UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

☒ Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

for the Fiscal Year Ended July 31, ~~2024~~2025

☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Commission File Number: 1-37782

Zedge, Inc.

(Exact Name of Registrant as Specified in its Charter)

Delaware		26-3199071
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

1178 Broadway, 3rd Floor #1450, New York, NY		10001
(Address of Principal Executive Offices)		(Zip Code)

(330) 577-3424

(Registrant’s Telephone Number, Including Area Code)

Title of each class		Trading Symbol		Name of each exchange on which registered
Class B common stock, par value $0.01 per share		ZDGE		NYSE American

Securities registered pursuant to Section 12(g) of the Act:

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes ☐ No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐		Accelerated filer ☐
Non-accelerated filer ☒		Smaller reporting company ☒
Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The aggregate market value of the voting and non-voting stock held by non-affiliates of the registrant, based on the adjusted closing price on January 31, ~~2024~~2025 (the last business day of the registrant’s most recently completed second fiscal quarter) of the Class B common stock of $32.2671 per share, as reported on the New York Stock Exchange, was approximately $3837.39 million.

As of October 2824, ~~2024~~2025, the registrant had outstanding 524,775 shares of Class A common stock and 1312,~~618~~479,~~761~~136 shares of Class B common stock.

DOCUMENTS INCORPORATED BY REFERENCE

The definitive proxy statement relating to the registrant’s Annual Meeting of Stockholders, to be held January 1514, ~~2025~~2026, is incorporated by reference into Part III of this Form 10-K to the extent described therein.

Index

Zedge, Inc.

TABLE OF CONTENTS

PART I		1	1
Item 1.	Business	1	1
Item 1A.	Risk Factors	8	9
Item 1B.	Unresolved Staff Comments	42	45
Item 2.	Properties	44
Item 1C.	Cybersecurity		45
Item 3.	Legal Proceedings	44
Item 2.	Properties		48
Item 4.	Mine Safety Disclosures	44
Item 3.	Legal Proceedings		48
PART II		45
Item 4.	Mine Safety Disclosures		48
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	45
PART II			49
Item 6.	[Reserved]	46
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities		49
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	46
Item 6.	[Reserved]		50
Item 7A.	Quantitative and Qualitative Disclosures about Market Risks	64
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		50
Item 8.	Financial Statements and Supplementary Data	64
Item 7A.	Quantitative and Qualitative Disclosures about Market Risks		69
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	64
Item 8.	Financial Statements and Supplementary Data		69
Item 9A.	Controls and Procedures	64
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure		69
Item 9B.	Other Information	64
Item 9A.	Controls and Procedures		69
Item 9C.	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections	64
Item 9B.	Other Information		69
PART III		65
Item 9C.	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections		69
Item 10.	Directors and Executive Officers of the Registrant, and Corporate Governance	65
PART III			70
Item 11.	Executive Compensation	65
Item 10.	Directors and Executive Officers of the Registrant, and Corporate Governance		70
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	65
Item 11.	Executive Compensation		70
Item 13.	Certain Relationships and Related Transactions, and Director Independence	65
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters		70
Item 14.	Principal Accounting Fees and Services	65
Item 13.	Certain Relationships and Related Transactions, and Director Independence		70
PART IV		66
Item 14.	Principal Accounting Fees and Services		70
Item 15.	Exhibits, Financial Statement Schedules	66
PART IV			71
Item 16.	Form 10-K Summary	67
Item 15.	Exhibits, Financial Statement Schedules		71
SIGNATURES		68
Item 16.	Form 10-K Summary		72
SIGNATURES			73

PART I

As used in this Annual Report, unless the context otherwise requires, the terms the “Company,” “Zedge,” “we,” “us,” and “our” refer to Zedge, Inc., a Delaware corporation, and its subsidiaries, collectively. Our fiscal year runs from August 1 through July 31. Each reference to a fiscal year in this Annual Report refers to the fiscal year ending in the calendar year indicated (for example, fiscal ~~2024~~ 2025 refers to the fiscal year ended July 31, ~~2024~~2025).

Item 1. Business

Company Overview

Zedge builds digital marketplaces and friendly competitive games around content that people use to express themselves. Our leading products include Zedge Ringtones and Wallpapers, which we refer to as our “Zedge App,” a freemium digital content marketplace offering mobile phone wallpapers, video wallpapers, ringtones, and notification sounds as well as pAInt, a generative AI wallpaper and ringtone maker, GuruShots, a skill-based photo challenge game, and Emojipedia, the #1 trusted source for ‘all things emoji’. Our vision is to enable and connect creators who enjoy friendly competitions with a community of prospective consumers in order to drive commerce.

We are part of the ‘Creator Economy,’ which ~~Goldman~~is ~~Sachs~~estimated ~~estimates~~to isbe worth between $191 billion and $250 billion globally.1 ~~According~~in ~~to Linktree~~2025, with ~~over~~some ~~200~~forecasts ~~million~~placing ~~individuals~~the ~~identify~~ global market size as ~~creators,~~high ~~people~~as ~~who~~$848 ~~use~~billion ~~their~~by ~~influence,~~2032123. ~~skill~~According to multiple reports, there ~~and~~are ~~creativity~~now toover ~~amass~~207 anmillion ~~audience~~active ~~and~~content ~~monetize~~creators itworldwide.245 Furthermore, ~~Influencer Marketing~~between ~~Hub~~45% ~~reports~~and ~~that~~47% ~~out~~ of ~~2,000 surveyed~~ creators, ~~44.9%~~ identify as working full-time in this space678. Most creators earn modest incomes,3 and ~~Exploding~~studies ~~Topics~~suggest ~~reports~~ that 10only a small portion, approximately 4%, of ~~influencers~~creators earn more than $100,000 per ~~year~~year91011.4 We view the Creator Economy as an opportunity for Zedge to expand our business, especially as we execute by connecting our gamers with our marketplace.

Our Zedge App (which is named “Zedge Wallpapers” in the App Store) offers a wide array of mobile personalization content including wallpapers, video wallpapers, ringtones, and notification sounds, and is available both in Google Play and the App Store. AsOver ofthe ~~July~~past two ~~31,~~fiscal ~~2024~~years, our Zedge App ~~had been installed nearly 674 million times since inception and, over the past two fiscal years,~~ has had between 2622.1 million and 3228.27 million monthly active users (“MAU”), ending with 2623.1 3 million MAU as of July 31, ~~2024~~2025. MAU is a key performance indicator (“KPI”) for our Zedge App that captures the number of unique users that used our Zedge App during the final 30 days of the relevant period. Our platform allows creators to upload ~~content~~ content to our marketplace and avail it to our users either for free or, via ‘Zedge Premium,’ the section of our marketplace ~~where~~ where we offer premium content for purchase. In turn, our users utilize the content to personalize their phones and express their individuality.

In fiscal 2023, we introduced pAInt, a generative AI wallpaper maker in the Zedge App. A generative AI wallpaper maker is an implementation of artificial intelligence software that can create images from text descriptions. To interface with a generative AI image maker, a user enters a text description of the image they want to create, and the software generates an image based on that description. Today, pAInt is available for text-to-image, image-to-image, and text-to-audio creation. In addition, we upgraded Zedge+, our paid subscription ~~offering~~ offering by bundling together an ad-free experience with value adds making the offering more compelling.

We often refer to our freemium ringtones and wallpapers, our subscription offering, the functionality for creators to market their products and ancillary ~~offering~~offerings and features both in our Zedge App and website, as our Zedge Marketplace.

~~The~~1 ~~Zedge Marketplace’s monetization stack consists of advertising revenue generated when users view advertisements when using the Zedge App (and the related functionality under the zedge~~https://www.~~net website), the in~~coherentmarketinsights.com/industry-~~app sale of Zedge Credits, our virtual currency, that is used to purchase Zedge Premium content, and a paid~~reports/global-~~subscription offering that provides an ad~~creator-free experience to users that purchase a monthly or annual subscription. In April 2023, we introduced a subscription tier in the iOS version of the app. As of July 31, 2024, we had approximately 669,0000 active subscribers. economy-market

12 https://~~www~~market.~~latimes.com~~us/~~business~~report/~~story/2024-01-08/~~creator-~~influencer-~~economy-~~2024-predictions-social-media-stars~~market/

23 https://~~linktr~~inbeat.eeagency/blog/creator-~~report~~economy-statistics

34 https://~~influencermarketinghub~~demandsage.com/creator-~~earnings~~economy-~~benchmark-report~~statistics/

45 https://~~explodingtopics~~www.forbes.com/~~blog~~sites/~~creator~~stevenbertoni/2025/06/16/forbes-~~economy~~top-~~stats#~~creators-2025/

16 https://www.wpbeginner.com/research/creator-economy-statistics-that-will-blow-you-away/

In7 ~~April 2022, we acquired GuruShots Ltd (“GuruShots”) a recognized category leader focused on gamifying the photography vertical~~https://nealschaffer. GuruShots offers a platform spanning iOS, Android, and the web that provides a fun, educational and structured way for amateur photographers to compete in a wide variety of contests showcasing their photos while gaining recognition with votes, badges, and awards. We estimate that the total addressable market of amateur photographers using their smartphones to take and publicly share artistic photos is 30com/creator-40 million people per month and that the market is still in its infancy. Every month, GuruShots stages more than 300 competitions that result in players uploading in excess of 670,000 photographs and casting close to 3.2 billion “perceived votes,” which are calculated by multiplying the number of votes that each player casts by a weighting factor based on various factors related to that user. To improve engagement, GuruShots has adopted a set of retention dynamics focused on individual, team and community dynamics that create a sense of belonging, inspiration, recognition, improvement, and competition.economy-statistics/

~~GuruShots~~8 ~~utilizes a ‘Free~~https://www.spiralytics.com/blog/content-tocreator-~~Play’ business model and generates revenue through in~~statistics-app purchases of virtual currency. Players can use this currency to unlock competitions or gain an edge by purchasing resources and participating in additional gameplay. Over the past seven years, the monthly average paying player spend has increased in excess of 9.9% annually to more than $50.9 per player.2025/

In9 ~~fiscal 2024, we revamped GuruShots’ customer onboarding experience by guiding new players through simplified photo competitions of limited size and duration~~https://blog. ~~The upgrade was designed to enhance the gaming experience for new players by increasing their potential for winning and providing immediate gratification~~invitemember. ~~The new onboarding has shown improvements in engagement, retention, and revenue from new users. In addition, we migrated to a coin~~com/how-~~based economy with multiple currencies in order to enable more players to earn and spend their currency on in~~much-~~game resources.~~do-content-creators-make/

We10 ~~market GuruShots to prospective players, primarily via paid user acquisition channels, and utilize a host of creative formats including static and video ads in order to promote the game~~https://brentonway. ~~Our~~ com/top-influencer-marketing team invests material resources in analyzing all attributes of a campaign ranging from, among others, the creative assets, offer acquisition channel and platform (i.e., iOS, Android, and web), with the goal of determining whether a specific campaign is likely to yield a profitable customer. When we unearth a successful combination of these variables we scale up until we experience diminishing returns. Ultimately, we believe that the efforts we are making to advance the product coupled with the investment in user acquisition can significantly increase GuruShots’ player base.-statistics/

~~Since~~11 ~~the start of fiscal 2025, Cost per Install (CPI) have trended down considerably leading us to believe that our efforts are yielding fruit~~https://blog. It’s too early to say with conviction whether this trend is sustainable as we scale user acquisition and whether these users will provide sufficient long-term ROI; however, we believe that these early results are encouraginghootsuite.com/instagram-statistics/

Beyond our commitment to growing both the Zedge App and GuruShots on a standalone basis, we believe that there are many potential synergies that we can capitalize on that exist between the two businesses. Specifically, we plan to enable GuruShots players to become Zedge Premium artists and sell their photos to our audience of 25+ million MAU (as of July 31, 2024) as standard digital images. In addition, we are benefitting from the experience that the GuruShots team possesses in gamifying the Zedge App. We believe that successful gamification can contribute to increasing engagement, retention, and lifetime value, all critical KPIs for our business. Longer term, we believe that there are complementary content verticals that lend themselves to gamification. One example is our hybrid casual title, ‘AI Art Master,’ which has been in soft-launch in the Philippines, Poland, and India, that enables players to create generative AI images and compete in themed-based competitions with these images. Based on analyzing user data and performing extensive user testing, we will determine whether to refine the user experience and scale or cease development of this title.1

2The Zedge Marketplace’s monetization stack consists of advertising revenue generated when users view advertisements when using the Zedge App (and the related functionality under the zedge.net website), the in-app sale of Zedge Credits, our virtual currency, that is used to purchase Zedge Premium content, and a paid-subscription offering that provides an ad-free experience to users that purchase a monthly or annual subscription. In April 2023, we introduced a subscription tier in the iOS version of the app. As of July 31, 2025, we had approximately 984,000 active subscribers.

In fiscal ~~August 2021~~2025, we ~~acquired~~began ~~Emojipedia~~building ~~Pty~~DataSeeds.AI ~~Ltd~~ (“~~Emojipedia~~DataSeeds”), ~~the~~a ~~world’s~~business-to-business ~~leading~~marketplace ~~authority~~offering ~~dedicated~~access to ~~providing~~our uprapidly growing catalog of over 30 million high-~~to-date~~quality, ~~and~~fully ~~well~~rights-~~researched~~cleared ~~emoji~~images ~~definitions~~for AI training, ~~information~~ ecommerce, and ~~news,~~stock asphotos. ~~well~~Uniquely aspositioned to ~~World~~deliver ~~Emoji~~custom ~~Day~~content ~~and~~at ~~the~~scale, ~~annual~~DataSeeds ~~World~~leverages ~~Emoji~~its ~~Awards.~~global Increator ~~July 2024~~network, ~~Emojipedia~~tens ~~received~~of ~~approximately~~thousands ~~37.6 million~~of ~~monthly~~photographers ~~page~~from ~~views~~ GuruShots and ~~has~~creators ~~approximately~~from ~~9.6~~Zedge ~~million~~to ~~monthly~~fulfill ~~active~~highly ~~users~~specific asclient ofbriefs ~~July~~across 31geographies, ~~2024~~themes, ofand ~~which~~use ~~approximately 46~~cases.7% ~~are located~~DataSeeds inaddresses ~~well-developed~~a ~~markets.~~critical challenge Itfacing isfoundational ~~the~~models ~~top~~today: ~~resource~~the need for ~~all~~edge-case ~~things~~visual ~~emoji,~~content ~~offering~~to ~~insights~~improve ~~into~~accuracy ~~data~~ and ~~cultural trends~~performance. AsEach aasset can ~~member~~be ofenhanced ~~the~~with ~~Unicode~~detailed ~~Consortium~~annotations, ~~the~~segmentation ~~standards~~masks, ~~body~~technical ~~responsible~~metadata, ~~for~~and ~~approving~~peer-based ~~new~~quality ~~emojis~~rankings, ~~Emojipedia~~ensuring ~~works~~datasets ~~alongside~~are both ~~major~~robust ~~emoji~~and ~~creators including~~production-ready. ~~Apple,~~With ~~Google,~~scalable ~~Meta,~~infrastructure and Xfast turnaround times, ~~formerly~~DataSeeds ~~known~~is asa ~~Twitter~~powerful partner for enterprises building the next generation of AI-powered applications.

WeIn ~~believe~~April 2022, we acquired GuruShots Ltd (“GuruShots”), a gamified photography platform that ~~Emojipedia~~engages ~~provides~~a ~~growth~~global ~~potential~~community of photographers through daily challenges, real-time feedback, and a competitive, tointeractive experience. GuruShots offers a platform spanning iOS, Android, and the ~~Zedge~~web ~~App~~that provides a fun, educational and itstructured way ~~was~~for ~~immediately~~amateur ~~accretive~~photographers to ~~earnings~~compete ~~post~~in ~~acquisition~~a inwide ~~August~~variety ~~2021~~of contests showcasing their photos while gaining recognition with votes, badges, and awards. InWe estimate that the ~~past~~total ~~year,~~addressable wemarket ~~have~~of ~~made~~amateur ~~many~~photographers ~~changes~~ using their smartphones to ~~Emojipedia~~take ~~including~~and ~~overhauling~~publicly share artistic photos is 30-40 million people per month and that the market is still in its ~~backend~~infancy. Every month, ~~redesigning~~GuruShots ~~the~~stages ~~Emojipedia~~more ~~website~~than 300 competitions that result in players uploading in excess of 550,000 photographs and ~~introducing~~casting ~~new~~close ~~entertainment-focused~~to ~~features~~2.8 billion “perceived votes,” towhich are calculated by multiplying the ~~site.~~number Weof ~~will~~votes ~~continue~~that toeach ~~enhance~~player ~~this~~casts ~~offering~~by ~~and~~a ~~are~~weighting ~~exploring~~factor ~~additional~~based ~~new~~on ~~features~~various ~~which~~factors ~~use~~related to ~~artificial~~that ~~intelligence~~user. To improve engagement, ~~some~~ GuruShots has adopted a set of ~~which~~retention ~~will~~dynamics befocused ~~released~~on ~~before~~individual, ~~the~~team ~~end~~and community dynamics that create a sense of ~~the~~belonging, ~~calendar~~inspiration, ~~year~~recognition, improvement, and competition.

~~Our~~GuruShots utilizes ~~Strategy~~a ‘Free-to-Play’ business model and generates revenue through in-app purchases of virtual currency. Players can use this currency to unlock competitions or gain an edge by purchasing resources and participating in additional gameplay. Over the past eight years, the monthly average paying player spend has increased in excess of 6.2% annually to more than $40.9 per player.

~~Our~~In fiscal ~~vision~~2024, iswe torevamped ~~provide~~GuruShots’ ~~tools~~customer ~~that~~onboarding ~~enable~~experience ~~easy~~by guiding new players through simplified photo competitions of limited size and ~~high-quality~~duration. ~~digital~~The ~~content~~upgrade ~~creation,~~was ~~connect~~designed to enhance the ~~creators~~gaming ~~together~~experience ~~with~~for ~~friendly~~new ~~competitions~~players by increasing their potential for winning and ~~expose~~providing ~~the~~immediate ~~content~~gratification. toThe ~~communities~~new onboarding has shown improvements in engagement, retention, and revenue from ofnew ~~prospective~~users. ~~consumers~~In addition, we migrated to a coin-based economy with multiple currencies in order to ~~drive~~enable ~~commerce~~more players to earn and spend their currency on in-game resources.

Since the acquisition, GuruShots has faced challenges in growth and profitability, and its revenue has declined. We have cut costs at GuruShots, including as part of the restructuring implemented in January 2025, and have materially scaled back on paid user acquisition (PUA) for the unit. In parallel, we are developing a plan, referred to as GuruShots 2.0, to revamp GuruShots’ offering in order to put it on a growth trajectory and unlock the potential value of this asset. Our ~~Strategic~~strategy ~~Flywheel~~focuses on attracting new users and converting them into recurring, paying players. To date, we have introduced a fun and comprehensive onboarding experience to draw new users into the gameplay with ease and migrated to a coin-based in-game economy to enable more opportunities to reward and monetize players

~~Our~~Historically, we ~~long-term~~marketed ~~strategy~~GuruShots ~~calls~~to ~~for~~prospective ~~creating~~players ~~and supporting~~primarily avia ~~flywheel~~PUA ~~that~~channels ~~leverages~~including ~~the~~Google, ~~synergies of content creation~~Meta, ~~gaming~~TikTok and ~~marketplaces~~other byplatforms, ~~empowering consumers with easy-to-use~~utilizing ~~content creation utilities whose output can be used to engage across~~ a ~~multitude~~variety of ~~online~~advertising ~~and~~media, ~~mobile platforms including social networks~~formats, ~~messaging,~~ ~~and~~such ~~gaming~~ as ~~well~~static asand ~~for~~video ~~commerce purposes~~ads. ~~This~~As ispart ~~unlike~~of the ~~existing~~GuruShots ~~dynamic~~2.0 ~~that~~development ~~many gaming platforms offer to players~~plan, ~~who~~ ~~can~~we ~~create~~have ~~and sell virtual goods that are valuable only within the context of that particular ecosystem. Although the foundation~~significantly ofreduced ~~our~~PUA ~~strategy~~investment isfor ~~currently~~GuruShots ~~centered~~to ~~around~~improve ~~the~~Return-on-Ad-Spend ~~Zedge~~(ROAS) ~~Marketplace~~ and ~~GuruShots,~~intend ~~over time we expect~~ to ~~expand~~continue ~~into~~managing ~~other~~PUA ~~content~~spend ~~verticals that~~in ~~have~~the ~~relevance~~current ~~beyond gameplay~~timeframe.

~~Using~~In addition ~~our~~to ~~current~~its ~~products~~potential as ~~an example, GuruShots is~~ a ~~skill-based~~standalone game ~~that attracts creators (mainly~~, ~~amateur~~we ~~photographers) with friendly photo competitions in which they compete to gain recognition and pedigree. We~~ believe that ~~adding~~ the ~~ability~~extensive tolibrary ~~sell~~of ~~their~~photographs ~~content~~generated toby ~~Zedge~~GuruShots ~~Marketplace’s~~players ~~25+~~through submissions ~~million~~to ~~MAU~~GuruShots’ ~~is an~~competitions ~~attractive~~represents ~~benefit~~a ~~that~~valuable ~~enables~~dataset ~~players~~for ~~not~~our ~~only~~emerging toDataSeeds ~~have~~offering. ~~fun~~To date, ~~but~~we ~~also~~have secured rights to ~~earn~~license ~~money~~a ~~while~~portion ~~doing~~of ~~so.~~this ~~This~~library ~~dual~~for ~~purpose~~various ~~will~~applications, ~~likely improve~~including ~~user~~AI ~~growth~~training, ~~engagement, retention,~~ and ~~monetization~~we ~~while~~continue ~~simultaneously~~to ~~expanding~~expand ~~our~~the ~~relevance~~licensable catalog toby asecuring ~~broader~~rights ~~community~~to ~~interested in~~additional ~~high-quality~~ photographs. IfWe ~~our~~believe ~~strategy~~the isscale ~~correct,~~and wedistinctive ~~will~~characteristics ~~have~~of athis ~~flywheel~~dataset ~~that~~position ~~drives the aforementioned KPIs while also enabling~~it usas toa ~~expand~~meaningful ~~into~~resource ~~new~~for ~~verticals~~DataSeeds’ ~~(through~~target ~~internal development or acquisition), gamify them, and add new content to our marketplace~~market.

