Release Date: May 07, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- BuzzFeed Inc (BZFD, Financial) increased editorial output by 17% this quarter, aided by new AI tools.
- AI-powered ad targeting on the Lighthouse platform has improved contextual ad placements, enhancing monetization.
- BuzzFeed Inc (BZFD) saw a 25% increase in article performance with the use of AI tools.
- The company reported a significant improvement in net loss, reducing it by more than half compared to the previous year.
- Commerce and other revenue grew to $10.2 million, driven by a $1 million increase in organic affiliate commerce.
Negative Points
- Total revenue for Q1 2025 declined slightly to $36 million from $37 million in Q1 2024.
- Content revenues decreased to $4.4 million from $6.7 million in the prior year due to fewer direct sold content deals.
- Direct sold advertising revenue declined by $2.1 million year over year.
- The company is operating in a chaotic macroeconomic environment with uncertainties affecting advertiser spending.
- Adjusted EBITDA showed a loss of $5.9 million, although it marks an improvement from the previous year.
Q & A Highlights
Q: Can you touch on BuzzFeed's outlook for macro conditions and what you're hearing from advertisers regarding spend for the year?
A: Jonah Peretti, CEO, explained that advertisers are cautious due to the unpredictable macroeconomic environment, particularly with potential tariff changes. While the overall economy seems strong, uncertainty leads to a wait-and-see approach. He emphasized the significant impact of generative AI technology on the economy, which he believes will be more influential than current political uncertainties.
Q: Do you expect to lean into more programmatic revenue in a more uncertain macro environment? What would be the implication?
A: Jonah Peretti, CEO, stated that programmatic revenue is efficient and scalable, making it resilient in uncertain times. It allows for measurable and efficient advertising, which is appealing to advertisers. He expects programmatic revenue to become a higher percentage of their revenue if economic conditions worsen.
Q: Have you seen any changes from commerce partners as tariffs have been implemented? Do you see any risk to the commerce segment?
A: Matthew Omer, CFO, noted that there has been no significant impact from tariffs on their commerce business. The business is diversified across various retail categories and partners, which helps mitigate risk exposure to tariffs.
Q: What is your outlook for cash flow generation in 2025? How should we think about this conversion from EBITDA to FCF?
A: Matthew Omer, CFO, indicated that while specific guidance on free cash flow isn't provided, they expect positive cash flow from operations, offset by modest capital expenditures and capitalized software. As a digital company, their physical CapEx needs are low, with tech team compensation being a significant capitalized cost.
Q: How is BuzzFeed adapting to the evolving landscape of AI and its impact on the business?
A: Jonah Peretti, CEO, highlighted the integration of AI tools in their publishing business, which has increased editorial output and article performance. They are also developing BF Island, an AI-native social media app, and experimenting with AI-powered user-generated content formats, which have shown high engagement levels.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
