Programmatic Advertising Revenues Grew 3%
Year-Over-Year
Affiliate Commerce Revenues Grew 9%
Year-Over-Year
BuzzFeed, Inc. was the Only Digital Media
Company in Competitive Set to Grow Audience Time Spent in Q2 Versus
Q1, according to Comscore1
BuzzFeed, Inc. (Nasdaq: BZFD) reported improved second quarter
(ended June 30, 2024) net loss from continuing operations as
compared to the prior-year period, and Adjusted EBITDA2 ahead of
the Company’s outlook shared on May 13, 2024 and reiterated on July
3, 2024. Second quarter revenues were in line with the Company’s
outlook, with year-over-year growth in two of BuzzFeed, Inc.’s
largest and highest-margin revenue streams - Programmatic
Advertising and Affiliate Commerce.
“Our strong performance in Q2 marks a turning point we’ve been
working toward for the past two years,” said Jonah Peretti,
BuzzFeed Founder & CEO. “We are beginning to see the benefits
of our investment in a differentiated technology platform that
allows us to accelerate AI product development, make our sites and
apps more interactive and personalized, and increase the amount of
content our team and audience can create using AI-powered
tools.”
“These changes are beginning to drive deeper audience engagement
and improved revenue trends on our owned and operated properties,”
Peretti continued. "We are not just focused on making small
optimizations to our business; our ambition is for BuzzFeed to be
the defining digital media company for the AI era, and we will
execute accordingly in the coming years."
Second Quarter 2024 Financial and
Operational Highlights for Continuing Operations
(excluding Complex)3
- BuzzFeed4 delivered Q2 revenues of $46.9 million, declining
24% compared to the second quarter of 2023
- Advertising revenue declined 19% year-over-year to $23.8
million
- Programmatic advertising revenue grew 3% year-over-year to
$16.0 million
- Content revenue declined 48% year-over-year to $11.4
million
- Commerce and other revenues grew 7% year-over-year to
$11.7 million
- Affiliate commerce revenues grew 9% year-over-year to $10.4
million
- Net loss from continuing operations was $(6.5) million,
compared to a net loss from continuing operations of $(22.5)
million in the second quarter of 2023
- Adjusted EBITDA was $2.7 million, compared to Adjusted
EBITDA loss of $(2.2) million in the second quarter of 2023, a
year-over-year improvement of approximately $5 million
- Time Spent5 declined 5% year-over-year to 71 million
hours
Business and Content
Highlights
- BuzzFeed, Inc. continued to outpace its peers in Q2 as the
only digital media company in our competitive set to grow time
spent in Q2, up 5% as compared to Q1, according to Comscore.
Further, time spent among our core demographic — Millennials and
Gen Z — grew 11% versus Q1.
- Direct traffic referrals are our largest source of
traffic: in Q2, 90% of audience time spent with our content was
on our owned and operated properties. And, direct traffic across
BuzzFeed and HuffPost continued to show stability through the
quarter.
- The BuzzFeed team has made great progress improving audience
loyalty: the number of loyal users — users who return to the
BuzzFeed web and app more than once in a 7-day period — has grown
11% since Q4 2023.
- Engagement has also deepened among our user base, with
the number of page views per unique site visitor growing for the
third consecutive quarter.
- The Company posted a record Prime Day in July, with
strong double-digit growth in revenues year-over-year, outpacing
Amazon’s overall Prime Day growth6.
Third Quarter 2024 Financial
Outlook
- We expect overall revenues in the range of $58
million to $63 million, or approximately 3% lower to 5% higher
than third quarter of 2023
- We expect Adjusted EBITDA in the range of $6
million to $11 million, approximately $8 million higher
year-over-year at the midpoint
These statements are forward-looking and actual results may
differ materially as a result of many factors. Refer to
“Forward-Looking Statements” below for information on factors that
could cause our actual results to differ materially from these
forward-looking statements.
