10-Q: Rumble Narrows Losses, Eyes Cloud Growth with Northern Data Deal

Rumble Inc. reported a significant reduction in net losses for Q3 2025 and the nine-month period, driven by cost efficiencies and strategic investments, while announcing a major acquisition and new commitments from Tether.

Summary

• Net loss for Q3 2025 significantly improved to $(16.3) million, a 48% reduction from $(31.5) million in Q3 2024.
• Net loss for the nine months ended September 30, 2025, improved by 52% to $(49.1) million from $(101.6) million in the prior year.
• Total revenues for Q3 2025 slightly decreased by 1% to $24.8 million, while nine-month revenues increased by 13% to $73.6 million.
• Audience Monetization revenue for Q3 2025 decreased by $0.5 million, primarily due to a $4.9 million reduction in advertising revenue, partially offset by a $3.7 million increase in subscription fees.
• Cost of services decreased by $11.2 million (31%) in Q3 2025 and $22.2 million (21%) for the nine months, mainly due to reduced programming and content costs.
• Average Monthly Active Users (MAUs) decreased by 8% to 47 million in Q3 2025 from Q2 2025, attributed to a slowdown in news/political commentary and seasonality.
• Average Revenue Per User (ARPU) increased by 7% to $0.45 in Q3 2025 from Q2 2025, reflecting similar monetization from fewer users.
• Cash and cash equivalents increased to $269.8 million as of September 30, 2025, from $114.0 million at December 31, 2024, largely due to the Tether strategic investment.
• Rumble announced a business combination agreement with Northern Data AG, expected to close in Q2 2026, involving an exchange offer of 2.0281 Rumble Class A shares per Northern Data share.
• Tether committed to purchase up to $150 million of GPU services over two years and a $100 million advertising commitment ($50 million per year for two years).

Sentiment

Score: 7

Explanation: The company demonstrated strong progress in reducing net losses and significantly increased its cash position through a strategic investment. The announced acquisition of Northern Data and new commitments from Tether provide a clear growth path into cloud services and digital assets. However, the slight revenue decrease in the quarter, the decline in MAUs, and the persistent legal and internal control challenges present notable headwinds. The strategic initiatives are promising but carry execution risks.

Positives

• Significant reduction in net loss for both the quarter (48%) and nine-month period (52%) year-over-year.
• Nine-month revenue growth of 13% to $73.6 million.
• Substantial decrease in cost of services, particularly programming and content costs, indicating improved cost efficiency.
• Strong increase in cash and cash equivalents to $269.8 million, bolstered by the $775 million strategic investment from Tether.
• Strategic business combination agreement with Northern Data AG to expand cloud services.
• New commitments from Tether, including a $150 million GPU services agreement and a $100 million advertising commitment.
• Increase in subscription fees by $3.7 million in Q3 2025, indicating growing user monetization through direct offerings.
• Gain of $8.9 million from changes in fair value of warrant liability in Q3 2025 and $24.4 million for the nine months.
• Gain of $9.7 million from changes in fair value of derivative for the nine months ended September 30, 2025.
• Gain of $1.5 million from changes in fair value of digital assets in Q3 2025 and $4.9 million for the nine months.

Negatives

• Total revenues for Q3 2025 slightly decreased by 1% compared to Q3 2024.
• Audience Monetization revenue in Q3 2025 saw a $4.9 million reduction in advertising revenue.
• Average Monthly Active Users (MAUs) decreased by 8% to 47 million in Q3 2025 from Q2 2025.
• General and administrative expenses increased by 8% in Q3 2025 and 32% for the nine months, partly due to one-time compensation costs and public company-related expenses.
• Sales and marketing expenses increased by 28% in Q3 2025 and 23% for the nine months.
• Acquisition-related transaction costs increased significantly to $5.2 million in Q3 2025 and $7.6 million for the nine months.
• Identified material weaknesses in internal control over financial reporting as of December 31, 2024.
• Ongoing legal proceedings, including antitrust lawsuits against Google and a $419.0 million damages claim from Kosmayer Investment Inc.

