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Direct Digital Holdings Inc. (DRCT-14.51%) has submitted its Form 10-K filing for the fiscal year ended December 31, 2024.
The filing details the company's financial performance, showing a significant decrease in revenues to $62.3 million from $157.1 million in 2023. The decline is primarily attributed to a reduction in sell-side advertising revenue due to a temporary pause in connection with a major customer.
Cost of revenues decreased to $44.9 million from $119.5 million, reflecting lower media fees and data center costs associated with the reduced revenue.
Operating expenses were reported at $30.6 million, down from $39.8 million in the previous year, with reductions in compensation, taxes, benefits, and other expenses.
Net loss for the year was $19.9 million, compared to a net loss of $6.8 million in the prior year. The increase in net loss is mainly due to the decrease in revenue and the impact of the sell-side disruption.
The company reported an adjusted EBITDA of negative $9.3 million, a significant decline from the positive $2.4 million reported in 2023, reflecting the challenges faced in the year.
Direct Digital Holdings Inc. continues to focus on its strategy to expand its customer base and increase sales to existing customers, particularly in the buy-side advertising segment.
The company has taken several actions to address liquidity concerns, including a staff reduction, cost-saving measures, and an equity reserve facility to raise additional capital.
The filing also highlights the company's efforts to remediate previously identified material weaknesses in its internal controls over financial reporting.
Direct Digital Holdings Inc. acknowledges ongoing legal proceedings related to a defamatory article and a securities class action lawsuit, which the company is actively defending.
This content was summarized by generative artificial intelligence using public filings retrieved from SEC.gov. The original data was derived from the Direct Digital Holdings Inc. annual 10-K report dated March 28, 2025. To report an error, please email earnings@qz.com.