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Vimeo (VMEO)
NASDAQ:VMEO
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Vimeo
(NASDAQ:VMEO)
72Outperform
Positive Factors
Enterprise segment growth
The Enterprise segment is estimated to have a 31.4% year-over-year revenue increase, driven by robust subscription growth.
Market potential
Vimeo continues to operate in a market with an attractive total addressable market and strong secular tailwinds.
Revenue performance
Vimeo's 4Q revenue landed ahead of estimates on better-than-expected Enterprise and Other revenue.
Negative Factors
Financial forecast
Vimeo forecasts an Operating Loss of $5MM in FY25 as incremental spending offsets revenue growth.
Profitability challenges
Adjusted EBITDA is anticipated to be down 50% year over year.
Revenue decline
The decline in revenue is largely driven by a 27.4% decline in Other revenue coupled with a modest 7.5% decline in Self-Serve revenue.
Vimeo (VMEO) vs. S&P 500 (SPY)
Market Cap
$814.37M
Dividend YieldN/A
Average Volume (3M)1.46M
Price to Earnings (P/E)32.0
Beta (1Y)1.62
Revenue Growth-0.05%
EPS Growth23.22%
CountryUS
Employees1,102
SectorTechnology
Sector Strength45
IndustrySoftware - Application
Share Statistics
EPS (TTM)0.16
Shares Outstanding155,452,440
10 Day Avg. Volume1,797,762
30 Day Avg. Volume1,457,793
Financial Highlights & Ratios
PEG Ratio1.38
Price to Book (P/B)N/A
Price to Sales (P/S)2.16
Price to Cash Flow (P/CF)20.90
P/FCF Ratio20.90
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$7.60Price Target Upside47.86% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering4
Vimeo Business Overview & Revenue Model
Company DescriptionVimeo, Inc., together with its subsidiaries, provides video software solutions in New York and internationally. The company provides the video tools through a software-as-a-service model, which enables its users to create, collaborate, and communicate with video on a single platform. It also offers over-the-top OTT streaming and monetization services; AI-driven video creation and editing tools; and interactive and shoppable video tools. It serves creative professionals, small businesses, marketers, agencies, schools, nonprofits, and large organizations. The company was incorporated in 2020 and is headquartered in New York, New York.
How the Company Makes MoneyVimeo primarily generates revenue through a subscription-based model, offering various tiers of service plans to individuals and businesses. These plans provide users with different levels of access to Vimeo's tools and services, including increased storage, enhanced privacy controls, and advanced video analytics. Additionally, Vimeo earns from enterprise customers by offering customized video solutions tailored to specific corporate needs. Another key revenue stream for Vimeo is transactional video on demand (TVOD), where creators can sell or rent their video content directly to viewers. While advertising is not a primary revenue source, Vimeo does form partnerships with businesses and organizations to provide integrated video solutions, which can include custom branding and dedicated support services.
Vimeo Financial Statement Overview
Summary
Vimeo has demonstrated a remarkable financial turnaround with consistent revenue growth and a shift from net losses to profitability. The balance sheet is robust with no debt, and the company maintains strong liquidity. Cash flows have improved significantly, underlining efficient cash management. While there is room for improvement in profitability margins, the financial health of Vimeo is solid, with a positive growth trajectory and low financial risk.Income Statement
Vimeo has shown consistent revenue growth over the years, with a notable increase from $196M in 2019 to $417M in 2024. The company has significantly improved its net income from a loss of $75.6M in 2019 to a profit of $40.4M in 2024, indicating a strong turnaround. Gross profit margins have remained robust, indicating effective cost management. However, the EBIT and EBITDA margins are relatively low, suggesting room for improvement in operational efficiency.75
Positive
Balance Sheet
Vimeo's balance sheet is strong, with zero debt as of the latest report, reflecting a very low risk of financial leverage. The equity ratio has increased over the years, demonstrating growing financial stability. The company has managed to maintain a healthy cash position, with cash and short-term investments consistently exceeding its total liabilities, illustrating strong liquidity. However, the return on equity could be improved to enhance shareholder value.80
Positive
Cash Flow
Vimeo's cash flow situation is quite strong with a significant turnaround in operating cash flow from negative in 2019 to positive in 2024. Free cash flow has also improved, showing the company's ability to generate cash internally. The free cash flow to net income ratio is favorable, suggesting efficient cash management. The company has also shown a good trend in free cash flow growth, reflecting a solid cash position despite fluctuations in investing and financing cash flows.85
Very Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 417.01M | 417.21M | 433.03M | 391.68M | 283.22M | Gross Profit |
| 326.27M | 325.64M | 329.43M | 289.14M | 194.14M | EBIT |
| 18.68M | 13.05M | -82.94M | -61.02M | -40.78M | EBITDA |
| 35.46M | 30.75M | -64.92M | -44.01M | -25.48M | Net Income Common Stockholders |
| 27.01M | 21.56M | -79.59M | -52.77M | -50.63M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 325.28M | 301.37M | 274.50M | 321.90M | 110.01M | Total Assets |
| 642.82M | 622.92M | 605.43M | 649.36M | 371.08M | Total Debt |
| 0.00 | 0.00 | 19.31M | 14.01M | 94.56M | Net Debt |
| -325.28M | -301.37M | -255.18M | -307.89M | -15.45M | Total Liabilities |
| 234.02M | 240.69M | 251.57M | 278.77M | 286.00M | Stockholders Equity |
| 408.80M | 382.23M | 353.86M | 370.60M | 85.08M |
| Cash Flow | Free Cash Flow | |||
| 56.64M | 37.68M | -37.87M | 15.51M | 13.02M | Operating Cash Flow |
| 56.86M | 37.78M | -37.07M | 15.95M | 13.86M | Investing Cash Flow |
| -222.00K | 531.00K | 830.00K | -6.82M | 42.00K | Financing Cash Flow |
| -32.18M | -11.70M | -10.59M | 203.06M | 93.87M |
Vimeo Technical Analysis
Neutral
5.14
Price Trends
5.42
Negative
6.04
Negative
5.52
Negative
Market Momentum
-0.14
Negative
51.22
Neutral
77.07
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VMEO, the sentiment is Neutral. The current price of 5.14 is above the 20-day moving average (MA) of 4.97, below the 50-day MA of 5.42, and below the 200-day MA of 5.52, indicating a neutral trend. The MACD of -0.14 indicates Negative momentum. The RSI at 51.22 is Neutral, neither overbought nor oversold. The STOCH value of 77.07 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for VMEO.
