Cineverse Q4 FY2026 Earnings Call - Acquisitions Drive Revenue Surge and Strategic Pivot to Ad-Tech

Operator, Conference Call Operator: Everyone. Thank you for joining us, Welcome to Cineverse fourth quarter and fiscal year 2026 earnings conference call. After today’s prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. I will now hand the conference over to Gary Loffredo, Chief Legal Officer, Secretary, and Senior Advisor. Gary, please go ahead.

Gary Loffredo, Chief Legal Officer, Secretary, and Senior Advisor, Cineverse: Good morning, everyone. Thank you for joining us for the Cineverse fourth quarter and fiscal year 2026 financial results conference call. The press release announcing Cineverse’s results for the fiscal fourth quarter ended March 31st, 2026, is available at the investors section of the company’s website at www.cineverse.com. A replay of this broadcast will also be made available on Cineverse’s website after the conclusion of this call. Before we begin, I would like to point out that certain statements made on today’s call contain forward-looking statements. These statements are based on management’s current expectations and are subject to risks, uncertainties, and assumptions. The company’s periodic reports that are filed with the SEC describe potential risks and uncertainties that could cause the company’s business and financial results to differ materially from these forward-looking statements.

All the information discussed on this call is as of today, June 26th, 2026, Cineverse does not assume any obligation to update any of these forward-looking statements, except as required by law. In addition, certain financial information presented in this call represent non-GAAP financial measures, We encourage you to read our disclosures and the reconciliation tables to applicable GAAP measures in our earnings release carefully as you consider these metrics. I’m Gary Loffredo, Chief Legal Officer, Secretary, and Senior Advisor at Cineverse. With me today are Chris McGurk, Chairman and CEO. Eric Opeka, President and Chief Strategy Officer. Tony Huidor, President of Technology and Chief Product Officer. Sean McCabe, Chief Financial Officer. Yolanda Macias, Chief Motion Pictures Officer, Mark Torres, Chief People Officer. All of whom will be available for questions following the prepared remarks.

On today’s call, Chris will briefly discuss our fourth quarter and fiscal year 2026 business highlights. Sean will follow with a review of our financial results, Eric will provide further details on our two recent acquisitions. I will now turn the call over to Chris McGurk to begin.

Chris McGurk, Chairman and CEO, Cineverse: Thank you, Gary, and thanks everyone for joining us on the call today. First, I want to note that we’re very happy to have our new CFO, Sean McCabe, here with us on the call today. Sean was our controller previously and returns to the company as CFO, having acquired some valuable experience in the ad tech business, which as you’ll hear today, is going to be a big part of our future following our acquisition of IndiCue and all the related synergies that that’s going to create with the rest of our business. Let me first review our operating highlights for this quarter, then Sean will get into more detail about our financial results and guidance.

Eric will then explain our post-acquisition strategy going forward as a scaled, AI-powered, fully integrated technology and service provider to the entertainment industry with assets and a synergy flywheel that we believe none of our competitors can match. After that, we’ll take your questions. We had a very strong fiscal fourth quarter. We generated $26 million in consolidated revenues, up 67% over the prior year period. This reflected solid performance in our base business, plus a partial quarter contribution from our two new acquisitions, Giant Worldwide and IndiCue, of $11.6 million. We acquired Giant Worldwide in January and IndiCue in the middle of February, we fully expect an even bigger revenue contribution from those acquisitions when we record their full impact in our next reported quarter.

Importantly, a significant portion of those revenues come from durable, recurring, fast-growing technology-based revenue streams from a large array of major studio and streaming customers, which was a major rationale for the acquisitions themselves. Based on preliminary results so far in our first fiscal quarter of 2027, we expect that these acquisitions will be an even bigger positive engine for our financial performance in the next reported quarter and beyond. We also recorded net income attributable to stockholders of $1.1 million, a 51% increase over the prior year period. This was driven by a $4.3 million bargain purchase gain on the Giant Worldwide acquisition and a $2.9 million income tax benefit primarily coming from the IndiCue acquisition. Both of those upsides are additional strong indicators of the quality of the deals we cut for both companies, as well as their upside value creation potential for Cineverse.

