Good morning, everyone, and welcome to the Kultura First Quarter 2026 Earnings Call. All material contained in the webcast is the sole property and copyright of Kultura with all rights reserved. For opening remarks and introductions, I now turn the call over to Erica Mannion at Sapphire Investor Relations. Please go ahead, Erica.

Thank you, Operator, and good afternoon. I am joined by Ron Yucatow, Kaltura's Co-Founder, Chairman, President, and Chief Executive Officer, and Leron Sharon, Executive Vice President of FP&A and Interim Principal Financial Officer. Ron will begin with a summary of the results for the first quarter ended March 31, 2026, and provide a business update. Leron will then review the financial results for the first quarter of 2026 in greater detail, followed by the company's outlook for the second quarter and full year 2026. We will then open the call for questions. Please note that this call will include forward-looking statements within the meaning of the federal securities laws, including but not limited to statements regarding Kaltura's expected future financial results, management's expectations and plans for the business, including execution on our strategic transition and upcoming product launches, integration, and expected benefits of our recent acquisitions, trends in customer engagement, anticipated headwinds, and our expectations around capabilities and benefits of our products, including AI technologies. These statements are neither promises nor guarantees and involve risks and uncertainties that may cause actual results to differ materially from those discussed here. Important factors that could cause actual results to differ from forward-looking statements can be found in the risk factors section of Kaltura's annual report on Form 10-K for the fiscal year ended December 31, 2025, and other SEC filings. Any forward-looking statements made during this conference call, including responses to your questions, are based on current expectations as of today, and Kaltura assumes no obligation to update or revise them, whether as a result of new developments or otherwise, except as required by law. Please note, we will be discussing non-GAAP financial measures, adjusted EBITDA, adjusted EBITDA margin, and non-GAAP gross margin during this call. For reconciliation of these measures to the most directly comparable GAAP metric, please refer to our earnings release, which is available on our website at www.investors.caltura.com. Now, I'd like to turn the call over to Ron.

