Thank you for standing by, and welcome to Snail, Inc.'s third quarter 2026 earnings conference call and webcast. I would now like to turn the call over to Stephen Shinmachi with Investor Relations.

Thank you, and good afternoon, everyone. Welcome to Snail, Inc.'s third quarter 2026 earnings conference call and webcast. Joining us for today's call are Snail, Inc.'s Chief Financial Officer, Heidi Chow, and Senior Vice President, Director of Business Development and Operations, Peter Kang. The company's third quarter 2026 earnings press release was filed earlier today and is available on the investor relations section of Snail, Inc.'s website at www.snail.com or the SEC's website at www.sec.gov slash edgar. During this call, management may make forward-looking statements regarding future events and the future financial performance of the company. Actual events or results may differ materially from our expectations, and forward-looking statements are subject to certain risks and uncertainties. Please refer to the company's form 10-Q that has been filed with the SEC and other SEC filings. The company makes these forward-looking statements as of today. It disclaims any duty or obligation to update them or to release publicly any updates or revisions to any forward-looking statements to reflect any change in its expectations or any change in events, conditions, or circumstances on which any such statement is based. Additionally, on today's call, we refer to bookings and EBITDA, which are non-GAAP financial measures and provide useful information for the company's investors. You will find the historical reconciliation of bookings and EBITDA to the corresponding Gap Measures, and the Earnings Press Release and the Company's SEC Filings. And now, I will turn the call over to Peter Kang, Senior Vice President, Director of Business Development Operations of Snail. Sir, please proceed.

