Sabio Holdings Inc.

Joining us are founder and chief executive officer Aziz Rahimtoola and chief financial officer Sajid Premji. After management's remarks, we will open the call for questions. Analysts may raise your virtual hand 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 otherwise noted. With that, I turn it over to Aziz.

Thank you, Martin. Good morning, everyone. Q2 demonstrates how effectively we've been leveraging our tech stack and data backbone to scale our US programmatic and EMEA ad-supported streaming business. The growth of our US programmatic and EMEA momentum couldn't happen at a better time. We're benefiting from three shifts happening simultaneously. Client need to be in ad-supported streaming. transacted programmatically while having the option to scale it globally. 49% of Q2 revenue came from U.S. programmatic EMEA expansion, growing at a strong 290% year-to-year rate. We're not achieving this by sacrificing margins. We're actually expanding them sequentially to 61%. And we're growing it through new logos against the backdrop of political inadequacy historically skewed 70% in the second half of the year. We're executing and growing across all key metrics while becoming a leaner organization thanks to AI-driven efficiencies. I'm now going to hand it to Sajid Premji, our CFO, to dig into the numbers.

Thank you, Aziz. In Q2, we began to see the investments in efficiency work that we've been driving all year show up in the numbers, with a larger impact still to come in the second half. Gross and adjusted EBITDA margins expanded meaningfully, and our loss narrowed sequentially. Our newest growth channels, US Programmatic, and our international platform covering Europe, the Middle East, and Africa, or EMEA, continued to scale at a robust pace, with a 77% increase in new customer logos. Meanwhile, our more mature as supported streaming managed service business continues to underpin a strong 82% recurring revenue rate, including 92% in the US. While we face some of the same seasonal headwinds we called out last quarter, Savio's underlying business is moving in the right direction. Consolidated gross revenues were 9.7 million U.S., down from 11.7 million U.S. a year ago, primarily due to the absence of approximately 2.5 million U.S. in higher margin political and advocacy revenue, which in election years is historically concentrated in the second half. Normalized for that political advocacy spend, our brand business grew 6% year over year, driven by continued strength in our top logos, even as we absorbed that seasonal shift. As supported streaming, our foundational business came in at 6.2 million US compared with 7.9 million US a year ago. Once again, though, normalized for political and advocacy spend, brand results were largely flat, down about 2%, and that slight decline was due to an existing customer, a top global brand, shifting a specific high-dollar campaign into our new digital at-home offering, which we began monetizing this quarter. Excluding that shift, core streaming growth would have been positive, and as further evidence, our mobile business benefited from that same shift. Mobile growth sales were 3.5 million US compared with 3.6 million a year ago, and normalized for political advocacy, brand mobile sales were up 32% year over year, driven by that shift into our new digital at-home offering. US programmatic in EMEA again drove the growth story this quarter. U.S. programmatic sales reached 2.9 million U.S., up 240% year-over-year, and now representing 30% of consolidated gross sales. Our U.S. programmatic customer count grew 116% year-over-year, with 90% of Q1 programmatic customers renewing into Q2 and 79% of repeat U.S. programmatic customers increasing their spend. EMEA sales reached 1.9 million US, up 386% year over year. On a first half basis, EMEA sales reached 5 million and have already matched our full year 2025 EMEA revenue over that 12-month period. 54% of second quarter EMEA logos were new, up 343% year over year. And together, U.S. programmatic in EMEA represented 49% of our second quarter gross sales, up 10% from a year ago. Globally, new customer logos grew 77% year over year, representing 35% of our Q2 logo base. and the reoccurring revenue represented 82% of total revenues and 92% in the US, underscoring the visibility and predictability of our domestic revenue base. Gross margins came in at 61%, up eight points sequentially from 53% in the first quarter, driven by improved supply agreements, tech efficiencies and an improving sales mix. We expect continued margin improvement through the second half supported by these factors and the return of higher margin political and advocacy spend. Adjusted EBITDA was a loss of 2.7 million, narrowing sequentially from a loss of 3.4 million in Q1, an improvement of 14 percentage points on a margin basis. Our cost reduction initiatives are expected to deliver more than 2 million analyzed once fully implemented. As we head into the second half, we've already secured more than 5 million U.S. in political and advocacy commitments. Seasonality is meaningful for Savio's business. In 2025, 88% of EMEA revenue and 82% of U.S. programmatic sales came in the second half. And in our last political year, 2024, 69% of total revenues came in the second half of the year. With improving margins, a leaner cost structure, strong customer retention, and a substantial pipeline of second half political and advocacy commitments, we believe that Savio is positioned for adjusted EBITDA to return to profitability in the second half of 2026. Turning to capitalization, Savio ended the quarter with 1.5 million US in cash, up by 500K in Q1. Debt outstanding under our U.S. and U.K. credit facilities was roughly flat at $6.1 million compared to $6.2 million U.S. at the end of Q1 and down from $9.1 million at year-end. Sabio's receivables continue to show very low loss rates driven by a customer base made up primarily of major global brands and leading ad agencies. As collections come in, They're used to repair facilities which can be drawn on an ongoing basis for working capital needs, giving us a self-replenishing source of liquidity. On the strength of our international EMEA business during the quarter, Sabio was approved for an increase in its UK credit facility from 3 million British pounds to 5 million British pounds. We also supplemented this with a 900k Canadian The proceeds of which were used to secure higher margin direct supply. That supply helped drive gross margins to 67% in June, our strongest margin month of the year. Subsequent to quarter end, we further strengthened our position by raising 1.5 million US through a non-dilutive term loan secured by certain assets of our immediate operations. Together, these steps give Sabio greater balance sheet flexibility as we enter what is historically our strongest sales quarters of the years, including the capacity to secure a more higher margin direct supply ahead of the political season. Aziz, back to you.

