ACCESS Newswire Inc.

Previous wording

The discussion of the financial condition and results of operations of the Company set forth below should be read in conjunction with the consolidated financial statements and related notes thereto included elsewhere in this Form 10-Q. This Form 10-Q contains forward-looking statements that involve risks and uncertainties. The statements contained in this Form 10-Q that are not purely historical are forward-looking statements within the meaning of Section 27a of the Securities Act and Section 21e of the Exchange Act. When used in this Form 10-Q, or in the documents incorporated by reference into this Form 10-Q, the words “anticipate,” “believe,” “estimate,” “intend” and “expect” and similar expressions are intended to identify such forward-looking statements. Such forward-looking statements include, without limitation, the statements regarding the Company’s strategy, future sales, future expenses, future liquidity, and capital resources. All forward-looking statements in this Form 10-Q are based upon information available to the Company on the date of this Form 10-Q, and the Company assumes no obligation to update any such forward-looking statements. The Company’s actual results could differ materially from those discussed in this Form 10-Q for many reasons. Factors that could cause or contribute to such differences (“Cautionary Statements”) include, but are not limited to, those discussed in Item 1. Business — “Risk Factors” and elsewhere in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, which are incorporated by reference into this Form 10-Q. All subsequent written and oral forward-looking statements attributable to the Company, or persons acting on the Company’s behalf, are expressly qualified in their entirety by the Cautionary Statements.

Current wording

The discussion of the financial condition and results of operations of the Company set forth below should be read in conjunction with the consolidated financial statements and related notes thereto included elsewhere in this Form10-Q. This Form10-Q contains forward-looking statements that involve risks and uncertainties. The statements contained in this Form10-Q that are not purely historical are forward-looking statements within the meaning of Section 27a of the Securities Act and Section 21e of the Exchange Act. When used in this Form10-Q, or in the documents incorporated by reference into this Form 10-Q, the words “anticipate,” “believe,” “estimate,” “intend” and “expect” and similar expressions are intended to identify such forward-looking statements. Such forward-looking statements include, without limitation, the statements regarding the Company’s strategy, future sales, future expenses, future liquidity, and capital resources. All forward-looking statements in this Form10-Q are based upon information available to the Company on the date of this Form10-Q, and the Company assumes no obligation to update any such forward-looking statements. The Company’s actual results could differ materially from those discussed in this Form10-Q for many reasons. Factors that could cause or contribute to such differences (“Cautionary Statements”) include, but are not limited to, those discussed in Item 1. Business — “Risk Factors” and elsewhere in the Company’s Annual Report on Form10-K for the year ended December 31, 2025, which are incorporated by reference into this Form 10-Q. All subsequent written and oral forward-looking statements attributable to the Company, or persons acting on the Company’s behalf, are expressly qualified in their entirety by the Cautionary Statements.

Previous wording

We focus on selling to small and mid-market businesses companies, which we define as companies that have between 2 and 2,000 employees. In late 2024, we launched our new subscription platform to existing customers only, and at the beginning of 2025, officially released it as part of our rebrand to ACCESS Newswire. As of September 30, 2025, we have 972 subscriptions with an annual recurring revenue (“ARR”) of approximately $11.3 million.

Current wording

We focus on selling to small and mid-market businesses, which we define as companies that have between 2 and 2,000 employees. In late 2024, we launched our new subscription platform to existing customers only, and at the beginning of 2025, officially released it as part of our rebrand to ACCESS Newswire. As of March 31, 2026, we had 1,004 subscriptions with an annual recurring revenue (“ARR”) of approximately $12.8 million.

Previous wording

On February 28, 2025, the Company and Direct Transfer, LLC, its wholly owned subsidiary entered into and closed an Asset Purchase Agreement (the “Purchase Agreement”) with Equiniti Trust Company, LLC (the “Buyer”). Pursuant to, and subject to the terms and conditions of, the Purchase Agreement, the Buyer purchased certain assets related to the Company’s Compliance business (the “Purchased Assets”). The Purchased Assets consisted of certain accounts receivable, prepaid assets, contracts and intellectual property, among other things, related to the Company’s services of providing i) disclosure software and services for financial reporting, ii) stock transfer services, iii) annual meeting, print and shareholder distribution and fulfillment services and iv) virtual annual meeting services (but not the intellectual property relating to the virtual annual meeting services). Revenue related to these services was previously included in the Company’s “compliance revenue” stream as reported with the SEC in previous filings, except revenue related to virtual annual meeting services, which was previously reported in the “communications revenue” stream in previous SEC filings. Additionally, revenue related to providing SEDAR services and revenue related to our whistleblower hotline, which was previously reported as “Compliance revenue” was retained by the Company. The Buyer only assumed certain liabilities related to the Purchased Assets, which includes certain accounts payable, accrued liabilities and deferred revenue. As a result, assets associated with our Compliance business, and revenue and expenses associated with the assets, have been categorized as discontinued operations in our financial statements for the three and nine months ended September 30, 2025 and 2024, while the remaining assets associated with our Communications business are included in continuing operations.

