Kidoz Inc. (TSXV:KDOZ)(OTCQB:KDOZF) reported unaudited financial results for the three and six months ended June 30, 2026. The company recorded Q2 revenue of $3,334,835, up 37% from $2,430,216 in Q2 2025, while first-half revenue reached $6,281,576, a 22% increase from $5,168,519.
The company describes itself as a full-stack global advertising platform powered by contextual AI. It says its mobile gaming advertising technology operates without reliance on personal data. The figures are presented in United States dollars and prepared under United States Generally Accepted Accounting Principles.
#Revenue and gross profit
Kidoz reported Q2 gross profit of $1,418,582, compared with $1,161,972 in the same quarter of 2025. The company said this represented an increase of 22%.
Despite the increase in gross profit, Q2 gross margin declined to 42.5% from 47.8% in the prior-year quarter. For H1 2026, gross profit was $2,673,688, up 8% from $2,484,316, while gross margin was 42.6%, compared with 48.1% in H1 2025.
#Higher operating expenditure and wider losses
Q2 sales and marketing expenditure was $665,828, an increase of 50% from $444,520 in Q2 2025. Content and software development expenditure rose 10% to $895,692 from $816,153.
Total Q2 operating expenses were $2,990,617, compared with $2,320,314 a year earlier. Kidoz reported a Q2 net loss and comprehensive loss of ($1,558,343), versus ($1,171,483) in Q2 2025.
For the first half, sales and marketing expenditure was $1,291,928, up from $764,784. Content and software development expenditure was $1,828,895, compared with $1,491,680. H1 operating expenses totalled $5,103,123, versus $3,686,645 in H1 2025, and the net loss and comprehensive loss was ($2,372,907), compared with ($1,111,340).
#Bonus expense and accounting presentation
Kidoz said bonuses and incentive compensation amounted to $862,863 in Q2 2026, compared with $687,728 in Q2 2025. According to the company, annual bonuses are recorded in the second quarter and are based on the previous year's performance. It said this timing creates a concentrated effect on Q2 operating expenses and the reported loss, and that the expense should not be viewed as a recurring quarterly run rate.
The company also said certain server costs were moved from content and software development to cost of sales in Q2 2026. Bonuses and incentive compensation were presented separately after being reclassified from several operating expense categories. Comparative 2025 figures were recast for presentation, and Kidoz said the changes did not affect total income from operations.
#Cash and working capital
As at June 30, 2026, Kidoz reported cash of $1,328,558 and working capital of $2,886,235. At December 31, 2025, the company had cash of $4,454,295 and working capital of $5,080,637.
#Company comments on investment levels
Chief Executive Officer Jason Williams said the company was continuing to invest in its platform, sales and marketing activities, software development and global operations. Kidoz said these investments contributed to higher expenditure during the reporting periods.
The company also stated that a significant proportion of annual revenue had been generated in Q4 in prior years, while product development, technology, sales and personnel investments were made throughout the first three quarters. Kidoz said quarterly results should be considered in that context and clarified that this was not guidance for any future quarter.
#Key Takeaways
- Q2 2026 revenue was $3,334,835, an increase of 37% from Q2 2025.
- H1 2026 revenue was $6,281,576, up 22% from H1 2025.
- Gross margins declined to 42.5% in Q2 and 42.6% for H1.
- Q2 operating expenses rose to $2,990,617 and the quarterly net loss and comprehensive loss was ($1,558,343).
- Cash was $1,328,558 and working capital was $2,886,235 as at June 30, 2026.
Original source: Read original article