System1 misses Q3 revenue estimates

System1

05/11/2025 22:02

Overview

System1 Q3 revenue fell 31% yr/yr, missing analyst expectations

Adjusted gross profit margin rose to 59% from 42% yr/yr

Company's marketing business challenged by changes at Google, shifting focus to new product

Outlook

System1 will not provide financial guidance for Q4 2025 due to market uncertainties

Result Drivers

PRODUCTS SEGMENT - Shift towards higher-margin Products segment now majority of gross profit

AI INTEGRATION - AI integration across business improved gross margins and reduced operating expenses

GOOGLE CHALLENGES - Marketing business affected by changes at Google, shifting focus to new product

Key Details

Metric
Beat/Miss
Actual
Consensus Estimate
Q3 Revenue
Miss
$61.60 mln
$74.50 mln (1 Analyst)
Q3 Net Income
-$22 mln
Q3 Adjusted EBITDA
$9.90 mln
Q3 Adjusted Gross Profit
$36.10 mln
Q3 Gross Profit
$22.80 mln


Analyst Coverage

The one available analyst rating on the shares is "buy"

The average consensus recommendation for the it services & consulting peer group is "buy"

Wall Street's median 12-month price target for System1 Inc is $10.00, about 43.1% above its November 4 closing price of $5.69

Press Release: ID:nBw1PKSHHa

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)