Core Insights - PodcastOne announced preliminary financial results for Q2 Fiscal 2026, highlighting significant growth in revenue and adjusted EBITDA [1][5] - The company reported over $14.5 million in revenue, representing a 19% year-over-year increase, and adjusted EBITDA exceeding $1 million, a 348% increase year-over-year [5] Financial Performance - Revenue for Q2 Fiscal 2026 reached $14.5 million, marking a 19% increase compared to the previous year [5] - Adjusted EBITDA was reported at over $1 million, reflecting a substantial 348% increase year-over-year [5] - PodcastOne maintained a 9 ranking on Podtrac's Top 10 Publishers rankings for nine consecutive months [5] Company Overview - PodcastOne is a leading podcast platform with over 3.9 billion total downloads and a community of 200 top podcasters [3] - The company has a distribution network that generates over 1 billion monthly impressions across various channels, including YouTube, Spotify, and Apple Podcasts [3] - PodcastOne also offers customizable production packages through its subsidiary, PodcastOne Pro [3]

Core Viewpoint - LiveOne is committed to enhancing stockholder value through strategic initiatives, financial restructuring, and growth opportunities in the music and entertainment industry [1][2]. Financial Position - LiveOne has over $18 million in cash, including $5 million in Bitcoin, which provides a solid foundation for future growth and investment [5]. - The company completed a $10 million common stock equity financing at $7.50 per share, strengthening its balance sheet [8]. - LiveOne reported preliminary Q1 Fiscal 2026 record Adjusted EBITDA of over $1 million, a 348% increase year-over-year, and revenue of over $14.5 million, a 19% increase year-over-year [9]. Recent Key Achievements - Successfully completed a $45 million restructuring initiative, resulting in significant cost savings [2]. - Reduced workforce from over 300 to 95 employees, leveraging AI for efficiency [8]. - Eliminated $14 million in short-term liabilities and repurchased $6.5 million in stock, with $5.5 million remaining in its buyback program [8]. - Acquired 347,000 additional shares of PodcastOne [8]. - Closed six B2B deals generating $50 million in revenue, with 72 potential B2B deals in the pipeline [9]. Strategic Initiatives - LiveOne is exploring strategic options to increase stockholder value, including consolidation, sale, or merger opportunities [9]. - The board approved up to $500 million treasury authorization to expand LiveOne's crypto asset treasury strategy [8]. - The company is expanding its Web3 strategy by tokenizing and monetizing over 10,000 hours of video content on the blockchain [8]. Valuation Opportunity - LiveOne's stock is considered significantly undervalued, trading at approximately 60% of revenues compared to the industry average multiple of 3.3x revenues [13]. - Senior management and board members have committed to purchasing up to $3 million worth of LiveOne shares, reflecting confidence in the company's future prospects [13]. Future Plans - LiveOne recently completed a reverse stock split to maintain its Nasdaq listing and strengthen its market position [12]. - The company intends to continue its aggressive stock buyback program to enhance stockholder value [16]. - LiveOne is increasing live events, with historical events generating significant revenue [16].

Core Insights - The Adam Carolla Show has reached a significant milestone of 4,000 episodes, marking it as one of the few podcasts globally to achieve this feat [2][4] - Adam Carolla was inducted into the Podcast Hall of Fame in 2024, highlighting his influence and contributions to the podcasting industry [2][4] - PodcastOne, the publisher of The Adam Carolla Show, has surpassed 3.9 billion total downloads and has a community of 200 top podcasters [7] Company Achievements - The Adam Carolla Show has been a leading podcast since its launch in 2009, consistently ranking in the Top 20 for over a decade [5] - The show has pioneered the concept of live podcast recordings in front of ticketed audiences, enhancing its popularity and engagement [5] - Adam Carolla has leveraged his podcast success to become a New York Times bestselling author with six published non-fiction books [5] Industry Context - PodcastOne is recognized as a leading podcast platform, providing a comprehensive solution for creators and advertisers in sales, marketing, public relations, production, and distribution [7] - The platform features a diverse range of top-ranked podcasts across various genres, including news, comedy, true crime, sports, and culture [6] - PodcastOne's distribution network reaches over 1 billion monthly impressions across multiple channels, including YouTube, Spotify, and Apple Podcasts [7]

Core Insights - LiveOne has increased its Bitcoin holdings to over $5 million, indicating a strategic focus on digital assets for diversification and long-term growth [1][2] - The company has acquired an additional 347,000 shares of PodcastOne, bringing its total holdings to approximately 2.1 million shares since PodcastOne became public [1][4] Company Strategy - The Chairman and CEO of LiveOne emphasized the importance of Bitcoin in the company's treasury strategy, highlighting a commitment to responsibly expand digital asset holdings while innovating in music, entertainment, and Web3 initiatives [2] - LiveOne aims to implement a $500 million treasury yield strategy and plans to tokenize and monetize over 10,000 hours of video content on the blockchain [4] Company Overview - LiveOne is headquartered in Los Angeles, CA, and operates as a creator-first music, entertainment, and technology platform, offering premium experiences and content through memberships and live/virtual events [2] - The company's subsidiaries include Slacker, PodcastOne, PPVOne, Custom Personalization Solutions, LiveXLive, DayOne Music Publishing, Drumify, and Splitmind, showcasing a diverse portfolio in the entertainment sector [2]

