KUSTOM ENTERTAINMENT, INC. ANNOUNCES THIRD QUARTER OPERATING RESULTS

The quarter's net profit included divestiture income, while continuing operations posted a wider loss than a year earlier.

Rhea-AI Summary

Kustom Entertainment (NASDAQ: KUST) reported third-quarter revenue from continuing operations of $2.7 million, up 57% from the prior-year quarter. Net income attributable to common stockholders was $2,346,315, or $4.51 per share, versus a $1,021,867 loss. Income from discontinued operations was $5,017,203, reflecting the gain on the video solutions divestiture to Cycurion, completed August 3, 2026. The continuing-operations loss widened to $2,670,888 from $994,761.

At September 30, equity was $7,852,961, versus $2,369,956 at year-end 2025; liabilities fell to $7.7 million from $17.0 million. Cash rose to $1,715,820 from $757,369. Shareholders approved the proposed TFL acquisition on October 5; its outside date was extended to December 18, 2026 while financing remains unfinished. The company plans to move its 2027 Country Stampede festival to Gilley’s Park City, with nearly double the venue capacity.

15 points · 1 major

PositiveiHow this balance works

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It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.

Rhea-AI Sentiment measures something else, the tone of the wording.

How the balance worksHow Sentiment works

0 major · 3 points

Hollow bars mark forward-looking points. How the balance works

Positive

• Major pointDiscontinued-operations income was $5,017,203, reflecting the gain on the completed video solutions divestiture. 2.3× market cap
• Moderate pointContinuing-operations revenue increased 57% year over year to $2.7 million in the third quarter.
• Moderate pointStockholders’ equity more than tripled to $7,852,961 at September 30 from $2,369,956 at year-end 2025.
• Moderate pointTotal liabilities declined $9.3 million to $7.7 million from $17.0 million at year-end 2025.
• Moderate pointCash and cash equivalents rose to $1,715,820 at September 30 from $757,369 at year-end 2025.
• Moderate pointWorking capital, excluding discontinued-operations current assets and liabilities, improved $3.2 million from year-end 2025.
• Moderate pointProposed TFL acquisition received shareholder approval on October 5, 2026.

8 minor points

• Minor pointService revenue grew 65% to $2.1 million, principally driven by TicketSmarter transaction volume.
• Minor pointProduct revenue grew 32% to $575,067 on higher ticket inventory sales.
• Minor pointGross profit increased 10% to $208,949 from $189,673 in the prior-year quarter.
• Minor pointNet income attributable to common stockholders reached $2,346,315 versus a prior-year quarterly loss of $1,021,867.
• Minor pointCycurion sale consideration includes a $4.25 million, 7% secured note and $600,000 in 12% cumulative preferred stock.
• Minor point. Forward-looking: it has not happened yet and may not happen.2027 Country Stampede relocation is planned for Gilley’s Park City, with nearly double the venue capacity.
• Minor point. Forward-looking: it has not happened yet and may not happen.2027 live event schedule continues to expand under the company’s plans.
• Minor point. Forward-looking: it has not happened yet and may not happen.Margin expansion is expected by management as TicketSmarter scales following customer acquisition and marketing investments.

Negative

• Moderate pointContinuing-operations loss widened to $2,670,888 from $994,761 in the prior-year quarter.
• Moderate pointApproximately $625,000 in non-cash expense involved common stock issued for consulting, acquisition-related costs and collaborative arrangements. 28% of market cap
• Moderate pointTFL acquisition financing remains unfinished; the November 6 amendment extended the outside date to December 18, 2026.

News Explained

The sale also left Kustom holding a $4.25 million, 7% secured Cycurion promissory note and $600,000 of 12% cumulative Series H preferred stock, received as part of the sale transaction.

Key Figures

Continuing-operations revenue: $2.7 million (+57%) Net income attributable to common stockholders: $2,346,315 ($4.51 per basic and diluted share) Income from discontinued operations: $5,017,203 +5 more

Continuing-operations revenue

$2.7 million (+57%)

Q3 2026; compared with $1.7 million in Q3 2025

Net income attributable to common stockholders

$2,346,315 ($4.51 per basic and diluted share)

Q3 2026; includes income from discontinued operations

Income from discontinued operations

$5,017,203

Q3 2026; reflects the net gain on the legacy video solutions business divestiture

Loss from continuing operations

$2,670,888 ($5.13 per share)

Q3 2026

Stockholders’ equity

$7,852,961

As of September 30, 2026; compared with $2,369,956 at December 31, 2025

Total liabilities

$7.7 million

As of September 30, 2026; down $9.3 million from year-end 2025

Cash and cash equivalents

$1,715,820

As of September 30, 2026; compared with $757,369 at December 31, 2025

TFL acquisition outside date

December 18, 2026

Purchase agreement amended while the company works to complete financing

Historical Context

2 past events · Latest: Sep 01

2 events

1. Sep 01

   TFL acquisition

   24h Move

   +4.4%

   Definitive agreement covered the full TFL equity purchase, cash and stock consideration, and financing conditions.

