CURI - Earnings call transcript Q4 2020

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Operator

Ladies and gentlemen, thank you for standing by and welcome the CuriosityStream Q4 Earnings Call. At this time, all participants are in a listen-only mode. After the speakers’, there will be a question-and-answer session. [Operator Instructions] Please be advised that today’s conference is being recorded. [Operator Instructions] I would now like to hand the conference over your speaker today, Denise Garcia, Investor Relations. you. Thank ma’am. ahead, go Please

Denise Garcia

Jason David. Welcome and discussion its quarter Officer; discussion are Financial to year XXXX CuriosityStream’s and Executive full Chief the Stinchcomb, of CuriosityStream’s financial Chief Clint Officer. fourth CuriosityStream’s Thanks Eustace, results. today Leading

prepared be happy remarks, But your to statement. harbor will the review I’ll safe we management’s take questions. Following first,

guarantees but securities During are forward-looking that are this our laws. statements a risks, to These business variety call, performance, we uncertainties related may of are to subject and not under rather make federal future statements of statements assumptions.

results materially views or additional statements, nor forward-looking could statements Our no and reflected forward-looking actual any Please update these statements current management’s undertakes differ revise only, in statements. any to make forward-looking future. reflect that to the expectations the aware in be Company from obligation

risks and the discussed to please important discussion the website SEC in filings material that a other release. SEC website Relations today’s risks results, our and For actual and affect factors refer well important as could on Investor other as our the our on press of factors available

Additional ended will XX, the on for Form when also year annual forth be XX-K our information in filed. report XXXX, December set

will made reference non-GAAP financial measures. addition, In be to

over Clint. I’ll turn Now, the call to

Clint Stinchcomb

Jason’s Cudahy; is entertainment provide Eustace, At CuriosityStream’s Jason Thank quarter turn us call my open Strategy, with over After today, our you, call for and inspires. CFO, enchants the everyone call. review, to of Officer that Content to Denise. CFO, mission fourth Eustace; delighted up will the I’d General Emery. and and questions. I the review Jason Chief factual will financials. for we to premium have Product our informs, Tia the Devin like comments, joining full Counsel, earnings our our close of to to and thank EVP and I’m Year our XXXX COO

content. on-demand and on pure-play favoring worldwide As emerging are trends we streaming capitalizing service, current a

Our and key and which of offering geographies success. multiple to robust content monetization focus with security multiple advantages. engaging longevity has several on across content, with appeal competitive our content avenues key differentiated is us our and demographics our And business and model provides factual

I’m our a we that about record year success end the talk report in quarter. and XXXX. me pleased to to Let had fourth

revenue annual sponsorship Our XXXX our year-end than our than in success and with annual times the to driven XXXX in strength continued our revenue revenue. fourth million, in also Revenue more XX% contributing was grew double XXXX direct X quarter to subscription and the sales revenue quarter. $XX.X by program year-over-year more

produced team I’ll pandemic what while subscribers Our XX% these quarter. I On couldn’t with be of the accomplished. on results continued million, approximately XX in strength milestones to through basis, with also year. plans the subscribers start grew fourth prouder a subscribers. a annual year-over-year several international crossing paying during we’ve and

to our couple content to increase up with subscribers. starting about continue each details these partnerships in of growth highlights, We worldwide. our results. these I’ll build more distribution A contributed share factors of library and

But for improvements churn that implemented year-over-year. XX% more we we time turn attribute which active and to new high First, throughout can churn We most QX continue is subscribers, implement. and decrease this produce by that marketing, than the this already typically our a rate. churn monthly our to we product content in low reduced year, in year

and to keeping and results. of tactics mix targeted cost-efficient at acquisition marketing efforts Our direct also awareness, aimed customer investments our response contributed

agile we subscriber North our business of both marketing Star XX%, our efficiency demonstrates This the to continually count year-over-year. the increased by LTV direct fourth total and our increased overall subscribers. to and impact our employ. of budget optimize and continue XXX% metrics, while Compared by revenue focused nearly paying decreasing strategy the end marketing we XXXX, XXXX, at We to the quarter our

relevant deliver content. new continue through unique, and We perspectives current groundbreaking to