Company Overview - PodcastOne (Nasdaq: PODC) is a leading podcast platform that offers a comprehensive solution in sales, marketing, public relations, production, and distribution for creators and advertisers [2] - The platform has achieved over 3.9 billion total downloads and has a community of 200 top podcasters [2] - PodcastOne's distribution network reaches over 1 billion monthly impressions across various channels, including YouTube, Spotify, Apple Podcasts, and iHeartRadio [2] Financial Guidance - PodcastOne has updated its guidance for the fiscal year ending March 31, 2026, expecting Adjusted EBITDA of $4.5-6 million on revenue of $55-60 million [1] - LiveOne has acquired an additional 347,000 shares of PodcastOne, increasing its total acquisitions to approximately 2.1 million shares at an average price of $2.11 since PodcastOne went public [1] Non-GAAP Financial Measures - The company presents non-GAAP financial measures such as Contribution Margin and Adjusted EBITDA to evaluate performance, which are not intended to replace GAAP measures [4][5] - Adjusted EBITDA is defined as earnings before interest, taxes, depreciation, and amortization, excluding certain non-recurring expenses and stock-based compensation [7] - The variability of certain items excluded from Adjusted EBITDA may significantly impact future GAAP financial results, making a quantitative reconciliation challenging [8]

Core Insights - PodcastOne has become the 9th largest podcast distributor in the US, achieving over 4 billion all-time downloads [1] - The company has entered a multi-year agreement for exclusive sales and distribution rights for the podcast "Beach Too Sandy, Water Too Wet" and expanded its relationship with "Notsam Wrestling" [1][2] - PodcastOne's total show count has surpassed 200, enhancing its offerings in comedy and sports genres [1] Company Overview - PodcastOne is a leading podcast platform providing a comprehensive solution in sales, marketing, public relations, production, and distribution [6] - The platform has surpassed 3.9 billion total downloads and has a community of 200 top podcasters [6] - PodcastOne's distribution network reaches over 1 billion monthly impressions across various channels, including YouTube, Spotify, and Apple Podcasts [6] Programming Expansion - The addition of "Beach Too Sandy, Water Too Wet" strengthens PodcastOne's portfolio of award-winning comedy podcasts [2] - The company continues to expand its diverse slate of premium programming, which includes popular shows like "The Adam Carolla Show" and "The Jordan Harbinger Show" [5] - PodcastOne's shows are accessible on multiple platforms, ensuring broad reach and availability [5]

[PART I — FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20%E2%80%94%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements for PodcastOne, Inc., including the Balance Sheets, Statements of Operations, Stockholders' Equity, and Cash Flows for the periods ended June 30, 2025, and March 31, 2025 (or June 30, 2024, for comparative periods), along with detailed notes explaining the company's organization, accounting policies, and specific financial line items [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Condensed Consolidated Balance Sheets (in thousands) | Metric | June 30, 2025 (in thousands) | March 31, 2025 (in thousands) | Change | | :----------------------------- | :----------------------------- | :----------------------------- | :----- | | Cash and cash equivalents | $1,870 | $1,079 | +$791 | | Accounts receivable, net | $6,818 | $6,246 | +$572 | | Total Current Assets | $8,819 | $7,555 | +$1,264 | | Total Assets | $22,336 | $21,195 | +$1,141 | | Accounts payable and accrued liabilities | $7,125 | $5,539 | +$1,586 | | Total Current Liabilities | $7,620 | $6,053 | +$1,567 | | Total Liabilities | $7,620 | $6,053 | +$1,567 | | Total stockholders' equity | $14,716 | $15,142 | -$426 | [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Condensed Consolidated Statements of Operations (in thousands) | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | YoY Change | | :----------------------------- | :------------------------------------ | :------------------------------------ | :--------- | | Revenue | $14,994 | $13,159 | +14% | | Cost of sales | $13,555 | $11,709 | +16% | | Total operating expenses | $16,048 | $14,525 | +10.5% | | Loss from operations | $(1,054) | $(1,366) | -22.8% | | Net loss | $(1,054) | $(1,366) | -22.8% | | Net loss per share – basic and diluted | $(0.04) | $(0.06) | -33.3% | - Amortization of intangible assets decreased by **67% YoY** to **$125 thousand** (from **$377 thousand**)[15](index=15&type=chunk) - Impairment of intangible assets decreased by **100% YoY** to **$0** (from **$176 thousand**)[15](index=15&type=chunk) [Condensed Consolidated Statements of Stockholders' Equity](index=7&type=section&id=Condensed%20Consolidated%20Statement%20of%20Stockholders'%20Equity) Condensed Consolidated Statements of Stockholders' Equity (in thousands) | Metric | As of June 30, 2025 (in thousands) | As of March 31, 2025 (in thousands) | | :----------------------------- | :--------------------------------- | :--------------------------------- | | Additional Paid in Capital | $51,839 | $51,211 | | Accumulated Deficit | $(37,123) | $(36,069) | | Total Stockholders' Equity | $14,716 | $15,142 | - Net loss for the three months ended June 30, 2025, was **$(1,054) thousand**[18](index=18&type=chunk) - Stock-based compensation contributed **$66 thousand** to additional paid-in capital[18](index=18&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Condensed Consolidated Statements of Cash Flows (in