STAAR Surgical Company

good morning everyone and good morning everyone and welcome to sabio holdings q2 2025 earnings call the financial statements and mdna have been filed and can be accessed through the cdar website today is wednesday august the 27th 2025 and joining us are aziz rahim tula founder and ceo and sajid premji cfo of sabio holdings They will be presenting the company's Q2 2025 results and developments, followed by a Q&A session. Analysts can ask questions live by pressing the raise hand button to unmute. Investors are encouraged to submit their questions via the Q&A box, and we will address them at the end of the session with any questions. along with any questions submitted in advance. Before we begin, I would like to remind everyone that certain statements made today may contain forward-looking statements that are subject to known and unknown risks, uncertainties, and other factors. For a complete description of the risks and uncertainties facing the company, please refer to the MD&A and other continuous disclosure filings, which are also available on the CDAR website. Also note that all figures discussed today are in US dollars, unless stated otherwise. With that, I'll turn it over to Aziz.

Thank you, Martin, and good morning, everyone. In a year without election tailwinds and terror pressures, this quarter highlights Sabia's ability to deliver strong results through consistency, innovation, and diversification, positioning us well for even greater success ahead. This quarter also reflects both the resiliency of our business and the rapid adoption of our new products, going into what promises to be a very lucrative 2026 US election cycle. We continue to maintain a 92% recurring revenue model, powerful validation of how our AppSign's data-driven approach drives positive client outcomes. In today's environment, ROI and return on ad spend matter more than ever. Our propriety 80 million cross-screen household graph delivers measurable value to both brands and agencies through better insights and outcomes. Now talking about innovation, growth at Sabio has always been fueled by anticipated shifts and executing ahead of the curve. From the building and execution of our propriety app science household graph in 2016, when mobile apps were not as prevalent and streaming apps really didn't exist, Sabio was there. Today, where our ad-supported streaming business now accounts for 60% of revenue and our largest contributor to annual growth. To our international expansion, launched in 2023, already generating meaningful revenue, where revenues are up four times year over year with tangible growth ahead and geographic diversification becoming a reality. to the explosive growth of our new programmatic product launched in 2025. In the first half of this year alone, sales grew an average of 94% month over month. and most recently, the launch of Creator Television in January of 2025. Now, one of the fastest growing creator-driven streaming channels in the streaming space today. Viewership has surged more than 300% across streaming partners, including Comcast's Zumo, Plex, Sling, Amazon Fire TV networks, with more added monthly. The creator economy is real. Category where spending is estimated to be $52 billion. Yes, I mean billion by 2030. Taken all together, our consistent revenue, rapidly adopted new products, and geography expansion are providing both predictable growth and revenue diversification. We already built one of the best ad serving technologies in Sabio, one of the best analytics engines in app science, and now have tremendous momentum building one of the fastest growing creator-inspired television networks in creative television. We are beyond excited about all we have accomplished and what more there is to come. I'm now going to hand it over to Sajid Premji to dig into the details a little bit more. Sajid.

