BBTVF - Earnings call transcript Q2 2022

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

Operator

Good evening everyone. Welcome to today’s BBTV Holdings’ Second Quarter 2022 Conference Call. My name is Dante, I am your operator for today’s call. [Operator Instructions] I will now pass the conference over to our host, Ms. Nancy Glaister, Chief Legal Officer of BBTV. Ms. Glaister?

Nancy Glaister

second Officer conference for fiscal Glaister, I’m BBTV’s Legal Chief BBTV. to quarter call. XXXX Nancy Welcome

financial During the the course the provide securities forward-looking of These which plans company’s about include this conference and our regarding forward-looking laws. or and forward-looking the position, diversification, business operations, may anticipated expansion, call, growth, future current objectives. make expectations, events relating statements and beliefs company’s and statements statements expected impact to within are results. meaning goals may or These applicable information of regarding we may

Forward-looking performance. may provided outlooks, of they not for taken other management’s be or financial be statements Certain Any future are are goals understanding in regarding statements outlooks inherently or to are guarantees about may meant other as the matters, future and and future and aid financial financial only not particular, not are goals Such in and to expectations oriented be discussed appropriate financial goals purposes. are or achieved. future uncertain. financial results information

number our filed today, as forward-looking by a law. necessarily We results the sedar.com. these uncertainties that could differ issued our in as accurate, in actual well required as our to Information on MD&A risk forward-looking are those and obligation assumptions well forward-looking and as Form not number from latest press except may factors contained undertake assumptions release risks contained in based materially statements statements, the that cause update subject our no on These statements. and include to of of our are All to of risk Annual

and MD&A March today, at non-GAAP sedar.com. about as measures. our adjusted as issued release our will dated Also, and with more press include in which financial read administrators uncertainties can AIF today ratios, securities commentary our these measures are filed well in assumptions, XXXX, Canadian XX, risk You and

presented for found evaluating in earnings with are available not release which Reconciliations and considered financial website should financial the in the believes on our to MD&A, and can information are be measures these our between substitute sedar.com. on useful be the and and as non-GAAP Company a prepared press IFRS. a Company, Although on and accordance two ratios supplement our these in as

also our also further call such certain non-GAAP we of Lastly, report metrics, over earnings Views be as Shahrzad our MD&A. Chief RPMs. on Officer, turn also now found can which I metrics, the Executive release and to Rafati. in and are measures, press A these description BBTV’s

Shahrzad Rafati

to financial BBTV’s call. second to and XXXX quarter press-released SEDAR. our Hi welcome statements We everyone our MD&A posted analyst and financial information and earlier

billion platform, our unique competency, who money. XX everyone to mission creator views As call by media about individual more allowing content VISO to on their more help monetization global of today, viewership a which focus is From increasing helps has and the which money monthly Company reminder innovative making content BBTV XXX creators creators generate comprehensive more their month. creators we’re core content to them while million globally, every creation. BBTV on companies, with powered provides by viewers solutions video to than succeed a a end-to-end make

in our significant platforms growth. in which Facebook. With has our Solutions This cost Plus experienced to we addition on see YouTube tailwinds include significant our Shorts These like adjusted expedited year-over-year, additional we business. for XX% for of revenue guidance see contribution year reiterating the quarter management QX half a XXXX sequentially and our also first Solutions for and our declined been grew driving of direct profitability of Solutions by diversification to Although EBITDA and by for content the programs, paid segment path optimization off. flat Plus the all our Base by Plus growth monetization in year and strong. revenue our the are XXXX. would and remained that we to XX% loans margin last sales, tailwinds over in growing have the like clear advertising business. Base focus to Solutions, over Solutions in revenue We Driven the XX% growth that fundamental note activation is remained

Advertising growth from revenue is represented to strengthen From The This Plus that Content Solutions, indicator investments core the segment. Gaming XX% Plus strong in continue are in investments XX% combined consistently times to paying is our gross year. Solutions Plus And Base Solutions invest gross these also to perspective, that up four continued of specifically we Plus our Apps, last revenue streams up margin grew total Mobile a total of Our in higher Solutions growing our we’re we XX% scale. XX% profile making Direct XX%. represents deliver Plus X% will a earnings Solutions in will Management, overall of they off. sales growth a because to by as revenue continue margins directly to revenue. and last XX% Solutions contribution, from in year. adjusted our profit related They than current QX,

sensitive focus the of views decisions to RPMs. higher Our makes Solutions margin us our short-term on a less and Plus to investment lot volatility

