NEXN Stock Forecast & Price Target

Nexxen International Ltd experienced significant growth in its financial performance, with revenue from its data product rising by 102% year-over-year in the fourth quarter of FY24. The company's Connected TV (CTV) revenues reached a historic high of $37 million, reflecting an 86% year-over-year increase and accounting for 38% of total programmatic revenues, an increase from 23% in the previous year. Furthermore, Nexxen's strategic partnerships and enhanced sales execution contribute to an expected acceleration in revenue growth for FY24, supported by forecasts for continued increases in net revenue, adjusted EBITDA, and earnings per share through FY26.

Nexxen International Ltd faces significant financial challenges that contribute to a negative outlook, primarily stemming from a decline in its Performance segment revenue, which has contracted to about 10%-15% of 2021 net revenues, posing a headwind to overall revenue growth. Additionally, the company's workforce has been steadily reducing, from approximately 1,050 full-time equivalents (FTEs) in December 2022 to 854 FTEs by December 2024, indicating potential operational issues or cost-reduction strategies in response to market pressures. Furthermore, external factors such as increased competition, economic slowdown, and regulatory challenges surrounding data privacy and cookie deprecation exacerbate the risk of margin compression and further revenue declines, which could negatively affect the company's financial performance compared to its peers in the advertising technology sector.