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System1 (SST)
NYSE:SST
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System1
(NYSE:SST)
47Neutral
System1 (SST) vs. S&P 500 (SPY)
Market Cap
$34.77M
Dividend YieldN/A
Average Volume (3M)126.36K
Price to Earnings (P/E)―
Beta (1Y)1.59
Revenue Growth-19.84%
EPS Growth49.40%
CountryUS
Employees300
SectorIndustrials
Sector Strength82
IndustrySpecialty Business Services
Share Statistics
EPS (TTM)-0.17
Shares Outstanding74,510,020
10 Day Avg. Volume163,505
30 Day Avg. Volume126,362
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.00
Price to Cash Flow (P/CF)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap8.56
Enterprise Value/RevenueN/A
Enterprise Value/Gross Profit1.95
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$5.00Price Target Upside1119.51% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering0
System1 Business Overview & Revenue Model
Company DescriptionSystem1, Inc. develops technology and data science to operate responsive acquisition marketing platform. The company also operates a real-time coupon code search engine and directory that offers coupon destinations for online shoppers. It serves customers in the areas of health, subscription, finance, insurance, business and technology, travel, auto, and other direct-to-consumer businesses. The company was founded in 2013 and is based in Los Angeles, California.
How the Company Makes MoneySystem1 generates revenue through a performance marketing model that focuses on acquiring and monetizing user traffic. Its primary revenue streams include search advertising, where they earn by directing traffic to partner websites and receiving a share of the advertising revenue generated. Additionally, System1 engages in affiliate marketing, earning commissions by promoting and driving traffic to third-party products and services. The company's earnings are also bolstered by partnerships with major search engines and digital advertising networks, which facilitate the delivery of targeted advertisements to users. These partnerships, alongside their technology platform, play a crucial role in optimizing ad spend and maximizing return on investment for advertisers.
System1 Financial Statement Overview
Summary
System1 is struggling with declining revenue, persistent losses, and high leverage. The company faces profitability challenges as reflected in negative margins and cash flows. Addressing these issues is crucial for financial stability and future growth.Income Statement
System1's revenue has been declining significantly, evidenced by a 14.44% decrease from 2023 to 2024. The company also faces negative net and EBIT margins, indicating operational challenges and poor profitability. Gross profit margin improved in 2024, but the company remains unprofitable overall.―
Balance Sheet
The company's balance sheet reflects high leverage, with a total debt of $3.454 million against a modest equity base, resulting in a low debt-to-equity ratio. Equity has decreased significantly over recent years, and the equity ratio is low, posing financial risk.35
Cash Flow
System1 shows a negative free cash flow trend, with a slight increase in 2024 but still negative overall. Operating cash flow remains negative, leading to poor cash flow coverage of net income. The company needs to improve cash generation for sustainability.―
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 343.93M | 401.97M | 826.65M | 688.39M | 475.98M | Gross Profit |
| 152.36M | 46.72M | 305.54M | 675.06M | 134.98M | EBIT |
| -88.60M | -85.99M | 50.83M | -13.33M | 42.62M | EBITDA |
| 14.00M | -4.48M | -427.61M | 64.72M | 52.92M | Net Income Common Stockholders |
| -74.67M | -227.22M | 33.00M | 21.03M | 16.36M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 63.61M | 135.34M | 24.61M | 53.15K | 29.01M | Total Assets |
| 459.13M | 605.47M | 1.16B | 517.62M | 218.68M | Total Debt |
| 3.45M | 355.42M | 422.55M | 450.00K | 179.97M | Net Debt |
| -60.15M | 220.07M | 397.94M | 396.85K | 150.96M | Total Liabilities |
| 374.13M | 436.15M | 687.67M | 60.43M | 266.91M | Stockholders Equity |
| 80.26M | 135.28M | 383.98M | 457.19M | -48.23M |
| Cash Flow | Free Cash Flow | |||
| -5.29M | -32.70M | -17.66M | -7.78M | 40.42M | Operating Cash Flow |
| -5.25M | -24.74M | -7.29M | -1.24M | 46.55M | Investing Cash Flow |
| -6.25M | 203.18M | -454.45M | -6.54M | 68.17M | Financing Cash Flow |
| -63.96M | -74.07M | -27.73M | 450.00K | -128.07M |
System1 Technical Analysis
Negative
0.41
Price Trends
0.41
Negative
0.58
Negative
0.86
Negative
Market Momentum
<0.01
Negative
50.86
Neutral
29.06
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SST, the sentiment is Negative. The current price of 0.41 is above the 20-day moving average (MA) of 0.37, below the 50-day MA of 0.41, and below the 200-day MA of 0.86, indicating a neutral trend. The MACD of <0.01 indicates Negative momentum. The RSI at 50.86 is Neutral, neither overbought nor oversold. The STOCH value of 29.06 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SST.