Thanks Aziz. We are pleased to report a record second quarter revenues in our fifth consecutive quarter of double digit revenue growth. Our shift to a streaming sales model from a mobile display dependent model continued to deliver a robust compound annual growth rate, increased customer retention, and has captured substantial cost efficiencies. For the three months ended June 30th, 2025, Savio generated 11.2 million US in sales, up 25% from the prior year, or 29% excluding political sales. The increase in sales was once again fully organic and driven by strong advertising demand, broader client adoption and key verticals, and expansion into new geographies in combination with new product offerings and previous investments made. Double-digit growth rates were realized across several geographies within Savio's footprint, including from the companies New York, Los Angeles, and Detroit offices. Meanwhile, the company's advocacy business and international business out of the United Kingdom continue to demonstrate robust strength, compounding at triple-digit growth rates. By segment. ad-supported streaming sales grew 8% to a record 7.4 million U.S. compared to 6.9 million U.S. in the same period last year. Excluding political campaigns, ad-supported streaming grew 13%, marking our sixth consecutive quarter of double-digit growth in our core ad-supported streaming business. Included in second quarter ad-supported streaming sales were approximately 342,000 and programmatic ad sales recognized net immediate costs. The increase in revenues was spread across several verticals, including automotive, finance, lottery, legal and professional services, and advocacy. For the first half of 2025, Sabio's 21% growth in asset-supported streaming sales once again outpaced the estimate of 13% growth rate for the U.S. asset-supported streaming market at large as we continue to take market share. Isabio's dominant sales category, accounting for 70% of our overall sales mix in the first half, our ad-supported streaming sales feature predictable and sustained growth through very high customer retention rates. 92% of our first half sales, normalized for political sales, came from repeat customers. Additionally, second quarter mobile ad sales increased 88% to 3.5 million US from 1.9 million US in a prior year, reflecting strong adoption of Savio's new performance marketing offering and increased use of non-OTT mobile video. Savio's end-to-end technology stack. powered by a proprietary AppSci's cross-screen graph and featuring several direct supply integrations, continues to yield strong gross margins, with second quarter margins remaining consistently strong at 61%. Furthermore, programmatic ad sales recognized into consolidated revenues net immediate costs benefited gross margins by approximately 1.2%. Savio's programmatic sales typically feature lower gross margins compared to its managed service offerings, but also feature a lower OpEx profile. If the company's programmatic sales continue to make up a great proportion of Savio's overall sales mix, we expect downward pressure on margin to be gradually offset to greater OpEx efficiencies. With approximately 60 to 70% of our sales taking place in the second half of the year, the company has historically incurred first half losses followed by second half profitability. Our second quarter adjusted EBITDA loss was 1.2 million compared to a loss of 300K in a prior year's period. The loss was driven by investments in our new Creator TV, programmatic and performance marketing offerings, international expansion, which we'll also soon discuss further. Also contributing to the loss was a $532K increase in cloud computing costs over the prior second quarter as usage began to normalize from fourth quarter investments that will enhance the company's data security, capture AI-driven efficiencies, and facilitate a robust data platform for continued growth. With the heaviest investments undertaken in the first quarter, Savio saw a 15% sequential reduction from the previous quarter, despite increased business activities. Going forward, management remains intently focused on unlocking further efficiency gains within the platform. Savio ended the quarter with $2.2 million in cash. Delving deeper into Savio's newest product offerings and geographical expansion, it is clear that our investments are already paying off, with substantial benefits still to be realized over the coming quarters. Creator TV continued to expand its distribution during the second quarter. Since its launch, the channel's average viewership has grown by over 300% across several platforms, including Comcast Sumo Play, Plex, Sling, and Amazon Fire TV. Our new programmatic CTVLTT offering has seen a 94% month-over-month revenue growth in the first half of the year. Meanwhile, sales from our international business have quadrupled over the prior years, with triple-digit growth rates continuing on into the third quarter. It is also worth reiterating that our new performance marketing offering helped underpin a robust 88% surge in second quarter mobile ad sales. Finally, Sabio's sales force has grown nearly 40% in 2025 with most hires being made within the last six months. The company has already realized early returns from these investments with new logos to Sabio representing 33% of our first half brand mix. Historically, it takes close to six months before a new seller starts to contribute with a meaningful ramp up thereafter. Therefore, While we have already reached early returns through diversifying client base, the substantial benefits of our investments are expected to be realized in the second half of 2025 and into the 2026 election year is our newest sellers ramp up. Savio's debt load consists of 1.7 million in short and long-term debt instruments and 6.4 million outstanding under a three-year revolving credit facility backed by Savio sales. This facility is used to borrow against eligible accounts receivable of the company, effectively bringing the collection of receivables forward to the draw date, similar to a factoring arrangement. Savio's receivables have historically experienced a nominal loss rates due to a customer base that is largely composed of the most significant US brands in the advertising agencies. When the cash receivables are collected on, the amounts received are first directly paid towards the outstanding loan balance, which the company can then use for working capital purposes through subsequent withdrawals. As a result, the facility is continuously being repaid as AR on sales is collected upon. At quarter end, we had 50.6 million shares outstanding 3.4 million options in RSU's outstanding, and subsequent to quarter end, Sabio retired all 1.7 million Canadian of convertible notes, or approximately 1.3 million in U.S. dollar terms, through a new 1.8 million Canadian debenture financing, described in part by Sabio's CEO. The financing reduced Sabio's fully diluted share count by approximately 1.7 million. Our acquisition of Vidillion in 2022 remains our only material dilutive event since going public in 2021. Insiders own 54% of the company, with high alignment between our management team and the interests of our shareholders. Looking ahead, macroeconomic certainties continue to weigh on current advertising budgets, presenting near-term challenges across the industry. That said, Savio's high repeat revenue rates, rapid programmatic adoption, and ongoing international expansion positions the company well as we approach a traditionally strong fourth quarter in the 2026 midterm election year, where our compound annual growth rate has historically exceeded 60% in election year periods. I will now turn it over to Aziz, who will provide a quick recap.

