Executive Summary

Revenue declined to $4.35M in Q3 2024 from $5.73M YoY as ad demand partner algorithm changes reduced fill rates; gross margin improved sequentially to 20.9% from 10.4% in Q2 but remained below 31.8% YoY .
Adjusted EBITDA loss narrowed to $(2.25)M from $(4.55)M in Q2 and $(3.68)M YoY; SG&A fell to $4.12M as cost-cutting drove a $1.6M sequential reduction and management targets maintaining SG&A under ~$4M per quarter .
Distribution was mixed: O&O QAUs fell to 30,486 (−7% q/q; −13% y/y), while Partner Screens rose to ~51,000 (+2% q/q; +38% y/y), totaling ~81,000 active players/screens; management is pivoting to targeted geographies and launching a live channels subscription (NFL RedZone/NFL Network) to support revenue growth .
No explicit revenue/EPS guidance was issued; operating focus is on cost structure, content license renegotiations, and SG&A discipline; Wall Street consensus via S&P Global was unavailable for this quarter due to platform limits, so beats/misses vs estimates cannot be determined (Values retrieved from S&P Global)*.

What Went Well and What Went Wrong

What Went Well

SG&A expense reduced to $4.12M (−28% q/q; −35% y/y) through headcount cuts, vendor renegotiations, and marketing reductions; management aims to keep SG&A near $4M per quarter into FY2025 .
Adjusted EBITDA loss improved to $(2.25)M from $(4.55)M in Q2 and $(3.68)M YoY, lowering the revenue threshold for breakeven; “we have reduced our cash burn from operations significantly” .
Strategic content expansion: immediate ability to offer 40 live channels under subscription for venues (including NFL RedZone & NFL Network), positioned as a near-term revenue catalyst into the sports season .

What Went Wrong

Revenue fell to $4.35M (−23–24% YoY), primarily due to a major ad demand participant changing algorithms and terms, reducing ad call frequency/fill rates; management does not expect prior absolute revenue levels without a significantly larger footprint .
Gross margin compressed YoY to 20.9% from 31.8% as fixed/content license fees became larger as a percentage of lower revenue; certain licenses are on non-revenue metrics, further pressuring COGS .
O&O QAUs declined to 30,486 (−7% q/q; −13% y/y) as natural attrition and targeted distribution reduced placements; total active players/screens fell to ~81,000 from ~83,000 in Q2 .

Financial Results

Income Statement and Profitability (Quarterly)

Metric	Q1 2024	Q2 2024	Q3 2024
Revenue ($USD)	$10,171,256	$4,002,463	$4,350,570
Gross Profit ($USD)	$3,624,539	$418,163	$910,357
Gross Margin (%)	35.6%	10.4%	20.9%
Net Loss ($USD)	$(5,285,402)	$(7,570,633)	$(5,451,617)
Diluted EPS ($USD)	$(0.09)	$(0.11)	$(0.07)
Adjusted EBITDA ($USD)	$(1,482,189)	$(4,545,084)	$(2,247,970)

Year-over-Year Comparison (Q3 2024 vs Q3 2023)

Metric	Q3 2023	Q3 2024
Revenue ($USD)	$5,734,976	$4,350,570
Gross Profit ($USD)	$1,823,243	$910,357
Gross Margin (%)	31.8%	20.9%
Net Loss ($USD)	$(7,875,532)	$(5,451,617)
Diluted EPS ($USD)	$(0.14)	$(0.07)
Adjusted EBITDA ($USD)	$(3,682,106)	$(2,247,970)

KPIs and Distribution

KPI	Q1 2024	Q2 2024	Q3 2024
O&O QAUs (units)	33,783	32,658	30,486
Partner Screens (count)	~43,000	~50,000	~51,000
Total Active Players + Partner Screens	~77,000	~83,000	~81,000
Cash and Cash Equivalents ($USD)	$3,811,159	$2,197,359	$1,546,088
Net Debt ($USD)	$7.1M	$6.0M	$6.2M

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
SG&A (excluding SBC & D&A) per quarter	Q4 2024 onward; FY 2025	“Maintain around $4M per quarter”	“Maintain under ~$4M per quarter”	Maintained
Vendor/third-party cost eliminations	FY 2025 start (Q1)	“Eliminate ~$750k annual ongoing costs starting Q1 FY25”	Ongoing execution; expectation reiterated	Maintained
Content license restructuring	FY 2024–2025	“Restructure/eliminate fixed fee licenses to align with revenue”	Continued; expected margin improvement over time	Maintained
Distribution (QAUs growth)	FY 2024 onward	“Targeted distribution to grow QAUs q/q”	Reiterated; pivot to targeted geographies and venues	Maintained

