Kidoz (OTC: KDOZF) grows ad sales but draws down cash
Rhea-AI Filing Summary
KIDOZ INC. (KDOZF) furnished a Form 6-K providing unaudited results for the three and six months ended June 30, 2026. The mobile ad-tech company grew revenue while posting a larger loss and materially lower cash.
For the first half of 2026, revenue was $6.28 million, up from $5.17 million in 2025, driven by higher Ad tech advertising, including programmatic and direct campaigns, particularly in North America and Western Europe. Gross profit was $2.67 million, but net loss widened to $2.37 million from $1.11 million as operating expenses rose, led by higher selling and marketing, software development, and a single-quarter concentration of $862,863 in bonuses and incentive compensation tied to 2025 performance.
Cash declined to $1.33 million from $4.45 million at year-end, with operating cash outflow of $3.12 million. Working capital fell to $2.89 million. The company emphasizes continued investment in its Kidoz Safe Ad Platform, Prado all-ages division, and AI-driven tools such as Kite IQ, while stating it expects to fund operations over the next 12 months through cash generation or additional financing.
Positive
- Revenue grew 21% year over year for the first half of 2026 to $6.28 million, and quarterly revenue rose 37% to $3.33 million, reflecting stronger demand for the company’s Ad tech advertising solutions.
- Gross profit increased to $2.67 million for the first half of 2026 from $2.48 million, indicating higher overall business volume despite increased costs.
- The company reports strong growth in programmatic and direct campaigns via its Kidoz and Prado platforms, supported by structural shifts toward contextual, privacy-compliant mobile advertising.
Negative
- Net loss more than doubled to $2.37 million for the first half of 2026 from $1.11 million, with quarterly loss at $1.56 million versus $1.17 million a year earlier.
- Operating cash outflow rose sharply to $3.12 million for the first half of 2026 from $0.35 million, pressuring liquidity.
- Cash balance fell from $4.45 million at December 31, 2025 to $1.33 million at June 30, 2026, and working capital declined from $5.08 million to $2.89 million.
- Operating expenses increased significantly, including $4.19 million in total operating expenses for the first half of 2026 versus $2.98 million, driven by higher bonuses, selling and marketing, and development spending.
Filing Explained
As of June 30, 2026, no new shares were issued; option expirations reduced the option balance while 131,304,499 common shares remained outstanding.
This Form 6-K furnishes Kidoz’s unaudited interim financial statements and management discussion for the periods ended
At
During the six months, 1,795,600 options expired unexercised and 55,000 were cancelled. The June 30 schedule showed 8,627,083 options outstanding, of which 5,565,592 were exercisable.
After
Key Figures
Key Terms
Ad tech advertising financial
programmatic revenue financial
Software Development Kit (SDK) technical
contextual targeting technical
fair value hierarchy financial
stock-based compensation financial
FAQ
How did KDOZF’s revenue perform for the quarter and first half ended June 30, 2026?
What was KDOZF’s profitability for the first half of 2026?
What is KDOZF’s cash and working capital position as of June 30, 2026?
How much did KDOZF spend on bonuses and incentive compensation in Q2 2026?
What were KDOZF’s operating cash flows for the first half of 2026?
Where does KDOZF generate most of its revenue geographically?
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of August 2026
Commission
File Number:
(Translation of registrant’s name into English)
Pacific Centre:
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
| Form 20-F ☒ | Form 40-F ☐ |
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐
Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934. Yes ☐ No ☒
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):
Exhibits:
| Exhibit Number | Description | |
| Exhibit 99.1 | Condensed Interim Consolidated Financial Statements for the Three Months Ended June 30, 2026 | |
| Exhibit 99.2 | Management’s Discussion and Analysis for the Three Months Ended June 30, 2026 | |
| Exhibit 99.3 | Form 52-10F2 CEO Certification of Interim Filings of Kidoz Inc. for quarter ended June 30, 2026. | |
| Exhibit 99.4 | Form 52-10F2 CFO Certification of Interim Filings of Kidoz Inc. for quarter ended June 30, 2026. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| KIDOZ INC. | ||
| (Registrant) | ||
| Date : August 26, 2026 | By: | /s/ J. M. Williams |
| J. M. WILLIAMS, | ||
| CEO | ||
Exhibit 99.1
Kidoz Inc.
and subsidiaries
Condensed Interim Consolidated Financial Statements
Unaudited
June 30, 2026
Kidoz Inc. and subsidiaries
MANAGEMENT’S RESPONSIBILITY FOR FINANCIAL REPORTING
The accompanying unaudited condensed interim consolidated financial statements of Kidoz Inc. are the responsibility of the management and Board of Directors of the Company.
The unaudited condensed interim consolidated financial statements have been prepared by management, on behalf of the Board of Directors, in accordance with the accounting policies disclosed in the notes to the financial statements. Where necessary, management has made informed judgments and estimates in accounting for transactions which were not complete at the statement of financial position date. In the opinion of management, the financial statements have been prepared within acceptable limits of materiality and are in accordance with the accounting principles generally accepted in the United States of America (“US GAAP”) applicable to interim financial information and with the rules and regulations of the United States Securities and Exchange Commission.
Management has established systems of internal control over the financial reporting process, which are designed to provide reasonable assurance that relevant and reliable financial information is produced.
The Board of Directors is responsible for reviewing and approving the financial statements together with other financial information of the Company and for ensuring that management fulfills its financial reporting responsibilities. An Audit Committee assists the Board of Directors in fulfilling this responsibility. The Audit Committee meets with management to review the financial reporting process and the unaudited condensed interim consolidated financial statements together with other financial information of the Company. The Audit Committee reports its findings to the Board of Directors for its consideration in approving the unaudited interim condensed consolidated financial statements together with other financial information of the Company for issuance to the shareholders.
Management recognizes its responsibility for conducting the Company’s affairs in compliance with established financial standards, and applicable laws and regulations, and for maintaining proper standards of conduct for its activities.
| /S/ J.M. Williams | /S/ H. W. Bromley | |
| J. M. Williams, | H.W. Bromley | |
| Chief Executive Officer | Chief Financial Officer |
| Page 1 |
Kidoz Inc. and subsidiaries
Unaudited Condensed Consolidated Interim Financial Statements
For Periods Ended June 30, 2026 and 2025
| Unaudited Condensed Interim Consolidated Financial Statements | ||
| Consolidated Balance Sheets | 3 | |
| Consolidated Statements of Operations and Comprehensive (Loss) Income | 4 | |
| Consolidated Statements of Stockholders’ Equity | 5 | |
| Consolidated Statements of Cash Flows | 6 | |
| Notes to Consolidated Financial Statements | 7 | |
| Page 2 |
Kidoz Inc. and subsidiaries
(Expressed in United States Dollars)
Unaudited Condensed Interim Consolidated Balance Sheets
(Unaudited)
| As at June 30, | June 30, 2026 | December 31, 2025 | ||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash | $ | $ | ||||||
| Accounts
receivable, less allowance for doubtful accounts $ |
||||||||
| Prepaid expenses | ||||||||
| Total Current Assets | ||||||||
| Equipment (Note 4) | ||||||||
| Goodwill (Note 6) | ||||||||
| Intangible assets (Note 5) | ||||||||
| Long term cash equivalent | ||||||||
| Security deposit | ||||||||
| Total Assets | $ | $ | ||||||
| Liabilities and Stockholders’ Equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | $ | ||||||
| Accrued liabilities | ||||||||
| Accounts payable and accrued liabilities - related party (Note 11) | ||||||||
| Total Liabilities | ||||||||
| Commitments (Note 10) | ||||||||
| Stockholders’ Equity (Note 8): | ||||||||
| Common
stock, |
||||||||
| Accumulated deficit | ( |
) | ( |
) | ||||
| Accumulated other comprehensive income: | ||||||||
| Foreign currency translation adjustment | ||||||||
| Total Stockholders’ Equity | ||||||||
| Total Liabilities and Stockholders’ Equity | $ | $ | ||||||
See accompanying notes to the unaudited condensed interim consolidated financial statements.
These unaudited condensed interim consolidated financial statements were authorized for issue by the Board of Directors on August 26, 2026. They are signed on the Company’s behalf by:
| Approved by the Board of Directors | /s/ Jason Williams |
| J. Williams | |
| CEO |
| Page 3 |
Kidoz Inc. and subsidiaries
(Expressed in United States Dollars)
Unaudited Condensed Interim Consolidated Statements of Operations and Comprehensive Loss
For Periods Ended June 30, 2026 and 2025
(Unaudited)
| Six
Months ended June 30, 2026 |
Six
Months ended June 30, 2025 |
Three
Months ended June 30, 2026 |
Three
Months ended June 30, 2025 |
|||||||||||||
| Revenue: | $ | $ | $ | $ | ||||||||||||
| Cost of sales: | ||||||||||||||||
| Gross profit | ||||||||||||||||
| Operating expenses: | ||||||||||||||||
| Bonuses and incentive compensation (Note 15) | ||||||||||||||||
| Depreciation and amortization (Notes 4 & 5) | ||||||||||||||||
| Directors fees (Note 13) | ||||||||||||||||
| General and administrative | ||||||||||||||||
| Provision for doubtful debts (Note 2) | ||||||||||||||||
| Salaries, wages, consultants and benefits | ||||||||||||||||
| Selling and marketing (Note 13) | ||||||||||||||||
| Stock awareness program | ( |
) | ( |
) | ||||||||||||
| Stock-based compensation (Note 9 & 13) | ||||||||||||||||
| Content and software development (Note 7) | ||||||||||||||||
| Total operating expenses | ||||||||||||||||
| Loss before other income (expense) and income taxes | ( |
) | ( |
) | ( |
) | ( |
) | ||||||||
| Other income (expense): | ||||||||||||||||
| Foreign exchange (loss) gain | ( |
) | ( |
) | ( |
) | ||||||||||
| Interest and other income | ||||||||||||||||
| Loss before income taxes | ( |
) | ( |
) | ( |
) | ( |
) | ||||||||
| Income tax recovery (expense) | ||||||||||||||||
| Net loss and comprehensive loss | $ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||
| Basic and diluted loss per common share | $ | ) | $ | ) | $ | ) | $ | ) | ||||||||
| Weighted average common shares outstanding, basic | ||||||||||||||||
| Weighted average common shares outstanding, diluted | ||||||||||||||||
See accompanying notes to the Unaudited Condensed Interim Consolidated Financial Statements.
| Page 4 |
Kidoz Inc. and subsidiaries
(Expressed in United States Dollars)
Unaudited Condensed Interim Consolidated Statements of Stockholders’ Equity
For the periods ended June 30, 2026 and 2025
(Unaudited)
| Six-Month period Ended June 30, 2026 | ||||||||||||||||||||
| Common stock | Accumulated | Accumulated Other Comprehensive income Foreign currency translation |
Total Stockholders’ | |||||||||||||||||
| Shares | Amount | Deficit | adjustment | Equity | ||||||||||||||||
| Balance, December 31, 2025 | $ | ($ | ) | $ | $ | |||||||||||||||
| Stock-based compensation | - | |||||||||||||||||||
| Net
income (loss) and comprehensive (loss) |
- | ( |
) | ( |
) | |||||||||||||||
| Balance, March 31, 2026 | $ | ($ | ) | $ | $ | |||||||||||||||
| Stock-based compensation | - | |||||||||||||||||||
| Net loss and comprehensive loss | - | ( |
) | ( |
) | |||||||||||||||
| Balance, June 30, 2026 | $ | ($ | ) | $ | ||||||||||||||||
| Six-Month period Ended June 30, 2025 | ||||||||||||||||||||
| Common stock | Accumulated | Accumulated Other Comprehensive income Foreign currency translation | Total Stockholders’ | |||||||||||||||||
| Shares | Amount | Deficit | adjustment | Equity | ||||||||||||||||
| Balance, December 31, 2024 | $ | ($ | ) | $ | $ | |||||||||||||||
| Stock-based compensation | - | |||||||||||||||||||
| Net loss and comprehensive loss | - | |||||||||||||||||||
| Balance, March 31, 2025 | $ | ($ | ) | $ | $ | |||||||||||||||
| Stock-based compensation | - | |||||||||||||||||||
| Net loss and comprehensive loss | - | ( | ) | ( | ) | |||||||||||||||
| Balance, June 30, 2025 | $ | ($ | ) | $ | ||||||||||||||||
See accompanying notes to the Unaudited Condensed Interim Consolidated Financial Statements.
| Page 5 |
Kidoz Inc. and subsidiaries
(Expressed in United States Dollars)
Unaudited Condensed Interim Consolidated Statements of Cash Flows
For the Six month periods ended June 30, 2026 and 2025
(Unaudited)
| 2026 | 2025 | |||||||
| Cash flows from operating activities: | ||||||||
| Net (loss) income | $ | ( | ) | $ | ( | ) | ||
| Adjustments
to reconcile net loss to net cash used in operating activities: | ||||||||
| Depreciation and amortization | ||||||||
| Provision for doubtful debts | ||||||||
| Stock-based compensation | ||||||||
| Unrealized foreign exchange loss | ( | ) | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | ||||||||
| Prepaid expenses | ( | ) | ( | ) | ||||
| Accounts payable and accrued liabilities | ( | ) | ( | ) | ||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| Cash flows from investing activities: | ||||||||
| Acquisition of equipment | ( | ) | ( | ) | ||||
| Long-term cash equivalent | ||||||||
| Net cash (used in) provided by investing activities | ( | ) | ( | ) | ||||
| Cash flows from financing activities: | ||||||||
| Payments on operating lease liabilities | ||||||||
| Net cash used in financing activities | ||||||||
| Change in cash | ( | ) | ( | ) | ||||
| Cash, beginning of period | ||||||||
| Cash, end of period | $ | $ | ||||||
| Supplementary information: | ||||||||
| Interest paid | $ | $ | ||||||
| Income taxes paid | $ | ( | ) | $ | ||||
See accompanying notes to the Unaudited Condensed Interim Consolidated Financial Statements.
| Page 6 |
KIDOZ INC. and subsidiaries
(Expressed in United States Dollars)
Notes to Unaudited Condensed Interim Consolidated Financial Statements
Six Months ended June 30, 2026 and 2025
(Unaudited)
| 1. | Basis of Presentation: |
The accompanying unaudited condensed interim consolidated financial statements have been prepared by Kidoz Inc. (“the Company”) in conformity with accounting principles generally accepted in the United States of America (“US GAAP”) applicable to interim financial information and with the rules and regulations of the United States Securities and Exchange Commission. Accordingly, certain information and footnote disclosures normally included in annual consolidated financial statements prepared in accordance with generally accepted accounting principles have been condensed, or omitted, pursuant to such rules and regulations. In the opinion of management, the unaudited condensed interim consolidated financial statements include all adjustments necessary for the fair presentation of the results of the interim periods presented. All adjustments are of a normal recurring nature, except as otherwise noted below. These unaudited interim consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto filed April 29, 2026 for the year ended December 31, 2025, included in the Company’s Annual Financial Statements and Management’s Discussion and Analysis filed with the TSX Venture Exchange on SEDAR and the Annual Report on Form 20-F, filed with the Securities and Exchange Commission. The results of operations for the interim periods are not necessarily indicative of the results of operations for any other interim period or for a full fiscal year.
