Fluent, Inc. Segments Disclosure

13. Segment information

 

The Company identifies operating segments as components of an entity for which discrete financial information is available and are regularly reviewed by the Chief Executive Officer, who is the Company’s CODM, who has final authority in making decisions regarding resource allocation and performance assessment. The profitability measure employed by CODM is earnings before interest, taxes, depreciation and amortization ("EBITDA"). The use of EBITDA as a financial metric provides management and investors with a clearer view of the core business performance and profitability, excluding the effects of financing and other non-operational expenses.

 

As of  December 31, 2025, the Company had three operating segments: a) "Fluent", which is Owned and Operated and Commerce Media Solutions revenue, b) "Call Solutions", and c) "AdParlor". The Company determined that it has one reportable segment, "Fluent," for the purposes of segment reporting. The Fluent reporting segment combines Fluent with the Call Solutions operating segment. This reporting unit works with advertisers to then bring consumers to their products through multiple media channels and earn revenue when a consumer completes an action as agreed upon with the advertisers. The remaining activity represents the operating results of AdParlor, LLC, which mainly performs media buying, and those businesses sold or in run-off, which are included for purposes of reconciliation of the respective balances below to the consolidated financial statements and included within "Unallocated" below.

 

The Company determined its reportable segments based on how revenue is earned as well as the agreements entered into with its advertisers. In addition, certain advertisers overlap within the different operating segments and they are managed consistently with shared management. Further, the Company considered other qualitative factors, such as the environment operated in, and quantitative factors to determine its reportable segment.

 

The significant expense categories and amounts align with the segment-level information that is regularly provided to and used by the CODM in evaluating performance and EBITDA profitability and were identified as a) cost of revenue b) salaries and benefits, c) professional fees, and d) IT and software.

 

The Company does not allocate certain shared expenses such as interest expense and other non-recurring items. The allocation methodology is regularly assessed, evaluated and subject to future changes.

 

Summarized financial information concerning the Company's segments for the twelve months ended twelve months ended December 31, 2025 and 2024 are shown in the following tables below, noting prior period amounts have been recast to conform to the Company's current period segment presentation:

 

		Year Ended December 31,								Year Ended December 31,
		2025								2024
(in thousands)		Fluent				Total				Fluent				Total
Revenue(1):
United States		$	129,690							$	158,871
International			71,853								81,940
Total segment revenue		$	201,543							$	240,811
Reconciliation of revenue
Other revenue							7,221							$	13,812
Total revenue						$	208,764							$	254,623
Costs of revenue
Cost of revenue (exclusive of depreciation and amortization)			156,740								184,109
Costs and expenses:
Salaries and benefits			30,842								36,194
Professional fees			8,066								7,425
IT and software			4,412								3,967
Other operating expense items (2)			12,649								12,354
Segment EBITDA		$	(11,166	)						$	(3,238	)
Reconciliation of segment EBITDA to loss before income taxes
Segment EBITDA (from above)						$	(11,166	)						$	(3,238	)
Plus: Unallocated revenue							7,221								13,812
Less:
Unallocated cost of revenue (exclusive of depreciation and amortization)							783								9,712
Unallocated salaries and benefits							4,088								8,347
Unallocated professional fees							350								1,034
Unallocated IT and software							319								661
Unallocated operating expense items (2)							1,085								4,554
Depreciation and amortization							9,752								9,926
Interest Expense, net							3,074								4,749
Fair value adjustment of Convertible Notes, with related parties							14								1,670
Loss on early extinguishment of debt							3,759								1,009
Loss before income taxes						$	(27,169	)						$	(31,088	)

 

(1)	Revenue aggregation is based upon location of the customer.
(2)	Balance includes sales and marketing expense, travel and entertainment expense, office overhead, restructuring and severance, goodwill impairment and impairment of intangible assets, and other operating costs.

 

		December 31,				December 31,
		2025				2024
Total assets:
Fluent		$	79,570			$	84,373
Unallocated			9,563				9,244
Total assets		$	89,133			$	93,617

As of December 31, 2025, long-lived assets are all located in the United States.

 

For the year ended  December 31, 2025, 22.2% of the Company’s revenue is earned from customers located in Israel.