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Globe and Mail
6 days ago
- Business
- Globe and Mail
VerticalScope Announces Second Quarter 2025 Financial Results
VerticalScope Holdings Inc. ('VerticalScope' or the 'Company') (TSX: FORA; OTCQX: VFORF), a technology company that has built and operates a cloud-based digital platform for online enthusiast communities, today announced financial results for the second quarter ended June 30, 2025 ("Q2" or "the quarter"). 'In Q2, our platform served 90 million MAUs and generated $14.5 million in revenue,' said Chris Goodridge, CEO of VerticalScope. 'The real story this quarter is the speed at which we've reshaped our teams and sharpened our focus to position the Company for long-term growth. Our profitable model and strong cash generation give us the firepower to invest decisively in high-impact initiatives, from expanding direct traffic to accelerating AI-powered innovation.' Mr. Goodridge added, 'The way people find and consume information is changing faster than ever, and that's creating new opportunities for platforms like ours. VerticalScope's communities deliver exceptional depth of expertise and engagement. As AI reshapes the digital landscape, we're focused on scaling what makes us unique — building stronger relationships with our large base of direct users, broadening how we monetize our audiences, and deploying AI to enhance user experience. We have the assets, the talent, and the strategy to capture meaningful growth in the years ahead.' Financial Highlights for the Three Months Ended June 30, 2025 Revenue decreased 13% to $14.5M, primarily due to a decline in MAUs, which impacted programmatic advertising. This follows a period of record-high MAU in the prior year. ARPU increased 17%, supported by a 41% year-over-year increase in e-commerce revenue. Adjusted EBITDA was $4.3M, down 39%, representing a 30% margin (compared to 42% in Q2 2024), reflecting lower revenue and increased investments in AI and traffic diversification. Operating Cash Flow increased 4% to $6.4M, inclusive of non-cash working capital changes from acquisitions. Free Cash Flow totaled $3.7M, reflecting 87% conversion of Adjusted EBITDA. Available Liquidity was $64.1M, comprised of $8.1M in unrestricted cash and $56.0M of undrawn revolver capacity. Net loss was $1.8M, compared to net income of $0.4M in the prior year, primarily due to lower revenue and $1.6M in one-time personnel and acquisition costs, partially offset by income tax recovery. 'Q2 demonstrated our ability to execute effectively while delivering a healthy Free Cash Flow conversion of 87% and a 30% Adjusted EBITDA margin,' said Vince Bellissimo, CFO of VerticalScope. 'Supported by a strong balance sheet and an efficient operating model, we continue to invest strategically in key initiatives that drive long-term value creation for our shareholders as we move into the second half of the year.' Earnings Conference Call and Webcast Management will host a conference call and webcast to discuss the Company's financial results at 7 a.m. ET on Wednesday, August 13, 2025. Live Call Registration and Webcast: Joining Live by Telephone: Canada: 1 833 950 0062 United States: 1 833 470 1428 Participant Access code: 628663 If you are unable to join live, an archived recording of the webcast will be available at: About VerticalScope Holdings Inc. Founded in 1999 and headquartered in Toronto, Ontario, VerticalScope is a technology company that has built and operates a cloud-based digital platform for online enthusiast communities in high consumer spending categories. VerticalScope's mission is to enable people with common interests to connect, explore their passions, and share knowledge about the things they love. Through targeted acquisitions and development, VerticalScope has built a portfolio of over 1,200 online communities and approximately 100 million monthly active users. Forward-Looking Statements This news release contains forward-looking information within the meaning of applicable securities legislation that reflects the Company's current expectations regarding future events. When used in this news release, words such as 'should', 'could', 'intended', 'expect', 'plan' or 'believe' and similar expressions indicate forward-looking statements. Forward-looking information, including the Company's plans for organic growth, deployment