Direct Digital Holdings Inc (NASDAQ:DRCT) shares sank 14.7% on Thursday after the advertising technology group revealed plans to carry out a 55-to-1 reverse stock split as part of efforts to restore compliance with Nasdaq listing rules.
The company said its Class A common shares will start trading on a split-adjusted basis on January 12, 2026. The primary aim of the move is to lift the share price above Nasdaq’s $1.00 minimum bid threshold and preserve the company’s exchange listing.
Once the reverse split takes effect, the number of outstanding Class A shares will shrink from roughly 68.9 million to about 1.3 million, while Class B shares will be reduced from around 9.3 million to approximately 0.2 million. The stock will continue to trade under the ticker “DRCT,” though it will be assigned a new CUSIP number.
“Executing this reverse split is an important next step in our path forward and enables us to regain compliance with the continued listing requirements for Nasdaq,” said Mark Walker, Chief Executive Officer of Direct Digital Holdings. “Our Nasdaq listing is a key asset for our business and provides our common stock with heightened visibility among institutional investors.”
The reverse split received approval from both the board of directors and shareholders on December 30, 2025. The company noted that no fractional shares will be issued; instead, shareholders will receive cash in lieu of any fractional interests created by the consolidation.
Direct Digital Holdings operates through subsidiaries Colossus Media and Orange 142, offering advertising, marketing and data-driven technology solutions to clients.