2. Sep 03

   TFL roadmap

   24h Move

   -0.4%

   TFL reported more than $238 million in 2025 revenue across five ticketing and event-service pillars.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Key Terms

form 10-q, discontinued operations, secured promissory note, basic and diluted share

4 terms

form 10-q regulatory

"filed its Quarterly Report on Form 10-Q for the three and nine months"

A Form 10-Q is a detailed report that publicly traded companies are required to file with regulators three times a year, providing an update on their financial health and business activities. It is important for investors because it offers timely insights into a company's performance, helping them make informed decisions about buying or selling stocks. Think of it as a regular check-up report that shows how well a company is doing.

discontinued operations financial

"Income from discontinued operations was $5,017,203"

Discontinued operations are parts of a company that it has decided to sell or shut down, and no longer plans to run in the future. This matters to investors because it helps them understand which parts of the business are ongoing and which are being phased out, providing a clearer picture of the company’s current performance and future prospects. Think of it like a store closing a department—it no longer contributes to sales or profits.

secured promissory note financial

"a $4.25 million, 7% secured promissory note"

A secured promissory note is a written promise to repay borrowed money that is backed by specific assets pledged as collateral; if the borrower fails to pay, the lender can seize those assets to recover losses. Investors care because the collateral reduces the lender’s risk and can make the loan safer and more likely to be repaid, similar to a pawnshop loan where an item lowers the lender’s exposure if the borrower defaults.

basic and diluted share financial

"or $4.51 per basic and diluted share"

Basic shares are the actual number of company shares currently outstanding, while diluted shares add in any securities that could become shares in the future (like options, warrants or convertibles), showing a potential larger share count. Think of a pie that’s already sliced versus the same pie if extra people claim future slices; diluted shares show the “worst-case” slice size and help investors judge per-share earnings and ownership dilution.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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REVENUE UP 57%, NET INCOME REACHES $2.3 MILLION AND STOCKHOLDERS’ EQUITY MORE THAN TRIPLED SINCE YEAR END 2025 AS THE COMPANY CONTINUES ITS TRANSFORMATION INTO A PURE-PLAY LIVE ENTERTAINMENT AND TICKETING COMPANY

Olathe, KS, Nov. 10, 2026 (GLOBE NEWSWIRE) -- Kustom Entertainment, Inc. (NASDAQ: KUST) (the “Company”), a live event production and ticketing technology company, today announced that it has filed its Quarterly Report on Form 10-Q for the three and nine months ended September 30, 2026 with the SEC.

The third quarter marked the Company’s first as a pure-play live entertainment and ticketing enterprise, following the completed sale of its legacy video solutions business to Cycurion, Inc. on August 3, 2026. Results reflect strong top-line revenue growth, positive net income for the quarter and a substantially strengthened balance sheet compared with December 31, 2025.

Third Quarter Financial & Highlights:

• Revenue Growth: Total third quarter revenue from continuing operations increased 57% to $2.7 million, compared with $1.7 million in the third quarter of 2025.

• • Service Revenue: Grew 65% to $2.1 million, driven principally by transaction volume on the TicketSmarter marketplace.
  • Product Revenue: grew 32% to $575,067 on higher ticket inventory sales.

• Gross Profit: increased 10% to $208,949, compared with $189,673 in the prior-year period, on higher overall transaction volume.
• Net Income: Net income attributable to common stockholders reached $2,346,315, or $4.51 per basic and diluted share, compared with a net loss of $1,021,867, or $(88.73) per share, in the third quarter of 2025.
• Discontinued Operations: Income from discontinued operations was $5,017,203 reflecting the net gain on the divestiture of the legacy video solutions business.
• Continuing Operations: Loss from continuing operations was $2,670,888, or $(5.13) per share, compared with $(994,761), or $(86.38) per share, in the prior-year period. Approximately $625,000 of the increase was non-cash expense for common stock issued for consulting, acquisition-related costs and collaborative arrangements; The balance reflects the Company’s deliberate investment in customer acquisition and marketing to drive TicketSmarter platform growth, which produced the 65% increase in service revenue noted above.
• Balance Sheet Strength:

• • Total stockholders’ equity more than tripled to $7,852,961 as of September 30, 2026, compared with $2,369,956 as of December 31, 2025.
  • Total liabilities declined by $9.3 million to $7.7 million (down from $17.0 million at year-end 2025).
  • Cash and cash equivalents increased to $1,715,820 as of September 30, 2026, compared with $757,369 as of December 31, 2025, and working capital, (excluding current assets and liabilities of discontinued operations) improved by $3.2 million.
  • The Company holds a $4.25 million, 7% secured promissory note and $600,000 in 12% Cumulative Series H preferred stock of Cycurion received as part of the video solutions sale transaction.
    
