Good afternoon and welcome to the Newsmax 3rd Quarter 2026 Earnings Conference Call. At this time, all participants are in a listen-only mode and we will open the floor for your questions after the presentation. If you wish to join the queue to ask a question at any time, you can press star 1. Should you wish to remove yourself from queue, press star 2. It is now my pleasure to turn the floor over to your host, Chris O'Day, Investor Relations. The floor is yours.

Good afternoon and welcome to Newsmax's third quarter 2026 earnings conference call. I'm joined today by Chris Ruddy, Chief Executive Officer, and Darryl Burnham, Chief Financial Officer. On this call, Chris and Darryl will provide prepared remarks on the most recent quarter. We will then take questions from the investment community. A recording of this conference call will be available on our Investor Relations website shortly after the call has ended. Please note that this call may include forward-looking statements regarding Newsmax's financial performance and operating results. These statements are based on management's current expectations. Actual results could differ from what is stated due to certain factors identified on today's call and in the company's SEC filings. Additionally, this call will include certain non-GAAP financial measures. Reconciliations of these measures are included in the earnings release and our SEC filings, which are available in the Investor Relations section of our website. I will now turn the call over to Chris Ruddy, Chief Executive Officer of Newsmax. Chris?

Thank you, Chris, and welcome everyone to our third quarter 2026 earnings call. The third quarter was the strongest in our history as a public company, excluding a one-time payment, which Darryl will cover in detail. Revenue grew 21.6% to a record $55 million, and adjusted EBITDA was $5 million. That is our highest quarterly revenue and our fastest growth rate since our listing, and it was our second consecutive adjusted EBITDA positive quarter. The quality of our growth was on full display relative to the overall cycle. We are at the midpoint of the presidential election cycle when cable news audiences and national advertising demand are generally well below their peak. Even in that environment, affiliate fees and licensing, two areas we expected to carry our growth this year, did exactly that. Affiliate agreements are renewing at higher rates, licensing is taking the Newsmax brand globally and on leading AI platforms as news consumption diversifies. In every one of these markets, there is real demand for independent, common sense journalism, and we are positioned to deliver it. Affiliate fees rose 77% to $14.3 million. Newsmax is a relatively new entrant to affiliate fees. As our agreements come up for renewal, they are repricing at rates that reflect our reach and ratings today. These are multi-year agreements, so each renewal sets a higher base for the years ahead. In addition to renewals, we continue to gain traction in the quarter. We added six new Newsmax affiliates, each as an independent cable operator. These are smaller agreements, but each one increases our reach. Even as viewing shifts across platforms, linear news still has a strong place. We are well positioned to keep that presence, and it introduces viewers to everything else we offer. We also launched on AFNOW, the streaming service of the American Forces Network, bringing Newsmax to service members and their families stationed overseas. We also agreed to acquire two radio stations in Miami, Adding a historic South Florida broadcast brand to the places where people can find Newsmax. Our second growth engine is brand and international licensing, our fastest growing revenue stream. Licensing revenue was up 343% year over year as the agreements we expanded earlier this year flowed through our results. We are on track for approximately $16 million in international licensing fees this year, all of it under agreements already signed. We estimate annualized licensing revenues of approximately $25 million next year. Our footprint is also growing. Newsmax Ukraine launched on November 1st and in October we were pleased to receive the Special Recognition Award from the Royal Television Society in the UK for our role in helping our partners build out the Newsmax Ukraine studios during wartime. Our licensing partners are also preparing Newsmax for additional countries in Europe. We will have additional details for our shareholders in the future. We are also proud to announce that Newsmax is now available on all major paid TV platforms in Israel. And Newsmax en Español is now on three streaming distributors in the United States with more to come. These are true partnerships built in a capital efficient way and serving underserved audiences around the world. Advertising held up well. Cable advertising revenue grew 3% year over year in a soft market. It has consistently run ahead of what our ratings alone would suggest, because advertisers value a loyal and engaged audience that watches news live. Our audience is the reason the 2024 election brought millions of new viewers to Newsmax, and they have stayed with us. Through the first nine months of this year, we reached nearly 49 million viewers. in line with the same period of the 2024 election and up 42% from 2023. We are the fourth highest rated cable news channel, ranked number two in the category for engagement among adults 35 to 64, and remain the fastest growing basic cable network since Nielsen began measuring us in 2020. Our viewers are highly engaged, spending an average of 25 minutes per tune in, up from 14 minutes in 2020.

