Video software platform Vimeo (NASDAQ: VMEO) reported Q1 CY2025 results exceeding the market’s revenue expectations, but sales fell by 1.8% year on year to $103 million. Its GAAP loss of $0.02 per share was in line with analysts’ consensus estimates.

Is now the time to buy VMEO? Find out in our full research report (it’s free).

StockStory’s Take

Vimeo’s Q1 results reflected early signs of a turnaround in its self-service business, with management highlighting a return to bookings growth after several years of decline. CEO Philip Moyer pointed to "a 16 point swing" in self-service bookings from the low point in mid-2023, driven by pricing changes that were accompanied by enhanced product offerings, resulting in lower churn rates. The Enterprise segment also contributed, with revenue growth and ongoing efforts to deepen customer relationships, though management acknowledged some deal slippage in the quarter due to macroeconomic pressures.

Looking ahead, management's forward guidance centers on continued investment in innovation—particularly in artificial intelligence (AI) features—and a disciplined approach to operating expenses. CFO Gillian Munson stated that the company will be "really responsible with the dollars," aiming to balance investments with measured growth. Management noted that while the economic environment remains uncertain, Vimeo’s focus for 2025 is on "profitable growth for the full year," with new AI-powered features and expanded monetization opportunities expected to support this goal.

Key Insights from Management’s Remarks

Vimeo’s leadership attributed the quarter’s performance to improved self-service momentum, new pricing strategies, evolving enterprise customer needs, and significant product innovation, particularly in AI-driven features.

• Self-Serve Bookings Growth: Vimeo reversed a multi-year decline in self-service bookings, which management attributed to new pricing models combined with added value for customers, resulting in improved retention and lower churn.
• Enterprise Revenue Expansion: The enterprise segment saw continued revenue growth, supported by a focus on broadening relationships within large organizations. Management noted that some deals were delayed into the next quarter due to broader macroeconomic uncertainty.
• AI Feature Rollouts: The company accelerated the rollout of AI-powered capabilities, such as video translation and security enhancements, first to enterprise clients and now to self-service users. These features are generating early customer interest, especially in regulated industries and marketing.
• Shift in Monetization Models: Vimeo is introducing new ways to monetize AI tools on a consumption basis, aiming to increase average revenue per user (ARPU) and create additional in-period revenue streams beyond traditional subscriptions.
• Organizational Changes: The enterprise business welcomed a new sales leader in Q1, and the board of directors is set for changes with the nomination of three new members following the departure of two longstanding board members.

Drivers of Future Performance

Management’s outlook for the rest of the year is shaped by ongoing investments in AI, evolving customer needs in both enterprise and self-service segments, and a cautious stance toward macroeconomic headwinds.

• AI-Powered Product Expansion: Management expects continued AI feature releases—including agentic video and translation—to drive customer engagement and open new monetization avenues, particularly in international and regulated markets.
• Investment Discipline and Profitability: Vimeo intends to limit investment to $30 million for the year, with a focus on projects that demonstrate measurable growth potential, aiming to balance innovation with a path to sustainable profitability.
• Enterprise Customer Growth Strategy: The company will prioritize expanding average revenue per user and average order value among enterprise clients, leveraging product differentiation to offset deal timing variability and economic pressure.

Top Analyst Questions

• Tom Champion (Piper Sandler): Asked about the impact and retention effects of recent self-serve pricing changes; CEO Philip Moyer emphasized lower churn and ongoing price optimization as key trends.
• Tom Champion (Piper Sandler): Queried CFO Gillian Munson about the company’s investment appetite; Munson stressed responsible spending and a review-driven approach to project funding, aiming to stay under the $30 million cap.
• Youssef Squali (Truist): Sought clarity on customer sentiment amid macro uncertainty; Moyer noted consistent self-service retention and value-driven enterprise discussions, but acknowledged some deal delays.
• Youssef Squali (Truist): Probed the deceleration in enterprise bookings; Moyer explained the lumpiness of enterprise contracts and a strategic focus on revenue rather than bookings as the best growth indicator.
• Bill Kerr (TD Cowan): Inquired about the market response to new AI features and industry-specific demand; Moyer highlighted strong interest from regulated sectors, marketing, and education, particularly for compliance and video translation tools.

Catalysts in Upcoming Quarters

In the coming quarters, our team will be monitoring (1) the pace of adoption and monetization of Vimeo’s new AI-powered features across both self-service and enterprise segments, (2) the impact of organizational changes, including new board and sales leadership, on enterprise deal flow and customer retention, and (3) the company’s ability to maintain investment discipline while delivering profitable growth. Progress in expanding ARPU through consumable AI tools will also be a key signpost.

Vimeo currently trades at a forward EV-to-EBITDA ratio of 26.1×. In the wake of earnings, is it a buy or sell? See for yourself in our free research report.

Stocks That Overcame Trump’s 2018 Tariffs

Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.

While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years.

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.