TORONTO, May 7, 2026 /PRNewswire/ - Tucows Inc. $(TCX)$ (TSX: TC), a global internet services leader, today reported its unaudited financial results for the first quarter ended March 31, 2026. All figures are in U.S. dollars.
"Our first quarter results reflect steady execution across the business, with consolidated revenue and gross profit increasing year over year, driven by strong growth at Ting and continued margin gains in Tucows Domains," said David Woroch, CEO of Tucows. "We delivered positive cash flow this quarter, even with Adjusted EBITDA that was impacted by legacy mobile obligations and continued investment in Wavelo's go-to-market efforts. Overall, we remain focused on disciplined execution, strengthening the profitability of our core businesses, and continuing to move Ting's strategic process forward."
Financial Results
Consolidated net revenue for the first quarter of 2026 increased 2.0% to $96.7 million from $94.6 million for the first quarter of 2025, driven by strong revenue gains from Ting.
Gross profit for the first quarter of 2026 increased 2.5% to $24.1 million from $23.5 million from the first quarter of 2025. The increase in gross profit was driven by year-over-year margin gains from Tucows Domains, as well as a decrease in network expenses.
Net loss for the first quarter was $18.1 million ($1.63 per share), compared with a net loss of $15.1 million ($1.37 per share) in Q1 2025. Adjusted net loss(1) was $16.9 million (adjusted EPS(1) of ($1.51)) in Q1 2026 versus $14.9 million (adjusted EPS(1) of $(1.35)) in Q1 2025.
Adjusted EBITDA(1) for the first quarter of 2026 came down 15% to $11.7 million from $13.7 million for the first quarter of 2025. The year-over-year difference was driven primarily by obligations associated with our legacy mobile business, and investment in Wavelo's sales and marketing.
We ended the first quarter of 2026 with cash and cash equivalents, and restricted cash and restricted cash equivalents of $61.9 million. This compares with $64.2 million at the end of the fourth quarter of 2025 and $55.0 million at the end of the first quarter of 2025.
Summary Financial Results
(In Thousands of US Dollars, except Per Share data)
3 Months ended March 31
------------------------------------ ----------------------------------------
2026 2025 % Change
(unaudited) (unaudited) (unaudited)
------------------------------------ ------------ ------------ ------------
Net Revenues 96,657 94,609 2 %
------------------------------------ ------------ ------------ ------------
Gross Profit 24,130 23,531 3 %
------------------------------------ ------------ ------------ ------------
Income Earned on Sale of Transferred
Assets, net 2,516 2,741 (8) %
------------------------------------ ------------ ------------ ------------
Net Income (Loss) (18,107) (15,133) (20) %
------------------------------------ ------------ ------------ ------------
Adjusted Net Income (Loss)(1) (16,852) (14,914) (13) %
------------------------------------ ------------ ------------ ------------
Basic earnings (Loss) per common
share (1.63) (1.37) (19) %
------------------------------------ ------------ ------------ ------------
Adjusted Basic earnings (Loss) per
common share(1) (1.51) (1.35) (12) %
------------------------------------ ------------ ------------ ------------
Adjusted EBITDA(1) 11,667 13,671 (15) %
------------------------------------ ------------ ------------ ------------
Net cash provided by (used in)
operating activities 3,524 (11,251) 131 %
------------------------------------ ------------ ------------ ------------
(1) Non-GAAP financial measures are described below and reconciled to GAAP
measures in the accompanying tables.