Thank you, Sajid. Before we get into what is in store ahead, I want to spend a few minutes to expand on the early discussed debt transaction and our whole debt picture. Our recent debt transaction was a replacement of a commercial debt instrument that was coming due. Our hesitancy to do an equity financing deal with the tailwinds we have is exactly why we just swapped out a convertible debt instrument for a non-convertible one. We're not concerned about paying off the debt instrument with revenue generated in our highest revenue quarters of Q4 being assisted by what is anticipated to be one of the most expensive midterm election cycles in U.S. history in 2026. Just to clarify, in the U.S., election dates are set for November 3rd every two years, unlike that in Canada. So we have the predictability of what will happen in the next few months. Next, I want to clarify details on our debt. As Sajid discussed, outside of $1.35 million held by non-insiders, we don't have any really long-term debt. The amount that is classified debt is really a mechanism that allows us to make use of receivables faster. As invoices get paid, so does our line. This type of mechanism allows us to leverage one of the best assets more effectively, which is blue chip customer payables, versus having to keep large reserves on hand and not being able to deploy them for growth. What has been our default rate on invoices from our top customers, or really anyone, the answer is close to zero. That is why this really should not be considered a big debt component. Now, in terms of the road ahead, we are winning and growing in a challenging environment, positioned perfectly as we enter what promises to be a record political cycle. From national elections to high-profile local races, including the California governor's and Los Angeles mayor's race, which, by the way, the last mayor's race four years ago was had a record $100 million spent just in a matter of a few months. And that is scheduled for next year here in Los Angeles. Savio is built for growth. Consistency gives us strength. Innovation gives us momentum. Diversification gives us more reach. And together, they ensured we're ready for the next wave of opportunity. This was both a record second quarter and first half revenues in Savio history. And we're just getting started. On that note, I'm going to hand it back to Martin for any questions.

Martin? Thank you very much. And speakers, are you going to be turning on your video at this point? Yes, we will. Our first analyst questions comes from Gabriel Leong. Gabriel, you are able to speak now.

Great, thanks. Hey, guys, thanks for taking my questions and congrats on the progress. Just curious if you can talk a little bit about the current programmatic pipeline, how you think that's going to shape up over the course of the year and into 26. And I'm also curious whether the growth in programmatic is going to, do you expect it will come at the expense of your managed business?

Welcome Gabe, thank you for the question. The first part of that is, in terms of our programmatic pipeline, we're seeing tremendous opportunity of growth and that dovetails into your second question. And it really is driven by two factors. First of which is, we're not seeing a cannibalization of our managed service business, because of programmatic, what we're seeing is there are pots of money that we did not have access to when we weren't offering programmatic. And so now we have the benefit of both managed and programmatic, hence the fact that you could see that 92% reoccurring revenue model still consistent. The second part of this equation, what's also happening is because of the tariff situations here in the US, of course, globally, advertisers aren't able to plan further ahead. And so it allows them to now turn off and off on very quickly as it relates to, you know, changing tariff environment. that we see coming out of the US. And so that has really facilitated the growth of programmatic. Now, as you probably know, Gabe, 90% of all CTV OTT is transacted programmatically. And so while our managed service business is consistent and we see growth there in certain categories, we do see a huge opportunity with programmatic. And that also dovetails nicely as we grow our creator television channel. because that provides us, once again, unique supply and inventory. Did that answer your question, Gabe?

Yeah, that's super helpful. And for this midterm election cycle, do you anticipate more of a programmatic spend versus, well, you didn't have it before, but do you expect that it will be a contributor to your programmatic growth on the political side this year?

Yes, very much so. In fact, we think we were limited while we had a record political year last year. It did limit us by not having programmatic. And this year we are excited about the new offering programmatic. And we're seeing, quite honestly, a lot of great success. We're seeing advertisers start testing us and saying, just continue to keep those campaigns going and keeping them evergreen. So the consistency of our revenue will start becoming more of a factor with programmatic. Sajan, anything you want to add to that?

I think that was very well captured. I think that, you know, it's worthwhile. pointing out that in political spending, most political spending is done programmatically. And we haven't had a programmatic offering in the past, right? In 2024, all our programmatic sales were through managed services. So now we have a programmatic offering. And to Aziz's point, we definitely expect that to benefit us in the midterm election year and beyond. You know, you have to escape where the puck is going and the puck is going towards programmatic. And so that's why we're investing in it. And we definitely expect to reap the benefits of those investments.

And to that point, next year's election cycle, we're super excited about because not only do we have programmatic, but we have our own channel, the Creator Television Network, which is exactly where these politicians need to be. Younger audiences who can make an impact, younger, diverse audiences who can make an impact on the next cycle.

Gotcha. Maybe that leads to my next question. On the creator TV side, I'm just curious if you have any talking points around whether that's been helping to drive additional growth in your core business or any evidence of that, I guess.

