Good afternoon and thank you for joining us for the GameSquare Holdings' 2026 Second Quarter Conference Call. On the call today, we have Justin Kenna, GameSquare's CEO, and Mike Munoz, CFO. During the call, all participants are in listen-only mode. Following the presentation, we will conduct a question and answer session. Before management discusses the results, I'd like to remind everyone that certain statements in this call may be forward-looking in nature. These include statements involving known and unknown risk and other factors that could cause actual results to differ materially from those expressed or implied in our forward-looking statements. For information about forward-looking statements and risk factors, please see our 10-K for the quarter ended June 30th, 2026, which will be available on the company's website or with the Securities and Exchange Commission. I will now turn the call over to GameSquare CEO, Justin Kenna. Justin, please go ahead.

Thank you, and good afternoon to everyone joining us on today's call. GameSquare delivered a strong second quarter that marked an important step forward in our financial performance. Revenue increased 137% year-over-year to $18.5 million, gross margin expanded by nearly 20 percentage points to 49%, and adjusted EBITDA improved to a second quarter record of $1 million. These results were ahead of our expectations, and represented a meaningful acceleration from both the first quarter and the prior year period. Most importantly, our second quarter results demonstrate that GameSquare is generating profitable growth from its underlying operations. Our performance also reflects the strength of the integrated platform we've built and the early benefits of recent acquisitions, including Qlik and TrueBuddy. Qlik has expanded our creative marketing, talent management and campaign execution capabilities while TubeBuddy adds a high-margin technology and SaaS layer that supports creators and publishers with workflow analytics, optimization, and AI-enabled tools. Together with StreamHatch's data measurement and creator intelligence capabilities, these businesses position GameSquare as a differentiated entry point into the creator economy, helping brands and publishers identify the right creators, Activate campaigns, optimise content and measure performance through a single platform. Our second quarter results are encouraging and we're excited as we enter the seasonally strong second half of the year. So I want to use my time today to review our second quarter performance in more detail, discuss the progress that we're making across the business and provide an update on our expectations for the balance of 2026. GameSquare's profitable growth in the second quarter demonstrates that our operating strategy is producing the intended results. As revenue scales, a higher margin business mix and prudent operating expense management are drawing meaningful operating leverage across the platform. This progress reinforces our confidence in the scalability and earnings potential of our operating model. When combined with our strong financial position, we believe we have the resources, and flexibility needed to continue investing in high return growth initiatives, including technology, premium intellectual property, creator relationships and other opportunities that can deepen customer engagement, expand margins and create long-term shareholder value. Talent remains an important growth engine for Gamesquare and a key differentiator of our platform. During the second quarter, we continued to expand Klik's roster with the signing of CypherPK, one of the world's largest and most influential gaming creators. Cypher reaches more than 20 million followers and subscribers across YouTube, Twitch, Instagram and other major platforms, making him Klik's highest profile creator addition to date. The addition of Cypher builds on the momentum we discussed last quarter. including the appointment of Justin Miclat as Chief Growth Officer of Qlik and assigning a stake to the second largest Roblox creator. Together, these additions have expanded Qlik's creator network to more than 60 million followers across major social platforms and increased the premium creator inventory available to our brand partners. They also create additional opportunities across brand partnerships, content live experiences, commerce and intellectual property. Our talent strategy is also expanding beyond gaming into athlete and lifestyle creators, where we are building a sizeable pipeline. A recent example is a new partnership that we were able to get for UFC athlete Max Holloway with Whatnot. These adjacent categories broaden our audience reach and create additional opportunities to monetize talent across content, commerce, sponsorships, and experiences. As we scale these relationships across