Rumble Inc. ("Rumble") (NASDAQ: RUM), the popular video-sharing
platform, announced today financial results for the fiscal quarter
ended March 31, 2023.
Q1 2023 Highlights
- First quarter revenue increased over 336% to $17.6 million,
compared to $4.0 million in the first quarter of 2022.
- Average estimated Minutes Watched Per Month ("MWPM") increased
3% in the first quarter of 2023 to 10.8 billion, compared to 10.5
billion in the first quarter of 2022, and 11.1 billion in the
fourth quarter of 2022.
- Hours of uploaded video per day increased 82% to 11,181 in the
first quarter of 2023, compared to 6,158 in the first quarter of
2022 and 10,373 in the fourth quarter of 2022.
- Average global Monthly Active Users ("MAUs") increased 17% to
48 million, compared to 41 million in the first quarter of 2022,
this compares to 80 million in the fourth quarter of 2022, the
decrease primarily due to the overperformance of Q4, particularly
around the U.S. midterm election cycle. Of the 48 million, 33
million were based in the U.S. and Canada, compared to 29 million
in the U.S. and Canada during the first quarter of 2022.
- As of March 31, 2023, Rumble's balance of cash, cash
equivalents and marketable securities was $326.3 million.
- Made significant progress on its products, including the launch
of a new interface for desktop and mobile web, Roku, and Android,
greatly improving the user experience.
- Launched Supporter Badges and monthly subscriptions to further
monetize the creators’ channels, providing a 100% creator revenue
share for Supporter Badges through the end of 2023.
- Announced Rumble will exclusively manage Steven Crowder’s
content, including his “Mug Club” community, which includes Bryan
Callen, Nick Di Paolo, MrGunsNGear, and former SNL host Jim Breuer,
and popular show “Louder with Crowder.” Crowder, who has more than
1.2 million followers on Rumble, reached over 58,000 subscribers
for his “Mug Club” community prior to the end of the first
quarter.
- Announced Company’s first-ever pay-per-view content with the
exclusive release of Russell Brand's comedy special
"Brandemic."
- Reached agreement with Power Slap for exclusive global rights
to Seasons 2 and 3 of the popular slap fighting league, following
securing streaming exclusivity for Power Slap’s inaugural
event.
- Announced Dan Bongino’s relaunch of “The Dan Bongino Show” as a
live production on Rumble.
- Bolstered the emerging Rumble Exclusives lineup with major
personalities: Dave Rubin, Donald Trump Jr., Bob Menery, Kimberly
Guilfoyle, Kim Iversen, Redacted News, and Rekieta Law.
- Won a legal victory halting the enforcement of a New York law
that would have forced social media platforms to target
constitutionally protected speech.
- Opened a new studio and U.S. headquarters in Longboat Key,
Florida.
- Announced an agreement for rights to Street League
Skateboarding (SLS) and Nitro Rallycross (NRX), in addition to the
previously announced Power Slap, giving Rumble certain exclusive
rights to three sports leagues.
Subsequent to Quarter End
Highlights
- Continued to diversify its content with the announcement of an
exclusive live stream show on Rumble by Kai Cenat, the #1
most-subscribed streamer in the history of Twitch, and IShowSpeed,
the #1 U.S.-based gaming streamer on YouTube.
- Announced the strategic acquisition of David Sacks’s company
Callin, a podcasting and livestreaming platform, positioned to
greatly accelerate Rumble’s product roadmap and enable a world
class live streaming experience.
- Announced an online streaming partnership with the Republican
National Committee (RNC) for the first debate of the Republican
presidential primaries, which is scheduled for August 2023. Rumble
plans to feature the debate on the platform’s home page and make it
available for viewers across the country on the RNC’s Rumble
channel.
- Continued to expand its growing roster of top media influencers
and personalities with the signing of exclusive live streaming
agreements with JiDion and DJ Akademiks.
- Continued its expansion into live sports, with the announced
live sports distribution with Bare Knuckle Fighting Championship
(BKFC).
