Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-Q Commission file number 1-32600 TUCOWS INC. (Exact Name of Registrant as Specified in Its Charter) (State or Other Jurisdiction of (I.R.S. Employer Incorporation or Organization) Identification No.) Pennsylvania 23-2707366 For the quarterly period ended March 31, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to ☒ QUARTERLY REPORT ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K FOR ANNUAL AND TRANSITION REPORTS PURSUANT TO SECTIONS 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number 001-32600 (Exact Name of Registrant as Specifie ...

[Executive Summary](index=1&type=section&id=Executive%20Summary) This section highlights Tucows' strong Q4 2023 performance, achieving high-end Adjusted EBITDA guidance driven by Wavelo's growth and consistent Domains performance [Q4 2023 Highlights](index=1&type=section&id=Q4%202023%20Highlights) Tucows concluded 2023 at the high end of its Adjusted EBITDA guidance, fueled by Wavelo's growth and consistent Domains performance, alongside significant Q4 operating cash flow improvement - Achieved high end of Adjusted EBITDA guidance for 2023, primarily due to robust growth from Wavelo and consistent performance from Tucows Domains[3](index=3&type=chunk) - Consolidated revenue grew **10% year-over-year** in Q4 2023[3](index=3&type=chunk) Q4 2023 Operating Cash Flow | Metric | Q4 2023 (Millions USD) | Q4 2022 (Millions USD) | Change (%) | | :----- | :--------------------- | :--------------------- | :--------- | | Operating Cash Flow | $9.0 | $2.9 | 210% | - The company continued to make growth investments in Ting and Wavelo businesses and deleveraged the business by making payments on syndicated debt using cash flow from Wavelo and Tucows Domains[3](index=3&type=chunk) [Consolidated Financial Performance](index=1&type=section&id=Consolidated%20Financial%20Performance) Tucows' consolidated financial performance in Q4 and full year 2023 showed mixed results, with revenue growth but significant declines in profitability metrics due to investments and expenses [Q4 2023 Consolidated Results](index=1&type=section&id=Q4%202023%20Consolidated%20Results) Tucows reported a **10.2% increase** in Q4 2023 consolidated net revenue, but net loss widened and Adjusted EBITDA decreased due to Ting Fiber investments and higher interest expenses Q4 2023 Consolidated Financial Highlights | Metric | Q4 2023 (Thousands USD) | Q4 2022 (Thousands USD) | Change (%) | | :-------------------------- | :---------------------- | :---------------------- | :--------- | | Net Revenues | 86,958 | 78,909 | 10.2% | | Gross Profit | 17,821 | 17,010 | 4.8% | | Net Income (Loss) | (23,374) | (13,445) | (74)% | | Basic earnings (Loss) per share | (2.14) | (1.25) | (71)% | | Adjusted EBITDA | 2,554 | 6,700 | (62)% | | Net cash by (used in) operating activities | 9,003 | 2,901 | 210% | - The increase in net loss and decrease in Adjusted EBITDA were primarily due to costs from continued investment in the Ting Fiber network and operations, network depreciation, and higher interest expenses[6](index=6&type=chunk)[7](index=7&type=chunk) Cash Equivalents | Metric | Q4 2023 (Millions USD) | Q3 2023 (Millions USD) | Q4 2022 (Millions USD) | | :------------------------------------------------ | :--------------------- | :--------------------- | :--------------------- | | Cash equivalents, restricted cash and restricted cash equivalents | $92.7 | $110.7 | $23.5 | [Full Year 2023 Consolidated Results](index=2&type=section&id=Full%20Year%202023%20Consolidated%20Results) For FY2023, Tucows saw modest net revenue growth but significant declines in gross profit, net