Acast AB (publ)

Hello and welcome to ACOS Earnings Call for the Q2 2026 Interim Report. Joining us today are our CEO Greg Glenday from New York and CFO Anders Haag from Stockholm. You're welcome to submit questions throughout the presentation using the form next to the stream and we will raise the questions during the Q&A held after the presentation. I would now like to start by handing over to our CEO Greg Glenday. Greg, the floor is yours.

Thank you, Lizzie. Welcome, and thanks for joining us today. In my section, I'll cover off our high-level performance and momentum, and then Anders will take you through the numbers. ACAST is the world's largest independent pure play podcast company. We build the infrastructure that allows creators to monetize and advertisers to reach audiences through podcasts across audio, video, and beyond. We continue to be very excited about the momentum our strategic approach is generating. We've been working on this for more than a decade, and it's very rewarding to see this payoff. We strive to be the best place for creators. Great creators bring more valuable audiences. Valuable audiences attract advertising revenue. Advertiser revenue attracts and motivates creators and so on. So we have created this infrastructure flywheel for podcasting. ACAST is the engine room at the center of all of this. Talented people around the world and industry-leading innovation, technology and data. We want to create an unencumbered relationship between creators, their audiences and advertisers. Creator choice, open ecosystem, no editorial point of view, brand safety. Those are the principles underlying everything we do. Thank you. Thank you. We're excited to be actively working with them on establishing industry standards for HLS measurement, podcast audience consumption that may be either audio or video, or a hybrid of the two. And from this quarter, we are moving to report both listens and views. Today, our reported audience numbers reflect RSS audio and HLS consumption. We expect to expand this to include YouTube by our Q3 report. So, when I say ACAST is the best place for creators, I mean everything from premium publishers like TED, Le Monde, Perfect Day, or Slate, to huge independent shows, all the way down to a large number of niche shows with passionate, smaller followings. There are three reasons that creators come to ACAST and stay. First, we are the best place to monetize. We've now paid out $690 million to our creators since launch. Second, full independence. Creators keep both creative and commercial control over how the show sounds and looks, where it's distributed and how it's monetized. Thank you. We'll see you next time. Thank you. Thank you. Thank you. Thank you. Thank you. Our sales motions cover that full spectrum. Omni-channel brand, programmatic, and self-service. With precise, data-driven targeting, ACAST is the only company that does all of this, and we do it well. That's exactly why we're also great for creators. You don't have to be a household name to earn here. A smaller niche show can be aggregated with others and sold to an advertiser. Every advertiser solution feeds creator monetization, so the flywheel turns even faster. Underpinning this approach is robust proprietary data, especially through our subsidiary company, Podchaser. Over the past year, our teams have been working hard to develop ACAST intelligence tools on top of this data. Thank you. In addition to that, you can imagine a long menu of valuable use cases. Some examples our teams are already using include brand competitive snapshots, audience analysis, and narrative sentiment with so much more on the roadmap. . . . . . . . . Take the 2026 World Cup. Podcast attention ran at roughly three times search interest across the two weeks leading up to the event, surging closer to kickoff. And that's exactly where the opportunity lies for brands. If you're trying to break through during the event itself, it's incredibly crowded and incredibly expensive. But through podcasting, you can start that narrative early and be part of the conversation organically. This is podcasting, and it's what we call narrative influence. ACAST is the world's largest pure play podcast company. This is what our global scale and pure focus actually look like. A category of one. Specialists, not generalists. Podcasting isn't an add-on for us. It's the entire business. We built ACAST to be global, but we prioritize local expertise and execution. We operate in 32 markets, and we have people on the ground in cities and offices around the world. This illustrative example represents the competitors our local MDs compete with on a daily basis. Of the companies we come up against, only a handful, four or so out of the 60 on this chart, operate in more than two markets. And over time, our business model has grown further and further from Spotify, which has made us stronger partners. The benefit for creators is that one relationship equals a worldwide audience and worldwide revenue. Podcasting does not need a corporate suit to green-light a show in every country. It's a meritocracy. A show from the UK can be big in Australia or the US if the audience says so. For example, we have a show in the United States whose second largest market is Ireland. We're able to monetize that audience effectively there on day one. The benefit for advertisers is a single point of entry to a fragmented global market for both individual brands and big global advertising holding companies. All that's to say we are very confident in our position for the next phase of podcasting's growth. Our advantages took years to develop. Global scale with local execution, platform agnostic distribution, creator choice and control, full-spectrum sales motions, self-service to blue-chip omnichannel deals, proprietary data and end-to-end tech, trust earned across the industry. Network effects that strengthen with every creator we add. These aren't separate USPs. They reinforce each other. That's what makes us hard to replicate. Our product roadmap and approach is really simple, but it's very hard for anyone else to do. We simply listen to our constituents, the creators, their audiences and advertisers. Their desires, their frustrations and their ideas become our roadmap, and that's what we build. We're obsessed with building and acquiring the tools needed to remove friction from this process and make that flywheel spin even faster. This will throw off more revenue to everyone involved. So this approach is exactly what's driving the results we will now take you through. Let me give you the headline numbers for the quarter. Net sales were up 28% with 29% organic growth. And that's on top of a similarly strong first quarter. So this isn't a one-off. Thank you. Zooming out to the first half of the year, the picture is just as strong. Net sales were up 24% with 30% organic growth. But the real story is profitability. Adjusted EBITDA grew by nearly 600% year over year, taking EBITDA margin to 6% and our EBIT margin to 3%. That's the clearest proof that our strategy of scaling revenue ahead of costs is working. So if I look at the key events for the quarter, in Q2, we expanded our video work with Apple Podcasts, launching the first ever video advertiser campaigns on the platform with blue chip brands like State Farm and T-Mobile. This is an early vote of confidence in this new advertising format and the start of a broader wave of advertisers coming to the format. Thank you. Thank you. Thank you. has joined ACAST under a multi-year partnership, bringing household names to our U.S. talent network. And we're also delighted to welcome viral hit show The Comment Section with Drew Afualo. These signings reflect ongoing success in attracting premium publishers and talent with highly engaging multi-channel audiences. Finally, two high-profile award wins this quarter. Divine Intervention from ACAST Creative Studios won a 2026 Peabody Award, one of the highest honors in broadcast storytelling. ACAST Creative Studios is the team formerly known as Wonder Media Network, which was acquired at the end of 2024. And ACAST creator Pablo Torre Finds Out won the Pulitzer Prize for Audio Reporting, a true mark of quality. a Peabody and a Pulitzer in the same quarter, proof of what both podcasting and our creator-centric model can produce. I'll now hand it over to Anders for a financial deep dive. Thank you. Anders, please take it away.