of capital, investments in our platform, the growth of revenue and MAU, information regarding our financial position, business strategy, growth strategies, addressable markets, budgets, operations, financial results, plans and objectives, is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond the Company's control. Although the Company believes that its expectations reflected in these forward-looking statements are reasonable, such statements involve risks and uncertainties and no assurances can be given that actual results will be consistent with these forward-looking statements. Such risks and uncertainties include, but are not limited to, the implementation and effectiveness of the Company's capital allocation strategy, the availability of high-quality M&A opportunities, dependence on search algorithms and third-party traffic sources, potential disruption from artificial intelligence technologies, and the factors discussed under "Risk Factors" in the Company's Annual Information Form dated March 31, 2025, which is available on the Company's profile on SEDAR Plus at Actual results could differ materially from those projected herein. VerticalScope does not undertake any obligation to update such forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required under applicable securities laws. Non-IFRS Measures This press release references certain non-IFRS measures, including Adjusted EBITDA and Free Cash Flow, and Free Cash Flow Conversion as described below. This press release also makes reference to MAU, which is an operating metric used in our industry. These non-IFRS measures are not recognized measures under IFRS and do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of the Company's results of operations from management's perspective. Accordingly, these measures should not be considered in isolation nor as a substitute for analysis of the Company's financial information reported under IFRS. The Company uses non-IFRS measures including: 'EBITDA' is calculated as net income (loss) excluding interest, income tax expense (recovery), and depreciation and amortization. 'Adjusted EBITDA' is calculated as EBITDA adjusted for share-based compensation, share performance related bonuses, unrealized gains or losses from changes in fair value of derivative financial instruments, severance, adjustments to contingent consideration liabilities measured at fair value through profit and loss, gain or loss on sale of assets, gain or loss on sale of investments, foreign exchange loss (gain), realized and unrealized other loss (gain) and other charges that include direct and incremental business acquisition related costs. 'Adjusted EBITDA Margin' measures Adjusted EBITDA as a percentage of revenue. 'Free Cash Flow' means Adjusted EBITDA less capital expenditures and income taxes paid during the period. 'Free Cash Flow Conversion' is equal to Free Cash Flow for the period divided by Adjusted EBITDA for the period. 'Monthly Active Users' ('MAU') is defined as the number of individuals who have visited our communities within a calendar month, based on data as measured by Google Analytics. To calculate average MAU in a given period, we sum the total MAU for each month in that period, divided by the number of months in that period. SOURCE VerticalScope Holdings Inc. Related Links The following table sets forth a reconciliation of Adjusted EBITDA and Free Cash Flow to net income (loss): (Unaudited) Three Months Ended June 30, Six Months Ended June 30, (in thousands of US dollars) 2025 2024 2025 2024 Net income (loss) ($1,792) $423 ($4,208) ($561) Net interest and financing expense 816 1,075 1,563 2,238 Income tax expense (recovery) (935) 556 (1,389) 431 Depreciation and amortization 4,830 4,501 9,254 9,066 EBITDA 2,918 6,555 5,220 11,173 Share-based compensation (124) 368 1,128 789 Share performance related bonus (1) — — — (3) Unrealized loss (gain) from changes in derivative fair value of financial instruments (139) 19 (188) 75 Severance (2) 1,121 — 1,120 — Other income (2) — (2) — Gain on sale of assets (3) (1) (3) (5) Gain on sale of investments — — — (16) Foreign exchange loss 17 — 73 28 Realized other loss 26 — 94 — Unrealized other loss (26) — — — Other charges (3) 509 135 497 262 Adjusted EBITDA 4,299 7,076 7,940 12,302 Less capital expenditures (266) (399) (711) (834) Income taxes received (paid) (287) (120) (362) 