Fluent's Commerce Media Engine Accelerates: From Turnaround to In-Store Pioneer

Q2 marks first aggregate revenue growth in years, with CMS up 90% and a bold entry into physical retail commerce media

FLNT · Earnings Call · 2026-08-10

Return to Growth — The Turning Point

Fluent's second-quarter 2026 results finally delivered the inflection shareholders have awaited. Total consolidated revenue rose 8% year-over-year to $48.4 million, but management rightly highlights the 25% growth on an aggregate continuing basis, excluding the divested Call Solutions business. The engine behind this is Commerce Media Solutions, which grew 90% year-over-year to $30.5 million, now representing 63% of total revenue, up from 36% a year earlier. As CEO Don Patrick put it: “This quarter is the proof. Revenue growth paired with improving margins, the signature of a sustainable business strategy.” — Donald Patrick, Chief Executive Officer · 2026-08-10 The numbers confirm the narrative. Total revenue had been in a structural decline since the 2022 peak, but the mix shift toward higher-margin, contractually recurring Commerce Media revenue is driving the rebound. Gross margin expanded 650 basis points sequentially to 28.9%, and CMS gross profit surged 186% to $8.2 million, representing 27% of CMS revenue—a return to the mid-20s range management had promised. CFO Ryan Perfit noted: “That was ultimately driven by some strong partnerships, better monetization on a couple of key partnerships, and scale of those partnerships.” — Ryan Perfit, Chief Financial Officer · 2026-08-10

In-Store: The Next Growth Vector

The more strategic surprise is the company's decisive move into store offering—in-store commerce media. Through a partnership with Bilt Technologies, Fluent will bring its post-transaction technology to physical point-of-sale, leveraging loyalty data to create a unified commerce platform. This is a first-mover play in a segment where 80% of retail transactions still occur in-store. CEO Don Patrick framed the opportunity:

This is a 5x unlock across commerce, and for media partners in pharmacy, grocery, and home improvement retail sectors, this could mean a 10x increase over monetizable transactions.
Donald Patrick, Chief Executive Officer · 2026-08-10

The partnership launches later this year with Beyond, Inc., and management has already built a pipeline of additional in-store partners for early 2027. While no meaningful revenue is expected in 2026, the market sees this as a second major growth front that could differentiate Fluent from competitors focused solely on online post-transaction. This new initiative also expands the addressable market significantly, from the online-only universe to the full retail experience.

Validating the Model with Tier-1 Partners

The quarter also brought two high-profile validations. CVS Health, one of the largest retail pharmacy chains in the U.S., came online in Q3, marking Fluent's entry into a new vertical. Don Patrick explained the significance: “It brings us into a different vertical, obviously heavily into pharmacy and heavily into along with their retail pieces. So it expands our audience, which obviously plays well into our diversified advertiser strategy.” — Donald Patrick, Chief Executive Officer · 2026-08-10 Equally important, Fluent is now working with captive retail media networks to supply non-endemic demand—advertisers whose products these retailers don't sell directly. This is a meaningful trend, as these walled gardens seek new growth levers. Management noted they are already delivering non-endemic demand into one of the largest retail media networks in the world, a proof point that expands Fluent's competitive position and demonstrates its unique ability to drive superior returns. The momentum echoes prior quarters but has taken a clear step forward. In the May 2026 call, Don Patrick discussed the early-stage incentives rolling off: “We are seeing them roll off throughout 2026.” — Donald Patrick, Chief Executive Officer · 2026-05-13 Now, with CMS margins back in the mid-20s, that trajectory is visible. And the convergence of owned-and-operated advertisers into Commerce Media, flagged in November 2025, has paid off—O&O revenue declined only 24% year-over-year, a sharp improvement from the 50% decline seen last year, and sequentially flat, marking a stabilization. As Don noted: “We have now started bringing our owned and operated advertisers who have not advertised before on Commerce Media into Commerce Media.” — Donald Huntley Patrick, Chief Executive Officer · 2025-11-13

Margins, Cash, and the Path to Profitability

With revenue growth re-established, the focus shifts to profitability. Adjusted EBITDA loss narrowed to $1.8 million in Q2 from $2.8 million a year ago, and management expects a positive Q4. The gross margin improvement is the key driver, and CFO Ryan Perfit holds the line on further expansion: “We do expect to maintain in the mid-20s and then hope to grow it from kind of mid-20s to upper-20s.” — Ryan Perfit, Chief Financial Officer · 2026-08-10 Leverage remains a watch item: effective net cash is negative $17 million, but operating cash flow turned positive at $300,000 for the first half, and short-term debt was reduced from $30.8 million to $26.8 million year to date. The AR facility and disciplined expense management support liquidity. Fluent's stock has already responded—up 59% over the last 11 weeks—but the fundamental story is just beginning. The company has transformed from a legacy performance marketing business into a Commerce Media leader with a two-pronged growth engine, validated by tier-1 partners and a bold entry into in-store media. As CEO Don Patrick concluded: “We have entered Q3 with Commerce Media at 63% of our total revenue and growing, and with the strongest part of the year still ahead.” — Donald Patrick, Chief Executive Officer · 2026-08-10