Company Completes Transformation to
O&O-Led Platform
Flagship BuzzFeed Properties Show Early
Momentum with 3% Growth In Direct Traffic Versus Q4
BuzzFeed, Inc1.’s (Nasdaq: BZFD) reported first quarter (ended
March 31, 2024) financial results in line with the company’s
outlook shared on March 25, 2024.
“We closed the first quarter of 2024 with exciting momentum in
our business, completing the biggest step in our transformation,
which was to refocus the company on our owned and operated sites
and apps, and away from the platform-dependent model of
distribution,” said Jonah Peretti, BuzzFeed Founder &
CEO. “Today, our direct audience is our largest source of
traffic to BuzzFeed’s websites and apps, and this audience is
growing, which represents a huge opportunity for us to drive deeper
engagement with several new content initiatives in our
pipeline.”
Peretti continued, "Our flagship BuzzFeed brand continues to
lead digital media in time spent. We're poised to further extend
this leadership with the integration of AI, driving both creative
storytelling and the evolution of our business."
First Quarter 2024 Financial and
Operational Highlights for Continuing Operations
(excluding Complex)2
- BuzzFeed delivered Q1 revenues of $44.8 million, declining
18% compared to the first quarter of 2023
- Advertising revenue declined 22% year-over-year to $21.4
million
- Content revenue declined 19% year-over-year to $13.1
million
- Commerce and other revenues declined 9% year-over-year
to $10.2 million
- Net loss from continuing operations was $(26.6) million,
compared to a net loss from continuing operations of $(29.4)
million in the first quarter of 2023
- Adjusted EBITDA3 loss was $(11.3) million, compared to
Adjusted EBITDA loss of $(18.1) million in the first quarter of
2023, an improvement of approximately $7 million
- Time Spent4 declined 16% year-over-year to 67 million
hours
First Quarter 2024 Business and Content
Highlights
- Programmatic advertising revenues grew year-over-year
across the BuzzFeed and HuffPost websites and apps for the third
consecutive quarter.
- Direct traffic referrals are our largest source of
traffic: in Q1, 90% of audience time spent with our content was
on our owned and operated properties.
- We are starting to see that audience grow: in Q1, direct
traffic across the BuzzFeed web and app properties increased 3%
versus Q4.
- Engagement deepened among our most loyal audience,
with the number of pageviews per site visitor growing for four
consecutive months since December 2023.
- Our new AI Content Generator, Make Your Own Emoji,
skyrocketed to the top 10 most engaged BuzzFeed posts of all
time.
Second Quarter 2024 Financial
Outlook
- We expect overall revenues in the range of $44 to $49
million, or approximately 21% to 30% lower than second quarter
of 2023
- We expect Adjusted EBITDA3 in the range of $(4)
million in losses to $1 million in profits,
approximately flat 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 first quarter 2024 results today, May 13, 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 and 28.7 million hours
for the three months ended March 31, 2024 and 2023, respectively
(through the date of disposition, February 21, 2024, for the three
months ended March 31, 2024). 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 loss attributable to noncontrolling interests, income tax
provision, interest expense, net, other expense (income), 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 Q2 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
restructuring; (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) our success in retaining or recruiting, or
changes required in, officers, other key employees or directors;
(11) use of content creators and on-camera talent and relationships
with third parties managing certain of our branded operations
outside of the United States; (12) the security of our information
technology systems or data; (13) disruption in our service, or by
our failure to timely and effectively scale and adapt our existing
technology and infrastructure; (14) our ability to maintain the
listing of our Class A common stock and warrants on The Nasdaq
Stock Market LLC; and (15) 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 "BuzzFeed” or the “Company” 2 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). 3 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. 4 Excludes Complex
Networks and First We Feast; see definition of “Time Spent”
below.
BUZZFEED, INC.