thousands) | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | | :------------------------------------ | :------------------------------------ | :------------------------------------ | | Net cash provided by (used in) operating activities | $903 | $(480) | | Net cash used in investing activities | $(112) | $(74) | | Net change in cash and cash equivalents | $791 | $(554) | | Cash and cash equivalents, end of period | $1,870 | $891 | - Adjustments to reconcile net loss to net cash from operating activities included **$1.5 million** in stock-based compensation (up from **$0.4 million** in 2024) and **$0.2 million** in depreciation and amortization (down from **$0.4 million** in 2024)[21](index=21&type=chunk) - Changes in operating assets and liabilities provided **$0.3 million** in cash, compared to a use of **$0.2 million** in the prior year[21](index=21&type=chunk) [Notes to the Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) [Note 1 — Organization and Basis of Presentation](index=9&type=section&id=Note%201%20%E2%80%94%20Organization%20and%20Basis%20of%20Presentation) PodcastOne, Inc. is a Delaware corporation and a leading podcast platform, majority-owned by LiveOne, Inc. The financial statements are prepared on a standalone basis, but related party transactions with LiveOne may not be at arm's length. The company has an accumulated deficit and working capital that raise substantial doubt about its ability to continue as a going concern without additional financing - PodcastOne is a leading podcast platform and publisher, a majority-owned subsidiary of LiveOne, Inc.[24](index=24&type=chunk)[25](index=25&type=chunk) - The company has an accumulated deficit of **$37.1 million** and working capital of **$1.2 million** as of June 30, 2025, raising substantial doubt about its ability to continue as a going concern[29](index=29&type=chunk)[182](index=182&type=chunk) - Management anticipates existing cash resources will not be sufficient beyond June 2026 without additional financing[30](index=30&type=chunk) [Note 2 — Summary of Significant Accounting Policies](index=10&type=section&id=Note%202%20%E2%80%94%20Summary%20of%20Significant%20Accounting%20Policies) This note details the company's significant accounting policies, including revenue recognition, allocation of costs from its parent company, gross versus net revenue recognition, advertising revenue, cost of sales, sales and marketing, product development, stock-based compensation, income taxes, earnings per share, segment reporting, cash and cash equivalents, accounts receivable, related party receivables and payables, property and equipment, goodwill, intangible assets, fair value measurements, concentration of credit risk, and recently adopted/issued accounting pronouncements - Revenue is recognized when control of goods/services is transferred, primarily from advertising sales based on impressions[36](index=36&type=chunk)[40](index=40&type=chunk) - Barter revenue for the three months ended June 30, 2025, was **$7.0 million**, up from **$6.0 million** in 2024[41](index=41&type=chunk) - The company operates as a single segment: a leading podcast platform and publisher[50](index=50&type=chunk) Accounts Receivable, Net (in thousands) | Metric | June 30, 2025 (in thousands) | March 31, 2025 (in thousands) | | :----------------------------- | :----------------------------- | :----------------------------- | | Accounts receivable, gross | $6,890 | $6,318 | | Less: Allowance for credit losses | $(72) | $(72) | | Accounts receivable, net | $6,818 | $6,246 | - The company adopted ASU 2023-09 (Income Taxes) on April 1, 2025, with no material impact[68](index=68&type=chunk) - ASU 2024-03 (Disaggregation of Income Statement Expenses) is effective for fiscal years beginning after December 15, 2026, and is currently being evaluated[69](index=69&type=chunk) [Note 3 — Property and Equipment](index=17&type=section&id=Note%203%20%E2%80%94%20Property%20and%20Equipment) Net property and equipment decreased to $55 thousand as of June 30, 2025, from $59 thousand as of March 31, 2025. This was primarily due to a $0.9 million write-off of internally developed software no longer in use, offset by new purchases Total Property and Equipment, Net (in thousands) | Metric | June 30, 2025 (in thousands) | March 31, 2025 (in thousands) | | :--------------------------------- | :----------------------------- | :----------------------------- | | Total property and equipment, net | $55 | $59 | - During Q2 2025, the company wrote off **$0.9 million** of internally developed software and corresponding accumulated depreciation[72](index=72&type=chunk) - Depreciation expense was **$0.025 million** for Q2 2025, down from **$0.066 million** for Q2 2024[71](index=71&type=chunk) [Note 4 — Goodwill and Intangible Assets](index=17&type=section&id=Note%204%20%E2%80%94%20Goodwill%20and%20Intangible%20Assets) Goodwill remained stable at $12.0 million as of June 30, 2025, with no impairment indicators. Finite-lived intangible assets, primarily content creator relationships and brand/trade names, decreased to $1.1 million net, due to amortization and a prior year impairment charge Goodwill and Intangible Assets, Net (in thousands) | Metric | June 30, 2025 (in thousands) | March 31, 2025 (in thousands) | | :----------------------------- | :----------------------------- | :----------------------------- | | Goodwill | $12,041 | $12,041 | | Intangible assets, net | $1,061 | $1,186 | - Amortization expense on finite-lived intangible assets was **$0.1 million** for Q2 2025, a significant decrease from **$1.1 million** for Q2 2024[74](index=74&type=chunk) - No impairment charges were recorded for Q2 2025, compared to **$0.2 million** in Q2 2024 due to the winding down of a podcast show[74](index=74&type=chunk) Amortization Schedule for Finite-Lived Intangible Assets (in thousands) | For