Good day, ladies and gentlemen, and welcome to the Ziff Davis Fourth Quarter and Year-End 2025 Earnings Conference Call. My name is Tom, and I will be the operator assisting you today. [Operator Instructions] On this call will be Vivek Shah, CEO of Ziff Davis; and Bret Richter, Chief Financial Officer of Ziff Davis. I will now turn the call over to Bret Richter, Chief Financial Officer of Ziff Davis. Thank you. You may begin.

Thank you. Good morning, everyone, and welcome to the Ziff Davis Investor Conference Call for Q4 and fiscal year 2025. As the operator mentioned, I am Bret Richter, Chief Financial Officer of Ziff Davis, and I am joined by our Chief Executive Officer, Vivek Shah. A presentation is available for today's call. A copy of this presentation and our earnings release is available on our website, www.ziffdavis.com. You can also access the webcast from this site. When you launch the webcast, there is a button on the viewer on the right-hand side, which will allow you to expand the slides. After completing the presentation, we'll be conducting a Q&A. The operator will provide instructions regarding the procedures for asking questions. In addition, you can e-mail questions to investor@ziffdavis.com. Before we begin our prepared remarks, allow me to read the safe harbor language. As you know, this call and the webcast will include forward-looking statements. Such statements may involve risks and uncertainties that could cause actual results to differ materially from the anticipated results. Some of those risks and uncertainties include, but are not limited to, the risk factors that we have disclosed in our SEC filings, including our 10-K filings, recent 10-Q filings, various proxy statements and 8-K filings as well as additional risks and uncertainties that we have included as part of the slide show for this webcast. We refer you to discussions in those documents regarding safe harbor language and forward-looking statements. In addition, following our business outlook slides are our supplemental materials, including reconciliation statements for non-GAAP measures to their nearest GAAP equivalent. Now let me turn the call over to Vivek for his remarks.

Thank you, Bret, and good morning, everyone. For the full year 2025, Ziff Davis grew revenues 3.5%, adjusted EBITDA grew slightly, and the company generated almost $290 million in free cash flow. Given the headwinds that some of our businesses experienced, we're glad to have produced a year of growth, however, modest. We deployed $174 million, about 60% of our free cash flow in share repurchases throughout the year as we continue to view our own stock as a highly attractive investment. In the fourth quarter, we experienced a 1.5% drop in revenues and a 5% decline in adjusted EBITDA due to an 18% decline in our Tech & Shopping segment, offset by growth of over 6% in our 4 other segments. Tech & Shopping's revenues declined largely due to a drop in web search traffic, which had a meaningful impact on our affiliate commerce revenues. As a reminder, we earn affiliate commissions when a user clicks from one of our sites to a partner merchant site and makes a purchase. The highest quality referral traffic for an affiliate commerce business comes from search engines, which are generating lower referrals for us. We believe we can contain the damage through alternative sources of engagement over time as well as growing our video advertising and licensing businesses. In fact, the CNET Group saw video and social views grow 100% in Q4 and over 80% for full year 2025 to 1 billion views. Gaming & Entertainment revenues grew 1.5% in the fourth quarter, consistent with its full year growth rate. Humble Bundle Storefront had its best revenue quarter in 5 years. Humble Bundle achieved a huge milestone in Q4, celebrating its 15-year anniversary and over $275 million raised for charity to date. IGN Entertainment social growth and engagement continued in Q4 with…

Thank you, Vivek. Let's discuss our financial results. Our earnings release reflects both our GAAP and adjusted financial results for Q4 and fiscal year 2025. My commentary will primarily relate to our Q4 2025 adjusted financial results and the comparison to prior periods. Let's turn to Slide 5 for the summary of our Q4 2025 financial results. Fourth quarter 2025 revenue was $406.7 million as compared with revenue of $412.8 million for the prior year period, a decline of 1.5%. Fourth quarter 2025 adjusted EBITDA was $163.2 million as compared with $171.8 million for the prior year period, reflecting a 5% decline. Our adjusted EBITDA margin for the quarter was 40.1%. We reported fourth quarter adjusted diluted EPS of $2.56. This figure reflects the impact of our active share repurchase program. Turning to Slide 6. Let's review our fiscal year 2025 results. Fiscal year 2025 total revenue increased 3.5% to $1,451.3 billion as compared with the prior year. Fiscal year 2025 adjusted EBITDA increased year-over-year to $495.1 million. Our adjusted EBITDA margin for fiscal year 2025 was 34.1%. Adjusted diluted EPS was $6.63, up slightly as compared with fiscal year 2024. During a number of our recent quarterly calls, we have discussed how our Games Publishing business has negatively impacted our recent financial results. This was true again in the fourth quarter of 2025 as Game Publishing contributed negative net revenue of $2.5 million. However, during the fourth quarter, we took action and sold our Game Publishing business in a transaction that allowed us to recognize a book and cash tax savings associated with the loss related to the sale of the business while maintaining the right to certain future payments tied to the performance of the assets under their new management. We did not attribute a value to these…

