StumbleUpon Quietly Becomes Profitable As Advertisers Flock To Mobile-Friendly Native Ads

Ten years on, the online content discovery and bookmarking service StumbleUpon is hitting its stride in attracting advertisers to its mobile apps. The company has released revenue data for the first time showing it’s now profitable and expects revenue to hit $35 to 40 million this year, growing as much as 33 percent from last year.

The company shared these stats and more today on Bloomberg, revealing efforts to crack the mobile nut are paying off. StumbleUpon CEO, Mark Bartels says the company expects more than 20 percent of sales this year to come from mobile applications on smartphones and tablets. Nearly 40 percent of “Stumbles” happen on mobile now, up from just 20 percent in 2012.

“Stumble has been trying to figure out: How do you make it easy to browse, rather than type, what you’re looking for?” StumbleUpon co-founder and chairman, Garrett Camp told Bloomberg. “The more effective your recommendations are without textual input, the better experience you can deliver on a small screen, or on a wearable or set-top box.”

StumbleUpon’s mobile apps and desktop service don’t require any typing. Users click or tap buttons to “Stumble” upon new content, add articles to their lists and vote content up or down. Advertisements in the form of video clips, games and mobile websites, are displayed roughly one out of 20 times users tap the Stumble button to discover new content.

StumbleUpon claims 100,000 advertisers including Comedy Central, Relativity Media, Elle, Harper’s Bazaar and Levi’s. Comedy Central pays up to $75,000 to run campaigns — including promoting the show “Drunk History” and an online game in which users spar with a digital version of James Franco — for a few days on StumbleUpon.

“We can use StumbleUpon to help users discover new content or to remind them that content they love from us is out there,” said Don Steele, vice president of digital marketing and fan engagement at Comedy Central, to Bloomberg.

In July, StumbleUpon shut down its once-prominent link shorter, su.pr in favor of their lists feature which came out of beta last October. Users can share lists publicly or keep them private, much like Flipboard magazines. Bartels cut staff by 30 percent to 75 in January. The company has plans to expand internationally and is recruiting engineers with mobile development experience to make that happen.

While huge numbers of advertisers are investing in the service, it’s not clear users are following. The company’s traffic hit a low in August of last year, with traffic falling from 9.7 million unique monthly visitors in January of 2012 to 5.8 million. As the chart below shows, monthly traffic fell as low as 5.1 million in February 2013 and August numbers came in at 5.6 million, below last year.