Thank you, Greg, and good afternoon, everyone. Let me walk you through the key financial metrics for quarter two, 2026. And we have now updated our audience metrics where reported listens and views and average revenue per listen or view now include all IAB valid listens plus HLS listens and views. We are working closely with the IAB as HLS measurement continues to evolve. Our new metric listens and views grew 2% year over year. As always, our focus isn't on volume alone, but on the quality and value of each listen and view. Our updated metric, average revenue per listener view, reached 0.69 SEK in Q2, a record high and 26% growth year-over-year. Net sales reached 776 million SEK in Q2, up 28% year-over-year and our highest ever quarterly revenue. organic growth adjusted for FX and M&A was 29%, broadly in line with the 30% organic growth we delivered in Q1. That extends a run to six consecutive quarters above 25% organic growth, underlining the consistency of underlying demand. The gap between reported and organic growth narrowed versus Q1, as we saw a much smaller FX headwind in Q2. Gross margin came in at 39%, delivering a gross profit increase of 24% to 305 million SEK. The slight year-over-year softening in margin continues to reflect country and product mix, as North America, which carries a somewhat lower margin while it scales, becomes a larger share of the group. Looking at our segments we saw double digit growth across all three regions in the quarter again. Europe grew 25% with 26% organic growth and contribution margin improved slightly to 25%. North America continues to show strong growth, up 34% reported and 37% organically. And we saw meaningful margin expansion there too, with contribution margin reaching 13% up from 10% a year ago. In absolute terms, Europe and North America contributed almost identically to group growth this quarter, 79 million SEC and 81 million SEC respectively. other markets grew 17% with 13% organic growth and with contribution margin broadly stable at 11%. And overall, this shows strong momentum across all regions alongside continued margin discipline as we scale the cost base. At group level, adjusted EBIT came in at 32 million SEK, a 4% margin. And this compares to minus 7 million SEC and a minus 1% margin in Q2 2025. An improvement of 5 percentage points or 39 million SEC in absolute terms. And this builds directly on the milestone we shared last quarter. Our first ever profitable Q1. And confirms that our operating model continues to scale. On a last 12 month basis, our adjusted EBIT margin now stands at 3%, up from minus 1% a year ago, continuing the steady upward trajectory we've been building throughout the year. Operating cash flow for Q2 was 50 million SEK, an improvement of 103 million SEK year over year. This reflects our return to profitability, EBIT of 32 million SEK this quarter compared to minus 66 million SEK a year ago when results included 59 million SEK of large non-recurring costs. On a last 12-month basis, operating cash flow improved to 176 million SEK, reflecting steadily strengthening cash generation over the past several quarters. And we close the quarter with a robust cash position of 630 million SEK, giving us the financial flexibility to continue investing in our growth strategy. And with that, I'll hand back to you, Greg, for closing remarks.