258 Free Cash Flow $3,746 $6,557 $6,866 $11,726 (1) Share performance related bonus is included in wages and consulting on the condensed consolidated interim statements of income (loss) and comprehensive income (loss). (2) Severance is included in wages and consulting on the condensed consolidated interim statements of income (loss) and comprehensive income (loss). (3) Other charges are included in wages and consulting and general and administrative on the condensed consolidated interim statements of income (loss) and comprehensive income (loss). For the three months ended June 30, 2025, these charges include direct and incremental business acquisition related costs. June 30, December 31, Assets Current assets: Cash $8,143,612 $5,189,315 Restricted cash 102,967 97,244 Trade and other receivables 11,533,480 14,874,882 Lease receivable 49,302 326,267 Income taxes receivable 822,621 784,332 Prepaid expenses 886,005 761,652 Derivative instruments 43,140 — 21,581,127 22,033,692 Property and equipment 349,587 482,276 Right-of-use asset 1,288,772 1,564,687 Intangible assets 38,961,754 37,597,990 Goodwill 52,635,164 52,635,164 Other assets 144,288 154,497 Deferred tax asset 19,174,931 17,937,708 Total assets $134,135,623 $132,406,014 Liabilities and Shareholders' Equity Current liabilities: Accounts payable and accrued liabilities $8,574,197 $6,864,256 Income taxes payable 224,015 426,778 Derivative instruments — 145,068 Deferred revenue 1,394,824 1,125,592 Current portion of long-term debt 646,004 687,875 Lease liability 683,650 946,626 11,522,690 10,196,195 Long-term debt 44,000,000 38,000,000 Lease liability 936,673 1,180,878 Deferred tax liability 7,585 315,607 Other long-term liabilities 26,612 26,612 Total liabilities 56,493,560 49,719,292 Shareholders' equity: Share capital 158,703,767 163,250,013 Contributed surplus 22,552,185 25,413,119 Other comprehensive loss (145,494) (145,494) Deficit (103,468,395) (105,830,916) 77,642,063 82,686,722 Total liabilities and shareholders' equity $134,135,623 $132,406,014 VERTICALSCOPE HOLDINGS INC. Condensed Consolidated Interim Statements of Income (Loss) and Comprehensive Income (Loss) (In U.S. dollars, except per share amounts) (Unaudited) Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Operating expenses: Wages and consulting 8,276,004 6,822,678 15,438,208 13,762,711 Share-based compensation (124,142) 367,575 1,127,851 788,816 Platform and technology 2,074,497 1,675,344 3,714,095 3,218,879 General and administrative 1,382,546 1,268,179 2,443,011 2,460,804 Depreciation and amortization 4,830,349 4,500,984 9,253,924 9,065,612 16,439,254 14,634,760 31,977,089 29,296,822 Operating income (loss) (1,898,938) 2,052,756 (3,871,256) 2,114,138 Other expenses (income): Other income (1,824) — (1,824) — Gain on sale of assets (2,601) (1,098) (2,941) (4,718) Net interest and financing expense 815,644 1,074,882 1,563,462 2,237,814 Gain on sale of investments — — — (16,398) Foreign exchange loss 17,385 261 73,040 27,641 Realized other loss 26,453 — 94,030 — Unrealized other loss (26,453) — — — 828,604 1,074,045 1,725,767 2,244,339 Income (loss) before income taxes (2,727,542) 978,711 (5,597,023) (130,201) Income tax expense (recovery) Current (255,579) 163,747 155,905 252,365 Deferred (679,785) 391,866 (1,545,241) 178,929 (935,364) 555,613 (1,389,336) 431,294 Net income (loss) ($1,792,178) $423,098 ($4,207,687) ($561,495) Other comprehensive income (loss) Items that may be reclassified to net income (loss): Foreign currency differences on translation of foreign operations — (13,399) — 12,846 Total comprehensive income (loss) ($1,792,178) $409,699 ($4,207,687) ($548,649) Earnings (loss) per share: Basic ($0.08) $0.02 ($0.19) ($0.03) Diluted (0.08) 0.02 (0.19) (0.03) VERTICALSCOPE HOLDINGS INC. Condensed Consolidated Interim Statements of Cash Flows (In U.S. dollars) (Unaudited) Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Cash provided by (used in): Operating activities: Net income (loss) ($1,792,178) $423,098 ($4,207,687) ($561,495) Items not involving cash: Depreciation and amortization 4,830,349 4,500,984 9,253,924 9,065,612 Net interest and financing expense 815,644 1,074,882 1,563,462 2,237,814 Gain on sale of assets (2,601) (1,098) (2,941) (4,718) Gain on sale of investments — — — (16,398) Unrealized loss (gain) in derivative instruments (138,557) 19,035 (188,208) 