Acast has experienced a successful second quarter, according to the company’s latest interim financial report, with net sales up by 15% since the previous period, amounting to SEK 386.3 million (£28.4m).
The report, which covers the period of 1 January to 30 June, showed the company has continued its positive streak for the year after experiencing growth in its first quarter with net sales up by 11% year-on-year, amounting to SEK 331.3 million (£25.8m).
CEO of Acast, Ross Adams, attributed this growth primarily to development in North America, where it grew its net sales by 31%, equal to SEK 110.7 million (£8.12m), as well as growth in Europe and ‘Other Markets’. Adams noted that while the company saw improvements in the American advertising market, with net sales in North America increasing since the previous quarter, there still remains uncertainty due the current macroeconomic climate.
“The second quarter of the year has been marked by a continued improvement of our margins and our results, driven by prudent cost control and positive revenue development especially in North America,” said Adams. “...During the quarter, we noted some early indications of a certain improvement in the American advertising market, including through the US Ad Market Tracker index, which is now increasing for the first time in a year.”
“In the current macroeconomic climate, however, uncertainty remains regarding a possible market recovery.”
Acast also significantly decreased its operating loss from April to June, down by 27% since the previous quarter and by 61% year-on-year. This shows significant improvement since 2022, a period in which economic challenges and a high Q3 operating loss of SEK 352.6 million (£27.5m) led Acast to cost cuts and workforce reductions of 15%.
Despite continuing headwinds, the podcast advertising market in the US continues to be resilient and revenue is expected to more than double between 2022 and 2025 and grow to $4 billion (£3.2b), according to projections from the Interactive Advertising Bureau. Broadcasting corporation SiriusXM also recently reported in its Q2 2023 financial results that its podcast ad revenue was up 13% year-on-year, and the organisation plans to continue investing in testing AI advertising tools for podcasts.
Adams also added that future plans for the company include further development of its self-serve ad platform following the recent addition of host-read sponsorships on the platform and a continued effort to push for automated podcast ad buying.
“The work to automate our services and reduce manual sales work continues with several important initiatives during the second quarter,” said Adams. “By automating the ad buying process, we create higher cost efficiency.”
“At the same time, more opportunities are created for advertisers to reach an engaged and valuable podcast audience. Programmatic ad buying, which allows podcast ad buyers to book ad campaigns efficiently and in real time through the Acast marketplace, continues to be one of our fastest-growing sales channels with positive development in the second quarter as well.”
Following the acquisition of podcast database Podchaser in 2022, Acast also plans to continue building better solutions for advertisers such as the launch of Collections+, which uses both Acast and Podchaser’s data and processes it through AI models in order to allow advertisers to reach a more targeted audience.
Other highlights from this quarter include Acast’s ad sales and content distribution deal with President Barack and Mrs Michelle Obama’s media company Higher Ground as well as the launch of Acast+ Access, which allows companies with an existing paid subscription offering to integrate bonus content into third-party platforms.