Rumble - Earnings Call - Q4 2024

Executive Summary

• Q4 delivered record revenue of $30.2M (+48% YoY) on stronger advertising, subscriptions, tipping, licensing and platform hosting, while ARPU rose 18% sequentially and MAUs reached 68M (U.S./Canada MAUs +21% q/q to 52M).
• Profitability improved on a non-GAAP basis (Adjusted EBITDA loss narrowed to $13.4M from $30.0M in Q4’23), but GAAP net loss widened to $236.8M due to a $184.7M non-cash derivative loss linked to the Tether strategic investment.
• Guidance: for Q1 2025, management expects “at least 25%” revenue growth vs Q1 2024 and reiterated progress toward Adjusted EBITDA breakeven in 2025; $250M gross proceeds from Tether closed Feb 7, 2025, adding strategic and financial flexibility.
• Cash usage improved for a fifth straight quarter (Q4 cash/equivalents/marketable securities down $18.0M, a 19% improvement vs Q3) and ended Q4 at ~$114M (pre-Tether close); election coverage set records across RAC and subscriptions, supporting monetization momentum into 2025.
• Potential near-term stock catalysts: brand advertising re-engagement post-election, Rumble Premium growth (exclusive content), Tether-enabled initiatives (Rumble wallet, international expansion), and early Rumble Cloud wins (e.g., El Salvador agreement).

What Went Well and What Went Wrong

What Went Well

• Monetization strengthened: ARPU increased to $0.39 from $0.33 in Q3 (+18% q/q) on higher advertising and subscription revenue; MAUs reached 68M with North America MAUs up 21% q/q to 52M.
• Non-GAAP profitability trend improved: Adjusted EBITDA loss narrowed to $13.4M vs $30.0M in Q4’23, continuing a multi-quarter improvement.
• Strategic momentum: closed a $775M Tether investment (including $250M gross proceeds), announced Rumble wallet with Tether, secured El Salvador cloud agreement, and the White House launched an official Rumble channel; CEO framed this as ushering in a “new era” for Rumble.

Management quotes:

• “The fourth quarter delivered another revenue record… registering over $30 million in revenue with 68 million MAUs… U.S. and Canada MAUs jumped 21%… to 52 million”.
• “With more than 400 million international Tether users imagine the possibilities between Rumble and Tether… we expect 4 core impacts on the business” (international expansion, onboarding Tether portfolio to Rumble Cloud, Rumble wallet, balance sheet strength).

What Went Wrong

• GAAP net loss expanded to $236.8M (vs $29.3M Q4’23) due to a $184.7M non-cash derivative fair value loss tied to the Tether transaction, plus a negative $31.2M change in warrant liability.
• Cost of services still exceeded revenue (Q4 cost of services $34.5M vs revenue $30.2M), though down $5.0M YoY on reduced programming/content costs.
• Continued dependence on direct-response advertisers; brand ramp remains a key swing factor into 2025 despite early signs of improvement post-election and GARM’s disbandment.

Transcript

Operator (participant)

Good morning, ladies and gentlemen, and welcome to Rumble's Fourth Quarter and full year 2024 earnings call. All participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press the star key and zero on your telephone keypad. Please note this event is being recorded. I will now turn the conference over to Shannon Devine, Investor Relations for Rumble. Please go ahead.

Shannon Devine (Primary Contact for Investor Relations)

Thank you, Operator. I'm here today with Chris Pavlovski, Founder, Chairman, and CEO of Rumble, and Brandon Alexandroff, CFO. A press release detailing our fourth quarter and full year 2024 results was released today and available on the Investor Relations section of our website. Before we begin the formal presentation, I would like to remind everyone that statements made on this call may include predictions, estimates, or other information that might be considered forward-looking. All forward-looking statements are made only as of the date of this call and should be considered in conjunction with the cautionary statements in our earnings release and the risk factors included in our filings with the SEC. Future company updates will be available via press release and the company's identified social media channels. I'll now turn the call over to Rumble's Chairman, Founder, and CEO, Chris Pavlovski.

