LiveOne FY2026 Q4 Earnings Call - Balance Sheet Cleared, B2B Partnerships Accelerate, AI Monetization Looms

Conference Call Operator: Good morning, and thank you for standing by. Welcome to LiveOne’s fiscal fourth quarter and full year ended March 31st, 2026 financial results and business update conference call. During today’s call, all participants will be in listen-only mode. Following the presentation, the conference will be opened for questions. Presenting on today’s call is Rob Ellen, CEO and Chairman of LiveOne, and Craig Christensen, Interim CFO of LiveOne. I would like to remind you that some of the statements made on today’s call are forward-looking and are based on current expectations, forecasts, and assumptions that involve various risks and uncertainties. These statements include, but are not limited to, statements regarding the future performance of the company, including expected future financial results and expected future growth in the business. Actual results may differ materially from those discussed on this call for a variety of reasons.

Please refer to the company’s filings with the SEC for information about factors which could cause the company’s actual results to differ materially from these forward-looking statements, including those described in its annual report on Form 10-K for the year ended March 31st, 2026, and subsequent SEC filings. You’ll find reconciliations of non-GAAP financial measures to the most comparable GAAP financial measures discussed today in the company’s earnings release, which is posted on its investor relations website. The company encourages you to periodically visit its investor relations website for important content. The following discussion, including responses to your questions, contains time-sensitive information and reflects management’s view as of the date of this call, June 24th, 2026. Except as required by law, the company does not undertake any obligation to update or revise this information after today’s call.

I’d like to highlight to all participants that this call is being recorded. The company will make it available to investors and media via webcast, and a replay will be available on its website in the investor relations section shortly following the conclusion of this call. Additionally, it is the property of the company, and any redistribution, transmission, or rebroadcast of this call or the webcast in any form without the company’s expressed written consent is strictly prohibited. Now, I would like to turn the call over to LiveOne’s CEO, Rob Ellen.

Rob Ellen, CEO and Chairman, LiveOne: Good morning, everyone, and thank you for joining. This has been a transformational year for LiveOne. I want to start by applauding my team at LiveOne, at PodcastOne, at Slacker, and our merch business. Each of those subsidiaries have fought through this year and battled and turned this around. LiveOne reported this morning $77 million in revenues. Our audio business, $73 million, $73.5 million and $6.1 million in EBITDA. This is hugely transformative for the company. It’s been a tough battle. In 30-plus years of running public companies, we lost our major customer, Tesla. We lost $65 million out of $75 million in revenues. We took punches from our debt holders, our banks, our investors in a brutal market. At one point, it felt like the Knicks game. I’m wearing my Knicks hat today as this was comeback time for LiveOne. Our teams rallied and did not quit.

As you look at our podcast business, Kit Gray showed up as our Jalen Brunson. He took that business and has now grown it from the time I acquired it from $17 million, this year, we did $61 million, with $6.3 million in EBITDA. When we acquired the business, it was losing $6.5 million a year. That’s a $12 million swing in EBITDA. As you look at this first quarter, we’ve just raised our guidance and raised our guidance to $78 million-$85 million with $8 million-$10 million of EBITDA, and we’re already doing close to $2 million of EBITDA for the quarter. You’re on an $8 million run rate off the slowest quarter. At LiveOne, we survived our banks pulling out. We replaced them. We have now paid down all of our junior debt.

We have now converted over $15 million of equity at $7.5 a share. We have cleansed our balance sheet dramatically. Now is the time everyone has fought through this year to start to see this business turn and go back in the direction where we started. We traded for almost five years between $40-$100 a share. We went through a tough period of time during COVID. We came out stronger than ever. We’ve gone through a tough period of time with Tesla, and we’re coming out stronger than ever. Our B2B lineup is growing dynamically across many verticals. As you look at the past announcements that have just come out in this quarter, this current quarter, we’ve announced partnerships with Vizio, which is part of Walmart. We’ve announced partnerships with Samsung. We’ve announced partnerships now with AT&T. AT&T will now reach over 70 million people and growing.

As you continue to add these to our current lineup of B2B deals, we also added LG to the lineup. If you take the combination of just those alone, there’s hundreds of millions of monthly eyeballs. As you now look up forward, we expect to announce our next major partnership with a retailer with over 50 million monthly subscribers. We’ve already talked about going through phase one and the success of it, and the success of the sign-ups that came at almost 46%, way higher than we could have dreamed. When you look at the Tesla partnership, there were only 2 million cars. Consumers had to sign up for $10 a month, and somehow we ran from when we acquired the company, we acquired Slacker Radio, doing $200,000 a month to doing $65 million-$70 million a year and growing. We have now started to replace that.

