Future (LON:FUTR) executives said tougher conditions in the search ecosystem are weighing on high-margin parts of the business, prompting the company to take a more cautious view on audience trends and full-year profitability in a pre-close trading update call.
Search changes and PPC inflation pressure high-margin areas
CEO Kevin Li Ying said the company had previously outlined its exposure to the changing search landscape—particularly in programmatic advertising and e-commerce—but conditions have worsened rather than stabilized. He said organic search results have moved further down Google’s results pages, driving more “zero-click” behavior and reducing sessions.
CFO Sharjeel Suleman also pointed to ongoing PPC inflation as another headwind, particularly for Go.Compare. Li Ying said PPC costs are “double digit higher year-on-year,” a dynamic Suleman described as market-wide but material to profitability.
H1 revenue broadly in line, but mix shift lowers margin
Suleman said the company’s first-half organic revenue performance is “broadly in line” with expectations, at roughly -6.5%. However, he said the revenue mix has shifted toward direct digital advertising and print, with less contribution from higher-margin e-commerce and programmatic, resulting in an expected first-half margin of around 24% to 25%.
For the second half, Suleman said Future is now planning for audiences to continue declining rather than stabilizing, even though comparatives will be easier. “Given the ongoing volatility in audiences, this is the prudent thing to do,” he said.
On audiences, Suleman told analysts that overall audiences in the first half were down about -20%, similar to the second half of the prior year. In response to a question about Google Discover versus Google Search, he said both channels were down and “relatively similar,” emphasizing volatility and noting another Google algorithm update occurring at the time of the call.
H2 outlook: declines in e-commerce and programmatic offset by growth elsewhere
Suleman said the company is assuming continued declines in e-commerce and programmatic revenue in the second half, at a similar rate to the previous two halves. He described these as higher-margin revenues that are more directly linked to audiences.
At the same time, he outlined expected growth in other parts of the business, assuming macro conditions remain consistent:
- Direct digital advertising in both the U.K. and U.S. is expected to deliver “good growth” in H2.
- Magazines are expected to remain “resilient.”
- Go.Compare is expected to grow through H2 after returning to growth in March, driven by car insurance.
- B2B is expected to return to growth in H2 as new products launch.
Putting those factors together, Suleman said the company expects H2 organic revenue to be down low single digits. On an inorganic basis, Future will also have a full six-month contribution from SheerLuxe, acquired in January, which executives said is outperforming internal plans.
Strategic initiatives: product launches and “Google Zero” approach
Li Ying said management remains focused on strategic initiatives it can control, highlighting growth and momentum in several newer products. He said the company’s AI visibility advertising product Future Optic is “building momentum,” with some of that landing in the first half and “more than double” in the second half, supported by a “strong pipeline.”
The company also recently launched Helix, described as a next-generation first-party data audience intelligence engine intended to drive “guaranteed commercial outcomes” for advertisers. Li Ying said testing across 20 campaigns showed a “double-digit increase in click-through rates” and meaningful improvements in return on ad spend, and that rollout is proceeding in the U.S. followed by the U.K.
Executives repeatedly referenced a “Google Zero” strategy, aimed at reducing reliance on traffic “pushed” via search and instead encouraging audiences to come directly to trusted brands. Li Ying cited SheerLuxe, along with Future’s own brands including Kiplinger and Ideal Home, as examples of the approach working.
In response to questions about initiatives to drive non-Google traffic and engagement, Li Ying provided additional detail on Colab, describing it as performing well on luxury and lifestyle brands and attracting niche, “extremely valuable” audiences. He said engagement metrics are at least “3x more” than non-Colab editorial content, and that Colab is designed to bridge creator content with branded content and commercial sales packages to improve yield.
Li Ying also discussed Future Plus, saying the initiative has generated more than 180,000 free members and is currently launched on three brands, with further rollout planned. He said the membership base supports repeat visits, engagement, and first-party data that can be packaged through commercial activities.
Asked to quantify revenue contributions from new products, Suleman said Future Optic had a “good” pipeline and put its outlook and pipeline at around GBP 10 million for the year. He said other initiatives are earlier-stage and he planned to provide more detail at the half-year update.
EBITDA margin range updated; buyback to be accelerated
Suleman said the mix shift in B2C revenues combined with PPC inflation at Go.Compare is expected to result in a full-year EBITDA margin in the region of 25% to 27%. He said the company is being proactive on costs, including automation and cost reductions, while continuing to invest where returns are attractive.
On cash generation, Suleman said conversion remains in line with guidance of roughly 90% of EBITDA to adjusted free cash flow. Li Ying characterized the business as still generating strong EBITDA and “net free cash flow of circa GBP 100 million.” In Q&A, Suleman clarified that the GBP 100 million figure is cash after tax, interest and working capital needs, and excludes share buybacks—cash the board can allocate to dividends, repurchases, or acquisitions.
Suleman said the board views Future’s shares as “fundamentally undervalued” and intends to use cash generation to repurchase stock, calling it “the best investment today.” He said the company has decided to accelerate its existing GBP 30 million buyback program, with GBP 22 million remaining.
On Go.Compare margins, Suleman acknowledged rising PPC costs but described actions to counter them, including improving search rankings, buying PPC more efficiently, and developing the Renewal insurance wallet app—launched in February—to improve retention and lower customer acquisition costs. While noting the longer-term nature of those efforts, he said he still views Go.Compare as a “good EBITDA 40% margin business” longer term.
Closing the call, Li Ying said management intends to be “even more focused” on driving value in parts of the group that deliver a “platform effect” and realizing value from those that do not, while aiming to make strategic initiatives scale faster.
About Future (LON:FUTR)
Future is a global platform for specialist media underpinned by proprietary technology, enabled by data; with diversified revenue streams
