Release Date: July 15, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Revenue for Q3 grew by 8.2%, indicating a positive trend in revenue growth.
- The company has seen a 9% growth over the past five quarters, compared to 3.5% in previous years.
- Destiny Media Technologies Inc (DSNY, Financial) has launched a new product, Meter, which is expected to open a new addressable market.
- The company is investing in organic growth strategies, focusing on expanding Play MPE's market share.
- The Meter product is generating revenue in Canada and has exceeded initial conservative projections for user adoption.
Negative Points
- The renewal of the Universal deal is still under negotiation, with terms yet to be decided.
- The company has paused its share buyback program to focus on investments in Meter and other growth opportunities.
- There is uncertainty regarding the adoption rate and market split between single and enterprise customers for Meter.
- Operating expenses may increase due to investments in marketing and development for Meter.
- The competitive environment for Meter includes larger companies with established charting platforms, posing a challenge for market penetration.
Q & A Highlights
Q: Has the Universal deal been renewed for another two years?
A: We have renewed it until the end of September and are currently in talks for further extension. The term is yet to be decided, but it will be from October 1 onwards. (Frederick Vandenberg, CEO)
Q: Why was the buyback not renewed despite being active over the last 12 months?
A: We paused the buyback to focus on the new product, Meter, which requires investment in marketing and development. We are evaluating our capital allocation to potentially grow both organically and inorganically. (Frederick Vandenberg, CEO)
Q: Are you expecting operational expenses to increase due to MTR marketing investments?
A: We are currently cash flow positive and will consider expanding spending if we see promising growth opportunities. We want to establish a run rate before making significant changes. (Frederick Vandenberg, CEO)
Q: Is MTR generating revenue in Canada, and how does it compare to the U.S. market?
A: MTR is generating revenue in Canada, initially at a low price to test market interest. We have increased the price as we expand tracking to U.S. stations, offering a competitive deal at $20-$25 per month. (Frederick Vandenberg, CEO)
Q: What are the synergies between Meter and Play MPE?
A: Both products share the same customer base, allowing for cross-marketing and operational cost overlaps. The data analytics from Meter can enhance Play MPE's offerings, potentially converting Meter customers into Play MPE users and vice versa. (Frederick Vandenberg, CEO)
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
