Zedge (ZDGE) investor relations material

Executive summary

• FY2026 revenue rose 7.6% to $31.6M as subscription growth supported recovery despite Emojipedia weakness; adjusted EBITDA and free cash flow increased.

• DataSeeds.AI gained commercial traction through repeat orders, its first six-figure order, and an initial model-evaluation engagement.

• Newly appointed CEO Morris Berger prioritized understanding the business and directing investment toward DataSeeds, which he sees as a potential substantial business over time.

Financial highlights

• Q4 revenue rose 4.0% to $7.8M; subscription revenue increased 25.6% to $1.8M, while advertising revenue declined 1.9% to $5.1M.

• Q4 GAAP operating income was $0.3M versus a $0.7M loss; net income was $0.4M and diluted EPS $0.03 versus a $0.6M loss and ($0.04) EPS.

• Q4 non-GAAP net income was $0.5M, diluted EPS $0.04, and adjusted EBITDA $0.5M, up 75.6%.

• FY2026 GAAP operating loss narrowed to $0.6M from $3.2M, and net loss narrowed to $0.1M from $2.4M.

• FY2026 non-GAAP net income was $3.1M, diluted EPS $0.24, and adjusted EBITDA $4.1M, up 134.2%.

Outlook and guidance

• FY2027 DataSeeds priorities include expanding production and technical capabilities, deepening customer relationships, growing the pipeline, and preparing for larger engagements while investing with discipline.

• DataSeeds revenue may remain uneven in FY2027 due to project size and timing; management aims to build a larger, more diversified, consistent business.

• Marketplace paid acquisition will be calibrated more closely to ROAS, potentially moderating growth; stabilizing MAUs and improving monetization remain priorities.

• Management expects to deploy financing over multiple quarters, generally maintain a ~$20M cash cushion, and retain flexibility for compelling opportunities.