Nexxen International (NEXN) saw its stock price plummet 5.19% in pre-market trading on Wednesday following the release of its first-quarter 2025 financial results. Despite reporting record Q1 Contribution ex-TAC and programmatic revenue, investors seemed concerned about the company's cautious outlook for the second quarter.

The company reported strong Q1 performance, with Contribution ex-TAC of $75.0 million, up 8% year-over-year, and record Q1 programmatic revenue of $71.8 million, up 10% year-over-year. Notably, CTV revenue grew by 40% year-over-year to $26.4 million. Adjusted EBITDA also saw a significant increase, rising 95% year-over-year to $23.1 million.

However, Nexxen's management acknowledged potential headwinds in Q2, citing softness in the broader advertising market amid economic uncertainty and evolving U.S. trade policies. While the company reaffirmed its full-year 2025 guidance, it cautioned that additional macroeconomic shocks, tariff impacts, or policy shifts could materially affect market sentiment, consumer behavior, and advertising demand. This cautious outlook appears to have overshadowed the strong Q1 results, leading to the sharp decline in the stock price.