~~Executing~~In August ~~this~~2021, ~~strategy~~we ~~calls~~acquired ~~for~~Emojipedia ~~concentrating~~Pty Ltd (“Emojipedia”), the world’s leading authority dedicated to providing up-to-date ~~our~~and ~~efforts~~well-researched onemoji definitions, information, and news, as well as World Emoji Day and the ~~following~~annual ~~goals:~~World Emoji Awards. In July 2025, Emojipedia received approximately 48.4 million monthly page views and has approximately 8.9 million monthly active users as of July 31, 2025 of which approximately 46.2% are located in well-developed markets. It is the top resource for all things emoji, offering insights into data and cultural trends.

~~● Invest in growing our user base and improving profitably. We expect to continue devoting resources to growing our user base profitably by:~~2

○Post its ~~analyzing~~acquisition ~~user~~in ~~demographics~~August to2021, ~~identify~~Emojipedia ~~key~~was ~~segments~~immediately ~~that~~accretive ~~yield~~to earnings. In the ~~highest~~past ~~profitability~~year, ~~and~~we ~~quickest~~have ~~return~~implemented onmultiple adchanges to ~~spend~~Emojipedia ~~(ROAS);~~including an AI-powered emoji sticker generator tool as well as an extensive emoji sticker library.

3In late September 2025, Google released an update to its Search Engine Results Page (SERP) enabling users to copy emojis directly from search results rather than being directed to third-party sites such as Emojipedia. In addition, AI platforms, including ChatGPT and Claude, now return emoji results in response to user queries. While it is too early to accurately quantify the impact of these changes on Emojipedia’s monthly active users (MAU), we believe they are likely to result in reduced traffic and adversely affect revenue. In light of these developments, we are evaluating potential mitigation strategies and will determine whether such measures warrant investment given the associated costs and expected benefits.

~~○ testing to determine which user segments are most responsive to new offerings and crafting targeted marketing strategies based on those insights;~~Our Strategy

○Our vision ~~studying~~is ~~our~~to ~~users’~~provide ~~needs~~tools that enable easy and ~~enhancing~~high-quality ~~our~~digital ~~products~~content tocreation, ~~align~~connect the creators together with friendly competitions and expose the ~~preferences~~content to communities of ~~our~~prospective ~~most~~consumers ~~profitable~~in ~~segments;~~order to drive commerce.

○Our Strategic ~~developing and offering new features and services that are attractive to both new and existing users;~~Flywheel

○Our long-term ~~investing~~strategy incalls ~~paid~~for ~~user~~creating ~~acquisition~~and ~~campaigns~~supporting a flywheel that ~~yield~~leverages ~~profitable~~the ~~customers~~synergies of content creation, ~~based~~gaming onand ~~empirical~~marketplaces by ~~data~~empowering consumers with easy-to-use content creation utilities whose output can be used to engage across a multitude of online and mobile ~~focused~~platforms including social networks, ~~primarily~~messaging, onand gaming as well~~-developed~~ ~~markets;~~as for commerce purposes. This is unlike the existing dynamic that many gaming platforms offer to players, who can create and sell virtual goods that are valuable only within the context of that particular ecosystem. Although the foundation of our strategy is currently centered around existing offerings, over time we expect to expand into other content verticals that have relevance beyond gameplay and we continuously evaluate our units to determine which best fit into our strategic goals in their current forms, which need revamping and which no longer support our long term goals.

○One example ~~exploring~~of ~~crossover~~this ~~marketing~~approach ~~opportunities~~in ~~between~~practice using our current is GuruShots. GuruShots is a skill-based game that attracts creators (mainly, amateur photographers) with friendly photo competitions in which they compete to gain recognition and pedigree. We believe that adding the ability for them to benefit by availing their content to third-parties is an attractive benefit that enables players not only to have fun, but also to earn money while doing so. If this dual purpose resonates well with our players it may contribute to improving user ~~segments~~growth and increasing the lifetime value. It will also enable us to ~~maximize~~expand ~~reach~~our marketplace with a business-to-business offering where we can sell to enterprises including technology companies, stock photo sites, ecommerce vendors, to name a few. Recently, we have begun to utilize the extensive library of photographs generated by GuruShots players through submissions to GuruShots’ competitions as a dataset for our emerging DataSeeds offering. This is an example of our ongoing efforts to apply our assets and ~~engagement;~~strengths to support existing or new offerings that will enhance the value creation of our company.

○Executing this ~~expanding~~strategy ~~our~~calls ~~reach~~for byconcentrating ~~collaborating~~our ~~with~~efforts ~~strategic~~on ~~partners.~~the following goals:

● ~~Improve~~Invest ~~monetization. Continue developing monetization methods that will help us grow, including advancements of the~~ in~~-app~~ ~~economy,~~growing ~~subscription models, e-commerce, and new advertising products, implementations, and optimizations. For example, in fiscal 2024 we revamped~~ our ~~subscription~~user ~~offering~~base and ~~have~~improving ~~experienced growth as a result of this overhaul~~profitably. We ~~believe~~expect ~~that our products and customer base are attractive~~ to ~~advertisers,~~continue ~~brands,~~devoting ~~artists,~~resources ~~and players and will yield new monetization opportunities. In addition, we expect that we will be able~~ to ~~capitalize~~growing ~~on cross marketing~~ our ~~suite~~user ofbase ~~products~~profitably ~~to this customer base.~~by:

●○ ~~Continue~~analyzing touser ~~invest~~demographics ~~in product and technology investment in and across our product suite. We plan~~ to ~~make~~identify ~~continued,~~key ~~selected~~segments ~~investments in product feature sets and functionality in order to both maintain our existing user base and attract new users. In addition, we envision applying our product expertise to verticals~~ that weyield ~~currently do not have in our portfolio. For example, we launched pAInt, our generative AI wallpaper maker in late 2022 in order to avail our consumers with~~ the ~~ability~~highest ofprofitability ~~becoming~~and ~~creators.~~quickest ROAS;

● Better utilize data to improve user acquisition and customer engagement. We plan to better utilize data to improve the user experience, scale profitable user acquisition and improve the use of our product through personalized recommendations and content feeds, enhanced search and content discovery, and optimized pricing. We have benefitted from the investment we have made in our data and business analytics teams enabling us to make data driven decisions in shortened timeframes and also expand the number of A/B tests that we use to compare various product changes.3

●○ ~~Build~~testing ~~our~~to ~~marketplace~~determine ~~into~~which auser ~~compelling~~segments ~~platform~~are ~~for~~most ~~artists~~responsive ~~and creators. Our goal is~~ to ~~build~~new ~~our~~offerings ~~marketplace into one that artists view as prioritizing their needs~~ and ~~addressing~~crafting ~~all~~targeted ~~aspects of their~~ marketing ~~and~~strategies ~~revenue~~based ~~generation~~on ~~goals~~those ~~including, but not limited to, ease in managing their virtual storefront, promotion, education, reporting, and distribution.~~insights;

●○ ~~Increase~~studying our ~~marketing~~users’ ~~efforts.~~needs ~~We use our full-stack marketing team to scale user acquisition--both paid~~ and ~~organic--invest~~enhancing ~~in building and/or buying data analytic tools that provide valuable insights into~~ our ~~marketing~~products ~~initiatives and focus on the evolving fields of search engine optimization and app store optimization. We have also invested resources~~ to ~~improve~~align ~~product marketing~~ with the ~~goal~~preferences of ~~driving~~our ~~engagement~~most ~~and~~profitable ~~retention. Finally, we have utilized AI to quickly and efficiently create many different creatives in order to attract new customers.~~segments;

●○ ~~Diversify~~developing ~~our~~and ~~revenue stack. Historically, the majority of our revenue has been derived from advertising. We plan to continue diversifying our revenue streams by advancing our existing subscription~~ offering, ~~optimizing~~new ~~the~~features ~~newly introduced coin-based economy in GuruShots,~~ and ~~introducing~~services ~~advertising~~that ~~into~~are ~~GuruShots.~~attractive ~~Furthermore, we expect~~ to ~~continue~~both ~~testing our print on demand offering. We also have a set of product initiatives specific to Emojipedia that will enable~~ new ~~revenue~~and ~~streams~~existing ~~from this asset.~~users;

●○ ~~Selectively~~investing ~~pursue strategic investments, partnerships, and acquisitions. On a selective basis, we will look to invest~~ in, ~~partner~~paid ~~with,~~user oracquisition ~~purchase~~campaigns ~~entities~~ that ~~can~~yield ~~provide~~profitable ~~synergistic~~customers, ~~growth~~based ~~opportunities~~on ~~for~~empirical ~~our~~data ~~Zedge Marketplace~~ and ~~otherwise.~~focused, ~~For example~~primarily, ~~in April 2022 we acquired GuruShots and in August 2021 we acquired Emojipedia. Each of these acquisitions offers new growth opportunities both~~ on ~~a stand~~well-~~alone~~developed ~~basis~~markets; ~~as well as on an integrated~~ and ~~synergistic basis that we believe can impact our business in a materially positive fashion.~~

4○ exploring crossover marketing opportunities between user segments to maximize reach and engagement.

~~Our~~● ~~Competitive~~Improve ~~Advantages~~monetization. Continue developing monetization methods that will help us grow, including advancements of the in-app economy, subscription models, e-commerce, and new advertising products, implementations, and optimizations. For example, in fiscal 2024 we revamped our subscription offering and have experienced growth as a result of this overhaul. We believe that our products and customer base are attractive to advertisers, brands, artists, and players and will yield new monetization opportunities. In addition, we expect that we will be able to capitalize on cross marketing our suite of products to this customer base.

● Continue to invest in product and technology in and across our product suite. We ~~believe~~plan to make continued, selected investments in product feature sets and functionality in order to both maintain our existing user base and attract new users. In addition, we envision applying our product expertise to verticals that ~~the~~we ~~following~~currently ~~competitive~~do ~~strengths will~~not ~~drive~~have in our portfolio. For example, we launched pAInt, our generative AI wallpaper maker in late 2022 in order to avail our consumers with the ~~growth~~ability of ~~our~~becoming ~~business:~~creators.

● ~~Large,~~Better ~~global~~utilize ~~customer~~data ~~base.~~to Weimprove ~~benefit~~user ~~from~~acquisition ~~having~~and ~~a large~~ customer ~~base~~engagement. AsWe ofplan ~~July~~to ~~31,~~better ~~2024,~~utilize ~~the~~data ~~Zedge~~to ~~App~~improve ~~had~~the ~~26.1~~user ~~million MAU~~experience, ofscale ~~which~~profitable ~~approximately~~user ~~21.1%~~acquisition ~~were in well-developed markets~~ and ~~78.9%~~improve ~~were~~the inuse ~~emerging~~of ~~markets.~~our ~~Typically,~~product ~~customers~~through inpersonalized ~~well-developed~~recommendations ~~markets~~and ~~monetize~~content atfeeds, aenhanced ~~material~~search ~~premium~~and ~~when~~content ~~compared~~discovery, toand ~~those~~optimized ~~in emerging markets~~pricing. ~~The~~We ~~Android~~have ~~version~~benefited offrom the ~~Zedge~~investment ~~App~~we ishave ~~available~~made in 17our ~~languages~~data and ~~Emojipedia~~business isanalytics ~~available~~teams inenabling 19us ~~languages. We possess a highly diversified portfolio of content and attribute this in part~~ to ~~our~~make ~~global~~data ~~reach~~driven ~~which~~decisions ~~makes us attractive to creators interested~~ in ~~meeting~~shortened ~~various~~timeframes ~~customer tastes~~ and ~~preferences.~~also Inexpand ~~addition,~~the ~~our~~number ~~diverse~~of ~~customer~~A/B ~~base~~tests ~~attracts advertisers seeking customers~~ that ~~have~~we ~~adequate~~use ~~disposable income~~ to ~~purchase~~compare ~~their~~various ~~products~~product ~~and services~~changes. ~~Our Zedge Marketplace’s large customer base is also a draw to artists and brands looking to market their content to a critical mass of users.~~

● ~~Leading~~Build ~~global~~our ~~provider~~marketplaces ofinto ~~mobile personalization content. The Zedge App has~~ a ~~global~~compelling ~~customer~~platform ~~base~~for ofartists ~~approximately~~and 26creators. ~~million~~One ~~MAU~~goal aswe ofhave ~~July~~set ~~31,~~for ~~2024,~~ourselves ~~enabling~~is ~~users~~ to ~~easily~~build ~~personalize~~marketplaces ~~their~~where ~~mobile~~artists’ ~~phones~~needs ~~with~~are aprioritized ~~wide~~and ~~variety~~where ofthey ~~free,~~can ~~high-quality~~generate ~~ringtones,~~incremental ~~wallpapers,~~income ~~notification~~or ~~sounds,~~benefits ~~video~~from ~~wallpapers,~~their ~~custom~~artwork. ~~app~~As ~~icons~~we ~~(only~~upgrade ~~available~~offerings ~~for~~(including ~~iOS),~~the asdeveloping ~~well~~GuruShots ~~as create bespoke wallpapers with pAInt, our generative AI wallpaper maker~~2.0) Weor ~~believe~~introduce ~~that~~new ~~the~~products ~~Zedge~~and ~~Marketplace~~services, iswe ~~well~~seek ~~positioned~~to ~~for~~determine ~~continued~~which ~~leadership~~features incan ~~the~~support ~~personalization~~this ~~space~~goal.

● ~~Deep~~Increase ~~Knowledge~~our ofmarketing ~~Gaming~~efforts. We ~~have~~use ~~leaders~~our ~~with~~full-stack ~~years~~marketing ofteam ~~experience~~to scale user acquisition—both paid and organic—invest in building and/or ~~operating~~buying ~~games~~data ofanalytic ~~skill~~tools ~~across~~that ~~digital~~provide ~~platforms~~valuable ~~including~~insights ~~iOS,~~into ~~Android,~~our marketing initiatives and ~~web~~focus on the evolving fields of search engine optimization and app store optimization. We ~~intimately~~have ~~understand~~also ~~game~~invested ~~design,~~resources ~~onboarding,~~to ~~game~~improve ~~mechanics,~~product ~~LiveOps,~~marketing ~~feedback~~with ~~loops,~~the ~~in-game~~goal ~~resource~~of ~~balancing,~~driving ~~scarcity,~~engagement and ~~how~~retention. toFinally, ~~make~~we autilize ~~game~~AI ~~fun,~~to ~~challenging,~~quickly and ~~fair~~efficiently market to prospective users.

● ~~Extensive~~Diversify ~~Experience~~our ~~Combining~~revenue ~~Gaming and a Real-World Activity~~stack. WeHistorically, ~~have~~the ~~years~~majority of ~~experience~~our inrevenue ~~combining~~has ~~game~~been ~~dynamics~~derived ~~with~~from ~~a real-world activity~~advertising. InWe ~~the~~plan ~~case~~to ofdiversify ~~GuruShots~~our ~~the~~revenue ~~real-world~~streams, ~~activity~~most isrecently ~~photography.~~by ~~Successfully~~enabling ~~combining~~GuruShots’ ~~these~~players isto ~~non-trivial~~monetize ~~and~~their ~~requires~~content, awith ~~great~~the ~~deal~~Company ofretaining ~~expertise~~a ~~and~~portion ~~understanding~~of ~~that~~ the ~~team has acquired over the years~~proceeds.

● ~~High-quality~~Product ~~products~~Innovation Team. We dohave ~~our~~established ~~best~~a toProduct ~~provide~~Innovation ~~our~~Team ~~customers~~to ~~with~~leverage ~~high-quality~~AI, ~~products~~vibe coding, and ~~superior~~automations ~~user~~in ~~experiences.~~order Weto ~~prioritize~~accelerate ~~our~~the ~~customers’~~development ~~needs~~of ~~and~~minimally ~~believe~~viable ~~that~~products ~~this~~(“MVPs”) ~~focus is critical for our long-term growth~~ and ~~expansion.~~rapidly Wedetermine, ~~invest~~based ~~significant~~on ~~resources~~empirical indata, ~~product~~which ~~development,~~concepts ~~design,~~merit ~~and~~further ~~usability~~investment. WeOur ~~beta~~enterprise-wide ~~test~~adoption ~~product~~of ~~enhancements~~AI ~~extensively~~is ~~and~~yielding ~~closely~~efficiencies ~~monitor customer feedback to ensure~~ that weare ~~meet~~enabling ~~users’~~us ~~needs.~~to Toachieve ~~date~~this goal, ~~our~~allowing ~~Zedge~~us ~~App~~to ~~has~~reallocate ~~received~~employees ~~more~~from ~~than~~existing 15product ~~million~~responsibilities ~~reviews~~to innew ~~Google~~product ~~Play~~development. ~~where~~In itearly ~~boasts~~fiscal a2026, ~~4.7~~we ~~star~~launched ~~rating~~an ~~out~~MVP of aan ~~maximum~~app, ofdeveloped 5in ~~stars.~~just ~~GuruShots~~weeks ~~has~~by a ~~4.4-star~~streamlined ~~rating~~team inof ~~the~~two ~~App~~engineers ~~Store~~and ~~albeit~~one ~~from a universe of several thousand reviews~~designer.

● ~~Human~~Selectively ~~Capital.~~pursue Westrategic ~~have~~investments, apartnerships, ~~team~~and ofacquisitions. ~~highly~~On ~~experienced~~a ~~professionals~~selective ~~that~~basis, ~~take~~we ~~pride~~will ~~and~~look ~~ownership~~to invest in, ~~their~~partner ~~work~~with, ~~product.~~or ~~Our~~purchase ~~diverse~~entities ~~employee~~that ~~base~~can isprovide ~~passionate~~synergistic ~~about~~growth opportunities for our ~~product~~Zedge ~~suite~~Marketplace and ~~its~~otherwise. ~~mission~~For toexample, ~~make~~in ~~our~~April ~~strategy~~2022 awe ~~reality.~~acquired ~~Our~~GuruShots ~~culture is founded on respect~~ and ~~empowerment~~in ~~which~~August ~~are~~2021 ~~critical~~we inacquired ~~light~~Emojipedia. Each of usthese ~~having~~acquisitions ~~offices~~offers innew ~~four~~growth ~~different~~opportunities ~~countries~~both ~~with~~on a ~~hybrid in~~stand-~~person~~alone ~~work~~basis ~~attendance~~as ~~policy.~~well Weas ~~strive~~on ~~to create~~ an ~~environment~~integrated ~~where~~and ~~our~~synergistic ~~employees~~basis ~~can~~that bewe ~~autonomous~~believe ~~and~~can ~~creative.~~impact ~~Our~~our ~~people~~business ~~possess deep expertise~~ in ~~product~~a ~~design~~materially ~~and~~positive ~~management, development, marketing, monetization, data and analytics and operations~~fashion.

● Management team. We have an experienced management team with longstanding tenure with the company and deep knowledge of the mobile app landscape who are highly focused on execution. Our core management team possesses a solid understanding of the mobile app industry, product design and development, operations, and monetization. Collectively, our management team has a proven ability in building and scaling a business and pursuing opportunities with a manageable risk profile.4

~~● Large and diverse content catalog.~~ Our Competitive large and diverse catalog of content includes wallpapers, ringtones, notification sounds, video wallpapers, photographs, and emojis. With artists and contributors spanning the globe, we have assembled a vast array of both user generated and licensed content to meet the needs of our users.Advantages

5We believe that the following competitive strengths will drive the growth of our business:

● ~~Scalable~~Large, ~~and~~global ~~Reliable~~customer ~~Technology~~base. ~~and~~We ~~infrastructure~~benefit from having a large customer base. ~~Our~~As ~~products~~of ~~are~~July ~~built~~31, ~~upon~~2025, ~~scalable~~the ~~technology~~Zedge App had 23.3 million MAU, of which approximately 23.3% were in well-developed markets and ~~infrastructure~~76.7% ~~that~~were ~~reliably~~in ~~serves~~emerging ~~tens~~markets. ofTypically, ~~millions~~customers in well-developed markets monetize at a material premium when compared to those in emerging markets. The Android version of ~~MAU,~~the ~~globally~~Zedge App is available in 14 languages and Emojipedia is available in 19 languages. We ~~use~~possess a ~~combination~~highly diversified portfolio of ~~off-the-shelf~~content and ~~proprietary~~attribute ~~technologies~~this in part to our global reach which makes us attractive to creators interested in meeting various customer tastes and ~~infrastructure~~preferences. ~~solutions~~In addition, our diverse customer base attracts advertisers seeking customers that ~~scale~~have ~~efficiently~~adequate disposable income to ~~meet~~purchase ~~the~~their ~~needs~~products ofand ~~our~~services. Our Zedge Marketplace’s large customer base is also a draw to artists and brands looking to market their content to a critical mass of users.

~~Competition~~● Leading global provider of mobile personalization content. The Zedge App has a global customer base of approximately 23.3 million MAU as of July 31, 2025, enabling users to easily personalize their mobile phones with a wide variety of free, high-quality ringtones, wallpapers, notification sounds, video wallpapers, custom app icons (only available for iOS), as well as create bespoke wallpapers with pAInt, our generative AI creation suite. We believe that the Zedge Marketplace is well positioned for continued leadership in the personalization space.

● Deep Knowledge of Gaming. We ~~face~~have ~~competition~~leaders with years of experience in ~~all~~building ~~aspects~~and operating games of ~~our~~skill ~~business~~ across digital platforms including iOS, Android, and ~~especially~~web. ~~from~~We ~~other~~intimately ~~digital~~understand ~~marketplaces~~game design, onboarding, game mechanics, LiveOps, feedback loops, in-game resource balancing, scarcity, and ~~gaming~~how ~~companies.~~to Inmake ~~running~~a ~~our~~game ~~business~~fun, wechallenging, ~~compete~~and ~~for:~~fair.

● ~~Consumers~~Extensive Experience Combining Gaming and a Real-World Activity. We ~~compete~~have ~~for~~years ~~consumers’~~of ~~leisure~~experience ~~time,~~in ~~attention,~~combining ~~and~~game ~~spending~~dynamics ~~versus~~with ~~alternative~~a ~~forms~~real-world ofactivity. ~~entertainment~~In ~~that~~the ~~are~~case ~~available~~of toGuruShots ~~them~~the asreal-world ~~well~~activity asis ~~against~~photography. ~~online~~Successfully ~~platforms~~combining these is non-trivial and ~~marketplaces~~requires ~~that~~a ~~offer~~great ~~utility~~deal of expertise and ~~content~~understanding ~~for~~that ~~mobile~~the ~~phone~~team ~~personalization~~has acquired over the years.

