Inuvo Posts 25% Growth in the Second Quarter 2025

Rhea-AI Summary

Inuvo (NYSE American: INUV) reported strong financial results for Q2 2025, with net revenue increasing 25% to $22.7 million compared to Q2 2024. The AI AdTech solutions provider demonstrated significant growth in the first half of 2025, with a 40% revenue increase to $49.4 million.

Key Q2 metrics include gross profit growth of 12% to $17.1 million, improved Adjusted EBITDA loss of $0.6 million (from $0.7 million), and a narrowed net loss of $1.5 million ($0.10 per share). The company maintains a strong financial position with $2.1 million in cash and an unused $10 million working capital facility with no debt.

Positive

• None.

Negative

• Gross margin declined to 75.4% from 84.0% year-over-year
• Operating expenses increased to $19.1M from $17.0M
• Continued net loss of $1.5M despite revenue growth
• Cash position relatively low at $2.1M
• Marketing costs increased to $14.1M from $12.4M

Insights

Financial Analyst

Inuvo shows strong 25% YoY growth with narrowing losses, but continues operating at a deficit despite five years of sustained growth.

Inuvo's Q2 2025 results demonstrate continued momentum with revenue up 25% to $22.7 million, marking the company's fifth consecutive year of double-digit growth, with a five-year CAGR of 24%. While this growth is impressive, it represents a significant deceleration from the 57% growth seen in previous quarters, which management attributes to seasonality.

The company's gross profit increased by 12% to $17.1 million, but gross margins contracted substantially from 84.0% to 75.4% due to product mix changes. This margin compression warrants attention as it suggests a shift toward lower-margin offerings within their AI AdTech solutions.

On the expense side, all operating cost categories increased year-over-year, with marketing costs rising to $14.1 million from $12.4 million. Despite these higher costs, Inuvo managed to narrow its net loss to $1.5 million ($0.10 per share) from $1.7 million ($0.12 per share) in Q2 2024. Adjusted EBITDA also improved slightly to a loss of $0.6 million from $0.7 million.

The six-month results paint an even more positive picture with 40% revenue growth and a 59% improvement in Adjusted EBITDA loss. The company also received a $606,000 payment from the IRS for employee retention credits, with $525,000 recognized as other income, helping to offset operating losses.

Inuvo's balance sheet shows $2.1 million in cash and no debt, with an unused $10 million working capital facility providing additional liquidity. This financial position gives the company some runway to continue investing in growth while working toward profitability, though the relatively small cash position compared to quarterly burn rate merits monitoring.

Management to host conference call at 4:15 PM ET, Thursday, August 7, 2025

LITTLE ROCK, Ark., Aug. 07, 2025 (GLOBE NEWSWIRE) -- Inuvo, Inc. (NYSE American: INUV), a leading provider of artificial intelligence AdTech solutions, today announced its financial results for the second quarter and six-month period ended June 30, 2025.

Second Quarter 2025 Highlights Compared to Second Quarter 2024:

• Net revenue increased 25% to $22.7 million from $18.2 million
• Gross profit increased 12% to $17.1 million
• Adjusted EBITDA improved 14% to a loss of $0.6 million from a loss of $0.7 million
• Net loss narrowed to $1.5 from $1.7 million and $0.10 from $0.12 per share

Six-Month 2025 Highlights Compared to Six-Month 2024:

• Net revenue increased 40% to $49.4 million from $35.2 million
• Gross profit increased 26% to $38.2 million from $30.2 million
• Adjusted EBITDA improved 59% to a loss of $0.7 million from a loss of $1.7 million
• Net loss narrowed to $2.8 million from $3.9 million and $0.19 from $0.28 per share

Richard Howe, CEO of Inuvo, commented, “We're pleased to report another quarter of strong double-digit revenue growth. Our growth rate for the first half of 2025 was 40%, contributing to a five-year sustained growth rate of 24% through Q2 2025. This quarter showcases the resilience and adaptability of our business. Although and as guided, sequential year-over-year growth declined from 57% to 24% due to seasonality, we continue to build on our multi-year trajectory of robust annual growth and operational improvements.”

Financial Results for the Second Quarter Ended June 30, 2025
Net revenue for the second quarter of 2025 totaled $22.7 million, a 25% increase compared to $18.2 million in the same period last year. Revenue from our two largest Platform clients and s from our two largest Agencies & Brands clients grew year-over-year. Cost of revenue was $5.6 million, up from $2.9 million in the second quarter of 2024, related to higher Platform revenue.