Please see “Non-GAAP Financial Measures” below for a description
of how Adjusted EBITDA is calculated. While Adjusted EBITDA is a
non-GAAP financial measure, we have not provided guidance for the
most directly comparable GAAP financial measure — net income (loss)
from continuing operations — due to the inherent difficulty in
forecasting and quantifying certain amounts that are necessary to
forecast such a measure. Accordingly, a reconciliation of non-GAAP
guidance for Adjusted EBITDA to the corresponding GAAP measure is
not available.
Quarterly Conference
Call
BuzzFeed’s management team will hold a conference call to
discuss our second quarter 2024 results today, August 12, at 5PM
ET. The call will be available via webcast at
investors.buzzfeed.com under the heading News and Events, and
parties interested in participating must register in advance at the
same location. Upon registration, all telephone participants will
receive a confirmation email detailing how to join the conference
call, including the dial-in number along with a unique PIN that can
be used to access the call. While it is not required, it is
recommended you join 10 minutes prior to the event start time. A
replay of the call will be made available at the same URL.
We have used, and intend to continue to use, the Investor
Relations section of our website at investors.buzzfeed.com as a
means of disclosing material nonpublic information and for
complying with our disclosure obligations under Regulation FD.
Definitions
BuzzFeed reports revenues across three primary business lines:
Advertising, Content and Commerce and other. The definition of Time
Spent is also set forth below.
- Advertising revenues are primarily generated from
advertisers for ads distributed against our editorial and news
content, including display, pre-roll and mid-roll video products
sold directly to brands and also programmatically. We distribute
these ad products across our owned and operated sites as well as
third-party platforms, primarily YouTube and Apple News.
- Content revenues are primarily generated from clients
for custom assets, including both long-form and short-form content,
from branded quizzes to Instagram takeovers to sponsored content
and content licensing. Revenues for film and TV projects are also
included here.
- Commerce and other revenues consist primarily of
affiliate commissions earned on transactions initiated from our
editorial shopping content. Revenues from our product licensing
businesses are also included here.
- Time Spent captures the time audiences spend engaging
with our content in the U.S. across our owned and operated sites,
as well as YouTube and Apple News, as measured by Comscore. This
metric excludes time spent with our content on platforms for which
we have minimal advertising capabilities that contribute to our
Advertising revenues, including Instagram, TikTok, Facebook,
Snapchat and Twitter. There are inherent challenges in measuring
the total actual number of hours spent with our content across all
platforms; however, we consider the data reported by Comscore to
represent industry-standard estimates of the time actually spent on
our largest distribution platforms with our most significant
monetization opportunities. Time Spent presented above excludes
time spent on Complex Networks, as Complex Networks is presented as
a discontinued operation within our condensed consolidated
financial statements. Time Spent on Complex Networks, as reported
by Comscore, was approximately 10.0 million hours through the date
of Disposition, February 21, 2024, and 21.2 million and 50.0
million hours for the three and six months ended June 30, 2023,
respectively. Time Spent on Complex Networks, as reported by
Comscore, previously included Time Spent on First We Feast, as
First We Feast was historically under the Complex Networks’
measurement portfolio of Comscore. However, the historical Time
Spent on First We Feast cannot be reasonably bifurcated from Time
Spent on Complex Networks. Accordingly, for comparability of Time
Spent, we have excluded Time Spent on First We Feast from our
measure of Time Spent for all periods presented above and for
future reporting of Time Spent.
About BuzzFeed, Inc.
BuzzFeed, Inc. is home to the best of the Internet. Across pop
culture, entertainment, shopping, food and news, our brands drive
conversation and inspire what audiences watch, read, and buy
now—and into the future. Born on the Internet in 2006, BuzzFeed is
committed to making it better: providing trusted, quality,
brand-safe news and entertainment to hundreds of millions of
people; making content on the Internet more inclusive, empathetic,
and creative; and inspiring our audience to live better lives.
Non-GAAP Financial Measures
Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP
financial measures and represent key metrics used by management and
our board of directors to measure the operational strength and
performance of our business, to establish budgets, and to develop
operational goals for managing our business. We define Adjusted
EBITDA as net loss from continuing operations, excluding the impact
of net income (loss) attributable to noncontrolling interests,
income tax (benefit) provision, interest expense, net, other
(income) expense, net, depreciation and amortization, stock-based
compensation, change in fair value of warrant liabilities, change
in fair value of derivative liability, restructuring costs, and
other non-cash and non-recurring items that management believes are
not indicative of ongoing operations. Adjusted EBITDA margin is
calculated by dividing Adjusted EBITDA by revenue for the same
period.
