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Overactive Media Corp (OAM) reported its second-quarter 2025 financial results, showcasing a 26% increase in revenue year-over-year to $8.36 million, yet missing earnings expectations with an EPS of -$0.02. The company, currently valued at $35.53 million in market capitalization, posted a net loss despite robust revenue performance. According to InvestingPro data, the company has maintained impressive revenue growth of 59.77% over the last twelve months, suggesting strong business momentum. The stock saw a modest 1.25% increase in after-hours trading. The company’s strategic initiatives in global content expansion and cost management were highlighted as key drivers for future growth.
Key Takeaways
- Revenue grew by 26% year-over-year, reaching $8.36 million.
- EPS fell short of expectations at -$0.02.
- Operating expenses decreased by 11%, enhancing cost efficiency.
- Introduction of new products like Phoenix Club and Active Voices.
- Stock price increased by 1.25% in after-hours trading.
Company Performance
Overactive Media demonstrated solid revenue growth in Q2 2025, driven by its strategic focus on global content expansion and cost management. The company successfully reduced operating expenses by 11%, contributing to a healthier financial position despite the earnings miss. Notably, the esports market’s global reach and Overactive Media’s focus on multilingual content creation positioned the company favorably against competitors.
Financial Highlights
- Revenue: $8.36 million, up 26% year-over-year
- Earnings per share: -$0.02, missing expectations
- Operating expenses: $5.38 million, down 11%
- Gross profit: $4 million with a 48% gross margin
- Adjusted EBITDA loss: $1.02 million, improved from $1.23 million loss last year
Earnings vs. Forecast
Overactive Media’s earnings per share of -$0.02 fell below market expectations, reflecting a challenging quarter in terms of profitability. The revenue of $8.36 million, however, marked a robust 26% increase year-over-year, demonstrating strong top-line growth. The earnings miss was primarily due to continued investments in new products and strategic initiatives.
Market Reaction
Following the earnings announcement, Overactive Media’s stock saw a 1.25% increase in after-hours trading, closing at $0.405. This movement suggests a cautiously optimistic market response, as investors recognized the company’s revenue growth and cost management efforts despite the earnings miss. InvestingPro analysis indicates the stock has delivered remarkable returns, gaining 17.39% in the past week and 80% over the last year. The stock remains within its 52-week range of $0.185 to $0.435, with technical indicators suggesting overbought conditions. For deeper insights into OAM’s valuation and growth potential, investors can access comprehensive analysis through InvestingPro’s detailed research reports.
Outlook & Guidance
Looking ahead, Overactive Media expects higher-margin revenues in the second half of the year and plans to convert its North American sponsorship pipeline. The company aims to scale Active Voices from pilot to full launch and build recurring revenue streams, targeting growth in its fan base and creator network.
Executive Commentary
CEO Adam Adamu stated, "Q2 was a quarter of delivery," highlighting the company’s achievements in revenue growth and cost management. Neil Duffy, Chief Commercial Officer, emphasized the importance of Active Voices, saying, "Active Voices creates local language versions of content while keeping ownership and authenticity with its creator." Duffy also noted the company’s goal "to grow these channels and use them to deliver value to fans, to partners, and most importantly to shareholders."
Risks and Challenges
- Earnings volatility due to ongoing investments in new initiatives.
- Competitive pressures in the global esports market.
- Potential challenges in scaling new products like Active Voices.
- Dependence on successful conversion of sponsorship pipeline.
- Macro-economic conditions affecting discretionary spending in entertainment.
The earnings call did not include a Q&A session, leaving some analyst questions about future profitability and market expansion unanswered.
Full transcript - Overactive Media Corp (OAM) Q2 2025:
Conference Operator: Good day, everyone, and welcome to Overactive Media’s twenty twenty five Second Quarter Conference Call. At this time, participants are in a listen only mode. The conference call is being recorded and a replay of today’s call will be available on the Investor Relations section of Overactive Media’s website. It will remain posted there for the next thirty days. I will now hand the call over to Mr.
Babid Pedram, Investor Relations for Overactive Media for introductions and reading the safe harbor statement. Please go ahead, sir.
Babid Pedram, Investor Relations, Overactive Media: Thank you, Joanna, and good morning, everyone. Welcome to Overactive Media’s second quarter twenty twenty five earnings conference call. A copy of the company’s earnings press release is available on the Investor Relations section of our website at overactivemedia.com. With us on today’s call are Adam Adamo, Chief Executive Officer and Neil Duffy, Chief Commercial Officer of Americas. Today, we’ll review the highlights and financial results for the second quarter twenty twenty five and recent developments.
Unless otherwise specified, all amounts mentioned on today’s call are in Canadian dollars. Before we begin, I will read our cautionary note regarding forward looking information. Certain information to be discussed during the call contains forward looking statements within the meaning of applicable security laws, including, among others, statements concerning the company’s 2025 objectives, the company’s strategy to achieve those objectives, as well as statements with respect to management’s beliefs, plans, estimates, and intentions, and similar statements concerning anticipated future events, results, circumstances, performance, or expectations that are not historical facts. Such forward looking statements reflect management’s current beliefs and are based on information currently available to management and are subject to several significant risks and uncertainties that could cause actual results to differ materially from those anticipated. Also, our commentary today will include adjusted financial measures, which are non GAAP measures.