No numeric revenue/EPS guidance was issued for Q3 2024 .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q1 2024)	Previous Mentions (Q2 2024)	Current Period (Q3 2024)	Trend
Cost-cutting/SG&A discipline	Focus on lowering costs; SG&A $6.2M	SG&A reduced to $5.7M; workforce changes	SG&A $4.1M; target to maintain ~$4M/qtr	Improving
Ad demand partner changes	Political spend absent; organic revenue; cautious on Q2 seasonality	Major ad demand participant changed algorithms; restored demand but at lower frequency	Continued impact; lower fill frequency persists; footprint growth needed to offset	Headwind persists
Distribution strategy (targeted geographies)	Shift to targeted venues/markets; QAUs reduced sequentially	Continued targeted approach; QAUs −3% q/q	QAUs −7% q/q; emphasis on smaller markets density	Mixed (short-term contraction; strategic pivot)
Content/licensing restructuring	Margin expansion path via mix and renegotiations	Vendor/content license restructuring program initiated	Ongoing; expected margin improvement; eliminating fixed fee licenses	Positive over time
New products/subscriptions (Live channels)	Local ad product in beta; second half contribution	N/A	Live channels subscription incl. NFL RedZone/NFL Network to drive venue value	Positive catalyst
Balance sheet/cash burn	Cash $3.8M; net debt $7.1M	Cash $2.2M; net debt $6.0M	Cash $1.5M; net debt $6.2M; cash burn reduced	Tight liquidity; burn improving

Management Commentary

“We will continue to streamline our operations and create further cost efficiencies… including a two-tier music video service and a non-music subscription offering that includes live channels ranging from live sports events (including The NFL Redzone and The NFL Network)… to support growth opportunities” — Justis Kao, CEO .
“Our revenue… was $4.4 million, a decrease… driven by a major ad demand participant changing their terms… we do not expect to experience the same level of absolute revenue… unless and until we significantly increase our distribution footprint” — Neil Watanabe, CFO .
“We have reduced our cash burn from operations significantly and reduce the level of revenue that is required to become flat or breakeven” — Neil Watanabe .
“It’s the perfect time to launch this subscription opportunity for venues… With the NFL season about to start…” — Justis Kao .

Q&A Highlights

Q3 2024 call transcript comprised prepared remarks without a captured Q&A session; no additional guidance clarifications recorded .
In prior quarter context: Q1 Q&A addressed player attrition (minimal revenue impact from removed players), political ad pacing (second-half lift), partner margin mix, and local ad product beta timing .

Estimates Context

Wall Street consensus estimates for Q3 2024 (Revenue/EPS/EBITDA) via S&P Global were unavailable due to platform limits at the time of request; therefore, we cannot assess beats/misses vs consensus for this quarter (Values retrieved from S&P Global)*.
Given management commentary that ad demand frequency is structurally lower under new algorithms unless footprint expands, future consensus may need to reflect lower ad-fill assumptions until distribution accelerates .

Key Takeaways for Investors

Sequential operating improvement: SG&A down to $4.1M and Adjusted EBITDA loss narrowed to $(2.25)M, reducing breakeven revenue threshold; cost actions appear durable into FY2025 .
Ad-tech algorithm shock remains the central headwind; revenue stabilization likely requires footprint expansion and demand partner re-education toward CTV budgets (higher CPM/fill) .
Distribution mix pivot: O&O QAUs declined, but Partner Screens grew to ~51k; targeted market strategy favors density and higher-value venues—expect slower near-term unit growth but potential for improved monetization .
Product catalyst: live channels subscription (NFL RedZone/NFL Network) enhances value proposition for venues ahead of sports season; watch for subscription uptake and ARPU impacts .
Liquidity tight with cash at $1.5M and net debt $6.2M; continued cash burn reduction is critical—monitor vendor savings (~$750k annual) and license renegotiations for margin relief .
No numeric revenue/EPS guidance; focus your model on operating leverage and margin trajectory rather than top-line acceleration until distribution trend inflects .
Given absence of consensus data this quarter, near-term trading likely hinges on operational milestones (subscription uptake, QAU stabilization, margin improvements) and disclosures around delisting proceedings in August (outside earnings scope but market-relevant) .

Non-GAAP Adjustments Note

Adjusted EBITDA excludes interest, taxes, depreciation/amortization, stock-based compensation, non-recurring expenses, restructuring costs, loss on extinguishment of debt, employee retention credits, and other income; use alongside GAAP metrics for a complete view .

Loop Media, Inc. (LPTV)·Q3 2024 Earnings Summary