GameSquare Holdings, Inc.

Good afternoon and thank you for joining us for the GameSquare Holdings' 2026 Second Quarter Conference Call. On the call today, we have Justin Kenna, GameSquare's CEO, and Mike Munoz, CFO. During the call, all participants are in listen-only mode. Following the presentation, we will conduct a question and answer session. Before management discusses the results, I'd like to remind everyone that certain statements in this call may be forward-looking in nature. These include statements involving known and unknown risk and other factors that could cause actual results to differ materially from those expressed or implied in our forward-looking statements. For information about forward-looking statements and risk factors, please see our 10-K for the quarter ended June 30th, 2026, which will be available on the company's website or with the Securities and Exchange Commission. I will now turn the call over to GameSquare CEO, Justin Kenna. Justin, please go ahead.

Thank you, and good afternoon to everyone joining us on today's call. GameSquare delivered a strong second quarter that marked an important step forward in our financial performance. Revenue increased 137% year-over-year to $18.5 million, gross margin expanded by nearly 20 percentage points to 49%, and adjusted EBITDA improved to a second quarter record of $1 million. These results were ahead of our expectations, and represented a meaningful acceleration from both the first quarter and the prior year period. Most importantly, our second quarter results demonstrate that GameSquare is generating profitable growth from its underlying operations. Our performance also reflects the strength of the integrated platform we've built and the early benefits of recent acquisitions, including Qlik and TrueBuddy. Qlik has expanded our creative marketing, talent management and campaign execution capabilities while TubeBuddy adds a high-margin technology and SaaS layer that supports creators and publishers with workflow analytics, optimization, and AI-enabled tools. Together with StreamHatch's data measurement and creator intelligence capabilities, these businesses position GameSquare as a differentiated entry point into the creator economy, helping brands and publishers identify the right creators, Activate campaigns, optimise content and measure performance through a single platform. Our second quarter results are encouraging and we're excited as we enter the seasonally strong second half of the year. So I want to use my time today to review our second quarter performance in more detail, discuss the progress that we're making across the business and provide an update on our expectations for the balance of 2026. GameSquare's profitable growth in the second quarter demonstrates that our operating strategy is producing the intended results. As revenue scales, a higher margin business mix and prudent operating expense management are drawing meaningful operating leverage across the platform. This progress reinforces our confidence in the scalability and earnings potential of our operating model. When combined with our strong financial position, we believe we have the resources, and flexibility needed to continue investing in high return growth initiatives, including technology, premium intellectual property, creator relationships and other opportunities that can deepen customer engagement, expand margins and create long-term shareholder value. Talent remains an important growth engine for Gamesquare and a key differentiator of our platform. During the second quarter, we continued to expand Klik's roster with the signing of CypherPK, one of the world's largest and most influential gaming creators. Cypher reaches more than 20 million followers and subscribers across YouTube, Twitch, Instagram and other major platforms, making him Klik's highest profile creator addition to date. The addition of Cypher builds on the momentum we discussed last quarter. including the appointment of Justin Miclat as Chief Growth Officer of Qlik and assigning a stake to the second largest Roblox creator. Together, these additions have expanded Qlik's creator network to more than 60 million followers across major social platforms and increased the premium creator inventory available to our brand partners. They also create additional opportunities across brand partnerships, content live experiences, commerce and intellectual property. Our talent strategy is also expanding beyond gaming into athlete and lifestyle creators, where we are building a sizeable pipeline. A recent example is a new partnership that we were able to get for UFC athlete Max Holloway with Whatnot. These adjacent categories broaden our audience reach and create additional opportunities to monetize talent across content, commerce, sponsorships, and experiences. As we scale these relationships across GameSquare's platform, We believe that talent can drive higher-value programs, greater campaign volume, and attractive operating leverage. Our integrated platform continues to drive strong commercial momentum. One recent example is our work with Marvel on the Marvel Rivals Ignite 2026 mid-season finale. Following quarter-end, GameScope produced a four-day global esports event in Los Angeles providing turnkey production and talent management as