Nexxen International (NEXN) Q2 2024 earnings summary

Executive summary

• Achieved record Q2 and H1 2024 contribution ex-TAC, programmatic, and CTV revenues, with significant adjusted EBITDA growth and margin expansion, reflecting improved execution and platform enhancements.

• Rebranding to Nexxen increased market recognition and clarified the value proposition, driving new and expanded partnerships.

• Integration of Amobee and launch of Nexxen Data Platform and Unified Identity Graph unified data assets, enabling advanced audience segmentation, insights, and identity solutions.

• Secured key partnerships with Stagwell, United Airlines Commerce Media Network, Kinective Media, and The Trade Desk for data licensing, unlocking new revenue streams and industry recognition.

• Fully repaid $100M long-term debt and launched a new $50M share repurchase program in Q2 2024.

Financial highlights

• Q2 2024 contribution ex-TAC reached $83.1M, up 4% year-over-year and 19% sequentially; programmatic revenue was $78.6M, up 3% year-over-year and 20% sequentially; CTV revenue was $28.2M, up 14% year-over-year and 50% sequentially.

• Adjusted EBITDA was $26.8M, up 27% year-over-year and 126% sequentially, with margin rising to 32% from 26% year-over-year.

• Net cash from operating activities was $20.9M in Q2 2024, up 76% year-over-year; net cash balance at $151.9M as of June 30, 2024, with $90M undrawn credit facility.

• Non-IFRS diluted EPS was $0.09 in Q2 2024, up 37% year-over-year; H1 non-IFRS diluted EPS was $0.10, up 221%.

• Q2 net income was $2.9M, reversing a $5.6M loss in Q2 2023; H1 net loss narrowed to $4.0M from $23.5M.

Outlook and guidance

• Reaffirmed 2024 guidance: contribution ex-TAC of $340–$345M, adjusted EBITDA of ~$100M, and programmatic revenue at ~90% of total revenue.

• Anticipates acceleration in contribution ex-TAC, programmatic, and CTV revenue in H2, with record political contribution ex-TAC expected in Q4.

• Expects continued CTV and data licensing revenue growth in H2 and into 2025, with higher adjusted EBITDA margins.

• GenAI and machine learning to be primary product investment focus in 2025, with increased sales and marketing investments.