Continuing operations
These unaudited condensed interim consolidated financial statements have been prepared assuming the realization of assets and the settlement of liabilities in the normal course of operations. The Company expects to continue to generate sufficient cash flows to fund continued operations for the next 12 months, or, in the absence of adequate cash flows from operations, obtaining additional financing.
Management continues to review operations in order to identify additional strategies designed to generate cash flow, improve the Company’s financial position, and enable the timely discharge of the Company’s obligations.
| 2. | Summary of significant accounting policies: |
(a) Basis of presentation:
These unaudited condensed interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) applicable to annual financial information and with the rules and regulations of the United States Securities and Exchange Commission and the TSX Venture Exchange.
The financial statements include the accounts of the Company’s subsidiaries:
| Company | Registered | % Owned | ||
| Shoal Media (Canada) Inc. | British Columbia, Canada | |||
| Kidoz Ltd. | Israel | |||
| Prado Media Ltd. | British Columbia, Canada | |||
| Shoal Media Inc. | Anguilla | |||
| Shoal Media (UK) Ltd. | United Kingdom |
| Page 7 |
KIDOZ INC. and subsidiaries
(Expressed in United States Dollars)
Notes to Unaudited Condensed Interim Consolidated Financial Statements
Six Months ended June 30, 2026 and 2025
(Unaudited)
| 2. | Summary of significant accounting policies (Continued): |
(a) Basis of presentation: (Continued)
In addition, there are the following dormant subsidiaries; Bingo.com (Antigua) Inc., Bingo.com (Wyoming) Inc., and Bingo Acquisition Corp.
All inter-company balances and transactions have been eliminated in the consolidated financial statements.
In the second quarter of 2026, the Company reclassified certain content and software development costs related to the Company’s server costs from content and software development to cost of sales and reclassified bonuses and incentive compensation from salaries, wages, consultants and benefits, selling and marketing and content and development expenses to bonuses and incentive compensation. These reclassifications had no impact on the Company’s Condensed Consolidated Balance Sheets, Condensed Consolidated Statements of Earnings and Comprehensive Income, Condensed Consolidated Statements of Stockholders’ Equity or Condensed Consolidated Statements of Cash Flow. The financial results for the three and six months ended June 30, 2025 have been recast for comparison purposes and to conform to the current period classification. The reclassification did not have any impact on the total income from operations.
(b) Use of estimates:
The preparation of unaudited condensed interim consolidated financial statements in conformity with US GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and recognized revenues and expenses for the reporting periods.
Significant areas requiring the use of estimates include the collectability of accounts receivable, the valuation of stock-based compensation, the valuation of deferred tax assets and liabilities, the useful lives of intangible assets, the inputs used in assessing goodwill impairment, and the derivative liability – warrants valuation. Actual results may differ significantly from these estimates.
(c) Revenue recognition:
In accordance with ASC 606, Revenue from Contracts with Customers, revenue is recognized when a customer obtains control of promised services. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for these services.
We derive substantially all of our revenue from the sale of Ad tech advertising revenue. The content revenue is less than 10% of the total revenue.
To achieve this core principle, the Company applied the following five steps:
1) Identify the contract with a customer
A contract with a customer exists when (i) the Company enters into an enforceable contract with a customer that defines each party’s rights regarding the services to be transferred, whose impression
| Page 8 |
KIDOZ INC. and subsidiaries
(Expressed in United States Dollars)
Notes to Unaudited Condensed Interim Consolidated Financial Statements
Six Months ended June 30, 2026 and 2025
(Unaudited)
| 2. | Summary of significant accounting policies (Continued): |
(c) Revenue recognition: (Continued)
count will form the basis of the revenue and identifies the payment terms related to these services, (ii) the contract has commercial substance and, (iii) the Company determines that collection of substantially all consideration for services that are transferred is probable based on the customer’s intent and ability to pay the promised consideration. The Company applies judgment in determining the customer’s ability and intention to pay, which is based on a variety of factors including the customer’s historical payment experience or, in the case of a new customer, published credit and financial information pertaining to the customer.
2) Identify the performance obligations in the contract
Performance obligations promised in a contract are identified based on the services that will be transferred to the customer that are both capable of being distinct, whereby the customer can benefit from the service either on its own or together with other resources that are readily available from third parties or from the Company, and are distinct in the context of the contract, whereby the transfer of the services is separately identifiable from other promises in the contract. To the extent a contract includes multiple promised services, the Company must apply judgment to determine whether promised services are capable of being distinct and distinct in the context of the contract. If these criteria are not met the promised services are accounted for as a combined performance obligation.
3) Determine the transaction price
The transaction price is determined based on the consideration to which the Company will be entitled in exchange for transferring services to the customer. None of the Company’s contracts contain financing or variable consideration components.
4) Allocate the transaction price to performance obligations in the contract
If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price to each performance obligation based on a relative standalone selling price basis. The Company determines standalone selling price based on the price at which the performance obligation is sold separately. If the standalone selling price is not observable through past transactions, the Company estimates the standalone selling price taking into account available information such as market conditions and internally approved pricing guidelines related to the performance obligations.
5) Recognize revenue when or as the Company satisfies a performance obligation
The Company satisfies performance obligations at a point in time as discussed in further detail under “Disaggregation of Revenue” below. Revenue is recognized at the time the related performance obligation is satisfied by transferring a promised service to a customer.
| Page 9 |
KIDOZ INC. and subsidiaries
(Expressed in United States Dollars)
Notes to Unaudited Condensed Interim Consolidated Financial Statements
Six Months ended June 30, 2026 and 2025
(Unaudited)
| 2. | Summary of significant accounting policies (Continued): |
(c) Revenue recognition: (Continued)
Disaggregation of Revenue
All of the Company’s performance obligations, and associated revenue, are generally transferred to customers at a point in time. The Company has the following revenue streams:
1) Ad tech advertising revenue - The pricing and terms for all our in-game advertising arrangements are mostly governed by insertion order which generally stipulates the payment terms, the duration (usually short term in nature), the number of advertising units delivered (e.g. impressions, completed views, or cost per install) and the contractually agreed upon price per advertising unit. The Company has concluded that the delivery of the Ad tech advertising is delivered at a point in time and, as such, has concluded these deliveries are a single performance obligation. The Company invoices fees which are generally variable based on the arrangement, which would typically include the number of impressions delivered at a specified price per application. For impressions delivered, revenue is recognized in the month in which the Company delivers the application to the end consumer or the month when the campaign ends.
2) Programmatic revenue - The Company generally offers these services under a programmatic bid on a Cost-per-Impression (CPM) basis. Our customers upload their advertisements into a demand side platform which then connects to our Publisher Software Development Kit (“SDK”) through an exchange platform and on a bid system agree on the CPM rate and the impressions to be served.
The Company has concluded that the delivery of the Programmatic advertising is delivered at the earlier of month end or at a point in time and, as such, has concluded these deliveries are a single performance obligation. The Company is deemed to be the principal in the transaction and therefore recognizes the revenue on a gross basis and commissions are recognized as cost of sales. The Company invoices fees which are generally variable based on the arrangement, which would typically include the number of impressions delivered at a specified price per application. For impressions delivered, revenue is recognized in the month in which the Company delivers the application to the end consumer or the month when the campaign ends.
3) Content revenue – The Company recognizes content revenue on the following forms of revenue:
a) Carriers and Original Equipment Manufacturer (“OEMs”) - The Company generally offers these services under a customer contract per tablet device license fee model with OEMs. Monthly or quarterly license fees are based on the OEM agreement with the number of devices the Kidoz Kid Mode is installed upon.
b) Rooplay - The Company generates revenue through subscriptions or premium sales of Rooplay, (www.rooplay.com) the cloud-based EduGame system for kids to learn and play within its games on smartphones and tablet devices, such as Apple’s iPhone and iPad, and mobile devices utilizing Google’s Android operating system. The revenue is recognized net of platform fees.
| Page 10 |
KIDOZ INC. and subsidiaries
(Expressed in United States Dollars)
Notes to Unaudited Condensed Interim Consolidated Financial Statements
Six Months ended June 30, 2026 and 2025
(Unaudited)
| 2. | Summary of significant accounting policies (Continued): |
(c) Revenue recognition: (Continued)
c) Rooplay licensing - The Company licenses its branded educational games under a monthly cost per game agreement license fee model. Monthly license fees are based on the number of games licensed.
The Company has identified the following performance obligations in these contracts:
i. Ongoing game related services such as hosting of game play, storage of customer content, when and if available content updates, maintaining the virtual currency management engine, tracking gameplay statistics, matchmaking as it relates to multiple player gameplay, etc.
ii. Obligation to the paying player to continue displaying and providing access to the virtual items within the game.
Neither of these obligations are considered distinct since the actual mobile game and the related ongoing services are both required to purchase and benefit from the related virtual items. As such, the Company’s performance obligations represent a single combined performance obligation which is to make the game and the ongoing game related services available to the players. The revenue is recognized net of platform fees.
(d) Software Technology Development Costs:
The Company expenses all software development costs as incurred for the period ended June 30, 2026 and 2025. As at June 30, 2026, and December 31, 2025, all capitalized software development costs have been fully amortized and the Company has no capitalized software development costs.
Total
software development costs were $
(e) Impairment of long-lived assets and long-lived assets to be disposed of:
If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount and the fair value less costs to sell.
(f) Intangible assets:
The Company identified the following intangible assets in the acquisition of Kidoz Ltd. Finite life intangible assets are recorded at historical cost less accumulated amortization based on their estimated useful life and any impairment is determined in accordance with ASC 360. The Company does not have any indefinite life intangible assets.
| Page 11 |
KIDOZ INC. and subsidiaries
(Expressed in United States Dollars)
Notes to Unaudited Condensed Interim Consolidated Financial Statements
Six Months ended June 30, 2026 and 2025
(Unaudited)
| 3. | Summary of significant accounting policies (Continued): |
(f) Intangible assets: (Continued)
Amortization is provided for annually on the straight-line method over the following periods:
| Amortization period | ||
| Ad Tech technology | ||
| Kidoz OS technology | ||
| Customer relationships |
The Company reviews intangible assets subject to amortization quarterly to determine if any adverse conditions exist or a change in circumstances has occurred that would indicate impairment or a change in the remaining useful life. If an impairment indicator exists, we test the intangible asset for recoverability. For purposes of the recoverability test, amortizable intangible assets are grouped with other assets and liabilities at the lowest level of identifiable cash flows if the intangible asset does not generate cash flows independent of other assets and liabilities. If the carrying value of the asset group exceeds the undiscounted cash flows expected to result from the use and eventual disposition of the asset group, the Company will write the carrying value down to the fair value in the period identified.
(g) Goodwill:
The Company accounts for goodwill in accordance with the provisions of ASC 350, Intangibles-Goodwill and Others. Goodwill is the excess of the purchase price over the fair value of identifiable assets acquired, less liabilities assumed, in a business combination. The Company reviews goodwill for impairment. Goodwill is not amortized but is evaluated for impairment at least annually or whenever events or changes in circumstances indicate that it is more likely than not that the carrying amount may not be recoverable.
The goodwill impairment test is used to identify both the existence of impairment and the amount of impairment loss and compares the fair value of a reporting unit with its carrying amount and is based on discounted future cash flows, based on market multiples applied to free cash flow. The determination of the fair value of our reporting units requires management to make significant estimates and assumptions including the selection of control premiums, discount rates, terminal growth rates, forecasts of revenue and expense growth rates, income tax rates, changes in working capital, depreciation, amortization and capital expenditures. Changes in assumptions concerning future financial results, exogenous market conditions, or other underlying assumptions could have a significant impact on either the fair value of the reporting unit or the amount of the goodwill impairment charge. If the carrying value of the reporting unit exceeds its fair value, an impairment loss is recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit.
During
the year ended December 31, 2025, there was
| Page 12 |
KIDOZ INC. and subsidiaries
(Expressed in United States Dollars)
Notes to Unaudited Condensed Interim Consolidated Financial Statements
Six Months ended June 30, 2026 and 2025
(Unaudited)
| 2. | Summary of significant accounting policies (Continued): |
(h) New accounting pronouncements and changes in accounting policies:
In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. The new standard requires entities to disclose additional information about certain expenses, such as purchases of inventory, employee compensation, depreciation, intangible asset amortization, as well as selling expenses included in commonly presented expense captions on the income statement. The FASB further clarified the effective date in January 2025 with the issuance of ASU 2025-01, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date. The ASU is effective for fiscal years beginning after December 15, 2026, and interim periods beginning after December 15, 2027. Companies have the option to apply this guidance either on a retrospective or prospective basis, and early adoption is permitted. The company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements and related disclosures.
In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use amendments remove references to prescriptive software development stages and clarify that Software, to simplify and modernize the accounting for internal-use software costs. The capitalization of eligible software development costs begins when management authorizes and commits to funding the project and it is probable the project will be completed, and the software will be used as intended. The amendments in this update are effective for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual periods. Early adoption is permitted, and the guidance may be applied prospectively, retrospectively, or using a modified approach for in-process projects. The Company is evaluating the impact this guidance will have on the consolidated financial statements and related disclosures.
