Spok Holdings, Inc.

Greetings and welcome to the Spoke Holdings first quarter 2026 earnings results call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce Al Galgano, Investor Relations. Please go ahead.

Hello, everyone, and welcome. Today I am joined by Vince Kelly, Chief Executive Officer, and Michael Wallace, Chief Operating Officer and Chief Financial Officer. After a brief presentation by management, we will open up the call to your questions. But before we begin, I want to remind everyone that today's conference call may include forward-looking statements that are subject to risks and uncertainties relating to spokes future financial and business performance. Such statements may include estimates of revenue, expenses, and income, as well as other predictive statements or plans which are dependent upon future events or conditions. These statements represent the company's estimates only on the date of this conference call and are not intended to give any assurance as to actual future results. Spokes' actual results could differ materially from those anticipated in these forward-looking statements. Although these statements are based upon assumptions that the company believes to be reasonable, they are subject to risks and uncertainties. Please review the risk factor section relating to our operations and the business environment which are contained in our first quarter 2026 form 10Q and related documents which will be filed with the Securities and Exchange Commission. Please note that SPOKE assumes no obligation to update any forward-looking statements from past or present filings and conference calls. With that, I'll turn the call over to Vince.

Good afternoon. Thank you for joining us for our first quarter 2026 earnings call. Let me preface my comments by saying that SPOKE remains true to our mission, and I believe with the actions taken a couple weeks ago, we have positioned SPOKE for even greater success in the future. With our strategic pivot we announced about four years ago now, our focus has not changed. That is to increase our software revenue, generate cash, and return capital to our stockholders. In the first quarter, we were able to deliver a nearly 57% year-over-year increase in software managed services revenue, as well as a continued increase in our wireless average revenue per unit. Additionally, we generated nearly $2 million of net income and $5.3 million of adjusted EBITDA. Our ability to generate net income in various economic environments results from the financial platform our team has created. With over 80% of our revenues generated from reoccurring revenue streams, including software maintenance and subscription contracts, managed services, and wireless paging revenue, and a debt-free balance sheet, we can provide a consistent and predictable revenue stream. We believe that SPOKE has struck an excellent balance between making the necessary investments to fuel future growth while continuing to generate cash flow and return capital to our stockholders. While driving our top line, we also continue to focus on expense management as operating expense levels in the first quarter were essentially flat to the prior year. Additionally, a couple weeks ago, we announced a strategic realignment to create even more efficiency and take advantage of artificial intelligence technologies to drive increased profitability and cash flow. However, it's important to note that our focus on expense management as one of the key drivers to generate increased cash flow does not come at the expense of our product platform as we continue to make the necessary investments in product development, sales and marketing, customer support, and professional services to support the growth of our Spoke CareConnect solution offerings. In the first quarter of 2026, Spoke invested almost $3.5 million in product research and development, a nearly 12% increase from 2025. Investments such as these are critical to creating a best-in-class product platform and to maintaining our solid industry reputation. And while software sales are always going to be lumpy quarter to quarter, our investments are already paying dividends. The software operations bookings for the second quarter We're off to an excellent start and have already exceeded the levels we saw in the entirety of the first quarter. I look forward to sharing those results with you when we report our second quarter performance in July. Today, we'll share with you an update on how our strategic business plan is progressing in support of our goals, as well as our financial results for the quarter and the full year. I'll start by reviewing the agenda for today's call. The order will be as follows. First, I'll provide an overview of our strategic realignment announcement and capital allocation strategy. Next, Mike Wallace, our COO and CFO, will provide a review of our first quarter sales performance and review our financial highlights, including spokes financial expectations for 26. Finally, I'll conclude our prepared remarks with a brief wrap-up before opening the call to your questions. As you may have seen, a couple weeks ago we announced a strategic realignment designed to reduce costs and sharpen operational focus across our go-to market functions. These actions will enable us to allocate resources toward continued investment in our CareConnect suite and artificial intelligence initiatives while sustaining our commitment to returning cash to stockholders. After extensive analysis by our management team and advisors, with the support of our we are confident that this strategic shift will create significant value for stockholders while continuing our quarterly dividend, which currently represents a yield in excess of 10%. As part of the plan to realign and streamline spokes leadership structure, we're reducing our workforce by approximately 10%. As a result, this will reduce headcount related expenses, excluding stock-based compensation and other operating expenses by over $6 million on an annualized basis. Related to this reduction in force, we estimate that we will incur restructuring charges, excluding stock-based compensation, of approximately $1.6 to $2 million. These charges will primarily be taken in the second and third quarters of 26. We expect that the restructuring charges will be substantially completed by the third quarter. While any reduction of our leadership team and employee base is a difficult decision, we believe these reductions will help us continue to drive productivity and efficiency maintain profitability, and streamline our organizational structure. This includes implementing artificial intelligence technologies to further optimize our processes and workflows both internally and externally. As part of this realignment, we are consolidating our executive team for efficiency. Michael Wallace, our Chief Operating Officer, will take on the additional role of Chief Financial Officer. As you know, Mike has been with Stokes since 2017 and has served as the company's chief financial officer from 2017 to 2022, so we're able to maintain continuity in our management structure. We believe that the announced strategic realignment was the right thing to do in order to sustain our mission. We are firmly committed to maintaining profitability levels while returning value to our stockholders. Before I turn the call over to Mike to review our sales and financial performance, let me briefly summarize the goals that support our critical and important mission. Our strategic goal is simple. Run the business for profitable growth, generate cash flow, and return that capital to stockholders. Spoke has a proud legacy of creating stockholder value and returning capital through free cash flow generation, and we intend to continue this track record. Our dividend level represents a significant yield for our stockholders and we are proud of our legacy there and our ability and commitment to continue funding it. Since the beginning of our strategic pivot, which started four years ago, Spokas returned approximately $112.3 million, or more than $5.38 per share, to our stockholders in the form of our regular quarterly dividend. In fact, since we created this company in 2004, Spokas returned more than $735 million to our stockholders, either through our regular quarterly dividend special dividends or share repurchases. In the first quarter of 2026, our history of returning cash to our stockholders continued as we returned $8 million in dividends. Our dividend level in the first quarter is typically a little higher than the out-quarters of the year due to vesting of our incentive plan grants. Dividend levels in the following three quarters will total approximately $6.5 million per quarter, so we expect to pay dividends in excess of $27 million in 2026. Spoke remains committed to our dividend policy and returning capital to our stockholders. When you take into consideration our current cash balance, distribution to stockholders, share repurchases, debt repayments, and acquisitions, Spoke has now generated nearly $1.1 billion of free cash flow since our creation in 2004 and returned the majority of it to our shareholders. Our focus on maximizing cash over the long term supports the four major tenets of our strategy. Those are, number one, continued investment in our wireless and software solutions. Number two, growing our revenue base. Number three, disciplined expense management. And number four, a stockholder-friendly capital allocation plan. Going forward, we believe our extensive experience operating an established communication solution and world-class customer base will continue to create significant value for our stockholders. Now I'll turn the call over to our Chief Operating Officer and Chief Financial Officer, Mike Wallace, who will talk about our operational accomplishments and financial performance. Mike?