Adcore Third Quarter Gross Margin Rose to 64 Percent, with Gross Profit of $3.7 Million, an Operating Loss Narrowed to $263,000 and Cash of $4.3 Million with No Debt
Adcore announced financial results for the three months ended September 30, 2026, on November 10 in Toronto. The company operates an AI powered Marketing Cloud and is listed in Toronto, on the OTCQX and in Frankfurt. The company wide restructuring announced on October 21 began in September and was substantially complete by October, so the third quarter reflects only a partial quarter benefit. The company's financial statements are expressed in Canadian dollars, and the figures below follow the company's release.
Revenue for the quarter was $5.77 million, compared with $7.648 million a year earlier. Gross profit was $3.678 million, up 20 percent year over year, and gross margin rose to 64 percent, up from 40 percent a year earlier and 51 percent in the second quarter, as cost of revenue fell 54 percent year over year and 41 percent quarter over quarter.
Operating loss narrowed to $263,000, down 54 percent from $570,000 in the second quarter. Adjusted EBITDA was positive at $112,000, up from $42,000 in the second quarter. Cash from operating activities was $0.9 million, compared with cash used of $1.5 million in the third quarter of 2025 and cash used of $0.4 million in the second quarter.
Cash was $4.3 million at September 30, up from approximately $4.0 million at June 30, notwithstanding restructuring costs incurred in the quarter. The company has no debt. Trade payables fell from $8.4 million at year end to $4.6 million.
On regional revenue, North America revenue was $1.3 million in the quarter, up 27 percent from $1.0 million a year earlier. For the nine months, North America revenue was $4.2 million, up 15 percent, and APAC revenue was $11.7 million, up 6 percent. Nine month gross profit was $10.5 million, up 13 percent, at a gross margin of 49 percent, up from 44 percent, with cost of revenue down 8 percent to $11 million from $12 million.
Total operating expenses decreased 7 percent to $3.9 million from the second quarter, with selling, general and administrative expenses down 6 percent and research and development down 15 percent. Chief executive officer Omri Brill said in the release that operating expenses ran at roughly $1.3 million a month in the third quarter, and that the restructuring takes that to roughly $0.9 million by year end.
Net loss for the quarter was $543,000, compared with $448,000 a year earlier, for a basic loss per share of $0.009. Total assets were $15.818 million at quarter end, compared with $21.586 million at year end, and total equity was $8.517 million.
For the fourth quarter, the company expects to return to operating profitability, targeting operating profit of approximately $500,000 to $700,000, and expects to remain profitable on an operating basis thereafter. The restructuring is anticipated to yield a more pronounced effect from the fourth quarter, with the full effect from the first quarter of 2027. The company continues its review of strategic alternatives for its AI product portfolio, Proposaly, AI Studio and Total Eclipse, including external funding, partnerships and divestiture, with no transactions agreed.
Brill said in the release that the third quarter is the first quarter where the effect of the restructuring can be seen, that gross margin went from 40 percent to 64 percent in a year, that the company generated cash from operations and ended the quarter with more cash in a quarter where it started to pay for a restructuring, and that revenue was lower by a strategic decision to focus on higher margin revenue and let lower margin business go, while gross profit rose as revenue fell.
The company hosted a webcast and conference call to discuss the results on November 10 at 10:00 a.m. Eastern time.
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Published by GSM · USA (original Chinese edition)
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