Shannon Devine; Investor Relations; Rumble Inc
Chris Pavlovski; Chief Executive Officer, Founder; Rumble Inc
Brandon Alexandroff; Chief Financial Officer; Rumble Inc
Thomas Forte; Analyst; Maxim Group
Jason Helftsein; Analyst; Oppenheimer & Co. Inc.
Operator
Good morning, ladies and gentlemen, and welcome to Rumble Incorporated fourth quarter and full year 2024 earnings call. (Operator Instructions) Please note, this event is being recorded. I will now turn the conference over to Shannon Devine, Investor Relations for Rumble. Please go ahead.
Shannon Devine
Thank you, operator. I'm here today with Chris Pavlovski, Founder, Chairman and CEO of Rumble; and Brandon Alexandroff, CFO. A press release detailing our fourth quarter and full year 2024 results was released today and available on the Investor Relations section of our website.
Before we begin the formal presentation, I would like to remind everyone that statements made on this call may include predictions, estimates or other information that might be considered forward-looking. All forward-looking statements are made only as of the date of this call and should be considered in conjunction with the cautionary statements in our earnings release and the risk factors included in our filings with the SEC. Future company updates will be available via press release and the company's identified social media channels.
I'll now turn the call over to Rumble's Chairman, Founder and CEO, Chris Pavlovski.
Chris Pavlovski
Thanks, Shannon. The fourth quarter was everything we anticipated and much more. While we closed a major chapter in our journey with the US presidential election in November, by late December, we immediately entered an entirely new era when we announced a $775 million strategic investment from Tether. Today, I will address the significant implications of both these events.
First, the US presidential election. Rumble cemented its place in the online media ecosystem. According to stream charts, we were the top destination for live independent creator election coverage, both Dan Bongino and Steven Crowder dominated election night in first and second place, respectively, beating out all other platforms and independent creators. Our success was rewarded over a month ago when I was fortunate enough to be invited to the new independent media seat in the White House briefing room with Press Secretary, Carolyn Leavitt.
This is just one powerful and immediate example of how the media landscape is changing and how well positioned we are for the future. I see Rumble as the dominant online media force for future election coverage and as audiences transition from network TV to OTT, Rumble will be positioned to capture this growth.
In previous calls, we also discussed the potential impact of the election on our advertising business. With the Trump administration's very strong stance on free speech, we expect to see the artificial headwinds on brand advertising that we faced in 2024 to turn into tailwinds in 2025 and 2026. Due to the environment change, Rumble will be repositioning, investing, and expanding its sales focus to target brands more aggressively.
The fourth quarter was something special to watch. We broke internal live stream records without any hiccups for Rumble Cloud infrastructure. Moreover, it was the first full quarter with our full revenue suite online, which includes rack, sponsorships and premium.
The results are very promising, and it's now clear to us that we have one of the best monetization engines in the creator economy. The fourth quarter delivered another revenue record and another consecutive quarter of revenue growth, registering over $30 million in revenue with 68 million MAUs. Importantly, our US and Canada MAUs jumped 21% from $43 million in the third quarter to $52 million in the fourth quarter of 2024.
As a note, while we are working actively to prepare for brands, it is worth highlighting the success we've had with our performance marketing solution for direct response advertisers. One of our most successful advertising categories has been precious metals.
Over the last three years, Rumble's Audience purchased over $750 million of precious metals through rack and creator sponsorships, a true testament to the audience we have that the brands who advertise on Rumble can no longer be ignored.
Second, let's talk about the Tether investment and what this means for Rumble. We closed out 2024 with our most exciting announcement since going public. In December, we announced a $775 million strategic investment from Tether, the largest company in the digital asset industry and the most widely used dollar stable coin across the world. This transaction was not just the move to fortify the company's balance sheet while providing a liquidity opportunity for all our stockholders.
The investment was rooted in an extremely strong and not always obvious commonalities between cryptocurrency and free speech communities, both built on a passion for freedom, transparency, and decentralization. With more than 400 million international Tether users imagine the possibilities between Rumble and Tether. Going forward, we expect four core impacts on the business. Number one, accelerated international expansion. We expect to leverage Tether's massive presence outside of the US and make inroads with Rumble Video and Rumble Cloud.
