LiveOne, Inc.

Ladies and gentlemen, thank you for patiently waiting. We will be starting momentarily. Thank you for standing by. Ladies and gentlemen, welcome to the Live One NQ for Fiscal 2025 Financial Results and Business Update webcast. All lines have been placed on mute to prevent any background noise. After those speakers' remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again. Thank you. I will now turn the call over to Ryan Carhart, CFO. Ryan, you may begin.

Thank you. Good morning and welcome to Live One's business update and financial results conference call for the company's fourth quarter and fiscal year ended March 31st, 2025. Presenting on today's call with me is Rob Ellen, CEO and chairman of Live One. I would like to remind you that some of the statements made on today's call are forward-looking and are based on current expectations, forecasts, and assumptions that involve various risks and uncertainties. These statements include but are not limited to statements regarding the future performance of the company, including expected future financial results and expected future growth in the business. Actual results may differ materially from those discussed on this call for a variety of reasons. Please refer to the company's filings with the SEC for information about factors which could cause the company's actual results to differ materially from these forward-looking statements including those described in its annual report on Form 10-K for the year ended March 31, 2024, and subsequent SEC filings. You'll find reconciliations of non-GAAP financial measures to the most comparable GAAP financial measures discussed today in the company's earnings release, which is posted on its investor relations website. The company encourages you to periodically visit the investor relations website for important content. The following discussion, including responses to your questions, contains time sensitive information and reflects management's view as of the date of this call, July 3rd, 2025. And except as required by law, the company does not undertake any obligation to update or revise this information after the date of the call. I'd like to highlight to investors that this call is being recorded. The company is making it available to investors and media via webcast, and a replay will be available on its website in the investor relations section shortly following the conclusions of this call. Additionally, it is a property of the company and any redistribution, transmission, or rebroadcast of this call or the webcast in any form without the company's express written consent is strictly prohibited. Now, I would like to turn the call over to Live One CEO, Rob Ellen.

Good morning, everyone. This is Rob Ellen, CEO and Chairman of Live One. I want to thank you, everyone, for joining. This has been a pivotal year for the company. The company has been transformed in some of their deals with Tesla and has come out stronger than we even expected. We have delivered 100. First, I'm going to talk about today's numbers, and then I'm going to talk about the future and some of the really exciting moonshots that the company is now focused on. Our financial performance, we did over $112 million in revenues, $108 million on our audio business, and delivered $18 million of EBITDA, $6 million above what we had gotten the street to only two months ago. Our podcast business did over $52 million from $38 million last year. This quarter alone was $14 million and an EBITDA of over $900,000. We just raised our guidance to $55 to $60 million with $3.5 to $5 million of EBITDA. Other highlights from our podcast business, we have now had six straight months of being a top 10 podcaster in the world. We have over a billion impressions across our network. We have 46 new podcasts in the last 24 months and passed 200 plus total. with a robust pipeline of over 100 new podcasts in the pipeline today, and we're adding almost one a month. We also have 17 potential acquisitions in the podcast industry that we are looking at as we continue to roll up and consolidate the business. As you got to meet Ryan earlier, Ryan has done a brilliant job of stepping in as CFO and made some very transformative financial moves including replacing east west bank seven and a half billion dollar credit line with jgb a partner of ours for four years previously has come back in with a credit facility of up to 27 and a half million dollars giving us an opportunity of having on performance the biggest cash position we'll ever have we've eliminated over 10 million dollars in short-term liabilities. We've cut one-third of our staff at Slacker Radio and over 70% of our cash at CPS. With over $40 million in total costs, this is the reason that our EBITDA was able to outperform even our own guidance. Now I'm going to talk about the future. The future is pretty remarkable. Added 2 million Tesla cars. We've now converted over 1.3 million. We now have a over 1.5 million subscribers and ad-supported users. We've launched two massive partnerships with Amazon over $16.5 million and with a Fortune 250 company for over $25 million. We have 75 additional B2B deals in the pipeline. We're now at almost a $50 million run rate on those new partnerships across five new B2B deals. We're expecting to launch our biggest B2B partner potentially in the history of the company with almost 10 X subscribers to Tesla. And that first phase will be launched in August. As we continue to look at the future of technology, as most of you know, my background is taking media companies and finding transformative technologies. I will be focusing almost all of my energy on AI and on web three crypto initiatives. On the AI side of it, we have been able to cut dramatic costs, including one third of our costs at Slacker Radio by adding AI and be able to utilize hosting and be able to utilize marketing. With that marketing, we have just started our first campaign to start to advertise in conjunction with DAX, the largest programmatic advertising in the world, And our fill rate on our Tesla users is over 50%. We are about to launch our second phase of that initiative to start converting, utilizing AI to convert those subscribers, to convert those users into subscribers. As we look at our Web3 crypto initiatives, the starting point was to build a renowned group of crypto experts, with Steve McClurge joining our team who started the first ETF in the history of Web3, Steve Lehman on the board of Coinbase, and Lou Kerner, one of the great analysts at Goldman Sachs, who started Crypto Monday. We have just launched the first ever podcast network focused on Web3 and crypto, we see a massive opportunity for us to acquire and start new initiatives in the podcast space with over 75 potential podcasters in the crypto space right now in our pipeline, as well as using AI initiatives to create our own original IP and initiatives in this space. to show our confidence and our belief in how weak our stock has been and how undervalued it is. The company has just bought back over 350,000 shares of LiveOne and over a million shares of PODC. We will continue that buyback as we have over $6 million, just under $6 million of additional room in our buyback and show our confidence in the company and explore all options to add to our holdings in both of those companies. As LiveOne continues to demonstrate our ability to be nimble, our ability to fight through difficult times, our ability to utilize technology to transform the industry, this is the most exciting time that we've seen in the history of the company. And with a balance sheet to really be able to grow aggressively the business, We see this as extremely exciting year going forward, and we look forward to talking to you at the end of the next quarter. So thank you everyone for joining, and we look forward to an update shortly. I'd like to hand it off to Ryan. Ryan is our new CFO, and as I stated, he's just done an absolutely brilliant job of maneuvering with placing East West Bank on the difficult circumstances and doubling our credit, or more than doubling our credit facility, literally within weeks of finding out that East West Bank was pulling their line. So, Ryan, with that, I'd like to hand it off to you and thank you for your help.

