Zoomd Technologies. Buy, Sell or Hold?

ATB Capital Markets analyst Martin Toner maintained an “Outperform” rating and $4.00 target on Zoomd Technologies (Zoomd Technologies Stock Quote, Chart, News, Analysts, Financials TSX:ZOMD) on Nov. 28 following third-quarter results that delivered a revenue miss but solid profitability.

Toner noted that Zoomd reported Q3/25 revenue of $16.1-million, down 9% sequentially and below ATB’s $17.9-million estimate, with the shortfall tied to a difficult comparison against a one-time Euro Cup uplift in Q3/24 rather than a deterioration in underlying demand. Revenue was still up 7% year over year.

Gross profit rose to $6.9-million, while gross margin expanded 328 basis points year over year to 42.6%, though down slightly from Q2. Adjusted EBITDA of $4.0-million exceeded ATB’s $3.8-million forecast and was up 2% year over year but down 29% from Q2. EPS of $0.06 missed ATB’s $0.07 estimate.

Management said it is shifting toward “higher-quality revenue” and focusing on geographic expansion in North America and Europe. Toner noted Zoomd added more than ten new clients across iGaming, fintech and e-commerce. He said the E2 partnership strengthens exposure to sports and betting clients and could support higher-margin revenue.

Toner emphasized that adtech revenue can be uneven for smaller players but said he remains confident in Zoomd’s ability to add customers and expand within its existing base. He said the company’s margin profile, cash conversion and capital discipline remain key positives as the industry undergoes “meaningful changes.”

ATB’s forecasts and target are unchanged pending additional detail on the outlook from management’s conference call.

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