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Azerion Group BV (AZRN) reported its financial results for the second quarter of 2025, showcasing strong revenue growth and significant improvements in EBITDA. The company emphasized its strategic focus on AI-driven advertising solutions, which contributed to its performance. Despite the positive financial results, Azerion’s stock saw a slight decline, reflecting a complex market reaction. According to InvestingPro data, the company’s stock has shown strong momentum with a 20.69% year-to-date return, though current analysis suggests the stock may be trading above its Fair Value.
Key Takeaways
- Q2 revenue increased by 6% to €147 million.
- Adjusted EBITDA for Q2 rose by 8% to €18.9 million.
- Azerion maintained its full-year 2025 guidance.
- The company is concentrating on AI-driven platform growth and potential debt refinancing.
- Stock price fell by 1.43% following the earnings report.
Company Performance
Azerion demonstrated solid performance in Q2 2025, with a 6% increase in revenue compared to the same period last year, building on its trailing twelve-month revenue growth of 7.18%. The company’s focus on AI-driven digital advertising platforms has positioned it as a leading player in the European market. Azerion’s strategic shift, including the sale of its Wow Games segment and discontinuation of premium games, has streamlined operations and bolstered profitability. However, InvestingPro analysis reveals some financial challenges, including a high debt-to-equity ratio of 7.96x and a current ratio of 0.8, indicating potential liquidity concerns.
Financial Highlights
- Revenue: €147 million, up 6% year-over-year.
- Adjusted EBITDA: €18.9 million, up 8%.
- EBITDA: €14 million, reflecting a 109% increase.
- Continuing operations revenue: €136 million, up 9%.
- Revenue per FTE: €147,000.
Outlook & Guidance
Azerion continues to focus on expanding its AI-driven platform, with plans for organic growth and potential mergers and acquisitions. The company maintained its full-year 2025 guidance, signaling confidence in its strategic initiatives. Azerion is also exploring debt refinancing options to support its growth ambitions.
Executive Commentary
CEO Umut Akpinar stated, "We are leaner, stronger, and more focused," highlighting the company’s streamlined operations and strategic focus on AI. CSO Sebastian Lussmann noted, "Digital advertising is run on technology, but still needs an immense amount of human work," emphasizing the balance between technology and human input in Azerion’s operations.
Risks and Challenges
- Market volatility: Fluctuations in the digital advertising market could impact Azerion’s revenue.
- Technological advancements: Rapid changes in AI technology require continuous innovation.
- Economic conditions: Broader economic factors in Europe may affect advertiser spending.
- Competition: Intense competition in the digital advertising sector could pressure margins.
Q&A
During the earnings call, analysts focused on Azerion’s AI strategy, particularly its impact on operational efficiency and scalability. The sale of the Wow Games segment was also discussed, with gains expected to be reflected in Q3 results. Executives highlighted strong EBITDA growth driven by operational discipline and recent acquisitions.
By concentrating on its AI-driven advertising platform and maintaining a strong local presence, Azerion aims to accelerate its top and bottom lines over the next 12 to 18 months. With a market capitalization of €191.82 million and analysts forecasting continued challenges in achieving profitability this year, investors seeking deeper insights can access the comprehensive Pro Research Report available exclusively on InvestingPro, covering all crucial aspects of Azerion’s financial health and growth potential.
Full transcript - Azerion Group BV (AZRN) Q2 2025:
Moderator/Operator: Good afternoon, and welcome to the Azurion Interim Financial Results Q2 ’20 twenty ’5. After the speakers’ remarks, there will be a question and answer session. Thank you. I’d now like to turn the call over to Ummoud Akpinar for welcome remarks.
Umut Akpinar, CEO, Azerion: Thank you very much. Good afternoon, everyone. I am Ummoud Akpinar, CEO of Azerion. I am here with my colleagues, Mrs. Julie Doran Ferat, our Chief Financial Officer.
