Please note this conference is being recorded. Before we begin, I'd like to caution listeners that comments made by management during this call may include forward-looking statements within the meaning of applicable securities laws. These statements involve material risks and uncertainties, and actual results could differ from those projected in any forward-looking statements due to numerous factors. For description of these factors, For a description of these risks and uncertainties, please see Super League's financial statements and MD&A for the second quarter of 2026, ended June 30th, 2026, available on EDGAR. Important qualifications regarding forward-looking statements are also contained in Super League's earnings release distributed earlier this morning and also available on EDGAR. Furthermore, the content of this conference call contains time-sensitive information, accurate only as of today, August 14th, 2026. Super League undertakes no obligation to revise or otherwise update any statements to reflect events or circumstances after the date of this call. I would now like to turn the conference call over to Matt Edelman, President and Chief Executive Officer. Matt, please go ahead.

Good morning, and thank you for joining us. I'm pleased to share our financial results and business updates for the second quarter of 2026. Thank you for joining us. Gross revenue was approximately $3 million, essentially flat both year-over-year and sequentially, and generally in line with analyst expectations. While we are not satisfied with flat revenue, we believe the stability of our top line demonstrates resilience and a quarter when advertising budgets and brand priorities were affected by several macro factors, including significant spending around the World Cup, uncertainty surrounding tariffs and geopolitical events such as the Iran War, as well as evolving Roblox policies affecting certain brand activations. More importantly, we continue to make progress beneath the top line in areas critical to the health and scalability of the business. Net revenue increased 16% sequentially to approximately $1.24 million from $1.08 million in the first quarter, despite gross revenue remaining essentially flat. Gross margin improved to 41%, up from 36% in Q1. adjusted EBITDA improved approximately 20% year-over-year to a loss of approximately $1.7 million compared with a loss of approximately $2.1 million in the prior year quarter. On a sequential basis, our pro forma cash basis operating performance also continued to improve. These results reflect our ongoing focus on the quality of our revenue, operational efficiency, and discipline management of our cost structure. One example is the progress we are making in implementation team utilization. During the second quarter, the percentage of our cost of goods related team capacity dedicated to billable client activity increased approximately 30% relative to Q1. Our focus is ensuring the resources we have in place are deployed efficiently against revenue generating work. That discipline has extended to the integration of the Misfits Ads assets acquired in May of this year. We completed the acquisition early in the second quarter and successfully integrated the Misfits team without increasing Super League's overall cost base. In fact, total company headcount today remains below where it was prior to the acquisition. Just as importantly, Misfits has brought more than technology and incremental capabilities to Super League. The team has added strong commercial energy, an attractive pipeline of opportunities, and further reinforced our culture of creativity, execution, and accountability. The acquisition has also expanded the breadth of what we can offer to our brand partners. We now have programmatic advertising and turnkey media solutions that are lower lift operationally, generally higher margin, and have the potential to become more predictable sources of revenue. In that regard, we recently launched a youth and family marketplace, giving advertisers a single point of access to kid-safe media within gaming channels that can be accessed programmatically by buyers or through our managed services team. These capabilities represent the intentional revenue diversification that inspired the Misfits transaction and already allow us to address a broader range of advertiser objectives across gaming and digital media. We are seeing encouraging signals from our broader commercial organization as well. Weighted pipeline per seller as of the end of Q2 increased to approximately 2.8 million, up from approximately 1.78 million when we reported our first quarter results. Win rates with clients are also improving, and our renewal business remains strong. Recent examples include the USGA, Logitech, GoGo Squeeze, and Regal Cinemas. Our success with these and a growing number of partners is rooted in how we establish their entry into the gaming landscape. We create a presence they can build upon. A starting point becomes a proof point, and a proof point becomes an opportunity we can expand. We also closed six first-time clients during the second quarter and third quarter to date. One recent example is Dodge, which selected Super League as its inaugural partner for a program within Fortnite. Thank you for joining us. Our client solutions have become both broader and more precise. We are more equipped than ever in our history to demystify the fragmented gaming landscape by designing cross-channel programs that optimize advertiser outcomes and deploying our play intelligence engine powered by psychographic insights, AI insights through our partnership with Solstin. Supporting all of this is a meaningful upgrade to our commercial organization. Beginning late in the second quarter, we substantially rebuilt our revenue team under the leadership of a new executive vice president of revenue, Anthony Alexander. Anthony brings approximately 15 years of senior revenue leadership experience in gaming media, including deep expertise in programmatic advertising, data-driven sales strategies, and building teams capable of scaling revenue. We also have added experienced sellers in Los Angeles, New York, and Chicago, strengthening our presence across three important markets. And as mentioned a few moments ago, we have made these moves while maintaining a largely flat cost structure. The early indicators are encouraging. We are receiving more RFPs week after week, and we believe we now have a much stronger team in place to convert those opportunities into revenue. Our financial position also remains an important source of strength. We ended the second quarter with approximately $6.7 million in cash and investments compared with approximately $475,000 at June 30 of last year. Additionally, we continued simplifying our capitalization structure during the quarter. For the first time in several years, Super League no longer has any preferred stock outstanding. Thank you for joining us. as we look toward the remainder of 2026, our priorities are straightforward. First, convert the growing commercial pipeline into revenue. Second, continue improving the quality and margin profile of that revenue. Third, maintain the cost discipline and operating leverage necessary to translate revenue growth into improved financial performance. And fourth, continue integrating and taking advantage of the capabilities we have added through the Misfits Ads assets and the investments we have made across the business. We remain focused on achieving adjusted EBITDA profitability in the fourth quarter and believe the gains we are seeing in margin, operating efficiency, and commercial activity continue to support that objective. We also continue to follow developments within the digital asset sector. Our approach remains measured and disciplined, and we will explore opportunities when we believe they can create meaningful value for shareholders. We entered 2026 saying the focus had shifted from stabilization to execution. halfway through the year, that is exactly where our attention remains. We have more work to do, particularly in translating the commercial momentum we are building into sustained revenue growth. But we believe the underlying business is getting stronger, our capabilities are broader, our financial foundation is healthier, and our organization is increasingly positioned to deliver the operating leverage we have been working toward. Thank you. With that, I'll turn it back to the operator for Q&A.

Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for your questions. Our first questions come from the line of James Kisner with Water Tower Research. Please proceed with your questions.

Thanks for taking my question. So this weighted pipeline per seller jumping 57% seems quite a bit. What's behind that step up? How much of that from the new sales leadership versus the broader product set?

Thanks, James. Nice to talk to you. I think it's really three things you talked about, two of them. One, the leadership has really come in and opened up a lot of new opportunities. Two, we do have a broader product set, and that has given us a chance to speak with more potential brand partners about more opportunities. and then three, we did inherit through the transaction with Misfits an attractive pipeline that brought in a higher volume of opportunity.

That's helpful. So nice to see you kind of reaffirm this target of adjusting without profitability in Q4. What kind of gets you there? Is it just revenue conversion from the pipeline, or is it further margin gains, cost discipline, all of the above? What's the roadmap?

Thank you so much for joining us. and so really it is converting the volume of opportunities and the broader product set and relying upon the upgraded sales and strategy teams to deliver revenue based on the opportunities we've brought in.

Great. That's helpful. And I was hoping maybe you could provide an update on the kind of CTV advertising inventory, you know, partnership, you know, where that stands and when am I going to show up in pipeline or revenue?

It's an important question. There is a fair amount of exciting standard media inventory as well as custom advertising opportunities that we are able to bring our partners inside that application. It is becoming a real highly desirable feature in many programs, especially with a number of streamers and entertainment applications that companies want people to download and use on their connected TVs. So there's a nice tune-in opportunity by appealing to gamers and really only being one click away from getting to content.