Management Commentary
“The first quarter of 2023 concluded with a
major milestone of agreements for the rights to three sports
leagues, SLS and NRX, in addition to the previously announced Power
Slap, and subsequent to quarter end the addition of top streamers
Kai Cenat and IShowSpeed. We believe we are not just a leader in
political content, but are also leading in sports and culture.
These mega influencers give us further access to a demographic that
contains one of the most desired audiences to reach,” commented
Rumble's Chairman and CEO, Chris Pavlovski. "This strategic entry
will prove essential as we build out RAC, the foundation for
monetization, and add content to our platform that attracts an
audience desirable to advertisers. The addition of live sports and
top streamers positions Rumble to become the home and future of
live digital sports and culture and will be essential to driving
monetization. Importantly, our user engagement, the best indicator
for our long-term revenue, was an estimated 10.8 billion Minutes
Watched Per Month, and notably our hours of uploaded video on a
year over year basis increased 82% to 11,181. We continue to
capture market share from traditional streaming service providers,
and most importantly Rumble is becoming home for not only our
creators, but also our audiences, best evident by the increase in
consumption.
“We remain in the position to empower and
welcome independent creators offering a world class experience and
the best economic toolkit on the internet. This commitment is
exemplified by the acquisition of Callin, announced today, where an
opportunity presented itself to greatly accelerate our product
roadmap and enable us to build a world class live streaming
experience. Our growth is grounded in our commitment to our mission
and, most importantly, our authenticity. It’s this authenticity
that is the driver of our values, strategic direction and the
foundation of our company. I could not be more thrilled that as
part of today’s announcement we plan to add a mission-aligned board
member in David Sacks in the second half of June 2023. To this
point, as we continue to grow this tremendous company and not
waiver on our mission, we remain mindful of all our constituents,
living the authenticity we preach and priding ourselves on
delivering transparency to our creators, users, and
shareholders.”
Q1 Financial Summary
(Unaudited)
For the three months ended March 31, |
|
2023 |
|
2022 |
|
Variance ($) |
Variance (%) |
|
|
|
|
|
|
|
|
Revenues |
$ |
17,615,375 |
$ |
4,044,765 |
$ |
13,570,610 |
336 |
% |
|
|
|
|
|
|
|
|
Expenses |
|
|
|
|
|
|
|
Cost of services (content, hosting and other) |
$ |
26,014,365 |
$ |
3,742,570 |
$ |
22,271,795 |
595 |
% |
General and administrative |
|
6,900,545 |
|
1,540,367 |
|
5,360,178 |
348 |
% |
Research and development |
|
2,550,561 |
|
792,332 |
|
1,758,229 |
222 |
% |
Sales and marketing |
|
3,297,079 |
|
810,505 |
|
2,486,574 |
307 |
% |
|
|
|
|
|
|
|
|
|
For the first quarter of 2023, revenue was $17.6
million, compared to $4.0 million in the first quarter of 2022, an
increase of 336%. The increase is due to an $11.8 million increase
in advertising revenue and a $1.8 million increase in licensing and
other revenue. The increase in advertising revenue was driven by an
increase in consumption as well as the introduction of new
advertising solutions for creators, publishers and advertisers,
including host read advertising and our online advertising
management exchange (RAC), both of which we started to implement in
the second half of 2022. The increase in licensing and other
revenue was driven by tipping features within our platform as well
as certain cloud, subscription, platform hosting fees, and
provision of one-time content.
Cost of services was $26.0 million for the
quarter, compared to $3.7 million in the first quarter of 2022. The
increase is due to an increase in programming and content costs of
$21.1 million, hosting expenses of $0.5 million, and other service
costs of $0.7 million.
General and administrative expense was $6.9
million for the quarter, compared to $1.5 million in the first
quarter of 2022. The increase is due to a $1.4 million increase in
staffing-related costs, as well as a $4.0 million increase in other
administrative expenses, most of which are public company-related
including accounting, legal, investor relations, insurance and
other administrative services.