Years Ending March 31, | Amount (in thousands) | | :------------------------- | :-------------------- | | 2026 (remaining nine months) | $456 | | 2027 | $338 | | 2028 | $101 | | 2029 | $101 | | 2030 | $65 | | Thereafter | $- | | Total | $1,061 | [Note 5 — Accounts Payable and Accrued Liabilities](index=18&type=section&id=Note%205%20%E2%80%94%20Accounts%20Payable%20and%20Accrued%20Liabilities) Total accounts payable and accrued liabilities increased to $7.1 million as of June 30, 2025, from $5.5 million as of March 31, 2025. This increase was driven by higher accounts payable and other accrued liabilities, partially offset by a decrease in accrued revenue share Accounts Payable and Accrued Liabilities (in thousands) | Metric | June 30, 2025 (in thousands) | March 31, 2025 (in thousands) | | :----------------------------- | :----------------------------- | :----------------------------- | | Accounts payable | $2,409 | $1,285 | | Accrued revenue share | $1,648 | $1,962 | | Other accrued liabilities | $3,068 | $2,292 | | Total | $7,125 | $5,539 | [Note 6 — Related Party Transactions](index=20&type=section&id=Note%206%20%E2%80%94%20Related%20Party%20Transactions) LiveOne, the parent company, owns approximately 71% of PodcastOne's common stock. PodcastOne had a net related party payable to LiveOne of $0.1 million as of June 30, 2025. LiveOne allocated $0.4 million in overhead expenses to PodcastOne for Q2 2025. PodcastOne also issued common stock to LiveOne in exchange for amounts owed under a cost sharing agreement - LiveOne owns approximately **71%** of PodcastOne's common stock as of June 30, 2025[79](index=79&type=chunk)[97](index=97&type=chunk) - Overhead expenses allocated from LiveOne to PodcastOne were **$0.4 million** for Q2 2025 (up from **$0.3 million** in Q2 2024)[80](index=80&type=chunk) - Net related party payable to LiveOne was **$(0.1) million** as of June 30, 2025[56](index=56&type=chunk) - PodcastOne issued **237,113 shares** of common stock (fair value **$0.5 million**) to LiveOne in Q2 2025 for cost sharing[83](index=83&type=chunk) [Note 7 — Commitments and Contingencies](index=21&type=section&id=Note%207%20%E2%80%94%20Commitments%20and%20Contingencies) PodcastOne has contractual obligations for guaranteed payments to content providers totaling $1.2 million through fiscal year 2028. The company entered into new employment agreements with its President and Chief Revenue Officer, including RSU grants. A three-year Enterprise Service and Advertising Agreement with ART19 LLC is expected to drive monetization, with a minimum guarantee of $15.0 million over the term. LiveOne, as the parent, entered into a $16.8 million secured convertible debenture agreement, guaranteed by PodcastOne and secured by its assets - Contractual obligations for guaranteed payments to content providers: **$1.0 million** (FY2026), **$0.1 million** (FY2027), **$0.1 million** (FY2028)[84](index=84&type=chunk) - New employment agreements for President Kit Gray and Chief Revenue Officer Sue McNamara include annual salaries of **$375,000** and **$325,000**, respectively, plus RSU grants[86](index=86&type=chunk)[87](index=87&type=chunk) - Enterprise Service and Advertising Agreement with ART19 LLC includes a minimum guarantee of **$15.0 million** over three years[88](index=88&type=chunk) - Revenue recognized from ART19 agreement: **$1.4 million** for Q2 2025 (none in Q2 2024)[88](index=88&type=chunk) - LiveOne issued **$16.8 million** in Initial Debentures (convertible, **11.75% interest**, maturing May 2028), guaranteed by PodcastOne and secured by a lien on all of PodcastOne's assets[91](index=91&type=chunk)[95](index=95&type=chunk) [Note 8 — Employee Benefit Plan](index=23&type=section&id=Note%208%20%E2%80%94%20Employee%20Benefit%20Plan) PodcastOne employees participate in LiveOne's 401(k) plan, with discretionary matching contributions. Company matching contributions were not material for the three months ended June 30, 2025 and 2024 - Employees participate in LiveOne's 401(k) plan[96](index=96&type=chunk) - Company matching contributions were not material for Q2 2025 and Q2 2024[96](index=96&type=chunk) [Note 9 — Stockholders' Equity](index=23&type=section&id=Note%209%20%E2%80%94%20Stockholders'%20Equity) LiveOne owns approximately 71% of PodcastOne's common stock. The company's authorized capital includes 100 million common shares and 10 million preferred shares. Unrecognized compensation costs for PodcastOne RSUs were $1.8 million as of June 30, 2025, to be recognized over 0.78 years - LiveOne owns approximately **71%** of PodcastOne's issued and outstanding common stock as of June 30, 2025[97](index=97&type=chunk) - Authorized shares: **100,000,000 common stock**, **10,000,000 preferred stock**[98](index=98&type=chunk)[109](index=109&type=chunk) - Unrecognized compensation costs for unvested PodcastOne RSUs: **$1.8 million**, expected to be recognized over **0.78 years**[108](index=108&type=chunk) - Stock-based compensation expense recognized by PodcastOne for LiveOne awards was less than **$0.1 million** for Q2 2025 and **$0.1 million** for Q2 2024[101](index=101&type=chunk) [Note 10 - Subsequent Events](index=25&type=section&id=Note%2010%20-%20Subsequent%20Events) Subsequent to the quarter end, LiveOne completed an equity offering, raising approximately $9.5 million, with proceeds intended for cryptocurrency investments and working capital. LiveOne also amended its debenture terms to permit cryptocurrency purchases and management. Additionally, LiveOne completed a preferred stock exchange, converting Series A Preferred Stock into common stock and warrants - LiveOne completed an equity offering on July 17, 2025, raising approximately **$9.5 million** (gross proceeds) for cryptocurrency acquisition and treasury strategy[112](index=112&type=chunk)[113](index=113&type=chunk)[114](index=114&type=chunk) - LiveOne