Direct Digital Holdings, Inc. (DRCT) reported that its subsidiary Direct Digital Holdings, LLC entered into a Thirteenth Amendment to its Term Loan and Security Agreement with Lafayette Square USA, Inc. as lender. The amendment adds a new $695,000 term loan maturing on October 12, 2026, to fund a $15,000 interest reserve and for general corporate and working capital purposes.
The new term loan bears the same interest rate as existing term loans and is amortized through weekly principal payments of at least $20,000 for the week of August 31, 2026 and at least $100,000 per week from the week of September 7, 2026 through the week of October 5, 2026, with a final $175,000 payment at maturity. It is subject to the same mandatory prepayment and acceleration-on-default provisions as the existing facility. The amendment also confirms prior waiver deadlines and adds a new financial covenant related to cash flow variances. After giving effect to this amendment, $15.5 million of term loans are outstanding under the Term Loan Facility.
Direct Digital Holdings, Inc. (DRCT) reports that its subsidiary Direct Digital Holdings, LLC entered into a Waiver Letter on August 18, 2026 with its term loan administrative agent and lender. The waiver covers noncompliance with several financial covenants for the quarter ended June 30, 2026, including minimum unrestricted cash, consolidated total leverage ratio, consolidated fixed charge coverage ratio and minimum consolidated EBITDA requirements, and waives nonpayment of interest for the months ended May 31, June 30 and July 31, 2026. It also defers payment of certain Twelfth Amendment fees and August 2026 interest to September 30, 2026 and waives minimum unrestricted cash and certain refinancing and preferred transaction requirements through August 31, 2026.
Separately, the Nasdaq Hearings Panel granted DRCT an extension of its August 14, 2026 deadline to address the minimum stockholders’ equity requirement under Nasdaq Listing Rule 5550(b)(1). The company must update the Panel by September 15, 2026 on progress toward compliance; its Class A Common Stock continues trading on The Nasdaq Capital Market under “DRCT”, but there is no assurance of continued listing.
Direct Digital Holdings, Inc. reported lower activity for the quarter and six months ended June 30, 2026. Revenues were $7.8 million for the quarter and $14.5 million year‑to‑date, down from $10.1 million and $18.3 million in 2025, reflecting reduced advertising volumes.
The company posted a quarterly net loss of $3.6 million and a six‑month net loss of $9.2 million, with net loss attributable to the company of $8.6 million year‑to‑date. Cash was $0.5 million, total assets $18.9 million, total liabilities $32.7 million, and stockholders’ deficit $13.8 million, including a working capital deficit of $27.5 million.
Total debt was $17.7 million, largely under the 2021 Credit Facility, with $17.3 million classified as current. Management disclosed substantial doubt about the ability to continue as a going concern due to losses, covenant noncompliance, Nasdaq stockholders’ equity deficiencies, significant obligations maturing in December 2026, and limited cash, while pointing to cost reductions, debt conversions to Series A Convertible Preferred Stock, and equity facilities as key mitigation efforts.
Direct Digital Holdings, Inc. reported weaker results for the quarter and six months ended June 30, 2026. Second-quarter revenue was $7.8 million, down 23% from $10.1 million, mainly due to a $2.5 million reduction in spending by demand side platform (DSP) customers. Excluding DSP revenue, second-quarter revenue grew 3%, and first-half 2026 revenue excluding DSP increased 5% versus 2025, reflecting stronger performance in the core business.
Gross margin was 34% in both the quarter and first half. Operating expenses declined 7% in the quarter and 10% year-to-date, but Adjusted EBITDA loss widened to $2.3 million in the quarter and $4.9 million for the first half. Net loss improved modestly to $3.6 million in the quarter and $9.2 million for the first half. Operating cash outflow for the first half improved to $1.9 million from $5.4 million a year earlier.
Liquidity and leverage remain key concerns. As of June 30, 2026, the company held $0.5 million in cash against current maturities of related-party long-term debt of $17.3 million and total stockholders’ deficit of $13.8 million. Management disclosed noncompliance with certain financial covenants under its credit facility and is seeking a waiver while focusing on liquidity and strategic growth initiatives, including AI-based offerings.