Chris Pavlovski (Founder, Chairman, and CEO)

Thanks, Shannon. The fourth quarter was everything we anticipated and much more. While we closed a major chapter in our journey with the U.S. presidential election in November, by late December, we immediately entered an entirely new era when we announced the $775 million strategic investment from Tether. Today, I will address the significant implications of both these events. First, the U.S. presidential election. Rumble cemented its place in the online media ecosystem. According to Streams Charts, we were the top destination for live independent creator election coverage. Both Dan Bongino and Steven Crowder dominated election night in first and second place, respectively, beating out all other platforms and independent creators. Our success was rewarded over a month ago when I was fortunate enough to be invited to the new independent media seat in the White House briefing room with Press Secretary Karoline Leavitt.

This is just one powerful and immediate example of how the media landscape is changing and how well-positioned we are for the future. I see Rumble as the dominant online media force for future election coverage, and as audiences transition from network TV to OTT, Rumble will be positioned to capture this growth. In previous calls, we also discussed the potential impact of the election on our advertising business. With the Trump administration's very strong stance on free speech, we expect to see the artificial headwinds on brand advertising that we faced in 2024 to turn into tailwinds in 2025 and 2026. Due to the environment change, Rumble will be repositioning, investing, and expanding its sales focus to target brands more aggressively. The fourth quarter was something special to watch. We broke internal livestream records without any hiccups from our Rumble Cloud infrastructure.

Moreover, it was the first full quarter with our full revenue suite online, which includes RAC, Sponsorships, and Premium. The results are very promising, and it's now clear to us that we have one of the best monetization engines in the creator economy. The fourth quarter delivered another revenue record in another consecutive quarter of revenue growth, registering over $30 million in revenue with 68 million MAUs. Importantly, our U.S. and Canada MAUs jumped 21% from 43 million in the third quarter to 52 million in the fourth quarter of 2024. As a note, while we are working actively to prepare for brands, it is worth highlighting the success we've had with our performance marketing solution for direct response advertisers. One of our most successful advertising categories has been Precious Metals.

Over the last three years, Rumble's audience has purchased over $750 million of Precious Metals through RAC and Creator sponsorships, a true testament to the audience we have that the brands who advertise on Rumble can no longer be ignored. Second, let's talk about the Tether investment and what this means for Rumble. We closed out 2024 with our most exciting announcement since going public. In December, we announced a $775 million strategic investment from Tether, the largest company in the digital asset industry and the most widely used dollar stablecoin across the world. This transaction was not just a move to fortify the company's balance sheet while providing a liquidity opportunity for all our stockholders. The investment was rooted in extremely strong and not always obvious commonalities between cryptocurrency and free speech communities, both built on a passion for freedom, transparency, and decentralization.

With more than 400 million international Tether users, imagine the possibilities between Rumble and Tether. Going forward, we expect four core impacts on the business. Number one, accelerated international expansion. We expect to leverage Tether's massive presence outside of the U.S. and make inroads with Rumble Video and Rumble Cloud. The first example of this is our recently announced partnership between Rumble Cloud and the government of El Salvador. Once we deliver the cloud, we will be well-positioned to build our presence in El Salvador, draw a new audience to the video platform, and ultimately sell this audience to local advertisers. While we still need to prove this strategy, this is the template that we will look to deploy around the world. A few other countries we are speaking to in the same vein as El Salvador are Macedonia and Panama.

Number two, aggressively expand Rumble Cloud's customer base by onboarding as many Tether portfolio companies onto the Rumble Cloud. Tether has a growing portfolio of nearly 100 companies of various sizes and various cloud needs. Number three, we are now very well-positioned to become the leading media platform in the crypto community. The first tangible project underway is the Rumble Wallet, which we are building alongside Tether to deliver the first crypto wallet to the creator community at scale, accepting and paying out in USD Tether, Tether Gold, and Bitcoin. We expect this to bring direct value to the crypto community on our platform, enable international expansion on the video platform, and facilitate meaningful high-value partnerships with crypto exchanges.

Number four, while we continue to move toward adjusted EBITDA break-even, $250 million in gross proceeds will greatly strengthen our balance sheet and allow us to more fiercely compete with Google's product suite. I want to emphasize this: having one of the most profitable companies in the world backing Rumble has only emboldened our vision to take on Google across their ecosystem, and this is a shared vision from myself and our newest shareholders. We're already taking them on in video, but we plan to get very aggressive on cloud and expand into various other product suites, either by acquisitions or internal development.

