System1 Q2 Results: Revenue of $78.1M, GAAP Gross Profit Up 7% YoY, Adjusted EBITDA Increases 18% YoY

System1 has reported Q2 revenue of $78.1M, beating expectations by $4.76M. GAAP gross profit increased 7% YoY to $27.9M, while adjusted gross profit rose 6% YoY to $41M. GAAP net loss improved 38% YoY to $21.5M, and adjusted EBITDA increased 18% YoY to $11.7M.

System1, Inc. (NYSE: SST) reported its second quarter 2025 financial results, with GAAP revenue of $78.1 million, exceeding analyst expectations by $4.76 million. The company's GAAP gross profit increased 7% year-over-year (YoY) to $27.9 million, while adjusted gross profit rose 6% YoY to $41.0 million. GAAP net loss improved 38% YoY to $21.5 million, and adjusted EBITDA increased 18% YoY to $11.7 million [1].

The company's owned-and-operated products segment revenue grew 34% YoY, driven by higher user engagement and margin expansion. System1's proprietary data and technology, including its Responsive Acquisition Marketing Platform (RAMP), continue to drive growth and profitability. The company's core products, such as Startpage (a privacy-focused search engine), MapQuest (an online mapping service), and CouponFollow (a coupon and shopping platform), showed strong performance [2].

Despite the positive results, System1 has withheld financial guidance for the next quarter due to ongoing advertising market volatility and partner uncertainty. The company's marketing division continues to navigate a volatile advertising landscape, with revenue from marketing-driven segments lagging prior-year levels. However, the company's focus on product innovation and user experience, along with its investment in artificial intelligence, positions it well to deliver sustained value [1].

System1 ended the quarter with $63.6 million in cash and equivalents, and debt totaling $263.3 million. The company's book value for equity declined, mainly due to ongoing intangible asset amortization. System1 does not currently pay a dividend [1].

Looking ahead, investors and analysts will closely watch the health and growth rate of System1's owned-and-operated products segment, its ability to control costs, and any updates regarding its main advertising partners. The company's leverage remains high, with debt in relation to cash and book equity. Additionally, user and engagement growth for Startpage, MapQuest, and CouponFollow will be key metrics to monitor [1].

References:
[1] https://www.nasdaq.com/articles/system1-sst-fiscal-q2-revenue-tops-6
[2] https://www.businesswire.com/news/home/20250807855318/en/System1-Announces-Strong-Second-Quarter-2025-Financial-Results