by original BEYOND help ENGINEERING we narrated mega the And original wind, THE reveals channeling personal at era Leonardo aviation SPOTLIGHT, Landmark DiCaprio series celebrities Samuel which the machines, executive by world. Shaquille Jackson and like passions new premiered the green produced THE focused quarter, and Kristen which how renowned the FUTURE, on Bell, of fusion. and and Way, Appian During team explores his franchise like O’Neal, the their to are Patrick the Stewart, change

the our XXXX companion which During to The the for run-up but election which the Fighting series the America’s delivered movement key the Lincoln: and of civil that many Abraham reveals explores forgotten the believe premiered election mid-form cycle, sparked powerful war. the three-part special that we Wide long Lincoln, events presidency, also Lincoln Awakes, paramilitary Electing in

We’ll We the also of most and The others. many more about Sinaloa, weeks the new original for of coming XXXX, History yet months. franchises largest Goodall, of The the green with Chimpanzees Year of World, Congo projects The Rocked our lit, Street, ambitious notable Rescued Color, programming Wall that the make Royals including in our in program and like slate announcements Jane CEO and

invest distinct science, us. Nature, defines to that the travel in and genre. the every in history, continue content factual category We

our We more originals will than new in any this year see history. time

revenue in in brands especially it stories about increasing yet distribution viewers will telling space, they unrivaled that and factual wellness and financial to and content platforms, or others have an pay-TV already recognizing relates international health surprisingly, strategy via to as partnerships the goes which our Tata one of largely Not library an about our discover. is of we during the fourth than partnership already largest topics partners in distributed that with India’s in marketplace categories. from from and services acquisition distribution We grew operate. continue SVOD began the operators. brand Russian interest an Sky, entered to quarter and factual quarter, have care with and brand with the Also the Our premium partnerships sponsorship deeper the number subscribers expand the

trust developed to interested of we promise partnership content and to the CuriosityStream’s was it is As about right. sponsoring get a an wanted and perils they Blockchain, the team example, they story blockchain. and crypto Bitcoin own, one in

worked we brand their Their phenomenon COVID-XX. as global becoming in a of were connected has space, in with creating in in in a a experienced Another result interested fitness. business, that fitness. the They growth like many boom leader connected explores content is

by It So, paywall. CuriosityStream for well both front it of across audience, world evolution and in promoted has our very several of fitness created partner been the also the interrupted received this behind and platforms.

and Lake the of product on area We our a quality became to media stars. in direct-to-consumer area HISTORY notable CITY, secondary series an business. blue we in has invest our the Director revenue features of Okeechobee captions, libraries HOME, long-term to way, in us have plugged intend content. to produced The Pompeii increased programming XX holders. service more the We paying some to follow-on to of functionality offering, of focused $XXX South support Landmark narrated of enables and and in We Nick in distribution, the company banks customer allow with $XXX of first grew marketing. proceeds, responsibility every team special of subscribers additional Put the the of iconic during We approximately warrant improved experience and with us to launching in significant the the portrait strengthen to X-part factual another of the million we process streaming importance in NFL’s hires significantly international. This we base first through milestones We the DISASTER and traded and this I excavation of in than million series We Moving in for XX-minute $XX XX STREET, of chip More able quarter raising streaming our continue by million. MUCK FOREVER: exercises. leadership our Florida audience woodworker, quality without world. XXXX the emphasize of the redemption money. X-part content and recently, strong of business brand the and years. and on content quantity AND Parks enough one factual strength the strengthened better year. app, generated improving for linear few value can’t on-now through the crossed to POMPEII: approximately million discovery the improve community being the also within investor and by with search audio infrastructure Xth library we adding first the to tracks raising compelling finance. management significantly proactively multi-language our improving year completed of apps on Offerman. our renowned A exclusive OF included initiative development the partnerships, the focus of that gap Epic U.S. October, institutional And and on Parks, in international which largest And access and running experience. area highlights featuring our XXXX, distribution, Recreation’s biggest publicly third-party record

balance XXXX off Jason achieve to and and And target we a a leading I’d our of sheet, to the our strong CFO, over We are XX%, fortress goal turn revenue engineer now strength, library to track over a talented committed, sheet for our XX% balance like start to year-end architect on strong revenue as the position XXXX. presentation than our content Eustace. and of more we’re streaming. entering factual in have of year-end

