ACCESS Newswire Inc. (ACCS) Q1 2026 Earnings Report, Transcript and Summary

Welcome to Access Newswire's First Quarter 26 Earnings Conference Call.

My name is Layla Calentery, and I am a product manager here at Access Newswire. I have been with the company since 2022, initially from the newswire.com business where I was a part of the PR optimizer team. Helping customers craft and amplify their stories. Now I am a part of the product team where I help ideate and shape some of the most exciting tools at the core of our industry's need. I also have been involved with our amazing EDU program, training professors, and bringing our product to over 100 universities and thousands of students. My time here at Access has flown by and I could not be more excited about what is in store for our customers our company, and myself as we all continue to get better every day. Before we begin, I would like to remind everyone that statements made in this conference call concerning future revenues, results from operations, financial position, markets, economic conditions, product releases, partnerships, and any other statements that may be construed as predictions of future performance or events are forward looking statements. These statements involve known and unknown risks and uncertainties that may cause actual results to differ materially from those expressed or implied by such statements. We will also discuss certain non GAAP financial measures, are provided for informational purposes and should be considered in addition to not as a substitute for GAAP results. With that, I will turn the call over to our founder and chief executive officer, Brian R. Balbirnie, and our chief financial officer, Steven Knerr. Brian?

Thank you, Layla, and good morning, everyone. And thank you for joining us to discuss Q1 26 results. It has been a pleasure to see you grow here at Access, Layla. I could not be more grateful for your customer first passion You are a big part of our product and CX teams. And I am sure I am speaking to the rest of the company when I say thank you so much. With that, let me be direct with you from the onset. Q1 revenues came in at 5.3 million down 472 thousand sequentially, from Q4 of last year, a 149 thousand year over year. That is not where we want to be. And I want to acknowledge that plainly. Top line growth is the mandate for 2026, and Q1 tells us we have to continue to push harder on new customer acquisition and volume. We are not satisfied with that number, and I will outline specifically what we are going to do about it. That said, there are several signals from Q1 that do give us a good amount of confidence in our business. First, our customer retention. This is a number I am generally proud of. We moved from retention rates in the high eighties in 2025 to 92% in 2026. This is a fundamental shift in the health of our subscription business. Retention at this level tells us that customers are finding value in our platform, and that our customer experience investments are working. That the product we launched are resonating with our customers. Churn was the story we talked about is risks in our Q4 call, and that is no longer the dominant story. The move to quarterly and annual billing, the rebuild of our customer success teams, are paying off. 92% retention is a result that we can build upon. Thank you both to our sales and CX teams for some great work since last year. Let's continue to learn, grow, and get better here. I am confident that we can reach our retention goals by year end. To be clear, that is greater than 95%. Second, ARR per subscriber. Has now increased for 7 of the last 8 quarters. This quarter, we continued that trend, reflecting the ongoing of our trade-up and trade-in activities, and early monetization of our new product tiers, Customers are now beginning to upgrade to our access PR that includes social monitoring, access verified, and soon this current quarter will be our new dynamic agent MCP analytics, that we have previously called “Kill the Report.”. Just in social monitoring alone, we have seen a 20% ARR lift in subscribing customers, We see that pattern continuing as we move all of our peer subscriptions to higher tiers to include these amazing new product advancements. I will talk more about that later after Steven's prepared remarks. Third, and before I hand it to Steven, I want to be transparent about the cost posture heading into the back half of the year. We are watching the macro environment carefully. There are headwinds in the broader industry, and we want to make sure that we are prepared. We are actively reviewing our SG&A structure to identify further efficiencies. Operating expenses in Q1 came in at $4.7 million, down $580 thousand or 11% from the prior quarter. And down $281 thousand or 6% year over year. This is meaningful progress. We intend to hold this discipline and find additional levers if the environment warrants We can manage costs without cutting into product innovation that is driving our platform differentiation and growth in our sales teams. The subscription story, however, continues to move in the right direction. Subscription revenues as a percentage of total revenue grew again this quarter, reaching approximately 60%. This shift is 1 of the most important structural changes happening in our business. It is happening because our platform is earning that recurring commitment from our customers. Steven, over to you, sir.

