Quotemedia Inc

Good day, everyone, and welcome to today's Q3 results conference call. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question and answer session. You may register to ask a question at any time by pressing the star and 1 on your telephone keypad. Please note, this call is being recorded, and I will be standing by if you should need any assistance. It is now my pleasure to turn the conference over to Dave Schwarm. Please go ahead, sir.

Thank you. Welcome, everybody, and thank you for joining us. I have a brief safe harbor, and we'll get started. Except for historical information contained herein, the statements in this conference call include forward-looking statements that are made pursuant to the safe harbor provisions in the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties that may cause our actual results in future periods to differ materially from forecasted results. And now we're happy to go over our 2024 Q3 results. Our revenue results were pretty much the same as last quarter. We achieved just under $4.7 million in revenue for the quarter. We did, however, increase our deferred revenue, totaling $2.3 million at the end of the quarter. The majority of our deferred revenue relates to setup and development work already completed. This year has been a struggle for a few of our clients, and unfortunately, if they don't succeed, then we are affected. However, hopefully, this is not a recurring trend, as this year there have been a few clients that have decreased their spend, and it has hit us a bit hard. We have closed other contracts to get back to a flat line, but it has certainly been unfortunate. We do have a lot of new clients in the pipeline, and we're getting closer to getting some of these larger deals signed. Even though we had a flat quarter, everything is going well, and we do feel we are going to have a strong finish to the year, and 2025 is looking to be very exciting. I'll now pass the mic to Keith Randall so he can take us through the numbers for the quarter, and then we can answer questions.

Thank you, Dave, and welcome, everyone. I'll start with the income statement. Note that all comparisons are on a year-over-year basis unless otherwise noted. Overall, we had a 1% decrease in total revenue for the quarter. Breaking down our revenue, interactive content revenue, which is web display content, decreased 3% from the comparative quarter. We had some customers who reduced their spending with quote media, offsetting the revenue from new customers added during the quarter. Total quote stream revenue was flat, with corporate quote stream revenue increasing 1% and individual quote stream revenue decreasing 1%. Our cost of revenue consists of fixed and variable stock exchange fees and other data costs and amortization of capitalized development costs. Our cost of revenue increased 10% for the quarter. This was mainly due to increased amortization expense associated with the capitalized costs related to improving infrastructure new product development, data collection, and the expansion of our global market coverage. Our gross margin percentage was 46%, a 6% decrease, which was primarily due to the increase in our cost of revenue from the comparative quarter. Our total operating expenses increased 10% for the quarter. Most of the increase relates to additional personnel hired to achieve our expansion objectives including improvements made to our infrastructure, security, and business continuity management. Bills and marketing expenses increased 23% due to increased personnel costs and an increase in stock-based compensation expense. We incurred negative $57,000 in stock-based compensation expense in the comparative quarter related to the fair value adjustment of our preferred stock warrant liabilities. G&A expenses increased 2%, primarily due to the increase in bad debt expense related to the $175,000 increase to our allowance for bad debts, resulting from a significant client discontinuing our services due to their financial struggles. Software development expenses increased 6%, primarily due to additional personnel hired since the comparative quarter. Our net loss for the quarter was $441,000 compared to net income of $126,000 in the comparative quarter. The decrease in net income was mainly due to increased personnel costs as well as the increase in our bed debt allowance. Our adjusted EBITDA was $367,000 compared to $720,000 in the comparative quarter, a decrease of $353,000. Please refer to the reconciliation included in our press release for the calculation of adjusted EBITDA. Turning now to our balance sheet and cash flow statement, our cash totaled $291,000 at quarter end, which was a $51,000 decrease from our year-end cash balance of $342,000. Our deferred revenue totaled $2.3 million at quarter end, which was a $500,000 increase from year-end. The future costs associated with realizing that revenue is minimal as the majority of the deferred revenue relates to setup and development work already completed. Those setup and development fees have been deferred and will be recognized in future quarters over the service contract to which they relate. Our year-to-date net cash flow from operations was 2.6 million, while net cash used in investing activities was also 2.6 million. primarily due to spending on infrastructure and product development. Going forward, we're expecting a return to positive revenue growth in fiscal 2025 based on pending sales in the pipeline. We also intend to reduce our development spending as a percentage of revenue as some of our major development projects near completion. As pending sales deals close and our revenue growth improves, Combined with cost control measures, we expect our bottom line to improve in 2025. Thank you, and I'll now pass it back to Dave.