amended its Initial Debentures on August 5, 2025, to allow the purchase and active management of Bitcoin, Solana, or Ethereum (Crypto)[115](index=115&type=chunk) - LiveOne completed a preferred stock exchange on July 15, 2025, converting **$6.75 million** of Series A Preferred Stock into **4.5 million common shares** and **4.5 million three-year warrants**[116](index=116&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=27&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) PodcastOne, a leading podcast platform, reported a 14% revenue increase to $15.0 million and a reduced net loss of $1.1 million for Q2 2025. The company continues to expand its content, monetize through advertising, and manage liquidity challenges, including reliance on parent company LiveOne's financing and debt covenants [Overview](index=29&type=section&id=Overview) - PodcastOne is a leading podcast platform and publisher, spun out from LiveOne on September 8, 2023, and trades on Nasdaq under "PODC"[122](index=122&type=chunk)[123](index=123&type=chunk) - The company produces vodcasts, branded podcasts, merchandise, and live events, delivering **millions of monthly impressions**, **6.0+ million monthly unique listeners**, and **17+ million IAB monthly downloads**[124](index=124&type=chunk) - Revenue for Q2 2025 was **$15.0 million**, representing **14% year-over-year growth**[127](index=127&type=chunk) [Recent Developments for the Quarter Ended June 30, 2025](index=29&type=section&id=Recent%20Developments%20for%20the%20Quarter%20Ended%20June%2030,%202025) - Expanded programming slate to **194 shows**[129](index=129&type=chunk) - Surpassed **3.8 billion network downloads**[129](index=129&type=chunk) - Ranked as high as **8** on Podtrac's Top Podcast Publishers list[129](index=129&type=chunk) - Acquired exclusive rights to certain podcasts, including ownership and IP for true crime podcasts for potential TV/film projects[130](index=130&type=chunk) [Our Business Model](index=29&type=section&id=Our%20Business%20Model) - Business model is Ad-Supported Service, providing free content and generating revenue from audio, video, and social advertising impressions[132](index=132&type=chunk) - Focuses on host-read embedded ads and programmatic monetization[132](index=132&type=chunk) - Revenue deals with new talent are based on a percentage split of advertising revenue[134](index=134&type=chunk) [Key Factors Affecting Our Performance](index=31&type=section&id=Key%20Factors%20Affecting%20Our%20Performance) - Digital advertising industry is shifting to "viewable" impression standards and data-driven technologies like automated buying[136](index=136&type=chunk)[137](index=137&type=chunk) - Revenue is generated by charging a cost per thousand impressions (CPM) based on purchased digital ads[138](index=138&type=chunk) - PodcastOne owns one of the largest networks in North America, with over **300 exclusive shows** and over **3.6 billion downloads** in FY2025[139](index=139&type=chunk) - Operates LaunchPadOne, a self-publishing platform for independent podcasters, serving as a talent pool[140](index=140&type=chunk) [Key Business Metric](index=32&type=section&id=Key%20Business%20Metric) Number of Podcast Downloads | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | YoY Growth | | :-------------------------- | :------------------------------- | :------------------------------- | :--------- | | Number of podcast downloads | 51,423,500 | 55,856,000 | (8)% | - The decrease in downloads is attributed to modified download behavior by Apple iOS 17 and the departure of non-revenue generating partner networks[142](index=142&type=chunk) [Components of Results of Operations](index=33&type=section&id=Components%20of%20Results%20of%20Operations) - Revenue primarily from sale of audio, video, and display advertising space to third-party exchanges[145](index=145&type=chunk) - Cost of sales consists of revenue sharing expenses owed to content creators and commissions[146](index=146&type=chunk) - Operating expenses include personnel-related expenses, stock-based compensation, and allocated overhead[147](index=147&type=chunk) - Expects operating expenses to increase in dollar amount in the short term but decrease as a percentage of revenue over the longer term[147](index=147&type=chunk) [Results of Operations](index=34&type=section&id=Results%20of%20Operations) Results of Operations (in thousands) | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | % Change | | :----------------------------- | :------------------------------------ | :------------------------------------ | :------- | | Revenue | $14,994 | $13,159 | 14% | | Cost of sales | $13,555 | $11,709 | 16% | | Sales and marketing expenses | $879 | $847 | 4% | | Product development | $12 | $18 | (33)% | | General and administrative | $1,477 | $1,398 | 6% | | Amortization of intangible assets | $125 | $377 | (67)% | | Impairment of intangible assets | $0 | $176 | (100)% | | Loss from operations | $(1,054) | $(1,366) | (23)% | - Stock-based compensation expense increased by **272%** to **$1.5 million** in Q2 2025, primarily due to a **4082% increase** in cost of sales[154](index=154&type=chunk) [Non-GAAP Financial Measures](index=37&type=section&id=Non-GAAP%20Financial%20Measures) - Contribution Margin is defined as Revenue less Cost of Sales before share-based compensation, depreciation, and amortization of developed technology[164](index=164&type=chunk) - Adjusted EBITDA is defined as net income (loss) before specific non-cash and non-recurring adjustments[165](index=165&type=chunk) Non-GAAP Financial Measures (in thousands) | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | | :----------------------------- | :------------------------------------ | :------------------------------------ | | Net loss (GAAP) | $(1,054) | $(1,366) | | Adjusted EBITDA | $580 | $(316) | | Revenue | $14,994 | $13,159 | | Contribution Margin | $2,394 | $1,509 | - Adjusted EBITDA improved from a loss of **$(316) thousand** in Q2 2024 to a profit of **$580 thousand** in Q2 2025[167](index=167&type=chunk) - Contribution Margin increased by **58.6%** from **$1.5 million** in Q2 2024 to **$2.4 million** in Q2 2025[167](index=167&type=chunk) [Liquidity and Capital Resources](index=39&type=section&id=Liquidity%20and%20Capital%20Resources) - Cash and cash equivalents: **$1.9 million** as of June 30, 2025[169](index=169&type=chunk) - Accumulated deficit: **$37.1 million** as of June 30, 2025[182](index=182&type=chunk) - Working capital: **$1.2 million** as of June 30, 2025[182](index=182&type=chunk) - Management anticipates existing cash resources will not be sufficient beyond August 2026 without additional liquidity[180](index=180&type=chunk) - LiveOne's total outstanding consolidated indebtedness was **$15.9 million** as of June 30, 2025, net of fees and discounts, consisting of Initial Debentures and the Capchase Loan[177](index=177&type=chunk) - PodcastOne's assets are collateral for LiveOne's debt[174](index=174&type=chunk) - LiveOne was in compliance with all debt covenants as of June 30, 2025[175](index=175&type=chunk)[191](index=191&type=chunk) [Sources and Uses of Cash](index=42&type=section&id=Sources%20and%20Uses%20of%20Cash) Cash Flow Activities (in thousands) | Cash Flow Activity | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | | :------------------------------------ | :------------------------------------ | :------------------------------------ | | Net cash provided by (used in) operating activities | $903 | $(480) | | Net cash used in investing activities | $(112) | $(74) | | Net cash used in financing activities | $0 | $0 | | Net change in cash, cash equivalents and restricted cash | $791 | $(554) | - Operating cash flow for Q2 2025 benefited from non-cash charges of **$1.7 million** (depreciation, amortization, stock-based compensation) and **$0.3 million** from working capital changes[185](index=185&type=chunk) [Recent Accounting Pronouncements](index=43&type=section&id=Recent%20Accounting%20Pronouncements) - Refer to Note 2 for details on recent accounting pronouncements[192](index=192&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=43&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section states that quantitative and qualitative disclosures about market risk are not required for smaller reporting companies - Not required for smaller reporting companies[193](index=193&type=chunk) [Item 4. Controls and Procedures](index=43&type=section&id=Item%204.%20Controls%20and%20Procedures) As of June 30, 2025, management, including the President and CFO, concluded that the company's disclosure controls and procedures were effective. The report acknowledges inherent limitations in any control system, such as human error or circumvention. No material changes in internal control over financial reporting occurred during the quarter - Disclosure controls and procedures were effective as of June 30, 2025[195](index=195&type=chunk) - No material changes in internal control over financial reporting during Q2 2025[197](index=197&type=chunk) [PART II — OTHER INFORMATION](index=45&type=section&id=PART%20II%20%E2%80%94%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=45&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal proceedings arising from its business activities. Management believes, after consulting legal counsel, that routine claims and lawsuits are not significant and are not expected to have a material adverse effect, except as discussed in Note 7 - Company is involved in various legal proceedings[200](index=200&type=chunk) - Routine claims and lawsuits are not expected to have a material adverse effect, except as discussed in Note 7[200](index=200&type=chunk) [Item 1A. Risk Factors](index=45&type=section&id=Item%201A.%20Risk%20Factors) The company operates in a rapidly changing environment with significant risks, including a history of operating and net losses, substantial indebtedness of its parent LiveOne (guaranteed by PodcastOne and secured by its assets), and reliance on key management. These factors raise substantial doubt about the company's ability to continue as a going concern - PodcastOne has incurred significant operating and net losses since inception, with a net loss of **$1.1 million** for Q2 2025 and an accumulated deficit of **$37.1 million** as of June 30, 2025[202](index=202&type=chunk) - The company's ability to continue as a going concern is dependent on increasing revenue, reducing costs, achieving profitability, and obtaining additional financing[205](index=205&type=chunk)[183](index=183&type=chunk) - Reliance on key management, including Executive Chairman Robert Ellin, President Kit Gray, Chief Revenue Officer Sue McNamara, and CFO Ryan Carhart[206](index=206&type=chunk)[207](index=207&type=chunk) - LiveOne's substantial indebtedness (**$15.9 million** as of June 30, 2025) is guaranteed by PodcastOne and secured by a lien on all of PodcastOne's assets[209](index=209&type=chunk)[213](index=213&type=chunk) - LiveOne's debt agreements contain restrictive covenants that may limit PodcastOne's operating flexibility and cash flow[213](index=213&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=48&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q2 2025, PodcastOne issued 63,542 shares of common stock valued at $0.1 million to consultants and 237,113 shares valued at $0.5 million to LiveOne. These issuances were made in reliance on exemptions from registration under the Securities Act. LiveOne also repurchased 291,459 shares of its and/or PodcastOne's common stock during the quarter - Issued **63,542 common shares** (**$0.1 million**) to