#Canada #Toronto #Wavelo #Tucows Inc. #Ting Internet

Tucows Demonstrates Strong Performance in 2024

Tucows Inc. (NASDAQ: TCX) has officially announced its financial results for the fourth quarter of 2024, signaling robust growth and resilience within the organization. The company closed out the year with a remarkable 7.1% increase in consolidated net revenue, totaling $93.1 million compared to $87.0 million in the previous year. This achievement marks the fourth consecutive year of growth, emphasizing the steady trajectory of Tucows' business model.

Elliot Noss, President and CEO of Tucows, stated, "Tucows closed 2024 with strong operating revenue growth, underscoring the resilience of our business strategy." A significant contributor to this successful revenue increase was the improvement in the Ting and Tucows Domains segments. However, Noss also acknowledged that the fourth quarter's profitability was impacted by a notable annual impairment charge related to Ting, and by restructuring costs associated with workforce reductions.

Despite these one-time impacts, the organization showcased substantial operational improvements, particularly in Adjusted EBITDA, which soared to $12.8 million for the fourth quarter—a remarkable 403% increase from $2.6 million during the same period in 2023. This surge was primarily attributed to revenue growth within the Domains and Ting sectors, coupled with effective cost management strategies employed in the Ting division.

Financial Highlights

Consolidated Financial Performance

• - Net Revenue: Increased from $86.958 million in Q4 2023 to $93.098 million in Q4 2024 (7% growth).
• - Gross Profit: Rose from $17.821 million in Q4 2023 to $21.224 million in Q4 2024, reflecting a 19% increase.
• - Net Loss: Reported at $45.287 million for Q4 2024, a higher loss compared to $23.374 million for Q4 2023. This was largely due to the aforementioned impairs and restructuring charges.
• - Cash Position: At the end of Q4 2024, cash equivalents and restricted cash totaled $73.2 million, down from $91.1 million in the previous quarter.

Segment Performance

• - Ting Internet Services: Recorded significant growth with revenue of $15.749 million, up from $13.821 million.
• - Wavelo Platform Services: Generated $9.888 million, a slight increase compared to $9.545 million a year earlier.
• - Tucows Domain Services: Saw a total revenue of $65.674 million, demonstrating a healthy portfolio of domain management offerings.

Management emphasizes that, while there are challenges stemming from the restructuring of certain services and increased debt, the long-term strategies applied are yielding positive results. The ongoing deleveraging effort, largely funded through cash flows from Wavelo and Tucows Domains, also reflects positively on financial health.

A Look Ahead

Going forward, Tucows remains committed to optimizing its operations and pursuing growth opportunities. The focus on enhancing financial performance while navigating through market uncertainties will remain a core priority. In a landscape rapidly changing due to technological advancements and competitive pressures, Tucows’ adaptable business model positions the company for continued success.

Shareholders are encouraged to follow updates from management on the upcoming expectations for 2025, given a recorded audio commentary and subsequent Q&A session from the leadership team will be made available on their official website.

About Tucows

Tucows Inc. is a leader in global internet services, dedicated to expanding internet access through various service technologies including fiber-optic infrastructure and domain management. Notable products and services include Ting for high-speed fiber internet and Wavelo for comprehensive telecommunications software solutions. With over 25 million domains under management, Tucows continues to innovate and provide valuable solutions to its customers worldwide.

In summary, Tucows is not only delivering strong financial results but is also strategically positioned for future growth amidst the challenges of the evolving market landscape.