    

“The third quarter was our first full quarter operating exclusively as a live entertainment and ticketing company, and the results show the strength of the business we have built,” stated Stanton E. Ross, Chief Executive Officer of Kustom Entertainment, Inc. “A 57% revenue expansion in continuing operations, driven by surging TicketSmarter transaction volume and our 30th anniversary Country Stampede festival. We deliberately invested ahead of that growth in customer acquisition and marketing, and we expect those investments to translate into expanding margins as the platform scales.”

“With the sale of the video solutions business to Cycurion completed in August, following the sale of Nobility Healthcare at the start of the year, we have eliminated the overhead and working capital demands of our legacy operations,” Mr. Ross continued. “We emerged with a far stronger and cleaner balance sheet: Total liabilities are down over $9 million since year end, stockholders’ equity has more than tripled to $7.9 million, and the Cycurion note and preferred stock give us yield-bearing assets in place of legacy overhead,” Mr. Ross continued.

“Looking ahead, we are excited about the opportunity in front of us. On October 5, 2026, our stockholders approved the proposed acquisition of TFL, LLC, and on November 6, we amended the purchase agreement to extend the outside date to December 18, 2026 as we work to complete the financing. Acquiring TFL will bring a ticketing technology and inventory distribution business of substantial scale into Kustom. Concurrently, the 2027 Country Stampede Music Festival will move to Gilley’s Park City near Wichita, Kansas with nearly double our venue capacity, and we continue to build our schedule of live event days for 2027. I want to thank our employees, partners, directors and stockholders for their support through this transformation, and I look forward to reporting on our continued progress,” concluded Ross.

About Kustom Entertainment, Inc.:

Kustom Entertainment, Inc. (Nasdaq: KUST) specializes in large-scale live music festival production, event management, and ticketing technology solutions designed to maximize high-margin monetization across the entire live event lifecycle. For more information, visit www.kustoment.com.

Cautionary Statement Regarding Forward-Looking Statements:

Statements made in this press release that are not descriptions of historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and are based on management’s current expectations and assumptions and are subject to risks and uncertainties, including the ability of the parties to finalize closing requirements and satisfy all conditions to closing by the extended outside date of December 18, 2026. Such statements include, but are not limited to, statements regarding the anticipated closing of the transaction contemplated by the Unit Purchase Agreement; the Company’s growth strategy; the integration of the acquired business; the Company's plans to host events at the Gilley's facility and the 2027 Country Stampede Kansas; and other statements that are not historical facts. Words such as “continue,” “will,” “may,” “could,” “should,” “expect,” “expected,” “plans,” “intend,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” and similar expressions are intended to identify forward-looking statements. If such risks or uncertainties materialize or such assumptions prove incorrect, our business, operating results, financial condition, and stock price could be materially negatively affected. You should not place undue reliance on such forward-looking statements, which are based on the information currently available to us and speak only as of today’s date. All statements other than statements of historical fact are forward-looking statements. The Company assumes no duty to update forward-looking statements, except as required by law. Examples of such risks and uncertainties include, but are not limited to, risks related to the closing conditions of the Unit Purchase Agreement and obtaining required consents; the success of integrating new business; changes in consumer demand for live entertainment and the ability to host live events; or, the future performance of the Company’s common stock. Actual future results, performance or achievements may differ materially from historical results or those anticipated depending on a variety of factors, some of which are beyond the control of the Company, including, but not limited to, the risks described from time to time in the Company’s periodic filings with the U.S. Securities and Exchange Commission, including, without limitation, the risks described in the Company’s 2025 Annual Report on Form 10-K under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” (as applicable). These factors should be considered carefully, and readers are cautioned not to place undue reliance on such forward-looking statements. All information is current as of the date this press release is issued, and the Company undertakes no duty to update this information.

Media & Investor Contact:
Stanton E. Ross, CEO
Kustom Entertainment, Inc.
Phone: (913) 456-KUST (5878)
Email: info@kustoment.com
Website: www.kustoment.com

FAQ

AI-generated questions and answers. How Rhea-AI works. Not financial advice.

What were Kustom Entertainment’s third-quarter 2026 earnings per share?

Net income attributable to common stockholders was $4.51 per basic and diluted share, compared with a loss of $88.73 per share in the third quarter of 2025. Continuing operations lost $5.13 per share, compared with a loss of $86.38 per share a year earlier.

Why did Kustom Entertainment’s continuing-operations loss increase in the third quarter of 2026?

Approximately $625,000 of the increase was non-cash expense for common stock issued for consulting, acquisition-related costs and collaborative arrangements. The company attributed the balance to customer acquisition and marketing investment aimed at growing TicketSmarter.