Thank you, Erica, and thanks, everyone, for joining us today. We delivered a strong start to 2026, exceeding the high end of our guidance across revenue and adjusted EBITDA and generating, for the first time in our history, positive cash flow from operations in a first quarter. Total revenue was $44.6 million, down 5% year-over-year. Subscription revenue was $43.2 million, down 4% year-over-year. Adjusted EBITDA was $5.7 million, up 37% year-over-year, and our highest first quarter result to date. These results reflect continued operating discipline, improving retention trends, and steady progress as we execute on our strategic transition. New subscription bookings in the first quarter followed our typical seasonal pattern with encouraging deal quality across both new logos and expansions. We closed one seven-digit deal, 14 six-digit deals, and three new AI-related deals. New logos included a global content delivery network, a leading healthcare system, two U.S. universities, and a major APAC broadcaster. As in prior quarters, the majority of bookings came from expansions within our existing enterprise customer base across technology, financial services, healthcare, education, and media. Gross retention improved to its highest level in the last five quarters. Net dollar retention continued to reflect the lagging impact of elevated media and telecom churn in 2025, which we expect to improve over the course of this year. During the quarter, we continued to expand our AI capabilities across both content creation and user engagement. We announced the general availability of our conversational avatar technology, along with developer tools that enable integration into enterprise workflows. We also launched a beta version and last week moved to general availability of our avatar video production studio, which enables automated creation of avatar-based video content from text and other materials. These capabilities build on our existing AI tools, such as Content Lab and Genie, extending them into more interactive and conversational use cases. Importantly, we also achieved ISO IEC 42001 certification for artificial intelligence management systems during this quarter, reinforcing our commitment to responsible enterprise-grade AI deployment. We also completed the acquisition of PassFactory on April 1st, following the signing of the definitive agreement during the first quarter. PassFactory adds content intelligence and journey orchestration built to enable enterprises to better understand user intent and dynamically deliver personalized digital experiences. Since closing, we have moved quickly to integrate teams into line product and go-to-market efforts. We're already jointly presenting our combined platform in the market and seeing encouraging early engagements. With a combination of Cultura, eSelf, and PathFactory, we believe we now have the core building blocks to evolve from a video platform into an AI-powered, rich, agentic digital experience platform. Altura provides enterprise-grade video experiences and rich media infrastructure. eSelf adds multi-model conversational avatar technology for agentic real-time and on-demand interactions. And PathFactory adds content intelligence and journey orchestration. Together, these capabilities are designed to allow enterprises to move from static, one-size-fits-all digital experiences toward more personalized, interactive, and outcome-driven journeys. Now, I will spend some time discussing how customers are engaging with us across the four journeys we power. Customers, employees, learners, and audiences. This is where we are seeing the most meaningful early validation of our strategy. First, customer journeys. Customer-facing use cases are the most advanced and show the strongest early traction. We are seeing growing interest in our revenue engagement suite, which brings together video, AI-powered content creation, conversational avatars, and journey orchestration into a unified solution for marketing, sales, and customer engagement teams. Discussions with both new and existing customers are shifting from deploying video tools to broader conversations around improving lead conversion, scaling personalized engagement, and augmenting sales and customer success teams. We are in proof-of-concept discussions with large enterprises, including Fortune 500 organizations, across technology, financial services, healthcare, and media and telecom. These include use cases such as personalized content journeys and microsites, AI-powered conversational interfaces across websites and events, automated creation and scaling of targeted video content, 24-7 digital agents supporting customer and partner engagement and onboarding, and AI-powered SDR agents. In several of these engagements, we are progressing from initial proof of concept to broader platform discussions, reflecting growing confidence in the combined value of our offerings. Importantly, these conversations increasingly involve multiple business stakeholders, including marketing, sales, and customer success leaders, expanding our buyer base beyond IT. Second, employee journeys. Across employee-facing use cases, we're seeing strong interest in leveraging AI to improve productivity, training, and knowledge access. Customers are engaging with us around four primary themes. Extending workforce capacity through AI-assisted interactions. Accelerating content creation and internal communications. Turning large content libraries into interactive knowledge bases.