Summary of Revenues, Gross Profit and Adjusted EBITDA
(In Thousands of US Dollars)
Revenue Gross Profit Adj. EBITDA(1)
------------- ------------------------ ------------------------ ------------------------
3 Months ended March 31 3 Months ended March 31 3 Months ended March 31
------------------------ ------------------------ ------------------------
2026 2025 2026 2025 2026 2025
(unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
------------- ----------- ----------- ----------- ----------- ----------- -----------
DOMAINS AND
WAVELO
SERVICES
------------- ----------- ----------- ----------- ----------- ----------- -----------
Tucows Domain
Services:
------------- ----------- ----------- ----------- ----------- ----------- -----------
Wholesale
------------- ----------- ----------- ----------- ----------- ----------- -----------
Domain
Services 48,805 50,004
------------- ----------- ----------- ----------- ----------- ----------- -----------
Value Added
Services 5,460 5,903
------------- ----------- ----------- ----------- ----------- ----------- -----------
Total
Wholesale 54,265 55,907
------------- ----------- ----------- ----------- ----------- ----------- -----------
Retail 9,835 9,348
------------- ----------- ----------- ----------- ----------- ----------- -----------
Total Tucows
Domain
Services 64,100 65,255 18,634 18,320 11,627 11,540
------------- ----------- ----------- ----------- ----------- ----------- -----------
Wavelo
Services: 11,561 11,396 7,015 7,752 3,616 4,449
------------- ----------- ----------- ----------- ----------- ----------- -----------
Total Domains
and Wavelo
Services 75,661 76,651 25,649 26,072 15,243 15,989
------------- ----------- ----------- ----------- ----------- ----------- -----------
TING INTERNET
SERVICES
------------- ----------- ----------- ----------- ----------- ----------- -----------
Fiber
Internet
Services 17,128 16,315
------------- ----------- ----------- ----------- ----------- ----------- -----------
Construction
Services 2,246 -
------------- ----------- ----------- ----------- ----------- ----------- -----------
Total Ting 19,374 16,315 1,720 33 (430) (854)
------------- ----------- ----------- ----------- ----------- ----------- -----------
CORPORATE &
OTHER
------------- ----------- ----------- ----------- ----------- ----------- -----------
Mobile
Services and
Eliminations 1,622 1,643 (3,239) (2,574) (3,146) (1,464)
------------- ----------- ----------- ----------- ----------- ----------- -----------
Total 96,657 94,609 24,130 23,531 11,667 13,671
------------- ----------- ----------- ----------- ----------- ----------- -----------
(1) Non-GAAP financial measures are described below and reconciled to GAAP
measures in the accompanying tables.
(2) Beginning in the third quarter of 2025, the Company revised its
presentation of segment gross profit to reflect amounts net of network
expenses. This change provides a more consistent view of segment-level
profitability and aligns with how management evaluates operating
performance. The revision did not impact gross profit, Adjusted EBITDA or
revenue.
Notes:
1. Tucows reports all financial information required in conformity with United States generally accepted accounting principles (GAAP).
Along with this information, to assist financial statement users in an assessment of our historical performance, the Company discloses non-GAAP financial measures in press releases and on investor conference calls and related events, as the Company believes that the non-GAAP information enhances investors' overall understanding of our financial performance, and should be read in addition to, rather than instead of, the financial statements prepared in accordance with GAAP.
Non-GAAP financial measures do not reflect a comprehensive system of accounting and may differ from non-GAAP financial measures with the same or similar captions that are used by other companies and/or analysts and may differ from period to period. The Company endeavors to compensate for these limitations by providing the relevant disclosure of the items excluded in the calculation of Adjusted EBITDA to net income based on U.S. GAAP; Adjusted net income to GAAP net income; and adjusted basic earnings per share to GAAP basic earnings per share, which should be considered when evaluating the Company's results. Tucows strongly encourages investors to review its financial information in its entirety and not to rely on a single financial measure.
Adjusted EBITDA
The Company believes that the provision of this supplemental non-GAAP measure allows investors to evaluate the operational and financial performance of the Company's core business using similar evaluation measures to those used by management. The Company uses Adjusted EBITDA to measure its performance and prepare its budgets. Since Adjusted EBITDA is a non-GAAP financial performance measure, the Company's calculation of Adjusted EBITDA may not be comparable to other similarly titled measures of other companies; and should not be considered in isolation, as a substitute for, or superior to measures of financial performance prepared in accordance with GAAP. Because Adjusted EBITDA is calculated before certain recurring cash charges, including interest expense and taxes, and is not adjusted for capital expenditures or other recurring cash requirements of the business, it should not be considered as a liquidity measure.
The Company's Adjusted EBITDA definition excludes depreciation, impairment and loss on disposition of property and equipment, amortization of intangible assets, income tax provision, interest expense (net), stock-based compensation, asset impairment, gains and losses from unrealized foreign currency transactions, loss on debt extinguishment and costs that are not indicative of on-going performance (profitability), including acquisition and transition costs. Gains and losses from unrealized foreign currency transactions removes the unrealized effect of the change in the mark-to-market values on outstanding unhedged foreign currency contracts, as well as the unrealized effect from the translation of monetary accounts denominated in non-U.S. dollars to U.S. dollars.
