VIQ Solutions reports another quarter of positive adjusted EBITDA including positive cash flow and improved gross margins.
The Company initiated a significant cost reduction program in advance of winding down its Australian operations. Most of these cost savings are expected to be realized by the end of the third quarter of 2026 which will contribute to future EBITDA and cash flow.
VIQ Solutions' Australian operations were wound down as onerous business conditions did not allow the company to successfully implement its global scalable architecture. Australian Administrators were unable to sell or recapitalize the business after an extensive outreach to potential buyers.
Management and capital resources are now focused on the Company's North American & UK operations which have historically been its highest performing business units.
Richmond Hill, Ontario--(Newsfile Corp. - August 13, 2026) - VIQ Solutions Inc. (TSXV: VQS) ("VIQ" or "the Company"), a global provider of secure, AI-driven, digital voice and video capture technology and transcription services, today announced financial results for the three and six months ended June 30, 2026.
As previously reported, VIQ's Australian division was placed into voluntary administration pursuant to Part 5.3A of the Corporations Act 2001 (Australia) in March 2026 (the "Voluntary Administration"). The sale or recapitalization process related to VIQ Australia was unsuccessful and the administrators are conducting an orderly wind down of the VIQ Australia business. Much of the operational wind down was completed in June 2026.
Financial results for the three and six months ended June 30, 2026 include VIQ Australia.
Financial highlights including VIQ Australia are as follows:
Three months ended June 30, 2026
- Revenue: $11.5 million, an increase of 10.2% from the same period in the prior year. The Administrators in Australia pushed to complete as much backlog as possible prior to commencing the wind down of operations.
Gross Margin: 57.8%, up from 48% for the same period in the prior year.
Adjusted EBITDA: $2.9 million, 25.2% of revenue; same period in the prior year was $0.96 million.
Six months ended June 30, 2026
Revenue: $21.3 million, an increase of 6.3% from the same period in the prior year.
Gross Margin: 54.6%, up from 49.9% for the same period in the prior year.
- Adjusted EBITDA: $4.2 million, an increase of $2.3 million from the same period in the prior year.
Financial highlights excluding VIQ Australia are as follows:
Three months ended June 30, 2026
- Revenue: $5.1 million, consistent with revenue for the same period last year.
Gross Margin: 65.5%, up from 64.1% for the same period in the prior year, driven primarily by higher license revenue.
Adjusted EBITDA: $1.0 million, an increase of 89% compared to $0.6 million from the same period in the prior year due primarily to lower operating expenses.
Six months ended June 30, 2026
Revenue: $10.0 million, consistent with revenue for the same period in the prior year.
Gross Margin: 65.3%, up from 64.6% for the same period in the prior year.
Adjusted EBITDA: $1.7 million, an increase of 64% compared to $1.1 million from the same period in the prior year.
Strategic and Operational Highlights
VIQ's management is focused on the Company's operations in North America and the United Kingdom and continuing to implement the cost reduction plan which commenced in the first quarter of 2026.
We are pleased with the speed and quantum of the cost reduction plan which is and is expected to continue to improving the Company's financial performance, including gross margins, EBITDA, and cash flow for the balance of 2026 and into 2027, said Larry Taylor, CEO, VIQ Solutions.
Management is also focused on improving revenue, both organically and through strategic acquisitions.
A copy of the Company's unaudited financial statements and accompanying MD&A for the three and six months ended June 30, 2026 (collectively, the "Financial Information") will be available under the Company's profile on SEDAR+ at www.sedarplus.ca.
Media Contact:
Larry Taylor, CEO, VIQ Solutions
(800) 263-9947
Jacob Manning, VIQ Solutions
Email: marketing@viqsolutions.com
For more information about VIQ, please visit viqsolutions.com.
About VIQ Solutions
VIQ Solutions is a global provider of secure, AI-driven, digital voice and video capture technology and transcription services. VIQ offers a seamless, comprehensive solution suite that delivers intelligent automation, enhanced with human review, to drive transformation in the way content is captured, secured, and repurposed into actionable information. The cyber-secure, AI technology and services platform are implemented in the most rigid security environments including criminal justice, legal, insurance, government, corporate finance, media, and transcription service provider markets, enabling them to improve the quality and accessibility of evidence, to easily identify predictive insights and to achieve digital transformation faster and at a lower cost.
