Arena Group: Arena Group Posts Third Consecutive Profitable Quarter in Q1 2025 with $4.0 Million in Net Income

In This Article: Expansion of Brand-Building Activities and Competitive Publishing Model Fuel Positive Results Across Media Brands Management Posts Video Reviewing Quarterly Performance and Strategic Initiatives NEW YORK, May 15, 2025 --( BUSINESS WIRE )--The Arena Group Holdings, Inc. (NYSE American: AREN) ("Arena"), a technology platform and media company home to hundreds of media brands, including TheStreet, Parade , Men's Journal, Athlon Sports, Surfer, Powder and more today announced financial results for the three months ending March 31, 2025 ("Q1 2025"). Financial Highlights for Q1 2025: Quarterly revenue was $31.8 million compared to $28.9 million for Q1 2024. Net income was $4.0 million, or $0.08 per diluted share for Q1 2025, compared to a net loss of $103 million, including a $91 million loss from discontinued operations, or $3.91 per diluted share in Q1 2024. Income from continuing operations was $4.0 million in Q1 2025 compared to a loss from continuing operations of $12.7 million in Q1 2024, nearly a $17 million swing. Adjusted EBITDA for Q1 2025 was $9.7 million compared to negative Adjusted EBITDA of $848 thousand for Q1 2024. Financial Guidance for Q2 2025: Expected revenue of approximately $40-$45 million. Income from continuing operations of approximately $9 - $11 million. "In Q1 2025, we expanded our brand-building activities and competitive publishing model originally pioneered with Athlon Sports to more of our brands, and the results have exceeded expectations," said Paul Edmondson, CEO of The Arena Group. "Our entrepreneurial publishers have brought extraordinary energy and commitment to each brand. By aligning incentives with audience engagement, we've unlocked significant growth in our users, distribution and revenue. This performance reaffirms the power of our model." "Our goal is to leverage this new approach across our entire platform - driving traffic, higher CPMs, and increased revenue, while maintaining expense discipline to sustain profitability," Edmondson added. "With these results, we believe we are well-positioned to maintain profitability throughout 2025." Operational highlights: Athlon Sports : Audience traffic continues to grow significantly, with traffic increasing over 500% in Q1 2025 vs. Q1 2024. Our commitment to building a diversified revenue stream for Athlon continues to pay off with syndication and commerce revenue growing 730% year-over-year vs Q1 2024. Men's Journal 's traffic increased 282% over the previous month to 33.1 million page views in March 2025, the first month of competitive publishing. TheStreet : The financial brand reached record traffic levels in March 2025, delivering 80 million page views, up 100% vs March 2024. Parade : Digital traffic of Parade and Parade Pets also remained strong with more than 76 million monthly page views in Q1 2025 (up 2% vs Q4 2024). Arena recently acquired the travel brand, TravelHost . This iconic publication was founded in the mid-1960s and was the first in-room hotel magazine. It now provides travelers with local insights in 30+ markets. Arena intends to fully update and modernize the site and the brand's offerings. Video Message: Paul Edmondson, The Arena Group's CEO, has posted a video reviewing Arena's quarterly results and business strategy. The video addresses questions previously submitted by investors and other interested parties. It has been shared across Arena's social media channels and is available HERE . About The Arena Group The Arena Group (NYSE American: AREN) is an innovative technology platform and media company with a proven cutting-edge playbook that transforms media brands. Our unified technology platform empowers creators and publishers with tools to publish and monetize their content, while also leveraging quality journalism of anchor brands like TheStreet, Parade, Men's Journal, Athlon Sports, Surfer, Powder and more to build their businesses. The company aggregates content across a diverse portfolio of brands, reaching over 100 million users monthly. Visit us at thearenagroup.net and discover how we are revolutionizing the world of digital media. THE ARENA GROUP HOLDINGS, INC., AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS As of March 31, 2025 (unaudited) December 31, 2024 ($ in thousands, except share data) Assets Current assets: Cash and cash equivalents $ 2,902 $ 4,362 Accounts receivables, net 31,561 31,115 Prepayments and other current assets 4,682 4,757 Total current assets 39,145 40,234 Property and equipment, net 107 148 Operating lease right-of-use assets 2,260 2,340 Platform development, net 8,471 8,115 Acquired and other intangible assets, net 21,940 22,789 Other long term assets 147 151 Goodwill 42,575 42,575 Total assets 114,645 116,352 Liabilities, mezzanine equity and stockholders' deficiency Current liabilities: Accounts payable 3,615 4,844 Accrued expenses and other 10,802 10,990 Unearned revenue 5,230 6,349 