NEW YORK - Vimeo (NASDAQ: NASDAQ:VMEO) shares climbed 5.3% on the back of better-than-expected first-quarter results and an optimistic revenue outlook for the second quarter of 2024.
The video platform company reported an adjusted earnings per share (EPS) of $0.04, surpassing the analyst estimate of -$0.03. Revenue for the quarter was also above expectations at $104.91 million, compared to the consensus estimate of $102.87 million.
The company's revenue saw a modest 1% increase compared to the same quarter last year, driven by strong performance in its Vimeo Enterprise segment, which saw bookings and revenue jump by 47% and 60% respectively.
This growth was attributed to significant customer wins, including Delta, Nissan (OTC:NSANY), NATO, and 7-Eleven. However, these gains were partially offset by declines in Other bookings and revenue, which fell by 12% and 19% respectively, mainly due to product deprecations.
Vimeo's financial resilience was further highlighted by a reduction in both GAAP and adjusted operating expenses, which decreased by 5% and 10% year-over-year, contributing to a net income of $6 million and an adjusted EBITDA of $12 million.
The company's focus on rationalizing expenses has led to a reduction of more than $20 million in operating expenses compared to two years ago, underscoring its commitment to profitability.
Looking ahead, Vimeo provided second-quarter revenue guidance of $100 million, which is above the analyst consensus of $97.764 million. This optimistic outlook is supported by the company's strong first-quarter performance, which has bolstered confidence in achieving at least the lower end of its 2024 annual revenue guidance range of $385 to $400 million.
Philip Moyer, Vimeo's newly appointed CEO, expressed confidence in the company's direction, stating, "We believe our top line results demonstrate our model’s resilience and the enduring strength of our products."
He also emphasized the company's unwavering commitment to profitability while acknowledging the potential to reinvest in growth initiatives, particularly in the latter half of the year.
The positive market response to Vimeo's financial results and forward-looking statements reflects investor confidence in the company's strategic initiatives and financial health. With plans to act on a $50 million buyback authorization to minimize share dilution and a continued focus on product-led growth, Vimeo is poised to capitalize on the growing demand for video and AI integration in the industry.
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