In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements, which clarifies the applicability of the interim reporting guidance, the types of interim reporting, and the form and content of interim financial statements in accordance with U.S. GAAP. Per the FASB, the amendment does not intend to change the fundamental nature of interim reporting or expand or reduce current interim disclosure requirements but rather provide clarity and improve navigability of the existing interim reporting requirements. The amendments will be effective for interim reporting periods within annual reporting periods beginning after December 15, 2027. The amendments may be applied prospectively or retrospectively, and early adoption is permitted. The Company is currently evaluating this ASU to determine its impact on the Company’s disclosures.
| Page 13 |
KIDOZ INC. and subsidiaries
(Expressed in United States Dollars)
Notes to Unaudited Condensed Interim Consolidated Financial Statements
Six Months ended June 30, 2026 and 2025
(Unaudited)
| 2. | Summary of significant accounting policies (Continued): |
(h) New accounting pronouncements and changes in accounting policies: (Continued)
The Company has evaluated all the recently issued, but not yet effective, accounting standards that have been issued or proposed by the Financial Accounting Standards Board or other standards-setting bodies through the filing date of these consolidated financial statements and does not believe the future adoption of any such pronouncements will have a material impact on its consolidated financial statements.
(i) Financial instruments and fair value measurements:
(i) Fair values:
Fair value is the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on measurement date. The Company classifies assets and liabilities recorded at fair value under the fair value hierarchy based upon the observability of inputs used in valuation techniques. Observable inputs (highest level) reflect market data obtained from independent sources, while unobservable inputs (lowest level) reflect internally developed market assumptions. The fair value measurements are classified under the following hierarchy:
Level 1—Observable inputs that reflect quoted market prices (unadjusted) for identical assets and liabilities in active markets;
Level 2—Observable inputs, other than quoted market prices, that are either directly or indirectly observable in the marketplace for identical or similar assets and liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets and liabilities; and
Level 3—Unobservable inputs that are supported by little or no market activity that are significant to the fair value of assets or liabilities.
When available, we use quoted market prices to determine fair value, and we classify such measurements within Level 1. In some cases where market prices are not available, we make use of observable market-based inputs to calculate fair value, in which case the measurements are classified within Level 2. If quoted or observable market prices are not available, fair value is based upon valuations in which one or more significant inputs are unobservable, including internally developed models that use, where possible, current market-based parameters such as interest rates, yield curves and currency rates. These measurements are classified within Level 3.
Fair value measurements are classified according to the lowest level input or value-driver that is significant to the valuation. A measurement may therefore be classified within Level 3 even though there may be significant inputs that are readily observable.
Fair value measurement includes the consideration of nonperformance risk. Nonperformance risk refers to the risk that an obligation (either by a counterparty) will not be fulfilled. For financial assets traded in an active market (Level 1 and certain Level 2), the nonperformance risk is included in the market price. For certain other financial assets and liabilities (certain Level 2 and Level 3), our fair value calculations have been adjusted accordingly.
| Page 14 |
KIDOZ INC. and subsidiaries
(Expressed in United States Dollars)
Notes to Unaudited Condensed Interim Consolidated Financial Statements
Six Months ended June 30, 2026 and 2025
(Unaudited)
| 2. | Summary of significant accounting policies (Continued): |
(i) Financial instruments and fair value measurements: (Continued)
(i) Fair values: (Continued)
The fair value of accounts receivable, accounts payable, accrued liabilities, and accounts payable, and accrued liabilities - related party approximate their financial statement carrying amounts due to the short-term maturities of these instruments and are therefore carried at their historical cost basis.
Fair values determined by Level 3 inputs are unobservable data points for the asset or liability, and included situations where there is little, if any, market activity for the asset. Stock-based compensation and derivative liability – warrants were measured using Level 2 inputs. Goodwill impairment was measured using Level 3 inputs.
(ii) Foreign currency risk:
The Company operates internationally, which gives rise to the risk that cash flows may be adversely impacted by exchange rate fluctuations. The Company has not entered into any forward exchange contracts or other derivative instrument to hedge against foreign exchange risk.
| 3. | Accounts Receivable: |
The accounts receivable as at June 30, 2026, is summarized as follows:
| June 30, 2026 | December 31, 2025 | |||||||
| Accounts receivable | $ | $ | ||||||
| Provision for doubtful accounts | ( | ) | ( | ) | ||||
| Net accounts receivable | $ | $ | ||||||
The
Company has a doubtful debt provision of $
| 4. | Equipment: |
| June 30, 2026 | Cost | Accumulated depreciation | Net book Value | |||||||||
| Equipment and computers | $ | $ | $ | |||||||||
| Furniture and fixtures | ||||||||||||
| $ | $ | $ | ||||||||||
| Page 15 |
KIDOZ INC. and subsidiaries
(Expressed in United States Dollars)
Notes to Unaudited Condensed Interim Consolidated Financial Statements
Six Months ended June 30, 2026 and 2025
(Unaudited)
| 4. | Equipment: (Continued) |
| December 31, 2025 | Cost | Accumulated depreciation | Net book Value | |||||||||
| Equipment and computers | $ | $ | $ | |||||||||
| Furniture and fixtures | ||||||||||||
| $ | $ | $ | ||||||||||
Depreciation
expense was $
| 5. | Intangible assets: |
| June 30, 2026 | Cost | Accumulated amortization | Net book Value | |||||||||
| Customer relationship | $ | $ | $ | |||||||||
| $ | $ | $ | ||||||||||
| December 31, 2025 | Cost | Accumulated amortization | Net book Value | |||||||||
| Customer relationship | $ | $ | $ | |||||||||
| $ | $ | $ | ||||||||||
Amortization
expense was $
| 6. | Goodwill: |
The
Company has a goodwill balance of $
The
Company’s annual goodwill impairment analysis performed during the fourth quarter of fiscal 2025 included a quantitative analysis
of the Kidoz Ltd. reporting unit (consisting of intangible assets (Note 5), and goodwill). The reporting unit has a carrying amount of
$
| 7. | Software technology development costs: |
The Company develops software technology for our business. This software technology includes the continued development of the KIDOZ Safe Ad Network, the KIDOZ Kid-Mode Operating System, and the KIDOZ publisher SDK.
| Page 16 |
KIDOZ INC. and subsidiaries
(Expressed in United States Dollars)
Notes to Unaudited Condensed Interim Consolidated Financial Statements
Six Months ended June 30, 2026 and 2025
(Unaudited)
| 7. | Software technology development costs: (Continued) |
During the six month period ended June 30, 2026, the Company has expensed the development costs of all products as incurred and has expensed the following development costs.
| Six Months ended June 30, 2026 | Six Months ended June 30, 2025 | Three Months ended June 30, 2026 | Three Months ended June 30, 2025 | |||||||||||||
| Opening total software development costs | $ | $ | $ | $ | ||||||||||||
| Software development during the period | ||||||||||||||||
| Closing total Software development costs | $ | $ | $ | $ | ||||||||||||
| 8. | Stockholders’ Equity: |
The holders of common stock are entitled to one vote for each share held. There are no restrictions that limit the Company’s ability to pay dividends on its common stock. The Company has not declared any dividends since incorporation. The Company’s common stock has no par value per common stock and there is only one class of common shares. The Company has an unlimited number of common shares authorized for issue.
(a) Common stock issuances:
There were stock issuances during the quarter ended June 30, 2026 and 2025.
(b) Stock option plans:
2015 stock option plan
In the year ended December 31, 2015, the shareholders approved the 2015 stock option plan. The 2015 stock option plan as amended in November 2020, is intended to provide incentive to employees, directors, advisors and consultants of the Company to encourage proprietary interest in the Company, to encourage such employees to remain in the employ of the Company or such directors, advisors and consultants to remain in the service of the Company, and to attract new employees, directors, advisors and consultants with outstanding qualifications.
During the year ended December 31, 2024, a new 10% “rolling” stock option plan (the “2024 Stock Option Plan”) that complies with the updated TSX Policy 4.4 was approved by the TSX-V, the Board of Directors and the Company’s shareholders. The 2024 Stock Option Plan will replace 2015 Stock Option Plan. Options granted under the 2015 Stock Option Plan will continue to be governed by the 2015 Stock Option Plan. The 2015 Stock Option plan will continue to exist until the stock options granted under the 2015 Stock Option are exercised, cancelled or expire. All new stock option grants will be made under the 2024 Stock Option Plan.
There were no options granted during the period ended June 30, 2026.
During the period ended June 30, 2026, options at CAD$ (US$) expired unexercised. During the period ended March 31, 2026, options at CAD$ ($) expired unexercised and options were cancelled.
Subsequent to the period ended June 30, 2026, options at CAD$ (US$) expired unexercised.
| Page 17 |
KIDOZ INC. and subsidiaries
(Expressed in United States Dollars)
Notes to Unaudited Condensed Interim Consolidated Financial Statements
Six Months ended June 30, 2026 and 2025
(Unaudited)
| 8. | Stockholders’ Equity: (Continued) |
(b) Stock option plans: (Continued)
| Number of options | Weighted average exercise price | |||||||
| Outstanding December 31, 2024 | $ | |||||||
| Granted | ||||||||
| Expired | ( | ) | ( | ) | ||||
| Cancelled | ( | ) | ( | ) | ||||
| Outstanding December 31, 2025 | $ | |||||||
| Cancelled | ( | ) | ( | ) | ||||
| Expired | ( | ) | ( | ) | ||||
| Outstanding June 30, 2026 | $ | |||||||
The aggregate intrinsic value for options as of June 30, 2026 was $ (December 31, 2025 - $).
| Exercise prices per share | Number outstanding | Number exercisable | Expiry date | |||||||||
| CAD$ | ||||||||||||
| CAD$ | ||||||||||||
| CAD$ | ||||||||||||
| CAD$ | ||||||||||||
| CAD$ | ||||||||||||
During the quarter ended June 30, 2026, the Company recorded stock-based compensation of $ on the options granted and vested (June 30, 2025 – $) and as per the Black-Scholes option-pricing model, with a weighted average fair value per option grant of $ (June 30, 2025 - $).
(c) The Equity Awards Plan:
During the quarter ended March 31, 2025 the Company initiated The Equity Awards Plan to complement the 2024 Stock Option Plan as an integral part of the Companies overall compensation plan.
The Equity Awards Plan is a fixed % plan under which the Company may issue such number of security-based compensation (other than options) up to % of the issued and outstanding shares as of the date the Equity Awards Plan is implemented.
| Page 18 |
KIDOZ INC. and subsidiaries
(Expressed in United States Dollars)
Notes to Unaudited Condensed Interim Consolidated Financial Statements
Six Months ended June 30, 2026 and 2025
(Unaudited)
| 8. | Stockholders’ Equity: (Continued) |
(c) The Equity Awards Plan: (Continued)
During the year ended December 31, 2025, the Equity Awards Plan was approved by the TSX Venture Exchange (“TSXV”) and by the Company’s Shareholders at the 2025 Annual General Shareholder meeting.
| 9. | Fair value measurement: |
Except for derivative liability – warrant that was measured at level 3 inputs in the three-tier fair value hierarchy, the Company does not have any other financial instruments that are subsequently measured at fair value.
| 10. | Commitments: |
The Company leases office facilities in Netanya, Israel. This office facility is leased under operating lease agreements.
During the year ended December 31, 2025, the Company entered a new lease agreement in Netanya, Israel. The agreement is for 12 months, but unless 3 months’ notice is given it automatically renews for a future 12 months until notice is given. The renewal of this lease is uncertain, hence the Company has accounted for this lease as a short-term lease.
Minimum lease payments under these leases are approximately as follows:
| 2026 | $ |
The
Company paid rent expense totaling $
| Page 19 |
KIDOZ INC. and subsidiaries
(Expressed in United States Dollars)
Notes to Unaudited Condensed Interim Consolidated Financial Statements
Six Months ended June 30, 2026 and 2025
(Unaudited)
| 10. | Commitments: (Continued) |
The Company has the following management consulting agreements with related parties.
| Company | Person | Role | Annual amount | |||||||
| T.M. Williams (ROW), Inc. | T. M. Williams | Chairman | $ | |||||||
| - | Jason Williams | CEO | $ | |||||||
| Bromley Accounting Services Ltd. | H. W. Bromley | CFO | $ | |||||||
| Farcast Operations Inc. | T. H. Williams | COO | CAD$ | |||||||
As at June 30, 2026, the Company had a number of renewable license commitments with large brands, including, Mr. Men and Little Miss. These agreements have commitments to pay royalties on the revenue from the licenses subject to the minimum guarantee payments. As at As at June 30, 2026, there were no further minimum guarantee payments commitments.
The
Company expensed the minimum guarantee payments over the life of the agreement and recognized license expense of $
| 11. | Related party transactions: |
For the quarter ended June 30, 2026, the Company has the following related party transactions:
| Six Months ended June 30, 2026 | Six Months ended June 30, 2025 | Three Months ended June 30, 2026 | Three Months ended June 30, 2025 | |||||||||||||
| Bonuses and incentive compensation | ||||||||||||||||
| Directors fees | $ | $ | $ | $ | ||||||||||||
| Salaries, wages, consultants and benefits | ||||||||||||||||
| Selling and marketing | ||||||||||||||||
| Stock-based compensation (Note 9) | ||||||||||||||||
| Software technology development (Note 7) | ||||||||||||||||
| Closing balance for the period | $ | $ | $ | $ | ||||||||||||
The
Company has liabilities of $
The related party transactions are in the normal course of operations and were measured at the currency exchange amount, which is the amount of consideration established and agreed to by the related parties.
| 12. | Segmented information: |
In accordance with ASC 280-10-50-11 Segmented Disclosure, the Company operates one reportable business segments, the sale of Ad tech advertising. The Company’s chief operating decision makers are the Chairman, Chief Executive Officer, Chief Operations Officer and Chief Strategy Officer. The Company’s chief operating decision makers reviews financial information on a consolidated basis,
| Page 20 |
KIDOZ INC. and subsidiaries
(Expressed in United States Dollars)
Notes to Unaudited Condensed Interim Consolidated Financial Statements
Six Months ended June 30, 2026 and 2025
(Unaudited)
| 12. | Segmented information: (Continued) |
principally to make decisions about how to allocate resources and to measure the Company’s performance. The chief operating decision maker reviews consolidated net income (loss), which is the measure of financial profit and loss most closely aligned with generally accepted accounting principles.