Subscription refund liability 662 430 Operating lease liability, current portion 97 254 Liquidating damages payable 3,305 3,230 Current liabilities from discontinued operations 96,056 96,159 Total current liabilities 119,767 122,256 Unearned revenue, net of current portion 193 403 Operating lease liability, net of current portion 2,182 1,964 Deferred tax liabilities 833 802 Simplify loan 7,151 10,651 Debt 110,467 110,436 Total liabilities 240,593 246,512 Mezzanine equity: Series G redeemable and convertible preferred stock, $0.01 par value, $1,000 per share liquidation value and 1,800 shares designated; aggregate liquidation value: $168; Series G shares issued and outstanding: 168; common shares issuable upon conversion: 8,582 at December 31, 2024 and December 31, 2023 168 168 Total mezzanine equity 168 168 Stockholders' deficiency: Common stock, $0.01 par value, authorized 1,000,000,000 shares; issued and outstanding: 47,556,267 and 23,836,706 shares at December 31, 2024 and December 31, 2023, respectively 475 475 Additional paid-in capital 348,752 348,560 Accumulated deficit (475,343 ) (479,363 ) Total stockholders' deficiency (126,116 ) (130,328 ) Total liabilities, mezzanine equity and stockholders' deficiency $ 114,645 $ 116,352 THE ARENA GROUP HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS Three Months Ended March 31, 2025 2024 ($ in thousands, except share data) Revenue $ 31,815 $ 28,941 Cost of revenue (includes amortization of platform development and developed technology for 2024 and 2023 of $5,988 and $8,782, respectively) 16,146 20,008 Gross profit 15,669 8,933 Operating expenses Selling and marketing 2,134 4,564 General and administrative 5,283 10,135 Depreciation and amortization 890 987 Loss on impairment of assets - 1,198 Total operating expenses 8,307 16,884 Income (loss) from operations 7,362 (7,951 ) Other (expense) income Change in valuation of contingent consideration - (313 ) Interest expense, net (3,004 ) (4,339 ) Liquidated damages (75 ) (76 ) Total other expense (3,079 ) (4,728 ) Income (loss) before income taxes 4,283 (12,679 ) Income tax provision (286 ) (41 ) Income (loss) from continuing operations 3,997 (12,720 ) Income (loss) from discontinued operations, net of tax 23 (90,638 ) Net income (loss) $ 4,020 $ (103,358 ) Basic and diluted net income (loss) per common share: Continuing operations $ 0.08 $ (0.48 ) Discontinued operations - (3.43 ) Basic and diluted net income (loss) per common share $ 0.08 $ (3.91 ) Weighted average number of common shares outstanding Basic 47,458,076 26,443,764 Diluted 47,466,658 26,443,764 Use of Non-GAAP Financial Measures We report our financial results in accordance with generally accepted accounting principles in the United States of America ("GAAP"); however, management believes that certain non-GAAP financial measures provide users of our financial information with useful supplemental information that enables a better comparison of our performance across periods. We believe Adjusted EBITDA provides visibility to the underlying continuing operating performance by excluding the impact of certain items that are noncash in nature or not related to our core business operations. We calculate Adjusted EBITDA as net income (loss) as adjusted for loss from discontinued operations, with additional adjustments for (i) interest expense (net), (ii) income taxes, (iii) depreciation and amortization, (iv) stock-based compensation, (v) change in valuation of contingent consideration, (vi) liquidated damages, (vii) loss on impairment of assets, (viii) loss on sale of assets; (ix) employee retention credit, (x) employee restructuring payments, and (xi) professional and vendor fees. Our non-GAAP measure may not be comparable to similarly titled measures used by other companies, have limitations as an analytical tool, and should not be considered in isolation, or as a substitute for analysis of our operating results as reported under GAAP. Additionally, we do not consider our non-GAAP measures as superior to, or a substitute for, the equivalent measures calculated and presented in accordance with GAAP. Some of the limitations are that our presentation of Adjusted EBITDA: does not reflect interest expense and financing fees, or the cash required to service our debt, which reduces cash available to us; does not reflect income tax provision or benefit, which is a noncash income or expense; does not reflect depreciation and amortization expense and, although this is a noncash expense, the assets being depreciated may have to be replaced in the future, increasing our cash requirements; does not reflect stock-based compensation and, therefore, does not include all of our compensation costs; does not reflect the change in valuation of contingent consideration and, although this is a noncash income or expense, the change in the valuations each reporting period are not impacted by our actual business operations but is instead strongly tied to the change in the market value of our common stock; does not reflect li