MarketWise(MKTW) - 2025 Q2 - Quarterly Results

Financial Performance - Total net revenue for Q2 2025 was $80.0 million, with net income of $15.3 million[4] - Billings for Q2 2025 were $58.2 million, representing a 10% year-over-year increase on an adjusted basis[4] - Average revenue per user (ARPU) increased to $474, indicating strong customer value perception[5] - Total net revenue for Q2 2025 was $79,950, down 23.9% from $105,046 in Q2 2024[29] - Net income for Q2 2025 was $15,310, down 27.9% from $21,240 in Q2 2024[34] - EBITDA for Q2 2025 was $15,654, a decrease of 26.7% from $21,347 in Q2 2024[34] - Net income for the year to date June 30, 2025, is $32,151,000, a decrease of 27% compared to $43,952,000 in 2024[36] Cash Flow and Operating Activities - Cash from operating activities improved to $17.8 million, an increase of over $20 million compared to Q2 2024[4] - Cash flows from investing activities show a net cash used of $561,000, compared to $748,000 in 2024, indicating a reduction in investment outflows[36] - Net cash provided by operating activities is $19,575,000, a significant improvement from a net cash used of $22,306,000 in the previous year[36] - Cash from operating activities and free cash flow are projected to be approximately $30 million, reflecting over a $50 million improvement compared to FY 2024[19] - Free Cash Flow for Q2 2025 was $17,503, compared to $(4,291) in Q2 2024, marking a 507.9% increase[29] Balance Sheet and Assets - The company has a strong balance sheet with $69.1 million in cash and no outstanding debt[4] - Total assets as of June 30, 2025, were $211,753, down from $259,515 as of December 31, 2024[35] - Total liabilities as of June 30, 2025, were $438,771, a decrease from $477,439 as of December 31, 2024[35] - Cash, cash equivalents, and restricted cash at the end of the period is $69,112,000, down from $109,342,000 in the previous year[36] Dividends and Shareholder Returns - A quarterly and special dividend totaling $0.40 per Class A share was announced[4] Future Outlook and Guidance - The company expects billings to increase by approximately 20% compared to the annualized 2H 2024 billings, targeting around $250 million[19] - FY 2025 guidance indicates the company is on track to meet previously communicated targets[3] - The company anticipates fluctuations in Adjusted CFFO and Adjusted CFFO Margin as it invests in its growth strategy[25] Subscriber Growth and Engagement - The company is focused on increasing the number of paid subscribers and enhancing customer engagement and retention[3] Adjusted Metrics - Adjusted CFFO for Q2 2025 was $17,842, a significant increase from $(3,795) in Q2 2024, representing a change of 570.1%[29] - Adjusted CFFO margin for Q2 2025 was 30.7%, compared to (6.6%) in Q2 2024[29] Other Financial Metrics - Capital expenditures in Q2 2025 were $(339), a decrease of 31.7% from $(496) in Q2 2024[29] - Deferred revenue decreased by $33,107,000, compared to a decrease of $86,852,000 in 2024, indicating a potential improvement in revenue recognition[36] - Stock-based compensation increased slightly to $5,698,000 from $5,464,000 in the previous year[36] - The company experienced a change in fair value of contingent consideration of $(1,441,000), contrasting with a gain of $764,000 in 2024[36] - The company’s depreciation and amortization expenses decreased to $1,031,000 from $1,362,000 in the prior year[36]