What changed in this filing

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Item 1. Financial Statements

2026-05-13 compared with 2025-11-14 · 225 added, 365 removed, 567 unchanged (51% of the section changed)

2 unchanged sentences

(Amounts in thousands, except share and per share data)

September 30, 2025

March 31, 2026

December 31, 2025

4 unchanged sentences

Prepaid expenses and other current assets

Current restricted cash

Total current assets

13 unchanged sentences

Deferred revenue

Current portion of long-term debt

Short-term debt, net

23,456 30,846

2 unchanged sentences

52,210 65,034

Long-term debt, net

Convertible Notes, at fair value with related parties

23 unchanged sentences

(Amounts in thousands, except share and per share data)

Three Months Ended September 30,

Nine Months Ended September 30,

Three Months Ended March 31,

Costs and expenses:

4 unchanged sentences

Depreciation and amortization

Goodwill and intangible assets impairment

Loss on disposal of assets

Total costs and expenses

2 unchanged sentences

Fair value adjustment of Convertible Notes with related parties

Loss on early extinguishment of debt

Loss before income taxes

Income tax benefit (expense)

Income tax expense

Basic and diluted loss per share:

6 unchanged sentences

Total shareholders'

Balance at June 30, 2025

Vesting of restricted stock units and issuance of stock under incentive plans

Share-based compensation

Issuance of common stock, pre-funded warrants and common stock warrants

Exercise of pre-funded warrants

Balance at September 30, 2025

Balance at December 31, 2025

Vesting of restricted stock units and issuance of stock under incentive plans

Share-based compensation expense

Issuance of common stock, pre-funded warrants and common stock warrants

Share-based compensation

Exercise of pre-funded warrants

Balance at September 30, 2025

Balance at March 31, 2026

Treasury stock

1 unchanged sentence

Total shareholders'

Balance at June 30, 2024

Vesting of restricted stock units and issuance of stock under incentive plans

Share-based compensation

Issuance of pre-funded warrants

Exercise of pre-funded warrants

Balance at September 30, 2024

Balance at December 31, 2024

Vesting of restricted stock units and issuance of stock under incentive plans

Share-based compensation expense

Share-based compensation

Issuance of pre-funded warrants

Exercise of pre-funded warrants

Balance at September 30, 2024

Balance at March 31, 2025

See notes to consolidated financial statements

1 unchanged sentence

(Amounts in thousands)

Nine Months Ended September 30,

Three Months Ended March 31,

CASH FLOWS FROM OPERATING ACTIVITIES:

Adjustments to reconcile net loss to net cash used in operating activities:

Adjustments to reconcile net loss to net cash provided by operating activities:

Depreciation and amortization

Non-cash loan amortization expense

Non-cash gain on contingent consideration

Non-cash loss on early extinguishment of debt

Non-cash gain on divestiture

Share-based compensation expense

Fair value adjustment of Convertible Notes with related parties

Goodwill impairment

Impairment of intangible assets

Non-cash loss on asset write-off

Loss on disposal of asset

Allowance for credit losses

7 unchanged sentences

Deferred revenue

Net cash used in operating activities

Net cash provided by operating activities

CASH FLOWS FROM INVESTING ACTIVITIES:

Capitalized costs included in intangible assets

Proceeds from note receivable

Acquisition of property and equipment

1 unchanged sentence

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from issuance of long-term debt, net of debt financing costs

Repayments of long-term debt

Proceeds from issuance of short and long-term debt

Repayments of short and long-term debt

Debt financing costs

Proceeds from issuance of common stock and warrants

Equity financing costs

Proceeds from exercise of warrants

Proceeds from Convertible Notes, with related parties

Net cash provided by financing activities

Net cash used in financing activities

Net decrease in cash, cash equivalents, and restricted cash

3 unchanged sentences

Cash paid for interest

Cash (refunded) paid for income taxes

Cash refunded for income taxes

Share-based compensation capitalized in intangible assets

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES

Long-term debt issuance

Consideration for True North

Note receivable issuance for Call Solutions divestiture

See notes to consolidated financial statements

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Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to those rules and regulations.

The accompanying unaudited consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the financial position, results of operations, and cash flows for the interim periods ended September 30, 2025 and 2024 , but are not necessarily indicative of the results of operations to be anticipated for any future interim periods or for the full year ending December 31, 2025 .

The accompanying unaudited consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the financial position, results of operations, and cash flows for the interim periods ended March 31, 2026 and 2025 , but are not necessarily indicative of the results of operations to be anticipated for any future interim periods or for the full year ending December 31, 2026 .

From time to time, the Company may enter into relationships or investments with other entities, and, in certain instances, the entity in which the Company has a relationship or investment may qualify as a variable interest entity ("VIE").

1 unchanged sentence

The primary beneficiary is the party that has the power to direct activities that most significantly impact the operations of the VIE and has the obligation to absorb losses or the right to benefits from the VIE that could potentially be significant to the VIE.

The information included in this Quarterly Report on Form 10 -Q should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company's Annual Report on Form 10 -K for the year ended December 31, 2024 (" 2024 Form 10 -K") filed with the SEC on March 31, 2025 .

The information included in this Quarterly Report on Form 10 -Q should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company's Annual Report on Form 10 -K for the year ended December 31, 2025 filed with the SEC on March 31, 2026 , as amended April 30, 2026 ( as amended, "2025 Form 10 -K").

The consolidated balance sheet as of December 31, 2025 included herein was derived from the audited financial statements as of that date and included in the 2025 Form 10 -K.

Reclassification

To conform with the current year presentation, certain prior year amounts related to equity financing costs have been reclassified and separately presented from proceeds from issuance of common stock and warrants on the consolidated statements of cash flow.

Going concern

1 unchanged sentence

As part of this evaluation, management may consider the potential mitigating impact of its plans that have not been fully implemented as of the issuance date if (a) it is probable that management's plans will be effectively implemented on a timely basis, and (b) it is probable that the plans, when implemented, will alleviate the relevant conditions or events that raise substantial doubt about the Company's ability to continue as a going concern within one year after the issuance date.

The Company has experienced declining revenue and profitability in the last several years, in large part due to difficulties sourcing traffic for the Company's owned and operated digital media properties ("O&O Sites").

In 2023, the FTC Consent Order (as defined in Note 10 , Contingencies ) imposed more rigorous standards and vetting of the Company's third-party publishers, some of whom elected not to work with the Company, which negatively impacted the Company's registration volume on its O&O Sites (see Note 10 , Contingencies ).

Moreover, borrowings under the SLR Revolver (as defined in Note 4 , Long-term debt, net ) pursuant to the SLR Credit Agreement (as defined and discussed in Note 4 , Long-term debt, net ) are limited to a borrowing base, that fluctuates weekly, based on eligible accounts receivable.

As a result of the borrowing base limit and the above performance issues, the available borrowing capacity has the potential to be insufficient to fund operations and meet the Company's needs.

Given the continued challenges the Company has faced achieving profitability, the Company has made reductions in workforce, including during the first quarter of 2025, and restructured certain long-term contracts to better align with the Company’s results and cash flow requirements.

The Company will continue to monitor the performance of its business units to determine the impact of potential divestments and consider further cost reduction measures and reallocation of resources that will enable the Company to meet its projected budget and cash flow requirements.

As of September 30, 2025, the Company was in compliance with its financial covenants under the SLR Credit Agreement (as defined below in Note 4 , Long-term debt, net ).

Although the financial covenants under the SLR Credit Agreement were reset in the third quarter of 2025 based on the Company’s twelve month projections, the Company has not met its projection for certain recent quarters, and if during any future quarter, the Company does not comply with any of its financial covenants, such non-compliance would result in default and therefore give SLR the right to accelerate maturities.

In such case, the Company would not have sufficient funds to repay the borrowings under the SLR Credit Agreement.

As a result of the foregoing, management has concluded that there is substantial doubt about the Company's ability to continue as a going concern for one year after the date of issuance of this Quarterly Report on Form 10 -Q.

With the continuing difficulties in sourcing traffic for the owned and operated digital media properties ("O&O Sites"), the Company has shifted its strategic focus toward scaling its Commerce Media Solutions business.

While Commerce Media Solutions has demonstrated growth and operates under a different economic model that reduces exposure to certain media sourcing risks, it represents a relatively new and evolving component of the Company’s business.

Further, the success of the Commerce Media Solutions transition depends on the Company’s ability to continue to onboard and retain media partners, achieve favorable economics under long-term agreements, and maintain advertiser demand, and there can be no assurance that this strategy will be successful.

Since entering into the Financing Agreement (as defined in and discussed in Note 4, Debt, net ), the Company has continued to receive advances, as needed, on its eligible account receivables.

However, the facility remains uncommitted, with the advances typically due within 120 -days, leading to its classification as short-term.

Although Bay View (as defined in Note 4, Debt, net ) has indicated in writing its intention, absent an event of default, to continue purchasing eligible receivables in the ordinary course, and has made advances since the facility was entered into, such funding remains subject to the discretion of Bay View and the terms and conditions of the Financing Agreement.

If availability under the facility were reduced or if Bay View were to cease advances, the Company could have insufficient funds to support its operations and meet its obligations as they come due unless it found another lender or purchaser of its receivables.

Based upon the foregoing, management has concluded that there is substantial doubt about the Company's ability to continue as a going concern.

Based on the Company's forecast, management expects to have sufficient liquidity over the next twelve months from the date of filing.

However, the Company does have a history of not meeting its forecast and any substantial deviations from such forecasts could adversely affect the Company’s liquidity and ability to access funding.

In addition, the Company completed its procedures as it relates to the At-The-Market Issuance Sales Agreement (the “ATM Agreement”), which will allow the Company to offer and sell up to $ 11,200 shares of common stock.

The Company's ability to raise capital under this program, or through other financing sources, is subject to market conditions and other factors and may be limited or unavailable at acceptable terms, if at all.

