Liftoff Mobile, Inc. (LFTO) Q3 2026 Earnings Call Transcript

Welcome to the call. And thank you for standing by. Welcome to Liftoff Q3, 2026 Earnings Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 1 on It will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please have one question and one follow-up per person. If you have more questions, please re-queue. Today's conference call is being recorded. If you do not wish to be recorded, you can disconnect now. I would now like to hand the conference over to your first speaker today, Jane Katnick, Head of Investor Relations. Please go ahead.

Thank you, Operator, and good afternoon, everyone. We're delighted to welcome you to Liftoff's third quarter 2026 earnings call. Joining me today are Jeremy Bondy, Liftoff's Chief Executive Officer, and Tarek Katraya, Liftoff's President and Chief Financial Officer. Earlier this afternoon, we reported our financial results for the third quarter of 2026. Jeremy and Tarek will begin with prepared remarks covering our performance and business highlights before we open the call for your questions. To give as many participants as possible an opportunity to ask questions, we kindly ask that you limit yourself to one question and one follow-up. Today's discussion, along with our earnings release and accompanying slide presentation, include references to certain non-GAAP financial measures and key operating metrics. Definitions of and other information regarding our key performance indicators and non-GAAP financial measures, including reconciliations of our non-GAAP financial measures to the most directly comparable GAAP financial measures, are included in the appendices to the earnings release and slide presentation, which are available on our investor relations website at investors.liftoff.ai. Before we begin, I'd like to remind you that certain statements made during the call may include forward-looking statements related to our future financial and operating performance, business strategy, and growth plans. Any statements we make about the future are, by their nature, uncertain. These statements are based on currently available information and assumptions, and they are subject to a number of significant risks and uncertainties that could cause our actual results to differ from those projected in the forward-looking statements. We describe some of these uncertainties in the risk factors section of the perspective included in our most recent registration statement on Form S-1, our most recent earnings release and slide presentation, and other filings we make with the SEC from time to time. These forward-looking statements speak only as of today, and you should not place undue reliance on them. Liftoff expressly disclaims any obligation to update forward-looking statements, except as required by law. Now, I'd like to turn the call over to Jeremy.