Financial Highlights
(Unaudited, dollars in
thousands)
Three Months Ended March 31,
2024
2023
%Change Advertising
$
21,423
$
27,393
(22
)%
Content
13,107
16,251
(19
)%
Commerce and other
10,225
11,263
(9
)%
Total revenue
$
44,755
$
54,907
(18
)%
Loss from continuing operations
$
(20,813
)
$
(24,480
)
15
%
Net loss from continuing operations
$
(26,569
)
$
(29,392
)
10
%
Adjusted EBITDA
$
(11,264
)
$
(18,089
)
38
%
BUZZFEED, INC.
Consolidated Balance
Sheets
(Unaudited, dollars and shares
in thousands, except per share amounts)
March 31, 2024(Unaudited) December 31,2023
Assets Current assets Cash and cash equivalents
$
44,457
$
35,637
Restricted cash
17,050
-
Accounts receivable (net of allowance for doubtful accounts of
$1,351 as at March 31, 2024 and $1,424 as at December 31, 2023)
50,982
75,692
Prepaid expenses and other current assets
20,424
21,460
Current assets of discontinued operations
-
-
Total current assets
132,913
132,789
Property and equipment, net
10,324
11,856
Right-of-use assets
42,430
46,715
Capitalized software costs, net
22,142
22,292
Intangible assets, net
25,801
26,665
Goodwill
57,562
57,562
Prepaid expenses and other assets
7,865
9,508
Noncurrent assets of discontinued operations
-
104,089
Total assets
$
299,037
$
411,476
Liabilities and Stockholders' Equity Current
liabilities Accounts payable
$
22,544
$
46,378
Accrued expenses
16,532
15,515
Deferred revenue
2,401
1,895
Accrued compensation
19,002
12,970
Current lease liabilities
22,476
21,659
Current debt
100,435
124,977
Other current liabilities
6,347
4,401
Current liabilities of discontinued operations
-
-
Total current liabilities
189,737
227,795
Noncurrent lease liabilities
31,858
37,820
Debt
-
33,837
Warrant liabilities
442
406
Other liabilities
1,160
435
Noncurrent liabilities of discontinued operations
-
-
Total liabilities
223,197
300,293
Commitments and contingencies
Stockholders’
equity Class A common stock, $0.0001 par value; 700,000 shares
authorized; 35,079 and 35,035 shares issued and outstanding at
March 31, 2024 and December 31, 2023, respectively
3
3
Class B common stock, $0.0001 par value; 20,000 shares authorized;
1,368 and 1,368 shares issued and outstanding at March 31, 2024 and
December 31, 2023, respectively
1
1
Additional paid-in capital
723,868
723,092
Accumulated deficit
(647,497
)
(611,768
)
Accumulated other comprehensive loss
(2,677
)
(2,500
)
Total BuzzFeed, Inc. stockholders’ equity
73,698
108,828
Noncontrolling interests
2,142
2,355
Total stockholders’ equity
75,840
111,183
Total liabilities and stockholders’ equity
$
299,037
$
411,476
BUZZFEED, INC.
Consolidated Statements of
Operations
(Unaudited, dollars and shares
in thousands, except per share amounts)
Three Months Ended March 31,
2024
2023
Revenue
$
44,755
$
54,907
Costs and Expenses Cost of revenue, excluding depreciation and
amortization
31,063
37,237
Sales and marketing
9,145
11,908
General and administrative
16,249
21,410
Research and development
3,230
3,128
Depreciation and amortization
5,881
5,704
Total costs and expenses
65,568
79,387
Loss from continuing operations
(20,813
)
(24,480
)
Other (expense) income, net
(556
)
620
Interest expense, net
(4,481
)
(3,787
)
Change in fair value of warrant liabilities
(37
)
(593
)
Change in fair value of derivative liability
-
(1,005
)
Loss from continuing operations before income taxes
(25,887
)
(29,245
)
Income tax provision
682
147
Net loss from continuing operations
(26,569
)
(29,392
)
Net loss from discontinued operations, net of tax
(9,213
)
(6,869
)
Net loss
(35,782
)
(36,261
)
Less: net loss attributable to noncontrolling interests
(53
)
(260
)
Net loss attributable to BuzzFeed, Inc.