Although management believes its current plans will be sufficient and that the Company will maintain access to the Bay View facility, there is no guarantee such plans will be successful or have the expected benefit.

As such, management has concluded that there is substantial doubt about the Company's ability to continue as a going concern for one year after the date of issuance of this Quarterly Report on Form 10 -Q.

The accompanying consolidated financial statements do not include any adjustments relating to the possible future effects on the recoverability and classification of recorded assets and classification of liabilities that might result should the Company be unable to continue as a going concern.

14 unchanged sentences

The Company is currently evaluating the impact of adopting the ASU on its consolidated financial statements and disclosures.

In December 2023, the FASB issued ASU No.

2023 - 09, Income Taxes (Topic 470 ):

Improvements to Income Tax Disclosures , designed to increase the transparency and usefulness of income tax disclosures for financial statement users.

The ASU follows investors' indication and request for enhanced tax disclosures in order to better assess an entity’s operations, related tax risks, jurisdictional tax exposures, and increase transparency regarding tax information through improvements to tax disclosures, specifically rate reconciliation, income taxes paid, and unrecognized tax benefits and certain temporary differences.

The new guidance is effective for fiscal years beginning after December 15, 2024 and interim periods within fiscal years beginning after December 15, 2025, and early adoption is permitted.

The guidance will be applied on a prospective basis, but retrospective application is permitted.

The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements and disclosures.

In November 2024, the FASB issued ASU No.

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The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements and disclosures.

In November 2024, the FASB issued ASU No.

2024 - 04, Debt with Conversion and Other Options (Subtopic 470 - 20 ):

Induced Conversions of Convertible Debt Instruments which is intended to clarify requirements for determining whether certain settlements of convertible debt instruments, including convertible debt instruments with cash conversion features or convertible debt instruments that are not currently convertible, should be accounted for as an induced conversion.

The new guidance is effective for fiscal years beginning after December 15, 2025, and interim periods within those fiscal periods, and early adoption is permitted.

The guidance will be applied on a prospective basis to financial statements issued for reporting periods after the effective date, or retrospectively to any and all prior periods presented in the financial statements.

The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements and disclosures.

In July 2025, the FASB issued ASU No.

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The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements and disclosures.

In December 2025, the FASB issued ASU 2025 - 11, Interim Reporting (Topic 270 ):

Narrow-Scope Improvements , which clarifies the guidance in Topic 270 to improve the consistency of interim financial reporting.

The ASU provides a comprehensive list of required interim disclosures and introduces a disclosure principle requiring entities to disclose events from the end of the last annual reporting period that have a material impact on the entity.

The guidance is effective for fiscal years beginning after December 15, 2027, including interim periods within those fiscal years, with early adoption permitted.

The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements and disclosures.

In December 2025, the FASB issued ASU 2025 - 12, Codification Improvements, which makes improvements to the ASC for a broad range of Topics arising from technical corrections, unintended application of the Codification, clarifications, and other minor improvements.

This update is effective for annual reporting periods beginning after December 15, 2026, including interim reporting periods within those annual reporting periods.

The Company is currently evaluating the impact of adopting this standard on its consolidated financial statements.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

4 unchanged sentences

Revenue is recognized when a company has satisfied its performance obligations to a customer and can reasonably expect and measure the payment.

The Company's performance obligations are typically to (a) deliver data records based on predefined qualifying characteristics specified by the customer, (b) generate conversions based on predefined user actions (for example, a click, a registration, or the installation of an app) and subject to certain qualifying characteristics specified by the customer, (c) transfer calls with the Company's advertiser clients as a part of the call center operation, or (d) deliver media spend as a part of the business of AdParlor, LLC ("AdParlor"), a wholly-owned subsidiary of the Company.

The Company's performance obligations are typically to (a) deliver data records based on predefined qualifying characteristics specified by the customer, (b) generate conversions based on predefined user actions (for example, a click, a registration, or the installation of an app) and subject to certain qualifying characteristics specified by the customer, (c) deliver media spend as a part of the business of AdParlor, LLC ("AdParlor"), a wholly-owned subsidiary of the Company, or previously, through January 31, 2026, and (d) transfer calls with the Company's advertiser clients as a part of the call center operation.

These Company performance obligations have the customer simultaneously receiving and consuming the benefits provided.

3 unchanged sentences

The Company's revenue arrangements do not contain significant financing components.

As of March 31, 2026, December 31, 2025 and 2024, the balance of accounts receivable was $ 20,041 , $ 28,499 , and $ 26,131 , respectively.

For each identified performance obligation in a contract with a customer, the Company assesses whether it or the third -party supplier is the principal or agent.

4 unchanged sentences

If a customer pays consideration before the Company's performance obligations are satisfied, such amounts are classified as deferred revenue on the consolidated balance sheets.

September 30, 2025 ,

March 31, 2026 ,

December 31, 2025 , and

5 unchanged sentences

When there is a delay between the period in which revenue is recognized and when a customer invoice is issued, revenue is recognized, and the corresponding amounts are recorded as unbilled revenue within accounts receivable on the consolidated balance sheets.

As of September 30, 2025 , December 31, 2024 , and December 31, 2023, unbilled revenue included in the Company's accounts receivable was $ 11,762 , $ 18,625 , and $ 21,488 , respectively.

As of March 31, 2026 , December 31, 2025 , and December 31, 2024, unbilled revenue included in the Company's accounts receivable was $ 11,292 , $ 17,701 , and $ 18,625 , respectively.

In line with industry practice, the unbilled revenue balance is recorded based on the Company's internally tracked conversions, net of estimated variances between this amount and the amount tracked and subsequently confirmed by customers.

6 unchanged sentences

In addition, the Company elected the practical expedient to not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which revenue is recognized at the amount to which the Company has the right to invoice for services performed.

Commission revenue

The Company, acting as the agent, recognizes commission revenue that it expects to receive from an insurance provider from the sale of certain of its health insurance policies, which includes the assumed automatic renewals of such policies once its performance obligation is satisfied.

The Company considers its performance obligation related to commissions for both the initial policy sale and future renewals of the policy to be satisfied upon submission by the Company of the initial policy application.

The Company applies the practical expedient to estimate the commission revenue for each insurance policy by applying the use of the portfolio approach to policies grouped together by product type and period submitted for effectuation.

The commission revenue is variable based on a policy's estimated lifetime value ("LTV"), which is the amount of time the Company expects the policy will remain effective based on past trends, industry data, expectations as to future retention rates, and commission rates, based on the expected value method.

Further, the Company considers the application of constraints to the LTV and only recognizes the amount of variable consideration believed probable to be received that will not be subject to a significant revenue reversal in the future.

Based on this, the commission revenue is recorded upon satisfaction of the performance obligation, with the associated payment, typically paid monthly, over time, by the insurance provider as the consumer renews and pays the insurance provider for the policy over the duration the consumer remains on the policy.

The Company reassesses the estimated LTV for the health insurance policies on a quarterly or as-needed basis.

Adjustments to the LTV may result in an increase or decrease in revenue and the corresponding asset in the period the change is made.

As of September 30, 2025, the Company had receivables of $ 925 related to commission revenue.

Revenue Disaggregation

The following table presents the Company’s disaggregated revenue by media resources along with its availability and demand for the three and nine months ended September 30, 2025 and 2024 , based on segment reporting:

Three Months Ended September 30,

(In thousands)

Owned and Operated

$ 20,744 $ — $ 20,744 $ 43,540 $ — $ 43,540

Commerce Media Solutions

18,808 — 18,808 10,363 — 10,363

Call Solutions

5,283 — 5,283 7,574 — 7,574

— 2,183 2,183 — 2,382 2,382

All Other (1)

— 11 11 — 657 657

Total Revenue

$ 44,835 $ 2,194 $ 47,029 $ 61,477 $ 3,039 $ 64,516

Balance is fully related for the three months ended September 30, 2025 and partially related for the three months ended September 30, 2024 to commission revenues.

Nine Months Ended September 30,

The following table presents the Company’s disaggregated revenue by media resources along with its availability and demand for the three months ended March 31, 2026 and 2025 , based on segment reporting:

Three Months Ended March 31,

(In thousands)

10 unchanged sentences

$ 42,825 $ 2,027 $ 44,852 $ 53,821 $ 1,389 $ 55,210

Balance is fully related for the nine months ended September 30, 2025 and partially related for the nine months ended September 30, 2024 to commission revenues.

The Owned and Operated and Commerce Media Solutions in the table above represent the Company’s data and performance-based marketing revenue.

Call Solutions mainly represents the Company’s performance-based marketing revenue.

Our performance is subject to fluctuations related to seasonality and cyclicality in our clients' businesses and in media sources.

Other factors affecting our business may include macroeconomic conditions that impact the digital advertising industry, the various client verticals we serve, and general market conditions.

No balance for the three months ended March 31, 2026 .

Balance is fully related for the three months ended March 31, 2025 to commission revenues in run-off.

Owned and Operated and Commerce Media Solutions in the table above represent the Company’s remaining data and performance-based marketing revenue.

Prior to its divestiture, Call Solutions also consisted of performance-based marketing revenue (refer to Note 12, Divestiture for details).

The Company's performance is subject to fluctuations related to seasonality and cyclicality in our clients' businesses and in media sources.

Other factors affecting the Company may include macroeconomic conditions that impact the digital advertising industry, the various client and partner verticals served, and general market conditions.

(d) Use of estimates

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GAAP requires the Company’s management to make estimates and assumptions relating to the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting periods.

Significant items subject to such estimates and assumptions include the allowance for credit losses, useful lives of intangible assets, recoverability of the carrying amounts of intangible assets, the portion of revenue subject to estimates for variances between internally-tracked conversions and those confirmed by the customer, the variable commission revenue based on the estimated LTV, consolidation of VIE, fair value of Convertible Notes (as defined in Note 4 , Long-term debt, net ) with related parties based on input assumptions, share-based compensation and income tax provision.