Good afternoon, everyone. Thank you for joining our third quarter 2026 earnings call and our second call as a public company. Total revenue was $238 million in the third quarter, an increase of 32% year over year. Adjusted EBITDA was $145 million, representing a margin of 61%. Both metrics came in well above the high end of our guidance. Q3 was our 12th consecutive quarter of revenue growth. That's three years of progress, and we're confident there's a lot more in front of us. Growth came from a wide range of verticals, supported by continued improvements in our products and models. Our job is to help our customers grow more profitably. When they do, they invest more with us. Tarek will cover the financials, and I'll focus on what drove the quarter and why we believe our growth is enduring. Last quarter, I described Liftoff as an index on the entire app economy. Our Q3 results reflected that breath. Let's start with market growth. We saw strength across key app categories, including social media, entertainment, and finance. Better performance for our customers drove more investment in our platform and strengthened our flywheel. Last quarter, we noted how events like the FIFA World Cup bring high-intent users into the mobile app ecosystem. In Q3, that momentum carried well past the tournament, as advertisers kept investing to engage those users into the NFL season and beyond. Our platform is built for moments like these. We help advertisers reach engaged users, and we help publishers monetize that attention. Self-learning also played a role. Cortex, our AI-powered prediction engine, gets smarter with every customer. New customers teach it something new, and the ones already scaling with us keep sharpening it. We also continue to meet customers where they generate revenue by expanding our predictive capabilities to serve them across the app ecosystem. We help advertisers decide how much to invest when acquiring new users. That requires understanding how their app makes money and when that revenue shows up. Our path is to support more business models and longer time horizons so customers can make acquisition decisions based on a more complete picture of user value. Cortex learns from the data our customers share with us and from our own activity on the platform. The more signal it has, the more accurate it gets. For example, during the quarter, we enhanced our model's ability to predict the value of users who generate revenue by watching ads inside of mobile apps. Many apps earn a meaningful share of their revenue through ads, so this sharpens how we optimize acquisition across modernization models. We also updated our data training architecture, allowing Cortex to learn from significantly more data than before. This is intended to expand the opportunity for future improvements. The initial results are encouraging, and we're excited about what we can build from this foundation. These upgrades are early steps towards the larger opportunity we see. Helping customers across the app economy grow more profitably by making acquisition decisions that reflect the economics of their business. We expect these improvements to drive future growth, and there's much more ahead. Our pipeline of experiments is expanding rapidly. Our advertisers span the entire app ecosystem with different modernization models, payback Back periods and growth cycles. Cortex adapts to each, finding the users and moments of attention most likely to drive measurable results. More than half of our advertiser revenue during the quarter continue to come from advertisers outside of gaming, which gives Cortex a wider view of the consumer and enables us to identify ROI-positive users across the app economy. Someone who spends money in a game is also a potential high-value customer for a retailer, a social media app, or a streaming service. Those advertisers can compete to reach that same person, giving publishers more ways to generate revenue from the audience they already have. In a past study, we observed approximately 30% better gaming prediction accuracy from adding non-gaming purchase data. What we learn in one category makes us more precise than others. Our breath makes us an attention index. Wherever people spend time in apps, advertisers follow, and we're there to help them reach those users. Growth in Q3 came from a variety of categories and customers, and each one we add keeps the flywheel spinning, so we're positioned to capture growth wherever it emerges. As I said last quarter, this market is not a zero-sum game. When advertisers hit their goals, they invest more. According to a 2025 study we commissioned, 87% of advertisers have indicated a willingness to scale spend with a partner that is exceeding their KPIs. The total addressable market isn't fixed. It's large today, and it expands as our customers hit their goals and put more investment behind us. The market also has an undeniably long runway, with room for multiple-scaled, high-growth players. The gross serviceable, addressable market for independent ad tech platforms is estimated to expand to approximately $136 billion by 2030, and is vastly under-monetized relative to other channels. Generating only about $0.07 per user hour, compared with about $0.38 for traditional TV, a nearly 6x gap. AI is at the core of how we run our business. Cortex decides which ad to show, to whom, and at what price, making approximately 1 billion predictions every second. Across the industry, AI is lowering the barrier to building an app. In the first half of this year alone, new apps released in the Apple App Store doubled versus the prior year to roughly 560,000. The result is a renaissance in app creation with more innovation, more apps, and more categories, and we believe it's just beginning. Every new app is another business competing for attention, and every one of them needs to find new users. For liftoff, that means more demand for user acquisition. Thank you. AI is also changing where search and discovery starts, and answering more questions without sending people to a website. That gives businesses more reason to invest in their own apps and build direct relationships with customers. We're confident that it makes the app ecosystem and Liftoff more durable in an AI world. As technology streamlines essential tasks, we're focused on where people choose to spend the discretionary time they get back. We believe that time will increasingly go to the things people want to do, playing games, watching the creator, following live sports, or connecting with friends on social apps. In each of these, the value comes from the experience itself. AI can draft your email. The game, the match, and the conversation are still yours. That's where our business lives. We go where people spend their time. And we're built around the ad experiences inside these apps—rewarded video in a game, a native placement in a social feed, an ad break in a stream—we believe the future of the app economy will feature many more of these experiences. We help people find them, and we help the businesses behind them grow. As we move through the fourth quarter, we expect continued contributions from product improvements deployed in Q3, with demand building across the app economy, from sports to holiday commerce. Longer term, our focus is simple. Earn more of our customers' trust. Help people discover the next generation of app experiences and keep raising the bar. We see an opportunity to build a much larger business with a clear path to continued compounding growth and margin expansion. In my fifth year as CEO, I've never been more confident in the opportunity ahead. We're just getting started, and I'm excited about how much more we can accomplish together. With that, I'll hand it over to Tarek.

