Sabio Holdings Inc.

Good morning, everyone, and welcome to Savio Holdings Q1 2026 earnings call. The financial statements and management discussion and analysis are available on CDAR+. Today is Tuesday, May the 26th, 2026. Joining us are Savio's founder and chief executive officer, Aziz Ramatullah, and chief financial officer, Sajid Premji. After management's remarks, we will open the call for questions. Analysts may raise your hands, your virtual hands, and investors may submit questions in the question and answer window. Before we begin, please note that today's remarks may contain forward-looking information. These statements involve known and unknown risks and uncertainties. Please refer to the filings on CDR Plus for more information. All figures are stated in U.S. dollars unless noted otherwise. With that, I will turn it over to Aziz.

Thank you, Martin. Good morning, everyone. While we have executed well on our overall objectives by growing our business at 26% higher since going public, including average growth of 24% in non-election years and 61% in election years, all while achieving adjusted EBITDA profitability in four of the last six years, we've been equally obsessed with building a more diversified, resilient company that is not dependent on one product geography or category of business. The investments we've made along the way in our unified tech stack with our own DSP analytics and streaming channel, are helping us deliver on that objective. In Q1, a diversification strategy that started to see traction at the end of 2025 has started to accelerate in 2026, and the timing could not be better. Across the industry, managed service business continues to face pressures, as advertisers increasingly shift towards more agile programmatic approaches. This is especially relevant during periods of uncertainty driven by tariffs, inflation, and geopolitical instability, where advertisers require greater flexibility and ability to quickly adapt strategy in real time, precisely what programmatic enables. At the same time, Tariff-related volatility in the U.S. has benefited international advertising markets, with the global brands we work with increasingly leaning into regions where greater stability and less exposure to disruptions is enviable. The result is more diversified revenue composition in company history, while also positioning us for meaningful advocacy and political spend beginning this summer. We've evolved from a business that was 90% U.S.-managed revenue to a business where 62% revenue now comes from programmatic and international, as we saw in Q1. These opportunities are highly scalable and provide long runway for growth. Importantly, these two vectors helped us grow top-line revenue core by 6%, despite continued challenges in major categories, including auto-related tariff disruptions and consumer spending pressure tied to inflation. Our strategy is also resonating with clients. 77% of our new programmatic clients powered by AppScience in Q4 returned in Q1, and 36% increased spend quarter over quarter. In addition, 95% of new international customers renewed, further enforcing the durability of this strategy. We're excited about the year ahead, and we will speak more about that in detail. But first, I'm going to hand it over to Sajid to get into the numbers. Sajid?

Thank you, Aziz. Q1 had some headwinds that impacted the top line, but the underlying business tells a very different story. The investments Fabio made in 2025 are clearly paying off. Consolidated gross revenues declined 10% overall, driven by two temporary factors. First, a $1.4 million shift in political and advocacy spending, which in election years tends to be concentrated in the second half. Second, a temporary advertiser pullback in March tied to the Middle East conflict. Despite those headwinds, 85% of our consolidated Q1 revenues came from returning customers, even in our newest and fastest-growing areas. The sales decline was largely offset by strong growth in our newest international and programmatic offerings. Normalized for political and advocacy, our core business actually grew 6%. Core asset-supported streaming revenues rose 18% year-over-year, excluding political and advocacy. That continued double-digit growth in our foundational business, which made up 81% of total gross sales this quarter. That growth was led by our two newest offerings, which scaled significantly in Q1. International revenues surged nearly 13 times, up 1,173%, to 3.1 million U.S. from just $244,000 in Q1 of 2025, already representing 60% of our full-year 2025 record. Notably, this grew sequentially from a record $2.7 million in Q4, even though Q1 is a historically softer quarter for ad spending. We are seeing these levels remain steady in Q2. Our new programmatic offering is right behind it, also up nearly 13 times, or 1,175%, reaching $2 million from $156,000 in Q1 of 2025. Like international, programmatic also defies seasonal trends. 77% of programmatic customers renewed between Q4 and Q1, and 36% of those customers increased their spend if they moved into a seasonally softer quarter. Together, programmatic and international accounted for nearly 62% of our first quarter consolidated gross revenues. That highlights how quickly these new offerings are scaling. For context, in 2025, 82% of programmatic sales and 88% of international sales came in the second half of the year. As these businesses enter 2026 from a higher Q1 base, they'll be joined by a return of significant political advocacy dollars in the second half. Savio has already secured over $5 million in political advocacy commitments for 2026, with the bulk expected in the second half. Gross margin was 53% in the quarter. This reflects early pricing investments concentrated in January to drive adoption in their international and programmatic offerings, as well as the shift of higher margin political advocacy spend to the second half. Margins improved as the quarter progressed. Adjusted EBITDA was a loss of $3.4 million. This reflects the fact that higher margin political advocacy sales were largely replaced by lower-margin programmatic and international sales versus the prior year's quarter. Year-to-date, we've implemented $2.3 million in annual ed cost reductions. These savings will benefit the second quarter, with the full impact kicking in in Q3 right as material political and advocacy dollars returns. With accelerating momentum in our most scalable channels, a growing customer base, a leaner cost structure, and a strong pipeline of second-half political commitments, Savio is positioned for what we expect to be a record year and a return to strong profitability in the second half. Turning to capitalization, Savio ended the quarter with $1 million in cash. That outstanding under our U.S. and U.K. credit facilities declined to $6.2 million from $9.1 million at year-end coinciding with a decline in AR between Q4 and Q1. Sandville's receivables continue to show very low loss rates. This reflects a customer base made up primarily of major global brands and leading advertising agencies. As collections come in, they are used to repay our facilities, which can be redrawn for ongoing working capital needs, giving us a suffer-punishing source of liquidity. On the strength of our international business, Subsequent to quarter end, Savio was approved for an increase in its UK credit limit from £3 million to £5 million. We also supplemented this by issuing a $900,000 Canadian dollar convertible debt note. Together, these steps give Savio greater balance sheet flexibility as we enter what is historically our strongest revenue quarter of the year. Aziz, back to you.