Significant items subject to such estimates and assumptions include the allowance for credit losses, useful lives of intangible assets, recoverability of the carrying amounts of intangible assets, the portion of revenue subject to estimates for variances between internally-tracked conversions and those confirmed by the customer, consolidation of VIE, fair value of Convertible Notes (as defined in Note 4 , Debt, net ) with related parties based on input assumptions, share-based compensation and income tax provision.

These estimates are often based on complex judgments and assumptions that management believes to be reasonable but are inherently uncertain and unpredictable.

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Goodwill represents the difference between the purchase price and the estimated fair value of net assets acquired when accounted for by the acquisition method of accounting.

September 30, 2025 and

March 31, 2026 and

December 31, 2025 , there was

no remaining goodwill.

(g) Common stock warrants

The Company accounts for warrants as either equity-classified or liability-classified instruments in accordance with the guidance provided in ASC 480, Distinguishing Liabilities from Equity , and ASC 815, Derivatives and Hedging .

Equity-classified warrants are those that are indexed to the Company’s own stock and meet the criteria for equity classification under ASC 815 - 40.

These instruments are recorded in equity at fair value on the issuance date and are not subsequently remeasured, provided the Company continues to meet the equity classification criteria.

Income (loss) per share

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Stock equivalent shares are excluded from the calculation in loss periods, as their effects would be anti-dilutive.

For the three and nine months ended September 30, 2025 and 2024 , basic and diluted loss per share were as follows:

Three Months Ended September 30,

Nine Months Ended September 30,

For the three months ended March 31, 2026 and 2025 , basic and diluted loss per share were as follows:

Three Months Ended March 31,

$ ( 5,354 ) $ ( 8,269 )

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$ ( 0.17 ) $ ( 0.39 )

Based on exercise prices compared to the average stock prices for the three and nine months ended September 30, 2025 and 2024 , certain stock equivalents have been excluded from the diluted weighted average share calculations due to their anti-dilutive nature.

Three Months Ended September 30,

Nine Months Ended September 30,

Based on exercise prices compared to the average stock prices for the three months ended March 31, 2026 and 2025 , certain stock equivalents have been excluded from the diluted weighted average share calculations due to their anti-dilutive nature.

Three Months Ended March 31,

Restricted stock units

3 unchanged sentences

Common stock warrants

7,701,383 — 7,701,383 —

Total anti-dilutive securities

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Intangible assets, net, other than goodwill, consist of the following:

Amortization period (in years) September 30, 2025

Amortization period (in years) March 31, 2026

December 31, 2025

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Software developed for internal use

Acquired proprietary technology

Customer relationships

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The gross amounts associated with software developed for internal use primarily represent capitalized costs of internally developed software.

The amounts relating to acquired proprietary technology, customer relationships, trade names, domain names, and databases primarily represent the fair values of intangible assets acquired as a result of the acquisition of Fluent, LLC, effective December 8, 2015;

The amounts relating to customer relationships, trade names, and domain names primarily represented the fair values of intangible assets acquired as a result of the acquisition of Fluent, LLC, effective December 8, 2015;

the acquisition of Q Interactive, LLC, effective June 8, 2016;

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and certain of its affiliates, effective July 1, 2019;

the acquisition of a 50 % interest in Winopoly, LLC, effective April 1, 2020;

and the initial consolidation of TAPP Influencers Corp.

("TAPP"), effective January 9, 2023 .

On May 20, 2025, the Company entered into an updated agreement with the key employee of TAPP, terminating all prior agreements.

As a result, the Company determined that it was no longer the primary beneficiary, and under ASC 810, TAPP was no longer being consolidated under ASC 810.

and previously the acquisition of a 50 % interest in Winopoly, LLC, effective April 1, 2020 .

On January 31, 2026, the Company entered into a membership interest purchase agreement to divest its 100 % interest in Winopoly, LLC, and accordingly deconsolidated the entity under ASC 810 (see Note 12, Divestiture for details).

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts in thousands, except share and per share data)

The Company completed its quarterly triggering event assessment for the three months ended September 30, 2025 and determined that no triggering event had occurred requiring further impairment assessment of its long-lived assets.

Amortization expenses of $ 2,408 and $ 2,299 for the three months ended September 30, 2025 and 2024 , respectively, and $ 7,206 and $ 7,277 for the nine months ended September 30, 2025 and 2024 , respectively, are included in depreciation and amortization expenses in the consolidated statements of operations.

As of September 30, 2025 , intangible assets with a carrying amount of $ 673 , included in the gross amount of software developed for internal use, have not commenced amortization, as they are not ready for their intended use.

Further, during the nine months ended September 30, 2025 , the Company recognized a loss of $ 598 related to the write-off of the acquired proprietary technology in connection with TAPP ( see Note 11 , Variable interest entity).

As of September 30, 2025 , estimated amortization expenses related to the Company's intangible assets for the remainder of 2025 and through 2030 and thereafter are as follows:

September 30, 2025

The Company completed its quarterly triggering event assessment for the three months ended March 31, 2026 and determined that no triggering event had occurred requiring further impairment assessment of its long-lived assets.

Amortization expenses of $ 1,662 and $ 2,391 for the three months ended March 31, 2026 and 2025 , respectively, are included in depreciation and amortization expenses in the consolidated statements of operations.

As of March 31, 2026 , intangible assets with a carrying amount of $ 481 , included in the gross amount of software developed for internal use, have not commenced amortization, as they are not ready for their intended use.

As of March 31, 2026 , estimated amortization expenses related to the Company's intangible assets for the remainder of 2026 and through 2031 and thereafter are as follows:

March 31, 2026

Remainder of 2026

2031 and thereafter

Long-term debt, net

Long-term debt, net of unamortized discount and financing costs, related to the SLR Credit Facility (as defined herein), Note Payable (as defined herein), and Convertible Notes with related parties (as set forth herein) consisted of the following:

September 30, 2025

Debt, net of unamortized discount and financing costs, related to the Financing Agreement (as defined herein), Note Payable (as defined herein), and Convertible Notes with related parties (as defined herein) consisted of the following:

March 31, 2026

December 31, 2025

Credit Facility due 2029 (less unamortized discount and financing costs of $1,161 and $1,186, respectively)

Financing Agreement due 2028 (less unamortized discount and financing costs of $ 847 and $ 926 , respectively)

$ 23,206 $ 30,346

Note Payable due 2026

Convertible Notes with related parties

Long-term debt, net

Convertible Notes, at fair value with related parties

28,027 34,580

Current portion of long-term debt

Short term and current portion of long-term debt

( 23,456 ) ( 30,846 )

1 unchanged sentence

$ 4,571 $ 3,734

Accounts Receivable Finance Agreement

On November 25, 2025, the Company and its affiliates Fluent, LLC, Fluent Media Labs, LLC and AdParlor, LLC, each a wholly owned subsidiary of the Company, entered into an Accounts Receivable Finance Agreement (the "Financing Agreement") with CSNK Working Capital Finance Corp.

d/b/a Bay View Funding ("Bay View").

Under the Financing Agreement, Bay View may extend financing to the Company based on eligible domestic and foreign accounts receivable, provided that the aggregate amount of advances thereon shall not exceed the lesser of a maximum credit of $30,000 (the "Maximum Credit") or an amount equal to the sum of all advances less any funds received by Bay View pursuant to the Financing Agreement over the collection amounts adjusted for obligation that is maintained in a reserve account.

All collections of the financed receivables go directly to Bay View and are applied to the Company’s obligations under the Financing Agreement.

The transfer of the receivables was recorded as secured borrowings in accordance with ASC 860, Transfers and Servicing (“ASC 860” ), with the receivables remaining on the balance sheet as a current asset.

As of March 31, 2026 , the Financing Agreement had a balance of $ 24,053 , which was recorded within current liabilities as the underlying receivables are typically due within 120 -days and Bay View may require repayment of amounts outstanding beyond that period.

In addition, the Company had $ 506 in its reserve accounts with Bay View as of March 31, 2026 , which was recorded within prepaids and other current assets.

The net unused advance as of March 31, 2026 was $ 6,453 .

The Company used a portion of the net proceeds of the Financing Agreement to repay the outstanding SLR Credit Facility (as defined herein) under the SLR Credit Agreement (as defined herein) dated April 2, 2024.

The Financing Agreement has an initial term of 36 months (the "Initial Term") and renews automatically for additional 12 -month periods unless terminated in accordance with its terms.

The Company is required to pay a facility fee in the amount of 0.50 % of the Maximum Credit as of November 25, 2025 and then annually a 0.33 % of the Maximum Credit as well as a finance charge based on prime plus 2.0 % based on the average balance outstanding during the month.

In addition, the Company will be required to pay certain administrative fees.

The finance rate shall increase or decrease monthly but not be less than 8.75 % for the first year from the initial funding date, 8.50 % for the second year of the Initial Term and 8.25 % for the third year of the Initial Term.

As of March 31, 2026 , the annual finance charge rate was 11.75%, which includes the management fee of 3.0 % applied on the end of month average outstanding balance.

The total cost of the Financing Agreement for the three months ended March 31, 2026 was $ 604 , inclusive of the management fee, and was included in interest expense on the consolidated statements of operations under the effective interest method.

In addition, amortization of the debt discount for the three months ended March 31, 2026 was $ 79 , and was included in interest expense on the consolidated statements of operations.

The Company’s obligations under the Financing Agreement are secured by a security interest in substantially all of the Company’s assets.

The Financing Agreement contains customary representations, warranties, covenants and events of default, including repurchase obligations with respect to certain receivables.

