Digital Turbine Reports Fiscal 2026 Second Quarter Financial Results
Second Quarter Revenue Totaled $140.4 Million, Representing Year-over-Year Growth of 18%
Second Quarter GAAP Net Loss of $21.4 Million and GAAP EPS of ($0.20); Second Quarter Non-GAAP Adjusted Net Income 1 of $16.5 Million and Non-GAAP Adjusted EPS 1 of $0.15
Second Quarter Non-GAAP Adjusted EBITDA 2 Totaled $27.2 Million, Representing Year-over-Year Growth of 78%
AUSTIN, Texas, Nov. 4, 2025 /PRNewswire/ -- Digital Turbine, Inc. (Nasdaq: APPS) announced financial results for the fiscal second quarter ended September 30, 2025.
Recent Financial Highlights:
"Our September quarter showcased accelerating business momentum," said Bill Stone, CEO. "We were pleased to see that the combination of strong demand for our platform and strong operational execution enabled us to deliver top- and bottom-line results that exceeded expectations. Consequently, we are once again able to increase our full-year outlook. We have high conviction that we have the right strategy to go after the half-trillion dollar market opportunity in front of us."
Fiscal 2026 Second Quarter Financial Results
Total revenue for the second quarter of fiscal 2026 was $140.4 million, representing year-over-year growth of 18% as compared to revenue of $118.7 million for the second quarter of fiscal 2025. Total On Device Solutions revenue before intercompany eliminations was $96.5 million. Total App Growth Platform revenue before intercompany eliminations was $44.7 million.
GAAP net loss for the second quarter of fiscal 2026 was $21.4 million, or ($0.20) per share, as compared to GAAP net loss for the second quarter of fiscal 2025 of $25.0 million, or ($0.24) per share.
Non-GAAP adjusted net income 1 for the second quarter of fiscal 2026 was $16.5 million, or $0.15 per share, as compared to Non-GAAP adjusted net income 1 of $5.5 million, or $0.05 per share, in the second quarter of fiscal 2025.
Non-GAAP adjusted EBITDA 2 for the second quarter of fiscal 2026 was $27.2 million, representing year-over-year growth of 78% as compared to Non-GAAP adjusted EBITDA 2 for the second quarter of fiscal 2025 of $15.3 million.
Business Outlook
Based on information available as of November 4, 2025, the Company is raising its expectations for fiscal year 2026 to the following:
It is not reasonably practicable to provide a business outlook for GAAP net income because the Company cannot reasonably estimate the changes in stock-based compensation expense, which is directly impacted by changes in the Company's stock price, or other items that are difficult to predict with precision.
About Digital Turbine, Inc.
Digital Turbine empowers superior mobile consumer experiences and results for the world's leading telcos, advertisers, and publishers. Its end-to-end platform uniquely simplifies its partners' abilities to supercharge awareness, acquisition, and monetization – connecting them with more consumers, in more ways, across more devices. Digital Turbine is headquartered in North America, with offices around the world. For additional information visit www.digitalturbine.com.
Conference Call
Management will host a conference call and webcast today at 4:30p.m. ET to discuss its fiscal 2026 second quarter financial results and provide operational updates on the business. The conference call will discuss forward guidance and other material information. The call can be accessed online via the webcast link: https://app.webinar.net/rENw78MPZJe. The call can also be accessed by dialing 888-317-6003 in the United States (or 412-317-6061 from international locations) and entering access code 5008199. A live and archived webcast of the call can be accessed via the Investor Relations section of Digital Turbine's website. The webcast will be archived for a period of one year and is available via the Investor Relations section of Digital Turbine's website.
For those unable to join the live call, a playback will be available through November 11th, 2025. The replay can be accessed by dialing 877-344-7529 in the United States or 412-317-0088 from international locations, passcode 5645638.
An online webcast will be archived for a period of one year and is available via the Investor Relations section of Digital Turbine's website.
Use of Non-GAAP Financial Measures
To supplement the Company's consolidated financial statements presented in accordance with GAAP, Digital Turbine uses non-GAAP measures of certain components of financial performance. These non-GAAP measures include non-GAAP adjusted net income and earnings per share ("EPS"), non-GAAP adjusted EBITDA, non-GAAP free cash flow and non-GAAP gross profit. Reconciliations to the nearest GAAP measures of all non-GAAP measures included in this press release can be found in the tables below.
Non-GAAP measures are provided to enhance investors' overall understanding of the Company's current financial performance, prospects for the future and as a means to evaluate period-to-period comparisons. The Company believes that these non-GAAP measures provide meaningful supplemental information regarding financial performance by excluding certain expenses and benefits that may not be indicative of recurring core business operating results. The Company believes the non-GAAP measures that exclude such items when viewed in conjunction with GAAP results and the accompanying reconciliations enhance the comparability of results against prior periods and allow for greater transparency of financial results. The Company believes non-GAAP measures facilitate management's internal comparison of its financial performance to that of prior periods as well as trend analysis for budgeting and planning purposes. The presentation of non-GAAP measures is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.