the some clients Paramount NBA, Global, management in the the content industry, is Sony and currently largest BBTV Pictures, with working Fox, of blue including Univision, solutions, more. chip For

saw expansion adding we and Rights partnerships Sony solution, our We an Management expanded Instagram. quarter, on and renewed This our Facebook Pictures. with

number management across channel a launch of our and which number of verticals. the expanded of includes their for also new channels movies We shows partnerships, a TV

with relationship even our with video partnership to strategic expanded their overall digital growth the also initiatives. more make key will help Fox initiatives of that Fox number a to add We

with renewed deals and Relativity also We PBS, Media. BET

the year-over-year. size was teams for team first XX% increase Regarding awareness direct by a half. brand Average with agencies brands. and working off to our QX advertising order strong sales, quarter the and increased And capped are strong our

on increasing of of a streaming portfolio the addition company the music the quarter promote global contextual for while RPMs for demise growth leveraging in sequential on cookies QX, seasonality. in Last RPMs existing the the XX% In over QX over Key revenue strength partner QX five at and sequential Typically, concentrating to QX clients. included beverage year, increased sequentially $X.XX XXXX, was global XXXX. BBTV’s wins due to from new a increase reported were top QX $X.XX to We’re the of views advertising. in QX XX%.

to Alphabet from views billion views while XXX have declined QX. to XX% year for declined content compared sequentially XX% this performance pattern RPMs monetization that by YouTube. down last tied QX a increased X% to $X.XX reported declined switch Atypically, $X.XX the in is we excluding the XXX holds, to to YouTube by primarily billion views when Year-over-year last revenue compared of weeks Shorts So BBTV by views would viewership, ago, RPMs micro performance Two in X%. growth year was by major consumer year-over-year. ad YouTube is platforms. to across down reported XX billion year-over-year to This due year. all closely to

now Shorts preferences. BBTV’s to YouTube introduced YouTube over format last consumer viewership. year represents respond And of XX% to this

Shorts, cascades have are monetize should library, conference announced through million during that yet our we Alphabet solutions market of be represent accelerating stated annually conference approximately they our of previous have YouTube it it as their call which current is calls, incremental could monetized. starting they plans rates. at However, in their to $XX ahead Monetization expected Once across base timing. becomes BBTV. revenue entire monetized across to

the by streams margin sequential sequentially Base trajectories seasonality to content viewership to X% retained the Solutions higher from grew compared $XX our alongside revenue meantime, trends, Plus opposing million mitigate views results was generating With on BBTV and revenue by on of million to Solutions risk still QX. for that emphasis RPMs In concentrating favorable the in end incremental continues $XX.X creators.

continues exceptional in QX, amongst views BBTV be services rate on creators to inherent churn performance. our our believe of platform. the is at retention Our clearly value was in XX%. our retention the reflected low In We

behalf pleased We creators. we quality is have convinced streams from garner a Overall, enterprises. large continues our interest we the Solutions, solutions with the been content that particular, to has to monetizing management, market are content on audiences which to Plus effectiveness response our due and of growth in in lot able this of our Again, highly more industry. to and the revenue in of retain recurring comparison the are towards in predictable

the going performance We’re I’m also about advertising. Groot, for to business. call excited please after highlight the outlook it Ben, over details. will take I in our in financial to Ben hand then our that, direct developments the to our review away. And CFO

Ben Groot

you, everyone. afternoon, Shahrzad, and Thank good

PPA recorded our when QX operating presented as associated allocation Before the that Amortization our Holdings in to entity, our revenue the our acquired XXXX. amortization of in well the noted filings profit amount non-cash. amortization, for is as BBTV company’s was and of margin. we $X.X adjusted a provide should revenue and this the for gross margin commentary price or purchase in Corp. of begin on I’d million fourth be part cost for QX the statutory that amortization share of the results metrics includes of it our IPO transaction the of cost as with performance, the of non-recurring BroadbandTV remind in assets Accordingly, as PPA of XXXX, and everyone the without I our like recorded is main as PPA BBTV will gross of gross review quarter

our to results. turning Now

our for the Solutions We usual consumption typically reflect primarily which Base a The in the offsets due second seasonal gains. quarter changes, decline revenue, resulted not views in QX did to see from recent that uplift. seasonal

our on the sequentially platforms experience include Solution to our growing this and Plus future. fundamental Base we our growth activation Solutions to additional and of Although, flat solutions in significant segment. our expedited our benefits revenue These significant diversification focus contribution is base to continues see in from monetization This in Facebook. Shorts YouTube addition and year-over-year, our like investments which revenues, business remained in tailwinds of the tailwinds revenue the driving declined

