Cineverse Q4 2025 Earnings Call Transcript

Quartr
Provided by Quartr
June 27, 2025

Key Takeaways

  • In Q4, Cineverse delivered $15.6M in revenue (up 58% YoY), net income of $0.9M and adjusted EBITDA of $4M, beating analyst estimates across all key metrics.
  • Management implemented a strategic reorganization by forming a dedicated Synaverse Technology Group and a new theatrical motion pictures division to drive AI innovation and low-risk film releases.
  • The company announced three upcoming wide-release films—The Toxic Avenger, Silent Night Deadly Night and Return to Silent Hill—all with sub-$5M investments and favorable economics targeting strong box-office returns.
  • Cineverse’s MatchPoint end-to-end media supply-chain platform is under evaluation by major studios, including a pilot with one studio potentially generating mid-7-figure annual revenue.
  • The Cineverse Podcast Network grew revenues by 57% YoY, now hosts 62 shows with a direct ad sales team, securing premium CPMs and mid-6-figure brand sponsorships.
AI Generated. May Contain Errors.
Earnings Conference Call
Cineverse Q4 2025
00:00 / 00:00

There are 8 speakers on the call.

Operator

Good day, everyone. Welcome to Cineverse's Fourth Quarter and Fiscal Year twenty twenty five Financial Results Conference Call. My name is Emily, and I will be your operator today. Currently, all participants are in a listen only mode. We will have a question and answer session following management's prepared remarks.

Operator

Please note that this call is being recorded. I would now like to turn the call over to your host, Gary Lofredo, Chief Legal Officer, Secretary and Senior Advisor for Cineverse. Please go ahead.

Speaker 1

Good morning, everyone. Thank you for joining us for Cineverse's fourth quarter and fiscal year twenty twenty five financial results call. The press release announcing Synaverse's results for the fiscal fourth quarter and year ended 03/31/2025 is available at the Investors section of the company's website at www.synaverse.com. A replay of this broadcast will also be made available at Cinneverse's website after the conclusion of this call. Before we begin, I would like to point out that certain statements made on today's call may contain forward looking statements.

Speaker 1

These statements are based on management's current expectations and are subject to risks, uncertainties and assumptions. The company's periodic reports that are filed with the SEC describe potential risks and uncertainties that could cause the company's business and financial results to differ materially from these forward looking statements. All the information presented on this call is as of today, 06/27/2025, and Cineverse does not assume any obligation to update any of these forward looking statements except as required by law. In addition, certain financial information presented in this call represent non GAAP financial measures, and we encourage you to read our disclosures and the reconciliation tables to applicable GAAP measures in our earnings release carefully as you consider these metrics. I'm Gary Lofredo, Chief Legal Officer, Secretary and Senior Advisor at Synaverse.

Speaker 1

With me today are Chris McGurk, Chairman and CEO Eric Opeka, President and Chief Strategy Officer Tony Wiedor, President of Technology and Chief Product Officer Mark Lindsay, Chief Financial Officer and Mark Torres, Chief People Officer, all of whom will be available for questions following the prepared remarks. On today's call, Chris will briefly discuss our fourth quarter and fiscal year twenty twenty five financial highlights, the latest operational developments, outlook and long term growth strategy. Mark will follow with a review of our financial results for the fourth quarter and fiscal year. Eric will provide some details on our streaming business results and operating initiatives. And Tony will provide updates on our technology initiatives before opening the floor for questions.

Speaker 1

As the market opens at 09:30 a. M. This morning, we would like to conclude our comments and Q and A by that time. I will now turn the call over to Chris McGurk to begin.

Speaker 2

Thanks, Gary, and thanks, everyone, for joining us today. As you recall, in February, we reported our third quarter results. That quarter was the best in the company's history with over $41,000,000 in total revenues, an increase of $27,500,000 from the prior year quarter. And we also recorded net income of $7,200,000 a $9,900,000 increase from the prior year. And we've continued that very strong financial and business momentum in our fourth fiscal quarter, generating impressive growth in all our financial performance measures and beating consensus analyst guidance on all key metrics.

Speaker 2

In the quarter, we generated total revenue of $15,600,000 a $5,700,000 or 58% increase over the prior year. Net income was $858,000 a $15,500,000 increase over the prior year. Adjusted EBITDA was $4,000,000 a $2,400,000 or 158 percent increase over the prior year quarter. Total direct operating margin was 5855%, well above our stated margin target of 45% to 50%. Our full year fiscal twenty twenty five results were equally impressive.

