20-F: Nexxen Navigates AdTech Shifts, Reports Mixed 2025 Results

Nexxen International Ltd. reports a slight revenue dip in 2025, driven by a strategic shift away from non-programmatic business, while focusing on CTV and Video growth and expanding its V partnership.

Summary

• Total revenue decreased by 0.2% to $364.8 million for the year ended December 31, 2025, from $365.5 million in 2024.
• Programmatic revenue increased by 5.0% in 2025, while Performance (non-programmatic) revenue declined by 41.1%.
• Video revenue grew to $242.0 million in 2025 from $232.4 million in 2024, representing a 4.2% increase.
• CTV revenue decreased to $109.4 million in 2025 from $113.8 million in 2024, a 3.8% decline.
• Total comprehensive income decreased by 21.3% to $27.9 million in 2025 from $35.4 million in 2024.
• Adjusted EBITDA increased by 0.5% to $115.1 million in 2025 from $114.6 million in 2024.
• Cash and cash equivalents were $133.3 million as of December 31, 2025, with no principal long-term debt.
• Contribution ex-TAC increased by 2.8% to $353.1 million in 2025 from $343.5 million in 2024.
• The Contribution ex-TAC retention rate fell to 92% in 2025 from 102% in 2024, attributed to a strategic decision to discontinue relationships with smaller, less profitable customers.
• Active customers decreased to 627 in 2025 from 653 in 2024, and active publishers decreased to 1,304 from 1,516.
• The company completed an additional $20 million equity investment in V (Smart TV OS) in August 2025, bringing total investment to $45 million, with a commitment for another $15 million in Q3 2026.
• The Revolving Credit Facility was reduced from $90 million to $50 million and its maturity date was extended to September 2027.
• The company repurchased 10,840,359 shares for $100.8 million in 2025. An additional $40 million share repurchase program was authorized on November 20, 2025.

Sentiment

Score: 5

Explanation: StockSavvy.ai views this as a mixed report. While strategic shifts towards programmatic and CTV are positive long-term, the immediate financial performance, including revenue decline and reduced comprehensive income, indicates short-term headwinds and execution challenges.

Positives

• Programmatic revenue grew by 5.0% in 2025, driven by strength in Desktop Video and data products.
• Adjusted EBITDA increased by 0.5% to $115.1 million, and the Adjusted EBITDA margin improved to 31.6% in 2025 from 31.3% in 2024.
• Maintained a strong cash position of $133.3 million and eliminated principal long-term debt as of December 31, 2025.
• Strategic investment in V increased to $45 million, securing exclusive global ACR data and North American ad monetization rights through at least the end of 2029.
• Launched what is believed to be the industry's first solution for programmatic Smart TV home screen ad activation in 2025.
• Successfully repaid $100 million in Term Loan Facility and Revolving Credit Facility borrowings in April 2024.
• Reduced doubtful debt expenses by $9.2 million in 2025 due to improved collections.
• Gross profit per active customer increased to $412,901 and Contribution ex-TAC per active customer increased to $563,204 in 2025.
• Ongoing share repurchase programs, with $7.5 million remaining on the current program and a new $40 million program authorized, indicating confidence in valuation and commitment to shareholder returns.

Negatives

• Overall revenue experienced a slight decrease of 0.2% in 2025.
• Performance (non-programmatic) revenue declined significantly by 41.1% due to a diminishing strategic focus.
• CTV revenue decreased by 3.8% in 2025, impacted by macroeconomic uncertainty, competitive CPMs, U.S. trade dynamics, tariffs, and reduced political advertising spend.
• Total comprehensive income decreased by 21.3% to $27.9 million in 2025.
• The Contribution ex-TAC retention rate fell to 92% in 2025 from 102% in 2024, despite being attributed to strategic customer pruning.
• Tax expenses increased substantially by $9.1 million, or 294.7%, to $12.2 million in 2025.
• Research and development expenses increased by $8.1 million (16.1%) due to higher headcount and share-based compensation.
• Selling and marketing expenses increased by $10.8 million (9.6%) due to strategic consulting services and share-based compensation.
• Reduced spending from one large DSP customer in Q4 2025 due to increased Supply Path Optimization (SPO) efforts.