1Non-GAAP adjusted net income and EPS are defined as GAAP net income and EPS adjusted to exclude the effect of the following, if any: stock-based compensation expense, amortization of intangibles, business transformation costs, transaction-related expenses, severance costs, changes in fair value of contingent consideration, contract settlement fees, impairment of goodwill, tax adjustments, (gain)/loss on extinguishment of debt, amortization of debt discount, issuance costs, and unrealized (gain)/loss on derivatives. The Company added (gain)/loss on extinguishment, the amortization of debt discount and issuance costs, and unrealized (gain)/loss on derivatives due to their unusual nature and association with the Company's specific September 2, 2025 debt refinance transaction and related issuance of warrants. Readers are cautioned that non-GAAP adjusted net income and EPS should not be construed as an alternative to comparable GAAP net income figures determined in accordance with U.S. GAAP as an indicator of profitability or performance, which is the most comparable measure under GAAP.
2Non-GAAP adjusted EBITDA is calculated as GAAP net income excluding the following cash and non-cash expenses, if any: stock-based compensation expense, depreciation and amortization, net interest income (expense), net other income (expense), business transformation costs, foreign exchange transaction gains (losses), income tax (benefit) provision, transaction-related expenses, contract settlement fees, changes in fair value of contingent consideration, impairment of goodwill, severance costs, (gain)/loss on extinguishment of debt, amortization of debt discount and issuance costs, and unrealized (gain)/loss on derivatives. The Company added (gain)/loss on extinguishment, the amortization of debt discount, issuance costs, and unrealized (gain)/loss on derivatives due to their unusual nature and association with the Company's specific September 2, 2025 debt refinance transaction and related issuance of warrants. Non-GAAP adjusted EBITDA margin is calculated as non-GAAP adjusted EBITDA as a percentage of total revenue. Readers are cautioned that non-GAAP adjusted EBITDA should not be construed as an alternative to net income determined in accordance with U.S. GAAP as an indicator of performance, which is the most comparable measure under GAAP.
3Non-GAAP free cash flow, which is a non-GAAP financial measure, is defined as net cash provided by operating activities (as stated in our Consolidated Statements of Cash Flows), excluding the following, if any: transaction-related expenses, severance costs and business transformation costs, reduced by capital expenditures. Readers are cautioned that free cash flow should not be construed as an alternative to net cash provided by operating activities determined in accordance with U.S. GAAP as an indicator of profitability, performance or liquidity, which is the most comparable measure under GAAP.
4Non-GAAP gross profit is defined as GAAP income from operations adjusted to exclude the effect of the following, if any: product development costs, sales and marketing costs, general and administrative costs, contract settlement fees, impairment of goodwill and depreciation of software included in other direct costs of revenue. Readers are cautioned that non-GAAP gross profit should not be construed as an alternative to income from operations determined in accordance with U.S. GAAP as an indicator of profitability or performance, which is the most comparable measure under GAAP.
Non-GAAP adjusted EBITDA, non-GAAP adjusted net income and EPS, non-GAAP free cash flow and non-GAAP gross profit are used by management as internal measures of profitability and performance. They have been included because the Company believes that the measures are used by certain investors to assess the Company's financial performance before non-cash charges and certain costs that the Company does not believe are reflective of its underlying business.
Forward-Looking Statements
This news release includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements in this news release that are not statements of historical fact and that concern future results from operations, financial position, economic conditions, product releases and any other statement that may be construed as a prediction of future performance or events, including financial projections and growth in various products are forward-looking statements that speak only as of the date made and which involve known and unknown risks, uncertainties and other factors which may, should one or more of these risks uncertainties or other factors materialize, cause actual results to differ materially from those expressed or implied by such statements. These factors and risks include:
Risks Specific to our Business
Risks Related to the Mobile Advertising Industry
Industry Regulatory Risks
Risks Related to Our Intellectual Property and Potential Liability
Risks Relating to Our Common Stock and Capital Structure
You should not place undue reliance on these forward-looking statements. The Company does not undertake to update forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
Investor Relations Contact:
Brian Bartholomew
Digital Turbine, Inc.