income, and Adjusted EBITDA, shifting to net cash used in operations Full Year 2023 Consolidated Financial Highlights | Metric | FY 2023 (Thousands USD) | FY 2022 (Thousands USD) | Change (%) | | :-------------------------- | :---------------------- | :---------------------- | :--------- | | Net Revenues | 339,337 | 321,142 | 5.7% | | Gross Profit | 66,667 | 78,248 | (15)% | | Net Income (Loss) | (96,197) | (27,571) | (249)% | | Basic earnings (Loss) per share | (8.85) | (2.56) | (246)% | | Adjusted EBITDA | 15,451 | 37,590 | (59)% | | Net cash by (used in) operating activities | (4,771) | 19,876 | (124)% | [Segment Performance Overview](index=3&type=section&id=Segment%20Performance%20Overview) An overview of Q4 2023 segment performance reveals varied results across Ting, Wavelo, and Domains, with Wavelo showing strong growth and Ting facing increased investment costs [Ting Internet Services](index=3&type=section&id=Ting%20Internet%20Services) Ting Internet Services reported Q4 2023 revenue growth but a significant Adjusted EBITDA decline due to network expansion and operating capacity investments Ting Internet Services - Q4 Performance | Metric | Q4 2023 (Thousands USD) | Q4 2022 (Thousands USD) | | :---------------- | :---------------------- | :---------------------- | | Revenue | 13,821 | 11,470 | | Gross Margin | 7,881 | 7,211 | | Adj. EBITDA | (12,366) | (6,011) | [Wavelo Platform Services](index=3&type=section&id=Wavelo%20Platform%20Services) Wavelo Platform Services achieved robust Q4 2023 growth, more than doubling revenue and significantly improving Adjusted EBITDA to a positive figure Wavelo Platform Services - Q4 Performance | Metric | Q4 2023 (Thousands USD) | Q4 2022 (Thousands USD) | | :---------------- | :---------------------- | :---------------------- | | Revenue | 9,545 | 4,479 | | Gross Margin | 9,214 | 3,807 | | Adj. EBITDA | 2,604 | (1,142) | [Tucows Domain Services](index=3&type=section&id=Tucows%20Domain%20Services) Tucows Domain Services maintained consistent Q4 2023 performance with slight increases in revenue, gross margin, and Adjusted EBITDA, driven by wholesale and retail growth Tucows Domain Services - Q4 Performance | Metric | Q4 2023 (Thousands USD) | Q4 2022 (Thousands USD) | | :-------------------------------- | :---------------------- | :---------------------- | | Wholesale Domain Services Revenue | 48,279 | 46,742 | | Value Added Services Revenue | 4,184 | 4,583 | | Total Wholesale Revenue | 52,463 | 51,325 | | Retail Revenue | 9,348 | 8,943 | | Total Tucows Domain Services Revenue | 61,811 | 60,268 | | Total Tucows Domain Services Gross Margin | 18,858 | 18,402 | | Total Tucows Domain Services Adj. EBITDA | 10,794 | 10,568 | [Corporate and Network Expenses](index=3&type=section&id=Corporate%20and%20Network%20Expenses) The Corporate segment saw decreased revenue and Adjusted EBITDA in Q4 2023, while network expenses, including depreciation, significantly increased, impacting gross profit Corporate - Q4 Performance | Metric | Q4 2023 (Thousands USD) | Q4 2022 (Thousands USD) | | :-------------------------- | :---------------------- | :---------------------- | | Mobile Services and Eliminations Revenue | 1,781 | 2,692 | | Mobile Services and Eliminations Gross Margin | (201) | 244 | | Mobile Services and Eliminations Adj. EBITDA | 1,522 | 3,285 | Network Expenses - Q4 Impact on Gross Margin | Metric | Q4 2023 (Thousands USD) | Q4 2022 (Thousands USD) | | :-------------------------------------- | :---------------------- | :---------------------- | | Network, other costs | (7,584) | (4,245) | | Network, depreciation of property and equipment | (9,533) | (7,969) | | Network, amortization