Current wording

On February 28, 2025, the Company and Direct Transfer, LLC, its wholly owned subsidiary, entered into and closed an Asset Purchase Agreement (the “Purchase Agreement”) with Equiniti Trust Company, LLC (the “Buyer”). Pursuant to, and subject to the terms and conditions of, the Purchase Agreement, the Buyer purchased certain assets related to the Company’s Compliance business (the “Purchased Assets”). The Purchased Assets consisted of certain accounts receivable, prepaid assets, contracts and intellectual property, among other things, related to the Company’s services of providing i) disclosure software and services for financial reporting, ii) stock transfer services, iii) annual meeting, print and shareholder distribution and fulfillment services and iv) virtual annual meeting services (but not the intellectual property relating to the virtual annual meeting services). Revenue related to these services was previously included in the Company’s “compliance revenue” stream as reported with the SEC in previous filings, except revenue related to virtual annual meeting services, which was previously reported in the “communications revenue” stream in previous SEC filings. Additionally, revenue related to providing SEDAR services and revenue related to our whistleblower hotline, which was previously reported as “Compliance revenue” was retained by the Company. The Buyer only assumed certain liabilities related to the Purchased Assets, which included certain accounts payable, accrued liabilities and deferred revenue. As a result, assets associated with our Compliance business, and revenue and expenses associated with the assets, have been categorized as discontinued operations in our financial statements for the years ended December 31, 2025, while the remaining assets associated with our Communications business are included in continuing operations.

Previous wording

Our platform also includes a seamless e-commerce experience, allowing customers toself-select distribution options, register, and upload their press releases for editorial review within minutes.These innovations have contributed to thehistorical growth of press release distribution products, a trend we anticipate will continue in the coming years.

Current wording

Our platform also includes a seamless e-commerce experience, allowing customers to self-select distribution options, register, and upload their press releases for editorial review within minutes. These innovations have contributed to the historical growth of press release distribution products, a trend we anticipate will continue in the coming years.

Previous wording

Additionally, we maintainhigh gross margins while offeringflexible pricing options, enabling customers to pay per release or opt for long-term contract commitments. Our corepress release distribution service is integrated into all threeACCESS subscription plans, ensuring greater value for our customers.

Current wording

Additionally, we maintain high gross margins while offering flexible pricing options, enabling customers to pay per release or opt for long-term contract commitments. Our core press release distribution service is integrated into all three ACCESS subscription plans, ensuring greater value for our customers.

Previous wording

Our Webcasting Platform is a cloud-based webcast, webinar and virtual meeting platform that delivers live and on-demand streaming of events to audiences of all sizes. Our solution allows customers to create, produce and deliver events, which we feel has significantly strengthened our webcasting product and overall offering. The platform architecture gives us the ability to host thousands of webcasts each year, expanding and diversifying our webcast business from our historical earnings-based events to include any type of virtual event.

Current wording

Our Webcasting Platform is a cloud-based webcast, webinar and virtual meeting platform that allows customers to create, produce and deliver live and on-demand streaming of events to audiences of all sizes. The platform architecture gives us the ability to host thousands of webcasts each year, expanding and diversifying our webcast business from our historical earnings-based events to include any type of virtual event.

Previous wording

Comparison of results of operations for the three and nine months ended September 30, 2025 and 2024 (in thousands):

Current wording

Comparison of results of operations for the three months ended March 31, 2026 and 2025 (in thousands):

Previous wording

As of September 30, 2025, our deferred revenue balance was $5,020,000, which we expect to recognize over the next twelve months, compared to $4,743,000 at December 31, 2024, an increase of 6%. Deferred revenue primarily consists of advance billings for pre-paid packages of our news distribution products as well as advance billings for subscriptions of our cloud-based products.

