BuzzFeed, Inc. on Tuesday reported a Q4 revenue increase of 18% to $145.7 million, reaching a total revenue of $398 million in 2021 — but time spent on BuzzFeed-owned sites and outside platforms is in decline, as is its quarterly commerce revenue.
This is BuzzFeed’s first earnings announcement for quarterly and full fiscal year results since acquiring Complex Networks and trading publicly in December 2021. New York City-based BuzzFeed was the first digital media property to go public. The company also acquired HuffPost in February 2021.
In Q4, BuzzFeed’s $16.7 million of revenue came from commerce — an area the company is aiming to prioritize over its content and advertising. Commerce revenue declined 26%, with its biggest revenue driver remaining advertising at $69.1 million, up 24%, while content accounted for $59.9 million, up 33%. It’s a signal that BuzzFeed will have a difficult time meeting some of its own commerce growth projections — some $150 million in 2022 — pitched to investors last year.
Net income for the quarter increased 29% year-over-year to $41.6 million, with adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) declined 12% to $34.2 million, or 23.5% of revenues. Time spent on BuzzFeed sites and third-party platforms also declined 4% to 186 million hours. The company projects revenue on a pro forma basis including Complex to drop “by a low single digit percentage year over year” in Q1 2022.
BuzzFeed attributed commerce slowdown to Facebook’s shrinking platform and declining engagement and said it would continue its “social first” approach on other faster growing apps, such as TikTok.
“2021 was a year of significant milestones for BuzzFeed,” founder and CEO Jonah Peretti said in a statement. “We became the first publicly traded digital media company, delivered double-digit growth in revenues and profits, and completed the acquisitions of HuffPost and Complex Networks — both of which are already making important contributions to the company’s financial performance.”
In FY2021, BuzzFeed generated $397.6 million in total revenue, up 24% year-over-year. The 2021 advertising revenue was $205.8 million, up 37% year-over-year. Content revenue grew 9% to $130.2 million, and commerce revenue grew 19% to $61.6 million. Net income increased 132% year-over-year to $25.9 million. The company said its commerce content drove some $600 million in attributable transactions in 2021, up almost ten-fold since BuzzFeed launched in 2016. BuzzFeed’s commerce revenue was $4 million in 2016.
BuzzFeed ended the year with cash and cash equivalents of approximately $80 million, after one-time payments for closing its acquisition with Complex Networks and merging with 890 Fifth Avenue Partners, Inc.
The company previously estimated its total revenue for 2022 would hit $653 million driven by commerce, but advertising still accounts for more than half of its total revenue at this point. Many of the revenue projections were based on aggressively growing its commerce from roughly $52 million in 2020 to $150 million in 2022 and $330 million in 2024.
The biggest challenge for BuzzFeed has been Peretti’s attempt to pivot the company from media and content to an e-commerce player. In a pitch deck to investors last year, the company set a $1.5 billion valuation based on a projected profit of $117 million by the end of 2022 that will mostly come from e-commerce through content commissions, merchandise and other brands and events.
Since BuzzFeed began trading publicly last year after merging with the special purpose acquisition company 890 Fifth Avenue Partners, share prices have declined some 50% from around $9 throughout December to below $5 in the last three months.