well as monetization services across sponsorship sale, ticketing, and merchandise. The event generated approximately 699,000 hours watched, reached peak concurrent viewership of 54,600, and was distributed across 64 channels in more than five languages. The relationship is an important validation of GameSquare's platform. Marvel, part of the Walt Disney Company, trusted Gainsquare to create and deliver a major global competitive moment around one of the world's most recognized and carefully protected intellectual properties. Our team managed the event end-to-end, including event design, broadcast, tournament operations, venue logistics, sponsorship integration, talent management, and real-time measurement through Stream Hatchet. This is the type of opportunity our integrated platform was built to support, by helping leading IP owners activate and monetize their properties across live experiences, content, creative sponsorship, merchandise, and data-driven measurement with one partner accountable for execution. The successful mid-season finale also positions us to build on the relationship as the Marvel rivals competitive season advances toward the Ignite Grand Finals later this year. Beyond Marvel Rivals, we have booked a broad range of additional high-profile projects that we expect to contribute to second-half revenue growth, including a new relationship with Tencent within our influencer marketing business, our selection to produce the first ever Innovation Awards at the upcoming Roblox Developer Conference, support for a Red Bull event featuring our newly signed talent, CyberPK, and a renewed relationship with REP for 2027. We also expect the second half to benefit from the expansion of Fade Esports, new strategic marketing services and creator and community activations in conjunction with TikTok for an upcoming NBA gaming crossover event in LA with leading NBA talent. These projects add to recently announced wins with Riot Games, the Esports World Cup, the US Army and Corsair. More broadly, Gamesquare has developed a proven track record bringing to life leading gaming entertainment and sports IP, including work with Fortnite, Roblox, Marvel Rivals, Lego, and the Dallas Cowboys. Across these relationships, we combine creators, content, live production sponsorships, experiential execution, data and measurement to create compelling fan experiences and commercial programs. This capability is becoming an important differentiator and a source of larger repeatable opportunities across our ecosystem. Our recurring client relationships are also strengthened. Our agency of record clients have maintained a 100% renewal rate to date in 2026 and our content division is on track for a record year supported by work for TurboTax, HyperX, Roblox and Marvel Rivals. In parallel, we are expanding access to premium IP and commercial rights through World of Dance, The Esports Awards and the Mobis, creating differentiated inventory that can be monetized across multiple parts of the games ecosystem. We are encouraged by the visibility we have into the seasonally strongest second half of 2026. Our confidence is supported by booked programs across Games Square Experiences, influencer marketing, our content team, esports, talent and technology, as well as a growing pipeline of global brands, publishers and IP owners. Historically, approximately 60% of our revenue has occurred in the second half of the year, and current activity reinforces our confidence in our full year plan. We are also expanding our creative and strategy capabilities in the UK with the addition of Tom Wilde, who brings experience from Publicis and Mindshare. This strengthens our ability to serve clients across Europe and supports a disciplined international pipeline. We are also developing opportunities in additional markets, including the Middle East, and will pursue expansion where we can leverage our existing platform efficiently and, importantly, profitably. Our talent pipeline and technology products provide additional growth opportunities. Qlik's expanding roster creates new brand partnerships, content, commerce, and experiential opportunities, while Stream Hatchet's creative communities extends our capabilities from analytics into creative discovery, activation and campaign management, and performance reporting. We expect initial commercialization efforts to begin contributing during this second half. TubeBuddy is also showing encouraging early results from its new AI-powered video ideation tool, which uses creators' proprietary channel data, audience comments, and identity to generate personalized data-backed recommendations. Since active marketing began in early July, TubeBuddy has experienced approximately 10% increase in new subscribers, while users who activate the feature have converted to paid subscribers at roughly 10 times the rate of non-activated users. These results support our view that AI-driven product innovation can support engagement, conversion, and recurring technology revenue. Together with StreamHatchet's creator intelligence and campaign measurement capabilities, ShoeBuddy strengthens GameSquare's position as an entry point into the creator economy for brands, publishers, and creators. Collectively, our book programs, Recurring Customer Relationships, Expanding