These should be considered a supplement, not a substitute for GAAP financial measures. Reconciliations between the two can be found in our MD and A, which is available on sedarplus.ca and our website. At this time, it is my pleasure to introduce Adam Adamu, Chief Executive Officer of Overactive Media. Adam, please go ahead.
Adam Adamu, Chief Executive Officer, Overactive Media: Good morning, everyone, and thank you for joining us. Q2 was a quarter of delivery. We broadened our commercial footprint and executed two major events, LEC On The Road in Madrid and CDL Championship Weekend in Canada. Both drove audience growth, strengthened partner demand and supported our agencies and content businesses. The financial results reflect that momentum.
Revenue grew 26% year over year to $8,360,000 and is up 30% year to date to 13,360,000.00 Operating expenses declined 11% to $5,380,000 showing disciplined cost control. Gross profit was $4,000,000 with a 48% gross margin versus 62% last year, reflecting a first half mix weighted towards events and agencies. We expect margins to improve in the second half as league revenue share, digital merchandise and Esports World Cup flows through. Adjusted EBITDA was a loss of $1,020,000 an improvement from a $1,230,000 loss last year. We closed the quarter with $5,100,000 in cash and positive working capital.
On execution, in Spain, Elysee On The Road drew 18,000 fans over two days and 348,000 peak concurrent viewers. In Canada, CDL Champs and Kitchener brought in 11,000 fans on-site and 353,000 peak viewers online. The first time the championship has been staged outside The U. S. We launched Phoenix Club, a new subscription loyalty program laying the groundwork for recurring revenue.
Competitively, MovieStar Koi captured the LEC spring title securing international births and strengthening the brand with fans worldwide. Looking forward, the second half is when our highest margin revenues are recognized. These revenues will rebalance the mix and support stronger profitability as we close the year. We’re also investing in the future. Earlier this month, I traveled to Shanghai to launch Active Voices at the China eSports Conference.
The global reception confirmed strong demand for a scalable solution that removes language barriers while keeping creators in control of their content and identity. This quarter showed progress on both financial and operational fronts And we believe the second half sets us up for our strongest year yet. With that, I’ll hand it over to Neil Duffy, our Chief Commercial Officer in The Americas to walk through the commercial pipeline and the rollout of active voices with creators, teams and agencies. Neil?
Neil Duffy, Chief Commercial Officer of Americas, Overactive Media: Thank you, Adam and good morning everyone. Q2 was a strong commercial quarter in both regions. In Europe, LEC on the road in Madrid, the first regular season LEC matches hosted by a team and MovieStar COI’s spring championship title delivered audience growth, stronger partner demand and real momentum. In North America, we staged the Call of Duty League Championship Weekend presented by Bell. The first Call of Duty World Championship held outside of The United States.
This event generated record ticket sales for Toronto Ultra and introduced new provincial and municipal partners. These outcomes drive sponsorship conversion, new content opportunities and direct to consumer growth. On partnerships, we recently added non endemic brands in North America, including Little Caesars Canada and StoneFire authentic flatbreads. We will see these begin to flow through in the third quarter. Our founding partner Bell renewed through 2027 extending telecom exclusivity in Canada.
The Bell agreement provides multi year commercial certainty, includes national media support, co branded content, fan activation and an always on digital campaign. It gives us a scaled partner to amplify programs and to support new initiatives such as multilingual content and product launches. Let me turn now to Active Voices, our newly announced AI powered language localization platform. The majority of content today is still published in a single language. This limits its reach.
There are at least 12 languages with over a 100,000,000 native speakers, the largest of which is Mandarin. Active Voices creates local language versions of content while keeping ownership and authenticity with its creator. We are well positioned for the rollout, starting with our own network of teams, events, agencies and co streamers. We introduced the platform in China, the world’s biggest market for gaming and eSports earlier this month, and we saw immediate interest from both creators and agencies. The pilot program is helping creators prioritize their markets, unlock their back catalog of content, and expand their monetization.
For brands, the value in activating the same sponsorship assets globally without having to rebuild assets or campaigns. For overactive, we expect that active voices can be a high margin recurring revenue stream that scales alongside our existing business lines. Looking ahead to the 2025, our focus is execution. We want to convert the North American sponsorship pipeline into integrated programs across events, creators and retail. We’re looking to scale active voices from pilot to launch with very clear success metrics driven by creator and regions.
We want to build on our event agency partnerships and digital MTX to carry momentum into 2026. We now have a global fan base of over 100,000,000. Teams competing at the highest level and a creator network that expands our reach and a language localization platform that can grow beyond language. Our goal is to grow these channels and use them to deliver value to fans, to partners, and most importantly to shareholders. Adam, back to you.
Adam Adamu, Chief Executive Officer, Overactive Media: Thanks, Neil. And thank you all for joining us today. Q2 showed our model working. Strong revenue growth, disciplined costs and major events delivered on both sides of The Atlantic. Looking ahead the second half is when our highest margin revenues comes through.
League share, MTX and Esports World Cup and when we begin to scale active voices from pilots to initial deployments. Our priorities are clear, convert the pipeline, expand recurring revenue and maintain cost discipline while investing where returns are strongest. This positions Overactive for our best year yet. Thank you again for your support. Operator, back to you.
Conference Operator: Ladies and gentlemen, this concludes today’s conference call. Thank you for participating. You may now disconnect. Have a good day.
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