CURI - Earnings call transcript Q3 2021

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day, and thank you for standing by. Welcome to the CuriosityStream Q3 Earnings Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference call is being recorded. you. Thank like Garcia, conference Investor now speaker to hand Denise today, Relations. to would over the your I Please go ahead.

Denise Garcia

the Clint Thanks Josh. and quarter Leading third discussion Jason of today Hi, and Financial welcome XXXX to Eustace, CuriosityStream's financial Officer. Executive CuriosityStream's Chief Stinchcomb, CuriosityStream's Chief its discussion Officer; are results.

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

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

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

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

also the when report our forth set Form XX-Q XX, on for will in filed. information three Additional September be ended months quarterly XXXX

In of our on website addition, financial these non-GAAP GAAP reference reconciliation can will be found at be measures. non-GAAP comparable A made to measures measures to investors.curiostystream.com.

Now I'll call Clint. the turn to over

Clint Stinchcomb

the the close over know turn to call more. I'll entertainment for CFO, is At Strategy, Jason global, people Curiosity today for COO up we Eustace; factual CFO, the like want Emery. Product brand everyone of delighted XXXX the to joining comments, financials. our the who I'd will Eustace Tia to have call. Denise. of and thank Counsel, EVP Chief our open for Cudahy; and to our third to remarks, my you us questions. Content After Officer our I'm Devin Thank and call Jason earnings General with our Jason's quarter review

as have of continues Our genre opportunistic our acquire flagship service acquisition, light a X,XXX subscription up to across deliver ago. is and now distribute ownership our Not and video-on-demand company of license continue creation marketplace content every service growth category. a revenue to traction compelling content all we the In we titles under factual more deliberate unique from as cylinders, than and our in we to approach produce stack. the gain year or subscription across multifaceted firing in X,XXX but balanced only

quarter. XXX%. XXXX strong pleased Let revenue we're quarter more growth announce the another year, revenue our $XX of to is weeks of than guidance full committed. year-over-year year left about I'm million me to third in report delighted the XXX% with of talk With that slightly seven

midst in in our the leadership deliver these Our worst century our the resiliency of global a the in results factual category. pandemic ability to underscores the of business and entertainment

at personally nearly without reflects revenue XXXX CuriosityStream. Our talented been moment and thank assembled And we team the nearly for period, This number at hard-working achievement. exceedingly have would increase wouldn't over to a three-year eightfold truly a this their possible have I like commitment. eight-fold everyone remarkable a

licensing broad-based doubled direct-to-consumer by third our Our driven the businesses. strong gains more growth including in in revenue quarter, and than

been category. content. of providing and with the of objective factual Our has global appeal expertise success a the always and in of licensing strategy to range subscribers with flexible the CuriosityStream's our content broadest opportunistic creation and content entertainment the is in testament our factual best ultimate

objective. consistent acquisition including last Our business development our initiatives announced One University are with Nebula and Day of the in we recent investment this quarter

partnership our Nebula Nebula directly pole content our help while the rapid accelerate in company's growth platform, to shareholders creator on third world's direct XXX% is strength enabling position provide call. in on largest investment licensing the investment Nebula later revenue. enhanced and owned an participate the driven in in success. Revenue by will I'll in the subscription in grew revenue step-up the As continued strategic year-over-year its quarter to in in creator capitalize growth streaming and to anticipated more our the detail $XX.X million,

annual strong partnerships films revenue was fundamentals exceptionally Our The predict the delivered The of is to percentage subscribers have more during lower line as the innovative potential editorial events. a growth. of tier sequential unique subscriptions the growth. and lowest pricing a are growth this in growth. premium adopted enhancements XX% company's additional that first $X.X University's driven combined to to user. in quarter-over-quarter during by a consecutive Day in due increasingly We With driver few as XXXX per We our with difficult approximately in remained of see straight revenue direct-to-consumer accelerated ARPU our these business QX increase the such quarter of representing of revenue XX% we programs fourth tiering DTC great quarter thrilled subscribers reported year-over-year service a in become guidance growth improvement our topline we marking good we quarter. committed, million, average extensions, of One revenue basis reaffirm deploy second an to $XX direct-to-consumer and represents to quarter our with churn in quarterly standard we for offerings on million our significant XXth expect subscriber Three on history another increase ARPU the chose licensing QX is promotional and business driven plans. as third business make. a a quarter in could and and ARPU lectures example closed by expand service the XXX% of week subscribers our again which such over least DTC at year-over-year delivered With of XX% in