Overall, we believe that fiscal year 2026 was one of the most consequential years in our history. We followed up the unprecedented success of Terrifier 3, the highest performing unrated film in history, by quickly and decisively moving to convert that momentum into a structurally sounder and even higher growth company by completing the acquisitions of Giant Worldwide and then IndiCue in the span of six weeks during this reported quarter. These deals fundamentally strengthen and change what Cineverse is as a company. We are now a technology-first, AI-driven, fully integrated entertainment company with three powerful and mutually reinforcing growth engines. A proven low risk, high potential return, wide release film slate strategy, a scaled streaming and podcast portfolio with a vertically integrated advertising technology, and a media services business built around our Matchpoint technology platform.

As I just described, the positive financial impact has been immediate and will only get bigger going forward as we report full quarter results, finish integrating the two companies into Cineverse, and fully realize significant cross-business synergies across our technology and entertainment ecosystem. The strategic logic of these transactions is clear. IndiCue brings to the table a connected TV monetization platform serving more than 40 live clients, plus an additional 75 publishers onboarding. Giant Worldwide, now a Matchpoint company, brings deep and longstanding studio relationships directly into our automated media services ecosystem. Combined, this creates a powerful flywheel. Matchpoint’s automated content supply chain feeds IndiCue’s monetization engine, while IndiCue’s advertiser demand increases the value of every channel, film and TV title and partner we serve.

This expanded Cineverse flywheel, not any single channel, film, TV series, or distribution deal, is the key growth and performance engine behind our fiscal 2027 guidance of $115 million to $120 million in consolidated revenue and $10 million to $20 million in adjusted EBITDA, which we are reaffirming today. A significant portion of those revenues will be durable and recurring, and over 50% will be technology-based. Our franchise IP-based wide release film strategy continues to perform exactly as designed. High upside potential with limited financial risk. That’s because our strategy fully utilizes the tightly coupled Cineverse ecosystem technology platform and the flywheel I just described. Our upcoming slate includes the 20th anniversary theatrical re-release of Guillermo del Toro’s Oscar-winning masterpiece, "Pan’s Labyrinth" this October, presented in 3D and 4K formats.

When first released in 2006, the film received the longest standing ovation in the history of the Cannes Film Festival. That record still stands. We just took the film back to Cannes six weeks ago, where it was selected as the opening film of the festival. It screened before a packed house at the Palais Theatre and received a tremendous ovation and great critical reaction once again. Next up after "Pan’s Labyrinth" will be a much different type of film. It comes from an IP franchise that is also very beloved, this time by family audiences. "Air Bud Returns" in January 2027. We return to our horror wheelhouse with the latest installment of "Wolf Creek: Legacy" in March 2027. All three of these films closely follow the "Terrifier 2" and 3 blueprints of acquiring known IP properties with large built-in fan bases, high upside potential, and low financial risk.

These titles will generate recurring revenues for Cineverse by driving viewers and subscribers to our streaming channels and then becoming valuable long-term additions to our library. Expect more news about additions to our film slate that closely follow this formula very soon. With that, I’ll now turn things over to Sean for a financial review. Sean?

Sean McCabe, Chief Financial Officer, Cineverse: Thank you, Chris. First, a few highlights from our fiscal fourth quarter. Revenues were $26 million, up 60% from $16.3 million last quarter, and up 67% from $15.6 million in the same fiscal quarter last year. The increase was primarily driven by $11.6 million of revenue from our new advertising technology and media services revenue streams from our fourth quarter acquisitions of IndiCue and Giant during their first partial quarter. Net income attributable to stockholders for the quarter was $1.1 million, a $2.1 million improvement over the net loss of $1.1 million last quarter. This improvement was aided by $2.9 million of income tax benefits, primarily realized from the IndiCue acquisition and a $4.3 million bargain purchase gain on the Giant Worldwide acquisition.

Though the bargain purchase gain is non-recurring, we do believe it is a strong indicator of the quality of the deal price and the value creation opportunity for the company heading into fiscal year 2027. adjusted EBITDA for the quarter was $0.1 million, a decrease of $2.3 million from $2.4 million of adjusted EBITDA last quarter. Our direct operating margin for the quarter was 40%, down from last quarter’s 69%, and the prior quarter’s 55%. We anticipate our gross margin to evolve with our fourth quarter acquisitions based on the nature of their businesses, but more critically, we anticipate both margin and adjusted EBITDA improvement from quarter one to quarter four of fiscal 2027 as integration and cost savings initiatives are completed.