Reconciliation to net income:
| Six Months ended June 30, 2026 | Six Months ended June 30, 2025 | Three Months ended June 30, 2026 | Three Months ended June 30, 2025 | |||||||||||||
| Revenue | $ | $ | $ | $ | ||||||||||||
| Cost of revenue | ||||||||||||||||
| Gross profit | ||||||||||||||||
| Segment operating expenses | ||||||||||||||||
| Total operating (loss) income | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Unallocated expenses | ||||||||||||||||
| Depreciation | ||||||||||||||||
| Foreign exchange (gain) loss | ( | ) | ||||||||||||||
| Interest income | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Stock awareness program | ( | ) | ( | ) | ||||||||||||
| Stock-based compensation | ||||||||||||||||
| Net loss before income taxes | $ | ( | ) | ( | ) | ( | ) | ( | ) | |||||||
The Company had the following revenue by geographical region based on impression served.
| Six Months ended June 30, 2026 | Six Months ended June 30, 2025 | Three Months ended June 30, 2026 | Three Months ended June 30, 2025 | |||||||||||||
| Total revenue | ||||||||||||||||
| Western Europe | $ | $ | $ | $ | ||||||||||||
| Central, Eastern and Southern Europe | ||||||||||||||||
| North America | ||||||||||||||||
| Rest of World | ||||||||||||||||
| Total revenue | $ | $ | $ | $ | ||||||||||||
Equipment
The Company’s equipment is located as follows:
| Net Book Value | June 30, 2026 | December 31, 2025 | ||||||
| Canada | $ | $ | ||||||
| Israel | ||||||||
| United Kingdom | ||||||||
| Total equipment | $ | $ | ||||||
| Page 21 |
KIDOZ INC. and subsidiaries
(Expressed in United States Dollars)
Notes to Unaudited Condensed Interim Consolidated Financial Statements
Six Months ended June 30, 2026 and 2025
(Unaudited)
| 13. | Concentrations: |
Major customers
During
the quarter ended June 30, 2026 and 2025, the Company sold Ad tech revenue; sold subscriptions on its site Rooplay; and premium purchases
of Rooplay Originals. During the quarter ended June 30, 2026, the Company had revenues of $
| 14. | Concentrations of credit risk: |
Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and accounts receivable. The Company places its cash and cash equivalents with high quality financial institutions and limits the amount of credit exposure with any one institution.
The
Company currently maintains a substantial portion of its day-to-day operating cash and long-term cash equivalents balances at financial
institutions. At June 30, 2026, the Company had total cash of $
The Company has concentrations of credit risk with respect to accounts receivable, the majority of its accounts receivable are concentrated geographically in the United States amongst a small number of customers.
As
of June 30, 2026, the Company had three customers, totaling $
The Company controls credit risk through monitoring procedures and receiving prepayments of cash for services rendered. The Company performs credit evaluations of its customers but generally does not require collateral to secure accounts receivable.
| 15. | Bonuses and incentive compensation: |
During
the quarter ended June 30, 2026, the Company paid bonuses and incentive compensation of $
| Page 22 |
EXHIBIT 99.2
Kidoz Inc.
and subsidiaries
Management’s Discussion and Analysis
For the three and six months ended June 30, 2026
(Expressed on United States Dollars, unless otherwise noted)
Pacific Centre
Suite 1500
701 West Georgia Street
Vancouver, British Columbia
V7Y 1C6
Canada
Tel : +1 888-374-2163
www.kidoz.net
KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
TABLE OF CONTENTS
| BACKGROUND | 1 |
| FORWARD LOOKING STATEMENTS | 1 |
| OVERVIEW | 2 |
| INCORPORATION AND NATURE OF OPERATIONS | 3 |
| BUSINESS OVERVIEW | 4 |
| OPERATIONS | 6 |
| HIGHLIGHTS FOR THE THREE MONTHS ENDED JUNE 30, 2026 | 7 |
| SUMMARY CONSOLIDATED FINANCIAL INFORMATION | 8 |
| DISCUSSION OF OPERATIONS AND OPERATIONAL HIGHLIGHTS | 9 |
| SUMMARY OF QUARTERLY RESULTS | 12 |
| LIQUIDITY AND CAPITAL RESOURCES | 13 |
| SHARE CAPITAL | 13 |
| OFF BALANCE SHEET ARRANGEMENTS | 14 |
| COMMITMENTS | 14 |
| RELATED PARTY TRANSCATIONS | 15 |
| ACCOUNTING POLICY CHANGES, CRITICAL ESTIMATES, JUDGMENTS AND ASSUMPTIONS | 15 |
| NEW ACCOUNTING PRONOUCEMENTS AND CHANGES IN ACCOUNTING POLICIES | 16 |
| FINANCIAL INSTRUMENTS AND OTHER INSTRUMENTS | 17 |
| RISKS AND UNCERTAINTIES | 18 |
| ADDITIONAL INFORMATION | 22 |
KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
BACKGROUND
This Management’s Discussion and Analysis (“MD&A”) of Kidoz Inc. and its subsidiaries (the “Company”) constitutes management’s review of the financial condition and results of operations for the three months ended June 30, 2026 and 2025. This MD&A should be read in conjunction with the Company’s unaudited condensed interim consolidated financial statements for the quarter ended June 30, 2026 and 2025, prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”).
This MD&A takes into account all material events that took place up until August 26, 2026, the date on which the Company’s Board of Directors approved this MD&A. Unless otherwise noted, all figures are in U.S. dollars, the presentation and functional currency of the Company. In the opinion of management, all adjustments (which consist only of normal recurring adjustments) considered necessary for a fair presentation have been included. The results presented for the quarter ended June 30, 2026, are not necessarily indicative of the results that may be expected for any future period.
The Condensed unaudited Financial Statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated on consolidation.
Additional information regarding the Company is available on SEDAR+ at www.sedarplus.com and on the Company’s website at www.kidoz.net.
FORWARD LOOKING STATEMENTS
This MD&A contains certain forward-looking information and forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933, as amended (the “U.S. Securities Act”), Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and “forward-looking information” under Canadian securities laws (collectively referred to herein as “forward-looking statements”). All documents incorporated herein by reference, as well as statements made in press releases and oral statements that may be made by us or by officers, directors or employees acting on our behalf, that are not statements of historical fact constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to future events or the Company’s future performance. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause our actual results to be materially different from historical results or from any future results expressed or implied by such forward-looking statements. Readers should consider statements that include the terms “believe,” “belief,” “expect,” “plan,” “anticipate,” “intend” or the like to be uncertain and forward-looking. In addition, all statements, trends, analyses and other information contained in this report relative to trends in net sales, gross margin, anticipated expense levels and liquidity and capital resources, constitute forward-looking statements. Particular attention should be paid to the facts of our limited operating history, the unpredictability of our future revenues, our need for and the availability of capital resources, the evolving nature of our business model, and the risks associated with systems development, management of growth and business expansion. Except as required by law, we undertake no obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise. All cautionary statements made herein should be read as being applicable to all forward-looking statements wherever they appear. The forward-looking statements contained in this MD&A are based on our current expectations and beliefs concerning future developments and their potential effects on us taking into account information currently available to us. These forward-looking statements are subject to risks, uncertainties and other factors, some of which are beyond our control, which could cause actual results to differ materially from this forecast or anticipated in such forward-looking statements.
| Page 1 |
KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
OVERVIEW
Kidoz Inc. (TSXV:KDOZ) (OTCQB:KDOZF) Kidoz Inc. is a mobile advertising platform delivering high-attention in-app experiences for brands through deeply integrated technology infrastructure, without reliance on personal data tracking. Built to meet the strictest global compliance standards in children’s digital environments, where compliance and safety requirements are highest, the Company has a strong position in compliant advertising to kids and teens and is Google certified and Apple approved.
Kidoz is trusted by leading global brands to engage customers in safe, regulated mobile applications and games. The Company is increasingly competing for brand advertising budgets traditionally allocated to social and video platforms, as advertisers increasingly allocate budget toward mobile-first environments such as gaming.
At the core of the Company’s solution is the Kidoz Safe Ad Platform and Software Development Kit (“SDK”), integrated into thousands of applications worldwide. The platform combines contextual targeting and real-time signals to deliver interactive advertising experiences aligned with content, environment, and user context. The Company’s technology enables the delivery of purpose-built advertising experiences at defined moments within mobile applications and games. These experiences are designed to engage users at high-attention points and support measurable outcomes without reliance on personal data tracking. Mobile gaming environments represent a key channel, offering high-attention, brand-safe environments that are increasingly recognized as effective engagement media.
The Company’s vertically integrated technology stack and direct publisher integrations provide control over supply, pricing, and ad experience, differentiating it from intermediary-like advertising platforms
The Company’s core business in kids and teens compliant advertising continues to benefit from structural market trends, including increasing regulatory requirements, platform-level restrictions on data usage, and growing advertiser demand for compliant environments. Digital advertising directed toward younger audiences and family-safe ecosystems continues to expand.
The Company is also expanding beyond its core audience through Prado, its wholly owned division, which enables brands to reach broader demographic groups using the same contextual, privacy-based framework. Prado delivers campaigns through curated environments and purpose-built ad experiences aligned with content and user context. Prado has shown encouraging growth, and current go-to-market efforts are focused on consumer products and services.
References in this document to “the Company,” “we,” “us,” and “our” refer to Kidoz Inc.
The Company’s executive offices are located at Pacific Centre, Suite 1500, 701 West Georgia Street, Vancouver, British Columbia, V7Y 1C6, Canada. Our telephone number is (888) 374-2163.
| Page 2 |
KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
INCORPORATION AND NATURE OF OPERATIONS
Incorporation
Our common shares are currently quoted on the TSX Venture Exchange in Canada under the symbol “KDOZ”. We have not been subject to any bankruptcy, receivership or other similar proceedings.
Effective January 1, 2023, Kidoz Inc. continued out of the jurisdiction of the Anguillian Business Companies Act, 2022, and into the jurisdiction of the Canada Business Corporations Act (“CBCA”).
The Company was originally incorporated in the State of Florida on January 12, 1987.
On January 22, 2015, Bingo.com, Ltd., the name of the Company at that time, filed Articles of Amendment with the Anguilla Registrar of Companies changing its name to “Shoal Games Ltd.”. Effective at the open of markets on January 27, 2015, the Common Shares commenced trading under the new trading symbol “SGLDF” on the OTC-QB.
On June 29, 2015, the Company filed a TSX Venture Exchange Listing Application for the TSX Venture Exchange listing and commenced trading on July 2, 2015, under the symbol “SGW”.
On April 4, 2019, Shoal Games Ltd. filed Articles of Amendment with the Anguilla Registrar of Companies changing its name to “Kidoz Inc.”. Effective at the open of markets on April 9, 2019, the Common Shares commenced trading under the new trading symbol “KIDZ” on the TSX Venture Exchange. During the year ended December 31, 2025, the Company changed its trading symbol from “KIDZ” to “KDOZ” on the TSX Venture Exchange. This change strengthens the Company’s brand consistency across markets for the Company’s stock, in both Canada and the United States.
Effective June 9, 2025, the Company commenced trading on the OTCQB Venture Market under the symbol “KDOZF”. The Company’s common shares will continue to trade on the TSX Venture Exchange (the “TSXV”) under the symbol “KDOZ”.
Effective January 1, 2023, Kidoz Inc. continued out of the jurisdiction of the Anguillian Business Companies Act, 2022, and into the jurisdiction of the Canada Business Corporations Act (“CBCA”).
For the quarter ended June 30, 2026, we conducted our business through the Canadian incorporated entity and through our wholly-owned subsidiaries Kidoz Ltd. (“Kidoz Ltd.”), Shoal Media (Canada) Inc. (“Shoal Media Canada”), Shoal Media Inc. (“Shoal Media”), Prado Media Ltd. (“Prado Media”), and Shoal Media UK Ltd. (“Shoal Media UK”).
Shoal Media Canada was incorporated under the laws of British Columbia, Canada, on February 10, 1998, as 559262 B.C. Ltd. and changed its name to Bingo.com (Canada) Enterprises Inc. on February 11, 1999. It subsequently changed its name to English Bay Office Management Limited on September 8, 2003. Effective March 11, 2016, it changed its name to Shoal Media (Canada) Inc.
On January 1, 2013, 100% of the share capital of Shoal Media Inc., an Anguillian Company was acquired.
On October 25, 2016, Rooplay Media Ltd., was incorporated under the laws of British Columbia, Canada. During the year ended December 31, 2022, Rooplay Media Ltd. was renamed Prado Media Ltd.
On March 27, 2017, Shoal Media UK Ltd. was incorporated under the laws of England and Wales.
On July 12, 2017, Rooplay Media Kenya Limited was incorporated under the laws of Kenya. During the year ended December 31, 2024, Rooplay Media Kenya Limited was discontinued and struck off.
On March 4, 2019, the Company completed the acquisition of all of the issued and outstanding equity securities of Kidoz Ltd. (“Kidoz”) (www.kidoz.net), a privately held Israeli company.
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KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
BUSINESS OVERVIEW
Kidoz Inc. operates within a rapidly evolving digital advertising landscape, where increasing privacy regulation and the decline of user-level targeting are accelerating a shift toward contextual and high-attention media environments. Mobile gaming environments are emerging as an alternative channel for brand customer engagement, offering high levels of customer attention compared to passive social and video consumption.
At the core of Kidoz’s business is its proprietary Safe Ad Platform and SDK, seamlessly integrated into thousands of top-rated mobile apps. Kidoz delivers high-performance campaigns that comply with COPPA, GDPR-K, and other global privacy frameworks, without reliance on personal data tracking. Our advanced contextual targeting technology ensures brand messages are relevant, engaging, and delivered within a secure, brand-safe environment.
Prado represents the Company’s expansion into the broader all-ages digital advertising market, opening access to scaled programmatic demand, direct managed campaigns, and strategic partnerships across premium mobile environments. Prado offers advertisers a comprehensive and direct solution through its SSP, DSP, and Ad Exchange wholly owned technology, enabling high-efficiency media at scale buying across thousands of premium apps while maintaining Kidoz’s commitment to safety and quality.
With mobile usage continuing to outpace other digital channels, and as brands allocate media budgets from traditional platforms to mobile environments, Kidoz is well-positioned for continued growth. Our direct connections with publishers, supply path optimization, and human-curated ad placements differentiate Kidoz in an increasingly automated, yet regulation-heavy, market.
As a trusted partner for some of the world’s most respected brands, Kidoz continues to invest in its technology, compliance infrastructure, and global footprint, driving long-term value for advertisers, publishers, and shareholders alike.