74,703 Unrealized other gain (26,453) — — — Income tax expense (recovery) (935,364) 555,613 (1,389,336) 431,294 Share-based compensation (124,142) 367,575 1,127,851 788,816 2,626,698 6,940,089 6,157,065 12,015,628 Change in non-cash operating assets and liabilities 4,792,347 414,915 5,027,900 1,858,879 Interest paid (690,393) (1,070,476) (1,414,940) (2,233,328) Income taxes received (paid) (287,300) (119,557) (362,330) 257,529 6,441,352 6,164,971 9,407,695 11,898,708 Financing activities: Repayment of term loan — (625,000) — (1,250,000) Proceeds from issuance of revolving loan 3,000,000 — 6,000,000 — Repayment of revolving loan — (5,875,000) — (8,250,000) Cash settlement for vested RSUs (119,753) — (119,753) — Repurchase of share capital for cancellation (1,845,070) (435,859) (1,845,070) (669,085) Lease payments (232,372) (340,661) (555,651) (701,643) Proceeds from sublease 138,002 147,878 278,942 297,956 940,807 (7,128,642) 3,758,468 (10,572,772) Investing activities: Additions to property and equipment and intangible assets (268,712) (399,007) (714,654) (833,618) Proceeds from sale of assets 2,601 1,967 2,941 6,081 Proceeds from sale of investments — — — 16,398 Acquisitions (4,038,028) (200,178) (9,494,430) (200,178) Increase (decrease) in cash 3,078,020 (1,560,889) 2,960,020 314,619 Cash, beginning of period 5,014,293 7,908,036 5,189,315 6,015,184 Change in restricted cash balances (9,052) (3,287) (5,723) 979
The Verge
26-06-2025
- The Verge
AI is ruining houseplant communities online
'Maybe you could organize your plants like this,' my friend's text message said, with an attached photo of white pots of plants floating midair in front of a huge, sunny window. As a newbie plant collector, I do need to organize my growing collection of flora, but not like this — the photo was AI-generated and the plants depicted were not real. Even as a beginner, I was able to identify issues with the photo. Obviously, my plants cannot physically defy gravity, but most egregiously, the organizational method of putting plants in direct sunlight would completely incinerate their leaves. This was the first time I came across AI-generated plant content from well-meaning people who earnestly believe it is real, but its proliferation is a growing problem in plant-lover communities online and off. While online retailers have often scammed less-knowledgeable consumers, the rise of online stores using AI-generated photos of fake, usually vibrant, and otherworldly-looking plants to fool consumers into buying seeds for plants that do not exist has been remarked upon by multiple plant-specific blogs, podcasts, and communities in the last three years. The offer of pink pastel monstera seeds, a variation of a favorite houseplant that cannot be real because of the species' lack of pink pigment genes, is a common scam online, with even Google's AI assistant confirming its existence. AI-generated photos of bright red and blue hostas also often advertise seeds, but pigment genes that generate these vibrant colors do not exist, and hostas grown from seeds usually inherit unpredictable traits from their two parent plants. Even if these pigment genes existed, there would be no guarantee that you could feasibly create these plants from seeds. 'In the springtime we get customers asking about AI-generated plants multiple times a week,' says Casey Schmidt Ahl, engagement manager at the Colonial Gardens, a garden center in Phoenixville, Pennsylvania, who has published a blog post teaching plant owners how to spot fake AI plant scams online. 'We always make sure that we tell them that it is an AI-generated — or at least heavily photoshopped — image, and that they need to be really careful because we know that if we just say we don't have it, they are more likely to just go online and buy it.' According to the post written by Ahl, one customer called in asking about a black bleeding heart plant. Ahl only had bleeding hearts — which have hanging petals that look like hearts dripping in liquid — in white and pink, so she searched for the black version online. The red flags were there: there was only one image of the plant across multiple websites, and there wasn't specific information about the plant's growth or variety. Plant care misinformation regurgitated by AI chatbots and apps is also a common occurrence, according to Ahl. Plant care has always involved folklore and pseudoscience, Ahl explains, like dipping leaf cuttings into honey to help them grow roots or using cinnamon to heal plant wounds. AI is now a part of a larger misinformation ecosystem that includes plant influencers without cited sources repeating plant care myths and plant ID apps. When Ahl writes articles for the Colonial Gardens blog, she uses scholarly papers and growers' guides as sources, but she says it is unclear where an AI-powered bot like ChatGPT is pulling its information from. 