Talent, Pipeline and developing technology offerings provide meaningful visibility into the balance of the year. We expect to announce additional customer wins, creative relationships and commercial partnerships over the coming months. Combined with improving operating leverage, this pipeline reinforces our confidence in continued growth and, again, importantly, profitability. As GameSquare's operating platform continues to scale and generate improving profitability, our capital allocation strategy is also evolving. Our objective is to allocate capital towards the opportunities we believe offer the most attractive risk-adjusted returns and the greatest potential to create long-term shareholder value. We remain optimistic on the long-term potential of EASE and other digital assets, as well as revenue opportunities from a growing pipeline of Web3 and on-chain customers. At the same time, we recognize that digital asset values can be volatile and are largely influenced by external market conditions. As a result, we tend to opportunistically monetize portions of our digital asset treasury when we believe the capital can generate a more attractive return elsewhere. We started to do that, which is hopefully being evidenced by the PR around some of the liquidity within our e-holdings and also our recent buybacks within our share repurchase program. Our current priorities include repurchasing GameSquare shares when we believe they trade at a meaningful discount to the underlying value of the business and investing in high return growth initiatives across our operating platform. These uses of capital are more directly within our control and allow us to leverage the capabilities customer relationships and intellectual property we've built to drive revenue growth, margin expansions and increased profitability. Since the beginning of our repurchase program, we have repurchased more than 8.8 million shares for approximately $4.1 million, including 2.8 million shares during the second quarter and an additional 1 million shares in July. We believe repurchasing shares at attractive valuations can be highly accretive can be a highly accretive use of capital, particularly as the underlying operating performance of the business continues to improve. Ultimately, our approach is not based on maintaining a fixed allocation to any one asset class. We will continue evaluating the relative return potential of our DAT, share repurchases, organic investments, and strategic opportunities, and we'll deploy capital where we believe it can create the greatest value for shareholders. In addition to deploying capital thoughtfully, We are taking steps to preserve the flexibility needed to support GameSquare's long-term growth. As disclosed in our recently filed proxy statement, stockholders will vote at an August 13 special meeting on authorizing the board to enact a potential reverse stock split, if necessary, to regain compliance with NASDAQ's minimum bid price requirement. Beyond supporting our continued NASDAQ listing, a potential reverse stock split provides the flexibility to support a more appropriate share price and potentially important, Games Square's appeal to institutional investors whose investment mandate may limit their ability to own lower priced securities. Overall, our second quarter results demonstrate that Games Square is building a larger, higher margin and increasingly profitable operating platform. We're encouraged by the progress across the business and believe our improving financial performance and evolving capital allocation strategy positioned us well to invest in growth while creating value for shareholders. We remain focused on disciplined execution and converting our strong commercial momentum into sustained revenue growth, operating leverage and profitability. So with this overview, I'll turn the call over to Mike to review our 2026 second quarter financial results. Mike.

Thanks Justin. Our reported results for the second quarter of 2026 reflect the strategies underway to drive profitable growth. Total revenue was $18.5 million compared to $7.8 million in the prior year period. The 137% year-over-year increase was primarily driven by the acquisitions of Qlik and TubeBuddy, as well as growth across our marketing agency and owned and operated IP operating segments. The reported gross margin for the 2026 second quarter was $9.0 million, or 49% of sales, compared to $2.3 million, or 29.4% of sales for the same period last year. The significant increase in gross margin reflects a mix of higher margin sales and our ongoing focus on profitability. Adjusted EBITDA for the 2026 second quarter was positive $1.0 million compared to an adjusted EBITDA loss of $3.2 million for the same period last year. The $4.2 million improvement reflects a combination of revenue growth, higher blended gross margin, and greater leverage on fixed operating expenses. As of June 30, 2026, we had cash and cash equivalents in digital asset treasury assets of $25.9 million. I'm pleased with the progress we are making in growing sales and improving profitability. GameSquare has a strong financial position and liquidity to pursue strategic initiatives, invest in our operating platform and return capital to shareholders. So with this overview, I'll turn the call back over to Justin.