GameSquare's platform, We believe that talent can drive higher-value programs, greater campaign volume, and attractive operating leverage. Our integrated platform continues to drive strong commercial momentum. One recent example is our work with Marvel on the Marvel Rivals Ignite 2026 mid-season finale. Following quarter-end, GameScope produced a four-day global esports event in Los Angeles providing turnkey production and talent management as well as monetization services across sponsorship sale, ticketing, and merchandise. The event generated approximately 699,000 hours watched, reached peak concurrent viewership of 54,600, and was distributed across 64 channels in more than five languages. The relationship is an important validation of GameSquare's platform. Marvel, part of the Walt Disney Company, trusted Gainsquare to create and deliver a major global competitive moment around one of the world's most recognized and carefully protected intellectual properties. Our team managed the event end-to-end, including event design, broadcast, tournament operations, venue logistics, sponsorship integration, talent management, and real-time measurement through Stream Hatchet. This is the type of opportunity our integrated platform was built to support, by helping leading IP owners activate and monetize their properties across live experiences, content, creative sponsorship, merchandise, and data-driven measurement with one partner accountable for execution. The successful mid-season finale also positions us to build on the relationship as the Marvel rivals competitive season advances toward the Ignite Grand Finals later this year. Beyond Marvel Rivals, we have booked a broad range of additional high-profile projects that we expect to contribute to second-half revenue growth, including a new relationship with Tencent within our influencer marketing business, our selection to produce the first ever Innovation Awards at the upcoming Roblox Developer Conference, support for a Red Bull event featuring our newly signed talent, CyberPK, and a renewed relationship with REP for 2027. We also expect the second half to benefit from the expansion of Fade Esports, new strategic marketing services and creator and community activations in conjunction with TikTok for an upcoming NBA gaming crossover event in LA with leading NBA talent. These projects add to recently announced wins with Riot Games, the Esports World Cup, the US Army and Corsair. More broadly, Gamesquare has developed a proven track record bringing to life leading gaming entertainment and sports IP, including work with Fortnite, Roblox, Marvel Rivals, Lego, and the Dallas Cowboys. Across these relationships, we combine creators, content, live production sponsorships, experiential execution, data and measurement to create compelling fan experiences and commercial programs. This capability is becoming an important differentiator and a source of larger repeatable opportunities across our ecosystem. Our recurring client relationships are also strengthened. Our agency of record clients have maintained a 100% renewal rate to date in 2026 and our content division is on track for a record year supported by work for TurboTax, HyperX, Roblox and Marvel Rivals. In parallel, we are expanding access to premium IP and commercial rights through World of Dance, The Esports Awards and the Mobis, creating differentiated inventory that can be monetized across multiple parts of the games ecosystem. We are encouraged by the visibility we have into the seasonally strongest second half of 2026. Our confidence is supported by booked programs across Games Square Experiences, influencer marketing, our content team, esports, talent and technology, as well as a growing pipeline of global brands, publishers and IP owners. Historically, approximately 60% of our revenue has occurred in the second half of the year, and current activity reinforces our confidence in our full year plan. We are also expanding our creative and strategy capabilities in the UK with the addition of Tom Wilde, who brings experience from Publicis and Mindshare. This strengthens our ability to serve clients across Europe and supports a disciplined international pipeline. We are also developing opportunities in additional markets, including the Middle East, and will pursue expansion where we can leverage our existing platform efficiently and, importantly, profitably. Our talent pipeline and technology products provide additional growth opportunities. Qlik's expanding roster creates new brand partnerships, content, commerce, and experiential opportunities, while Stream Hatchet's creative communities extends our capabilities from analytics into creative discovery, activation and campaign management, and performance reporting. We expect initial commercialization efforts to begin contributing