'It's always important for us to be able to ground our advice in science,' Ahl says, adding that garden centers have already fallen behind the curve of connecting with clients because of plant influencers on social media who are able to go viral quickly but rarely cite scientific studies. Ahl sees AI-generated misinformation as a part of an ecosystem that discourages plant owners from talking to an expert face-to-face. 'It's disconnecting us further from reality, relationships with nature, and also our community.' Ahl isn't the only one who feels this way. Most plant communities on Reddit ban AI-generated images, and there are strong feelings against AI-generated plant care advice, which some community members say is often wrong and doesn't take the human variable into account. Plant care can vary according to where the plant owner lives, whether the plant owner is a beginner or more experienced collector, and the gardening supplies that are immediately available. But most importantly, AI-generated content — both photos of fake plants and care misinformation — disrupt community engagement, which is what many collectors are seeking when joining these forums. 'Most people are looking to socially connect based on real lived experiences, in a community with others like you, otherwise it would be easier to simply Google a question for answers,' says Redditor known as Caring_Cactus, who moderates four plant-related subreddits, in a written interview. Moderators also struggle with AI automated content that is posted in large volumes by bots. 'They create a lot of generic responses that are full of false information. Most people also view it as lazy and disingenuous with ulterior motives.' This kind of content is 'discouraging any meaningful engagement' because it's not grounded in reality, Caring_Cactus continues. 'They're trying to farm attention with low quality content, and it creates less opportunities for real connection by wasting people's precious time when they want to socialize online.' There are also more existential issues that arise from AI-generated plants, as fake photos and AI-generated care hacks might take away the wonder of how special being a part of the growth and development of real plants can be. 'There's a lot of different reasons that people garden, including supporting wildlife and pollinators with native plants or growing their own food, and these AI images and scams are not really interested in connecting you with a broader goal,' Ahl says. Instead, this content wants to catch your attention through 'a curiosity dopamine sort of response,' Ahl says, or even try to scam you into buying seeds for blue sunflowers. Additionally, the use of AI-powered apps in gardening, where plants and the issues that might be killing them are identified through photos, is like taking a shortcut, which defeats the whole point of the hobby. 'If instead of looking at your plants and making sure that they're watered correctly or reaching out to an expert, you always just take a picture with your AI app and have it tell you what's wrong, you are letting AI do the thinking for you and you're not doing the full connection and the mindfulness of having plants,' Ahl adds. AI-generated plant slop might also make magical-looking real plants look fake, risking the destruction of the wonder collectors feel toward new plant varieties. 'This year they debuted the firefly petunia, which is a glow-in-the-dark petunia,' Ahl says, adding that, admittedly, this sounds like something that shouldn't exist. The proliferation of AI-generated photos has resulted in an existential questioning of reality, and it might be driving us even further away from nature. 'It definitely draws away from the majesty of plants because there are certainly lots of existing varieties that are amazing without having a galaxy pattern on their petals.'
