WP media sees advertising revenue growth of Q3 as difficult to repeat in Q4

"The third quarter was an overlap of two cyclical sporting events therefore [the European Football Championships and the Olympic Games - PAP ed.], so indeed the result [advertising revenue growth - PAP ed.] of the third quarter is difficult to repeat in the fourth one," CEO Swiderski said.

"We are still trying to achieve this result in the fourth quarter, but we have to work for the fourth quarter's result for the whole year, because these are orders which are accepted well in advance (...), so it is certainly not easy for us," he added.

Moreover, in the CEO's opinion, AI solutions will be the driving factor for the media segment in future quarters.

"It is easy to imagine that artificial intelligence has introduced a revolution in the ad serving market, because we are able to tailor ads to individuals rather than groups of users (...)," Swiderski said.

"This insanely increases the effectiveness of, for example, WP Booster (CPC), that more or less quadrupled the effectiveness of ad serving, i.e. a fourfold increase in ad matching," he added.

In the case of the travel segment, the company expects the factors driving this branch to remain constant in the coming quarters.

The CEO pointed out that approximately 600 people, i.e. 30 percent of the group's employees, are IT staff. The company's currently recruiting for IT staff.

Wirtualna Polska's attributable net profit in the third quarter of 2024 fell by 10.4 percent year on year to PLN 77.4 million (EUR 17.9 mln). The PAP Biznes consensus was for PLN 71.4 million (EUR 16.54 mln).

Wirtualna Polska Holding's revenue in the period increased by 7.9 percent year on year to PLN 437.5 million (EUR 101.4 mln). The PAP Biznes consensus was for PLN 436.8 million (EUR 101.2 mln) in revenue.

Adjusted EBITDA increased by 2.5 percent to PLN 153.6 million (EUR 35.6 mln), slightly above the analysts' expectations of PLN 152.7 million (EUR 35.4 mln).

In the advertising and subscriptions segment, cash revenues increased by 7 percent year on year to PLN 167.4 million (EUR 38.8 mln), thanks to a gradual improvement in the growth rate of advertising revenues, as well as an apparent increase in subscription revenues.

The segment's adjusted EBITDA increased by 2 percent year on year to PLN 60.9 million (EUR 14.1 mln), as a result of the containment of the increase in the segment's operating costs, especially those related to salaries and wages (among others, arising from the collective redundancies made during the second quarter of 2024).

As reported, the improvement in advertising revenues in 2024 continues to be slower than it had been earlier expected.

mcb/ ao/ han/