Thanks, Rob. I'll spend just a few minutes providing a very brief overview of our results for the fourth quarter of fiscal 2025 and the fiscal year ending March 31st, 2025. beginning with our quarterly results consolidated revenue for the three month period and in March 31 2025 was 19.3 million. Our audio division posted revenue for key for of 18.2 million and adjusted EBITDA 4.1 million consolidated adjusted even for the fourth quarter of fiscal year 25 was 1.1 million. On the US GAAP basis, LiveOne posted a consolidated net loss of $10.9 million or $0.07 per diluted share in Q4 2025. Our full year fiscal 2025 results posted consolidated revenue of $114.4 million and adjusted EBITDA of $8.4 million. Our audio division posted full year revenue of $108.9 million and adjusted EBITDA of $18.2 million. Additionally, I'm excited to announce, as Rob noted, that we completed our financing after year end with our partners at JG Capital, which replaced our East West Bank line of credit. This will help facilitate the growth of our business and position us for the future. We are excited about the potential of the opportunities in our business development pipeline and are poised to see growth forward with these opportunities. Further, our growth in the Podcast One subsidiary is expected to continue, and we expect to see a tremendous year ahead for them.

Rob, I'll turn it back to you. And just to wrap up and thank you, Ryan, our B2B initiatives are really starting to move in place. As we said, over five B2B partnerships signed, over $50 million in revenues, our largest potential opportunity to be launched in August. We will have partnerships this year with additional carriers, retailers, streaming networks, auto companies, and really just focused our energy around those B2B deals and really those initiatives that come with the needle that will be tens of millions to hundreds of millions of dollars over a five-year period. With that, our initiative to move into the Web3 space is moving fast and aggressively. You'll continue to see additional names in Web3 joining our platform, as well as podcasters and Web3 Crypto joining our platform. Our AI initiatives have allowed us to make substantial cuts in the business. We have over 500 music channels. We used to have over 120 hosts. We now have a handful of hosts that are able to host those. We also are very excited about our TV and film initiative. We sold our third television show, third podcast, Moving to second windows to television. As you start to see the dynamics of where podcasting is going and how much is moving to video. As we sell these to television, these are brand new revenue streams that could be tens of millions of dollars with zero additional costs to the business. We're going to continue to buy back stock. We're going to continue to strengthen our balance sheet. We're going to continue to strengthen our B2B deals. And we look forward to a really exciting year. And I want to thank everyone for joining. and open up for any questions.

At this time, I would like to remind everyone in order to ask a question, press star, then the number one on your telephone keypad. And if you would like to retry your question, just press star one again. Thank you. We'll pause for a short moment to compile the Q&A roster. And your first question comes from the line of Sean McGovern from Rod Capital Partner. Sean, please go ahead.

Thank you. Hi, Brian. Hi, Rob. A couple of questions on some of the details that you talked about. Rob, when you say fill rate of over 50%, can you just clarify what exactly that means from a financial standpoint?