Thank you, Brian, and good morning, everyone. I will take you through the Q1 26 financial results in detail. Total revenue for the 2026 was $5.3 million a decrease of $472 thousand or 8% compared to Q4 25. A decrease of $149 thousand or 3% compared to Q1 25. We will address the revenue dynamic directly. Q1 carries inherent seasonality given the post-holiday timing, and press release volumes tend to be lower in Q1 relative to Q4. That said, we know we need to improve on the top line and are executing accordingly. Core press release revenue for Q1 26 was approximately $4.4 million down from $4.8 million in Q4 25. However, consistent with normal seasonal volume patterns, and consistent with Q1 25. As part of this, our PR platform and media suite revenue increased $200 thousand up 23% sequentially and year over year. That growth reflects the early monetization of our new subscription tiers and the strength of platform adoption. Revenue from our Pro plan was flat compared to Q4 25. However, decreased $126 thousand or 46% from Q1 25. Gross margin for Q1 26 was 74% compared to 77% in Q4 25, and 78% in Q1 25. The sequential decrease in gross margin percentage reflects the lower revenue base and a modest increase in cost of revenue due primarily to increased distribution costs. We believe gross margin will recover as volume and subscription revenue grow. The long term trajectory of this metric remains upward. The structural advantages of our fixed cost distribution and AI assisted editorial operations are intact. Moving to operating expenses. Total operating costs were $4.7 million in Q1 26, down $580 thousand or 11% from Q4 25 down $281 thousand or 6% year over year. This reflects disciplined cost management across the organization. General and administrative expenses were $1.8 million in Q1, down $181 thousand from Q4 25 down $172 thousand year over year. Product development expenses came in at $560 thousand. Down 60 thousand sequentially $173 thousand compared to the same quarter of the prior year. due to higher capitalized costs and lower contractor expenses. During Q1 26, we capitalized $99 thousand compared to $61 thousand during 2025 23 thousand dollars during 2025. Sales and marketing expenses were $1.68 million essentially flat sequentially and up modestly year over year as we invested in the pressrelease.com brand and continued trade show activity. Operating loss for Q1 26 was $718 thousand a slight improvement from Q4 25, and a shade lower than Q1 25. On a GAAP basis, net loss from continuing operations was $611 thousand in Q1 26. Compared to $509 thousand in Q4 25 and $765 thousand in 2025. The improvement reflects both cost discipline and reduced interest expense relative to the prior year. On a non GAAP basis, EBITDA for 2020 and 2025 was relatively flat. Compared to $251 thousand or 4% of revenue in 2025. Adjusted EBITDA for 2026 and 2025 was $564 thousand or 11%, 10% of revenue, respectively. Compared to $881 thousand or 15% of revenue in 2025. The sequential decline in adjusted EBITDA is primarily a function of lower revenue in the quarter. We ended the quarter with a solid cash position and continue to generate adjusted free cash flow. Cash flow from operations increased to $871 thousand for Q1 25. Compared to $258 thousand in 2025 and $747 thousand in 2025. Our deferred revenue balance remains healthy, reflecting the forward committed nature of our subscription business. Looking at our SG&A posture, as Brian mentioned, we are actively evaluating further efficiencies. We have demonstrated the ability to reduce costs without compromising the product road map. With potential industry headwinds on the horizon, want to be positioned to act quickly if needed. The operational discipline we have built over the past 18 months gives us the flexibility to do that. I will now turn it back over to Brian.