Speaker 2

Total full year revenues increased by 59% to $78,200,000 Total full year net income was $3,800,000 and total full year adjusted EBITDA was $13,900,000 a $9,500,000 or 216% increase over last year. These strong results were driven by growth across all the company's key lines of business, particularly streaming, digital and podcast revenues, but most importantly, by the unprecedented success of Terrifier three, the most successful unrated film release of all time. Our goal now is to build a high growth, high profit, low risk, year round wide theatrical releasing business by following the same acquisition releasing and marketing blueprint that works so well in the Terrifier movies and astonish the entertainment industry. I will speak more about that in just a minute, and Eric will go into much more detail about all the operating successes and new initiatives we've been pursuing across our other lines of business. But first, let me speak about an important reorganization we just implemented.

Speaker 2

First, to rapidly capture the growth and financial upside of our most important underlying asset, our proprietary streaming, content management and AI technology, we have set up our technology business as a separate business group and put Tony Huidor in charge as President and Chief Product Officer. This move was designed to focus all of Tony's considerable talent and experience in technology and business development on immediately turbocharging this business with a focus on match point licensing and the development of new AI based products such as CinnaSearch, our industry leading AI search tool that we developed with Google. Tony is not only tasked with keeping the company at the forefront of industry AI innovation, but also ensuring that Cineverse becomes the first truly AI forward entertainment company in every operating process across every function of the company. In a few minutes, Tony will speak about all these key technology initiatives and the strong progress we're making in the marketplace with our Matchpoint and AI products. Second, we also reorganized our entertainment content business to create a dedicated theatrical motion pictures division.

Speaker 2

Yolanda Macias is now the company's Chief Motion Pictures Officer. In this role, Yolanda will focus 100% of her considerable experience and expertise to leverage the success of Terrifier two and three by building and releasing a wide release slate of theatrical movies that are well poised to successfully follow the Terrifier blueprint. We believe this business, given our unique new media assets and releasing formula, can be a major potential source of ongoing value creation for the company. We've already made great progress in this area based on the high potential slate of franchise IP properties we have secured for our release lineup over the remainder of this fiscal year, which I will describe in more detail now. Our next franchise release is The Toxic Avenger, a contemporary rendering of the classic trauma horror comic.

Speaker 2

The film was produced by major studio Legendary Films, which counts the tremendously successful Doom movies and Godzilla versus Kong among its recent mega hits. The film was directed by Macon Blair and stars Peter Dinklage, Kevin Bacon, and Elijah Wood. We have domestic rights for the film in perpetuity, and we'll be releasing it on August 29. Like Terrifier three, our all in cash investment in this film for acquisition and release marketing will be less than $5,000,000 However, it's important to note that this film will generate approximately the same level of financial return to Cineverse as Terrifier three if it performs at only half of Terrifier's box office level given the parameters of the economic deal we made in the film. Additionally, our lifetime box office breakeven on the film is well below $10,000,000 underscoring again the favorable risk reward profile of this property.

Speaker 2

And the film is very well made, directed and acted and currently has a 92% positive score on review aggregator, Rotten Tomatoes. Like Terrifier two and three, it will be an unrated release. After that, on December 12, we will be releasing Silent Night, Deadly Night, a reinterpretation of the classic controversial Christmas horror film that was banned from theaters years ago. We are releasing the film domestically and have partnered with international entertainment powerhouse Studio Canal, which is releasing it overseas. The film has finished principal photography and is currently in post production.

Speaker 2

Total acquisition and releasing investment with this film will also be below $5,000,000 Next up will be Return to Silent Hill, the latest film installment of the enormously successful and popular video game horror franchise, which will be released on 01/23/2026. This film will also carry a total investment of less than $5,000,000 So we will have at least three wide release films in this current fiscal year, all with investments of less than $5,000,000 all based on very well known franchise IP, all with very specific and reachable fan bases and all perfectly poised to leverage the unique set of assets we have built at Cineverse, our streaming channel, our podcast network, our social media platforms, our AI based research tools, our targeted ad sales technology, and to use them all to follow the blueprint that was so successful empowering the performance of the Terrifier movies. Expect more wide release film announcements in the next few months as we build our slate for fiscal year twenty twenty six. In addition, we continue to generate significant new advertising businesses by other studios using our ecosystem to market their theatrical releases as well. Yolanda will give a detailed update on all this on our next earnings call in August.