Risks

• Ability to grow and manage future growth profitably, maintain customer relationships, compete within the industry, and retain key employees.
• Adverse impact from economic, business, and/or competitive factors.
• Limited operating history makes it difficult to evaluate the business and prospects, and recent rapid growth may not be indicative of future performance.
• Inability to continue to grow or maintain the active user base, or achieve or maintain profitability.
• Risks relating to attracting new advertisers, potential loss of existing advertisers, or reduction/failure by existing advertisers to maintain or increase their advertising budgets.
• The cloud business may not achieve success, adversely affecting business, financial condition, and results of operations.
• Negative media campaigns may adversely impact financial performance, results of operations, and relationships with business partners.
• Spam activity, including inauthentic and fraudulent user activity, if undetected, may contribute to overstatement of performance indicators.
• Security breaches, perceived insecurity of sites/applications, and potential governmental investigations and legal claims from users and subscribers due to collection, storage, and processing of user content and personal information.
• Bitcoin treasury strategy exposes the company to various risks associated with holding bitcoin.
• Operation of the crypto wallet (Rumble Wallet) exposes the company to significant regulatory, operational, security, and market risks, including potential classification as money transmission or securities activities, and reliance on third-party crypto exchanges.
• Failure to comply with applicable privacy laws, subjecting the company to liability and damages.
• Exposure to significant regulatory, operational, compliance, privacy, and legal risks related to age verification and child online safety laws (e.g., COPPA, CCPA, DSA, UK Online Safety Act) in various U.S. states and foreign jurisdictions.
• Cybersecurity risks and interruptions or failures in information technology systems, requiring additional resources for protection.
• Potential liability for infringing on the intellectual property of others.
• Potential liability for hosting tortious or unlawful materials uploaded by third parties, notwithstanding Section 230 protections.
• Negative publicity for content moderation decisions (removing or declining to remove content).
• Paid endorsements by content creators may expose the company to regulatory risk, liability, and compliance costs.
• Dependence on effective operation within and compatibility with operating systems, networks, devices, web browsers, and standards, including mobile operating systems, that are not controlled by the company.
• Dependence on continued and unimpeded access to content and services on the internet; disruptions or charges by ISPs could incur additional expenses and loss of traffic/advertisers.
• Significant market competition for traffic and advertising spend.
• Reliance on data from third parties (e.g., Google) to calculate performance metrics, with real or perceived inaccuracies potentially harming reputation.
• Changes to existing content and services could fail to attract traffic and advertisers or generate revenue.
• Dependence on third-party vendors, including internet service providers, advertising networks, and data centers.
• Unexpected increases in hosting and delivery costs.
• Incentives offered to content creators may involve fixed payment obligations not contingent on actual revenue or performance metrics.
• Inability to develop or maintain effective internal controls, and identified material weaknesses in internal control over financial reporting as of December 31, 2024.
• Potential diversion of management's attention and consumption of resources due to acquisitions and challenges in integrating and achieving benefits.
• Failure to maintain adequate operational and financial resources or raise additional capital or generate sufficient cash flows.
• Changes in tax rates, tax treatment of e-commerce companies, new tax legislation, or exposure to additional tax liabilities.
• Compliance obligations imposed by new privacy laws, laws regulating online video sharing platforms, other online platforms, and online speech.
• Risks related to the proposed business combination with Northern Data AG, including termination, adverse impact from uncertainty, and failure to realize anticipated benefits.
• Transition to Large Accelerated Filer status as of December 31, 2025, will require additional resources and expose the company to more stringent reporting and compliance obligations.

Future Outlook

Rumble anticipates continued investment in resources to support growth, expecting increases in cost of services, general and administrative, research and development, and sales and marketing expenses. The company is evaluating strategic opportunities for growth, as evidenced by the Northern Data AG business combination and the new GPU and advertising commitments from Tether, which are expected to drive expansion into cloud services and cryptocurrency. The transition to a large accelerated filer status by December 31, 2025, will also increase compliance obligations and resource allocation.

Management Comments

• "We are continuing to see progress in the uptake of new brands, but we are still at the early stages of that process."
• "We expect to continue to invest substantial resources to support our growth and anticipate that each of the following categories of expenses will increase in absolute dollar amounts for the foreseeable future."
• "Our corporate treasury diversification strategy of allocating a portion of the Company’s excess cash reserves to bitcoin emphasizes our belief in bitcoin as a valuable tool for strategic planning and is designed to accelerate the Company’s expansion into cryptocurrency."
• "As we have consistently stated, we are using a substantial portion of funds to acquire content by providing economic incentives to a small number of content creators."
• "We and our Board of Directors are committed to maintaining a strong internal control environment."
• "Management, with the oversight of the audit committee of our Board of Directors have evaluated the material weaknesses and have implemented a remediation plan to address the material weaknesses and enhance our control environment."

Industry Context

Rumble operates in the highly competitive video sharing and cloud services market, aiming to differentiate itself by supporting content creators and expanding into cloud infrastructure and cryptocurrency. The announced acquisition of Northern Data AG and the GPU services commitment from Tether position Rumble to become a significant player in the cloud services sector, particularly for GPU-intensive applications, aligning with the growing demand for AI and high-performance computing infrastructure. The company's foray into a non-custodial crypto wallet and Bitcoin treasury strategy reflects a broader trend of digital asset integration in tech platforms, albeit with inherent regulatory and market risks. The decline in MAUs attributed to a "slowdown of news and political commentary outside of a U.S. election cycle" highlights the platform's sensitivity to political content cycles, a common challenge for platforms catering to specific niches. The ongoing legal battles, particularly antitrust lawsuits against Google and challenges to state-level content moderation laws, underscore the intense regulatory and competitive pressures faced by online platforms.