This quarter, we had a focus on acquisition integration and ensuring we get this right in order to put us on an optimized path as we head into fiscal year 2027. As a combined entity, we are reaffirming our previously announced guidance for fiscal year 2027 of $115 million to $120 million of revenue and $10 million to $20 million of adjusted EBITDA. The combined impact of Giant and IndiCue acquisitions represent a financial transformation for the company and are expected to create significant shareholder value. From a liquidity standpoint, we ended the quarter with $3.4 million of cash, our $12.5 million revolver still effective, and an ATM facility recently increased to $30 million. While our net working capital as of March 31st is negative $12.2 million, this does include $12.2 million of deferred consideration relating to the IndiCue acquisition, which the company has the right to pay in equity.

With that, I’ll turn it over to Eric to discuss our operating highlights in more detail.

Eric Opeka, President and Chief Strategy Officer, Cineverse: Thanks, Sean. First, I want to start with the review of where the industry is at and then turn to our operating results. Given the recent acquisition of Roku by Fox and the broader media environment where the industry is heading lines up directly with our direction, we think it’s strongly in our favor. Three shifts are happening at once. First is consolidation, as we’re all seeing. As companies scale, they’re tired of bolting together separate systems for delivery, encoding, ad serving, and data that were never built to talk to each other. They all want a single pane of glass, one system that runs the entire supply chain and works tightly together. That is, at its core, what our MatchPoint technology and operating platform now is. We built the operating layer for the media supply chain from ingestion through delivery through monetization.

Most importantly, this is the part I want to stress, there is no commercially available version of this at scale anywhere else in the market. A company that wants a fully unified technology stack today has two options: spend years building it or come to us, and that’s our moat. The second shift is that this same consolidation is opening lanes for smaller focused companies to scale quickly, and we serve both ends of that. The large platforms consolidating onto our stack and new challengers using it to evolve from a single app or content library into a full platform. For example, Gorilla Comedy+ launched a subscription service on MatchPoint this quarter, and we’re seeing the same pattern with lots of our other partners.

When a company decides to go from being a producer and content library into a platform, we’re the fastest and most affordable way to get there. The third shift and the largest is the move to ad-supported streaming and AVOD, or AVOD in particular. According to Nielsen, ad-supported viewing reached 74% of all U.S. time in the fourth quarter, the highest level of the year. According to eMarketer, ad-supported streaming now reaches more than 200 million people in the U.S., on its way to roughly two-thirds of the country by next year. The whole industry is racing to scale its ad-supported asset base, and Fox’s purchase of Roku is the clearest signal yet, a deal built around owning ad-supported on-demand machine at scale. Every company watching this now knows it needs to scale its own ad-supported business quickly and affordably.

This plays into our entire platform, not just one piece of it. Scaling an ad-supported business means preparing, delivering, and monetizing far more content than ever before. This is exactly what MatchPoint and Giant do on the supply side, and what IndiCue does on monetization, and it lets a customer run all of it inside one integrated stack, rather than stitching together a dozen vendors and giving up margin and data at every step. These projects are underway now, and we’re seeing customers plan for considerable scale into the back half of the year. We view this as a positive multi-year trend as the rest of the industry works to catch up with the kind of catalog scale that Fox and Roku are now combining. We’re not observing these shifts from the outside. They’re moving towards what we’ve already built.

We’re already seeing this rapidly evolve into a growth engine for us. Our unmatched ability to automate media delivery is letting major studios, channel operators, and streaming platform partners pursue initiatives that just weren’t achievable before. This is allowing us to expand and win work with them that Giant could not have done on its own or could we have done on our own. Pairing Giant’s two decades of studio trust with Matchpoint’s robust automation capabilities is winning significant work orders that we could never have won alone before the acquisition. As a result, we’ve continued to develop agentic software automation to rapidly keep up with this demand. Alongside that, we’re broadening our customer base and adding new customer logos across the business.

On IndiCue specifically, we’ve cut customer concentration by nearly half since we acquired it, with several new product innovations and initiatives rolling out over the course of this year, we expect that to keep improving materially. IndiCue’s net revenue retention sits at nearly 98% today, which bodes very well for the continued growth of our recurring SaaS revenue as we scale it. Now to our results. I’ll start with engagement because that’s where the growth is most visible. We ended the quarter with 1.52 million SVOD subscribers, up 13% year-over-year. More importantly, the engagement underneath that grew far faster. Streaming viewers were up 66% to nearly 130 million, and total minutes streamed rose 58% to 4.4 billion for the quarter.