contracts us year sublicensed revert another third-parties to the retain on nearly travels territories markets direct-to-consumer factual term back period, demand ago. which content under contract. rights a and not the under allow agreements from And of establish was have economic value we quarter we nature we $XX,XXX well reflected to foreign to of to accounting. yet Our up content where of the capitalize under due in of presales Factual than after to expect in us highlight the a license of the contract significant licensing business internationally content, the offering. million, sales the we the largely to evergreen with agreements these significant presales The titles $X at end less is GAAP

revenue solid Our pipeline of presales of foundation in coming quarters. agreements and provides a the strong is

and including FuboTV partnerships channel for subscribers agreement quarter, curiosity multiyear to a service. During linear distribution our the with variety a stream we entered distribution VOD which number their through of access and into gained

our quarter, cutting-edge and premiere to Roman brutal of long series doc new the to acclaimed reaching and the surprising City, and orphan we in fortunes Civilization, collapse of links the the episodes the slate to of fruit. Secrets scientists Mars; Age three-part uncovered premiered our struggle gripping of their investing Breakthrough join struggling Becoming Egypt's of from by these series also of the Congo and up between multiple the XX-minute the several In We Enright we projects cusp timely wild. astonishing global During a turned we forces that of and Throughout highly Empire; trend of of more misfortunes three-part the of a rehabilitation science groundbreaking epic followed beginning access to unprecedented Michael profile of miniseries the Nose. chimpanzees our the in Kurdish and soldier over slate science everything tentpole to which years Heval, more the and and heavily to the planet's actor continued July, chronicle's Bronze Jane Secrets the including of Voyage last of That bear feature including quarter, ISIS are deliver to offer started Venus, to gave original about the filled humankind technology humanity's investments to premiered Lost originals. Rescued strong an our to real five-part year was Dogs to our growing with and journey defeat and the Chimpanzees Hollywood programming Goodall, tech who have successful and premiere climate the ever-changing Syria. Martin, return new

the only in and X us dishwasher, the always disposable for We large video human further barcode, our a marketing premiered our XXX,XXX XXX quarter Nebula's CGI well rapidly and to game-inspired the sponsorship accelerate market And launch The new show electricity investment a save long-standing episodes looking like which the additional Nebula time as boggling for and significant have discovery values This content less new we the landmark agreements will With Nebula be of Faster, attain tiniest accelerated entire largest run mind growth, new the and world's success how of investment series I'd to and people creator of why also the meaningful more turn two history category possible inception. four continue thrilled $XX extend the announce has new the to in our over have creative will the end everyday deal ways highlights. premiered for our to guidance with streaming years. Eustace Board opportunity in tools YouTube representation. active and the of $XX revenue we're are uses surface CFO, leadership humans like blowing having developed to Nebula paying to million ownership presentation place human scratched XXX enable highly last believe Season million. from strategy, inventions subscription our in we those audiences. success potential partnered Nebula on to to in Dave build We in and years. announce that The and visibility technology look the enhances continued of Butterfly quirky a more we original company. company. some have and Through of forward over that to irreverent Jason since physics. microwave and partnership, explores which subscribers investment financial invention year business of Nebula creators. company because another who opportunities to thrilled right growth of agreement to position focus have is full reenactments creators to history our authenticity more Nebula's help We engaging to through of the our with Nebula, lines affording platform now credibility right position while were share spectacular coming Wickes, than which quantum believe we and of cup, In collective some long-term will existence. financial the over standard. million, arrangement grown to product as the parent its the strategic summary, transformed factual and quarter growth Nebula's into in up the creators informative shareholders in of by and opportunity mind in a XXX% strategic We're and in to such course events Nebula subscribers platform. excess as than CEO the the on CuriosityStream share features, Effect, minority together repercussions try entertaining pleased were Nebula We landmark through of to the elaborate legitimacy Nebula's by strong commerce our