revenue to growth our the overall our year-over-year in continues positive gross reflect the Plus margin improved shift in X.X%, Solutions, With which mix. to

revenue high for for had $XX.X is we XX% year QX year, The a million, than QX rates resurgence primarily same advertising and due retention Our when spending, last which out exceptionally QX also experienced strong the to quarter period last at was viewership the the XX% lower of COVID. months. XX coming last comparison XX% remained of exceptionally in total for

the we’ve the views these not XX% monetized stages early growth Micro-content currently activities down the only but also signing outdoor last of of creators. and and from such of views pullback result a the were total demand billion of for year, as impact XX quarters. as which the post-COVID pent-up not micro-content, in last reflecting and we are few are the and pursuits, consumption seen of QX viewership in travel Our off-screen

As focus acquisition of team the content our onboard to monetizable is main creators.

YouTube up ramping creators, X% to quarter as compared being in due the remained of XX% year will to efforts monetized about a views, total now at are down begin the our were forecasted. As to sign than we as this Shahrzad roughly Shorts the quarters. steady which format same mentioned, viewership, earlier of we originally expect micro-content the earlier two RPMs our prior impact

BBTV, As future RPMs monetization. year-over-year would’ve both grown the because this we monetize Alphabet’s their expect growth Shorts trend we of upward not be We the RPMs noted, to benefit as for and RPMs XX% and plans micro-content views by accelerating If the artificially HX to continuing viewership, are to this our now a exclude we’re announcements acquisition to We announce that a RPM YouTube by positive should it monetized. YouTube up Plus consider X% and of significant they YouTube with activation Solutions our figures RPMs. Shorts scale benefits QX depresses combined therefore being and our Shorts our would’ve previously opportunity our grown year-over-year. YouTube Shorts is were ramping our efforts.

below was also we offset strong $XX remind and and partially in guidance. Mobile Our The of Management revenue everyone resulting and XX% Gaming Solutions we performance guidance, in Base Plus XX% our XX% the revenue decrease year-over-year Plus guided Content Solutions for Solutions up and The growth from led Plus our the Sales Plus strong RPMs. Apps annual which results. by in to Direct was growth anticipated rate quarter Solutions for XX% views revenue this rate Solutions had that million, continued growth is our lower was which

less Plus us sensitive views. were we profit Plus total While volatility BBTV to to gross to benefits becoming continued up, we’re Solutions a see allowing our ramp revenue our on its some share in over from margin there lumpiness and be still investments, further rate the at higher expect to Solutions than faster We of time. focused and remain our grow short-term

and amortization, the OpEx reflect X.X%. in XX% content levels of savings Plus The XX% our through million gross $X.X quarter higher lower $X.X revenue should Solutions. gross last QX investment same results. Solutions It’s PPA a now revenue Base revenue total Our is optimization due to year. our or was improved program, to in not year, announced the XX.X% the $XX.X creator note an clear previously our XX% gross Plus ramp identified monetization, our of profit QX of same do the YouTube important last being than were margin to year. $X.X which margin sales QX for to the to as and period resulted yet X.X% for start due higher Solutions BBTV a EBITDA EBITDA million reflected million gross quarter expenses that XX% for of for cost marketing the in and mix Plus the to from Solutions. the excluding business expenses from and Operating part Shorts and our program last path year, adjusted future. a second Solutions third-party profitability higher up our in optimization increased growth Plus see This our million less adjusted businesses spending of continued cost QX. $X.X in activation fees share, the With was loss profit, we which in representing for to platform up for XX.X% the comparable period of was of million, last represents

In our balance ended million in $XX.X cash of we and terms facility. with utilize overdraft million of sheet, quarter the million $X.X the $XX

XXXX. BBTV I the back liquidity months. maturity $XX.X least it and at turn to balance in our will with EBITDA XX Our adequate long-term forecast debt that on has was comfortable of million XX as timelines, we Based breakeven June Shahrzad. next for now are

Shahrzad Rafati

scale you, increase Thank we’re that working like would and to Ben. our activities itemize on margins. our to I some of revenues our

We where most are opportunities continue higher on Solutions, concentrate to and will our of Plus activities are margins increasing.

shoring two also up we’re However, Solutions our in streams ways. Base

to for And our work a to will revenue key Shorts, grow YouTube creator monetize in announce program. improved and with our accelerated newly We like our YouTube base growth other diversifying way are our launched scalable now we further then overall driver Solutions. and to This platforms multi-platform timeframe. partnership under a Facebook is margins Base

Plus current on a key margins their to grow Base with existing to help are continuing will times As and audiences X leverage X Content to on platforms Solutions competitive growth. and management higher to build, YouTube. than new continue Solutions plan be clients, advantages our key driver monetize online. for new We

bipart, ad key which to owned dollars four, keep talent; of strategy reach creators our leveraging to delivering and direct to larger enterprise best our a finally, the as have pipeline and media of very businesses; transactions fruition. massive ability promoting The investors and clients sets will our on two, One, updated clients; from to is We leveraging hiring data strong continue they directly come people we buyers; sales of delivering them five growth color unique consists strategic black minority leveraging insights. track premium CTV three, and for indigenous elements.