brian.bartholomew@digitalturbine.com
Digital Turbine, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income
(Unaudited)
(in thousands, except share and per share amounts)
Three months ended
September 30,
Six months ended
September 30,
2025
2024
2025
2024
Net revenue
$ 140,377
$ 118,728
$ 271,303
$ 236,717
Costs of revenue and operating expenses
Revenue share
63,093
56,336
121,231
112,145
Other direct costs of revenue
11,242
8,438
22,046
16,228
Product development
10,979
9,433
21,126
20,147
Sales and marketing
14,446
15,887
28,035
32,134
General and administrative
34,083
42,176
76,992
85,693
Total costs of revenue and operating expenses
133,843
132,270
269,430
266,347
Income (loss) from operations
6,534
(13,542)
1,873
(29,630)
Interest and other income (expense), net
Change in fair value of contingent consideration
—
200
—
200
Interest expense, net
(11,498)
(8,776)
(20,298)
(16,725)
Amortization of debt discount and issuance costs
(2,778)
(456)
(3,932)
(757)
Unrealized loss on derivatives
(2,335)
—
(2,335)
—
Foreign exchange transaction gain (loss)
1,136
(976)
222
(158)
Loss on extinguishment of debt
(9,795)
—
(9,795)
—
Other expense, net
(1,207)
(36)
(1,875)
78
Total interest and other expense, net
(26,477)
(10,044)
(38,013)
(17,362)
Loss before income taxes
(19,943)
(23,586)
(36,140)
(46,992)
Income tax provision (benefit)
1,452
1,400
(641)
3,150
Net loss
(21,395)
(24,986)
(35,499)
(50,142)
Other comprehensive income (loss)
Foreign currency translation gain (loss)
(2,204)
2,157
1,996
944
Comprehensive loss
(23,599)
(22,829)
(33,503)
(49,198)
Net loss per common share
Basic
$ (0.20)
$ (0.24)
$ (0.33)
$ (0.49)
Diluted
$ (0.20)
$ (0.24)
$ (0.33)
$ (0.49)
Weighted-average common shares outstanding
Basic
109,128
103,041
107,885
102,722
Diluted
109,128
103,041
107,885
102,722
Digital Turbine, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(in thousands, except par value and share amounts)
September 30, 2025
March 31, 2025
(Unaudited)
ASSETS
Current assets
Cash, cash equivalents, and restricted cash
$ 39,284
$ 40,084
Accounts receivable, net
205,904
181,770
Prepaid expenses
6,118
6,923
Value-added tax receivable
9,695
8,291
Other current assets
7,978
5,711
Total current assets
268,979
242,779
Property and equipment, net
48,463
46,966
Right-of-use assets
8,455
9,924
Intangible assets, net
235,836
257,697
Goodwill
223,788
221,741
Other non-current assets
33,144
33,747
TOTAL ASSETS
$ 818,665
$ 812,854
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable
$ 112,073
$ 139,944
Accrued revenue share
80,447
35,264
Accrued compensation
13,125
7,503
Acquisition purchase price liabilities
854
1,697
Short-term debt, net of debt discount and issuance costs
2,688
—
Other current liabilities
35,319
38,118
Total current liabilities
244,506
222,526
Long-term debt, net of debt discount and issuance costs
393,753
408,687
Derivative liabilities
6,002
—
Deferred tax liabilities, net
16,631
16,308
Other non-current liabilities
9,647
11,375
Total liabilities
670,539
658,896
Commitments and contingencies
Stockholders' equity
Preferred stock
Series A convertible preferred stock at $0.0001 par value; 2,000,000 shares
authorized, 100,000 issued and outstanding (liquidation preference of $1)
100
100
Common stock
$0.0001 par value: 200,000,000 shares authorized; 112,509,828 issued and
111,751,703 outstanding at September 30, 2025; 106,735,767 issued and
105,977,642 outstanding at March 31, 2025
10
10
Additional paid-in capital
920,336
892,665
Treasury stock (758,125 shares at September 30, 2025 and March 31, 2025)
(71)
(71)
Accumulated other comprehensive loss
(49,308)
(51,304)
Accumulated deficit
(722,941)
(687,442)
Total stockholders' equity
148,126
153,958
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
$ 818,665
$ 812,854
Digital Turbine, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(in thousands)
Three months ended September 30,
2025
2024
Cash flows from operating activities:
Net loss
$ (21,395)
$ (24,986)
Adjustments to reconcile loss income to net cash provided by operating activities:
Depreciation and amortization
14,866
19,352
Amortization of debt discount and issuance costs
2,778
456
Allowance for credit losses
54
1,084
Unrealized loss on derivatives
2,335
—
Stock-based compensation expense
5,451
8,999
Loss on extinguishment of debt