They're also loyal.

Thank you for watching. The way people find news is not standing still and neither are we. News consumption is diversifying across cable, OTT, streaming, social, and now AI. Newsmax is on all platforms for all people. Our social total followers rose 13% year over year to 26.8 million at the end of the quarter and our followers are highly engaged. We generated 44 million interactions in the third quarter, up 4% from the second quarter on less content. And on Facebook, we ranked first among news publishers in interactions per follower. Newsmax 2, our free streaming channel, has carried on almost all the major free streaming platforms. Today, N2 broadcasts over the air in digital channels in 131 markets, reaching approximately 87% of U.S. TV households. As our presence grows, so does our ability to monetize it. And we are taking more control of the advertising opportunity on N2, Newsmax 2, in the quarters to come. Turning to Newsmax Plus, our paid streaming platform, we are seeing high engagement. The people who use the app are spending more time with it, and average engagement time per account rose 19% year over year in the third quarter. The catalog for Newsmax Plus now holds more than 700 licensed and original documentaries and specials and we keep adding originals and additional programming. Subscription revenue is still an area we are building and we are investing in programming, talent, and content to make sure our marketing efforts satisfy customer demands for the app and its services. We have also brought in outside firms to expand that effort and grow subscribers. Rising engagement is the foundation for turning that catalog into subscriber growth. As we bring more people to the Newsmax brand across our platforms, we expect more of them to become Newsmax Plus subscribers. Social streaming AI. Wherever the audience goes, Newsmax will be there. You will note Newsmax saw some declines in our print magazine subscription base, as well as our legacy business of paid subscription health and financial newsletters. and many more. We have also grown our online news sharing with Yahoo News, MSN, Smart News, Apple and Google. We see AI as having a particularly strong potential benefit in terms of reach and revenues, and I hope to see some developments in the coming year. And the cycle is turning. As a reminder, advertising for midterm races for Congress and state and local elections primarily goes towards local broadcast stations, local cable and pay TV operators, and local digital. Newsmax is a national cable news network, so a relatively small amount of that spending comes our way. What we gain is engagement and new viewers. This was a heated midterm race, and as we saw after 2024, the viewers it brings to Newsmax tend to remain with us. It is also a precursor of what is to come. Political ad spending for these midterms was projected at $11.6 billion, according to Ad Impact, more than the total spend in the 2024 presidential cycle. Looking ahead to 2028, we believe the presidential race, coupled with federal and state races, will only amplify the money spent. Newsmax expects to benefit more in terms of advertising during the 2028 cycle. The presidential race begins in earnest in 2027 with the first primary debates expected to take place in the summer of 2027. It is an open race for the White House, with no incumbent and an expected crowded field in both parties. Our cable channel Newsmax reached 58 million total viewers in 2025 with no national election, and we have only widened our presence across platforms since. We intend to build on that in the year ahead as the 2028 presidential election heats up, providing a trusted outlet for the underserved, independent, and center-right markets. Looking ahead, we continue to expect our growth to be structural, not cyclical, led by affiliate fee expansion and international licensing. Darryle will walk through our full year outlook in his remarks. Let me close, as I always do, with the big picture. Few media companies can reach this audience with the scale, credibility, and multi-platform presence of Newsmax. We see a two-year window into the 2028 cycle and we are entering it from a position of strength. Record revenue, a second consecutive profitable quarter, a loyal audience across cable, streaming, and digital. We are excited about the journey ahead and we will continue to invest behind growth. To our readers, our viewers, our advertisers, and our shareholders, thank you. With that, I will turn it over to our Chief Financial Officer, Darryl Burnham, to walk through the financials. Darryl?

