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Fluent, Inc. (FLNT)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 revenue was $44.7M, down 24% YoY; Commerce Media Solutions (CMS) grew 121% to $16.1M and reached 36% of total revenue, but Owned & Operated (O&O) declined 49%, driving consolidated weakness .
  • Against Wall Street consensus, revenue missed by ~$8.0M while EPS beat: Revenue consensus was $52.7M*, actual $44.7M; EPS consensus was -$0.285*, actual -$0.24. The miss was driven by O&O media supply and pricing volatility on biddable platforms; EPS outperformed on lower operating expense and interest expense .
  • Guidance shifted: management now expects adjusted EBITDA positive in Q4 2025, and full-year double-digit revenue growth and adjusted EBITDA profitability in 2026—replacing prior 2025 full-year adjusted EBITDA positive commentary .
  • Strategic catalysts: CMS annual revenue run rate >$80M (up 23% QoQ), expanded partnership with Authentic Brands Group, Shopify ecosystem entry via Rebuy Engine, and post-quarter $10.3M financing to support scaling and liquidity .

Values retrieved from S&P Global*.

What Went Well and What Went Wrong

What Went Well

  • “We saw continued strong performance from our Commerce Media Solutions business with revenue growth of 121% year-over-year… We expect margins to normalize over time as we continue to expand our list of top-tier media partners” — CEO Don Patrick .
  • CMS run rate exceeded $80M (+23% QoQ), with 36% of consolidated revenue in Q2, showing sequential mix shift toward CMS .
  • Expanded partnerships: 15 new partners added since the beginning of Q2; portfolio-level expansion with Authentic Brands Group; Rebuy Engine partnership opens access to 12,000+ Shopify brands .

What Went Wrong

  • O&O revenue fell 49% YoY to $21.4M, driven by volatility and pricing spikes on biddable platforms and reduced media supply; regulatory headwinds continue to constrain profitable media buying .
  • CMS media margin compressed to 20.0% from 30.4% YoY due to early-term contract incentives and new placement expansion beyond post-transaction; management expects margins to return to “high twenties” over time .
  • Consolidated revenue declined 24% YoY; media margin dollars fell 24% YoY; adjusted EBITDA remained negative ($2.8M), despite sequential improvement .

Financial Results

Quarterly Summary (oldest → newest)

MetricQ4 2024Q1 2025Q2 2025
Revenue ($USD Millions)$65.4 $55.2 $44.7
Gross Profit Margin %21% 21% 23%
Media Margin % of Revenue25.3% 24.9% 26.7%
Adjusted EBITDA ($USD Millions)-$1.709 -$3.084 -$2.773
Adjusted Net Loss per Share ($USD)-$0.18 -$0.31 -$0.24
Cash & Equivalents ($USD Millions)$9.439 $4.828 $4.929

YoY Comparison — Q2 2025 vs Q2 2024

MetricQ2 2024Q2 2025
Revenue ($USD Millions)$58.7 $44.7
Owned & Operated Revenue ($USD Millions)$42.0 $21.4
Commerce Media Solutions Revenue ($USD Millions)$7.3 $16.1
Media Margin ($USD Millions)$15.7 $11.9
Media Margin % of Revenue26.7% 26.7%
Adjusted EBITDA ($USD Millions)-$4.504 -$2.773
Adjusted Net Loss per Share ($USD)-$0.47 -$0.24

Segment Breakdown

MetricQ4 2024Q1 2025Q2 2025
Owned & Operated Revenue ($USD Millions)$38.2 $31.1 $21.4
Commerce Media Solutions Revenue ($USD Millions)$17.2 $12.7 $16.1
CMS % of Consolidated Revenue26% 23% 36%

KPIs

KPIQ4 2024Q1 2025Q2 2025
CMS Annual Revenue Run Rate ($USD Millions)$60 $65 >$80
CMS Gross Profit Margin %39% 22% 18%
CMS Media Margin %39.3% 24.6% 20.0%

Estimates vs Actuals (oldest → newest)

MetricQ2 2024Q1 2025Q2 2025
Revenue Consensus Mean ($USD)$61.7M*$57.3M*$52.7M*
Revenue Actual ($USD)$58.7M $55.2M $44.7M
EPS Consensus Mean ($USD)-$0.35*-$0.325*-$0.285*
EPS Actual ($USD)-$0.47 -$0.31 -$0.24

Values retrieved from S&P Global*.

