Digital Turbine (APPS) Q3 2025 earnings summary

Executive summary

• Fiscal Q3 2025 revenue was $134.6M, up 13% sequentially but down 5.6% year-over-year; nine-month revenue was $371.4M, down 14.1%.

• GAAP net loss for Q3 FY2025 was $23.1M (EPS $(0.22)), compared to $14.1M loss (EPS $(0.14)) a year ago; nine-month net loss was $73.3M, improved from $183.9M loss last year.

• Transformation program initiated in October 2024, including workforce reductions and cost optimization, targeting $25M+ in annual savings.

• Acquisition of One Store International completed in November 2024 to expand alternative app market business in Europe and the US.

• CFO transition announced, with Stephen Lasher joining and Barrett Garrison supporting the transition.

Financial highlights

• Revenue reached $134.6M; Adjusted EBITDA was $22M, up 44% sequentially but down 13% year-over-year; non-GAAP EPS was $0.13.

• Non-GAAP adjusted net income was $13.7M; GAAP net loss was $23.1M.

• Free cash flow for the quarter was $6.4M; cash balance at quarter-end was $34.6M.

• Gross margin was 44%, down from 45% in Q2 and 48% a year ago.

• Debt balance stood at $408.2M as of December 31, 2024.

Outlook and guidance

• Fiscal 2025 revenue guidance raised to $485M–$490M; projected non-GAAP adjusted EBITDA is $69M–$71M.

• March quarter expected to show year-over-year top-line and nearly 50% EBITDA growth.

• Transformation program expected to be substantially completed by Q1 FY2026, with anticipated annual cash expense savings of over $25M.

• Liquidity deemed sufficient for at least 12 months, with $34.6M in cash and $14M available under the credit facility as of December 31, 2024.

• Management expects continued pressure from weak mobile device sales and macroeconomic uncertainty.