Speaker 2

And with that, I'll turn things over to Mark for a financial update. Mark?

Speaker 1

Operator, I don't think we can hear Mark.

Operator

Apologies, Mark. We are unable to hear you. If I could please ask you to check that you are not on mute.

Speaker 3

Hello. Can you hear me?

Speaker 4

Yes. Yes.

Speaker 1

Was just

Speaker 4

Here you go.

Speaker 3

Sorry, guys. So sorry. Thank you, Chris. As Chris noted, last quarter was a record quarter for us and we have been able to follow that up with a very strong quarter, which is seasonally our toughest quarter in our fiscal year. We were able to beat analyst consensus estimates for revenue, net income, diluted EPS and adjusted EBITDA for both the fourth quarter and the full year.

Speaker 3

For the quarter, we reported revenues of $15,600,000 compared to $9,900,000 for the same quarter last year or a 58% increase. Net income and adjusted EBITDA were $900,000 and $4,000,000 respectively for the quarter, reflecting significant improvements over the prior year quarter. Again, strong results for a seasonally low quarter, especially considering the depressed direct and programmatic advertising environment in the first quarter, which is a direct result of companies pulling back on their discretionary advertising spend due to the ever changing tariff environment. Our direct operating margin for the quarter was 55%, which is above our previously issued guidance of 45% to 50%. Our improved operating margin is a direct result of our cost optimization initiatives implemented over the last twelve to eighteen months, as well as our ability to grow revenues while controlling variable costs.

Speaker 3

We expect our direct operating margin in future quarters to remain in the 45% to 50% range. SG and A expenses for the quarter were $5,400,000 a decrease of $1,400,000 compared to the prior year quarter and 35% of revenues, a material improvement from 69% in the prior year. As I stated last quarter, we expect to continue to see our SG and A expenses decline as a percentage of revenues as we continue to focus on top line revenue growth while maintaining an efficient cost structure, bolstered by our ability to offshore operations to our Synaverse India location. Had $13,900,000 in cash and cash equivalents on as of 03/31/2025, with $0 outstanding on our $12,500,000 working capital facility. In addition, as of 03/31/2025, we have a working capital surplus of $3,600,000 continuing to reflect our improving financial position over the last twelve to eighteen months.

Speaker 3

For the year, our net cash provided by operations was $18,500,000 a $29,100,000 improvement over the prior year. Finally, with a strong fourth quarter and record revenue for the full year and a $40,000,000 valuation for our content library portfolio, which is almost entirely off balance sheet, we continue to believe that our stock price is undervalued with significant upside based on yesterday's closing stock price of $4.18 per share. With that, I'll turn the floor over to Eric to discuss our operating and strategic growth initiatives.

Speaker 5

Thanks, Mark. I'd like to spend a few minutes reviewing our platform businesses and growth initiatives distribution, streaming, advertising and podcasting. So let's start with our distribution and content licensing businesses. This past quarter continued to be a solid one for Terrifier three on the ancillary side. Transactional and home entertainment revenues continued to exceed expectations.

Speaker 5

And during the quarter, we closed several windows of licensing deals with both Amazon and Peacock for the film. Compellingly, we were able to preserve a window on our own services while maintaining market value licenses on third parties. This concurrent windowing approach not only maximizes revenue, but enables us to continue to grow our streaming services as well. Since the home premiere of t three, ScreenBlock's subscribers have grown 31% while preserving valuable third party license revenues in the mid 7 figure range over the next eighteen months. We also expanded our footprint with major fast channel launches on Google TV FreePlay, international rollout of our flagship brands, including Dog Whisperer, and broader domestic distribution as well.

Speaker 5

As noted in the earnings release, we closed several traditional content licensing deals across genres and saw a meaningful uptick in our catalog revenues as well. Our team also announced new podcast licensing agreements and content expansions with the Cineverse Podcast Network continuing to grow rapidly, thanks to a more diverse content slate and increased advertiser demand. We now have 62 current shows and four new original series in development slated for release in the current fiscal year. Podcast revenues were up 57% over the prior year due to the rapid expansion of our slate and the impact of our ad sales strategy. We think we can maintain this robot robust rate of growth as we scale up the current series and ad efforts.