Thank you, Sajid. To recap, in terms of our outlook ahead, core business is positioned strong for a growth back half. Our AI power programmatic capabilities continue delivering strong results with 90% renewal rate and growing. International expansion is continuing to accelerate. And then finally, 5 million employee advocacy is already committed to and secured. We will now open the line for questions. Analysts you may raise your virtual hand. Investors please submit questions into the question and answer window.

Gross margin has rebounded to 61% due to better supply agreements and technology efficiencies. Do you see further room for expansion above 61% as higher margin political revenue scales in the second half?

We do.

Go ahead, Ben.

No, sorry, Sajid. I got it. At this point, we want to focus in on expanding the business. And so 61% is a good margin for us. Yeah, sure. Sajid was just about to say there is an opportunity to expand more. But we are comfortable with the 61% margin. And really, our focus is to now get the top line revenue moving in the right direction at a double-digit as we were in the past. That's really our primary focus. So we do feel good with 61%, but we're not focusing on the margin at this point. We need to scale on the top line. Sajid?

Yeah, and I guess into that note, we definitely expect more consistency in our margin on a month-by-month basis in the second half of the year, which will benefit our business. As we kind of pointed out, In the transcript, our best month of the year and on a margin basis was June, where it was around 67%. You know, that was on the back of new supply deals that we were able to secure using the small financing that we did in April. And, you know, when we closed a couple of weeks ago, that will enable us to get more direct supply in to really secure that margin.

We will now take call some questions from analysts. I'm opening the line for Daniel Rosenberg. Daniel.

So my first question just comes around the outlook for the second half. You mentioned $5 million in secured sales already booked. You also alluded to 2024. I'm just wondering how that $5 million booked at this point compares to your 2024 experience.

Good morning, Daniel. Thank you for the question. At this point, we really haven't seen a whole lot of that just yet. As we mentioned, 70% of our political and advocacy as well as what we're seeing in top line growth from our brand business usually in political years happens in second half. So we haven't seen a lot of that, but we know we are being told it's coming in and it's going to be coming in strong. So we're feeling excited. Pretty bullish about that amount.

And then maybe anecdotally, obviously 2024 was a massive second half, so $16 million and $18 million in Q3 and Q4. So as you think about the momentum going into that quarter, is this the baseline that you're thinking about? Or where should we set our expectations?

