Outbrain Q4 2024 Revenue Falls Short, but Gross Profit and Adjusted EBITDA Surge

Outbrain Inc reported Q4 2024 revenue of $234.6 million, missing estimates by 5% YoY. Net loss was $0.2 million, compared to a net income of $4.1 million in the same quarter last year. However, gross profit increased by 5% to $56.1 million, and adjusted EBITDA rose by 21% to $17.0 million. Free cash flow also increased by 79% to $37.6 million. The company's cash position stood at $166.1 million as of December 31, 2024.

Outbrain Inc (OB), a leading platform that matches audiences with personalized content and ads, recently reported its financial results for the fourth quarter and full year of 2024 [1]. Despite a 5% year-over-year (YoY) decrease in quarterly revenue to $234.6 million, the company showcased significant growth in profitability metrics.

The decline in revenue was influenced by unfavorable foreign currency effects and strategic decisions to focus on engagement and expanding the market presence. However, Outbrain's operational efficiency improved, as indicated by a 5% increase in gross profit to $56.1 million. This improvement in gross profit was driven by a 2.5 percentage point expansion in gross margin to 23.9%.

In addition to the growth in gross profit, Outbrain's adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) increased by 21% YoY to $17.0 million. This growth was achieved despite unfavorable foreign currency effects. Furthermore, free cash flow increased by a significant 79% YoY to $37.6 million.

Outbrain's financial achievements demonstrate the company's commitment to enhancing engagement and expanding its market presence, despite the short-term impact on revenue. As of December 31, 2024, the company's cash position stood at $166.1 million, providing a strong foundation for future growth initiatives.

In conclusion, Outbrain Inc's Q4 2024 financial performance showcases the company's focus on profitability and operational efficiency. Despite a decline in revenue, the company achieved significant growth in gross profit, adjusted EBITDA, and free cash flow. This strategic focus on profitability positions Outbrain well for future growth and expansion.

[1] Source: https://www.gurufocus.com/news/2718766/outbrain-inc-reports-q4-2024-revenue-of-2346-million-missing-estimates-net-loss-of-02-million-amid-strategic-profitability-focus