various consultants in Q2 2025[216](index=216&type=chunk) - Issued **237,113 common shares** (**$0.5 million**) to LiveOne in Q2 2025[216](index=216&type=chunk) Share Repurchases by LiveOne (or PodcastOne) | Period | Total number of shares (or units) purchased | Average price paid per share (or unit) | Total number of shares (or units) purchased as part of publicly announced plans or programs | Maximum number (or approximate dollar value) of shares (or units) that may yet be purchased under the plans or programs* | | :----------------------------- | :---------------------------------------- | :------------------------------------- | :---------------------------------------------------------------------------------------- | :-------------------------------------------------------------------------------------------------------------------- | | April 1, 2025 – April 30, 2025 | - | $- | - | $6,500,000 | | May 1, 2025 – May 31, 2025 | 24,056 | $0.74 | 24,056 | $6,500,000 | | June 1, 2025 – June 30, 2025 | 267,403 | $0.81 | 291,459 | $6,500,000 | | Total (April 1, 2025 – June 30, 2025) | 291,459 | $- | 291,459 | $6,500,000 | [Item 3. Defaults Upon Senior Securities](index=49&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) No defaults upon senior securities were reported for the period - None[220](index=220&type=chunk) [Item 4. Mine Safety Disclosures](index=49&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[220](index=220&type=chunk) [Item 5. Other Information](index=49&type=section&id=Item%205.%20Other%20Information) No other information was reported for the period - None[221](index=221&type=chunk) [Item 6. Exhibits](index=50&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including the company's organizational documents, equity incentive plans, employment agreements, indemnification agreements, and certifications required by the Sarbanes-Oxley Act - Includes Amended and Restated Certificate of Incorporation and Bylaws[224](index=224&type=chunk) - Lists the Company's 2022 Equity Incentive Plan and employment agreements for key executives[224](index=224&type=chunk) - Contains certifications of Principal Executive Officer and Principal Financial Officer pursuant to Section 302 and 906 of the Sarbanes-Oxley Act[224](index=224&type=chunk) [Signatures](index=51&type=section&id=Signatures) The report is signed by Kit Gray, President (Principal Executive Officer), and Ryan Carhart, Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer), on August 14, 2025 - Signed by Kit Gray, President, and Ryan Carhart, Chief Financial Officer[229](index=229&type=chunk)[230](index=230&type=chunk) - Date: August 14, 2025[230](index=230&type=chunk)

Financial Data and Key Metrics Changes - Revenue for Q1 2026 was $15 million, a 14% increase from $13.1 million in the same quarter last year [12] - Operating loss decreased to $1.05 million from $1.4 million year-over-year, primarily due to lower amortization [12] - Net loss improved to $1.05 million or $0.04 per share, compared to a net loss of $1.4 million or $0.06 per share in the prior year [13] - Adjusted EBITDA turned positive at $600,000, compared to a negative $300,000 in the same quarter last year [13] - The company ended the quarter with zero debt and $1.9 million in cash and cash equivalents [13] Business Line Data and Key Metrics Changes - PodcastOne launched 14 new podcasts, increasing the total to 206 active shows [10] - Video views surged by 218% year-over-year across multiple platforms, indicating strong audience engagement [10] Market Data and Key Metrics Changes - PodcastOne ranked as a top 10 US podcast publisher for the eighth consecutive month, with a monthly unique US audience of 5.4 million and 20.3 million downloads and streams as of July 2025 [8] - The podcast advertising market is projected to see over $2.4 billion in investments this year, highlighting the industry's growth potential [7] Company Strategy and Development Direction - PodcastOne aims to leverage its vertically integrated model to drive long-term value for creators, advertisers, and shareholders [7] - The company is expanding its video production and distribution efforts to enhance audience engagement [11] - PodcastOne is actively exploring M&A opportunities, particularly in acquiring talent and podcast platforms [26][29] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about building on momentum with high-profile initiatives and events planned for the upcoming months [15] - The company expects full-year revenues to be between $56 million and $60 million, representing at least an 8% increase from the previous fiscal year [14] - Adjusted EBITDA for the full year is anticipated to be between $3 million and $5 million [14] Other Important Information - PodcastOne has upgraded its order management system to improve operational efficiency and sales processes [17] - The company is focused on compelling content, strategic monetization, and maintaining trusted relationships with talent and advertisers [17] Q&A Session Summary Question: How does the growth in video views translate into revenue? - Management indicated that current contracts consider both audio and video views, allowing for higher rates per spot due to increased video viewership [21][22] Question: What is the current M&A environment for platforms? - Management noted that the platform side is dominated by a few major players, but there are still interesting opportunities for acquisition [26][29] Question: What factors could drive revenue to the high end of guidance? - Acquiring a company with good revenues could push the numbers higher, while not acquiring would keep it at the lower end [33] Question: How is stock-based compensation affecting cost of sales? - Management confirmed that stock-based compensation is being used to reduce cash payments, which is part of their strategy to manage costs [39][40] Question: How do consumers interact with video podcasts compared to audio-only? - Management noted that video consumption is significant, with many viewers engaging with content actively, while others may listen passively [49][50]