Jason Eustace

Clint. also strength XXXX excited I’m and Thanks, about XXXX entering our our accomplishments.

and Before as have to that fourth -- our quarter as in I’ll statements release. unaudited the year press of well for in the included our today’s I XXXX financial quarter we our net reconciliation fourth full fourth loss review operations EBITDA note financials, the of

will week. XX-K be next our which filing, filing we’ll financials audited Our in be included

quarter financials. review let’s Now, fourth

XX% and from QX This to XXXX subscription million, CuriosityStream’s by was distribution million up So, in led XXXX. direct-to-consumer grew QX revenues revenue. $XX.X $X.X

timing revenue new titles We of of XXXX, number revenue released $X.X in and Cost QX the compared in increase year. result to of of same and with compared sponsorship content of continue million to primarily XX% contributions a or of lines year-over-year as the was the the to from prior our quarter in increase of amortization to revenue XXXX due QX XX% all advertising. an revenue

expenses increase compared QX compared was $XX.X Advertising a million, XX% XX% compared as expenses year-over-year sequential approximately from $XX XX, at of million QX XXXX. $XX XXXX, the million received last overall and a XXXX an we cash the million and and $X quarter of of to the loss in to result, quarter $XX.X XX% CuriosityStream’s offering EBITDA million, an And closing EBITDA On million on gross year, As marketing quarter. remained million. ending million balances $XX.X of combination relatively operating fourth compared last with totaled at margin Software Group, of of end we to investment to of XXXX. in was October noted $XX.X XXth, with business decrease additional this of CuriosityStream’s million fourth Fourth million. increased year. $XXX closed of a more our of at about public loss recently, Acquisition in December $XX.X February a approximately we the $XX.X XXXX. quarter XX% flat

track deliver We with million with revenue, are consistent for our the our XXXX disclosure is $XX to combination. plans which during on in business

our and on is our visibility at XXXX XX% good revenue committed have revenue goal this of over point. We

of up David We questions. over And of second turn the business quarters sponsorships back I’ll to now, program ramp half outsized for year. as lines to create line our lumpy an and open sales such new expect some it and as the

Operator

the [Operator Instructions] with question Dan line comes Benchmark from The of Our first Company. Kurnos

Your open. line is

Dan Kurnos

on the an about Good And about DTC DTC guys of year the puts you driving Obviously, X Maybe year, of side. people finished strong. sub on and don’t uptake domestic just million trends. Obviously, that have the that some maybe are a Thanks. balance got kind the evening, stimulus, on think talking pricing. takes. of slot. in of you the of if you just the guys especially us help know Great. about There’s lot and talk -- guys. annual the I sort

you where terms that of on So, of that the how some of of think year. you that, to half targets, reopening about But, the the you how do And maybe the goes? upside kind will impacts corporate you bucket? the way in in consider Thanks. the either progress kind think that side, that if benefits back of counterbalance mitigate or will,

Clint Stinchcomb

to Thank yield then you, Jason. it take Dan. and I’ll

third-party I businesses. a real especially it are for our relates us, positive think, trends the to opening as

Miami, we what As you -- do of don’t see in And we this our mentioned, service But, we the we’ve see I -- this with up L.A. where to opening I’m had Florida do seen I’m was great community that up. on direct year. in South tell opening next based way big course last more see so down. then there. I’m growth what my opportunity year, world over can slowing media I a far we is where week week, later the is mean, to you, personally, headed and out

of I that our positive able with community people our will it trend open general relates things there. positive being us. just That’s So, more up story as And to only think, down only partners. third-party be and that sit to as more share and internationally, for

impact that’s and as excellent our an us, direct we’re it’ll a So, only business on well. trend positive for that optimistic have

Jason Eustace

that of The into on growth It’s out saw is that fourth side we the only third into our first continued and to continuing part there strong see thing that quarter then direct growth add business. I’d continue continuing quarter, of we XXXX. coming of the

nothing’s changed. So, really

even has not up, profile impacted business. the with economic overall things it our so, And larger negatively opening changing,

