Zedge, Inc. Announces Robust Q3 Fiscal 2026 Results: Subscription Growth, Enterprise AI, and Enhanced Financials
New York, NY – June 11, 2026: Zedge, Inc. (NYSE AMERICAN: ZDGE), a leading operator of creator communities and mobile personalization platforms, released its third quarter fiscal 2026 financial results, highlighting strong growth in subscription revenue, operational resilience, and new enterprise milestones. The results cover the quarter ended April 30, 2026.
Key Financial Highlights
- Total Revenue: Increased 3.0% year-over-year to \$8.0 million.
- GAAP Net Income: \$0.9 million, up sharply from \$0.2 million last year; diluted EPS at \$0.07 versus \$0.01.
- Free Cash Flow: Rose 55% year-over-year to \$1.2 million.
- Cash and Cash Equivalents: Strengthened to \$19.7 million, with no debt.
- Quarterly Dividend: Increased by 25% to \$0.02 per share.
- Share Repurchase Authorization: Post-quarter, the board expanded buyback capacity by \$2 million, totaling \$2.2 million.
Operational Performance
- Subscription Revenue: Up 32% year-over-year to \$1.7 million; active subscriptions surged 41% to nearly 1.3 million, continuing a multi-quarter trend.
- ARPMAU (Average Revenue Per Monthly Active User): Increased 21% to \$0.119, reflecting improved monetization.
- Zedge Premium Gross Transaction Value (GTV): Grew 17% year-over-year.
- iOS Revenue: Within Zedge Marketplace, iOS revenue jumped 35% year-over-year, indicating successful expansion into premium markets.
- Advertising Revenue: While overall advertising revenue declined by 4% year-over-year, this was entirely due to Emojipedia’s performance amid Google search result changes. Zedge Marketplace advertising revenue remained flat, despite last year’s one-time bonus.
- Deferred Revenue: Increased 25.7% to \$6.2 million.
Strategic & Innovation Highlights
- DataSeeds.AI: Achieved its first six-figure enterprise order, fulfilled for a leading technology company—demonstrating Zedge’s ability to scale and deliver managed, multimodal datasets for frontier AI developers.
- Product Innovation: Four alpha products are live, with the company on track to launch six this fiscal year. Zedge’s innovation strategy emphasizes rapid validation, accelerated build cycles, and strict KPI-based investment.
Key Zedge Marketplace Metrics
- Monthly Active Users (MAU): 19.6 million, down 11.3% year-over-year. Well-developed markets MAU decreased 17.3%, while emerging markets MAU declined 9.5%.
- Active Subscriptions: 1,260,000, up 40.6% from 896,000 last year.
- ARPMAU: \$0.119, up from \$0.099 last year.
- Zedge Premium GTV: \$0.72 million, up 16.6%.
Balance Sheet Overview
- Total Assets: \$34.3 million.
- Total Liabilities: \$9.7 million.
- Stockholders’ Equity: \$24.6 million.
- Treasury Stock: 2,715 shares at a cost of \$8.1 million.
Cash Flow Analysis
- Net Cash Provided by Operating Activities: \$2.9 million for the nine months ended April 30, 2026.
- Net Cash Used in Investing Activities: \$0.3 million.
- Net Cash Used in Financing Activities: \$1.7 million, including \$1.1 million for share buybacks and \$0.7 million for dividends.
Shareholder Information & Price Sensitive Highlights
- Dividend Increase: The quarterly dividend was raised by 25%, signaling confidence in ongoing cash generation and financial health.
- Share Buybacks: Expanded repurchase authorization post-quarter by \$2 million, reflecting management’s belief in the share value and potentially supporting share price.
- Enterprise AI Expansion: DataSeeds.AI’s first six-figure B2B deal marks a new revenue stream and validates Zedge’s execution capabilities in the enterprise space.
- Subscription Growth vs. MAU Decline: Despite a drop in MAU, subscription revenue and ARPMAU are rising, indicating a shift towards higher-value, recurring users and improved monetization.
- Restructuring, Asset Impairments, and Innovation: Zedge continues to invest in new products while managing asset impairments and restructuring costs, demonstrating a focus on long-term value creation.
- No Debt: Zedge maintains a debt-free balance sheet, providing flexibility for future investments or shareholder returns.
Forward-Looking Statements
Management remains focused on acquiring and retaining higher-value users, expanding premium offerings, and pursuing new B2B opportunities. The company’s robust cash flow and balance sheet support continued innovation, dividends, and share repurchases.
Conference Call Details
Management will host an earnings call at 4:30 pm Eastern, including discussion on results, outlook, and strategy, followed by investor Q&A. Webcast Link
About Zedge
Zedge serves 20 million monthly active users across its platforms. The Zedge Marketplace is a leading personalization content marketplace powered by a vibrant creator ecosystem and generative AI. DataSeeds.AI delivers managed datasets for AI developers, drawing from proprietary creator communities and crowdsourced content.
Investor Takeaways
- Strong subscription growth, rising ARPMAU, and robust free cash flow point to improved business fundamentals.
- Dividend increase and expanded buyback authorization are positive signals for shareholder returns and may support share price.
- DataSeeds.AI’s enterprise milestone is potentially transformative, opening new revenue channels.
- Management’s focus on innovation, cost discipline, and monetizing premium users underpins future growth prospects.
- MAU softness bears monitoring, but the shift to higher-value subscriptions is a positive offset.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Forward-looking statements are subject to risks and uncertainties. Investors should review Zedge’s SEC filings and earnings materials before making investment decisions.