Risks

• Success and revenue growth depend on adding new advertisers and publishers, effectively educating them on platform usage, and increasing their spend.
• Business relies on access to advertising spend from a limited number of DSPs, agencies, and advertisers, which can be reduced or terminated.
• Dependence on maintaining and expanding access to valuable inventory from publishers, including largest ones, with no minimum commitments.
• Failure to make the right investment decisions in the platform or innovate new solutions could harm business.
• Significant parts of the business depend on relationships with third-party data providers for targeted campaigns.
• Limitations on data collection, use, or disclosure due to technical, operational, or regulatory challenges (e.g., restrictions on cookies, mobile device IDs, CTV tracking) could materially harm the business.
• Failure to meet content, inventory, and brand safety standards or maintain advertiser/publisher trust could harm reputation and business.
• Challenges in managing rapid growth effectively could harm business and reduce shareholder value.
• Industry consolidation and increased competition, including from larger, better-capitalized competitors and Supply Path Optimization (SPO) initiatives, could harm the business.
• The market for programmatic buying for advertising campaigns is evolving, and slower or different development than expected could adversely affect results.
• Failure to maintain platform integrity, prevent fraud, or adapt to changing consumer behavior could harm business, reputation, and operating results.
• Inability to scale platform infrastructure to support anticipated growth and transaction volume may limit processing ability and revenue.
• Disruptions to service from third-party data center hosting facilities and cloud computing providers could impair service delivery.
• Potential liability and harm from human error in inputting information into the platform, leading to over-spending.
• Cybersecurity risks, including impersonation and fraud schemes, and any significant failure or breach of systems or third-party vendors, could harm the business.
• Any failure to protect intellectual property rights could negatively impact the business.
• Reliance on non-proprietary technology, software, products, and services could harm the business.
• Revenue and results are highly dependent on overall demand for advertising, susceptible to economic downturns, inflation, geopolitical issues, and pandemics.
• Risks related to the use and development of Generative Artificial Intelligence (AI), including compliance, intellectual property, data privacy, security, and ethical issues.
• Any decrease in the use of primary advertising or publishing channels, or failure to expand into emerging channels, could adversely affect the business.
• If CTV advertising develops in ways that limit the delivery of ads to viewers, business, results of operations, and financial condition could be adversely affected.
• The market is intensely competitive, and the company may not compete successfully with current or future competitors.
• Seasonal fluctuations or market changes in advertising activity could materially impact revenue, cash flow, and operating results.
• If sales and support teams are not effectively grown and trained, the company may be unable to add new customers or increase usage.
• Global operations expose the company to risks beyond its control, including political, economic, and military conditions in Israel and surrounding regions.
• Payment-related risks, including the ability to collect payments from advertisers, could adversely affect financial condition.
• Credit agreement contains covenants that may restrict current and future operations.
• Subject to evolving laws, regulations, and publisher restrictions on political advertising, which could increase costs or reduce revenue.
• Evolving privacy, data protection, and consumer protection laws (e.g., GDPR, CCPA/CPRA, CIPA) and technical restrictions could increase costs, limit data, and harm the business.
• Reliance on publishers, buyers, and data providers to obtain consumer consent, with potential for fines or liability if they fail to comply.
• Potential liability and harm from the nature of the business and content on the platform, and involvement in commercial disputes.
• Subject to anti-bribery, anti-corruption, and similar laws; non-compliance can lead to penalties and reputational harm.
• Termination of the ADS facility and delisting from AIM may reduce liquidity of shares and increase risks associated with a single Nasdaq listing.
• The market price and trading volume of shares may be volatile, leading to potential loss of investment.
• Failure to meet expectations of covering security analysts, or reduced/unfavorable coverage, could cause share price decline.
• Qualifying as an emerging growth company allows reliance on reduced disclosure requirements, which could make shares less attractive to investors.
• Potential loss of foreign private issuer status in the future could result in significant additional costs and expenses.
• Future issuances and sales of shares could negatively affect the market price.
• No guarantee that share repurchase programs will enhance long-term shareholder value.
• Current local tax benefits may be discontinued or reduced if underlying conditions are not met.
• Additional tax liabilities resulting from global operations could materially adversely affect results.
• Increased costs due to operating as a public company listed in the U.S., requiring substantial management time for compliance.
• No anticipated cash dividends, making capital appreciation the sole source of gains for shareholders.
• Exposure to foreign currency exchange rate fluctuations could negatively impact results of operations.
• A small number of significant shareholders have substantial influence over matters requiring shareholder approval, potentially limiting other shareholders' influence.