Yahoo
26-06-2025
- Yahoo
Reddit vows to stay human to emerge a winner from artificial intelligence
Reddit is in an 'arms race' to protect its devoted online communities from a surge in artificial intelligence-generated content, with the
The Sun
10-06-2025
- The Sun
My sister took her own life after making sick pact with online chat room stranger who flew over from US to watch her die
A WRITER has described how a man flew from the US to watch her sister take her own life after meeting on a "sick" online forum. Adele Zeynep Walton, 26, told how her sister Aimee was discovered dead by cops in a hotel room in October 2022. 5 5 5 Aimee, who was just 21-years-old at the time, was found with a total stranger, who had flown from the US to watch her die. The sisters - who were raised in Southampton, Hampshire, both had active online lives growing up, but Aimee more so. Adele said that Aimee, who was neurodivergent, was bullied as a teenager and turned to online communities instead. When the pandemic hit, Aimee withdrew even further into the online world, her sister - writing in The Telegraph - explained. She broke up with her boyfriend and spent an increasing amount of time in her room. The first Covid lockdown in England was announced in March 2020, and the third was on January 2021. It was in October 2022 that Adele - who was 25 at the time - and her parents were told that Aimee was dead. Aimee was found in a hotel room in Slough, Berkshire, 60 miles away from her home - with a stranger. They had met through a sick online forum that "partners" up people looking to end their own lives. This forum was also how she got her hands on the substance that killed her - reportedly from Kenneth Law, who has been linked to 88 deaths in the UK. According to The New York Times, the forum was founded by two men who run several "incel" websites. Adele took it upon herself to visit the thread and said many of the posts said: "Your family don't care about you" and "You should do it." She told The Guardian that the man who was with her little sister could have been "living out a sick fantasy as an incel who wants to see a young and vulnerable woman end her life'. The man told police he had been working for the 11 days he spent in the hotel room with Aimee. Adele wrote in The Telegraph: "This forum has taken at least 50 UK lives, including my sister. "From looking at the forum myself, I can see just how easy it is to end up in a rabbit hole of despair, where vulnerable users are told their loved ones don't care about them. "Being informed by police that Aimee died in a hotel room with a stranger who she met on this forum, and who flew from the US to witness her death, still haunts me." Adele now campaigns about the harms of the online world and has written a book called Logging Off: The Human Cost of Our Digital World. If you are affected by any of the issues raised in this article, please call the Samaritans for free on 116123. 5 5
Yahoo
07-06-2025
- Health
- Yahoo
18 Unhinged, Crunchy Parents Who Held Nothing Back When Posting Online
I'm sorry, but online parenting groups are out of control, and we need to talk about it. Instead of providing parents with a positive online forum and community, these groups tend to devolve into toxic echo chambers brimming with misinformation, bad advice, and brain rot. Here are 18 screenshots to prove it: mom who wants other mom friends, but only if they're upper-middle class: absolutely shameless weirdo who proves you really can't trust anyone: person who spouted dangerous nonsense online: overstepping grandparent who needs to be kept far away from this baby: grossly judgmental parent who is going to give their child body images issues for life: parent who harshly called their first child bad simply because they developed at a slower rate than their second child: parent who is feverishly obsessed with pushing essential oils on their 16-year-old son: parent who thinks scaring the hell out of their 4-year-old is an acceptable technique: commenter who must suffer from serious brain rot because they think it's suitable to use a child's pain as an opportunity for a parent to grow: parent who really, really wants to get their 10-week-old baby's ears pierced: parent who really doesn't see how leaving their children alone in a car for half an hour is dangerous: poster who wants to skip an important doctor's appointment for their baby, and a commenter who thinks asking ChatGPT is as good as receiving medical care: anti-vax parent who wants to protect their kids from whooping not enough to vaccinate them: stepmother who was upset that their stepchild was sick and "ruined" their Mother's Day: expecting parent who spoke to a doctor and needs medical care, but rather consult randos on Facebook: person who seems more concerned with the aesthetic of their homebirth than making sure it's safe: parent who wants specialized care for their child who keeps getting kicked out of daycare, but refuses to pay fairly for such care: finally, this parent who is drinking all sorts of internet Kool-Aid: H/T: r/ShitMomGroupsSay
