Rumble Rumbles On: Earnings Beat Sparks Hope, But Challenges Loom

Rumble (NASDAQ: RUM) delivered a rare bright spot in its latest earnings report, posting a GAAP EPS of -$0.01, a $0.09 beat over estimates, while revenue surged to $23.71 million, topping expectations by nearly $1 million. For a company that’s struggled with volatility and skepticism, this is a critical win—but investors must look beyond the headline numbers to the real story: Can Rumble sustain momentum in its tech and cloud sectors while navigating regulatory and profitability hurdles?

The Good: Revenue Growth and Strategic Gains

Let’s start with the positives. Rumble’s Q1 2025 revenue rose 34% year-over-year, driven by its video-sharing platform and Rumble Cloud initiatives. The video platform, with 59 million monthly active users (MAUs), remains a core driver, though user growth has plateaued since late 2022. More importantly, Rumble is making strides in high-margin enterprise markets. Its government contract with El Salvador and partnership with the Tampa Bay Buccaneers underscore its push into cloud infrastructure—a sector analysts like UBS are calling “the next frontier for AI spending.”

The Ugly: Profitability Remains a Hurdle

But here’s the catch: Rumble is still bleeding cash. Its Q1 2025 EBITDA loss was -$18.6 million, and net income plunged to -$28 million. While the GAAP EPS beat was a technical win, the company isn’t close to turning profitable. Management’s goal of breakeven EBITDA by 2026 hinges on scaling cloud contracts and monetizing its user base. With competitors like AWS and Azure dominating the cloud space, Rumble needs aggressive execution to carve out its niche.

The Risk: Regulatory Battles and Leadership Uncertainty

Rumble’s bold stance on free speech and decentralized tech has drawn legal fire. Lawsuits against censorship orders in Brazil and Canada could divert resources and spook investors. Meanwhile, the recent resignation of board member Robert Arsov adds to concerns about leadership stability. This isn’t just a tech play—it’s a high-risk bet on Rumble’s ability to outmaneuver regulators and scale profitably.

The Bottom Line: A Stock for the Brave

Rumble’s earnings beat is a “buy the dip” moment for bulls, but this isn’t a “buy and hold” story. The stock’s -40% three-month decline reflects skepticism about its path to profitability. Yet, with $775 million in funding from Tether and partnerships like its NFL deal, Rumble has the capital to fight. Here’s the math: If it can grow cloud revenue by 50% annually and reduce losses by $10 million yearly, breakeven by 2026 is feasible. But with a $3.3 billion market cap and a negative P/E ratio, the stock is priced for perfection.

Final Take: Hold Your Fire—For Now

Rumble’s beat is a victory, but the road ahead is rocky. Investors should wait for Q2 2025 results (due August 12) to see if revenue momentum holds. Until then, this stock is a speculative play—not for the faint-hearted.

Final Verdict: Rumble’s potential is undeniable, but the risks remain too high to recommend buying without a clear path to profit. Stay on the sidelines unless you’re a high-risk trader willing to bet on its disruptive vision.