Speaker 5

On the comedy front, we're making major progress with our partner Wits, as recently announced, the team behind the Stan Comedy Club in New York City and other major ventures in comedy. We're seeing strong early interest from brands and agencies, and we'll be announcing our inaugural content lineup this midsummer. We currently have a dozen new shows in the works, and we'll be announcing the slate later this summer. Comedy remains the largest and most monetizable podcast category in The U. S, and it represents over 23% of all podcast listening according to Edison.

Speaker 5

We're also exploring other emerging segments like health, wellness and family, where brand demand is accelerating, but there's a real lack of scale in the market. Let's discuss our streaming channels business. Our platforms delivered strong engagement in Q4 with over three point two billion minutes streamed across our owned and operated services, up 45% over the prior year. Subscription revenues grew meaningfully, and we saw a 4% year over year increase in subscribers, bringing our total across the portfolio to approximately 1,420,000. This was fueled by continued momentum from ScreenBox, which now ranks among the top four services in North America, and from our new Cineverse channel on Amazon, which has shown significant subscriber growth and has been growing at 30% per month since launch.

Speaker 5

We plan on expanding this platform beyond Amazon in the coming quarters and believe it will become one of our top streaming services over time, especially with access to the high caliber of wide and specialty theatrical programming that we're now releasing. In addition to Cineverse, we now have four flagship services that have scale potential, Screenbox, Dove, FanDoor, and MidnightPulp. These platforms make up the bulk of our subscriber base, and we're gonna focus our investments and growth on these four properties in the short to midterm. Our genre specific and movie centric model not only supports subscription growth, but it acts as a flywheel that supports our theatrical and ancillary businesses as well. On the fast front, while we continue to grow viewership as noted, we've seen a glut of supply with huge growth in available competitive channels from studios outstripping the audience growth in the market.

Speaker 5

This factor has put some pressure on CPMs and fill rates for open market programmatic in the short to midterm combined with the macro environment as market described. We think over the long term, the market will absorb this oversupply. But as we support and maintain this channel base during this period, we're focusing our efforts in the ad space more on direct sales, our platform c three sixty, and on private marketplace deals. And that's been a good turn for us. On the direct advertising front, Cineverse continues to become a must buy destination for entertainment marketers.

Speaker 5

We now work with four of the top five movie studios and all major indies on wide release campaigns and have added several new key brand partners in q four, including Sony Pictures, Expedia, Hulu, Display, Warner Brothers, and Rocket Money. We've expanded this list to include Progressive, ZipRecruiter, Universal Pictures, Mint Mobile and more in the current quarter. Unlike competitors that are focused exclusively on CTV, given our brands and platforms, we offer a full three sixty degree strategy that includes CTV, mobile, display, podcasts and live events. This holistic offering provides superior outcomes for advertisers and allows us to command more strategic partnerships. While programmatic remains under pressure, our performance in direct and PMP channels continues to outperform budgetary benchmarks.

Speaker 5

C360, our proprietary ad platform, remains a major focus as well. Q four marked our strongest quarter to date for the service with year over year revenue growth of 290%. Importantly, c three sixty, now directly connected to The Trade Desk, will integrate with Synacor, our proprietary film data set comprising of millions of titles and billions of metadata points. We believe it's the most extensive domain specific data set for film in existence. Originally developed to support Cynosurech, it's now central to how we will revolutionize targeting in film advertising.

Speaker 5

So there'll be more on that to come in future quarters. Lastly, I want to talk about where we're headed in the near term. Podcasting continues to be one of our highest margin, fastest growing businesses. In addition to horror and comedy, we're gonna continue to invest in the new verticals as we discussed. We've already hired a dedicated podcast sales team and are considering further expansion given the early momentum we're already seeing in the space.

Speaker 5

We're also seeing strong growth in YouTube and social video. Across our brands, we now manage nearly 24,000,000 social followers. According to Nielsen, YouTube is the number one platform by watch time in all of media, commanding 13% of total TV viewing. And over the last nine months, with minimal to no CapEx investment, we've built a low 7 figure business placing our premium content into this space and believe that with our vast content library, there's significant growth and upside leveraging this number one streaming platform in the world. Additionally, we're exploring other high growth, high revenue formats like scripted micro dramas and short form content.

Speaker 5

According to Business Research Insights, the short form video market is currently at 34,000,000,000 globally and growing at 32% annually. With our scalable content pipeline, tech platforms and existing reach, we were well positioned to capture meaningful share of this emerging category in the near to midterm. And finally, on content licensing, both traditional and AI based remains a key focus. Our theatrical slate will be the main driver of this with titles like Toxic Avenger, Silent Night, Deadly Night, and Silent Hill. We'll have a robust slate that will also drive value licensing value of our vast catalog.