and enhancing training through more personalized and interactive experiences.

We're seeing adoption of tools such as Content Lab and Genie expand within large enterprises, including global financial institutions, pharmaceutical companies, and professional services firms. These deployments are creating a strong foundation for future expansion into more advanced conversational and avatar-based use cases. For example, a large global professional services firm is expanding its use of our AI tools to scale internal communications and knowledge access across hundreds of thousands of employees, while a major financial institution has begun transforming support content into interactive, self-serve learning experiences using our Gini platform. We also seek growing interest in our avatar-based offerings for content creation, knowledge discovery, and role-play simulations for sales training, enablement, and field support. Third, learner journeys. In education, discussions are increasingly centered around how AI can enable more personalized and interactive learning experiences. Use cases include AI-powered teaching assistants and tutors, personalized learning paths, automated content creation and adaptation, and improved accessibility. We're engaged in discussions with universities around using our avatar video production studio to generate rich instructional content. We're also in discussions with institutions regarding the use of our agentic avatars as academic tutors, role-play simulation tools, and support agents for administration and admissions. Our modular architecture and integrations with learning systems position us well in these conversations, and we're seeing continued engagement from both existing institutions and new prospects. Fourth, audience journeys. In media and telecom, we're discussing how AI can enhance audience engagement and monetization. These discussions include more advanced content discovery and recommendations, personalized viewing experiences, new monetization models, and the introduction of interactive and conversational interfaces. These discussions range from AI-powered content recommendation and avatar concierge experiences to broader applications such as digital signage and customer engagement in large venues. It is worth noting we're also seeing growing interest for media and telecom companies to leverage our platform beyond traditional entertainment use cases, including customer journeys such as marketing and customer care and employee journeys such as sales enablement. In summary, the increasing depth and breadth of these engagements reflects the progress we're making in our transition. As we evolve from powering video experiences to powering end-to-end rich agentic digital experiences, our focus in 2026 is on integrating eSelf.ai and PathFactory, packaging rich agentic solutions around clear use cases, and driving early adoption. We are seeing early signs of momentum in customer engagement and pipeline activities and continue to expect revenue contributions from our new product portfolio to begin in the second half of the year with a more meaningful impact in 2027. Before I close, I also want to highlight our upcoming Kultura Connect on the Road 2026 events. We will be hosting events in New York, San Francisco, and London this week and next, bringing together customers and partners to discuss the evolution toward more personalized AI-powered digital experiences. We are pleased to have participation from leading organizations, including AWS, Cisco, IBM, MetLife, Morgan Stanley, and Palo Alto Networks. These events provide an important opportunity for customers and prospects to engage directly with our platform and roadmap, and we view the strong participation as further validation of the relevance of our strategy. Early feedback and participation levels are exceeding our expectations with strong engagement from both existing customers and new prospects. You're invited to register for in-person or virtual participation through our website. To summarize, we delivered a strong Q1, exceeding expectations across revenue and adjusted EBITDA, and achieving a key milestone with positive first-quarter operating cash flow. We launched new products based on the eSelf acquisition and completed the past factory acquisition and are progressing well on integration. We've been expanding our platform capabilities and seeing encouraging early validation across all four journeys we support and are headed into the rest of the year with increased confidence reflected in our updated guidance. With that, I'll turn it over to Liron.