Yeah, it has. And the reality is the first of which is the fact that it's increased our visibility. As you know, we have been, as you know, all too well, we have probably been a tech player, right? Monetizing everyone else's inventory, providing insights and analytics. And now we're in a position where we have our owned and operated inventory that's exclusive to us. What that does is it puts us in a completely different category of business. Not only is it a different category of business, it is one of the hottest growing categories of business, which is the creator driven network business. And so greater content business, which I talked about, is on pace to be a 500 billion dollar industry in a matter of years so it does put us in a in a different place it also and all it also helps us with our data and app science so now going back to your question of you know is there anything specific that we could point to that that you know that from a numbers perspective well at this point what we want to kind of point to is this growth in our viewership and our programming. And what you will hear from us in the coming months is collaboration that is driven by this unique opportunity of program. And it's a very cost-effective approach we're taking. We're partnering up with other companies to collaborate with them on programming, on and collaborating with the creators. And really, it's going to give us a whole new set of selling opportunities, not just in the US, but globally, just in time as our global expansion and footprint is expanding. So we really are setting ourselves up for really great acceleration, more so towards the end of this year and into 26th.

Is it worth highlighting at this point how much your revenues are being influenced by career TV? Or is it a number that you might provide maybe down the road?

Yeah, it's probably something we're going to start talking about more at the beginning of 26, just simply because we do think there's going to be some opportunities for it to be influenced by the at the end of this year. But really where we see it to start making a meaningful impact is in 26. But, you know, in the meantime, as we talked about programmatics making a meaningful impact. um, internationals make you a meaningful impact. And those are the two new products that, you know, we're already in the works while, you know, creator TV now is, is getting that third, uh, third leg going in a big way. So we're, we're super excited. I mean, we got so many things hitting on all gears. It's just, I think as it relates to the loss this quarter, uh, you know, it is, It's not indicative of the full picture, just simply because the investments we're continuing making are setting us up for this acceleration. And we're just we're excited. We're primed. This engine is starting to hit on all gears. And now, you know, as you saw what we did in 24 election cycle, we came out at challenging 23. We hit on all gears in 24. And that was before we had all of the, you know, the tools in our toolbox that we have now. So super, super excited about that. Add there.

I think you captured it well, Aziz. I think that it's just worth reiterating that, you know, Creator TV just launched on Zumo and Fire TV within the last couple of months. Some of these platforms after Q2 ended. And so while they're not showing up in the Q2 numbers, the viewership has exploded on these platforms since their launch. And we definitely expect them to have more of a contribution in Q3 and Q4.

Gotcha. Maybe one last thing for me. The mobile group obviously had great growth this quarter. Just curious if there's any commentary around that. What can we expect to see from that group over the course of the year?

I think it's a function of this need for some of our brands to go into a very performance mindset with the tariff situation and some of the uncertainties that's unfolded because of it. And we do believe that while mobile will continue being a key component, the streaming, the ad-supported streaming business of ours will continue being the key driver. So we don't think there's any kind of shift ahead. And I think, you know, I'll let Saja get into this. But, you know, really, we think this is going to be this is just also a situation where it's, you know, people want to leverage our data science capabilities, our insights, our analytics to drive outcomes on a lower funnel basis. But what we suspect will also happen is branding will be coming back into vogue in a lot of ways. And so that will push the CTV upper funnel movement. Saja, anything you want to add to that?

Yeah, it's just, again, worth reiterating that Creator TV, Programmatic CTV OTT, and Performance Marketing all launched this year. This is their first year of operation. They did not contribute last year. And already, Performance Marketing has contributed to an 88% increase in our Q2 sales in its formative stages. A programmatic CTV OTT is going to contribute seven figures in Q3, and it's going to ramp up very fast afterwards. Creator TV has exploding viewership since being launched on Zumo Play and Fire TV. We are still in the early innings of what we expect to be a very robust growth cycle.

Awesome. I appreciate the feedback and congrats on the progress.

Thank you, Gabe. Appreciate the time.

Our next question is from Thomas Hui.

Hi, Tom. How are you? Sajid, good morning.

So my question is around sort of the uptick in expenses due to those internal investments. I understand you're trying to stand up these new products. We're just wondering if these are ongoing investments or if they're going to trail off anytime soon.

Thanks for your question, Tom. I'm going to hand it over to Sajid. Sajid?

Yeah, I think that whenever you have a new product being launched, you have to expect some sort of upfront investments being made. And that's what we've been doing in Crater TV, Programmatic, CTV, OTT, and our international business. I think our international business is a great example. Last year, we had one seller there who contributed 1.4 million in sales. Now we have four sellers, going to be five very soon. So what's the return on that? we are going to exceed all of 2024 sales in Q3 internationally. So it's already paying dividends. Mobile sales, again, stretched 88% because of our performance marketing product in part. Programmatic CTV OTT is going to make up a greater portion of our sales mix in Q3 and beyond. So to answer your question, Tom, yes, these have required early investments, but we definitely expect that as these become more mature, the OPEX requirements will level off. And we see that happening around Q4 and going into the 2026 election year. And we expect the 2026 election year to be a big one. Again, we were able to turn around for perspective a loss in 2023 into a close to $4 million gain in 2024. Going to 2026, we have a lot more growth pillars set up for us. We expect 2026 to be a very big year for us.

