Acast Sales Up, Loss Widens For Third Quarter 2022

Sales Up, Job Cuts Loom

ACAST net sales increased 21% year-over-year to SEK322 million, with loss widening from SEK46.1 million to SEK68.5 million (SEK0.38/share). U.S. sales grew 16%, with EUROPE up 22% and the rest of the world 36%. The company has also announced that it will lay off about 15% of its workforce before the end of the year.

CEO ROSS ADAMS said, "The third quarter has been marked by an increased concern and uncertainty regarding the macroeconomic development worldwide. History tells us that when a recession is close, the advertising market is generally affected early in the cycle, and indeed we have noted a gradually cooler market year to date. But ACAST is one of the largest market-leading businesses creating technology for the distribution and monetization of podcasts and we have strengthened our position in this challenging market, not least through the acquisition of PODCHASER. This improves our competitive positioning and ability to create new revenue streams for ACAST. As noted, in the quarter we saw sequential improvement in EBITDA illustrating that we are moving towards profitability, in line with our plan laid out earlier this year."

ADAMS added, "During the quarter, we have announced that we are reviewing the organization with the intention of reducing the cost base, and reorganizing for a new phase, going from hyper-growth to profitability. For several years, we have worked hard and invested heavily in building our technology platform to generate new revenue streams. We are now in a position where we can reduce the cost base without compromising on quality vis-à-vis our customers and partners, and thus create profitable growth in line with the company’s updated financial goals. The planned cost reductions affect approximately 15 percent of ACAST’s current workforce and are expected to be completed before the end of the year."

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