What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2026-05-12 compared with 2025-11-07 · 110 added, 211 removed, 216 unchanged (60% of the section changed)

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Factors that could cause or contribute to these differences include, but are not limited to, those identified below, and in the section "Cautionary Statement Regarding Forward-Looking Information", those discussed in “Item 1A.

Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2024, and those discussed in any subsequent filing we make with the SEC.

Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2025, and those discussed in any subsequent filing we made with the SEC.

Business Overview

42 unchanged sentences

Limited Number of Customers .

During the nine months ended September 30, 2025 one customer represented 14.4% of revenue.

During the nine months ended September 30, 2024 one customer represented 13.4% of revenue.

The loss of this customer could have a material adverse impact on our results of operations in future periods.

During the three months ended March 31, 2026, three customers represented 48.9% of revenue.

During the three months ended March 31, 2025, one customer represented 15.4% of revenue.

The loss of these customers could have a material adverse impact on our results of operations in future periods.

Managing Industry Dynamics .

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We monitor the following key financial and operational metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans, and make strategic decisions.

The following is our analysis for the three and nine months ended September 30, 2025 and 2024:

Three Months Ended September 30,

Nine Months Ended September 30,

The following is our analysis for the three months ended March 31, 2026 and 2025:

Three Months Ended March 31,

(in thousands)

1 unchanged sentence

General and administrative expenses

Income (loss) from operations

Financing and other expense, net

Adjusted EBITDA (loss) (1)

Adjusted EBITDA (1)

(1) - For a reconciliation of net loss to Adjusted EBITDA see "Use of Non-GAAP Financial Measures" below.

5 unchanged sentences

• provision of creative and media services to advertisers.

Revenue decreased by $211,000, or 1%, for the three months ended September 30, 2025, compared to the same period in 2024.

Revenue increased by $3.9 million, or 10%, for the nine months ended September 30, 2025, compared to the same period in 2024.

See below for a detailed analysis of revenue for the three and nine months ended September 30, 2025, and 2024.

Revenue decreased by $227,000, or 2%, for the three months ended March 31, 2026, compared to the same period in 2025.

See below for a detailed analysis of revenue for the three months ended March 31, 2026 and 2025.

Cost of Revenue

Cost of revenue includes internal labor and payment to third parties for services performed to drive revenue, which includes the publisher cost paid for ad exchange on third party sites, advertising fees, personnel costs, technology and data related costs, fees paid for content creation, influencers, writers, and sales commission.

Cost of revenue decreased by $78,000, or 1%, for the three months ended September 30, 2025 compared to the same period in 2024.

Cost of revenue increased by $3.3 million, or 12%, for the nine months ended September 30, 2025, compared to the same period in 2024.

See below for a detailed analysis of cost of revenue for the three and nine months ended September 30, 2025, and 2024.

Cost of revenue decreased by $264,000, or 3%, for the three months ended March 31, 2026, compared to the same period in 2025.

See below for a detailed analysis of cost of revenue for the three months ended March 31, 2026 and 2025.

General and Administrative Expenses

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and (v) facility costs.

General and administrative expenses decreased by $315,000, or 7%, for the three months ended September 30, 2025 compared to the same period in 2024.

General and administrative expenses decreased by $2.3 million, or 16%, for the nine months ended September 30, 2025, compared to the same period in 2024.

See below for a detailed analysis of general and administrative expenses for the three and nine months ended September 30, 2025 and 2024.

General and administrative expenses decreased by $2.0 million, or 43%, for the three months ended March 31, 2026, compared to the same period in 2025.

See below for a detailed analysis of general and administrative expenses for the three months ended March 31, 2026 and 2025.

Results of Operations

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This analysis should be read in conjunction with the consolidated financial statements and the notes to those statements that are included elsewhere in this Quarterly Report on Form 10-Q.

Three Months Ended September 30, 2025 Compared to Three Months Ended September 30, 2024

Net loss for the quarter ended September 30, 2025 was $2.8 million as compared to a net loss of $3.3 million for the same period in 2024.

Three Months Ended March 31, 2026 Compared to Three Months Ended March 31, 2025

Net loss for the quarter ended March 31, 2026 was $1.3 million as compared to a net loss of $3.2 million for the same period in 2025.

The following is our analysis for the period:

Three Months Ended September 30,

Three Months Ended March 31,

(in thousands)

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Gross margin percentage

Our revenue decreased by $211,000, or 1%, for the three months ended September 30, 2025, compared to the same period in 2024.

Revenue decreased by $227,000, or 2%, for the three months ended March 31, 2026, compared to the same period in 2025.