Julie Doran Ferat, Chief Financial Officer, Azerion: Hello, everyone.
Umut Akpinar, CEO, Azerion: Thank you very much, Julie and Sebastian Lussmann, our Chief Strategy Officer. Hello, everyone. Good afternoon. We would like to welcome you to today’s webinar to present Azeriot’s Q2 and H1 twenty twenty five Interim Results. Before we start, I would like to take a moment to acknowledge the disclaimer.
And our forward looking statements. Thank you. Let’s please move on to the presentation. This has been a strong quarter for the company. We have continued to execute on our strategy, focusing on our core assets to deliver long term growth.
In Q2, we delivered solid 6% revenue growth for the group, resulting in a total revenue of €147,000,000 Our Q2 adjusted EBITDA grew 8% to €18,900,000 However, the metric I would like to highlight today is EBITDA, which more than doubled with an impressive 109% growth to €14,000,000 and €22,000,000 for the first semester. This clearly shows the positive effect of last year’s consolidation programs and our ongoing investments in AI. A key part of our strategy in recent quarters has been the simplification of our business. As part of that, we successfully completed the sale of Wow Games, the largest part of our premium game segment. Julie will give more details later on.
This divestment sharpens our focus on our core business, the digital advertising platform. Commercially, our platform had a record breaking quarter. We secured 34 new agencies and 84 new publishers. We also continued the successful integration of recent acquisitions like Anero, Captify, ProduPress and Worldpac Austria, which are already delivering promising results. I am pleased to report that thanks to these continued efforts, Azerion is leaner, stronger and more focused.
I would now like to hand over to Seb for an update on our strategy.
Sebastian Lussmann, Chief Strategy Officer, Azerion: Yes, thank you, Umut. Okay. As Umut also just referenced, we obviously had a significant project in the last few months where after initial contacts early in the year with Double Down Interactive, progressed into a negotiation and ultimately the sale of Wow Games. Now, Wow Games was a series of games around digital slot machines, no gambling, just a social casino with no payout. But most people there paid to play the game and as such, advertising wasn’t a big factor in the environment.
We started to manage this game for value a while back also when we sold the poker portfolio. And so when Double Down Interactive approached us, we were certainly interested in that conversation. And ultimately, the valuation we felt was right for Zirion. And, yeah, this game also had a few risk factors like future legislation on these topics and an aging user demographic that we were happy to be able to address as well with this divestment. Mostly though, by divesting in Wow games and furthermore discontinuing the entire premium game segment, we are now able to focus on the advertising business completely and in doing so, also clean up and save cost in the structure.
The advertising business is more of a scale business than premium games. So when we invest and focus more on growth in advertising, both the profit and the profit margins goes up, while premium games has a more linear profit model where our profit would increase but at similar margins. Azurion has grown a lot in recent years, but in advertising, there’s still a lot of room for growth and improvement. So with the full focus on the business line, expect to accelerate faster. That acceleration of the advertising platform in our minds will mostly come from AI.
As you know, we have been moving more and more into AI and multi cloud in recent months, And our platform is perfectly positioned to take advantage of that. Digital advertising is run on technology, of course, but the technology still needs an immense amount of human work to develop a media or channel strategy to come up with and create the ads, to configure the systems to know what, when and where to buy the media slots, to analyze how the campaign is doing, and then to optimize the campaign. All of that is currently done by expert operators. These people of course need to be paid and their time is limited. Now with our AI investments, we will increasingly automate the whole chain of bringing an advertising campaign to life, lowering the cost to operate them and increasing the quality as the systems can optimize much faster and more often than people get.
This will both increase our profitability and the results of those campaigns. At the same time, if you think about this smoothening and simplification of using the technology, it makes our platform also more accessible to customers with smaller and more local advertising budgets. Because as an advertiser, you no longer need unilever sized budgets, for instance, to run great effective omni channel media campaigns. And you’re also no longer limited to using only simple ads like on YouTube or Facebook. With Azurion, even out of home TV or radio advertising become accessible to every advertiser regardless of budget or expertise.