Speaker 5

And given our focus on IP driven popular content that appeals to wide swaths of people and demos and not just postal audiences, we're in a strong position to secure an output deal with a major streaming company against our future releases. On the AI front, we're in numerous dialogues to license our content for AI training and expect to see traction on that front later this year. At every level, we're focused on high quality, high margin growth and maintaining the existing margins that we've painstakingly built. We're excited about where Universe is headed in fiscal year twenty six and beyond. With that, I'll turn the floor over to Tony to discuss our technology initiatives.

Speaker 6

Thank you, Eric. I'm excited to share an update on our technology business. As you know, the company recently announced a new organizational structure in which the company's technology assets were placed under a new division named Syniverse Technology Group. The underlying reason for this was to accelerate our sales effort by investing more resources to an area of the company where we hold tremendous value. As many of you know, over the past several years, we have announced various deals with several small channel operators and video distributors.

Speaker 6

These deals were intended to allow the company to walk before we run by putting MatchPoint through real world task before fully taking it to market as a SaaS product. We use these deals as a way to put MatchPoint through our hardening process where we can onboard real world clients to help us identify the areas that we needed to further improve. We have learned a lot from these deals and are grateful to our partners for helping us improve Matchpoint. With this work complete, Matchpoint has reached an advanced level of maturity with robust capabilities that finally allow us to target who we feel are the ideal customers, the major Hollywood studios and major media companies. With that, we now have a seasoned sales team that has extensive expertise in the media supply chain of the business as well as deep contact into the Hollywood community.

Speaker 6

These factors have allowed us to effectively reach the right decision makers at major Hollywood studios as well as key media companies and broadcast networks. We plan to present Match Point to every major studio before summer's end. In the last forty five days alone, we have presented Match Point to three major studios, two broadcast networks and a leading e commerce giant. The reception we have received has been glowing and frankly quite humbling. For so long, we have overestimated the pace of innovation underway across the entertainment industry.

Speaker 6

We now see how these large media conglomerates still struggle with the very basics of operating a major streaming business at scale. We have found that major studios and film distributors still rely on manual workflows, fragmented systems, a patchwork of external vendors and massive internal teams to deliver content, often taking weeks to release a single title. This is a result of these large media companies preferring to hire third party vendors to solve their operational problems rather than developing proprietary technology. This legacy way of doing business is no longer sustainable and requires a new approach. As a result, this places Matchpoint in a very unique position about offering a complete end to end media supply chain specifically developed for the video streaming era.

Speaker 6

Media companies are accustomed to using various vendors and when cobbled together offer an ad hoc solution that at best meet some of their needs, but

Speaker 2

not

Speaker 6

all. MatchPoint, on the other hand, has been specifically developed to meet all the needs of a modern streaming company, including many nuanced edge cases that most technology vendors don't understand nor can effectively solve. There is no comparable system in the market that can match our ability to deliver tens of thousands of titles per month with no human intervention. Knowing this is why Matchpoint has been so well received by large media companies. In addition, the company's new organizational structure of having a separate entertainment and technology division has eased any concerns of being a competitive threat.

Speaker 6

As a result, the steel gates have opened wide. Match Point is currently being evaluated as part of two RFPs that are underway. In addition, of the three major Hollywood studios that we have already presented Match Point to, one studio has fast tracked their evaluation processes moving forward with a pilot that should lead to a commercial trial. During this process, we will be required to integrate into their internal supply chain so that MatchPoint can serve as their content fulfillment solution for distributing their movie catalog worldwide. We anticipate that this implementation alone can result in upwards of mid 7 figure revenue for the company on an annual basis.

Speaker 6

Discussion with other studios and media companies have centered along similar lines. These media companies are under tremendous pressure to scale their streaming business, cut costs, reduce headcount and leverage AI for workflow efficiencies. As many of you know, these are all the areas in which Matchpoint excels. Moving forward, our strategy is to focus on selling MatchPoint Dispatch as a way to get into the door and establish a relationship where we can prove ourselves. These media companies are the ideal customers for our MatchPoint products such as Insights and Synesearch.

