Stock Plummet
The stock of Entravision witnessed a 51% decline, settling at $1.75, subsequent to a 2.5% drop at the close of Tuesday's trading. Overall, shares have experienced a 14% decrease since the beginning of the year.
Impact on Revenue
Entravision revealed that its collaboration with Meta contributed $586.4 million to its total revenue of $1.11 billion in 2023, constituting approximately 53% of its earnings.
Sudden Notice
The abrupt decision by Meta to terminate the program and cut ties with partners by July 1 caught Entravision off guard. However, Meta has not yet provided any comments in response to inquiries.
Financial Implications
Out of the total 2023 Ebitda of $57.7 million, Entravision disclosed that $23.8 million was derived from its partnership with Meta.
Strategic Review and Future Plans
In light of these developments, Entravision, headquartered in Santa Monica, Calif., is currently reassessing its operational strategy and cost structure. The company aims to offer an update promptly.
Debt Obligations and Financial Standing
Entravision highlighted that it remains compliant with all its debt commitments. As of December 31, the company held $118.9 million in cash and marketable securities.
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