Management Changes

Corporate Governance

Legal Proceedings

• Antitrust lawsuit against Google (search engine): Dismissed on statute of limitations grounds (May 21, 2025); Company filed notice of appeal (September 10, 2025).
• Antitrust lawsuit against Google (online advertising): Transferred to Multidistrict Litigation (December 2024); Google filed motion to dismiss (August 1, 2025); Rumble's response filed (October 3, 2025).
• Kosmayer Investment Inc. (KII) lawsuit: Alleging fraudulent misrepresentation, seeking rescission of share redemption or $419.0 million in damages; mediation held (April 2025) with no settlement. Company considers likelihood of payment remote.
• Lawsuit against New York State's Social Media Law: Preliminary injunction granted (February 2023) halting enforcement; questions certified to state high court for interpretation.
• Antitrust lawsuit against World Federation of Advertisers, WPP plc, GroupM Worldwide LLC, and Diageo plc: Dismissed on grounds of lack of personal jurisdiction (August 13, 2025).
• David Stebbins copyright infringement and slander lawsuit: Dismissed against Rumble (May 2025); plaintiff appealed.
• Lawsuit against California AB 2655: Permanent injunction granted (August 5, 2025) against enforcement, ruling Section 230 preempted the law; State of California appealed.
• Lawsuit against Brazilian Supreme Court Justice Alexandre de Moraes: Related to content blocking orders; amended complaints filed (June 6, 2025, and July 16, 2025).
• Lawsuit with Rebel News against Canada, Canada Lands Company, Yaara Saks, et al.: Alleging blocking free speech gatherings; notice of discontinuance filed for certain defendants.
• Michael Goldstein lawsuit (California Invasion of Privacy Act): Alleging improper disclosure of PII via Facebook Pixel; Company filed motion to dismiss (August 18, 2025).

Related Party Transactions

• Compensation to related parties (directors, shareholders, key management) totaled $3,557,939 for Q3 2025 and $17,151,750 for 9M 2025.
• Share-based compensation to key management amounted to $2,845,956 for Q3 2025 and $11,816,744 for 9M 2025.
• Accounts receivable from key management personnel were $1,573,630 as of September 30, 2025.
• Customer relationship with Tether Operations S.A. de C.V. (affiliate of a significant shareholder) generated $987,500 in revenue for 9M 2025.
• Vendor relationship with Cosmic Inc. and Kosmik Development Skopje doo (controlled by CEO Chris Pavlovski and director Ryan Milnes) incurred expenses of $829,617 for Q3 2025 and $2,391,651 for 9M 2025.
• Repurchased 69,938,983 shares of Class A Common Stock from related parties for $7.50 per share on February 7, 2025, as part of the Tether strategic investment tender offer.

Stakeholder Impact

• Shareholders: Potential for increased value from strategic growth initiatives (Northern Data acquisition, Tether commitments), but also dilution risk from future share issuances and uncertainty from ongoing legal challenges. Improved net loss could be positive.
• Employees: Increased share-based compensation and potential for growth opportunities with expansion into new business areas like cloud services. Departures of an executive and director led to one-time compensation costs.
• Customers (Content Creators): Continued incentives offered to attract and retain creators, but MAU decline could impact reach and monetization opportunities.
• Advertisers: Mixed results with a reduction in advertising revenue in Q3 2025, but efforts to attract new brands are ongoing. The $100 million advertising commitment from Tether is a significant boost.
• Creditors: Improved cash position strengthens liquidity and reduces immediate credit risk.
• Regulatory Authorities: Ongoing legal battles related to antitrust, privacy, and content moderation laws highlight significant regulatory scrutiny and compliance burdens.

Next Steps

• Google's opposition brief due November 10, 2025, in the first antitrust lawsuit.
• Rumble's reply due December 1, 2025, in the first antitrust lawsuit.
• Acceptance period for Northern Data AG exchange offer expected to commence in Q2 2026.
• Northern Data AG business combination transaction expected to close in Q2 2026, subject to closing conditions and regulatory approvals.
• Continued implementation of remediation plan to address material weaknesses in internal control over financial reporting.
• Evaluation of potential impact of new accounting pronouncements (ASU 2023-09, 2025-01, 2024-03, 2025-05, 2025-06).
• Transition to a large accelerated filer as of December 31, 2025, requiring more stringent reporting and compliance.

Key Dates

Recommendation

Rumble Inc. has shown significant improvement in reducing its net losses and has substantially strengthened its cash position through a strategic investment from Tether. The announced acquisition of Northern Data AG and the associated GPU and advertising commitments from Tether represent a clear strategic pivot towards high-growth cloud services and digital assets, which could unlock significant long-term value. However, the slight quarterly revenue decline, the decrease in Monthly Active Users (MAUs), and the ongoing material weaknesses in internal controls and numerous legal proceedings introduce considerable uncertainty and execution risk. While the long-term strategic vision is compelling, the immediate operational challenges and regulatory landscape suggest a "hold" position until there is clearer evidence of sustained revenue growth, MAU stabilization, successful integration of Northern Data, and resolution of key legal and internal control issues. The stock's future performance will heavily depend on the successful execution of these strategic initiatives and effective navigation of the complex regulatory environment.

Keywords

Rumble, RUM, video sharing, cloud services, content creators, advertising, subscription, digital assets, bitcoin, crypto wallet, Northern Data, Tether, SEC filing, 10-Q, financial results, Q3 2025, MAU, ARPU, corporate governance, legal proceedings, antitrust, privacy laws, internal controls, strategic investment