Zedge, Inc.

Your conference will begin in just a couple of minutes. Please remain online. Your conference will begin very shortly. Good day and welcome to ZEJ's earnings conference call for the third fiscal quarter of 2026. 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, please press star then one on your touch-tone phone. To withdraw your question, please press star two. Also note, that Zedge will be presenting at the Planet MicroCab Conference next Wednesday at 2.30 p.m. Eastern Time. I will now turn the call over to Brian Segal.

Thank you, Operator. During today's call, Jonathan Wright, Zedge's Chief Executive Officer, and Isai, Zedge's Chief Financial Officer, will discuss Zedge's financial and operational results that were reported today. Any forward-looking statements made during this conference call during the prepared marks 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 calls. These risks and uncertainties include, but are not limited to, specific risks and uncertainties disclosed in ZEDGE's periodic SEC filings. 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 of the ZEDGE website, and it has also been filed on Form 8K of the SEC. Finally, on this call, we will use non-GAAP measures. Examples include non-GAAP EPS, non-GAAP net income, and adjusted EBITDA. Please see our earnings release for an explanation of our use of these non-GAAP measures. Now I would like to turn the call over to Jonathan.

Thank you, Brian, and good afternoon, everyone. Let me start with what stood out to me this quarter. We continued to demonstrate that the core Zedge marketplace business is resilient. This was a gap profitable quarter, which I think is worth noting, and the underlying monetization trends remain strong. Subscription revenue grew 32% year-over-year this as active subscriptions reached nearly 1.3 million, up 41%, marking nine consecutive quarters of year-over-year growth, while Zedge Premium GTV increased 17%. This contributed to our record quarterly average revenue per monthly active user of nearly 12 cents. What those numbers collectively tell me is that our ongoing investment in acquiring and retaining higher-value users continues to pay off. Even though overall monthly active users declined, the quality of engagement and the revenue we generate per user improved. Additionally, while advertising revenue declined slightly, the drop was entirely attributable to Emojipedia, which is being managed for profitability and cash generation in light of the structural changes Google made to its search results page. Within the Zedge Marketplace itself, advertising revenue was essentially flat year over year, and I would characterize that as a resilient result, particularly given that the prior year benefited from a one-time integration bonus from an ad platform partner. Within the Zedge Marketplace, I want to highlight one data point that I think reinforces our message about monetization quality. iOS revenue grew 35% year over year and now represents 6.5% of total Zedge marketplace revenue, up from 5.1% a year ago. iOS users are among our highest value users, and that trend is moving in the right direction, turning to data seeds. This was a meaningful quarter for the business. We fulfilled our first six-figure order, stemming from an existing customer, a leading technology company, Successfully delivering a project of this size on spec within tight timeframes is a meaningful milestone, validating our ability to secure larger, more complex orders, especially from existing customers. At the same time, our prospect pipeline is also growing. We are generating interest from leads interested in ethically sourced images, video, and audio datasets. Our ability to tap into our deep experience in creating and operating consumer mobile apps and repurposing this knowledge for managed, crowdsourced content creation that complies with regulatory frameworks is unique. We have said consistently that revenue will remain lumpy as we mature our offering, but each successful delivery strengthens our credibility in the enterprise market, and that is what builds toward larger, and more consistent deal flow over time. Turning to Tape Deck, our marketplace for independent music, where artists earn royalties directly from their fans. We have been focusing on expanding the music catalog, and I am excited to share that we recently signed Sync Music, Tough Gong Distribution, and the BWL Entertainment catalog. Sync's roster includes artists like Jason Derulo and T.I., tough gong was originally established by Bob and Rita Marley as a home for their own music and fellow independent artists. And BWL manages the estate of Betty Wright, a sole pioneer and the first woman to have a gold LP on an independent label. These are exactly the types of artists tape deck was designed to serve. And this progress increases our confidence in the direction of the catalog. Next, Our product innovation team released an additional two alpha products this quarter. We now have four live and remain on track to achieve our goal of six alpha launches this fiscal year. That will be zero to six in less than 12 months. What I want to emphasize about our framework is that it is designed to be highly efficient at scaling winners and killing losers. We pre-validate before writing code, build fast, measure against clear KPIs, invest in the winners and cut the losers. Each new launch compounds from prior releases by utilizing some of the development work, which shortens our time to market with every iteration. We are attached to the framework, not to any single product. That discipline is what allows us to take multiple shots on goal without putting meaningful pressure on the balance sheet. From a financial standpoint, Free cash flow increased 55% year-over-year to $1.2 million and is up 10% year-to-date. Cash and cash equivalents strengthened to $19.7 million, and we continue to carry no debt. During the quarter, we increased our quarterly dividend by 25% to $0.02 per share, reflecting our confidence in the business and our ongoing free cash flow generation. We also opportunistically repurchased shares when market conditions warranted and continued to invest in data seeds and our innovation pipeline. All capital allocation priorities are being pursued concurrently, and none of them is coming at the expense of the others or of the balance sheet. Stepping back, our priorities for the remainder of fiscal 2026 are straightforward. Continue strengthening monetization in the Zedge marketplace build data seeds deliberately, and execute well on the opportunities we elect to pursue, and advance our innovation pipeline in a disciplined way. With that, I will turn it over to E. Thank you, Jonathan.