Thank you for taking my questions.

Thank you very much.

Thank you. Our next question has come from the line of Rommel Dionisio with Aegis Capital. Please proceed with your questions.

Good morning. Thank you. Ned, in your comments, you talked about the misfits, the integration misfits leading to a more predictable or I think recurring revenue stream. Could you walk us through the thought process on that? I understand, obviously, the cross-selling synergies, but how do you think about, you know, The stickiness of your client base going forward, could you walk us through how that would translate to a more recurring or predictable revenue stream? And maybe if you can add an anecdote or two about if you've had success with that in the past. Thank you.

Yes, sure, absolutely. So I think the word predictable is a better word than recurring because it is not similar to sort of a subscription or business of that nature. But the opportunity with programmatic advertising solutions is huge. Thank you so much for having me. on a number of rounds of discussions, that inventory can be purchased either by the buyer or by our team on behalf of the buyer very easily and the budget can be set or changed in any given day. and so on. We did acquire a handful of partnerships that are using that inventory and we are expanding the breadth of that inventory and the applicability of that inventory to a wider range of brands. And we do expect programmatic buying and managed services buying of the programmatic inventory to become a very healthy source of revenue going forward.

Okay, thanks very much, Matt. That's very helpful.

Thank you, Rommel.

Thank you. Our next question has come from the line of Jack Cordero with Maxim Group. Please proceed with your questions.

Hi, thanks for taking my questions. Given the kind of industry environment, do you have any commentary on specific channels you're starting to see improve, whether it's your kind of mobile segment or CTV channels? Do you have any expectations for these or maybe at a high level, any kind of targets for these to contribute as like a major percentage of revenue?

Justin Stefanovic, Anthony Alexander, Clayton Haynes, Matthew Evan Edelman Thank you so much for having me. that buyers are trusting our expertise and looking at us as a single point solution to help them optimize a program across mobile, which could be combined with Roblox, which could be combined with CTV, which could be combined with web games, which could be combined with influencers on YouTube. for the purposes of reaching gamers that match their audience and deliver against the marketing outcomes they desire. And so instead of pitching specific products like we have in the past. We're actually pitching to reach a specific audience. And so we really do think that our offerings across the board are going to sort of rise in concert because in any given campaign, it may be one or another product or channel that is the most important to activate.

Okay, yeah, that's super helpful. And then I just had one more follow-up. Given commentary about being smart about costs, do you expect the OPEX levels, is this a go-forward baseline, or do you expect any flex? I think in the quarter, the gap OPEX is, call it, $5 million. Is that kind of the new baseline, or do you expect that to kind of go down a little bit as well?

We never stop looking for ways to reduce OpEx. We think we're probably close to the baseline. The primary area where we have an opportunity to perhaps find a little bit more efficiency is as our volume of Thank you very much. Thank you for taking my questions. Thank you.

Thank you. We have reached the end of the question and answer session. And with that, I would like to hand the call back over to Matt Edelman for any closing comments.

Thank you again, everyone, for your time and for your questions. Stepping back, I think the second quarter is best understood as a quarter of resilience and continued operating progress. Revenue remained stable despite a challenging advertising environment. Net revenue and gross margin improved sequentially. Adjusted EBITDA improved year over year. We integrated the Misfits Ads assets without increasing our overall cost base. We rebuilt and strengthened our commercial organization, and we maintained a strong liquidity position while continuing to simplify our capital structure. As we move through the second half of 2026, our priorities remain clear, converting a growing pipeline into revenue, continuing to improve the economics of the business, maintaining financial discipline, and executing against our path toward profitability. We believe the work completed over the past quarters has created a strong foundation for Super League. The opportunity now is to translate that stronger foundation into sustained financial improvement. We look forward to updating you on our progress next quarter. Have a great Friday.

Ladies and gentlemen, thank you so much. This does now conclude today's teleconference. We appreciate your participation. May disconnect your lines at this time. and enjoy the rest of your day.