during this second half. TubeBuddy is also showing encouraging early results from its new AI-powered video ideation tool, which uses creators' proprietary channel data, audience comments, and identity to generate personalized data-backed recommendations. Since active marketing began in early July, TubeBuddy has experienced approximately 10% increase in new subscribers, while users who activate the feature have converted to paid subscribers at roughly 10 times the rate of non-activated users. These results support our view that AI-driven product innovation can support engagement, conversion, and recurring technology revenue. Together with StreamHatchet's creator intelligence and campaign measurement capabilities, ShoeBuddy strengthens GameSquare's position as an entry point into the creator economy for brands, publishers, and creators. Collectively, our book programs, Recurring Customer Relationships, Expanding Talent, Pipeline and developing technology offerings provide meaningful visibility into the balance of the year. We expect to announce additional customer wins, creative relationships and commercial partnerships over the coming months. Combined with improving operating leverage, this pipeline reinforces our confidence in continued growth and, again, importantly, profitability. As GameSquare's operating platform continues to scale and generate improving profitability, our capital allocation strategy is also evolving. Our objective is to allocate capital towards the opportunities we believe offer the most attractive risk-adjusted returns and the greatest potential to create long-term shareholder value. We remain optimistic on the long-term potential of EASE and other digital assets, as well as revenue opportunities from a growing pipeline of Web3 and on-chain customers. At the same time, we recognize that digital asset values can be volatile and are largely influenced by external market conditions. As a result, we tend to opportunistically monetize portions of our digital asset treasury when we believe the capital can generate a more attractive return elsewhere. We started to do that, which is hopefully being evidenced by the PR around some of the liquidity within our e-holdings and also our recent buybacks within our share repurchase program. Our current priorities include repurchasing GameSquare shares when we believe they trade at a meaningful discount to the underlying value of the business and investing in high return growth initiatives across our operating platform. These uses of capital are more directly within our control and allow us to leverage the capabilities customer relationships and intellectual property we've built to drive revenue growth, margin expansions and increased profitability. Since the beginning of our repurchase program, we have repurchased more than 8.8 million shares for approximately $4.1 million, including 2.8 million shares during the second quarter and an additional 1 million shares in July. We believe repurchasing shares at attractive valuations can be highly accretive can be a highly accretive use of capital, particularly as the underlying operating performance of the business continues to improve. Ultimately, our approach is not based on maintaining a fixed allocation to any one asset class. We will continue evaluating the relative return potential of our DAT, share repurchases, organic investments, and strategic opportunities, and we'll deploy capital where we believe it can create the greatest value for shareholders. In addition to deploying capital thoughtfully, We are taking steps to preserve the flexibility needed to support GameSquare's long-term growth. As disclosed in our recently filed proxy statement, stockholders will vote at an August 13 special meeting on authorizing the board to enact a potential reverse stock split, if necessary, to regain compliance with NASDAQ's minimum bid price requirement. Beyond supporting our continued NASDAQ listing, a potential reverse stock split provides the flexibility to support a more appropriate share price and potentially important, Games Square's appeal to institutional investors whose investment mandate may limit their ability to own lower priced securities. Overall, our second quarter results demonstrate that Games Square is building a larger, higher margin and increasingly profitable operating platform. We're encouraged by the progress across the business and believe our improving financial performance and evolving capital allocation strategy positioned us well to invest in growth while creating value for shareholders. We remain focused on disciplined execution and converting our strong commercial momentum into sustained revenue growth, operating leverage and profitability. So with this overview, I'll turn the call over to Mike to review our 2026 second quarter financial results. Mike.