Research and development expense was $2.6
million for the quarter, compared to $0.8 million in the first
quarter of 2022. The increase is due to a $1.3 million increase in
staffing-related costs, as well as a $0.5 million increase in costs
related to computer software, hardware and other administrative
expenses.
Sales and marketing expense was $3.3 million for
the quarter, compared to $0.8 million in the first quarter of 2022.
The increase is due to a $0.8 million increase in staffing-related
and consulting service costs, as well as a $1.7 million increase in
other marketing and public relations activities.
Liquidity
As of March 31, 2023, Rumble had cash, cash
equivalents and marketable securities of $326.3 million.
Conference Call Webcast
Information
Rumble will host a conference call at 5:00 p.m.
Eastern Time today, Monday, May 15, 2023, to discuss its quarterly
results. Access to the live webcast and replay of the conference
call will be available here and on Rumble’s Investor Relations
website at investors.rumble.com under ‘News & Events.’
Chris Pavlovski, the Chairman and CEO of Rumble,
will also be interviewed by Matt Kohrs later this evening at 7:00
p.m. Eastern Time. The interview will be streamed live on the Matt
Kohrs Rumble channel at rumble.com/MattKohrs.
Notes on KPIs
Monthly Active Users ("MAUs").
We use MAUs as a measure of audience engagement to help us
understand the volume of users engaged with our content on a
monthly basis. MAUs represent the total web and app users of Rumble
for each month, which allows us to measure our total user base
calculated from data provided by Google, a third-party analytics
provider, using company-set parameters such as excluding users who
access content on Rumble through “embedded” videos on domains other
than rumble.com. We have used Google Analytics since we first began
publicly reporting MAU statistics, and the resulting data have not
been independently verified. There is a potential for minor overlap
in the resulting data due to users who access Rumble’s content from
both the web and the app in a given measurement period; however,
given that we believe this minor overlap to be immaterial, we do
not separately track or report “unique users” as distinct from
MAUs. MAUs do not include embedded video, certain connected TV
users, or users of the Locals platform. We also do not separately
report the number of users who register for accounts in any given
period, which is different from MAUs. Like many other major social
media companies, we rely on significant paid advertising in order
to attract users to our platform; however, we cannot be certain
that all or substantially all activity that results from such
advertising is genuine. Spam activity, including inauthentic and
fraudulent user activity, if undetected, may contribute, from time
to time, to some amount of overstatement of our performance
indicators, including reporting of MAUs by our third-party
analytics provider. We continually seek to improve our ability to
estimate the total number of spam-generated users, and we eliminate
material activity that is substantially likely to be spam from the
calculation of our MAUs. We will not, however, succeed in
identifying and removing all spam.
Estimated Minutes Watched Per Month
(“MWPM”). We use estimated MWPM as a measure of audience
engagement to help us understand the volume of engagement with our
content on a monthly basis. Estimated MWPM represents the monthly
average number of minutes watched within a quarterly period, which
helps us measure the intensity of user engagement. Estimated MWPM
is based on converting actual bandwidth consumption into minutes
watched, using our management’s best estimate of video resolution
quality mix and various encoding parameters. We continually seek to
improve our best estimates based on our observations of creator and
user behavior on the Rumble platform, which changes based on the
introduction of new product features, including livestreaming. We
are currently limited, however, in our ability to collect data from
certain aspects of our systems while we seek to improve our
measurement capabilities. These limits may result in errors that
are difficult to quantify, especially as the proportion of
livestreaming on the Rumble platform increases over time, until we
are able to measure MWPM directly. Bandwidth consumption includes
video traffic across the entire Rumble platform (website, apps,
embedded video, connected TV, etc.), as well as what our management
believes is a nominal amount of non-video traffic. Starting in the
second quarter of 2022 we began transitioning a portion of Locals’
bandwidth consumption to our infrastructure. While this currently
represents an immaterial amount of consumption, we expect this to
grow in the coming quarters.
Hours of Uploaded Video Per
Day. We use the amount of hours of uploaded video per day
as a measure of content creation to help us understand the volume
of content being created and uploaded to us on a daily basis.
