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1. Company Snapshot

1.a. Company Description

Marchex, Inc.operates as an analytics and solutions company that helps businesses connect, drive, measure, and convert callers into customers in the United States and Canada.Its products include Marchex Call Analytics, an analytics platform for enterprises, which depend on inbound phone calls to drive sales, appointments, and reservations; Marchex Call Analytics, Conversation Edition that enable actionable insights for enterprise, mid-sized, and small businesses; Text Analytics and Communications, a solution for intelligent mobile messaging, which enables sales, marketing, and operations teams in businesses to engage in two-way communications with field staff, prospects, and customers through text/SMS messages; Call Monitoring for call recording; and Marchex Marketing Edge, an analytics solution for marketers in enterprise, mid-sized and small businesses that depend on inbound phone calls to drive sales, appointments and reservations.


The company's Marchex Sales Engagement products comprise Marchex Engage, which combines Marchex artificial intelligence and machine learning with call monitoring and scoring services; Marchex Spotlight, a product for corporate and regional managers; Marchex Engage for Automotive; and Marchex Platform Services that allows businesses to add Marchex conversation intelligence to their existing workflows and enabling them to decode what happens in their conversations with customers.Marchex, Inc.was incorporated in 2003 and is headquartered in Seattle, Washington.

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1.b. Last Insights on MCHX

Negative drivers behind Marchex's recent performance include a Q4 loss of $0.03 per share, missing the Zacks Consensus Estimate of a loss of $0.02. Revenue declined to $11.9 million in Q4 2024, compared to $12.4 million in Q4 2023. The company's GAAP revenue for the full year 2024 was $48.1 million, a decrease from the previous year. Additionally, Marchex's recent earnings release did not provide a clear indication of the company's ability to drive revenue acceleration and operational excellence through its AI-powered conversational intelligence solutions.

1.c. Company Highlights

2. Marchex' Q3 2025 Earnings: A Step Towards AI-Driven Customer Acquisition

Marchex reported a revenue of $11.5 million for the third quarter of 2025, a slight decrease from $11.7 million in the previous quarter, primarily due to revenue migration dilution resulting from the transition to the new Marchex Engage platform. Despite the revenue decline, the company saw an improvement in sequential adjusted EBITDA. The actual EPS came out at -$0.02, missing estimates of $0.01. The company's revenue and adjusted EBITDA are expected to be sequentially lower in the fourth quarter of 2025 due to typical seasonality and revenue migration dilution.

Publication Date: Dec -02

📋 Highlights
  • Q3 2025 Revenue Decline:: Revenue dropped to $11.5 million (from $11.7 million Q2) due to legacy platform migration dilution.
  • Archenia Acquisition Terms:: Deal valued at $10M convertible note + up to 4M shares, creating a $60M annualized revenue run rate by 2026.
  • 2026 Revenue Growth Outlook:: Combined platform projects 15–20% annual revenue growth, with $60M run rate by 2026.
  • Adjusted EBITDA Target:: 10%+ margins expected in 2026 post-acquisition, driven by sales growth and platform optimization.
  • Q4 2025 Guidance:: Revenue and adjusted EBITDA to decline sequentially due to seasonality and ongoing migration dilution.

Strategic Acquisition to Drive Growth

Marchex has entered into an agreement to acquire Archenia, a performance-based customer qualification and acquisition company, for a $10 million convertible promissory note and an earn-out of up to 4 million shares. The acquisition is expected to create a vertically focused AI-driven customer acquisition and outcome optimization platform, with a potential revenue run rate of approximately $15 million quarterly, or $60 million annualized, which could grow in the 15% to 20% range in 2026. Management believes that the combined company could achieve adjusted EBITDA margins of 10% or more in 2026.

Valuation and Growth Prospects

Analysts estimate next year's revenue growth at 6.7%. The current valuation metrics indicate a P/S Ratio of 1.51 and an EV/EBITDA of -23.92. With the acquisition expected to close in the first half of 2026, pending approval from Marchex' disinterested stockholders, the company's growth prospects appear promising. The potential combination with Archenia is anticipated to create a larger addressable market with opportunities for cross-selling and bundling solutions, which could drive increased revenue growth and improve sales levels going forward.

Key Takeaways and Future Expectations

While the short-term revenue decline and EPS miss may raise concerns, the strategic acquisition of Archenia and the expected growth in 2026 provide a positive outlook. As the company continues to launch new products and accelerate sales bookings, investors will be watching for progress in the coming quarters. With a current ROE of -15.09% and a Net Debt / EBITDA of 3.75, Marchex' financial performance will be crucial in determining the success of the acquisition and the company's overall growth trajectory.

