VERI · Veritone, Inc.

Veritone's Q1 2026 results reflect a mixed performance as the company navigates a transition toward higher-growth AI infrastructure offerings. Total revenue declined 9.8% year-over-year to $20.3 million, driven by a 4.6% drop in Software Products & Services (to $13.8 million) and a 19.2% decline in Managed Services (to $6.4 million). The Managed Services decline was attributed to lower influencer-based advertising revenue and reduced content licensing amid a challenging macro environment. However, the company's strategic pivot to Veritone Data Refinery (VDR) showed strong momentum: VDR qualified bookings and near-term pipeline exceeded $68 million, representing over 150% growth from mid-2025 estimates and 500% year-over-year. Annual Recurring Revenue (ARR) grew 9.4% to $64.2 million, with consumption-based ARR surging 49.7% to $16.8 million, underscoring the shift toward usage-based AI workloads. Gross margins improved: GAAP gross margin rose 30 bps to 61.4%, and non-GAAP gross margin expanded 254 bps to 67.7%, driven by a higher mix of consumption-based and one-time software revenue. Operating loss improved 10.2% to $19.4 million, aided by lower general and administrative expenses. Net loss narrowed slightly to $19.5 million from $19.9 million, while non-GAAP net loss widened to $11.9 million due to reduced capitalized software. Management highlighted several strategic wins: multi-year agreements with Oracle (OCI as cornerstone), Google, and NVIDIA for VDR; launch of Veritone Data Marketplace; and expanded public sector deployments with the Defense Logistics Agency and Air Force. The company announced a targeted 30% operating expense reduction initiative, aiming for operating profitability as early as Q4 2026. Full-year 2026 guidance was reaffirmed: revenue of $130-$145 million (48% implied growth at midpoint) and non-GAAP net loss of $13.5-$22.5 million (56% improvement). The guidance implies a significant acceleration in the second half of the year, contingent on VDR scaling and cost discipline.