Future Outlook

The company expects to benefit from the continued growth of digital video advertising, particularly in Connected TV (CTV). It plans to invest in AI, data, and machine learning to enhance its Nexxen Data Platform and Discovery tool, expand CTV and mobile in-app capabilities, and introduce new, differentiated solutions. The V partnership is expected to accelerate long-term CTV revenue growth. While acknowledging potential continued challenging macroeconomic conditions for advertisers in 2026, the company anticipates benefiting from non-annual major advertising events such as the Winter Olympics, FIFA World Cup, and U.S. mid-term election cycle. Operating expenses are expected to increase due to these strategic investments.

Management Comments

• Our mission is to empower full-funnel performance for advertisers, agencies, publishers, broadcasters, and others across the digital advertising ecosystem through robust, and in some cases exclusive, data and media.
• We believe there is a significant market opportunity within the approximately $792 billion global digital advertising market, which is expected to grow at a CAGR of approximately 10% through 2029.
• We believe the digital advertising market remains fragmented, and that our comprehensive end-to-end platform and data capabilities, along with our expertise in Video and CTV, position Nexxen competitively to increase market share over time.
• We believe we are strongly positioned to increase our Contribution ex-TAC retention rate over the long-term through greater enterprise and multi-solution adoption across our end-to-end platform.
• We believe we remain well-positioned to grow CTV revenue over time due to our robust CTV-centric technology capabilities and differentiated CTV data and media assets, alongside growing industry adoption of programmatic CTV advertising.
• We believe we can expand our profitability and margins over time through revenue, total comprehensive income, and Contribution ex-TAC growth, improving operating leverage driven by the structural cost advantages of our end-to-end model, and efficiencies enabled by nexAI.
• We believe that programmatic advertising is still an underpenetrated market that will experience robust growth over the next decade as ad budgets continue to shift to digital and as digital continues to shift towards programmatic execution.
• To the best of our knowledge, we believe no other digital advertising technology company currently offers this capability [programmatic Smart TV home screen ad activation], differentiating Nexxen, accelerating our long-term CTV revenue growth potential, and helping insulate us from SPO trends implemented by the world's largest DSPs.

Industry Context

StockSavvy.ai notes that Nexxen operates in a highly dynamic and competitive digital advertising market, characterized by the continued shift to programmatic advertising, increasing focus on video and CTV, and growing reliance on data and AI. The industry faces challenges from evolving privacy regulations (e.g., cookie restrictions, GDPR, CCPA/CPRA) and macroeconomic headwinds, which have impacted advertiser spending. Nexxen's strategic focus on its end-to-end platform, particularly in CTV and video, and its exclusive data partnerships like with V, positions it to capitalize on these trends and differentiate itself from competitors, especially amidst increasing supply path optimization (SPO) efforts by larger DSPs.

