Zedge Posts 3% Revenue Gain, 32% Subscription Growth and AI Six-Figure Order
ZDGE•Zedge’s Q3 revenue rose 3.0% to $8.0M, with subscription revenue up 31.9% and active subscriptions reaching 1.26M, while ARPMAU climbed 21.2% and Zedge Premium GTV increased 16.6%. GAAP net income reached $0.9M and free cash flow soared 54.9% to $1.2M; DataSeeds.AI delivered its first six-figure order.
1. Financial Performance Highlights
Zedge reported Q3 fiscal 2026 revenue of $8.0M, a 3.0% year-over-year increase, with GAAP operating income rising to $1.1M from $0.2M and GAAP net income reaching $0.9M. Free cash flow climbed 54.9% to $1.2M, underpinning a strengthened cash and cash equivalents balance of $19.7M with no debt.
2. Subscription and Marketplace Metrics
Subscription revenue surged 31.9% to $1.7M as active subscriptions grew 40.6% to 1.26M. ARPMAU increased 21.2% to $0.119 and Zedge Premium GTV rose 16.6% to $0.72, offsetting an 11.3% decline in MAU and flat advertising revenue in the core Marketplace.
3. DataSeeds.AI Milestone
The DataSeeds.AI division fulfilled its first six-figure enterprise order this quarter, demonstrating capacity to execute large-scale AI projects. Interest from new technology prospects has begun to materialize, bolstering confidence in future DataSeeds.AI revenue potential despite current lumpy billing.
4. Capital Allocation and Innovation
Zedge increased its quarterly dividend by 25% to $0.02 per share and added $2.0M to its share repurchase authorization, bringing total capacity to $2.2M. The Innovation Team launched four alpha products to date and remains on track for six fiscal-year launches, leveraging reusable infrastructure to accelerate time-to-market.