Thank you, Chris, and thank you everyone for joining us today. As Chris highlighted, we delivered record underlying revenues in our second consecutive quarter of positive adjusted EBITDA. Before getting into the numbers, we want to touch on two items that affect how this quarter reads. First, the one-time item Chris mentioned, During the third quarter, we recognized $14 million in connection with an amendment to an advertising purchase agreement with a customer, which modified the party's remaining rights and obligations. The amount is non-recurring. It is presented as a new service revenue termination fee line within our broadcast segment, so our advertising revenue does not include it. Where it matters, we will give our results, both with and without it. Our digital segment now includes a licensing line for the first time, reflecting 0.6 million of revenue from our media and AI content agreements. We expect content deals and other partnerships with AI companies to grow over the coming years. Setting the one-time item aside, the quarter shows the same shift we described last quarter. Our revenue mix continued to move toward higher margin, concentrated affiliate fee and licensing revenues, and higher rates across both expanded gross margin. Gross margin was 55.3% in the third quarter, or 44% excluding the one-time item, compared to 35.3% in the prior year quarter. We will continue to invest behind this growth. Our capital allocation priorities remain focused on supporting long-term growth which include investment in programming, talent, technology, distribution, digital initiatives, and other strategic opportunities. Turning to our third quarter results. In the third quarter, we delivered 69 million in total revenues representing a 52.5% increase year over year. Excluding the $14 million one-time item, total revenues were a record 55 million, an increase of 21.6% year over year. Breaking this down by revenue stream for the quarter, starting with our reportable segments, total broadcasting revenues grew 65.9% year over year to $60.7 million in the third quarter of 2026, which includes the $14 million one-time item. Without it, broadcasting revenues grew 27.6% to $46.7 million. Our growth in broadcasting was driven by higher affiliate fee revenue, attributed to new contractual relationships and rate increases that took effect in late 2025 and 26 and by expanded international licensing agreements. Total digital revenues decreased 4.1% year-over-year to $8.3 million in the third quarter of 2026. The new media and AI licensing revenue was more than offset by lower subscription revenue, product sales, and digital advertising. Now turning to our revenue by component. Advertising revenues were $28.1 million, a 1.9% year-over-year increase as higher cable and satellite advertising from midterm election-related demand was partially offset by lower digital advertising. Affiliate revenues increased 77.4% year-over-year to $14.3 million, driven by new contractual relationships as well as rate increases that took effect in late 2025 and 2026. Subscription revenues of $6.1 million were down 12% year-over-year due to lower new customer acquisition partially offset by gains from expanded affiliate agreements that make Newsmax available on more linear cable providers. Product sales revenues decreased 21.2% year-over-year to $1.2 million, primarily reflecting lower book and supplement sales. Licensing revenues were $5.4 million, up $1.2 million in the prior year quarter, supported by the amended international licensing agreement and revenue from our media and AI content agreements. We reported quarterly net income of $15.2 million, or $0.12 per share, compared to a net loss of $4.1 million, or $0.03 per share, in the prior year quarter. The improvement was primarily driven by higher total revenue, Growth in high margin affiliate fee and licensing revenue and lower legal expenses, partially offset by continued investment in programming and production. Our quarterly adjusted EBITDA was $19 million, an improvement of $20 million from the negative $0.9 million reported in the same quarter last year. Excluding the one-time item, adjusted EBITDA was $5 million, positive for the second consecutive quarter. The underlying improvement was primarily due to growth in high-margin affiliate fee and licensing revenue, partially offset by continued investment in programming, production, and OTT initiatives. We ended the quarter with $26.7 million in cash and cash equivalents and $110.8 million in short-term investments, bringing our total cash and investment position to $137.6 million with no debt on the balance sheet. Turning to our outlook, we are maintaining our underlying full-year 2026 revenue guidance of $212 million to $216 million. That represents 13% growth year over year at the midpoint of the range. Including the one-time item, our full-year 2026 revenue guidance is $226 million to $230 million. We are encouraged by our performance through the first nine months of the year and remain confident as we look ahead. Our higher margin affiliate fee and licensing streams are the biggest levers for margin improvement in the near term. At the same time, as we continue to scale the business, reduce our legacy spend and focus on opportunities to improve margins through revenue growth from content investment, technology, and monetization across multiple platforms. In closing, we remain focused on disciplined execution as we continue to invest in content, Distribution, and OTT initiatives that support long-term growth. With a strong balance sheet, no debt, and a diversified multi-platform revenue model, we believe we are well positioned to deliver sustainable value for our shareholders. Thank you for your time today. Now we would like to open the line for analyst questions. Operator?