The Company focuses on digital publishing, advertising technology, consumer insights, creative services, and media services.

Changes in revenue generated by each such division are set forth below:

Three Months Ended September 30,

Three Months Ended March 31,

(in thousands)

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Media services

Total revenue

Digital Publishing

Digital publishing revenue decreased by $239,000, or 46%, for the three months ended September 30, 2025, compared to the same period in 2024.

Approximately $280,000, or 2%, of the Company’s revenue for the three months ended September 30, 2025, was generated from our digital publishing customers, compared to $519,000, or 4%, for the same period in 2024.

This division was significantly impacted by macroeconomic factors, which reduced traffic to our website, coupled with an overall reduction in spending by some customers related to inflationary concerns.

Digital publishing revenue decreased by $302,000, or 52%, for the three months ended March 31, 2026, compared to the same period in 2025.

Approximately $281,000, or 2%, of the Company’s revenue for the three months ended March 31, 2026, was generated from our digital publishing customers, compared to $583,000, or 4%, for the same period in 2025.

This reduction was primarily due to macroeconomic factors, which reduced traffic to our website, coupled with an overall reduction in spending by some customers related to inflationary concerns.

Advertising Technology

Advertising technology revenue increased by $412,000, or 9%, for the three months ended September 30, 2025, compared to the same period in 2024.

Approximately $5.1 million, or 36%, of the Company’s revenue for the three months ended September 30, 2025, was generated from our advertising technology customers compared to $4.7 million, or 33%, for the same period in 2024.

Advertising technology revenue increased by $2.4 million, or 57%, for the three months ended March 31, 2026, compared to the same period in 2025.

Approximately $6.6 million, or 48%, of the Company’s revenue for the three months ended March 31, 2026, was generated from our advertising technology customers compared to $4.2 million, or 30%, for the same period in 2025.

This growth was driven by our ability to leverage our resources to attract top advertisers, which in turn allowed us to onboard premium publishers.

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Consumer Insights

Consumer insights revenue decreased by $403,000, or 6%, for the three months ended September 30, 2025, compared to the same period in 2024.

Approximately $6.4 million, or 46%, of the Company’s revenue for the three months ended September 30, 2025 was generated from our consumer insights customers compared to $6.8 million, or 48%, for the same period in 2024.

Consumer insights revenue decreased by $2.0 million, or 28%, for the three months ended March 31, 2026, compared to the same period in 2025.

Approximately $5.0 million, or 36%, of the Company’s revenue for the three months ended March 31, 2026, was generated from our consumer insights customers compared to $7.0 million, or 49%, for the same period in 2025.

This decrease was driven by a decrease in contract value for certain larger tier revenue customers.

Creative Services

Creative services revenue decreased by $119,000, or 7%, for the three months ended September 30, 2025, compared to the same period in 2024.

Approximately $1.5 million, or 11%, of the Company’s revenue for the three months ended September 30, 2025, was generated from our creative services customers compared to $1.6 million, or 11% for the same period in 2024.

Creative services revenue increased by $490,000, or 33%, for the three months ended March 31, 2026, compared to the same period in 2025.

Approximately $2.0 million, or 14%, of the Company’s revenue for the three months ended March 31, 2026, was generated from our creative services customers compared to $1.5 million, or 11% for the same period in 2025.

This increase was driven by an increase in the number of projects for smaller tier revenue customers.

Media Services

Media services revenue increased by $138,000, or 23%, for the three months ended September 30, 2025, compared to the same period in 2024.

Approximately $728,000, or 5%, of the Company’s revenue for the three months ended September 30, 2025, was generated from our media services customers compared to $590,000, or 4%, for the same period in 2024.

This increase was primarily related to the timing of customer needs.

Media services revenue decreased by $829,000, or 99%, for the three months ended March 31, 2026, compared to the same period in 2025.

Approximately $12,000, or 0.1%, of the Company’s revenue for the three months ended March 31, 2026, was generated from our media services customers compared to $841,000, or 6%, for the same period in 2025.

Cost of Revenue

Three Months Ended September 30,

Three Months Ended March 31,

(in thousands)

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Sales commissions

Cost of revenue decreased by $78,000, or 1%, for the three months ended September 30, 2025, compared to the same period for 2024.

This decrease is due to the factors discussed below:

Total cost of revenue

Cost of revenue decreased by $264,000, or 3%, for the three months ended March 31, 2026, compared to the same period in 2025.