$
(35,729
)
$
(36,001
)
Net loss from continuing operations attributable to holders of
Class A and Class B common stock: Basic and diluted
$
(26,516
)
$
(29,132
)
Net loss from continuing operations per Class A and Class B common
share: Basic and diluted
$
(0.72
)
$
(0.83
)
Weighted average common shares outstanding: Basic and diluted
36,578
35,176
BUZZFEED, INC.
Consolidated Statements of
Cash Flows
(Unaudited, USD in
thousands)
Three Months Ended March 31,
2024
2023
Operating activities: Net (loss)
$
(35,782
)
$
(36,261
)
Less: net (loss) from discontinued operations, net of tax
9,213
6,869
Net loss from continuing operations
(26,569
)
(29,392
)
Adjustments to reconcile net loss to net cash used in operating
activities:
-
-
Depreciation and amortization
5,881
5,704
Unrealized gain on foreign currency
(46
)
(958
)
Stock based compensation
752
687
Change in fair value of warrants
37
593
Change in fair value of derivative liability
-
1,005
Amortization of debt discount and deferred issuance costs
1,226
1,064
Deferred income tax
493
(21
)
Provision for doubtful accounts
(74
)
223
Gain on disposition of assets
-
(175
)
Non-cash lease expense
4,261
5,034
Changes in operating assets and liabilities: Accounts receivable
26,101
43,837
Prepaid expenses and other current assets and prepaid expenses and
other assets
1,037
1,979
Accounts payable
(23,123
)
(95
)
Accrued compensation
6,062
(12,772
)
Accrued expenses, other current liabilities and other liabilities
3,315
(5,183
)
Lease liabilities
(5,116
)
(5,862
)
Deferred revenue
505
(2,395
)
Cash used in (provided by) operating activities from continuing
operations
(5,258
)
3,273
Cash used in operating activities from discontinued operations
(8,041
)
(3,452
)
Cash used in operating activities
(13,299
)
(179
)
Investing activities: Capital expenditures
(88
)
(402
)
Capitalization of internal-use software
(3,330
)
(3,974
)
Proceeds from sale of asset
-
175
Cash used in investing activities from continuing operations
(3,418
)
(4,201
)
Cash provided by investing activities from discontinued operations
108,575
-
Cash provided by (used in) investing activities
105,157
(4,201
)
Financing activities: Proceeds from exercise of stock
options
-
29
Payment for shares withheld for employee taxes
-
(193
)
Payments on Revolving Credit Facility
(33,837
)
(1,317
)
Payment on Convertible Notes
(30,900
)
-
Payment of early termination fee for Revolving Credit Facility
(500
)
-
Payment of deferred issuance costs
(591
)
-
Cash used in financing activities
(65,828
)
(1,481
)
Effect of currency translation on cash and cash equivalents
(160
)
34
Net increase (decrease) in cash and cash equivalents
25,870
(5,827
)
Cash and cash equivalents and restricted cash at beginning of
period
35,637
55,774
Cash and cash equivalents and restricted cash at end of period
$
61,507
$
49,947
BUZZFEED, INC.
Reconciliation of GAAP to
Non-GAAP
(Unaudited, USD in
thousands)
Three Months Ended March 31,
2024
2023
Net loss from continuing operations
$
(26,569
)
$
(29,392
)
Income tax provision
682
147
Interest expense, net
4,481
3,787
Other expense (income), net
556
(620
)
Depreciation and amortization
5,881
5,704
Stock-based compensation
752
687
Change in fair value of warrant liabilities
37
593
Change in fair value of derivative liability
—
1,005
Restructuring(1)
2,916
—
Adjusted EBITDA
$
(11,264
)
$
(18,089
)
Adjusted EBITDA margin
(25.2
)%
(32.9
)%
Net loss from continuing operations as a percentage of revenue(2)
(59.4
)%
(53.5
)%
__________________________________
(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 comparisons 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.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240513030918/en/
Media Juliana Clifton, BuzzFeed:
juliana.clifton@buzzfeed.com Investor Relations Amita
Tomkoria, BuzzFeed: investors@buzzfeed.com
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