Product Strategy
Kidoz builds and maintains the Kidoz Safe Ad Platform, the Kidoz SDK, Kite IQ and the Kidoz Privacy Shield, enabling app developers and global advertisers to reach children and families in a compliant and brand-safe way. The Kidoz SDK remains the core of our proprietary advertising technology. Direct SDK integration with publishers provides the Company with controlled, high-quality supply, a key differentiator versus open programmatic ecosystems. Our systems are fully compliant with COPPA, GDPR-K, and additional child privacy regulations worldwide, maintaining the highest required safety standards in the under 13 years of age industry.
During the year ended December 31, 2025 and continuing into the first half of fiscal 2026, Kidoz made a strategic increase in R&D spending to accelerate the enhancement of our systems and fully integrate advanced AI-driven capabilities (Kite IQ). These investments are designed to strengthen our competitive advantage, improve operational efficiency, and expand the scope of our platform offerings. Kidoz made continuous investments in its proprietary systems, further optimizing supply paths and enhancing performance through advanced integrations with IAB specifications for real-time bidding, header bidding, and server-to-server direct connections. These improvements not only support the kids’ marketplace but also broaden our reach across the entire digital advertising landscape.
Our managed programmatic solution, combined with direct connections to premium apps and programmatic demand sources, continues to be a key differentiator. Agency partners are increasingly utilizing our solutions to access high-quality mobile inventory at scale, benefiting from our enhanced efficiency, superior performance, and unwavering commitment to brand safety.
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KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
During 2025 and continuing into the first quarter of fiscal 2026, Prado (www.prado.co), our division for audiences over 13 years of age, has experienced increasing demand as a high-performance mobile SSP, DSP, and Ad Exchange. Prado’s programmatic capabilities now power large-scale campaigns across thousands of apps, simplifying digital advertising for agencies and brands targeting all ages. Kidoz engineers have ensured complete separation between Prado and our kid-safe platform, preserving the integrity of our child protection systems while enabling Kidoz to enter the broader, significantly larger digital ad market. Prado’s growth, alongside Kidoz’s internal safeguards, ensures that no inappropriate content ever reaches young audiences.
Marketing & Distribution Strategy
In 2025 and continuing into the first half of fiscal 2026, Kidoz strengthened its position as the trusted partner for leading global app publishers seeking compliant and high-performance monetization solutions, building a strong pipeline for the coming quarters and years. Our SDK has become an essential component for many of the world’s largest and most respected developers, who have integrated our technology into their platforms to ensure safe and effective advertising experiences for their users.
A key part of our strategy is an ongoing investment in compliance education and support for our partners. As regulations continue to evolve, Kidoz is proactively working with publishers to help them stay ahead of the curve. By aligning with Kidoz, developers gain not only access to premium demand and higher yields but also the reassurance that they are meeting the highest global privacy and safety standards.
This trusted reputation, combined with our focus on fostering direct relationships with top-tier publishers, has expanded our distribution footprint and further expanded Kidoz’s presence in the kids and all ages digital advertising ecosystem.
Sales & Pricing Strategy
Kidoz’s global agency partnership model continues to deliver success. In 2025 and continuing into the first half of fiscal 2026, Kidoz launched campaigns in 60 countries, reflecting the scalability and appeal of our solutions. Our strategy of recruiting top-tier international sales houses has been instrumental in building a reliable network of partners who recognize the value of Kidoz’s premium inventory. These partnerships have resulted in repeat campaigns and expanded allocations from major brands that increasingly shift larger portions of their media budgets to Kidoz.
As more brands experience our superior performance and efficiency, they deepen their investments with us. Our programmatic capabilities, in both Kidoz and Prado, open new opportunities for brands targeting parents and teens in addition to children, further diversifying our revenue streams and supporting our position in the digital advertising space.
Growth Strategy
Kidoz’s growth strategy is built on three core revenue engines: programmatic marketplaces, partner channels, and direct premium brand relationships, capitalizing on growing budget shifts toward contextual intelligence over identity-based tracking.
The Company’s programmatic business provides a foundation of scalable and stable recurring demand across both Kidoz and Prado networks. Through its proprietary infrastructure, including the Kidoz SDK and Kidoz Connect, the Company maintains direct integrations with publishers and demand partners, enabling efficient monetization of high-quality mobile inventory. These capabilities are further enhanced by Kite IQ, the Company’s contextual intelligence engine, which optimizes targeting, pricing, and delivery when user-level data is not available.
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KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
Complementing this, Kidoz is expanding its premium brand partnerships, working directly with leading global brands to deliver high-impact campaigns within mobile gaming environments. These campaigns leverage the Company’s controlled supply and high-attention ad formats, enabling deeper engagement and stronger performance. Kidoz Privacy Shield underpins these relationships by ensuring all campaigns are delivered without reliance on personal data, supporting compliance and privacy while maintaining campaign effectiveness.
Underlying both growth engines is a structural shift within the digital advertising market. As the availability of user-level data declines and identity-based targeting becomes less effective, advertisers are increasingly reallocating budgets toward contextual approaches. Kidoz’s platform is inherently aligned with this transition, combining contextual targeting, real-time signals, and curated environments to deliver performance without dependence on personal data tracking.
At the same time, behavioral and identity-based advertising models are facing increasing limitations due to platform policies and regulatory changes around personal data tracking. This is driving demand for solutions that can deliver performance in a privacy-resilient manner, positioning Kidoz and Prado to capture a growing share of advertising budgets.
Looking forward, the Company will continue to scale its programmatic demand, expand its premium brand partnerships, and invest in its proprietary technologies, including Kite IQ and Privacy Shield, to strengthen its position within the evolving digital advertising ecosystem.
Kidoz Original Equipment Manufacturer (“OEM”)
Kidoz’s mobile products include the Kid Mode Operating System (“OS”) installed on millions of OEM tablets worldwide. The Company earns license fees based on OEM agreements dependent on the number of devices where the Kidoz Kid Mode OS is installed. This business was discontinued in fiscal 2025; the Company no longer generates revenue from these agreements as we focus more on growing the Kidoz and Prado Advertising markets.
Rooplay
The Company owns Rooplay (www.rooplay.com) the cloud-based EduGame system for kids to play multiple games to learn and play. The platform is live on the Google’s Android system and has stand-alone games available on Apple’s iOS and Google’s Android systems.
OPERATIONS
Employees
As of June 30, 2026, we had 60 employees, consultants, and independent contractors throughout the world including twenty-seven full-time employees in Canada, Israel and the United Kingdom. Since 2006 it has been, and continues to be, the Company’s objective to control its costs by retaining consultants, as needed, to provide special expertise in developing internal strategic, marketing, accounting, and technical services. None of our employees or consultants are represented by a labor union, and we believe that our relationship with our employees and consultants is good.
We are substantially dependent upon the continued services and performance of J. M. Williams, Chief Executive Officer; Eldad Ben Tora, Chief Strategy Officer, President of the Prado division & General Manager EMEA, T. H. Williams, Chief Operating Officer and T. M. Williams, Chairman. The loss of the services of these key individuals would have a material adverse effect on our business, financial condition, and results of operations. We do not carry any key man life insurance on any individuals.
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KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
Competition
Kidoz operates within the digital advertising market. The Company focuses on delivering advertising within mobile gaming environments, which are increasingly recognized for their high levels of engagement and attention. Gaming environments offer a fundamentally different engagement model compared to traditional social and video platforms such as YouTube and Instagram. While these platforms are largely characterized by continuous scrolling and passive content consumption, mobile gaming involves active user participation, where attention is directed and sustained. This enables advertising to be delivered at defined, high-attention moments within the user experience, rather than alongside rapidly consumed content streams, resulting in deeper engagement and improved campaign effectiveness and brand outcomes
Advertisers are seeking environments that combine performance, privacy, and brand safety, particularly as the industry continues to evolve beyond reliance on user-level data. Kidoz addresses this demand by enabling advertising within curated, high-quality mobile environments, where campaigns are delivered at defined moments of user engagement rather than alongside passive content consumption.
A key differentiator of the Company is its vertically integrated technology infrastructure and direct publisher integrations. Through its SDK, Kidoz maintains direct relationships with application developers, providing control over supply quality, pricing, and ad experience. This contrasts with many participants in the programmatic ecosystem that operate as intermediaries, relying on aggregated or resold inventory with limited control over delivery and performance. As a result, intermediary-driven platforms are more exposed to pricing pressure and potential disintermediation, while Kidoz’s direct integration model supports greater consistency, resilience, and scalability.
In the broader programmatic market, Prado competes with large-scale behavioral and performance-driven networks, including platforms such as AppLovin and similar demand-side and supply-side solutions that also rely on user-level data and behavioral targeting. While these platforms offer scale and automation, they are primarily optimized for identity-based targeting models.
Prado differentiates itself through a contextual approach, delivering campaigns based on content, environment, and real-time signals rather than user-level data. This approach is increasingly aligned with industry trends as advertisers adapt to evolving privacy standards and reduced availability of deterministic user identifiers and tracking. By combining contextual intelligence with curated mobile inventory, Prado enables advertisers to achieve performance while operating within a more sustainable and privacy-resilient framework.
HIGHLIGHTS FOR THE THREE MONTHS ENDED JUNE 30, 2026
| ● | Tarrnie Williams Jr. was appointed Chief Operating Officer. | |
| ● | The Company paid its annual bonuses and incentive compensation to its employees, consultants, and independent contractors |
Events Subsequent to June 30, 2026
Subsequent to the quarter ended June 30, 2026, the following events occurred:
| ● | 200,000 options at CAD$0.66 per option expired unexercised. |
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KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
SUMMARY CONSOLIDATED FINANCIAL INFORMATION
The summary unaudited condensed interim consolidated financial information set out below has been prepared in accordance with US GAAP and is derived from the Company’s unaudited condensed interim consolidated financial statements for the period ended June 30, 2026 and the audited consolidated financial statements and accompanying notes for the years ended December 31, 2025 and can be found at www.sedar.com.
In the second quarter of 2026, the Company reclassified certain content and software development costs related to the Company’s server costs from content and software development to cost of sales and reclassified bonuses and incentive compensation from salaries, wages, consultants and benefits, selling and marketing and content and development expenses to bonuses and incentive compensation. These reclassifications had no impact on the Company’s Condensed Consolidated Balance Sheets, Condensed Consolidated Statements of Earnings and Comprehensive Income, Condensed Consolidated Statements of Stockholders’ Equity or Condensed Consolidated Statements of Cash Flow. The financial results for the three and six months ended June 30, 2025 have been recast for comparison purposes and to conform to the current period classification. The reclassification did not have any impact on the total income from operations.
Consolidated Balance Sheet Data:
| June 30, 2026 | December 31, 2025 | |||||||
| Cash | $ | 1,328,558 | $ | 4,454,295 | ||||
| Total assets | 8,928,468 | 13,173,133 | ||||||
| Total liabilities | 2,574,882 | 4,535,852 | ||||||
| Total stockholders’ equity | 6,353,586 | 8,637,281 | ||||||
| Working capital | 2,886,235 | 5,080,637 | ||||||
Cash has decreased for the quarter ended June 30, 2026, compared to cash as at December 31, 2025, due to expenses incurred during the first and second quarter of fiscal 2026. As part of Kidoz’s planned compensation program, annual performance bonuses were paid in the second quarter, reflecting the Company’s exceptional results in 2025. These awards, which are determined in advance based on the prior year’s performance, contributed to higher expenses in the quarter but are non-recurring in nature. Total assets and total liabilities have declined due to paying down of our liabilities in the quarter ended March 31, 2026 and June 30, 2026.
Total stockholders’ equity and working capital has decreased due to bonuses and expenses incurred by the Company for the quarter ended June 30, 2026.
Consolidated Cash flow data:
| June 30, 2026 | June 30, 2025 | |||||||
| Net cash used in operating activities | $ | (3,122,684 | ) | $ | (346,020 | ) | ||
| Net cash (used in) provided by investing activities | (3,053 | ) | (7,690 | ) | ||||
| Net cash used in financing activities | - | - | ||||||
| Change in cash | (3,125,737 | ) | (353,710 | ) | ||||
| Cash | $ | 1,328,558 | $ | 2,426,807 | ||||
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KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
Consolidated Statement of Operations Data for continuing operations:
Six Months ended June 30, 2026 | Six Months ended June 30, 2025 | Three Months ended June 30, 2026 | Three Months ended June 30, 2025 | |||||||||||||
| Revenue: | $ | 6,281,576 | $ | 5,168,519 | $ | 3,334,835 | $ | 2,430,216 | ||||||||
| Cost of sales | 3,607,888 | 2,684,203 | 1,916,253 | 1,268,244 | ||||||||||||
| Gross profit | 2,673,688 | 2,484,316 | 1,418,582 | 1,161,972 | ||||||||||||
| Bonuses and incentive compensation | 862,863 | 687,728 | 862,863 | 687,728 | ||||||||||||
| Total operating expenses | 4,192,242 | 2,980,546 | 2,122,572 | 1,647,886 | ||||||||||||
| Income tax (recovery) expense | (8,510 | ) | (72,618 | ) | (8,510 | ) | (2,159 | ) | ||||||||
| Loss after tax | $ | (2,372,907 | ) | $ | (1,111,340 | ) | $ | (1,558,343 | ) | $ | (1,171,483 | ) | ||||
| Loss per share – basic and diluted | $ | (0.02 | ) | $ | (0.01 | ) | $ | (0.01 | ) | $ | (0.01 | ) | ||||
DISCUSSION OF OPERATIONS AND OPERATIONAL HIGHLIGHTS
Overall Performance for the Three months ended June 30, 2026 and 2025.
Revenue
Total revenue, net of platform fees (to Apple, and Google) and withholding taxes, for the quarter ended June 30, 2026, increased to $3,334,524, an increase of 13% from revenue of $2,946,741 for the first quarter of 2026 and an increase of 37% from revenue of $2,430,216 for the second quarter of 2025.
The increase in total revenue compared to the first quarter of fiscal 2026 and the second quarter of fiscal 2025 is the result of our initiatives to create high-performance advertising solutions in gaming apps.
Selling and marketing expenses
Selling and marketing expenses were $665,828 for the quarter ended June 30, 2026, an increase of 6% over expenses of $626,100 in the first quarter of fiscal 2026 and an increase of 50% over expenses of $444,520 in the second quarter of fiscal 2025. We made significant investment in our sales and marketing team to manage the anticipated growth in the Direct, Programmatic and Performance segments of our Ad tech business. Selling and marketing expenses consist primarily of sales staff salaries, sales commissions, benefits and publishing services.