Our AI efforts will therefore drive efficiencies, but also increase our revenues over time as our SaaS platform becomes more and more seamless and used by all types of advertisers. With the divestment of Premium Games, we can focus both our energy and the additional money in the upcoming months in enhancing our products with AI and then bringing those products to market. We will do mostly organic investments where we invest in the efficiencies in our product development teams and our commercial capabilities, but also M and A in case we see opportunities to accelerate in this direction. Which brings me to the last slide about our outstanding bonds. Obviously, any future investment or growth is linked to financing.
And as you know, we have $265,000,000 bonds maturing October year. Given the recent divestments and the current market conditions, we are now evaluating whether this is a good time to refinance the debt early. Interest rates are favorable, which would decrease our cost significantly if we were to refinance. And we obviously also don’t want to refinance too close to the maturity date anyway. Therefore, we have engaged our long term partners at Pareto Securities and this time also D and B Carnegie to initiate preparations for a potential refinancing.
We are expecting them to approach credit investors in the near future to assess whether such a refinancing would be beneficial and feasible for the company in the short term. Healthy Q2 numbers, increasing efficiency and growth through AI, the proceeds of the Wild Games transaction and the potential refinancing at lower interest cost, all combined puts Mezirian in a very good position to accelerate both the top and the bottom line in the next twelve to eighteen months. And we’re really looking forward to making the most out of that. And I will update you, of course, on the topic again in the next few months. That’s it from my end this time.
Let me hand over the presentation to Julie, our CFO, to take you through the financials.
Julie Doran Ferat, Chief Financial Officer, Azerion: Thank you, Seb. Hello again, everyone. Let me present you q two and h one twenty five numbers starting with the group performance. Okay. So as both Umut and Sebastian mentioned, we are happy with the performance across the first half half year driven by a particularly strong second quarter.
For q two, revenue grew by 6% to €147,000,000. For the first half, revenue increased by 7% to €275,000,000. You can see here the split of the group between continuing and discontinued operations. The discontinued operations correspond to the segment premium games. This reclassification is a key part of our strategy to simplify our structure as largely explained by Spacer.
Following the announcement of the sales of war games, which represented the lion’s share of premium games and our intention to sell the remaining part of the segment, the PG segment has been reclassified as discontinued operation. Thus, on the other side, continuing operations of the group correspond to the combination of advertising platform and triple a game distribution, both part of the platform segment. This is definitely our core business, and let’s see it now more in detail. As said, our continuing operation consists of two things, advertising platform and triple a game distribution business. This is the engine of our goals.
This segment generates revenue mainly by displaying digital ads and by selling and distributing triple a games. In q two twenty five, the total revenue for our continuing operation was €136,000,000, an increase of 9% compared to q two last year. Total adjusted EBITDA for our continuing operations reached €16,000,000, a strong increase of 20%. This was driven by the revenue growth combined with cost efficiency efforts. But as we would highlight it, our focus on profitability is even most evident in our EBITDA results.
In q two, EBITDA has more than tripled for our core continuing business, growing from €2,000,000 to €11,000,000. As mentioned in the on the previous slide, the platform is the engine of our growth. This slide shows why as it demonstrates consistent and a regular growth quarter on quarter for the last four years, adding 66% to the top line in that time. This is driven by solid management of our direct sales channel, fueling higher margin sales. Now if you combine it with the integration of acquired company and the subsequent consolidation initiative, this has led to enhanced profitability reflected by 20% q two year on year growth in adjusted EBITDA as shown before.
You may also know that our disciplined focus on profitability has been a key theme. Specifically, we’ve seen the benefit of controlling personal costs while revenue is growing year on year. In the light blue line, you can see the FTE, and in the dark blue line, revenue per FTE that also follows the seasonality of our business. Revenue per FTE increased to 147 k euro. The increased profitability this quarter is a direct result of the integration and consultation effort also that we have undertaken.