That's well said, Sajan. And I think also, Tom, one of the things to keep in mind is that we had put a strategy, you know, one of the things that Sajan talked about, we came off a really strong election cycle in, you know, in 24. And the thinking was like, okay, great. You know, Kinsabio, can you grow the revenue outside of election cycle? Well, we're doing it, right? We're executing. We did it not simply, we're doing it in a tough environment. And I don't think sometimes we get enough credit for that. We started putting infrastructure in place last year, investments this year, and are executing on those. And we are growing in a turf-infused environment and diversified our business at the same time, going into one of the best election cycles in U.S. history. So we're super excited. And I think the reality is those investments are paying off. Sometimes, sure, you know, if we... If we had it, you know, if everything worked out the way we would have thought it worked out, there wouldn't be this thing called tariffs that showed up out of the White House that then affected some of the automotive components. There wouldn't be tariffs that are affecting some quick service restaurant or retail. And so surely we were affected by that. But despite that, and if the tariffs did not exist, let me just be very clear. you wouldn't see this loss today. I mean, we were very much on our trajectory, on an upward trajectory if it wasn't for the tariff situation. And I think in the broad economy, it's being impacted everywhere. Despite that, we were able to execute and continue. And that was because the diversification that we have and the investments we put in new products. Otherwise, we would be down in a considerable way. And we're not. But I don't think it necessarily shows up in the way that we know it's going to show up later on this year.

Understood. Definitely very strong performance this quarter. I guess my last question would be on sort of the competitive landscape here. I think looking at all the US ad tech companies, they all mentioned CTV as a major growth driver for them. And we also see some increased competition, such as Amazon forming an exclusive partnership with Roku, which is like a big CTV player. I was just wondering, I was curious your thoughts on how the CTV landscape is shaping up and if you're seeing some competition from large players.

it well you know tom i think you saw early on and we showed you our thinking around creator television and this was like probably a year ago when we first started talking about it this is a key differentiation now if you think about our competitors in the space right so we are now not competing with amazon we are on amazon fire right we're not competing with comcast zumo we're on zumo we're going to be on all these other platforms so the way to think about us and then While we have now content, we have our channel on these platforms and we're having conversations with more platforms to distribute Creator TV. We are now not competing with them. We're playing with them and we're enjoying the growth that they're having. We also have the benefit of AppScience playing with them and insights. And now we're talking to them about, you know, how do we use our insights for their platform? So I think the way to approach, the way to think about Sabio is we continue to expand. And now we are a piece of their environment versus us competing in their environment. So that's how we're different from a trade desk. The trade desk is competing with Amazon. There is zero sum game there. With us, there's no zero sum game. We are actually on Amazon. We are on Plex. We are going to be on all these other platforms. And I think that's where we see the opportunity going. So we're super excited. The more competition, the better. The more distribution sources, the better for us. Because not only we have now content, which is the newest addition, we still have the great data and insights that these folks don't have. And so really, we see them as partnerships more than we see them as competitors. Does that answer your question, Tom?

Yeah, sounds good. Thank you for taking my questions.

Sure.

Next questions come from Nicholas Cordolucci.

Hey Sajid, thanks for taking the time and answering my questions. Just a couple here. Firstly, maybe if you guys could talk a bit more about the international approach with the UK office and how that's opening the door to new clients and a more integrated approach.

Yeah. You know, what we learned, you know, and that the way this all came about, I think I got asked by one of the investors, why would you go into the international markets disease when you have a lot of growth opportunity in the U.S.? What would you, you know, we're still a small company. What's the rationale there? Well, the rationale, rationality for that is the fact that what we started seeing is. our brands, some of the biggest brands in the world, started saying to us that this tariff environment was going to, you know, that we saw this three years ago. In the 23 down, the pullback in a total U.S. market, what we saw is international markets were doing better. And we were not diversified in 23. And so our thinking in 23 was like, look, If we are going to now weather storms that are going to head our way, let's start diversifying from a geography perspective. Let's not have all our eggs in one basket in the US basket. And so we started working on this in 23. And so what has happened along the way is we have leapfrogged. some of our competitors now in the international market because we have differentiated analytics. We have our ad serving capabilities that could be anywhere in the world. And we are now connecting those dots and those pipes. And we are really showing up on a lot of new campaigns across the regions, whether it is in the UK, we're doing campaigns in Africa, we're doing campaigns in Asia. We are literally seeing opportunity everywhere. And what our brands are telling us is this is really great for them because as they now shift some dollars as is happening from some of the brands we've talked to, they're shifting dollars out of the U.S. They're European brands. They're not pushing into U.S. They're keeping because of the tariff situation. They're keeping those dollars in Europe. And so we're benefiting from that. So like we are seeing a tremendous level of upside there. And it fits really well with our product set. And we're leapfrogging, leapfrogging our competitors. And it is really, you know, we're super excited about that. Sasha, anything you want to add to that?