Credit Facility

On April 2, 2024, Fluent, LLC, a wholly owned subsidiary of the Company (the "Borrower"), entered into a credit agreement (as amended, the "SLR Credit Agreement") with certain of its subsidiaries and the Company (collectively, the "Credit Parties"), as guarantors, and Crystal Financial LLC d/b/a SLR Credit Solutions, as administrative agent, lead arranger and bookrunner ("SLR"), and each other lender from time to time party thereto.

The SLR Credit Agreement provides for a $ 20,000 term loan (the "SLR Term Loan") and a revolving credit facility of up to $ 30,000 (the "SLR Revolver," and, together with the SLR Term Loan, the "SLR Credit Facility").

As of September 30, 2025 , the SLR Credit Facility had an outstanding principal balance of $ 22,576 (of which none relates to the SLR Revolver) and matures on April 2, 2029.

The Borrower used a portion of the net proceeds of the SLR Credit Facility to repay the outstanding $ 30,000 term loan due on September 30, 2025, under the credit agreement dated March 31, 2021, by and among the Borrower, certain subsidiaries of the Borrower as guarantors, the lenders thereto, and Citizens Bank, N.A.

The repayment resulted in a loss on early extinguishment of debt of $ 1,009 , which was recognized in the second quarter of 2024.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts in thousands, except share and per share data)

There is no principal amortization prior to maturity under the SLR Credit Agreement except for certain mandatory prepayments to be made with the net cash proceeds of certain asset sales, casualty events, and other extraordinary receipts and upon the occurrence of certain other events, in each case subject to certain reinvestment rights, thresholds and other exceptions.

Unfunded commitments will be subject to an unused facility fee, which will be payable monthly in arrears, as of the month following the closing, at a rate of 0.50 % per annum.

All amounts owed under the SLR Credit Facility are due and payable on the five -year anniversary of the closing date or earlier following a change in control or an event of default, unless otherwise extended in accordance with the terms of the SLR Credit Agreement.

Borrowings under the SLR Credit Agreement bear interest at a rate per annum equal to a 3 -month term SOFR plus 0.26161 %, subject to a 1.50 % floor, plus a margin (the "Applicable Margin") of 5.25 % which was increased to 5.75 % pursuant to the Second Amendment to the SLR Credit Agreement (the "Second Amend ment").

The Applicable Margin will be reduced to 5.0 % when the Borrower's fixed charge coverage ratio is greater than 1.10 to 1.

The opening interest rate of the SLR Credit Facility was 10.81 % (SOFR + CSA + 5.25 %), which changed to 10.18 % (SOFR + CSA + 5.75 %) as of September 30, 2025 .

The SLR Credit Agreement contains restrictive covenants that impose limitations on the way the Credit Parties conduct business, including limitations on the amount of additional debt the Credit Parties are able to incur and their ability to make certain investments or other restricted payments.

The SLR Credit Agreement is guaranteed by the Company and certain of its direct and indirect subsidiaries and is secured by substantially all of the Company's assets and those of its direct and indirect subsidiaries, including the Borrower.

The Borrower's ability to draw on the SLR Revolver depends on its borrowing base, which is calculated weekly by applying specified percentages established by SLR to the Borrower's eligible accounts receivable and cash, less reserves, subject to certain limitations.

When the borrowing base does not support amounts exceeding our $ 20,000 SLR Term Loan, the Borrower is required to maintain a restricted cash balance with the lender.

Debt issuance costs and debt discount costs, net of accumulated amortization, related to the issuance and amendments of the SLR Revolver were $ 703 and $ 1,038 , respectively, as of September 30, 2025 .

The amounts are included in other non-current assets in the Company's consolidated balance sheets.

The Company amortizes these costs over the life of the related debt.

On May 15, 2024, the Credit Parties and SLR entered into the First Amendment to the SLR Credit Agreement (the "First Amendment"), pursuant to which SLR, among other things, ( 1 ) waived any required prepayments on the SLR Revolver from the proceeds from the Company's private placement offering completed in May 2024 ( the "May 2024 Private Placement") (see Note 7 , Equity ), ( 2 ) required that the Credit Parties (as defined in the SLR Credit Agreement) retain a financial advisor to assist in preparing the Company's projections, ( 3 ) increased the minimum excess availability covenant following the May 2024 Private Placement, ( 4 ) amended the definition of borrowing base (as defined in the SLR Credit Agreement), and ( 5 ) amended certain post-closing obligations.

On August 19, 2024, the Credit Parties and SLR entered into the Second Amendment to the SLR Credit Agreement (the "Second Amendment"), which, among other things, required that the Company raise $ 2,000 in additional capital.

To raise the capital, the Company entered into convertible subordinated notes, as described below, raising an aggregate of $ 2,050 .

In addition, ( 1 ) SLR waived non-compliance with the financial covenants as of June 30, 2024, ( 2 ) modified the financial covenants through December 31, 2025, ( 3 ) ended a requirement to engage a financial advisor, ( 4 ) increased the Applicable Margin from 5.25 % to 5.75 %, and ( 5 ) waived any required prepayments from the proceeds from the convertible subordinated notes financing.

On November 14, 2024, the Credit Parties and SLR entered into the Third Amendment to the SLR Credit Agreement (the "Third Amendment"), which, among other things, required that the Company raise at least $ 7,500 of additional capital by November 29, 2024.

On November 27, 2024, the deadline was extended to December 3, 2024.

In addition, the Third Amendment ( 1 ) waived non-compliance with the financial covenants as of September 30, 2024, ( 2 ) extended the duration of the call protection applicable to the loans, and ( 3 ) modified the cash dominion provisions to remain in effect on an indefinite basis.

On March 10, 2025, the Credit Parties and SLR entered into the Fourth Amendment to the SLR Credit Agreement, (the "Fourth Amendment") which, among other things, required that the Company raise at least $ 5,000 of additional capital by March 20, 2025.

In addition, SLR ( 1 ) waived non-compliance with the financial covenants as of December 31, 2024, ( 2 ) extended the duration of the call protection applicable to the loans, and ( 3 ) modified the financial covenants through December 31, 2025.

On August 15, 2025, the Credit Parties and SLR entered into the Fifth Amendment to the SLR Credit Agreement, (the "Fifth Amendment") which, among other things, required that the Company raise at least $ 8,500 of additional capital by August 19, 2025.

In addition, SLR ( 1 ) waived non-compliance with the financial covenants as of June 30, 2025, and ( 2 ) modified the financial covenants for the periods through August 31, 2026.

As of September 30, 2025, the Company was in compliance with its financial covenants under the SLR Credit Agreement.

If, during any fiscal quarter, the Company does not comply with any of its financial covenants, such non-compliance would result in an event of default that would give SLR the right to accelerate maturities.

In such case, the Company would not have sufficient funds to repay the SLR Term Loan under the SLR Credit Agreement and any outstanding balance on the SLR Revolver.

As a result of the foregoing, all borrowings under the Credit Agreement have been classified as current as of September 30, 2025.

The SLR Credit Agreement provided for a $ 20,000 term loan (the "SLR Term Loan") and a revolving credit facility of up to $ 30,000 (the "SLR Revolver," and, together with the SLR Term Loan, the "SLR Credit Facility").

On November 25, 2025, the SLR Credit Facility had been repaid, prior to maturity, resulting in a debt extinguishment loss of approximately $ 3,759 , which included the $ 1,000 early termination fee.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

2 unchanged sentences

The Note Payable bears interest equal to one -month CME Term SOFR (defined as the rate published by the CME Group Benchmark Administration Limited) plus 11.0 % per annum, compounded quarterly.

The opening interest rate of the Note Payable was 16.32 % (SOFR + 11 %), which changed and was 15.32 % (SOFR + 11% ) as of September 30, 2025 .

The opening interest rate of the Note Payable was 16.32 % (SOFR + 11 %), which changed and was 14.68 % (SOFR + 11% ) as of March 31, 2026 .

A maximum of $ 1,000 of the borrowings under the Note Payable is secured by substantially all of the assets of Fluent, LLC.

This security interest is subordinate to the security interest under the SLR Credit Agreement.

The Note Payable matures on March 31, 2026 and interest is payable quarterly.

Scheduled principal amortization of the Note Payable is $ 250 per quarter, which commenced with the fiscal quarter ended June 30, 2024, but was subsequently paid upon receipt of the invoice from FDR and applied as of July 17, 2024.

This security interest is subordinate to the security interest under the Financing Agreement.

The Note Payable was to mature on March 31, 2026 and interest was payable quarterly.

Scheduled principal amortization of the Note Payable was $ 250 per quarter.

On April 8, 2026, the final payment was made on the Note Payable.

Convertible Notes with related parties

6 unchanged sentences

In connection with the Second Amendment and the Notes Purchase Agreement, the Company and SLR entered into a Second Amendment Subordination Agreement with each purchaser of the Convertible Notes on August 19, 2024 ( the "Subordination Agreements").

The Subordination Agreements confirm the subordinated nature of the Convertible Notes and restrict payments to and remedies of the holders of the Convertible Notes for so long as the SLR Credit Agreement has indebtedness outstanding.

The Subordination Agreements provide that the Company may not make any payment of principal or interest on the Convertible Notes unless certain conditions are met.

The Subordination Agreements confirmed the subordinated nature of the Convertible Notes and restricted payments to and remedies of the holders of the Convertible Notes for so long as the SLR Credit Agreement had indebtedness outstanding.

The Subordination Agreements provided that the Company may not make any payment of principal or interest on the Convertible Notes unless certain conditions are met.

In connection with the refinancing of the SLR Credit Agreement with Bay View the subordination obligations automatically carried over such that the Convertible Notes remain subordinated to the Company's obligations under the Bay View credit facility.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

10 unchanged sentences

As a result, based on ASC 825 - 10, the Company recorded a day one unrealized loss on the Convertible Notes of $ 2,110 .

As of September 30, 2025 , the principal balance of the Convertible Notes was $ 2,364 , with a fair value of $ 3,876 .

