Financial Performance - Fourth quarter revenue totaled $119.2 million, representing year-over-year growth of 6% compared to $112.2 million in the fourth quarter of fiscal 2024[2][4] - Fourth quarter GAAP net loss was $18.8 million, or ($0.18) per share, significantly improved from a net loss of $236.5 million, or ($2.32) per share, in the same quarter last year[2][5] - Non-GAAP adjusted net income for the fourth quarter was $10.8 million, or $0.10 per share, compared to $12.6 million, or $0.12 per share, in the fourth quarter of fiscal 2024[2][6] - Non-GAAP adjusted EBITDA for the fourth quarter was $20.5 million, representing a year-over-year increase of 66% from $12.3 million in the fourth quarter of fiscal 2024[2][6] - Fiscal year 2025 revenue totaled $490.5 million, with a GAAP net loss of $92.1 million, or ($0.89) per share, compared to a net loss of $420.4 million, or ($4.16) per share, in fiscal 2024[2][7] - Non-GAAP adjusted EBITDA for fiscal year 2025 was $72.3 million, down from $92.4 million in fiscal 2024[2][8] - Consolidated net revenue for the year ended March 31, 2025, was $490,506 thousand, a decrease of 10% from $544,482 thousand in 2024[39] Revenue Breakdown - Total On Device Solutions revenue for fiscal year 2025 was $341.6 million, while App Growth Platform revenue was $153.2 million[6] - Net revenue for the three months ended March 31, 2025, was $119,152 thousand, an increase from $112,223 thousand in the same period of 2024, representing a growth of 8.6%[31] - On Device Solutions revenue increased by 11% to $86,832 thousand for the three months ended March 31, 2025, compared to $78,504 thousand in the same period of 2024[37] - App Growth Platform revenue decreased by 3% to $33,250 thousand for the three months ended March 31, 2025, down from $34,437 thousand in 2024[37] Cost and Expenses - The total costs of revenue and operating expenses for the three months ended March 31, 2025, were $130,844 thousand, significantly lower than $320,062 thousand for the same period in 2024, indicating a reduction of 59.1%[31] - The company reported a total of $39,464 thousand in product development expenses for the year ended March 31, 2025, down from $54,157 thousand in 2024[39] - General and administrative expenses increased to $173,647 thousand for the year ended March 31, 2025, compared to $169,617 thousand in 2024[39] Cash Flow and Assets - Cash and cash equivalents and restricted cash at the end of the period on March 31, 2025, were $40,084 thousand, up from $33,605 thousand at the end of March 31, 2024, reflecting an increase of 19.0%[35] - Total assets decreased to $812,854 thousand as of March 31, 2025, from $865,540 thousand as of March 31, 2024, a decline of 6.1%[33] - Long-term debt, net of debt issuance costs, increased to $408,687 thousand as of March 31, 2025, compared to $383,490 thousand as of March 31, 2024, an increase of 6.6%[33] Loss and Improvement - The net loss attributable to Digital Turbine, Inc. for the three months ended March 31, 2025, was $18,826 thousand, compared to a net loss of $236,506 thousand in the same period of 2024, showing an improvement of 92.0%[31] - The company experienced a comprehensive loss of $18,000 thousand for the three months ended March 31, 2025, compared to a comprehensive loss of $238,968 thousand for the same period in 2024, reflecting a reduction of 92.5%[31] - The company reported a basic net loss per common share of $0.18 for the three months ended March 31, 2025, compared to a basic net loss per common share of $2.32 for the same period in 2024, indicating a significant improvement[31] Future Outlook - The company expects fiscal year 2026 revenue to be between $515 million and $525 million, with non-GAAP adjusted EBITDA projected between $85 million and $90 million[12] - The CEO highlighted strong advertiser and partner demand, along with profit margin expansion, as key drivers for continued growth in fiscal 2026[3] - The company is making meaningful progress in utilizing AI and Machine Learning to optimize first-party data and explore new opportunities for Alternative Apps distribution[3] Shareholder Information - The weighted-average common shares outstanding for the three months ended March 31, 2025, were 105,427 thousand, compared to 101,974 thousand for the same period in 2024, an increase of 3.4%[31] - The company reported a foreign currency translation gain of $826 thousand for the three months ended March 31, 2025, compared to a loss of $2,462 thousand for the same period in 2024, indicating a positive shift in foreign exchange impact[31] Non-GAAP Metrics - Non-GAAP gross profit for the three months ended March 31, 2025, was $56,604 thousand, representing a gross profit margin of 48%, up from 46% in the same period of 2024[39] - Non-GAAP adjusted net income for the year ended March 31, 2025, was $36,837 thousand, down from $60,272 thousand in 2024[41] - Non-GAAP adjusted EBITDA for the three months ended March 31, 2025, increased to $20,462 thousand, compared to $12,301 thousand in the same period of 2024[43] - Non-GAAP free cash flow for the three months ended March 31, 2025, was $5,466 thousand, a significant improvement from a cash outflow of $15,637 thousand in 2024[45]