Gross profit increased 12% to $17.1 million, representing a gross margin of 75.4%, compared to $15.3 million and a gross margin of 84.0% in the second quarter of 2024. The lower gross margin year-over-year was primarily due to a change in product mix.

Operating expenses were $19.1 million compared to $17.0 million in the prior-year period. Operating expenses are composed of marketing costs, compensation and general & administrative expenses. For the three-month period ended June 30, 2025, all three categories of operating expense increased year-over-year.

Marketing costs were $14.1 million, up from $12.4 million in the second quarter of 2024, reflecting the higher expenses associated with Platform revenue growth. Compensation expenses were up due primarily to higher incentive accrual. General and administrative expenses were $260 thousand higher year-over-year primarily due to a reduction of the allowance for expected credit losses last year.

Finance expenses, net of interest income, were $18 thousand compared to $42 thousand in the same quarter last year.

Other income was approximately $560 thousand for the three months ended June 30, 2025. In June 2025, the Company received a second payment from the IRS totaling $606 thousand in connection with an employee retention credit filed in 2023. Of the total payment, $525 thousand was recognized in other Income.

Net loss for the quarter was $1.5 million, or $0.10 per basic and diluted share, compared to a net loss of $1.7 million, or $0.12 per share, in the second quarter of 2024.

Non-cash expenses including depreciation, amortization and stock-based compensation totaled $854 thousand in the second quarter.

Adjusted EBITDA improved to a loss of $0.6 million from a loss of $0.7 million in the year-ago period. (See reconciliation table below.)

Liquidity and Capital Resources
As of June 30, 2025, Inuvo had $2.1 million in cash and cash equivalents, an unused working capital facility of $10.0 million and no debt.

The Company continues to actively manage liquidity while investing in strategic growth initiatives.

Conference Call Details:

Date: Thursday, August 7, 2025
Time: 4:15 p.m. Eastern Time
Toll-free Dial-in Number: 1-800-717-1738
International Dial-in Number: 1- 646-307-1865
Conference ID: 1148531
Webcast Link: HERE

A telephone replay will be available through Thursday, August 21, 2025. To access the replay, please dial 1-844-512-2921 (domestic) or 1-412-317-6671 (international). At the system prompt, please enter the code 1148531 followed by the # sign. You will then be prompted for your name, company, and phone number. Playback will then automatically begin.

About Inuvo
Inuvo®, Inc. (NYSE American: INUV) is a market leader in Artificial Intelligence built for advertising. Its IntentKey® AI solution is a first-of-its-kind proprietary and patented technology capable of identifying and actioning to the reasons why consumers are interested in products, services, or brands, not who those consumers are. To learn more, visit www.inuvo.com.

Safe Harbor / Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding Inuvo’s quarter-end financial close process and preparation of financial statements for the quarter that are subject to risks and uncertainties that could cause results to be materially different than expectations. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially, including, without limitation risks detailed from time to time in our filings with the Securities and Exchange Commission (the “SEC”), and represent our views only as of the date they are made and should not be relied upon as representing our views as of any subsequent date. You are urged to carefully review and consider any cautionary statements and other disclosures, including the statements made under the heading "Risk Factors" in Inuvo, Inc.'s Annual Report on Form 10-K for the fiscal year ended December 31, 2024 as filed on February 27, 2025, and our other filings with the SEC.  Additionally, forward looking statements are subject to certain risks, trends, and uncertainties including the continued impact of Covid-19 on Inuvo’s business and operations. Inuvo cannot provide assurances that the assumptions upon which these forward-looking statements are based will prove to have been correct. Should one of these risks materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those expressed or implied in any forward-looking statements, and investors are cautioned not to place undue reliance on these forward-looking statements, which are current only as of this date. Inuvo does not intend to update or revise any forward-looking statements made herein or any other forward-looking statements as a result of new information, future events or otherwise. Inuvo further expressly disclaims any written or oral statements made by a third party regarding the subject matter of this press release. The information which appears on our websites and our social media platforms is not part of this press release.

