reported a significant improvement in Adjusted EBITDAS, achieving $5.1 million, which is a 61% increase compared to the previous year, despite a 6.1% decline in revenues [1][4][7]. Financial Performance - Revenue for Q1 2025 was $137.9 million, down from $146.9 million in Q1 2024, reflecting a decrease of $9.0 million or 6.1% [6][7]. - Gross profit increased to $14.4 million, up 10.7% from $13.0 million in the same quarter last year, with a gross profit margin of 10.4%, compared to 8.9% in Q1 2024 [6][9]. - Adjusted EBITDAS reached $5.1 million, a 60.5% increase from $3.2 million in Q1 2024, with an Adjusted EBITDAS margin of 3.7%, up from 2.2% [6][11]. - SG&A expenses decreased to $9.4 million, down 6.9% from $10.1 million in Q1 2024, maintaining a consistent SG&A margin of 6.8% [6][10]. Liquidity and Capital Resources - As of March 31, 2025, the company's liquidity, including cash and available credit facilities, was $89.1 million, an increase from $77.0 million a year earlier [7][14]. - The company has an asset-based revolving credit facility allowing for maximum borrowings of up to $50.0 million, maturing on April 14, 2027 [13]. Operational Insights - The CEO highlighted the company's commitment to quality execution and scaling the business, noting improved operating results despite decreased revenues [3]. - New contract awards and renewals totaled approximately $78.0 million for Q1 2025, with 74% of the work expected to be completed within the year [7].

Core Insights - Fluent, Inc. and Rebuy Engine have formed a strategic partnership to launch Rebuy Ads powered by Fluent, aimed at enhancing customer engagement and generating additional revenue for merchants at no cost [1][3]. Group 1: Partnership Overview - The partnership combines Fluent's AI-driven advertiser marketplace with Rebuy Engine's integration within the Shopify ecosystem, targeting over 12,000 active merchants [2][4]. - Rebuy Ads is designed to be revenue-positive for merchants, providing a unique opportunity that compensates them for adoption rather than charging fees [3][5]. Group 2: Market Impact - Rebuy Engine generates over $1 billion in new revenue annually for its merchants, indicating significant market potential for the new product [2]. - The collaboration is expected to drive rapid adoption and engagement within the Rebuy Engine merchant community and the broader Shopify platform [3][5]. Group 3: Company Profiles - Rebuy Engine specializes in personalized shopping experiences for Shopify stores, focusing on increasing conversions and customer retention through intelligent upselling and cross-selling [6]. - Fluent, Inc. connects brands with engaged consumers using first-party data and machine learning to enhance monetization and customer acquisition [7].

The Business Services group has plenty of great stocks, but investors should always be looking for companies that are outperforming their peers. Fluent (FLNT) is a stock that can certainly grab the attention of many investors, but do its recent returns compare favorably to the sector as a whole? A quick glance at the company's year-to-date performance in comparison to the rest of the Business Services sector should help us answer this question.Fluent is one of 271 companies in the Business Services group. T ...

Core Insights - Fluent, Inc. has released an enhanced Fluent Identity Graph aimed at improving personalization and optimizing results for advertisers, partners, and consumers across its commerce media solutions [1] - The identity graph is a significant differentiator for Fluent in a competitive market, leveraging 14 years of customer acquisition experience and a vast first-party database of customer insights [2] Partnership and Data Integration - Fluent has partnered with Experian to enhance its identity graph by integrating Experian's online and offline identity data with Fluent's 200M+ first-party profiles, providing a more comprehensive view of U.S. consumers [3] - This partnership aims to improve targeting accuracy, ad relevance, and revenue per transaction through a privacy-safe approach [3] Technology and Performance Strategy - The integration of Experian's identity data allows Fluent to deliver smarter, personalized post-purchase offers using advanced algorithms and machine learning [4] - Fluent's AI ranks and serves relevant post-transaction offers based on consumer behavior, purchase intent, and conversion signals, enhancing personalization and driving better performance for partners [4] Market Position and Future Growth - The Fluent Identity Graph builds on over 14 years of experience in fostering consumer relationships and advertiser outcomes, positioning the company to better understand and convert high-intent audiences [5] - The release is part of Fluent's broader investment in AI-powered innovation, aimed at unlocking greater value for partners and driving long-term growth in the evolving commerce media category [5]

