VerticalScope reported revenue decrease and search traffic decrease in Q1 2025

[Max Fridman]

VerticalScope, behind 1,200+ online communities, just confirmed Google updates have negatively impacted their business.

Some highlights from their Q1 '25 earnings update:

• Revenue decreased 8% to $13.6M
• Increased consulting costs for "AI initiatives and SEO optimizations"
• Adjusted EBITDA decreased 30% to $3.6M
• They expect to average 90M monthly active users in Q2
• Generated $3M in operating cash flow
• Net loss of $2.4M (compared to a $1M loss a year ago)

Regarding SEO they also noted that volatility in search results is something they've been dealing with for 20 years so they're not in new territory.
They added that it could be the case that in a future update, things swing back in the direction of prioritising their forums in results again.

Over the last 18 months they massively benefitted from Google's change to more prominently feature forums in search results, but the tide may be turning there.

Looking at the year-over-year search traffic changes for 100 of their forums, third-party data suggests 88 have seen search traffic decrease.

To be respectful, I don't want to go into too much detail on the specific sites, but some estimated to have lost traffic include MTBR.com, ArcheryTalk.com and AskAndyAboutClothes.com.

Many sites appear to have dropped in traffic levels to where they were around two years ago, before forums started featuring far more prominently in search results.

Just as I was about to share this report with the world, VerticalScope confirmed they've seen overall traffic drop 8% year over year. They believe Google is now prioritising AI Overviews and YouTube in search results.

I mean all the respect in the world when I write this (and marked it as 'Somewhat Negative') but this may be a good sign for content site owners which lost out to forums in recent years.

From: https://detailed.com/state-of-seo/

"In Q1, we navigated some challenges, including a more uncertain macro environment, softness in video advertising rates and recent changes to Google's search algorithm which affected traffic on Fora communities. As a result, revenue was 8% lower than prior year," said Rob Laidlaw, Founder, Chair and CEO of VerticalScope.

Mr. Laidlaw continued, "Like other user-generated platforms, we're adapting to an evolving search experience, one that requires optimizing our strategy for AI Overviews, and integrating our own proprietary AI-driven enhancements to improve engagement, accessibility and monetization over time. We are better equipped to handle these algorithm changes with the Fora platform, and the integration of AI, allowing us to roll out important upgrades very quickly. Despite the traffic volatility causing MAU's to be 8% lower in the quarter, we remain confident in our business model, the strength of our communities, and the long-term opportunities ahead."

From: https://investors.verticalscope.com...t-Quarter-2025-Financial-Results/default.aspx

 

[thomas1]

Google's March Core Update was detrimental for us, too.

 

[CedricV]

Google's March Core Update was detrimental for us, too.

For everyone. Just the way it goes I guess. Forums are slowly becoming obsolete.

ChatGPT is now actually climbing the ranks, soon above Google. Which means we are adapting new methods of using the internet. So within time, ChatGPT will replace Google. And to be honest, that's what I'm doing too. I'm no longer wasting hours on google doing research. Instead I just ask ChatGPT and get my results within minutes with the correct sources to back up the research. Time is money, people.

 

[Max Fridman]

As usual we come to the argument: forums are obsolete.
The answer is as usual: it depends.

VerticalScope still makes $13+ mln a year. Only 18% of sites belonging to Digital Goliaths had an increase in yoy traffic. SEO as an acquisition channel works and the bulk of users and visitors, comes from Google not various LLMs (Perplexity, Claude, OpenAI).

And AI overviews are available on Google as well, in ever increasing quantities by the way. And so Google's ability to respond better to certain searches. Number exceeding 5 trillion now.

Google Has Over 5 Trillion Searches Per Year

Google has posted some fresh data, saying they answer over 5 trillion searches per year. The last time we saw this data was in 2016, when Google was at 2 trillion searches per year and then 1.2 trillion in 2012.

www.seroundtable.com

People are looking for content produced by other people, trivially the internet is evolving, toward editorial content produced differently and presented by AI. And the market is likely to change again.

Enthusiast Gaming's report on the growth of PocketGamer.com is emblematic:

The Company’s key owned and operated properties saw sustained engagement and continued year-over-year growth, with overall web pageviews across all web properties increasing to 1.8 billion in Q4 2024 compared to 1.5 billion in Q4 2023, despite both the sale of certain of the Company’s legacy casual gaming properties in April 2024 and the Company’s intentional deprioritization of third-party-owned, low-margin network sites throughout 2024. The Company saw material contributions to this growth from its core property Icy Veins, the Company’s leading site for Blizzard games and ARPG enthusiasts, which saw record user activity on the site from both the continued impact of Blizzard’s World of Warcraft expansion: The War Within, and Blizzard’s October launch of the Diablo IV expansion: Vessel of Hatred, as well as significant contributions from sites like PocketGamer.com, which doubled its traffic over the course of 2024 and continues to grow as the go-to destination for mobile game news, guides, tier lists, and reviews.

From: https://www.enthusiastgaming.com/enthusiast-gaming-reports-q4-and-full-year-2024-financial-results/

I would honestly expect more critical thinking from people who have been running forums for more than 10 years now. And not saying the same things over and over again.

The point of the discussion is not to note that forums are dead, but to see how big companies relate to changes in traffic.

 

[TCG2007]

Own 1200 sites and have done NOTHING to advance or improve communities. And since they're locked to an old version of XF 2.1, they're gonna be in some trouble sooner than later.

 

[cpvr]

Own 1200 sites and have done NOTHING to advance or improve communities. And since they're locked to an old version of XF 2.1, they're gonna be in some trouble sooner than later.

exactly. Prior to purchasing those forums, a majority of them were flourishing and doing well.

Google focuses on mainly active forums and if a forum isn’t providing that, it won’t perform that well.

The main issue here is that they’re not doing anything, it’s not a google problem, it is not a forum wide concern. It is not a forum’s declining concern.

Online communities are still going to do well as long as their leadership continue to provide value and lead the way. However, once their leadership stop caring, then that’s when forums will become demolished and disappear.

 

[frm]

I know the topic is slanted towards "forums dying" or "forums thriving" with the outlook, but VerticleScope should not be a metric that we compare it to whatsoever.

This shouldn't be surprising to anyone in the finance world when 43% of the company is owned by private equity.

 

[Mr Lucky]

. And since they're locked to an old version of XF 2.1, they're gonna be in some trouble sooner than later.

Are they “locked” and isn’t that likely to be a very long time in the future?