Thank you, Jeremy, and good afternoon, everyone. Today, I'll walk through our third-quarter financial results and share more detail on our outlook for the fourth quarter and full year. As a reminder, we help advertisers acquire ROI-positive users. Better advertising performance gives our customers a reason to increase their spend with us. Our strong third-quarter results are a clear demonstration of this dynamic at work. Revenue for the third quarter was $238 million, an increase of 32% year-over-year and 8% quarter-over-quarter. Core advertising revenue, which now comprises substantially all of total revenue, increased 33% year-over-year. Revenue exceeded the high end of guidance by $16 million. This was driven by broad-based outperformance across several verticals, combined with the Cortex breakthroughs Jeremy described and strong execution by our team. Growth from existing customers comprised 55% of year-over-year core advertising revenue growth. At the same time, new customers acquired over the 12 months ended September 30, 2026, contributed 45%. As Jeremy mentioned, newer customers that scaled their spending around the World Cup continue to spend with us beyond that event. This is consistent with our strategy of leveraging major events to deepen customer relationships that can continue to expand over time. For the 12 months ended September 30, 2026, we had 396 customers, each contributing over $100,000 of core advertising revenue, compared to 362 in the prior year period. This reflects continued growth in the number of customers spending at scale on our platform. Turning now to profitability. Adjusted EBITDA was $145 million, an increase of 45% versus the prior year. Adjusted EBITDA margin was 61%, an expansion of about a percentage point versus Q2, and five percentage points versus Q3 of last year. Margin expansion was largely driven by operating leverage, as our revenue scaled efficiently against our cost base. This included lower infrastructure costs as a percentage of revenue, driven by our machine learning investments generating revenue growth that outpaced the added cost. Adjusted EBITDA exceeded the high end of guidance by $17 million, and margin outperformed by three percentage points versus the high end of guidance. This reflects the high flow-through of the incremental top-line growth we saw in the quarter relative to our expectations. Net income in the third quarter was $87 million, resulting in diluted earnings per share of $0.47. These strong financial results demonstrate the earnings power of our business as we build our track record as a public company. We continue to generate significant free cash flow with $93 million in the third quarter, compared with $28 million in the prior year. Trailing 12-month free cash flow was $249 million, compared with $97 million in the corresponding prior year period. As a reminder, our business is capital-like, with CAPEX of $14 million in the quarter, or approximately 6% of revenue. Our business model is designed to enable us to continue investing in R&D and the infrastructure needed to support growth while still driving high free cash flow generation. We ended the quarter with $386 million of cash and $1.4 billion of total debt. Net leverage ratio at quarter end was 2.1 times net debt to trailing 12-month adjusted EBITDA. This compares to 2.4 times at the end of Q2, reflecting increases in cash and growth in adjusted EBITDA. We expect to naturally deliver over time as the company continues to grow and produce excess free cash flow. This will strengthen our balance sheet and create flexibility to support future growth. We ended the third quarter with 169 million common shares outstanding. Weighted, average, basic, and diluted shares for the quarter were $169 million and $183 million, respectively. Moving now to our outlook for the fourth quarter. For Q4 revenue, we are raising what was implied in our previous full-year guidance to an updated guidance range of $244 million to $249 million, which would represent year-over-year growth of approximately 26% to 28%. Consistent with last quarter, our outlook reflects market growth, Cortex's ongoing learning, and the expected benefits of improvements already deployed. We do not assume additional gains from future discrete model advances whose timing or impact we cannot yet reliably forecast. We expect Q4 adjusted EBITDA of $150 million to $154 million, representing an adjusted EBITDA margin of approximately 61% to 62%. This translates into full-year 2026 expectations of revenue of $907 million to $912 million, representing growth of approximately 32 percent to 33 percent. This corresponds to adjusted EBITDA of $547 million to $551 million, representing an adjusted EBITDA margin of approximately 60 percent. As Jeremy noted, we believe that we have a long runway for continued strong, compounding growth, and expanding margins. Final housekeeping note. Beginning with our first quarter 2027 results, we plan to discontinue our reporting of core advertising revenue. Revenue outside our core advertising platforms is now de minimis, and total gap revenue provides a clear view of the business's performance. This change will simplify our reporting. We will continue reporting our customer metrics calculated using total GAAP revenue once this change takes place. In closing, our focus remains on delivering better outcomes for customers and translating that performance into durable and profitable growth and strong cash generation. Thank you for joining us today. With that, we're ready to take your questions.

Thank you, management. As a reminder, to ask a question, please press star 1 1 on your telephone and wait for your name to be announced. Please have one question and one follow-up per person. If you wish to ask for more questions, please re-queue. To withdraw your question, please press star 1 1 again. Please stand by as we compile the Q&A roster. First question comes from the line of Eric Sheridan from Goldman Sachs. Please go ahead.

Thanks so much for taking the question and for all the detail and the prepared remarks in the presentation. I want to come back to slide eight, where you talked about the advertising willingness to spend and also the monetization gap relative to other platforms. When you think about your key strategic priorities and the building blocks of the business beyond just Q4 but over a more medium to long term, talk to us a little bit about the opportunity set you see evolving and how you plan on closing the gap on that opportunity set aligned against your priorities. I'll just leave it there. Thanks so much.

Thanks for the questions, Eric, and a very broad topic as we think about the market that's in front of us. We really see ourselves as an index on the app economy, and so the opportunity that we are approaching is that of the entire set of mobile experiences across the app ecosystem. Page eight that you referenced details what we see happening with the TAM in the coming years. And the fact is, is that the market is drastically under monetized at seven cents per user hour relative to television, which we point out is monetizing at six times the density. We see growth that's coming from not only the gaming category, which has driven growth from the early days of the mobile app ecosystem, But the non-gaming categories that we are so deeply positioned to help grow across the ecosystem in the coming years, and as you know, the majority of our demand generated from beyond gaming, we see this TAM being quite vast and the days being very, very early. As it relates to our path, we just completed our 12th consecutive quarter of growth with our Q4 guide. We're forecasting growth in the mid-30s percent year over year, which rhymes with the growth that we delivered last year as well. And, um, in our second... Public quarter showing positive EPS, so the pattern that we're delivering is one that we're excited about, and the opportunity ahead of us is one that is vast and we think we're well-positioned to capitalize on.

Great.

Thank you.

Thank you. Just a moment for our next question, please. Next, we have Sratia Karadjia from Wolf Research. Please go ahead.

Hi, this is Ken Hoffa Shweta. Thank you for taking my question. For my first question, what are the puts and takes to EBITDA margin expansion in 2027?

