ZOO Digital Group PLC's (AIM:ZOO) stock dropped 36% after the company warned that full-year revenue and profit would fall short of market expectations.
The media localisation specialist expects revenue to rise 24% to $50.5 million for the year ending March 31. It now predicts an EBITDA profit of at least $1 million, a turnaround from last year’s $13.6 million loss, but lower than hoped.
ZOO has been cutting costs, reducing fixed expenses by 20%, and expects higher margins, but delays and cancellations from customers have hit its order book.
It said it has secured new clients, including Amazon Prime Video, and sees a surge in industry discussions, but many projects won’t contribute meaningfully until 2026.
ZOO expects dubbing revenue to fall next year, though a leaner cost structure and better margins should boost overall profitability. Investors, however, reacted sharply to the disappointing near-term outlook.
The stock fell 10p to 17.5p.