Financial Performance - The company reported a GAAP net loss of $18.8 million for the fourth quarter of fiscal 2025, a significant improvement from a loss of $236.5 million in the same quarter of fiscal 2024 [5][10] - Non-GAAP adjusted net income for the fourth quarter was $10.8 million, compared to $12.6 million in the fourth quarter of fiscal 2024 [6][10] - Total revenue for the fourth quarter of fiscal 2025 was $119.2 million, reflecting a year-over-year growth of 6% from $112.2 million in the fourth quarter of fiscal 2024 [4][10] - For the full fiscal year 2025, total revenue reached $490.5 million, down from $544.5 million in fiscal 2024 [7][10] EBITDA and Cash Flow - Non-GAAP adjusted EBITDA for the fourth quarter of fiscal 2025 was $20.5 million, representing a year-over-year growth of 66% from $12.3 million in the fourth quarter of fiscal 2024 [6][10] - Non-GAAP adjusted EBITDA for the full fiscal year 2025 totaled $72.3 million, down from $92.4 million in fiscal 2024 [9][10] - Non-GAAP free cash flow for the fourth quarter was $5.5 million, a recovery from a negative cash flow of $15.6 million in the same quarter of the previous year [10][20] Revenue Segmentation - Revenue from On Device Solutions for the fourth quarter was $86.8 million, an increase of 11% year-over-year, while App Growth Platform revenue was $33.3 million, a decrease of 3% [37] - For the full fiscal year 2025, On Device Solutions revenue was $341.6 million, down 8% from $370.1 million in fiscal 2024, and App Growth Platform revenue was $153.2 million, down 14% from $178.8 million [37] Management Commentary - The CEO highlighted improved execution and solid year-over-year growth in both revenue and EBITDA, attributing this to strong advertiser demand and profit margin expansion from a transformation program [3] - The company expressed optimism for continued growth in fiscal 2026, driven by advancements in AI and machine learning to optimize first-party data [3][11]

Core Insights - Digital Turbine, Inc. is expected to report a quarterly earnings decline to 4 cents per share, down from 12 cents per share in the same period last year [1] - The company projects quarterly revenue of $116.64 million, an increase from $112.22 million a year earlier [1] Recent Performance - On February 5, Digital Turbine reported quarterly earnings of 13 cents per share, exceeding the analyst consensus estimate of a loss of 1 cent [2] - Quarterly revenue was reported at $134.64 million, surpassing the consensus estimate of $123.68 million [2] - Following the earnings report, Digital Turbine shares fell by 4.1% to close at $4.98 [2] Analyst Ratings - B of A Securities analyst downgraded the stock from Neutral to Underperform, reducing the price target from $3.5 to $1 [6] - Macquarie analyst maintained a Neutral rating and lowered the price target from $3 to $2 [6] - Craig-Hallum analyst maintained a Buy rating but cut the price target from $5 to $4 [6]

Core Viewpoint - Digital Turbine, Inc. will host a conference call to discuss its fourth quarter and fiscal 2025 financial results and operating progress on June 16, 2025 [1] Group 1: Conference Call Details - The conference call will take place at 4:30 PM ET / 1:30 PM PT [1] - The call will be hosted by CEO Bill Stone and CFO Steve Lasher [1] - Access to the call can be made via a webcast link or by dialing specific phone numbers for the U.S. and international locations [1] Group 2: Playback Information - A playback of the conference call will be available until June 23, 2025 [2] - The replay can be accessed through designated phone numbers with a passcode [2] Group 3: Company Overview - Digital Turbine is focused on enhancing mobile experiences for consumers and delivering results for mobile operators, advertisers, and publishers [3] - The company's platform simplifies the process for partners to achieve recognition, acquisition, and monetization [3] - Digital Turbine is headquartered in North America and has offices globally [3]