The Company recognized an additional increase in fair value of $ 554 and $ 156 for the three and nine months ended September 30, 2025 , respectively, which was recognized in other income (expense) from operations.

For the nine months ended September 30, 2025 , accrued interest was paid in kind.

As of September 30, 2025 , scheduled future maturities of the Company's debt are as follows, not reflective of the debt being accelerated as noted in Note 1 , Summary of significant accounting policies :

September 30, 2025

As of March 31, 2026 , the principal balance of the Convertible Notes was $ 2,519 , with a fair value of $ 4,571 .

The Company recognized an additional increase in fair value of $ 837 for the three months ended March 31, 2026 , which was recognized in other income (expense) from operations.

For the three months ended March 31, 2026 , accrued interest was paid in kind.

As of March 31, 2026 , scheduled future maturities of the Credit Agreement, including the required principal prepayment based on a portion of the Company's quarterly excess cash flow and excluding potential future additional principal prepayments, are as follows:

March 31, 2026

Remainder of 2026

4 unchanged sentences

The fair value of the Company's cash, cash equivalents, current restricted cash, accounts receivable, accounts payable, and accrued liabilities approximate their carrying values because of the short-term nature of these instruments.

Restricted cash

Restricted cash includes a separately maintained cash account, as required under the terms of a lease agreement the Company entered into on October 10, 2018 for office space in New York City.

1 unchanged sentence

The consent also approved the extension of the sublease term by four years, effective April 15, 2025.

In connection with this lease agreement, the Company recorded $ 710 in non-current restricted cash as of September 30, 2025 , and $ 1,255 in current restricted cash as of December 31, 2024 , on the consolidated balance sheets.

As of September 30, 2025 , the Company regards the fair value of its long-term debt to approximate its carrying value.

The following tables present the Company’s fair value hierarchy for assets and liabilities that are measured at fair value on a recurring basis as of September 30, 2025 and December 31, 2024 :

September 30, 2025

In connection with this lease agreement, the Company recorded $ 710 and $ 710 in non-current restricted cash as of March 31, 2026 and December 31, 2025, respectively, on the consolidated balance sheets.

As of March 31, 2026 , the Company regards the fair value of its Note (as defined in Note 12, Divestiture ) and debt to approximate its carrying value.

The following table presents the Company’s fair value hierarchy for assets and liabilities that are measured at fair value on a recurring basis as of March 31, 2026 and December 31, 2025 :

March 31, 2026

December 31, 2025

1 unchanged sentence

$ 710 — — $ 710 — —

Long-term debt, net (1)

— 2,931 — — — —

Debt, net (1)

— 24,303 — — 31,772 —

Convertible Notes with related parties

1 unchanged sentence

Contingent consideration in connection with TAPP (2)

— — 25 — — 988

Inclusive of the credit facilities and note payable.

The debt fair value does not include debt issuance costs or debt discount.

See Note 4 , Long-term debt, net.

See Note 4 , D ebt, net.

Balance recorded in accrued expenses and other current liabilities with changes to the balance as a result of adjustment of the fair value related to the initial discount rate and payments made.

1 unchanged sentence

The Company issued the Convertible Notes on August 19, 2024 and elected the fair value option.

See Note 4 , Long-term debt, net .

The following is a reconciliation of the fair value from December 31, 2024 to September 30, 2025 :

See Note 4 , Debt, net .

The following is a reconciliation of the fair value from December 31, 2025 to March 31, 2026 :

Fair value as of December 31, 2025

Loss on change in fair value reported in the consolidated statements of operations

Fair value as of September 30, 2025

Fair value as of March 31, 2026

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

2 unchanged sentences

Both approaches are based on the following assumptions:

September 30, 2025

March 31, 2026

Face value of principal payable

4 unchanged sentences

Contingent Consideration

In connection with the contingent consideration received related to the initial consolidation of TAPP, the Company had to determine the fair value of the identified assets acquired and liabilities assumed.

In connection with the contingent consideration received related to the initial consolidation of TAPP Influencers Corp.

("TAPP") effective January 9, 2023, the Company had to determine the fair value of the identified assets acquired and liabilities assumed.

The Company determined that the estimated fair value of the net assets acquired, excluding the net working capital, was a Level 3 measurement, as certain inputs to determine fair value were unobservable.

Fair value as of December 31, 2025

Adjustment to compensation expense

Payment of compensation expense

Fair value as of September 30, 2025

Fair value as of March 31, 2026

The fair value of certain long-lived non-financial assets and liabilities may be required to be measured on a nonrecurring basis in certain circumstances, including when there is evidence of impairment.

As of September 30, 2025 , certain non-financial assets have been measured at fair value subsequent to their initial recognition.

As of March 31, 2026 , certain non-financial assets have been measured at fair value subsequent to their initial recognition.

The Company determined the estimated fair value to be a Level 3 measurement, as certain inputs used to determine fair value are unobservable.

3 unchanged sentences

The Company updates its estimated AETR on a quarterly basis and, if the estimate changes, a cumulative adjustment is made.

As of September 30, 2025 and December 31, 2024 , the Company recorded a full valuation allowance against net deferred tax assets and intends to continue maintaining a full valuation allowance on these net deferred tax assets until there is sufficient evidence to support the release of all or a portion of these valuation allowances.

As of March 31, 2026 and December 31, 2025 , the Company recorded a full valuation allowance against U.S.

net deferred tax assets until there is sufficient evidence to support the release of all or a portion of these valuation allowances.

Release of some or all of the valuation allowance would result in the recognition of certain deferred tax assets and an increase in deferred tax benefit for any period in which such a release may be recorded;

however, the exact timing and amount of any valuation allowance release are subject to change depending upon the level of profitability that the Company is able to achieve and the net deferred tax assets available.

For the nine months ended September 30, 2025 , the Company's effective income tax rate of negative 0.5 % differed from the statutory federal income tax rate of 21 % primarily due to state and local tax expense and losses for which no tax benefit is recognized as such amounts are fully offset with a valuation allowance.

For the nine months ended September 30, 2024 , the Company's effective income tax rate of 0.4 % primarily represents state and local tax expense and losses for which no tax benefit was recognized.

For the three months ended March 31, 2026 , the Company's effective income tax rate of 0.0 % differed from the statutory federal income tax rate of 21 % primarily due to state and local tax expense and losses for which no tax benefit is recognized as such amounts are fully offset with a valuation allowance.

For the three months ended March 31, 2025 , the Company's effective income tax rate of 2.9 % primarily represented state and local tax expense and losses for which no tax benefit was recognized.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

3 unchanged sentences

For those income tax positions where it is not more-likely-than- not that a tax benefit will be sustained, no tax benefit has been recognized in the Company's financial statements.

On July 4, 2025, the One Big Beautiful Bill Act was enacted, introducing amendments to United States (“U.S.”) tax laws with various effective dates from 2025 to 2027.

The Company is currently assessing the implications of these tax law changes and does not expect a material impact on its financial statements in the current year.

Effective at 6:00 p.m.

Eastern Time on April 11, 2024, every six shares of common stock issued and outstanding or held by the Company in treasury stock were combined and reclassified into one share of common stock (the “Reverse Stock Split”).

The Reverse Stock Split reduced the number of issued and outstanding shares of common stock from 81,571,864 shares to 13,660,598 shares and reduced the issued shares of common stock held by the Company in treasury stock from 4,611,569 shares to 768,595 shares.

The common stock began trading on a reverse split-adjusted basis at the opening of trading on The Nasdaq Capital Market on April 12, 2024, under the same symbol (FLNT) with a new CUSIP number ( 34380C 201 ).

As of September 30, 2025 and December 31, 2024 , the number of issued shares of common stock was 30,287,597 and 20,791,431 , respectively, which included shares of treasury stock of 768,595 and 768,595 , respectively.

For the nine months ended September 30, 2025 , the increase in the number of issued shares of common stock was the result of the exercise of pre-funded warrants for 5,585,216 shares of common stock, the issuance of 3,542,856 shares of common stock as part of the August 2025 Purchase Agreements (as defined herein), and the issuance of 368,094 shares of common stock issued upon vesting of RSUs, in which no shares of common stock were withheld to cover statutory taxes upon such vesting.

Registered direct offering

November 29, 2024, the Company entered into securities purchase agreements (the "Registered Direct Purchase Agreements") with certain pre-existing institutional investors (the "Registered Direct Investors"), pursuant to which the Company agreed to sell to such investors an aggregate of

2,483,586 shares of common stock of the Company,

$ 0.0005 par value per share (the "Registered Direct Offering").

The Registered Direct Offering was made pursuant to the Company's shelf registration statement on Form S-

3, which was declared effective by the SEC on

September 9, 2024.

In connection with the Registered Direct Offering, the Company entered into a placement agency agreement (the "Placement Agency Agreement") with ThinkEquity LLC as the placement agent (the "Placement Agent"), for the sale of

1,943,676 shares of common stock to the Registered Direct Investors.

Pursuant to the Placement Agency Agreement, the Company, among other things, paid the Placement Agent a cash fee equal to

4 % of the gross proceeds raised in the Registered Direct Offering by an investor making an investment of

The Registered Direct Offering closed on

December 2, 2024, with aggregate gross proceeds totaling

$ 5,750 , before deducting offering expenses payable by the Company of

$ 562 , including the Placement Agent fee.

The Company has used the net proceeds from the Registered Direct Offering for general corporate purposes, which included capital expenditures, working capital and general and administrative expenses.

As of March 31, 2026 and December 31, 2025 , the number of issued shares of common stock was 30,584,307 and 30,404,779 , respectively, which included shares of treasury stock of 768,595 and 768,595 , respectively.

For the three months ended March 31, 2026 , the increase in the number of issued shares of common stock was the result of the exercise of pre-funded warrants for 85,714 shares of common stock and the issuance of 93,814 shares of common stock issued upon vesting of RSUs, in which no shares of common stock were withheld to cover statutory taxes upon such vesting.