Dan Kurnos

Great. stimulus some Maybe with and on program of coming through. advertising, still then, tailwinds money see it you’ll some just sales the makes I sense. the know And

kind of half back about phenomenon. year talked of the the You

go-to-market you’re again -- sort it’s should is this. demand of obviously and for big there’s you guys demand the and ramps stimulus are I having, play Just on. role out. to But goes kind of the know some huge there’s going big your year clearly in maybe how a a content, for obviously developing the of probably And conversations play that advertising as a this

you you give color Thank be see on the helpful. incremental shaping that over up how can would any year just you. So,

Clint Stinchcomb

Yes.

say at lot he of Time all for Emery’s our year, vision to majority think that of a conversations a that last On hired And since the would partnerships begin brand for he’s Stamos executes and his bear from how kind had, Inc. side, great we I spent maximize brand Devin a we what leader will of he partnerships. meetings sold as started. of business feed I Nate the career And lot those of on brand he’s fruit is --

us through And sales going see it that heartburn One thing the definitely the is But, nice in because that down content going engage to it continue parts our also enabled we then, factual where gives of the business is, cause ways. it X can to we for has right of of hit fact lot we is other or So, some the two visibility presales X to that production. of be And to business the into constructs, pandemic. as XX world to revenue to program which that about any we’re modest to conduct programming a then, in relates to not us months in sales, the just the through produce promotional growing. us nature library space line businesses.

most of of We the issues haven’t companies that have. the any are had the issues that nearly scripted

-- the long working as excited we’ve the about well. So, companies some us partners with term meaningful media great are there, who got over

Operator

Needham. Martin of question next from Laura line comes with the Your

open. Your line is

Laura Martin

you guys? Hi, Can me okay, there. hear

Clint Stinchcomb

Laura. Perfectly,

Laura Martin

Great.

So, by that was international. growth you driven said sub

revenue to contribution? So, of I’m when it revenue you growing, that? And what the for gave terms year, percent projection percent total give us same can in was us as a the you of the curious is that as in or size, a staying international international component Is of next QX?

Clint Stinchcomb

direct international So, U.S. grew came from of direct bundle -- our the Majority of so international. subscribers a subscribers Majority business our lot. obviously, came our from

to year-over-year. year-over-year sure. -- international you revenue are we but so, international subscribers on And trend basis And for X outside can subscribers today time, grew points see I internationally. yes, growing in you -- by is mean, of our tell direct slight that U.S., on tell I And a that I of what can U.S., our the -- our majority subscribers what the a that’s dominated revenue bundled over majority -- are the be and our

Laura Martin

your library is about XX% and is recollection licensed. you are my by then, XX% owned then And cool. of Okay, XXX%, hours

look given shift those any the expect QX? in that QX stable content And next planning do that -- you for to was of numbers creation year, were out when XXXX? So, aggressive numbers your to you

Clint Stinchcomb

mix, and we do relationships time, world and and the can that’s better we’ll like continue At rate, have a around deals. see really great efficient and We the to for same content more as palatable excellent a of lot available that originals. lot of broader great we acquisitions we that of acquire part sometimes

same. mix the that anticipate we So, about to stay

Laura Martin

deals, are deals? long And are those five-year also, they how

Clint Stinchcomb

three then to comes five-year deals, to acquisitions, it typically.

Operator

Research. Your the Goss of comes from Jim next question with Barrington line

is open. Your line

Jim Goss

Thanks.

And are developed, they You think bundled unique I’m to you’ve mentioned you you wondering do use et such POMPEII. in program build and couple focus which areas and programming subscribers, this key the in relative DTC as to and programming a cetera? to sales, areas of planning would how

Clint Stinchcomb

is, to content look answer monetize that relates to to the speak as across multiple a of direct businesses. have great business. Jim. Devin going monetization I’m question short asked, The you And it’s more think, platforms as it a to I the we’re it bit But, in business, little we

Devin Emery

Yes.