Investor Contact:
Wallace Ruiz
Chief Financial Officer
Tel (501) 205-8397
wallace.ruiz@inuvo.com 

INUVO, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
		Three Months Ended								Six Months Ended
		June 30				June 30				June 30					June 30
		2025				2024				2025					2024
Net revenue		$22,671,333				$18,209,005				$49,379,365					$35,232,782
Cost of revenue			5,576,545				2,906,188				11,197,486					5,005,230
Gross profit			17,094,788				15,302,817				38,181,879					30,227,552
Operating expenses:
Marketing costs			14,138,328				12,431,580				31,651,322					25,534,224
Compensation			3,201,006				3,031,231				6,800,327					6,256,090
General and administrative			1,799,011				1,539,393				3,543,574					2,227,903
Total operating expenses			19,138,345				17,002,204				41,995,223					34,018,217
Operating loss			(2,043,557	)			(1,699,387	)			(3,813,344		)			(3,790,665	)
Finance expense, net			17,697				42,451				45,626					62,831
Other income			559,991				-				1,100,562					-
Income tax expense			-				5,353				2,676					5,353
Net loss		($1,501,263		)		($1,747,191		)		($2,761,084			)		($3,858,849		)
Net loss per share, basic and diluted
Net loss income		($0.10		)		($0.12		)		($0.19			)		($0.28		)
Weighted average shares outstanding
Basic			14,450,640				14,011,853				14,361,782					13,945,396
Diluted			14,450,640				14,011,853				14,361,782					13,945,396

INUVO, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
		June 30			December 31
		2025			2024
Assets
Cash and cash equivalent		$2,135,188			$2,459,245
Accounts receivable, net			9,737,823			12,545,771
Prepaid expenses and other current assets			670,852			639,805
Total current assets			12,543,863			15,644,821
Property and equipment, net			1,755,495			1,792,903
Goodwill			9,853,342			9,853,342
Intangible assets, net of accumulated amortization			3,660,124			3,894,875
Other assets			876,224			1,009,990
Total assets		$28,689,048			$32,195,931
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable		$8,804,533			$8,422,351
Accrued expenses and other current liabilities			7,110,754			9,463,537
Total current liabilities			15,915,287			17,885,888
Long-term liabilities			694,122			835,271
Total stockholders' equity			12,079,639			13,474,772
Total liabilities and stockholders' equity		$28,689,048			$32,195,931

RECONCILIATION OF LOSS FROM NET LOSS TO ADJUSTED EBITDA
(unaudited)
	Three Months Ended									Six Months Ended
	June 30					June 30				June 30				June 30
	2025					2024				2025				2024
Net loss	$(1,501,263			)		$(1,747,191		)		$(2,761,084		)		$(3,858,849		)
Interest Expense		17,697					42,451				45,626				62,831
Income tax Expense		-					5,353				2,676				5,353
Depreciation and amortization		562,558					712,916				1,130,600				1,386,119
EBITDA		(921,008		)			(986,471	)			(1,582,182	)			(2,404,546	)
Stock-based compensation		291,789					318,681				596,073				714,993
Non recurring items:
Employee Benefit		-					-				335,000				-
Adjusted EBITDA	$(629,219			)		$(667,790		)		$(651,109		)		$(1,689,553		)

Reconciliation of Net Loss to EBITDA and Adjusted EBITDA 

We present EBITDA and Adjusted EBITDA as a supplemental measure of our performance. We defined EBITDA as Net loss plus (i) interest expense, (ii) depreciation, and (iii) amortization. We further define Adjusted EBITDA as EBITDA plus (iv) stock-based compensation and (v) certain identified expenses that are not expected to recur or be representative of future ongoing operation of the business. These adjustments are itemized above. You are encouraged to evaluate these adjustments and the reasons we consider them appropriate for supplemental analysis. In evaluating EBITDA and Adjusted EBITDA, you should be aware that in the future we may incur expenses that are the same or similar to some of the adjustments in the presentation. Our presentation of EBITDA and Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items.

FAQ

What was Inuvo's (INUV) revenue growth in Q2 2025?

Inuvo reported 25% revenue growth in Q2 2025, reaching $22.7 million compared to $18.2 million in Q2 2024.

How much cash does Inuvo (INUV) have on hand as of Q2 2025?

As of June 30, 2025, Inuvo had $2.1 million in cash and cash equivalents, along with an unused working capital facility of $10.0 million and no debt.

What was Inuvo's (INUV) net loss per share in Q2 2025?

Inuvo reported a net loss of $0.10 per share in Q2 2025, improved from a loss of $0.12 per share in Q2 2024.

How has Inuvo's (INUV) gross margin changed in Q2 2025?

Inuvo's gross margin decreased to 75.4% in Q2 2025 from 84.0% in Q2 2024, primarily due to changes in product mix.

What is Inuvo's (INUV) five-year growth rate through Q2 2025?

Inuvo maintained a five-year sustained growth rate of 24% through Q2 2025, demonstrating consistent long-term growth.