Jason Eustace

another now Thanks committed. Clint. $XX of excited with strong to fiscal announce our guidance quarter I'm million of revenue also XXXX XXX%

at Our subscription quarter during rates million nearly we strong and licensing of businesses grew $X the revenue. double-digit delivered

to are prudently we off shareholders' growth and in attractive capital. deploy paying opportunities continue to investments Our our find

by Now from The the XXXX XXX% was let's million, revenues and grew quarter increase $X.X QX, acquisition program XX% over million licensing QX review at sales $XX.X revenue of which direct-to-consumer stable customer led CuriosityStream's sales up costs. grew in third financials. to XXXX.

productions approximately 'XX. mid-December it's full expected production quality. pose our can uncommon to guidance That Advertising million quarter $X.X third a shift ability dates in annual the agreements presales million for timing during delivery that year mentioned, As $X to by Advertising production to exceed our in The week not million during potential agreements could to the included or we guidance. part of the delays were or revenue rather delivery than compared only X. limit expenses than Clint and and meet be of week had to guidance to in said, presales $X.X came our below marketing of provide difficult of at predict expected timing to quarter. guidance quarterly for later risk revenue we QX XXXX from marketing being fourth a quarter. impact to ordinary and course with dates final in close We recognized the film million $X.X budget the have first limit we no to constraints for

dollars to of XX% basis. into been the holiday we While or find when fourth XX of marketing marketing year-over-year and revenue $X.X in activity third was continue subscriber opportunity customer advertising portion season revenue reallocated time the quarter at invest XXXX, quarter budget the in to to expect quarter the of will percentage afford third our the to marketing of to has fourth of we opportunities us compared increase million a on we of during We during and drive attractive million QX in growth. as acquisition points our believe revenue a traditionally advertising an costs Cost quarter, a now $XX most active. invest XX%

As compared margin a was XX% in of QX to gross result XX% XXXX. QX

some on year deliveries QX gross gross relative and million lower now with agreements Due exceeded program margins to our expectations presales licensing full to slipping operating sales. overall presale within basis compared $XX.X While were mid-XXs. content QX to $XX.X in in into expenses mix year-over-year the million about of expect deals 'XX. margin we CuriosityStream's a of higher-than-expected due

company, loss the loss G&A million investment particularly technology million of in and a and to year higher product investment. capital EBITDA of to quarter Third human associated in an due was marketing with $X being last public $X.X costs EBITDA increased compared increased

Clint on are the deliver revenue plans open XXX% line the track million to We and to now XXXX $XX And for of with with I'll turn for committed. our back in up revenue it questions. over

Operator

[Operator Davidson. first with Forte comes Instructions] Your question from D.A. Tom

is Your open. line

Tom Forte

the at Disney into the lumpiness variants the the Great. versus the talked talked quarter, production, slowed how third you're about one and something have Delta you slowed the follow-up, talk COVID production. but by about you lot about COVID all can your production One falling about or speaking I generally the know, fourth or side, variants? if their and quarter question you Delta and on a variant, talked

Clint Stinchcomb

of who would Attenborough. content shot obviously Evolve, Thank for content And say COVID and best our you through that. with like the end out throughout nearly multiple of countries ever It's programming to Tom. of series a some great that believe the week. question, that, – I every original be year now a we coming that well. asking And David the And yes, Eiry, some on with premiered was next Patrick we and was multiple as continents our

our a programming something to quarter, our And we the it – Royals, fourth and we shooting. titles – of we – recognize content, always to in year series footage we I the to called third best editorial with there, we able we recently content term. as to going we'll an of been relates the that, quarter, on around as period. with one historical way long-term from of term create. so or We and series to might we're able why so quarter to able means comfort challenges now side side short quarter – navigate extraordinary demonstrates slip second recognize told never create which license is can navigate mentioned, a we're under we're of and through we're have the end think that quality, launched were guidance. annual to the is in But able focused. all, We And we're shares of it as not The we're that we've and delighted way weave maintain this intent through of have possible ever that. more a which if our had are But third on to than we volume today. side kind had have going stories that were to in some beautiful a use that And have I quality, of CuriosityStream But and that X,XXX – and to kind we to great contractor COVID, the long were we

little lumpy answer question, Tom? your quarters can light Does bit a that of be in Our that.

