ACCESS Newswire Inc. 2026 Q2 Earnings Call

Thank you, Forest, and good morning, everyone. Thank you for joining us to discuss our second quarter 2026 results. Let me start with the headline number. Second quarter revenues was $5.6 million, up 5% sequentially from $5.3 million in the first quarter, and essentially consistent with the second quarter of last year. Core press release revenue increased 2% year over year, which tells us that the underlying engine of this business remains healthy. That was offset, however, by lower revenues from our webcast business, where we saw fewer virtual annual meetings and less reseller activity. I want to spend a moment on where we made up real progress. Average ARR per subscription customer was $12,718 at the end of the quarter, up from $11,039 a year ago, a 15% increase and another quarter of ARR growth.

This is the clearest evidence that our platform strategy, moving customers onto higher value tiers, continues to work. That progress is being driven by the products that we built and have brought to market over the last 90 days. Our Social Monitoring platform and our new Insight & Analytics Report are both live, and early adoption is encouraging. We expect to release several more products before year's end, and our focus is now turning that innovation into subscriber and revenue growth in our subscription business. Steve is going to walk you through the numbers in detail, and then I'd like to touch on a few topics from the first half of this year and what our priorities are for the second half of the year.

Steve? Thank you, Brian, and good morning, everyone.

I will now take you through the second quarter and first half 2026 financial results. Total revenue for the second quarter of 2026 was $5.6 million, an increase of approximately $291,000, or 5%, compared to Q1 2026, and essentially unchanged compared to Q2 2025. The sequential increase was primarily driven by a 10% increase in volume from our core press release business, reflecting the seasonal pattern we typically see following the first quarter. Core press release revenue increased 2% compared to Q2 2025, while lower revenue from our ProPlan customers partially offset that growth. Webcasting revenue was also lower compared to Q2 2025 due to fewer virtual annual meetings and reseller activity. For the first six months of 2026, total revenue was $10.9 million, down $152,000, or 1%, from $11.1 million in the first half of 2025.

The year-over-year decline was primarily attributable to lower webcasting and ProPlan revenue. Importantly, revenue from our core press release business increased 1% for the first half of 2026 compared to the same period last year. Gross margin for Q2 2026 was $4.1 million, or 73% of revenue, compared to $4 million, or 74% of revenue in Q1 2026, and $4.3 million or 76% of revenue in Q2 2025. The first half of 2026 gross margin was $8.1 million, or 74% of revenue, compared to $8.6 million or 77% of revenue in the first half of 2025. The year-over-year decline in gross margin percentage primarily reflects higher press release distribution costs from a combination of new partners, price increases from existing partners, and additional usage under variable contracts.

As Brian will discuss, we have implemented initiatives designed to reduce costs of revenues by approximately $150,000 in the back half of the year. Moving to operating expenses, total operating expenses were $4.4 million in Q2 2026, down slightly from $4.5 million in Q2 2025. For the first six months, total operating expenses were $9.1 million, down approximately $0.4 million or 4% from $9.5 million in the first half of 2025. We continue to balance cost discipline with targeted investment in areas we believe can support future growth. General and administrative expenses were $1.35 million in Q2 2026, down $402,000 or 23% year over year. For the first half of 2026, G&A expenses were $3.1 million, down $574,000 or 15%.

The decrease reflects lower non-recurring expenses, stock-based compensation, and bad debt expense, as well as lower insurance and office costs following the sale of the compliance business and our move to a remote work environment. Sales and marketing expense was $1.9 million in Q2 2026, up $427,000 or 29%, compared to Q2 2025. For the first half of 2026, sales and marketing expense was $3.6 million, up $514,000 or 17%. This increase reflects our deliberate investment in advertising and trade shows as we work to convert our product innovation into customer and revenue growth. Product development expense was $533,000 in Q2 2026, down $122,000 or 19% year-over-year, and $1.1 million for the first half of 2026, down $295,000 or 21%. The decrease was primarily due to higher capitalized software costs.

We capitalized $110,000 of software development costs in Q2 2026, and $209,000 for the first six months of 2026, compared to zero and $23,000 respectively in the comparable periods of last year. The costs mostly reflect the investment we made in our Social Monitoring and Insight & Analytics enhancements that we rolled out during the second quarter, as well as some additional enhancements Brian Balbirnie will speak more about. Operating loss for Q2 2026 was $307,000, compared to $249,000 during the second quarter of 2025. For the first half of 2026, operating loss was $1 million, compared to $926,000 in the first half of 2025. The year-over-year change was primarily driven by lower gross margin, partially offset by lower operating expenses.

On a GAAP basis, net loss from continuing operations was $354,000, or $0.09 per diluted share for Q2 2026, compared to $239,000 or $0.06 per diluted share during the second quarter of 2025. For the first six months, net loss from continuing operations was $965,000, or $0.25 per diluted share, compared to $1 million or $0.26 per diluted share in the first half of 2025. On a non-GAAP basis, EBITDA was $0.5 million or 8% of revenue for the second quarter of 2026 compared to $0.5 million or 9% of revenue during the second quarter of 2025. Adjusted EBITDA was $0.6 million or 11% of revenue for Q2 2026 compared to $0.8 million or 15% of revenue in Q2 2025.

Non-GAAP net income was $0.3 million or $0.08 per diluted share during the second quarter of 2026 compared to $0.6 million or $0.14 per diluted share in the prior year quarter. Adjusted Free Cash Flow was $50,000 for Q2 2026 compared to $250,000 in Q2 2025. For the first half of 2026, EBITDA amounted to $0.5 million or 4% of revenue, consistent with the first half of 2025. Adjusted EBITDA was $1.2 million or 11% of revenue compared to $1.4 million or 13% of revenue in the prior year period. Non-GAAP net income was $0.7 million or $0.18 per diluted share compared to $0.8 million or $0.20 per diluted share last year. Adjusted Free Cash Flow was $1 million for the first half of 2026 compared to $1.2 million for the first half of 2025. Cash flow from operations was $173,000 in Q2 2026 compared to $135,000 in Q2 2025.

We ended the quarter with just under $3 million in the bank, and Brian will talk a little further about our share repurchase activity, which was ongoing during the quarter. The deferred revenue balance, which we expect to recognize over the next 12 months, was $5.1 million as of June 30th, 2026, compared to $5.3 million at December 31st, 2025. As we enter the second half of the year, our financial priorities remain consistent. Maintain operating discipline, invest selectively behind the products and go-to market initiatives that can drive revenue and subscription growth, and continue to strengthen the economics of the business. The progress in subscription ARR per customer continued positive Adjusted EBITDA and our focus on cost efficiencies gives us a solid foundation as we work to improve top line performance. With that, I will turn it back over to Brian.