you won't thanks ron and hello to everyone on the call today as ron noted in the first quarter we once again exceeded the high end of our guidance across all metrics subscription revenue total revenue and adjusted dividend and generated for the first time cash flow from operation in the first quarter of the year let me now walk through the quarter in more detail total revenue for the quarter ended march 31 2026 was 44.6 million down two percent sequentially and five percent year over year and exceeding the high end of our guidance range of 42.6 million to 43.4 million Subscription revenue was $43.2 million, up 1% sequentially and down 4% year-over-year, and also exceeding the high end of our guidance range of $41.2 million to $42 million. As discussed during our last earnings call, this year-over-year decline was fueled by the elevated media and telecom churn experience in 2025 which we forecast will improve this year as well as by a large e and t customer that shifted from conducting large virtual events to many smaller ones that are planned to be conducted later in the year professional services revenue was 1.4 million, down 50% sequentially and 31% year-over-year, consistent with our increased multi-year focus on recurring subscription revenue. On a segment basis, E&T total revenue was 34.2 million, down 1% year-over-year, and subscription revenue was $33.7 million, plus year-over-year, while professional services revenue contributed $0.5 million, down 42% year-over-year. Within M&T, total revenue was $10.5 million, down 17% year-over-year, and subscription revenue was $9.5 million, down 16% year-over-year, while professional services revenue contributed $1 million, down 24% year-over-year. Gap gross profit for the first quarter was $32.1 million, resulting in gross margin of 72% up 200 basis points from Q1 2025. Subscription gross margin was 77% in line with Q1 2025. The year-over-year improvement in gross margin reflects the continued benefit of our mixed shift toward higher margin subscription revenue. Gap operating expenses for the quarter was $33.3 million, compared to $34.3 million in the first quarter of 2025, an improvement of 3% year-over-year, and that is despite incremental operating costs associated with the ESAL acquisition and FX headwinds. adjustments. Adjusted EBITDA for the quarter was $5.7 million, an increase of $1.5 million from $4.1 million in the first quarter of 2025 and exceeding the high end of our guidance range of $2.3 million to $3.3 million. Adjusted EBITDA margin was 13%, an increase of 400 basis points year-over-year, which underscores our commitment to operational profitability also amid our strategic transition and investment in growth. GAAP net loss for the quarter was $3.8 million, or $0.03 per diluted share, compared to a net loss of $1.1 million, or $0.01 per diluted share in Q1 2025. The year-over-year change in GAAP net loss reflects primarily non-cash and non-recurring expenses, including $3.8 million for non-cash stock-based compensation and $1.9 million for acquisition costs and other strategic initiatives. Non-GAAP net profit for the quarter was $2.1 million, or one cent per diluted share, compared to $2 million, or one cent per diluted share in q1 2025 remaining performance obligations or rpo were 154.5 million flat year over year we expect to recognize 67 of this amount as revenue over the next 12 months annualized recurring revenue in the first quarter was $168.8 million, flat sequentially, and down 3% year-over-year. Net dollar retention for the quarter was 95%, compared to 107% in the prior year period, and 97% in Q4 2025. As a reminder, NDR is a lagging indicator. and reflects prior period bookings and retention dynamics. As such, it has been significantly impacted by last year heightened M&T gross churn, which we expect will materially improve this year, alongside also higher M&T and E&T bookings. Moving to the balance sheet and cash flow, We ended the quarter with $61.8 million in cash, cash equivalents, and marketable securities. Net cash generated from operating activities in the quarter was $0.7 million, compared to $1 million used in operating activities in Q1 last year. this meaningful year-over-year improvement of 1.7 million also contributed to this quarter being our first few one with positive cash flow from operation i will now turn to our outlook for the second quarter of 2026 and for the full fiscal year ending december 31 2026. for the second quarter of 2026 we expect subscription revenue to grow 2 to 4 percent year-over-year to between 43.3 million and 44.1 million total revenue to grow between two to three percent year-over-year to between $45.2 million and $46 million and adjusted EBITDA to be between $2 million and $3 million. For the full year 2026, we are thoughtfully raising all our guidance numbers and slightly narrowing the guidance ranges. We now expect subscription revenue to grow 1% to 3% to between $174.5 million and $176.7 million. total revenue to grow one to two percent to between 182.6 million and 184.8 million and adjusted EBITDA to be between 13.8 million and 15.2 million we continue to expect subscription and total revenue to pick up gradually throughout the year. We expect E&T to post a higher year-over-year growth rate compared to 2025, fueled by contributions from the past factory customer base and our new product portfolio, which is expected to start contributing revenue in the second half of the year with a stronger impact in 2027. We continue to forecast M&T year-over-year revenue decline this year due to the elevated churn in 2025, but expect to achieve both higher M&T new bookings and retention this year, which are forecasted to regenerate sequential quarterly M&T revenue growth in 2027. On the cost side, our guidance continues to take into consideration the past factory acquisition and expected post-murder integration costs, as well as the continued expected impact of ethics headwinds. To close, Q1 mocked a solid start to the year. We remain focused on disciplined execution, careful capital allocation, and balancing growth with profitability to maximize long-term shareholder value. With that, we will open the call for questions. Operator?

