TSX:ILLM - Post Discussion
Post by
Torontojay on Feb 08, 2023 8:01am
The only relevant metric
The only relevant metric for shareholders to pay attention to is Illumin self serve revenue which at Q3 was $1.2 million. Over the last 2 years, the company has been highlighting the Illumin "managed service" which has similar margins as the old legacy managed business. This is misleading as it doesn't tell us if advertisers are going to graduate to Illumin self serve. After 2 years, it has secured $3.2 m annually from small/medium agencies/advertisers in self serve Illumin compared to ~ $115 m in total revenue. Tal Hayek is telling shareholders this will grow to $15m in 2023. I will caution that he did promise 20-25% revenue growth for 2022 which he's far off the mark.
I think there is value at current prices given the cash balance but the damage has already been done to shareholders. The dust has not cleared in my view and there are still plenty of risks ahead.
What will happen to revenue after third party cookies is phased out? Will they finally put a nail in the coffin to old managed service in 2023? If so, how will that impact revenue and cash flow? These are suppose to be tier 1 clients that are on the old system and the transition to get them on Illumin may be a bumpy ride.
The best end game for the company is if it gets sold to a larger player. That would be a win for shareholders with hopefully more honest management.
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