Our engagement growing four to five times faster than subscriber base is exactly what we want to see, because it’s that reach and the first-party data that feed discovery, monetization, and the rest of the business, and ultimately provides the revenue growth in future quarters. It also dramatically expands the top of the funnel for our subscription business. On that subscription side, our fandom model is compounding channel by channel. Several of our SVOD channels hit an all-time subscriber high in the quarter. Docurama was up 47% year-over-year and has since crossed 100,000 subscribers in its eighth straight month of growth. Midnight Pulp was up 18%, with its Roku subscriber base more than doubling.

Meanwhile, our flagship Cineverse channel has grown every single month since we launched, driven first by its debut on Amazon, and now by its recent launch on The Roku Channel in May, where we introduced it alongside a new premium channel on Roku, So … Real. That free-to-paid funnel is working in real time. It’s turning our ad-supported viewers into paying subscribers. The ad-supported side was just as strong, which matters given where the industry is heading. Several of our biggest FAST channels delivered their most watched quarters ever. The Dog Whisperer was up 84% year-over-year, its eighth consecutive quarter of growth since launch, and Screambox was up 40%. Midnight Pulp, boosted by its launch on YouTube and Twitch, grew more than tenfold year-over-year on the ad-supported side. This is the AVOD momentum we talked about earlier, showing up directly within our own properties.

I also want to briefly address our investment in micro dramas. During the quarter, we restructured our investment in MicroCo, which is now rebranded as A Twist, moving from a joint venture into a passive minority stake. We believe in this space and intend to stay involved commercially because the growth and potential there are real. However, this approach lets us keep our attention and capital focused on our core business and recent acquisitions, but retain meaningful upside, avoid distraction, avoid dilution, and heavy investment in an early-stage joint venture. We think this is the right outcome for both Cineverse and our shareholders. The A Twist team is creating traction already, including with Paramount and other potential partners, and we look forward to watching them take on the premium end of a rapidly emerging space, where we leverage our content and technology assets across the entire growing micro drama space.

We still retain the ability to invest pari passu with other institutional investors as that business scales, if we choose to do so. At the same time, we’re maintaining cost discipline we committed to last quarter. We completed approximately $2 million in SG&A cost reductions through the end of the fiscal year and remain on track to realize the vast majority of the remaining $5.5 million of our $7.5 million cost reduction program by the end of the second quarter of fiscal 2027, while also capturing approximately $2.5 million in annualized synergies from integrating Giant into Matchpoint. As these cuts take hold, we believe our studio and streaming operations, inclusive of corporate overhead, are near run rate profitability. We’re building for scale, for margin, and for durability, as Chris mentioned, and the way this industry is consolidating only sharpens our advantage. We’re extremely well-positioned for the year ahead.

With that, operator, we can open up the line for questions.

Operator, Conference Call Operator: We will now begin the question and answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. We ask that you pick up your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from Dan Kurnos with StoneX. Please go ahead. Please ensure you are unmuted locally.

Dan Kurnos, Analyst, StoneX: Can you guys hear me?

Chris McGurk, Chairman and CEO, Cineverse: Now we can hear you, Dan. This is Chris. Go ahead.

Dan Kurnos, Analyst, StoneX: Okay. All right, great. Thanks, Chris. Good to speak with you guys. Good morning. Looking sharp into 2027 here. Nice momentum. I guess first question is, since you guys have completed and closed the acquisitions, any kind of initial learnings you guys have had? Any incremental business opportunities, revenue vectors that you’re thinking about? I know it’s early. On the synergy side, obviously great to see the synergy number coming up. Appreciate the update there. Can you just give us a cadence on how you think that’s going to play out and where you’re finding the incremental synergies coming from? Thank you.

Chris McGurk, Chairman and CEO, Cineverse: Yeah, I’ll let Eric get into more detail on that, but I got to say, both the acquisitions combined are performing better than we thought already, especially now that we’re seeing the integration being completed and we’re seeing the full monthly results of both of them. I think our surprise is that the flywheel that we put down on paper, it’s actually working better than we anticipated, and we’re really thrilled by both acquisitions and how they’re working together with Matchpoint and the rest of our business. Eric, do you want to add something on additional synergies?