[Operator Instructions] And your first question this morning is coming from Rishi Jaluria from RBC.

Maybe just one for me to keep it. But Vivek, I wanted to expand a little bit on some of the AI search tailwinds that you talked about on Tech & Shopping. Maybe can you expand a little bit in terms of how that's progressed? This is obviously a trend we've been discussing for a while. Some of the investments that you can make to maybe capitalize on the AI search opportunity and take that kind of segment back to a better growth trajectory. And then if we think about AI search throughout the rest of your businesses, are there other parts that have proven to maybe be a little bit more resilient, whether it's health care or gaming or whatever? Maybe any color you could give as it pertains to that would be helpful.

Thanks, Rishi, for the question. And so yes, look, what I would say is generally speaking, a lot of traffic is fungible, meaning that lost search traffic can be and has been made up with other sources of engagement, apps, social traffic, video, programmatic traffic and e-mail. So the degree to which in any of our segments in the Gaming & Entertainment and Health & Wellness segments, in particular, we're able to offset search traffic declines. Where that has become really hard is within Tech & Shopping because the one type of traffic that really is hard to replace as high-intent consumers who arrive via search looking for a product or a service and then clicking through to make a purchase. That's the affiliate commerce and affiliate commission business. And so that particular traffic is harder to replace, though I'll talk about things that we're doing to offset. But that is harder to replace, and that is very much concentrated in our Tech & Shopping segment. In fact, just to dimensionalize it a little bit. So we did in 2025, roughly $90 million in affiliate commerce commissions related to organic traffic. That was down about $25 million year-over-year, and half of that $25 million was in Q4. So it gives you a sense of kind of the impact and what's going on within Tech & Shopping. From an offset point of view, and as I said, look, I think this is something that will start to materialize in the second half of this year, app traffic, browser extension traffic and then other forms of monetization outside of affiliate commerce around video, licensing, events and broader display. So a variety of things that mix. But the high level is where we're seeing search challenges show up, we're really seeing it within this Tech & Shopping segment.

Your next question is coming from Ross Sandler from Barclays.

Yes, that was really helpful on that $90 million. So that's about 25% of that segment's revenue in 2025. Can you just talk maybe about like the percent of traffic like and when we see -- it sounds like from your guidance, the kind of unwind of SEO traffic is peaking right now. And by the second half of '26, it should be less of a headwind. Is that the right way to think about it? And then the second question is just on the 300 bps of margin contraction in the first quarter. I guess just how do we think about in light of the declining kind of high-margin SEO-related traffic, how do we think about your ability to kind of contain the cost structure and these margins kind of moving forward?

