RUM Group (RUM) Q2 2026 earnings review
Transformational Quarter Drives Top-Line Surge, But Masks Legacy Cloud Weakness
RUM Group (formerly Rumble) has officially pivoted. The June 17 close of the Northern Data acquisition immediately transformed the financial profile, driving total revenue up 61% YoY to a record $40.4M. Northern Data contributed $10.1M in just 13 days. Consequently, management initiated its first-ever formal guidance, projecting an explosive $87-93M for Q3. The legacy Rumble video business also showed Accelerating momentum, up 21% YoY to $30.3M. However, profitability remains deeply negative. Net loss skyrocketed to $80.9M primarily due to $28.3M in deal-related transaction costs. Furthermore, beneath the headlines of an AI revolution, legacy cloud revenues actually declined.
🐂 Bull Case
The Northern Data acquisition closed successfully, immediately establishing the new 'Quake AI' unit. The guided Q3 revenue midpoint of $90M signals that ND's 22,000 GPUs are highly monetizable and will fundamentally alter RUM's scale.
Despite management's intense focus on AI and infrastructure, the legacy Rumble Video business posted $30.3M in revenue, up 21% YoY. Audience Monetization grew by $5.6M driven entirely by advertising momentum.
🐻 Bear Case
Net loss widened to $80.9M, a severe Decelerating trend in profitability. While $28.3M was acquisition-related, G&A and S&M expenses also surged over 30% organically, indicating that scaling this new AI powerhouse will require heavy, ongoing cash burn.
Excluding the Northern Data injection, Other Initiatives revenue actually fell by $0.4M YoY. Management's narrative that Rumble Cloud was gaining heavy traction organically is contradicted by this decline in pre-acquisition cloud services.
⚖️ Verdict: ⚪
Neutral. The top-line explosion and Q3 guidance are genuinely impressive and validate the strategic pivot to AI infrastructure. However, the immense cash burn, extreme M&A transaction costs, and weakness in the legacy cloud product demand proof of sustainable execution before a fully bullish rating is warranted.
Key Themes
Quake AI & The 2027 Pipeline
RUM has fully split into two units: Rumble (video) and Quake AI (infrastructure). Quake AI inherits ND's ~85% utilized GPU estate. More importantly, management stated they have approximately 250MW of unmonetized capacity targeted for 2027, projecting a $3B+ ARR opportunity. This is an Accelerating shift from a niche video host to a hyperscaler competitor.
Audience Monetization Accelerating
Despite the infrastructure hype, the core media product is performing. Audience Monetization revenue increased by $5.6M YoY. This was entirely driven by a $5.9M jump in advertising revenue, easily offsetting a minor $0.5M decline in subscriptions. The platform's stickiness and scaling ad tech are finally yielding higher monetization.
Together AI Partnership Secures Next-Gen Demand
Quake AI signed a multi-year agreement with Together AI to deploy NVIDIA HGX™ B300 GPU cloud capacity. This validates the technical credibility of the newly acquired data center assets and proves RUM can successfully compete for next-generation (Blackwell architecture) deployment contracts.
Macro: AI Compute Demand Sustains High Utilization
Management noted that Quake AI continues to see strong performance and demand for its existing legacy GPU estate, holding utilization at approximately 85% for the quarter. This robust macro-level demand for AI compute acts as a massive tailwind, protecting the immediate cash flows of the ND assets.
Legacy Cloud Data Contradicts Hype
Prior to this quarter, management aggressively hyped the organic 'Rumble Cloud' as seeing immense enterprise interest. Yet, Q2 data shows that excluding ND, Other Initiatives revenue decreased by $0.4M YoY. A decline in organic cloud services directly contradicts the positive narrative previously sold to investors regarding Rumble Cloud's standalone traction.
M&A Costs Crush the Bottom Line
The cost of transformation is steep. Net loss reached $80.9M. While Adjusted EBITDA was slightly better YoY (-$16.6M), the GAAP numbers were devastated by $28.3M in acquisition-related transaction costs and a massive $16.3M hit in amortization and depreciation. The capital intensity of the AI pivot is now glaringly visible on the income statement.
Operating Expense Creep Across the Board
Even stripping out Northern Data, organic expenses are Reversing away from the promised efficiency. General & administrative costs rose by $1.3M organically, while Sales & Marketing expenses jumped 32% YoY to $10.4M overall. Scaling two distinctly different businesses (Media and AI Cloud) is stretching the cost base.
Other KPIs
Stable. The company holds $203.3M in cash and cash equivalents, complemented by 293.14 Bitcoin valued at $17.2M. While cash decreased from the $237.9M held at the end of 2025, the balance sheet remains sufficiently capitalized to absorb near-term cash burn, though the heavy CapEx requirements for the targeted 250MW build-out by 2027 will likely require external financing.
Reversing. After quarters of year-over-year declines in content costs, total Cost of Services increased 15% YoY. This was driven by $2.5M in incremental data center expenses from ND and $2.1M of higher programming and content costs for the video platform.
Guidance
Accelerating dramatically. The midpoint of $90.0M represents a 262% YoY increase compared to $24.8M in 25Q3, and a 122% sequential increase from 26Q2's $40.4M. This figure reflects the first full quarter of consolidated Northern Data revenues alongside the core video business, fully establishing RUM's new baseline scale.
Key Questions
Funding the 250MW Pipeline
You are targeting 250MW of capacity for Quake AI by 2027, presenting a $3B+ ARR opportunity. Given current liquidity of $220M and ongoing operational burn, what is the specific capital raising strategy (debt, equity, or project financing) required to fund the infrastructure CapEx for this build-out?
Legacy Cloud Decline
Other Initiatives revenue declined organically YoY when excluding Northern Data. Was this due to a deliberate deprioritization of the legacy Rumble Cloud, or are you seeing enterprise churn in that specific segment?
Tether Advertising Ramp
In previous quarters, management noted that the $100M Tether ad commitment would ramp materially in H2 2026. How much of the Q3 guidance of $87-$93M is predicated on Tether's specific commitments versus broad-based organic growth?
Shorts Monetization
With Audience Monetization showing strong ad-driven growth, what is the exact timeline and expected ARPU impact for turning on monetization for Rumble Shorts, which was cited as a massive engagement driver earlier in the year?