Zedge, Inc.

Ladies and gentlemen, thank you for your patience. This conference will begin shortly. Once again, thank you for your patience and this conference will begin shortly. Good afternoon and welcome to Zedge's earnings conference call for fiscal fourth quarter and end of year 2023 results. 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 star key followed by zero. After today's presentation by Zedges Management, there will be an opportunity to ask questions. To ask a question, press star then 1 on your touchtone phone. To withdraw your question, please press star 2. I will now turn the call over to Brian Segal. Sir, you may begin.

Thank you, operator. In today's presentation, Jonathan Reich, ZEDRA's Chief Executive Officer at ESI, ZEDRA's Chief Financial Officer, will discuss ZEDRA's financial and operating results that were reported today. Any forward-looking statements made during this conference call, during the prepared remarks, or in the question and answer session, whether general or specific in nature, are subject to risks and uncertainties that may cause actual results in the future to differ materially from those discussed on today's call. These risks and uncertainties include but are not limited to specific risks and uncertainties disclosed in the reports that ZEDGE periodically files with the SEC. ZEDGE assumes no obligation to update any forward-looking statements or to update the factors that may cause actual results to differ materially from those that they forecast. Please note that our earnings release is available on the Investor Relations page on the ZEDGE website. The earnings release has also been filed on Form 8K with the SEC. I would like to turn the call over to Jonathan.

Good afternoon. Thank you, Brian, and thank you all for joining us today. I will start by briefly reviewing our fourth quarter results, which were generally in line with our expectations. Q4 revenue decreased 10 percent from last year. While we encountered challenges stemming from the combination of geopolitical, economic, and industry-specific issues, we observed ongoing stabilization in advertising, with ad revenue remaining flat sequentially, even during the traditionally weaker Q4 period. Furthermore, in Q4 of fiscal year 2022, we had a one-time $4 million accounting benefit, skewing year-over-year earnings comparisons. Other positive highlights from the quarter included 7% sequential growth in subscription revenue as our new iOS and overhauled Android offerings contributed to positive momentum. Additionally, Zedge Premium's gross transaction value, or GTV, was up 14% year-over-year and down $26,000 sequentially, benefiting from paying users of Paint, our generative AI wallpaper maker. All of this led to higher gross margin and sequential ARPMO growth. Finally, Emojipedia continued to build on its momentum throughout the year, with revenue up nearly 70% versus last year. Every year, we pick at least one company-wide area of focus to overhaul. In fiscal year 23, we addressed data and analytics, and I'm happy to report that we achieved our goal of democratizing data. The improvements we made empower our product marketing, monetization, finance and executive teams to access accurate and granular data more quickly and run experiments in concert with one another to more easily and quickly make data driven decisions. As a part of this overhaul, we expanded our data team and we are now very well positioned for continued evolution in a world that is ever dependent on data supremacy. In fiscal 2024, we are committed to building a full-stack marketing team with capabilities spanning user acquisition, branding, creative creation, marketing analytics and reporting, competitive research, content marketing, app store and search engine optimization, and reengagement marketing. Though we already possess many of these skills, we're now bulking up in the areas we haven't previously invested in. Furthermore, We are also using AI in our workflow to scale quickly and efficiently. In light of the sea change that has occurred in the mobile app marketing space with Apple's ID fade deprecation and the upcoming rollout of Google's privacy sandbox across Android, it has become imperative for app developers like us to excel in many marketing disciplines. We expect to increase our investment in paid user acquisition, and enhance our expertise in all areas of the marketing staff to generate attractive return on ad spend or ROAS efficiently. From a product perspective, we have multiple initiatives to enhance existing products and further diversify our portfolio. From the Zedge Marketplace, we will focus on expanding Paint, our generative AI wallpaper maker. Our key priorities include the global rollout of Paint, which may unleash high growth opportunities, especially in markets where we are an early entrant. We also plan to offer Paint on our website, enabling users to create all types of images, not only wallpapers. I want to underscore that our current iteration of Paint opens new opportunities in the iOS ecosystem where we can compete on equal footing in light of Apple openly welcoming this new technology. Finally, in the second half of this year, we expect to introduce a standalone GenAI app that will offer many more capabilities and, with time, encompass more than images alone. Beyond iOS and Android, we plan to revamp our website, enabling users to access Paint to create all types of images, not only wallpapers. We will also test a print-on-demand capability so that users can bring their creations into the real world. I mentioned Zedge Plus, our Zedge Marketplace subscription offering earlier. I'm excited because prospective subscribers are responding well to the overhaul evidenced by our subscription revenue going up on a sequential basis. With ongoing investments not only in marketing but also in testing subscription value adds and a variety of pricing skews, we hope to return to subscriber growth sooner rather than later. Turning to Guru Shots, not unlike what we initially experienced with Emojipedia, Guru Shots is taking more time to scale than we would prefer. Yet, we remain confident in its long-term prospects. Although the gaming sector has faced global and economic challenges, the thorniest issue relates to Apple's app transparency tracking framework, which severely limits the information that app marketers can secure to target prospective customers. Although Apple released SCAD network 4.0 in order to enable growth with improved attribution tracking capabilities, the impact will be limited until major platforms like Meta are successful in embedding this into their tech stack. In the meantime, we are taking a two-pronged approach to stabilizing GuruShots and positioning it for growth. First, we focused on product innovation by rolling out Battles, a new hybrid casual gameplay feature for users to start competing in fast-paced, short-duration photo competitions that are limited in size. Battles is important and will help make the Guru Shots game more accessible and relevant to a broader audience, hopefully converting users into long-term players. In addition, we are also evolving with a token-based economy and will start introducing advertising-supported experiences in early calendar 2024. Second, We are working closely with both Google and Meta to adapt and expand ROAS-positive paid user acquisition by optimizing against several inputs, including creatives. This will take time and resources as their algorithms optimize for relevant customers. Suffice it to say, we are monitoring developments closely, testing, speaking with other publishers, and keeping our ear close to the ground to invest wisely. We are building on Emojipedia's fiscal 2023 success with continued innovation and plan to test features like emoji translations and mashups, along with new content verticals like emoticons, print-on-demand merchandising, and hyper-casual emoji games and quizzes. Beyond our three core product groups, we have soft-launched AI Art Master in five countries and currently plan to expand globally over the next several months. We believe AI Art Master, a hybrid casual Gen AI game that enables users to create wowing content to compete against other players in fun, fast-paced competitions, has the potential to be a fourth core product for us. AI Art Master capitalizes on Guru Shat's mobile gaming expertise and the hottest tech trend, Gen AI, positioning AI Art Master at the center of the explosive growth that both the gen AI and gaming sectors are experiencing. Taken together, we believe that we have never been in a better position to create sustainable long-term profitable growth given the combination of market opportunity, our current product portfolio and roadmap, our marketing prowess, data capabilities, tech stack, and most importantly, our team. Furthermore, we are not just talking about AI. We have already integrated it throughout our business, including product, technology, and marketing. Additionally, we have a relatively untapped opportunity in the mobile gaming sector with Guru Shots and AI Art Master that are based on our acquisition of Guru Shots in 2022. Before closing, I want to underscore that Zedge is fortunate to have Guru Shots as a member of our family. As you know, Guru Shatz is headquartered in Tel Aviv and Zej stands firmly with Israel. We are appalled by Hamas's barbaric behavior and our hearts go out to the victims of Hamas's heinous attack and the victims' families and friends. I want to thank our employees and remain humbled by your courage and commitment, especially in the face of terrorism, rocket fire, army mobilizations, school closings, and the like. I would like to turn the call over to Yi, who will review our financial results. Yi?