Yes. Thanks, Ross. I'll answer your first one and then ask Bret to share some comments on the second one. But -- so just taking a step back, Tech & Shopping, obviously, is the challenge, was the challenge in Q4, will continue to be the challenge in 2026. Don't want to lose sight of the fact that the other 4 segments grew nicely in Q4 of 2025, and we believe will continue to grow in 2026. Within Tech & Shopping, the affiliate commerce piece is one of what I would refer to as 3 challenges within the business and worth describing and talking about the other 2 for a moment. So remember, we have the B2B business that's inside of the Tech & Shopping segment. You'll recall that our strategy in 2025 was to intentionally contract revenue at a rate that would be less than the contraction of expenses. In other words, we would cut more expenses than revenues, and we did that. So in 2025, the B2B revenues were down $11 million year-over-year, but the EBITDA was up close to $6 million and positive. So that strategy of shrinking the footprint of that business, cutting out certain products and service lines has worked, but shows up as a revenue drag. I just want to point that piece out. The last one is the published -- the Game Publishing business that's still a residual business that stayed within Tech & Shopping, which Bret pointed out, we sold, we're out of. That was like a $14 million, $15 million -- $14 million year-over-year bad guy in 2025 as well. So those are just 2 things to just point out as we think about '26 versus '25 that as we lap these things are going to be beneficial. But then yes, look, I think the belief that the pain that we're seeing on the affiliate commerce side in Tech & Shopping will start to improve in the second half, both because of comps as well as other initiatives, again, video monetization, licensing, building out traffic in both the RetailMeNot app and browser extension. And that collection brings the overall challenge of Tech & Shopping to being sort of more of a -- from a full year point of view, kind of a low single-digit decliner, but still a decliner.

And Ross, I think on margins, I think what I'd say is almost widen the lens for a moment. If you look back over the last several years, despite various puts and takes in the business, we've been able to largely maintain margin. It's been a deliberate effort across the company, looking at the way we do business as business dynamics change. I think as Vivek pointed out, within Tech & Shopping, we've recently shown one, our ability to do that in B2B, which has been a consistent source of revenue pressure for the last several years and taking action to look at how we run the business and maintain margin and produce margin, taking some actions on some drags like Humble Games. And then in the first quarter, I think what we're largely looking at is just the flow-through impact of some of that revenue softness, coupled with a little bit of mix change in some of the other businesses. And then as we look at -- I'm sorry, as we look at the company overall for fiscal year '26, as Vivek noted, in our view, it's kind of a little bit of a first half, second half story. And overall, if we progress as sort of anticipated, we think we'll be in the range of delivering upon what we said.

[Operator Instructions] And your next question is coming from Shyam Patil.

I had one on Tech & Shopping and one on M&A. Just on Tech & Shopping, Vivek, I know you guys have talked about there being a lot of moving parts in that business for this year. But how do you think about kind of what's the right growth rate or growth range for that business going forward, not just in '26, but just from a high-level perspective, what kind of growth rate do you think that business should have margin profile as well? And then on M&A, where do you see opportunities this year for M&A? Just kind of curious which segments, which pockets?

Yes. No, great question, Shyam. So I'll start on the long-term outlook on Tech & Shopping. And I don't believe it should be very different than our other Digital Media segments, principally Gaming & Entertainment and Health & Wellness. And so I think it should be a mid-single-digit grower. But again, I think we have to get through this phase where the search challenges within the affiliate commerce business that, by the way, was a business we created from scratch when we first bought the assets that make up a lot of this segment. And so look, we were very successful in creating a new form of monetization when we initially acquired a lot of the assets in this category. And I think we're very confident that we will find new forms of monetization within these brands. And by the way, when we talk about Tech & Shopping, we're talking about market-leading brands. CNET Group and RetailMeNot Group are leaders in their respective categories of Technology & Shopping. With respect to M&A, look, we believe that the market fear in digital media is actually presents us with a pretty unique opportunity to be an active buyer in this space. Look, the valuations are compelling. You see our own, and we're an at-scale diversified entity. You can imagine what businesses that don't have our scale of diversification, they ultimately trade for. And I think there's -- I think the fear is overly pronounced. And while there are certainly headwinds and we're experiencing those within our business, we've shown a fair amount of resilience in the face of these pressures and believe we've got a pretty good track record in business transformation and managing these really high-quality brands. And that's the key is going to -- our focus from an M&A point of view are really high-quality brands in high-value categories. So look, we've got the cash. We certainly have the free cash flow generation. And so we're going to continue to look for attractive opportunities. And so I think both things can be true, by the way, that we can be very focused on opportunities within the M&A landscape while we continue in the strategic review process to unlock value for shareholders.

Your next question is coming from Danny Pfeiffer from JPMorgan.

For the first, as you have discussions with outside advisers on the sale of businesses, can you provide any color on what divisions prospective buyers have been looking at the most? And then for the second, putting the AI headwinds aside, can you provide us with an update on the broader trends you're seeing in the ad market today?