The difference in and there's two key differences in 24 versus this year, first of which is obviously, as you mentioned, it was a national election cycle. And what happens is in 24 during a national election cycle, the two candidates already decided everything is squared away. And so what will happen is you will get some of those dollars, you know, a heavier portion of it also coming in in Q3. and then Q4 will continue that, specifically obviously October. And in a season where you have a lot of primaries and a lot of different candidates, you will see that uptake in Q3. but you know what we're seeing is advocacy tends to like backload in the second half of the year and so we're going to see a really strong push in Q4 and so we do feel is it going to be perfectly aligned to what we saw in 24 probably not but we're going to see very similar patterns we do believe though that Q4 will be heavier this year simply because we also have the benefit of international and so international continues to accelerate and Joe Camacho, Sajid Premji, Sajid, anything you want to add to that?

Yeah, I think that was well said. I think that Aziz pointed out that one big difference this year is that we do have these two big pillars in U.S. programmatic in EMEA International that wasn't there in 2024. And Aziz correctly pointed out, you know, last year, close to 90% of international sales were in the last half of the year, 50% of that, 50% of full-year sales in international came in Q4. US programmatic, a very similar story where more than 80% of second half sales last year came in the second half of the year. with Q4 being the biggest quarters. So we really are set up to benefit from those two tailwinds. And then you're adding political on top of that, which is gonna come in through that 5 million commitment plus other ones that we're working on as well. So we are expecting a big second half. That's all gonna be a lot more diversified than we were in the past.

And Daniel, I don't know if we mentioned this enough, but there were cost efficiencies that were recognized in the earlier part of this year. Those cost efficiencies are also going to hit in Q3, Q4. So that is really where the brunt of we're going to see some of these efficients come in. So similar pattern that we did in 24. What did we do? We tied in our belt at the end of 23, going into 24. We then accelerated up with cost efficiencies and really, you know, starts dropping more to the bottom line. So we're aiming for the same type of strategy here as we did in 24.

That's correct. Yeah, we generated, you know, if you look at 24, we generated about 5 million EBITDA in between the second half of the year. and we used that to significantly reduce our payables and really right-size our balance sheet and we're seeing a similar kind of game plan this time around.

Okay, so then turning to the balance sheet, you know, one difference is I would say you're in a different position today than you were back then. I know you did a finance and post quarter, but can you walk me through what those liabilities look like in the near term? I think you have within a year a number of things due and just how you intend to bridge to get that paid off.

Yeah, yeah. So I think that we did lean on payables and a balance sheet more in 2025. and Yerida Day in 2026. And that's, you know, is consistent with the working capital cycle that we have seen in non-political years, you know, a bit accentuated. But this does follow a pattern that we've seen before. You know, in 2023, payables increased all the way up to the second half of 2024. I mean, the first half of 2024. And then in the political spending return, we were able to make great headway. What's different now is that we do have U.S. programmatic in EMEA. and we continue to scale and diversify that revenue space and looking into the second half of 2026, we expect a similar dynamic. But I guess, you know, the issue really is that to address is that why is our balance sheet stretched at this point in time and how is that going to be corrected, right? And that's the brunt of your question there, Daniel. The investments that we've been making since the beginning of 2025 have really been aimed at getting the business out of that boom and bust cycle tied to the political cycle. So looking at 2025, we had about $10 million of political advocacy revenue to replace that was there in 2024 that dropped up in 2025. and we entered that year with no programmatic product at all. So zero sales there and an international business that ended 2024 with 1.4 million US of sales. So that's the base we had to absorb a $10 million loss in political sales. And you kind of compound that with tariff uncertainty that impacted second half spending. And that's exactly why 2025 was so difficult. It's a scale from a new law offerings just wasn't there yet. And so what has fundamentally changed is that if you fast forward to today, to the first half of 2026, U.S. programmatic and international combined are running each about $5 million apiece, so $10 million combined. In 2025, both of those businesses did more than 80% of their sales the second half of the year. But let's say we take a conservative approach, say it's an even 50-50 split, that's still a run rate of $20 million entering into 2027 versus the $1.4 million we had going into 2025. And so if 2027 brings a step down similar to what we had in 2025, we're still entering that base with a base that's 10 times larger to absorb it. and you kind of combine that with the cost cutting that Aziz pointed out, more than $2 million of annualized cost cutting, and that's what gives us the confidence that 2027 looks a lot more structurally different into 2023 or 2025, and that we'll be able to meet those down obligations. So yes, that transition has been a bit of a painful journey, and that shows up in the balance sheet in the first half of the year, but it had to be done, and the result is going to be a much more sustainable business.