This decrease was due to the factors discussed below:

Direct Salaries and Labor Cost

Direct salaries and labor cost remained consistent, with a slight increase of $5,000 for the three months ended September 30, 2025, when compared to the same period in 2024.

Approximately $1.5 million, or 16%, of the Company's cost of revenue for the three months ended September 30, 2025, was a result of direct salaries and labor cost compared to $1.5 million, or 15%, for the same period in 2024.

These costs represent salary and labor cost of employees that work directly on customer projects for our consumer insights, creative services, and media services divisions.

Direct salaries and labor cost decreased by $1.4 million, or 80%, for the three months ended March 31, 2026, compared to the same period in 2025.

Approximately $371,000, or 4%, of the Company's cost of revenue for the three months ended March 31, 2026, was a result of direct salaries and labor cost compared to $1.8 million or 18%, for the same period in 2025.

This decrease was related to our continued efforts to decrease headcount.

These costs represent salary and labor cost of employees who work directly on customer projects for our consumer insights, creative services, and media services divisions.

Direct Project Cost

Direct project cost decreased by $613,000, or 20%, for the three months ended September 30, 2025 when compared to the same period in 2024.

Approximately $2.4 million, or 25%, of the Company's cost of revenue for the three months ended September 30, 2025, was a result of direct project cost compared to $3.0 million, or 31%, during the same period in 2024.

This decrease was consistent with the decrease in revenue from our consumer insights division.

Direct project cost decreased by $2.4 million, or 67%, for the three months ended March 31, 2026, compared to the same period in 2025.

Approximately $1.2 million, or 12%, of the Company's cost of revenue for the three months ended March 31, 2026, was a result of direct project cost compared to $3.6 million, or 37%, during the same period in 2025.

This decrease was related to a decrease in customer contracts.

These costs include payments made to third-parties that are directly attributable to the completion of projects that allow for revenue recognition for our consumer insights, creative services, and media services divisions.

Non-Direct Project Cost

Non-direct project cost decreased by $229,000, or 13%, for the three months ended September 30, 2025 when compared to the same period in 2024.

Approximately $1.5 million, or 16%, of the Company's cost of revenue for the three months ended September 30, 2025, was a result of non-direct project cost compared to $1.8 million, or 18%, for the same period in 2024.

This decrease is related to our continued efforts to decrease headcount.

Non-direct project cost increased by $1.4 million, or 143%, for the three months ended March 31, 2026, compared to the same period in 2025.

Approximately $2.4 million, or 25%, of the Company's cost of revenue for the three months ended March 31, 2026, was a result of non-direct project cost compared to $1.0 million, or 10%, for the same period in 2025.

This increase is consistent with the increase noted in revenue from our creative services division.

These costs represent overall client service costs that are not specifically related to a particular project, but relate to services for our consumer insights, creative services, and media services divisions.

Publisher Cost

Publisher cost was $3.7 million, which represents 39% of overall cost of revenue, and $3.0 million, or 31%, of overall cost of revenue, for the three months ended September 30, 2025 and 2024, respectively.

We experienced an increase of $716,000, or 24%, for the three months ended September 30, 2025, compared to the same period in 2024.

In 2024, we ran political campaigns with margins better than our average.

We did not run similar campaigns in 2025, and as a result, in 2025 our margins were lower.

In 2025, we have had higher costs with publishers in connection with the revenue obtained from ad sales.

Publisher cost increased by $1.9 million, or 62%, for the three months ended March 31, 2026, compared to the same period in 2025.

Approximately $4.9 million, or 51%, of the Company's cost of revenue for the three months ended March 31, 2026, was a result of publisher cost compared to $3.0 million, or 31%, for the same period in 2025.

This increase is consistent with the increase noted in revenue from our advertising technology division.

These costs represent payments to media providers and website publishers.

Gross margin was $4.3 million and $4.4 million for the three months ended September 30, 2025 and 2024, respectively.

Our gross margin decreased by $133,000, or 3%, for the three months ended September 30, 2025, when compared to the same period of 2024.

Gross margin as a percentage of revenue remained consistent at 31% for the three months ended September 30, 2025 and 2024.

Gross margin was $4.3 million and $4.3 million for the three months ended March 31, 2026, and 2025, respectively.

Our gross margin remained consistent for the three months ended March 31, 2026, when compared to the same period of 2025.

Gross margin as a percentage of revenue increased to 31% for the three months ended March 31, 2026, compared to 30% for the same period of 2025 due to the slight decrease in cost of revenue.