Thank you. Thank you, Anders. Q2 was exactly what we set out to do. First, record growth across the board, 776 million second net sales, our highest quarterly revenue ever, with double-digit growth in every region. Second, we're delivering on monetization with ARPLV, including HLS video, up 26%. And new partnerships with top-tier publishers and talent, as well as awards, continuing to expand our high-value content reach, including the Washington Post, the Lonely Island with Seth Meyers podcast, and the comment section. Third, that growth is translating into real scale. H1 EBITDA increased to 87 million SEC and EBIT to 36 million SEC, driven by strong revenue growth alongside discipline cost scaling. And fourth, as the world's largest pure play podcast company, we remain uniquely positioned to lead the market shift toward omnichannel. 360 degree monetization for creators, organic growth continues to run ahead of our long-term target, while margin expansion keeps us firmly on track towards our 2028 EBIT goal. driven in large part by continued market share gains in the U.S., our largest and fastest growing region.

Thank you, Greg and Anders. We will now start the live Q&A. Please use the message box below, and we will put the questions to Greg and Anders. So, first few questions from Andreas at Carnegie DNB. Could you explain the sequential trends in the other revenue growth drivers you have, price, ad load, and sell-through rates? You have spoken before that all, including listens, will contribute to growth ahead, and this is the way we should see it also for H2.

Yes, thank you, Andreas. As you know, we don't disclose CPM or ad load or sell-through rates on a quarterly basis, but the primary levers behind what we're calling average revenue per listen and view, including the HLS views, is sell-through expansion, omnichannel growth, which includes video in the mix with higher CPMs, and then Mostly, I can attribute it to more upstream engagement with bigger brand advertisers, so pulling more demand into podcasting itself. So these are really broad, high-value advertisers that are, as I've said, not necessarily specifically buying the high sell-through shows, but buying more vertical inventory into the long tail.

Another question from Andreas. You talk of conviction to increase market share further in North America. Any specific and concrete orders or projects you have taken that builds this confidence?

Yes, we're really excited. North America grew 37% organic in Q2, which we believe obviously is taking market share from some of our publicly disclosed competitors. So the way we're doing that is, again, we've been very consistent with upstream relationships with large advertisers. really being in service to their objections. They all know that people are spending a ton of time with podcasting, so there's a real desire to participate in those conversations with our creators. So when you have a willing participant on the customer side, we're really excited about solving those problems, making it easier to buy podcasting for big blue-chip brands that are a little bit more demanding and have a slightly higher rigor for who they partner with.

