International Partnerships And Cloud Investments Will Expand Global Reach

Key Takeaways

• New product launches and partnerships diversify revenue streams, expand monetization, and reduce reliance on a niche user base.
  
• International expansion and investment in AI infrastructure position the company for user growth, higher margins, and long-term earnings strength.
  
• Aggressive expansion and AI/cloud pivot increase operational risk, while regulatory, monetization, and cost pressures threaten profitability if growth and scalability targets fall short.

Catalysts

Operates video sharing platforms and cloud services in the United States, Canada, and internationally.

• The upcoming launch of Rumble Wallet, with integrated crypto tipping and international payments, is poised to increase global user acquisition and drive engagement by tapping new markets where decentralized, creator-driven monetization is highly valued, which should accelerate top-line revenue growth and expand the platform's total addressable market.
  
• Expanding commercial partnerships (e.g., with Tether, Cumulus Media, leading AI players, and MoonPay) creates diversified revenue streams and unlocks new ad inventory and creator monetization opportunities, supporting both revenue and ARPU growth while mitigating reliance on a niche user base.
  
• Early progress in Rumble's premium subscriptions and licensing, combined with improved adtech and publisher integrations through RAC, is increasing ARPU and ad yields, positioning the company for ongoing improvement in net margins and potential EBITDA profitability as more higher-margin revenue is captured.
  
• Rumble's focus on international market expansion, especially through creator onboarding initiatives and marketing the Rumble Wallet outside the U.S., should drive sustained monthly active user (MAU) growth and build long-term operating leverage, supporting revenue scaling and future earnings growth.
  
• Accelerated investment in AI and cloud infrastructure, including a potential acquisition of Northern Data, positions Rumble to capitalize on the secular trend toward scalable, decentralized compute and alternative cloud solutions, potentially unlocking high-value enterprise and government client segments and enhancing long-term gross margins and earnings.

Rumble Future Earnings and Revenue Growth

Assumptions

• Analysts are assuming Rumble's revenue will grow by 23.1% annually over the next 3 years.
• Analysts are not forecasting that Rumble will become profitable in next 3 years. To represent the Analyst Price Target as a Future PE Valuation we will estimate Rumble's profit margin will increase from -289.4% to the average US Interactive Media and Services industry of 11.0% in 3 years.
• If Rumble's profit margin were to converge on the industry average, you could expect earnings to reach $21.4 million (and earnings per share of $0.05) by about August 2028, up from $-301.2 million today.
• In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 354.7x on those 2028 earnings, up from -9.5x today. This future PE is greater than the current PE for the US Interactive Media and Services industry at 13.6x.
• Analysts expect the number of shares outstanding to grow by 7.0% per year for the next 3 years.
• To value all of this in today's terms, we will use a discount rate of 8.01%, as per the Simply Wall St company report.

Rumble Future Earnings Per Share Growth

Risks

• Rumble's heavy reliance on aggressive growth investments following the Tether partnership-combined with a deprioritization of adjusted EBITDA breakeven-risks sustained operating losses and potential cash burn, negatively impacting long-term earnings and solvency if revenue growth or margin improvement does not materialize as projected.
  
• The pending acquisition of Northern Data and the pivot towards AI/cloud infrastructure could stretch management focus and integrate operational risks, while escalating capital requirements; if the core creator/video business underperforms or the AI/cloud business fails to achieve scale quickly, both top-line revenue and net margins could suffer.
  
• Rumble's core user base and monetization approach remain exposed to regulatory headwinds and advertiser sentiment: heightened regulatory scrutiny of contentious content and advertiser aversion to platform polarization could cap ARPU growth and limit scaled ad revenue, especially compared to mainstream competitors.
  
• Expansion efforts into international markets using Rumble Wallet and crypto-based creator monetization are vulnerable to fluctuating global crypto regulations, payment friction, and potential user reluctance, which may slow MAU growth and revenue diversification efforts.
  
• Persistently high infrastructure and content moderation costs-especially as Rumble scales cloud services and supports crypto transactions-could continue to compress net margins, aggravated by the risk that partnerships and new offerings might not deliver adequate operating leverage at scale.

Valuation

• The analysts have a consensus price target of $14.5 for Rumble based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $20.0, and the most bearish reporting a price target of just $9.0.
  
• In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $194.3 million, earnings will come to $21.4 million, and it would be trading on a PE ratio of 354.7x, assuming you use a discount rate of 8.0%.
  
• Given the current share price of $8.43, the analyst price target of $14.5 is 41.9% higher.
  
• We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.