Forward-looking Statements
Certain statements included in this press release constitute forward-looking statements or forward-looking information (collectively, "forward-looking statements") under applicable securities legislation. Such forward-looking statements or information are provided for the purpose of providing information about management's current expectations and plans relating to the future. Readers are cautioned that reliance on such information may not be appropriate for other purposes.
Forward-looking statements typically contain statements with words such as "anticipate", "believe", "expect", "plan", "intend", "estimate", "propose", "project" or similar words, including negatives thereof, suggesting future outcomes or that certain events or conditions "may" or "will" occur. These statements are only predictions. Forward-looking statements in this press release include but are not limited to statements with respect to the Company's ability to accelerate automation, optimize costs, and improve scalability in the future, expected margin improvement, the Company's focus and its priorities, the filing of the Financial Information on SEDAR+ and expected future Adjusted EBITDA improvement.
Forward-looking statements are based on several factors and assumptions which have been used to develop such statements, but which may prove to be incorrect. Although VIQ believes that the expectations reflected in such forward-looking statements are reasonable, undue reliance should not be placed on forward-looking statements because VIQ can give no assurance that such expectations will prove to be correct. In addition to other factors and assumptions which may be identified in this press release, assumptions have been made regarding, among other things, recent initiatives, cost savings from workforce and product optimization, cost reductions from the Company's workflow solutions and that sales and prospects may increase revenue. Readers are cautioned that the foregoing list is not exhaustive of all factors and assumptions that have been used.
Forward-looking statements are necessarily based on a number of opinions, assumptions and estimates that while considered reasonable by the Company as of the date of this press release, are subject to known and unknown risks, uncertainties, assumptions, and other factors that may cause the actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking statements, including but not limited to the factors described in greater detail in the "Risk Factors" section of the Company's annual information form and in the Company's other materials filed with the Canadian securities regulatory authorities.
These factors are not intended to represent a complete list of the factors that could affect the Company; however, these factors should be considered carefully. Such estimates and assumptions may prove to be incorrect or overstated. The forward-looking statements contained in this press release are made as of the date of this press release and the Company expressly disclaims any obligations to update or alter such statements, or the factors or assumptions underlying them, whether as a result of new information, future events or otherwise, except as required by law.
VIQ Solutions Inc.
Interim Condensed Statements of Financial Position
(Expressed in USD dollars, unaudited)
| June 30, 2026 | December 31, 2025 | |||||
| Assets | ||||||
| Current assets | ||||||
| Cash | $ | 5,470,529 | $ | 2,445,011 | ||
| Trade and other receivables, net of allowance for doubtful accounts | 3,935,651 | 4,284,491 | ||||
| Income tax receivable | 74,221 | - | ||||
| Inventories | 18,103 | 31,088 | ||||
| Prepaid expenses and deposits | 586,081 | 797,778 | ||||
| 10,084,585 | 7,558,368 | |||||
| Non-current assets | ||||||
| Restricted cash | 279,456 | 271,134 | ||||
| Right-of-use assets | 30,677 | 46,718 | ||||
| Intangible assets | 1,610,012 | 1,730,999 | ||||
| Goodwill | 7,073,495 | 7,089,897 | ||||
| Total assets | $ | 19,078,225 | $ | 16,697,116 | ||
| Liabilities | ||||||
| Current liabilities | ||||||
| Trade and other payables and accrued liabilities | $ | 6,847,473 | $ | 5,987,570 | ||
| Income tax payable | 59,213 | 51,832 | ||||
| Derivative warrant liability | - | 1,297 | ||||
| Current portion of long-term debt | 19,845,853 | 18,806,332 | ||||
| Current portion of lease obligations | 483,039 | 417,619 | ||||
| Current portion of contract liabilities | 1,095,254 | 1,211,312 | ||||
| 28,330,832 | 26,475,962 | |||||
| Non-current liabilities | ||||||
| Long-term lease obligations | 534,187 | 757,597 | ||||
| Other long-term liabilities | 743,577 | 810,381 | ||||
| Total liabilities | 29,608,596 | 28,043,940 | ||||
| Shareholders' equity (deficiency) | ||||||
| Capital stock | 79,096,144 | 78,979,646 | ||||
| Contributed surplus | 10,315,413 | 10,333,374 | ||||
| Accumulated other comprehensive loss | (2,494,794 | ) | (1,771,595 | ) | ||
| Deficit | (97,447,134 | ) | (98,888,249 | ) | ||
| Total shareholders' equity (deficiency) | (10,530,371 | ) | (11,346,824 | ) | ||
| Total liabilities and shareholders' equity (deficiency) | $ | 19,078,225 | $ | 16,697,116 |
VIQ Solutions Inc.