General and Administrative Expenses

Three Months Ended September 30,

Three Months Ended March 31,

(in thousands)

1 unchanged sentence

Professional fees

Website expenses

Data processing

Total general and administrative expense

Gross margin as a percentage of general and administrative expense

General and administrative expenses decreased by $315,000, or 7%, for the three months ended September 30, 2025, compared to the same period in 2024.

The decrease is due to a combination of factors as discussed below:

General and administrative expenses decreased by $2.0 million, or 43%, for the three months ended March 31, 2026, compared to the same period in 2025.

The decrease was due to a combination of factors as discussed below:

Personnel Cost

Personnel cost decreased by $270,000, or 14%, for the three months ended September 30, 2025, compared to the same period in 2024.

Personnel cost decreased by $173,000, or 9%, for the three months ended March 31, 2026, compared to the same period in 2025.

This change was mainly driven by a decrease in the Company's head count by a net change of 17 employees.

The Company employee's headcount was 113 and 141 at September 30, 2025 and 2024, respectively.

Legal fees increased by $302,000, or 191%, for the three months ended September 30, 2025, compared to the same period in 2024.

This increase was due largely to payments made as part of the ongoing litigation with Ladenburg.

The Company's employee headcount was 99 and 116 at March 31, 2026 and 2025, respectively.

Legal fees decreased by $1.6 million, or 347%, for the three months ended March 31, 2026, compared to the same period in 2025.

This decrease was due largely to a $1.1 million gain related to a non-recurring settlement of ongoing litigation with Ladenburg.

See Note 15, Commitments and Contingencies, to the consolidated financial statements.

Website Expenses

Website expenses decreased by $153,000, or 44%, for the three months ended September 30, 2025, compared to the same period in 2024.

This decrease was related to a reclassification of certain components of software costs from website expenses to cost of revenue.

Financing Expense (Income)

Three Months Ended September 30,

(in thousands)

Interest expense

Other expense (income)

Total financing and other expense, net

Financing and other expense, net, decreased by $242,000, or 7%, for the three months ended September 30, 2025, compared to the same period in 2024.

This decrease is related to a decrease in interest paid under the Centre Lane Senior Secured Credit Facility due to greater capitalization of interest in the current year.

See Note 10, Centre Lane Senior Secured Credit Facility, to the consolidated financial statements.

Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024

Net loss for the nine months ended September 30, 2025 was $10.1 million as compared to a net loss of $13.2 million for the same period in 2024.

The following is our analysis for the period:

Nine Months Ended September 30,

(in thousands)

Cost of revenue

General and administrative expenses

Loss from operations

Financing and other expense, net

Gross margin percentage

Our revenue increased by $3.9 million, or 10%, for the nine months ended September 30, 2025, compared to the same period in 2024.

The increase in revenue was largely attributable to our advertising technology division.

The Company focuses on digital publishing, advertising technology, consumer insights, creative services, and media services.

Changes in revenue generated by each such division are set forth below:

Nine Months Ended September 30,

(in thousands)

Digital publishing

Advertising technology

Consumer insights

Creative services

Media services

Digital Publishing

Digital publishing revenue decreased by $246,000, or 17%, for the nine months ended September 30, 2025, compared to the same period in 2024.

Approximately $1.2 million, or 3%, of the Company’s revenue for the nine months ended September 30, 2025 was generated from our digital publishing customers, compared to $1.5 million, or 4%, for the same period in 2024.

Advertising Technology

Advertising technology revenue increased by $3.5 million, or 33%, for the nine months ended September 30, 2025, compared to the same period in 2024.

Approximately $14.4 million, or 33%, of the Company’s revenue for the nine months ended September 30, 2025 was generated from our advertising technology customers compared to $10.9 million, or 28%, for the same period in 2024.

This growth was driven by our ability to leverage our resources to attract top advertisers, which in turn has allowed us to onboard premium publishers.

This led to an increase in volume, as well as rates and overall revenue.

Consumer Insights

Consumer insights revenue increased by $601,000, or 3%, for the nine months ended September 30, 2025, compared to the same period in 2024.

Approximately $20.7 million, or 48%, of the Company’s revenue for the nine months ended September 30, 2025 was generated from our consumer insights customers compared to $20.1 million, or 51%, for the same period in 2024.

Creative Services

Creative services revenue decreased by $607,000, or 11%, for the nine months ended September 30, 2025, compared to the same period in 2024.

Approximately $4.7 million, or 11%, of the Company’s revenue for the nine months ended September 30, 2025 was generated from our creative services customers compared to $5.3 million, or 13% for the same period in 2024.

This decrease was primarily related to a decrease in the number of projects for smaller tier revenue customers.