We expect to incur increased sales and marketing expenses in selling the Ad tech advertising and to grow the Ad tech advertising revenue. There can be no assurances that these expenditures will result in increased traffic or significant additional revenue.
Software technology development
We do not capitalize our development costs. The Company expensed $895,692 in content and software development costs during the quarter ended June 30, 2026, a decrease of 4% compared to content and software development costs of $933,203 expensed during the first quarter of fiscal 2026 and an increase of 10% compared to content and software development costs of $816,152 expensed during the second quarter of fiscal 2025. The decrease compared to the first quarter of fiscal 2026, is due to lower outsourced technology development as a result of improved efficiencies as a result of AI initiatives. The increase over the second quarter of fiscal 2025, is due to the hiring of additional development staff to increase the development of our base technologies including the development of the Kidoz Shield and to make our technology more robust and scalable as we continue to grow.
The majority of our software development costs are salaries, wages, and benefits for our employees and consultants. In addition, as we have expanded our global reach, our overall server costs have increased.
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KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
General and administrative expenses
General and administrative expenses consist primarily of premises costs for our offices, legal and professional fees, and other general corporate and office expenses. General and administrative expenses decreased to $222,382 for the quarter ended June 30, 2026, a decrease of 4% from costs of $231,539 for the first quarter of fiscal 2026 and an increase of 28% from costs of $173,297 in the second quarter of fiscal 2025. The decrease in general and administrative expenses compared to the first quarters of fiscal 2026 was primarily driven by higher travel costs incurred for a company-wide cross-departmental meeting in the first quarter of fiscal 2026 intended to improve efficiencies across the organization. The increase compared to the second quarter of fiscal 2025 is due to an increase in AI related expenses and conferences attended in the second quarter of fiscal 2026.
We expect to continue to incur general and administrative expenses to support the business, and there can be no assurances that we will be able to generate sufficient revenue to cover these expenses.
Salaries, wages, consultants, and benefits
Salaries, wages, consultants, and benefits decreased to $202,500 for the quarter ended June 30, 2026, compared to salaries, wages, consultants, and benefits of $203,471 in the first quarter of fiscal 2026 and an increase of 91% compared to salaries, wages, consultants, and benefits of $105,884 in the second quarter of fiscal 2025. This increase compared to the second quarter of fiscal 2025 is due to an increase in the rate of pay and an increase in the number of consultants.
Bonuses and incentive compensation
Bonuses and incentive compensation increased to $862,863 for the quarter ended June 30, 2026, compared with $687,728 for the second quarter of fiscal 2025. Bonuses and incentive compensation are generally paid annually during the second quarter and are primarily based on the Company’s financial and operational performance for the preceding fiscal year. The increase was primarily attributable to an increase in the number of employees eligible for incentive compensation and the timing of recognition of bonus expense. A portion of the bonuses paid in fiscal 2025 had been accrued and expensed in fiscal 2024 and, accordingly, did not impact expense in the second quarter of fiscal 2025. No comparable accrual was recorded in fiscal 2025 for bonuses paid in fiscal 2026, resulting in a greater proportion of the fiscal 2026 bonus expense being recognized in the second quarter of fiscal 2026.
Depreciation and amortization
Intangible assets are amortized using a straight-line method over three to eight years. These intangible assets include customer lists, and the software development kits (SDK) for our advertising platform. These intangible assets are as result of the acquisition of Kidoz Ltd. The amortization for the quarter ended June 30, 2026, was $42,564, compared to amortization of $42,564 in the first quarter of fiscal 2026 and the second quarter of fiscal 2025.
Equipment is depreciated using the declining balance method over the useful lives of the assets, ranging from three to five years. Depreciation and amortization increased to $3,412, during the quarter ended June 30, 2026, a decrease over costs of $3,514 during the first quarter of fiscal 2026 and costs of $3,031 in the second quarter of fiscal 2025. This decrease in depreciation and amortization compared to the first quarter of fiscal 2026 is due the write off of old equipment in the first quarter of fiscal 2026. The increase in depreciation and amortization compared to the second quarter of fiscal 2025 is due to the acquisition of equipment for our new staff.
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KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
Stock-based compensation expense
During the quarter ended June 30, 2026, the Company incurred non-cash stock-based compensation expenses of $44,174 from the issuance of stock options granted in prior years, a decrease of 2% compared to stock-based compensation expense of $45,038 in the first quarter of fiscal 2026 and a decrease of 3% compared to stock-based compensation expense of $45,581 in the second quarter of fiscal 2025. The decreases compared with both periods were primarily attributable to the cancellation of certain unvested stock options during the quarter following the departure of employees from the Company. The options are issued to consultants and employees as per the Company’s 2015 and 2025 Stock Option Plans and are a significant component of the Companies overall compensation plan.
Net (loss) income and (loss) income per share
The net loss after taxation for the quarter ended June 30, 2026, amounted to ($1,558,343), a loss of ($0.02) per share, and a reduction compared to a net loss after taxation of ($814,564) or $0.01 per share in the frist quarter of fiscal 2026 and a reduction compared to a net loss after taxation of ($1,171,482) or $0.01 per share in the second quarter of fiscal 2025. This increase in net loss compared to the first quarter of fiscal 2026 and the second quarter of fiscal 2026 is due to an performance bonuses and increased in headcount.
Net Cash generated from Operations and Adjusted EBITDA
Due to our focus on maintaining a strong balance sheet while striving to continue our rapid growth on an annual basis and to evaluate our performance and make financial and operational decisions accordingly we pay close attention to our net cash generated from operations and our adjusted EBITDA.
Our net cash used in operations for the quarter ended June 30, 2026, was ($3,122,684) compared to cash used of ($346,020) in the prior year.
Adjusted earnings before interest; depreciation and amortization; stock awareness program; stock-based compensation and impairment of goodwill (“Adjusted EBITDA”) for the period ended June 30, 2026, amounted to ($1,483,822), a reduction compared to an Adjusted EBITDA of ($736,720) in the first quarter of fiscal 2026 and a reduction compared to an Adjusted EBITDA of ($1,088,229) in the second quarter of fiscal 2025.
Our Adjusted EBITDA is reconciled as follows:
Six Months ended June 30, 2026 | Six Months ended June 30, 2025 | Three Months ended June 30, 2026 | Three Months ended June 30, 2025 | |||||||||||||
| Loss after tax | $ | (2,372,907 | ) | $ | (1,111,340 | ) | $ | (1,558,343 | ) | $ | (1,171,483 | ) | ||||
| Less : | ||||||||||||||||
| Depreciation and amortization | 92,054 | 90,955 | 45,976 | 45,595 | ||||||||||||
| Income tax (recovery) expense | (8,510 | ) | (72,618 | ) | (8,510 | ) | (2,159 | ) | ||||||||
| Interest and other income | (20,391 | ) | (6,238 | ) | (7,119 | ) | (5,764 | ) | ||||||||
| Stock-based compensation | 89,212 | 89,449 | 44,174 | 45,581 | ||||||||||||
| Adjusted EBITDA | $ | (2,220,542 | ) | $ | (1,009,792 | ) | $ | (1,483,822 | ) | $ | (1,088,229 | ) | ||||
We use Adjusted EBITDA internally to evaluate our performance and make financial and operational decisions that are presented in a manner that adjusts from their equivalent GAAP measures or that supplement the information provided by our GAAP measures. Adjusted EBITDA is defined by us as EBITDA (net income (loss) plus depreciation expense, amortization expense, interest, stock-based compensation, and impairment of goodwill), further adjusted to exclude certain non-cash expenses and other adjustments. We use Adjusted EBITDA because we believe it more clearly highlights business trends that may not otherwise be apparent when relying solely on GAAP financial measures, since Adjusted EBITDA eliminates from our results specific financial items that have less bearing on our core operating performance.
Adjusted EBITDA is not presented in accordance with, or as an alternative to, GAAP financial measures and may be different from non-GAAP measures used by other companies. These non-GAAP measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with generally accepted accounting principles in the United States of America (“GAAP”). We encourage investors to review the GAAP financial measures included in this Annual Report, including our consolidated financial statements, to aid in their analysis and understanding of our performance and in making comparisons.
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KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
SUMMARY OF QUARTERLY RESULTS
The following tables present our unaudited consolidated quarterly results of operations for each of our last eight quarters. This data has been derived from unaudited consolidated financial statements that have been prepared on the same basis as the annual audited consolidated financial statements and, in our opinion, include all normal recurring adjustments necessary for the fair presentation of such information. These unaudited quarterly results should be read in conjunction with our audited consolidated financial statements.
| Three Months Ended | ||||||||||||||||
| June 30, 2026 | March 31, 2026 | December 31, 2025 | September 30, 2025 | |||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||
| Revenue | $ | 3,334,835 | $ | 2,946,741 | $ | 9,598,132 | $ | 3,666,521 | ||||||||
| Cost of sales | 2,322,532 | 1,691,635 | 5,655,247 | 2,080,214 | ||||||||||||
| Gross profit | 1,021,303 | 1,255,106 | 3,942,886 | 1,586,307 | ||||||||||||
| Operating expenses and other income / (expenses) | (1,621,181 | ) | (2,088,526 | ) | (2,016,124 | ) | (1,702,357 | ) | ||||||||
| Bonuses and incentive compensation | (862,863 | ) | - | - | - | |||||||||||
| Provision for doubtful receivables | (65,604 | ) | 53 | (86,862 | ) | (16,949 | ) | |||||||||
| Stock awareness program | 16,468 | 64,881 | - | - | ||||||||||||
| Depreciation and amortization | (45,976 | ) | (46,078 | ) | (46,326 | ) | (45,667 | ) | ||||||||
| (Loss) Income before income taxes | (1,566,853 | ) | (814,564 | ) | 1,793,573 | (178,666 | ) | |||||||||
| Income tax recovery (expense) | 8,510 | - | (47,705 | ) | 955 | |||||||||||
| (Loss) Income after tax | $ | (1,558,343 | ) | (814,564 | ) | 1,745,868 | (177,711 | ) | ||||||||
| Basic and diluted (loss) income per share | $ | (0.01 | ) | $ | (0.01 | ) | $ | 0.01 | $ | (0.00 | ) | |||||
| Weighted average common shares, basic | 131,304,499 | 131,304,499 | 131,304,499 | 131,304,499 | ||||||||||||
| Weighted average common shares, diluted | 131,304,499 | 131,304,499 | 131,304,499 | 131,304,499 | ||||||||||||
| Three Months Ended | ||||||||||||||||
| June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30 2024 | |||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||
| Revenue | $ | 2,430,216 | $ | 2,738,303 | $ | 7,444,505 | $ | 2,287,776 | ||||||||
| Cost of sales | 1,268,244 | 1,415,959 | 3,449,433 | 1,223,238 | ||||||||||||
| Gross profit | 1,161,972 | 1,322,344 | 3,995,072 | 1,064,538 | ||||||||||||
| Operating expenses and other income / (expenses) | (1,602,290 | ) | (1,287,301 | ) | (1,811,059 | ) | (1,425,509 | ) | ||||||||
| Bonuses and incentive compensation | (687,728 | ) | - | - | - | |||||||||||
| Provision for doubtful receivables | - | - | (114,480 | ) | - | |||||||||||
| Depreciation and amortization | (45,595 | ) | (45,360 | ) | (45,377 | ) | (45,313 | ) | ||||||||
| Income (Loss) before income taxes | (1,173,641 | ) | (10,317 | ) | 2,024,156 | (406,284 | ) | |||||||||
| Income tax recovery (expense) | 2,159 | 70,459 | (159,499 | ) | - | |||||||||||
| Income (Loss) after tax | $ | (1,171,482 | ) | 60,142 | 1,864,657 | (406,284 | ) | |||||||||
| Basic and diluted Income (loss) per share | $ | (0.01 | ) | $ | (0.01 | ) | $ | 0.01 | $ | (0.00 | ) | |||||
| Weighted average common shares, basic | 131,304,499 | 131,304,499 | 131,304,499 | 131,304,499 | ||||||||||||
| Weighted average common shares, diluted | 131,304,499 | 131,304,499 | 131,304,499 | 131,304,499 | ||||||||||||
| Page 12 |
KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
LIQUIDITY AND CAPITAL RESOURCES
The Company generates cash from operations.
The Company believes it has sufficient cash resources to meet its current growth and development objectives. Although the Company has relied on revenue generated through its business, external funding may be required to continue growing the existing business and scaling operations. There can be no assurance that adequate funding will be available in the future, or under terms that are favorable to the Company.
We had cash of $1,328,558 and working capital of $2,886,235 as at June 30, 2026. This compares to cash of $4,454,295 and working capital of $5,080,637 as at December 31, 2025.
During the six months ended June 30, 2025, we used cash of ($3,122,684) in operating activities compared to using cash of ($346,020) in the prior year.
During the six months ended June 30, 2026, we used cash in investing activities of ($3,053) compared to cash used investing activities of ($7,690) in the same period in the prior year.
Net cash used in financing activities was $nil in the six months ended June 30, 2026. This compares to cash used in financing activities of ($nil) in the same period in the prior year.
Our future capital requirements will depend on several factors, including costs associated with the further development of the Ad tech advertising business, the cost of marketing and customer acquisition costs, the development of new products, the acquisition of new companies and the success of our overall business.
SHARE CAPITAL
Outstanding share data
The Company is authorized to issue unlimited number of common shares without par value.
As at the date of this MD&A, the Company had the following issued and outstanding:
| ● | 131,304,499 common shares | |
| ● | 8,427,083 share purchase options with an approximate weighted average exercise price of $0.22. Each stock option is exercisable to purchase one common share of the Company at prices ranging from CAD$0.20 to CAD$0.50. | |
| ● | nil RSU’s, nil PSU’s and nil DSU’s. |
Common shares
As at June 30, 2026, there were 131,304,499 (December 31, 2025 – 131,304,499) common shares outstanding.
No shares were issued or acquired during the period ended June 30, 2026.
Stock Options
In 2015, the shareholders approved the 2015 Rolling Stock Option plan. Under the 2015 plan we have reserved 10% of the number of Shares of the Company issued and outstanding as of each Award Date.