Filing Information This section details the Form 8-K filing, identifying PodcastOne, Inc. as the registrant, confirming its emerging growth company status, and listing registered securities - The filing is a **Form 8-K Current Report** by PODCASTONE, INC., dated July 30, 2025[1](index=1&type=chunk)[2](index=2&type=chunk) - PodcastOne, Inc. is identified as an **'Emerging growth company'**[2](index=2&type=chunk)[4](index=4&type=chunk) Registered Securities | Title of each class | Trading Symbol(s) | Name of each exchange on which registered | | :------------------ | :---------------- | :---------------------------------------- | | Common stock, $0.00001 par value per share | PODC | The NASDAQ Capital Market | [Item 2.02 Results of Operations and Financial Condition](index=2&type=section&id=Item%202.02%20Results%20of%20Operations%20and%20Financial%20Condition) PodcastOne, Inc. announced preliminary unaudited financial results for the fiscal quarter ended June 30, 2025, cautioning against undue reliance due to their preliminary nature [Announcement of Preliminary Financial Results](index=2&type=section&id=Announcement%20of%20Preliminary%20Financial%20Results) The company issued a press release on July 30, 2025, announcing preliminary financial results for the fiscal quarter ended June 30, 2025 - PodcastOne, Inc. issued a press release on July 30, 2025, announcing **preliminary financial results** for its fiscal quarter ended June 30, 2025[5](index=5&type=chunk) - A copy of the press release is attached as **Exhibit 99.1**[5](index=5&type=chunk) [Disclaimer Regarding Preliminary Nature](index=2&type=section&id=Disclaimer%20Regarding%20Preliminary%20Nature) The company emphasizes the preliminary, unaudited nature of financial results, cautioning against undue reliance as they are subject to change and not independently reviewed - The announced results are **preliminary, unaudited, and subject to change** as financial closing procedures are not yet complete[6](index=6&type=chunk) - The preliminary unaudited financial information has not been **audited, reviewed, or compiled** by the Company's independent registered public accounting firm, MGO[7](index=7&type=chunk) - These estimates should not be viewed as a substitute for the Company's full financial statements prepared in accordance with GAAP, and **undue reliance should not be placed on them**[6](index=6&type=chunk) - The information is not deemed 'filed' for purposes of Section 18 of the Securities Exchange Act of 1934, nor incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference[8](index=8&type=chunk) [Item 7.01 Regulation FD Disclosure](index=2&type=section&id=Item%207.01%20Regulation%20FD%20Disclosure) This item incorporates by reference the information disclosed under Item 2.02, ensuring the preliminary financial results announcement is public disclosure under Regulation FD - The information described under Item 2.02 is **incorporated by reference** in this Item 7.01[9](index=9&type=chunk) [Item 9.01 Financial Statements and Exhibits](index=2&type=section&id=Item%209.01%20Financial%20Statements%20and%20Exhibits) This section lists the exhibits furnished with the Form 8-K, including the press release detailing preliminary financial results and the Cover Page Interactive Data File Exhibits Furnished | Exhibit No. | Description | | :---------- | :---------- | | 99.1* | Press release, dated July 30, 2025. | | 104* | Cover Page Interactive Data File (embedded within the Inline XBRL document) | * Furnished herewith. [SIGNATURES](index=3&type=section&id=SIGNATURES) The report is duly signed on behalf of PodcastOne, Inc. by Ryan Carhart, Chief Financial Officer, confirming its authorization and filing on July 30, 2025 - The report was signed by **Ryan Carhart, Chief Financial Officer** of PODCASTONE, INC., on July 30, 2025[13](index=13&type=chunk)[14](index=14&type=chunk)[15](index=15&type=chunk)

Core Insights - PodcastOne reported record revenue of approximately $15 million for Q1 Fiscal 2026, marking a 14% increase from $13.2 million in Q1 Fiscal 2025 [7][9] - The company achieved an Adjusted EBITDA of $580,000, a significant improvement of 284% year-over-year [9][10] - PodcastOne's guidance for Fiscal 2026 anticipates revenues between $55 million and $60 million, with Adjusted EBITDA projected at $3 million to $5 million [10][9] Management Commentary - Kit Gray, President and Co-Founder, emphasized PodcastOne's legacy in the podcasting industry and its commitment to audio-first entertainment, which has set industry standards [2][6] - The company is well-positioned to leverage relationships with over 500 major advertisers, capitalizing on the growing podcasting market [3][6] Industry Context - The podcasting industry is thriving, with over 4 million podcasts globally and advertising revenues expected to exceed $2.4 billion in the current year [3][6] - PodcastOne has expanded its video production efforts, resulting in a 200% increase in video views year-over-year across platforms like YouTube and TikTok [5][6] Financial Performance - Q1 Fiscal 2026 results showed a net loss of $1.054 million, an improvement from a net loss of $1.366 million in the same quarter last year [7][9] - The company reported a Contribution Margin of approximately $2.4 million, representing a 59% increase from the previous year [9][27] Podcast Offerings - PodcastOne added 14 new podcasts in Q1 Fiscal 2026, bringing the total to over 200 on its network [9][4] - The diverse offerings include popular titles such as LOVE MURDER and Detox Retox, catering to a wide audience [4][5]