Fluent(US:FLNT)2025-11-13 22:30Financial Data and Key Metrics Changes - Total consolidated revenue for Q3 2025 was $47 million, down from $64.5 million in the prior year [14] - Commerce Media Solutions revenue grew 81% year-over-year to $18.8 million, compared to $10.4 million in Q3 2024 [14] - Media margin in Q3 was $12.8 million, representing 27.2% of revenue, compared to $18.2 million or 28.1% of revenue last year [15] - The company reported a net loss of $7.6 million in Q3 2025, compared to a net loss of $7.9 million in the prior year [17] - Adjusted EBITDA for Q3 2025 was a loss of $3.4 million, compared to a loss of $71,000 in Q3 2024 [17] Business Line Data and Key Metrics Changes - Commerce Media Solutions accounted for 40% of total revenue in Q3 2025, up from 16% in Q3 2024 and 4% in Q3 2023 [9][14] - Owned and operated marketplaces saw a decline of nearly 50% year-over-year [6] - Commerce Media Solutions' media margin was $4.6 million, or 25% of its revenue, compared to $3.5 million or 34% of revenue in Q3 2024 [16] Market Data and Key Metrics Changes - The company experienced advertiser pricing and budget pullbacks in late Q3, which continued into early Q4 [5][29] - The annual revenue run rate for Commerce Media Solutions surpassed $85 million as of September 30, 2025 [5][7] Company Strategy and Development Direction - The company is focused on establishing a leadership position in the commerce media industry, with expectations of double-digit revenue growth in 2026 [8][21] - The strategic pivot towards Commerce Media Solutions is expected to enhance profitability and revenue growth [8][20] - New partnerships with Databricks and Authentic Brands Group are seen as key drivers for growth [11][12] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a challenging environment due to delays in onboarding new partners and advertiser budget pullbacks [4][5] - The company expects to achieve positive adjusted EBITDA in Q4 2025 and full-year adjusted EBITDA profitability in 2026 [18][21] - The convergence of owned and operated capabilities with Commerce Media is anticipated to create differentiated opportunities [9][13] Other Important Information - The company completed a $10.3 million equity raise, strengthening its balance sheet and providing capital for growth [7][18] - Total net long-term debt was reduced to $26 million as of September 30, 2025, down from $35.6 million at the end of 2024 [19] Q&A Session Summary Question: About the Rebuy partnership - The Rebuy partnership has shown strong early results, with over 1 million ad unit sessions in September, indicating rapid expansion [22][23] Question: Ad pullbacks in the Commerce Media segment - The pullbacks were primarily due to conservative budgeting by partners and specific industry issues affecting traditional advertisers [29][30] Question: Dynamics leading to stabilization in owned and operated business - Stabilization is attributed to the convergence strategy and the ability to bring in proprietary advertisers [48][49] Question: Expectations for Commerce Media Solutions margins - Margins are expected to improve as new solutions scale and initial incentives roll off [36][44] Question: Dick's Sporting Goods partnership - Dick's Sporting Goods became a client in September 2025 after previously selecting a competitor, indicating a significant win for the company [38][40]