So, our business is very prone to having good operating leverage, and you can see that versus the prior year and the prior quarter numbers, and that operating leverage really reflects that the revenue growth is outpacing our cost base, and infrastructure costs continue to decline as a percentage of revenue. There's really no structural reason that that dynamic will change. We are very optimistic that we can continue to expand margins as we grow the top line. And so I think 2027 That would be something that we would expect to continue. I'd also point out that if you look at our FY26 guidance, it reflects 5 percentage point margin increase versus 2025. So that's a good example of the track record that we have on that margin expansion.

I'll just add a couple things. While we're not providing 2027 guidance today, that said, I think that there's a couple things to call out in addition to what Tarek just shared. Very, very confident in the business heading into 2027. We have a pipeline of experiments that's growing quite rapidly, and that lends itself to this margin expansion that Tariq was referencing. We've demonstrated that we can invest in Cortex, expand those margins, and generate more cash at the same time, and that's what we plan to keep doing, really. Confident in the platform, the team, and the customer relationships, as well as the financial capacity as we think about really approaching becoming a much larger business.

Thank you both. That's it for me.

Thank you. Next question comes from James Henney from Jefferies. Your line is now open.

Great. Thank you, guys. Is there anything you can say more broadly about the seasonality of your business going into the fourth quarter? I know model improvements typically are the driver of that sequential growth, but anything that we should just be mindful of regarding typical seasonality Q3 into Q4? I know you have a mix of different advertising clients, so just trying to understand the puts and takes behind the strength you see in Q4 versus Q3. Thank you.

Yeah, thanks for the question, James. We do see seasonal moments, but innovation, growth across the app economy, and the constant shifting of consumer tastes usually tell us more about the performance of the business. And so the seasonal pattern in any one vertical, it usually isn't a great way to look at the next quarter or the quarter ahead. When I think about... Q3, we obviously had the close of the World Cup. We had the NFL season kickoff. We had back to school. But you have many seasonal moments that exist in Q4, as we all know, with the holiday season, more NFL, a variety of verticals that are activated around the live events. And so, having this business activated across the app economy, wherever attention is accruing, it's a durable business that historically has not really followed a particularly discernible seasonal pattern. What we'll continue to focus on is the product innovation and capturing the growth alongside the app economy, and the calendar will play out alongside our development and innovation. We've grown in each of the last 12 quarters, which is three trips around the sun, and we grow because Cortex continues to improve and the app economy is expanding, and those two things happen in every season.

Great.

Thank you, guys.

Thank you. Just a moment for our next question, please. Next, we have Matt Swanson from RBC. Your line is now open.

Great. Thank you. Congratulations on the quarter, guys. Looking at the change in the data architecture that you mentioned, you mentioned being able to learn more from your data. Could you just comment a little bit more on, is this help in terms of the volume of data ingestion or just better utilization of existing data assets? And then just for context from our side, just how often something like this happens, how unique this is. That'd just be a really great color.

Thanks for the question, Matt, and for the kind words. We really see ourself as an attention index, as you know, and for the entire app economy. And so the goal with the predictive capabilities is to meet customers where they're generating revenue. And these capabilities, they're going to take the form of discrete improvements in how well the model predicts and optimizes ad performance, which results in these lasting performance gains that we talk about. And they sit on top of the automated learning. So there's two examples that I gave of recent improvements. And first, I'll talk through a little bit more detail now. The first one, during the quarter, we enhanced our model's ability to predict the value of users who generate revenue by watching ads inside apps. And there are a lot of apps out there that earn a meaningful share of their revenue through ads. And so this capability improves how we optimize acquisition for customers whose users are generating revenue through differing monetization methods. We also changed how Cortex remembers. Cortex is now learning from a longer history of user behavior, and it still gives the most weight to what it saw. This week. And so this is really important because it can, it can now tell an enduring pattern from a real shift in behavior. So for customers, when behavior shifts, their campaigns are now adjusting much more quickly. And our model is continuing to keep. What it knows about the users that's valuable. So, I would think about it as weighting information longitudinally with recency. Now, this is helping our predictions get more and more accurate. The great thing is that all the improvements I just referenced, they keep working for us well past the quarter that they shift in, and the pipeline of experiments behind them will continue to expand.

I appreciate that. And if I can ask one more, you mentioned in the prepared remarks about customers reacting to kind of changing where search and discovery starts, and that makes a lot of sense to me about people kind of trying to upstream the search process. When you think about how this is creating demand for an area with great attention and viewability like mobile in-app, can you just talk a little bit about those changing dynamics and how that kind of aligns, I guess, with your traditional customer base?