We direct east central U.S. continue markets. in and advertising our the expansion team the west of

at segments category NGO, this presence our Lochner Earlier designed Erich to As of of brought access expansion Media, Base in creators, is BBTV’s scaled we library enhance our expertise infrastructure. and beverage. and others. have which uniquely and Facebook, of core like a extensive and other neither our to expand Solutions has platforms content, twice our scalable successfully in and similar offerings tech, entertainment, Instagram, He community help apparel, auto, on technology, before a of way Outloud reach, us reminder, to Jellysmack across CPG, TikTok, year,

currently platforms and teams with Instagram in contracts will be in demand future. micro the leading a near and to up content other YouTube on Our we up like economy and like the positions of for Shorts, growing Facebook space, in tech ramping on Reels. X,XXX creators, There’s player are scaling us TikTok, uniquely expertise this TikTok years Snapchat industry be major and creator

views As of stages I micro and not monetized in creators. we’re mentioned, currently content are these early signing

content As team focus acquisition creators. to our onboard main for is the monetizable

expect efforts format Solutions than we rates. it cost team at approximately the In across Now by YouTube earlier across we their monetization could of million forecasted, ramping to annually is our sign library, market XX%. our begin represent Base mid-June, incremental conducted will exercise this content optimization our headcount monetized approximately that that reduced revenue current up creators. Once originally becomes now our entire micro Shorts $XX

engaged also current The optimization funds, focus not price we our faster. conclude activities to us of the on With will did transactions I are to that was saying and to is that results levels. that to and towards in market us in have will conditions, our very cautious drive impact remain will price respect any flow sticky. accretive our really Given months. on core the coming cash help that realized it the strong creators put model that positive share M&A, to we cost are business do we exercise by share QX however, felt ensure we prudent and several sustained we of valuable impact want be makes future the a current

months. proven deliver Based Our business new model management minimal for And have is and meaningful the it liquidity at that timelines adequate we’re add business breakeven that can comfortable our technology has on able at to continuously and are so cash flow. next expense. highly revenue streams model scalable adjusted and forecast XX extensible, we least

challenging been trough. are has that a revenue the we throughout we XXXX exiting believe earnings of half first and and The industry

platforms towards like YouTube monetization our have other of future expansion revenue growth. higher we accelerated Facebook, and visibility the onto Shorts With

The first XXXX believe revenue we of we trough. a throughout are and that And challenging the has half exiting earnings industry. been

and profitable expansion we platforms With growth. diversify BBTV like come uniquely cost out streams to have Solutions Facebook, for our quality the result, With more margins accelerated positioned other attainable visibility of before. we onto with we’ve the are and to Plus Shorts ever has is monetization of had YouTube that higher this trough the foresight this optimization, higher revenue business. our ever a higher and than revenue further as towards revenue to growth

that is We believe now company. our business about the it we’re maximizes capital that up and I can value We’re in way our of for the future, excited strong, a open allocating questions.

Operator

[Operator from first comes Capital. you, ma’am. Thank question Instructions] Our Eight Kadve Adhir from

Your now open. line is

Adhir Kadve

give Thanks give Hi. you accelerated my starts? And it’s said but previously taking new for Shorts questions best guys. Thanks to the kind us of think that I when guidepost? of is YouTube here. ask may can have a sense wanted for you I maybe QX timeline kind us the timeline Can that a you timeline. accelerated, given of about that,

Ben Groot

Absolutely. Shahrzad. ahead, Yes. Go

Shahrzad Rafati

it. go it, Go for Ben, for

Ben Groot

a Yes. YouTube of they’re it But they’re half the into and year, Alphabet’s that second Yes. even Largely mentioned so expecting testing accelerating based going Adhir quarter. on of so QX weeks scale earnings Shorts monetization last up at that the already been ago, they’ve couple they and QX. call had in to ramp this

