Release Date: November 21, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Destiny Media Technologies Inc (DSNY, Financial) reported a revenue growth of 9.6% for the year, with Q4 revenue up by approximately 7.5%.
- The company launched a new product, MTR, in June, which is showing growth potential despite its current small contribution to total revenue.
- Destiny Media Technologies Inc (DSNY) has completed a year-long project to build out international capabilities for its largest client, which is expected to drive future growth.
- The company is focusing on expanding its Plan B ecosystem, which connects record labels to various promotional destinations, potentially increasing its market value.
- Efforts to improve marketing strategies, including global marketing preparations and rebranding, are beginning to positively impact revenue.
Negative Points
- EBITDA decreased to 577K, slightly down from the previous year, due to investments in product growth.
- The new MTR product currently contributes less than 0.2% to total revenue, indicating its early-stage development and limited immediate impact.
- The company is still in the process of negotiating a longer-term contract with Universal, currently operating on a month-to-month basis.
- International distribution, although growing, still represents less than 5% of total revenue, highlighting a need for further expansion.
- The company has not yet activated a share buyback program, despite considering it due to the current stock price.
Q & A Highlights
Q: What catalysts should investors look for to signal revenue growth above 10% for Destiny Media Technologies?
A: The CEO mentioned that the checkout feature being developed will be a game changer, allowing sales in markets where they currently have no sales. Improvements in marketing and a fully automated sales process are expected to drive growth. Additionally, MTR's revenue is improving and will see inflection points when they can sell to larger customers and expand globally.
Q: Should we expect the current revenue growth rate of 9-10% to continue, or will it increase?
A: The CEO expects growth in the independent record label segment, driven by improved marketing and international sales. Major labels may see smaller growth, but MTR, as a new product, should have a higher growth rate, impacting overall growth at certain inflection points.
Q: What portion of your business is now from labels distributing internationally?
A: International distributions are less than 5% of total revenue, but this area is growing, with a 67% increase last year. The company is focusing on expanding international lists and acquiring new markets, which should drive further growth.
Q: When will MTR significantly impact revenue?
A: MTR is already impacting revenue, albeit small. An inflection point is expected within the next six months when they can sell to larger clients. Further growth will come from international expansion and leveraging data from MTR.
Q: Is the company planning more share buybacks?
A: The CEO stated that the buyback is not currently active, but they are considering it given the stock price. Any decision will be announced if approved.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