Media Services

Media services revenue increased by $642,000, or 36%, for the nine months ended September 30, 2025, compared to the same period in 2024.

Approximately $2.4 million, or 6%, of the Company’s revenue for the nine months ended September 30, 2025 was generated from our media services customers compared to $1.8 million, or 5%, for the same period in 2024.

This increase was primarily related to the timing of customer needs and the moving of certain projects from year-end 2024 to the first three quarters of 2025.

Cost of Revenue

Nine Months Ended September 30,

(in thousands)

Direct salaries and labor costs

Direct project costs

Non-direct project costs

Publisher costs

Content creation

Sales commissions

Cost of revenue increased by $3.3 million, or 12%, for the nine months ended September 30, 2025, compared to the same period for 2024.

This increase is due to the factors discussed below:

Direct Salaries and Labor Cost

Direct salaries and labor cost decreased by $394,000, or 7%, for the nine months ended September 30, 2025, when compared to the same period in 2024.

Approximately $5.2 million, or 16%, of the Company's cost of revenue for the nine months ended September 30, 2025 was a result of direct salaries and labor cost compared to $5.6 million, or 22% for the same period in 2024.

These costs represent salary and labor cost of employees that work directly on customer projects for our consumer insights, creative services, and media services divisions.

Direct Project Cost

Direct project cost increased by $1.7 million, or 19%, for the nine months ended September 30, 2025, when compared to the same period in 2024.

Approximately $10.9 million, or 34%, of the Company's cost of revenue for the nine months ended September 30, 2025 was a result of direct project cost compared to $9.2 million, or 32%, during the same period in 2024.

This increase was related to an increase in customer contracts.

Non-Direct Project Cost

Non-direct project cost was $3.7 million, or 12%, of the Company's cost of revenue for the nine months ended September 30, 2025, compared to $5.5 million, or 19%, for the same period in 2024.

The decrease of $1.8 million is related to our continued efforts to decrease headcount.

Publisher Cost

Publisher cost was $10.5 million, which represents 33% of overall cost of revenue, and $7.1 million, or 25%, of overall cost of revenue, for the nine months ended September 30, 2025 and 2024, respectively.

We experienced an increase of $3.3 million, or 47%, for the nine months ended September 30, 2025, compared to the same period in 2024.

In 2024, we ran political campaigns with margins better than our average.

We did not run similar campaigns in 2025, and as a result, in 2025 our margins were lower.

In 2025, we have had higher costs with publishers in connection with the revenue obtained from ad sales.

These costs represent payments to media providers and website publishers.

Gross margin was $11.6 million and $10.9 million for the nine months ended September 30, 2025 and 2024, respectively.

Our gross margin increased $617,000, or 6%, for the nine months ended September 30, 2025, when compared to the same period of 2024.

Gross margin as a percentage of revenue decreased to 27% for the nine months ended September 30, 2025, compared to 28% for the same period of 2024 due to the higher cost of revenue.

General and Administrative Expenses

Nine Months Ended September 30,

(in thousands)

Personnel costs

Professional fees

Website expenses

Data Processing

Gross margin as a percentage of general and administrative expense

General and administrative expenses decreased by $2.3 million, or 16%, for the nine months ended September 30, 2025, compared to the same period in 2024.

The decrease is due to a combination of factors as discussed below:

Personnel Cost

Personnel cost decreased by $1.5 million, or 22%, for the nine months ended September 30, 2025, compared to the same period in 2024.

This change was mainly driven by a decrease in the Company's head count by a net change of 28 employees.

The Company employee's headcount was 113 and 141 at September 30, 2025 and 2024, respectively.

Insurance Cost

Insurance cost decreased by $215,000, or 35%, compared to the same period in 2024.

This change was mainly driven by a reform of the Company's management liability insurance program, including changes to insurance providers, resulting in a decrease in premiums from the prior year.

Legal fees increased by $169,000, or 18%, for the nine months ended September 30, 2025, compared to the same period in 2024.

This increase was due largely to payments made as part of the ongoing litigation with Ladenburg.

See Note 16, Commitments and Contingencies, to the consolidated financial statements.

Website Expenses

Website expenses decreased by $352,000, or 34%, for the nine months ended September 30, 2025, compared to the same period in 2024.

Data processing expenses decreased by $252,000, or 40%, for the three months ended March 31, 2026, compared to the same period in 2025.

This decrease was related to a reclassification of certain components of software costs from website expenses to cost of revenue.

Data Processing

Data processing decreased by $357,000, or 37%, for the nine months ended September 30, 2025, compared to the same period in 2024.