Adhir Kadve

be of content be easy get of It it’d on kind and given content creating also for seems acquisition would with entail? content guys this can And then great. creators on though you your Okay, back – sense to micro are your of us probably YouTube, as it of, deep almost you as library of would maybe though, the Shorts. those what a that efforts, of content give YouTube creators kind who seems just that,

kind a us acquisition content play will your sense micro of give out? of So how efforts

Shahrzad Rafati

sure. For

really necessarily we we actually that And result that also a content content shorts efforts, look would to of you The it from team, viewership diverse the able short form creators onboard have actually now monetized, content, micro it, at comes content more of as less YouTube form onboarding than acquisition minute micro coming have Shorts. content content shorter content. every formats the So the that that onboard And creator – have have monetizing to that, team know, the content. platform actually been of been And the content acquisition range evolving, having to as range a know, regular Adhir, you to are But form even mandate content with to you about from obviously when focus are and be be focused we’ve the in have given content. content of to that YouTube monetizable XX% see content. creators on way our shorter a long multiple place as content. hasn’t and to we creators again, our longer

we So gets the viewership increasing monetize. already is YouTube will this the And that underway. ramp see format over actually as Shorts

Adhir Kadve

would Facebook, And Okay. any on costs are? we expectations us here? What and diversification maybe Maybe that long that associated just then any additional what’s entail? would how your you color take the where can give it onto with

Shahrzad Rafati

make when to I really multi-platform place it streams. idea meta Facebook take specifically to sure, For the and revenue mean, comes scalable the program and is

are that and fact based and launching it from repurposing Facebook across to have where allow audiences existing already we’ve particularly contracts, existing our would comes rights those done digitally new content us it just platforms to on is that what Facebook the already consuming down content Given it’s – including on generate it streams. we the channels revenue the all creators with

of as think to And attractive For going to terms significant of this scale. content YouTube question is of end and your year of if matter even opportunity build and don’t going year know a that? some And to want in XXXX. then fact, revenue answer like next terms see XXXX be this more to the Ben in we you maybe would I creators years. we look you answer of be revenue are up this actually ramping as to course, at stream

Ben Groot

Yes.

in is content and ones video the to that repurposing on the Facebook, that and because content doing we’re editing just deployment. the different is piece think I our the other strategy we’re existing bit a

charge creators. share much our higher to able a to revenue We’re

at five higher we so be Solutions. so on some like than Plus margins least Solutions, our than to existing the new Facebook even higher expect times Base platforms, our And of

Adhir Kadve

then in Okay. you in having can probably maybe kind the QX see you said, really efforts guys taking take terms where of – some to additional optimization, give just I start place? where us where Got And of color onwards, these cost know but it. it’ll on going really they’re place you

Ben Groot

Yes.

As saw I’m our release our update cost you press We head an our of had sure about total of count. in on XX% reductions initiative.

So that in relation focused it’s was largely areas to headcount and then where where profitable. less we were

we business base it targeted certain savings. units like to So solutions and the services came when had shared

Adhir Kadve

it. Okay. Got And unless...

Shahrzad Rafati

if strong business want when Yes. months. business. make really course, on And you optimization, And to revenue that to across – we the liquidity comes and believes we the needed have as looking I or exercise, ask is actually XX services, a really it cost were profitability. we do because at have an we to the this we that specifically as a the sure to goal that, we as of to get And we case, sustainable cost whether make in sure over management exercise conservative want it’s outlined basis when next ongoing to optimization shared

So is optimization really and our our just that. exercise, all office cost exercise around

rates if as to you’re this looking sustain we’re and and We quickly that Plus against core to And with that. the XX% guiding so moving that profitability as when is saw are the of we continue the can we how more forward. where we of – components why And get with Plus, at growth than at Solutions possible. business those looking growth, do Plus, growth

growth grow the revenue had that promising, shows really higher We’re streams that really Solutions revenue very have still foresight Plus doubling down are to and diversify the been again, on management rates Plus which streams across margin. and

Adhir Kadve

Thank colors very all line. guys. pass the the much, I’ll Okay. you for Thanks

Shahrzad Rafati

Thank you.

Operator

sir. no are registered you Thank no registered questions [Operator time. are Instructions] this time. at There currently this at questions There questions, your for

continue. So Quarter the ma’am BBTV conclude call That Second – here. we sorry will the Holding will conclude

Shahrzad Rafati

everyone thank joining. said No, for that’s great. you No. I

Operator

That will call. BBTV XXXX second your Holding conference for conclude Thank the quarter you participation.

now may You your disconnect line.

BBTV (BBTV) 11 Aug 222022 Q2 Earnings call transcript