The growth in North America, can you explain a bit more where it comes from? Is it from certain advertiser segments such as retail, finance, telecom, etc.? And is it broad-based across the U.S., or are you stronger in certain states?

Yes. At this point, we're not disclosing regions and states and things like that with sort of where the growth is. I can tell you the big national brands are accelerating. But also on the smaller side, we've been using technology for smaller agencies, maybe smaller cities that want to participate in podcasting. Our self-serve platform, as we continue to evolve the capabilities in self-serve, we've been able to accelerate the small advertisers and the SMBs along with the large blue chip brands. So kind of attacking the market from both sides has been really exciting. So both are leading to growth for ACAST.

And how should we see the cost level going forward? It has increased by 8%, but partly this is related to share-based compensation. So just curious if you expect this run rate to go on or if it will be less growth ahead, assuming the share price is flat, which is a bit of a boring assumption.

Yeah, thanks for that question, Andreas, and good afternoon. I mean, part of that OPEX growth reflects the increased social security contributions tied to the incentive program given by the share price rising sharply during the quarter, which is more of a mechanical link and not the change in the underlying cost strategy. and we will continue investing in sales and product capacity, but at a pace materially slower than revenue growth, and that frame is unchanged going forward. And we don't guide to specific OPEX growth rates for future quarters, as you know, but if you look back, I mean, at quarter one, OPEX growth was 2%, and in Q2, it was 8%, so year-to-date, that's 6%. And the biggest swing between the two quarters is the social cost on the LTI program. You have increased FTEs during the quarter.

Fair to assume this is mainly within sales and marketing?

Yeah, I can take that. We don't disclose. I think it's 15 or so full-time heads that we've added net, and we don't disclose where they are, but I can tell you, as I've said, we're in service to our constituents, the creators, the advertisers, so You know, it's technology, sales and service to the growth.

And final one from Andreas, which is a bit technical, but how should we see taxes going forward? You start to make profits, but you should have some fairly large loss carry forwards, especially keen to understand how we should look at booked versus paid taxes.

Yeah, thanks, Andreas. So, as you say, once we start turning a full year profit before tax, there will be a higher tax expense in the income statement than before, but it will not have any cash flow effect as long as we have these losses carry forward to utilize. And then again, in the period when we do capitalize these loss carry forwards that are not yet capitalized, it will have a positive impact in the income statement, but then not the cash flow impact. So hope that answers your question Andreas.

Now some questions from Martin at SB1 Markets. 180 plus shows now video enabled on Apple. How do CPMs and sell through rates compare with audio today?

I can take that one. We don't disclose our CPMs, as I've said, but video CPMs, as everyone knows, are higher. But what's interesting about what we're attempting to do, this is really a new mode. We believe that podcast creators don't have to pick. We're trying to give optionality to both the creator and the audience. So the fact that a show can be video or audio, depending on what that specific consumer is doing, we think that's really exciting. That's sort of a new thing for advertisers. So Those blended CPMs will be higher than audio only, so we're excited about that. Video alone is right now still a small percentage of the podcast industry from a revenue standpoint and a small percentage of our revenue. So we think we're leading the industry, we're leading the way in this sort of multifunctionality, but it's a little too early to report on pricing pressure, but of course video is going to be higher.

And CPM prices, the overall ad market, how have they developed throughout the quarter?

Yeah. Video and omnichannel campaigns have a much higher CPM. That's really what's driving our average CPMs up is that we are including more high CPM packages around these large omnichannel campaigns. So instead of just selling impressions, we've spent a lot of time in the market this quarter. ACAS had a presence in Cannes and a lot of different industry events. And I can tell you that Nobody's talking about CPMs. Really, brands are really truly thinking about attention and outcomes and much more tangible results, which podcasting has proven over the years that we can do. So I'm pretty excited about where the puck is going in the marketplace and the fact that podcasting is already there, works really well, delivers outcomes, and can deliver high measurable attention.