Vimeo Risk Analysis
Vimeo disclosed 47 risk factors in its most recent earnings report. Vimeo 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
Vimeo Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $1.12B | 10.15 | 21.33% | ― | 6.52% | 14.89% | |
73 Outperform | $729.26M | 46.12 | 33.59% | ― | 2.71% | ― | |
72 Outperform | $814.37M | 31.97 | 6.70% | ― | -0.05% | 23.22% | |
71 Outperform | $896.21M | 75.69 | 4.84% | ― | 12.50% | ― | |
66 Neutral | $758.55M | 377.94 | 3.87% | ― | 29.74% | ― | |
66 Neutral | $729.20M | ― | -7.99% | ― | 10.05% | 39.55% | |
59 Neutral | $10.59B | 10.09 | -6.37% | 3.05% | 7.44% | -10.67% |
* Technology Sector Average
Performance Comparison
VMEO
Vimeo
5.14
1.64
46.86%
YALA
Yalla Group
7.53
2.85
60.90%
OPFI
OppFi
9.37
6.73
254.92%
DSP
Viant Technology
13.87
5.57
67.11%
VTEX
VTEX
5.35
-1.97
-26.91%
RSKD
Riskified
4.68
-0.34
-6.77%
Vimeo Earnings Call Summary
Earnings Call Date: Feb 19, 2025 | % Change Since: -24.19% | Next Earnings Date: May 5, 2025
Earnings Call Sentiment Positive
The earnings call presented a largely positive outlook with significant growth in enterprise bookings driven by AI capabilities, successful price increases in the self-serve segment, and a strategic focus on investment in growth areas. However, challenges remain in sustaining subscriber growth in the self-serve segment and achieving higher overall revenue growth.Highlights
Strong AI Impact on Bookings
In Q4, 40% of customer deals were driven by new AI capabilities, highlighting significant customer interest and adoption.
Enterprise Booking Growth
Enterprise bookings showed double-digit unit growth and ARPU growth, with a notable increase in $100,000+ customers.
OTT Streaming Business Recovery
The OTT streaming business returned to bookings growth in Q4, benefiting from new capabilities and faster response to customer demands.
Successful Price Increases in Self-Serve
Price increases in the self-serve segment resulted in double-digit AOV growth with stable retention rates, indicating strong customer willingness to pay.
Investment in Growth Areas
Significant investments planned in formats, security, solutions, and AI, with an expected line of sight to double-digit revenue growth by the end of 2025.
Lowlights
Pressure on Self-Serve Subscriber Numbers
Self-serve subscriber numbers continue to face pressure, despite efforts to increase ARPUs through price adjustments.
Low Overall Revenue Growth
Overall revenue growth is expected to be in the low single digits initially, despite expectations for acceleration throughout the year.
Company Guidance
In the Vimeo Q4 and fiscal year 2024 earnings call, guidance was provided regarding key metrics and future strategies. The company plans to invest up to $30 million, resulting in an EBITDA of about $25 to $30 million, to drive growth primarily through their enterprise business, which showed double-digit unit growth in both new subscribers and ARPU (Average Revenue Per User) during 2024. Vimeo's AI capabilities, launched midyear, contributed to 40% of new bookings in Q4, and the company expects these technological advancements to drive further expansion. Revenue growth is projected in the low single digits initially, with acceleration anticipated throughout 2025, aiming for double-digit growth by year-end. Vimeo's self-serve segment faced pressure but benefited from double-digit increases in AOV (Average Order Value) due to price adjustments, with retention rates remaining stable. The company also highlighted its strategic focus on enhancing video formats, security, and integration into customer workflows as significant growth drivers.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.