Steven Knerr. Let me take a few minutes to give you the operating picture of what we are focused on for the rest of the year. As I said earlier, revenue growth is the priority, and I want to be specific about the levers that we are pulling. First, the new products which we bought to market at the '4 and into Q1 is now in full commercialization mode. Social monitoring has been enabled as both a subscription upgrade and as part of our new access PR subscription plans. This is generating incremental ARR. The $200 per month lift per upgrading subscriber that we discussed last quarter is real. As of Q2, it has begun, and we are seeing that 20% ARR lift as I mentioned earlier in the opening remarks. The benefit across initially introduced 60% opted to take advantage of this benefit. Generating an implied $550 thousand in ARR that we expect to see over the next 12 months. Second, access verified. Our AI powered editorial assistant is now customer facing and receiving strong early feedback. Emily customers have reported meaningful time savings and improved confidence in their content's prior to distribution. This is not just a feature. It is a competitive differentiator that no other wire service can match in this depth. We have several upgrades, iterations of this product scheduled for the year, and we expect to be in a meaningful add on driver to our plans. We envision both this and the next topic here coming up coming together closely as a single offering over the next 12 months. That is our dynamic model context protocol, which we say MCP for short is an industry term. It is our in-depth analytics report that I have coined for the last 2 quarters that “Kill the Report”. Our very own AI assisted content performance and analytics engine which is live for customers right now. We made good on this commitment. The feedback from our initial customers over the last couple weeks who were granted an MVP at no cost to take a peek and experience the difference between our transparent real time intelligence reporting and the legacy opaque distribution reports has been exactly what we expected. This is a market differentiating product, and we expect it to drive both retention and upsell. There will be incremental revenue from this product, for our entire customer base where customers can elect to buy up to have this analytics engine on a per release basis or a subscription basis. We are confident, like our social monitoring solution this new AI assistant content performance and analytics engine, will deliver immediate revenue here in Q2 and help drive both ARR to our guided goals as well as provide our customers something that they just cannot replace anywhere else. Explained this to our customers the other day. it is the report that you thought you should have gotten for decades in this business and we are the first to bring it to you. Also, as we grow our customer base, we want to be thought about tools and technologies we might never build that we feel partners can do a better job for our customers. This is really an expansion of the trusted relationships we have had on the public side for over a decade. Exchanges like the New York Stock Exchange, OTC Markets, and London Stock Exchange have been a part of our platform. Now we are just going after brands that have additional trusted platforms in both public and private companies. This marketplace that we talked about last quarter is fully operational and Hootsuite is leading the way as our first integration partner and additional partnerships coming in the pipeline. The ability to schedule, publish, and analyze social content within the same platform used to distribute press releases is something our enterprise customers have been asking for. We expect this integration to contribute to new enterprise acquisitions in the second half of the year. We are also continuing to work with Hootsuite on cross selling opportunities to better arm each other's customers with the best of breed products. Moving along to subscribers. We continue to focus on quality of subscriptions over raw count. but we did sell more this quarter coming in at 110 new customers in Q1, and we saw the retention improvement I highlighted earlier. Our pipeline for our Access EDU program is beginning to convert with schools, and their associated PR agencies entering paid subscriptions. EDU investment is long-term growth channels for us, and we are beginning to see early revenue signals. In Q1, ARR increased 15% year over year from $11 thousand to $12 thousand. We also ended the quarter up in total subscriptions ending the period at 1.12 thousand subscribers, up 17% from 955. Sequentially, ARR increased 2%, and our subscribers increased 10%. The combination of these results have helped us manage our customer acquisition costs and improve them over last year, something we continue to believe we can improve as our brands gain more traction in the markets. Our subscription business retention rate continues to improve in the numbers of new customers coming in and continues to grow. Obviously translating into higher EBITDA margins, sustained growth, and improved gross margins. The latter, we need to improve, but volumes are key to the majority of our PR business as a fixed cost. We do track our customer acquisition cost by subscriber and non-subscriber. For the quarter ended March, customer acquisition cost per subscriber was $5.29 thousand. And a nonsubscriber was $2.28 thousand. Are seeing much lower customer acquisition costs in our pressrelease.com business, but it is too new for us to have a baseline yet to discuss. We plan to do that by year's end. Remaining part of 2026 and into 2027, we have a significant amount of new innovation advancements coming to our subscription business. 1 most notably is a full amplification of a story and how and where it can be told at the right time to the right audiences. Have already tested a good bit of this on our model context protocol platform, and have gained significant excitement from industry experts. We are committed to what we have started this year, and that is to out-innovate our peers, deliver value to our customers beyond the press release, and continually innovate where our customers ask. In closing, yes, revenues were down slightly year over year, And, yes, we experienced some macro industry volume fluctuations, but our customer accounts continue to deliver. Our ARR increased, and the number of subscribers grew. And our technology is being delivered at a higher rate than ever before. Lastly, for the quarter, we continue to repurchase our common shares, and have a little more than half of our repurchase plan left and we look forward to completing the plan and instituting further repurchases this year. We are focused, and our teams continue to work hard to improve our customer acquisition costs, retention, and overall new customer activity as well as expand our core product features. And in combination, we believe this will allow us to continue to generate cash flows from operations, increase our EBITDA margins and increase our overall market share.

I am happy now to turn the call over to the operator for questions. Thank you. At this time, we will be conducting a question and answer session You may press 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset. 1 moment please while we poll for questions. And the first question today is coming from Luke Horton from Northland Securities. Lou, your line is live.

Hey, guys. Thanks for taking the questions. Brian, just wanted to start-- start off with the product development front. I guess, what are you most excited about here in 2026 with the product suite, whether that be the access verified, the MCP, analytics reporting, and social monitoring, I guess, how would you rank excitement level amongst product development?