We regularly review, have adjusted in the past,
and may in the future adjust our processes for calculating our key
business metrics to improve their accuracy, including through the
application of new data or technologies or product changes that may
allow us to identify previously undetected spam activity. As a
result of such adjustments, our key business metrics may not be
comparable period-over-period.
About Rumble
Rumble is a high-growth neutral video platform
that is creating the rails and independent infrastructure designed
to be immune to cancel culture. Rumble’s mission is to restore the
Internet to its roots by making it free and open once again. For
more information, visit corp.rumble.com.
Forward-Looking Statements
Certain statements in this press release
constitute "forward-looking statements" within the meaning of the
U.S. Private Securities Litigation Reform Act of 1995. Statements
contained in this press release that are not historical facts are
forward-looking statements and include, for example, results of
operations, financial condition and cash flows (including revenues,
operating expenses, and net income (loss)); our ability to meet
working capital needs and cash requirements over the next 12
months; and our expectations regarding future results and certain
key performance indicators. Certain of these forward-looking
statements can be identified by using words such as "anticipates,"
"believes," "intends," "estimates," "targets," "expects,"
"endeavors," "forecasts," "could," "will," "may," "future,"
"likely," "on track to deliver," "gaining momentum," "continues
to," "looks forward to," "begins to focus on," "plans," "projects,"
"assumes," "should" or other similar expressions. Such
forward-looking statements involve known and unknown risks and
uncertainties, and our actual results could differ materially from
future results expressed or implied in these forward-looking
statements. The forward-looking statements included in this release
are based on our current beliefs and expectations of our management
as of the date of this release. These statements are not guarantees
or indicative of future performance. Important assumptions and
other important factors that could cause actual results to differ
materially from those forward- looking statements include, but are
not limited to, our ability to recognize the anticipated benefits
of the Business Combination, which may be affected by, among other
things, our ability to grow and manage growth profitably, maintain
relationships with customers, compete within our industry and
retain key employees; the possibility that we may be adversely
impacted by economic, business, and/or competitive factors; our
limited operating history making it difficult to evaluate our
business and prospects; our inability to effectively manage future
growth and achieve operational efficiencies; our recent and rapid
growth not being indicative of future performance; our inability to
grow or maintain our active user base; our inability to achieve or
maintain profitability; the possibility that we may be unable to
monetize our expansion into live sports as currently anticipated,
including with respect to our relationships with Power Slap, SLS,
NRX and BKFC; the possibility that we may be unable to reach
definitive agreements with either or both Kai Cenat and IShowSpeed
(each of whom has signed a binding term sheet with us), or if
definitive agreements are entered into, the possibility that we may
be unable to monetize such relationships as currently anticipated;
our failure to comply with applicable privacy laws; occurrence of a
cyber incident resulting in information theft, data corruption,
operational disruption and/or financial loss; potential liability
for hosting a variety of tortious or unlawful materials uploaded by
third parties; negative publicity for removing, or declining to
remove, certain content, regardless of whether such content
violated any law; impediment of access to our content and services
on the Internet; significant market competition that we face;
changes to our existing content and services resulting in failure
to attract traffic and advertisers or to generate revenue; our
dependence on third party vendors; our inability to realize the
expected benefits of financial incentives that we offer to our
content creators; potential diversion of management's attention and
consumption of resources as a result of acquisitions of other
companies and success in integrating and otherwise achieving the
benefits of recent and potential acquisitions; failure to maintain
adequate operational and financial resources or raise additional
capital or generate sufficient cash flows; adverse effect on our
business by compliance obligations imposed by new privacy laws,
laws regulating social media platforms and online speech in the
U.S. and Canada; and those additional risks, uncertainties and
factors described in more detail under the caption "Risk Factors"
in our Quarterly Report on Form 10-Q for the quarter ended March
31, 2023, and in our other filings with the Securities and Exchange
Commission. We do not intend, and, except as required by law, we
undertake no obligation, to update any of our forward-looking
statements after the issuance of this release to reflect any future
events or circumstances. Given these risks and uncertainties,
readers are cautioned not to place undue reliance on such
forward-looking statements.