● ~~Content~~High-quality ~~creators~~products. ~~There~~We ~~are~~do ~~many~~our ~~online~~best ~~platforms~~to provide our customers with high-quality products and superior user experiences. We prioritize our customers’ needs and believe that ~~offer~~this ~~content~~focus ~~creators~~is ancritical ~~ecosystem~~for our long-term growth and expansion. We invest significant resources in ~~which~~product ~~they~~development, ~~can~~design, ~~make~~and ~~their~~usability. ~~content~~We ~~available~~beta test product enhancements extensively and closely monitor customer feedback to ~~consumers~~ensure that we meet users’ needs. ~~Some~~To date, our Zedge App has received more than 16 million reviews in Google Play where it boasts a 4.7 star rating out of ~~these~~a ~~platforms~~maximum ~~may~~of ~~have~~5 ~~better~~stars. ~~incentives,~~GuruShots ~~paid~~has ora ~~other,~~4.4-star ~~that~~rating ~~may~~in ~~potentially~~the ~~make~~App ~~them~~Store ~~more~~albeit ~~attractive~~from ~~than~~a ~~our~~universe ~~marketplace~~of several thousand reviews.

● ~~Advertisers~~Human Capital. We ~~face~~have ~~significant~~a ~~competition~~team of highly experienced professionals that take pride and ownership in ~~securing~~their ~~spend~~work ~~from~~product. ~~advertisers~~Our diverse employee base is passionate about our product suite and its mission to make our strategy a reality. Our culture is founded on respect and empowerment which are critical in light of us having offices in four different countries with a hybrid in-person work attendance policy. We strive to create an environment where our employees can be autonomous and creative. Our people possess deep expertise in product design and management, development, marketing, monetization, data and analytics and operations.

● ~~Other~~Management ~~Game Developers~~team. ~~Game~~We ~~developers~~have ~~that~~an ~~offer~~experienced ~~engaging~~management ~~and~~team ~~interesting~~with ~~games.~~longstanding ~~These~~tenure ~~competitors,~~with ~~many~~the company and deep knowledge of ~~whom~~the wemobile ~~may~~app ~~not~~landscape bewho ~~aware~~are ~~of,~~highly ~~may~~focused beon ~~more~~execution. ~~proficient~~Our atcore ~~capitalizing~~management onteam ~~user~~possesses ~~acquisition~~a ~~channels~~solid inunderstanding ~~order~~of tothe ~~gain~~mobile ~~access~~app toindustry, ~~large~~product ~~user~~design ~~bases~~and development, operations, and ~~their~~monetization. ~~network~~Collectively, ~~effects~~our tomanagement ~~expand~~team ~~virally~~has a proven ability in building and ~~quickly~~scaling a business and pursuing opportunities with a manageable risk profile.

● ~~Alternative~~Large ~~options~~ and ~~products~~diverse ~~for~~content ~~mobile~~catalog. ~~personalization,~~Our ~~generative~~large ~~AI image creation, games~~ and ~~emojis.~~diverse ~~There~~catalog ~~are~~of ~~many~~content ~~other~~includes ~~marketplaces~~wallpapers, ~~and~~ringtones, ~~platforms~~notification ~~that~~sounds, ~~offer~~video ~~mobile~~wallpapers, ~~personalization content~~photographs, ~~generative~~and AIemojis. ~~creation~~With ~~tools,~~artists ~~games,~~ and ~~emoji~~contributors ~~resources,~~spanning ~~some~~the ofglobe, ~~whom~~we ~~are~~have ~~better~~assembled ~~funded~~a ~~than~~vast wearray ~~are.~~of Weboth ~~believe~~user ~~that~~generated weand ~~possess~~licensed acontent ~~competitive~~to ~~advantage~~meet ~~because~~the needs of our: users.

~~○ large user base;~~5

○● ~~“one-stop~~Scalable ~~shop”~~and ~~approach~~Reliable toTechnology ~~mobile~~and ~~personalization~~infrastructure. ~~and~~Our ~~creation~~products ~~features,~~are ~~which~~built ~~avails~~upon ~~customers~~scalable ~~with~~technology aand ~~wide~~infrastructure ~~array~~that reliably serves tens of ~~ringtones,~~millions ~~wallpapers~~of MAU, ~~notification~~globally. ~~sounds,~~We use a combination of off-the-shelf and ~~video~~proprietary ~~wallpapers~~technologies ~~within~~and infrastructure solutions that scale efficiently to meet the ~~same~~needs ~~Android~~of ~~app;~~our large customer base.

○ flexibility that allows the customer to selectively choose what they would like to personalize without handing over the core elements of the native operating system to a third party and overwhelming the user with a myriad of complex options;Competition

○We face ~~large~~competition ~~content~~in ~~catalog;~~all aspects of our business and especially from other digital marketplaces and gaming companies. In running our business, we compete for:

○● ~~recognized~~Consumers. We compete for consumers’ leisure time, attention, and spending versus alternative forms of entertainment that are available to them as well~~-respected~~ ~~brands;~~as against online platforms and marketplaces that offer utility and content for mobile phone personalization.

○● ~~proprietary~~Content ~~recommendation~~creators. ~~engine;~~There ~~and~~are many online platforms that offer content creators an ecosystem in which they can make their content available to consumers. Some of these platforms may have better incentives, paid or other, that may potentially make them more attractive than our marketplace.

○● ~~market~~Advertisers. ~~ranking~~We ~~and~~face ~~longevity~~significant competition in securing spend from advertisers.

● ~~Rapid-Paced~~Other Game and ~~Changing World of~~ Mobile App ~~Development~~Developers. ~~The~~Game and mobile app ~~ecosystem~~developers ~~changes~~that ~~quickly~~offer engaging and ~~regularly~~interesting ~~with~~products ~~new~~are ~~apps~~competitors ~~capturing~~and ~~massive~~we ~~audiences~~may ~~competing~~not ~~for~~be ~~consumers’~~aware ~~time,~~of ~~mindshare,~~many ~~and~~of ~~money.~~them ~~This~~who ismay anbe ~~ongoing~~more ~~competitive~~proficient ~~threat~~at ~~requiring~~capitalizing uson touser doacquisition ~~our~~channels ~~best~~in order to ~~adapt~~gain asaccess ~~necessary~~to large user bases and their network effects to ~~remain~~expand ~~relevant~~virally and ~~meaningful~~quickly.

6● Alternative options and products for mobile personalization, generative AI creation tools, games and emojis. There are many other marketplaces and platforms that offer mobile personalization content, generative AI creation tools, games, and emoji resources, some of whom are better funded than we are. We believe that we possess a competitive advantage because of our:

~~Our~~○ ~~History~~large user base;

In○ ~~2003,~~“one-stop ~~Tom~~shop” ~~Arnoy,~~approach ~~Kenneth~~to ~~Sundnes,~~mobile personalization and ~~Paul Shaw~~creation ~~launched~~features, awhich ~~consumer~~avails ~~website~~customers atwith ~~www.zedge.net~~a ~~that~~wide ~~people~~array ~~used~~of toringtones, ~~upload~~wallpapers, notification sounds, and ~~download~~video ~~ringtones.~~wallpapers within the same Android app;

In○ ~~December~~flexibility ~~2006,~~that ~~IDT~~allows ~~Corporation~~the ~~acquired~~customer ~~90% of~~to ~~Zedge.~~selectively ~~Zedge~~choose ~~Holdings,~~what ~~Inc.~~they ~~was~~would ~~incorporated~~like into ~~Delaware~~personalize inwithout ~~2008,~~handing ~~and~~over ~~our~~the ~~name~~core ~~was~~elements ~~changed~~of the native operating system to ~~Zedge,~~a ~~Inc.~~third inparty ~~2016.~~and overwhelming the user with a myriad of complex options;

In○ ~~2016,~~large ~~IDT~~content ~~Corporation spun off our stock to its stockholders, and our Class B common stock was listed on the NYSE American with the ticker symbol “ZDGE”.~~catalog;

In○ ~~March~~recognized ~~2018, we completed the launch of Zedge Premium, a section of our marketplace where artists can launch a virtual store~~ and ~~market,~~well-respected ~~distribute, and sell their digital content, including wallpapers, video wallpapers, ringtones, and notification sounds to our users.~~brands;

In○ ~~January~~proprietary ~~2019,~~recommendation weengine; started offering freemium Zedge App Android users the ability to convert into paying subscribers in exchange for removing unsolicited advertisements from our Zedge App. As of July 31, 2023, we had approximately 638,000 active subscribers. In April 2023, we introduced a subscription tier in the iOS version of the app.and

In○ ~~August~~market ~~2021,~~ranking ~~we acquired Emojipedia, the world’s leading authority dedicated to providing up-to-date~~ and ~~well-researched emoji definitions, information, and news as well as World Emoji Day and the annual World Emoji Awards~~longevity.

In● ~~April~~Rapid-Paced ~~2022,~~and weChanging ~~acquired~~World ~~GuruShots,~~of aMobile ~~recognized category~~App ~~leader~~Development. ~~that~~The ~~fuses photography with~~ mobile ~~gaming.~~app ~~GuruShots,~~ecosystem ~~headquartered~~changes inquickly ~~Israel,~~and ~~offers~~regularly awith ~~platform~~new ~~spanning~~apps ~~iOS,~~capturing ~~Android, and~~massive ~~the~~audiences ~~web~~competing ~~that~~for ~~gamifies~~consumers’ ~~photography by providing a fun~~time, ~~educational~~mindshare, and ~~structured~~money. ~~way~~This ~~for~~is ~~amateur~~an ~~photographers~~ongoing –competitive ~~essentially anyone~~threat ~~with~~requiring aus ~~mobile phone –~~ to ~~compete~~do inour abest ~~wide~~to ~~variety~~adapt ofas ~~contests~~necessary ~~showcasing~~to ~~their~~remain ~~photos~~relevant ~~while~~and ~~gaining~~meaningful. ~~recognition~~● ~~with~~Distribution ~~votes, badges,~~ and ~~awards.~~Discovery OnPlatforms aincluding ~~monthly~~Google, ~~basis~~Apple, ~~GuruShots~~OpenAI, ~~users~~and ~~currently~~other ~~cast~~large ~~more~~intermediaries. ~~than~~Their 3algorithms, ~~billion~~policies ~~“perceived~~and ~~votes”~~AI-driven inresults ~~more~~increasingly ~~than 300~~surface ~~competitions.~~answers ~~GuruShots~~and ~~currently~~content ~~generates~~within ~~revenue~~the ~~from~~platform ~~selling digital resources that~~UI, ifwhich ~~used~~may ~~skillfully,~~diminish ~~can~~referral ~~provide~~traffic ~~additional visibility~~ to ~~competitors’~~our ~~photographs,~~properties aand ~~critical~~impact ~~factor~~acquisition incosts ~~securing~~and ~~votes for competitive ranking~~monetization.

In December 2022, we introduced ‘pAInt’ our generative AI wallpaper maker within the Zedge App. pAInt enables users to create high quality images by typing a brief description of what they are interested in and tuning with different style types.6

Our ~~Technology~~ History

~~Our ecosystem is powered by a scalable distributed~~In ~~platform that comprises both open source and proprietary technologies centered on content management and discovery~~2003, ~~web~~Tom ~~and app development~~Arnoy, ~~data~~ ~~science~~Kenneth ~~and analytics~~Sundnes, ~~deep learning, mobile content/device compatibility, advertising/marketing tech,~~ and ~~reporting.~~Paul WeShaw ~~have~~launched ~~built~~ a ~~robust~~consumer ~~platform~~website ~~that~~at ~~allows us to ideate, test, analyze, and launch where warranted by the outcome~~www. We enhanced our users’ content creation options with generative AI models, we embraced machine learning, including AI and LLM throughout our technology stack in order to improve content recommendations and relevancyzedge.net From an end user’s perspective, our platform minimizes response latency while factoring in cost and focuses on key areas including content creation, relevancy and discoverability. We optimize our platform by utilizing systems, algorithms, and heuristics that ~~organize~~people ~~our content based on real user data and that renders the content in a relevant fashion. We focus on delivering the highest quality content to users while minimizing our infrastructure costs on~~ used ~~bandwidth. With GuruShots, we have added open source and proprietary technologies around gamification, including ranking algorithms that ensure fair exposure~~ to ~~all~~upload ~~content in a competition,~~ and ~~real-time voting/ranking functionality at scale, and a personal competition recommendations system based on users’~~download ~~photos and historical activity~~ringtones. ~~Our infrastructure provides a fully redundant production environment in a cloud-hosted, virtual-server environment.~~

~~Intellectual~~In December ~~Property~~2006, IDT Corporation acquired 90% of Zedge. Zedge Holdings, Inc. was incorporated in Delaware in 2008, and our name was changed to Zedge, Inc. in 2016.

~~Our trademarks, copyrights, domain names, proprietary~~In ~~technology~~2016, ~~know-how,~~IDT ~~and~~Corporation ~~other~~spun ~~intellectual~~off ~~property are vital to~~ our ~~success.~~stock ~~We seek~~ to ~~protect~~its ~~our intellectual property rights by relying on federal~~stockholders, ~~state,~~ and ~~common~~our ~~law~~Class ~~rights~~B incommon ~~the~~stock ~~United~~was ~~States~~listed ~~and~~on ~~other~~the ~~countries,~~NYSE asAmerican ~~well as contractual restrictions. We enter into confidentiality and nondisclosure agreements~~ with our employees and business partners. The agreements we enter into with our employees also provide that all software, inventions, developments, works of authorship, and trade secrets created by them during the ~~course of~~ticker ~~their~~symbol ~~employment are our property~~“ZDGE”.

7In March 2018, we completed the launch of Zedge Premium, a section of our marketplace where artists can launch a virtual store and market, distribute, and sell their digital content, including wallpapers, video wallpapers, ringtones, and notification sounds to our users.

WeIn January ~~have~~2019, ~~been~~we ~~granted~~started ~~trademark~~offering ~~protection~~freemium ~~for “~~Zedge” inApp ~~the~~Android ~~United~~users ~~States,~~the ~~European~~ability ~~Union,~~to ~~United~~convert ~~Kingdom,~~into ~~India,~~paying ~~and~~subscribers ~~Canada,~~in ~~“We~~exchange ~~Make~~for ~~Phones Personal,” and “Zedge,~~removing ~~Everything~~unsolicited ~~You,”~~advertisements ~~“Tattoo~~from ~~Your~~our ~~Phone,”~~Zedge ~~“Shortz~~App. –In ~~Chat~~April ~~Stories By Zedge~~2023,” ~~and~~we ~~“NFTs~~introduced ~~Made Easy” in United States and~~ a ~~stylized~~subscription ~~“D”~~tier ~~logo~~ in the ~~European~~iOS ~~Union,~~version ~~United~~of ~~Kingdom,~~ the ~~United~~ ~~States, and Canada~~app. WeAs ~~also have~~of ~~applied~~July ~~for trademark protection for “pAInt~~31,” ~~and “Zedge pAInt” in the United States~~2025, awe ~~stylized~~had ~~“D” logo~~approximately ~~in India~~984,000 ~~and~~active ~~have obtained a copyright registration for our flagship app~~subscribers, ~~Zedge.~~including Inapproximately ~~addition~~693,000 welifetime ~~have registered, amongst others, the following domain names: www~~subscriptions.~~zedge.net and www.zedge.com.~~

On In August 1, 2021, we acquired Emojipedia~~. As part of this acquisition~~, wethe ~~acquired~~world’s ~~trademark~~leading ~~registrations~~authority ~~for~~dedicated ~~“Emojipedia”~~to inproviding ~~the~~up-to-date ~~United~~and ~~States,~~well-researched ~~the European Union, the~~emoji ~~United Kingdom~~definitions, ~~and Australia~~information, and ~~trademark~~news ~~registrations~~as ~~for~~well “as World Emoji Day” ~~in the United States~~ and the ~~United~~annual ~~Kingdom. We~~World ~~also~~Emoji ~~acquired the following domain name registrations: www~~Awards.~~emojipedia.com and www.emojipedia.org.~~

On In April ~~12,~~ 2022, we acquired GuruShots, ~~Ltd.~~a Asrecognized ~~part~~category ofleader ~~this~~that ~~acquisition, we~~fuses ~~acquired~~photography ~~all~~with ~~intellectual~~mobile ~~property~~gaming. ~~rights~~GuruShots, ~~associated~~headquartered ~~with~~in Israel, ~~and~~offers ~~encompassed~~a ~~within~~platform ~~the~~spanning ~~GuruShots~~iOS, ~~mobile~~Android, and the web~~-based~~ ~~applications~~that gamifies photography by providing a fun, educational, and structured ~~including~~way ~~the~~for ~~following~~amateur ~~domain~~photographers ~~name:~~– ~~GuruShots.com.~~essentially Inanyone ~~addition,~~with wea ~~have~~mobile ~~obtained~~phone ~~trademark~~– ~~registrations~~to ~~for~~compete ~~“GuruShots”~~ in ~~the~~a ~~United~~wide ~~States~~variety of contests showcasing their photos while gaining recognition with votes, ~~applied~~badges, ~~for~~and ~~trademark~~awards. ~~protection~~On ~~for~~a “monthly basis, GuruShots users currently cast more than 3 billion “perceived votes” in ~~Canada,~~more ~~India,~~than ~~the~~300 ~~European~~competitions. ~~Union~~GuruShots ~~and~~currently ~~the~~generates ~~United~~revenue from selling digital resources ~~Kingdom~~that, ~~and~~if ~~have~~used ~~obtained~~skillfully, ~~copyright~~can ~~registrations~~provide ~~for~~additional ~~the~~visibility ~~GuruShots~~to ~~mobile~~competitors’ ~~and~~photographs, ~~web-based~~a ~~applications~~critical factor in securing votes for competitive ranking.

~~Human~~In December ~~Capital~~2022, we introduced ‘pAInt’ our generative AI creation suite within the Zedge App. pAInt enables users with the ability to create high quality AI images and audio by typing a brief description of what they are interested in or by uploading visual content that they want to tune with AI.

~~Our~~In early ~~headcount~~2025, ~~totaled~~Zedge 99implemented ascost ofcutting ~~July~~initiatives 31to enhance profitability and support long-term growth. Overall, ~~2024~~the estimated total savings from the global restructuring and other cost reduction initiatives were expected to range from $3.9 million to $4.1 million annually. In total, our global workforce was reduced by 22% and annualized compensation-related cost savings were projected to be in the vicinity of $2.6 million.

~~Facilities~~Our Technology

WeOur ecosystem dois ~~not~~powered ~~maintain~~by ~~office~~a ~~space~~scalable, indistributed ~~the~~platform ~~United~~that ~~States~~integrates inboth ~~light~~open-source ofand ~~having a~~proprietary ~~small domestic team~~technologies. WeIt ~~address~~spans ~~certain~~key domains ~~aspects~~such ofas ~~our~~content ~~commercial operations~~management, ~~including~~content ~~accounting and finance~~discovery, web and ~~business~~mobile ~~development from~~application ~~the New York area. We maintain leased facilities in Trondheim~~development, ~~Norway~~data science and ~~Vilnius~~analytics, ~~Lithuania~~device ~~that accommodate our product~~compatibility, ~~design,~~ ~~monetization,~~advertising ~~marketing~~ and ~~technology~~marketing ~~teams~~technology, and ~~in Tel Aviv, Israel that accommodates members of both the GuruShots and Zedge teams~~reporting. ~~Our servers are hosted in leased data centers in different geographic locations in the United States.~~

~~Item~~We have 1Abuilt a robust infrastructure that enables continuous ideation, experimentation, and deployment. ~~Risk~~This ~~Factors~~environment allows our development teams to quickly test hypotheses, analyze outcomes, and operationalize successful innovations.

~~Our~~Generative AI ~~business,~~and ~~operating~~large ~~results~~language ormodels ~~financial condition~~(LLMs) ~~could~~are beembedded ~~materially~~throughout ~~adversely~~our ~~affected~~technology bystack, ~~any~~powering a wide range of ~~the~~workflows—from ~~following~~automating content ~~risks~~creation ~~associated~~and ~~with~~enrichment ~~any~~to ~~one~~facilitating ofcontent ~~our~~translation. ~~businesses~~For example, asgenerative ~~well~~models asassist ~~the~~users in creating wallpapers, ringtones, and other ~~risks~~digital ~~highlighted~~assets ~~elsewhere~~by ingenerating ~~this~~imagery ~~document,~~and ~~particularly~~audio ~~the~~based ~~discussions~~on ~~about~~user ~~competition~~input and LLM-generated suggestions. ~~The~~Meanwhile, ~~trading~~LLM-driven systems ~~price~~enhance ofcontent ~~our~~translation ~~Class~~for Ba ~~common stock~~broader ~~could~~global ~~decline~~audience ~~due~~and torefine ~~any~~search ofand ~~these~~discovery ~~risks.~~algorithms for real-time, relevant content delivery.

~~Risk~~Our data ~~Factor~~pipelines ~~Summary~~continuously train and fine-tune machine learning models using user engagement signals. These insights feed into recommender systems and ranking algorithms, optimizing for both user satisfaction and content diversity.

~~Our business operations~~Operationally, ~~are~~LLM ~~subject~~tools toassist ~~numerous~~developers ~~risks~~ and ~~uncertainties,~~data ~~including~~scientists ~~those~~by ~~outside~~automating oftasks ~~our~~such ~~control,~~as ~~that~~code ~~could~~refactoring ~~cause~~and ~~our~~documentation ~~business~~generation, ~~financial condition~~improving orproductivity ~~operating~~and ~~results~~reducing toturnaround ~~be harmed, including, but not limited to, risks regarding the following:~~time.

● We offer a suite of freemium apps and we may not be successful in adding new users or in retaining existing users, or if our users decrease their level of engagement with our products or do not make optional purchases of tokens, resources, or content, or convert into paying subscribers and renew their paid subscriptions our revenue, financial results and business may be significantly harmed.7

●From an Weend ~~may~~user’s ~~not~~perspective, beour ~~successful~~platform inminimizes ~~acquiring~~response alatency ~~sufficient~~and ~~number~~optimizes ofresource ~~users~~allocation ~~that~~while ~~become~~maintaining ~~purchasers~~cost orefficiency. Distributed ~~retain~~systems, ~~existing~~caching ~~users~~strategies, ~~who~~and ~~generate~~inference ~~profitable~~optimization ~~revenue~~techniques ensure fast content rendering and real-time recommendations. At GuruShots, our unique technology stack combines open-source and proprietary systems to power a highly-engaging gamified photography platform. Our advanced ranking algorithms ensure fair exposure for participants, while our ~~apps~~real-time voting and ranking engine scales seamlessly to support millions of concurrent interactions. Our AI-driven recommendation system curates personalized competition suggestions based on users’ photographic style and historical engagement.