We believe Adjusted EBITDA and Adjusted EBITDA margin are
relevant and useful information for investors because they allow
investors to view performance in a manner similar to the method
used by our management. There are limitations to the use of
Adjusted EBITDA and Adjusted EBITDA margin and our Adjusted EBITDA
and Adjusted EBITDA margin may not be comparable to similarly
titled measures of other companies. Other companies, including
companies in our industry, may calculate non-GAAP financial
measures differently than we do, limiting the usefulness of those
measures for comparative purposes.
Adjusted EBITDA and Adjusted EBITDA margin should not be
considered a substitute for measures prepared in accordance with
GAAP. Reconciliations of non-GAAP financial measures to the most
directly comparable financial results as determined in accordance
with GAAP are included at the end of this press release following
the accompanying financial data.
Forward-Looking Statements
Certain statements in this press release may be considered
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended, which statements
involve substantial risks and uncertainties. Our forward-looking
statements include, but are not limited to, statements regarding
our management team’s expectations, hopes, beliefs, intentions or
strategies regarding the future. In addition, any statements that
refer to projections, forecasts (including our outlook for Q3 2024)
or other characterizations of future events or circumstances,
including any underlying assumptions, are forward-looking
statements. The words “affect,” “anticipate,” “believe,” “can,”
“contemplate,” “continue,” “could,” “estimate,” “expect,”
“forecast,” “intend,” “may,” “might,” “plan,” “possible,”
“potential,” “predict,” “project,” “seek,” “should,” “target,”
“will,” “would” and similar expressions may identify
forward-looking statements, but the absence of these words does not
mean that a statement is not forward-looking. Forward-looking
statements include all matters that are not historical facts. The
forward-looking statements contained in this press release are
based on current expectations and beliefs concerning future
developments and their potential effects on us. There can be no
assurance that future developments affecting us will be those that
we have anticipated. These forward-looking statements involve a
number of risks, (some of which are beyond our control)
uncertainties or other assumptions that may cause actual results or
performance to be materially different from those expressed or
implied by these forward-looking statements. These risks and
uncertainties include, but are not limited to: (1) developments
relating to our competitors and the digital media industry,
including overall demand of advertising in the markets in which we
operate; (2) demand for our products and services or changes in
traffic or engagement with our brands and content; (3) changes in
the business and competitive environment in which we and our
current and prospective partners and advertisers operate; (4)
macroeconomic factors including: adverse economic conditions in the
United States and globally, including the potential onset of
recession; current global supply chain disruptions; potential
government shutdowns or a failure to raise the U.S. federal debt
ceiling or to fund the federal government; the ongoing conflicts
between Russia and Ukraine and between Israel and Hamas and any
related sanctions and geopolitical tensions, and further escalation
of trade tensions between the United States and China; the
inflationary environment; high unemployment; high interest rates,
currency fluctuations; and the competitive labor market; (5) our
future capital requirements, including, but not limited to, our
ability to obtain additional capital in the future, to settle
conversions of our unsecured convertible notes, repurchase the
notes upon a fundamental change such as the delisting of our Class
A common stock or repay the notes in cash at their maturity any
restrictions imposed by, or commitments under, the indenture
governing our unsecured notes or agreements governing any future
indebtedness, and any restrictions on our ability to access our
cash and cash equivalents; (6) developments in the law and
government regulation, including, but not limited to, revised
foreign content and ownership regulations, and the outcomes of
legal proceedings, regulatory disputes or governmental
investigations to which we are subject; (7) the benefits of our
cost savings measures; (8) our success divesting of companies,
assets or brands we sell or in integrating and supporting the
companies we acquire; (9) technological developments including
artificial intelligence; (10) the impact of activist shareholder
activity, including on our strategic direction; (11) our success in
retaining or recruiting, or changes required in, officers, other
key employees or directors; (12) use of content creators and
on-camera talent and relationships with third parties managing
certain of our branded operations outside of the United States;
(13) the security of our information technology systems or data;
(14) disruption in our service, or by our failure to timely and
effectively scale and adapt our existing technology and
infrastructure; (15) our ability to maintain the listing of our
Class A common stock and warrants on The Nasdaq Stock Market LLC;
and (16) those factors described under the sections entitled “Risk
Factors” in the Company’s annual and quarterly filings with the
Securities and Exchange Commission.