Before I turn the call over to Brandon, I want to reiterate one thing is for certain: we are entering a new era for Rumble, one where artificial advertising headwinds have the potential to turn into real tailwinds and one with a powerful ally that is deeply passionate about helping take Rumble to the next level. I've never been more excited for the future of this business. Now, I'll pass to Brandon Alexandroff to walk through the financials.

Brandon Alexandroff (CFO)

Thanks, Chris. I'll now take you through our fourth quarter and full year 2024 financials at a very high level before turning the call over to the operator for Q&A. For the full year of 2024, we reported revenues of $95.5 million, an increase of 18% when compared to $81 million in 2023. For the fourth quarter of 2024, we reported revenues of $30.2 million, compared to $20.4 million for Q4 2023, an increase of $9.8 million, of which $7.9 million was attributable to an increase in audience monetization revenues and $1.9 million to other initiatives. The increase in audience monetization revenues was mainly due to higher revenue from advertising, subscription, tipping fees, licensing, and platform hosting. The increase in other initiative revenues was mostly due to more advertising inventory being monetized by our publisher network and an increase in cloud services offered.

ARPU was $0.39 for the fourth quarter compared to $0.33 in the third quarter of 2024. The increase from the third quarter is attributable to higher advertising revenue and subscription revenue. Cost of Services decreased to $34.5 million for the quarter compared to $39.5 million in the fourth quarter of 2023, primarily due to a reduction in programming and content costs of $5.3 million, offset by an increase of $0.3 million in other Cost of Services, including payment processing fees and costs paid to publishers. For the full year, Cost of Services decreased by $7.7 million to $138.5 million, primarily due to a reduction in programming and content costs of $9.5 million, offset by an increase of $1.8 million in other Cost of Services, including payment processing fees and costs paid to publishers.

You will see in our financial statements a net loss for the fourth quarter of $236.8 million, which compares to a net loss of $29.3 million in the fourth quarter of 2023. Included in the net loss for this quarter was $184.7 million in the change in fair value of derivative expense, which is related to the Tether strategic investment. Adjusted EBITDA for the fourth quarter of 2024 was $13.4 million, a 55% improvement compared to a loss of $30 million in the fourth quarter of 2023. For the full year of 2024, adjusted EBITDA loss was $92.1 million, compared to a loss of $115.3 million in 2023. As we ramp up monetization and maintain discipline around our cost structure, we continue to expect to move materially towards adjusted EBITDA break-even in 2025. As Chris stated, this remains the goal today.

However, with the recently closed capital infusion from Tether, we have the increased flexibility to further invest in initiatives that could accelerate and expand our business sooner than originally anticipated. Moving to our cash position, we ended the year with approximately $114 million in cash, cash equivalents, and marketable securities, compared to $132 million as of September 30, 2024. This does not include the $250 million in gross proceeds to the company upon closing of the Tether transaction on February 7, 2025. During the fourth quarter, you will once again see an improvement in cash, cash equivalents, and marketable securities usage, which has improved in each of the last five quarters. For the fourth quarter, our cash usage was $18 million, representing 19% less usage compared to the third quarter.

As it relates to the first quarter of 2025, given the timing of our call today relative to the end of the first quarter, I wanted to provide some color on our top-line expectations. For the first quarter, we expect revenue growth of at least 25% compared to the first quarter of 2024. Lastly, in the earnings release, we have provided two capitalization tables for reference, showing our fully diluted share count as of December 31, 2024, pre-Tether completion, and as of March 12, 2025, after the Tether transaction was complete. That concludes my prepared remarks. I will now turn the call over to the operator to open up the line for questions.

Operator (participant)

Thank you. We will now be conducting a question-and-answer session. If you would like to ask a question, please press Star, then one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press Star two to leave the question queue. For participants making use of speaker equipment, it may be necessary to pick up your handset before pressing the Star keys. One moment while we pull for questions. Our first question is from Thomas Forte with Maxim Group. Please proceed.