Daniel, just to add to that, Sajid talked about how there is the legacy business, which is our managed service, CTVOTT, and how we are really transforming this business in a couple of ways. A, programmatic is what our clients are looking to use versus the managed service that we used to see in the past. And the reason for that is that it creates efficiencies for them and us. The ability to activate campaigns quicker in shorter cycles and also turn off when need be, as was caused during the tariffs. Sajid Premji Thanks for having me. While the numbers look single digit on a top line revenue, you know, in our brand business, that is what I think is missing in that whole picture is the fact that we are essentially moving out of this old business model of managed service very quickly and into a new AI driven programmatic capability that really is well suited for the marketplace and the growth that we're going to see in the coming years. So we're feeling good about the second half and not only second half, but really the momentum in 27 to then take care of these outstanding debt payments and paybacks that we need to take care of.

Maybe touching on that idea of CCTV versus mobile, I mean, obviously a lot of competition coming in the streaming space with the big platform streamers. I was wondering if you could speak to how you see the business along those lenses between mobile streaming, I guess basically the competitive dynamic that you're seeing.

Yeah, and we're seeing actually a CTV and ad supported streaming, CTV and OTT is going to continue growing. I mean, we see that as a huge opportunity. And look, reflective of the fact that we actually increased margins. And so there's an opportunity here that that is going to continue growing. Where it's growing at a faster rate than managed, sorry, a faster rate is programmatic versus managed. And when we first got into CTV OTT and we did the transition to mobile, we talked about how CTV was a new platform and we're seeing a tremendous amount of growth. Well, we're still seeing that growth. except that growth now is moving into programmatic. So it's CTVOTT, which is that supported streaming into programmatic. Mobile is actually having another, is having a resurgence as well as it relates to spend. So while it didn't show up this quarter, we do expect mobile, especially as it relates to political spending, to start showing up and some of the advocacy to start showing up. But really the way to think about this is CTVOTT, which is ad supported streaming, has a long ways to go and a lot of upside. And despite the fact, sure, there are going to be more competitors in the space and scale is going to be an issue, but we are actually friendlies with the competitors. In fact, we've just took up supply deals with some of the biggest players out there, including Tubi, which is now currently running directly from us in our platform. So there's a lot of direct supply deals that we're doing with these big streaming companies. And the reason clients are using us is not simply for the supply. That's not our value proposition. And that's why you don't see us talking about simply selling inventory, which is the SSP business model. We've made a very intentional, we've been very intentional in our approach to focus in on the higher margin business. Sure, we can show you top line growth and just Sajid Premji, Media is critical, and that's where we see a lot of opportunity. Because in the marketplace, you're right, there are going to be big players out there that are going to provide supply, but that does not mean they're going to be able to have a differentiated offering, whereas we do with AppScience and Creator TV.

Okay, appreciate that. Last question for me. I was just wondering if you could give us an up-to-date number on today's cash balance with that. I know post-quarter you did that to finance and then I'll pass the line. Thank you.

So it's, you know, while we don't kind of publicly disclose, you know, our history of interim monthly cash balances, it's very similar to what it was when we ended Q2.

Daniel, thank you for your questions. I will now open the call to Nicholas Cordolucci.

Hey guys, thanks for answering my questions and good morning here. The first thing I wanted to ask about was some of the operating expenses. So just looking quarter over quarter, we've seen a bit of an increase on S&M and G&A. It's down year over year, but just wanted to get some color on why it's increased quarter over quarter and what to expect going into the back half.

So the G&A expenses that increased quarter over quarter, that was tied to the headcount reductions that we've done. So we did a bit of an internal structure. And so there's costs involved in that. And so those were one time in nature. And so I think that if you're looking at the G&A line item, that's where that kind of shows up, although that was kind of reflected in their adjusted EBITDA number as well. Yeah. I think that, you know, looking ahead, those costs should be normalized and we should expect, you know, G&A to be quite steady.

