Revenue Performance - Zedge reported a 10.2% year-over-year revenue decline to $7.0 million, primarily due to uncertainty surrounding TikTok's U.S. ad spend[10]. - Total revenue for Q1 2025 was $6.979 million, a decrease from $7.771 million in Q1 2024, representing a decline of approximately 10.2% year-over-year[26]. - Advertising revenue for Q1 2025 was $4.9 million, down from $5.5 million in Q1 2024, indicating a decrease of about 10.9%[18]. - The company anticipates total revenue for FY24 to be approximately $30.1 million, reflecting a growth target of about 10.7% compared to FY23[18]. Subscriber and User Engagement - Active subscribers for Zedge Marketplace increased by 22% to 791,000, while subscription revenue grew by 13% to $1.2 million[13]. - Monthly Active Users (MAU) decreased by 14% to 24.7 million, reflecting challenges in user engagement[13]. - Active subscriptions increased to 791,000 in Q1 2025, up from 648,000 in Q1 2024, reflecting a growth of about 22.1% year-over-year[18]. Financial Metrics - Free cash flow for the quarter was $0.6 million, a decrease of 50% compared to the previous year[10]. - Cash flow from operations for Q1 2025 was $1.3 million, compared to $1.6 million in Q1 2024, a decrease of approximately 18.8%[18]. - The company reported a free cash flow of $0.8 million for Q1 2025, down from $1.2 million in Q1 2024, a decline of about 33.3%[18]. - Free Cash Flow for the first half of FY25 was $1.6 billion, with a trailing twelve months (TTM) Free Cash Flow yield of 41.7%[34]. - Zedge's trailing twelve-month free cash flow yield is above 41%, making it an attractive value stock for aggressive share repurchases[8]. Profitability and Loss - Adjusted EBITDA for the quarter was ($0.1) million, a significant decline from $1.5 million in the previous year[10]. - GAAP net loss for Q1 2025 was $1.679 million, compared to a net loss of $9.230 million in Q1 2024, showing an improvement of approximately 81.8%[26]. - Net loss for the six months ended January 31, 2025, was $2.018 billion, a decrease from $9.246 billion in the same period of 2024[28]. - Adjusted EBITDA for the first half of FY25 was $0.2 billion, compared to $4.7 billion for FY24[31]. Restructuring and Cost Management - Zedge's restructuring efforts are expected to save approximately $4 million annually, enhancing profitability and free cash flow[3]. - Stock-based compensation expenses amounted to $982 million for the six months ended January 31, 2025, down from $1.190 billion in the prior year[28]. - Impairment charges for capitalized software and technology development costs were $827 million, with no such charges in the previous year[28]. Assets and Liabilities - Total assets as of January 31, 2025, were $37.092 million, a slight decrease from $38.195 million as of July 31, 2024[25]. - Total liabilities increased to $8.887 million as of January 31, 2025, compared to $7.299 million as of July 31, 2024, representing an increase of approximately 21.8%[25]. - Deferred revenue increased significantly to $1.234 billion from $53 million year-over-year[28]. - The company reported a significant reduction in trade accounts receivable, which stood at $416 million compared to a negative $480 million in the previous year[28]. Future Plans - The company plans to introduce new AI creation features in the Zedge Marketplace and Emojipedia to drive user engagement and growth in fiscal 2026[7].
Zedge(ZDGE) - 2025 Q2 - Quarterly Results