Yeah. that is that is a good question. Okay. it is a tough 1 to answer, right, to be fair. I would have to say from all of us shareholders, I would say social monitoring because it is already proven that we have gotten conversion to the trade up. To get customers to increase the spend and get value from that platform. So to be fair, I think for all of us as shareholders, that is a very important metric. it is good to build products. it is great to put them to market fast and iterate them. But it is really rewarding for us to see that actually gain traction from a revenue contribution perspective that we will see. The other products, something I am not excited about, though, ACCESS Verified is a good, intelligence tool to help our customers and our editors. Create content and validate content quicker. You know, that is a just a really good differentiator to the market. The reporting product “Kill the Report.”. I mean, look. We need to “Kill the Report.”. This industry is old. This industry is antiquated. This industry needs to change. And we have tried desperately to be the new incumbent to follow and be like them. And to be fair, with them. Do not wanna be like them anymore. So we expect that “Kill the Report” to also be as impactful as social monitoring as well this year. So I am very excited about that. And not to elongate the response, Luke, but I am really super excited about where we are headed and what our product development and operations teams are already building. For the latter part of this year. And that really is taking every 1 of the ecosystems that we interact with every day, as well as our partners, and folks down the hall. And our shareholders know that we are very focused on investor relations and public relations. But the corp comm, the CMO's office, has a significant amount more budget. Not only budget for PR in general but a budget for marketing communication tools. And so do not want to be the answer for everything. We are never gonna replace their HubSpot or Hootsuite or anything like that. But there is an ecosystem of content curation and amplification that we have built that we are excited about taking that product to market. And that will really strengthen our ability to go upstream and go linear in all industries. So that we can bring customers into our platform at a much higher rate which would reduce our cost to acquire a customer and elongate that profitability long term. So it is tough I think I led in as best order as I could, Luke.

Okay. No. Yeah. Great. I appreciate that. And then I guess, from a sales effort, how do you guys balance mean, you added 180 new subscribers during the quarter. But also, I mean, the social monitoring platform you had 20% lift in ARR. I guess, how do you balance trying to acquire net new customers versus cross sell or upsell opportunities?

Yeah. Yeah. it is, these guys and gals work hard. Right? We, you know, we may have what appears to be, a high SG&A more sales and marketing expense. But, really, to answer your question, a salesperson or territory manager is to get to every customer he is got along with marketing efforts to increase their spend and increase subscriptions and show them value in new product, they are also in charge of going and getting new customers. They have got to be at events. Right? We are doing a lot more events today than we ever have before. that is paying off in our pipeline, and we need to continue to do that. And so to really figure it out, when you look and analyze the numbers, there is just not enough touches. We need more people. And so we hired more people in the prior quarter here, to be able to help drive some outbound activity, I think I have said this for years, what matters most is customers. Right? The more customers, everything takes care of itself. Volumes start to come at a higher rate. It allows us to allow our really good sales and development people to build relationships, to increase ARRs, and or just utilization in general. So, it does not come without expense. They do wear a lot of hats. And the priority last quarter was for them to sell good quality subscription customers. And get to customers about our new ARR add ons. And they did that well. We just need to do everything else too.

Yep. No. It makes sense. And then lastly, just average ARR per subscription that continues to grow. I think you said 7 out of the last 8 quarters. Could you elaborate on how much of this is coming from price increases versus kind of upgrading to higher product tiers across the platform?

Yeah. So in Q1, there was no pricing increases to our customers that were already subscribers. So, you know, to your point that generally folks in our industry have price increasing all the time, You know, we did not increase subscription customer contracts. New subscription customers were at a higher add on. Right? We did increase price and take price in some of those areas, but we did not increase current subscribers. And now Q2, it is it is also done the same because of the social monitoring add ons as well. We want value out of our platform for our customer. And we want that value proven. it is to be fair easier to take price and increase ARR with them. They have got value early on. And so it is very important to take our current subscribers and not push them too much on price at this point. We are proving value to those folks. And so new deals were higher. As we have indicated, we are gonna continue to message that, that we believe that long term ARR will continue to grow. We are doing a really good job of that. Here in Q2 as well. We do not see that changing in the in the foreseeable future. Okay. Got it. Thanks for that, Brian. And thanks for taking the questions. You are welcome. Thank you, Luke.