System1 Risk Analysis
System1 disclosed 61 risk factors in its most recent earnings report. System1 reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
System1 Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
67 Neutral | $24.62M | 2.05 | 45.55% | ― | -12.74% | 751.07% | |
64 Neutral | $4.30B | 11.84 | 5.23% | 249.82% | 4.06% | -10.21% | |
51 Neutral | $28.50M | ― | -6.39% | 8.06% | -96.16% | -113.96% | |
47 Neutral | $34.77M | ― | -80.45% | ― | -19.84% | 49.40% | |
38 Underperform | $35.58M | ― | ― | -4.37% | ― |
* Industrials Sector Average
Performance Comparison
SST
System1
0.44
-1.16
-72.50%
OMEX
Odyssey Marine Exploration
1.19
-2.90
-70.90%
SGRP
Spar Group
1.02
-0.72
-41.38%
NTIP
Network-1 Technologies
1.24
-0.51
-29.14%
SMX
SMX Public Limited Company
1.52
-291.10
-99.48%
LICN
Lichen China Ltd. Class A
3.31
-206.69
-98.42%
System1 Earnings Call Summary
Earnings Call Date:May 06, 2025
(Q1-2025)
| % Change Since: 10.81%|
Next Earnings Date:Aug 07, 2025
Earnings Call Sentiment Neutral
System1 demonstrated strong performance in its financial metrics and success in its owned and operated products, offset by challenges in marketing-driven revenue and uncertainties related to Google product changes.Q1-2025 Updates
Positive Updates
Strong Financial Performance
Q1 revenue was $74.5 million, beating the high end of guidance with a 33% year-over-year increase in adjusted gross profit and a significant rise in adjusted EBITDA to $12.1 million from $400,000 the previous year.
Success of Owned and Operated Products
Owned and operated products saw a 51% year-over-year revenue increase, with CouponFollow user sessions up over 160% and Startpage sessions up 11% year-over-year.
Growth in Partner Network
Partner Network revenue increased by 4% year-over-year, with adjusted gross profit up 37% year-over-year and 4% sequentially.
Expansion in International Markets
International revenue represented 30% of total owned and operated revenue, up from 29% in Q1 2024.
Negative Updates
Decline in Marketing-Driven Revenue
Marketing-driven revenue decreased by 34% year-over-year, primarily due to a decline in a non-core, low-gross-margin business segment.
Challenges with Google Product Changes
Continued volatility related to Google's shift from AFD to RSOC, creating uncertainty and impacting the ability to provide financial guidance for Q2 2025.
Overall Revenue Decline
Total Q1 revenue decreased by 12% year-over-year and 1% sequentially.
Company Guidance
During the first quarter of 2025 earnings call for System1, the company exceeded its guidance range with revenue at approximately $75 million, adjusted gross profit at $41.5 million, and adjusted EBITDA at $12.1 million, marking a 33% year-over-year increase in adjusted gross profit and a substantial rise in EBITDA from $400,000 in the prior year quarter. The owned and operated products, including CouponFollow, Startpage, and MapQuest, showed strong performance with a 51% year-over-year revenue increase, despite a 16% decline in total owned and operated revenue due to a drop in the marketing-driven business. Sessions across owned and operated properties reached 1.3 billion, up 6% year-over-year. The Partner Network also delivered growth with revenue at $70 million and a 37% year-over-year increase in adjusted gross profit. The company is heavily investing in AI-powered automation and Agentic coding, which has significantly increased productivity and accelerated product development. However, due to uncertainties related to Google’s policy changes and broader market volatility, System1 did not provide financial guidance for the second quarter of 2025.System1 Corporate Events
Financial Disclosures
System1 Releases Q1 2025 Financial Information
Neutral
May 6, 2025
On May 6, 2025, System1, Inc. released supplemental financial information for the quarter ending March 31, 2025, on its website. The company also made available an investor presentation, which may be used for future investor engagements. This release provides stakeholders with detailed insights into the company’s financial performance and strategic positioning, potentially impacting investor perceptions and market positioning.
Spark’s Take on SST Stock
According to Spark, TipRanks’ AI Analyst, SST is a Neutral.
System1’s overall stock score reflects significant financial challenges, including declining revenue and high leverage. While there are positive signs from strong EBITDA growth and product performance, ongoing revenue declines and market volatility pose risks. The technical outlook is mixed, and valuation metrics are poor, adding to the cautious perspective.
To see Spark’s full report on SST stock, click here.
Executive/Board Changes
System1 Board Restructures After Director Resignations
Neutral
Apr 18, 2025
On April 15, 2025, Dexter Fowler and Jennifer Prince resigned from the Board of Directors of System1, Inc., with Fowler serving on the Nominating & Corporate Governance Committee and Prince on the Compensation Committee. Their resignations were not due to any disagreements with the company. Following their departure, the Board decided on April 17, 2025, to reduce its size from eleven to nine members and reassigned CEO Michael Blend from a Class III to a Class I director to maintain balance among the board’s classes.
Spark’s Take on SST Stock
According to Spark, TipRanks’ AI Analyst, SST is a Neutral.
System1’s overall stock score reflects significant financial struggles, characterized by declining revenue and high leverage. These factors are compounded by a negative valuation and technical indicators pointing to a bearish trend. While there is some optimism from the earnings call regarding EBITDA growth and product performance, ongoing compliance issues with the NYSE add to the uncertainty, resulting in a low overall score.
To see Spark’s full report on SST stock, click here.
Financial Disclosures
System1 Releases Q4 2024 Financial Information
Neutral
Mar 10, 2025
On March 10, 2025, System1, Inc. released supplemental financial information for the quarter ending December 31, 2024, on its website. The company also made an investor presentation available, which may be used for future investor engagements. These updates provide stakeholders with detailed insights into the company’s financial performance and strategic direction.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.