Thanks Justin. Our reported results for the second quarter of 2026 reflect the strategies underway to drive profitable growth. Total revenue was $18.5 million compared to $7.8 million in the prior year period. The 137% year-over-year increase was primarily driven by the acquisitions of Qlik and TubeBuddy, as well as growth across our marketing agency and owned and operated IP operating segments. The reported gross margin for the 2026 second quarter was $9.0 million, or 49% of sales, compared to $2.3 million, or 29.4% of sales for the same period last year. The significant increase in gross margin reflects a mix of higher margin sales and our ongoing focus on profitability. Adjusted EBITDA for the 2026 second quarter was positive $1.0 million compared to an adjusted EBITDA loss of $3.2 million for the same period last year. The $4.2 million improvement reflects a combination of revenue growth, higher blended gross margin, and greater leverage on fixed operating expenses. As of June 30, 2026, we had cash and cash equivalents in digital asset treasury assets of $25.9 million. I'm pleased with the progress we are making in growing sales and improving profitability. GameSquare has a strong financial position and liquidity to pursue strategic initiatives, invest in our operating platform and return capital to shareholders. So with this overview, I'll turn the call back over to Justin.

Thanks, Mark. Based on the momentum we see across the platform, our confidence remains strong and we're encouraged by how 2026 is shaping up. On a pro forma basis, which reflects our plans for the TubeBuddy business, we are reiterating our previously announced annual guidance for fiscal year 2026. We expect revenue in the range of 85 to 90 million, with gross margin of 35 to 40%, and adjusted EBITDA of over $5 million. Our outlook reflects continued organic growth and improving year-over-year profitability. With the structural efficiencies we've implemented and the operating discipline now embedded across the organisation, we believe that we are well positioned to scale profitability as the business grows. Our focus remains on executing against our booked pipeline, converting growth into sustained, positive, adjusted EBITDA, and importantly, cash flow, and allocating capital toward the opportunities we believe offer the highest returns for shareholders. So with this overview, Mike and I are happy to take your questions. Operator, please open the call to questions.

Thank you. We will now begin the analyst question and answer session. To join the question queue, you may press star then one on your telephone keypad. You will hear a tone acknowledging your request. If you're using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star, then two. The first question comes from Jack Vanderaarde with Axon Group. Please go ahead.

Okay, great. Good evening, Justin and Mike. Congrats on the strong growth and outlook. Good to see the momentum continuing. So I guess, Justin, the guidance that you've reiterated implies an even stronger growth ramp in the back half of the year, which is seasonally normal. But still very strong. Can you maybe, you touched on some examples. There's quite a few examples that are driving this that you're excited about. But maybe just, can you speak to the pipeline in any key industry catalysts that maybe support that implied growth ramp? You touched on Marvel Rivals and Tencent and Roblox and GTA 6 launching, I believe, in November. We'd love to hear your thoughts in more specific catalysts.

Yeah, for sure. Thanks for that Jack and you also part answered your own question so I also appreciate that but you know I think that as you sort of mentioned you know that's sort of historically been you know I wouldn't say that quarter on quarter there's enormous seasonality in our business but you know historically back half of year being a little stronger than first half of the year has proven to be the case year on year and you know part of that is that There's more live events and esports tournaments. You have a holiday season with merchant consumer products. You know, you have sort of that flow-on effect of, you know, these branded ad budgets where you get those sort of late, you know, dollars in the year that kind of open up with those budgets and last-minute sort of scramble dollars. So we've really seen that across the board year on year, so we're really confident there. But most importantly, I think, and, you know, sort of internally, we've got more revenue locked in than ever before, right? So we've got retainer relationships. You know, we mentioned sort of those AOR relationships that, you know, we have such a high retention rate on, which I think is just, you know, such a huge shout out to our team and the incredible work that they do and execute on is that, you know, we don't lose clients and we often say that. You know, I think that's proof of that. But, you know, Dairy Max, Jack in the Box, Roblox, Rekt, Azuki, you know, all of these. So having a really nice layer of recurring revenue locked in gives us great confidence. You know, we touched on sort of Marvel Rivals and the incredible work that the team did there. And there's a much larger opportunity in December there with the finals, which we're sort of working toward. You know, at the moment, we've got multiple events at Roblox. and the list goes on. So, yeah, we've got great visibility into the back half of the year. I think there's some opportunities certainly for outsized growth beyond our guidance. But, you know, we want to stay conservative and beat our numbers and continue to do so. And I think, you know, we proved that out in Q2 and we're confident we'll be able to do that in the back half of the year. So, yeah, I hope that answers your question. I think there's certainly macro factors, but, you know, beyond macro factors, We're just really confident in the way we've been able to execute the visibility we've got on the rest of the year and our ability to get our hands on more IP. We're being trusted by these world-class publishers and IP owners to go and execute against IP, and I think that's an area of growth you'll certainly see is our ability to bring IP in-house and monetize it.

Excellent. That's great color, Justin. Maybe just two more quick questions. As a follow-up, maybe you talked about the pipeline, how that's in revenue being locked in. Can you maybe just touch on our deal sizes, average deal sizes, are there synergies between, I guess, some of the businesses that you've acquired and integrated now as well? Just touch on kind of just the, I guess, the evolution of your average deal sizes and sort of that visibility in the pipeline.