Thank you. The floor is now open for questions. If you wish to join the queue to ask a question at this time, please press star 1 on your telephone keypad. We do ask if you're listening on speakerphone today, please pick up your handset while asking your question to provide optimal sound quality. Once again, that will be star 1 on your telephone keypad to ask a question. Our first question comes from Thomas Forty from Maxim. Please go ahead.

Thomas Forty Great. So first off, Chris and Darryl, congratulations on the strong quarter. I have one question and one follow-up. I'll go one at a time. Chris, you gave some very thoughtful comments in your prepared remarks, and I was hoping you could go through them one more time as far as the engagement and monetization for Newsmax, typically when you compare the midterms with the presidential election.

Tom, thank you for that. Darryle, our CFO, has done studies and reviewed previous presidential election cycles, and invariably as far back as we can find, the two years leading up before a presidential election usually leads to much higher engagement revenues and and many more. That is going to play very significantly. There'll be a lot of heavy fundraising and political developments as related to that. We expect to benefit. As engagement grows, ratings grow, and all our different platforms tend to see increases, that should be good for overall revenues.

Excellent. And for my follow-up, sounds like you acquired two radio stations in Miami. Can you remind investors what your strategy is when it comes to M&A? And then looking ahead, what types of assets would you consider acquiring versus building on your own?

Newsmax has always had an interest in radio. We come out of the radio ecosphere in the sense that a lot of radio hosts have promoted Newsmax through the years from the days we started as a .com in the 90s. I think we were probably the most aligned with radio talk show hosts in the country. That market is huge on any given month. There are 30 to 50 million people tuning in to talk radio, according to various industry estimates. In some ways, it's believed to be bigger than the cable news market, and they are very highly engaged and passionate people. Over the years, radio is considered legacy media. The numbers have gone on radio down, but podcasts, which are quite related to radio, have gone up. And if you see some of the most successful podcasters, they're also people that are on radio or have radio affiliations. Newsmax got involved in radio with a syndicated radio show we launched several years ago the Rob Carson Show which is a talk radio show that broadcasts from 12 to 2 every day it's in about 35 markets I believe right now We had this opportunity for a Spanish-speaking station in Miami that's very famous, Radio Mambi, and a sister station the company there owned. And the company that owned it had not been investing in the programming. It had lost some of its audience, but the name is excellent. The reach of the signal on both stations is good. It reaches pretty much the Miami-Dade marketplace, which is a burgeoning market. We have not been involved in the Latino community much with any business. We thought this would be a good toehold for us to not only be in radio, but to also get a foothold in the Spanish speaking market where we could start by producing social media and other podcasting content using that radio station as a base. So, we thought it was a good step. I'm not sure I would describe it as part of a larger merger and acquisition strategy that we have. We're certainly open to ideas, but we like continuing to grow our platforms where they are now, which is in cable, streaming, The Plus service we have and our app, and we're doing those as well as ancillary things like social media.

Excellent. Thank you, Chris. Thanks, Darryl.

Next question comes from Michael Kopinski from Noble Capital Markets.

All right, thank you for taking my question. It's Jacob Mutchler on for Michael today. I was just curious if you could provide some color around the Newsmax Plus content library. You went from more than 300 titles to over 700 and just curious what you're seeing in some of the subscriber additions and retentions and just if there's any early indications that the expanded content lineup is helping to improve those trends. Thanks.

Well, we believe that the key to a successful streaming service is not only get the subscribers, but they stick with you. I think we've had fairly high retention rates, but we started with the core audience. And as we grow, we know that we're going to need more content to satisfy that audience and make them feel like it's worth the $50 a year to subscribe. and so we felt that the content of just the cable channel, which a lot of people get on cable systems, or just the streaming channel, Newsmax 2, which is available on most streaming platforms and on the internet free, was not enough to make that a long-term commitment to subscribers, from subscribers. and that we would benefit if we had more content. So we decided to focus more on the content. The old saying, content is king. And we have been, as you see, the numbers show we've been developing that. There does seem to be a significant increase certainly in, we mentioned in one of our statements today that there is an increased engagement in viewing time of people spending on the app year over year. That's being helped. We're doing not only news, not only documentaries. We're doing some scripted TV shows from the 60s and 70s, programs like Bonanza, Dragnet. We'll be adding more of those. We're doing some movies. We have a very big genre and a third channel we added called World at War, our military history channel. and we have been adding recently a lot of true crime or police body cam, police live tape series to Newsmax. One is called Caught on Body Cam. We just bought Bad Hombres, which was a program that was developed documentary series for the ICE during their recent operations. and many more. The current app services, Netflix, Paramount, Disney are focusing on that audience and so it gives us a niche to move into while allowing for broad distribution of the channels Newsmax 1 and Newsmax 2.

