Spok Holdings, Inc. — Third Quarter 2026 Earnings Summary

Financial Performance:

• Total revenue for the three months ended September 30, 2026, was $32.999 million, a 2.6% decrease from $33.867 million in the prior year period; for the nine months ended September 30, 2026, total revenue was $101.236 million, a 4.4% decrease from $105.847 million.
• Wireless revenue for the quarter was $16.989 million (down 4.5% year-over-year), while Software revenue was $16.010 million (down 0.4% year-over-year).
• Net income for the quarter was $9.717 million, a 203.4% increase from $3.203 million in the prior year period; for the nine months, net income was $15.824 million, up 22.2% from $12.951 million.
• Adjusted EBITDA for the quarter was $8.568 million, up 29.6% from $6.610 million in the prior year period; for the nine months, Adjusted EBITDA was $22.968 million, up 3.0% from $22.303 million.
• Operating expenses for the quarter were $27.362 million (down 7.3% year-over-year), with Adjusted operating expenses at $26.061 million (down 8.5% year-over-year).
• Cash and cash equivalents balance was $30.071 million as of September 30, 2026, with no debt reported.
• Capital returned to stockholders in the quarter totaled $6.534 million.

Guidance and Future Outlook:

• The Company reiterated its full-year 2026 financial guidance estimates for revenue and Adjusted EBITDA.
• Full-year 2026 revenue guidance is set between $132.5 million and $139.5 million.
• Full-year 2026 Wireless revenue guidance is between $67.0 million and $70.0 million.
• Full-year 2026 Software revenue guidance is between $65.5 million and $69.5 million.
• Full-year 2026 Adjusted EBITDA guidance is between $28.0 million and $32.0 million.

Business Segments and Product Lines:

• Software license revenue grew 29.5% year-over-year to $1.393 million for the quarter.
• Managed services revenue increased 30.3% year-over-year to $2.355 million for the quarter.
• Professional services - projects revenue decreased 18.6% year-over-year to $2.970 million for the quarter.
• Hardware revenue decreased 39.9% year-over-year to $236,000 for the quarter.
• Maintenance and subscription revenue decreased 1.0% year-over-year to $9.056 million for the quarter.
• Research and development costs were $3.228 million for the quarter, supporting a focus on artificial intelligence and enhancements to the Care Connect® Suite.
• The Company closed an agreement to sell certain narrowband spectrum licenses, adding more than $7.5 million to cash balances.

Market and Competitive Landscape:

• Wireless units in service declined by 1.7% in the third quarter, representing a 12-basis point improvement in attrition from the second quarter.
• Wireless average revenue per unit (ARPU) was $8.36 for the quarter, up from $8.19 in the prior year period.
• Software operations bookings were $3.184 million for the quarter, down 28.3% year-over-year.
• Software backlog was $51.987 million as of September 30, 2026, down 14.6% from $60.897 million in the prior year period.
• Healthcare customers accounted for 82.7% of total ending units in service as of September 30, 2026.

Risks and Challenges:

• Risks include the ability to manage wireless network rationalization to lower costs without service disruption.
• Continued decline in the number of paging units in service and commensurate decline in wireless revenue.
• Dependence on the United States healthcare industry and long sales cycles for software solutions.
• Potential for cyberattacks, data breaches, or system disruptions affecting IT systems and third-party networks.
• Risks related to data privacy laws, regulatory changes in the healthcare industry, and intellectual property infringement claims.

Management Commentary and Tone:

• CEO Vincent D. Kelly stated the focus remains on generating cash flow, returning capital to stockholders, and responsibly investing for future growth.
• Management highlighted a "strategic realignment" to find efficiencies and monetize the asset base, noting confidence that these actions will create significant value.
• The Company is actively incorporating AI to accelerate product development timelines and reduce time to market for the Care Connect Suite.
• The Company announced the addition of Shiv Gopalkrishnan as executive vice president and general manager to lead engineering, product strategy, and sales.
• Management noted the quarterly dividend currently represents a yield in excess of 10% for stockholders.

Other Key Points:

• The Board of Directors declared a regular quarterly dividend of $0.3125 per share, payable on December 9, 2026, to stockholders of record on November 18, 2026.
• The Company generated more than $7.5 million in cash from the sale of narrowband licenses.
• Software backlog excludes $15.7 million of contractual obligations deemed cancellable by the customer as of September 30, 2026.
• The Company hosts a conference call and webcast on October 28, 2026, at 5:00 p.m. Eastern Time to discuss results.