And I think that that's exactly right, Aziz. And it's just, you know, we are in the early innings there too. It's only been, you know, 2024 was our first year's revenue out of the UK. 2025, we're going to exceed all last year's sales in Q3 alone. We are set up to win there. And it's, you know, it's a lot of our peers who don't have this kind of international expansion, who are stuck in one or two markets. They are not reaping the benefits that we are in a year that's generally more challenging for the US economy.

And Nicholas, you know, obviously this all and that goes back to the initial question, the question that we've been asked a lot. Well, Aziz, you grew revenue, but then you also grew your expenses. Yes, because we have that much opportunity. So it's like if we couldn't show it in terms of our numbers of growth in Europe or growth of Creator TV or growth of Programmatic, boom. then we should be questioned. But the fact is we are executing at a high level and we're taking market share and we're having fun doing it. So I hope the market understands that we are here to win. We're not here to lay around and just wait for yesterday's cycle. We're continuing to evolve and grow revenue all together.

Yeah, I think that's well said. One of the easiest things that we could have done is just rest in our laurels, you know, kind of bank on expanding even the margins this year. And then next year, the year afterwards, our growth would be subdued. You know, that wasn't what we wanted to do. Right. We are because of the investments we're making now. It's not only setting us up well for 2026, which we're going to profit in a big way from, but beyond that as well.

Got it. OK, thank you for that. That's great. And then just my second question was on profitability. Looking forward to 2026, what can things look like from an EBITDA margin perspective on when the business does hit that inflection point from the political revenue?

Yeah, so I think that in 2024, we saw 8% EBITDA margins. I don't see why we can't match that or not see that in 2026.

And Nicholas, just so you know, Sajan and I have a very good partnership in the sense that I get to think of some growth opportunities in the years we need to expand. And then I have to pay the bank back in the years that we are making the money. So next year is the payback period. And I don't get to like, you know, that's kind of you look at our track record. It's we expand, we invest, we grow, and then we we really capitalize. And next year we will capitalize. And I think that's really I mean, how could we not? We've you know, as I just mentioned earlier on this call, 100 million dollars were spent in the U.S. and just the L.A. city mayor's race. four years ago, which we didn't participate at all because we weren't even in that space. Now we have one of the fastest growing creator television channels. We have deeper analytics. We have a programmatic offering. So we're, you know, that race alone, we're going to play in, but yeah, midterms the senator races the house races you the california governor's race is big so we're beyond giddy we're excited and we're we are making waves and and uh you know people are taking notice of what we're doing so we're super excited awesome all right thanks for the time guys those are my only questions cool

Thank you for those analyst questions. We are now taking questions from the audience. Please type your questions into the Q&A feature and I will read them out. First question here. Can you discuss the 15? Why the 15 percent financing?

Yeah, yeah. So it's a good question. And so we had a few different options. Number one would be just to pay back that loan in its entirety, which was definitely a viable option. But again, we are investing in our future growth. If we took out over a million dollars to pay back that loan, that's a million dollars less to grow our business. And so the next question is as well, maybe you do an equity financing that was also on the table. But, you know, we want to do an equity financing on our own terms, not just do it because we're under the gun for a note expiring. And so it wasn't really appealing for us. I think that, you know, to do an equity financing has to be more than just the payback alone. It has to be to really funnel your future growth and really have to have an articulate growth plan to back that out. And I think that that's why we weren't too keen on doing that all under under the gun of a maturity date. This was a good option in the fact that we were able to bring down our shares by 1.7 million. We were able to pay back this convertible debt, swap it into a short-term fix. And the way our AR line works is that you're able to borrow more from it when you have the collateral for it. And that usually happens later on in the year around Q3 and Q4. when your AR is higher. So we're going to have a few different options at the end of the year. We can pay it back through our profitability. You know, Q3, Q4 in combination are usually profitable historically. Or the other option would be to pay back through our line at a much reduced interest rate. And so, you know, this was the best option which incurred, you know, in the grand scheme, very modest dilution.

As Saj has mentioned, we're very aligned with investors in the sense that we don't want dilution, right? We are not one of those companies that just dilutes down and raises and raises for no reason. We raise and we think about what is behind the raise and what's the impact and how does that impact our own ownership and that of our, we're very aligned with that of our investors. And so dilution to us is something that we will fight at every turn unless we really need to really, and we did get approached about doing dilution through a capital raise and an equity raise. And we said, look, for the time being, We need to show, as we're seeing the success of our programmatic, as we're seeing the success of our creator television network, we're seeing the success of international growth. We could show these tangible differences and I think the market will appreciate it. And I do believe that the proof's in the pudding. And as we have, as Sajid talked about, you know, look at the 23 and 24 trajectories. We invested in 23, we put the resources in place and we came back and had the best performance You know, numbers both top line and bottom line in 24. That's not going to be any different in 26, except the numbers are going to be even bigger. And I think that's really what people, you know, what we really want people to understand is that we have to invest. We're still a small company that needs to invest in growth. And, you know, how we do it is very critical because we don't want to dilute shareholders on the way up. That's what we don't.