Thank you. And once again, it is next question is coming from Jacob Stephan from Luke Street Capital Markets. Jacob, your line is live.

Hey, guys. Appreciate you taking the questions. Hey, guys. I guess, first, I just wanted to touch on the revenue, you know, decline. I guess when we look at kind of pro plan products, customer attrition there, webcasting events, just seasonal weakness. I guess, when in the quarter does it kind of start to shift the other direction?

Yeah. it is interesting. You know? And it is devils are in the details. Right? And it is tough in an earnings call situation to pull everything out. And allow folks to digest it as fast as we were talking through some of the data. So when we look at our pro plan customers, to be fair, as we have seen revenues change dramatically over the last kind of year and a half there, we are not losing the customer. A good percentage of them are buying the Access PR subscription. So we are moving them to a more self-service model than a fully managed model. And so as that continues to happen, we are gonna see that contribution from that product perhaps continue to decline where it all becomes then our access PR or access IR subscribing products. And so I do not expect that part to change. What we do see in seasonality is there is companies on the public side ramp up through into Q2, and you guys know this. We all know this. The amount of events and conferences and activity going on between, Q1 and then annual meeting time, things that happen, the activity tends to kick up pretty quickly here. And so you know, that is back to the utilization business, right, which is about 40% of our business today. Is driven from some of that activity as we continue to increase percentage of revenue from subscriptions, that seasonality conversation goes away even more. And we had it a lot in years past with our compliance business. It is become minimalized, and it will become de minimis here very shortly. And to be fair, we look forward to those days. Right? We wanna guide this business that by this time next year, that we are close to 80% of everything is ARR. We do not have that seasonality shift. And customers can buy up into plans that fit their volume needs, and we do not have to worry about that shift there. Hope that answers your question.

Got it. Understood. Maybe just next 1 for me. You guys had an interesting kind of number in your deck here, 550 thousand implied ARR. I guess, is that for the entire solution with social monitoring, or can you kinda unpack that for me?

Yeah. No. that is a great question. And that is just the revenue dollar value attributable to the social monitoring add on. It does not impact or affect what they had already spent and or spending with us in the future. So if a customer is spending thousand dollars a year for their Axis PR subscription, and they opted to say, That 1's social monitoring. Their annual increase went up $2.4 thousand. So it is it is additive to the top of it. So that $5.50 is the aggregate number. it is actually $5.56 is the aggregate revenue over the next 12 months that we will we will earn from those customers that bought the upgrade, but those customers still are paying for the other part of the subscription. So it is just a component. If that makes sense.

Okay. Yeah. No. That help that is helpful. And last 1 for me. Wondering if you could give an update on the press release of the volume you know, competition. Where do you guys stand today?

Yeah. We, you know, we saw Steven and I both talked about, so now had been a little bit. We are seeing volume across the market come down. Right? There is a little bit of decrease in total volume. So we are kind of neck and neck literally, like, a tenth of a percent with Business Wire and us in the third position. Globe and Care Newswire still are the top 1 and 2 in that space. You know, for us, as much as it is been a metric for us to look at volume, we now have to look at volume internally by what we look at as our core customers and our subscribing customers that are core to us as well. So we wanna manage what volumes come from subscriptions and which ones come from a PayGo or inbound e-comm ways. So I think all given equal, we have not really lost much traction. it is just we have all come down just a little bit in volume in the industry. And I expect that to kick back up here for the remaining part of the year. If I go back 3 or 4 years, I have seen the same kind of things happen where volume will drop a little bit across the board. But by no way is there significant volume drops for us or anybody else in the industry. So I think industry may be at a at a at a no growth mode right now, but that you know, for us, to be fair, we are in the subscription communications business now more than we are just selling a press release business. And so I am not as worried about that, if that happens more often than not.

Okay. Got it. I appreciate all the color. Thank you.

Thank you. And that does conclude today's Q&A session.

I will now turn the call over to Brian R. Balbirnie for closing remarks. Thank you to everybody joining us today, both on the webcast and the teleconference Appreciate the questions and follow ups. I know there is going to be more as you digest the data. The 10-Q will be filed here this afternoon after market close. And I will be spending the rest of my day at the Sidoti conference. So if any of you here in New York wanna stop by, have a chat, I have got a couple of minutes between my 1 on ones. I am happy and would love to meet you face to face and do that. I wish you a good earning season, and I will talk to you next quarter. Thank you.

Thank you. This does conclude today's conference. You may disconnect your lines at this time. Thank you for your participation.