Interim Condensed Consolidated Statements of Income (Loss) and Comprehensive Income (Loss)
(Expressed in USD dollars)
(Unaudited)
| Three months ended June 30, | Six months ended June 30, | |||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||
| Revenue | $ | 11,520,014 | $ | 10,445,488 | $ | 21,290,762 | $ | 20,024,513 | ||||
| Cost of sales | 4,863,512 | 5,436,220 | 9,667,874 | 10,040,105 | ||||||||
| Gross profit | 6,656,502 | 5,009,268 | 11,622,888 | 9,984,408 | ||||||||
| Expenses | ||||||||||||
| Selling and administrative expenses | 3,580,918 | 3,866,110 | 7,111,436 | 7,676,752 | ||||||||
| Research and development expenses | 170,854 | 179,957 | 345,636 | 320,476 | ||||||||
| Stock-based compensation | 61,379 | 292,682 | 114,383 | 291,865 | ||||||||
| Gain on revaluation of RSUs | - | (21,482 | ) | (375 | ) | (19,553 | ) | |||||
| Loss (gain) on revaluation of the derivative warrant liability | - | 8,260 | (1,274 | ) | 1,238 | |||||||
| Foreign exchange gain | (83,212 | ) | (354,295 | ) | (612,197 | ) | (438,327 | ) | ||||
| Depreciation | 27,888 | 175,864 | 45,627 | 340,547 | ||||||||
| Amortization | 267,635 | 658,581 | 559,560 | 1,366,158 | ||||||||
| Interest expense | 486,661 | 439,704 | 980,354 | 928,326 | ||||||||
| Accretion and other financing costs | 560,221 | 456,029 | 1,104,022 | 875,059 | ||||||||
| Impairment of right of use assets | 30,256 | - | 30,256 | - | ||||||||
| Restructuring costs | 205,090 | 37,349 | 388,375 | 36,066 | ||||||||
| Strategic review costs | - | 119,124 | - | 1,294,726 | ||||||||
| Other income | (24,405 | ) | (1,911 | ) | (30,203 | ) | (8,118 | ) | ||||
| Total expenses | 5,283,285 | 5,855,972 | 10,035,600 | 12,665,215 | ||||||||
| Current income tax expense | 69,666 | 52,654 | 146,173 | 86,933 | ||||||||
| Income tax expense | 69,666 | 52,654 | 146,173 | 86,933 | ||||||||
| Net income (loss) for the period | $ | 1,303,551 | $ | (899,358 | ) | $ | 1,441,115 | $ | (2,767,740 | ) | ||
| Exchange (loss) gain on translation of foreign operations | (168,772 | ) | 16,115 | (723,199 | ) | 15,027 | ||||||
| Comprehensive income (loss) for the period | $ | 1,134,779 | $ | (883,243 | ) | $ | 717,916 | $ | (2,752,713 | ) | ||
| Net income (loss) per share | ||||||||||||
| Basic | 0.02 | (0.02 | ) | 0.02 | (0.05 | ) | ||||||
| Diluted | 0.02 | (0.02 | ) | 0.02 | (0.05 | ) | ||||||
| Weighted average common shares outstanding - basic | 70,425,946 | 52,563,142 | 70,127,677 | 52,449,214 | ||||||||
| Weighted average common shares outstanding - diluted | 74,543,890 | 52,563,142 | 74,245,621 | 52,449,214 | ||||||||
The following is a reconciliation of Net income (loss) to Adjusted EBITDA, the most directly comparable IFRS measure for the three and six months ended June 30, 2026, and 2025:
| Three months ended June 30 | Six months ended June 30 | |||||||||||
| (Unaudited) | 2026 | 2025 | 2026 | 2025 | ||||||||
| Net Income (loss) | 1,303,551 | (899,358 | ) | 1,441,115 | (2,767,740 | ) | ||||||
| Add: | ||||||||||||
| Depreciation | 27,888 | 175,864 | 45,627 | 340,547 | ||||||||
| Amortization | 267,635 | 658,581 | 559,560 | 1,366,158 | ||||||||
| Interest expense | 486,661 | 439,704 | 980,354 | 928,326 | ||||||||
| Current income tax (recovery) expense | 69,666 | 52,654 | 146,173 | 86,933 | ||||||||
| EBITDA | 2,155,401 | 427,445 | 3,172,829 | (45,776 | ) | |||||||
| Accretion and other financing costs | 560,221 | 456,029 | 1,104,022 | 875,059 | ||||||||
| Gain on revaluation of RSUs | - | (21,482 | ) | (375 | ) | (19,553 | ) | |||||
| Loss (gain) on revaluation of the derivative warrant liability | - | 8,260 | (1,274 | ) | 1,238 | |||||||
| Impairment of right of use assets | 30,256 | - | 30,256 | - | ||||||||
| Restructuring costs | 205,090 | 37,349 | 388,375 | 36,066 | ||||||||
| Strategic Review Costs | - | 119,124 | - | 1,294,726 | ||||||||
| Other income | (24,405 | ) | (1,911 | ) | (30,203 | ) | (159,978 | ) | ||||
| Stock-based compensation | 61,379 | 292,682 | 114,383 | 291,865 | ||||||||
| Foreign exchange gain | (83,212 | ) | (354,295 | ) | (612,197 | ) | (438,327 | ) | ||||
