Rumble's share price skyrocketed by 83% during December.
Rumble's share prices saw a massive surge in December, climbing an impressive 83.2%, as per S&P Global Market Intelligence's data. This monumental leap happened largely on a single day, following the announcement that Tether, the world's third-largest cryptocurrency, had invested a whopping $775 million into Rumble's business.
Before this game-changing announcement, Rumble's shares had only seen a 1% increase up until Dec. 20. The market's reopening on Monday morning following the weekend's news triggered this spectacular rise.
Rumble's stocks continued their climb, reaching a total increase of about 130% for December before taking a slight dip towards the end of the month. Despite ending December 2021 at roughly the same point it started, this 83% surge distinguished Rumble from the S&P 500, which experienced a 2.5% decline during the same period.
Investors are understandably tickled pink about Rumble's ambitious potential. However, it's no secret that the company has been burning through cash over the past couple of years. Its cash reserves have plummeted by approximately 60%, and it's been operating with a negative cash flow of over $100 million for the last 12 months.
Many investors have been questioning Rumble's ability to keep funding its ambitious vision, which includes building one of the biggest streaming video platforms globally and becoming a major cloud provider. But Tether's investment significantly alters Rumble's financial prospects for the coming years, causing the stock to soar accordingly.
Looking ahead, Rumble's CEO, Chris Pavlovski, is thrilled about the fresh funds, describing them as "fuel for our growth initiatives." And that's exactly how investors should approach Rumble's future and its stock performance. With plenty of cash in the tank once more, Rumble's main challenge now lies in laying the groundwork for long-term growth.
Rumble's Q3 revenue was a meager $25 million, falling far short of its colossal addressable market, which is worth trillions of dollars. However, Q3 revenue grew by 39% year over year. Investors will be keen to see sustained growth in the coming years, or else they may begin to doubt Rumble's long-term potential.
Enrichment Insights:
- Global Expansion and Content Creator Attraction:
- Tether's investment will aid Rumble's global expansion, with a particular focus on regions where free speech is constitutionally restricted.
- Attracting more content creators is critical for Rumble's growth.
- Technical Infrastructure Enhancements:
- Tether's $250 million investment will be used to enhance Rumble Cloud's technical infrastructure.
- Monetization and Revenue Diversification:
- Rumble aims to integrate cryptocurrencies, providing crypto-based rewards and payment options to creators. This aims to reduce reliance on centralized systems and redefine the meaning of a free speech platform.
- Financial Challenges:
- Analysts predict a decline in Rumble's stock price due to the lack of a robust, diversified revenue model and ongoing challenges with monetization and user growth.
- Franchisee and Community Building:
- Under the leadership of President Anthony Badalian, Rumble is prioritizing strategic expansion and supporting franchisees. The company focuses on building a culturally adaptable brand and fostering a loyal member base.
- The announcement of Tether's investment of $775 million into Rumble's business in December caused a significant rise in Rumble's share prices, with a surge of roughly 83%.
- Investors have been interested in Rumble's ambitious potential, but the company has been operating with a negative cash flow of over $100 million for the last 12 months and has been burning through cash over the past couple of years.
- The investment from Tether has significantly altered Rumble's financial prospects for the coming years, leading to an increase in Rumble's stocks and providing the company with "fuel for its growth initiatives".
- Rumble plans to use a portion of the investment received from Tether to enhance its technical infrastructure, with a focus on monetization and revenue diversification through cryptocurrencies and the integration of crypto-based rewards and payment options.