Part I [Item 1. Business](index=7&type=section&id=Item%201.%20Business.) Fluent, Inc. provides commerce media solutions through its marketplace and O&O properties, focusing on performance-based customer acquisition and network growth - Fluent operates as a commerce media solutions provider through its Commerce Media Solutions marketplace and Owned & Operated (O&O) digital media properties[30](index=30&type=chunk)[31](index=31&type=chunk) - The company's growth strategy focuses on expanding its Commerce Media Solutions, which launched in Q1 2023 and showed year-over-year growth in every quarter of 2024[58](index=58&type=chunk) - Gaming app advertisers accounted for approximately **35% of consolidated revenue in 2024**, down from 38% in 2023, posing industry-specific risks[93](index=93&type=chunk) - Client concentration risk decreased, with no single client exceeding **10% of revenue in 2024**, compared to 18.1% in 2023[64](index=64&type=chunk) - Regulatory actions, including an FTC settlement, have required business practice changes and adversely affected operational results[68](index=68&type=chunk) - As of December 31, 2024, the company had **210 employees**, a **24% decrease** from the prior year, reflecting strategic shifts and cost management[71](index=71&type=chunk) [Item 1A. Risk Factors](index=16&type=section&id=Item%201A.%20Risk%20Factors.) The company faces significant risks including going concern doubt, competitive and regulatory challenges, reliance on gaming, declining O&O traffic, and data privacy concerns - There is substantial doubt about the company's ability to continue as a going concern due to declining revenue, profitability issues, and non-compliance with debt covenants as of December 31, 2024[78](index=78&type=chunk)[79](index=79&type=chunk)[81](index=81&type=chunk) - The company's SLR Credit Agreement contains restrictive covenants that limit operational and financial flexibility, with non-compliance potentially leading to an event of default and accelerated debt maturities[83](index=83&type=chunk)[85](index=85&type=chunk) - Fluent is a relatively new entrant in the post-transaction commerce media business, which is dominated by a major player (Rokt), presenting significant competitive challenges[102](index=102&type=chunk) - User traffic to the company's O&O Sites has been declining for five years, primarily due to the Traffic Quality Initiative (TQI) and heightened publisher monitoring standards required by the FTC Consent Order[108](index=108&type=chunk) - Evolving and complex data privacy laws, such as GDPR and CCPA, could have a material adverse effect on the business, requiring significant resources to maintain compliance[155](index=155&type=chunk)[157](index=157&type=chunk)[158](index=158&type=chunk) - Ownership is highly concentrated, with executive officers, directors, and 10%+ holders controlling approximately **64.9% of outstanding common stock** as of March 17, 2025, which could limit other stockholders' influence[169](index=169&type=chunk) [Item 1B. Unresolved Staff Comments](index=33&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments.) The company reports no unresolved staff comments - Not applicable[176](index=176&type=chunk) [Item 1C. Cybersecurity](index=33&type=section&id=Item%201C.%20Cybersecurity.) The company outlines its cybersecurity risk management program, based on NIST standards and overseen by the CTO, General Counsel, and Board's Audit Committee, reporting no material incidents in 2024 - The company's cyber risk management program is based on recognized standards, including NIST, and is reviewed annually by internal and external auditors[178](index=178&type=chunk) - Cybersecurity governance involves the IT, Legal, and Compliance teams, with the CTO and General Counsel reporting to the CEO and providing quarterly updates to the Board's Audit Committee[179](index=179&type=chunk) - The company did not experience a material cybersecurity incident during the year ended December 31, 2024[181](index=181&type=chunk) [Item 2. Properties](index=33&type=section&id=Item%202.%20Properties.) Fluent's headquarters are in a leased New York City office space with a sublease terminating in November 2025, while its AdParlor business operates from a co-working space in Toronto, Canada - The company's headquarters are located at 300 Vesey Street, 9th Floor, New York, NY, under a sublease scheduled to terminate on November 7, 2025[182](index=182&type=chunk) [Item 3. Legal Proceedings](index=34&type=section&id=Item%203.