So to summarize, a strong quarter that reflects our successful strategic realignment. We are disciplined, continuing our work to demonstrate our capacity to deliver sustainable growth. We divested war games in order to focus on the platform, which we consider to be more scalable with more potential growth. Our premium game segment came with stronger margins, which contributed both to the growth to the group and the investment in the platform, And this was the right time to shift completely to our platform strategy. Now we are concentrating our resources, and we clarified our positioning as an advertising led platform with a strong omnichannel offer supported by expertise in emerging formats such as CTV, DOH, and audio.
Given the performance of our advertising business and our sharpened strategic focus, we are confident in our outlook. That’s for our continuing operation. We maintain our guidance for the full year ’25, adjusted for the divestment of the discontinued operation. Now I would like to hand over to our head of investor relations, Andrew Bergman, for the q and a session.
Andrew Bergman, Head of Investor Relations, Azerion: Thank you, Julie. So, operator, can you please repeat the instructions for q and a, and we can get started?
Moderator/Operator: We will now move into our q and a session. If you would like to submit a question, please use the ask a questions tab on the right hand side of the webcast player. I will now hand over to Andrew Buchman for written questions.
Andrew Bergman, Head of Investor Relations, Azerion: Great. Thank you. So we’ve had a number of questions in. So the first one is up for Seb. So we’d like to hear more about the relevance of AI to the current business and the new AI business.
Sebastian Lussmann, Chief Strategy Officer, Azerion: Yeah. So I think I covered most of it already in the presentations. But first, we we made sure that we have an AI platform that we can work off, and we announced this in the last few months. And with that platform, we are now able to both support our own and our clients’ business. So starting with our own business, it means, as I said, we are using the AI more and more to streamline and optimize the products that we have.
Also, of course, we use the AI internally to streamline and optimize the, let’s say, the supporting and the back office services, finance and the operations. So doing a lot of work to make sure that the AI increasingly makes the running of our tools cheaper and more efficient. As I said also, that will open up opportunities for new types of clients that normally would cost a lot of money and energy from us to operate. But now with the AI, they can sort of self serve more easily. So our SaaS platform will continue to grow and tune towards these clients.
So that’s on client side. And of course, platform itself is at such a skill and level that we’re also helping suppliers and clients in our ecosystem to onboard on the platform. So for instance, for hosting or for using generic AI compute power, publishers and advertisers can use our platform to automate their own business and their own work on top of it. So quite a few topics there, efficiency, more easy clients work. We have the internal departments with you optimize and we sell platform to our clients and suppliers.
Andrew Bergman, Head of Investor Relations, Azerion: Great. Thanks. So second question is coming. You’ve answered some of this already, but there’s a couple of extensions. But so the business growth strategy.
So in simple terms, where do you see the growth going forward? For example, if we look at what products or features drive it, will you scale the bidding platform business essentially, or will you expand with other revenue streams?
Sebastian Lussmann, Chief Strategy Officer, Azerion: Yeah. So I think it’s importantly, we think the business that we offer as omnichannel means that we include in that offering certain channels like digital out of home and digital audio, which are not as simple as a banner or a video on Facebook or YouTube. Because if you think about it, if you walk through the train station and you see ads on the digital out of home display, it is hard for that display to know how many people walked past, how many people watched the ad, how many people then executed or did something with it. So these are channels that are not essentially simple. We as a, let’s say, one stop shop are already trying to help the big clients to make sense and to operate these kinds of campaigns in a simple way.
So that’s our core business already and that’s where we are also a little bit different from the others. We are in those cities where the advertisers are. We are local and we’re helping them to make make this work. And then with the AI on top of it, as this gets more and more easy to execute, smaller and smaller clients will also be able to use this for very local omnichannel campaigns. So I think that’s where a lot of growth is on the combination of more clients on our SaaS platform and using more of the channels that we are really good at with the digital audio, digital out of home and connected TV.
