RTB — Q2 2026 Financial Report Analysis

A merger, not a business, drove the 350% revenue jump

RTB Digital's revenue rose to $2.33 million in the quarter ended June 30, 2026, from $0.52 million a year earlier — a 350.3% increase that says almost nothing about the underlying business. Of the $1.81 million of added revenue, $1.70 million came from the payment-processing operation RTB picked up when its merger with Ryvyl Inc. closed on May 12, 2026, and which therefore contributed only about seven weeks of the quarter. The company's own Platform Operations business — the "Roundtable" media platform that is its stated strategic focus — grew $113 thousand, or 21.9%.

The more revealing number is in the filing's pro forma table, which restates results as if the two companies had been combined since January 1, 2025. On that basis, revenue was $3.71 million this quarter against $3.30 million a year ago: about 12.5% growth, not 350%. ("Pro forma" here simply means a hypothetical combined history, used so the two periods can be compared like for like.)

Meanwhile the cost of getting there landed all at once. Operating expenses rose to $9.80 million from $0.91 million, and the net loss widened to $9.58 million from $0.12 million. Losing roughly four dollars for every dollar of revenue booked is the defining fact of this quarter.

Key figures

All figures from the condensed consolidated statements of operations in the Form 10-Q for the quarter ended June 30, 2026. Gross margin is gross profit as a share of revenue — what is left of each revenue dollar after the direct cost of delivering the service, before overhead.

Where the $9.8 million of operating expense went

General and administrative expense alone was $7.53 million, up $7.05 million year over year. Management attributes it to three identifiable buckets:

• $3.3 million to modify and settle warrants issued to Ryvyl investors before the merger, of which $2.7 million was non-cash (a charge recorded in the accounts without money leaving the business). Warrants held by Funicular Funds and Armistice Capital carried a put option — a right to force the company to pay out the warrants' Black-Scholes value once the merger closed. Buying out that right is what produced the charge. Note 9 shows the related warrant liabilities remeasured to $4.90 million immediately before being reclassified into equity at June 30.
• $2.3 million of expense carried by the acquired fintech business, of which $1.8 million was professional fees — that figure itself including the $1.2 million closing advisory fee plus merger-related legal and accounting costs — alongside $0.3 million of personnel costs and $0.2 million of stock-based compensation.
• $0.8 million of additional professional fees (consulting, legal, accounting) and $0.2 million of higher personnel cost at the platform business.

Strip out the $3.3 million warrant charge and the $1.2 million closing fee and G&A would still be roughly $3.0 million — about six times last year's level, on revenue that is genuinely only about 22% higher outside the acquisition. The merger-driven items are non-recurring; the underlying cost base is not.

Selling and marketing rose $1.70 million to $2.02 million, of which $1.1 million reflects the cost of signing sports content partners — management says over 150 reporters and team publishers joined during 2026 — plus $0.1 million of brand marketing and $0.2 million from the acquired fintech business. Research and development rose only $0.15 million to $0.26 million, mostly amortization of acquired intangibles and capitalized software rather than incremental engineering spend.

Margins moved the wrong way, and the reason is in the revenue mix

Gross margin fell from 55.7% to 37.4%. The two segments explain it:

Platform Operations — the part management calls its core business — saw its own gross margin collapse from 55.7% a year ago to 31.3%. Gross profit there actually fell in absolute terms, from $288 thousand to $197 thousand, despite revenue rising 21.9%. Management gives two specific causes: an increased revenue guarantee owed to a key programmatic advertising partner (programmatic ads are sold by automated auction rather than by a salesperson, and typically price lower than directly sold sponsorships), and higher content personnel costs. The revenue commentary confirms the mix shift: growth came from "programmatic ads and syndication revenue, partially offset by direct ads and sponsorship revenues." Higher-priced direct sponsorship revenue shrank while cheaper automated inventory grew, and the guarantee to the ad partner puts a floor under what RTB owes regardless of what that inventory earns. Growing the top line while shrinking gross profit is not a scale problem that volume fixes.

The acquired fintech segment is the better-margin business of the two on these seven weeks of data, which sits awkwardly with management's description of it as "legacy," with its long-term treatment still "informed by an ongoing assessment of business applicability to the Platform business, profitability, market conditions, and resource allocation priorities."

The balance sheet is where the risk actually sits

Total assets grew to $44.06 million from $28.51 million at December 31, 2025, but the composition changed completely:

Management reports working capital — current assets minus the bills due within a year — of approximately $4.1 million. That figure depends entirely on one line: a $10.0 million nonrefundable deposit on a "digital media investment," classified as a current asset. The filing discloses the deposit on the balance sheet and in the cash flow discussion but includes no note naming the counterparty, the terms, or what the company receives for it. Remove that single item and current liabilities exceed remaining current assets by about $5.9 million.

Against $11.04 million of current liabilities — including $5.09 million of accounts payable and $5.17 million of accrued expenses, of which $3.38 million is accrued legal settlements — the company held $0.49 million of cash, $0.25 million of restricted cash and $0.10 million of USDC: $0.84 million of liquid funds in total. Management nonetheless states it believes existing cash and other sources of liquidity will be sufficient for at least the next 12 months.