Ladies and gentlemen, we will now begin the question and answer session. If you would like to ask a question, please press star and 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star and 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Ladies and gentlemen, we will wait for a moment while we poll for questions. Our first question comes from Ryan Coons with Needham & Company. Please state your question.

Great, thanks. Hey, Ron, I want to ask you about some questions about kind of the expanded portfolio. Clearly very forward-leaning here and seems highly differentiated, but you kind of map us how your customer engagements are going or give us some color relative to, you know, different set of stakeholders, you know, who you've traditionally sold to, what those engagements are like, and, you know, how are you kind of positioning the new portfolio to, you know, really take a broader swath of engagement from your customers and then obviously helping your customers improve their engagements with their end customers.

Yeah, appreciate it, Ryan, and thank you all for joining today. So again, going backwards to the last couple of quarters and discussions we've had about our move from powering video experiences to powering agentic, rich experiences that cover the entire journey of customers, of employees, of learners, and of audiences. So I'll give you examples of each one of them, but before that, we've been beefing our content creation, management, and experience layer with more tools on content creation, to remind you. We have our VOD-based avatar, which enables to create automatic content with avatars. and this runs on top of our content lab capabilities and some more creation tools that we've developed. On the content management, we have the PathFactory intent-based content analytics, content intelligence platform that understands users and delivers them the next piece of content in the right context for the right reason and the right time. And then on the engagement layer, we have our agentic avatars and now also the role-play simulation on top of that, plus the delivery of the traditional Gini products that we had. So it's quite a lot of new things, and they all come together into this flywheel when content is created, managed, and delivered in real time in conversational form. Let me give you examples about what's happening in each one of the four journeys examples. So we started closing initial deals again. They're small. We expect to have the more significant contribution into revenue in the second half of the year at the beginning they're more around right now customer journey POC's around sales marketing and customer support they're coming from places like traditional tech real estate hospitality consumer goods M&T's and all over the place but to look at our pipeline right now on a broader sense we have a few dozen opportunities and they're mostly around the agentic avatars together with Jeannie albeit that there's already a few around the avatar video production suite and these are about half and half between North America and Europe about half and half between upsells and new logos we have more of them on the customer side customer journey side but not too far after the employee side and then not too far after that the learner side and the smaller one is the audience so by order again customers and employees and learners then audience I will just note that audience is one part of what M&T customers do because M&T are also using us not just for TV, but in this case, also for their customer engagement and even employees. That doesn't mean that we have less on the M&T vertical, just the TV use case, that's the order. From an industry perspective, we have the most coming from tech and actually M&T as well, and like I said, across multiple areas, followed by education, followed by financial services, and then we have pharma and real estate and gaming and BPO and manufacturing and oil and gas and food. So there's quite a few verticals that are within these pipelines for the new solutions. I'll give you now examples in each one of these. So customer journeys. Folks are coming to us for marketing, website personalization, customer outreach, ABM marketeers that are creating the full personalized experiences through interaction with what we do. We have also personalized event follow-ups with quite a few that we already have done events, and now they're looking at the one-on-one following up on these events with individuals. We have a couple that are already starting to look into using us for FDRs, the full-on basic sales on the website. We got customer training, a few. They're looking to better enable their customers with information and also customer care. We have renewal enablement. And we also have folks that are working with us towards their partners, the large companies that have marketplaces for their partners and looking to have better tools for both enablement and support. But look at this breadth around customer journey. In a second, I'll talk about the rest. So far from what we've originally done by way of providing video on the website, plus portals, plus events, plus webcasts, these were mere tools, whereas now you fulfill the full task, you fulfill the full role, you're really becoming agentic. And the outcomes, the outputs that are being looked at are not just of people engaged with video, but are you increasing your pipeline? Are you accelerating conversion? Are you reducing costs? And so these are real business interior question about buyers. We've always had kind of elements of the marketing department involved. Now we have far deeper interest by C-level on the marketing side and on the revenue side and on the customer care side. Going to move towards employee journeys. We got folks looking at internal recruiting, communications, L&D and onboarding is significant, IT help desk, digital receptionist, sales enablement, quite a few. So consider using an avatar plus tools to train sales and to deliver them the right content they need in the right time and the right place right there when they need it, including snippets and documents together with Genie. And we also have folks that are looking at the field support. So imagine people out there They're trying to install stuff, and they need real-time information. Learners, we got a bunch for tutors. They're looking to provide teaching and learning on a one-on-one basis. So, again, look at what we've historically done. We had LMS integrations with video. We had some rooms for classes. Now it's about the full teaching and learning, so it's significantly more value. We're in schools looking at role play, like nursing schools and negotiation classes and places where people need to do stuff in front of an avatar. are. We've got people that are using content creation in math. Consider they have all these documents and all these long videos. They want to create automatic shorter videos from either a slide deck or a document or long videos. And we also have even folks looking at admissions assistance and community education. And lastly, on the audience side, recommendations, TV concierge, virtual assistant, and even physical events, big venues, point of sales, kiosks. So it's by far more robust type of interactions that we've had than in the past. The beauty about it is that this is not a pivot. This is not us dropping video and suddenly getting into all these areas. This is the new way to use rich media, and many of them are connected to the other products we have. So people are saying this, okay, great, we need within this new ABM the websites, and we need within this engagement of customers the events. So it's added to what we've done. So it's a long answer, but hopefully it gives you a color, Ryan.

Yeah, super interesting, Ron. Thank you.