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Adjusted EBITDA profitabilityFY 2025Positive adjusted EBITDA for full-year 2025 Adjusted EBITDA positive in Q4 2025; full-year adjusted EBITDA positive in 2026 Lowered/Timing pushed out
Consolidated revenue growthFY 2025Double-digit revenue growth in 2025 Double-digit revenue growth in 2026 Lowered/Timing pushed out
CMS margin targetOngoing—Return CMS gross margin to “high twenties,” margin normalization expected as incentives roll off New disclosure
CMS revenue mix2H 2025—CMS to become majority of consolidated revenue in 2H 2025 New disclosure
Capital/financingNear-termNeed to raise capital per prior disclosures Raised $10.3M post-quarter to fund growth and reach Q4 2025 adjusted EBITDA profitability Executed financing

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024, Q1 2025)Current Period (Q2 2025)Trend
CMS growth trajectoryCMS revenue +139% YoY in Q4; run rate $60M CMS revenue +121% YoY; run rate >$80M (+23% QoQ) Accelerating growth, mix shift to CMS
CMS margins & pricingCMS margin 39% in Q4 (post-transaction strength) Margin at 20% due to incentives/new placements; expected return to high-20s Temporary compression, improving in 2H
O&O headwindsShift away from ACA; credit facility and going concern risk O&O declines from biddable platform volatility and regulatory constraints Continued pressure
PartnershipsRebuy Engine for Shopify merchants (announced post-Q1) Expanded Authentic Brands Group partnership; 15 new partners added Broadening enterprise footprint
Financing/liquidityNegotiating credit agreement amendment; need capital $10.3M private placement to support scaling and Q4 EBITDA target Strengthened near-term liquidity
AI/data differentiationIdentity graph enhancements highlighted Emphasis on first‑party data and one‑to‑one targeting at post‑purchase moments Strategic differentiation reiterated

Management Commentary

  • “Commerce Media Solutions annual revenue run rate now exceeds $80 million… strong momentum in executing the Company's strategic pivot to this higher growth market” — CEO Don Patrick .
  • “Margins were lower than historical levels… we offered early-term contract incentives… We expect margins to normalize over time” — CEO Don Patrick .
  • “We added 15 new partners… expanded our relationship with Authentic Brands… Rebuy Engine… opened an expansive network of over 12,000+ active ecommerce brands” — CEO Don Patrick .
  • “This private placement gives us the working capital to… reach adjusted EBITDA profitability in Q4 and for the full year of 2026 and beyond” — CFO Ryan Perfit .

Q&A Highlights

  • O&O decline drivers: post-FTC settlement restrictions narrowed media diversification; spikes in biddable platform pricing forced revenue pullback to preserve margins .
  • Rebuy Engine integration: early days, <10% of CMS volume, strong onboarding momentum; expected to contribute in 2H and 2026 .
  • CMS margin dynamics: compression from competitive pricing, new solutions/placements, and channel mix; margins already improving in Q3 and expected back to “historical” high-20s by Q4 .
  • New placements beyond post-transaction: loyalty monetization (currency/points), post-receipt/post-registration modules to deepen engagement and monetization .
  • First‑party data advantage: proprietary identity graph enables millisecond-level relevancy and higher conversion, driving stronger monetization vs competitors .
  • Clarification: double-digit consolidated growth target refers to 2026 (not 2025), with Q4 2025 adjusted EBITDA positivity .

Estimates Context

  • Q2 2025 vs consensus: Revenue $52.7M* vs actual $44.7M (miss), EPS -$0.285* vs actual -$0.24 (beat). Q1 2025: Revenue $57.3M* vs actual $55.2M (miss), EPS -$0.325* vs actual -$0.31 (beat). Q2 2024: Revenue $61.7M* vs actual $58.7M (miss), EPS -$0.35* vs actual -$0.47 (miss). Values retrieved from S&P Global*.
  • Implications: Street likely lowers near-term revenue forecasts on O&O and CMS margin compression; EPS trajectory may improve on expense discipline and financing-driven flexibility .

Values retrieved from S&P Global*.

Key Takeaways for Investors

  • The narrative is firmly about mix shift: CMS is scaling rapidly (run rate >$80M), expected to become majority revenue in 2H 2025—core bullish driver despite O&O headwinds .
  • Near-term profitability inflection now targeted for Q4 2025 adjusted EBITDA, with full-year 2026 double-digit revenue growth and profitability—expect estimates to migrate accordingly .
  • Revenue miss vs consensus was largely from O&O media supply/pricing volatility and regulatory constraints; watch sequential CMS margin improvement as incentives roll off .
  • Strategic partnerships (Authentic Brands Group, Rebuy Engine) expand premium inventory and merchant reach; these should be catalysts for 2H scaling and 2026 visibility .
  • Liquidity improved via $10.3M financing; balance sheet supports the pivot, but monitor covenant compliance and credit facility updates as disclosed previously .
  • Trade setup: EPS beat with revenue miss—stock may react to improving margin trajectory commentary and CMS majority milestone in 2H; execution on margin normalization and partner onboarding is key to sentiment .
  • Medium-term thesis: Proprietary first-party data and performance DNA position Fluent to monetize post-purchase/adjacent placements; successful margin normalization and sustained partner wins underpin durable CMS economics .