Core Viewpoint - Digital Turbine (APPS) is expected to report a decline in earnings for the fourth quarter of fiscal 2025, with a consensus estimate of 5 cents per share, reflecting a 58.33% decrease from the previous year [1] Group 1: Earnings Performance - The Zacks Consensus Estimate for fiscal fourth-quarter earnings is unchanged over the past 30 days, indicating a significant decline compared to the year-ago quarter [1] - Digital Turbine has consistently beaten the Zacks Consensus Estimate in the last four quarters, with an average surprise of 281.67% [1] Group 2: Revenue Growth Factors - Strong international On-Device Solutions (ODS) momentum is expected to have contributed to revenue growth, following a 100% year-over-year revenue surge in the third quarter [2] - The company has expanded its global device partnerships, enhancing international revenue per device through collaborations with Motorola, Nokia, and T-Mobile US [3] Group 3: Market Dynamics - Despite soft device sales in the U.S., Digital Turbine has made significant progress internationally through partnerships with various companies, which is expected to support growth in the upcoming quarter [4] - The transition from waterfall to SDK bidding is anticipated to negatively impact performance, disrupting legacy Demand-Side Platforms (DSPs) and slowing down exchange monetization [5] Group 4: Challenges - Continued softness in U.S. device volumes is expected to pressure the company, offsetting growth opportunities in international markets [6]

Group 1: Momentum Investing Overview - Momentum investing contrasts with the traditional "buy low and sell high" strategy, focusing instead on "buying high and selling higher" to capitalize on fast-moving stocks [1] - Identifying the right entry point for trending stocks can be challenging, as they may lose momentum if future growth does not justify their high valuations [1] Group 2: Investment Strategy - A safer investment approach involves targeting bargain stocks that exhibit recent price momentum, utilizing tools like the Zacks Momentum Style Score to identify such opportunities [2] - The 'Fast-Paced Momentum at a Bargain' screen is effective in spotting fast-moving stocks that remain attractively priced [2] Group 3: Digital Turbine (APPS) Analysis - Digital Turbine (APPS) has shown a four-week price change of 1.4%, indicating growing investor interest [3] - Over the past 12 weeks, APPS stock has gained 18.1%, demonstrating its ability to deliver positive returns over a longer timeframe [4] - APPS has a beta of 2.41, suggesting it moves 141% higher than the market in either direction, indicating fast-paced momentum [4] Group 4: Valuation and Earnings Estimates - APPS has a Momentum Score of A, suggesting it is an opportune time to invest in the stock [5] - The stock has a Zacks Rank 2 (Buy) due to an upward trend in earnings estimate revisions, which typically attracts more investor interest [6] - APPS is trading at a Price-to-Sales ratio of 0.65, indicating it is relatively cheap, as investors pay only 65 cents for each dollar of sales [6] Group 5: Additional Opportunities - Besides APPS, there are other stocks that meet the criteria of the 'Fast-Paced Momentum at a Bargain' screen, presenting further investment opportunities [7] - The Zacks Premium Screens offer over 45 different strategies tailored to help investors find winning stock picks [8]

Core Insights - The mobile advertising technology sector is rapidly evolving due to the maturation of the digital economy and changing user privacy regulations, with Digital Turbine, Inc. (APPS) and AppLovin Corporation (APP) taking different approaches to growth and profitability [1] Digital Turbine - Digital Turbine's On-Device Solutions and App Growth Platform (AGP) are driving significant growth, with international On-Device revenues increasing by 100% year-over-year in Q3 of fiscal 2025, indicating strong advertiser demand and effective operational execution [2] - The company has expanded its global presence through partnerships with major device manufacturers like Motorola, Nokia, and Xiaomi, allowing for seamless app distribution and integration of its technologies across various regions [3] - Despite a near-term risk from softness in U.S. device volume due to extended hardware upgrade cycles, international growth and platform diversification provide substantial offsets [5] AppLovin - AppLovin benefits from integrating AI into its ad tech platform, catering to the increasing demand for data-driven solutions among mobile advertisers [6] - The divestiture of its gaming unit for $900 million allows AppLovin to focus on high-margin advertising solutions, aligning its resources with the global digital advertising market [7] - The AXON ad engine, which utilizes machine learning for enhanced targeting and performance, is central to AppLovin's growth strategy [8] - Financially, AppLovin reported a 44% year-over-year revenue increase and a 78% rise in adjusted EBITDA in Q4 of 2024, with net income growing by 248% year-over-year, showcasing strong demand and operational efficiency [9] Earnings Estimates - The Zacks Consensus Estimate for Digital Turbine's fiscal 2025 earnings has increased by 50% over the past 90 days, with a consistent earnings beat trend in the last four quarters [10] - Conversely, AppLovin's earnings estimates for 2025 have been revised downward by 2.8% in the past 30 days, although it has also consistently beaten earnings estimates in recent quarters [11] Stock Performance - Year-to-date, Digital Turbine shares have risen by 87.6%, while AppLovin's stock has declined by 10.8%, contrasting with a 5.8% drop in the S&P 500 [12] Investment Outlook - Digital Turbine is well-positioned for long-term growth due to strong advertiser demand and a growing network of partnerships, although macroeconomic challenges may temper near-term gains [15] - AppLovin's strong earnings momentum and focus on high-margin ad tech suggest positive long-term prospects, but recent downward revisions warrant caution [16]

