TradeDoubler (TRAD) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue rose 1% year-over-year to SEK 489M, with gross profit up 8% and gross margin improving to 21.8%.

• Adjusted EBITDA for Q3 was SEK 19M, slightly down from SEK 21M in Q3 2023; EPS was SEK -0.06 versus 0.13.

• Nine-month revenue increased 6% to SEK 1,494M, gross profit up 9%, but EBITDA declined to SEK 53M from SEK 62M.

• Influencer Marketing (Metapic) gross profit grew 91% year-over-year, offsetting a 2% decline in Partner Marketing gross profit.

• Market conditions remain challenging due to weak economies and high inflation, but strategic diversification and a new brand platform aim to drive future growth.

Financial highlights

• Q3 gross margin improved to 21.8% from 20.3% year-over-year; nine-month gross margin at 21.5%.

• Operating costs excluding depreciation rose 13% in Q3 and 14% for the nine months, mainly due to higher salaries and Metapic investments.

• Cash flow from operating activities in Q3 was SEK 31M, up from SEK 3M; nine-month cash flow was SEK 26M, impacted by a SEK 20M one-time publisher payment.

• Net profit for Q3 was SEK -3M (Q3 2023: SEK 6M); nine-month net profit was SEK -1M (2023: SEK 12M).

• Cash and cash equivalents at quarter-end were SEK 41M; net cash position at SEK -30M.

Outlook and guidance

• Management expects continued market headwinds but anticipates growth from product diversification and strategic enhancements.

• Long-term targets: net sales growth above 5% annually in local currency and EBITDA/gross profit ratio above 20% over a business cycle.