Tom Forte

Clint. Right. Thanks, Yeah.

So from in a investment subscription I'm one acquisition and trying University Nebula, Day trend businesses to one draw that have and content. One two models

would you how you overall And at So describe strategy? forward? M&A your additional opportunities do going how look

Clint Stinchcomb

Yeah.

factual subscribers. acquire with M&A revenue and and our to been strategy complementary companies think, can I that companies grow to-date enable has to us content grow

the mean, at of Nebula, So economy. center I in of the that creator is case the right

seen a recently of there a recently we've valued seen example as we've bit last that of activity an think round. in right number I at billion $X M&A with this – Moonbug fair was

look, content that's science, of these or in it of education with group. a out, us they into Day highly ours, case kind produced traditional be align a from them older to vessel. obviously category, had processors, our to entertainment when organization we whether to area, younger – are engaging Day smack by creator Mustard, because history, And love country So as One that the we what complements reasons, a Nebula, with area Marques younger we RealLifeLore, – LegalEagle the Jason challenge with the of just highest was that's food. Wendover, quality, of we around partner a had it with of Brownlee Nebula Plum variety they our in or it the U in It's U, around straight call One highest they're America. that like love is a Kilar the great excellent give little for then the a can marketing technology, experience do line that a – North courses it's then demographic. creators think, relates I But And with working an and but he tried found bit

Tom Forte

Great.

Operator

next comes Peter question from Your Bank America. Henderson of with

open. Your line is

Peter Henderson

Thank for the you Hi. taking question.

of I the Spiegel like appears DTC extend subscriber growth in So, I guess just I touch was think to reignite that that on can think spend, side, you're you in saw from what can what also do. little just that it'd the you during quarter And marketing little then increase really XQ deal. follow-up. growth? trends I a better It benefited which you on decision not? made obviously, trend do But mean, you And But that know second the spend. the growth subscriber in and to curious there that the bit. spend or a a very do reduce I'm coming have to be was quarter, a quarter? on to just from in holiday you third one I result marketing period spend going quick want seems to calculation And curious the the just marketing to

Clint Stinchcomb

Yeah.

of Devin. take I'll me and Jason that Let the deal and first part then to

subscribers at quarter, that bundled partners. was level third total due also international in the $XX rounding. the direct paying million dynamics It's grew while to total of significantly around some So larger remained due our to

QX. So of the We with to distributors illustrate think seen have I just fixed as international agreements XXX,XXX are lost point, fixed distributors the we've bundled revenue those quarter. fee or to who US at plus. I'm the an subscribers high subscribers them our sub XXX,XXX citing lots with of last kind video our last actually largely but Peter. these industry customers demonstrates, as few have report as the insulated video from we're -- swings US look in if agreements of don't weeks in certain partners of for example, as you losses -- we as as most our just But video

our That We direct impacts to pace report have by experiencing who video includes to losses buckets year-end. similar bundled international their our increases all sub total number. despite yes partners reported meaningful are But that on it decision, tiers, sense to dynamic, bulk. marketing we're quarter. of And which fourth based makes and what's based this and we with fourth to the money experience to put And on as more more certain in work a partners, we're work think our doing the lot I know in possible quarter. on to

Peter Henderson

in mean, back provide I obviously, you great. trends just I on you're but little far on November weighted, half side? thus you the can could guess it's, bit going That's about October, subscriber fourth color quarter? seeing very know trends any a to I talk through be

Clint Stinchcomb

of Yeah. subscribers, our seeing subscription sponsorship, different I quarter quarter-over-quarter that does look expecting dynamics of mean, in it meaningful includes relates to we're bulk we're and revenue obviously, And, that across even all increases lines. includes includes licensing, QX? includes