Thank you, and good afternoon, everyone. Thank you for joining us today to review our financial and operational results for the third quarter ended September 30, 2026. The third quarter marked an exceptionally strong period for Snail. reflecting the successful execution and progress of our content roadmap across multiple titles and franchises. Our primary performance driver was the same-day launch of three major ASA DLCs in early July, including Genesis Part I Ascended, Tides of Fortune, and Dragontopia. Together, these releases represented one of ASA's most meaningful content deployments in recent periods, generating substantial engagement within the art community and monetization opportunities to capitalize on. In addition to these major DLC launches, we continue to strengthen engagement across the broader ASA ecosystem. During the quarter, we launched a major update for the ARC-ASTRIOS DLC and released the Cerebrax TAME under Fantastic Tames Season 1 Pack. These launches reinforced the strength of our content monetization strategy and demonstrated the ability of the ARC ecosystem to consistently drive engagement when supported by meaningful content, updates, and releases. For the quarter, ASA sold 1.2 million units with average and peak DAU reaching approximately 121,000 and 184,000 respectively. The strong engagement from players across the title continues to validate our ongoing investment in expanding the ASA title. Beyond ASA, we expanded the Pixar universe with the official release of the TerraCrypt DLC. Our ND pipeline also continued to contribute as we executed our broader content roadmap. The third quarter demonstrated how our strategy can drive engagement and monetization across a broad range of titles, reinforcing our confidence in the established roadmap we have ahead for future quarters. While our strong Q3 results underscored the strength of our content portfolio, We believe they are only part of this quarter's story. Equally important to the revenue generating achievements this past quarter was the progress we made on the future growth drivers of Snail's pipeline and portfolio. Over the last several months, we strategically leveraged some of the gaming industry's largest global events, not simply as marketing opportunities, but as a milestone marker to demonstrate progress across our development pipeline. During the third quarter, we participated in ChinaJoy and Gamescom, both serving as valuable platforms to showcase the breadth of that pipeline, particularly for our three anticipated AAA titles, Nanyin Sutra Immortal, Nanyin Sutra Wuxia, and For the Stars. At ChinaJoy, we publicly unveiled Nanyin Sutra Immortal, our next generation open world sandbox cultivation game. Against the backdrop of rising interest in the cultivation genre in the Chinese market and an existing IP fan base from his predecessor, Eiji Wushu, we showcased a new trailer and officially launched the game's theme page, giving players worldwide an opportunity to follow its development ahead of its anticipated release. Alongside Nyan Sutra Immortal and a few smaller indie games, We debuted the first public demo of Survival of the Fittest at ChinaJoy. Attendees had an exclusive opportunity to experience the refined gameplay systems of this competitive, fast-paced title. The release timeline has been pushed to 2027 as we continue to develop and refine the PvP action experience. but we were encouraged by the traction and feedback we received as we worked to bring back the standalone competitive experience for ASA. A few weeks later, we returned to Gamescom where our headlining title was Nanyin Sutra Wuxia, the close sequel to the original Age of Wushu title. Our CEO unveiled the title during the event and in tandem officially launched this theme page. showcasing the two Nanyin Sutra titles at the respective industry events allowed us to share our continued development progress, and we received encouraging positive feedback from the event attendees. By taking distinct creative directions with the two Nanyin Sutra titles, we aim to expand the IP's creative potential while giving each game a unique identity and gameplay experience. Alongside Nian Sutra Wuxia, we also showcased For the Stars at Gamescom through a new gameplay trailer, an exclusive demo for members of the media, and additional insight into its development. We are pleased with the title's progress and particularly encouraged by feedback from members of the media who experienced the demo firsthand. Together with the two Nian Sutra titles, for the Stars remains a future growth driver intended to diversify Snail's portfolio beyond the ARK IP. We look forward to sharing further development updates and sneak peeks ahead of these titles' official launch. Operationally, as shared on our last quarter's earnings call, our subsidiary Eaglefold officially unveiled the AI Ranch Initiative and publicly debuted NHP, are non-human players. Designed as AI companions, NHPs are intended to behave, learn, and adapt like human teammates to serve as a dynamic partner throughout a player's gaming experience. We continue to believe this personalized experience has the potential to address the barriers faced by both casual and hardcore gamers. We look forward to further refining the NHP software and Capabilities and updating the market as we achieve key milestones. Roughly a month and a half into the fourth quarter, we've had a couple of new game releases, including the successful launch of the famed game two, L.A. Heartbreaker, which to date has received an overwhelmingly positive rating on Steam. The early success this title has had, especially in the Chinese market, is encouraging to see, and we are pleased with the milestone and the continued development of the Interactive Films portfolio. A major content update for Bellwright is also expected in the fourth quarter. Featured during Gamescom, attendees previewed Games' highly requested traversal feature, which received positive reviews. Bellwright has been a standout title this year, surpassing 1 million units sold during the first quarter. For the nine-month period, Tellwright sales increased 4.6 million, supported by console launch on PlayStation and Xbox in June. We remain committed to refining the title, sustaining a strong player base, and exploring new monetization and player engagement strategies. More recently, We showcased Nian Sutra Immortal and For the Stars at IGN FanFest and released new demos for Dead Party, Whispers of West Grove, and Veil of Madness during the Steam Next Fest. Another industry event Snail will be participating in December is the Game Awards Show, which will feature a number of our portfolio titles with new announcement trailers. The Noise Digital Store is also another developing initiative which will begin alpha testing in the coming months. This is an expansion of our partnership with the Noise platform. As a reminder, Noise is a platform operating since 2017 that connects gaming micro-influencers with publishers and developers like Snail to drive authentic game promotion. At the upcoming TwitchCon event, We plan to build on this foundation by engaging with content creators, onboarding new users to the Noise platform, and showcasing new titles in a relaxing setting. New developments of the Noise platform are expected to come soon as the core platform completes its Noise 4.0 update. The focus here is reducing creator payout processing times, and we plan to address the sources of delay and stages. We expect to share further updates here in the coming months. We're also preparing to launch the Noise Digital Warehouse, which will initially offer CD keys with plans to expand into other digital assets over time. The Noise Digital Warehouse is expected to enable creators to participate as affiliates or wholesalers, providing additional revenue opportunities through direct sales of digital goods. We're excited to advance strategic initiatives with NOIZE, and like our NHP project, the opportunities we are pursuing through NOIZE are intended to support Snail's revenue diversification strategy beyond traditional game development and publishing. As we close out the year, two major content releases scheduled for the fourth quarter include the upcoming Tames and Content releases for the ARK Fantastic Tames Season 1 Pack and the Dragontopia DLC. Notably, the Dragontopia DLC update will introduce Boundless Sky World Map. These releases and activity round out a robust year of content, where our roadmap extends beyond 2026. As previously announced, we have another substantial slate of ARC releases planned for 2027. Three additional ASA DLCs are slated for release throughout next year, These include Ark Atlantis, Galaxy Wars, and Legacy of Santiago DLC. Also planned for 2027 are the Ark Maker content creation tool intended as an engagement driver tool for ASA console players. Ark Survivor of the Fittest, which as I mentioned earlier, was demoed at ChinaJoy in a brand new Pixar Worlds title. Alongside our content, we have a slate of smaller indie titles scheduled throughout 2027, including Gobby Gang, which has undergone internal alpha testing over the last few months. We also expect to continue sharing substantial development updates on our three aforementioned AAA titles throughout the year. After a challenging 2025, We are pleased to see the Bounce Back Recovery experience here today, and we aim to sustain this positive momentum as we close out the year and head into 2027. Thank you for joining us today. I will now turn the call over to Heidy to discuss our financial results for the third quarter ended September 30th, 2026. Heidy?

