BBTV Holdings 7 Unsecured Convertible Debentures T.BBTV.DB

The problem with using Gross Revenue

[Lazaros]

My main beef with this company is their "revenue" figure.  To make it look like they're a huge organization, they quote gross revenue as their top-line revenue figure ($150m Q4). 

This is highly inaccurate and a source of investor concern. The "gross revenue" was never theirs to begin with.  92.5% of that revenue belongs to the content creators and should never show up on BBTV's books.  They should quote their Gross Margin (what I call net revenue) as their revenue figure, because that is the actual revenue they are entitled to. They would never see the $150m to begin with. Their actual revenue was closer to $4m for Q4.

By quoting $450m in revenue, a normal investor would say "Why the heck are you losing money on that much revenue?".  In reality, if they used their actual revenue of ~$40m, their actuall results looks less troubling.  The CEO really wants to feel she is running a tech unicorn, but the reality says otherwise. This is a $40m revenue company.
 

[rant over]

[marketguru]

Im not sure that is fair Lazaros, its not a $40M revenue company, its a $40M gross profit company (big difference). They are trading at less than 10X gross profit where as their comps are trading at >50X gross profit. Also, their latest financials had the metric BBTV Take to provide more transparency about their revenue figures to make it clear that their take of the gross revenues were lower

[Lazaros]

Fair enough. I can respect your view on revenue, although I disagree. As for the metrics, they have been, and are, trending in the right direction. Plus is growing - slowly, but growing. They've signed more influencers. Have a plan to grow their gross margin/net revenue to 25% of gross revenue by 2025. They estimate their take will be $300m.  Aggressive, but I wouldn't invest in a

[Aarman4]

I don't believe the accountants have a choice in the matter..... Their product generates x revenue..... If they shut down, then it doesn't exist...... The amount they pay out to content providers is cost of revenue.......... In the end, every dollar and cent that flows through the company is tracked, and that is the way we want it.... Cheers