Current wording

As of March 31, 2026, our deferred revenue balance was $5,390,000, which we expect to recognize over the next twelve months, compared to $5,265,000 at December 31, 2025, an increase of 2%. Deferred revenue primarily consists of advance billings for pre-paid packages of our news distribution products as well as advance billings for subscriptions of our cloud-based products.

Previous wording

Cost of revenues consist primarily of direct labor costs, newswire distribution costs, teleconferencing costs, and third-party licensing costs. Cost of revenues increased $44,000, or 3%, and decreased $178,000, or 4%, during the three and nine months ended September 30, 2025, respectively, as compared to the same periods of 2024. The increase for the three months ended September 30, 2025 was primarily due to increases in distribution costs as we continue to improve our distribution network, partially offset by a reduction in headcount and optimization of our operations teams. Overall gross margin increased $40,000, or 1%, and decreased $233,000, or 2%, during the three and nine months ended September 30, 2025, respectively, as compared to the same periods of 2024. As a result, gross margin percentage remained consistent at 75% and 76% during the three and nine months ended September 30, 2025, respectively, as compared to the same periods of 2024.

Current wording

Cost of revenues consists primarily of direct labor costs, newswire distribution costs, teleconferencing costs, and third-party licensing costs. Cost of revenues increased by $173,000, or 14%, during the three months ended March 31, 2026, as compared to the same period of 2025. The increase was primarily due to an increase in distribution costs as well as employee-related expenses. Overall gross margin decreased $322,000, or 8%, during the three months ended March 31, 2026, compared to the same period of 2025. As a result, gross margin percentage decreased to 74% during the three months ended March 31, 2026, as compared to 78% during the same period of 2025.

Previous wording

General and administrative expenses consist primarily of salaries, bonuses, stock-based compensation, insurance, fees for professional services, general corporate expenses (including bad debt expense) and facility and equipment expenses. General and administrative expenses decreased $409,000 or 22%, and $185,000, or 3%, during the three and nine months ended September 30, 2025, respectively, as compared to the same periods of 2024. The decrease for the three months ended September 30, 2025, compared to the prior year is primarily due to a reduction in employee related expenses, provision for credit losses, as well as indirect costs associated with the Compliance business. For the nine months ended September 30, 2025, this is partially offset by a benefit to stock compensation expense of $340,000 recorded during the nine months ended September 30, 2024, as a result of the resignation of an executive officer.

Current wording

General and administrative expenses consist primarily of salaries, bonuses, stock-based compensation, insurance, fees for professional services, general corporate expenses (including bad debt expense) and facility and equipment expenses. General and administrative expenses were $1,781,000 for the three months ended March 31, 2026, a decrease of $172,000 or 9%, as compared to the same period of 2025. The decrease is primarily driven by a decrease in bad debt expense.

Previous wording

As a percentage of revenue, general and administrative expenses were 26% and 31% for the three and nine months ended September 30, 2025, respectively, as compared to 34% and 31% for the same periods of 2024.

Current wording

As a percentage of revenue, general and administrative expenses were 33% for the three months ended March 31, 2026, as compared to 36% for the same period of 2025.

Previous wording

Sales and marketing expenses consist primarily of salaries, stock-based compensation, sales commissions, advertising expenses, tradeshow expenses and other marketing expenses. Sales and marketing expenses increased $34,000, or 2%, and decreased $924,000, or 16%, for the three and nine months ended September 30, 2025, respectively, as compared to the same periods of 2024. The decrease for the nine months ended September 30, 2025 is primarily due to lower employee-related expenses and headcount during the first six months of the year, however, for the three months ended September 30, 2025, is more comparable to the prior year.

Current wording

Sales and marketing expenses consist primarily of salaries, stock-based compensation, sales commissions, advertising expenses, tradeshow expenses and other marketing expenses. Sales and marketing expenses were $1,681,000 for the three months ended March 31, 2026, an increase of $87,000, or 5%, as compared to the same period of 2025. This increase is primarily due to higher advertising expenses as we increased the promotion of our new brands.

Previous wording

As a percentage of revenue, sales and marketing expenses were 28% for the three and nine months ended September 30, 2025, as compared to 28% and 33% for the same periods of 2024.

