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VerticalScope Announces Second Quarter 2025 Financial Results

Unless otherwise stated, all amounts are in US dollars.

TORONTO--(BUSINESS WIRE)-- VerticalScope Holdings Inc. (鈥淰erticalScope鈥� or the 鈥淐ompany鈥�) (TSX: FORA; OTCQX: VFORF), a technology company that has built and operates a cloud-based digital platform for online enthusiast communities, today announced financial results for the second quarter ended June 30, 2025 ("Q2" or "the quarter").

鈥淚n Q2, our platform served 90 million MAUs and generated $14.5 million in revenue,鈥� said Chris Goodridge, CEO of VerticalScope. 鈥淭he real story this quarter is the speed at which we鈥檝e reshaped our teams and sharpened our focus to position the Company for long-term growth. Our profitable model and strong cash generation give us the firepower to invest decisively in high-impact initiatives, from expanding direct traffic to accelerating AI-powered innovation.鈥�

Mr. Goodridge added, 鈥淭he way people find and consume information is changing faster than ever, and that鈥檚 creating new opportunities for platforms like ours. VerticalScope鈥檚 communities deliver exceptional depth of expertise and engagement. As AI reshapes the digital landscape, we鈥檙e focused on scaling what makes us unique 鈥� building stronger relationships with our large base of direct users, broadening how we monetize our audiences, and deploying AI to enhance user experience. We have the assets, the talent, and the strategy to capture meaningful growth in the years ahead.鈥�

Financial Highlights for the Three Months Ended June 30, 2025

• Revenue decreased 13% to $14.5M, primarily due to a decline in MAUs, which impacted programmatic advertising. This follows a period of record-high MAU in the prior year.
• ARPU increased 17%, supported by a 41% year-over-year increase in e-commerce revenue.
• Adjusted EBITDA was $4.3M, down 39%, representing a 30% margin (compared to 42% in Q2 2024), reflecting lower revenue and increased investments in AI and traffic diversification.
• Operating Cash Flow increased 4% to $6.4M, inclusive of non-cash working capital changes from acquisitions.
• Free Cash Flow totaled $3.7M, reflecting 87% conversion of Adjusted EBITDA.
• Available Liquidity was $64.1M, comprised of $8.1M in unrestricted cash and $56.0M of undrawn revolver capacity.
• Net loss was $1.8M, compared to net income of $0.4M in the prior year, primarily due to lower revenue and $1.6M in one-time personnel and acquisition costs, partially offset by income tax recovery.

鈥淨2 demonstrated our ability to execute effectively while delivering a healthy Free Cash Flow conversion of 87% and a 30% Adjusted EBITDA margin,鈥� said Vince Bellissimo, CFO of VerticalScope. 鈥淪upported by a strong balance sheet and an efficient operating model, we continue to invest strategically in key initiatives that drive long-term value creation for our shareholders as we move into the second half of the year.鈥�

Earnings Conference Call and Webcast
Management will host a conference call and webcast to discuss the Company's financial results at 7 a.m. ET on Wednesday, August 13, 2025.

Live Call Registration and Webcast:

Joining Live by Telephone:
Canada: 1 833 950 0062
United States: 1 833 470 1428
Participant Access code: 628663

If you are unable to join live, an archived recording of the webcast will be available at: .

About VerticalScope Holdings Inc.

Founded in 1999 and headquartered in Toronto, Ontario, VerticalScope is a technology company that has built and operates a cloud-based digital platform for online enthusiast communities in high consumer spending categories. VerticalScope's mission is to enable people with common interests to connect, explore their passions, and share knowledge about the things they love. Through targeted acquisitions and development, VerticalScope has built a portfolio of over 1,200 online communities and approximately 100 million monthly active users.

Forward-Looking Statements

This news release contains forward-looking information within the meaning of applicable securities legislation that reflects the Company's current expectations regarding future events. When used in this news release, words such as 鈥渟hould鈥�, 鈥渃ould鈥�, 鈥渋ntended鈥�, 鈥渆xpect鈥�, 鈥減lan鈥� or 鈥渂elieve鈥� and similar expressions indicate forward-looking statements. Forward-looking information, including the Company鈥檚 plans for organic growth, deployment of capital, investments in our platform, the growth of revenue and MAU, information regarding our financial position, business strategy, growth strategies, addressable markets, budgets, operations, financial results, plans and objectives, is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond the Company's control. Although the Company believes that its expectations reflected in these forward-looking statements are reasonable, such statements involve risks and uncertainties and no assurances can be given that actual results will be consistent with these forward-looking statements. Such risks and uncertainties include, but are not limited to, the implementation and effectiveness of the Company's capital allocation strategy, the availability of high-quality M&A opportunities, dependence on search algorithms and third-party traffic sources, potential disruption from artificial intelligence technologies, and the factors discussed under "Risk Factors" in the Company鈥檚 Annual Information Form dated March 31, 2025, which is available on the Company鈥檚 profile on SEDAR Plus at . Actual results could differ materially from those projected herein. VerticalScope does not undertake any obligation to update such forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required under applicable securities laws.

Non-IFRS Measures

This press release references certain non-IFRS measures, including Adjusted EBITDA and Free Cash Flow, and Free Cash Flow Conversion as described below. This press release also makes reference to MAU, which is an operating metric used in our industry. These non-IFRS measures are not recognized measures under IFRS and do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of the Company鈥檚 results of operations from management鈥檚 perspective. Accordingly, these measures should not be considered in isolation nor as a substitute for analysis of the Company鈥檚 financial information reported under IFRS.

The Company uses non-IFRS measures including:

鈥淓BITDA鈥� is calculated as net income (loss) excluding interest, income tax expense (recovery), and depreciation and amortization.

鈥淎djusted EBITDA鈥� is calculated as EBITDA adjusted for share-based compensation, share performance related bonuses, unrealized gains or losses from changes in fair value of derivative financial instruments, severance, adjustments to contingent consideration liabilities measured at fair value through profit and loss, gain or loss on sale of assets, gain or loss on sale of investments, foreign exchange loss (gain), realized and unrealized other loss (gain) and other charges that include direct and incremental business acquisition related costs.

鈥淎djusted EBITDA Margin鈥� measures Adjusted EBITDA as a percentage of revenue.

鈥淔ree Cash Flow鈥� means Adjusted EBITDA less capital expenditures and income taxes paid during the period.

鈥淔ree Cash Flow Conversion鈥� is equal to Free Cash Flow for the period divided by Adjusted EBITDA for the period.

鈥淢onthly Active Users鈥� (鈥淢AU鈥�) is defined as the number of individuals who have visited our communities within a calendar month, based on data as measured by Google Analytics. To calculate average MAU in a given period, we sum the total MAU for each month in that period, divided by the number of months in that period.

SOURCE VerticalScope Holdings Inc.

Related Links

The following table sets forth a reconciliation of Adjusted EBITDA and Free Cash Flow to net income (loss):

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For further information

Investor and media inquiries:

VerticalScope 鈥� Vincenzo Bellissimo, Chief Financial Officer, Tel: 416-341-7166, [email protected]

FNK IR 鈥� Matt Chesler, CFA, Tel: 646-809-2183, [email protected]

Source: VerticalScope Holdings Inc.