A reminder to all participants to ask a question, please press star and one on your telephone keypad. Our next question comes from DJ Hines with Canaccord Genuity. Please state your question.

Hey, guys, this is Ryan on for DJ. Thanks for taking our questions. So you've obviously added a ton of new functionality to the platform with eSelf and now PathFactory. And I know PathFactory is obviously new, but do you anticipate any sort of sales cycle, elongation, or digestion period as the sales force gets up to speed with the new platform?

Yeah, thank you, Ryan, for that question. Not necessarily, but then again, let's remember, sales cycles have always been kind of classic large enterprise sales cycles. Historically, Meathead and Zellecom could have been a year and a half, and the classic enterprise sales cycle is not only us. If you ask Salesforce.com or whatever, I mean, they're 14 months. So not to say that this is a typical sales cycle, but I don't think that they're further elongated. I think that they're typical long sales cycles. We've already had inbounds coming for POCs and interest at the beginning of this year through interaction in 2026 that we expect and see them converting on the second half of this year. So they're not all going to be extra long, but some of them might be.

Okay, makes sense. And then if I could sneak one more in. So we saw that you opened the platform to AI coding agents recently. Could you maybe just clarify, so I guess, how often are you seeing customers trying to build these AI-led digital experiences internally or off the Kaltura platform? And I guess, are you able to monetize this third-party access?

Yeah, to be very clear, what we've enabled is the integration into Kaltura to be by way of a code that they can run and do. This is not us open sourcing our core technology, our core offering. So the avatars and the fullness of Kultura platform is definitely our code, and it's not being released. But what we generally find is that there's an interest out there to go ahead, take these tools, and insert them in a very flexible, open, transparent way into the workflows and into the agents the third parties are building. Now, we've always taken the approach of videos in an island, and also the experiences and the agents that we provide now are not in Ireland. They need to be connected into databases. They need to be connected into third-party systems. They need to be connected into enterprise workflows. And we want to enable the lowest barrier for folks to take our tools and customize them, integrate them, insert them into workflows, and have them embedded within the environments that things are happening now. And this is even more so the case the more in-depth you are connected into the actual value generation of key KPIs of the company. And so that is enabled. So what we're seeing is that folks definitely are thinking about their agents. We're not the first nor last agent that's going to be around. What we're adding is that richness in the end user experience around the agentic interface. And in order for that to work, it needs to be natively connected to the rest of the agentic logic. And yes, we're seeing an increased amount of definitely tech companies, but beyond saying, listen, we've got our own agent factory, we've got a bunch of things we do, but we definitely appreciate everything that you just talked about and how we need to turn our website into a dynamically created, generative environment, or we need to turn our training or learning for customers or employees. We just need to have these tools connected to the rest of our agentic logic, to our own RAG, to whatever LLMs we use, to whatever applications we are developing, to whatever agents we're putting in place, and that's what we've enabled.

Gotcha. Thanks, Ron. Appreciate it.

Ladies and gentlemen, this concludes the question and answer session. I would now like to hand the conference over to Ron Iacutile, the CEO, for the closing remarks.

Yeah, I appreciate that, and thank you all for joining. Again, I think we're on track. We are seeing interest in the new stuff that we have brought in, as stated. We have our event around the corner that's happening in both New York, San Francisco, and London with great attendance. We're inviting all of you to register to it online. We're also going to be at the Needham 21st Annual Technology Conference, inviting you to come meet us there. And lastly, you may have seen, as noted in our earnings PR, we've put in our quarterly investor deck presentation our conversational agentic avatar that walks you through the deck, through the presentation as an aide. You could ask it to explain to you and take you through the slides. You could ask him to address additional questions when I see him. It actually is my avatar, but we could have put any avatar out there. And I'm sure you're going to find that helpful and it's something that showcases our technology. This is one of many, many, many things that we can and will do with our new tech. So we're excited and looking forward to what's ahead. Have a beautiful day, beautiful week, and thank you for your time.

Ladies and gentlemen, the conference call of Kultura has now concluded. Thank you for your participation. You may now disconnect your lines.