The first example of this is our recently announced partnership between Rumble Cloud and the government of El Salvador. Once we deliver the cloud, we will be well positioned to build our presence in El Savador, draw a new audience to the video platform and ultimately sell this audience to local advertisers. While we still need to prove this strategy, this is the template that we will look to deploy around the world. A few other countries we are speaking to in the same vein as El Savador or Macedonia and Panama.
Number two, aggressively expand Rumble Cloud's customer base by onboarding as many Tether portfolio companies onto the Rumble Cloud. Tether has a growing portfolio of nearly 100 companies of various size and various cloud needs.
Number three, we are now very well positioned to become the leading media platform in the crypto community. The first tangible project underway is the Rumble Wallet, which we are building alongside Tether to deliver the first crypto wallet to the creator community at scale, accepting and paying out in USD Tether, Tether Gold, and Bitcoin. We expect this to bring direct value to the crypto community on our platform enable international expansion on the video platform and facilitate meaningful high-value partnerships with crypto exchanges.
Number four, while we continue to move toward adjusted EBITDA breakeven, $250 million in gross proceeds will greatly strengthen our balance sheet and allow us to more fiercely compete with Google's product suite. I want to emphasize this. Having one of the most profitable companies in the world backing Rumble has only emboldened our vision to take on Google across their ecosystem. And this is a shared vision from myself and our newest shareholders. We're already taking them on at video, but we plan to get very aggressive on cloud and expand into various other product suites by acquisitions or internal development.
Before I turn the call over to Brandon, I want to reiterate one thing is for certain. We are entering a new era for Rumble, one where artificial advertising headwinds have the potential to turn into real tailwinds in and one with a powerful ally that is deeply passionate about helping take rumble to the next level. I've never been more excited for the future of this business.
Now I'll pass to Brandon Alexandroff to walk through the financials.
Brandon Alexandroff
Thanks, Chris. I'll now take you through our fourth quarter and full year 2024 financials at a very high level before turning the call over to the operator for Q&A. For the full year of 2024, we reported revenues of $95.5 million, an increase of 18% when compared to $81 million in 2023.
For the fourth quarter of 2024, we reported revenues of $30.2 million compared to $20.4 million for Q4 of 2023, an increase of $9.8 million, of which $7.9 million was attributable to an increase in audience monetization revenues and $1.9 million to other initiatives. The increase in audience monetization revenues was mainly due to higher revenue from advertising, subscription, tipping fees, licensing, and platform hosting.
The increase in other initiative revenues was mostly due to more advertising inventory being monetized by our publisher network and an increasing cloud services offered. ARPU was $0.39 for the fourth quarter compared to $0.33 in the third quarter of 2024. The increase from the third quarter is attributable to higher advertising revenue and subscription revenue.
Cost of services decreased to $34.5 million for the quarter compared to $39.5 million in the fourth quarter of 2023. The primarily due to a reduction in programming and content costs of $5.3 million offset by an increase of $0.3 million in other cost of services, including payment processing fees and costs paid to publishers.
For the full year, cost of services decreased by $7.7 million to $138.5 million, primarily due to a reduction in programming and content costs of $9.5 million, offset by an increase of $1.8 million in other cost of services, including payment processing fees and costs paid to publishers.
You will see in our financial statements and net loss for the fourth quarter of $236.8 million, which compares to a net loss of $29.3 million in the fourth quarter of 2023. Included in the net loss for this quarter was $184.7 million in the change in fair value of derivative expense, which is related to the Tether strategic investment.
Adjusted EBITDA for the fourth quarter of 2024 was $13.4 million, a 55% improvement compared to a loss of $30 million in the fourth quarter of 2023. For the full year of 2024, adjusted EBITDA loss was $92.1 million compared to a loss of $115.3 million in 2023.
As we ramp up monetization and maintain discipline around our cost structure, we continue to expect to move materially towards adjusted EBITDA breakeven in 2025. As Chris stated, this remains the goal today. However, with the recently closed capital infusion from Tether, we have the increased flexibility to further invest in initiatives that could accelerate and expand our business sooner than originally anticipated.
Moving to our cash position. We ended the year with approximately $114 million in cash, cash equivalents and reputable securities compared to $132 million as of September 30, 2024. This does not include the $250 million in gross proceeds to the company upon closing of the Tether transaction on February 7, 2025.