Yes. So listen, look, we wish we could share more. But look, as we said in our prepared remarks, it's an active process. We promise and we're going to provide updates as and when we're able to. But right now, that's all I can really say at this point. On your question about the ad market, and I often say, look, for us, at least the ad market is not 1 market, it's 3. And I would say that if you unpack each of those, so we take Gaming & Entertainment last year, roughly 5% ad revenue growth. I think that will be consistent going into 2026. Health & Wellness had a very strong double-digit advertising growth rate in 2025. I think that will moderate a bit, be more sort of mid-single-digit range. Remember, in 2025 for us, within the Health & Wellness business, we had some acquisitions that accelerated some of that revenue growth. So the organic, I think, is mid-single digits. So I think both Gaming & Entertainment and Health & Wellness, which is largely pharma, is good. And I think we're happy with where we are there. It's the Tech & Shopping experience, which, again, I would bifurcate kind of the affiliate commerce from the non-affiliate commerce. I think the non-affiliate commerce, we feel pretty good about. It's the -- and the non-B2B, I should point out. But it's the affiliate commerce piece that we're going to have to work through a couple of quarters of challenges before we get to kind of the other side of that.

[Operator Instructions] Your next question is coming from Robert Coolbrith from Evercore ISI.

Can you speak more directly to both the traffic and the value at risk in Health & Wellness from search in general as well as some -- there's some concerns, I think, in the market around AI-based competition on the clinician side. So if you can maybe talk a little bit about that as well. And then finally, just to go back to M&A as both a buyer and seller, just given the level of AI-related uncertainty as well as the embedded call option on AI licensing, do you see that sort of freezing up the market? Or are you and potential counterparties able to sort of see through that, work through that?

Great questions, Rob. So with respect to the search dynamics within Health & Wellness, that's not an area that I'm really concerned. Much of the inventory within that segment is not search based. So we have our partnership, our hospital ad network, Mayo Clinic and Cleveland Clinic and hopefully soon adding some more to that network. We do these custom condition centers, which really don't rely on search engine traffic. We have our direct-to-provider business, which is largely e-mail and other forms of physician engagement. So with respect to H&W, Health & Wellness, I'm not concerned about whatever the search dynamics are. And so what I would say is that it's more of a pharma commercialization business where we work with pharma to commercialize their drugs and to drive patient adherence as well as helping influence doctors' understandings of the prescription opportunities that are available to them. I think with respect to your question on AI and M&A, look, I think that deals can be done, and I understand your point, which is some folks may be holding out just given that there could be a potential windfall on the AI licensing front and so may not be willing to transact right now. And I think it's a balance. Look, that's certainly a question that's out there that until we really understand what the revenue framework and potential is around licensed content for LLMs, you may have certain owners of content assets skittish about transacting. That's certainly out there. On the other hand, I think there are folks who just sit there and say, look, it's a difficult market, might be time for them to concede or to capitulate or they find it difficult to sort of bridge where they are to where they want to go, and that will be an opportunity for us. So look, I think it depends. I don't think there's one answer. That's certainly come up because people view it as "a free option" on AI licensing revenues in the future, but we'll see. And look, I think more broadly, I do think that there aren't as many buyers positioned the way we are positioned in terms of balance sheet capabilities, skill set, platforms and frankly, interest in these assets.

Got it. And just if we could go back to the growing AI footprint or the footprint of AI tools on the clinician side. Are you seeing any impact there or no real impact?

It's a good question. I mean I certainly believe that physicians like pretty much everyone else are using these AI tools in their day-to-day. And look, I think that obviously is something that will present, I imagine, marketing opportunities, et cetera. And so look, yes, look, I think that any and all tools that attract physician attention are valuable tools. And so we think we have valuable news, information, continuing medical education. The advantage of continuing medical education is providers need to get their CME credits. So we feel pretty good about a physician engagement platform that is tied to the need to get CME credits.

And there are no further questions in queue at this time. I would now like to hand the call back to Bret Richter for any closing remarks.

Thanks, Tom, and thanks, everyone, for joining us today. We appreciate your ongoing investment and time, and we look forward to speaking with you in the next couple of months and in our upcoming Q1 earnings call.

Thank you. This does conclude today's conference call. You can disconnect your phone lines at this time, and have a wonderful day. Thank you once again for your participation.