Private equity securities offerings

On May 13, 2024, the Company entered into securities purchase agreements (the "May 2024 Purchase Agreements") with certain accredited or sophisticated investors (the "May 2024 Purchasers"), all of whom were related parties, pursuant to which the Company sold pre-funded warrants (the "May 2024 PFWs") to purchase up to 2,955,084 shares of the Company's common stock, at a purchase price of $ 3.384 per May 2024 PFW (the "May 2024 Private Placement").

The May 2024 Purchasers included three officers and/or directors and the largest stockholder of the Company.

No underwriting discounts or commissions were paid with respect to the May 2024 Private Placement.

The aggregate gross proceeds for the May 2024 Private Placement totaled $ 10,000 , before deducting offering expenses payable by the Company of $ 100 .

The May 2024 PFWs, which terminated when exercised in full, had an exercise price of $ 0.0005 per share of common stock and became immediately exercisable upon stockholder approval.

Stockholder approval of the May 2024 Private Placement was obtained on July 2, 2024, at a special meeting of the Company's stockholders.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts in thousands, except share and per share data)

On November 29, 2024, the Company entered into securities purchase agreements (the "December 2024 Purchase Agreements") with certain accredited or sophisticated investors (the "December 2024 Purchasers"), all of whom were related parties, pursuant to which the Company agreed to sell to the December 2024 Purchasers unregistered pre-funded warrants (the "December 2024 PFWs") to purchase up to 1,187,802 shares of the Company’s common stock, at a purchase price of $ 2.3147 per December 2024 PFW and an exercise price of $ 0.0005 per share of common stock (the "December Private Placement").

29 unchanged sentences

The Company is prohibited from effecting an exercise of the August 2025 Warrants to the extent that, as a result of such exercise, the holder together with the holder’s affiliates, would beneficially own more than 4.99 % (or, at the election of the holder, 9.99 %) of the number of shares of common stock outstanding immediately after giving effect to the issuance of shares of common stock upon exercise of the August 2025 Warrants, which beneficial ownership limitation may be increased by the holder up to, but not exceeding, 9.99 %.

Substantially all of the August 2025 Purchasers (other than the August 2025 Inside Investors) exercised their August 2025 PFWs during the month of September 2025, for an aggregate of 1,657,143 shares of common stock, leaving August 2025 PFWs to purchase 671,428 shares unexercised, 585,714 of which are represented by August 2025 Inside Investors and are not exercisable until stockholder approval is obtained.

Substantially all of the August 2025 Purchasers (other than the August 2025 Inside Investors) exercised their August 2025 PFWs during the month of September 2025, for an aggregate of 1,657,143 shares of common stock, with the additional 85,714 shares related to non-affiliates being exercised in February 2026.

The remaining unexercised August 2025 PFWs to purchase 585,714 shares of common stock, all of which are represented by August 2025 Inside Investors and are not exercisable until stockholder approval is obtained.

The Company was obligated to use its reasonable best efforts to obtain such stockholder approval of the exercise of the August 2025 PFWs by August 2025 Inside Investors no later than the 60th calendar day after the closing date of the offering.

3 unchanged sentences

The Company filed a registration statement on Form S- 3 with the SEC on September 15, 2025, and it was declared effective on September 24, 2025.

As of September 30, 2025 , an aggregate of 5,585,216 of the December 2024 PFWs, March 2025 PFWs, May 2025 PFWs, and August 2025 PFWs were exercised.

As of December 31, 2024 , all of the May 2024 PFWs and 647,892 of the December 2024 PFWs were exercised.

The issuance of the March 2025 PFWs, May 2025 PFWs, and August 2025 PFWs was reflected in the Company's stockholders' equity within common stock and additional paid-in-capital as of September 30, 2025 .

As of March 31, 2026 , and December 31, 2025, an aggregate of 5,670,930 and 5,585,216 respectively, of the December 2024 PFWs, March 2025 PFWs, May 2025 PFWs, and August 2025 PFWs were exercised.

The issuance of the March 2025 PFWs, May 2025 PFWs, and August 2025 PFWs was reflected in the Company's stockholders' equity within common stock and additional paid-in-capital.

In accordance with ASC 815 - 40, Derivatives and Hedging, a contract is classified as an equity agreement if it is both indexed to its own stock and classified in stockholders' equity.

The May 2024 PFWs, December 2024 PFWs, March 2025 PFWs, and August 2025 PFWs met the requirements of being classified as equity because (i) they had a fixed share limit and the Company had sufficient authorized and unissued shares, (ii) they required physical or net share settlement, and (iii) no cash payments or settlement top-off was required by the Company.

The December 2024 PFWs, March 2025 PFWs, and August 2025 PFWs met the requirements of being classified as equity because (i) they had a fixed share limit and the Company had sufficient authorized and unissued shares, (ii) they required physical or net share settlement, and (iii) no cash payments or settlement top-off was required by the Company.

Common stock warrants

As of September 30, 2025 and December 31, 2024 , the Company had 7,701,383 and 0 common stock warrants outstanding, respectively.

As of March 31, 2026 and December 31, 2025 , the Company had 7,701,383 and 7,701,383 common stock warrants outstanding, respectively.

The Company determined that the detachable common stock warrants issued in connection with the May 2025 Purchase Agreements and August 2025 Purchase Agreements met the definition of freestanding financial instruments and qualified for classification as permanent equity under applicable accounting guidance.

Equity-classified warrants are those that are indexed to the Company’s own stock and meet the criteria for equity classification under ASC 815 - 40.

These instruments are recorded in equity at fair value on the issuance date and are not subsequently remeasured, provided the Company continues to meet the equity classification criteria.

As the common stock warrants were issued in conjunction with the other equity instruments, the proceeds have been allocated to each using the relative fair value method and recorded as a component of additional paid-in-capital as of the issuance date.

These warrants are included in the diluted earnings per share calculation when they are in-the-money and dilutive, as their features are considered participatory in nature.

See Note 2 , Income (loss) per share , for further detail.

At-the-market issuance

On December 31, 2025, the Company entered into an At-The-Market Issuance Sales Agreement (the “ATM Agreement”) with Lake Street Capital Markets, LLC (“Lake Street”), under which the Company may offer and sell shares of its common stock, par value $ 0.0005 per share (the “Shares”), having an aggregate sales price of up to $ 11,200 through Lake Street as the sales agent.

Sales of shares of the Company’s common stock through Lake Street, if any, will be made by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415 under the Securities Act of 1933, as amended (the “Securities Act”), including, without limitation, sales made directly on The Nasdaq Stock Market LLC or any other existing trading market for the Shares.

Lake Street will use commercially reasonable efforts to sell the Shares from time to time, based on instructions from the Company (including any price, time or size limits or other parameters or conditions the Company may impose).

The Company will pay Lake Street a commission equal to 3.0 % of the aggregate gross proceeds from the sales of Shares sold through Lake Street under the ATM Agreement and will also reimburse Lake Street for certain specified expenses in connection with entering into the ATM Agreement as well as in connection with each Triggering Event Date (as defined in the ATM Agreement).

Pursuant to the ATM Agreement, the Company also provided Lake Street with customary indemnification and contribution rights.

The ATM Agreement contains customary representations and warranties and conditions to the sale of the Shares pursuant thereto.

The Company is not obligated to sell any of the Shares under the ATM Agreement and may at any time suspend solicitation and offers thereunder.

The offering of Shares pursuant to the ATM Agreement will terminate on the earlier of ( 1 ) the sale, pursuant to the ATM Agreement, of Shares having an aggregate offering price of $ 11,200 and ( 2 ) the termination of the ATM Agreement by either the Company or Lake Street, as set forth therein.

Treasury stock

As of September 30, 2025 and December 31, 2024 , the Company held shares of treasury stock of 768,595 and 768,595 , respectively, with a cost of $ 11,407 and $ 11,407 , respectively.

As of March 31, 2026 and December 31, 2025 , the Company held shares of treasury stock of 768,595 and 768,595 , respectively, with a cost of $ 11,407 and $ 11,407 , respectively.

The Company's share-based incentive plans allow employees the option to either make a cash payment or forfeit shares of common stock upon vesting to satisfy federal and state statutory tax withholding obligations associated with equity awards.

The forfeited shares of common stock may be taken into treasury stock by the Company or sold on the open market.

For the nine months ended September 30, 2025 , no shares of common stock were withheld to cover statutory taxes owed by certain employees for this purpose.

For the three months ended March 31, 2026 , no shares of common stock were withheld to cover statutory taxes owed by certain employees for this purpose.

See Note 8 , Share-based compensation .

5 unchanged sentences

The 2022 Plan was amended on June 18, 2025 at the Company’s annual meeting of stockholders which approved an increase of the number of shares of common stock authorized for issuance under the 2022 Plan by 2,000,000 shares.

As of September 30, 2025 , the Company had 2,325,918 shares of common stock available for grants pursuant to the 2022 Plan, which includes 328,517 shares of common stock previously available for issuance under the 2018 Stock Incentive Plan.

On September 22, 2025, the Company's Board of Directors approved the Fluent, Inc.

As of March 31, 2026 , the Company had 1,619,116 shares of common stock available for grants pursuant to the 2022 Plan, which includes 328,517 shares of common stock previously available for issuance under the 2018 Stock Incentive Plan.

On September 22, 2025, the Company's board of directors (the "Board" or "Board of Directors") approved the Fluent, Inc.

Equity Participation Plan (the “2025 Plan”).

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No additional shares were authorized in connection with the adoption of the 2025 Plan.

The primary purpose of the 2022 Plan and prior plans is to attract, retain, reward, and motivate certain individuals by providing them with opportunities to acquire or increase their ownership interests in the Company.