Yeah. And the coupon on that 15%, you know, the convertible debt that we retire with a 14%. So essentially the same, and we're growing our business north of 20%. So, you know, it is a good use of capital. We feel to retire to keep this debt going and investing in our business.

Thank you. The following question is, is there a share buyback plan given the current share price?

Yeah, I think that we obviously feel that our share price is depressed, but we also have to balance that with our competing priorities being the growth that we're seeing in our business, right? When you have a quarter where performance marketing contributed to 88% of your mobile sales growth, when you're reaching a Q3 where international is posed to do more than all 2024 sales in one quarter alone, The question becomes, where is the best bang for your buck in allocating resources? While we feel our stock price is depressed, our bias for capital will always be where we're going to get the highest ROI. And we are seeing a lot of growth pillars right now in front of us.

I couldn't agree more, Sajan. Look, next year will present us an opportunity to do buybacks. But this year goes back to what we were kind of saying is it's investment and putting in and setting us up for the rest of this year and really celebration of 2016. I mean, 2026, sorry, 2016. Flashing me back. 2026 is really going to be super exciting.

Thank you. Several questions here on some guidance. Are you providing any guidance for this year?

Yeah, I think at this point, just given to the choppy nature of the macroeconomic backdrop, it would be a bit irresponsible for us to put our line in the sand and say, this is where it's gonna be. I think that we're expecting further top line growth in our core business. I think that's what we've seen in Q1 and Q2, and we expect our core business to continue growing. Profitability, we always have an aim of being profitable for a year. This is a challenging year, but I think it's what we are confident in is that the moves we're making today are gonna pay off in a big way next year and thereafter. We're gonna see an expansion be the margins next year we're going to see uh even stronger top line growth across our core business and also growth in our political apparatus too and so um the movies we're making today are going to pay off in a big way anything out of that disease yeah i think look as you know we're shifting this business model in a bigger way and as programmatic we talk about you know the the industry is shifting from a managed service business to programmatic which we're taking advantage of but

The other part that you should really think about is the fact that, you know, as we've talked about, our margins roughly have been around 60 percent on the core business. When we do our own channel and when as our channel continues to grow, those margins have an opportunity to go up just simply because our profit margin on our own channel is much higher. And so that it presents a new opportunity in our ability to monetize these things. globally, which is now the position we're in, becomes even more important. So we're set up, we're the most complete end-to-end tech stack in ad-supported streaming. One of the most complete between our ad server, our analytics, and now you add a channel that we monetize ourselves. That is the Nirvana situation. So we just need to like we have this the three trifecta here that is now just starting to click. And if we just continue doing what we need to do, which is our goal the whole time was build the most complete ecosystem we can build. And now we're on the cusp of it with the creator television channel. That's the last leg of the stool. And when that takes off, as it's already doing, that allows us to change the whole dynamics of our company. I mean, this is that watershed moment to change, you know, from just simply being an ad tech player to being an actual network. That's what we're headed to. And that provides some really tangible benefits to investors in a big way.

Yeah, and I'd just like to add one thing to that is that we all get the want for short-term profitability. But I will say that if you were to jump off our ship back in mid-2023 and sell during a period where we weren't expanding maybe the margins because we were investing in our business, that would have been a losing trade. We tripled our stock price in 2024 as the political year unfolded and our sales ramped up. And so... I would just kind of caution everyone to kind of learn from the past. I think that we're expecting a very big year ahead of us. We're making the moves right now to reap the benefits of that. And we're already seeing the early traction. See the programmatic sales ramp up. See the international sales ramp up. See QuerTV viewership expand.

Thank you. Can you say what quarter you expect to be cash flow positive?

Yeah, I think that, you know, historically, we're always cash flow positive in Q4. I think that we don't see any reason why that won't be the same this year, you know, as far as in an individual quarter basis. You know, I think for the year, I think if you look back in the political year 2024, we were cash flow positive for the year and we are going to be cash flow positive again in 2026. You know, this is obviously has been a year of investment in the first half of the year. Is there a possibility of being cashflow positive for this year? There's a possibility, but there's also a very challenging economic backdrop as we invest. That said, we definitely expect 2026 to be cashflow positive.