Thomas Forte (Managing Director and Senior Research Analyst)

Great. Thanks. I'm going to ask one question, one follow-up, and I'll get them back in the queue to potentially ask more. First off, Chris, congrats on a tremendous quarter and year. The first question I had was, how should we think about the impact on your monthly active users and other engagement metrics from Dan Bongino being named FBI Deputy Director? Then second part on this one, are there other influencers on your platform that may take roles with the administration that may negatively impact their ability to provide content on Rumble?

Chris Pavlovski (Founder, Chairman, and CEO)

Hi, Tom. Thanks for the question. With respect to the second part of that question, I'm not aware of any other current content creators that may take on roles. Obviously, that could change at any moment's notice, but I'm unaware of anything. With respect to Dan Bongino becoming the Deputy Director, what we did in the last couple of weeks, and we announced on last Monday, is that we launched something called the Rumble Lineup, and we introduced a technology called the Rate Feature that allows one stream to follow another stream. We've seen enormous success on this as of last week. Dan Bongino's last show, I believe, was March 14 or around there.

When we launched the lineup, we had Vince come in and take over Dan Bongino's show on his channel, and then we had Steven Crowder move to the 11:00 A.M. slot, and Tim Pool moved to the noon slot. What we've seen is starting from 9:00 A.M., we were dominating number one in the live streaming space in the United States at 10:00 A.M. as well with Vince, and then 11:00 A.M., Crowder really took on the largest part of that audience, and Tim Pool continued holding number one at the noon slot. We are kind of seeing that throughout the entire week last week. We think the transition there has been incredible, to say the least, and potentially leading us to a bigger opportunity here with expanding that lineup throughout the entire day and into prime time to compete against network TV.

We are really excited about that. Obviously, losing Dan is a huge loss, but we think we filled the gap very well, and Steven Crowder has definitely stepped up to take on a large part of that audience along with Vince. Obviously, adding Tim Pool to our lineup helped a lot as well. We are not seeing any kind of significant change. If anything, what we are seeing is this audience is sticking on a little longer and now watching other shows as well. We are really happy with what we are seeing in the first week.

Thomas Forte (Managing Director and Senior Research Analyst)

Good. That's very encouraging. All right. My second question, and then I'll get back in the queue for more. Earlier this month, you announced Bitcoin treasury purchases. For those investors who may not be familiar, what's the strategy?

Chris Pavlovski (Founder, Chairman, and CEO)

Yeah. We announced a while ago, I think it was back in November or December, that we were going to be adopting a Bitcoin treasury strategy of up to $20 million in Bitcoin purchases. Up until this point, we've invested around $17.1 million into Bitcoin. The strategy behind that is, obviously, I've been very, very pro-Bitcoin my entire life. When the Trump administration came into office, this was an obvious thing for us to do. I felt very strongly that we needed to have a position in this, not just in holding cash, but also holding in Bitcoin. From what I can see, we're one of the top 50 companies holding Bitcoin now with our $17.1 million, top public companies, I should say, that I'm aware of that's holding.

Our strategy here is to make sure that we're aligned with the community that's very enthusiastic in using our product and showing that we really believe in what they believe in. We see this as a really good investment for this company for the long-term.

Thomas Forte (Managing Director and Senior Research Analyst)

Great. Thank you. I appreciate that. I'll get back in the queue.

Operator (participant)

Our next question is from Jason Helfstein with Oppenheimer & Company. Please proceed.

Jason Helfstein (Managing Director and Senior Analyst)

Thanks. Several questions. First, let's start off with kind of the Bitcoin or Rumble Wallet, I guess. Who is going to be kind of doing the development of that? Is Tether going to be bearing the cost of that? Are you going to be bearing the cost of that? Is that something we have to kind of factor in? That's question one. I'll take them off one at a time. Thanks.

Chris Pavlovski (Founder, Chairman, and CEO)

Thanks, Jason. Yeah. Tether is helping with us on that, and they're bearing their own cost on that side and helping us build that. We also are bearing a cost on our side for the implementation of it, but the development is in unison with the Tether teams, and there is no additional cost or any material impact cost on building that that you'll see. It's basically both teams kind of working on their ends of the Rumble Wallet.

