LiveOne, Inc. Q3 FY2026 earnings call

• Delivered over $58 million in revenues for the 9 months, including $20 million in Q3, with adjusted EBITDA expanding. Operating expenses reduced by over 52% year-over-year; organization streamlined from 350 to 88 team members using AI. - Strengthened balance sheet by paying off over $2.5 million of debt. - Audio Division had $52.2 million in 9-month revenue and over $3.7 million in adjusted EBITDA. - B2B pipeline is largest in company history, up over 30% in 120 days with over 100 active enterprise opportunities. - Launching 3 major Fortune 500 partnerships across national retailer, leading TV platform, and major carrier. - Converting over 1 million free and ad-supported subscribers to monetized tiers. - Inbound M&A opportunities increasing; sold fourth television series to major streaming platform with 100% margin economics. - Live experience market reaccelerating; focus on owning own products with database exceeding 65 million consumers. - Evolving leadership structure, plan to announce new President to focus on B2B partnerships, M&A, and AI initiatives. - Expanding share repurchase program with approximately $6 million remaining.

The Audio Division generated $52.2 million in 9-month revenue and over $3.7 million in adjusted EBITDA. PodcastOne subsidiary posted record revenue of $15.9 million and adjusted EBITDA of $2.8 million in Q3. Slacker subsidiary reported Q3 revenue of $2.8 million and adjusted EBITDA of negative $0.1 million. Consolidated revenue for the 3-month period ended December 31, 2025, was $20.3 million, and consolidated adjusted EBITDA for the second quarter of fiscal year 2026 was a positive $1.6 million.

• Preliminary fiscal guidance for fiscal 2027: $85 million to $95 million in revenues and $8 million to $10 million in adjusted EBITDA. - Expecting transformational growth in fiscal 2027.

• Risks associated with forward-looking statements where actual results may differ. - Competition from other media and tech companies entering audio and B2B spaces. - Dependence on successful execution of B2B partnerships and conversion of free subscribers to paid.

Q: Elaborate on B2B customization using AI and potential risk of music streaming companies entering B2B space.

A: B2B deals are customized, hard for others to replicate, and competitors are partners, with unique position due to low price, nimbleness, and white-label capability.

Q: Status of ad revenue from Slacker ad-supported customers.

A: Adding advertising, partnered with DAX, raised ARPUs by over 30%, with potential to convert free subscribers to paid.

Q: Competitive landscape for providing content to brands.

A: Uniquely positioned, hard for others to replicate due to infrastructure, licensing, and complexity.

Q: Timing and details of B2B partnerships with over 50 million subscribers.

A: Partnerships are being launched, already signed, with pipeline increasing.

Q: Ramping of 3 massive B2B partnerships and inclusion in guidance.

A: Guidance is conservative, with partnerships ramping up towards year-end.

Q: Conversion of Tesla users from ad-supported to paid.

A: Seeing conversion, with year-long subscriptions helping strengthen balance sheet and expecting more growth.

Q: Timing of 10-Qs, sustainability of costs, depreciation, stock-based comp.

A: 10-Qs out tomorrow, G&A and sales/marketing costs expected to decrease, depreciation and amortization leveling, stock-based comp similar levels with potential increase.

Q: Revenue from 30 million subscriber B2B deal in guidance.

A: Guidance is conservative, with revenue from deals being baseline and potential to increase.