That makes sense. And then maybe if you can show us some color on what sectors you're seeing positives from, what sectors are negative and taking away from your results.

The sectors that are still challenged, although we are seeing some turnaround there, is automotive. Automotive has traditionally been one of our largest sectors in the past. Automotive is still dealing with challenges associated with tariffs. And that is across the board. It's not just us. It's across countries. Every company in the ad space where we see the opportunities, we're seeing a lot of continued growth in places like quick service restaurant, as well as areas such as health care. and technology. So there are opportunities that are certainly growing at a faster rate, but we're, you know, we do believe there's, and also, you know, healthcare is, as we see by the jobless numbers in the US, healthcare continues to grow. That becomes, is becoming an area that we're seeing an opportunity to provide additional advertising capabilities to, as well as quick service restaurants.

Got it.

Okay.

And then just last one was on the revenue segments. You know, mobile has been... Up and down, CTV has shown some steadiness, but going forward into the second half, how do you see that break up between the two segments?

CTV is just going to continue growing. Ad-supported TV streaming is going to continue growing. The only reason you saw somewhat of a pullback in this Q2 was because, as Sajid mentioned, that was... It was absent of the advocacy and political that tends to take a lot of ad supported streaming. And so that will return in a bigger way the second half. So you're going to see that growth up. And then you will see mobile kind of moving up as well. But really ad supported streaming is going to be the major driver. Sajid, anything you want to add to that?

Yeah, yeah, I think just as we kind of put it out in the transcript too, you know, there was a legacy asset-supported streaming customer who spends routinely on asset-supported streaming, who had a kind of a, you know, specific requirements for just Q2 to kind of shift that to our new direct at-home offering. And so... We're really looking at

streaming, ad-supported video or ad-supported streaming, whether it's out of home or on digital. But we do see ad-supported streaming continuing to be the key driver. Understood. Okay, that's all for me.

Thanks, guys. Thank you for those questions. Savio generated approximately 5.1 million of international revenue during the first half of 2026, already exceeded the amount generated in all 2025. What is driving the international growth and where do you see the greatest opportunity?

Yeah, yeah, yeah. So I think that, you know, yeah, so that the sales for 2025, the first half where, you know, it's correct that it matched the full year sales of the first half of 26 matched the full year sales of 2025 at $5 million. And I guess, you know, what is driving that apparatus? Number one, we have a rapidly growing apparatus there. We know we've invested in the area, in the region. You know, we started out with, With one employee back in 2024, 2023-24, that footprint has grown to around eight. You know, as we continue to grow in the region, those employees are being bolstered by now the rollout of an AppScience household graph for the UK region. And so now we're able to bring the similar value that we already provide our US customers to international. And that's really is propelling, really enhancing and accelerating the sales over there in that region. And so that's why it makes us even more optimistic and bullish for the second half of this year and going to 27 is that if you think about it, our international sales were able to do what they've done without the help of a UK graph up until around April this year. With that introduction, we've seen international sales continue on strong and we're seeing continued appetite for that, those nuances and those targeting. So we're very bullish on our prospects going forward.

And keep in mind, and to Sajid's point, that graph is critical and it continues to be our differentiation. And that's why what you're seeing is our margins are holding. You'll see our competitors in the space and people are really kind of diving because it's been a challenging environment, not just for ourselves, but for a lot of other companies and media. And so what are they resorting to? Just simply selling inventory. We refuse to sell inventory, refuse to do that. What we're focusing on is to sell targeted inventory backed by insights and analytics and now rolling out creator television, which is expanding globally. And so we have a differentiated offering. It doesn't always show up on the numbers in terms of growth, but it is showing up on our margin profile relative to our competitors in the space. And I think that's really what I would ask investors to look at. Thank you for joining us. Thank you for having me. to differentiated data and differentiated inventory. That is the key difference, not only just in the international market, but it's going to be a key difference in our U.S. market. That takes investment, and we've done those investments, and now we're starting to reap the benefits of that.