3. NewsRoom

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MCHX Stock Alert: Halper Sadeh LLC is Investigating Whether the Merger of Marchex, Inc. is Fair to Shareholders

Nov -17

Source: businesswire.com

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Marchex (MCHX) Reports Break-Even Earnings for Q3

Nov -14

Source: zacks.com

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Marchex, Inc. (MCHX) Q3 2025 Earnings Call Transcript

Nov -13

Source: seekingalpha.com

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Marchex to Report Third Quarter 2025 Financial Results on Thursday, November 13, 2025

Nov -06

Source: businesswire.com

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Marchex Launches New AI-Powered Solution to Empower Senior Living Organizations to Boost Occupancy Rates, Increase Return on Ad Spend, and Improve Customer Journeys

Oct -20

Source: businesswire.com

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Marchex, Inc. (MCHX) Q1 2024 Earnings Call Transcript

Sep -22

Source: seekingalpha.com

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Marchex Announces Executive Team Updates

Sep -16

Source: businesswire.com

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Marchex, Inc. (MCHX) Q2 2025 Earnings Call Transcript

Aug -12

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.00%)

6. Segments

Core Analytics and Solutions Services

Expected Growth: 3.0%

Marchex's Core Analytics and Solutions Services growth is driven by increasing demand for AI-powered conversation analytics, expansion into new industries, and strategic partnerships. The 3.0 growth rate is fueled by the rising need for businesses to optimize customer interactions, improve sales conversions, and enhance customer experience, thereby driving adoption of Marchex's innovative solutions.

7. Detailed Products

Marchex Call Analytics

A cloud-based call analytics platform that provides insights into customer interactions, enabling businesses to optimize their marketing campaigns and improve customer experience.

Marchex Speech Analytics

A speech analytics solution that uses AI-powered technology to analyze and provide insights from customer conversations, enabling businesses to identify trends, opportunities, and areas for improvement.

Marchex Sales Edge

A sales enablement platform that provides real-time conversation analytics and coaching tools, enabling sales teams to improve their performance and close more deals.

Marchex Marketing Edge

A marketing analytics platform that provides insights into customer interactions, enabling businesses to optimize their marketing campaigns and improve customer experience.

8. Marchex, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Marchex, Inc. operates in a niche market, providing call analytics and conversational AI solutions. While there are some substitutes available, they are not as comprehensive as Marchex's offerings, reducing the threat of substitutes.

Bargaining Power Of Customers

Marchex, Inc. has a diverse customer base, and no single customer accounts for a significant portion of its revenue, reducing the bargaining power of customers.

Bargaining Power Of Suppliers

Marchex, Inc. has a diversified supplier base, and its business is not heavily dependent on a single supplier, reducing the bargaining power of suppliers.

Threat Of New Entrants

While there are some barriers to entry in the call analytics and conversational AI market, new entrants can still disrupt the market. However, Marchex, Inc.'s established brand and customer base provide some protection.

Intensity Of Rivalry

The call analytics and conversational AI market is highly competitive, with several established players competing for market share. Marchex, Inc. must continually innovate and improve its offerings to maintain its market position.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 5.53%
Debt Cost 13.66%
Equity Weight 94.47%
Equity Cost 13.66%
WACC 13.66%
Leverage 5.85%

11. Quality Control: Marchex, Inc. passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Integral Ad Science

A-Score: 4.8/10

Value: 4.3

Growth: 8.4

Quality: 7.8

Yield: 0.0

Momentum: 4.0

Volatility: 4.0

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Magnite

A-Score: 4.3/10

Value: 2.6

Growth: 7.1

Quality: 5.3

Yield: 0.0

Momentum: 8.5

Volatility: 2.3

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Marchex

A-Score: 3.7/10

Value: 8.0

Growth: 2.6

Quality: 4.6

Yield: 0.0

Momentum: 4.0

Volatility: 3.0

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Clear Channel Outdoor

A-Score: 3.5/10

Value: 6.8

Growth: 2.8

Quality: 4.1

Yield: 0.0

Momentum: 5.0

Volatility: 2.3

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Direct Digital Holdings

A-Score: 3.4/10

Value: 10.0

Growth: 3.0

Quality: 5.4

Yield: 0.0

Momentum: 1.5

Volatility: 0.3

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Fluent

A-Score: 2.7/10

Value: 8.6

Growth: 1.6

Quality: 2.2

Yield: 0.0

Momentum: 2.5

Volatility: 1.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

1.67$

Current Price

1.67$

Potential

-0.00%

Expected Cash-Flows