of intangible assets | (371) | (378) | | Network, impairment | (143) | (62) | | Total Network Expenses | (17,631) | (12,654) | [Non-GAAP Financial Measures](index=3&type=section&id=Non-GAAP%20Financial%20Measures) This section defines Adjusted EBITDA as a non-GAAP measure, explaining its rationale for assessing core business performance and providing a detailed reconciliation [Adjusted EBITDA Definition and Rationale](index=3&type=section&id=Adjusted%20EBITDA%20Definition%20and%20Rationale) Tucows utilizes Adjusted EBITDA as a non-GAAP measure to clarify core business operational and financial performance, excluding non-cash and non-recurring charges - Adjusted EBITDA is a non-GAAP measure used to assist financial statement users in assessing historical performance and evaluating the operational and financial performance of the Company's core business[15](index=15&type=chunk)[16](index=16&type=chunk) - Adjusted EBITDA excludes depreciation, impairment, amortization of intangible assets, income tax provision, interest expense (net), accretion of contingent consideration, stock-based compensation, asset impairment, gains/losses from unrealized foreign currency transactions, loss on debt extinguishment, and acquisition/transition costs[17](index=17&type=chunk) - The company cautions that Adjusted EBITDA may not be comparable to other companies' measures, should not be considered in isolation, and is not a substitute for GAAP measures or a liquidity measure[16](index=16&type=chunk) [Adjusted EBITDA Reconciliation](index=5&type=section&id=Adjusted%20EBITDA%20Reconciliation) The reconciliation table details adjustments from Net Income (Loss) to Adjusted EBITDA for three and twelve months, highlighting non-cash and non-operating item impacts Reconciliation of Net Income (Loss) to Adjusted EBITDA (Thousands USD) | Item | 3 Months ended Dec 31, 2023 | 3 Months ended Dec 31, 2022 | 12 Months ended Dec 31, 2023 | 12 Months ended Dec 31, 2022 | | :---------------------------------------------------------------- | :-------------------------- | :-------------------------- | :--------------------------- | :--------------------------- | | Net income (Loss) for the period | (23,374) | (13,445) | (96,197) | (27,571) | | Less: | | | | | | Provision (recovery) for income taxes | (1,316) | (1,006) | (6,873) | (217) | | Depreciation of property and equipment | 9,661 | 8,124 | 36,431 | 28,187 | | Impairment of property and equipment | 143 | 62 | 4,822 | 553 | | Amortization of intangible assets | 2,728 | 2,866 | 10,829 | 11,394 | | Interest expense, net | 12,651 | 5,901 | 41,771 | 14,456 | | Loss on debt extinguishment | - | - | 14,680 | - | | Accretion of contingent consideration | - | 50 | - | 248 | | Stock-based compensation | 1,528 | 3,203 | 8,134 | 7,599 | | Unrealized loss (gain) on foreign exchange revaluation | (316) | (166) | (62) | 281 | | Acquisition and transition costs* | 849 | 1,111 | 1,916 | 2,660 | | **Adjusted EBITDA** | **2,554** | **6,700** | **15,451** | **37,590** | [Company Information & Investor Relations](index=5&type=section&id=Company%20Information%20%26%20Investor%20Relations) This section provides an overview of Tucows' business, its key brands, and details regarding investor relations communications and contacts [About Tucows](index=6&type=section&id=About%20Tucows) Tucows is a global internet services leader connecting people through communications service technology, domain services, and fiber-optic internet infrastructure - Tucows helps connect people to internet access through communications service technology, domain services, and fiber-optic internet infrastructure[21](index=21&type=chunk) - Key