Eric Opeka, President and Chief Strategy Officer, Cineverse: Yeah. Sorry if you can hear me there. Yes. Hi, Dan. I’d say, as we just came from StreamTV Show, which is the largest conference in the streaming media sector globally, actually, specific to the advertising space. Essentially, what we’ve assembled here with the various assets that we’ve acquired and combined into a platform is, as I noted in my remarks, it’s exactly what the market is really looking for right now. Scale is important. The days of sort of incrementalizing small libraries to compete, you need massive scale to reap the benefits of AI. You can’t have a few hundred titles. You need hundreds of thousands of titles. Partners are really looking how to scale up, and you just can’t do that with the manual processes that are out there.

I think our timing was prescient, and a lot of it was based off of our own experiences as operators in the market, seeing where that opportunity is. That operator experience sort of gave us an early vision into what the market was going to need, and it’s turning out to be quite true right now. In terms of incremental synergies, I think one of the big opportunities as we get to learn and understand these businesses, there’s what you know pre-acquisition, and then there’s what you know on the ground as you’re operating these businesses. We are seeing significant opportunities for optimizing these businesses, especially business like Giant that has good processes, but could stand to use a lot of the automated processes that we work with. A, we think that is something that we’ll be continuing to press over the quarters.

Obviously, we know Cineverse has strong international operations at a very good cost basis, which we haven’t really begun yet to exploit. I think those are two avenues. Lastly, combined integrated selling. We have a very large diverse team now selling a lot of different products. Getting those teams to cross-sell is a pretty substantial synergy that is really just starting and will be scaling up over the course of the year.

Dan Kurnos, Analyst, StoneX: Just on the revenue side, how are the conversations kind of networks and studios going, especially with Giant? On the IndiCue side, just out of curiosity, do you guys benefit from seasonality and political as we get into the back half of this year calendar-wise?

Eric Opeka, President and Chief Strategy Officer, Cineverse: Yeah. On two buckets. First on the large customer, large enterprise studio side. Once again, all of those partners are in scale-up mode or optimization mode. Studios that we know are in scale-up mode are effectively ramping up and want automated, highly visible solutions to scale their business and make more revenue. Those, we’re starting to see either both existing customers, which we work with a lot of the major studios already are scaling up, and then with new customers or other studios that need to dramatically overhaul or improve their operations are coming to us. We anticipate being in business with a lot more of them this year, if it breaks the way we think it’s going to break. The second part of your question, Dan, can you repeat that?

Dan Kurnos, Analyst, StoneX: Yeah, sorry. Just on do you benefit from seasonality and political as you would typically see with a DSP ad tech type company?

Eric Opeka, President and Chief Strategy Officer, Cineverse: We-

Chris McGurk, Chairman and CEO, Cineverse: Clearly, we’re going to benefit this year.

Eric Opeka, President and Chief Strategy Officer, Cineverse: Yeah

Chris McGurk, Chairman and CEO, Cineverse: That could be an upside to our guidance. Thank you.

Dan Kurnos, Analyst, StoneX: All right. Well, looks like you guys are off to a good start, appreciate the color, guys. Thanks so much-

Eric Opeka, President and Chief Strategy Officer, Cineverse: Sure

Dan Kurnos, Analyst, StoneX: Nice landing the plane on the acquisitions.

Eric Opeka, President and Chief Strategy Officer, Cineverse: Thank you.

Chris McGurk, Chairman and CEO, Cineverse: Thank you.

Operator, Conference Call Operator: Your next question comes from Brian Kinstlinger with Alliance Global Partners. Please go ahead.

Brian Kinstlinger, Analyst, Alliance Global Partners: The studios that you highlighted, how are the studios reacting to this combination? I know you’ve had some trouble with Matchpoint penetrating them. What are conversations like regarding converting to Matchpoint now that the combination is complete?

Eric Opeka, President and Chief Strategy Officer, Cineverse: I can take this one, and Tony can add some color on that. When we first started launching enterprise sales on Matchpoint, it’s the IBM Manageable. People want to have proof points that your product can be trusted in the market to handle scale opportunities. The good news is with the addition of Giant, we have a very strong over 20-year studio operating trust with those partners. That’s led to us being into major RFPs on a variety of different products and opportunities that we think it’s really demonstrating our ability to compete with the best in the industry. Beyond that, we’re finding that we’re either winning RFPs or look to be winning RFPs simply because most of the people we’re competing with have manual or semi-manual or partial solutions or systems integrators. They don’t actually control or own the full stack.