In October 2022, the Company issued to certain of its senior officers and employees, RSUs (time-based vesting), long-term incentive grants (performance and time-based vesting RSUs), or performance share units ("PSUs") (achievement of performance targets settled in cash) under the 2022 Plan.

The primary purpose of the 2025 plan, 2022 Plan and prior plans is to attract, retain, reward, and motivate certain individuals by providing them with opportunities to acquire or increase their ownership interests in the Company.

In October 2022, the Company issued to certain of its senior officers and employees, RSUs (time-based), long-term incentive grants (performance and time-based vesting RSUs), or performance stock units ("PSUs") (on achievement of targets, a cash payout) under the 2022 Plan.

In October 2025, the Company issued to certain of its senior officers and employees, RSU (time-based, a cash payout) and PSUs (performance and time-based vesting RSUs, a cash payout) under the 2025 Plan.

Further, it issued RSUs (time-based) and PSUs (on achievement of targets) under the 2022 Plan.

Stock options

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provided, that no shares will vest prior to the first anniversary of the grant date.

As of September 30, 2025 , the first condition for the stock options issued on February 1, 2019, December 20, 2019 and March 1, 2020 had been met and the second condition for the stock options issued on December 20, 2019 and March 1, 2020 had been met.

Any stock options that remain unvested as of the fifth anniversary of the grant date will vest in full on such date.

As of March 31, 2026 , the first condition for the stock options issued on February 1, 2019, December 20, 2019 and March 1, 2020 had been met and the second condition for the stock options issued on December 20, 2019 and March 1, 2020 had been met.

Any stock options that remained unvested as of the fifth anniversary of the grant date were vested in full on such date.

The fair value of the stock options granted was estimated at the trading day before the date of grant using a Monte Carlo simulation model.

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(Amounts in thousands, except share and per share data)

For the nine months ended September 30, 2025 , details of stock option activity were as follows:

For the three months ended March 31, 2026 , details of stock option activity were as follows:

Number of stock options

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331,667 $ 16.35 5.6 $ —

( 66,000 ) — — —

Outstanding as of September 30, 2025

Outstanding as of March 31, 2026

331,667 $ 16.35 5.3

Options exercisable as of September 30, 2025

Options exercisable as of March 31, 2026

199,167 $ 25.35 3.3

The aggregate intrinsic value amounts in the table above represent the difference between the closing price of the Company's common stock at the end of the reporting period and the corresponding exercise prices, multiplied by the number of in-the-money stock options as of the same date.

For the nine months ended September 30, 2025 , the unvested balance of stock options was as follows:

For the three months ended March 31, 2026 , the unvested balance of stock options was as follows:

Number of stock options

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( 6,000 ) — —

Unvested as of September 30, 2025

Unvested as of March 31, 2026

132,500 $ 2.81 8.4

Compensation expense recognized for stock options was $ 59 and $ 4 for the three months ended September 30, 2025 and 2024 , respectively, and $ 96 and $ 5 for the nine months ended September 30, 2025 and 2024 , respectively, was recognized in product development and general and administrative expenses in the consolidated statements of operations.

As of September 30, 2025 , there was $ 203 of unrecognized share-based compensation with respect to outstanding stock options.

Compensation expense recognized for stock options was $ 15 and $ 19 for the three months ended March 31, 2026 and 2025 , respectively, and was recognized in product development and general and administrative expenses in the consolidated statements of operations.

As of March 31, 2026 , there was $ 115 of unrecognized share-based compensation with respect to outstanding stock options.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

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Restricted stock units and restricted stock

For the nine months ended September 30, 2025 , details of unvested RSU activity were as follows:

For the three months ended March 31, 2026 , details of unvested RSU activity were as follows:

Number of units

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( 68,492 ) 3.00

( 77,251 ) 3.63

Unvested as of September 30, 2025

Unvested as of March 31, 2026

1,337,181 $ 11.88

As discussed in Note 7 , Equity , the treasury stock relates to shares withheld to cover statutory withholding taxes upon the delivery of shares following the vesting of RSUs.

As of September 30, 2025 , there were 768,595 outstanding shares of treasury stock.

As of March 31, 2026 , there were 768,595 outstanding shares of treasury stock.

Vested not delivered represents vested RSUs with delivery deferred to a future time.

For the nine months ended September 30, 2025 , there was a change in the vested not delivered balance due to a net 21,897 shares that were deferred due to timing of delivery of certain shares, of which no shares had elected deferred delivery.

As of September 30, 2025 , 307,556 outstanding RSUs were vested not delivered.

Compensation expense recognized for RSUs of $ 427 and $ 466 for the three months ended September 30, 2025 and 2024 , respectively, and $ 1,078 and $ 1,517 for the nine months ended September 30, 2025 and 2024 , respectively, was recorded in sales and marketing, product development and general and administrative in the consolidated statements of operations, and intangible assets, net in the consolidated balance sheets.

For the three months ended March 31, 2026 , there was a change in the vested not delivered balance due to a net 13,047 shares that were deferred due to timing of delivery of certain shares, of which no shares had elected deferred delivery.

As of March 31, 2026 , 283,758 outstanding RSUs were vested not delivered.

Compensation expense recognized for RSUs of $ 787 and $ 330 for the three months ended March 31, 2026 and 2025 , respectively, was recorded in sales and marketing, product development and general and administrative in the consolidated statements of operations, and intangible assets, net in the consolidated balance sheets.

The fair value of the RSUs and restricted stock was estimated using the closing prices of the Company's common stock on the dates of grant.

As of September 30, 2025 , unrecognized share-based compensation expense associated with the granted RSUs and stock options amounted to $ 1,803 , which is expected to be recognized over a weighted average period of 1.8 years.

For the three and nine months ended September 30, 2025 and 2024 , share-based compensation for the Company's stock options, RSUs, and common stock awards were allocated to the following accounts in the consolidated financial statements:

Three Months Ended September 30,

Nine Months Ended September 30,

As of March 31, 2026 , unrecognized share-based compensation expense associated with the granted RSUs and stock options amounted to $ 2,240 , which is expected to be recognized over a weighted average period of 1.9 years.

For the three months ended March 31, 2026 and 2025 , share-based compensation for the Company's stock options, RSUs, and common stock awards were allocated to the following accounts in the consolidated financial statements:

Three Months Ended March 31,

Sales and marketing

$ 123 $ 22 $ 175 $ 163

Product development

80 74 162 174

General and administrative

275 364 812 1,146

Share-based compensation expense

478 460 1,149 1,483

Capitalized in intangible assets

Total share-based compensation

$ 486 $ 470 $ 1,174 $ 1,522

As of September 30, 2025 and December 31, 2024 , the Company recorded a liability of $ 25 and $ 29 , respectively, related to PSUs that are to be settled in cash.

As of March 31, 2026 and December 31, 2025 , the Company recorded a liability of $ 328 and $ 165 , respectively, related to PSUs that are to be settled in cash.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts in thousands, except share and per share data)

Segment information

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The use of EBITDA as a financial metric provides management and investors with a clearer view of the core business performance and profitability, excluding the effects of financing and other non-operational expenses.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts in thousands, except share and per share data)

As of September 30, 2025 , the Company had three operating segments:

a) "Fluent", representing Owned and Operated and Commerce Media Solutions revenue, b) "Call Solutions", and c) "AdParlor".

The Company determined that there was one reportable segment, "Fluent," for the purposes of segment reporting.

The Fluent reporting segment combines the Fluent operating segment with the Call Solutions operating segment.

As of March 31, 2026 , the Company had two continuing operating segments:

a) "Fluent", which is Owned and Operated and Commerce Media Solutions revenue, and b) "AdParlor".

The Company determined that it has one reportable segment, "Fluent," for the purposes of segment reporting.

The Fluent reporting segment combines Fluent with the Call Solutions operating segment.

The Company noted that as of January 31, 2026, Call Solutions was divested (refer to Note 12, Divestiture, below for details), however, did not trigger a re-assessment under ASC 280.

This reporting unit works with advertisers to then bring consumers to their products through multiple media channels and earn revenue when a consumer completes an action as agreed upon with the advertisers.

The "All Other" segment represents the operating results of AdParlor, LLC, which mainly performs media buying, and those businesses sold or in run-off, which are included for purposes of reconciliation of the respective balances below to the consolidated financial statements.

The remaining activity represents the operating results of AdParlor, LLC, which mainly performs media buying, and those businesses sold or in run-off, which are included for purposes of reconciliation of the respective balances below to the consolidated financial statements and included within "Unallocated" below.

The Company determined its segments based on revenue sources and its agreements with advertisers.

Some advertisers span multiple segments, which are managed consistently with shared management.

As of December 31, 2024, the Company adopted ASU 2023 - 07.

Accordingly, the segment disclosures provided have been updated in accordance with the current presentation and accounting standard requirements.

In addition, certain advertisers overlap within the different operating segments and they are managed consistently with shared management.

Further, the Company considered other qualitative factors, such as the environment operated in, and quantitative factors to determine its reportable segment.

The significant expense categories and amounts align with the segment-level information that is regularly provided to and used by the CODM in evaluating performance and EBITDA profitability and were identified as a) cost of revenue b) salaries and benefits, c) professional fees, and d) IT and software.

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The allocation methodology is regularly assessed, evaluated and subject to future changes.