Rumble Social Media
Investors and others should note that we
announce material financial and operational information to our
investors using our investor relations website
(investors.rumble.com), press releases, SEC filings and public
conference calls and webcasts. We also intend to use certain social
media accounts as a means of disclosing information about us and
our services and for complying with our disclosure obligations
under Regulation FD: the @rumblevideo Twitter account
(twitter.com/rumblevideo), the @rumble TRUTH Social account
(truthsocial.com/@rumble), the @chrispavlovski Twitter account
(twitter.com/chrispavlovski), and the @chris TRUTH Social account
(truthsocial.com/@chris), which Chris Pavlovski, our Chairman and
Chief Executive Officer, also uses as a means for personal
communications and observations. The information we post through
these social media channels may be deemed material. Accordingly,
investors should monitor these social media channels in addition to
following our press releases, SEC filings and public conference
calls and webcasts. The social media channels that we intend to use
as a means of disclosing the information described above may be
updated from time to time as listed on our investor relations
website.
For investor inquiries, please
contact:
Shannon Devine MZ Group, MZ North America
203-741-8811 investors@rumble.com
Source: Rumble Inc.
|
Condensed
Consolidated Interim Statements of Comprehensive Loss
(Unaudited) |
|
For the three months ended March 31, |
|
2023 |
|
2022 |
|
|
|
|
|
Revenues |
$ |
17,615,375 |
$ |
4,044,765 |
|
|
|
|
|
Expenses |
|
|
|
|
Cost of services (content, hosting and other) |
$ |
26,014,365 |
$ |
3,742,570 |
General and administrative |
|
6,900,545 |
|
1,540,367 |
Research and development |
|
2,550,561 |
|
792,332 |
Sales and marketing |
|
3,297,079 |
|
810,505 |
Finance costs |
|
- |
|
810,817 |
Share-based compensation |
|
1,800,135 |
|
16,986 |
Foreign exchange loss |
|
15,906 |
|
27,577 |
Amortization and depreciation |
|
681,074 |
|
225,627 |
|
|
|
|
|
Total expenses |
|
41,259,665 |
|
7,966,781 |
|
|
|
|
|
Loss
from operations |
|
(23,644,290) |
|
(3,922,016) |
Interest income |
|
3,307,927 |
|
8,698 |
Share of profit from joint venture |
|
- |
|
1,124 |
Changes in
fair value of warrant liability |
|
(8,331,750) |
|
- |
|
|
|
|
|
Loss before income taxes |
|
(28,668,113) |
|
(3,912,194) |
Income tax
recovery (expense) |
|
- |
|
- |
Deferred tax
recovery (expense) |
|
- |
|
- |
|
|
|
|
|
Net
loss and comprehensive loss |
$ |
(28,668,113) |
$ |
(3,912,194) |
|
|
|
|
|
Loss
per share: |
|
|
|
|
Basic |
$ |
(0.14) |
$ |
(0.02) |
Diluted |
$ |
(0.14) |
$ |
(0.02) |
|
|
|
|
|
Weighted-average shares used to compute loss per
share: |
|
|
|
|
Basic |
|
202,717,669 |
|
173,518,855 |
Diluted |
|
202,717,669 |
|
173,518,855 |
|
|
|
|
|
Condensed
Consolidated Interim Balance Sheets (Unaudited) |
|
|
|
March 31, 2023 |
|
December 31, 2022 |
|
|
|
|
|
Assets |
|
|
|
|
|
|
|
|
|
Current assets |
|
|
|
|
Cash and cash equivalents |
$ |
325,204,642 |
$ |
337,169,279 |
Marketable securities |