8To sustain vibrant participation across all competitions, AI bots intelligently maintain gameplay liquidity, ensuring active, competitive, and socially engaging challenges. All of this operates on a fully redundant, cloud-hosted infrastructure designed for high availability, scalability, and performance.

● We may not manage our in-app economy well and as a result, disincentivize users from making in-app purchases. Any failure to do so could adversely affect our business, financial condition, and results of operations.Intellectual Property

●Our trademarks, Ifcopyrights, wedomain names, proprietary technology, know-how, and other intellectual property are ~~unable~~vital to ~~compete~~our ~~for~~success. ~~advertisers~~We seek orto ifprotect ~~advertisers~~our ~~reduce~~intellectual ~~their~~property ~~spend~~rights ~~with~~by usrelying on federal, ~~our~~state, ~~revenues~~and common law rights in the United States and other countries, as ~~profitability~~well as contractual restrictions. We enter into confidentiality and ~~prospects~~nondisclosure ~~may~~agreements bewith ~~materially~~our employees and ~~adversely~~business ~~affected~~partners. The agreements we enter into with our employees also provide that all software, inventions, developments, works of authorship, and trade secrets created by them during the course of their employment are our property.

●We have ~~The~~been ~~digital~~granted ~~advertising~~trademark ~~market~~protection ~~may~~for ~~deteriorate~~“Zedge” orin ~~develop~~the ~~more~~United ~~slowly~~States, ~~than~~European ~~expected~~Union, ~~which~~United ~~could~~Kingdom, ~~materially~~India, ~~harm~~and ~~our~~Canada, “We ~~business~~Make Phones Personal,” “Zedge, Everything You,” “Tattoo Your Phone,” “Shortz – Chat Stories By Zedge,” and ~~results~~“NFTs ofMade ~~operations~~Easy” in United States and a stylized “D” logo in the European Union, United Kingdom, the United States, and Canada. We also have applied for trademark protection for “pAInt,” and “Zedge pAInt” in the United States, a stylized “D” logo in India, and have obtained a copyright registration for our flagship app, Zedge. In addition, we have registered, amongst others, the following domain names: www.zedge.net and www.zedge.com.

●On August A1, ~~material~~2021, ~~amount~~we acquired Emojipedia. As part of ~~our~~this ~~revenue~~acquisition, iswe ~~generated~~acquired ~~from~~trademark aregistrations ~~limited~~for ~~number~~“Emojipedia” in ofthe ~~geographies~~United ~~and~~States, ~~third-party~~the ~~advertising~~European ~~demand~~Union, ~~partners.~~the ~~Any~~United ~~change~~Kingdom, toand ~~this~~Australia, ~~mix~~and ~~could~~trademark ~~result~~registrations infor ~~negatively~~“World ~~impacting~~Emoji ~~our~~Day” in ~~business,~~the ~~financial~~United ~~condition,~~States and ~~results~~the ofUnited ~~operations~~Kingdom. We also acquired the following domain name registrations: www.emojipedia.com and www.emojipedia.org.

●On April ~~Our~~12, ~~apps’~~2022, ~~user~~we ~~base~~acquired isGuruShots ~~heavily~~Ltd. ~~weighted~~As topart ~~the~~of ~~Android~~this ~~operating~~acquisition, ~~system~~we acquired all intellectual property rights associated with, and ~~our~~encompassed ~~revenues~~within the GuruShots mobile and ~~profitability~~web-based ~~may~~applications, ~~suffer~~including ifthe following domain name: GuruShots.com. In addition, we have obtained trademark registrations for “GuruShots” in the ~~market~~United ~~demand~~States, Canada, European Union, and United Kingdom applied for ~~Android~~trademark ~~smartphones~~protection ~~decreases~~for “GuruShots” in India, and have obtained copyright registrations for the GuruShots mobile and web-based applications.

●Human Capital We rely on third-party platforms, such as the iOS App Store, Meta, and Google Play Store, to distribute our apps and collect revenues generated on these platforms. If these platforms adopt policies including those relating to advertising, privacy, or monetization that are counter to our strategy it could result in materially and adversely affecting our business.

●Attracting and ~~Zedge~~retaining ~~Premium,~~qualified ~~the~~personnel ~~section~~familiar ofwith our ~~marketplace~~businesses ~~where~~who wehead ~~offer~~our ~~premium~~different ~~content~~businesses ~~(i.e.,~~units ~~for~~is ~~purchase),~~critical ~~may~~to ~~not~~our ~~yield~~success. ~~the~~Our headcount ~~strategic~~totaled ~~goals~~82 ~~and~~as ~~objectives~~of ~~that~~July ~~we envision~~31, ~~and our revenues, profitability and prospects may be materially and adversely negatively affected~~2025.

●Our human Ifcapital weresources ~~fail~~objectives toinclude, ~~maintain~~as applicable, identifying, recruiting, retaining, incentivizing and ~~enhance~~integrating our ~~various~~existing and ~~brands~~new employees, oradvisors ifand weconsultants. ~~incur~~To ~~excessive~~accomplish ~~expenses~~that, inour ~~this~~compensation ~~effort~~practices are designed to attract and retain qualified and motivated personnel and align their interests with the goals of the Company and with the best interests of our stockholders. Our compensation philosophy is to provide compensation to attract the individuals necessary for our current needs and growth initiatives, and provide them with the proper incentives to motivate those individuals to achieve our ~~business~~long-term plans, ~~results~~which ofincludes ~~operations~~among other things, equity and ~~prospects~~cash ~~may~~incentive beplans ~~materially~~that attract, retain and ~~adversely~~reward ~~affected~~personnel through the granting of stock-based and cash-based compensation awards.

● We believe ~~may~~that ~~not~~talent beattraction ~~able~~and toretention ~~effectively~~are ~~manage~~critical to our ~~growth~~ability orto ~~implement~~achieve our ~~future~~strategy ~~business~~and ~~strategies~~that a trained, indiverse ~~which~~and ~~case~~inspired workforce is integral to delivering on our ~~business~~objectives. ~~and~~Our ~~results~~recruiting process reaches a wide array of ~~operations~~potential ~~may~~employees, beand ~~materially~~we employ a rigorous screening process to ensure that we identify and ~~adversely~~hire ~~affected~~quality professionals. We work to ensure that compensation and benefits offered to employees are fair and reflects industry standards and best practices.

● If we fail to keep up with rapid technological changes in the internet and smartphone industries and adapt our products and services accordingly, our results of operations and future growth may be adversely affected.8

● We are ~~have~~committed ~~offices~~to diversity and ~~other~~inclusion ~~significant~~in ~~operations~~the ~~located~~workforce inincluding ~~Lithuania,~~a ~~Israel,~~policy of non-discriminatory treatment and ~~Norway,~~respect of human rights for all current and prospective employees. Discrimination on the basis of an individual’s race, ~~therefore~~religion, ~~our~~creed, ~~results~~color, ~~may~~sex, besexual orientation, ~~adversely~~age, ~~affected~~marital bystatus, ~~political~~disability, ~~economic~~national origin or veteran’s status is not permitted by us and ~~military~~is ~~instability~~illegal in ~~these~~many jurisdictions. ~~countries~~We respect the human rights of all employees and strive to treat them with dignity consistent with standards and practices recognized by the international community.

● A key component of our growth strategy involves the adoption and utilization of artificial intelligence (AI), which introduces certain risks. ● Failure to detect or prevent fraudulent activities on our platform could cause users to lose confidence in our products and harm our business. ● The GuruShots acquisition may fail to yield growth opportunities and achieve beneficial synergies.Facilities

●We do ~~Data~~not ~~privacy~~maintain ~~and~~office ~~security~~space ~~laws and regulations~~ in the ~~jurisdictions~~United States in ~~which~~light weof dohaving ~~business~~a ~~subject~~small usdomestic toteam. ~~possible~~We ~~sanctions,~~address ~~civil~~certain ~~lawsuits~~aspects ~~(including~~of ~~class~~our ~~action~~commercial operations, orincluding ~~similar~~accounting ~~representative~~and ~~lawsuits)~~finance, and ~~other~~business ~~penalties~~development infrom the ~~event~~New ofYork ~~non-compliance,~~area. ~~additionally~~We ~~the~~maintain ~~need~~leased tofacilities ~~observe~~in ~~these~~Vilnius, Lithuania ~~regulations~~and ~~increases~~Tel ~~the~~Aviv, ~~cost~~Israel for members of ~~doing~~both ~~business~~GuruShots and ~~these~~Zedge ~~laws~~teams and ~~regulations~~that ~~are~~make ~~continually~~up ~~evolving.~~our ~~Compliance~~product, ~~failure~~design, ~~either~~monetization, bymarketing and ustechnology orteams. ~~our~~We ~~partners~~lease space in Trondheim, orNorway ~~vendors~~that ~~could~~formerly ~~harm~~housed members of our ~~business~~team and we are exploring alternatives for that space in light of the recent restructuring and shut down of that office.

●A ~~New~~certain ~~laws~~number ~~may~~of ~~impact~~ our ~~business,~~servers ~~such~~are ashosted ~~those~~in ~~affecting~~leased ~~artificial~~data ~~intelligence~~centers ~~and~~in different ~~efforts~~geographic bylocations ~~lawmakers~~ in ~~various~~the ~~jurisdictions~~United toStates. ~~regulate~~We ~~providers~~utilize ofcloud-based ~~certain~~resources ~~online~~for ~~services~~a ~~which~~significant ~~may~~portion ~~apply~~of to our ~~business~~needs and ~~therefore~~those services ~~introduce~~are ~~additional~~hosted ~~compliance~~at ~~obligations and potential sanctions and penalties for failings in these areas. Monitoring (and, if applicable, complying with) these developments is likely to increase~~ the ~~cost~~providers’ ~~of doing business and any failure to comply with new laws may harm our business and reputation~~facilities.

9Item 1A. Risk Factors

● Our business, ~~depends~~operating onresults ~~our~~or ~~ability~~financial tocondition ~~collect~~could ~~and~~be ~~effectively~~materially ~~use~~adversely ~~data~~affected toby ~~serve~~any ~~relevant~~of ~~advertising,~~the ~~deliver~~following ~~suitable~~risks ~~content,~~associated ~~and~~with any ~~identify~~one ~~appropriate~~of ~~customer~~our ~~prospects~~businesses, ~~and~~as ~~any~~well ~~limitation~~as on the ~~collection~~other ~~and~~risks ~~use~~highlighted ofelsewhere in this ~~data~~document, ~~could~~particularly ~~significantly diminish~~ the ~~value~~discussions ofabout ~~our~~competition. The ~~services,~~trading ~~cause~~price usof toour ~~lose~~Class ~~clients,~~B ~~make~~common usstock ~~less~~could ~~attractive~~decline due to ~~prospective~~any ~~customers~~of ~~and~~these ~~revenues~~risks.

●Risk Factor ~~Any significant system or network disruption or cyberattack could have a material adverse effect on our business prospects and results of operations.~~Summary

●Our business Weoperations are ~~controlled~~subject byto numerous risks and uncertainties, including those outside of our ~~majority~~control, ~~stockholder~~that could cause our business, financial ~~which~~condition ~~limits~~or ~~the~~operating ~~ability~~results ofto ~~other~~be ~~stockholders~~harmed, including, but not limited to, ~~affect~~risks ~~our~~regarding ~~management.~~the following:

~~RISKS~~● ~~RELATED~~If TOwe ~~OUR~~fail ~~BUSINESS~~to ~~AND~~keep ~~INDUSTRY~~up with rapid technological changes in the internet, smartphone industries, and AI, and adapt our products and services accordingly, our results of operations and future growth may be adversely affected.

~~Certain~~● A key component of our ~~offerings~~growth ~~are~~strategy ~~sensitive~~involves tothe ~~consumer spending~~adoption, integration, and ~~economic~~effective ~~conditions~~utilization of AI technologies across our products, services, and internal operations, which introduces significant and evolving risks. ● We offer a suite of freemium apps and we may not be successful in adding new users or in retaining existing users, or if our users decrease their level of engagement with our products or do not make optional purchases of tokens, resources, or content, or convert into paying subscribers and renew their paid subscriptions our revenue, financial results and business may be significantly harmed.

~~Consumer~~● ~~purchases~~We ofmay ~~discretionary~~not ~~retail~~be ~~items and~~successful ~~specialty retail products, as well as participation~~ in ~~gallery~~acquiring ~~events,~~a ~~may~~sufficient benumber ~~adversely affected by national and regional economic, market and other conditions such as employment levels, salary and wage levels, the availability~~ of ~~consumer~~users ~~credit,~~that ~~inflation,~~become ~~high~~purchasers ~~interest rates, high tax rates, high fuel prices, the threat of a pandemic~~ or ~~other~~retain ~~health~~existing ~~crisis~~users ~~and~~who ~~consumer~~generate ~~confidence~~profitable ~~with~~revenue ~~respect~~for to current and future economic, market and other conditions. Consumer purchases may decline during recessionary periods or at other times when unemployment is higher or disposable income is lower. Consumer willingness to make discretionary purchases may decline, may stall or may be slow to increase due to national and regional economic conditions. There remains considerable uncertainty and volatility in the national and global economy. Further or future slowdowns or disruptions in the economy, market and other conditions could adversely affect us and our ~~business strategy~~apps. ~~We may not be able to sustain or increase our current net sales if there is a decline in consumer spending.~~

● We ~~offer a suite of freemium apps and we~~ may not bemanage ~~successful~~our in-app ~~adding~~economy ~~new~~well ~~users~~and oras ina ~~retaining existing users~~result, ordisincentivize ~~if our~~ users ~~decrease~~from ~~their~~making ~~level~~in-app ofpurchases. ~~engagement~~Any ~~with~~failure ~~our~~to ~~products or~~ do ~~not~~so ~~make~~could ~~optional~~adversely ~~purchases~~affect ofour ~~tokens~~business, ~~coins,~~financial ~~resources~~condition, ~~or content, or convert into paying subscribers~~ and ~~renew their paid subscriptions our revenue, financial~~ results ~~and~~of ~~business may be significantly harmed~~operations.

~~The~~● ~~size~~If ofwe ~~our user base and our users’ level of engagement and paid conversion~~ are ~~fundamental~~unable to ~~our~~compete ~~success.~~for ~~Our~~advertisers ~~financial~~or ~~performance~~if ~~has~~advertisers ~~been~~reduce ~~and~~their ~~will~~spend ~~continue~~with ~~to be dependent on our ability to successfully add new users~~us, ~~retain and engage existing users and convert them into paying users and/or subscribers. We expect that the size of~~ our ~~user base will fluctuate or decline in one or more markets from time to time. If consumers and/or creators do not perceive our products as useful~~revenues, ~~effective,~~profitability ~~entertaining, reliable,~~ and~~/or~~ ~~trustworthy,~~prospects we may ~~not~~ be ~~able~~materially ~~to attract or keep users or otherwise maintain or increase the frequency~~ and ~~duration~~adversely ~~of their engagement or the percentage of users that are converted into or remain paying subscribers~~affected. There is no guarantee that we will not experience a decline in our user base or engagement levels. User engagement can be difficult to measure, particularly as we introduce new and different products and services, and as various privacy regulations evolve. Any number of factors can negatively affect user retention, growth, engagement and conversion, including if:

~~● users opt to utilize other competitive products or services instead of our own;~~9

● ~~user~~The ~~behavior~~digital ~~changes~~advertising ~~with~~market ~~respect~~may todeteriorate ~~our~~or ~~products~~develop ~~and~~more ~~services~~slowly ~~resulting~~than inexpected, awhich ~~decrease~~could ofmaterially ~~engagement~~harm our business and~~/or~~ ~~session~~results ~~time;~~of operations.

● ~~users~~A ~~decrease~~material ~~their~~amount ~~engagement,~~of ~~session~~our ~~time,~~revenue oris ~~uninstall~~generated ~~our~~from ~~apps~~a ~~because~~limited ~~they~~number ~~feel~~of ~~their~~geographies ~~experience~~and isthird-party ~~diminished~~advertising ~~due~~demand topartners. ~~product~~Any ~~decisions~~change ~~that~~to wethis ~~make~~mix ~~with~~could ~~respect~~result toin ~~introducing~~negatively ~~new~~impacting ~~features~~our business, ~~feature~~financial ~~enhancements~~condition, ~~an/or~~and ~~monetization~~results ~~techniques;~~of operations.

● ~~users~~Our ~~become~~apps’ ~~concerned~~user ~~about~~base ~~our~~is ~~user~~heavily ~~data~~weighted ~~practices~~to orthe ~~other~~Android ~~matters~~operating ~~related~~system toand ~~privacy,~~our ~~security~~revenues and profitability may suffer if the ~~sharing~~market ofdemand ~~user~~for ~~data;~~Android smartphones decreases.

10● We rely on third-party platforms, primarily the iOS App Store, Meta, and Google Play Store, to distribute our apps, process payments, and collect revenues generated on these platforms. These platforms exercise significant control over app distribution, monetization, advertising, and privacy policies, and frequently update their algorithms and terms of service. In addition, the integration of AI-driven content and search results by these platforms (e.g., Google’s “AI Overviews” and similar generative AI features from Apple and Meta) may reduce organic traffic to our properties by embedding content directly in platform experiences. If these platforms adopt policies — including those relating to AI integration, advertising, privacy, monetization, or content display — that are counter to our strategy, our business could be materially and adversely affected.

● ~~users~~Zedge ~~are~~Premium, nothe ~~longer~~section ~~willing~~of toour ~~pay~~marketplace ~~for~~where ~~subscriptions~~we oroffer ~~in-app~~premium ~~purchases~~content or(i.e., wefor ~~are~~purchase), ~~unable~~may tonot ~~increase~~yield the ~~price~~strategic ofgoals and objectives that we envision, and our ~~subscriptions~~revenues, orprofitability ~~in-app~~and ~~purchases;~~prospects may be materially and adversely negatively affected.

● ~~users~~We ~~have~~operate ~~difficulty~~in ~~installing~~a highly competitive industry with low barriers to entry, ~~updating~~and orour ~~otherwise~~failure ~~accessing~~to compete effectively, particularly with our ~~products~~AI-based offerings, could adversely affect our business and ~~services~~results asof operations. ● Our efforts to develop and expand our content licensing business exposes us to a ~~result~~number of risks that could limit our ~~actions~~ability orto ~~those~~grow, achieve commercial success, and maintain our overall, business, results of ~~third~~operations, ~~parties~~and ~~that~~financial wecondition. ~~rely~~Contributors onmay choose not to ~~distribute~~provide their content for licensing purposes, which could prevent us from scaling our ~~products~~licensing business. ● If we fail to maintain and ~~deliver~~enhance our ~~services;~~various brands, or if we incur excessive expenses in this effort, our business, results of operations and prospects may be materially and adversely affected.

● weWe ~~fail~~may not be able to ~~introduce~~effectively ~~new~~manage ~~features,~~our ~~products~~growth or ~~services~~implement ~~that~~our ~~users~~future ~~find~~business ~~engaging~~strategies, orin ~~enhance~~which ~~the~~case ~~existing~~our ~~products~~business and ~~services~~results ~~with~~of ~~improvements~~operations ~~that~~may ~~users~~be ~~are~~materially ~~interested~~and ~~in;~~adversely affected.

● weWe ~~are~~have ~~unable~~offices toand ~~acquire~~other ~~users~~significant ~~through~~operations ~~cost-effective~~located ~~marketing~~in ~~efforts~~Lithuania, ~~including~~and ~~both~~Israel, ~~organic~~and, therefore, our results may be adversely affected by political, economic and ~~paid~~military ~~channels;~~instability in these countries.

● Data privacy, security, and emerging AI laws and regulations in the jurisdictions in which we ~~are~~operate ~~unable~~subject ~~attract~~us ~~sufficient~~to ~~new~~possible ~~paying~~sanctions, ~~users~~civil lawsuits (including class action or similar representative lawsuits) and other penalties in the event of non-compliance. The need to ~~offset~~observe these evolving requirements increases the cost of doing business and ~~exceed~~may ~~those~~impose ~~lost~~operational ~~through~~burdens ~~natural~~that ~~churn~~could ~~thus~~adversely ~~making~~affect itour ~~more~~products, ~~difficult~~user toexperience, ~~maintain~~and competitiveness. Compliance failures by us, our partners, or our vendors could harm our business, reputation, and ~~grow~~financial ~~revenues;~~results.

● ~~initiatives~~New ~~designed~~laws may impact our business, such as those affecting artificial intelligence and efforts by lawmakers in various jurisdictions to ~~attract~~regulate providers of certain online services which may apply to our business and ~~maintain~~therefore ~~users~~introduce additional compliance obligations and ~~increase~~potential ~~engagement~~sanctions ~~are~~and ~~unsuccessful~~penalties ~~because~~for offailings ~~errors~~in ~~that~~these weareas. ~~make~~Monitoring or(and, ~~policies~~if ~~instituted~~applicable, bycomplying ~~third~~with) ~~parties~~these ~~that~~developments weis ~~use~~likely to ~~distribute~~increase ~~our~~the ~~products~~cost orof ~~deliver~~doing business and any failure to comply with new laws may harm our ~~services;~~business and reputation.

~~● third-party initiatives that may enable greater use of our products, including low-cost or discounted data plans, are discontinued;~~10

● weOur ~~adopt~~business ~~terms,~~depends ~~policies~~on orour ~~procedures~~ability ~~related~~ to ~~areas~~collect ~~such~~and aseffectively ~~privacy,~~use ~~user~~ data to serve relevant advertising, deliver suitable content, ~~ownership~~and identify appropriate customer prospects, orand ~~monetization~~any ~~techniques~~limitation ~~that~~on ~~are~~the ~~received~~collection ~~negatively~~and byuse of this data could significantly diminish the value of our ~~users~~services, orcause ~~creators;~~us to lose clients, make us less attractive to prospective customers and revenues.

● weAny ~~fail~~significant tosystem ~~combat~~or ~~inappropriate~~network disruption or ~~abusive~~cyberattack ~~activity~~could have a material adverse effect on our ~~platforms;~~business prospects and results of operations.

● weWe are ~~unable~~controlled toby ~~offer~~our ~~relevant~~majority ~~content~~stockholder, which limits the ability of other stockholders to affect our ~~users;~~management.