And Europe seems to accelerate in terms of growth. Any commentary on drivers and outlook?

If I start on that one, I mean, the positive thing is that all markets in Europe are contributing. And, you know, what Greg mentioned before, our success in working at high levels with the agency, holding companies and clients as a general benefit for all markets. And we are covering global decision makers who can impact budgets across ACOS region. I think those are a couple of explanations. Then I think also in some markets we had a bit of a softer Q2 last year, which also helps explain some of the strong performance due to Europe in this year.

And a question from Sam. Can you elaborate on what particularly you see have been driving the increase in ARPL during the quarter and if we should assume similar levels going forward?

Yes. You know, I think we've been pretty consistent the last few quarters saying that, you know, Of course, sell-through rate's important, but getting more efficient and being able to sell deeper into our long slate of shows, I think, is what's going to continue to help grow that. So getting better at selling what we already have, I think, is really important. And I think if we can push demand further and further into our network, the better off we'll be. So we have a long way to go to get more and more efficient. So I think we have more wood to chop on that. So I'm excited about the potential upside. You know, we're not in any way, shape, or form. Podcasting is really unique. The inventory is dynamic. The shows can be created, you know, very quickly. So we're excited about just getting more efficient with how we sell our inventory.

And a few questions from Thierry Danielson. Listens grew only 2% while RPL and V rose 26%. Is this strategy to keep monetizing the existing pool or is M&A back on the table to drive volume growth next?

Yeah, well, that's basically the same question with the little M&A tag on there. But yeah, we're opportunistic. I think, you know, whether it's, if it's easier to build it, we'll build it, borrow it, partner or buy it. So again, that's our strategy is figuring out what the industry needs to help us remove friction and we'll go do it in the most efficient means possible.

And are the new partnerships, so Washington Post, Lonely Island, Drew Afualo, Are they content licensing deals, or do they involve some form of exclusivity or ownership stake, and should we expect more outright acquisitions during H2?

Yes, I would say these are exclusive deals where they're all specific to those shows, and Washington Post, these are new shows that we're launching together, so they're a little bit different. But these are exclusive deals. They are coming to the ACAST network for us to distribute and monetize those shows exclusively, and that's what we do. So They aren't IP or licensing deals. They're coming to us to host. One of the things, our position into the creator economy is that ACAST is the best place for independent creators. We don't have an editorial point of view. We don't have an algorithm that changes your content or rewards certain things. It's your relationship as a creator with your audience. We facilitate that and monetize it for you. So I think having that clear story makes it a very attractive place where creators, people like Seth Meyers that have a point of view that don't necessarily need some editorial help. Same thing with the Washington Post. We're the perfect place for people that want to have a direct relationship with their audience.

And a question from Peter Drogarsky. We saw limited CBIT margin improvement in North America versus Q1 2026, even if growth continued strongly. What factors limited the leverage? And on the other side, what helped Europe to its strong margins?

Yes, thanks, Peter, and good afternoon. Yeah, you're right. But of course, if we compare Q2 this year versus Q2 last year, there is still significant improvement. But as you point out, there's a gap to Europe, and I think that reflects North America being a younger, less penetrated market, plus the continued local sales investment needed to win the larger managed service deals in the US. Growth IN NORTH AMERICA IS ALSO COMING FROM A DIFFERENT PRODUCT MIX VERSUS EUROPE WHICH IS ALSO AFFECTING THE GROSS MARGINS AND THEN IF WE LOOK AT EUROPE SPECIFICALLY THERE THE INCREASE IS PRIMARILY DRIVEN BY PRODUCT MIX VERSUS LAST QUARTER GREAT THANK YOU I THINK THAT CONCLUDES THE Q&A

So thank you to everyone who has listened in or watched. The next upcoming quarterly report is our Q3 report, which will be released on October the 28th. You're of course welcome to join us for that presentation. And in the meantime, you can follow us on investors.acast.com to sign up for press releases, news and financial reports, our ACAST newsroom, or of course, listen or watch our results as a podcast. Thank you very much and goodbye.