brands include Ting (fixed fiber Internet access), Wavelo (telecommunications software suite for service providers), Tucows Domains (manages ~25 million domain names), and Hover (domain and email management for individuals/small businesses)[21](index=21&type=chunk)[22](index=22&type=chunk) [Investor Relations and Management Commentary](index=5&type=section&id=Investor%20Relations%20and%20Management%20Commentary) Tucows offers pre-recorded audio commentary and transcripts for quarterly results, with a process for shareholder questions and a dedicated investor relations contact - Management's pre-recorded audio commentary and transcript for Q4 2023 results were posted on February 22, 2024[19](index=19&type=chunk) - Shareholders, analysts, and prospective investors could submit questions to management from February 22 to February 29, 2024, with responses posted on March 12, 2024[20](index=20&type=chunk) - Contact for investor relations is Monica Webb, Vice President, Investor Relations[24](index=24&type=chunk) [Legal Disclosures](index=6&type=section&id=Legal%20Disclosures) This section contains standard forward-looking statements regarding future financial results and growth, subject to inherent uncertainties and risks [Forward-Looking Statements](index=6&type=section&id=Forward-Looking%20Statements) This section includes standard forward-looking statements about future financial results and growth, subject to inherent uncertainties and risks, with no obligation to update - The release contains forward-looking statements concerning future financial results and growth expectations, including synergies from the Enom acquisition and Ting Internet growth[23](index=23&type=chunk) - These statements are based on management's current expectations and are subject to uncertainties and risks that could cause actual results to differ materially[23](index=23&type=chunk) - Tucows assumes no obligation to update any forward-looking statements, except as required by law[23](index=23&type=chunk)

Tucows Inc. (NASDAQ:TCX) Q4 2023 Earnings Conference Call February 22, 2024 5:05 PM ET Company Participants Monica Webb - Director of Market Development and Government Affairs Elliot Noss - President and CEO Dave Woroch - CEO, Tucows Domains Justin Reilly - CEO, Wavelo Dave Singh - CFO Conference Call Participants Monica Webb Welcome to Tucows Fourth Quarter 2023 Management Commentary. We have prerecorded prepared remarks regarding the quarter and outlook for the company. A Tucows-generated transcript of th ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 1-32600 TUCOWS INC. (Exact Name of Registrant as Specified in Its Charter) (State or Other Jurisdiction of (I.R.S. Employer ...

Tucows Inc. (NASDAQ:TCX) Q3 2023 Earnings Conference Call November 2, 2023 8:00 PM ET Company Participants Monica Webb - Director of Market Development and Government Affairs Elliot Noss - President and CEO Dave Woroch - CEO of Tucows Domains Services Justin Reilly - CEO of Wavelo Davinder Singh - CFO Conference Call Participants Monica Webb Welcome to Tucows’ Third Quarter 2023 Management Commentary. We have prerecorded prepared remarks regarding the quarter and outlook for the company. A Tucows-generated ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 1-32600 TUCOWS INC. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-acce ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-Q ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 1-32600 TUCOWS INC. ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 OR Pennsylvania 23-2707366 96 Mowat Avenue, Toronto, Ontario M6K 3M1, Canada (Address of Principal Executive O ...

