Q2 2026 Zedge Inc Earnings Call Transcript
Key Points
- Zedge Inc (ZDGE) achieved record levels of revenue and average revenue per monthly active user, driven by advertising optimization and record active subscription numbers.
- The company reported a significant increase in Zed plus subscription revenue, which grew 33% year over year, with the net active subscriber base increasing by 49%.
- Zedge Inc (ZDGE) ended the quarter with $19.1 million in cash and cash equivalents and no debt, indicating strong liquidity.
- The company is actively investing in innovation, launching new alpha products and expanding its data seeds offering, which has shown attractive margins.
- Zedge Inc (ZDGE) generated solid free cash flow and is now paying a quarterly dividend while continuing to invest in innovation and repurchasing shares.
- Emojiedia faced structural headwinds, resulting in a non-cash impairment charge of $3.7 million, impacting the company's financial results.
- The company reported a GAAP loss from operations of $2.9 million, compared to a loss of $2.2 million last year.
- Revenue from digital goods and services remains lumpy, with minimal contribution from data seeds in the quarter.
- Cost of revenue increased to 6.8% from 6.4% last year due to reductions in partner discounts and new licensing fees.
- The company faces challenges in the rapidly developing AI training data market, requiring careful investment and execution to avoid profitability issues.
Good day ladies and gentlemen, and welcome to Sedge's earning conference call for the second fiscal quarter of 2026.
During management's prepared remarks, all participants will be in a listen-only mode.
Should you need assistance, please signal a conference specialist by pressing the key, followed by 0.
After today's presentation by Zedge's management, there will be an opportunity to ask questions. To ask a question, please press star, then one on your touchtone phone.
To withdraw your question, please press 2.
I will now turn the call over to Mr. Brian Siegel. Sir, the floor is yours.
Thank you, operator. During today's call, Jonathan Wright, Zed's Chief Executive Officer, and Esai, Zed's Chief Financial Officer, will discuss Zedge's financial and operational results that were reported today. Any forward-looking statements made during this conference call, during the prepared marks, or in the question-and-answer session, whether general or specific in nature, are
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