●RISKS RELATED weTO ~~fail~~OUR toBUSINESS ~~provide~~AND ~~adequate support for our users and creators;~~INDUSTRY

●If we ~~there~~fail ~~are~~to ~~outages~~keep orup ~~other~~with ~~technical~~rapid ~~problems~~technological ~~that~~changes ~~result~~ in ~~making~~the internet, smartphone industries, and artificial intelligence (“AI”), and adapt our products and services ~~inaccessible~~accordingly, ~~unreliable~~our orresults ~~that~~of ~~result~~operations inand afuture ~~poor~~growth ~~user~~may ~~experience;~~be adversely affected.

●The internet ~~there~~and smartphone industries are ~~actions~~characterized by ~~governments~~rapid ~~that~~and ~~affect~~innovative ~~accessibility~~technological changes. Our future success will depend, in part, on our ability to respond to fast changing technologies, adapt our products and services, including those of Emojipedia, to evolving industry standards and improve the performance, functionality and reliability of our products and services. For example, AI platforms, including ChatGPT and Claude, now return emoji results in ~~any~~response to user queries. While it is too early to accurately quantify the impact of these changes on Emojipedia’s monthly active users (MAU), we believe they are likely to result in reduced traffic and adversely affect revenue. Our increasing reliance on AI technologies for various operational aspects, such as content moderation, personalization, and user engagement, may pose risks if these systems fail or produce unintended outcomes. Technical issues, data inaccuracies, or system malfunctions could disrupt our services and negatively impact user experience. Ensuring the reliability and accuracy of AI systems requires ongoing maintenance, testing, and potential human oversight, which may increase operational complexity and costs. Our failure to continue to adapt to such changes could harm our business. If we are slow to develop products and services that are compatible with smartphones, or if the products and services we develop are not widely accepted and used by smartphone users, we may not be able to capture a significant share of this important market;. In addition, the widespread adoption of new internet, networking or telecommunications technologies or other technological changes for smartphones could require substantial expenditures to modify or adapt our products, services or infrastructure. If we fail to keep up with rapid and innovative technological changes to remain competitive, our future growth may be materially and adversely affected and our results of operations could be materially and adversely affected.

●A key ~~there~~component ~~are~~of ~~regulations~~our ~~and/or~~growth ~~litigation~~strategy ~~that~~involves ~~result~~the inadoption, ~~users~~integration, ~~not~~and ~~accepting~~effective ~~our~~utilization ~~terms~~ of ~~use~~AI ~~because~~technologies ofacross ~~measures~~our ~~that~~products, services, weand ~~have~~internal ~~taken~~operations, inwhich ~~order~~introduces tosignificant ~~ensure~~and ~~compliance~~evolving risks.

~~Certain~~We currently ofincorporate ~~these~~AI ~~factors~~into ~~have~~certain existing and planned products, atas ~~various~~well ~~times~~as our internal operations. For example, in fiscal 2023 ~~negatively~~we ~~impacted~~launched ~~user~~pAInt, a generative AI creation suite within the Zedge App. We also rely on AI tooling, automation platforms, and ~~creator~~emerging practices ~~growth~~such as “vibe coding” to improve operational efficiency, ~~MAU~~enhance content creation workflows, and ~~engagement~~accelerate product development. IfDeveloping, wetesting, ~~are~~and ~~unable~~deploying tothese ~~maintain~~AI orsystems, particularly those leveraging third-party services, may increase our cost ~~user~~profile ~~base~~due ~~and~~to ~~user~~high ~~engagement~~computing costs, which could reduce our ~~revenue~~margins and adversely affect our financial results. ~~may~~Achieving beconsistent, secure, ~~materially~~and ~~adversely~~compliant ~~affected~~AI adoption across departments—including Product & Engineering, Content Operations, Trust & Safety, Customer Support, Finance, and Legal/Compliance—requires ongoing investment in training, governance, and change management. Failure by any function to adopt or appropriately use these tools could reduce productivity, impair product quality, or cause compliance or security issues.

WeAI technologies are complex, resource-intensive, and rapidly evolving. Market demand and acceptance of AI-driven offerings, such as pAInt and Zedge Premium, remain uncertain, and our product development efforts may not ~~experience~~achieve ~~growth~~widespread adoption or ~~engagement~~may be outpaced by competitors. Competitors with greater financial, technical, data, or distribution resources may gain an advantage in ~~certain~~attracting ~~geographic~~and ~~locations~~retaining AI talent and in acquiring training data and compute capacity, which could impair our ability to maintain competitive AI capabilities. If our AI solutions, or those of others in our industry, draw controversy due to ~~local~~their ~~factors~~perceived or actual societal impact—such as generating biased, harmful, or misleading content—we may experience brand or reputational harm, competitive harm, or legal liability, which could slow user adoption of our products.

WeThe use ~~may~~of ~~not~~AI ~~experience~~also ~~rapid~~raises ~~user~~ethical, ~~growth~~reputational, and legal concerns. AI systems can generate or ~~continued~~amplify ~~engagement~~content inthat is inaccurate, misleading, ~~countries~~biased, ~~that~~discriminatory, ~~have~~harmful, ~~unreliable~~or ~~telecommunications~~otherwise ~~infrastructure~~controversial, or inbe ~~countries~~misused ~~where~~by ~~mobile~~third ~~and~~parties. ~~internet~~If ~~usage~~our AI tools produce, or are ~~expensive~~perceived to produce, such outputs, or ~~limited~~if we fail to implement adequate human oversight, testing, and safeguards (including data governance, evaluation, inand ~~regular~~post-deployment ~~accessibility.~~monitoring), ~~Any~~our ~~decrease~~brand inand ~~user~~competitive ~~retention~~standing could be harmed and we could face complaints, ~~growth~~investigations, or litigation. ~~engagement~~Potential litigation or government regulation related to AI may ~~have~~increase athe ~~material~~burden and ~~adverse~~cost ~~impact~~of onresearch ~~our~~and ~~popularity~~development, ~~revenue~~further subjecting us to reputational harm, ~~business~~competitive harm, ~~reputation~~or legal liability. Failure to address perceived or actual technical, ~~financial~~legal, compliance, ~~condition~~privacy, ~~and~~security, ~~results~~or ethical issues could undermine public confidence in AI, slowing customer adoption of ~~operations~~our AI-driven products and services, such as pAInt and Zedge Premium.

We are susceptible to platform and competitive risks arising from the rapid adoption and integration of AI by established technology platforms, app stores, search engines, and new market entrants. For example, platforms may ~~not~~incorporate beAI-driven ~~successful~~wallpaper, inemoji, ~~acquiring~~or aother ~~sufficient~~personalization ~~number~~features directly into their services or AI overviews, reduce referral traffic, alter algorithms or terms governing AI content, or restrict use of ~~users~~third-party ~~that~~AI ~~become~~tools, ~~purchasers~~any of which could decrease usage of our products or ~~retain~~increase ~~existing~~customer ~~users~~acquisition ~~who~~costs. ~~generate~~Over ~~profitable~~time, ~~revenue~~improvements in ~~for~~AI accuracy, efficiency, and capabilities could disrupt our ~~apps~~business model if we fail to anticipate and respond effectively.

~~Revenues of freemium apps~~ Laws and ~~websites~~regulations ~~typically rely~~focused on athe ~~small~~development, ~~percentage~~use, ofand ~~users~~provision ~~that~~of ~~convert~~AI ~~into~~technologies ~~paying~~and ~~users~~other ~~by making in-app purchases of~~ digital ~~goods~~products and~~/or~~ ~~paid~~services ~~subscriptions;~~are proliferating ~~however,~~in ~~the~~many ~~vast~~jurisdictions ~~majority~~around ofthe ~~users play for free or only occasionally make purchases or opt-in for paid subscriptions~~world. ~~Accordingly,~~Staying ~~only a~~compliant ~~small~~with ~~percentage~~evolving ~~of our users are paying users. In addition~~laws, ~~a small portion of paying users generate a disproportionate percentage of revenue. Because of this~~regulations, itand isindustry ~~imperative~~standards ~~for~~pertaining us to ~~both~~AI ~~retain~~may impose ~~these~~significant ~~valuable~~operational ~~customers~~costs and toconstrain ~~maintain~~our orability ~~increase~~to ~~their spend over time. In fiscal 2024~~develop, ~~we experienced an 8% decline in paid subscriptions. Conversely~~deploy, ~~over~~or ~~the~~employ ~~past~~AI ~~seven years, GuruShots has successfully increased the compounded annual growth rate of monthly spending per paying player by around 9~~technologies.~~9%.~~ ~~There~~Failing ~~can~~to beadapt ~~no assurance that we will~~appropriately ~~be able~~ to ~~continue~~this toevolving ~~retain~~regulatory ~~paying~~environment ~~users,~~could ~~grow~~result ~~or maintain subscription levels or that paying users will maintain or increase their spending. We may experience a net decline~~ in ~~paying~~legal ~~players~~liability, ~~resulting~~regulatory inactions, amonetary ~~decrease~~penalties inand ~~revenue~~damage ~~resulting~~to ~~in a materially adverse outcome for~~ our ~~business~~ brand and ~~financial results~~reputation.

WeOperationally, AI ~~may~~models ~~not~~depend ~~manage~~on ~~our~~the inquality, provenance, and security of data and on reliable third-~~app~~party ~~economy~~infrastructure. ~~well~~Inadequate, outdated, biased, or compromised datasets can produce flawed outputs and “model drift.” Our reliance on third-party models, APIs, datasets, asand acloud ~~result~~providers exposes us to outages, ~~disincentivize~~cost ~~users~~volatility, ~~from~~performance ~~making~~degradation, or changes in licensing or acceptable-~~app~~use ~~purchases~~terms, which could disrupt our operations if these services become unavailable or are no longer offered on commercially reasonable terms. ~~Any~~Integrating AI ~~failure~~introduces tonew docybersecurity sorisks, ~~could~~including ~~adversely~~prompt-injection, ~~affect~~data ~~our~~exfiltration, ~~business~~model poisoning, ~~financial~~and ~~condition~~supply-chain vulnerabilities, ~~and~~as ~~results~~well ofas ~~operations~~the risk that employees inadvertently input confidential or personal data into external systems.

~~Our~~Intellectual property ~~apps~~ownership ~~are~~surrounding ~~available~~AI totechnologies ~~players~~has ~~for~~not ~~free~~been ~~and each~~fully ~~brand~~addressed ~~generates~~by aU.S. ~~material~~courts ~~portion~~or offederal ~~its~~and ~~revenue~~state bylaws, ~~selling~~nor ~~digital~~by ~~goods~~international legal ~~and/or~~frameworks ~~paid subscriptions~~globally. ~~The~~Our ~~perceived~~ongoing ~~value~~development ofand ~~these digital~~use ~~goods~~of ~~and/or~~generative ~~paid~~AI ~~subscriptions~~tools ~~can~~may beresult ~~impacted~~in bycopyright ~~various~~infringement ~~factors including~~claims, ~~but~~disputes over ~~not~~ownership ~~limited~~and tolicensing, ~~their~~and ~~price,~~potential ~~discounting~~patent ~~policies, promotional~~infringement ~~strategies~~claims, ~~market~~among ~~competition,~~other ~~user~~things. ~~reviews,~~These ~~and~~legal ~~user~~challenges ~~engagement~~could ~~levels.~~be Ifcostly weto defend ~~fail~~against, leading to ~~manage~~substantial ~~our~~financial ~~economy~~obligations ~~well,~~and wereputational ~~risk~~damage. ~~confusing~~The evolving regulatory environment and uncertain orlegal ~~upsetting~~precedents ~~users~~in tothis ~~the~~field ~~point~~further ~~that~~increase ~~they~~our ~~reduce~~exposure ~~their~~to ~~purchases~~litigation risks, which could ~~negatively~~materially ~~hurt~~affect ~~the~~our business, financial condition, and results of operations.

IfAdditionally, laws weand regulations focused on the development and use of AI are ~~unable~~proliferating globally and continue to ~~compete~~evolve (for ~~advertisers~~example, comprehensive AI frameworks in the EU and emerging federal and state guidance in the U.S.). Compliance may require significant documentation, transparency and record-keeping, risk assessments, model governance, content provenance or ifwatermarking, ~~advertisers~~impact ~~reduce~~assessments, ~~their~~vendor ~~spend~~oversight, ~~with~~and restrictions uson certain use cases. Noncompliance could result in investigations, ~~our~~fines, ~~revenues~~injunctions, ~~profitability~~remediation obligations, or other sanctions. Cross-border data transfer rules, sanctions, and ~~prospects~~export controls may beaffect ~~materially~~access ~~and~~to ~~adversely~~datasets, ~~affected~~models, or compute resources in some jurisdictions.

~~In fiscal 2024~~Further, our ~~approximately~~use ~~79%~~ of ~~our~~generative ~~revenues (excluding~~AI ~~GuruShots)~~in ~~were~~aspects ~~generated~~of ~~from~~our ~~selling~~platforms ~~advertising~~may ~~inventory.~~present Werisks ~~generally~~and ~~enter~~challenges ~~into~~that ~~arrangements~~could ~~with~~increase ~~the~~as ~~major~~AI ~~programmatic advertising~~solutions ~~networks~~become ~~to monetize our advertising inventory~~more prevalent. WeAI ~~need~~algorithms tomay ~~maintain~~be ~~good relationships with these advertising networks to provide us with a sufficient inventory of advertisements~~flawed. ~~Online~~Datasets ~~advertising,~~may ~~including~~be ~~through~~insufficient ~~mobile~~or ~~applications,~~contain isbiased ~~an intensely competitive industry~~information. ~~Many~~These ~~large~~deficiencies ~~companies, such as Applovin, Meta~~ and ~~Google,~~other ~~invest significantly in data analytics to make their properties and~~failures ~~platforms more attractive to advertisers. Our advertising revenue is primarily a function~~ of ~~the~~AI ~~number~~systems ~~and~~could ~~hours~~have ofnegative ~~engagement~~impacts ofon our ~~free~~ users’ experience and ~~our~~subject ~~ability~~us to ~~provide~~competitive ~~innovative~~harm, ~~advertising~~regulatory ~~products that are relevant to our users~~action, ~~maintain or increase user engagement~~legal liability, and ~~satisfaction~~brand ~~with~~or ~~our~~reputational ~~products,~~harm. ~~and~~Contractual ~~enhance~~indemnities ~~returns~~from ~~and~~vendors ~~add~~may ~~incremental~~be ~~gains~~unavailable ~~for~~or ~~our advertising partners~~insufficient. IfWe ~~our~~may ~~relationship~~also ~~with~~face ~~any~~claims ~~advertising~~related ~~partners~~to ~~terminates~~privacy ~~for~~(including ~~any reason, or if~~ the ~~commercial~~processing ~~terms~~ of ~~our~~personal ~~relationships~~or ~~are~~biometric ~~changed~~information), orpublicity dorights, ~~not~~deceptive ~~continue~~practices, toor becontent ~~renewed~~moderation onfailures. ~~favorable~~Defending ~~terms,~~such orclaims ifcan webe ~~cannot~~costly ~~source~~and ~~high~~time-~~quality~~consuming, ~~ads~~could ~~consistent~~require ~~with~~changes to our ~~brand~~products or ~~product experience~~processes, ~~we would need~~ toand ~~qualify new advertising partners, which~~ could ~~negatively~~harm ~~impact~~ our ~~revenues,~~reputation atand ~~least~~financial ~~in the short term~~results.

~~In addition~~Finally, ~~internet~~ AI-~~connected~~related ~~devices~~development and ~~operating systems~~inference ~~controlled~~can byincrease ~~third~~energy ~~parties~~consumption ~~increasingly~~and ~~contain features that allow device users to disable functionality that allows for the delivery of advertising on their devices or reduce the ability to provide personalized or targeted advertising~~costs, ~~which results in less valuable ads. Device~~ and ~~browser~~investor ~~manufacturers may include~~ or ~~expand~~regulatory ~~these~~focus ~~features~~on assustainability ~~part~~may impose ofadditional ~~their standard device specifications~~constraints. ~~For example,~~If ~~when~~we ~~Apple~~fail ~~announced~~to ~~that~~implement ~~UDID,~~robust aAI ~~standard device identifier used in some applications~~governance, ~~was~~align ~~being~~employee ~~superseded~~practices ~~and~~with ~~would~~our ~~no longer be supported~~policies, ~~application~~maintain ~~developers were required to update their apps to utilize alternative device identifiers such as universally~~sufficient ~~unique~~human ~~identifier~~oversight, ~~or,~~and ~~more~~continuously ~~recently,~~evaluate ~~identifier-for-advertising, which simplifies the process for Apple users to opt out of behavioral targeting. Furthermore, laws~~ and ~~regulations~~improve ~~may also make it more difficult to deliver personalized or targeted advertising or impose requirements that result in more users making elections to block~~ our ~~ability~~systems, ~~to deliver targeted ads. If users do not elect to participate in functionality that supports~~ the ~~delivery~~risks ofdescribed ~~targeted~~above ~~advertising on their devices, our ability to deliver effective advertising campaigns~~ could ~~suffer,~~materially ~~which~~and ~~could~~adversely ~~cause~~affect our business, financial condition, ~~or operating~~ results toof beoperations, ~~adversely~~and ~~affected~~reputation.

We anticipate that our growth and profitability will continue to depend on our ability to sell our advertising inventory. Companies that advertise with us may choose to utilize other advertising channels or may reduce or eliminate their marketing altogether for a variety of reasons, many of which are out of our control, including, without limitation, if the demand for mobile phone personalization industry declines or otherwise falls out of favor with advertisers or consumers.12

IfWe offer ~~the~~a ~~size~~suite of ~~the~~freemium ~~digital~~apps ~~advertising~~and ~~market does~~we may not ~~increase~~be ~~from~~successful ~~current~~in ~~levels~~adding new users or in retaining existing users, or if our ~~digital~~users ~~brands~~decrease their ~~are~~level ~~unable~~of toengagement ~~capture~~with ~~and~~our ~~retain~~products aor ~~sufficient~~do ~~share~~not make optional purchases of ~~that~~tokens, ~~market~~coins, ~~our ability~~resources, toor ~~maintain~~content, or ~~increase~~convert ~~our~~into paying ~~current~~subscribers ~~level~~and ofrenew ~~advertising~~their ~~revenues~~paid ~~and~~subscriptions our ~~revenues~~revenue, ~~profitability~~financial results and ~~prospects~~business ~~could~~may be ~~materially and~~significantly ~~adversely affected~~harmed.

12The size of our user base and our users’ level of engagement and paid conversion are fundamental to our success. Our financial performance has been and will continue to be dependent on our ability to successfully add new users, retain and engage existing users and convert them into paying users and/or subscribers. We expect that the size of our user base will fluctuate or decline in one or more markets from time to time. If consumers and/or creators do not perceive our products as useful, effective, entertaining, reliable, and/or trustworthy, we may not be able to attract or keep users or otherwise maintain or increase the frequency and duration of their engagement or the percentage of users that are converted into or remain paying subscribers. We may continue to see declines in our user base or engagement levels, which could further erode our ability to maintain or grow revenue. User engagement can be difficult to measure, particularly as we introduce new and different products and services, and as various privacy regulations evolve. Any number of factors can negatively affect user retention, growth, engagement and conversion, including if:

~~The~~● ~~digital~~users ~~advertising~~opt ~~market~~to ~~may~~utilize ~~deteriorate, which~~other ~~could~~competitive ~~materially~~products ~~harm~~or ~~our~~services ~~business~~instead ~~and results~~ of ~~operations.~~our own;

We● ~~generate~~user ~~the~~behavior ~~substantial~~changes ~~majority~~with ofrespect ~~our~~to ~~revenue from selling advertising inventory. We anticipate that~~ our ~~growth~~products and ~~profitability~~services ~~will~~resulting ~~continue~~in toa ~~depend~~decrease ~~on our ability to sell advertising inventory across some if not all~~ of ~~our~~engagement ~~digital~~and/or ~~brands.~~session time;

~~Future~~● ~~demand~~users ~~for~~decrease ~~mobile~~their ~~advertising~~engagement, issession ~~uncertain. Many~~time, ~~advertisers~~or ~~still~~uninstall ~~have~~our ~~limited~~apps ~~experience~~because ~~with~~they ~~mobile~~feel ~~advertising~~their ~~and~~experience ~~may~~is ~~continue~~diminished due to ~~devote~~product ~~larger~~decisions ~~portions~~that ofwe ~~their~~make ~~advertising budgets~~with respect to ~~more~~introducing ~~traditional~~new ~~offline~~features, orfeature ~~online personal computer-based advertising~~enhancements, ~~instead~~and/or ofmonetization ~~shifting additional advertising resources to mobile advertising.~~techniques;

~~Further,~~● ~~our~~users ~~advertisers’~~become ~~ability~~concerned toabout ~~effectively target their advertising to~~ our user’s ~~interests~~data ~~may~~practices beor ~~negatively~~other ~~impacted~~matters byrelated ~~the degree~~ to ~~which our~~ privacy ~~control measures that we have implemented or may implement in the future in connection with regulations~~, ~~regulatory~~security ~~actions, the user experience, or otherwise,~~ and ~~our advertising revenue may decrease or otherwise be curtailed as a result. Changes to operating systems’ practices and policies, such as Apple’s deprecating~~ the ~~Identifier~~sharing for Advertisers (“IDFA”) and Google’s Privacy Sandbox which is meant to make current tracking mechanisms obsolete, and block covert tracking techniques, like fingerprinting may also reduce the quantity and quality of ~~the~~user data and metrics that can be collected or used by us and our partners. These limitations may adversely affect our advertisers’ ability to effectively target advertisements and measure their performance, which could reduce the demand and pricing for our advertising products and harm our business. As such, our digital property’s current and potential advertiser clients may ultimately find digital advertising to be less effective than traditional advertising media or marketing methods or other technologies for promoting their products and services, and they may even reduce their spending on mobile advertising from current levels as a result or for other reasons.;

If● ~~the~~users ~~market~~are no longer willing to pay for ~~mobile~~subscriptions ~~advertising~~or ~~deteriorates, we~~in-app ~~may~~purchases ~~not~~or bewe ~~able~~are unable to increase ~~our~~the ~~revenues~~price orof our ~~revenues~~subscriptions ~~and~~or ~~profitability~~in-app ~~could decline materially.~~purchases;