Core Viewpoint - Digital Turbine (APPS) has experienced a significant stock price decline after reaching a 52-week high, yet it has shown strong year-to-date performance compared to its industry peers [1][2]. Year-to-Date Price Performance - APPS shares have increased by 58.6% year-to-date, outperforming the Zacks Computer & Technology sector and the Zacks Internet – Software industry [1]. - In contrast, Unity Software and AppLovin have seen declines of 19.2% and 27.1% respectively [2]. Factors Driving Digital Turbine Stock - The On-Device Solutions business has been a major growth driver, with international On-Device revenues increasing by 100% year-over-year in Q3 of fiscal 2025 [7]. - Strong advertiser demand and high revenue per device in both U.S. and international markets indicate the platform's efficiency and pricing power [7]. - Strategic partnerships with major mobile brands like Motorola, Nokia, and Xiaomi have expanded Digital Turbine's reach [8]. - The App Growth Platform, which includes Advertising Solutions and Ad Monetization Solutions, is a key growth engine, benefiting from increased ad spending on mobile [10]. - The company has diversified its AGP supply beyond game publishers, positioning itself for scalable growth in the mobile app segment [11]. Challenges to Consider - Despite strong performance, there are challenges such as softness in U.S. device volumes and fluctuating consumer demand, which could limit expansion opportunities [12]. - Recent earnings estimate revisions show a 50% increase for fiscal 2025, but no recent changes have been made [13]. Conclusion - Digital Turbine is positioned for long-term growth due to strong advertiser demand and global partnerships, with On-Device Solutions and the App Growth Platform as key drivers [15]. - However, macroeconomic uncertainties and competitive pressures may limit near-term upside, suggesting a hold rating is appropriate while awaiting clearer catalysts [15].

Group 1 - The core thesis for APPS focuses on stabilizing the ODS segment and expanding the advertisement segment [1] - The advertisement segment is expected to create value due to its high gross margins, despite operating on a relatively low-performance platform [1]

Industry Overview - The Zacks Internet Software industry is experiencing growth due to accelerated demand for digital transformation and a shift to cloud solutions, particularly Software as a Service (SaaS) [1][2] - The industry is benefiting from the increasing deployment of AI, generative AI, and the proliferation of Augmented and Virtual Reality devices, alongside rising cybersecurity application demand due to sophisticated cyber-attacks [2] Key Trends - The adoption of SaaS is growing, driven by the need for flexible and cost-effective application delivery, which reduces deployment time compared to legacy systems [5][6] - The pay-as-you-go model is gaining traction, allowing users to scale offerings based on needs, while the subscription-based model ensures recurring revenues [8] - The ongoing transition to cloud environments is creating opportunities, particularly in securing cloud platforms and increasing demand for performance management monitoring tools [9] Industry Performance - The Zacks Internet Software industry holds a Zacks Industry Rank of 83, placing it in the top 34% of over 250 Zacks industries, indicating bright near-term prospects [10][11] - The industry's earnings estimates for 2025 have increased by 11.8% since June 30, 2024, reflecting a positive earnings outlook [12] Comparative Returns - Over the past year, the Zacks Internet Software industry has returned 16.8%, lagging behind the S&P 500's 17.1% but outperforming the broader Zacks Computer and Technology sector, which appreciated by 15.2% [14] Current Valuation - The industry is currently trading at a trailing 12-month price-to-sales (P/S) ratio of 4.74X, compared to the S&P 500's 5.18X and the sector's 6.15X [15] Company Highlights - **Unity Software**: A Zacks Rank 1 company, benefiting from strong adoption of its game engine, with 70% of the top 1,000 mobile games made using its platform. Shares have appreciated 14.1% year-to-date, with a narrowed loss estimate for 2025 to $1.22 per share [16][18] - **nCino**: Also a Zacks Rank 1 company, experiencing strong sales momentum and expansion in key markets. Despite a 6.8% decline in shares year-to-date, the earnings estimate for 2025 remains at 72 cents per share [18][21] - **Digital Turbine**: Another Zacks Rank 1 company, expecting stable device sales in 2025, with shares skyrocketing 102.9% year-to-date and a fiscal 2025 earnings estimate of 30 cents per share [22][23]