With the launch of the UK household graph in April, how quickly do you expect that infrastructure to drive local margin expansion similar to your more mature US operations?

Well, we didn't break it out. It already has started to do that. So we've already seen the benefits of that, and we're going to continue seeing that. And we're going to continue adding to it, providing new value to our customers in the form of deeper insights and understanding that they didn't have before. and I think that's exactly what we're doing in the U.S. market in key categories. And Sajid mentioned this on the out-of-home product. We saw an opportunity in the out-of-home space where there was a lack of insights and understanding A major lack of insights and understanding. And so that's why we were asked by one of our clients to consider doing it because they saw the value of our insights and data on ad-supported streaming. And that really necessitated our expansion there. And we've seen a lot of great success on multiple fronts because efficiency is the name of the game. And when you have something like AppScience, the 80 million household graph in the U.S., and we have a separate graph now in the U.K., Efficiency is what our clients are looking for. They're not just looking for supply. They can buy supply from everybody. What they're looking for us from is efficiency and targeting that helps them not only reach those audiences more effectively, but validate them.

Approximately 90% of programmatic customers renewed from Q1 to Q2. What specific attributes of AppScience Stack are driving this high retention?

That's a harder question to answer just simply because of the fact that because the way the programmatic platform and how you interact with clients has significantly changed from how we would interact on managed service. What we know is working is the data is working. The data is differentiated because in a programmatic environment, that is a lot more sink or swim than in managed. In managed, you could optimize the campaigns. The data is working. The differentiated capabilities in terms of the targeting is working. And that is, you know, they've told us, you know, their vote of confidence is the renewal. and that's all we get to see. We don't see anything. Now, certainly on our end, we're doing constant analysis and looking at what we potentially can do to increase those segments and increase the targeting capabilities. But really, we have no transparency into why those clients are using this. We do know that they are and many more. Once we turn it on, we're seeing more consistency in revenue spend. And I'll kind of juxtapose that from what happens in managed service. In managed service, you go out and you do a request for proposal every quarter, usually, unless you have a front deal, which we do with some folks. But let's assume we don't. You do a request for proposal every quarter and you resubmit paperwork, you resubmit ideas and opportunities. In programmatic, once that pipe turns on, it doesn't turn off. Thank you for watching. Thank you.

Can you comment on how are your revenue sharing arrangements structured on the Creator TV network and how do they impact net revenue margins recognized on those ad impressions?

Yeah, yeah. So I think that, you know, it typically is a rev share arrangement with the creators based on what it would be a typical supply cost to the company. And so I think that, you know, the benefit of that business is that you are able to keep a bit more of that margin in-house. So, you know, while, you know, you may have those You know, a margin of X on your service business, you might be able to have actually a bit higher of a margin on creator TV just because you are keeping a bit more of that cash in-house within your own supply. Right. You're basically serving the brand your own supply. So there's definitely a benefit there. And it's also it's a it's a great tool you find in order to help. You know, drive further brand engagement with the Savio brand, you know, because now we, you know, what differentiates Savio, right? I mean, app science is definitely a big differentiator for us in that household graph. And now we have something else. We have our own owned and operated supply. And that supply is a supply that's targeting a very desirable demographic, you know. Younger in age, people who are spending and people who, you know, are really engaged with the celebrities of today, which are influencers. And so, you know, we're right in that wheelhouse.

Well, and also, you know, one of the other ways that businesses continue to evolve, too, where now we have the ability to do on-site events. And if you can imagine, you know, our most recent VidCon event, the folks we had playing VidCon, we had a VidCon pickleball tournament. and VidCon is the biggest creator event in the US. And after that VidCon pickleball tournament that we did, that we were invited by VidCon to do, we had upwards of all of the creators that were playing, they had 800 million followers. The creators we had play in a tournament had 800 million followers in terms of in their personal reach. And if you think about how that translates to a brand business, that is huge. In a world where it's a fragmented media ecosystem and now the brand has an opportunity to activate on site in that kind of environment. That helps us from a sales perspective on the Sabio brand business. But could you imagine if you were a major quick service restaurant brand, and now you're going to be integrated into some of these events, that level of exposure that is uniquely Sabio is going to be the opportunity. And I think that's what we're doing. And that's how the way we're going to be able to... to defend margin is not simply selling supply on an arbitrage basis. We have to defend margin with the new product set and the ability of AppScience to do that on programmatic and Creator TV to do that on a onsite and then a unique supply basis. So we have a few different options that we are now kind of, because sure, everyone could have a high revenue business, but what's the margin like? We all know that at the end of the day, if you cannot manage margins, you don't have a real business.