During the year ended December 31, 2024, a new 10% “rolling” stock option plan (the “2024 Stock Option Plan”) that complies with the updated TSX Policy 4.4 was approved by the TSX-V, the Board of Directors and the Company’s shareholders. The 2024 Stock Option Plan will replace 2015 Stock Option Plan. Options granted under the 2015 Stock Option Plan will continue to be governed by the 2015 Stock Option Plan. The 2015 Stock Option plan will continue to exist until the stock options granted under the 2015 Stock Option are exercised, cancelled or expire. All new stock option grants will be made under the 2024 Stock Option Plan.
Pursuant to this plan we have 8,627,083 stock purchase options (December 31 2025 - 10,477,683) outstanding at June 30, 2026.
During the quarter ended June 30, 2026, there were nil options granted (June 30, 2025 – nil), nil (June 30, 2025 – nil) options exercised, 1,006,000 options at CAD$1.02 (US$081) expired unexercised (June 30, 2025 - 1,930,400) and 55,000 (June 30, 2025 – nil) options cancelled.
During the year ended December 31, 2025, 2,158,333 options were granted to directors, employees and consultants with an exercise price of CAD$0.25 ($0.18) where 2% vests per month. 1,056,250 options of these options were granted to directors and officers of the Company.
| Page 13 |
KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
The Equity Awards Plan:
During the quarter ended March 31, 2025 the Company initiated The Equity Awards Plan to complement the 2024 Stock Option Plan as an integral part of the Companies overall compensation plan.
The Equity Awards Plan is a fixed 10% plan under which the Company may issue such number of security-based compensation (other than options) up to 10% of the issued and outstanding shares as of the date the Equity Awards Plan is implemented.
The plan is subject to the following limits (in addition to the 10% fixed cap) for so long as the Shares are listed and posted for trading on the TSXV: (i) not more than two (2%) percent of the Company’s issued and outstanding Shares, inclusive of Shares issuable pursuant to all Security Based Compensation granted or issued, may be granted to any one Consultant in any 12 month period; (ii) unless the Company has obtained Disinterested Shareholder Approval, not more than five (5%) percent of the Company’s issued and outstanding Shares, inclusive of Shares issuable pursuant to all Security Based Compensation granted or issued, may be issued to any one Person in any 12 month period; (iii) Investor Relations Service Providers shall not be eligible to receive any Awards; (iv) the aggregate number of Shares issuable to Insiders at any time under this Plan, inclusive of Shares issuable pursuant to all Security Based Compensation granted or issued, unless the Company has obtained Disinterested Shareholder Approval, shall not exceed ten (10%) percent of the Company’s issued and outstanding Shares; (v) the aggregate number of Shares issuable to Insiders within any one (1) year period under this Plan, inclusive of Shares issuable pursuant to all Security Based Compensation granted or issued, unless the Company has obtained Disinterested Shareholder Approval, shall not exceed ten (10%) percent of the Company’s issued and outstanding Share.
The Equity Awards Plan has been approved by the Toronto Venture Stock Exchange (“TSXV”) and the Company’s Shareholders at the 2025 Annual General Shareholder meeting. No grants were made in the quarter ended June 30, 2026.
OFF-BALANCE SHEET ARRANGEMENTS
The Company has no off-balance sheet arrangements that have or are reasonably likely to have a current or future material adverse effect on its financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.
COMMITMENTS
The Company leases office facilities in Netanya, Israel. This office facility is leased under operating lease agreements.
During the period ended March 31, 2024, the lease on the Vancouver office expired and was not renewed. Our Canadian staff continue to work on a virtual basis. The minimum lease payments under these leases are approximately as follows:
| 2026 | $ | 11,474 |
The Company has the following management consulting agreements with related parties.
| Company | Person | Role | Annual amount | |||||||
| T.M. Williams (ROW), Inc. | T. M. Williams | Chairman | $ | 220,437 | ||||||
| - | Jason Williams | CEO | $ | 231,498 | ||||||
| Bromley Accounting Services Ltd. | H. W. Bromley | CFO | $ | 220,488 | ||||||
| Farcast Operations Inc. | T. H. Williams | COO | CAD$314,800 | |||||||
| Page 14 |
KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
RELATED PARTY TRANSACTIONS
As at and for the period ended June 30, 2026, the Company has the following related party transactions:
Six Months ended June 30, 2026 | Six Months ended June 30, 2025 | Three Months ended June 30, 2026 | Three Months ended June 30, 2025 | |||||||||||||
| Bonuses and incentive compensation | 307,587 | 466,680 | 307,587 | 466,680 | ||||||||||||
| Directors fees | $ | 4,077 | $ | 5,051 | $ | 2,066 | $ | 1,556 | ||||||||
| Salaries, wages, consultants and benefits | 326,285 | 205,723 | 152,272 | 99,574 | ||||||||||||
| Selling and marketing | 93,195 | 135,040 | 52,331 | 53,944 | ||||||||||||
| Stock-based compensation | 37,205 | 34,333 | 18,424 | 17,381 | ||||||||||||
| Software technology development | 196,402 | 146,223 | 104,106 | 103,576 | ||||||||||||
| Closing balance for the period | $ | 964,751 | $ | 993,050 | $ | 636,786 | $ | 742,711 | ||||||||
The Company has liabilities of $93,059 (December 31, 2025 - $81,840) as at June 30, 2026, to current directors, officers and companies owned by the current directors and officers of the Company for employment, director and consulting fees.
No options were granted during the quarter ended June 30, 2026.
The related party transactions are in the normal course of operations and were executed at the currency exchange amount, which is the amount of consideration established and agreed to by the related parties.
ACCOUNTING POLICY CHANGES, CRITICAL ESTIMATES, JUDGMENTS AND ASSUMPTIONS
The information provided in this MD&A, including the consolidated financial statements, is the responsibility of management. The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. There is a full disclosure and description of the Company’s critical accounting policies, estimates, judgments, assumptions in the Condensed Interim Consolidated Financial Statements as at June 30, 2026 in notes 1 and 2.
Significant areas requiring the use of estimates include the collectability of accounts receivable, the valuation of stock-based compensation, the valuation of deferred tax assets and liabilities, and the useful lives of intangible assets. Actual results may differ significantly from these estimates.
The following discussion of critical accounting policies is intended to supplement the Summary of Significant Accounting Policies presented as Note 2 to our audited consolidated financial statements presented elsewhere in this report. Note 2 summarizes the accounting policies and methods used in the preparation of our consolidated financial statements.
We consider the following accounting policies to be both those most important to the portrayal of our financial condition and require the most subjective judgment:
- Revenue recognition;
- Software technology development;
- Impairment of long-lived assets;
- Goodwill
These policies were selected because they require the more significant judgments and estimates in the preparation and presentation of our financial statements. On an ongoing basis, management evaluates these judgments and estimates, including whether there are any uncertainties as to compliance with the revenue recognition criteria described below, and recoverability of long-lived assets, as well as the assessment as to whether there are contingent assets and liabilities that should be recognized or disclosed for the consolidated financial statements to fairly present the information required to be set forth therein. We base our estimates on historical experience, as well as other events and assumptions that are believed to be reasonable at the time. Actual results could differ from these estimates under different conditions.
| Page 15 |
KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
NEW ACCOUNTING PRONOUCEMENTS AND CHANGES IN ACCOUNTING POLICIES
In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. The new standard requires entities to disclose additional information about certain expenses, such as purchases of inventory, employee compensation, depreciation, intangible asset amortization, as well as selling expenses included in commonly presented expense captions on the income statement. The FASB further clarified the effective date in January 2025 with the issuance of ASU 2025-01, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date. The ASU is effective for fiscal years beginning after December 15, 2026, and interim periods beginning after December 15, 2027. Companies have the option to apply this guidance either on a retrospective or prospective basis, and early adoption is permitted. The company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements and related disclosures.
In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use amendments remove references to prescriptive software development stages and clarify that Software, to simplify and modernize the accounting for internal-use software costs. The capitalization of eligible software development costs begins when management authorizes and commits to funding the project and it is probable the project will be completed, and the software will be used as intended. The amendments in this update are effective for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual periods. Early adoption is permitted, and the guidance may be applied prospectively, retrospectively, or using a modified approach for in-process projects. The Company is evaluating the impact this guidance will have on the consolidated financial statements and related disclosures.
In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements, which clarifies the applicability of the interim reporting guidance, the types of interim reporting, and the form and content of interim financial statements in accordance with U.S. GAAP. Per the FASB, the amendment does not intend to change the fundamental nature of interim reporting or expand or reduce current interim disclosure requirements but rather provide clarity and improve navigability of the existing interim reporting requirements. The amendments will be effective for interim reporting periods within annual reporting periods beginning after December 15, 2027. The amendments may be applied prospectively or retrospectively, and early adoption is permitted. The Company is currently evaluating this ASU to determine its impact on the Company’s disclosures.
The Company has evaluated all the recently issued, but not yet effective, accounting standards that have been issued or proposed by the Financial Accounting Standards Board or other standards-setting bodies through the filing date of these consolidated financial statements and does not believe the future adoption of any such pronouncements will have a material impact on its consolidated financial statements.
| Page 16 |
KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
FINANCIAL INSTRUMENTS AND OTHER INSTRUMENTS
The Company is exposed to various financial risks resulting from both its operations. The Company does not enter into financial instrument agreements including derivative financial instruments for speculative purposes. The fair values of the Company’s financial instruments approximate the carrying values, due to their short terms to maturity or attached market rates of interest. The Company is exposed to various risks related to its financial instruments as follows:
| (i) | Market risk |
Market risk is the risk that changes in market prices, such as interest rates and foreign exchange rates, will affect the Company’s net income and the value of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable limits, while maximizing returns.
| (ii) | Foreign exchange risk |
The Company has exposure to foreign exchange risk which is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. Foreign exchange risk arises when future commercial transactions and recognized assets and liabilities are denominated in a currency that is not the Company’s functional currency. The Company has not entered into foreign exchange purchase contracts to manage its foreign exchange risk, because, in management’s view, the cost of setting up the contracts is in excess of the risks associated with a sudden change in the exchange rates. Management continually monitors the exchange rates and will enter into risk prevention measures when warranted. The Company is also exposed to foreign exchange risk on its cash, accounts receivable and accounts payable balances that are mostly denominated in U.S. dollars and Euros, whereas our employment and consulting costs are mostly denominated in Israeli Shekels, British Pounds, Canadian Dollars, and US Dollars.
| (iii) | Credit Risk |
Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation. The Company is subject to credit risk with respect to cash and accounts receivable. The Company’s maximum exposure to credit risk at the end of the reporting period is the carrying value of these assets. Credit risk is managed through a credit approval process and monitoring procedures, and there are no expected credit losses.
All cash balances are held at a major banking institutions in Israel, United Kingdom and Canada and management believes the risk of loss to be remote.
| (iv) | Liquidity risk |
Liquidity risk is the risk that arises when the maturity of assets and the maturity of liabilities do not match. An unmatched position potentially enhances profitability but can also increase the risk of loss. The Company’s liquidity needs can be met through a variety of sources. The Company generates cash from operations, and in the past by issuances of common shares. The Company manages liquidity risk by maintaining sufficient cash balances to meet liabilities when due and by continuously monitoring actual and forecast cash flows.
| Page 17 |
KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
RISKS AND UNCERTAINTIES
The Company’s business is subject to numerous risks and uncertainties, including those described elsewhere in this MD&A, as well as general economic and market risks. The following discussion describes material risks and uncertainties that the Company has identified that may affect the Company’s results of operations and financial condition.
Risks Related to the Business
| ● | Regulations - The Company operates in a highly regulated market with a Children’s Online Privacy Protection Rule (“COPPA”) & General Data Protection Regulation (“GDPR”). There is the risk that the regulations restrict the Company operations. The Company serves compliant contextual mobile advertising network that safely reaches hundreds of million kids, teens, and families every month. | |
| ● | Reliant on Google and Apple - The Company is heavily reliant on Google and Apple, on whose platform the games where we advertise are hosted. The Company has been Google certified and has been approved by Apple. | |
| ● | Expanding Company - the Company is a growing and expanding company. The Company’s revenues may be materially affected by the decisions of its management and/or customers, and due to a variety of other factors, many of which may be beyond the Company’s control. This may lead to expenses exceeding estimates or be incurred in the expectation of sales that do not occur or that occur later than expected. Management expects expenses to increase, especially hiring of additional staff to support its growth and expansion. Fluctuating results could cause unanticipated quarterly losses and cause the Company’s performance to fall below the expectations of investors, which could adversely affect the price of the common shares. The following will cause fluctuating results: |
| ○ | Changes in demand for Kidoz Platform | |
| ○ | Changes in the Company’s customer base, additions and losses of customers | |
| ○ | Changes in advertising budgets of our customers | |
| ○ | Changes in the availability of advertising inventory or in the cost of reaching customers through digital advertising. | |
| ○ | Disruptions or outages on the Kidoz platform. | |
| ○ | New technology or offering by the Kidoz competitors. | |
| ○ | Timing differences between our payments for advertising inventory and our collection of advertising revenue. | |
| ○ | Shifting views and behaviors of consumers concerning use of data. |
Based upon the factors above and others beyond the Company’s control, Kidoz forecasts future revenue, costs and expenses, and continually reviews these forecasts. As a result, its operating results may, from time to time, fall below estimates or the expectations of securities analysts and investors.
