Zedge, Inc. reported a modest increase in revenue for the three months ended October 31, 2024, achieving $7.194 million, up 1.6% from $7.081 million in the same period last year. The company's financial performance was impacted by a 12.3% decline in monthly active users (MAU) for its Zedge App, which fell to 25 million. Despite this drop, subscription revenue rose by 21.1% to $1.182 million, driven by the introduction of new subscription offerings, including a lifetime subscription product for Android users launched in August 2023.
The company's operational costs saw significant changes, particularly in selling, general, and administrative expenses, which increased by 23.8% to $6.809 million. This rise was attributed to higher payroll and user acquisition expenses. In contrast, direct costs of revenue decreased by 5.1% to $461,000, reflecting improvements in backend infrastructure. Zedge's net loss for the quarter was $339,000, compared to a loss of $15,000 in the prior year, indicating a substantial decline in profitability.
Zedge's strategic developments included the ongoing integration of its acquisition of GuruShots, a photography competition platform, which has faced challenges with a 25.9% decrease in monthly active payers. The company has revamped GuruShots' onboarding experience to enhance user engagement and retention. Additionally, Zedge has focused on expanding its product offerings, including the launch of generative AI features in its app, which contributed to a 141.7% increase in Zedge Premium net revenue.
As of October 31, 2024, Zedge's total assets stood at $38.198 million, with cash and cash equivalents of $20.196 million. The company reported a global headcount of 102 employees, up from 95 a year earlier. Looking ahead, Zedge anticipates that its cash flow from operations will be sufficient to meet its financial obligations for the next twelve months. The company remains focused on leveraging synergies between its Zedge App and GuruShots to drive growth and enhance user engagement in the competitive digital content marketplace.
About Zedge, Inc.
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