During the fourth quarter, we will once again see an improvement in cash, cash equivalents and marketable securities usage, which has improved in each of the last fvie quarters. For the fourth quarter, our cash usage was $18 million, representing 19% less usage compared to the third quarter.
As it relates to the first quarter of 2025, given the timing of our call today relative to the end of the first quarter, I wanted to provide some color on our top line expectations. For the first quarter, we expect revenue growth of at least 25% compared to the first quarter of 2024.
Lastly, in the earnings release, we have provided two capitalization tables for reference, showing our fully diluted share count as of December 31, 2024, pre Tether completion. And as of March 12, 2025, after the Tether completion was completed after the Tether transaction was complete. That concludes my prepared remarks. I will now turn the call over to the operator to open up the line for questions.
Operator
(Operator Instructions)
Thomas Forte, Maxim Group.
Thomas Forte
Great. Thanks. So I'm going to ask one question, one follow-up and I'll get back in the queue to potentially ask more. So first off, Chris, congrats on a tremendous quarter and year. The first question I had was, how should we think about the impact on your monthly active users and other engagement metrics from Dan Bongino, being named FBI Deputy Director. And then second part on this one, are there are influencers on your platform that may take roles to the administration that may negatively impact our ability to provide content and Rumble?
Chris Pavlovski
Hi, Tom, thanks for the question. With respect to the second part of that question, I'm not aware of any other current content creators that may take on roles. Obviously, that could change at any moment's notice. But I'm unaware of anything.
With respect to Dan Bongino, becoming the Deputy Director, what we did in the last couple of weeks, and we announced on last Monday is that we launched something called the Rumble lineup. And we introduced the technology called the rate feature that allows one stream to follow another stream. And we've seen enormous success on this as of last week.
Dan Bongino's last show, I believe, was March 14 or around there. And when we launched the lineup, we had Vince come in and take over Dan Bongino's show on his channel. And then we had Steven Crowder moved to 11:00 slot and [Tim Poole] move to the noon slot. And what we've seen is starting from 9:00 AM, we were dominating number 1 in the live streaming space states at 10 AM as well with Vince. And then 11:00 AM, crowder really took on the largest part of that audience. And Tim Poole continued holding number 1 at the noon slot. And we're kind of seeing that throughout the entire week last week.
So we think the transition there has been incredible to say the least and potentially leading us to a bigger opportunity here with expanding that lineup throughout the entire day and into prime time to compete against network TV. So we're really excited about that.
Obviously, losing Dan is a huge loss, but we think we have filled the gap very well. And Stephen Crowder has definitely stepped up to take on a large part of that audience along with Vince. And then obviously, adding Tim Poole to our lineup helped a lot as well. So we're not seeing any kind of significant change. If anything, what we're seeing is this audience is sticking on a little longer and now watching other shows as well. So we're really happy with what we're seeing in the first week.
Thomas Forte
Good. That's very encouraging. So then my second question, and then I'll get back in the queue for more. So earlier this month, you announced Bitcoin treasury purchases for those investors who may not be familiar, what's the strategy?
Chris Pavlovski
Yes. So we announced a while ago, I think it was back in November or December that we're going to be adopting a Bitcoin treasury strategy of up to $20 million in Bitcoin purchases. Up until this point, we've invested around $17.1 million into Bitcoin. And it's -- the strategy behind that is, obviously, I've been very, very pro Bitcoin my entire life. The Trump -- when the Trump administration came into office, this was an obvious thing for us to do.
We -- I felt very strongly that we needed to have a position in this, not just in holding cash, but also holding in Bitcoin. And we're -- from what I can see, we're one of the top 50 company holding Bitcoin now with our [$17.1 million] top public companies, I should say that I'm aware of that's holding.
So our strategy here is to make sure that we're aligned with the community that's very enthusiastic in using our product and showing that we really believe and what they believe in. And we see this as a really good investment for this company for the long term.
Thomas Forte
Great. Thank you. I appreciate that. I'll get back in the queue.
Operator
Jason Helfstein, Oppenheimer & Company.