So, this is a really exciting topic, Matt. The way we see it, AI is truly accelerating the app economy, and there are a variety of angles, but it's already showing up in the data. You start with what AI is doing to app creation. There are more apps than ever before, objectively. AI is making it easier to build an app. New releases on the App Store reached. About 560,000 in the first half of 2026. I believe that's approximately double the year before. So the empirical trend that you see is fragmentation. You have more apps, more choice, more competition for attention, and every one of those apps needs to be discovered and needs to grow. At the same time, as you mentioned, as we think about discovery, AI is making the app more important to businesses because it's changing where search and discovery starts. So businesses are investing more in their own experience. Inside the app, they own that customer relationship. They own the data, the repeat visit, and the transaction. There are a long list of consumer companies that we've heard report in the last few weeks, like DoorDash, eBay, Spotify, Walmart. They've said some version of this very recently, and it's becoming more and more prominent, that bringing users to your experience is an important direction and initiative. And then there's the consumer who comes to apps for the experience. The categories that we serve are about connection and entertainment, largely. The game, the match, and the conversation, that's the product itself. Agents can take away the surrounding work and help people find those experiences. People still show up for the experience itself. And the vast majority of our business is built around these specific experiences. And for us, it's really, really exciting that AI is bringing this tailwind to monetization in the form of more experiences and from user acquisition as businesses enhance their focus on bringing users into their environment.

Thank you.

Thank you. Just a moment for our next question, please. Next, we have Alex Brondelow from Wells Fargo Securities. Your line is now open.

Hi, this is Drew Daniels on for Alex. Thanks for taking the question. We observed a meaningful increase in the penetration rate of Google AI overviews during the third quarter, which seems to have driven a degradation of desktop and mobile web traffic. Do you think that contributed to the strong results that you and your mobile ad network peers reported in the quarter? Thanks.

Thanks for the question, Alec. As I was just mentioning, discussing Matt's second question, there definitely is a shift in the funnel, and we've heard that in recent earnings reports. We certainly are beneficiaries as a category of the increased focus on user acquisition through the app environment, and businesses are becoming more and more attuned to the fact that this funnel through Google has changed. Now, I expect there to be more and more disruption to the funnel and for that value to accrue to the app ecosystem because of the fact that the consumer application is an environment where the business itself can own the journey. And we're here to help businesses acquire those users that are the right fit for that given product, whether it be across the sports experience, the e-commerce experience, especially with the holiday season coming. It's certainly a top-of-mind set of verticals. It could be travel or finance. We're certainly seeing that trend. And it's quite prominent, and I expect it to be ubiquitous.

Thank you.

Just a moment for our next question. Next, we have Benjamin Black from Deutsche Bank. Your line is now open.

Great. Thank you for taking my question. Jeremy, last quarter, I think you mentioned that Cortex. Sort of compress the time for a campaign to reach optimal performance for about a day. So if you pair that with Gen.AI lowering creative friction, is that in any way changing the profile of advertiser able to scale on your platform? And does that even make you think a little bit differently about sort of the longer-term addressable market?

Great question, Ben. The benefits of moving from linear regression to neural nets, which we really capture in the transition to Cortex, which was available in the market as of Q4 of 2023, was quite transformational for the business. As you called out, to- Compress the time for exploration from multiple weeks on average to a day, as you say, is a transformational benefit that is accruing to a business like ours. Now, from that point, as you call out, there's building the model and the intelligence of the model once we are on this neural net paradigm. And the benefits that can accrue to us from building within Cortex are quite meaningful as well, and we've called out some of those recent releases. What I would think about is the ability to learn with less information, simultaneously the ability to compress more information, and Getting more intelligent over time, discerning and weighing recency versus the totality of the data that we take in. And one of the benefits of our releases from this past quarter was around exactly that, the intelligence of our model in weighing the entirety of the data that we've captured on a given advertiser for practicality and the novelty of the data that comes in in a given day. You certainly could continue to optimize from 24 hours to less. However, the real... Key to unlocking much more growth in this industry and this multi-year catch-up that we talk about that we're so excited about is continuing to get more precision in terms of what are the types of qualities of users that are accretive to a given app. And so we're going to continue to build out Cortex so that the capabilities are increasing their accuracy over time. Certainly one of the vectors will be, can we learn faster? But if we think big, it's about continuing to get smarter across the broader swath of data and opportunity in front of us.

Thank you very much.

Thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. Just a moment for our next question, please. Next, we have Matt Cost from Morgan Stanley. Your line is now open.

Hi, everybody. Thanks for taking the question. If we look across the space at some of your peers publicly traded, they have in the past year or so had some really, you know, huge step ups in the performance of their ad models. And obviously, we're seeing sort of regular way material improvement in Cortex, which showed up to, you know, in results for this quarter. But when we think about what the next couple of years of development for Cortex are going to bring, should we expect, you know, Axon 3.0 or vector-style major steps up in the improvement of Cortex? And, yeah, how should we think through the pace of those improvements over time? Thank you.