A● ~~material~~users ~~amount~~have ofdifficulty ~~our~~installing, ~~revenue~~updating isor ~~generated from~~otherwise aaccessing ~~limited~~our ~~number~~products ofand ~~geographies~~services ~~and~~as ~~third-party~~a ~~advertising~~result ~~demand~~of ~~partners.~~our ~~Any~~actions ~~change~~or tothose ~~this~~of ~~mix~~third ~~could~~parties ~~result~~that inwe ~~negatively~~rely ~~impacting our~~on ~~business,~~to ~~financial~~distribute ~~condition,~~our products and ~~results~~deliver ofour ~~operations.~~services;

In● ~~fiscal~~we ~~2024,~~fail ~~revenue~~to ~~from~~introduce ~~well~~new ~~developed~~features, ~~economies accounted~~products ~~for~~or ~~approximately~~services ~~80%~~that ~~of our total revenues and 69% of our total advertising revenues were generated by three advertising demand partners. While our end~~ users ~~are~~find ~~located~~engaging ~~around~~or ~~the~~enhance ~~world,~~ the ~~revenue~~existing isproducts ~~generated~~and inservices ~~the United States from our advertising partners. During the past five years, we have experienced a shift in our Zedge App’s regional customer make-up~~ with ~~the~~improvements ~~percentage~~that ~~of our total MAU from emerging markets increasing, while the portion from well-developed markets is decreasing. In fiscal 2024, 79% of our Zedge App’s~~ users were located in emerging markets with 21% of users in well-developed regions compared to 78% and 22% respectively in fiscal 2023. India comprised 30% of our MAU as of July 31, 2024. This shift has negatively impacted revenues because well-developed markets command materially higher advertising rates when compared to those in emerging markets. Although we are ~~investing~~interested in reversing this trend, we may not be successful in this effort which may result in lower revenues and profitability. Although GuruShots’ and Emojipedia’s user bases are more heavily weighted to well-developed economies, we are still exposed to the impact of a shift in our Zedge App’s user base toward emerging markets.;

~~Three~~● ~~advertising~~we ~~demand~~are ~~partners,~~unable ~~mainly, Google, Vungle and AppLovin were responsible for 69% of overall advertising revenue in fiscal 2024. If any of these advertising demand partners were~~ to ~~alter~~acquire ~~their~~users ~~spend~~through oncost-effective ~~our~~marketing ~~digital~~efforts, ~~properties~~including ~~the~~both ~~outcome~~organic ~~could result in lowering revenues~~ and ~~profitability.~~paid channels;

In● ~~addition,~~we onare ~~April~~unable ~~24,~~attract ~~2024~~sufficient ~~President~~new ~~Joe~~paying ~~Biden~~users ~~signed a bill that would ban TikTok in the United States if ByteDance, TikTok’s Chinese owner, didn’t sell the platform~~ to aoffset ~~non-Chinese~~and ~~owner within~~exceed ~~nine~~those ~~months.~~lost ~~Although~~through ~~TikTok~~natural ischurn ~~challenging~~thus ~~the~~making ~~legality of this bill in court~~ it ismore ~~unclear~~difficult ifto ~~they~~maintain ~~will prevail. The negative impact of a TikTok ban could be material impacting advertising~~ and ~~ecommerce.~~grow ~~In light of TikTok running ads in Zedge’s platform a ban could negatively impact revenue.~~revenues;

13● initiatives designed to attract and maintain users and increase engagement are unsuccessful because of errors that we make or policies instituted by third parties that we use to distribute our products or deliver our services;

~~Our~~● ~~apps’~~third-party ~~user~~initiatives ~~base~~that ismay ~~heavily~~enable ~~weighted to~~greater ~~the~~use ~~Android~~of ~~operating system and~~ our ~~revenues~~products, ~~and~~including ~~profitability~~low-cost ~~may~~or ~~suffer~~discounted ifdata ~~the~~plans, ~~market~~are ~~demand for Android smartphones decreases.~~discontinued;

~~Our~~● ~~apps’~~we ~~user~~adopt ~~base is heavily weighted to smartphones running the Android operating system~~terms, ~~which~~policies ~~constituted~~or ~~approximately~~procedures ~~96%~~related ofto ~~our~~areas ~~MAU~~such ~~(excluding Emojipedia)~~ as ~~of July 31~~privacy, ~~2024~~user data, ~~and~~content ~~most~~ownership, ~~of our revenues for fiscal 2024. Any significant downturn in the overall demand for Android smartphones~~ or ~~the~~monetization ~~use of~~techniques ~~Android~~that ~~smartphones~~are ~~could~~received ~~significantly~~negatively ~~and~~by ~~adversely affect the demand for~~ our ~~products~~users ~~and~~or ~~services and would materially affect our revenues.~~creators;

Although the Android smartphone market has grown rapidly in recent years, it is uncertain whether the Android smartphone market will continue growing at a similar rate in the future. In addition, due to the constantly evolving nature of the smartphone industry, another operating system for smartphones may eclipse the Android operating system and result in a decline in its popularity, which would likely adversely affect our apps’ popularity. To the extent that our products and services continue operating on Android smartphones and to the extent that our future revenues substantially depend on the use and sales of Android smartphones, our business and financial results would be vulnerable to any downturns in the Android smartphone market.13

We● ~~may~~we ~~not~~fail beto ~~successful~~combat ininappropriate ~~diversifying~~or ~~our revenue~~abusive ~~mix~~activity inon ~~order to reduce~~ our ~~significant dependence on third-party advertisers.~~platforms;

In● ~~fiscal 2024, approximately 79% of our revenues excluding GuruShots were generated from advertising sales. We cannot assure you that~~ we ~~will~~are beunable successful in diversifying our revenue mix by identifying new revenue drivers that complement our advertising-heavy business. Although the Zedge App had initial success in converting freemium users into paid subscribers, starting with zero in January 2019 and ending fiscal 2023 with approximately 647,000, we ended fiscal 2024 with 669,000 subscribers, a 3.4% increase and there is no guarantee that we will be successful in improving subscriber base growth or in maintaining our current subscriber base. To date, Zedge Premium has taken longer to ~~scale~~offer ~~than~~relevant wecontent originally anticipated. Furthermore, we are still integrating GuruShots and have not achieved its expected growth trajectory or realized synergies between GuruShots and our legacy operations. Finally, Android users constitute approximately 96% of our overall MAU and are prone to ~~spend less money in apps than iOS and web users. Even if~~ our ~~new initiatives are successful on one platform, we may not be able to replicate that success across other platforms.~~users;

~~Our~~● ~~revenues~~we ~~may~~fail ~~fluctuate materially due~~ to ~~increases~~ ~~and~~provide ~~decreases~~adequate ofsupport ~~new~~for ~~mobile~~our ~~device~~users ~~sales,~~and ~~or other factors, over which we have no control.~~creators;

~~Our~~● ~~revenue~~there ~~may~~are beoutages ~~materially~~or ~~negatively~~other ~~impacted by~~technical aproblems ~~decrease~~that orresult ~~slowdown~~ in ~~new~~making ~~mobile~~our ~~device~~products ~~sales.~~and ~~Demand~~services ~~for~~inaccessible, ~~mobile~~unreliable ~~devices~~or ~~highly~~that ~~correlates~~result toin ~~installs~~a ofpoor ~~our~~user ~~apps and associated usage and revenue generation.~~experience;

If● ~~new~~there ~~mobile~~are ~~device~~actions ~~sales~~by ~~decrease~~governments orthat ~~slowdown,~~ affect accessibility to our products and services ~~will~~in ~~likely~~any ~~experience~~market; ~~fewer installations which will negatively impact our revenue and operations.~~or

We● ~~rely~~there onare ~~third-party~~regulations ~~platforms,~~and/or ~~such~~litigation asthat ~~the iOS~~result ~~App~~in ~~Store,~~users ~~Meta,~~not ~~and~~accepting ~~Google Play Store, to distribute~~ our ~~apps~~terms ~~and~~of ~~collect~~use ~~revenues~~because ~~generated~~of onmeasures ~~these platforms. If these platforms adopt policies including those relating to advertising, privacy, or monetization~~ that ~~are~~we ~~counter~~have totaken ~~our strategy it could result~~ in ~~materially and~~order ~~adversely~~to ~~affecting~~ensure ~~our business~~compliance.

~~Our products and services depend on mobile app~~Certain ~~stores~~of ~~and~~these ~~other~~factors ~~third~~have, ~~parties~~at ~~such~~various ~~as data center service providers~~times, asnegatively ~~well~~impacted asuser ~~third party cloud infrastructure~~ and ~~service~~creator ~~providers~~growth, ~~payment~~ ~~aggregators,~~MAU ~~computer systems, internet transit providers~~ and ~~other communications systems and service providers~~engagement. ~~Our~~If ~~mobile~~we ~~applications~~ are ~~almost~~unable ~~exclusively~~to ~~accessed through and depend on the Google Play Store and Apple’s App Store. While our mobile applications~~maintain ~~are~~or ~~generally~~increase ~~free to download from these stores, we offer~~ our ~~users~~user ~~the~~base ~~opportunity to make in-app purchases~~ and~~/or~~ ~~purchase~~user ~~paid subscriptions. In certain instances~~engagement, weour determine the prices at which these items and subscriptions are sold. These purchases are processed by Google’s and Apple’s in-app payment and subscription systems. As of July 31, 2024 we paid Google and Apple up to 30% of the revenue ~~we generated across their respective platforms for processing fees. Our revenues~~ and ~~earnings~~financial ~~could~~results ~~be negatively impacted should Google or Apple decide to impose higher processing fees. Further, our cashflow~~ may be ~~negatively~~materially ~~impacted~~adversely ~~if either platform changes the timing of their payments to us~~affected. While we do not anticipate any interruption in their distribution platforms or ability to accept customer payments, any such disruptions, even temporary, may have material impacts on our business and operations.

14We may not experience growth or engagement in certain geographic locations due to local factors.

We ~~are subject to the standard policies and terms~~ ofmay ~~service~~not ofexperience ~~third-party~~rapid ~~platforms,~~user ~~which~~growth ~~govern~~or ~~the~~continued ~~marketing,~~engagement ~~promotion,~~in ~~distribution,~~countries ~~content~~that ~~and~~have ~~operation~~unreliable oftelecommunications ~~our~~infrastructure ~~apps~~or ~~on their platforms.~~in ~~Each~~countries ~~platform~~where ~~provider has the discretion to make changes to its operating system, payment services, manner in which their~~ mobile ~~operating system operates as well as change~~ and ~~interpret~~internet ~~the~~usage ~~terms~~are ~~and~~expensive ~~conditions~~or oflimited ~~its developer policies. These changes may be harmful to our business and result~~ in aregular ~~negative outcome~~accessibility. ~~For~~Any ~~example,~~decrease in ~~September~~user ~~2019~~retention, ~~our~~growth ~~Zedge App was temporarily removed from Google Play because~~or ~~they~~engagement ~~asserted~~may ~~that~~have ~~the Zedge App violated their malicious behavior policy. As~~ a ~~result,~~material ~~prospective~~and ~~Android~~adverse ~~users~~impact ~~were~~on ~~prevented from installing~~ our ~~Zedge App~~popularity, ~~freemium users were unable to convert into paying subscribers and existing users we unable to purchase Zedge Credits. Shortly after the notice was issued~~revenue, ~~two of our major advertising suppliers ceased serving advertisements to our Zedge App. In addition~~business, Google Play sent a notification to users that had the problematic version of the app on their phone recommending that they uninstall it. We identified the source of the problem as buggy code from a long-termreputation, third-party advertising partner’s standard technology integration in our app. We corrected the problem by removing the offensive code, releasing a new version of our app and our Zedge App was reinstated after approximately 72 hours and concurrently the two major advertising suppliers resumed purchasing our advertising inventory. We estimate the immediate financial ~~impact of the suspension resulted in approximately $100~~condition,~~000~~ ~~in lost revenue~~ and ~~a material decline~~results ~~in MAU with the majority~~ of ~~uninstalls in emerging markets~~operations.

~~Such~~We may ~~changes~~not ~~could:~~be successful in acquiring a sufficient number of users that become purchasers or retain existing users who generate profitable revenue for our apps.

●Revenues of freemium apps and websites typically rely on a small percentage of users that convert into paying users by making in-app purchases of digital goods and/or paid subscriptions; however, the vast majority of users play for free or only occasionally make purchases or opt-in for paid subscriptions. Accordingly, only a small percentage of our ~~products~~users are paying users. In addition, a small portion of paying users generate a disproportionate percentage of revenue. Because of this, it is imperative for us to both retain these valuable customers and ~~services~~to ~~inaccessible~~maintain or ~~limit~~increase their ~~accessibility;~~spend over time. In fiscal 2025, we experienced a 17% increase in subscription revenue and a 29% increase in subscription billings. Conversely, over the past nine years, GuruShots has successfully increased the compounded annual growth rate of monthly spending per paying player by around 6.2%. There can be no assurance that we will be able to continue to retain paying users, grow or maintain subscription levels or that paying users will maintain or increase their spending. We may experience a net decline in paying players resulting in a decrease in revenue resulting in a materially adverse outcome for our business and financial results.

●We may ~~curtail~~not manage our ~~ability~~in-app toeconomy ~~distribute~~well and ~~update~~as ~~our~~a ~~applications~~result, asdisincentivize weusers ~~see~~from ~~fit~~making ~~across~~in-app ~~their~~purchases. ~~platforms;~~Any failure to do so could adversely affect our business, financial condition, and results of operations.

●Our apps ~~impose~~are ~~changes~~available into ~~the~~players ~~way~~for infree ~~which~~and each brand generates a material portion of its revenue by selling digital goods and/or paid subscriptions. The perceived value of these digital goods and/or paid subscriptions can be impacted by various factors including, but not limited to, their price, discounting policies, promotional strategies, market competition, user reviews, and user engagement levels. If we ~~monetize~~fail to manage our economy well, we risk confusing or upsetting users; to the point that they reduce their purchases which could negatively hurt the business.

~~● limit the scope of feature enhancements or new features;~~14

●If we ~~decrease~~are unable to compete for advertisers or ~~eliminate~~if ~~our~~advertisers ~~ability~~reduce totheir ~~market~~spend towith ~~prospective~~us, our revenues, profitability and ~~existing~~prospects ~~users;~~may be ormaterially and adversely affected.

●In fiscal ~~cease~~2025, approximately 75% of our ~~ability~~revenues (excluding GuruShots) were generated from selling advertising inventory. We generally enter into arrangements with the major programmatic advertising networks to ~~collect~~monetize ~~certain~~our advertising inventory. We need to maintain good relationships with these advertising networks to provide us with a sufficient inventory of advertisements. Online advertising, including through mobile applications, is an intensely competitive industry. Many large companies, such as Applovin, Meta and Google, invest significantly in data ~~about~~analytics to make their properties and platforms more attractive to advertisers. Our advertising revenue is primarily a function of the number and hours of engagement of our free users and ~~their~~our ~~respective~~ability ~~usage~~to provide innovative advertising products that are relevant to our users, maintain or increase user engagement and satisfaction with our products, and enhance returns and add incremental gains for our advertising partners. If our relationship with any advertising partners terminates for any reason, or if the commercial terms of our relationships are changed or do not continue to be renewed on favorable terms, or if we cannot source high-quality ads consistent with our brand or product experience, we would need to qualify new advertising partners, which could negatively impact our revenues, at least in the short term.

~~Google~~In addition, internet-connected devices and ~~Apple~~operating ~~are~~systems ~~able~~controlled toby ~~terminate~~third ~~our~~parties ~~distribution~~increasingly contain features that allow device ~~agreements~~users ~~with~~to ~~them,~~disable ~~without~~functionality ~~cause,~~that ~~with~~allows 30for ~~days~~the ~~prior~~delivery ~~written~~of ~~notice~~advertising ~~(to~~on their devices or reduce the ~~extent~~ability ~~allowed~~to byprovide ~~applicable~~personalized or ~~local~~targeted ~~law)~~advertising, which results in less valuable ads. ~~They~~Device ~~also~~and browser manufacturers may include or expand these features as ~~terminate~~part ~~our~~of ~~agreements~~their ~~with~~standard ~~them~~device ~~immediately~~specifications. ~~(unless~~For example, when Apple announced that IDFA, a standard device identifier used in some applications, was being superseded and would no longer ~~period~~be issupported, application developers were required byto ~~applicable~~update ~~law)~~their ~~under~~apps ~~certain~~to ~~circumstances~~utilize alternative device identifiers such as universally unique identifier, ~~including~~or, more recently, identifier-for-advertising, which simplifies ~~upon~~the ~~our~~process ~~uncured~~for ~~breach~~Apple users to opt out of ~~such~~behavioral ~~agreements~~targeting. ToFurthermore, ~~the~~laws ~~extent~~and ~~that~~regulations ~~they~~may also make it more difficult to deliver personalized or ~~any~~targeted ~~other~~advertising ~~third~~or ~~party~~impose ~~platform~~requirements ~~provider~~that onresult ~~which~~in wemore ~~rely~~users ~~make~~making ~~such~~elections to block our ability to ~~changes~~deliver ortargeted ~~terminates~~ads. If users do not elect to participate in functionality that supports the delivery of targeted advertising on their devices, our ~~agreements~~ability ~~with~~to ~~them~~deliver effective advertising campaigns could suffer, which could cause our business, financial condition, ~~and~~or operating results ofto ~~operations could~~ be ~~materially~~ adversely affected.

AWe anticipate ~~platform~~that ~~provider~~our ~~may~~growth ~~also~~and ~~change~~profitability ~~its~~will ~~fee~~continue ~~structure~~ to depend on our ~~disadvantage,~~ability ~~change~~to ~~how~~sell weour ~~are~~advertising ~~able~~inventory. toCompanies that advertise onwith ~~the~~us ~~platform,~~may ~~limit~~choose ~~how~~to ~~user~~utilize ~~information~~other isadvertising ~~made~~channels ~~available~~or tomay ~~developers, curtail~~reduce ~~how~~or ~~personal~~eliminate ~~information~~their ismarketing ~~used~~altogether for ~~advertising~~a ~~purposes~~variety of reasons, ormany ~~restrict~~of ~~how~~which ~~users~~are ~~can~~out ~~share~~of ~~information~~our ~~with~~control, ~~their~~including, ~~friends~~without onlimitation, if the demand for mobile phone personalization industry ~~platform~~declines or ~~across~~otherwise ~~platforms~~falls out of favor with advertisers or consumers. ~~For~~In ~~example~~addition, inwe ~~April~~previously ~~2021~~disclosed ~~Apple~~that ~~released~~disruptions ~~iOS~~caused by 14U.S. ~~which~~regulatory ~~started~~action, ~~requiring~~specifically ~~users~~the toTikTok ~~opt~~ban that took effect in toearly ~~share~~2025 ~~their IDFA~~shortly ~~with~~after ~~app~~President ~~developers~~Trump assumed office, had an immediate impact on anadvertiser ~~app-by-app~~behavior. ~~basis~~During that period, U.S. Asadvertising arevenue ~~consequence~~fell, with TikTok advertising spend for the most ~~ability~~part ofdisappearing. ~~advertisers~~This toexperience ~~accurately~~illustrates ~~target~~how ~~and~~government-mandated ~~measure~~restrictions ~~their~~on a major advertiser can impact revenue quickly. ~~advertising~~Should ~~campaigns~~future atregulation, ~~the~~such ~~user~~as ~~level~~a ~~becomes~~reinstated ~~significantly~~or ~~more~~expanded ~~difficult~~ban on TikTok or restrictions on other platforms result, ~~typically~~our ~~resulting~~revenue incould be ~~higher~~materially ~~user~~and ~~acquisition~~adversely ~~costs~~affected.

~~Furthermore, both Apple and Google have broad~~If ~~discretion to make changes to their operating systems or payment services or change~~ the ~~manner~~size ~~in which their mobile operating systems function and their respective terms and conditions applicable to the distribution~~ of ~~our applications, including~~ the ~~amount~~digital ~~of,~~advertising ~~and~~market ~~requirement to~~does ~~pay,~~not ~~certain~~increase ~~fees~~from ~~associated~~current ~~with purchases required to be facilitated by Apple and Google through our applications~~levels, ~~and to interpret their respective terms and conditions in ways that may limit, eliminate~~ or ~~otherwise~~if ~~interfere with~~ our ~~products,~~digital ~~our~~brands ~~ability~~are tounable ~~distribute our applications through their stores, our ability~~ to ~~update~~capture ~~our applications, including to make bug fixes or other feature updates or~~and ~~upgrades,~~retain ~~the~~a ~~features~~sufficient weshare ~~provide,~~of ~~the~~that ~~manner in which we~~ market ~~our in-app products~~, our ability to ~~access~~maintain ~~native functionality~~ or ~~other aspects~~increase ~~of mobile devices, and~~ our ~~ability~~current tolevel ~~access information about our users that they collect. To the extent either or both~~ of ~~them do~~advertising ~~so,~~revenues and our ~~business~~revenues, profitability ~~financial condition~~ and ~~results~~prospects ~~of operations~~ could be materially and adversely affected.

15The digital advertising market may deteriorate, which could materially harm our business and results of operations.

~~For example, pursuant to Google’s policy~~We ~~whereby~~generate ~~only~~the ~~Google~~substantial ~~Play’s~~majority ~~in-app billing system could be used for transactions in its store, we were mandated to stop the provision~~ of ~~non-native payment options to~~ our ~~users~~revenue onfrom ~~Android~~selling ~~during~~advertising ~~2021, which caused disruptions for users and led to a decline in Paying Users~~inventory. ~~Since~~ announcing this policy in 2020, following industry pushback and country-specific regulations Google has introduced in select markets the option of “user choice billing,” which allows eligible developers to offer users an additional billing system alongside Google Play’s billing system, and in the European Economic Area the option for eligible developers to offer users an alternative to Google Play’s billing system. We ~~are~~anticipate ~~exploring~~that ~~such~~our ~~solutions~~growth ~~on a country-by-country basis. However, as these solutions are in their infancy, they may evolve following subsequent regulatory mandates or organically at Google’s behest,~~ and ~~as such we will~~profitability ~~need~~will tocontinue ~~be ready~~ to ~~continuously~~depend ~~adapt to such changes. Any deadlines imposed~~ on ~~developers~~our byability ~~future iterations of Google’s policy will require prompt and active development, and failure~~ to dosell soadvertising ~~may~~inventory ~~result~~across insome ~~the~~if ~~discontinuation~~not ofall ~~the provision~~ of ~~alternative billing methods to~~ our ~~users~~digital brands.

