Ziff Davis Sees Weak Valuation as Opportunity To Buy

Ziff Davis is making good on its promise to acquire assets, closing two in the first quarter and two more in recent weeks. And it vowed on several occasions during its earnings call to continue buying in 2025.

The publisher of CNET and Babycenter bought TheSkimm, which it files under its health and wellness businesses, and gaming site Maxroll in the first quarter. They have not yet announced the new acquisitions.

Ad revenue rose 12% for the first quarter. Trends for the rest of the year continue to be positive, executives said on the earnings call.

“The kind of ad world that we are looking at should sustain,” Vivek Shah, chief executive officer of Ziff Davis, said on the call. “If we enter into a recession, I think that would obviously change not just our perspective, but I think everyone’s perspectives but we don’t see any indications of that at this moment.”

The tech and shopping segment saw nearly 18% growth, while gaming and entertainment had 7% ad revenue growth. The health and wellness ad market showed promise, with a strong pharmaceutical advertising upfront, which covers all of 2025.

The one segment that did decline in the quarter was cyber security and martech, which fell nearly 11% in revenue, partly due to the timing of certain revenue recognized in prior years. The company expects to see the segment grow in the second half of the year.

Notable figures from the period compared to a year earlier:

• Revenue increased 4.5% to $328.6 million vs. $314.5 million 
• Income from operations decreased to $35.1 million vs. $35.9 million 
• Net income increased 128.1% to $24.2 million vs. $10.6 million  
• Adjusted EBITDA decreased to $100.2 million vs. $100.8 million
• Adjusted net income decreased to $48.9 million vs. $58.5 million
• Free cash flow was $(5) million vs. $47.4 million 

Ziff Davis deployed approximately $39.2 million for current and prior year acquisitions during the quarter. Executives said valuations in digital media are attractive and they may be able to acquire assets at significant discounts.

“Obviously, there’s a meaningful amount of uncertainty in the world right now, but we remain cautiously optimistic; our subscription and licensing businesses are stable and growing nicely in some parts,” Shah said.

Other notable points from the call regarding tariffs, traffic and artificial intelligence:

• The direct impact of possible tariffs is very low
• Roughly 35% of revenue depends on traffic   
• About 40% of traffic-dependent revenue comes from search
• AI overviews have increased from 12% to slightly over 20% of top queries
• They’re cited in about one-third of AIO queries that matter to them; citations potentially include links, which could be beneficial
• Their Moz business is working on tracking AIO performance and they are trying to