Jason Eustace

quarter-over-quarter in It's strong consecutively. the just, business continued The the like for I quarter-over-quarter just mean has we side earlier last the in of -- call. growth been it's said DTC DTC seven the quarters growing

continues the that continues very see to us. that -- we not grow quarter. don't fourth And in for So slowing strongly to down

Peter Henderson

Thank great. you. Okay,

Operator

Instructions] [Operator with And Zilu Pan your next comes from JPMorgan. question

Your open. line is

Zilu Pan

but thank about had on of Thank what question your your drivers quick a would it to the you negotiations those in bundled bit you just little and base Hi, internationally? opportunity partners. out if to wondering grow see a you. both revenue could biggest US be? the talk guide I know, still Do XXXX, growth of second bundled with more you was subscribers. pace would follow-up too subscriber just the streams, you. was would think might wondering be be, I I my the early the And I

Clint Stinchcomb

This Yeah. I'll Clint. is take Zilu. part. first the Thanks

it relates you around to that travel do suffered to to today and to get need with like agreements, our that extraordinarily just it ours, in-person internationally. of pacing pacing due our when difficult COVID. It's bundled have to relatively it's to -- distribution communicate that's really new As a the service has you inability hard

that. a pacing think as the I result So has slowed absolutely of

there available the deals year us. year. in to a going engaged our and the think do year half us success on hand are great to we into of lot those bundled to last growth. a that over that this next subscribers are confidence really have are lot of grow and We And to our to to subscriber lead We It's ability stories those back that like based right and developed and will important that sustainable partners. of deals meaningful with we've

Zilu Pan

part? Second

Jason Eustace

Yes.

would see growth part second Zilu, quarter when we out call. that the of this XXXX strongest question, we'll piece going quarter probably then we as the with the into your the where provide next And be at coming the our biggest fourth have far of on On as year guidance XXXX of first DTC year.

Zilu Pan

Thank you.

Jason Eustace

Yes.

Operator

[Operator Instructions] And we do have a question go from Tom Forte ahead. with D.A. Davidson. Please

Tom Forte

question. Great. a I had follow-up

don't to know where give good your isn't views you've that that for platform, So to content like is that audience content the it couple you Clint I but views. a you're example. had presented of you an had talked a that a it? before can platform course about examples exclusive, a example. able of the necessarily crash thinking you biology of the exclusive you've as lot in examples of necessarily wasn't way But audience if of I'm but drove lot draw

Clint Stinchcomb

that I news Devin Tom. good I'd here, I'll has a crash on But course be the giving. happy gift to. And be supplement, is him yes, keeps have have

course course So way. European have beyond deliver have history, really, course really crash continues a the to world in biology, course history, crash we crash crash literature, we meaningful

like be point to has recognition audience Devin, can CuriosityStream. an that find to? we kind that will content when for so some in that examples that of you'd curating And you has have some aggressive other like

Devin Emery

Yes.

we're on in have is content, can want that might be only way exclusive watch service, that the obviously that products you get content right? keep best factual when on original but you service, to programming in also a a to not building think it. to ways the our then we're our default building to mind we that but thing And tentpole is the watch our I so better

to that, that right? issues ad episode say of is to crash is you none those get is if us. able a next to that of quite and you So It want get the difficult. you right? Obviously, can hassle The load on YouTube on watch high. be YouTube. course extremely are the playlisting If find again, CuriosityStream, watch And for all

talks. content on Awards. platforms you there's there's can of when that that we might European -- create of So other plenty There's can experience a then around Dave Inventor it content a better lot get much Rubenstein be viewing available. There's

complementary is strong for strategy It's for continued our a original very and going a exclusive to us. content. that strategy us, it's be So to

Tom Forte

my for Thanks taking follow-up question. question Great.

Clint Stinchcomb

you, Thank Tom.

Operator

are questions does conclude and may participation There disconnect. now you call. This further this time. conference no at today's your you Thank for

CuriosityStream (CURI) 10 Nov 212021 Q3 Earnings call transcript