Thank you, Peter, and good afternoon, everyone. Thank you all for joining us today as I review our financial results for the third quarter and nine months in September 30th, 2026. Net revenue for the quarter increased to 33.1 million compared to 13.8 million in the same period last year. The increase was primarily due to a 13.9 million change in deferred revenue a $4.9 million increase in sales from ASE, primarily driven by the base game and the release of Pies of Fortune and Dragontopia DLC, a $1 million increase in sales of Valrite, and a $400,000 increase in sales of Honeycomb The World Beyond, partially offset by a decrease of $500,000 sales from ASE, decrease in art mobile sales of $200,000 and a decrease in salty TV sales of $200,000. Net revenue for the nine-month period increased to $80 million compared to $56.1 million in the same period last year. The increase was primarily due to a change in deferred revenue of $19.2 million An increase in ASA sales of $4.8 million, which was primarily driven by sales of The Bayscape, Art and Bob's Tall Tales, Lost Colony, and the newly released Ties of Fortune and Dragontopia DLCs. An increase in Bellwright sales of $4.6 million, and a $400,000 increase in sales from Honeycomb, The World Beyond, The increase in revenue was partially offset by decreasing revenue from ASE of $3.2 million, a decrease in Art Mobile revenue of $1.5 million, and a decrease in Saucy TV revenue of $400,000. Net income for the quarter was $6.7 million compared to a net loss of $7.9 million in the same period last year. The improvement was primarily due to an increase in gross profit of $17.6 million. Net income for the nine-month period was $5.8 million compared to a net loss of $26.4 million in the same period last year. The improvement was primarily due to an increase in revenue of $23.9 million a decrease in provision of income taxes of $10.4 million, a decrease in cost of revenue of $300,000, partially offset by an increase in total operating expenses of $1.9 million, and total other expenses of $600,000. EBITDA for the quarter improved to $7.2 million compared to loss of $9.7 million in the same period last year. The increase was primarily driven by a $14.5 million increase in net income, a decrease in interest income and interest income-related parties of $400,000, and an increase in the provision of income taxes of $2 million. EBITDA for the nine-month period increased to $6.5 million compared to lots of 15.6 million in the same period last year. The increase was primarily due to an increase in net income of 32.1 million, partially offset by a decrease in provision of income taxes of 10.4 million. Total units sold for the quarter increased to 2 million compared to 1.1 million in the same period last year. The increase was primarily due to an increase in ASA cells of 700,000 units and an increase in Bellwright cells of 100,000 units. Total units sold for the nine-month period increased to 6.2 million compared to 4.8 million in the same period last year. The increase was primarily due to an increase in ASA cells of 1.7 million units and an increase in Bellwright sales of 300,000 units, partially offset by a decrease in ASA sales of 800,000 units. Bookings for the quarter increased to 23 million compared to 17.6 million in the same period last year. The increase was primarily due to higher sales of ASA and Bellwright, partially offset by lower bookings from ASE. Bookings for the nine-month period increased to $71.7 million compared to $67 million in the same period last year. The increase was primarily due to a higher sales of ASE and Bellwright, which benefited from promotional pricing during the period. offset by ASE as the title continued to mature and consumer demand shifted toward ASE and its related downloadable content. Lastly, as of September 30th, 2026, unrestricted cash was $12.1 million compared to $8.6 million as of December 31st, 2025. To review our detailed financial statements, Please refer to the earnings press release and the Form 10-Q file with the SEC. Building on Peter's remarks, our fourth quarter performance will be supported by scheduled release of upcoming teams and content releases planned for ARK Fantastic Teams Season 1 and ARK Dragontopia DLC. These additions complement the recent successful launch of the Fame Game 2 LA Heartbreaker, and the Indy Title launches, rounding out our content slate for the remainder of the year. While our fourth quarter content slate is more modest than Q3, we entered the final few weeks of the year with recent launches complemented by additional content across the portfolio. It is important to view that outlook in the context of the full year rather than against the strength of Q3 alone. We are encouraged by the growth achieved today and expect our full year results to reflect continued growth compared with both 2025 and 2024. Looking beyond the remainder of this year, we aim to carry that positive momentum into 2027. As Peter outlined, another strong state of ARC content is scheduled throughout 2027 and will serve as the anchor of the year. Alongside that content state, 2027 will be another important year for advancing our broader development pipeline. For the stars, Nying Sitra Imodo and Nying Sitra Wuxia are progressing through their final stages of development as we prepare for their eventual commercial launches. We remain excited about these upcoming titles and their potential to contribute to our longer-term portfolio. Thank you for joining us today, and this concludes our prepared remarks. We will now open the line for Q&A. Operator, please proceed.