| ● | Managing growth - The Company has expanded rapidly over the last few years. The continued rapid growth of the Company may strain management, financial, technical, and other resources. The Company must expand its sales, marketing, technology, and operational staff and expand its controls. If Kidoz continues its rapid growth, it will incur additional expenses, and its growth may continue to place a strain on resources, infrastructure, and ability to maintain the quality of its offering. Accordingly, the Company may not be able to effectively manage and coordinate growth so as to achieve or maximize future profitability. |
| Page 18 |
KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
| ● | Reliance on Key Customers - The Company is reliant on a relatively few customers and sales houses. The loss of a significant customer could harm the Company’s business and severely impact the future financial success of the Company. The Company is continually looking for new customers and sales houses around the world to partner with. | |
| ● | Retaining and attracting customers - The Company, to continue to grow, must attract new customers and encourage existing advertisers to purchase additional offerings. Our competitors may introduce lower costs or differentiated products or services that compete with our current offering on price or technology and therefore impacting our sales. The Company has hired additional sales staff and is continually developing its technology. | |
| ● | No long-term customer commitments - The Company does not have any long term commitments by its customers beyond the current insertion order, which can be cancelled prior to the campaign conclusion without any penalty. Therefore, the Company success is dependent on offering the best service and maintaining good customer relations. The Company allocates customer service personnel to manage the customer relationship. | |
| ● | Reliance on third parties - the Company is reliant on third parties to operate. These third parties include cloud-based servers located around the world, external sales houses, outsourced technology developers, advertising exchanges and other strategic partners. If these third parties fail to perform as agreed could negatively affect our operations. | |
| ● | Personnel - The loss of any member of the Company’s management team, could have a material adverse effect on its business and results of operations. The Company relies on its engineering staff to develop its technology; operations staff to manage and operate the campaigns, its sales teams to attract and retain key customers and its finance department staff to properly manage and maintain the financial records and reporting thereof. The inability to hire, or the increased costs of new personnel, or the cost to maintain existing personnel could have a material adverse effect on the Company’s business and operating results. There is intense competition for capable personnel in all of these areas, and the Company may not be successful in attracting, training, integrating, motivating, or retaining new personnel, vendors, or subcontractors for these required functions. The growth of the Company is dependent on hiring additional personnel so there is additional costs in training these new personnel. | |
| ● | Children advertising - The Company is dependent on advertising to children so therefore is affected by changes to this business segment. The Company is expanding into advertising to teens and families and to be less reliant on advertising to children. | |
| ● | Market conditions - The economic uncertainty in the market has made and continues to make it difficult for the Company to forecast revenue and operating results and to make decisions regarding operational cost structures and investments. The Company’s business depends on the overall demand for advertising and on the economic health of its customers. Economic downturns or unstable market conditions may cause the Company’s customers to decrease their advertising budgets, which could reduce usage of the Company’s platform and adversely affect its business, operating results, and financial condition. |
| Page 19 |
KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
| ● | Inappropriate advertisement - This is the risk that the Company serves an inappropriate advertisement on behalf of its customers. To mitigate this risk all adverts are human reviewed before the campaign commences. | |
| ● | Cybersecurity - Cybersecurity attacks, including breaches, computer malware and computer hacking have become more prevalent recent years across all businesses. Any cybersecurity breach caused by hacking, which involves efforts to gain unauthorized access to information or systems, or to cause intentional malfunctions or loss or corruption of data, software, hardware or other computer equipment, or the inadvertent transmission of computer viruses could adversely affect the business, financial condition, results of operations or reputation of the Company. The Company believes that it is taken reasonable steps to protect the security, integrity and confidentiality of the information collected, used, stored and disclosed, but there is no guarantee that in the future inadvertent (e.g., software bugs or other technical malfunctions, employee error or malfeasance, or other factors) or unauthorized data access or use will not occur despite its efforts in the past and in the future. | |
| ● | Technology - The Company’s future success is dependent on its ability to continue to develop and expand its products and technologies and to address the needs of its customers. The Company operates in an industry that is characterized by rapid technological change, frequent new product and service introductions and enhancements, uncertain product life cycles, changes in customer requirements, and evolving industry standards. The introduction of new products and new technologies, the emergence of new industry standards, or improvements to existing technologies could render the Company’s platform obsolete or relatively less competitive. | |
| ● | Outages - In addition, the Company operates 24/7 business so if outages were to occur it is critical for the technology to be restored in a timely manner. Any delay in restoring the systems will have a negative effect on its business, operating results and financial condition. | |
| ● | Cloud based servers - The Company’s products and services involve storage using a third-party cloud-based hosting service. Any damage to, or failure of, the hosting service’s systems generally could result in interruptions in the use of the Company’s platform. Such interruptions may reduce the Company’s revenue, and adversely the Company’s ability to attract new customers. The Company’s business will also be harmed if its customers and potential customers believe its products or services are unreliable. | |
| ● | Incorrect advertising – The Company is developing a teens and family platform under its Prado brand. Therefore, there is the risk that an inappropriate advertisement is served to children, which could result in fines to the Company and have a negative effect on its business, operating results, and financial condition. The Company has put in internal controls that ensure no non children advertisement is served to children. |
| Page 20 |
KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
Financial and Accounting Risks
| ● | Additional financing - There can be no certainty that the Company’s financial resources and revenue from sales will be sufficient for its future needs. The Company may need to incur significant expenses for growth, operations, research and development, as well as sales and marketing and other unforeseen costs. The ability of the Company to arrange such financing in the future will depend in part upon the prevailing capital market conditions as well as the business performance of the Company. It may be difficult or impossible for the Company to obtain debt financing or equity financing on commercially acceptable terms. In addition, the issuance of common shares for an equity financing may have a negative effect on the existing shareholders of the Company such as dilution or negative sentiments in the market to the equity financing. | |
| ● | Growth – Kidoz anticipates continued growth that could require substantial financial and other resources to, among other things: (a) expand and develop product offerings; (b) improve technological infrastructure, including investing in its technology (c) cover general and administrative expenses, including legal, accounting and other expenses; (d) cover sales and marketing expenses, including a significant expansion of the Company’s direct sales organization. Investment in these, however, may not yield anticipated returns. Consequently, as costs increase, the Company may not be able to generate sufficient revenue to achieve or sustain profitability. | |
| ● | Payment risks – If our customers do not pay, or dispute their invoices, then the business, operating results and financial condition may be adversely affected. In addition, if our customers do not pay in a timely manner will our operating results and financial condition may be adversely affected. | |
| ● | Internal Controls - A failure to maintain an effective system of internal control over financial reporting could harm the Company’s financial performance, its ability to raise capital and its continued listing on the TSX Venture Exchange. In addition, the Company is a small company so has limited segregation of duties. The Company is therefore reliant on the critical personnel and an increase in the risk of the failure of internal controls. | |
| ● | Changes to GAAP – The Company’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). There is a risk that changes to US GAAP will negatively affect the Company in terms of results and could become more difficult, time-consuming or costly and increase demand on the Company’s systems and resources to comply with this change. |
Industry Risk
| ● | Competition – the advertising business is a highly competitive business. The Company offers niche advertising in a highly regulated business. However, there are few barriers to existing large advertising companies entering the market. Our existing customers could develop their own in-house solutions and therefore no longer advertise with us. | |
| ● | Ad blockers – Consumers may load ad blocking software. This will affect our ability to serve advertisements and will therefore reduce our revenue. | |
| ● | Failure to access advertising inventory – We must maintain a consistent supply of ad inventory. Our success depends on our ability to secure inventory on reasonable terms in multiple locations. The amount, quality, and cost of inventory available to the Company can change at any time. If our relationships with any of our significant suppliers were to cease, or if the material terms of these relationships were to change unfavourably, our business would be negatively impacted. | |
| ● | Fraud – The Company operates as a technology and services provider in a dynamic ecosystem where fraud exists. Typical forms of fraud include robotic traffic, where robots mimic the behaviour of users in order to inflate the number of impressions, clicks, post clicks actions or other metrics associated with the ad. The Company reviews all ads and monitors the impression serving with our suppliers. | |
| ● | Catastrophic events – We maintain cloud-based servers around the world, that deliver advertising campaigns for our advertisers. Any of its existing and future facilities may be harmed or rendered inoperable by attack or security intrusion by a computer hacker, natural or man-made disasters, including earthquakes, tornadoes, hurricanes, wildfires, floods, nuclear disasters, war, acts of terrorism or other criminal activities, infectious disease outbreaks and power outages, any of which may render it difficult or impossible for the Company to operate its business for some period of time. The Company maintains backup and disaster recovery plans to get back up and running as fast as possible. |
| Page 21 |
KIDOZ INC. and subsidiaries
Management’s Discussion and Analysis
Six Months ended June 30, 2026 and 2025
| ● | Economic, Political and Market Conditions – Our business depends on the overall demand for advertising and on the economic health of our current and prospective advertisers. Economic downturns, including a recession, or instability in political or market conditions may cause current or new advertisers to reduce their advertising budgets. These conditions are impacted by events outside of the Company’s control, such as the Iran war affecting world oil prices and the COVID-19 pandemic, may have a long-term impact on the global economy. Adverse economic conditions and general uncertainty about continued economic recovery are likely to affect the Company’s business prospects. This uncertainty may cause general business conditions to deteriorate or become volatile, which could cause advertisers to delay, decrease or cancel campaigns, and expose the Company to increased credit risk on advertiser orders, which, in turn, could negatively impact its business, financial condition and results of operations. In addition, continued geopolitical turmoil in many parts of the world, especially in the Middle East have and may continue to put pressure on global economic conditions, which could lead to reduced spending on advertising. The Company maintains an office with several staff in Israel which could become inoperative due to the current war in Israel. The Company maintains backup and disaster recovery plans to get back up and running as fast as possible should problems occur. |
Risks Related to the Common Shares and Corporate and Securities Law
| ● | Market for common shares – The shares of the Company are illiquid. The Company has made efforts to improve the exposure of the Company through its stock awareness program and create a more active market for its shares. There are no assurances that our Stock Awareness campaigns will be effective to create a liquid market. | |
| ● | Volatility in the market - Technology stocks have historically experienced high levels of volatility and we cannot predict the prices at which our common shares will trade. Fluctuations in the market price of our common shares could cause an investor to lose all or part of their investment in our common shares. These fluctuations in the market price and volatility of our common shares can be caused by factors outside the control of the Company such the following: |
| ○ | The volatility in the market price and trading volume of technology companies in general especially large companies in the digital advertising industry (e.g. Google and Meta); | |
| ○ | Changes in regulatory developments in Canada and the United States; | |
| ○ | General economic conditions and trends, including global financial markets, global economies and general market conditions, such as interest rates; | |
| ○ | Major catastrophic events (e.g. the war in the Middle East and Ukraine); | |
| ○ | Unexpected market reactions to the Company announcements; | |
| ○ | Trade wars and trade tariffs. |
As a result, share prices of many technology companies have fluctuated in a manner unrelated or disproportionate to the operating performance of those companies. In general, in the past, shareholders have filed securities class action litigation following periods of market volatility. If Kidoz were to become involved in securities litigation, it could subject it to substantial costs, divert resources and the attention of management from our business, and adversely affect our business.
| ● | Public Company implications – The Company is listed on the Toronto Venture Stock Exchange and is therefore subject to its listing requirements. Compliance with these rules and regulations could become more difficult, time-consuming, or costly and increase demand on the Company’s systems and resources. |
ADDITIONAL INFORMATION
Additional information and other publicly filed documents relating to Kidoz Inc. are available through the internet on the Canadian Securities Administrators’ System for Electronic Document Analysis and Retrieval (“SEDAR+”), which can be accessed at www.sedarplus.com and the Company’s website at http://investor.kidoz.net.
In addition, we file with the Securities and Exchange Commission at the Securities and Exchange Commission’s Public Reference Room at 100 F Street, N.E., Washington D.C. 20549. You can request copies of these documents, upon payment of a duplicating fee, by writing to the Securities and Exchange Commission. Please call the Securities and Exchange Commission at 1-800-SEC-0330 for further information on the operation of the Public Reference Room.
We file our reports with the Securities and Exchange Commission electronically through the Securities and Exchange Commission’s Electronic Data Gathering, Analysis and Retrieval (“EDGAR”) system. The Securities and Exchange Commission maintains an Internet site that contains reports, proxy and information statements, and other information regarding companies that file electronically with the Securities and Exchange Commission through EDGAR. The address of this Internet site is http://www.sec.gov.
| Page 22 |
EXHIBIT 99.3
Form 52-109F2
Certification of Interim Filings
Full Certificate
I, Jason Williams, Chief Executive Officer of Kidoz Inc. certify the following:
| 1. | Review: I have reviewed the interim financial report and interim MD&A (together, the “interim filings”) of Kidoz Inc. (the “issuer”) for the interim period ended June 30, 2026. |
| 2. | No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings. |
| 3. | Fair presentation: Based on my knowledge, having exercised reasonable diligence, the interim financial report together with the other financial information included in the interim filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the interim filings. |
| 4. | Responsibility: The issuer’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings, for the issuer. |
| 5. | Design: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer’s other certifying officer(s) and I have, as at the end of the period covered by the interim filings |
| (a) | designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that |
| (i) | material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and | |
| (ii) | information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and |
| (b) | designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer’s GAAP. |
| 5.1 | Control framework: The control framework the issuer’s other certifying officer(s) and I used to design the issuer’s ICFR is the Internal Control - Integrated Framework (2013) (COSO Framework) published by The Committee of Sponsoring Organizations of the Treadway Commission (COSO). |
| 5.2 | ICFR – material weakness relating to design: N/A |
| 5.3 | Limitation on scope of design: N/A |
| 6. | Reporting changes in ICFR: The issuer has disclosed in its interim MD&A any change in the issuer’s ICFR that occurred during the period beginning on April 1, 2026 and ended on June 30, 2026 that has materially affected, or is reasonably likely to materially affect, the issuer’s ICFR. |
Date: August 26, 2026
| /S/ J.M. Williams | |
| J. M. Williams | |
| Chief Executive Officer |
EXHIBIT 99.4
Form 52-109F2
Certification of Interim Filings
Full Certificate
I, Henry Bromley, Chief Financial Officer of Kidoz Inc. certify the following:
| 1. | Review: I have reviewed the interim financial report and interim MD&A (together, the “interim filings”) of Kidoz Inc. (the “issuer”) for the interim period ended June 30, 2026. | |
| 2. | No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings. | |
| 3. | Fair presentation: Based on my knowledge, having exercised reasonable diligence, the interim financial report together with the other financial information included in the interim filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the interim filings. | |
| 4. | Responsibility: The issuer’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings, for the issuer. | |
| 5. | Design: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer’s other certifying officer(s) and I have, as at the end of the period covered by the interim filings |
| (a) | designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that |
| (i) | material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and | |
| (ii) | information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and |
| (b) | designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer’s GAAP. |
| 5.1 | Control framework: The control framework the issuer’s other certifying officer(s) and I used to design the issuer’s ICFR is the Internal Control - Integrated Framework (2013) (COSO Framework) published by The Committee of Sponsoring Organizations of the Treadway Commission (COSO). |
| 5.2 | ICFR – material weakness relating to design: N/A |
| 5.3 | Limitation on scope of design: N/A |
| 6. | Reporting changes in ICFR: The issuer has disclosed in its interim MD&A any change in the issuer’s ICFR that occurred during the period beginning on April 1, 2026 and ended on June 30, 2026 that has materially affected, or is reasonably likely to materially affect, the issuer’s ICFR. |
Date: August 26, 2026
| /S/ H. W. Bromley | |
| H. W. Bromley | |
| Chief Financial Officer |