Good to hear from you, Matt. In Q3, we grew 32% year-over-year, and we more than tripled free cash flow against the same period last year while continuing to invest in Cortex. It was our 12th consecutive quarter of growth, and our ambition as a business is to grow the longest. And so we've built Liftoff to pursue the opportunity across that whole app economy. As I've mentioned in my prepared remarks, more than half of our advertiser demand already comes from outside of gaming. Our peers have delivered strong quarters, and product cycles and customer mixes differ across the businesses. It is very encouraging that all of us are growing at such a rapid rate. It is clearly not a zero-sum game, and there clearly is room for multiple-scale players. We see a ton of room to improve customer returns across many verticals and build a much larger business. When I think about where we are with Cortex, we are three years in. Our full-year guidance, now that we've guided to Q4, is for another year of more than 30% growth in 2026, with margins about five points wider. And the pipeline of experiments behind this year's improvements keeps expanding. We are very, very excited about the long term for Cortex, and this quarter's architecture change gives us room to train on much more data, and we see many years of horizon, both for the market and for Cortex, ahead of us, and that's what really informs our confidence, and we're going to to continue to focus on really growing the longest. It's very, very early, and the first results are encouraging. But we see it as a base.

Great. Thank you.

Thank you. Next question comes from Bernie McTerran from Newham. Your line is now open.

Great. Thanks for taking the questions. Maybe it's the start. I know you're not providing 27 guidance at this time, but is there anything we should be thinking about for next year in terms of year-over-year comparisons like the World Cup that might be an issue, or do you have confidence that, given the growth, we won't be talking about those next year? And then second, Jeremy, earlier in the call you discussed companies wanting to bring people to their own apps. Are you seeing any changes in spending patterns or thresholds of what companies are willing to spend to drive more, you know, organic traffic, especially with potential risks coming in the form of agentic shopping?

Thanks for the questions, Bernie, and I'll take a stab at both of them. In terms of the first question about 27, as I mentioned earlier, We see a tremendous amount ahead of us in 27 plus, and really the challenge is sequencing the effort to maximize the return and deliver for shareholders. But as you think about what Bartex is with the architecture step-up that we just delivered and with really broadening the types of business models that we've engaged with beyond IAP and broadening the horizons in which we're optimizing for our advertisers, there's just a tremendous amount of space for us to continue to grow this business. While we haven't delivered 2027 guidance yet, we will, and if you look at the empirical evidence and what we're guiding to in Q4 of 26, there's quite a pattern that we're delivering against, and we could not be more confident in the growth that is to come in 27 plus. Now, that being said, thinking about the seasonal calendar, really, we have exposure to every one of these experiences that we as consumers hear about across the app ecosystem and across the world of live events, from sports to broader entertainment. If you're traveling, there's a variety of verticals that we're engaged with, anything related to personal finance, social. And so when you think about where consumers' attention could go, frankly, it could go to a place that none of us expect. But what I love about this business is that we get that front row seat to what people care about. And people are endlessly curious, and they'll fall in love with a new app this year that none of us have heard of. And we built Liftoff for exactly that, wherever people's time and attention travels. And wherever advertisers race to meet them, they'll find us there as well. Now, as we point to your second question around... Where search is going, the LLM category or the AI chat category, if you will, AI apps have the same two needs as every app business, and these two needs are what we get up for every morning. They need to find valuable users, and they need to monetize engagement. And so when you think about our platform, It wasn't built around any one category, but when attention shifts to a new kind of app, and this is a great example, the same models serve it. This is a fast-growing category, one that I'm personally very engaged with, and it's an opportunity for us on both sides of the platform, but was not yet a significant driver of the quarter for us. So it's exciting as we think about go forward, but people's attention is really always in motion and now more than ever. And so wherever it lands, whether it be with one of these LLMs or . . . At an event, as we discussed earlier, or a combination of the two, we're already there, and that's the beauty of being an index on the entire app economy.

Thank you.

Just a moment for our next question. Next, we have Clark Lampin from BTIG. Your line is now open.

Hey, guys. Hopefully you can hear me. There's been a pretty interesting discussion thus far where I think at a high level you've alluded to, you know, potential shifts in digital advertising spend away from some sort of beleaguered categories right now, maybe over towards the in-app category. And I'm curious, I guess, to the extent that that does take shape in 27 or even beyond, how do you think about... Liftoff sort of competitive differentiation relative to some of the other sort of potential destinations for that spend. I think there are, you know, high level or sort of very simplistic ways that we think about it, but maybe a layer deeper when you think about your data, your model advantages, your development, other things like that, that it may be less obvious. Another way of saying this is, I guess, is what's liftoff's right to win or what's the sort of developing or evolving right to win? Thanks a lot.

