COMSCORE, INC. Q3 FY2026 earnings call

• ROI Strategy Execution: The company is executing its 'Realignment, Optimization, and Investment' strategy launched in August. Initial progress includes an 8% reduction in core operating expenses and completion of majority planned headcount reductions, yielding over $20 million in annual run-rate savings.
• Strategic Discardments: ComScore declined a new international measurement opportunity due to unfavorable economics and geographic priorities, signaling a shift toward high-quality, scalable work over mere revenue acquisition.
• Optimization Initiatives: Efforts include renegotiating data contracts (securing mid-seven-figure savings for 2027), sunsetting legacy activities like on-demand, and strengthening commercial discipline to focus on scalable, reusable products rather than bespoke solutions.
• Growth Investments: Advancing AI-informed audience segments, with pilot clients reporting 38% better performance than third-party data. Also expanding creator measurement tools for top creators and pursuing strategic commitments in local TV advertising.

Total revenue for the third quarter was $76.2 million, a decrease of 14.3% year-over-year (YoY). On a pro forma basis, excluding the divested movies business, total revenue declined 4.1% to $76.2 million from $79.4 million in Q3 2025. Content and Ad Measurement revenue was $64.6 million (down 14.4% YoY; down 2.1% pro forma), driven by declines in syndicated audience offerings. Syndicated Audience revenue specifically fell 17% to $52.4 million due to the movies divestiture and lower digital renewals. Cross-platform revenue remained flat at $12.2 million, with growth in new business offsetting lower usage of proximate products. Research and Insight Solutions revenue decreased 13.9% to $11.5 million due to lower renewals and timing of custom deliveries.

• Full-year 2026 Revenue: Maintained at $315 million to $325 million.
• Full-year 2026 Adjusted EBITDA Margin: Maintained in the low to mid single digits.
• Annual Run-Rate Savings: On track to achieve $20 million to $25 million in cost savings from the realignment plan.
• Cash Flow Goal: Targeting cash flow positivity from ongoing operations by the end of 2027.

• Liquidity Constraints: Cash and equivalents dropped to $19.5 million as of September 30, 2026. The company is evaluating options for working capital flexibility to support short-term strategy execution.
• EBITDA Decline: Adjusted EBITDA fell 47.3% to $5.8 million due to the divestiture of the profitable movies business and restructuring costs.
• Goodwill Impairment: A non-cash goodwill impairment charge of $57.3 million was recorded, driven by the realignment plan and declining stock price.
• Secular Declines: Certain segments, such as linear TV and some cross-platform areas, face secular declines due to changing consumer behavior and platform shutdowns.

Q: Jason Cryer asked about the company's perspective on what is working or not, and the path to return to growth after nearly six months into the turnaround. / A: Matt McLaughlin stated that actions are well-received and pointed in the right direction. He emphasized that returning to growth requires stabilizing segments facing secular decline (like linear TV) while investing in scalable opportunities aligned with evolving consumer behavior, particularly in AI and creator metrics.

Q: Jason Cryer inquired about the volatility in the Cross-Platform segment and the strategy to optimize it following recent challenges. / A: McLaughlin attributed the volatility to platform shutdowns, shifts in open web advertising dynamics, and the need for a more focused product strategy. He noted that the commercial organization is being reoriented to maximize utilization of highest-leverage products on key platforms, with changes rolling out in coming quarters.

Q: Jason Cryer asked if historical seasonality (Q4 uptick) would continue this year, noting it wasn't fully reflected in the guidance range. / A: CFO Mary Margaret confirmed that similar seasonality is expected. This is driven by volume-based activation products benefiting from holiday ad spending ramps and a high volume of contract renewals in Q4, which provide both in-quarter revenue impact and set the stage for next year.