~~Similarly, Apple is experiencing industry pushback~~Future ~~and~~demand ~~country-specific~~for ~~regulations.~~mobile Inadvertising ~~response~~is ~~to a recent antitrust lawsuit, Apple now allows all digital apps in the United States to include a link to the developer’s website to process payments for in-app purchases~~uncertain. ~~Additionally,~~Many inadvertisers ~~the~~still ~~EU,~~have ~~pursuant~~limited toexperience ~~the~~with ~~Digital Markets~~mobile ~~Act,~~advertising ~~all major app store operators such as Google~~ and ~~Apple~~may ~~will~~continue ~~be forced~~ to ~~introduce more country-specific billing policies~~ ~~that~~devote ~~allow~~larger ~~developers~~portions to offer alternative billing methods, and it is expected that other markets may follow suit. Further complicating this landscape, a recent ruling by the United States District Court for the Northern District of ~~California~~their inadvertising ~~Epic~~budgets ~~Games~~to v.more ~~Google mandates~~traditional ~~that~~offline ~~Google~~or ~~must~~online ~~open~~personal ~~its Android app store to third~~computer-~~party~~based ~~competitors for three years~~advertising, ~~from November 1, 2024 through November~~instead 1,of ~~2027,~~shifting ~~which~~additional ~~will~~advertising ~~likely~~resources ~~foster increased competition and could lead~~ to ~~changes~~mobile ~~in fee structures and app distribution practices~~advertising.

Should we choose to explore such policy initiatives for the benefit of our business and our users, we may potentially become subject to highly nuanced, country-specific billing policies and commissions of major app store operators, we may need to devote more resources and time in creating and managing separate app bundles for each country in which we want to offer alternative billing options, which could become burdensome, and/or we could become subject to higher commissions overall. Furthermore, changes to billing options may cause a disruption to the user journey, which could cause a decrease in paying user conversion rates. Alternatively, choosing not to explore such policy initiatives could present a risk of missed opportunity. Any of the foregoing could materially adversely affect our business, financial condition and results of operations.15

IfFurther, our weadvertisers’ ~~violate,~~ability orto aeffectively ~~platform~~target ~~provider~~their ~~believes~~advertising to our user’s interests may be negatively impacted by the degree to which our privacy control measures that we have ~~violated,~~implemented ~~its~~or ~~terms~~may ofimplement ~~service,~~in the ~~platform~~future ~~provider~~in ~~reserves~~connection ~~the~~with ~~right~~regulations, regulatory toactions, ~~limit~~the user experience, or ~~cease~~otherwise, ~~access~~and toour ~~their~~advertising ~~platform.~~revenue Ifmay wedecrease ~~are~~or otherwise be curtailed as a result. ~~unable~~Changes to ~~maintain~~operating asystems’ ~~productive~~practices ~~working~~and ~~relationship~~policies, ~~with~~such ~~any~~as ~~platform~~Apple’s ~~distribution~~deprecating the Identifier for Advertisers (“IDFA”) and ~~access~~changes by Google to ~~our~~its ~~products~~advertising and ~~services~~tracking ~~could~~policies, ~~also~~including the planned deprecation of third-party cookies in Chrome and bea ~~curtailed~~shift oraway ~~permanently~~from ~~disabled.~~certain ~~This~~elements isof ~~especially~~its ~~true~~Privacy inSandbox ~~instances~~initiative, ~~where~~as wewell ~~are~~as ~~dependent~~efforts onto ~~single~~block ~~source~~covert ~~providers~~tracking ~~for~~techniques ~~their~~like fingerprinting, ~~respective~~may ~~services.~~also ~~Any~~reduce ~~limitation~~the orquantity ~~discontinuation~~and quality of ~~access~~the todata ~~any~~and ~~platform~~metrics ~~could~~that ~~significantly~~can ~~reduce~~be ~~our~~collected ~~ability~~or toused ~~distribute~~ by us and~~/or~~ ~~provide~~our ~~access~~partners. toThese limitations may adversely affect our ~~products~~advertisers’ ability to ~~users~~effectively target advertisements and ~~would~~measure ~~like~~their ~~result~~performance, inwhich ~~materially~~could reduce the demand and ~~adversely~~pricing ~~affecting~~for our advertising products and harm our business. As such, ~~financial~~our ~~condition~~digital property’s current and potential advertiser clients may ultimately find digital advertising to be less effective than traditional advertising media or marketing methods or other technologies for promoting their products and ~~results~~services, ofand ~~operations~~they may even reduce their spending on mobile advertising from current levels as a result or for other reasons.

~~Our business depends on~~ If the ~~availability~~market offor mobile ~~app~~ ~~stores~~advertising ~~and~~deteriorates, ~~other~~we ~~third~~may ~~party~~not ~~platforms~~be ~~and~~able ~~any~~to ~~outages~~increase ~~that~~our ~~these~~revenues ~~parties~~or ~~experience will likely have a negative impact on~~ our ~~business, financial~~revenues ~~condition,~~and ~~results~~profitability ofcould ~~operations or reputation~~decline materially.

IfA material ~~technologies~~amount ~~designed~~of toour ~~block~~revenue ~~the~~is ~~display~~ generated from a limited number of ~~advertisements~~geographies ~~are~~and ~~adopted~~third-party enadvertising ~~masse,~~demand orpartners. ifAny ~~web~~change to ~~browsers~~this ~~limit~~mix orcould ~~block~~result ~~behavioral~~in ~~targeting~~negatively ~~technologies~~impacting our ~~revenues~~business, ~~may~~financial becondition, ~~adversely affected~~and results of operations.

~~Technologies~~In fiscal ~~have~~2025, ~~been~~revenue from well developed, economies accounted for approximately 81% of our total revenues and ~~will~~72% ~~likely~~of our total ~~continue~~advertising torevenues bewere ~~developed,~~generated ~~that~~by ~~can~~three ~~block~~advertising demand partners. While our end users are located around the ~~display~~world, ofthe revenue ~~advertisements~~is ongenerated ~~our~~in ~~digital~~the ~~products~~United ~~and~~States ~~services~~from our advertising partners. WeDuring ~~may~~the ~~suffer~~past ~~negative~~five ~~consequences~~years, ~~including~~ we have experienced a ~~material~~shift ~~reduction~~in our ofZedge ~~revenue,~~App’s regional customer make-up with ~~mass~~the ~~adoption~~percentage of ~~website~~our adtotal ~~blocking~~MAU ~~technologies~~from oremerging ~~other~~markets ~~technologies~~increasing, ~~that~~while ~~limit~~ the ~~ability~~portion tofrom ~~personalize~~well-developed ~~advertisements,~~markets ~~including,~~is ~~without~~decreasing. ~~limitation~~In fiscal 2025, if76.7% ~~the~~of ~~price~~our ~~for~~Zedge ~~this~~App’s ~~advertising~~users ~~inventory~~were ~~declines.~~located Wein ~~generate~~emerging ~~substantially~~markets ~~all~~with 23.3% of ~~our~~users ~~revenue~~in ~~from~~well-developed ~~advertising,~~regions ~~and~~compared ~~ad-blocking~~to ~~technologies~~21.1% ~~may~~and ~~prevent~~78.9% ~~the~~respectively ~~display~~in offiscal ~~certain~~2024. ~~advertisements~~India ~~appearing~~comprised 32.5% onof our ~~platform,~~MAU ~~which~~as ~~could~~of ~~harm~~July ~~our business~~31, ~~operating~~2025. ~~results,~~This ~~and~~shift ~~financial~~has ~~condition.~~negatively ~~Existing~~impacted adrevenues because well-~~blocking~~developed ~~technologies~~markets ~~that~~command ~~have~~materially higher ~~not~~advertising ~~been~~rates ~~effective~~when oncompared ~~our~~to ~~platform~~those ~~may~~in ~~become~~emerging ~~effective~~markets. asAlthough we ~~make~~are ~~certain~~investing ~~platform~~in ~~changes~~reversing this trend, ~~and~~we ~~new~~may ~~ad-blocking~~not ~~technologies~~be successful in this effort which may beresult ~~developed~~ in lower revenues and profitability. Although GuruShots’ and Emojipedia’ s user bases are more heavily weighted to well-developed economies, our overall revenue remains sensitive to the ~~future~~regional composition of our Zedge App’s user base.

16Three advertising demand partners, mainly, Google, Liftoff, and AppLovin were responsible for 72% of advertising revenue in fiscal 2025. If any of these advertising demand partners were to alter their spend on our digital properties the outcome could result in lowering revenues and profitability.

~~Activities~~In addition, ofon ~~our~~April 24, 2024, ~~advertiser~~President ~~clients~~Biden ~~and/or~~signed the Protecting Americans from Foreign Adversary Controlled Applications ~~users~~Act ~~could~~(PAFACA), ~~damage~~which ~~our~~required ~~reputation~~ByteDance, orTikTok’s ~~give~~Chinese ~~rise~~owner, to ~~legal~~divest ~~claims~~the ~~against~~app’s usU.S. operations by January 19, 2025, or face a nationwide ban. This law was upheld by the U.S. Supreme Court in January 2025 in TikTok v. Garland.

~~Our advertisers and/or users may not comply with~~After ~~international~~briefly orgoing ~~domestic~~offline ~~laws,~~in ~~including~~mid-January, ~~but~~TikTok ~~not~~continued ~~limited~~ to, ~~laws~~operate ~~and~~in ~~regulations~~the ~~relating~~U.S. tounder ~~mobile~~a ~~communications.~~series ~~Failure~~ of ~~our advertisers~~executive ~~and/or~~orders ~~users~~signed toby ~~comply~~President Trump, ~~with~~each ~~laws~~delaying orenforcement ~~our~~of ~~policies~~the ~~could~~federal ~~damage~~ban ~~our~~by ~~reputation~~75- ~~and expose us~~ to ~~liability~~90-day ~~under these laws~~increments. We ~~may~~The ~~also~~most berecent ~~liable~~extension toset ~~third~~a ~~parties~~compliance ~~for~~deadline of ~~content~~September ~~in the advertisements or content we deliver or distribute if the artwork~~17, ~~text~~2025. orShortly ~~other content~~before ~~involved~~that ~~violates copyrights~~date, ~~trademarks or other intellectual property rights of third parties or if~~ the ~~content~~U.S. ~~is defamatory, unfair~~ and ~~deceptive,~~China orannounced ~~otherwise~~they inhad ~~violation~~reached ofa ~~applicable~~framework ~~laws.~~agreement ~~Although~~to wetransition ~~generally receive assurance from our advertising partners~~TikTok’s ~~and~~U.S. ~~users~~operations ~~that~~toward ~~their~~a ~~advertisements~~U.S.-based ~~and~~ownership ~~content~~structure, ~~respectively,~~aimed ~~are~~at ~~lawful~~preserving ~~and~~continued ~~that~~operation ~~they~~in ~~have~~ the ~~right~~U.S. towhile ~~use~~satisfying ~~any copyrights, trademarks~~national orsecurity ~~other~~concerns. ~~intellectual~~Consistent ~~property~~with ~~included~~this inframework, anon ~~advertisement~~September or16, ~~content~~2025, ~~and although we are normally indemnified by~~ the ~~advertisers,~~President ~~a third~~signed ~~party or regulatory authority may still file~~ a ~~claim~~new ~~against~~executive ~~us.~~order ~~Any~~further ~~such claims could be costly and time consuming to defend and~~extending ~~could also hurt our reputation within~~ the ~~mobile~~compliance ~~advertising~~deadline ~~industry. Further, if we are exposed~~ to ~~legal~~December ~~liability~~16, ~~we could be required to pay substantial fines or penalties, redesign our business methods, discontinue some of our services or otherwise expend significant resources~~2025.

WeShould TikTok ~~may~~fail ~~not~~to becomplete ~~able~~an toapproved ~~continually~~divestiture or meet ~~our users’~~U.S. ~~expectations~~requirements under the PAFACA and ~~retain~~its orimplementing ~~expand~~regulations ~~our~~by ~~user~~December 16, ~~base~~2025, ~~and~~enforcement ~~our~~of ~~revenues~~the federal ban could resume, ~~profitability~~including ~~and~~removal ~~prospects~~of ~~may~~the beapp ~~materially~~from U.S. app stores and ~~adversely~~other restrictions. This ~~affected~~poses material risks to advertising and e-commerce, including revenue tied to TikTok-based promotions on Zedge’s platform.

Although we constantly monitor and research our users’ expectations, we may be unable to meet them on an ongoing basis or anticipate future user needs. A decrease in the number of users engaging with our products and services may have a material and adverse effect on our ability to sell advertising, digital goods and resources, and subscriptions and on our business, financial condition and results of operations. In order to attract and retain users and remain competitive, we must continue to innovate our products and services, improve user experience, and implement new technologies and functionalities.16

~~The internet business is characterized by constant~~Our ~~changes,~~apps’ ~~including but not limited to rapid technological evolution, continual shifts in~~ user ~~expectations,~~base ~~frequent~~is ~~introductions~~heavily ~~of new~~weighted products and services and constant emergence of new industry standards and practices. As a result, our users may leave us for our competitors’ products and services more quickly than in other sectors. Thus, our success will depend, in part, on our ability to ~~respond~~ tothe ~~these~~Android ~~changes~~operating insystem ~~a timely~~ and ~~cost-effective basis, including improving and marketing~~ our ~~existing~~revenues ~~products~~ and ~~services~~profitability ~~and developing~~may ~~and~~suffer ~~pricing~~if ~~new~~the ~~products and services in response to evolving user needs. Our ability to successfully retain or expand our~~market ~~user~~demand ~~base~~for ~~will~~Android ~~depend~~smartphones ~~on our ability to achieve the following, among others:~~decreases.

●Our apps’ ~~anticipate~~user ~~and~~base ~~effectively~~is ~~respond~~heavily weighted to smartphones running the ~~growing~~Android ~~number~~operating system, which constituted approximately 95% of our ~~internet~~MAU ~~users~~(excluding inEmojipedia) ~~general~~as of July 31, 2025, and most of our ~~users~~revenues for fiscal 2025. Any significant downturn in ~~particular;~~the overall demand for Android smartphones or the use of Android smartphones could significantly and adversely affect the demand for our products and services and would materially affect our revenues.

●Although the ~~attract,~~Android ~~retain~~smartphone ~~and~~market ~~motivate~~has ~~talent~~grown rapidly in recent years, ~~including~~it ~~but~~is ~~not~~uncertain ~~limited~~whether tothe ~~application~~Android ~~developers~~smartphone market will continue growing at a similar rate in the future. In addition, ~~visual~~due ~~designers~~to the constantly evolving nature of the smartphone industry, ~~product~~another ~~and~~operating system ~~program~~for ~~managers~~smartphones may eclipse the Android operating system and ~~engineers~~result ~~who~~in ~~have~~a ~~experience~~decline ~~developing~~in ~~consumer~~its ~~facing~~popularity, ~~digital~~which ~~products~~would orlikely ~~other~~adversely affect ~~mobile~~our ~~internet~~apps’ popularity. To the extent that our products and services; continue operating on Android smartphones and to the extent that our future revenues substantially depend on the use and sales of Android smartphones, our business and financial results would be vulnerable to any downturns in the Android smartphone market.

●We may ~~effectively~~not ~~market~~be ~~our~~successful ~~existing~~in ~~and~~diversifying ~~new~~our ~~products~~revenue ~~and~~mix ~~services~~ in ~~response~~order to ~~evolving~~reduce ~~user~~our ~~needs;~~significant dependence on third-party advertisers.

●In fiscal ~~develop~~2025, approximately 75% of our revenues excluding GuruShots were generated from advertising sales. We cannot assure you that we will be successful in diversifying our revenue mix by identifying new revenue drivers that complement our advertising-heavy business. Although the Zedge App had initial success in converting freemium users into paid subscribers, starting with zero in January 2019 and ending fiscal 2024 with approximately 669,000, we ended fiscal 2025 with 984,000 subscribers, a ~~timely~~47% ~~fashion~~increase and ~~launch~~we ~~new~~may ~~products~~not be successful in improving subscriber base growth or in maintaining our current subscriber base. Furthermore, the subscription growth we experienced in fiscal 2025 was fueled by converting users to lifetime subscriptions and ~~features~~offers that aligned with localized pricing dynamics. We may not be able to continue to be able to drive this growth as market dynamics may change. To date, Zedge Premium has taken longer to scale than we originally anticipated. Furthermore, we are still integrating GuruShots and ~~develop~~have not achieved its expected growth trajectory or realized synergies between GuruShots and ~~launch~~our ~~other~~legacy ~~internet~~operations. ~~products~~Finally, ~~cost-effectively;~~Android users constitute approximately 95% of our overall MAU and are prone to spend less money in apps than iOS and web users. Even if our new initiatives are successful on one platform, we may not be able to replicate that success across other platforms.

●Our revenues ~~funnel~~may ~~our~~fluctuate ~~existing~~materially ~~users~~due to increases and ~~prospects~~decreases ~~into~~of new ~~products~~mobile ~~that~~device ~~we develop~~sales, ~~independent~~or ofother ~~our current product suite~~factors, ~~and~~over ~~convert~~which ~~them~~we ~~into~~have ~~recurring users of these new products;~~no control.

●Our revenue ~~successfully~~may ~~recruit~~be ~~new~~materially ~~users,~~negatively ~~artists,~~impacted ~~individual~~by ~~creators~~a ~~and~~decrease ~~brands~~or ~~that~~slowdown ~~offer~~in ~~their~~new ~~content~~mobile device sales. Demand for mobile devices highly correlates to installs of our ~~users;~~apps and associated usage and revenue generation.

●If new ~~further~~mobile ~~improve~~device ~~our~~sales ~~platform~~decrease toor ~~provide~~slowdown, aour ~~compelling and optimal user experience through integration of~~ products and services ~~provided~~will bylikely ~~existing~~experience ~~and~~fewer ~~new~~installations ~~third-party~~which ~~developers~~will ornegatively impact ~~business~~our ~~partners;~~revenue and operations.

●We rely ~~continue~~on third-party platforms, primarily the iOS App Store, Meta, and Google Play Store, to ~~provide~~distribute ~~quality~~our apps, process payments, and collect revenues generated on these platforms. These platforms exercise significant control over app distribution, monetization, advertising, and privacy policies, and frequently update their algorithms and terms of service. In addition, the integration of AI-driven content and tosearch ~~attract~~results by these platforms (e.g., Google’s “AI Overviews” and ~~retain~~similar generative AI features from Apple and Meta) may reduce organic traffic to our ~~users~~properties by embedding content directly in platform experiences. If these platforms adopt policies — including those relating to AI integration, advertising, privacy, monetization, or content display — that are counter to our strategy, our business could be materially and ~~advertisers~~adversely affected.

17Our products and services depend almost entirely on mobile app stores, particularly Google Play and Apple’s App Store, and on other third parties such as data center service providers, as well as third party cloud infrastructure and service providers, payment aggregators, computer systems, internet transit providers and other communications systems and service providers. Our mobile applications are almost exclusively accessed through and depend on the Google Play Store and Apple’s App Store. While our apps are generally free to download, we monetize through in-app purchases, subscriptions, and advertising, all of which depend on compliance with evolving platform policies. As of July 31, 2025, we paid Google and Apple processing fees of up to 30% for transactions, and we remain exposed to changes in fee structures, payout timing, and permitted monetization models. Any interruption, degradation, or policy change, including restrictions on AI-generated content or mandatory labeling of such content, could materially impact our business. While we do not anticipate any interruption in their distribution platforms or ability to accept customer payments, any such disruptions, even temporary, may have material impacts on our business and operations.

~~We cannot assure you that our existing products~~Platform-driven ~~and~~changes ~~services,~~to ~~will~~content ~~remain~~accessibility ~~sufficiently~~may ~~popular~~also ~~with~~impact our ~~users.~~traffic Weand ~~may~~revenue. beFor ~~unsuccessful~~instance, in ~~adding~~late ~~compelling~~September ~~new features and enhancements; products and services to further diversify these product offerings. Unexpected technical~~2025, ~~commercial~~Google orupdated ~~operational~~its ~~problems could delay~~Search orEngine ~~prevent~~Results ~~the~~Page ~~introduction~~(SERP) ~~of one or more of our new products or services~~ to ~~our~~allow users. ~~Moreover,~~to wecopy ~~cannot~~emojis bedirectly ~~sure~~from ~~that~~search ~~any~~results, ofbypassing ~~our~~third-party ~~new products~~sites ~~and~~like ~~services~~Emojipedia. ~~will achieve widespread market acceptance or generate incremental revenue the way our existing products and services~~This ~~have.~~change Ifcould wereduce ~~fail~~organic intraffic ~~earning~~to ~~user satisfaction through~~ our ~~products~~content-dependent or services, orpotentially ifleading ~~our products and services fail~~ to ~~meet~~a ~~our~~decline ~~expectation to~~in ~~maintain and expand our user base, our business, results of operations and financial condition will be materially and adversely affected~~revenue.

~~Zedge Premium, the section of our marketplace where we offer premium content (i.e., for purchase), may not yield the strategic goals and objectives that we envision.~~17

~~Although~~We are wesubject ~~believe~~to ~~that~~the ~~Zedge~~standard ~~Premium~~policies ~~will~~and ~~act as~~terms anof ~~important~~service ~~driver~~of inthird-party ~~helping~~platforms, which govern the marketing, promotion, distribution, content and operation of our ~~platform~~apps ~~become~~on atheir ~~leading~~platforms. Each platform ~~for~~provider ~~professional~~has ~~artists~~the discretion to make changes to its operating system, payment ~~individual~~services, ~~creators~~manner in which their mobile operating system operates as well as change and ~~brands~~interpret ~~looking~~the terms and conditions of its developer policies. These changes may be harmful to ~~distribute~~our business and result in a negative outcome. For example, in September 2019, our Zedge App was temporarily removed from Google Play because they asserted that the Zedge App violated their ~~work~~malicious tobehavior ~~consumers~~policy. As ~~looking~~a ~~for~~result, anprospective ~~easy~~Android users were prevented from installing our Zedge App, ~~entertaining~~freemium users were unable to convert into paying subscribers and ~~unique~~existing ~~way~~users were unable to ~~express~~purchase ~~their~~Zedge ~~voice~~Credits. Shortly after the notice was issued, ~~individuality~~two ~~and~~of ~~essence~~our major advertising suppliers ceased serving advertisements to our Zedge App. In addition, Google Play sent a notification to users that had the problematic version of the app on their phone recommending that they uninstall it. We identified the source of the problem as buggy code from a long-term, third-party advertising partner’s ~~premature~~standard totechnology ~~conclude~~integration ~~this~~in asour ~~being~~app. We corrected the ~~case~~problem by removing the offensive code, releasing a new version of our app and our Zedge App was reinstated after approximately 72 hours and concurrently the two major advertising suppliers resumed purchasing our advertising inventory. We estimate the immediate financial impact of the suspension resulted in approximately $100,000 in lost revenue and a material decline in MAU with the majority of uninstalls in emerging markets.