Yeah, I can't give too much details yet on the financial on what the revenues are going to be. You'll see that shortly because we haven't put out guidance, but we will at the end of the next quarter. But what it really means is really simply, Sean, is that 50% of that inventory is being filled now, and it's well over 50, but 50-plus percent of the inventory that previous was zero. Now, that does two things, right? Number one is it drives revenues, but number two, it also is that is the setting the stage, right? Spotify claims that 60% of their subscribers, free supporters and the reason they have free, right, convert to paid eventually. One of those reasons is that some people don't like advertising. Some people do, right? So hopefully we'll start to convert through that. And that'll be the first phase of the next big AI initiative, which is going to be launched imminently is to really press to convert as many as possible of these to paid subscribers as well. And I think that 50% inventory will go, go to, you know, 75 very quickly. And as you know, our partner in that is DAX, which is the largest programmatic advertiser in the world.

Right. So the 50% refers to the inventory of available advertising account.

Correct.

So I understand that. Okay. And at the moment, right, you're still broadening the funnel and getting advertising driven. But at the moment, there are not a significant number of paid subscribers. Is that the right way to interpret it?

No, I mean, I wouldn't say that at all. I mean, we have, you know, we have added the 1.5 plus million, right? We have well over 250,000 paid subscribers, right? Now is going to be the time we're really going to be pressing to convert, you know, a sizable amount. And hopefully we can convert anywhere from 25 to 30% of them over the next year. If we do, it'll be very, very substantial revenues to kick back in as you do that.

Okay. Thanks for clarifying that. I'm shifting gears for a second. So when you're talking about things like Web3 and crypto, are you talking primarily about podcast content or is it something else?

Yeah, I mean, I can't get into much more detail than that, as you know, Sean, right? But what I would say to you is, as Steve McClurge has joined and Steve's background is running on the first ETF and selling it to Coinbase, right? Um, and Steve Lehman sits on the board of Coinbase, right? Um, we have, we have, uh, very aggressively moved in this space and that there's only three megaphones to the web three crypto industry, which is Twitter, YouTube, YouTube, and podcasting. So the first phase of that is we've just announced our podcast network where we will start to both create our own hosts and our own IP. right using ai to create those and second is we'll be acquiring just like we do the rest of our podcast we were building a community of crypto podcasters in there and then you know the opportunity right to do much more uh with web3 is certainly there for us to to expand and when you have a community of our size that you have a billion impressions there's certainly tremendous opportunity to expand that opportunity financially

Okay. But just to be clear, just because I'm a novice at this, you're not talking about getting directly into the crypto business, mining or trading or exchanges. You're talking about around content, right? And being a content for information.

Yeah. Again, I can't answer much more. We're not going into the mining business for sure. But the tokenization business, right? As you're watching the Robinhood announcement and what the stock did, right, and tokenization. Tokenization of podcasters is really interesting, right? And, you know, and there's just tremendous opportunities of where we can go with this and what we can leverage by being one of those megaphones. And when you have a billion impressions a month, right, and the kind of downloads we have, we just have a huge influence over it. And our demographic and audience certainly fits in with the Web3 crypto audience in a very unique way.

OK, last question and I'll jump back into Ryan. When will the 10K be filed?

Yeah, it should be filed. We're hoping early next week. You know everything is. Everything is there. We're just waiting to others have to just do some documentation to wrap it up so it's it's in final form. We're just waiting for them to do that and then we'll get it out to early next week.

Alright, thank you very much.

Again, if you would like to ask a question, press star, then the number one on your telephone keypad. And our next question, again, from Sean McGowan from Route Capital Partner. Sean, please go ahead.

Yeah, they jumped in too quickly there. So, Rob, to the extent that you can, can you talk about any change in the types of deals, you know, some new deals that you're working on versus what you've talked about before? It's not a good job laying the table for, setting the table for what areas you might be looking at. Is there anything new that you can add, anything different from what we've talked about before?

Yeah, I'm sorry, you're cutting out a little bit, Sean, but you're talking about the B2B deals?

Yeah, yeah. We talked in the past about the kinds of verticals, you know, but they were different from what we kept up before.

Yeah, this is the most exciting time maybe in the history of the company now, probably since the original Tesla deal, which when it first started was only a couple hundred thousand dollars, right? You know, Tesla has 2 million subscribers. We'll be launching with a partner that has 10 times the amount of subscribers. And we're in deep conversations, as I've described before, where I fully expect the momentum is now building, where after you land a $25 million deal with 16, half a million dollar deal with Amazon, the momentum is building in the direction, very much like I built Digital Turbine and I built my other companies, right? You're feeling that momentum that across carriers, across auto companies, across retailers, across streaming networks, cable, satellite, anyone with $10 million to 3 billion eyeballs like Facebook, who has a need for a subscription product, which we're just watching everybody going in, right? You watch Walmart go into Vizio, right? And you're watching Amazon go into music and film and television. Everybody's businesses are now infringing and crossing over them. We're one of 10 DSPs left on earth. You just watch an app just sell for $200 million. They were doing one-fourth of our revenues, right? You watched Tidal sell a couple of years for $450 million. They then made a dime. So we're really well positioned here that both on the B2B side as well as a potential partner or potential buyer of one or both of the businesses, as we publicly stated, is very much timely right now. You're starting to see that momentum keep back up in the industry and huge interest around this. okay thanks um and then my last question is uh is there anything new on the discussions with us with that relationship i think it's changed some money and no you know no i mean it's kind of a beautiful thing i mean you know if you go to almost any tesla car now you know and you know a lot of people have called me and it's it's it's really we're really proud of this sean It's like we used to have a little red button, right? And we had a great subscriber number, right? We got paid $3 a month when the industry was moving up to $12 a month, right? And it was beautiful. You made some money out of it. But we really got no branding. We got no database. And now today is if you go into almost any Tesla car, you're going to see the LiveOne logo. So they're building brand value there. Think about your phone and seeing on your phone. And if you saw LiveOne on the front of your phone every single time, what that means to you, right? I'm really proud of the fact that somehow we converted 1.3 million out of 2 million cars have converted, right? It's a staggering number. It's almost unheard of, especially when you got competition from Apple and Cirrus and so on. It shows the appreciation and respect for the product, right? And the brand. And then they're using it for an average of like 40 minutes, multiple times a day. So you can see that, you know, how much people really enjoyed how much respect they have for the brand and why it fits with their needs. Um, I think the next component of that is, is that we now have advertising that we've never been able to talk to those consumers. Now we're talking to them. And then last but not least, and maybe the most important part is we never controlled the database, right? Sean, you would be the number 1.25 million, right? Now it's Sean McGowan. who lives in Orange County or now in New York, right? Your age, your credit card. So we're actually building a real relationship and real foundation for a database that can be worth a fortune. Like think about what that database batch actually having a million, three wealthy Tesla owners as subscribers and knowing the demographics and knowing where they're from. So it's really exciting. It's really exciting. It's obviously, it takes time to bring those revenues back up. Right. And, bring some of those profits back up. But from our standpoint, if it is, this is what we've always hoped for. We hope for the opportunity to be able to take those RPOs up from $3, right? Which are 12 years old. It'd be like owning a piece of real estate on the ocean and you're renting it for $3 a month, but you can never, never raise your rents, right? Now we own the real estate. We can raise the rent. So our RPOs are up from $3 to five. Now we got to really aggressively market. You're going to see it coming. very, very aggressively. You're going to see us marketing to convert those people and then literally starting in the next couple of weeks.

Great. Thanks. I just remember.

And your next question comes from the line of Brian Kinslinger from Alliance Global Partners. Brian, please go ahead.

Hi, Rob. Thanks for taking my question. Just one. I wanted to understand If I heard you right in August, you hope to launch your largest B2B deal with a bigger subscriber base or bigger base of consumers than Tesla. Is that a signed deal already? Something you're hoping to announce in June then? And when does revenue generate and how does that ramp?

Yes, as we've said before, Brian, we've already signed other deals, right? This is an actual launch, right? Does that mean it'll work? You never know, right? But we're highly confident. And I think Tesla is profitable, is profit to literally showing, right, how magnetic this technology is and what our platform does. But we'll be launching with a partner that has over 10 times the amount of subscribers, right? And you can start to guess numbers and figure it out, but we're not going to do that today. What we're going to do is we're going to very confidently right do that just like we did with tesla years ago we have a high level of confidence that this will be uh potentially be our biggest partner in history and that we have an opportunity that proving that tesla that this number of people converted again shows the affection for our product and i think that's why these b2b deals are starting to start to fall and get signed so stay tuned you're going to be a lot more value

So the August 1 is signed and you hope to launch, is that right? Correct. And have you announced who that is or can you not announce who that is? We cannot announce yet who it is, but you will see shortly. Okay. Thank you.

Again, if you would like to ask a question, press star, then the number one on your telephone keypad. There are no further questions at this time. I will now turn the call over to Robert Allen for closing remarks. Robert?

Thank you, everyone. I appreciate the time and I appreciate your support, and we look forward to a terrific year. We look forward to talking to you again shortly about the next quarter.

This concludes today's call. You may now disconnect.