Direct Digital Holdings, Inc. held its 2026 Annual Meeting of Stockholders on July 31, 2026, where stockholders representing 425,635 votes, or approximately 51% of the 834,910 votes entitled to be cast, were present, constituting a quorum. Six directors were elected to serve until the 2027 annual meeting, and BDO USA, P.C. was ratified as independent registered public accounting firm for the year ending December 31, 2026.
Stockholders also approved an amendment to the Company’s 2022 Omnibus Incentive Plan, increasing the number of shares of Class A Common Stock issuable under the plan by 1,200,000 shares. The amendment had been previously approved by the Board of Directors subject to stockholder approval and became effective upon that approval.
Direct Digital Holdings director Antoinette Renee Leatherberry reported routine equity compensation activity and related tax sales. She exercised restricted stock units that converted into 286 shares of Class A Common Stock at a conversion price of $0.00 per share, reflecting vesting of prior grants. On June 9, 2026 and June 12, 2026, 90 shares were sold at prices between $2.91 and $2.96, with footnotes stating these shares were sold solely to satisfy tax liabilities from the RSU vesting. After these transactions, she directly owned 531 shares of Class A Common Stock, with all amounts adjusted for the company’s prior reverse stock splits.
Direct Digital Holdings director Richard Cohen reported a combination of RSU vesting, share issuances, and related share sales. On June 9 and June 12, 2026, he sold a total of 101 shares of Class A Common Stock at prices of about $2.96 and $2.91 per share. Footnotes state these shares were sold solely to satisfy tax liabilities from vesting restricted stock units.
Cohen also exercised restricted stock units converting into 286 Class A shares on those dates and on January 24, 2026, at a stated conversion price of $0.00 per unit on a one-for-one basis. After giving effect to completed 55-to-1 and 4-to-1 reverse stock splits and these transactions, he beneficially owns 501 Class A shares directly.
Direct Digital Holdings Chief Technology Officer Anu Pillai reported routine equity compensation activity, mainly RSU vesting and a new stock option grant. On January 24, 2026, March 20, 2026, and April 1, 2026, restricted stock units converted into a total of 145 shares of Class A common stock, with 53 shares withheld to cover tax liabilities rather than sold on the market.
Separately, on March 24, 2026, Pillai received 4,375 employee stock options with a $3.32 exercise price, scheduled to vest in three equal annual installments beginning on March 24, 2027 and expiring on March 24, 2036. After the latest reported transaction, Pillai directly holds 189 shares of Class A common stock. All share and option amounts were adjusted to reflect a 55-to-1 reverse stock split on January 12, 2026 and a 4-to-1 reverse stock split on April 27, 2026.
Direct Digital Holdings director and CEO Mark D. Walker reported several routine equity transactions. On June 12, 2026, AJN Energy & Transport Ventures, LLC, an entity associated with him, sold 1,363 shares of Class A common stock in an open-market trade under a pre-arranged Rule 10b5-1 plan at a weighted average price of $2.80 per share. Earlier in 2026, restricted stock units vested and were converted into small blocks of common shares, with 95 shares withheld across multiple dates to cover tax liabilities. Walker also received an award of 8,750 employee stock options with an exercise price of $3.32 per share expiring in 2036, providing additional long-term equity exposure. As of the latest reported dates, he held a modest number of shares directly, while the LLC’s reported indirect holding for this transaction was reduced to zero.
Direct Digital Holdings, Inc. President W. Keith Smith reported routine equity compensation activity, including restricted stock unit (RSU) vesting, related tax withholding, and a new stock option grant. On January 24, 2026, he exercised 204 RSUs into Class A Common Stock and 61 shares were withheld to cover tax liabilities, leaving 505 directly held shares. On March 20, 2026, he exercised 45 additional RSUs into shares, with 14 shares withheld for taxes, and on April 1, 2026, 67 RSUs vested into shares at an adjusted price of $3.29 per share, bringing his direct holdings to 542 shares. Separately, on March 24, 2026, he received an award of 8,750 employee stock options with a $3.32 exercise price, scheduled to vest in three equal annual installments beginning on March 24, 2027. The filing also shows 2,114 shares of Class A Common Stock held indirectly through SKW Financial LLC. Share and award amounts have been adjusted to reflect prior reverse stock splits.