Acacia Research Corporation — Third Quarter 2026 Earnings Summary

Financial Performance:

• Total revenue was $54.4 million for the quarter, a decrease of 8% compared to $59.4 million in the prior-year quarter, primarily driven by lower paid-up license revenue from the Intellectual Property Operations segment.
• GAAP Net Loss was $5.6 million, resulting in a GAAP Diluted EPS of ($0.06), compared to a GAAP Net Loss of $2.7 million and GAAP Diluted EPS of ($0.03) in the prior-year quarter.
• Adjusted Net Income was $4.3 million, resulting in Adjusted Diluted EPS of $0.04, compared to an Adjusted Net Loss of $1.1 million and Adjusted Diluted EPS of ($0.01) in the prior-year quarter.
• Total Company Adjusted EBITDA was $3.9 million for the quarter, down from $8.0 million in the prior-year quarter.
• Operated Segment Adjusted EBITDA was $9.1 million for the quarter, down from $12.6 million in the prior-year quarter.
• Free Cash Flow for the quarter was $10.3 million, compared to $7.7 million in the prior-year quarter.
• Total cash, cash equivalents, equity securities measured at fair value, and loans receivable totaled $346.3 million ($3.55 per share) at quarter end, up from $339.6 million at December 31, 2025.
• Consolidated total indebtedness was $90.4 million, consisting of $59.5 million at Benchmark Energy and $30.9 million at Deflecto; parent company indebtedness was zero.

Guidance and Future Outlook:

• Management stated the company remains focused on compounding long-term intrinsic value per share through disciplined capital allocation, citing an active acquisition pipeline and flexible investment mandate.
• Benchmark Energy closed a senior secured note financing of up to $47.5 million (including $27.5 million committed) post-quarter end to fund a multi-well development program in the Western Anadarko Basin; the financing is non-recourse to Acacia and Benchmark's other assets.

Business Segments and Product Lines:

• Energy Operations: Generated $19.5 million in revenue, its second strongest quarter under Acacia ownership, up from $14.2 million in the prior-year quarter. Adjusted EBITDA was $9.1 million, up from $6.1 million.
• Industrial Operations: Generated $7.5 million in revenue, up from $6.7 million in the prior-year quarter. Adjusted EBITDA was $1.5 million, up from $0.8 million.
• Manufacturing Operations: Generated $27.2 million in revenue, down from $30.8 million in the prior-year quarter. Adjusted EBITDA was $1.0 million, down from $2.6 million.
• Intellectual Property Operations: Generated $0.3 million in revenue, down from $7.8 million in the prior-year quarter. Adjusted EBITDA was a loss of $2.5 million, compared to income of $3.0 million.
• The company sold an unoccupied portion of Deflecto's manufacturing facility in the U.K. for $1.6 million.
• Acacia purchased additional interests in the Wi-Fi 7 portfolio for $1.8 million.

Market and Competitive Landscape:

• The press release does not provide specific data on market share, specific competitor names, or broader market trend analysis beyond general references to oil and gas production economics and IP demand.

Risks and Challenges:

• Risks include the ability to successfully identify and integrate acquisitions, performance of operating businesses, retention of employees and management teams, and changes in relationships with Starboard Value LP.
• Specific risks for Benchmark include hedging strategy risks, operational hazards, reserve replacement challenges, and the potential for oil or natural gas production to become uneconomic.
• Specific risks for Intellectual Property Operations include the ability to develop licensing programs, attract new business, and changes in demand for IP rights or legislative/regulatory developments.
• General risks include supply chain disruptions, labor shortages, inflationary pressures, geopolitical events, cybersecurity threats, and changes in safety, health, and environmental regulations.

Management Commentary and Tone:

• CEO Martin ("MJ") D. McNulty, Jr. described total revenue excluding Intellectual Property Operations as a "near record" and noted it increased for the third consecutive quarter.
• Management highlighted the successful closing of the non-recourse financing for Benchmark Energy as a mechanism to accelerate development while isolating program risk.
• The tone regarding capital allocation was confident, emphasizing the "active acquisition pipeline" and "flexible investment mandate."

Other Key Points:

• Book value per share was $5.65 at September 30, 2026, based on total stockholders' equity of $551.6 million and 97.6 million shares outstanding.
• Equity method investments decreased to zero due to the impairment of the investment in MalinJ1 during the second quarter of 2026.
• Loans receivable totaled $5.6 million, representing commercial loans collateralized by Bitcoin purchased through a partnership with Unchained Capital.
• The company hosted an investor conference call on November 5, 2026.