Digital Turbine (APPS) Q1 Earnings Beat, Revenues Fall Y/Y
Digital Turbine APPS reported first-quarter fiscal 2024 non-GAAP earnings of 18 cents per share, which beat the Zacks Consensus Estimate by 50%. However, the figure declined 52.6% from the year-ago quarter.
Revenues of $146.4 million beat the consensus mark of $143.1 million. However, the top line plunged 22% year over year.
Weak momentum across On Device Solutions and App Growth Platform remained a concern.
Quarter Details
Revenues from On-Device Solutions fell 17% year over year to $98.3 million due to lower daily active users on prepaid devices and declining new device volumes in the United States and internationally.
Revenues from the App Growth Platform decreased 32% year over year to $48.9 million due to softness in digital advertising demand, consolidation effect, and exiting of certain legacy AdColony business lines and platforms.
Digital Turbine, Inc. Price, Consensus and EPS Surprise
Digital Turbine, Inc. price-consensus-eps-surprise-chart | Digital Turbine, Inc. Quote
Operating Details
Adjusted gross margin in the reported quarter was 47%, which contracted 300 basis points year over year.
Adjusted EBITDA decreased 48% year over year to $27 million.
In first-quarter fiscal 2024, product development expenses increased 11.8% year over year to $15.8 million.
Sales & marketing expenses declined 3% year over year to $15.6 million.
General & administrative expenses increased 7.4% year over year to $40.5 million.
Operating expenses, as a percentage of revenues, were 103.2% compared with the year-ago quarter’s 87%.
The company reported operating loss of $4.7 million in the reported quarter, down 119.3% year over year.
Balance Sheet & Cash Flow
As of Jun 30, 2023, Digital Turbine had cash and cash equivalent and restricted cash of $59.1 million compared with $75.6 million as of Mar 31, 2023.
It generated $1.32 million in cash from operations compared with $15.9 million in the previous quarter.
The company generated a free cash flow of ($5.6) million compared with $12.5 million generated in the prior quarter.
Guidance
For second-quarter fiscal 2024, Digital Turbine expects revenues between $141 million and $149 million. The Zacks Consensus Estimate for the same is pegged at $147.35 million.
Non-GAAP adjusted EBITDA is expected between $25 million and $27 million.
Adjusted earnings are expected in the range of 13-15 cents per share. The consensus mark for the same stands at 15 cents.
Zacks Rank & Stocks to Consider
Currently, Digital Turbine carries a Zacks Rank #3 (Hold).
Digital Turbine’s shares have tumbled 36% compared with the Zacks Computer and Technology sector’s rise of 38.5% year to date.
Some better-ranked stocks in the same sector are CACI International CACI and BILL Holdings, Inc. BILL, each carrying a Zacks Rank #2 (Buy) and NetEase NTES, which sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Shares of CACI International have gained 17.8% year to date. CACI is set to report its fourth-quarter fiscal 2023 results on Aug 9.
Shares of BILL Holdings have risen 0.2% year to date. BILL is set to report its fourth-quarter fiscal 2023 results on Aug 17.
Shares of NetEase have declined 47.2% year to date. NTES is scheduled to report second-quarter 2023 results on Aug 24.
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