Jason Helftsein
Thanks. So several questions. So first, let's start off with the kind of the Bitcoin or Rumble wallet, I guess, who is going to be kind of doing the development of that? Is that Tether going to be bearing the cost of that? Are you going to be bearing the cost of that? Just is that something way to kind of factor in? That's question one. We'll just -- I'll tick them off one at a time.
Chris Pavlovski
Thanks, Jason. Yes. So Tether is helping with us on that, and they're bearing their own cost on that side and helping us build that. We also are bearing a cost on our side for the implementation of it. But the development is in unison with the Tether teams, and there is no additional cost or any material impact cost on building that, that you'll see. So it's basically both teams kind of working on their ends of that -- of the Rumble wallet.
Jason Helftsein
Got it. And then just like at a high level, I mean, obviously, Tether has their own reasons for making this investment. I mean, I guess, it sounds like some of this potentially will aid demand for Rumble Cloud. Obviously, you've got this kind of rumble wallet. I guess just are there other strategic rationale that Tether has, I don't know, perhaps either publicly said or you're aware of a kind of why they've made this investment from a strategic standpoint?
Chris Pavlovski
Yes. So strategically speaking, one of the big strategies around the rumble wallet is to allow us to go to the international markets and right now, in terms of having advertisers in international markets, it's very difficult for us. We're very focused in the United States and Canada. But let's just take El Savador as an example. We'll have the rumble wallet available when it's done, and we can now enter the market like El Savador and then we can have whether it's a crypto exchange, whether it's Tether they can all come in and help advertise that product with influencers that we have in the El Savador and market.
So the way we see that is it's a real great growth opportunity to grow in an international market and have big advertisers like Tether come in and help promote the Rumble Wallet product, which would carry USDT and Tether gold along with Bitcoin. So this is a real large strategic here with Rumble wallet to go very international and tapping into those 400 million Tether users that they have.
On the cloud side, they have a lot of portfolio companies that we can tap into and move over to the Rumble Cloud. Those are longer-term plays that take long to onboard but that's something that's very strategic. They have a lot of portfolio companies. There's revenue there for us to bring in on the cloud side and utilize and that's something that we're aggressively approaching to.
So both on the international expansion and bring the ability for people to tip and pay and creators to get paid and tether around the world is a huge strategic point for them. And obviously, on the cloud is a huge strategic point for them.
Jason Helftsein
And then just lastly, on the fundamental side. So in the fourth quarter, we obviously feel better engagement as it relates to US or UK and MAU and a nice uptick sequentially in monetization. How can maybe bridge it, how are you thinking about that with respect to the first quarter guide kind of branded between the mix between engagement and monetization to get to that first quarter guide? And kind of are you assuming any natural falloff post the election. Thank you.
Chris Pavlovski
Yes. So with respect to the MAUs, what we -- what I can say is in the first quarter, being that we're nearly closing out the first quarter here. We have stuck the MAUs in the first quarter better than we have after any other like election cycle. So as you've probably seen historically, in the midterm elections, we had a massive drop post the midterm elections in the first quarter from the fourth quarter. We're not going to see that type of massive drop here in -- after the US presidential election. It's going to be a much tighter range than was than the midterm elections.
And that's attributable to the product just being dramatically improved over the last year. We're sticking users better than we ever have, and we're growing in different segments of the market, not just politics. So that's something that I think you're going to -- the market will see is that we're going to see a tighter range compared to the ranges of drops that we saw from the previous midterm elections.
Jason Helftsein
Great. Thank you.
Chris Pavlovski
Thanks, Jason.
Operator
Thomas Forte, Maxim Group.
Thomas Forte
Great. Thanks. Thanks for taking my follow up. So having asked this type of question in a while, I think it's important. How are you able to get Dr. disrespect and the White House to join the platform? What is it about the platform today that makes it more attractive to content providers than in the past? And at a high level, are you able to add content with more favorable gross margins than in the past?
Chris Pavlovski
So I'll attack the last question there first. With respect to the margins on the content, what's very different now than what was available a year ago or two years ago is that our entire product suite is now available from rumble premium to RAC to the sponsorships in both premium and RAC really kind of dovetail into each other to help drive higher margins around the creators.
We didn't have this a year ago or two years ago, and we didn't realize the impact that would actually have on the margins. And we believe that going forward now that we have these three, it puts us in a place where we're, in my opinion, one of the best places to monetize on the creator economy. And I think we're going to really like -- we're definitely going to be stepping on the gas pedal here and bringing on more creators to push the envelope here, especially with this revenue engine that we do have.