Gotcha. Great. Thank you for the color. And then if you could also just talk about, you know, how extensively AI is being used internally today, you know, in content creation and in production and just how much additional opportunity do you see to improve efficiency and reduce costs with AI internally? Thanks.

I would say that it's being used in almost every department of the company. There's good reason to use it, whether it's in the marketing department developing promotional materials, whether it's in accounting developing presentation materials or verifying or researching or double-checking data. On our legal section, it's been a great help. We go and double-check legal documents with it. We don't see it as substituting a lot of things, but we see it improves productivity, efficiency, and also provides verification on a lot of things. I know in the TV wing, in terms of producing shows, not only are they using it to help developing the content of the program, but graphics, visuals, where appropriate. And then the website, it's speeding up the amount of articles being written. We don't generally do an article just based on AI, but the AI could be forming part of the background information where an article might have taken two or three hours to put together and post on the web. It might take less than an hour now or even sooner. So these are very dramatic effects. Sometimes they're more difficult to quantify, but I do think that will impact the number of employees we need as we grow.

Gotcha. Thank you for taking my questions and congratulations on a solid quarter. Thanks.

Your next question comes from Nick McKay. from Freedom Capital.

Thank you. Thanks for taking the question, guys. Can you speak to the importance of the digital segment in the years ahead, especially given a history of revenue declines and negative adjusted EBITDA? Is there a world where divesting the digital segment makes sense and focusing more on broadcasting given more favorable economics? Thank you.

Darryl, would you like to chat about that?

Sure. Well, thank you. I think that the digital segment is key strategically to the overall growth of the company. It has been something that, as Chris mentioned, we haven't put a lot of focus on recently, but it is really the basis for the growth of the company over our 28-year history. I think one of the advantages that we have in the digital segment when you compare us to a Fox and a CNN is that we've built that relationship with the customer. So the digital segment gives us the ability to extend our reach just beyond what we would have if we were just a broadcasting network. With all of the social media engagement, all of the newsletter subscribers, all of the unique visitors and page viewers that we get on each one of the websites, it just gives us tremendous ability to kind of cross-promote the products. And as we continue to build out the brand on broadcasting and we continue to build out the content, and I think one of the key things is really the upcoming increase in engagement that Chris highlighted in his earlier responses that we're going to be seeing associated with the 2028 election. I think that the digital segment is key to participate in that growth and continue to be a very strategic component of the company overall.

Our approach, we started as a digital media company and continue to be very strong, but as Darryle well explained, that has been a tremendous tool for us to communicate to grow TV audience, to grow app audience, to grow media. Social media. So people just see it in terms of economics on the numbers, but they're missing the fact that it's actually growing other parts of the company and it's more of a base from which we launch things and communicate directly. I think what we started is we're the only digital website company that went into cable and had launched and has had a successful cable channel that I know of. The only one. Vice went in and they had a channel free that they basically licensed their name with, I think it's with A&E, but they didn't, they're not truly, in fact, it's been, I think, separate companies We actually organically from the web started a cable channel and have been very successful. We always say that the digital side was the key growth factor. And then the amount of distribution, you know, we're seeing just tremendous growth of the reach because our brand is becoming more and more powerful, not only internationally, right? We see that, but across the ecosphere of digital world. Our content is now widely picked up by MSN, Yahoo, Google News, Apple, Smart News and that we have agreements with some of these as well to move our content and we hope to increase even more. And we did a deal with Meta and they're using our content from the digital side in the AI world, which we've released and made that announcement. So there'll be lots of benefits from the digital. So if you see the newsletters, for instance, contracting, that is more of our plan, part of a larger company's strategic plan, rather than something that's happening that's a negative thing for the company.

Very fair. Thank you, guys.

Once again, if you would like to ask a question, please press star then the number one on your telephone keypad. We have no further questions on the lines. Thank you. This does conclude today's conference call. You may disconnect your phone lines at this time and have a wonderful day. Thank you for your participation.