Current wording

As a percentage of revenue, sales and marketing expenses were 32% for the three months ended March 31, 2026, as compared to 29% for the same period of 2025.

Previous wording

Product development expenses consist primarily of salaries, stock-based compensation, bonuses, and licenses to develop new products and technology to complement and/or enhance our platform. Product development expenses increased $13,000, or 2%, and 28,000, or 1%, during the three and nine months ended September 30, 2025, respectively, as compared to the same periods of 2024. The increase is primarily due to a reduction in capitalized software development, partially offset by decreases in headcount and consultants. No costs were capitalized during the three months ended September 30, 2025, while $23,000 was capitalized during the nine months ended September 30, 2025. During the three and nine months ended September 30, 2024, we capitalized $137,000 and $537,000, respectively.

Current wording

Product development expenses consist primarily of salaries, stock-based compensation, bonuses, and licenses to develop new products and technology to complement and/or enhance our platform. Product development expenses decreased $173,000, or 24%, to $560,000 during the three months ended March 31, 2026, as compared to the same period of 2025. The decrease is primarily due to higher capitalization of software, as $99,000 was capitalized during the three months ended March 31, 2026 compared to $23,000 during the same period of 2025. Additionally, consulting expenses decreased as compared to the same period of 2025.

Previous wording

As a percentage of revenue, product development expenses were 12% for the three and nine months ended September 30, 2025 and 2024.

Current wording

As a percentage of revenue, product development expenses were 10% for the three months ended March 31, 2026 compared to 13% for the same period of 2025.

Previous wording

We recognized interest expense of $57,000 and $325,000 for the three and nine months ended September 30, 2025, respectively, compared to $280,000 and $1,183,000 during the same periods of 2024, which is all related to our long-term credit agreement. The decrease in interest expense for the three and nine months ended September 30, 2025, is due to the reduction in debt as a result of the pay down from the sale of the compliance business. These amounts are offset by interest income on deposit and money market accounts of $264,000 and $347,000 for the three and nine months ended September 30, 2025, respectively, compared to $15,000 and $83,000 for the same periods of the prior year.

Current wording

We recognized interest expense of $43,000 for the three-month period ended March 31, 2026, compared to $214,000 during the same period of 2025, which is all related to our long-term credit agreement. The decrease in interest expense for the three months ended March 31, 2026, is due to the reduction in debt as a result of the pay down from the sale of the compliance business. These amounts are offset by interest income on deposit and money market accounts of $5,000 and $10,000 for the three months ended March 31, 2026 and 2025, respectively.

Previous wording

Other income (expense) represents the change in fair value of our interest rate swap.

Current wording

Other income (expense) represents the change in fair value of our interest rate swap. For the three months ended March 31, 2026, Other income (expense) also includes rental income from our office sub-lease of $12,000.

Previous wording

We recognized an income tax expense of $67,000 and a benefit of $127,000 for the three and nine-month periods ended September 30, 2025, respectively, compared to income tax benefit of $347,000 and $642,000 for the three and nine-month periods ended September 30, 2024. For the three and nine-month periods ended September 30, 2025 and 2024, the variance between our effective tax rate and the U.S. statutory rate of 21% is primarily attributable to state income tax, a benefit related to the Foreign Derived Intangible Income ("FDII") deduction and a lower statutory tax rate applied to the Company's Canadian income. This is partially offset by additional expense associated with vesting of stock-based compensation awards

Current wording

We recognized income tax benefit of $121,000 and $185,000 for the three-month periods ended March 31, 2026 and 2025. For the three-month periods ended March 31, 2026 and 2025, the variance between our effective tax rate and the U.S. statutory rate of 21% is primarily attributable to state income tax, a benefit related to the Foreign Derived Intangible Income (“FDII”) deduction and a lower statutory tax rate applied to our Canadian income. This is partially offset by additional expense associated with vesting of stock-based compensation awards.

Previous wording

As of September 30, 2025, we had $3,261,000 in cash and cash equivalents and $4,137,000 in net accounts receivable. Current liabilities from continuing operations as of September 30, 2025, totaled $10,847,000 including the current portion of our long-term debt, accounts payable, deferred revenue, accrued payroll liabilities, income taxes payable, current portion of lease liabilities and other accrued expenses.