Thank you. To ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A roster. And our first question comes from George Proust of Noble Capital Markets. Your line is open.

Hi, this is George Proust filling in for Mike Kupinski. Congratulations on the quarter. Wow. My first question is, so Q3 was your biggest unit quarter in a while. Beyond the numbers, what did it show you about the ARC players and what they actually pay for? And how does that change to what you build in 2027? Hi, this is Peter.

So this is definitely a great indication for the franchise as this is one of the first new DLCs, meaning an extension of the storyline and narrative that we're releasing since transferring the franchise from Ark Survival Evolved to Ark Survival Ascended. So this is a great indication of a continuation of the storyline and rabid fans eager to consume.

And a follow up to that is, is the next wave just more paid maps or is there a different way of generating revenue?

So as we look into the 2027 pipeline, we do continue to rely on DLCs to drive primary sales. Along with that, you'll see cosmetic-related and tame-related DLCs, such as that fantastic Tames package. So as we continue to evolve, you see us getting into UGC via the partnership with Overwolf. and, you know, that set of things continues to evolve with the community as most of the content is player driven.

Gotcha. And between Noise, the digital warehouse, the ArcMaker, it kind of sounds like you're building a creator economy around your games. Long term, do you creators become a real sales channel for Snail? And how big could that get compared to, say, Steam?

Right, that's a very perceptive perspective. We're definitely building a very large ecosystem that will encompass not only gaming, but other digital offerings that content creators can endorse and take apart in sales. The offering from Noids itself will also, you know, continue to evolve in will start to prioritize the ability for brands to activate the value in CD keys and other digital assets.

So if creators are reselling keys as wholesalers, how does that keep you from, how does it keep them from undercutting your own pricing on Steam?

The price will maintain. It's really a matter of So, you know, we're not too ready to disclose the complete mechanics of how that business will turn, but let's assuredly we have considered every part of the puzzle, and there's a little bit more to the story, and we'll be releasing it when we're ready.

Gotcha. And I have one more question. So, if AI cuts the cost of building a DLC map in sit in half over the next few years. Does that make ARC's position stronger, or does it make it easier for competitors to copy?

That's a very curious question. Certainly, we're in the state of things where that field is rapidly advancing. I'd say the way we perceive intellectual property needs to expand as well with that market to make sure that as keepers of the original code, we're able to profit and monetize from usage of it as well. So we're going to lean on our business development capabilities and try our best to protect our interests. As far as AI decreasing the The cost, you know, that's still left to be seen, right? We haven't fully committed to full utilization of AI in every aspect of game development. So it is going to take a little bit for us to see where the needle lands.

Gotcha. Thank you.

Thank you. This concludes Snail, Inc.'s third quarter 2026 conference call. If your question was not taken, please contact Snail, Inc.'s IR team at snal at gateway-grp.com. Thank you for your participation, and you may now disconnect.