%20Legal%20Proceedings.) The company has settled all significant recent legal matters as of December 31, 2023, including an FTC Stipulated Order for a $2.5 million civil penalty and a TCPA class action settlement for $3.1 million - The company settled with the Federal Trade Commission (FTC), agreeing to a **$2.5 million civil penalty** and implementing additional compliance measures, with the FTC Consent Order entered by the Court on August 11, 2023[186](index=186&type=chunk) - Fluent was involved in a TCPA class action (Daniel Berman v. Freedom Financial Network), which was settled, with the company's responsibility being **$3.1 million**, paid via a **$1.1 million cash payment** and a **$2.0 million junior secured promissory note**[187](index=187&type=chunk) Part II [Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=35&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities.) The company's common stock trades on The Nasdaq Capital Market under "FLNT", with no dividends paid in FY2024 and no plans for future payments due to credit agreement restrictions - The company's common stock is listed on The Nasdaq Capital Market under the symbol "FLNT"[190](index=190&type=chunk) - No dividends were paid in fiscal year 2024, and the company does not plan to pay cash dividends in the foreseeable future, a policy reinforced by the current Credit Agreement's prohibition on dividend payments[192](index=192&type=chunk) [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=36&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations.) FY2024 revenue decreased 15% to $254.6M, resulting in a $29.3M net loss and negative Adjusted EBITDA, raising substantial doubt about going concern Key Financial Results (2024 vs. 2023) | Metric | FY 2024 | FY 2023 | Change | | :--- | :--- | :--- | :--- | | **Revenue** | $254.6M | $298.4M | -15% | | **Net Loss** | ($29.3M) | ($63.2M) | +54% | | **Adjusted EBITDA** | ($5.6M) | $6.8M | -183% | | **Adjusted Net Loss** | ($18.5M) | ($7.2M) | -157% | | **Adjusted Net Loss per Share** | ($1.14) | ($0.52) | -119% | - Management concluded there is substantial doubt about the company's ability to continue as a going concern due to covenant non-compliance, the need for additional capital, and projections trending below plan[255](index=255&type=chunk)[357](index=357&type=chunk)[363](index=363&type=chunk) - The company has undertaken multiple workforce reductions throughout 2024 and into Q1 2025 to align resources with strategic initiatives and manage costs amid profitability challenges[239](index=239&type=chunk)[258](index=258&type=chunk) - Fluent entered into a new credit agreement with SLR Credit Solutions in April 2024, requiring multiple amendments and waivers since then due to non-compliance with financial covenants, each necessitating additional capital raises[262](index=262&type=chunk)[267](index=267&type=chunk)[270](index=270&type=chunk)[271](index=271&type=chunk) [Results of Operations](index=44&type=section&id=Results%20of%20Operations) FY2024 revenue fell 15% to $254.6M due to O&O declines, offset by Commerce Media growth, with net loss narrowing due to lower impairment Revenue Breakdown (2024 vs. 2023) | Revenue Stream | FY 2024 | FY 2023 | Change | | :--- | :--- | :--- | :--- | | Owned and Operated Marketplaces | $168.4M | $235.7M | -28.6% | | Commerce Media Solutions | $41.3M | $10.7M | +286.0% | | Other Streams | $44.9M | $52.0M | -13.7% | | **Total Revenue** | **$254.6M** | **$298.4M** | **-14.7%** | - Cost of revenue as a percentage of revenue increased from **73.7% in 2023 to 76.1% in 2024**, indicating pressure on margins[234](index=234&type=chunk) - The significant decrease in net loss was primarily driven by a goodwill and intangible asset impairment charge of only **$2.2 million in 2024**, compared to **$55.4 million in 2023**[241](index=241&type=chunk) - Interest expense increased by **48% to $4.7 million**, driven by a higher average interest rate on the new SLR credit facility[242](index=242&type=chunk) [Liquidity and Capital Resources](index=49&type=section&id=Liquidity%20and%20Capital%20Resources) Liquidity is strained with cash at $10.7M and $14.1M net cash used in operations, requiring capital raises and raising going concern doubt - Net cash used in operating activities was **$14.1 million in 2024**, a significant decline from the **$8.1 million in net cash provided by operating activities in 2023**[250](index=250&type=chunk) - The company's independent registered public accounting firm included an explanatory paragraph in its opinion expressing substantial doubt about the company's ability to continue as a going concern[255](index=255&type=chunk)[334](index=334&type=chunk) - To satisfy conditions of its credit agreement, the company raised capital multiple times, including **$10.0 million in May 2024**, **$2.1 million in August 2024**, **$8.5 million in December 2024**, and an additional **$5.1 million in March 2025**[273](index=273&type=chunk)[274](index=274&type=chunk)[275](index=275&type=chunk)[276](index=276&type=chunk) [Critical Accounting Estimates](index=53&type=section&id=Critical%20Accounting%20Estimates) Management identifies critical accounting estimates including revenue recognition, goodwill impairment, convertible note valuation, share-based compensation, and