Part of that replacement came with a really exciting partnership with Amazon, now over $20 million, that it was paramount. When it first started, it started at Pluto TV. It started as a $2 million deal. It’s now over $26 million. We continue to grow these. We see telltale signs that these partnerships will all look similar, that if you just can convert a half a percent to 1% of their total audiences, we could be looking at hundreds of millions of dollars in the next two years and $1 billion over the next five years. We couldn’t be more excited about where the business is going. We wanted to show the street our hand. Right? We rallied back. What did we do? We bought back a substantial amount of additional stock.

We now said we bought over $7 million stock in the free market and that we have $5 million additional to acquire. We also have bought a substantial amount of PodcastOne stock back. If the company is going to continue to trade at these discounts, we are going to continue to acquire, we’re going to continue to buy back, as well as you will see me personally buying a sizable position back in the company. I bought as high as $60 a share, and I certainly will continue to buy down at these low levels. With that, again, I want to thank my management team for successfully surviving a uniquely difficult period of time, and for coming out of it stronger than ever. We feel like these B2B deals are starting to build momentum. We have over 100 in the pipeline right now.

Everything from hotels to airlines, things to streaming networks, to audio companies, carriers, auto companies. We see the telltale sign that these will continue to grow. With that, I want to pass this over to Craig and give him an opportunity. Craig has joined us on an interim basis, but hopefully for long-term, has done just an amazing job of harboring the ship and getting the 10-Qs and 10-Ks done, and brings a very prolific background as CFO, as well as real serious experience in M&A, doing over 20 acquisitions in his last company. Craig, take over from here, and then I’ll jump back in and finalize everything. Thank you.

Craig Christensen, Interim CFO, LiveOne: All right. Thank you, Rob, and thanks for that intro. I’ll just spend a few minutes here providing a brief overview of our results for the fourth quarter, and then I’ll cover the full fiscal year. Some of these numbers Rob commented on, the consolidated revenue for the fourth quarter was $18.9 million, with positive adjusted EBITDA of $300,000. Our audio division revenue for the fourth quarter was $18.3 million, with adjusted EBITDA of $2.4 million. On a U.S. GAAP basis, consolidated net loss was $7.6 million or negative $0.65 per basic and diluted share in the fourth quarter of fiscal 2026. Our PodcastOne subsidiary produced Q4 revenue of $15.7 million and adjusted EBITDA of $1.9 million. Our Slacker subsidiary produced Q4 revenue of $2.6 million and adjusted EBITDA of $600,000.

For the full year, our revenue for fiscal 2026, as Rob mentioned, was $77.1 million, adjusted EBITDA of negative $900,000. Our audio division produced full year revenue of $73.5 million and adjusted EBITDA of $6.1 million. Down at the operating level, Slacker reported full year revenue of $11.8 million and adjusted EBITDA of negative $200,000. Our PodcastOne subsidiary produced record full year revenue of $61.7 million and $6.3 million in adjusted EBITDA. As Rob mentioned, we’re very pleased to report strong continued growth at our PodcastOne subsidiary. We expect that to continue throughout the year. We’re advancing several strategic partnerships from our business development pipeline that we believe have potential to drive long-term growth and value creation. In fiscal 2027, we believe the company’s well-positioned for transformational growth, new B2B partnerships, and potential M&A transactions. Rob, that’s all I got. Back over to you.

Rob Ellen, CEO and Chairman, LiveOne: I think you hit that great, Craig, I think maybe the most important line there was just at Slacker, right. Revenues are down so far, yet we took all these costs out of it and have the adjusted EBITDA as positive. You’re going to see every subsidiary in this company with adjusted EBITDA positive. You’re going to start to hear us talk about at the end of the year about our $225 million, $230 million NOL, and as those NOLs start kicking in and we start talking about earnings, it’s a very different game for everybody. With that, we’ve raised our guidance to $85 million-$95 million, with $8 million-$10 million of EBITDA. That is a massive turn here. We fully expect that if these B2B deals continue, that we’ll be looking at increasing those guidances down the line.

We think it’s a great starting point coming off where we were last year and a telltale sign of where the business is headed. Craig has mentioned the potential of acquisitions. If you read the press release, we said we expect a very accretive acquisition coming imminently. We are highly confident that this is now the time to add additional podcasters, additional revenues, additional traffic, and additional talent to our platform. With that, we finished number seven on Podtrac. We’re moving up the charts dynamically. We’ve been top 10 all year, and we see the really exciting times now that the company is really well-positioned to complete those acquisitions.

We have also, again, protected ourselves from the standpoint of we’ve had so many inbound calls on the company that we brought J.P. Morgan’s bankers back in to make sure that we explore all options, and protect ourselves in case a lowball bid comes in. With that, we will continue to buy a substantial amount of stock starting next week. We will continue our buyback and show our confidence in why this company is so undervalued. You look at the industry, I did an interview about two and a half, three weeks ago. I said, "You’re going to watch a roll-up of this industry that’s going to be very dynamic." We haven’t seen that in media in almost seven years. Everything from Roku being acquired at $22 billion. My close friend Charlie Collier, really exciting to see that. You see Lions Gate stock more than double.

You saw iHeart stock go up almost 7X. Media is back. People are waking up and realizing that it’s not just media. Media is also data. As you look at data, we have a massive amount of data. We have 250,000 hours of video content, plus we have over 500,000 hours of audio content. Each of those are growing dynamically, and I think you’re going to see some of the monetization across these AI platforms. They’re going to desperately need more and more data.

As you watch that acquisition of Warner at $46 billion above where Netflix was willing to pay for it, a big part of that reason, I don’t know why the world’s not talking about it, is that you’ve watched David Ellison, whose father is Larry Ellison, who owns Oracle, for the first time in history, take $90 billion of debt, and they say it’s going to go up to $150 billion. What is he going to need for a data business? What is he going to need to keep building his AI models? He’s going to need data, and a beautiful place to get that is from content. We’re well-positioned that our content could monetize in a very unique way across AI and fully expect to see some monetization coming from it almost imminently in the AI world.

With that, I’m going to open it up to questions, I want to thank everyone for joining and their patience with us and our patience with our team, we will continue to fight hard. Again, we see this year as a really exciting, transformational year for our company on the upside going forward. Thank you.

Conference Call Operator: Thank you. We will now begin the 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. 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 the line of Barry Sine with Litchfield Hills Research. Barry, your line is open. Please go ahead.

Barry Sine, Analyst, Litchfield Hills Research: Hey, good morning, Rob, and welcome aboard, Craig. Rob, I want to start off asking you about the AT&T deal. Obviously, a huge new partner, you’ve been talking about a carrier for some time, so you’ve delivered. Wanted to get a little bit more information. From the release, it sounds like they’re going to sell a package to automobile manufacturers, OEMs. What’s the status there? Have any been signed? When might we see some revenue from this new relationship? Thank you.

Rob Ellen, CEO and Chairman, LiveOne: Yeah. A lot of questions in that. What I would tell you is this, is that historically, music subscription, the largest partners have always been carriers. Right? As you know, Barry, I owned Kazaa previously and did well over $100 million with carriers. When I built Digital Turbine, almost all of our revenues came from 58 carriers around the world. Right? This is a massive opportunity. Right? This is now the opportunity every time you go into your car, all of a sudden, your LiveOne app will show up in the car, and you’ll have an opportunity across AT&T Mobility to be able to sign up, be able to utilize, and be able to drive. There’s multiple different revenue streams come from this.

One is the current user, two is new users, we are highly confident that, as you can see by the press release, not only did AT&T announce this themselves, they put their symbol in. They put Cisco in as a partner, they are highly confident that they’re going to be a great strategic partner to help both businesses grow. Just like Tesla did, utilize music to sign up for their platform. Really exciting partnership, there’s 67-70 million so far has had a program for this and growing. They’re basically taking the entire market in this.

We’re really excited about this partnership, I think you’re going to see more carrier relationships, I think you’re going to see deeper carrier relationships as the cycle is changing, right, people are waking up that all these companies are infringing upon each other’s businesses, AI is so critical to their survival. What is that about? That’s about data. If they don’t own their own data, they’ve basically handed most of their data to Apple and Android for the last 10 years. As that changes and as that cycle changes, they’re going to start fighting for that data, I think we’re well-positioned to be able to take a piece of that, I think this will be the first of potentially many carriers around the world

Barry Sine, Analyst, Litchfield Hills Research: Okay. Rob, you mentioned AI, you’ve talked about monetizing the content you have. I want to ask a couple of questions on that. I understand the opportunity for licensing the PodcastOne content so the AIs can learn more to speak like real people. Are you also going to monetize the LiveOne catalog, things like music festivals or some of the interviews you’ve done? How many are you negotiating with? Have you signed any? Again, revenue timing, when we might see some revenue from AI deals show up in a 10-Q or a 10-K?

Rob Ellen, CEO and Chairman, LiveOne: Yeah. Being very careful in that, I would say it’s imminent. With that, I would say that there are multiple parties coming very aggressively, looking at this and looking at the space. You’re reading about it on a daily basis, and Barry, you did some of your own research on this, and people are talking about $100-$500 per hour of content. That’s just for the practice models. All you have to know is if you went onto your AI models, if you went onto the LLMs and you went onto them 10 weeks ago and you wanted to change your face to James Bond or Mickey Mouse, you could do it very easily. Now you couldn’t even come close.

What’s happening, there are war rooms in every single law firm right now that the major media companies are fighting these AI companies, and you’re going to see lawsuits. CNN just filed one last week. There’s going to be lawsuits everywhere. They’re going to block everything they can until they can figure out what the model is. These models are no different than Napster in the old days or when we dealt with Kazaa. You’re going to deal with it. It took 17 years for YouTube to settle this. What’s going to happen is secondary content, and I don’t mean secondary from the quality of it, secondary content that you have access to. Very differently with podcasters. Podcasters own their own content in conjunction with PodcastOne.

Whereas if you’re on CBS, there’s only a few people in history like Dr. Phil who’s on our platform or Oprah actually own their own content. It was owned by CBS. Now you’re going to have this wide-open field that are 250,000-plus hours, and that’s just what we’ve collected from the first 17 podcasters. We’re digging into it. It’s probably way higher. Our 500,000 of audio content, we have to look back 24 years to get it. Shockingly, our codes have what looks like very unique value. We’re exploring all options and have multiple bidders. We’re looking for the right partners. We’re making sure the contracts make sense, make sure we can protect our talent. Number one, we’re always a talent-first platform, but I would expect that some revenues are going to come in imminently.

Barry Sine, Analyst, Litchfield Hills Research: Okay, my last question is on Tesla, the process of converting free customers into paying customers, and then on the free customers, the process of monetizing those with, I’m guessing, programmatic advertising insertions. How are you doing in terms of the revenue recovery from the Tesla relationship?

Rob Ellen, CEO and Chairman, LiveOne: Yeah, it is doing good. Listen, this is a tough process, but at the same time, we have somehow, miraculously, we are now up to 1.3 million Tesla users. The average user is using it, I think we just said 69 minutes a day. If you have access to them 69 minutes a day, and for any of you that have a Tesla car, you walk in the car, it is pretty magical. You walk in and you see the LiveOne button there. That did not exist for the first 12 years of that contract. Before it was a squiggly orange button that you did not really know what it was. If you listen to our hosts, you could hear Slacker Radio, you could hear LiveOne. The reality is you did not know who it was. You just knew it was a radio inside Tesla.

You see that button and now that button is there in perpetuity. I was literally just in an Uber the other day, and you walk in and it is a brand-new car and there is the LiveOne button. I think we are going to convert. I think we are going to be very successful at it. We have done way better than we expected already. We are using AI tools, AI marketing tools, Meta and other things that we are going to very aggressively start to try to convert those subscribers. We have done a nice job so far. As you can see, somehow our cash position went up, even though we have still been spending money paying off settlements around this whole loss of revenues. It is really exciting to see. We have also been able to, because of that, pay off all of our junior debt, part of our senior debt.

The balance sheet is literally the strongest it has been with some of the help of doing those conversions. I think it is really exciting. I think we have got to keep getting smarter on how we convert those people. I think we have got to get our prices higher. We have not raised them yet, even though everyone in the industry has raised them dramatically. We have to figure out what that balance is between them. I have got to tell you, no one ever expected. We thought we would get maybe 25% of the audience, and now we are back to well over 50% that we have a legitimate shot at starting to convert.

Barry Sine, Analyst, Litchfield Hills Research: Okay. I will renew my subscription before you raise your prices. Those are my questions. Thank you.

Rob Ellen, CEO and Chairman, LiveOne: All right. Thanks, Barry. Thanks for your support.

Conference Call Operator: Your next question comes from the line of Sean McGowan with Roth Capital Partners. Sean, your line is open. Please go ahead.

Sean McGowan, Analyst, Roth Capital Partners: Thank you. Good morning, Rob, and hi Craig. Nice to meet you both. First question starting off, when will the 10-K be published, issued?

Craig Christensen, Interim CFO, LiveOne: Sean, it’s Craig. We’re aiming to get it out the end of this week, but we have until Monday, which we don’t plan to use, but we have till then. It’ll be out this week.

Sean McGowan, Analyst, Roth Capital Partners: Okay. Thank you. A lot of questions around things that have changed subsequent to the quarter, kind of that would be helpful to update a model. Can you give us a sense of standing here today or kind of at the end of June, what is the share count now? Talk a little bit about what’s out there that’s convertible versus eliminated with some of the moves made more recently.

Rob Ellen, CEO and Chairman, LiveOne: Say that one more time, Sean, you cut off at the end.

Sean McGowan, Analyst, Roth Capital Partners: Sorry. About the share count as of today, taking into account a lot of the changes that you’ve made to the balance sheet in recent weeks. If we just take today forward, I know it’s not going to be that for the first quarter, what’s the share count today and what’s still on the balance sheet that’s convertible?

Rob Ellen, CEO and Chairman, LiveOne: I think most of it that’s convertible has been converted. I think we said today that 15 million total was almost completed, right? You’ll see another, I don’t know, probably from last quarter, probably 1 million shares total in that range. In those 1 million shares, these are in unique hands. These are the first time that we’ve signed long-term partnerships with many people in the industry, right? From BMI to Merlin, with that, we’ve also added over 20 million songs to our portfolio, right? In adding those 20 million songs, as most of you know, most of my background has been building off of carriers around the world and mobile businesses, right? We’ve never been able to and have chosen not to because it wasn’t worth it at the time to really expand overseas.

This now gives us the opportunity that we now have a global presence that we can really start to, as we do an AT&T deal. There’s no reason I can’t go back to the many carriers that we’ve worked with over the years to expand. As you know, I’ve been in Paris, London, Mexico three times, Japan, China, and Switzerland where many of the same partnerships that I did with Digital Turbine, that I did with my other companies for the last 30 years, right? We couldn’t really partner with them before because it didn’t make sense to expand overseas till we had the balance sheet cleaned up, especially from the standpoint of the record labels and the publishers. We’re almost completely clean at this point, and I would say this is the best shape we’ve ever been in from a balance sheet standpoint.

Sean McGowan, Analyst, Roth Capital Partners: Good. Thanks for that clarity. Other question was on operating expenses, since you’ve done a good job of cleaning a lot of that stuff up and as you had hinted in the past, using AI and other tools to get more productive. That’s encouraging. If you look at the operating expenses in the fourth quarter, should we expect things to kind of trend the same way? Or were there any expenses taken in the fourth quarter that you would consider non-recurring?

Rob Ellen, CEO and Chairman, LiveOne: Craig, you want to take that?

Craig Christensen, Interim CFO, LiveOne: Yeah. Barry, I think the quarter is probably a good baseline to trend off of because you can see that throughout the year, the company did fantastic at trying to cut costs with the contraction. A lot of those were permanent or salary-based. I think the G&A is stabilizing. The company’s in great position now, I think, on a meaningful B2B deal or an M&A transaction to scale. There wasn’t a lot of big one-time puts or takes in the quarter, I think it’s stabilizing and it’s a good model.

Sean McGowan, Analyst, Roth Capital Partners: My last question on OpEx is, as you’ve said repeatedly in the past, you plan to use more stock-based comp with the podcast talent, and we see that in the financial statements. How much of that non-employee stock-based comp is taken outside of G&A? Is any of that in cost of sales?

Craig Christensen, Interim CFO, LiveOne: Yeah, it does. It’s in cost of sales. When we pay the talent or talent takes stock, it’s in cost of sales.

Sean McGowan, Analyst, Roth Capital Partners: Could you say that most of that non-employee stock-based comp is in cost of sales?

Craig Christensen, Interim CFO, LiveOne: Yes.

Sean McGowan, Analyst, Roth Capital Partners: Okay.

Craig Christensen, Interim CFO, LiveOne: Yeah.

Sean McGowan, Analyst, Roth Capital Partners: That’s helpful. Thank you.

Craig Christensen, Interim CFO, LiveOne: Yep.

Rob Ellen, CEO and Chairman, LiveOne: Sean, I think you’re going to see for the first time ever, the relationship with the talent is so strong that not only are they taking equity, but they’re also becoming real participants in this. We think it’s going to be very strong to have 1,000 podcasters, 250 that are most of our revenues, but those podcasters behind the stock as well and behind the company, right? Really helping to drive the brand and the recognition. Kit and the team have just done an exceptional job. We moved up to number 7 on podcasts. You’re watching the second round of acquisitions happening in podcasts right now. OpenAI bought a podcast network for 13.6 times revenues. Fox is buying everything they can get their hands on, right? They bought The Box and so on.

You’re seeing round 2 of those acquisitions, and it’s not by surprise because it’s no longer an audio business, right? I think when I first bought the company in 2020, I went on Adam Carolla on Fox News and said, "This is not a podcast business. This is a vodcast business." A vodcast, meaning that it’s going to move to video. The industry’s grown from $600 million to $25 billion. It’s going to $100 billion over the next seven years, right? You’re just going to see massive growth coming out of this, we’re just so well-positioned, and we want to make sure that our talent is a participant in the upside. We want them all rowing in the same direction. You may have seen Adam Carolla. I put my brother on his show this morning. I’ll be going on either next week or the week after.

As he goes on to Fox News, we want to be talking together as a force. We want to be talking as a team. Yeah, I just think we’re in the strongest position with talent that we’ve ever been in the company, including cleaning up those balance sheets on the music side. The more we can clean up, the stronger the relationship’s going to be with everyone.

Conference Call Operator: A reminder, if you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. Your next question comes from the line of Brian Kinstlinger with Alliance Global Partners. Brian, your line is open. Please go ahead.

Brian Kinstlinger, Analyst, Alliance Global Partners: Great, thanks. Nice to see all the new B2B announcements. You mentioned on one of the earlier responses that 1.3 million Tesla users you’ve got an average of 69 minutes. Can you quantify the number of conversions? Are you at 1% conversion? Are you at 5%? Somewhere in between? Then maybe can you talk about where you bottomed for the total business at paid subscribers and where you are today?

Rob Ellen, CEO and Chairman, LiveOne: Yeah. It’s a tricky one that I don’t think I can answer exactly yet, Brian, because we still lose some of the old. As cars go off the road, we lose some. We lose some of those old subscribers at $3, and we gain them back at $5. I don’t have an exact number in front of me right now. If you don’t mind, we’ll talk offline. I’ll try to get you an exact number on it. I can tell you that I think we said it’s about 1% or 2% we’re starting to convert over the last couple of months. We’ve had overall positive numbers. Our ARPUs are going up, and we’ve had overall positive numbers the last two months.

Brian Kinstlinger, Analyst, Alliance Global Partners: Just to the roughly total paid subscribers, I’m trying to back into it. Is it around 200,000? Is that too many?

Rob Ellen, CEO and Chairman, LiveOne: Do you have a number on that, Craig, in front of you?

Craig Christensen, Interim CFO, LiveOne: Sorry, I don’t have an exact number, Rob, but I think that is a good estimate, Brian. It’s kind of in that range.

Brian Kinstlinger, Analyst, Alliance Global Partners: Great. Then you’ve got a number of agreements in place that you’ve announced. Let’s take Vizio in February. I just know that date. All of them have a time you announced them. How long before you think it takes before you see meaningful additions to that paid subscriber base? Is that months? Is that immediately? What is the average timeframe you think a user converts?

Rob Ellen, CEO and Chairman, LiveOne: Yeah, I just looked at the numbers. Vizio was signed February 23rd. That’s the end of February. These typically are going to take 90 to 180 days before you start to really see revenue start to kick in. Just to give you an example. On Amazon, which is now $20 million, it took 11 months before it kicked in. There were some nice revenues, but really the revenues kicked in at 11 months, and then it started to really take off. Paramount was the better part of, it started off as a $2 million deal. Now it’s $26 million plus. That took the better part of 14 months for the real revenues to kick in. Each of these, they’re going to start.

As they get launched, as they start to grow, you start to get your feet under them, you start to understand what the consumer behavior is going to be. The consumer behavior changes every day, as you know, with what else is out there. We utilize our partners to market it with us and to build with us. The beauty of it is that we don’t spend a nickel, not $1 marketing it. This is all utilizing. We’re partnering with them because they have massive audiences, just like I did in Digital Turbine, just like I did in iWon, just like I did in Majesco. These are those B2B deals that they have the audience, they need the content. We’re making a trade. No different than when cable and satellite, if ESPN or Disney came to cable and satellite, they were getting paid by them.

I think that’s the direction of where things are going. I think that’s directionally where it’s going to happen now. You’re going to see these streaming platforms digging in deeper and deeper. You’re seeing the streaming platforms going deep into podcasts. You’ve just seen Netflix announce a deal with iHeart. iHeart’s stock went up 7X. You just saw them do a deal with Spotify. They just bought a podcast for $100 million. Does less revenues literally than one of our podcasts. They paid $100 million for it. It’s really exciting to see what’s happening, and that cycle’s changing. As long as we could keep signing these partners with massive audiences, getting them to market to their consumers, just like Tesla did, utilizing our content to sign them up, we’re going to be in great shape.

Brian Kinstlinger, Analyst, Alliance Global Partners: Awesome. As it relates to your three TV partners, I assume you’re able to monitor traffic. Can you share maybe unique TVs that have watched or listened to your content? How many repeat users are there? Are each of those three OEMs marketing the paid subscription to these viewers? Is that how it’s going to work?

Rob Ellen, CEO and Chairman, LiveOne: Yeah. Each deal is going to be a little bit different. We can’t give you metrics yet. Those deals were all announced in end of March. You’re literally looking at hours since we’ve gotten started in those. We’ll have way better metrics, I would say probably September, October, November. In that range, we’ll have way better metrics of where they’re going and which partnerships are working better and which ones are delivering more subscribers.

Brian Kinstlinger, Analyst, Alliance Global Partners: Outperforming

Rob Ellen, CEO and Chairman, LiveOne: Which ones are actually.

Brian Kinstlinger, Analyst, Alliance Global Partners: Yeah

Rob Ellen, CEO and Chairman, LiveOne: Not just that, because sometimes they’re doing a better job. You’re signing free subscribers, but you’re signing a big pool of them, but they’re pushing them, and you can end up with way more down the line. We’re still in the beginning phases of those. Obviously we have our next big one coming that we expect to be for sure this quarter. It’s been delayed a little bit. We expect another gigantic one to be hitting any minute now.

Brian Kinstlinger, Analyst, Alliance Global Partners: For the TVs, are they pre-loaded the app on each of the three or just a few of them? Did the users have to go find and download that app?

Rob Ellen, CEO and Chairman, LiveOne: No, they’re pre-loaded.

Brian Kinstlinger, Analyst, Alliance Global Partners: On all three?

Rob Ellen, CEO and Chairman, LiveOne: I would say by now you can find, I don’t know if it’s every TV, but certainly the most recent TVs, which I don’t think has really changed in the last five years. Okay.

Brian Kinstlinger, Analyst, Alliance Global Partners: Yep.

Rob Ellen, CEO and Chairman, LiveOne: I think you can find it if you go look. I’ve had multiple shareholders call me, say they found it, and they get excited about it. Just like when they see in a Tesla. Our brand is getting a total refresh without spending a dime. Think about what it costs for SiriusXM to buy their way into cars and so on. We’re getting ourselves into these places without spending a nickel on it. We’re not paying them. We’re hoping they’re going to be paying us substantial money for our great content.

Brian Kinstlinger, Analyst, Alliance Global Partners: Great. I have two more. The first one is relates to AT&T. I know previously Slacker Radio has been pre-installed on a number of different cars. Why is this different and more advantageous with your integration to AT&T with these OEMs?

Rob Ellen, CEO and Chairman, LiveOne: They’re trying to capture the inside of cars. They’re trying to capture that home screen. There really wasn’t a home screen previously. That home screen didn’t have much value. Now home screens are growing, as you see, just my humble opinion, the robo cars are being launched right now. You’re watching more and more of the Google cars out there. It’s really fascinating. Every kid wants to take these cars. Nobody wants to drive. The bigger the screen gets, the bigger the opportunity gets. That screen now, when you go into a Tesla, we’re one of five buttons that shows up when you get in the car. You could change it if you choose to and get rid of it. When you go in that car, that button’s sitting there day one. That’s where we want to be.

As many places as possible, we want to see our logo, our banner sitting there. Somebody presses a button, all of a sudden they become a free or paid customer.

Brian Kinstlinger, Analyst, Alliance Global Partners: With AT&T, you’re on that front page, whereas before with some OEMs, you weren’t necessarily on that page. Is that right?

Rob Ellen, CEO and Chairman, LiveOne: No, I would say differently. With AT&T, they’re doing what Tesla did. Remember with Tesla, this was an amazing run. It took 12 years to get there. When I bought the company, we were doing $200,000 a month with them. What they did was, they used the music to sign up their subscribers. Music is so sticky. Once you sign up, you’re not going to get rid of it. What we’re hoping for here, and the way that their position is a three-way partnership with us and Cisco and them. They’re going to use the music to get the people to use their platform. That’s how they’re going to get them excited and ignited about it.

It’s a huge branding and huge advertising for us that would cost millions and millions, if not tens of millions, for us to buy that space to get into that. They’re going to market us in every way, shape, and form. They’re going to come out and say AT&T. They’re going to the OEMs and going to those car companies and going, "We’re coming in with a music partner. We want to give you content right off the bat.

Brian Kinstlinger, Analyst, Alliance Global Partners: Okay. My last question, I think one of the previous questions was about G&A. I think in general is what, and OpEx, because in the fourth quarter, it was slightly higher than each of the previous quarters. What is EBITDA guidance range if you included corporate overhead for this year?

Rob Ellen, CEO and Chairman, LiveOne: Well, I would say corporate overhead is now down to, Craig, what, about $3 million? $2.7 million-$3 million? In that range. You could use about that range.

Brian Kinstlinger, Analyst, Alliance Global Partners: Okay.

Rob Ellen, CEO and Chairman, LiveOne: We’ll have a lot closer number. One of the things I have mentioned, which I fully expect to happen soon, that for the first time ever, we will be hiring for the first time in a long time. We’ve been cutting, I am going to be stepping down as president and hiring a world-class president this quarter who has built and exited a $1 billion to multi-billion dollar public company. There will be some additional overhead that’ll be added, that’ll have to be post this acquisition. As we add this next acquisition in, which will be extremely accretive to revenues and bottom line, you’ll see almost simultaneously, right around it, you’ll see a new president of the company.

Brian Kinstlinger, Analyst, Alliance Global Partners: Great. Thanks for answering all my questions, Rob.

Rob Ellen, CEO and Chairman, LiveOne: Okay. Thanks, Craig.

Conference Call Operator: Your next question comes from the line of Sean McGowan with Roth Capital Partners. Sean, your line is open. Please go ahead.

Sean McGowan, Analyst, Roth Capital Partners: Yeah. Thanks. Thanks for the chance for a follow-up. Just kind of circling back on your comments on the expected ramp up toward the end of the year of some of these deals, if they take 90-180 days. I take from that we should expect a lot of this incoming revenue to be back-end loaded. What does that say about the expectations for operating expenses? Will they also kind of follow a similar trend, or will they be more steady throughout the year?

Rob Ellen, CEO and Chairman, LiveOne: No, I don’t think our operating expenses are going to really change in that. I think the margins and bottom line will just get better. We’re trying to be uber conservative. You and I had this conversation at 4:00 A.M. this morning, Sean. We’re trying to be uber conservative about the guidance of where we’re going. We’re highly confident that this will be extremely accretive to the business. When you talk about the AI business, that’s just money in the bank. There’s no additional cost to that. We web share it with our talent, but there’s no additional cost. Our movies, television shows that are at the studios right now, we have one of them right now that over $5 million has been spent by a studio if they green-light it. That could be millions of dollars the first year to tens of millions over the next few years.

There’s no additional cost to it. We really built this dynamically now. We do not expect to grow the team very much. Maybe we’ll add another B2B person to head up retail, a B2B person, head up auto, and a new president of the company. That’s really it. I don’t really see much additions to this team. We’re pretty well-suited right now. AI has really given us just a dynamic advantage to cut our costs dramatically. The cost of programming, the cost of coding, the cost of building apps, all of it has gone down so dramatically, and the cost of having humans and sitting in the seat of DJs and so on, we don’t need that anymore. We don’t need them. We need a very small group to do exactly what we were doing before and more.

Sean McGowan, Analyst, Roth Capital Partners: All right. Thank you very much, Rob. Appreciate it.

Conference Call Operator: There are no further questions registered. I will now hand back to Rob Ellin for final remarks.

Rob Ellen, CEO and Chairman, LiveOne: I want to thank you, everyone. Great questions. I appreciate everybody spending the time, and I appreciate the support from everybody. We really do believe this is going to be a spectacular year for the company. I’m a Knicks fan. I just watched one of the greatest comebacks ever. I feel like we’ve done a lot of the same things here. I don’t know if we were down 29 going into the fourth quarter, but it was pretty close. When you lose your biggest customer and you lose that much revenues overnight, even though they gave us a great opportunity going forward, it takes a lot to recover from that and a lot to fix it. This team has just really sharpened their pencils, fought through, battled through, cleaned up the balance sheet to the best it’s ever been in the history of the company.

Paid down junior debt, paid down some senior debt, really positioned the company now to back to being a growth story, and back to being in a position of really being a thought leader across audio as well as podcasting, that pushes you into both audio and video. Yeah, I think we’re really well respected in the industry. We got to get that same respect in The Street. In the interim, until we get there, we’re going to be buying back stock, if that’s what it takes, we just keep buying back stock. If we’re going to trade at one-third of what the industry is trading at, we’ll just keep buying back stock as much as we can. Thank you, everyone. I appreciate it. I appreciate your support, and I look forward to our next call coming soon.

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