The following table reconciles net income (loss) to Adjusted EBITDA (in thousands of US dollars):
3 Months ended March 31
------------------------------------------ ----------------------------------
2026 (unaudited) 2025 (unaudited)
------------------------------------------ ---------------- ----------------
Net income (Loss) for the period (18,107) (15,133)
------------------------------------------ ---------------- ----------------
Less:
------------------------------------------ ---------------- ----------------
Provision (recovery) for income taxes 2,392 2,166
------------------------------------------ ---------------- ----------------
Depreciation of property and equipment 9,871 10,460
------------------------------------------ ---------------- ----------------
Impairment of property and equipment 280 204
------------------------------------------ ---------------- ----------------
Loss (gain) on disposition of property and
equipment 876 -
------------------------------------------ ---------------- ----------------
Amortization of intangible assets 1,103 1,205
------------------------------------------ ---------------- ----------------
Interest expense, net 13,865 13,613
------------------------------------------ ---------------- ----------------
Stock-based compensation 1,094 1,505
------------------------------------------ ---------------- ----------------
Unrealized loss (gain) on foreign exchange
revaluation of foreign denominated
monetary assets and liabilities 194 (364)
------------------------------------------ ---------------- ----------------
Acquisition and transition costs* 99 15
------------------------------------------ ---------------- ----------------
Adjusted EBITDA 11,667 13,671
------------------------------------------ ---------------- ----------------
* Acquisition and transition costs represent transaction-related expenses and
transitional expenses. Expenses include severance or transitional costs
associated with department, operational or overall company restructuring
efforts, including geographic alignments.
Adjusted Net Income and Adjusted Basic Earnings Per Common Share (Adjusted EPS)
The Company believes that the provision of this supplemental non-GAAP measure allows investors to best evaluate our operating results and understand the operating trends of our core business without the effect of acquisition and transition costs, impairment expenses and losses on extinguishment of debt. Acquisition and transition costs represent transaction-related expenses and transitional expenses. Expenses include severance or transitional costs associated with department, operational or overall company restructuring efforts, including geographic alignments. Since adjusted net income and adjusted EPS are non-GAAP financial performance measures, the Company's calculation of adjusted net income and adjusted EPS may not be comparable to other similarly titled measures of other companies; and should not be considered in isolation, as a substitute for, or superior to measures of financial performance prepared in accordance with GAAP.
The Company's adjusted net income and adjusted EPS definitions exclude from the calculation of reported GAAP net income and GAAP EPS, the effect of the following items: impairment of property and expenses, acquisition and transition costs (including restructuring charges) and loss on debt extinguishment.
The following table reconciles adjusted net income and adjusted EPS to GAAP net income (In thousands of US dollars, except Per Share data):
3 Months ended March 31
------------------------------------------ ----------------------------------
2026 (unaudited) 2025 (unaudited)
------------------------------------------ ---------------- ----------------
Net Income (Loss) for the period (18,107) (15,133)
------------------------------------------ ---------------- ----------------
Less:
------------------------------------------ ---------------- ----------------
Acquisition and transition costs* 99 15
------------------------------------------ ---------------- ----------------
Impairment of property and equipment 280 204
------------------------------------------ ---------------- ----------------
Loss (gain) on disposition of property and
equipment 876 0
------------------------------------------ ---------------- ----------------
Adjusted Net Income (Loss)(1) for the
period (16,852) (14,914)
------------------------------------------ ---------------- ----------------
Adjusted Basic Earnings (Loss) Per Common
Share(1) (1.51) (1.35)
------------------------------------------ ---------------- ----------------
* Acquisition and transition costs represent transaction-related expenses and
transitional expenses. Expenses include severance or transitional costs
associated with department, operational or overall company restructuring
efforts, including geographic alignments.
Management Commentary
Concurrent with the dissemination of its quarterly financial results news release at 5:05 p.m. ET on Thursday, May 7, 2026, management's pre-recorded audio commentary (and transcript), discussing the quarter and outlook for the Company will be posted to the Tucows website at http://www.tucows.com/investors/financials.
Following management's prepared commentary, for the subsequent seven days, until Thursday, May 14, 2026, shareholders, analysts and prospective investors can submit questions to Tucows' management at ir@tucows.com. Management will post responses to questions in an audio recording and transcript to the Company's website at http://www.tucows.com/investors/financials, on Wednesday, May 20, 2026, at approximately 5 p.m. ET. All questions will receive a response, however, questions of a more specific nature may be responded to directly.
About Tucows
Tucows helps connect more people to the benefit of internet access through communications service technology, domain services, and fiber-optic internet infrastructure. Ting .
Tucows, Ting, Wavelo, and Hover are registered trademarks of Tucows Inc. or its subsidiaries.
This release includes forward-looking statements as that term is defined in the U.S. Private Securities Litigation Reform Act of 1995, including statements regarding our expectations regarding our future financial results. These statements are based on management's current expectations and are subject to a number of uncertainties and risks that could cause actual results to differ materially from those described in the forward-looking statements. Information about other potential factors that could affect Tucows' business, results of operations and financial condition is included in the Risk Factors sections of Tucows' filings with the Securities and Exchange Commission. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty. All forward-looking statements are based on information available to Tucows as of the date they are made. Tucows assumes no obligation to update any forward-looking statements, except as may be required by law.
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SOURCE Tucows Inc.
(END) Dow Jones Newswires
May 07, 2026 17:05 ET (21:05 GMT)