Now going with respect to your other questions, the White House, one thing that is definitely true is that Rumble is the lead in the independent creator space for streaming in the political sphere. The White House knows that. The -- we dominated the election cycle, and we continue to dominate every almost every morning last week, we were number 1 at 9, number 1 at 10, number 1 at 11, number 1 at noon in the United States.
So the White House definitely sees that, and they've definitely rewarded us with bringing their channel onto the platform, so we couldn't be happier about that. I obviously believe that we should have been with the previous administration and had the White house channel then as well, we were a dominant force then but it's really nice to be recognized by the current administration, how dominant we are in that political news space with respect to content creators. There's just nobody that has that type of influence that Rumble does in the Internet sphere.
With respect to doctor disrespect, we're really making a push into gaming. We've also launched a new creator program here in the first quarter that was showing us tremendous early results. And we are very -- we're going to be very ambitious in growing this program, and we think this program is here to stay for the long term. and we're going to be investing very heavily into that going forward because what we're noticing is that it's driving results with respect to the most trap of having both sponsorships, premium and RAC.
It's really driving results a little better -- a lot better than what we were anticipating. So we're going to step on the gas pedal in gaming and really push a lot harder through our creator program that would be open and available to all creators.
And this is kind of our pivot away from the whole contract, MG contract things that we do. and kind of moved to a very open program that everyone can join and generates both the higher venues for the creators and high revenues for Rumble. So we're really going to lean into that in the future.
Obviously, if there's a real big opportunity like we had with Tim pool, we'll definitely look at that. But we're going to -- we're a lot more conscious. We really understand our numbers, we really understand the data now. We know what works, and we know what doesn't. And we're really going to lean in on this creator program that we know is working currently.
Thomas Forte
Great. So last one, high level. So Chris, as a long-time follower of the company in stock. You saw more confidence in me about the business than you have in the past. What gives you that confidence? And then, for example, I think you had high expectations heading into '24 because of the US presidential election, but you actually found even much better after the election. Can you highlight why you feel that way?
Chris Pavlovski
Thanks, Tom. Having a partner like Tether is obviously a big confidence booster there an enormous company, the most profitable company per employee that I'm aware of and one of the most profitable companies out there. And having them back rumble obviously instills confidence into this company in a way that we haven't seen in someone come in, in the past. So that's very helpful. We obviously had -- we had a really great election cycle.
And the results were -- I think are going to be very positive to the Rumble business. I think the advertisers are going to open up. And I think that right now, the line in the sand for this business is direct response. We already have that. The macro economy is not going to really have an impact on direct response, but we have enormous headroom to grow with brands.
Like it's -- we're basically 0 right now. If brands start coming in, then that moves the headroom up a lot and drives our revenue up pretty materially. So I see like a lot of optimism around there, a lot of optimized optimism around the fact that Tether is coming in and they're very ambitious about us growing internationally. And utilizing their current user base to really grow Rumble internationally, and they obviously have the balance sheet to advertise and that balance sheet to really lead in on rumble, however they want to lean in on it. But most importantly, one of the things that we're very aligned on with the other guys is that we want to take on Google head on.
And I've always wanted to do that. We've taken a chip out of YouTube. I think there's a real opportunity for us to really do something big on the cloud side. They think that as well. And in terms of even furthering that ecosystem, we're equally excited about adding even more products to the Rumble to the ruble product line, not just cloud, not just rack, not just the video, but really looking into e-mail, really looking into these other products that were we think that our audience, both rumbles and tapping into tethers audience is really -- would be very they very much would want something like that.
So we're exploring that right now. That's something we're thinking about all these different ideas and all these different approaches. It's very consistent with the mission that we've had and how we wanted to take on Google in the past. The difference now is that we have someone like Tether behind us that really believes in that and has stepped up to come and help us with that. So like you've noticed, I'm very optimistic, and I'm really looking forward to the coming year.
Thomas Forte
Excellent. Very, very encouraging, and excellent. Thank you.
Operator
Thank you. Ladies and gentlemen, it appears we have reached the end of our question and answer session. Thank you for attending. You may now disconnect your lines.