Andrew Bergman, Head of Investor Relations, Azerion: Okay. Great. So and then whilst you were asking that, another question came in. So do you think we’ll see some cost reductions as a result of the AI strategy?
Sebastian Lussmann, Chief Strategy Officer, Azerion: Absolutely. Absolutely. So if you if so let me give this as an example. So if if you think about buying media in the past, you could say, I’m buying from these 20 newspapers. And then if you make an Excel out of that, you have, like, 20 lines saying, I’m gonna spend 10 k with the the Guardian, 5 k with Financial Times, etcetera.
So this if you think about this Excel list, then in the digital advertising, this Excel list translates into a platform. So but the but the platform has the same 20 lines that says, okay. I want 10 k to be spent on banners on Financial Times, 10 k on The Guardian, etcetera. This someone needs to type in these lines. And then after a day, for instance, you got you start checking, are people watching the ad?
Are people clicking on it? They might, they might not, and you might wanna change the mix a little bit. Now this is all human work right now, so expensive. That means that if we can automate that more in an intelligent way, the cost of operating these products goes down. That means that our profit goes up.
And also at the same time, if you’re a client and our people need to optimize your product or your campaign, we probably do it every day or every week, but the AI will probably do it every minute or every second, you know. So the the the quality and the performance of the campaigns themselves will also go up. So you have a cost reduction in the operations of the platform while actually improving the quality of the product.
Andrew Bergman, Head of Investor Relations, Azerion: Great. Thank you. So we also had a couple of finance questions come in, Julie, specifically for you. So first one is, do the q two accounts already include the Wow games gain on sale?
Julie Doran Ferat, Chief Financial Officer, Azerion: Yeah. Good question. No. Indeed, the gain of sales will be taken into account in our q three results as the sale was effective during the month of July. The result will be shown in our p and l in a dedicated line, income from discontinued operation at the bottom of the p and l.
And the gain offset will be the difference between the cash consideration and the carrying amount.
Andrew Bergman, Head of Investor Relations, Azerion: Great. Thank you. And then next up, question really about the EBITDA. So how did you manage to more than double EBITDA in continuing operations this quarter?
Julie Doran Ferat, Chief Financial Officer, Azerion: Yeah. As I was explaining in the presentation, basically, through discipline control costs and also, as Sebastian mentioned, AI driven automation and also, obviously, the integration of the the acquisition. So, yeah, EBITDA rose 200% in h one for the continuing operation. And, this clearly demonstrates operational leverage and scalability in our business.
Sebastian Lussmann, Chief Strategy Officer, Azerion: So maybe maybe to add to that because we report for years already on the adjusted EBITDA. So what you what you often what you want basically is that the adjustments in the EBITDA turn into real EBITDA in the in the periods after. And I think this is what we’re also seeing. We haven’t done many acquisitions in the last year. So what you see now is that the adjustments that we did last year come back also as a as a true result in the in the year after.
So I think that’s also important point.
Andrew Bergman, Head of Investor Relations, Azerion: Then I think we’ve got one more question that’s come in. I think this is more of a strategy question. So I’ll put this one towards Umert. So what is the key reason why investors should back
Umut Akpinar, CEO, Azerion: Azirium today? That’s a really good question. I think if you look to the changing markets, the changing positions, then you could say we are one of the biggest in Europe, concentrating on Europe, being local, AI driven, probably we are the only one in Europe as a full AI platform using making use of all the different, let’s say, models which are available in the market. And of course, if you also listen to Sebast and Julie, that the improvement in the performance of the, let’s say, profitability of the company.
Andrew Bergman, Head of Investor Relations, Azerion: Great. All right. Thanks very much. Think that’s all the questions that we’ve got that we can answer today.
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