VerticalScope (FORA) Q1 2026 earnings summary

Executive summary

• Q1 2026 revenue was $11.6 million, down from $13.6 million year-over-year, mainly due to lower programmatic impressions, but direct advertising grew 7%.

• Net loss widened to $3.1 million from $2.4 million year-over-year, primarily due to $5.1 million in non-cash depreciation and amortization.

• Operating cash flow increased 20% year-over-year to $3.5 million, with an 86% free cash flow conversion rate.

• Strategic partnership with AltaML was launched to accelerate AI and agentic workflow integration.

• MAUs averaged 85 million in Q1, rising to 90 million in March and continuing to grow into April and May.

Financial highlights

• Adjusted EBITDA was $2.3 million, down from $3.6 million year-over-year, with margins compressing to 20% from 27%.

• Q1 revenue was $11.6 million, down 15% year-over-year, mainly due to a 22% decline in digital advertising revenue to $9 million.

• Programmatic revenue fell 34% year-over-year, offset by 7% growth in direct advertising and 25% growth in e-commerce.

• Free cash flow was $2.0 million, compared to $3.1 million in the prior year.

• Total liquidity at quarter-end exceeded $75 million, with $19.6 million in cash.

Outlook and guidance

• Q2 is expected to remain challenging for programmatic revenue, but the year-over-year gap is narrowing, with possible growth in the back half of 2026 and into 2027.

• Direct advertising and AI-driven commerce initiatives are expected to drive growth as the year progresses.

• Management targets full-year adjusted EBITDA margins of 30%+ as operating leverage improves.

• AI and agentic workflows are prioritized for investment to drive operating leverage and efficiency.

• Further cost optimizations and reinvestment into AI initiatives are anticipated in upcoming quarters.