Nexxen's Strategic Position in CTV and AI-Driven Advertising: A High-Conviction Growth Story

The digital advertising landscape is undergoing a seismic shift, driven by the rise of connected TV (CTV) and the transformative power of artificial intelligence (AI). At the forefront of this evolution is Nexxen, a company that has strategically positioned itself to capitalize on both trends through its expanded partnership with VIDAA and the launch of its proprietary AI platform, nexAI. For investors seeking high-conviction growth opportunities, Nexxen's dual focus on CTV monetization and AI-driven innovation presents a compelling case.

Strategic Partnership with VIDAA: Unlocking Premium CTV Inventory

Nexxen's renewed and expanded collaboration with VIDAA, announced in August 2025, marks a pivotal step in its CTV strategy. The partnership grants Nexxen exclusive global access to VIDAA's Automatic Content Recognition (ACR) data and monetization rights for video and display advertising on VIDAA media in North America through 2029. This exclusivity provides Nexxen's clients with access to premium inventory unavailable on competing platforms, creating a unique value proposition in the $32.57 billion CTV advertising market (per eMarketer).

The partnership is underpinned by a $60 million investment in VIDAA (6% of its shares), with $35 million added in 2025 to accelerate North American expansion. VIDAA, already a leader in Europe, Australia, and Asia, powers CTVs for brands like Hisense and Toshiba. Nexxen's investment is expected to enhance VIDAA's ACR data scale, user engagement, and retail partnerships, directly benefiting Nexxen's access to high-quality data and ad inventory.

The collaboration also extends to Vestel, a major European CTV manufacturer, further solidifying VIDAA's global footprint. Nexxen's CEO, Ofer Druker, emphasized that this ecosystem creates a “compelling value proposition” for partners, particularly in Europe and North America, where CTV adoption is accelerating. With CTV revenue accounting for 33% of Nexxen's programmatic revenue in Q2 2025 ($28.4 million), the company is well-positioned to capture a growing share of this high-margin market.

AI Innovation with nexAI: Redefining Advertising Efficiency

Nexxen's nexAI platform, launched in Q2 2025, is a vertically integrated AI suite that enhances performance across the advertising lifecycle: planning, activation, optimization, and monetization. Key tools include:
- nexAI Discovery Assistant: Generates audience insights reports with sentiment analysis, interest mapping, and strategic recommendations in minutes, reducing insight development time by 90%.
- AI-Powered DSP Assistant: Enables real-time campaign activation and optimization, bridging the gap between data analysis and execution.

These tools democratize access to Nexxen's rich behavioral data, allowing non-technical users to leverage advanced analytics without external expertise. For example, LG Ad Solutions reported that nexAI's integration enabled faster, more precise campaign planning by layering first-party data with Nexxen's contextual insights. The result? Higher ROI and improved cross-screen targeting.

Financially, nexAI has already driven measurable results. Nexxen's Adjusted EBITDA margin rose to 34% in Q2 2025 (up from 32% in 2024), reflecting operational efficiencies and margin expansion. The company's balance sheet is equally robust, with $131.5 million in cash and no long-term debt, providing flexibility to fund R&D and strategic acquisitions.

Market Differentiation and Long-Term Growth Potential

Nexxen's combination of exclusive CTV partnerships and AI-driven analytics sets it apart in a crowded ad tech space. While competitors focus on automation and data management, Nexxen's generative AI tools offer a holistic, user-centric experience. For instance, the nexAI Discovery Assistant not only identifies audience trends but also generates actionable strategies for immediate activation, a capability unmatched by traditional platforms.

The company's forward guidance for 2025—$380 million in Contribution ex-TAC and $125 million in Adjusted EBITDA—underscores confidence in its AI and CTV strategies. With programmatic advertising accounting for 93% of revenue in Q2 2025, Nexxen is leveraging AI to maintain its leadership in a sector where efficiency and precision are paramount.

Investment Thesis: A High-Conviction Play

For investors, Nexxen represents a rare convergence of strategic partnerships, technological innovation, and financial discipline. The company's exclusive access to VIDAA's ACR data and its AI-driven monetization tools position it to dominate the CTV advertising boom. Additionally, nexAI's ability to streamline campaign workflows and enhance ROI provides a durable competitive edge.

Key risks include market saturation in CTV and regulatory challenges around data privacy. However, Nexxen's focus on first-party data and AI-driven personalization mitigates these risks while aligning with industry trends.

Investment advice: Nexxen is a high-conviction growth stock for investors with a 3–5 year horizon. Its strong balance sheet, expanding CTV revenue, and AI-driven differentiation make it a strategic play in the evolving digital advertising landscape.

In conclusion, Nexxen's strategic alignment with VIDAA and its AI-powered nexAI platform are not just incremental improvements—they are foundational to its long-term growth. As CTV and AI reshape the advertising industry, Nexxen is poised to lead the charge, offering investors a compelling opportunity to capitalize on the next wave of digital transformation.