Speaker 6

Having Dispatch as our flagship product gives us a strategic advantage when pitching our suite of MatchPoint products. Moving on to SuicideSearch. As you all know, we recently announced that we completed development of SuicideSearch. We are proud of the progress we have made and are extremely proud of this achievement we have achieved with no other company, media, or technology company has been able to do. The accuracy and breadth of the content recommendations that one receives via Asuna Search are far superior to anything else in the market.

Speaker 6

Although Google and OpenAI can generate suitable results on their own, their understanding of cinema is broad but shallow. Google and OpenAI lack a true understanding of the intrinsic nature of a film. This is where CineSearch excels and provides us with the depth of understanding that large AI model black. Moving forward, CineSearch will be licensed as a full product offering. In addition, we will license CineCore as a standalone dataset.

Speaker 6

We are excited to bring SynaSearch to market at a time when the streaming industry continues to suffer from poor user experience tied to weak search capabilities and inadequate content recommendations. We feel we have a competitive advantage and maintain a head start of several years above any of our competitors. Lastly, I want to talk about the role that AI will play in the future of Syniverse. For some time, we have been strong proponents of AI and have leveraged AI for years as a means to make Match Point more efficient and to keep help streamline our internal operations. Given the success we have seen with leveraging AI, we have kicked off an internal initiative to fully transform the entire company and fulfill our vision of becoming a next generation studio.

Speaker 6

We envision a future where each department is utilizing agentic AI for automation and to better scale the department's output. Our goal is to create an internal network of AI agents that communicate directly across every department so that we can maximize efficiencies across departments and further streamline how the company operates. Lastly, we have additional products under development and excited to share more on that soon. With that, operator, let's open it up for q and a.

Operator

Thank you. We will now begin the question and answer session. Our first question today comes from Dan Kurnos with Benchmark. Please go ahead.

Speaker 7

Yes. Thanks. Good morning. I'll try to keep it tight for your request to finish up here. Look, just fantastic into the year.

Speaker 7

We've got wide releases the next three quarters coming out. I guess, Chris, high level, just if you guys are successful or see early signs of success, how much more are you willing to lean in? And I know Eric kind of intimated that you're talking with some of the streamers, but how do we think about pay windows and licensing opportunities, especially for

Speaker 4

the licenses that you own?

Speaker 2

Yes. I think as we continue to fill out our slate, as Eric said, our we really have an overriding objective to to to set up a a payout with you, and we've started some discussions in that regard. I think what you'll see over the next few months is we'll be announcing more films, you know, that are similar to the three the four actually, if you include Wolf Creek that we we have in our release slate right now. And it'll also be expanding, you know, from our focus on horror into family films, another area that we had great strength in the past. And also, we're looking at more of a fantasy film as well and actually some black cinema content and comedy as as Eric mentioned.

Speaker 2

And I think once we put those pieces into our release slate, I think, you know, that's when we're we'll we'll get really serious about negotiating a a pay deal.

Speaker 7

And just on the profitability because it really matters. Like it was great in the quarter. You've I don't want to lose sight of the offshoring. I know that Mark in his comments said sort of 45%, 50% op margin. You crushed it this quarter with north of that.

Speaker 7

How do we think about it in quarters where you have a successful owned license film for wide release? And is there any chance that that margin could creep up over time?

Speaker 2

Yeah. I forget what the margin was, you know, in our last quarter. Maybe Mark can Mark can mention that. But I think we we you know, with Terrifier in in the market, we put up a really, really solid operating margin. So, you know, we feel good about the 55% number that we we put up, and and we we feel really good that we'll meet or exceed our operating margin target of 45% to 50% going forward.

Operator

Thank you. Our next question comes from Brian Kislinger with Alliance Global Partners. Brian, please go ahead.

Speaker 4

Great. Thanks so much. Great to hear about all the great details on the slate of movies. So I want to focus on some other growth areas. I'm hoping you can frame for investors how to think about in a search and match point with Tony's comments, how should we think about maybe the pipeline of opportunities?

Speaker 4

What do deal sizes look like? And maybe when should we expect this will have a significant impact on your overall results?

Speaker 2

Thanks, Brian. I'll I'll let Eric and Tony respond to that.

Speaker 5

That's all all for I'll frame the the top line. So I think as Tony as Tony mentioned, and I'll let Tony go into the into more detail here. I think as it relates to the overall sales pipeline, the the opportunity set of the companies we have, we're we're now focused more on the enterprise side in the future. In the past, we had been focused on smaller entities as more of a proof of concept. You know, those are those those kinds of entities are are pretty small.