This reduction was due largely to the reclassification of certain components of data processing costs from data processing to website expenses.

Financing Expense (Income)

Nine Months Ended September 30,

Three Months Ended March 31,

(in thousands)

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Total financing and other expense, net

Financing and other expense, net, decreased by $146,000, or 2%, for the nine months ended September 30, 2025, compared to the same period in 2024.

This decrease is related to a decrease in interest paid under the Centre Lane Senior Secured Credit Facility due to greater capitalization of interest in the current year.

See Note 10, Centre Lane Senior Secured Credit Facility, to the consolidated financial statements.

Use of Non-GAAP Financial Measure

Financing and other expense, net, increased by $64,000, or 2%, for the three months ended March 31, 2026, compared to the same period in 2025.

Use of Non-GAAP Financial Measures

Non-GAAP results are presented only as a supplement to the financial statements and for use within management's discussion and analysis based on accounting principles generally accepted in the United States of America ("GAAP").

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A reconciliation of net loss before taxes to non-GAAP EBITDA and Adjusted EBITDA is as follows:

Three Months Ended September 30,

Nine Months Ended September 30,

Three Months Ended March 31,

(in thousands)

Net loss before tax

Net loss before income tax

Depreciation expense

2 unchanged sentences

Other interest expense

Interest expense - Centre Lane Senior Secured Credit Facility and Convertible Promissory Notes

EBITDA (loss)

Interest expense - Centre Lane Senior Secured Credit Facility

Stock compensation expense

2 unchanged sentences

Non-recurring severance expense

Adjusted EBITDA (loss)

Adjusted EBITDA

Liquidity and Capital Resources

Liquidity is the ability of a company to generate sufficient cash to satisfy its needs for cash.

The following table summarizes total current assets, total current liabilities, and net working capital (deficit) as of September 30, 2025, as compared to December 31, 2024.

September 30, 2025

The following table summarizes total current assets, total current liabilities, and net working capital (deficit) as of March 31, 2026, as compared to December 31, 2025:

March 31, 2026

December 31, 2025

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Net working capital (deficit)

As of September 30, 2025, we had a cash balance of $553,000 and a restricted cash balance of $1.9 million compared with a cash balance of $2.5 million and a restricted cash balance of $1.9 million as of December 31, 2024.

As of March 31, 2026, we had a cash balance of $594,000 and a restricted cash balance of $1.9 million, compared with a cash balance of $1.4 million and a restricted cash balance of $1.9 million as of December 31, 2025.

Subsequent decreases in restricted cash associated with the settlement agreement entered into with Ladenburg are discussed further in Note 15, Commitments and Contingencies, and Note 20, Subsequent Events, to the consolidated financial statements.

The Company’s liquidity needs, and a discussion of how it intends to meet those needs, is discussed below.

See – “Going Concern.”

See "Going Concern" below.

Going Concern

Historically, the Company has incurred losses, which have resulted in an accumulated deficit of approximately $177.0 million as of September 30, 2025.

Cash flows provided by (used in) operating activities were $347,000 and $(451,000) for the nine months ended September 30, 2025 and 2024, respectively.

As of September 30, 2025, the Company had a working capital deficit of approximately $17.3 million, inclusive of $553,000 in cash and cash equivalents and $1.9 million in restricted cash.

Historically, the Company has incurred losses, which have resulted in an accumulated deficit of approximately $181.6 million as of March 31, 2026.

Cash flows used in operating activities were $196,000 and $350,000 for the three months ended March 31, 2026 and 2025, respectively.

As of March 31, 2026, the Company had a working capital deficit of approximately $96.2 million inclusive of $594,000 in cash and cash equivalents and $1.9 million in restricted cash.

The Company's current cash and working capital, as of the filing of this Quarterly Report on Form 10-Q, are not expected to be sufficient to fund its anticipated level of operations over the next twelve months.

11 unchanged sentences

The Credit Agreement has been amended numerous times to change the terms, including the amounts outstanding, the interest rate, the maturity date and other payment terms.

As of September 30, 2025, Centre Lane Partners has loaned the Company $39.9 million through Amendments One through Eight (the "Second Out Loans"), Amendments Nine through Sixteen (the "First Out Loans"), and Amendments Seventeen and Twenty-One (the "Third Out Loans").

As of March 31, 2026, in addition to the acquisition financing provided to the Company effective June 1, 2020, Centre Lane Partners had loaned the Company an additional $39.9 million through Amendments One through Eight (the “Second Out Loans”), Amendments Nine through Sixteen and Nineteen (the “First Out Loans”), and Amendments Seventeen and Twenty-One (the “Third Out Loans”) to provide liquidity to fund operations.

