v3.25.1
Note 9 - Segment Information
 3 Months Ended
Mar. 31, 2025
Notes to Financial Statements  
Segment Reporting Disclosure [Text Block]

9. Segment information

 

The Company identifies operating segments as components of an entity for which discrete financial information is available and are regularly reviewed by the Chief Executive Officer, who is the Company’s Chief Operating Decision Maker ("CODM"), who has final authority in making decisions regarding resource allocation and performance assessment. The profitability measure employed by CODM is earnings before interest, taxes, depreciation and amortization ("EBITDA"). The use of EBITDA as a financial metric provides management and investors with a clearer view of the core business performance and profitability, excluding the effects of financing and other non-operational expenses.

 

 

As of  March 31, 2025, the Company had three operating segments: a) "Fluent", which is Owned and Operated and Commerce Media Solutions revenue, b) "Call Solutions", and c) "AdParlor". The Company determined that there was one reportable segment, "Fluent," for the purposes of segment reporting. The Fluent reporting segment combines Fluent with the Call Solutions operating segment. This reporting unit works with advertisers to then bring consumers to their products through multiple media channels and earn revenue when a consumer completes an action as agreed upon with the advertisers. The "All Other" segment represents the operating results of AdParlor, LLC, which mainly performs media buying, and those businesses sold or in run-off, which are included for purposes of reconciliation of the respective balances below to the consolidated financial statements.

 

The Company determined its segments based on how revenue is earned as well as the agreements entered into with its advertisers. In addition, certain advertisers overlap within the different operating segments. Further, they are managed consistently with shared management.

 

As of  December 31, 2024, the Company adopted ASU 2023-07. Accordingly, the segment disclosures provided have been updated in accordance with the current presentation and accounting standard requirements. The significant expense categories and amounts align with the segment-level information that is regularly provided to and used by the CODM in evaluating performance and EBITDA profitability and were identified as a) cost of revenue b) salaries and benefits, c) professional fees, and d) IT and software.

 

The Company does not allocate certain shared expenses such as interest expense and other non-recurring items. The allocation methodology is regularly assessed, evaluated and subject to future changes.

 

Summarized financial information concerning the Company's segments for the three months ended March 31, 2025 and 2024 are shown in the following tables below, noting prior period amounts have been recast to conform to the Company's current period segment presentation:

 

  

Three Months Ended March 31,

  

Three Months Ended March 31,

 
  

2025

  

2024

 
  

Fluent

  

All Other

  

Total

  

Fluent

  

All Other

  

Total

 

Revenue(1):

                        

United States

 $35,905  $1,389  $37,294  $35,099  $8,022  $43,121 

International

  17,916   —   17,916   22,862   —   22,862 

Total segment revenue

 $53,821  $1,389  $55,210  $57,961  $8,022  $65,983 

Costs of revenue

                        

Cost of revenue (exclusive of depreciation and amortization)

  43,732   43   43,775   42,317   5,031   47,348 
                         

Costs and expenses:

                        

Salaries and benefits

  7,689   1,117   8,806   8,857   3,194   12,051 

Professional fees

  2,159   82   2,241   2,084   265   2,349 

IT and software

  1,186   92   1,278   980   241   1,221 

Other segment items (2)

  3,333   392   3,725   3,525   871   4,396 

EBITDA

 $(4,278) $(337) $(4,615) $198  $(1,580) $(1,382)

Depreciation and amortization

  2,406   55   2,461   2,088   483   2,571 

Loss from operations

 $(6,684) $(392) $(7,076) $(1,890) $(2,063) $(3,953)
                         

Reconciliation of profit or loss

                        

Interest Expense

          (880)          (1,415)

Fair value adjustment of Convertible Notes with related parties

          (80)          — 

Loss on early extinguishment of debt

          —           — 

Loss before income taxes

         $(8,036)         $(5,368)

(1) Revenue aggregation is based upon location of the customer.

(2) Balance includes sales and marketing expense, travel and entertainment expense, office overhead, restructuring and severance, goodwill impairment and impairment of intangible assets, and other operating costs.

 

  

March 31,

  

December 31,

 
  

2025

  

2024

 

Total assets:

        

Fluent

 $68,417  $84,373 

All Other

  9,077   9,244 

Total assets

 $77,494  $93,617 

As of March 31, 2025, long-lived assets are all located in the United States.

 

For the three months ended  March 31, 2025, 17.8% of the Company's consolidated revenue was earned from customers located in Israel.