Yeah, thanks for the questions, Clark. I think just starting with where we sit and where this market sits today, perhaps the most important point is just the vast under-modernization of the market. As I called out earlier in my prepared remarks, seven cents per user hour. We're seeing 1.4 billion users on average a day, and you have a A really rich experience in the app, largely in the phone, that is really waiting for businesses to more effectively and scalably advertise through this environment outside of the walled gardens. And so when you think about just how much needs to happen, there certainly needs to be multiple. Predictive models that are helping feed that ecosystem, and we know that we are more than qualified to be one of those drivers, and we're positioned by virtue of working across the app ecosystem, across really all of the experience that you can imagine, we're positioned to help those businesses of today and tomorrow grow their businesses through the app ecosystem. What are the ingredients of the advantages? I would think about really three things. It's a combination of cortex. It's a neural net-backed machine learning model that predicts the optimal ad for a given impression, a scaled SDK that is integrated in over 160,000 apps, and then there's years of customer relationships across the app economy, which I think is just absolutely vital in understanding how to help these businesses. So, when you look at the... The vertical diversification, which I'll point to, this liftoff was really built from the inception to serve this entire app economy, and we're seeing asymmetrical growth coming from outside of gaming, these businesses that are really starting to build their presence. And we are there. The empirical evidence through this earnings and prior is that we are there to help them build these businesses. Now, our models will continue to train on this diversified customer base across all these verticals, and that will give us a more fulsome picture into user behavior and that breadth. It has helped lend itself to our growth over the last 12 quarters since Cortex hit the market. And so to bring it together, the prediction, the distribution, and that customer knowledge, they each make the other stronger. And we spent more than a decade building all three. And we're certainly learning each and every moment, both as a business and as a model. And I think we're very well positioned to help this market grow. And one could argue that there isn't a business that's better positioned to help apps across the entire app store.

Thank you.

That's helpful. And if I could, I guess, just ask sort of a quick one in the past, Tariq. You've provided some helpful context around the portion of the business that sort of comes from new and sort of repeat, you know, customers and campaigns. And I wanted to see, could you provide, I guess, an update, you know, I guess, in lieu of that sort of detail, I guess, in the queue at present, whether that's sort of directional or hopefully, I guess, like the data points that I'm asking for or the question, I guess makes sense, but in repeat, and I guess that sort of evolution, any update you can share would be useful, I think. Thanks. Happy to help you there.

So in Q3, our existing customers generated 55% of our year-over-year core advertising revenue growth, and then new customers generated 45%. And those are new customers within the last 12 months. There's going to be some natural fluctuations from quarter to quarter, but that's pretty similar to what we had the prior quarter. And I think it's a good expectation that over time, we should see the majority of our growth come from existing customers. That should continue to be our largest source of growth. That being said, new customer acquisition remains important for all the reasons that Jeremy was talking about. It shows that we're able to meet the needs of the app economy where the attention is going, and we think that that's a healthy mix for our business. But I think very consistent with what you saw last quarter.

Appreciate it, guys. Thank you.

Thank you. Next question comes from the line of Alicia Renice from Redbush Securities. Your line is now open.

Thanks for taking my question. You had said that the Q3 Cortex update better values users who monetize through ads. As IAP-only publishers are just beginning to layer in ads, and I know we're very early on that, but has any of that begun to show up in your SSP supply or SDK footprint yet?

Great question. As a business that has a footprint of over 160,000 apps, there are plenty of apps where our SDK is integrated that are monetizing only through ads, and the innovation of our business in this past quarter was to really enhance the Advertising that Cortex is predicting and bringing to these publishers. So we have the benefits of being a vertical platform that has combined demand and supply. And Cortex's ability to predict the future value of these users who are generating revenue by watching ads allows us to bring our direct advertisers to these publishers that we've been working with for many, many years. As you called out, there are a lot of apps that are just starting to serve ads that largely monetize through in-app purchase, and now our model can piece together the economic events that are driving the value of a user from purchases to ads viewed to subscriptions, and so this gives us a more holistic ability to underwrite. As a predictive engine. So this is a very powerful tool for us to grow our business. In fact, if you think about our business, having the breadth across advertising categories, the same person could be valuable in different ways across the app economy. Someone can spend nothing in a game and still generate meaningful ad revenue while also being a valuable shopper in a retail app. And so that's a really exciting opportunity for us in the periods to come as we think about the total consumer and their interest in a game, a finance app, a travel app, a social app, you name it. We have the opportunity to help bring the right experiences to that user and help measure the efficacy of that spend through multiple economic channels. Now, for us, what will that mean? Advertisers will get more opportunities to acquire valuable customers. Publishers will get more ways to monetize the same audience, and our models will optimize for as much customer revenue overall as possible. And really, the app ecosystem has always been an economically innovative space, and apps keep inventing new ways to make money so they can keep creating great experiences, and Cortex is built to adapt as they do.

And as a quick follow-up, can you talk about the competitive space here where you are able to differentiate? I think you answered some of that already, but if you can elaborate a little. Thank you.