Comparison to Industry Standards

• Nexxen's Adjusted EBITDA margin of 31.6% in 2025 is strong relative to many ad tech peers, indicating efficient operations despite revenue headwinds.
• The decline in CTV revenue (3.8%) contrasts with eMarketer's projected U.S. CTV ad spend CAGR of approximately 12% from 2025 to 2029, suggesting Nexxen faced specific challenges or market share shifts in this segment despite its strategic focus.
• The overall digital advertising market is expected to grow at a CAGR of approximately 10% through 2029, according to eMarketer, while Nexxen's total revenue saw a slight decrease of 0.2% in 2025, indicating underperformance relative to the broader market growth.
• The fall in Contribution ex-TAC retention rate to 92% in 2025 from 102% in 2024, while attributed to strategic customer pruning, suggests a potential challenge in retaining existing customer value compared to industry benchmarks for customer loyalty in ad tech.
• The launch of programmatic Smart TV home screen ad activation is a unique offering, potentially providing a competitive advantage over competitors like Viant Technology, Inc., The Trade Desk, Inc., Magnite, Inc., FreeWheel Media, Inc., and PubMatic, Inc., who may not offer this specific capability.

Management Changes

Corporate Governance

Legal Proceedings

• Filed a complaint against Alphonso, Inc. in May 2021 for breach of contract and tortious interference, which was settled and dismissed in February 2024 following repayment by Alphonso of $11.3 million, including principal, interest, and legal fees.
• A trade secret misappropriation claim filed against the company by Alphonso in June 2022 was voluntarily dismissed with prejudice in October 2023.

Related Party Transactions

• Employment agreements with executive officers.
• Equity incentive awards granted to executive officers and certain directors.
• Exculpation, indemnification, and insurance agreements with directors and executive officers.
• Policy to enter into transactions with related parties on terms that are, on the whole, no more or less favorable than those available from unaffiliated third parties.

Stakeholder Impact

• Shareholders are impacted by the company's share repurchase programs, the absence of cash dividends (making capital appreciation the sole source of gains), and the significant influence of major shareholders. The termination of the ADS facility and delisting from AIM may affect share liquidity and investor base.
• Employees are affected by share-based compensation plans, potential for increased headcount in R&D, and risks related to global operations, particularly in Israel.
• Customers (advertisers and agencies) benefit from the end-to-end platform, data-driven solutions, and focus on Video/CTV, but are impacted by macroeconomic conditions and Supply Path Optimization (SPO) efforts.
• Customers (publishers) benefit from monetization tools and access to demand, but are impacted by changes in inventory value and evolving data privacy regulations.
• Creditors are impacted by the company's liquidity, debt repayment, and compliance with credit facility covenants, though the company currently has no principal long-term debt.

Next Steps

• Deploy the remaining $15 million equity investment in V in Q3 2026.
• Continue investing in AI, data, and machine learning to enhance the Nexxen Data Platform and Discovery tool.
• Expand mobile in-app footprint and partnerships.
• Introduce new, differentiated solutions in Video and CTV.
• Expand programmatic Smart TV home screen ad activation solution beyond V-powered CTVs to additional CTV OEMs.
• Expand end-to-end enterprise partnerships and revenue.
• Strengthen relationships with existing customers to increase advertising spend and multi-solution adoption.
• Expand international footprint and U.S. market share.
• Continue to bolster Nexxen Data Platform's capabilities.
• Target select acquisitions that broaden scale and enhance technology and data solutions.
• Commence an additional $40 million share repurchase program upon completion of the ongoing existing repurchase plan.

Key Dates

Recommendation

Nexxen's strategic pivot towards programmatic and CTV, coupled with its strong cash position and ongoing share repurchase program, presents long-term potential. However, the slight revenue decline, decrease in CTV revenue, and reduced Contribution ex-TAC retention rate in 2025, alongside increased operating expenses and tax burden, indicate near-term challenges and market headwinds. The ongoing geopolitical risks in Israel also add a layer of uncertainty. A 'hold' recommendation reflects a wait-and-see approach to assess the effectiveness of the strategic shift and the company's ability to navigate market pressures and realize its growth initiatives.

Keywords

Digital Advertising, AdTech, Programmatic Advertising, CTV, Video Advertising, DSP, SSP, Data Platform, AI, Machine Learning, Nexxen, V, Hisense, Smart TV, Share Repurchase, SEC Filing, 20-F, Financial Results, Israel, Nasdaq, Corporate Governance, Risk Management, Privacy Regulations