- VerticalScope Holdings (TSX: FORA; OTCQX: VFORF) revises its 2025 outlook due to significant early-year challenges.
- Anticipates Adjusted EBITDA of US$21-24 million and Free Cash Flow of US$20-22 million in 2025.
- Completed four acquisitions worth US$7.3 million year-to-date, despite market headwinds.
VerticalScope Holdings Inc. (TSX: FORA; OTCQX: VFORF), a Toronto-based technology company, has released a revised business outlook for 2025, highlighting significant early-year challenges. The company attributes these challenges to changes in video advertising classification and a Google core algorithm update in March 2025. These developments have led to reduced bidder activity and lower costs per thousand impressions (CPMs), causing a decline in video ad revenue for the first quarter of 2025.
Additionally, the March algorithm update by Google has resulted in approximately a 10% decline in monthly active users (MAUs), impacting the traffic to VerticalScope's communities. While the company is working on recovery strategies, the timeline for traffic recovery remains uncertain and may span several quarters.
Despite these challenges, VerticalScope projects full-year 2025 Adjusted EBITDA of US$21-24 million and Free Cash Flow of US$20-22 million, with a Free Cash Flow conversion rate of 85% or higher. The company has also completed four acquisitions valued at US$7.3 million so far in 2025 and continues to invest in AI-driven products such as AI-powered translations and enhanced search experiences within its FORA platform.
VerticalScope aims to maintain a leverage ratio between 1.0-1.5x throughout 2025, reflecting a disciplined capital deployment strategy. Founder and CEO Rob Laidlaw expressed confidence in the company's ability to adapt to market dynamics, emphasizing that their focus remains on executing the product roadmap and delivering long-term value to shareholders.
