Catena Media hopes tech and AI improvements offset “weak” performance

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Catena Media has told investors of its “weak performance” in Q4 2023 and for the full year, but explained that internal investment into technological and AI initiatives can help to boost its future fortunes. 

A tough period of trading for the affiliate business saw Catena publish revenues of $15.5m for Q4 of 2024, a decrease of 41% to 2022 comparatives of $26.2m.

Period trading saw Catena book impairment charges totalling $36.4m, related to the sale of some of its European media assets, undertaken as part of the firm’s strategic review which concluded last year.

Following the strategic review and reorganisation efforts, Catena reported an adjusted Q4 EBITDA from continuing operations of $1.6m, down 88% to 2022 comparatives of $12.6m.

North America continues to be the firm’s primary focus after it sold its European assets. Catena registered a 43% decline in revenues in North America to $13.2m, combined with a 66% decrease in adjusted EBITDA to $4.6m.

Group CEO Michael Daly commented: “In Q4, market headwinds caused revenue and EBITDA declines in our core North American market. Lower cost-per-acquisition (CPA) rates paid by operators again impacted revenue, as did stiffer competition directed against us as the established market leader.

“We are responding to this competition to minimise the impact on market share. As in Q3, a pullback in marketing spend by operators led to lower user searches for sports betting and casino terms and a reduction in new depositing customers (NDCs). We also faced difficult comparatives due to the absence of a large state launch to offset Maryland in Q4 last year.”

For the full year of 2023, Catena registered revenues of $82.4m, marking a decrease of 22% from FY2022 results of $104.9m. Revenue from North America also declined 21% to stand at $71.7m, accounting for 87% of group revenue from continuing operations.

The challenging year was compounded as the firm reported a 19% decline in new depositing customers (NDCs) to 185,000, compared to FY2022’s 228,600.

However, Daly is looking to internal investment in new technologies to help improve operational efficiency and improve its content output. 

Catena told investors that it expects its new technical platform to launch in Q1 2024, alongside a new joint venture for AI-driven content production.

“The cornerstone of our transformation is a new technical platform that will launch in Q1. Once fully rolled out in Q2, this will be the first time Catena Media focuses affiliation activities on a single, coherent tech infrastructure,” Daly explained.

“Creating this new backbone is a step change that will make us technically far more robust across all products and make it easier to deploy new verticals.”