deferred tax asset valuation - Revenue recognition for performance-based marketing involves estimating variances for unbilled revenue based on internally tracked conversions[281](index=281&type=chunk) - Goodwill is tested for impairment at least annually, with a Q2 2024 triggering event leading to an interim test and a non-cash impairment charge of **$1.3 million** for the All Other reporting unit, writing off its remaining goodwill[287](index=287&type=chunk)[433](index=433&type=chunk) - The company elected the fair value option for its convertible notes issued in August 2024, resulting in an initial day-one unrealized loss of **$2.1 million** and subsequent fair value adjustments being recorded in the statement of operations[456](index=456&type=chunk)[458](index=458&type=chunk) [Item 7A. Quantitative and Qualitative Disclosures About Market Risk](index=59&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk.) As a "smaller reporting company," Fluent, Inc. is not required to provide the information for this item - The Company is not required to provide this information as it qualifies as a "smaller reporting company"[298](index=298&type=chunk) [Item 8. Financial Statements and Supplementary Data](index=59&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data.) This section presents audited consolidated financial statements, with the auditor's report highlighting a critical audit matter on revenue recognition and going concern doubt - The report of the independent registered public accounting firm includes an explanatory paragraph expressing substantial doubt about the Company's ability to continue as a going concern[334](index=334&type=chunk) - The auditor identified the evaluation of revenue recognition for the Fluent reporting segment as a critical audit matter due to the significant audit effort and subjective judgment required[338](index=338&type=chunk)[340](index=340&type=chunk)[342](index=342&type=chunk) Consolidated Balance Sheet Highlights (December 31) | (In thousands) | 2024 | 2023 | | :--- | :--- | :--- | | **Total Current Assets** | $65,955 | $78,406 | | **Goodwill** | $0 | $1,261 | | **Total Assets** | $93,617 | $111,867 | | **Total Current Liabilities** | $64,682 | $49,214 | | **Total Liabilities** | $68,662 | $77,463 | | **Total Shareholders' Equity** | $24,955 | $34,404 | Consolidated Statement of Operations Highlights (Year Ended December 31) | (In thousands) | 2024 | 2023 | | :--- | :--- | :--- | | **Revenue** | $254,623 | $298,399 | | **Loss from Operations** | ($23,660) | ($60,130) | | **Goodwill and Intangible Assets Impairment** | $2,241 | $55,405 | | **Net Loss** | ($29,277) | ($63,218) | | **Basic and Diluted Loss Per Share** | ($1.80) | ($4.59) | [Item 9A. Controls and Procedures](index=59&type=section&id=Item%209A.%20Controls%20and%20Procedures.) Management concluded disclosure controls and internal control over financial reporting were effective as of December 31, 2024, with no auditor attestation required - Management concluded that the company's disclosure controls and procedures were effective as of December 31, 2024[302](index=302&type=chunk) - Management concluded that internal control over financial reporting was effective as of December 31, 2024, with an attestation report from the registered public accounting firm not included as permitted for non-accelerated filers[303](index=303&type=chunk)[304](index=304&type=chunk) - No changes were made to internal control over financial reporting during the fourth quarter of 2024 that have materially affected, or are reasonably likely to materially affect, these controls[305](index=305&type=chunk) Part III [Items 10-14. Directors, Executive Compensation, Security Ownership, and Principal Accountant Fees](index=61&type=section&id=Items%2010-14) Information for Items 10-14, covering directors, executive compensation, security ownership, and principal accountant fees, is incorporated by reference from the 2025 Proxy Statement - Information regarding Directors, Executive Officers, Corporate Governance, Executive Compensation, Security Ownership, Certain Relationships, and Principal Accounting Fees is incorporated by reference from the forthcoming 2025 Proxy Statement[312](index=312&type=chunk)[313](index=313&type=chunk)[314](index=314&type=chunk)[315](index=315&type=chunk)[316](index=316&type=chunk) Part IV [Item 15. Exhibits and Financial Statement Schedules](index=62&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules.) This section lists all exhibits filed with the Form 10-K, including financial statements, schedules, corporate governance documents, and material contracts - This section provides a comprehensive list of all exhibits filed with or incorporated by reference into the Form 10-K, including multiple amendments to the company's credit agreement and various securities purchase agreements from 2024 and 2025[319](index=319&type=chunk)[320](index=320&type=chunk)