Summarized financial information concerning the Company's segments for the three and nine months ended September 30, 2025 and 2024 are shown in the following tables below, noting prior period amounts have been recast to conform to the Company's current period segment presentation:

Three Months Ended September 30,

Summarized financial information concerning the Company's segments for the three months ended March 31, 2026 and 2025 are shown in the following tables below, noting prior period amounts have been recast to conform to the Company's current period segment presentation:

Three Months Ended March 31,

Revenue (1) :

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$ 42,825 $ 53,821

Costs of revenue

Cost of revenue (exclusive of depreciation and amortization)

35,858 297 36,155 47,824 1,037 48,861

Costs and expenses:

Salaries and benefits

7,805 1,024 8,829 8,843 1,478 10,321

Professional fees

2,391 87 2,478 1,810 244 2,054

IT and software

1,142 65 1,207 967 124 1,091

Other segment items (2)

1,840 345 2,185 3,316 392 3,708

$ ( 4,201 ) $ 376 $ ( 3,825 ) $ ( 1,283 ) $ ( 236 ) $ ( 1,519 )

Depreciation and amortization

2,422 56 2,478 2,319 50 2,369

Total (loss) income from operations

$ ( 6,623 ) $ 320 $ ( 6,303 ) $ ( 3,602 ) $ ( 286 ) $ ( 3,888 )

Reconciliation of profit or loss

Interest Expense

( 711 ) ( 1,281 )

Fair value adjustment of Convertible Notes with related parties

( 554 ) ( 2,810 )

Loss on early extinguishment of debt

Loss before income taxes

$ ( 7,568 ) $ ( 7,979 )

( 1 ) Revenue aggregation is based upon location of the customer.

( 2 ) Balance includes sales and marketing expense, travel and entertainment expense, office overhead, restructuring and severance, goodwill impairment and impairment of intangible assets, and other operating costs.

Nine Months Ended September 30,

Revenue (1) :

United States

$ 92,132 $ 5,177 $ 97,309 $ 111,337 $ 14,646 $ 125,983

International

49,636 — 49,636 63,233 — 63,233

Total segment revenue

Reconciliation of revenue

Other revenue

Total revenue

$ 44,852 $ 55,210

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Salaries and benefits

22,837 3,071 25,908 26,844 7,029 33,873

Professional fees

6,051 251 6,302 5,923 820 6,743

IT and software

3,399 210 3,609 2,899 594 3,493

Other segment items (2)

Segment EBITDA

$ ( 2,257 ) $ ( 4,278 )

Reconciliation of Segment EBITDA to loss before income taxes

Segment EBITDA (from above)

$ ( 2,257 ) $ ( 4,278 )

Unallocated revenue

Unallocated cost of revenue (exclusive of depreciation and amortization)

Unallocated salaries and benefits

Unallocated professional fees

Unallocated IT and software

Unallocated other operating items (2)

Depreciation and amortization

7,252 166 7,418 6,706 801 7,507

Total (loss) income from operations

$ ( 20,665 ) $ 180 $ ( 20,485 ) $ ( 10,571 ) $ ( 7,648 ) $ ( 18,219 )

Reconciliation of profit or loss

Interest Expense

( 2,293 ) ( 3,711 )

Interest expense, net

Fair value adjustment of Convertible Notes, with related parties

( 156 ) ( 2,810 )

Loss on early extinguishment of debt

Loss before income taxes

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( 1 ) Revenue aggregation is based upon location of the customer.

September 30,

( 2 ) Balance includes sales and marketing expense, travel and entertainment expense, office overhead, restructuring and severance, impairment of intangible assets, and other operating costs.

Total assets:

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$ 72,271 $ 89,133

As of September 30, 2025 , long-lived assets are all located in the United States.

For the nine months ended September 30, 2025 , 20.2 % of the Company's consolidated revenue was earned from customers located in Israel.

As of March 31, 2026 , long-lived assets are all located in the United States.

For the three months ended March 31, 2026 , 27.3 % of the Company's consolidated revenue was earned from customers located in Israel.

In addition, the Company identified an international customer within the Fluent segment that represented 13.1 % of the Company’s consolidated revenue.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

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The Company does not accrue liabilities when the likelihood that the liability has been incurred is probable but the amount cannot be reasonably estimated.

On January 28, 2020, the Company received a Civil Investigative Demand from the Federal Trade Commission ("FTC") regarding compliance with the FTC Act and the Telemarketing Sales Rule.

On July 17, 2023, the FTC and the Company filed a Joint Motion for Entry of Proposed Stipulated Order (the "FTC Consent Order") in the United States District Court for the Southern District of Florida.

The FTC Consent Order was entered by the Court on August 11, 2023, and the escrow funds were released on August 15, 2023.

On August 12, 2024, the Company filed its required compliance report.

The Company was involved in a Telephone Consumer Protection Act class action, Daniel Berman v.

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The final approval of the Berman Settlement Agreement was filed on February 23, 2024.

To satisfy its obligations under the Berman Settlement Agreement, the Company made a cash payment of $ 1,100 on March 15, 2024 and issued a junior secured promissory note in the principal amount of $ 2,000 payable to the co-defendant, FDR, as discussed in Note 4 , Long-term debt, net .

Variable interest entity

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The Company assesses whether it is the primary beneficiary of a VIE at the inception of the arrangement and as of the reporting date.

On May 1, 2024, the Company and Caspian Ventures, LLC ("Caspian") entered into a membership interest purchase agreement pursuant to which the Company conveyed 100 % of the membership interests of True North Loyalty, LLC and its direct and indirect subsidiaries (collectively, "True North") to Caspian (the "True North Conveyance").

True North is a subscription-based business that utilizes call center operations and other media channels to market third -party recurring revenue services to consumers.

The deemed fair value of the consideration received was $ 989 , which consisted of (i) the forgiveness of a $ 500 deferred payment owed by the Company in connection with the Company's acquisition of True North on January 1, 2022 ( the "True North Acquisition"), (ii) a share of the True North contribution margin after the closing until the Company has received an amount equal to the closing net working capital of approximately $ 168 , and (iii) a continued share of the True North contribution margin of an additional amount at fair value of $ 321 .

The True North founder entered into an employment agreement in connection with the True North Acquisition and has remained an employee of the Company following the closing of the True North Conveyance.

The Company determined that True North did not meet the discontinued operations criterion under ASC 205 - 20, Discontinued Operations .

In accordance with ASC 810, Consolidation ("ASC 810" ), the Company determined that True North was a VIE based upon the consideration to be received.

Initially, the controlling member of Caspian remained a full-time employee of the Company and had the power to unilaterally make significant decisions at True North, so the Company determined that it was the primary beneficiary of Caspian and therefore should consolidate Caspian's operations going forward, under the de facto agent guidance.

As a result, no gain or loss was to be recognized on the True North Conveyance.

On September 1, 2024, however, Caspian’s operating agreement was amended to require the consent of multiple members rather than a majority interest for major decisions.

As a result, the Company determined that it was no longer the primary beneficiary, and under ASC 810, True North was no longer consolidated as of September 1, 2024.

No gain or loss was recognized as a result of the change at that time.

As of December 31, 2024 , True North had ceased operations and the remaining receivable was fully written off.

As of January 9, 2023, the Company initially determined that TAPP qualifies as a VIE because it held a variable interest and was the primary beneficiary.

This conclusion was based on the Company’s significant influence over TAPP’s key employees through their employment agreements and its role as the primary source of TAPP’s revenue.

During the first quarter of 2025, TAPP’s key employee became a consultant to the Company.

However, the Company concluded that it still had significant influence over TAPP, so the Company continued to consolidate TAPP's operations.

As the Company did not have an equity interest in TAPP, 100% of the net assets and results of the operations of TAPP were attributable to non-controlling interests.

During the first quarter of 2025, TAPP’s key employee became a consultant to the Company, but as the Company concluded that it still had significant influence over TAPP, it continued to consolidate TAPP's operations.

However, as the Company did not have an equity interest in TAPP, 100% of the net assets and results of the operations of TAPP were attributable to non-controlling interests.

On May 20, 2025, the Company made a one -time payment of $ 300 and entered into an updated agreement with the key employee and TAPP, terminating all prior agreements.

As a result, the Company determined that it was no longer the primary beneficiary, and under ASC 810 , TAPP was no longer being consolidated under ASC 810.

The Company recognized a loss of $ 698 in general and administrative expenses in the consolidated statements of operations, mainly related to the write-off of the intangible assets, as discussed in Note 3 , Intangible assets, net.

The Company recognized a loss of $ 698 in general and administrative expenses in the consolidated statements of operations in the second quarter of 2025, mainly related to the write-off of the intangible assets.

On January 31, 2026, Inbox Pal, LLC, an indirect subsidiary of the Company and InsurCo, LLC (“InsurCo”) entered into a membership interest purchase agreement pursuant to which it conveyed 100 % of the membership interests of Winopoly, LLC.

("Winopoly") to InsurCo.

Winopoly was a call center-supported performance marketplace that provided live-call-based performance campaigns to help clients increase engagement through the Company's Call Solutions business.

The deemed fair value of the consideration received was approximately $2,800, which consisted of a $ 3,000 secured promissory note (the “Note”) along with forgiveness of approximately $200 owed to the Company related to the profit share obligation.

The Note bears interest at 12.96 % per annum and is payable in monthly installments of $100.

In connection with the transaction, the Company conveyed dissimilar assets relating to the Call Solutions business, excluding net working capital.

In addition, the Company terminated all remaining employees related to Winopoly prior to the transaction.

InsurCo’s members are former employees of the Company.

The conveyance did not meet the threshold of a discontinued operation under ASC 205 - 20.

The Company determined the conveyance of Winopoly was a business under ASC 805, Business Combinations.

As a result, in accordance with ASC 810, Consolidation, the Company recognized a gain of $2,352 on the conveyance of Winopoly, which is reflected in general and administrative expenses.

Going forward, the Company’s continuing relationship with InsurCo will be limited to the payment of the Note.

As of March 31, 2026, the Note has a principal balance of $ 969 , reflected in prepaids and other current assets, and $ 1,962 , reflected in other non-current assets.

Subsequent events

The Company has evaluated subsequent events through

November 14, 2025, and has determined that there are

no material subsequent events to disclose in the consolidated financial statements.

The Company has evaluated subsequent events through May 13, 2026, and has determined that there are no material subsequent events to disclose in the consolidated financial statements.

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 1. Financial Statements