Direct Digital Holdings, Inc.

Consolidated revenue in Q2 2026 was $7.8 million versus $10.1 million in Q2 2025. Gross profit was $2.7 million, or 34% of revenue, compared with $3.6 million, or 35% a year ago. Operating expenses were $5.6 million, down 7% from $6.0 million; operating loss was $2.9 million versus $2.4 million; net loss was $3.6 million versus $4.2 million; and adjusted EBITDA loss was $2.3 million versus $1.5 million. For the first half, revenue was $14.5 million versus $18.3 million last year, and excluding $4.5 million of lower DSP sales, revenue grew about $700,000, or 5% year over year. The company ended the quarter with $500,000 of cash and cash equivalents and $3.2 million of cash plus accounts receivable. It was not in compliance with certain financial covenants under its credit facility and has requested a waiver; no formal forward revenue or earnings guidance was provided.

Mark Walker framed the quarter as part of a broader strategy reset, saying the company has streamlined operations to focus on areas where it can create the most value. He emphasized that new AI search and GEO offerings, along with AI support and web infrastructure services, are attracting demand and expanding the company’s reach beyond traditional media support. His tone was cautiously optimistic: he acknowledged the business is still early in the transition, but said the foundation is stronger and the company is seeing measurable progress.

Diana Diaz walked through the decline in revenue and profitability, tying the Q2 top-line drop to a $2.5 million decrease in demand-side platform customer spending. She highlighted that gross margin held at 34%, operating expenses declined 7% to $5.6 million, and year-to-date revenue would have been up about 5% excluding $4.5 million of lower DSP sales. On the balance sheet, she said the company had $500,000 of cash and $3.2 million of cash plus receivables at quarter-end, and disclosed a covenant breach under the credit facility, noting that discussions with the lender about a waiver were constructive and ongoing.

There was no analyst Q&A; the operator noted there were no questions. The only additional management commentary was that discussions with the lender regarding a covenant waiver are ongoing and constructive, and the company is prioritizing operating performance and financial discipline. Management did not provide quantitative forward guidance during the call.