Effective March 31, 2025, the Company, the Lenders, and Centre Lane Partners entered into the Twenty-Second Amendment to the Credit Agreement, pursuant to which the following adjustments were made to the outstanding loans:

5 unchanged sentences

• Adjusting the amortization of the First Out Loans such that an installment of $700,000 was paid on March 31, 2025, and quarterly installments of $575,000 are paid thereafter until maturity.

Effective September 30, 2025, the Company, the Lenders, and Centre Lane Partners entered into the Twenty-Third Amendment to the Credit Agreement, which applied the following adjustments to loans with outstanding payments due on September 30, 2025, including the following temporary modifications:

• Converting the First Out Loans cash interest due on September 30, 2025, to interest PIK;

• Reducing the First Out Loans amortization payment from $575,000 to $250,000 due on September 30, 2025, with the difference deferred to the maturity date of the First Out Loans, which is December 20, 2026;

• Incurring an amendment fee equal to 25 basis points of the First Out Loans, approximately $8,000, which was added to the principal balance as of September 30, 2025;

• Incurring an amendment fee equal to 25 basis points of the First Out Loans, approximately $8,000, which was added to the principal balance of the First Out Loans as of September 30, 2025;

• Converting the Second Out Loans cash interest due on September 30, 2025, to interest PIK;

• Deferring the Second Out Loans amortization payment due on September 30, 2025, to the maturity date of the Second Out Loans, which is December 20, 2026;

• Following the payments made on September 30, 2025, all loan terms, including cash interest and PIK rates, will revert to the terms established under the Twenty-Second Amendment.

The outstanding principal owed to Centre Lane Partners was $83.6 million and $78.8 million as of September 30, 2025 and December 31, 2024, respectively.

Of the amount outstanding at September 30, 2025, approximately $5.1 million is due by September 30, 2026, with $975,000 due at December 31, 2025, and $1.4 million due at each of March 31, June 30, and September 30, 2026.

The balance of $78.5 million is due in December 2026.

• Following payments made on September 30, 2025, all loan terms, including cash interest and PIK rates, reverted to the terms established under the Twenty-Second Amendment.

Quarterly amortization payments resumed and were due on December 31, 2025.

Effective December 31, 2025, the Company, the Lenders, and Centre Lane Partners entered into the Twenty-Fourth Amendment to the Credit Agreement, which applied the following adjustments to loans with outstanding payments due on December 31, 2025, including the following modifications:

• Converting the Second Out Loans cash interest due on December 31, 2025, to interest PIK;

• Deferring the Second Out Loans amortization payment due on December 31, 2025, to March 31, 2026.

• Following payments made on December 31, 2025, all loan terms, including cash interest rates, reverted to the terms established under the Twenty-Second Amendment.

Quarterly amortization payments resumed and were due on March 31, 2026.

Effective March 31, 2026, the Company, the Lenders, and Centre Lane Partners entered into the Twenty-Fifth Amendment to the Credit Agreement, which applied the following adjustments to loans with outstanding payments due on March 31, 2026, including the following modifications:

• Converting the Second Out Loans cash interest due on March 31, 2026, to interest PIK;

• Deferring the Second Out Loans amortization payment due on March 31, 2026, to the maturity date of the Second Out Loans, which is December 20, 2026.

• Following payments made on March 31, 2026, all loan terms, including cash interest rates, were reverted to the terms established under the Twenty-Second Amendment.

Quarterly amortization payments resumed and are due on June 30, 2026.

As of March 31, 2026, we owed Centre Lane $88.2 million under the Centre Lane Senior Secured Credit Facility.

Of this amount, $1.4 million is due on June 30, 2026, $1.4 million is due on September 30, 2026, and the remaining principal balance of $85.4 million is due on December 31, 2026.

For a full description of the Centre Lane Senior Secured Credit Facility, see Note 10, Centre Lane Senior Secured Credit Facility, to the consolidated financial statements.

Summary of Cash Flows

The following table summarizes cash flow activities during the nine months ended September 30, 2025 and 2024:

Nine Months Ended September 30,

The following table summarizes cash flow activities during the three months ended March 31, 2026 and 2025:

Three Months Ended March 31,

(in thousands)

Cash flow provided by (used in) operating activities

Cash flow used in investing activities

Cash flow used in financing activities

Net cash used in operating activities

Net cash used in investing activities

Net cash used in financing activities

Net decrease in cash and cash equivalents, net of impact of exchange rates

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Our primary uses of our operating cash, are for cost of revenue expenses, personnel-related expenditures and other general administrative expenses.