Should one or more of these risks or uncertainties materialize,
or should any of our assumptions prove incorrect, actual results
may vary in material respects from those projected in these
forward-looking statements. There may be additional risks that we
consider immaterial or which are unknown. It is not possible to
predict or identify all such risks. We do not undertake any
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise,
except as may be required under applicable securities laws.
1 Source: Comscore Media Trend, desktop 2+ and mobile 18+, desktop
and mobile; June 2024; [Competitive Set: Dotdash Meredith, Conde
Nast Digital, Vox Media, People, Bustle Digital Group, Vice Media
Group, Hearst]
2 As used throughout, Adjusted EBITDA is a
non-GAAP financial measure. Please refer to “Non-GAAP Financial
Measures” below for a description of how it is calculated and the
tables at the back of this earnings release for a reconciliation of
our GAAP and non-GAAP results.
3 The Company determined the assets of
Complex Networks, excluding the First We Feast brand, met the
classification for “held for sale.” Additionally, the Company
concluded the disposal, which occurred on February 21, 2024,
represented a strategic shift that had a major effect on our
operations and financial results. As such, the historical financial
results of Complex Networks have been reflected as discontinued
operations in our condensed consolidated financial statements.
Amounts presented throughout this press release are on a continuing
operations basis (i.e., excluding Complex Networks).
4 BuzzFeed, Inc. is herein referred to as
“BuzzFeed” or the “Company.”
5 Includes Complex Networks and First We
Feast; see definition of “Time Spent” below.
6 +11% year-over year, according to Adobe
Analytics, as reported by CNBC.
BUZZFEED, INC.
Financial Highlights
(Unaudited, dollars in
thousands)
Three Months Ended June
30,
Six Months Ended June
30,
2024
2023
% Change
2024
2023
% Change Advertising
$
23,814
$
29,412
(19
)%
$
45,237
$
56,805
(20
)%
Content
11,369
21,739
(48
)%
24,476
37,990
(36
)%
Commerce and other
11,749
10,977
7
%
21,974
22,241
(1
)%
Total revenue
$
46,932
$
62,128
(24
)%
$
91,687
$
117,036
(22
)%
Loss from continuing operations
$
(4,214
)
$
(16,422
)
74
%
$
(25,027
)
$
(40,899
)
39
%
Net loss from continuing operations
$
(6,483
)
$
(22,482
)
71
%
$
(33,052
)
$
(51,871
)
36
%
Adjusted EBITDA
$
2,659
$
(2,204
)
221
%
$
(8,605
)
$
(20,292
)
58
%
BUZZFEED, INC.
Condensed Consolidated Balance
Sheets
(Unaudited, dollars and shares
in thousands, except per share amounts)
June 30, 2024(Unaudited) December 31,2023
Assets Current assets Cash and cash equivalents
$
45,461
$
35,637
Accounts receivable (net of allowance for doubtful accounts of
$1,066 as at June 30, 2024 and $1,424 as at December 31, 2023)
46,954
75,692
Prepaid expenses and other current assets
19,260
21,460
Current assets of discontinued operations
-
-
Total current assets
111,675
132,789
Property and equipment, net
8,777
11,856
Right-of-use assets
38,058
46,715
Capitalized software costs, net
22,653
22,292
Intangible assets, net
25,166
26,665
Goodwill
57,562
57,562
Prepaid expenses and other assets
8,963
9,508
Noncurrent assets of discontinued operations
-
104,089
Total assets
$
272,854
$
411,476
Liabilities and Stockholders' Equity Current
liabilities Accounts payable
$
16,556
$
46,378
Accrued expenses
15,209
15,515
Deferred revenue
1,021
1,895
Accrued compensation
13,605
12,970
Current lease liabilities
23,326
21,659
Current debt
101,483
124,977
Other current liabilities
4,796
4,401
Current liabilities of discontinued operations
-
-
Total current liabilities
175,996
227,795
Noncurrent lease liabilities
25,713
37,820
Debt
-
33,837
Warrant liabilities
1,075
406
Other liabilities
753
435
Noncurrent liabilities of discontinued operations
-
-
Total liabilities
203,537
300,293
Commitments and contingencies
Stockholders’
equity Class A common stock, $0.0001 par value; 700,000 shares
authorized; 35,879 and 35,035 shares issued and outstanding at June
30, 2024 and December 31, 2023, respectively
3
3
Class B common stock, $0.0001 par value; 20,000 shares authorized;
1,359 and 1,368 shares issued and outstanding at June 30, 2024 and
December 31, 2023, respectively
1
1
Additional paid-in capital
725,386
723,092
Accumulated deficit
(654,984
)
(611,768
)
Accumulated other comprehensive loss
(3,227
)
(2,500
)
Total BuzzFeed, Inc. stockholders’ equity
67,179
108,828
Noncontrolling interests
2,138
2,355
Total stockholders’ equity
69,317
111,183
Total liabilities and stockholders’ equity
$
272,854
$
411,476
BUZZFEED, INC.
Condensed Consolidated
Statements of Operations
(Unaudited, dollars and shares
in thousands, except per share amounts)
Three Months Ended June
30,
Six Months Ended June
30,
2024
2023
2024
2023
Revenue
$
46,932
$
62,128
$
91,687
$
117,036
Costs and Expenses Cost of revenue, excluding depreciation and
amortization
25,001
38,967
56,064
76,204
Sales and marketing
4,509
10,139
13,654
22,047
General and administrative
14,052
20,765
30,301
42,175
Research and development
2,721
3,351
5,951
6,479
Depreciation and amortization
4,863
5,328
10,744
11,030
Total costs and expenses
51,146
78,550
116,714
157,935
Loss from continuing operations
(4,214
)
(16,422
)
(25,027
)
(40,899
)
Other income (expense), net
2,168
(3,675
)
1,612
(3,055
)
Interest expense, net
(3,981
)
(3,942
)
(8,462
)
(7,729
)
Change in fair value of warrant liabilities
(632
)
395
(669
)
(198
)
Change in fair value of derivative liability
-
1,125
-
120
Loss from continuing operations before income taxes
(6,659
)
(22,519
)
(32,546
)
(51,761
)
Income tax (benefit) provision
(176
)
(37
)
506
110
Net loss from continuing operations
(6,483
)
(22,482
)
(33,052
)
(51,871
)
Net loss from discontinued operations, net of tax
(877
)
(5,354
)
(10,089
)
(12,226
)
Net loss
(7,360
)
(27,836
)
(43,141
)
(64,097
)
Less: net income (loss) attributable to noncontrolling interests
127
-
74
(260
)
Net loss attributable to BuzzFeed, Inc.
$
(7,487
)
$
(27,836
)
$
(43,215
)
$
(63,837
)
Net loss from continuing operations attributable to holders of
Class A and Class B common stock: Basic and diluted
$
(6,610
)
$
(22,482
)
$
(33,126
)
$
(51,611
)
Net loss from continuing operations per Class A and Class B common
share: Basic and diluted
$
(0.18
)
$
(0.63
)
$
(0.90
)
$
(1.46
)
Weighted average common shares outstanding: Basic and diluted
37,007
35,487
36,792
35,332
BUZZFEED, INC.
Condensed Consolidated
Statements of Cash Flows
(Unaudited, USD in
thousands)
Six Months Ended June
30,
2024
2023
Operating activities: Net (loss)
$
(43,141
)
$
(64,097
)
Less: net (loss) from discontinued operations, net of tax
10,089
12,226
Net loss from continuing operations
(33,052
)
(51,871
)
Adjustments to reconcile net loss to net cash used in operating
activities: Depreciation and amortization
10,744
11,030
Unrealized gain on foreign currency
(482
)
(809
)
Stock based compensation
2,499
2,816
Change in fair value of warrants
669
198
Change in fair value of derivative liability
-
(120
)
Amortization of debt discount and deferred issuance costs
2,606
2,307
Deferred income tax
(409
)
341
Provision for doubtful accounts
(358
)
(259
)
Loss (gain) on investment
-
3,590
Gain on disposition of assets
(350
)
(175
)
Non-cash lease expense
8,638
10,173
Changes in operating assets and liabilities: Accounts receivable
30,330
45,871
Prepaid expenses and other current assets and prepaid expenses and
other assets
1,584
1,653
Accounts payable
(29,083
)
9,889
Accrued compensation
696
(11,102
)
Accrued expenses, other current liabilities and other liabilities
473
(11,302
)
Lease liabilities
(10,418
)
(11,822
)
Deferred revenue
(873
)
(2,488
)
Cash used in operating activities from continuing operations
(16,786
)
(2,080
)
Cash used in operating activities from discontinued operations
(8,917
)
(5,650
)
Cash used in operating activities
(25,703
)
(7,730
)
Investing activities: Capital expenditures
(208
)
(471
)
Capitalization of internal-use software
(6,415
)
(7,676
)
Proceeds from sale of asset
350
175
Cash used in investing activities from continuing operations
(6,273
)
(7,972
)
Cash provided by investing activities from discontinued operations
108,575
-
Cash provided by (used in) investing activities
102,302
(7,972
)
Financing activities: Proceeds from exercise of stock
options
1
29
Payment for shares withheld for employee taxes
(230
)
(220
)
Borrowings on Revolving Credit Facility
-
2,128
Payments on Revolving Credit Facility
(33,837
)
(1,317
)
Payment on Convertible Notes
(31,233
)
-
Proceeds from the issuance of common stock in connection with the
at-the-market offering, net of issuance costs
-
765
Payment of early termination fee for Revolving Credit Facility
(500
)
-
Payment of deferred issuance costs
(597
)
-
Cash (used in) provided by financing activities
(66,396
)
1,385
Effect of currency translation on cash and cash equivalents
(379
)
(162
)
Net increase (decrease) in cash and cash equivalents
9,824
(14,479
)
Cash and cash equivalents at beginning of period
35,637
55,774
Cash and cash equivalents at end of period
$
45,461
$
41,295
BUZZFEED, INC.
Reconciliation of GAAP to
Non-GAAP
(Unaudited, USD in
thousands)
Three Months Ended June
30,
Six Months Ended June
30,
2024
2023
2024
2023
Net loss from continuing operations
$
(6,483
)
$
(22,482
)
$
(33,052
)
$
(51,871
)
Income tax (benefit) provision
(176
)
(37
)
506
110
Interest expense, net
3,981
3,942
8,462
7,729
Other (income) expense, net
(2,168
)
3,675
(1,612
)
3,055
Depreciation and amortization
4,863
5,328
10,744
11,030
Stock-based compensation
1,747
2,129
2,499
2,816
Change in fair value of warrant liabilities
632
(395
)
669
198
Change in fair value of derivative liability
—
(1,125
)
—
(120
)
Restructuring(1)
263
6,761
3,179
6,761
Adjusted EBITDA
$
2,659
$
(2,204
)
$
(8,605
)
$
(20,292
)
Adjusted EBITDA margin
5.7
%
(3.5
)%
(9.4
)%
(17.3
)%
Net loss from continuing operations as a percentage of revenue(2)
(13.8
)%
(36.2
)%
(36.0
)%
(44.3
)%
_____________________________________________________
(1) We exclude restructuring expenses from our non-GAAP measures
because we believe they do not reflect expected future operating
expenses, they are not indicative of our core operating
performance, and they are not meaningful in comparison to our past
operating performance.
(2) Net loss from continuing operations as a percentage of
revenue is included as the most comparable GAAP measure to Adjusted
EBITDA margin, which is a Non-GAAP measure.
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