| Adjusted EBITDA | 2,904,730 | 963,201 | 4,165,816 | 1,835,320 | ||||||||
The following is a reconciliation of Net income (loss) to Adjusted operating income (loss), the most directly comparable IFRS measure for the three and six months ended June 30, 2026, and 2025:
| Three months ended June 30 | Six Months ended June 30 | |||||||||||
| (Unaudited) | 2026 | 2025 | 2026 | 2025 | ||||||||
| Net income (loss) | $ | 1,303,551 | (899,358 | ) | 1,441,115 | (2,767,740 | ) | |||||
| Add: | ||||||||||||
| Strategic review costs | - | 119,124 | - | 1,294,726 | ||||||||
| Adjusted operating income (loss) | $ | 1,303,551 | (780,234 | ) | $ | 1,441,115 | (1,473,014 | ) | ||||
Non-IFRS Measures
The Company prepares its financial statements in accordance with IFRS. Non-IFRS measures are provided by management to provide additional insight into our performance and financial condition. VIQ believes non-IFRS measures are an important part of the financial reporting process and are useful in communicating information that complements and supplements the consolidated financial statements.
Adjusted EBITDA and adjusted operating loss are not measures recognized by IFRS and do not have standardized meanings prescribed by IFRS. Therefore, Adjusted EBITDA and adjusted operating loss may not be comparable to similar measures presented by other issuers. Investors are cautioned that Adjusted EBITDA and adjusted operating loss should not be construed as alternatives to net income (loss) as determined in accordance with IFRS. For a reconciliation of net income (loss) to Adjusted EBITDA and adjusted operating income (loss) please see the Company's MD&A for three and six months ended June 30, 2026.
To evaluate the Company's operating performance as a complement to results provided in accordance with IFRS, the term "Adjusted EBITDA" refers to net income (loss) before adjusting earnings for stock-based compensation, depreciation, amortization, interest expense, accretion, and other financing expense, gain on revaluation of restricted share units, gain (loss) on revaluation of derivative warrant liability, restructuring costs, strategic review costs, impairment of right of use assets, other income, foreign exchange (gain) loss, current income tax expense. We believe that the items excluded from Adjusted EBITDA are not connected to and do not represent the operating performance of the Company.
We believe that Adjusted EBITDA is useful supplemental information as it provides an indication of the results generated by the Company's main business activities prior to taking into consideration how those activities are financed and taxed as well as expenses related to stock-based compensation, depreciation, amortization, impairment of right of use assets, other income, and foreign exchange (gain) loss. Accordingly, we believe that this measure may also be useful to investors in enhancing their understanding of the Company's operating performance.
The term "adjusted operating income (loss)" refers to net income (loss) excluding the impact of strategic review costs. Management believes it is appropriate to adjust for this item because strategic review costs do not relate to operating activities of the Company and is useful supplemental information as it provides an indication of the results generated by the Company's main business activities. The presentation of this measure enables investors and analysts to better understand the underlying performance of our business activities.
Trademarks
This press release includes trademarks, such as "NetScribe", which are protected under applicable intellectual property laws and are the property of VIQ. Solely for convenience, our trademarks referred to in this press release may appear without the ® or TM symbol, but such references are not intended to indicate, in any way, that we will not assert our rights to these trademarks, trade names, and services marks to the fullest extent under applicable law. Trademarks that may be used in this press release, other than those that belong to VIQ, are the property of their respective owners.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/309584