The digital-asset treasury paid for the quarter, and paid dearly. The stablecoin position went from $10.96 million to $0.10 million in six months: $2.49 million of it settled accounts payable directly, $1.30 million funded a loan receivable, $0.30 million bought an equity stake in a related party, and most of the rest was converted to cash. Bitcoin holdings fell from 59.67 coins to 35.37. The remaining coins carry a first-in-first-out cost basis of $4.39 million against a fair value of $2.07 million — roughly $124,100 per coin paid versus about $58,600 per coin at June 30. The company booked a $0.40 million realized loss on crypto sales and $1.03 million of unrealized mark-downs in the first half. Financing the business by selling an asset that has halved is expensive financing.

Goodwill and intangibles together are $22.00 million, or half of total assets. Goodwill of $11.12 million arose because the $14.57 million of merger consideration exceeded the $3.46 million fair value of Ryvyl's net assets — RTB assumed $7.96 million of accrued expenses and $2.83 million of payables along with $4.24 million of cash and $9.82 million of identified intangibles (mostly $9.3 million of customer relationships). The purchase price allocation is explicitly preliminary. An asset base half composed of goodwill and customer relationships attached to a business management has not committed to keeping is a live impairment risk.

Takeaway: The reported $4.1 million of working capital rests on a single $10.0 million nonrefundable deposit whose counterparty and terms are not disclosed anywhere in the filing. Set that aside and RTB has $0.84 million of liquid assets against $11.04 million of near-term obligations, having already spent nearly all of the $11 million stablecoin treasury that funded the first half — so the next two quarters depend on raising capital or realizing value from that deposit, not on operations.

Cash flow: the merger and the crypto sales funded everything

Operating activities consumed $5.17 million in the first half, against $0.65 million a year earlier. Investing activities provided $3.38 million — an unusual sign, because it came from liquidating assets rather than deploying them: $10.22 million of crypto-asset sale proceeds plus $4.24 million of cash that arrived with Ryvyl, offset by the $10.00 million deposit, $0.67 million of capitalized software and $0.50 million of a note receivable. Financing added $2.00 million from a March 2026 convertible note. Net change in cash for six months: an increase of $0.21 million, to $0.74 million including restricted cash.

Put plainly: roughly $16 million of one-time inflows produced $210 thousand of net cash, because $10 million went straight back out as a deposit and $5.2 million funded the loss.

Dilution is understated by the per-share figures

The $1.24 loss per share is calculated on 7,735,490 weighted average shares — an average across the quarter that is well below the 13,301,694 shares outstanding at June 30, because $30.15 million of September 2025 convertible notes automatically converted into 7,688,755 shares mid-quarter when the merger triggered them. On the quarter-end count, the same loss is about $0.72 per share. Shares outstanding more than tripled from 4,165,106 at December 31, 2025 to 13,301,694 at June 30, and reached 14,008,209 by August 13, 2026.

More dilution is contracted for. The March 2026 convertible note carries a "price protection feature" obliging RTB to issue additional shares if its market capitalization falls below specified thresholds when the investor's restricted shares become transferable in 25% tranches at 12, 15, 18 and 21 months after the merger. That obligation is carried at $0.90 million at June 30 — it cost $0.40 million in fair value losses this quarter alone — and is capped at $15.0 million of additional shares. It is, by construction, an obligation that grows as the stock falls.

What to watch next

The company gave no revenue or earnings guidance, which is normal for a quarterly filing. Three concrete items from the subsequent-events disclosures shape the September quarter:

• Armistice warrant resolution (August 2026). RTB paid Armistice $300 thousand to modify its warrant; Armistice then paid RTB $1.40 million to extinguish the company's right to cancel the warrant, and 350,000 shares were issued on August 12 under an automatic cashless exercise. Net effect: about $1.1 million of cash in and 350,000 shares out. The Funicular warrant was also fully extinguished for 20,000 restricted shares plus a 67,999-share cashless exercise. Both warrant overhangs are now gone.
• The $1.8 million Lagodivilla loan. Originally due June 3, 2026, it went past maturity before quarter-end and was extended to September 15, 2026. No credit-loss allowance was recorded. Repayment would roughly triple liquid assets; another extension would say something different.
• The related-party note. A separate $5.0 million zero-interest note to Roustan Media and True Sports — entities owned by a related party — carries $4.17 million net of a $0.75 million reserve. RTB has collected $80 thousand in total against it and filed a breach-of-contract claim in June 2026 over late principal payments. That single receivable is larger than the company's annualized revenue.

Our read: the fintech acquisition bought RTB revenue, $4.2 million of cash and $128.0 million of Ryvyl federal net operating loss carryforwards (tax losses that can shelter future profits, though Section 382 of the tax code will limit their use after an ownership change, and a full analysis has not been done). What it did not buy is a path to funding itself. First-half operating cash burn ran at $5.2 million, about $0.86 million a month; the $0.84 million of cash and stablecoin on hand covers roughly one month of that, and about three and a half months if the remaining bitcoin is sold at its June 30 mark. The platform business — the part management says it is prioritizing — is growing revenue at about 22% while its gross profit shrinks, which means scale currently makes the loss larger, not smaller. The most informative disclosures in the next 10-Q will not be the revenue line, which will finally show a full quarter of fintech and so jump again for mechanical reasons; they will be the platform segment's gross margin, whether the $10.0 million deposit converts into an identifiable asset, and whether a financing gets done before the cash does run out.