10-Q · May 14, 2026
Inuvo's Q1 2026 results reveal significant challenges, with revenue plummeting 70.3% year-over-year to $7.93 million, missing estimates by nearly 29%. EPS was reported at -$0.29, down from a previous estimate of -$0.18,…
Earnings analysis · 10-Q
INUV earnings analysis
Filed August 11, 2026 · Our reading of the company's report
The latest report
Inuvo’s Q2 2026 results show severe operating deterioration: revenue fell 66.8% year over year to $7.535 million, gross margin declined to approximately 44.2%, operating margin was approximately negative 40.4%, and EPS…
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Inuvo’s Q2 2026 results show severe operating deterioration: revenue fell 66.8% year over year to $7.535 million, gross margin declined to approximately 44.2%, operating margin was approximately negative 40.4%, and EPS was negative $0.27. Audience Modeling and IntentKey grew 19% year over year, but this was more than offset by an 80% Legacy Search decline following the Bonfire Reset and broader search-market changes. Cost reductions and approximately $3.0 million of post-quarter financing proceeds support near-term liquidity, but a $4.8 million working-capital deficit, $717,262 of six-month operating cash burn and potential monthly note redemptions remain significant risks.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $-0.27
What stood out
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Audience Modeling offsets part of revenue decline
Q2 revenue was $7.535 million, down 66.8% year over year from $22.671 million and approximately 5.8% sequentially from about $8 million in Q1 2026. Revenue was also $0.1 million, or 3.6%, below the $7.816 million consensus estimate.
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IntentKey channel continues to grow
Audience Modeling revenue increased 19% year over year in Q2 2026 and 16% for the six months ended June 30, 2026, as management continued investing in the IntentKey platform.
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Gross margin remains under pressure
Gross profit was $3.328 million and gross margin was approximately 44.2%, down from 75.4% in Q2 2025 and 46.2% in Q1 2026. Management attributed the mix-driven pressure to the decline in higher-gross-margin Legacy Search revenue.
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Material cost reductions underway
Operating expenses fell 66.7% year over year to $6.370 million in Q2, including a 90.1% reduction in marketing costs to $1.393 million. Employment declined 38% to 51 employees at June 30, 2026 from 82 one year earlier.
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Post-quarter equity financing added liquidity
Total cash, cash equivalents and restricted cash were approximately $7.1 million at June 30, 2026, including $6.2 million of restricted cash. The July 1 offering generated approximately $3.0 million of gross proceeds before $0.6 million of fees and offering expenses.
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Management identifies twelve-month liquidity runway
Management reported $6.2 million of non-recurring class-action settlement proceeds received in January 2026 and stated that current cash, the Note Purchase Agreement, July financing proceeds and expected operating cash flows should sustain operations for at least the next twelve months.
What to watch
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Legacy Search recovery remains uncertain
Q2 net revenue declined 66.8% year over year to $7.535 million, with Legacy Search revenue down 80%. Management said the business may improve gradually but there is no assurance it will fully recover, and further declines could continue to pressure revenue, margins and cash flows.
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Liquidity and recurring cash burn
The company had a net working capital deficit of approximately $4.8 million and used $717,262 in operating cash during the first six months of 2026. Management also disclosed an accumulated deficit of $180.4 million and recurring operating losses and cash outflows.
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Mandatory note redemptions constrain liquidity
Streeterville may redeem up to $750,000 per month under the A-1 Note beginning nine months after issuance, while the $6.2 million B Note proceeds remain restricted and unavailable for general working capital unless released through a permitted Note Exchange.
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Revenue concentration increased across customers
Four customers represented 13.7%, 15.5%, 20.5% and 30.5% of Q2 revenue, collectively approximately 80.2%. The loss of, or delayed payment by, any major customer could materially harm results and financial condition.
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Profitability deteriorated sharply
The Q2 net loss was $2.144 million and diluted EPS was negative $0.27, compared with positive diluted EPS of $0.13 in Q1 2026 and negative $0.10 in Q2 2025.
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Two subsidiary litigation claims pending
The company reported $1.5 million of damages sought in the Carambolico lawsuit and approximately $766,000 in unpaid invoices sought in the AEM Days lawsuit. Management believes both claims are without merit but intends to defend them.
Management's outlook
No numeric revenue or EPS guidance was provided. Management expects Legacy Search to improve gradually as 2026 progresses, but stated there is no guarantee it will fully recover; it also expects to return to and maintain positive operating cash flow if its IntentKey plan succeeds.
Earlier filings 4
10-K · March 5, 2026
Inuvo positions itself as a leader in generative AI for audience intent discovery, commercializing its IntentKey® LLM that maps over 25 million ideas and is protected by 18 issued and three pending U.S. patents.…
10-K · February 29, 2024
Inuvo positions itself as an ad-tech company differentiated by proprietary generative large language AI (IntentKey) and its Bonfire marketing platform, claiming 19 issued and eight pending patents and delivery of…
10-Q · May 4, 2023
Inuvo reported Q1 2023 revenue of $11,847,440, down from $18,609,367 in Q1 2022 (a decline of $6,761,927 or 36.34%). Gross profit was $8,656,877 (gross margin ~73.07%), but the company recorded an operating loss of…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.