Well, and I think it's challenging, right? One little post on X can change the dynamics of everyone's business. And so if, you know, automakers and, you know, major companies and are, you know, all over the globe can't figure out where they're going to be, it's really hard for us to be, you know, predicting that as well. It's just the environment is too fluid. And we're certainly, we're fortunate. We have a consistency of business that now we're growing despite the environment, but But the tariff, you know, corrosion is real. And I think there's so much uncertainty. But, you know, the benefit we have as we keep talking about is we've diversified our business geographically, product wise, and we're going into an election cycle. So, yeah, sure. Look, you know, we do expect Q4 to be much stronger and we're seeing good signs of that. But really, we're also excited about 2026.

Thank you. You said before that being partnership with big brands and you saw opportunities in the international market, what market regions are really growing fast?

We don't want to get into too much detail just simply because we have a lot of competitors that also track us. But we will say this, that we're seeing a lot of opportunity in Europe, just specifically the tariff situation that Europe is dealing with is really having them think about internal growth relative to US growth. And so that across all of Europe, we're seeing great momentum. We haven't really touched on Asia a whole lot just yet, It's been Middle East and Europe that really have been driving our growth. And we see, you know, a lot of untapped opportunity. I think Asia is, you know, we've had a fully owned subsidiary in India since 2016. And as you can imagine, we are positioned well to enter that market. And we have not wanted to enter that market before we had something tangible. And our creator television channel is tangible. And so, you know, it's going to provide us an opportunity to grow there. So. It is Europe and Middle East for the time being, but we do see huge upside in Asia and Africa.

Thank you. How do you ensure competitive advantage internationally without the household graph that you have in the U.S.?

It's a great question. We are doing it. We are actually expanding, working on part of investments and what we're working on that are going to are being deployed now is the expansion of our household graph into Europe. So we are working on that. We've put in putting resources there. And so it really allows us to start expanding into that market and have a key differentiation. Sorry, today what is happening is the key differentiation is also happening through some creative units, some third-party data sets we're able to really leverage. But we do believe that our household graph will be in existence in Europe sometime next year. But that's part of the investment thesis of this year. We've got to invest in some of these things and these demands that we're seeing, these opportunities that we're seeing that... don't necessarily come to fruition, pay off the day you make that investment, but they do pay off in a few months from now. So we're seeing it.

Thank you. Can you please share what the AR line financing cost is?

Yeah, yeah. So it's about prime plus 2.15%. So a little over 9% is the financing cost of the line.

All right. Are you considering any strategic alternatives considering how the share price has performed?

Strategic alternatives in terms of mergers or acquisitions?

I believe so. There's not clarification. There is just strategic alternatives.

You know, look, it behooves us to always keep our eyes open and opportunities, explore every opportunity there is out there. And we see, you know, we have had conversations in the past and we're always open to different ideas. I will say this, that we are very confident about the trajectory ahead, going into one of the most hotly contested midterm election cycles in history, not to mention the LA city mayor's race and governor's race of California. So we're feeling pretty good about where things are headed. In the short run, you know, while the numbers don't show it, the demonstration of our execution on a product side does. And so, you know, it's going to take, you know, we're open to all ideas, but really we're feeling pretty good about our strategy overall and how we want to get there. Did I change anything after that? No, we did that. That's well said.

Okay. Yeah. Do you have any sort of timing or idea as to when to enter the India market for advertising and how those operations could grow?

Yeah, so, you know, look, we have some preliminary thoughts. We don't have any specifics. We're actually, we're our teams. That's another project our teams are working on. We believe the entry into the India market will be through our own app. You know, keep in mind, we are app science. We own app science. We understand more about the app ecosystem than a lot of folks do. We understand we have a performance product that can help us deliver downloads. We have all these capabilities, and now we have creator television. And the creator economy in India, a 1.2 billion population economy and growing, I think the number might be even higher since the last 10 seconds ago, it is a huge opportunity. And what we see in India is not simply going into India from an advertising tech perspective, but going into India with our own app. with our own creator television app. And there is excitement there. We've already had some initial, you know, assessments. That's part of the investment roadmap. And I think, you know, when you think about Sabia, you think about just so much untapped opportunity and so many, and that's, That's our challenge. We are not one trick pony. And our challenge is the fact that we are so diversified, both from a product and now from a geography perspective that like the opportunity is limitless. And I think we're super excited about it. So, you know, to answer the question is. Probably, you know, this is part of our investment this year that is going to take place in next year sometime in India is what we would like to have happen. We're just we're really busy this year with some of the, you know, a planning on that, planning on their household graph for Europe, putting some investments there are, you know, obviously our sales expansion in the U.S., our sales expansion in Europe. So there's a lot of various things that we're working on and really busy with, but India is on a roadmap for next year. And we're pretty excited about the possibility that brings.

There are no further questions at this time. Do you have any final comments to make? Otherwise, this concludes today's conference call. Thank you very much.

Thank you.