the a our So, of So, we’re pole programs our tent we’re specifically is, programs. and for out people marketing, CuriosityStream then part overall to alongside drive tent pole goes program kind that there is is right use in right? what what able people telling to for marketing conceptual key of these

across channels, tent people sign where poles and our all that with you’ll see some our on stay up and us drop specifically of then can So promote and we to -- also on us you’ll platforms then that us. them of promote get see into directly

CuriosityStream then, terms marketing that that other like use what our the and we’re and specific tent tends full able of our POMPEII we do. to value the marketing get great the that I HOME in of for So, say library platforms. on of be what we more of are, you targeted And HISTORY OF would concept majority is, the to focused the interest poles

Jim Goss

know trying distribution the you’re mentioned to that that to those the processes visibility? Are I programming attract visibility. to? from you looking are some where that this unique aside you might and the occurred. How the fitness, bundled do of and to you well? create all there connected using of subscriptions with there And, certain that promote ways can But, build corporate educational attention at say can and are attention, you’re on you also And think profile take tie content this you’re into blockchain higher that you things areas interesting, very I think a as especially drawing that these

Devin Emery

Yes.

So, point. we And yes, good that’s doing that. a are

of that. lot example HISTORY People like they we for to specifically use in. he that It him, opportunity we really to OF show Nick that has that And a good with is of Offerman, show. use the Offerman love, Nick everything a So, did a great attached right? So, what HOME, had market really like made he’s to right?

we’re of the right? So, use people, group to voice heard you that on So, that radio. hit his able to

You as slots television well as on social. saw heard him him and

able strength when we leverage like that shows to are show-specific have are involved campaigns and So, create we and yes, programming. that have the more the to that, leverage do talent the which of of, we more able

second doing We’ll and do that. part? we’re that. to So, do you take more the to want of continue absolutely more Clint,

Clint Stinchcomb

it. the Dave some dock scope give But, mean, we’re Well, a also a have I just year marketing sense resources we of [ph] scale to behind projects working I to this actually on. you premier the of wants that it -- and we we’ll that of would feature put there, say

business. reliant the reliant obviously, positive and if on only that will not we that So, But a impact resonates we’re more guys, recognize, can hit cultural bigger or business. have content we hit a find service

Jim Goss

of at void And the look a changes windows, maybe create Maybe last base. on way is could you’re some that quality? this Okay. content of end theatrically, creating the off smaller filling role you the blockbusters, creating a focus which the creating exhibitors release play Do studios void you there’s high one theatrical it’s some of could that one. and the in But, And that could with film any on we releases. you’re very since especially also. in in think

Clint Stinchcomb

business able that. come quality answer the we have And case to the think do I be what down the is to to it there. would is

Operator

the [Operator Instructions] Your of from line Logan with next question comes Thomas Stifel.

open. Your line is

Logan Thomas

just months, and these just related relating the is and particularly about revenue how talk and XX that to investors that’d prioritizing how the across streams all to over pace -- investments streams, areas? monetization aggressive of multiple the question go investing pace First the areas about investments how to think you’re want next that thinking growth about just of should you be up frame to for helpful after these you multiple

Clint Stinchcomb

direct And And allocate great question. great a continue it to continue service. and meaningful we we are to we marketing really at that resources if grow supremely level. It’s that with see more Yes. I confident promotional think that, we to growth our can a

makes And that conversations whether it put sense or Board with the of our -- that in now. plan really operating under it we’re the so, we’re makes there, on not sense I to or about gas kind the right beyond foot think not whether always

the we’re also spend we more relates marketing to focused is So, on And -- bit on we love target. to and we money price we have our grow elasticity, to we’re that. side answer yes. business? think The a that potentially that. mean, some promotional I supremely confident in have little obviously because as it Would hitting year-end direct

that -- at something it’s continually we just So, view. continually look and it’s

Logan Thomas

of the in annual with run there agreements Are kind chunky should about of be that the current spoke program, That question, I to in just I Jason committed in if think life this any distributors, order you XX% level from active to -- the bit. XX% And up, just But committed. from a tie there think about one makes the sales. XX% committed to sort direct it thinking rate? as it, coming Okay. sense. And on investors subscribers, other items to we spoke bridge other can, that

Jason Eustace

Yes.

