Q2 2026 System1 Inc Earnings Call Transcript
Key Points
- Successfully completed a debt exchange, reducing total debt from $302.6 million to $150 million, strengthening the capital structure.
- Total sessions to owned and operated product sites increased 31% year-over-year and 5% sequentially, driven by growth in search, mapping, and shopping products.
- Coupon Follow delivered a strong quarter with organic sessions up 11% versus Q1, becoming the number two coupon site by organic traffic behind Reddit.
- MapQuest saw total sessions increase 25% year-over-year in the first half of 2026, with strong display advertising performance and high CPMs.
- Start Page experienced 11% sequential growth in user sessions and a 63% year-over-year increase in mobile app sessions, benefiting from privacy tailwinds.
- Launched Intent Stream, a first-party data product, and began onboarding initial customers, creating a new monetization channel.
- Active partner count increased 5% sequentially, reflecting continued expansion and diversification of the partner network.
- Total revenue decreased 61% year-over-year to $30.2 million, with a sequential decline of 19%.
- Google monetization volatility negatively impacted Start Page and partner network, with payouts and ad coverage fluctuating significantly.
- Partner network net revenue dropped more than 30% in late May and early June due to a Google partner network-wide change, with only a 50% recovery by end of June.
- Adjusted EBITDA fell 83% year-over-year to $1.9 million, missing expectations due to the June monetization downturn.
- Products revenue per session declined 2% sequentially, primarily due to Start Page monetization challenges.
- Marketing segment revenue (excluding owned and operated) decreased 49% year-over-year and 21% sequentially, driven by reduced monetization and volatility.
- The company is not providing Q3 or full-year guidance due to continued volatility, indicating uncertainty in the near-term outlook.
Ladies and gentlemen, thank you for joining us and welcome to the System second quarter 2026 earnings call. (Operator Instructions)
I will now hand the conference over to Kyle Ostgaard, Senior Vice President of Finance. Please go ahead.
Thank you for standing by, and welcome to the second quarter 2026 earnings conference call for System1. Joining me today to discuss System1's business and financial results are our Co-Founder and Chief Executive Officer, Michael Blend; and Chief Financial Officer, Tridivesh Kidambi.
A recording of this conference call will be available on our Investor Relations website shortly after this call has ended. I'd like to take this opportunity to remind you that during the call, we will be making certain forward-looking statements. This includes statements relating to the operating performance of our business, future financial results and guidance, strategy, long-term growth, and overall future prospects. We may also make statements regarding regulatory
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