Current wording

As of March 31, 2026, we had $3,487,000 in cash and cash equivalents and $3,596,000 in net accounts receivable. Current liabilities as of March 31, 2026, totaled $9,862,000 including the current portion of our long-term debt, accounts payable, deferred revenue, accrued payroll liabilities, income taxes payable, current portion of lease liabilities and other accrued expenses.

Previous wording

As of September 30, 2025, our current liabilities from continuing operations exceeded our current assets from continuing operations by $1,846,000. While our current liabilities from continuing operations exceed current assets from continuing operations, we believe our ability to renegotiate our Credit Agreement and ability to continue to generate cash will benefit us in the future.

Current wording

As of March 31, 2026, our current liabilities exceeded our current assets by $1,191,000. While our current liabilities exceed current assets, we believe our ability to renegotiate our Credit Agreement (as defined in Note 9) and ability to continue to generate cash will benefit us in the future.

Previous wording

As of September 30, 2025, the aggregate principal amount of our Revolving LOC was $1,500,000 and is set to expire June 30, 2026. We currently have no plans to utilize the Revolving LOC but may do so in the future. If the Company does utilize any funds under the Revolving LOC, the funds will bear interest at a per annum rate equal to the then current SOFRplus 2.05%. As of September 30, 2025, there was no outstanding balance under the Revolving LOCand the interest rate was 6.36%.

Current wording

As of March 31, 2026, the aggregate principal amount available under our Revolving LOC was $1,500,000 and is set to expire June 30, 2026. We currently have no plans to utilize the Revolving LOC but may do so in the future. If the Company does utilize any funds under the Revolving LOC, the funds will bear interest at a per annum rate equal to the then current SOFR plus 2.05%. As of March 31, 2026, there was no outstanding balance under the Revolving LOC and the interest rate was 5.72%. See Note 9 to our financial statements for additional information.

Previous wording

Free cash flow, a non-GAAP measure, represents cash flow from operating activities less purchase of property and equipment and capitalized software. Adjusted free cash flow also deducts certain cash payments which the Company believe to be non-recurring in nature. Management considers free cash flow and adjusted free cash flow to be liquidity measures that provide useful information to investors about the amount of cash generated or used by the business.

Current wording

Free cash flow, a non-GAAP measure, represents cash flow from operating activities less purchases of property and equipment and capitalized software. Adjusted free cash flow also deducts certain cash payments which the Company believe to be non-recurring in nature. Management considers free cash flow and adjusted free cash flow to be liquidity measures that provide useful information to investors about the amount of cash generated or used by the business.

Previous wording

A reconciliation of net income to adjusted EBITDA for the three and nine months ended September 30, 2025 and 2024 is presented in the following table (in thousands):

Current wording

A reconciliation of net income to adjusted EBITDA for the years ended March 31, 2026 and 2025 is presented in the following table (in thousands):

Previous wording

For the three and nine months ended September 30, 2025 and 2024, free cash flow and adjusted free cash flow were as follows (in thousands):

Current wording

For the three months ended March 31, 2026 and 2025, free cash flow and adjusted free cash flow were as follows (in thousands):

Previous wording

Market factors like the current military conflicts in Ukraine, Israel and the Middle East, tariff wars, instability in global energy markets, global inflation and fluctuations in interest rates have contributed to significant global economic and political uncertainty, disrupted global trade and supply chains, adversely impacted many industries, and contributed to significant volatility in financial markets. Overall, despite many uncertainties in the market regarding the economic and political outlook, we believe the demand for our platforms and services is stable in a majority of the markets we serve.

Current wording

Market factors like the current military conflicts in Ukraine, Iran and the Middle East overall, tariff wars, instability in global energy markets, global inflation and the increase of interest rates have contributed to significant global economic and political uncertainty, disrupted global trade and supply chains, adversely impacted many industries, and contributed to significant volatility in financial markets. Overall, despite many uncertainties in the market regarding the economic and political outlook, we believe the demand for our platforms and services is stable in a majority of the markets we serve.

Previous wording

We also believe the continued transition to a platform subscription model has been and will continue to be key for our long-term sustainable growth. We will also continue to focus on the following key strategic initiatives during the remainder of 2025 and into 2026:

Current wording

We also believe the continued transition to a platform subscription model has been and will continue to be key for our long-term sustainable growth. We will also continue to focus on the following key strategic initiatives during the remainder of 2025: