LiveOne, Inc. (LVO) Q3 2026 Earnings Call Transcript

Access earnings results, analyst expectations, report, slides, earnings call, and transcript.

Overview

The earnings call highlights several positive factors: AI-driven growth strategies, substantial B2B partnerships, and strong podcast revenue. The Q&A section reveals confidence in unique B2B offerings and sustainable cost management, despite vague details on some partnerships. The company's emphasis on subscriber growth and ARPU increase, alongside debt reduction and operational efficiency, suggests a positive outlook. Although management avoided specifics on some revenue impacts, the overall sentiment is optimistic, predicting a positive stock movement of 2% to 8% over the next two weeks, assuming moderate market cap sensitivity.

Key Financial Performance

Consolidated Revenue (Q3 FY 2026) $20.3 million, with no specific year-over-year change mentioned.

Audio Division Revenue (Q3 FY 2026) $18.6 million, with adjusted EBITDA of $2.6 million. No specific year-over-year change mentioned.

Consolidated Adjusted EBITDA (Q3 FY 2026) Positive $1.6 million, with no specific year-over-year change mentioned.

Consolidated Net Loss (Q3 FY 2026) $4.1 million or $0.37 per diluted share. No specific year-over-year change mentioned.

PodcastOne Revenue (Q3 FY 2026) $15.9 million, with adjusted EBITDA of $2.8 million. Record growth was noted, but no specific year-over-year change mentioned.

Slacker Revenue (Q3 FY 2026) $2.8 million, with adjusted EBITDA of negative $0.1 million. No specific year-over-year change mentioned.

9-Month Consolidated Revenue (FY 2026) Over $58 million, including $20 million in Q3. No specific year-over-year change mentioned.

9-Month Audio Division Revenue (FY 2026) $52.2 million, with adjusted EBITDA of $3.7 million. No specific year-over-year change mentioned.

Operating Expenses Reduction Reduced by over 52% year-over-year, attributed to structural changes and the use of AI.

Debt Reduction Over $2.5 million of debt paid off, contributing to improved capital flexibility.

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Operating Highlights

Original IP Expansion: Sold fourth television series to a major streaming platform with 100% margin economics. Over 15 original projects in the pipeline.

Proprietary Product Launch: Testing, launching, and scaling proprietary products directly to a community of over 65 million consumers.

B2B Partnerships: Largest B2B pipeline in company history, up 30% in 120 days, with over 100 active enterprise opportunities. Expanding partnerships with Amazon, Apple, Paramount, Tesla, and others. Launching 3 major Fortune 500 partnerships with significant subscriber bases.

Live Experiences: Reaccelerating live events, which previously represented 50% of revenues before COVID.

Cost Reduction: Reduced operating expenses by over 52% year-over-year, streamlined workforce from 350 to 88 team members using AI.

Debt Reduction: Paid off over $2.5 million in debt, strengthening balance sheet and capital flexibility.

AI Integration: Leveraging AI for staffing, behavioral data analysis, personalization, and enterprise engagement.

Leadership Restructuring: Evolving leadership structure with plans to appoint a new President to focus on operational roles, while CEO focuses on B2B partnerships, M&A, and AI initiatives.

M&A Opportunities: Sharp increase in inbound M&A opportunities as market stabilizes and valuations normalize.

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Risk or Challenges

Market Conditions: The company highlighted challenges from the collapse in media and microcap valuations, which have impacted the industry and could affect future growth opportunities.

Partnership Disruptions: The loss of key partnerships and disruption in the automotive channel were mentioned as past challenges, which could have lingering effects on operations and revenue streams.

Economic Uncertainties: The company navigated through COVID shutdowns, which had a significant impact on live events, a major revenue source. Although recovery is underway, economic uncertainties remain a potential risk.

Strategic Execution Risks: The company is undergoing leadership restructuring and scaling operations, which could pose risks if not executed effectively. Additionally, the focus on AI initiatives and B2B partnerships requires careful management to ensure alignment with strategic goals.

Supply Chain and Operational Risks: The company reduced its workforce significantly, from 350 to 88 team members, relying heavily on AI for operations. This structural change could pose risks related to operational efficiency and workforce management.

Competitive Pressures: The company faces competition from major players like Netflix and TikTok, which are expanding into the audio and podcasting space. This could impact market share and growth potential.

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Guidance & Outlook

Fiscal Year 2026 Revenue and EBITDA Guidance: The company has provided preliminary fiscal guidance for fiscal year 2026, projecting revenues of $85 million to $95 million and adjusted EBITDA of $8 million to $10 million.

Net Operating Loss Carryforwards (NOLs): LiveOne has over $125 million in net operating loss carryforwards, which are expected to provide significant long-term shareholder value and tax efficiencies as the company grows earnings.

B2B Pipeline Expansion: The B2B pipeline is the largest in company history, up over 30% in the last 120 days, with over 100 active enterprise opportunities involving companies ranging from $1 billion to $1 trillion in size.

Fortune 500 Partnerships: The company plans to launch three major partnerships with Fortune 500 companies, including a national retailer, a leading TV platform, and a major carrier. Two of these partners have over 50 million monthly paying subscribers.

Subscriber Conversion Strategy: LiveOne aims to convert over 1 million free and ad-supported subscribers, including Tesla users, into highly monetized tiers, representing meaningful incremental revenue and EBITDA.

M&A Opportunities: The company is seeing a sharp acceleration in inbound M&A opportunities as market valuations stabilize, and it is disciplined in evaluating opportunities to increase shareholder value.

Original Content Expansion: LiveOne is expanding its original intellectual property, with over 15 original projects in the pipeline, including a fourth television series sold to a major streaming platform. These projects are expected to generate high-margin revenue streams.

Live Events Growth: The live events market, which previously represented 50% of revenues, is reaccelerating, and the company plans to expand live shows across podcast, music, and live event formats.

AI Initiatives: The company is leveraging AI to enhance personalization, optimize monetization, and power enterprise engagement. AI partnerships and initiatives are expected to drive growth in B2B demand and pipeline expansion.

Leadership Evolution: LiveOne is in the process of appointing a new President with experience in scaling billion-dollar public companies. This leader will focus on day-to-day operations, allowing the CEO to concentrate on B2B partnerships, M&A, and AI initiatives.

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Shareholder Return Plan

Share Repurchase Program: The company is expanding its share repurchase program with approximately $6 million remaining under the authorization. This reflects the company's confidence in its valuation and growth trajectory. The CEO emphasized that the company is materially undervalued, trading at less than 1x revenues, and highlighted the improving industry multiples as a rationale for the buyback.

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Key Q&A

Q:Can you elaborate on the customization in the B2B business and the potential risk of music streaming companies entering the B2B space?

A:Robert Ellin explained that their B2B deals are unique due to their ability to white label, low pricing, and nimbleness. He highlighted that competitors like Spotify, Apple, and Amazon are unlikely to enter the B2B space in the same way due to their focus on maintaining their brands. He also mentioned the growth of their Amazon deal to over $20 million and another streaming partner deal to over $26 million.

Q:What is the potential for ad revenue from Slacker's ad-supported customers?

A:Robert Ellin stated that they have partnered with DAX, a leading programmatic advertising company, and have increased ARPUs by over 30%. He emphasized the importance of free subscribers as a conversion funnel to paid subscriptions, citing Spotify's claim that 60% of free subscribers eventually convert to paid subscriptions.

Q:What is the competitive landscape for providing content to brands, and are companies like Spotify offering non-white label solutions?

A:Robert Ellin noted that while there is some competition, their ability to white label and tailor services uniquely positions them in the market. He mentioned that the music business is complex, involving numerous partnerships and payouts, which makes it challenging for others to replicate their model.

Q:Can you share more information on the B2B partnership with 30 million-plus subscribers?

A:Robert Ellin confirmed that the contracts are signed and mentioned that there are multiple partners with over 50 million subscribers. He refrained from providing specific details but indicated that these partnerships are in the launch phase and expected to be publicly announced by year-end.

Q:When will the 10-Qs for LiveOne and Podcast be released?

A:Ryan Carhart stated that the 10-Qs should be released tomorrow.

Q:Are the current cost levels for G&A and sales and marketing sustainable?

A:Ryan Carhart confirmed that the current levels are sustainable and may even decrease slightly in the next quarter. He also mentioned that depreciation and amortization levels are expected to remain stable, with a slight potential increase due to new product development.

Q:What should be expected for stock-based compensation in the coming quarters?

A:Ryan Carhart indicated that stock-based compensation levels should remain similar to the current quarter, with a potential increase depending on talent equity plans.

Q:What is the timing for revenue from the 30 million subscriber B2B deal?

A:Ryan Carhart mentioned that revenue from this deal might start to show in the current quarter but is expected to ramp up in the following year. The $85 million to $95 million guidance includes minimal revenue from this deal.

Q:What is the expected growth in revenue from Tesla subscribers?

A:Robert Ellin confirmed that revenue from Tesla subscribers is expected to grow next fiscal year. He highlighted the upfront payments from year-long subscriptions as beneficial for strengthening the balance sheet.

Q:Review of Unclear Management Responses

A:Management avoided providing specific details about the B2B partnerships with 30 million-plus subscribers, including the industry of the partner and exact timing of revenue realization. They also used vague language when discussing the potential revenue impact of these deals, referring to 'nickels and dimes' and emphasizing conservative estimates without concrete figures.

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Earnings Word Cloud

The most frequently occurring keywords in this quarter's earning call

LVO Transcript

LiveOne, Inc. (LVO) Q3 2026 Earnings Call Transcript

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LiveOne, Inc. (LVO) Q2 2026 Earnings Call Transcript

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The earnings call highlights a mix of positive and negative aspects. Record-breaking PodcastOne revenue and a significant increase in ARPU are positive signs. However, the company faces challenges with negative consolidated EBITDA and net loss, and unclear guidance on B2B revenue. The buyback program is a positive factor, but the lack of specific guidance and management's vague responses in the Q&A create uncertainty. Overall, the sentiment is neutral, with no strong catalysts for significant stock price movement in either direction over the next two weeks.

LiveOne, Inc. (LVO) Q4 2025 Earnings Call Transcript

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The earnings call shows mixed signals. Financial performance is stable with revenue growth and a share buyback program, but concerns about net loss, economic uncertainties, and strategic execution risks persist. The Q&A highlights optimism in subscriber conversion and B2B partnerships, yet management's vague responses on critical issues raise uncertainty. The lack of clear guidance and the ongoing restructuring efforts further contribute to a neutral outlook for the stock price in the short term.

Earnings call transcript: LiveOne Q3 2024 misses EPS forecast, stock dips

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The earnings call highlights strong revenue growth, successful B2B partnerships, and a significant Tesla partnership, indicating potential for future growth. The stock buyback program reflects management confidence. While there are concerns about rising costs and competitive pressures, optimistic guidance and new partnerships suggest positive momentum. The Q&A section reveals some uncertainties but doesn't overshadow the positive developments. Overall, the company's strategic initiatives and financial health point towards a positive short-term stock price movement.

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