I think that environment has changed pretty dramatically, and it’s going to be a big part of our growth this year.

Brian Kinstlinger, Analyst, Alliance Global Partners: Great. Eric, you mentioned the streaming viewer numbers and KPIs are all up huge, I think year-over-year. Yet revenue without M&A is flat year-over-year. Can you speak to the market dynamics for the legacy business? Is there pressure on advertising? Is it challenging inventory fills? Just maybe speak to the legacy year-over-year comps.

Eric Opeka, President and Chief Strategy Officer, Cineverse: Yeah.

Chris McGurk, Chairman and CEO, Cineverse: I’ll let Eric respond, but just first of all, Brian, last year we had the spillover effect of Terrifier 3. We were still generating huge revenues in the ancillary markets after the theatrical release in October. That made the comparison tougher. It was the film performance last year. Go ahead, Eric.

Eric Opeka, President and Chief Strategy Officer, Cineverse: Yeah. In the ad market we saw probably the fastest growth in the FAST space in terms of channel and competition. You have competitors. Some studios have launched 80+ channels into the market, on top of adding in Netflix inventory, Amazon Prime inventory, and so on and so forth, every major streamer. I think the market really is just starting to have absorbed that volume of impressions in the market. That has obviously caused, I think temporarily, a depression in CPMs and fill rates. We’re starting to see that rebound. We think last year was kind of the low. I don’t think you’re going to see the same level of launch. I think the migration of ad dollars from television is still accelerating. CTV is still double-digit growth.

I think us having the audience and the share puts us in a prime position as that changes. Also, us owning an ad tech platform and having experts at monetization, we think that’s going to be an engine to take advantage of that audience and fill those impressions quite handily as they do already for a lot of their customers.

Brian Kinstlinger, Analyst, Alliance Global Partners: Great. One follow-up on financials. First, it’s two-part. Outside of political, can you just speak now to the overall seasonality of this new business combination? Maybe if December is the biggest piece, what % is that? Which quarter from revenue is generally the weakest in seasonality? On your EBITDA guidance, what does that equate, do you think, in a range of free cash flow, which includes content costs, capital expenditures, and any charges that are cash related to cost cutting?

Eric Opeka, President and Chief Strategy Officer, Cineverse: Sean, do you want to Well, I think we first all tackle the seasonality piece of it. Even though we’ve expanded the different lines of business, Giant and IndiCue still follow some of the seasonality that we had overall as a company. On the seasonality side, Q3, which is calendar Q4, fiscal Q3, is still going to be our heaviest quarter in terms of volume and revenue. IndiCue, that will sort of mirror to that. I think we’ve seen some of the IndiCue trends actually kind of buck Q1 being as slow as we would normally see on advertising. They’ve been able to maintain and manage scale and volume in that quarter. It won’t be quite the dip that we would see when we didn’t sort of control the ad tech stack.

In terms of Giant seasonality also does kind of match the entertainment cycle, where there’s usually typically a big demand going into calendar Q4 or fiscal Q3. It would probably be pulled about a quarter forward as companies prep to deliver lots of content going into that quarter. That’s sort of the seasonality impact. Sean, I think we can probably follow up with you on sort of the detailed financial questions. Sean, is there any color that you think we can give them on-

Chris McGurk, Chairman and CEO, Cineverse: Yeah. The question again, Sean, was how does the EBITDA guidance of $10-$20 match up with what our cash position might be at the end of the year?

Sean McCabe, Chief Financial Officer, Cineverse: Yeah. Just keeping it fairly iterative. Refer to the 10-K for the specific details. I’d say generally with the EBITDA improvement, I think you would see relief from the cash and liquidity perspective naturally as we work our cost savings in and increase the revenue. I would say I’d probably leave it at that. If there’s anything else, I think we have our recently increased ATM facility as well, which is a lifeline in case needed. I’d say generally, I’d say that you would expect from the guidance that we’d have an improving cash flow and liquidity situation.

Brian Kinstlinger, Analyst, Alliance Global Partners: Okay, great. Thanks so much.

Chris McGurk, Chairman and CEO, Cineverse: Thanks, Brian.

Operator, Conference Call Operator: Your next question comes from Laura Martin with Needham. Please go ahead.

Laura Martin, Analyst, Needham: Sure. Great, I’m going to ask three. The first one is your acquisition roadmap. What’s missing that would make this value chain you’ve assembled more valuable? Second, I’m going to ask about KPIs. Over the next 12 months, what KPIs are you going to be tracking internally and externally disclosing that will indicate to us whether you’re successful, whether the strategic pivot of doubling your size has actually been successful? Third, Eric, I would love for you to talk about microdramas. I remember having dinner with you and having sort of a dynamic debate, and now it sounds like you’re sort of stepping back from the microdrama business, and you guys were early adopters there. I’d really be interested in your learnings and what you learned about, I guess, financial limitations to the return on capital, presumably in the microdrama space. Those are my three.

Thank you.

Chris McGurk, Chairman and CEO, Cineverse: I’ll let Eric. This is Chris. Thanks for joining the call, Laura. Just on the microdrama piece, as we got into it, there’s just a huge level of investment that’s going on in that space right now. From the players that were already in the business, a lot of big Asian media companies own these platforms, and they’re spending, like, $1 million a day to market their platforms and their channels. Obviously, that ups the stakes quite considerably. You’ve seen a lot of the big Hollywood players get involved. I just think our gut feeling at the end of the day was we should be selling picks and shovels to that business versus getting involved in an arms race in that business and spending at the levels that the competitors were spending at. We can leverage our technology. We can leverage our content library.

We can leverage our ability to market using our ecosystem in a really smart way in that space in order to drive revenues and participate in the business. We think we can do it in a smarter, lower investment way, particularly at a time when we’re trying to assimilate these two great acquisitions and drive the business ahead. That was our thinking in that space. I’ll let Eric respond to your other two questions. Eric, acquisition roadmap and KPIs?

Eric Opeka, President and Chief Strategy Officer, Cineverse: I’ll start on the acquisition piece here. First thing is, as we look at what we see already working is, any business that we think could benefit from leveraging our technology to increase margins, increase scale, and provide us greater market share. We think the encoding and packaging space is pretty ripe for that most of those competitors sort of fit the same profile of the one we just acquired, where we think using technology and combined scale, we could add 20-plus points of margin to those businesses. We think those fit. Also, we think as we look at the supply chain tasks and capabilities that could plug nicely into our platform, other technology providers that provide critical automated services, but are maybe subscale on their own.

If you think of the various pieces of work, whether it’s metadata enrichment, AI enhancement of content, other things that you could put into a platform in the same way that, say, Salesforce could maybe verticalize and acquire things to put into their ecosystem. Same goes for us in the media supply chain. We think either things that bring scale or sort of support this flywheel are going to be on the track. Really on the KPI front, I think we’ve been talking about, clearly, we have a couple different businesses. We’re looking at for our software business, some of the usual, especially the SaaS business around the advertising, net revenue retention, increase in customer annual spends, and particularly on the media network side, looking at our TAC in that business, which all of those are being discussed now in terms of future KPIs to add.

Of course, in our services and media services business, it would be similar KPIs. Particularly as we’re looking at doing a lot of long-term contracts and more complex build-outs with studios, we think those sort of similar SaaS metrics will be applying to those businesses as well. Obviously, looking at software-like margins out of these services businesses, so really close margin look. Just to further the last thing on the microdrama side, I think since you and I spoke, there’s been about 400 microdrama service launches globally or something near that. Many of those, as Chris mentioned, losing hundreds of millions of dollars a year. We’ve been down that road in 2014, 2015, in the early days of streaming.

That’s why we’re, as Chris mentioned, in the picks and shovels business now quite heavily for that business, because I’d rather be selling content to 400 microdrama services and services than competing with 400 services. That’s sort of the rationale there.

Laura Martin, Analyst, Needham: Thanks very much. Thank you.

Chris McGurk, Chairman and CEO, Cineverse: Thanks, Laura. Thank you.

Operator, Conference Call Operator: This concludes the Q&A session. We will now turn the call back to Chris McGurk for closing remarks.

Chris McGurk, Chairman and CEO, Cineverse: All right. Thank you all for joining us today. Please feel free to reach out to Julie Milstead with any additional questions. We look forward to speaking to you all again on our next quarterly call, where we’ll see the full impact of the two acquisitions that we just made. Thank you all very much.

Operator, Conference Call Operator: This concludes today’s call. Thank you for attending. You may now disconnect.