For the nine months ended September 30, 2025, cash provided by operating activities was $347,000 The primary factors affecting our operating cash flows during the period were our net loss of $10.1 million, adjusted for non-cash charges of $1.4 million for amortization of intangible assets, $1.7 million of amortization of debt discount, $7.0 million in interest paid in kind on the Centre Lane Senior Secured Credit Facility, and a $4,000 net change in operating assets and liabilities.

The primary drivers of the changes in operating assets and liabilities were a $2.4 million increase in deferred revenue and a $706,000 decrease in accounts receivable, partially offset by a $1.6 million decrease in accounts payable and accrued expenses and a $1.5 million decrease in other liabilities.

For the nine months ended September 30, 2024, cash used in operating activities was $451,000.

The primary factors affecting our operating cash flows during the period were our net loss of $13.2 million, adjusted for non-cash charges of $1.4 million for amortization of intangible assets, $2.2 million of amortization of debt discount, $6.9 million in interest paid in kind on the Centre Lane Senior Secured Credit Facility, $191,000 for stock compensation expense, and a $1.8 million net change in operating assets and liabilities.

The primary drivers of the changes in operating assets and liabilities were a $2.3 million increase in accounts receivable, a $543,000 decrease in accounts payable, and a $363,000 decrease in other liabilities, partially offset by a $200,000 increase in deferred revenue.

For the three months ended March 31, 2026, cash used in operating activities was $0.2 million.

The primary factors affecting our operating cash flows during the period were our net loss of $1.3 million, adjusted for non-cash charges of $445,000 for amortization of intangible assets, $460,000 of amortization of debt discount, $2.6 million in interest paid-in-kind on the Centre Lane Senior Secured Credit Facility, and a $2.5 million net change in operating assets and liabilities.

The primary drivers of the changes in operating assets and liabilities were a $4.5 million decrease in accounts payable and accrued expenses and a $665,000 decrease in other liabilities, partially offset by a $1.6 million increase in deferred revenue and a $839,000 decrease in accounts receivable.

For the three months ended March 31, 2025, cash used in operating activities was $350,000.

The primary factors affecting our operating cash flows during the period were our net loss of $3.2 million, adjusted for non-cash charges of $485,000 for amortization of intangible assets, $633,000 of amortization of debt discount, $2.3 million in interest paid in kind on the Centre Lane Senior Secured Credit Facility, and a $585,000 net change in operating assets and liabilities.

The primary drivers of the changes in operating assets and liabilities were a $3.9 million decrease in accounts payable and a $543,000 decrease in other liabilities, partially offset by a $3.5 million increase in deferred revenue and a $762,000 decrease in accounts receivable.

Investing Activities

Cash used in investing activities of $30,000 and $100,000 for the nine months ended September 30, 2025 and 2024, respectively, was attributable to $30,000 and $14,000, respectively, for the purchase of property and equipment, and $86,000 for website enhancements during the nine months ended September 30, 2024.

For the three months ended March 31, 2026, cash used in investing activities was $0.

For the three months ended March 31, 2025, cash used in investing activities was $10,000, attributable to the purchase of property and equipment.

Financing Activities

During the nine months ended September 30, 2025, the Company used cash of $2.3 million in financing activities, which is largely attributable to the repayment of principal on the Centre Lane Senior Secured Credit Facility of $2.3 million.

During the nine months ended September 30, 2024, the Company used cash of $971,000 in financing activities, which is largely attributable to repayment of principal on the Centre Lane Senior Secured Credit Facility of $879,000.

For the three months ended March 31, 2026, cash used in financing activities was $581,000, which was primarily attributable to repayments of principal on the Centre Lane Senior Secured Credit Facility.

For the three months ended March 31, 2025, cash used in financing activities was $4,000, which was primarily attributable to principal payments on finance lease obligations.

Contractual Obligations and Commitments

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Off-Balance Sheet Arrangements

As of September 30, 2025 and December 31, 2024, there were no off-balance sheet arrangements between us and any other entity that have, or are reasonably likely to have, a current or future effect on our financial condition, changes in financial condition, revenue or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to shareholders.

As of March 31, 2026 and December 31, 2025, there were no off-balance sheet arrangements between us and any other entity that have, or are reasonably likely to have, a current or future effect on our financial condition, changes in financial condition, revenue or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to shareholders.

Critical Accounting Policies and Estimates

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis