Paltalk, Inc.

All of our attention and effort to optimize our platforms and streamline our costs have paid off and improved our foundation. Our infrastructure is capable of supporting additional business, so if we continue to expand revenue, we are confident that it would result in increased profitability. We believe that this business scalability, along with the $13.7 million in cash on our balance sheet at the quarter's end, puts us in excellent position. We have already met one of our key objectives for 2023 with our return to increased revenue. Additionally, as we surpass the one-year anniversary of our asset acquisition of ManyCam and with the successful integration of ManyCam into PalTalk and our team's effort in developing a new and easier-to-use version, we expect the one-year annual auto renewals of existing ManyCam subscriptions to help contribute to growth and subscription revenue in future periods. While our trial against Cisco was pushed back to an expected trial date in the fourth quarter of 2023, the court recently denied Cisco's motion for summary judgment, and we look forward to continuing to defend our intellectual property. We are proud that we already reached some of our stated near-term business objectives as we achieved almost 12% revenue growth and return to profitability with positive net income during this second quarter. Our additional near-term business objectives are as follows. Leveraging our recently completed integration of ManyCam product into Paltalk product through upselling initiatives. Further optimizing marketing spend to effectively realize a positive return on investment. Developing a new and easier to use version of ManyCam that will be optimized for both consumer and enterprise applications. Continuing to explore strategic opportunities including but not limited to potential mergers or acquisitions of other assets or entities that are synergistic to our businesses. Continuing to develop our consumer application platform strategy by seeking potential partnerships with large third party communities to whom we could promote a co-branded version of our video chat products and potentially share in the incremental revenues generated by these partner communities, continuing to defend our intellectual property. I trust this gives you some insight into the company initiatives we have implemented in order to conserve cash as we look to increase our subscribers and user engagement and return to positive cash flow and profitability to build stockholder value. Now I'd like to pass it to Kara for a financial summary for our second quarter ended June 30th, 2023.

Thank you, Jason. Our results of operations for the three months ended June 30th, 2023 were as follows. Revenue for the three months ended June 30th, 2023 increased by nearly 12% to 3 million compared to 2.6 million for the three months ended June 30th, 2022. This increase was attributed to an increase in virtual goods revenue as well as a full year of sales from ManyCam. These increases were partially offset by a decrease in advertising revenues of 15%. Loss from operations for the three months ended June 30th, 2023 decreased by 73% or 0.8 million to a loss of 0.3 million compared to a loss of 1.1 million for the same period in 2022. The decrease in the loss was attributed to the increased revenue. Net income for the three months ended June 30th, 2023 was 0.1 million compared to a net loss of 1.1 million for the three months ended June 30th, 2022. The improvement is attributed to the increase in sales, reduced expenses, and to the recording of 0.3 million net recognized in connection with the company's recording of a refundable employee retention tax credit. Adjusted EBITDA loss for the three months ended June 30th, 2023 decreased by over 98% or 0.9 million to an adjusted EBITDA loss of $15,000 compared to adjusted EBITDA loss of 0.9 million for the three months ended June 30th, 2022. Currently, the company has no long-term debt on its balance sheet. We'd now like to move on to questions that were previously submitted. The first question, can you comment on why the Cisco WebEx trial has been delayed twice and pushed out to December?

Like any plaintiff in a lawsuit, we are subject to the scheduling of the court as they control the calendar. We're pleased that the court denied Cisco's motion for summary judgment and stated that the trial is expected to be reset for December.

Are you still actively looking at bolt-on acquisitions? Can we expect something by the end of 2023?

We are still active and are looking for the right acquisition with our advisors at Roth Capital. And although we'd like to complete something as soon as feasible, we will not rush the process. We are committed to finding a deal that will enhance shareholder value.

The last question. When will ManyCam be marketed to PalTalk and CamFrog subscribers?

Well, we recently launched a version of PalTalk that has ManyCam functionality, and we continue to message users about the numerous benefits of ManyCam.

Thank you. Jason, back to you to close out the presentation.

Thanks, everyone, for your support and for joining us today. We are very grateful for your interest in our business. We look forward to updating the market and our stockholders with our progress and our business objectives, patent litigation against Cisco WebEx, with the trial now expected to start in the latter part of the fourth quarter, and potential strategic accretive acquisitions, which we continue to identify and analyze. Have a great day.

Thank you. This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.