|
1,100,000 |
|
1,100,000 |
Accounts receivable, net |
|
5,511,545 |
|
4,748,189 |
Prepaid expenses and other |
|
6,997,177 |
|
9,342,691 |
|
|
338,813,364 |
|
352,360,159 |
Prepaid expenses and other, long term |
|
619,812 |
|
547,589 |
Capital assets |
|
10,155,366 |
|
8,844,232 |
Right-of-use assets |
|
1,166,903 |
|
1,356,454 |
Intangible assets |
|
3,204,733 |
|
3,211,305 |
Goodwill |
|
662,899 |
|
662,899 |
|
$ |
354,623,077 |
$ |
366,982,638 |
|
|
|
|
|
Liabilities and Shareholders' Equity |
|
|
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
Accounts payable and accrued liabilities |
$ |
17,587,702 |
$ |
14,324,696 |
Deferred revenue |
|
3,636,261 |
|
1,040,619 |
Lease liabilities |
|
485,229 |
|
583,186 |
Income taxes payable |
|
934 |
|
934 |
|
|
21,710,126 |
|
15,949,435 |
Warrant liability |
|
18,394,250 |
|
10,062,500 |
Lease liabilities, long-term |
|
742,825 |
|
835,924 |
Other liability |
|
500,000 |
|
500,000 |
|
|
41,347,201 |
|
27,347,859 |
Commitments
and contingencies |
|
|
|
|
|
|
|
|
|
Shareholders' equity |
|
|
|
|
Common
shares |
|
768,357 |
|
768,357 |
Deficit |
|
(57,450,814) |
|
(28,782,701) |
Additional paid-in capital |
|
369,958,333 |
|
367,649,123 |
|
|
313,275,876 |
|
339,634,779 |
|
$ |
354,623,077 |
$ |
366,982,638 |
|
|
|
|
|
Condensed
Consolidated Interim Statements of Cash Flows
(Unaudited) |
|
For the three months ended March 31, |
|
2023 |
|
2022 |
|
|
|
|
|
Cash
flows provided by (used in) |
|
|
|
|
|
|
|
|
|
Operating activities |
|
|
|
|
Net loss and comprehensive loss for the period |
$ |
(28,668,113) |
$ |
(3,912,194) |
Adjustments to reconcile net loss to cash flows: |
|
|
|
|
used in operating activities: |
|
|
|
|
Amortization and depreciation |
|
681,074 |
|
229,416 |
Share-based compensation |
|
2,309,210 |
|
16,986 |
Interest expense |
|
7,459 |
|
7,990 |
Non-cash portion of operating lease costs |
|
145,359 |
|
93,880 |
Repayment of lease liabilities |
|
(154,323) |
|
(51,840) |
Loss on change in fair value of warrants |
|
8,331,750 |
|
- |
Share of profit from joint venture |
|
- |
|
(1,124) |
Changes in
assets and liabilities: |
|
|
|
|
Accounts receivable |
|
(763,356) |
|
(506,045) |
Prepaid expenses |
|
2,273,291 |
|
(1,139,804) |
Accounts payable and accrued liabilities |
|
3,263,003 |
|
1,545,262 |
Deferred revenue |
|
2,595,644 |
|
(306) |
|
|
(9,979,001) |
|
(3,717,779) |
Investing activities |
|
|
|
|
Purchase of capital assets |
|
(1,841,205) |
|
(1,750,949) |
Purchase of intangible assets |
|
(144,431) |
|
- |
|
|
(1,985,636) |
|
(1,750,949) |
|
|
|
|
|
Decrease in cash and cash equivalents during the
period |
|
(11,964,637) |
|
(5,468,728) |
|
|
|
|
|
Cash
and cash equivalents, beginning of period |
|
337,169,279 |
|
46,847,375 |
Cash and cash equivalents, end of
period |
$ |
325,204,642 |
$ |
41,378,647 |
|
|
|
|
|
Supplemental cash flow information: |
|
|
|
|
Cash paid
for income taxes |
$ |
- |
$ |
- |
Cash paid
for interest |
|
- |
|
- |
Cash paid
for lease liabilities |
|
158,067 |
|
65,704 |
|
|
|
|
|
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