Speaker 5

It takes a lot of them to generate meaningful revenue. So they're good for testing, but they're not really efficient for scaling the business. Tony, why don't you detail sort of the opportunities that generally in terms of the number of properties in the pipeline, what do you think the average deal size could end up being?

Speaker 6

Sure. Thanks, Eric. Yes. I would say, as Eric pointed out, we were really focused on these on small operators. We have one shot to come to market.

Speaker 6

We didn't want to risk it, so we aim for smaller operators so that we can learn what needed to be fixed and and get everything right before we took it to the big media companies. You know, of the five major studios, I would say, on average, each of those studios is probably 5,000,000 and up. It really depends on whether they use the platform for domestic distribution or worldwide. The partner that we're currently working towards a pilot, their initial expectation is we start with the back catalog launching worldwide. And then if this goes well, it can expand into other parts of the company, including their streaming service and then as well as their international operations.

Speaker 6

So that €5,000,000 can easily scale much higher. But so far, what our expectation is mid-seven figures and there's five of them. And as I said, we've presented to a good share of them so far. The reception has been very, very robust. After the big studios, we have obviously the big networks and the big media companies.

Speaker 6

And so there's plenty of other potential clients on that list. So we expect that over time within the next few years, we should have a very strong foothold within the business. And I think from there, that is where, as we say, land and expand. We sell them dispatch. We sell them Cynasearch.

Speaker 6

Sell them any of the other services or analytics. And these are all areas where all the big media companies are struggling. So we find ourselves in a very unique position and that we have technology that really sets us apart from everyone else.

Speaker 4

Great. That's wonderful. And just, I wanted to follow-up just on podcast. I don't know, what revenue was. The segments haven't been out yet.

Speaker 4

But with your push into Direct Hire, and I know one of the initiatives was to better monetize podcasting, maybe you can provide some more details on, again, direct direct sponsorship and sizes of those deals and how you, maybe frame also monetization of podcasting over the next, you know, twelve to eighteen months versus where it is today.

Speaker 5

Sure. Sure. So first of all, so just thinking about the monetization strategy here, it's really twofold. One is is, you know, if you think about our efforts in the podcast business, the big advantage that we have there is, you know, podcasts are new fresh content and new releases. So that provides, I think, a premium need for advertisers over fast channels that are predominant library.

Speaker 5

And we're actually seeing, podcast CPMs, higher, than CTV CPMs, sometimes by, you know, even $10 or more higher on a direct basis. And that just reflects, you know, the the quality and the value of the portfolio we're starting to put together. So number one, it's it's we think the portfolio we're building towards a more premium, higher quality. So our show you know, our focus is on on assembling shows that have, you know, half a million to a million monthly listeners at a minimum, per per podcast. I think that's very different for some of the other net networks out there that are kind of vacuuming up every every show, no matter how small or big it is.

Speaker 5

So that's number one, and that plays well with advertisers. Number two, you know, we're we're doing this on a direct basis, with in addition to bundling it, as I described during our commentary, we have we've hired up a a direct team. We hired some, some sellers out of out of the SiriusXM universe who are I would say, hit the ground running and doing quite well. So the average deal size we're getting as we're as we're getting larger brands like Progressive and others, can can go into the the low 6 figures per deal. That's not every deal.

Speaker 5

Know, you're doing mid five, deals quite consistently, for brands. But interestingly, we're starting to see bigger, more brand and less performance oriented, which I think is a really good space for us when you when you think about it from that perspective because, you know, brand branded tend to buy just in bigger packages than performance who who are testing. So as we kind of think about the the trajectory with our focus on more brand oriented larger advertisers, you know, given we were at a 100% programmatic last year, we think, you know, the the CPMs on the direct are are more than double. And given the velocity, you know, I think we could probably we could probably accelerate in the back half of the half of the year, to two x or more what we did last year. But that a lot of that is highly dependent, obviously, on macro conditions and other elements, how the ad market, you know, continues to play out.

Speaker 5

But so far, it's looking very solid, and we think just adding more salespeople, we could expand it even further.

Operator

Thank you. There are no further questions remaining. So I'll pass the conference back over to the management team for closing remarks.

Speaker 2

Yes, this is Chris. Thank you all for joining us today, and please feel free to reach out to Julie Milstead with any additional questions you might have. We look forward to speaking to you all again on our next quarterly call. Thank you very much.

Operator

That concludes today's conference call. Thank you for your participation. You may now disconnect your lines.

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