Jason Helfstein (Managing Director and Senior Analyst)

Just at a high level, I mean, obviously, Tether has their own reasons for making this investment. I mean, I guess it sounds like some of this potentially will aid demand for Rumble Cloud. Obviously, you've got this kind of Rumble Wallet. I guess just are there other strategic rationale that Tether has, I don't know, perhaps either publicly said or you're aware of, of kind of why they've made this investment from a strategic standpoint?

Chris Pavlovski (Founder, Chairman, and CEO)

Yeah. Strategically speaking, one of the big strategies around the Rumble Wallet is to allow us to go to the international markets. Right now, in terms of having advertisers in international markets, it's very difficult for us. We're very focused in the United States and Canada. Let's just take El Salvador as an example. We'll have the Rumble Wallet available when it's done, and we can now enter a market like El Salvador, and then we can have, whether it's a crypto exchange, whether it's Tether, they can all come in and help advertise that product with influencers that we have in the El Salvadorian market.

The way we see that is it's a real great growth opportunity to grow in an international market and have big advertisers like Tether come in and help promote the Rumble Wallet product, which would carry USDT and Tether Gold along with Bitcoin. This is a real large strategic play with the Rumble Wallet to go very international and tap in into those 400 million Tether users that they have. On the cloud side, they have a lot of portfolio companies that we can tap into and move over to the Rumble Cloud. Those are longer-term plays that take long to onboard, but that's something that's very strategic. They have a lot of portfolio companies. There's revenue there for us to bring in on the cloud side and utilize, and that's something that we're aggressively approaching too.

Both on the international expansion and bringing the ability for people to tip and pay and creators to get paid in Tether around the world is a huge strategic point for them. Obviously, on the cloud is a huge strategic point for them.

Jason Helfstein (Managing Director and Senior Analyst)

Lastly, on a fundamental side, in the fourth quarter, we obviously saw better engagement as relates to U.S. or U.K. and MAU and a nice uptick sequentially in monetization. Maybe, Bridget, how are you thinking about that with respect to the first quarter guide, kind of the brand between the mix between engagement and monetization to get to that first quarter guide? Are you assuming any natural falloff post the election? Thank you.

Chris Pavlovski (Founder, Chairman, and CEO)

Yeah. With respect to the MAUs, what I can say is in the first quarter, being that we're nearly closing out the first quarter here, we have stuck the MAUs in the first quarter better than we have after any other election cycle. As you've probably seen historically, in the mid-term elections, we had a massive drop post the midterm elections in the first quarter from the fourth quarter. We're not going to see that type of massive drop here after the U.S. presidential election. It's going to be a much tighter range than it was in the mid-term elections. That's attributable to the product just being dramatically improved over the last year. We're sticking users better than we ever have, and we're growing in different segments of the market, not just politics.

That's something that I think you're going to see is that we're going to see a tighter range compared to the ranges of drops that we saw from the previous mid-term elections.

Jason Helfstein (Managing Director and Senior Analyst)

Thank you.

Chris Pavlovski (Founder, Chairman, and CEO)

Thanks, Jason.

Operator (participant)

Our next question is a follow-up from Thomas Forte with Maxim Group. Please proceed.

Thomas Forte (Managing Director and Senior Research Analyst)

Great. Thanks for taking my follow-up. I have not asked this type of question in a while. I think it is important. How were you able to get Dr. DisRespect and the White House to join the platform? What is it about the platform today that makes it more attractive to content providers than in the past? At a high level, are you able to add content with more favorable gross margins than in the past?

Chris Pavlovski (Founder, Chairman, and CEO)

I'll attack the last question there first. With respect to the margins on the content, what's very different now than what was available a year ago or two years ago is that our entire product suite is now available from Rumble Premium to RAC to the Sponsorships. Both Premium and RAC really kind of dovetail into each other to help drive higher margins around the creators. We didn't have this a year ago or two years ago, and we didn't realize the impact that would actually have on the margins. We believe that going forward, now that we have these three, it puts us in a place where we're, in my opinion, one of the best places to monetize on the creator economy.

