| Metric | Value ($ M) | Q1 FY26 | Q2 FY25 |
|---|---|---|---|
| Revenue | 30.20 | 18.9% | 61.3% |
| Total Income | 30.20 | 18.9% | 61.3% |
| Expenditure | 38.49 | 56.4% | 59.1% |
| PBT | -15.41 | 73.3% | 33.3% |
| Net Profit | -12.60 | 73.2% | 27.8% |
| OPM | -27.45% | 7.09pp | |
| NPM | -41.72% | 19.36pp | |
| EPS | -1.54 | 73.5% | 30.9% |
System1 Announces Q2 2026 Financial Results and Launch of New Agentic Products
06 Aug 2026 · 6 Aug, 1:43 am
Summary
System1 announced its financial results for the second quarter of 2026, reporting revenue of $30.2 million. The company achieved a GAAP Gross Profit of $24.3 million (80% margin) and an Adjusted Gross Profit of $25.5 million (85% margin). The GAAP Net Loss for the quarter was $15.3 million, while Adjusted EBITDA stood at $1.9 million. Management highlighted a pivotal quarter with a transformative agreement to cut gross debt by half and the launch of new agentic AI products. The company plans to capitalize on tailwinds in its Products business and return its Partner Network to growth mode in the second half of 2026.
Key Highlights
- 1
System1 reported revenue of $30.2 million for the second quarter of 2026.
- 2
GAAP Gross Profit for Q2 2026 was $24.3 million, with a margin of 80%.
- 3
Adjusted Gross Profit for Q2 2026 was $25.5 million, representing a margin of 85%.
- 4
The Company reported a GAAP Net Loss of $15.3 million for the second quarter of 2026.
- 5
Adjusted EBITDA for Q2 2026 was $1.9 million.
- 6
Startpage user sessions grew 31% and mobile sessions app sessions grew 63% year-over-year in Q2 2026.
- 7
System1 launched new agentic AI products including MCP servers for MapQuest and Dogpile, and the IntentStream audience data platform during the quarter.
Management Comments
Michael Blend
The second quarter was a pivotal one for System1 as we signed a transformative agreement to cut our gross debt by half, and our Products business continued to demonstrate real operating strength. We also launched several new agentic data products, including our MapQuest and Dogpile MCP servers. As we head into the second half of 2026, we are focused on capitalizing on the tailwinds and initiatives powering our Products business while returning our Partner Network to growth mode.
Tridivesh Kidambi
Our Q2 results reflect our decision in late Q1 to significantly reduce marketing activity tied to search monetization across our owned and operated properties, leading to a planned decrease in year over year revenue but also driving adjusted gross margin up to 85% as a result of the higher-quality Products business generating the majority of our revenue and gross profit. The signing and closing of the debt exchange transaction sets us up to continue to invest in our Products business for the long-term while continuing to focus on operational efficiencies in our Partner Network business and cost structure in the short-term.
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