Yeah, for sure. Great question. Average deal size has absolutely increased and something that we monitor internally and we can start to track and include in these calls as well. So I think it's a good point and gives great visibility into the progress so we can provide some more clarity there as a KPI moving forward. But yeah, I think what's really pleasing and you kind of touched on it there, Jack, is our ability to integrate into the GameSquare ecosystem. So being able to bring Click will double revenue this year by being part of the Gamesquare ecosystem. We've been able to sign massive US talent. We're now looking at lifestyle and athlete talent. Obviously, there's huge benefits on the Gamesquare front by bringing Click in, but equally, I think the Click team is just seeing this enormous pipeline of activity that's generated from Gamesquare. That really is great evidence of Our ecosystem working, right? And so these bigger names that we talk about, you know, Epic Games with Fortnite, Roblox, the Creator Showdown, a piece of IP that we created, Marvel Rivals. These are great examples of the GameSquare ecosystem working, right? This isn't just, you know, hats off to our agency team, which, you know, hats off to our agency team, but they're partnering with Our data business, right? So we can measure absolutely everything we do. Integrating in creators from Qlik. Executing with our own production team. Overlaying with our own media and that is the GameSquare ecosystem working. So that's really pleasing to see, right? It's not that we're getting outsized growth from any one area. It's that the GameSquare ecosystem is working. We're upselling, we're cross-selling, we're working as a team, and I think everybody within our four walls understands that. That's how we're going to win, and that's how we are winning. So, yeah, really pleased to see that. Can certainly provide more information around average deal size, you know, by segment and overall blended by game square, but it's certainly increasing. You know, we're a bit more selective now, Jack, with some of the work that we're taking on. You know, three, four years ago, we would... you know be out there sort of fighting for RFPs and taking on you know any client work where we are selective now with the work that we do we're targeting bigger projects and you know we want to be more strategic with our clients which ultimately delivers better results for them and you know helps us expand our margins.

Excellent color. Just one more quick one. I appreciate your comments earlier about the capital allocation Yeah, so I think sort of two parts to that. One, on the capital allocation piece,

If anyone of you missed it, we have started liquidating some of our ETH. We do still have a large holding, which you can see in the press release. I think the reality for us is that we're extremely undervalued. We do feel bullish about the news that we've got coming, the results that we're proving out. And so we are certainly hopeful that we're going to start to get reward for effort. But like I mentioned last time, We are willing to take that into our own hands and continue to liquidate further and buy additional shares back. So I'm sure that's something that you will see in conjunction. We've got a very healthy balance there. But the priority is our operating business. We've said that from day one. We're proving that out. And so I think people will continue to see that. And certainly from the feedback I'm getting, many shareholders will be happy to hear that. M&A you know sort of similar story Jack obviously can't share too much I would say that we are actively looking at you know a couple of interesting acquisitions that can help get us to scale like always I'd say we're extremely cognizant of dilution so you know we only approach these conversations from a relative value standpoint we know how undervalued we are we are not going to go and You know, acquire an entity for, you know, headline value, right? It would need to be relative value, understanding that, you know, we are undervalued and this is a one plus one equals five situation. In saying that, you know, I think there are, we're a very attractive buyer. You know, I think we've got a great name in our space. We're getting more and more market share. You know, obviously having access to capital markets, a clean balance sheet, clean cap table and a great board. and many more. or continuing to partner with IP holders and owners and some of which we've announced recently. So, you know, I'd say certainly active in that space, Jack, constantly looking at ways to get better, cognizant of dilution, but, you know, really want to get to scale. So, you know, I certainly would sort of think about it from that aspect and certainly from an aspect that we would only consider accretive deals, you know, nothing that's burning cash, We really went close here to starting to generate quarter-on-quarter cash for shareholders. That's really where we want to get to and get to quickly.

Okay, excellent. Well, I appreciate the time and wish you the best of luck going forward. Thanks.

The next question comes from Greg Gibbous with Northland Securities. Please go ahead.

Hey, good afternoon, Justin and Mike. Congrats on the results and the nice profitability. Appreciate your commentary on share purchases and just how you view the stock. Wanted to maybe follow up on guidance, on the other hand, as it relates to what's maybe changed since you last reported and how you're kind of in terms of the growth pipeline that is and perhaps how you're viewing Q3 versus Q4 cadence.