And to clarify that, you capture the higher margin because they are better targeted ads, so the advertisers are willing to pay more for that?

Yeah, that's exactly right. It is, they're more efficient. We can validate those ads using AppScience. Separately on the creator side is simply that, like, you don't have this opportunity. It's not available on other platforms. And so, you know, we're still, that creator TV impression count is still growing. But then also the activation of being able to participate in a VidCon, in a, you know, creator Pokeball, Sajid Premji And so that allows us to move those, you know, the targeting and the margin. And this is, you know, one of the things we should highlight is we did, but it's not said enough. We increased margins without any high margin political advocacy, a whole lot of it in Q2. So, you know, as Sajid was saying, his belief in the margins are going to go up, he's absolutely right. We do expect the margins to go up in the rest of this year because political advocacy brings in higher margin business. So we actually did the margin increase without any of the high margin business that is political advocacy, which we're super excited about.

And just going back to your question as well, Martin, just to add to that, and I You know, if a campaign came to us and they want to do some targeting, if we didn't have AppSci, if you have to pay someone else for that kind of data, right? We're having our own tech stock. We're able to keep that in-house, use our own in-house operation, which will be cheaper for us than going to an outside source.

and be able to connect those analytics to out of home, to mobile, to CTV, to creator content they're running, not only on creator TV and CTV, but then potentially YouTube. So this idea of connecting the dots is the real app science opportunity. And if you're a brand, You're saying to yourself, yeah, I spend money here out of home and I'm spending separately here and no one is helping me connect the dots of efficiency and really connect the dots from a data perspective and a conversion perspective. We're doing that overall in the modern world. I mean, there's people who are obviously doing it on display, but we're actually doing it on the platforms that people are using today.

Thank you. Will Sabio return to positive adjusted EBITDA in the second half of 2026? If so, what gives you the confidence of this outlook?

Yeah, I mean, we feel that we're very well positioned to return adjusted EBITDA profitability in the second half of the year. Obviously, as a company, you can't make a sweeping statement like a guarantee, but all the tools are in place. You basically have the cost cutting that we did this year that is going to save $2 million of an annual interest rate, and the brunt of that can be felt in Q3 and Q4. You have your gross margins increasing as we saw between Q1 and Q2. And as he's pointed out, that's before the return of higher margin political advocacy in the second half of the year. You have a $5 million commitment from political advocacy agencies for the majority of which will be spent in the second half of the year. And there's more spending in the scatter on top of that. and then that's not even counting your international business in EMEA and also your U.S. programmatic businesses. Each one of them either matched their full year sales last year or was close to matching their full year sales from last year at the end of the first half of this year. Typically, those businesses do see a step up between this first half and the second half. So while nothing is guaranteed, if you look at all the different ingredients in this pot of stew, I mean, it's all coming together. And so we've never been in a better position, I think, in our history to be profitable.

And with the exception of last year, traditionally in the 11 years I've been running this company, 60%, and this is an off-election year, 60% of our revenue sits in Q3, Q4. The only reason that didn't happen last year is because the tariffs hit in May and June, and it was a surprise for a lot of our clients on the backside. So they had to deal with changes and pull back on spending, specifically, especially automotive, last year in second half. Thank you for joining us. We've never seen it is always in at least 60%, if not more, in the second half of the year, with the exception of last year because of the tariffs hitting in Liberation Day in May and June of last year and surprising everything in the second half of the year.

Yeah, I mean, last year was the only year since we went public where we weren't profitable in the second half of the year. So there's great historical precedent there.

Thank you very much. There are no further questions. Thank you for joining us today, everyone. And this concludes Savio Holdings Earnings