9,795
—
Change in estimate of remaining contingent consideration
—
(200)
Noncash lease expense
957
838
Foreign exchange transaction loss (gain)
(1,136)
976
(Increase) decrease in assets:
Accounts receivable, gross
(2,284)
3,183
Prepaid expenses
298
(161)
Value-added tax receivable
(475)
(497)
Other current assets
(1,422)
46
Right-of-use asset
203
(3,142)
Other non-current assets
384
(96)
Increase (decrease) in liabilities:
Accounts payable
(1,269)
(20,435)
Accrued revenue share
552
3,025
Accrued compensation
3,345
434
Other current liabilities
2,936
2,079
Deferred income taxes
(756)
(1,035)
Other non-current liabilities
(757)
1,361
Net cash provided by (used in) operating activities
14,460
(8,719)
Cash flows from investing activities
Capital expenditures
(7,770)
(7,477)
Net cash used in investing activities
(7,770)
(7,477)
Cash flows from financing activities
Proceeds from borrowings, net of original issue discount
418,700
21,000
Payment of debt issuance costs
(10,617)
(1,561)
Payment of deferred business acquisition consideration
(308)
—
Repayment of debt obligations
(421,052)
(6,000)
Proceeds from issuance of common stock in connection with at-the-market offering,
net of issuance costs of $420
13,573
Payment of withholding taxes for net share settlement of equity awards
(157)
(112)
Options exercised
85
79
Net cash provided by financing activities
224
13,406
Effect of exchange rate changes on cash and cash equivalents and restricted cash
(1,762)
(174)
Net change in cash and cash equivalents and restricted cash
5,152
(2,964)
Cash and cash equivalents and restricted cash, beginning of period
34,132
35,729
Cash and cash equivalents and restricted cash, end of period
$ 39,284
$ 32,765
REVENUE BY SEGMENT
(in thousands)
(Unaudited)
Three months ended September 30,
2025
2024
% Change
On Device Solutions
$ 96,464
$ 82,414
17 %
App Growth Platform
44,685
37,346
20 %
Elimination
(772)
(1,032)
(25) %
Consolidated
$ 140,377
$ 118,728
18 %
GAAP (LOSS) INCOME FROM OPERATIONS TO NON-GAAP GROSS PROFIT
(in thousands)
(Unaudited)
Three months ended September 30,
2025
2024
Net revenue
$ 140,377
$ 118,728
(Loss) income from operations
6,534
(13,542)
Add-back items:
Product development
10,979
9,433
Sales and marketing
14,446
15,887
General and administrative
34,083
42,176
Depreciation of software included in other direct costs of revenue
—
51
Non-GAAP gross profit
$ 66,042
$ 54,005
Non-GAAP gross profit percentage
47 %
45 %
GAAP NET LOSS TO NON-GAAP ADJUSTED NET INCOME
(in thousands)
(Unaudited)
Three months ended September 30,
2025
2024
Net loss
$ (21,395)
(24,986)
Add-back items:
Stock-based compensation expense
5,451
8,999
Amortization of intangibles
10,410
13,505
Change in fair value of contingent consideration
—
(200)
Tax adjustment (1)
6,802
7,200
Business transformation costs
—
237
Severance costs
341
268
Amortization of debt discount and issuance costs
2,778
456
Loss on extinguishment of debt
9,795
—
Unrealized loss on derivatives
2,335
—
Non-GAAP adjusted net income
$ 16,517
$ 5,479
Non-GAAP adjusted net income per common share
$ 0.15
$ 0.05
Weighted-average common shares outstanding, diluted
113,009
105,345
(1) Valuation allowance
GAAP NET LOSS TO NON-GAAP ADJUSTED EBITDA
(in thousands)
(Unaudited)
Three months ended September 30,
2025
2024
Net loss
$ (21,395)
$ (24,986)
Add-back items:
Stock-based compensation expense
5,451
8,999
Depreciation and amortization
14,866
19,352
Interest expense, net
11,498
8,776
Amortization of debt discount and issuance costs
2,778
456
Other expense, net
1,207
36
Change in fair value of contingent consideration
—
(200)
Business transformation costs
—
237
Loss on extinguishment of debt
9,795
—
Foreign exchange transaction (gain) loss
(1,136)
976
Income tax provision (benefit)
1,452
1,400
Severance costs
341
268
Unrealized loss on derivatives
2,335
—
Non-GAAP adjusted EBITDA
$ 27,192
$ 15,314
GAAP CASH FLOW FROM OPERATING ACTIVITIES TO NON-GAAP FREE CASH FLOW
(in thousands)
(Unaudited)
Three months ended September 30,
2025
2024
Net cash provided by (used in) operating activities
$ 14,460
$ (8,719)
Capital expenditures
(7,770)
(7,477)
Severance costs
341
268
Business transformation costs
—
237
Non-GAAP free cash flow provided by (used in) operations
$ 7,031
$ (15,691)
SOURCE Digital Turbine, Inc.