Kidoz Inc.
Q1 Revenue Jumps 53% Despite Market Headwinds
Published: May 30, 2025
Author: FRC Analysts
*This report and research coverage is paid for and commissioned by Kidoz Inc. – See the bottom of this report for other important disclosures rating, and risk definitions.
Sector: AdTech | Industry: Advertising
Ticker Symbols: KDOZ.V – TSX KDOZF – NASDAQ
Report Highlights
- Q1 revenue rose 53% YoY to $2.7M (Q4-2024: up 23% YoY), marking the highest Q1 revenue in the company’s history, and beating our estimate by 26%. Growth was fueled by strong demand, with advertisers launching multiple campaigns on the Kidoz platform during the quarter. In contrast, YouTube and Meta saw more modest YoY ad revenue growth of 10% and 14%, respectively, in Q1.
- Driven by higher revenue, improved gross margins, and lower G&A expenses, EPS improved from -$0.01 to -$0.0001. Free cash flow turned positive for the first time in four years. We are doubling our 2025 EPS forecast from $0.01 to $0.02.
- Apple (NASDAQ: AAPL) and Meta are responding to stricter child privacy rules, including the FTC’s updated COPPA rule (a U.S. law that protects the personal data of children under 13), taking effect June 23, 2025. Several U.S. states, including California and Utah, are introducing their own legislation to further regulate how apps collect and use children’s data. We believe these changes favor platforms like Kidoz that already comply with COPPA through contextual, non-personalized advertising.
- Global ad spending growth is expected to slow due to elevated uncertainties, including trade tensions, geopolitical risks, and the threat of a global GDP slowdown from Trump’s proposed tariffs. However, we believe these measures may be softened or reversed as trade deals progress and to avoid harming U.S. consumers and businesses. Major digital ad companies saw average YoY revenue growth of 14% in 2024, with consensus forecasts predicting 11% revenue growth (previously 10%) in 2025.
- KIDZ’s forward EV/R is 1.4x vs the sector average of 2.7x, a 48% discount. We anticipate record revenue and EPS in 2025.
Fundamental Research Corp. Equity Rating Scale:
- Buy – Annual expected rate of return exceeding 5%; the expected return is commensurate with risk
- Hold – Annual expected rate of return is between 5% and 12%
- Sell – Annual expected rate of return is below 5% or the expected return is not commensurate with risk
- Suspended or Rating N/A – Coverage and ratings suspended until more information can be obtained from the company regarding recent events.
Fundamental Research Corp. – Risk Rating Scale:
- (Low Risk) – The company operates in an industry where it has a strong position (for example a monopoly, high market share etc.) or operates in a regulated industry. The future outlook is stable or positive for the future. The company generates positive free cash flow and has a history of profitability. The capital structure is conservative with little or no debt.
- (Below Average Risk) – The company operates in an industry where the fundamentals and outlook are positive. The industry and company are relatively less sensitive to systemic risk than companies with a Risk Rating of 3. The company has a history of profitability and has demonstrated its ability to generate positive free cash flows (though current free cash flow may be negative due to capital investment). The company’s capital structure is conservative with little to modest use of debt.
- (Average Risk) – The company operates in an industry that has average sensitivity to systematic risk. The industry may be cyclical. Profits and cash flow are sensitive to economic factors although the company has demonstrated its ability to generate positive earnings and cash flow. Debt use is in line with industry averages, and coverage ratios are sufficient.
- (Speculative) – The company has little or no history of generating earnings or cash flow. Debt use is higher. These companies may be in start-up mode or in a turnaround situation. These companies should be considered speculative.
- (Highly Speculative) – The company has no history of generating earnings or cash flow. They may operate in a new industry with new, and unproven products. Products may be at the development stage, testing, or seeking regulatory approval. These companies may run into liquidity issues and may rely on external funding. These stocks are considered highly speculative.
Disclaimers and Disclosure
The opinions expressed in this report are the true opinions of the analyst about this company and industry. Any “forward looking statements” are our best estimates and opinions based upon information that is publicly available and that we believe to be correct, but we have not independently verified with respect to truth or correctness. There is no guarantee that our forecasts will materialize. Actual results will likely vary.
Fundamental Research Corp. “FRC” owns shares of the subject company: No. The analyst owns shares of the subject company: No , and does not make a market or offer shares for sale of the subject company, and does not have any investment banking business with the subject company.
Annual fees ranging from $15,000 to $30,000 have been paid to FRC by FRC by Kidoz Inc. to commission this report and research coverage including update reports. This fee creates a potential conflict of interest which readers should consider. The purpose of the fee is to subsidize the high costs of research and monitoring. FRC takes steps to ensure independence including setting fees in advance and utilizing analysts who must abide by CFA Institute Code of Ethics and Standards of Professional Conduct. Additionally, analysts may not trade in any security under coverage. Our full editorial control of all research, timing of release of the reports, and release of liability for negative reports are protected contractually. To further ensure independence, Kidoz Inc. has agreed to a minimum coverage term including an initial report and seven updates. Coverage cannot be unilaterally terminated. Distribution procedure: our reports are distributed first to our web-based subscribers on the date shown on this report then made available to delayed access users through various other channels for a limited time.
The distribution of FRC’s ratings are as follows: BUY (69%), HOLD (3%), SELL / SUSPEND (28%). Delivra Health Brands Inc.