do have and to quarter-to-quarter the one of I create program take brand that the of into to little bit cadence. have going a is that of of lines kind revenue you we thing is sales which newer side, think, kind kind consideration a with two of lumpy more that the sponsorship

So, after as the or quarters -- and sequential you’re can well next those one of be because have have deals to the going quite just some some after the that be. down sponsorships some potentially swings can program sales can substantial big brand of

we so, definitely $XX And as of of we’ll more business, a business. run We our we’ll direct like have we those million. rate the -- hit a within greater of But, visibility, to business that recurring side. articulated the But, on certain mature, lines those distribution on go partner the direct, the lines the definitely well. get committed. of full you get of Certain remains year have there as numbers XX% direct, top on line the do still contracts are like of

Operator

D.A. with from Tom Forte of next the comes question line Davidson. Your

is open. line Your

Tom Forte

and follow-up. question. And question taking Thanks my had one quarter. on Great. congrats the for I one

So question you basically talked is, the first the reopening of everything. about

So, extent, was COVID, at if to was what and do things impacted, by it today? impact your if negatively production all, stand where

Clint Stinchcomb

The and through COVID. right we produced premiered good that through COVID news, is new programming right we Tom,

Now, certain creative you need a cases. get to little in

with did camera the a doing bit. some so, compared as in little crew. them pacing interviews we Zoom to the some of We extended comfortable, person And sitting over that the in, as people productions weren’t were

certain we in a I got efficient that cases. more even so, say little And bit we learned lot. would a And

factual Does again, the go deliver. deliver that, around it’s according the better. Tom? that we’re would -- answer that of light production the light that schedules plan pockets That there have are I we’re the that will we’re question, say bit we a few difficult. to where flexibility forward, times so, space, only And in space and going it’s still in will internationally, getting few that confident and in that anticipating places your not around of But, on everything to continue and fact working a the said, scripted little we’re all

Tom Forte

knew wasn’t It of things you some nature in on you and what I that to advantages that as does. I extent still far that just had you weren’t were numbers as favor. work large dependent actors our of disrupted. sure

Okay.

So, services you the video-on-demand had second more that’s was on subscription come any think question online, hybrid subscription at do all advertising video-on-demand impact as video-on-demand, or your I had viewership?

Clint Stinchcomb

content of AVOD like to we’re on kinds running watch platforms. all every Yes. race. you I more platforms. I feel these mean, own day, our there’s mentioned I mean,

If But, you it own to lot are on of partners platforms, a and programming kind deep whether platforms, there’s into the look or some money. the and is doing the making or AVOD Fox that the lot Samsung, And certainly of that’s they’re SaaS or of companies Viacom, whomever, services well a not there. the content hash as of those watched getting just that rating. marks relates AVOD

kind trend. of of to That’s be I produced. just nature the the -- the mean, So, for always that’s more us, we that’s going content there’s really, business.

our And is going we maintaining why out factual everything own do continue premium on that’s execute work focused we on leading We brand so, And well. plan content position we a have, provider. we’re as that. feel the run the that and rates to like to

Tom Forte

I ask want If time, to more one have Great. I question.

content So, anecdotally, the lot I’ve on of a enjoyed platform. the

It You talked the you excellent. about Lincoln material was had.

You have represents viewership a individual is one enjoy. that cats title great of titles dominant my Is stuff on case of no the viewership? big that meaning your still a or spread out, it portion widely handful children your

Devin Emery

correct. That’s

content the then, individualized use to percentage so, overall do ways, we that a able is it right? and also product right? and product of in market. to perspective as what is different broad, easy kind are it people is ways, example of being So, be And cohorts widely adjust it products what different make as But, from we our easier use to we very of find focused by well, loved. use in way as So, a an it widely can own in their here, different this very we accessible, large very on Our can capture people CuriosityKIDS.

feel the household. it so and So, different with look kids their can parents even are, are if using in our that programming product, different than same make slightly interacts we

So demographics do question, based to very can we each it’s engage to our exactly But still continually answer your different platform. on on more yes, and that broad displaying behavior they’re more base. the

Operator

conference you participating. concludes and Thank Ladies gentlemen, today’s for this call.

You may now disconnect.

CuriosityStream (CURI) 24 Mar 212020 Q4 Earnings call transcript