Infrastructure and Services - As of December 31, 2022, Ting Internet had access to 96,000 owned infrastructure serviceable addresses, up from 76,000 in 2021, and 35,000 active accounts, an increase from 26,000[23]. - Tucows aims to expand its Ting Internet services into new and existing markets, focusing on reliable Fiber and Fixed Wireless Internet services[22]. - Revenues from Ting are generated in the U.S. and billed on a monthly basis with no fixed contract terms, focusing on providing reliable Fiber and Fixed Wireless Internet services[22]. - The company aims to expand its Ting Internet footprint by obtaining additional financing to support the build-out of fiber networks into selected towns and cities[14]. - The company has made significant investments in its domain services, which include OpenSRS, eNom, Ascio, and EPAG[20]. Software and Technology - Wavelo's software solutions, including MONOS and ISOS, have been integrated into Ting Internet to enable faster subscriber growth and footprint expansion[24]. - Wavelo provides full-service platforms and professional services for Communication Services Providers (CSPs), focusing on subscription and billing management, network orchestration, and developer tools[24]. - Wavelo's revenues from its Mobile Network Operating System (MONOS), Internet Service Operating System (ISOS), Subscriber Management (SM) software, and professional services are primarily generated in the U.S.[24]. - Tucows' product suite for Wavelo is modular, allowing for integration with other best-in-class software, enhancing operational efficiency for customers[54]. Domain Management - Tucows Domains manages 24 million domain names under its registrar accreditations, contributing to a robust revenue stream from domain registration services[28]. - Tucows Domains generates revenue from registration fees for new, renewed, and transferred domain name registrations, as well as from value-added services[25]. - The retail segment includes the sale of domain name registration and email services, with a focus on personal names based on over 36,000 surname domains[30]. - The primary distribution channel for Tucows Domains is a global network of about 35,000 resellers operating in over 150 countries[26]. Organizational Structure and Workforce - The company has restructured its reporting segments into Ting, Wavelo, and Tucows Domains to better align with its operational focus and management strategies[20]. - Tucows has approximately 1,020 full-time employees and 80 contracted employees globally, with 55% based in Canada and 35% in the U.S.[50]. - Approximately 450 employees support the Ting segment, while 180 support Wavelo, and 260 support Tucows Domains[50]. - The company emphasizes a flexible, remote-first work environment, allowing employees to choose their work style[52]. - The company offers competitive compensation, including employee stock options and health benefits[51]. Governance and Compliance - The company remains active in Internet governance and is recognized as a defender of end-user rights and reseller-friendly business practices[32]. - Tucows has registered the Tucows trademark in the U.S., Canada, and the European Union, ensuring protection of its intellectual property rights[33]. - The company is committed to an Open Internet and does not engage in practices like blocking or throttling content[61]. - The Wavelo Segment is less subject to government regulations, focusing on subscription and billing management[63]. - Tucows Domains segment is governed by ICANN and various federal and state laws, impacting domain name registration capabilities[64]. - Compliance with GDPR could result in fines up to 4% of the company's annual total revenue for violations[68]. - The company operates under the filing requirements of the Securities Exchange Act of 1934, ensuring transparency in financial reporting[73]. Financial Performance and Strategy - The business model is characterized by non-refundable, up-front payments leading to recurring revenue from renewals, contributing to positive operating cash flow[27]. - The management regularly reviews revenue for each service offering to forecast growth and monitor the effectiveness of operational strategies[21]. - The company has a focus on increasing the number of services offered to generate higher revenues[14]. - The company faces significant competition from traditional BSS/OSS providers and retail-oriented domain registrars, impacting its market strategies[42]. - No customer represented more than 10% of consolidated revenues in any of the last three fiscal years, indicating a diversified customer base[37]. Leadership - The Chief Executive Officer reviews the operating results of the three segments to make key operating decisions and evaluate segment performance[20]. - The Chief Financial Officer has been with the company since 2017, previously holding roles at KPMG and TELUS[77]. - The Chief Executive Officer of Tucows Domains has led the business since 2014, overseeing multiple domain services[78]. - The Chief Operating Officer joined in 2022, bringing experience from previous COO roles in other organizations[80]. Health and Safety - Tucows has implemented a vaccination policy for employees who work in offices or meet customers in person, ensuring safety during the COVID-19 pandemic[53]. - The company has established a Fiber Internet install solution to minimize risks associated with person-to-person contact during the COVID-19 pandemic[53].

Tucows Inc. (NASDAQ:TCX) Q4 2022 Earnings Conference Call February 9, 2023 5:00 PM ET Company Participants Monica Webb - Director of Market Development and Government Affairs Elliot Noss - President and CEO Dave Woroch - CEO of Tucows Domains Services Justin Reilly - CEO of Wavelo Davinder Singh - CFO Conference Call Participants Monica Webb Welcome to Tucows’ Fourth Quarter 2022 management commentary. We have pre-recorded prepared remarks regarding the quarter and outlook for the company. A Tucows-generate ...