I think we're going to really well, we're definitely going to be stepping on the gas pedal here and bringing on more creators to push the envelope here, especially with this revenue engine that we do have. Now, going with respect to your other questions, the White House, one thing that is definitely true is that Rumble is the lead in the independent creator space for streaming in the political sphere. The White House knows that. We dominated the election cycle, and we continue to dominate almost every morning last week. We were number one at 9:00 A.M., number one at 10:00 A.M., number one at 11:00 A.M., number one at noon in the United States. The White House definitely sees that, and they've definitely rewarded us with bringing their channel onto the platform, so we couldn't be happier about that.

I obviously believe that we should have been with the previous administration and had the White House channel then as well. We were a dominant force then, but it's really nice to be recognized by the current administration how dominant we are in that political news space with respect to content creators. There's just nobody that has that type of influence that Rumble does in the internet sphere. With respect to Dr. DisRespect, we're really making a push into gaming. We've also launched a new creator program here in the first quarter that is showing us tremendous early results, and we are going to be very ambitious in growing this program.

We think this program is here to stay for the long-term, and we're going to be investing very heavily into that going forward because what we're noticing is that it's driving results with respect to the mousetrap of having both Sponsorships, Premium, and RAC. It's really driving results a lot better than what we were anticipating. We are going to step on the gas pedal in gaming and really push a lot harder through our Creator Program that would be open and available to all creators. This is kind of our pivot away from the whole contract, MG contract, things that we do, and kind of move to a very open program that everyone can join and generates both high revenues for the creators and high revenues for Rumble. We are really going to lean into that in the future.

Obviously, if there's a real big opportunity like we had with Tim Pool, we'll definitely look at that, but we're a lot more conscious. We really understand our numbers. We really understand the data now. We know what works, and we know what doesn't. We're really going to lean in on this creator program that we know is working currently.

Thomas Forte (Managing Director and Senior Research Analyst)

Great. Last one, high level. Chris, as a longtime follower of the company and stock, you sound more confident to me about the business than you have in the past. What gives you that confidence? For example, I think you had high expectations heading into 2024 because of the U.S. presidential election, but you actually sound even much better after the election. Can you highlight why you feel that way?

Chris Pavlovski (Founder, Chairman, and CEO)

Thanks, Tom. Having a partner like Tether is obviously a big confidence booster. They're an enormous company, the most profitable company per employee that I'm aware of, and one of the most profitable companies out there. Having them back Rumble, obviously, instills confidence into this company in a way that we haven't seen in someone come in in the past. That's very helpful. We obviously had a really great election cycle, and the results I think are going to be very positive to the Rumble business. I think the advertisers are going to open up, and I think that right now, the line in the sand for this business is direct response. We already have that. The macro economy is not going to really have an impact on direct response, but we have enormous headroom to grow with brands. We're at basically zero right now.

If brands start coming in, then that moves the headroom up a lot and drives our revenue up pretty materially. I see a lot of optimism around there, a lot of optimism around the fact that Tether is coming in, and they're very ambitious about us growing internationally and utilizing their current user base to really grow Rumble internationally. They obviously have the balance sheet to advertise and have the balance sheet to really lean in on Rumble however they want to lean in on it. Most importantly, one of the things that we're very aligned on with the Tether guys is that we want to take on Google head-on, and I've always wanted to do that. We've taken a chip out of YouTube. I think there's a real opportunity for us to do something big on the cloud side. They think that as well.

In terms of even furthering that ecosystem, we're equally excited about adding even more products to the Rumble product line, not just Cloud, not just RAC, not just Video, but really looking into Email, really looking into these other products that we think that our audience, both Rumble's and tapping into Tether's audience, would very much want something like that. We are exploring that right now. That is something we're thinking about, all these different ideas and all these different approaches. It is very consistent with the mission that we've had and how we've wanted to take on Google in the past. The difference now is that we have someone like Tether behind us that really believes in that and has stepped up to come and help us with that. Like you've noticed, I'm very optimistic, and I'm really looking forward to the coming year.

Thomas Forte (Managing Director and Senior Research Analyst)

Excellent. Very, very encouraging and excellent. Thank you.

Operator (participant)

Thank you. Ladies and gentlemen, it appears we have reached the end of our question and answer session. Thank you for attending. You may now disconnect your lines.