Acast says second quarter revenue climbed 24% from a year ago, with total sales of $44.8 million. It says growth was not only driven by its business in North America, which was up 26% year-to-year, but also in Europe, where sales grew 25%. Acast had an operating loss of $3 million for the quarter, and negative earnings. But CEO Ross Adams said a nine-point improvement is a “another step closer to profitability” and he remains confident they will be in the black for 2024 overall.
CFO Emily Villatte told investors during a presentation Friday (July 26) that the growth of their business in North America has been driven by market growth, not Acast pulling ad dollars away from other podcast companies. And she said pacing is “clearly strong” in North America for the third quarter.
“When it comes to growth for North America for the rest of the year, we typically don't give a specific guidance,” Villatte said. “But what I would expect is what we've seen in the first half of the year. In other words, North America growing faster.” She said as the market continues to mature, they expect to attract more new brands to podcasting – especially in Europe. “We're investing in markets like America, and becoming more prevalent on the ground there, and that helps our sell through rates. We have a large number of trading deals with major agencies as well, Villatte said.
Adams told investors that Acast is also benefiting from signing deals with more multichannel creators, who are producing not just audio, but also video and social media content that gives them greater monetization opportunities.
“We have refined our multichannel offering due to increased demand from advertisers recognizing the value of such campaigns. And we see more podcasts is keen to extend their brand campaigns across all their channels,” Adams said. “For us, it's about how we monetize that audience across the entirety of wherever people are listening or watching your podcasts short or long form. ad module distributes mainly around the audio offering, but multichannel is becoming a more popular buy. We get multiple requests from advertisers that are very keen to associate themselves and have a creator endorse their product, regardless of where people are listening and watching.” He pointed out Acast’s recent signings and renewals with multichannel creators have included Have A Word, the comedy podcast from Adam Rowe and Dan Nightingale that in April signed to the Acast Creator Network to monetize podcast sponsorships across audio and video. Similar deals have been inked with ShxtsNGigs, The Fellas Studios, and Sweat Daily with Kayla Itsines.
Since its inception in 2014, Acast has continued to expand its global footprint and today is home to over 125,000 podcasts. Like others, Acast is still feeling the impact of Apple’s iOS 17 update that changed how podcast downloads are measured. It reports it had 1.1 billion listens during the second quarter, which was a decrease of 15% compared to the same period last year. But among the listeners it did have, it was better able to monetize them. For each listen during Q2 it had four cents of revenue, up 45% from a year earlier.
Acast has not had the buying history of megadeals like some others – in 2022 it bought the podcast database Podchaserand the publisher Pippa – but has done little other deal-making. Asked if they are exploring any other acquisitions, Villatte said they are “always looking” at deals. “We always keep our ears close to the ground. We have a strong balance sheet, so we have the opportunity to do that,” she said.
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