Sure. If you think about the mind of the customer, those who are monetizing their app or seeking to acquire users for their application, the objective… On the user acquisition side is to acquire as many users as possible that are ROI positive. And the constraint is the availability of models or businesses in our space to acquire those users at scale. So our job is to help that user acquisition manager, for example, really grow their business profitably. have built a business that can partner with that user acquisition manager across verticals, whether they work in travel or finance or social or gaming. And we have tremendous scale with our software developer kit to make the buying economically viable and more likely to be accretive. Now, if you look at those two assets alone, there are very, very few companies. That can do this in our space. If you layer in the decade plus of partnering with businesses across the app ecosystem to do exactly that, you have even fewer. And so when we think about the years to come in conjunction with some of the market framework that I laid out earlier, there is a tremendous amount of space. For us to help populate accretively for businesses in the app ecosystem, and that's what we're here to do.

Thank you.

Just a moment for our next question. Next question comes from Ralph Sendler from Barclays. Your line is now open.

Great. Yeah, just two quick questions. The first one is like going back to the Google not sending traffic out at the same flip as they once did before. I think we're all pretty aware of that issue. Is it that you're talking about the kinds of companies that are seeing, like, kind of negative pressure from SEO, and hence they're going to lift off or others for more mobile ad marketing to kind of stay above water? Or is it more like… You know, just your typical large direct response marketer that maybe has like a balanced amount of traffic, and they're just kind of holistically thinking about moving like incremental budget away from Google because it's just, you know, not as growthy of a channel in the future. So kind of like your SEO impacted group versus just the broader group. Could you kind of elaborate on that and then just have one other follow-up?

Thanks, Ross. So just to clarify the parameters of our business, our customers are apps themselves rather than those who are solving for the purchase of the SKU end-to-end. And when you think about the. Calculus of that app advertiser vis-a-vis buying in the walled gardens or buying through Google versus buying through a partner like ours that's accessing the broader app ecosystem and bringing users, customers to their app. It is absolutely not a zero-sum equation. They will spend as much as they possibly can where it's ROI positive. So what I would expect is that you would see a mixed shift within a given advertiser into the channels where you're seeing better returns. And so if the traffic efficacy is diminishing or the drop-off is more severe than it has been historically, then I would expect those same businesses to build out more features in their app to make that mousetrap stronger. Then enhance their focus on user acquisition with a channel like ours, and so I would expect this to be a longitudinal exercise that we observe as LLMs and the search funnels play out, and we certainly are the place to go if you want to be closer to your customer.

That's super helpful. And then going back to the non-gaming categories and the growth there. So I think like one of the debates that is always kind of raging in the investment community is like, is it that those end markets are growing at a certain cadence and you're kind of participating in that or that we are? Gaining share in those categories. Are there, like, relevant data points that you guys measure your share gain against others that you could point us to to help kind of express that?

Sure, Ross. So when you look at our business, I mean, share gain is really a derivative of the motion that I was just walking through. The dollars will continue to flow where they're coming back ROI positive, and budgets or shares are really derivatives of that math problem. And so when you think about the focus of our business, it's on delivering performance improvements for our customers, which then turn into what we would call increased budgets or increased relationship size. So as we talk about, Tarek talked earlier about our growth from existing customers versus new customers, there's certainly so many new experiences, as you called out, that people are really flocking to in the app ecosystem. Our job is to enhance the intelligence that we bring to that math problem, and then everything is a derivative of our ability to find those users in an ROI-positive way. And so when you think about what is the conversation with the customer, it's not about allocating from one channel to another. They want to spend as much as possible as long as they're hitting those KPIs. And our objective is to help find more of those users and truly unlock more of that profitable spend. That is the conundrum that we face every day in terms of pushing our model to get better at predicting ROI positive spend.

Thank you. Just a moment for our last question. Your last question comes from a line of Ralph Charcot from William Blair. Please go ahead.

Great. Thanks for taking the question. I know you talked about the performance improvements in Cortex again within the quarter, which is great,

but maybe if you could just help us think through the relative improvement you saw in Cortex maybe this quarter versus the last couple of quarters in a sense of how much of a driver was it of overall

growth in the quarter versus increased customer spend. Obviously, it would be a combination of both, but just any thoughts there would be great. Thank you. Thanks, Ralph. So, Q3 performance benefited from the combination of all the drivers that we've discussed before, and that's inclusive of the market growth, the self-learning of the Cortex model, and the model breakthroughs that Jeremy referenced in the prepared remarks. We did also see growth across several verticals in the quarter. Now, historically, market growth and self-learning have supported our baseline growth. We've had periodic upside from discrete model improvements, but the mix is going to vary quarter to quarter, and it's difficult to disaggregate them because they really blend together. What I can say is we're excited about the results in the quarter, and we view it as another proof point in our growth journey that we've been on and why we've been able to deliver 12 consecutive quarters of growth since launching Cortex. Great.

Thanks, Dirk. Thank you. I see there's no further questions. This concludes liftoff Q3 2026 earnings call. Thank you for participating. You may now disconnect.