Yeah, Greg, I would say that we're more confident in guidance today and certainly in our pipeline than we've been at any point from the time of Coming out with guidance, you know, to today, we're extremely confident in achieving and exceeding guidance. I think that, you know, there was a conversation around, you know, increasing guidance, but we want to stay on the conservative side of things and beat our number. As you all know, Q2 is ahead of target, right? We're kind of ahead of Thank you for joining us. Yeah, extremely comfortable in sort of how things are tracking. Back half of the year shaping up, you know, really, it's going to be really healthy. So, you know, I would think of Q4 as historically it's been our largest quarter and there's a number of sort of large projects that will, you know, they may sort of show the line of Q3 and Q4, but we'll probably live in Q4. I would expect Q4 to be the largest quarter of the year. But, you know, kind of holding firm on the fact that the back half of the year is sort of 60%, front half 40%. I think you start to think about that operating leverage, right? I don't think you're not going to see, you know, much of an increase, if any, you know, from an OPEX standpoint. In the Q3 and Q4, in comparison to Q2, I think that's kind of a pretty good way to think about our OPEX. There may be some slight fluctuations, but it's not going to be material. So, you know, I think we start to get a bit of operating leverage, you get a bit of growth in revenue. So certainly 60-40 back half of the year, and I would expect Q4 to be larger than Q3.

Great. Understood. That's very helpful. Appreciate the color, Justin. And, you know, along the lines of kind of what you spoke to is being very comfortable with, you know, I guess locked in or more recurring revenue. You know, are you able to maybe – provide an idea of kind of what within guidance is implied, or sorry, what is more recurring revenue implied by guidance, like how much is kind of reflected there versus what's more variable?

Yeah, it obviously fluctuates based off entity. I'd say from a blended margin standpoint, were probably around 70% of books locked in revenue. And that 30%, I'd say, our pipeline would suggest that we'll sort of far exceed that. But I think that if you looked at this two, three years ago, we'd probably be around 30%. So I think that has been a huge improvement and increase for us going to... Having such a large amount of revenue locked in as we sit here today, early, mid Q3, knowing a lot of what our Q4 looks like. Now, there are some bigger programs, some upside, some pipeline. There's things that always can come in last minute, but obviously pleasing to know that if nothing additional or new was to come into the business, There's a large amount of sort of revenue that already exists that we're, you know, well on the way to kind of hitting that target. And that's, you know, that's a combination of, I think, the incredible work that our agency business does, you know, specifically kind of that retainer agency of record portion of that, you know, in addition to some of these acquisitions, right, with Click, you know, obviously Stream Hatch has always had sort of really high retention, but, you know, obviously also now bringing in True Buddy for its first quarter, which, you know, also should mention, you know, as you kind of look at the numbers and dissect, you know, big ticks from revenue, OpEx has probably gone up a little bit because you've got the full quarter of True Buddy, but relatively this is a margin play, like our margin expanded, you know, a in Q2, and that's, you know, from the SaaS business, that's close to 90% margin, or it's 88% margin. So, yeah, it's a few factors, but certainly really pleasing.

That's great to hear. Thanks again, and I'll pass it on.

This concludes the question and answer session. I would like to turn the conference back over to Justin Kenna for any closing remarks. Please go ahead.

Thanks everyone for joining today's call. I'll keep this short and sharp. I'm sure you've heard enough from me today. We appreciate the continued support. Hopefully our results reflect the incredible progress that we're making. We're ahead of target halfway through the year. Pipeline's increasing. We're building meaningful long-term strategic relationships with world-class game publishers and clients. and we expect that to continue. So, you know, again, elephant in the room is the share price. We're undervalued. We know that. We feel really bullish. And again, you know, we talked about the capital allocation strategy. We'll continue to look to allocate capital to buy back our stock until we break the back there. And, you know, I think that our focus is on long-term shareholder value and, you know, we're going to get there.

So,

Thank you again for the support.

And we're really looking forward to catching up and providing progress on Q3.

And I'm sure you'll see and hear plenty of news from us between now and then. So thanks to everyone. Cheers.

This brings to a close GameSquare's 2026 second quarter financial results conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.