Ziff Davis (ZD) Q2 2026 earnings summary

Executive summary

• Completed sale of Connectivity business to Accenture for $1.2 billion ($1,216.1 million), classified as discontinued operations and resulting in a pre-tax gain of $860.6 million.

• Revenues from continuing operations declined 2.7% year-over-year to $286.7 million for Q2 2026.

• Adjusted EBITDA fell 3.7% to $76.8 million, while adjusted diluted EPS rose 13.2% to $1.03, reflecting share buybacks.

• Net income for Q2 2026 surged to $624.5 million, driven by the Connectivity sale, despite a $54.8 million goodwill impairment in Health & Wellness.

• Share repurchases totaled $121.5 million in Q2 2026, with 3.8 million shares repurchased in H1 2026.

Financial highlights

• Q2 2026 revenues: $286.7 million, down from $294.8 million in Q2 2025.

• Adjusted EBITDA: $76.8 million (margin 26.8%), down from $79.8 million; adjusted net income was $37.8 million, nearly flat year-over-year.

• Adjusted diluted EPS: $1.03, up 13.2% from $0.91, driven by share buybacks.

• Free cash flow (combined): $54 million, up 100% year-over-year.

• Operating loss was $44.7 million, due to $54.8 million goodwill impairment.

Outlook and guidance

• Management expects sufficient liquidity for at least the next 12 months, supported by strong cash and credit facility.

• Q3 2026 expected to broadly reflect Q2 performance, with sequential revenue increase but low to mid single-digit year-over-year decline.

• Q4 2026 expected to improve over Q3, with lower revenue decline and slightly down adjusted EBITDA margins year-over-year.

• Adjusted diluted EPS to benefit from reduced share count.

• Forward-looking risks include economic conditions, competition, and regulatory changes.