~~Although Zedge Premium’s gross transaction~~Such ~~revenue~~changes has shown modest growth it is still too early to state with conviction that Zedge Premium will have a materially positive impact on our business. In order to do so, we still need, among other things, tocould:

● ~~successfully~~make ~~market~~our ~~the~~products ~~recently-launched~~and ~~web-based~~services ~~offering~~inaccessible toor ~~both~~limit ~~creators~~their ~~and consumers~~accessibility;

● ~~expand~~curtail ~~the~~our ~~digital~~ability ~~content~~to ~~types~~distribute weand ~~offer~~update toour ~~include~~applications ~~more~~as ~~types~~we ofsee ~~creators~~fit across their platforms;

● ~~continue~~impose tochanges ~~ensure~~in ~~that~~the weway ~~build~~in ~~best-of-breed~~which ~~tools~~we ~~for~~monetize ~~Zedge~~our ~~Premium content creators that, amongst other things, meet their needs and properly address marketing, distribution, monetization, reporting, support, and ease of use~~users;

● ~~continue~~limit tothe ~~develop~~scope ~~a wide array~~ of ~~monetization~~feature ~~mechanisms~~enhancements ~~Zedge~~or ~~Premium~~new ~~creators in order to optimize revenue generation~~features;

● ~~continue~~decrease ~~evolving~~or ~~exclusive,~~eliminate ~~limited~~our ~~edition~~ability ~~digital~~to ~~content~~market ~~functionality~~to ~~that~~prospective ~~meets~~and ~~the~~existing ~~needs~~users; ~~of both creators and consumers~~or

● ~~successfully~~cease ~~market~~our ~~Zedge~~ability ~~Premium~~ to ~~the~~collect ~~creative~~certain ~~community~~data ~~and~~about ~~secure~~users ~~their~~and ~~adoption as a must-have in~~ their ~~omnichannel~~respective ~~distribution mix;~~usage.

●Google and ~~effectively~~Apple ~~market~~are able to terminate our distribution agreements with them, without cause, with 30 days prior written notice (to the extent allowed by applicable local law). They also may terminate our agreements with them immediately (unless a longer period is required by applicable law) under certain circumstances, including upon our uncured breach of such agreements. To the extent that they or any other third party platform provider on which we rely make such changes or terminates our agreements with them, our business, financial condition and ~~convert~~results ~~GuruShots’~~of ~~players~~operations ~~into~~could ~~Zedge~~be ~~Premium~~materially ~~artists;~~adversely affected.

●A platform ~~establish~~provider ~~that~~may ~~Zedge~~also ~~Premium~~change its fee structure to our disadvantage, change how we are able to advertise on the platform, limit how user information is made available to developers, curtail how personal information is used for advertising purposes, or restrict how users can beshare ~~valuable~~information with their friends on the platform or across platforms. For example, in April 2021 Apple released iOS 14 which started requiring users to opt in to share their IDFA with app developers, on an app-by-app basis. As a ~~sufficient~~consequence, ~~number~~the ability of ~~creators~~advertisers into ~~achieving~~accurately target and measure their ~~marketing~~advertising ~~and~~campaigns ~~monetization~~at ~~objectives;~~the ~~and~~user level becomes significantly more difficult, typically resulting in higher user acquisition costs.

●Furthermore, both ~~continue~~Apple and Google have broad discretion to ~~offer~~make anchanges ~~excellent~~to their operating systems or payment services or change the manner in which their mobile operating systems function and ~~differentiated~~their ~~consumer~~respective ~~experience~~terms and conditions applicable to the distribution of our applications, including the amount of, and requirement to pay, certain fees associated with purchases required to be facilitated by Apple and Google through our applications, and to interpret their respective terms and conditions in ~~Zedge~~ways ~~Premium~~that may limit, eliminate or otherwise interfere with our products, our ability to distribute our applications through their stores, our ability to update our applications, including to ~~all~~make ~~end-user~~bug ~~facing~~fixes ~~attributes~~or ~~ranging~~other ~~from~~feature updates or upgrades, the ~~user~~features ~~interface~~we provide, the manner in which we market our in-app products, our ability to ~~customer~~access ~~support~~native functionality or other aspects of mobile devices, and our ability to access information about our users that they collect. To the extent either or both of them do so, our business, financial condition and results of operations could be materially adversely affected.

~~If Zedge Premium fails to yield the strategic goals and objectives that we envision, our business, results of operations and financial condition will be materially and adversely affected.~~18

WeFor example, ~~may~~pursuant ~~fail~~ to ~~develop~~Google’s ~~popular~~policy ~~new~~whereby ~~features~~only orGoogle Play’s in-app billing system could be used for transactions in its ~~expand~~store, ~~into~~we ~~new~~were ~~verticals~~mandated to stop the provision of non-native payment options to our users on Android during 2021, ~~successfully~~which caused disruptions for users and led to a decline in Paying Users. Since announcing this policy in 2020, ~~negatively~~following ~~impacting~~industry ~~our~~pushback ~~ability~~and country-specific regulations Google has introduced in select markets the option of “user choice billing,” which allows eligible developers to ~~attract~~offer ~~new~~users an additional billing system alongside Google Play’s billing system, and in the European Economic Area the option for eligible developers to offer users an alternative to Google Play’s billing system. In July 2025, the Japan Fair Trade Commission approved a settlement requiring Google to allow alternative billing systems in Japan beginning in 2026, and other jurisdictions are considering similar measures. We are exploring such solutions on a country-by-country basis. However, as these solutions are in their infancy, they may evolve following subsequent regulatory mandates or ~~retain~~organically ~~existing~~at Google’s behest, and as such we will need to be ready to continuously adapt to such changes. Any deadlines imposed on developers by future iterations of Google’s policy will require prompt and active development; failure to comply could result in the discontinuation of alternative billing methods for our users. Additionally, a December 2024 ruling in Epic Games v. Google, now under appeal, requires Google to permit third-party app stores and direct app downloads on Android devices in the United States from November 1, 2024 through November 1, 2027, which could ~~negatively impact~~alter ~~our~~app ~~business~~distribution economics, ~~financial~~fee ~~condition~~structures, and ~~result~~competitive ofdynamics ~~operations~~in ways that may materially affect our business.

18Similarly, Apple is experiencing industry pushback and country-specific regulations. In response to a recent U.S. antitrust settlement, effective January 2025 Apple now allows all digital apps in the United States to include a “prominent link” or button directing users to the developer’s website to process payments for in-app purchases, subject to Apple’s updated commission structure and compliance requirements. In the EU, pursuant to the Digital Markets Act (DMA) and related March 2025 enforcement actions, Apple has been required to (i) permit third-party app stores, (ii) allow side-loading of apps from the web, and (iii) support alternative in-app payment systems without imposing anti-steering restrictions, with similar obligations anticipated for Google. South Korea and Australia have also advanced legislative proposals that, if enacted, could mandate alternative billing options. Further complicating the competitive landscape, regulators in the United Kingdom are reviewing Apple’s compliance with its existing commitments under the UK Competition and Markets Authority’s mobile ecosystem investigation. These global regulatory shifts may require us to adopt highly nuanced, jurisdiction-specific billing and distribution strategies, devote additional resources to compliance, and manage multiple app versions tailored to local rules. Changes to billing options and distribution channels may disrupt the user experience and payment flow, potentially reducing paying user conversion rates. Conversely, opting not to implement alternative options where available could result in missed monetization opportunities. Any of these developments could materially adversely affect our business, financial condition, and results of operations.

If Should we ~~fail~~choose to ~~maintain~~explore ~~and~~such ~~enhance~~policy initiatives for the benefit of our ~~various~~business and our users, we may potentially become subject to highly ~~brands~~nuanced, orcountry-specific ifbilling policies and commissions of major app store operators, we ~~incur~~may ~~excessive~~need ~~expenses~~to devote more resources and time in ~~this~~creating ~~effort,~~and ~~our~~managing ~~business~~separate app bundles for each country in which we want to offer alternative billing options, ~~results~~which ofcould ~~operations~~become burdensome, and/or ~~prospects~~we could become subject to higher commissions overall. Furthermore, changes to billing options may because ~~materially~~a ~~and~~disruption to the user journey, which could cause a decrease in paying user conversion rates. Alternatively, choosing not to explore such policy initiatives could present a risk of missed opportunity. Any of the foregoing could materially adversely affect our business, financial ~~affected~~condition and results of operations.

WeIf we ~~believe~~violate, ~~that~~or ~~maintaining~~if ~~and~~a ~~enhancing~~platform ~~our various~~provider ~~digital~~believes ~~brands~~we ~~and~~have ~~associated~~violated, ~~reputation~~its isterms ~~important~~of toservice or applicable policies, the ~~success~~provider ofmay ~~our~~limit or ~~business.~~terminate ~~Historically,~~our weaccess ~~have~~to ~~not~~its ~~made~~platform, ~~material investments~~with inor ~~this~~without ~~effort~~notice. WeThis ~~believe~~risk ~~that~~extends ato ~~well~~emerging AI-~~recognized~~content ~~and~~compliance ~~respected~~rules, ~~brand~~such isas ~~important~~disclosure or towatermarking ~~increasing~~requirements, ~~the~~which ~~number~~may ofbe ~~users~~interpreted ~~and~~differently ~~enhancing~~ across jurisdictions. Given our ~~attractiveness~~dependence toon ~~users,~~single-source ~~artists,~~distribution via ~~advertisers~~Google Play and ~~business~~the ~~partners.~~App ~~Brand~~Store, ~~recognition~~any ~~and~~limitation ~~enhancement~~or ~~may~~termination ~~directly~~could ~~affect~~significantly reduce our ~~ability to~~reach, ~~maintain~~impair ~~our~~monetization, ~~market~~and ~~position~~materially harm our business.

~~Many~~Our business ~~factors,~~depends ~~some~~on the availability of ~~which~~mobile ~~are~~app ~~beyond~~stores ~~our~~and ~~control, are~~other ~~important~~third toparty ~~maintaining~~platforms and ~~enhancing~~any ~~our~~outages ~~various~~that ~~brands~~these ~~and~~parties ~~may~~experience will ~~negatively~~likely ~~impact~~have ~~our~~a ~~brand~~negative ~~and~~impact ~~reputation~~on ifour ~~not~~business, ~~properly~~financial ~~managed~~condition, ~~such~~ asresults ~~our~~of ~~ability~~operations ~~to:~~or reputation.

●If technologies ~~maintain~~designed anto ~~easy~~block ~~and~~the ~~reliable~~display ~~user~~of ~~experience~~advertisements asare ~~user~~adopted ~~preferences~~en ~~evolve~~masse, ~~and~~or asif ~~our~~web ~~brands~~browsers ~~expand~~limit ~~into~~or ~~new~~block ~~service~~behavioral ~~categories~~targeting technologies ~~and~~our ~~new~~revenues ~~service~~may ~~lines;~~be adversely affected.

●Technologies have ~~remain~~been ~~relevant~~developed, and will likely continue to ~~users~~be ~~who~~developed, that can ~~turn~~block tothe display of advertisements on our digital products and services. We may suffer negative consequences, including a material reduction of revenue, with mass adoption of website ad blocking technologies or other ~~providers~~technologies that limit the ability to personalize advertisements, including, without limitation, if the price for ~~digital~~this ~~content~~advertising inventory declines. We generate substantially all of our revenue from advertising, and ~~marketplaces~~ad-blocking technologies may prevent the display of certain advertisements appearing on our platform, which could harm our business, operating results, and ~~mobile~~financial ~~games;~~condition. Existing ad-blocking technologies that have not been effective on our platform may become effective as we make certain platform changes, and new ad-blocking technologies may be developed in the future.

~~● increase brand awareness among existing and potential users, advertisers and content providers through various marketing and promotional activities;~~19

●Activities of ~~adopt~~our ~~new~~advertiser ~~technologies~~clients and/or ~~adapt~~users ~~our~~could ~~products~~damage ~~and~~our ~~services~~reputation toor ~~meet~~give ~~user~~rise ~~needs~~to orlegal ~~emerging~~claims ~~industry~~against ~~standards; and~~us.

●Our advertisers ~~distinguish~~and/or users may not comply with international or domestic laws, including, but not limited to, laws and regulations relating to mobile communications. Failure of our advertisers and/or users to comply with laws or our policies could damage our reputation and expose us to liability under these laws. We may also be liable to third parties for content in the advertisements or content we deliver or distribute if the artwork, text or other content involved violates copyrights, trademarks or other intellectual property rights of third parties or if the content is defamatory, unfair and deceptive, or otherwise in violation of applicable laws. Although we generally receive assurance from our advertising partners and users that their advertisements and content, respectively, are lawful and that they have the ~~competition~~right to use any copyrights, trademarks or other intellectual property included in an advertisement or content, and ~~maintain~~although we ~~this~~are ~~distinction~~normally indemnified by the advertisers, a third party or regulatory authority may still file a claim against us. Any such claims could be costly and time consuming to defend and could also hurt our reputation within the mobile advertising industry. Further, if we are exposed to legal liability, we could be required to pay substantial fines or penalties, redesign our business methods, discontinue some of our services or otherwise expend significant resources.

~~In the future, we may conduct various marketing~~We ~~and brand promotion activities to expand our brand. Some of these~~ may ~~require~~not ~~material investment. We cannot assure you, however, that these activities will~~ be ~~successful or that we will be~~ able to ~~achieve~~continually ~~the~~meet ~~brand~~our ~~promotion~~users’ ~~effect~~expectations weand ~~expect.~~retain Inor ~~addition,~~expand ~~any~~our ~~negative publicity~~user inbase, ~~relation~~and to our ~~mobile internet products~~revenues, ~~websites~~profitability and orprospects ~~services~~may ~~could~~be ~~harm~~materially ~~our brand~~ and ~~reputation~~adversely affected.

WeAlthough we ~~have~~constantly ~~received,~~monitor and ~~expect~~research toour ~~continue~~users’ expectations, we may be unable to ~~receive,~~meet them on an ongoing basis or anticipate future ~~complaints~~user ~~from~~needs. ~~users~~A ~~regarding~~decrease in the ~~quality~~number of users engaging with our products and services. Ifmay ~~our~~have ~~users’~~a ~~complaints~~material ~~are~~and ~~not~~adverse ~~addressed~~effect on our ability to ~~their~~sell ~~satisfaction~~advertising, ~~our~~ ~~reputation~~digital goods and ~~our~~resources, ~~market~~and ~~position~~subscriptions ~~could~~and beon ~~significantly~~our ~~harmed~~business, ~~which~~financial ~~may~~condition ~~materially~~and results of operations. In order to attract and ~~adversely~~retain ~~affect~~users and remain competitive, we must continue to innovate our ~~business~~products and services, ~~revenues~~improve user experience, and ~~profitability~~implement new technologies and functionalities.

InThe internet ~~addition~~business is characterized by constant changes, ~~despite~~including ~~our~~but ~~ongoing~~not ~~efforts~~limited to ~~prevent violation~~rapid oftechnological ~~our~~evolution, continual shifts in user ~~guidelines~~expectations, ~~problematic~~frequent ~~content~~introductions onof ~~our~~new ~~platforms,~~products ~~including~~and ~~but~~services ~~not~~and ~~limited~~constant ~~to,~~emergence ~~low-quality~~of ~~user-generated~~new ~~content,~~industry standards and practices. ~~socially~~As ~~unacceptable~~a ~~material~~result, our users may leave us for our competitors’ products and services more quickly than in other ~~violations~~sectors. ofThus, our ~~guidelines~~success will ~~could~~depend, ~~affect~~in ~~the~~part, ~~quality~~on of our ~~services~~ability ~~and~~to ~~offerings~~respond ~~and~~to ~~the manner~~these changes in ~~which~~a ~~they~~timely ~~are~~and ~~viewed~~cost-effective bybasis, including improving and marketing our ~~users~~existing orproducts ~~potential~~and ~~users.~~services ~~This~~and ~~could~~developing ~~harm~~and ~~our~~pricing ~~reputation~~new products and ~~negatively~~services ~~impact~~in response to evolving user ~~participation~~needs. Our ability ofto successfully retain or expand our ~~various~~user ~~platforms.~~base will depend on our ability to achieve the following, among others:

~~RISKS~~● ~~RELATED~~anticipate TOand ~~FINANCIAL~~effectively ~~AND~~respond ~~ACCOUNTING~~to ~~MATTERS~~the growing number of internet users in general and our users in particular;

~~Our~~● ~~limited~~attract, ~~operating~~retain ~~history~~and ~~makes~~motivate ittalent, ~~difficult~~ including but not limited to ~~evaluate~~application ~~our~~developers, ~~business~~visual ~~with~~designers, ~~past~~product ~~results~~and ~~not~~program ~~necessarily~~managers ~~being~~and ~~indicative~~engineers ~~for~~who ~~future~~have ~~operating~~experience ~~results~~developing ~~and~~consumer ~~may~~facing ~~increase~~digital ~~your~~products ~~investment risk.~~or other mobile internet products and services;

We● ~~have~~effectively ~~only~~market ~~a limited operating history, especially with respect to Emojipedia and GuruShots, upon which you can evaluate~~ our ~~business~~existing and ~~prospects.~~new ~~Although~~products ~~we experienced impressive year-over-year revenue growth of 36%~~ and ~~107%~~services in ~~fiscal~~response ~~2022 and 2021 respectively, our growth in fiscal 2020 was moderate and even declined in fiscal 2019. Impacting the growth figures in fiscal 2023 as compared~~ to fiscal 2024 is the inclusion of GuruShots for all of fiscal 2023 as compared to only the final three and a half months of fiscal 2022. We have encountered and will encounter risks and difficulties frequently experienced by early-stage companies in rapidly evolving ~~industries,~~user ~~like mobile apps, digital marketplaces and gaming, including the need to:~~needs;

● ~~accurately~~develop ~~forecast~~in ~~our~~a ~~revenue~~timely fashion and ~~plan~~launch ~~our~~new ~~operating~~products ~~expenses~~and features, and develop and launch other internet products cost-effectively;

19● funnel our existing users and prospects into new products that we develop, independent of our current product suite, and convert them into recurring users of these new products;

● ~~hire~~successfully recruit new users, ~~integrate~~artists, individual creators and ~~retain~~brands ~~key~~that ~~personnel~~offer their content to our users;

● ~~successfully~~further ~~integrate~~improve our platform to provide a compelling and ~~realize~~optimal ~~the~~user ~~benefits~~experience through integration of ~~the~~products ~~acquisitions~~and ~~that~~services weprovided ~~have~~by ~~made~~existing and new third-party developers or business partners; and

● ~~develop~~continue ato ~~scalable~~provide ~~technology~~quality ~~infrastructure~~content ~~that~~to ~~can~~attract ~~efficiently~~ and ~~reliably~~retain ~~address~~our ~~increased~~users ~~usage, as well as new features~~ and ~~services;~~advertisers.

●We cannot ~~comply~~assure ~~with~~you that our existing products and services, will remain sufficiently popular with our users. We may be unsuccessful in adding compelling new ~~laws~~features and ~~regulations~~enhancements; ~~applicable~~products and services to further diversify these product offerings. Unexpected technical, commercial or operational problems could delay or prevent the introduction of one or more of our new products or services to our users. Moreover, we cannot be sure that any of our new products and services will achieve widespread market acceptance or generate incremental revenue the way our existing products and services have. If we fail in earning user satisfaction through our products or services or if our products and services fail to meet our expectation to maintain and expand our user base, our business;, results of operations and financial condition will be materially and adversely affected.

~~● anticipate and effectively respond to the global economy and the markets in which we operate;~~20

●Zedge Premium, ~~establish~~the ~~and~~section ~~expand~~of our ~~various~~marketplace ~~digital~~where ~~brands;~~we offer premium content (i.e., for purchase), may not yield the strategic goals and objectives that we envision.

●Although we ~~maintain~~believe that Zedge Premium will act as an important driver in helping our ~~reputation~~platform become a leading platform for professional artists, individual creators and ~~build~~brands ~~trust~~looking ~~with~~to ~~users~~distribute their work to consumers looking for an easy, ~~artists~~entertaining and unique way to express their voice, ~~advertisers~~individuality and ~~employees;~~essence, it’s premature to conclude this as being the case.

●Although Zedge ~~offer~~Premium’s ~~competitive~~gross ~~economics~~transaction revenue has shown impressive growth it is still too early to ~~advertisers~~state ~~and~~with ~~users~~conviction ~~alike;~~that Zedge Premium will have a materially positive impact on our business. In order to do so, we still need, among other things, to:

● ~~maintain~~successfully ~~and~~market ~~expand~~the ~~revenue~~recently-launched ~~producing~~web-based ~~initiatives~~offering ~~including~~to adboth ~~sales,~~creators ~~in-app purchases~~ and ~~subscriptions~~consumers;

● ~~deliver~~expand ~~superior~~the ~~experiences~~digital ~~and~~content ~~results~~types ~~for~~we ~~users,~~offer ~~artists~~to ~~and~~include ~~advertisers~~more ~~alike~~types of creators;

● ~~identify~~continue to ensure that we build best-of-breed tools for Zedge Premium content creators that, ~~attract~~amongst other things, ~~retain~~meet their needs and ~~motivate~~properly ~~new~~address ~~users~~marketing, ~~and~~distribution, ~~artists;~~monetization, reporting, support, and ease of use;

● ~~manage~~continue ~~our~~to ~~expanding~~develop ~~operations.~~a wide array of monetization mechanisms Zedge Premium creators in order to optimize revenue generation;

If● wecontinue doevolving ~~not~~exclusive, ~~successfully~~limited ~~address~~edition ~~any~~digital orcontent ~~all~~functionality ~~of these~~that ~~risks,~~meets ~~our~~the ~~business,~~needs ~~revenues~~of ~~and~~both ~~profitability~~creators ~~could~~and ~~be materially adversely affected.~~consumers;

~~Although~~● wesuccessfully ~~had~~market ~~positive~~Zedge ~~cash~~Premium ~~flow~~to ~~from~~the ~~operating activities~~creative ~~fiscal~~community ~~2023~~ and ~~2024,~~secure wetheir ~~had~~adoption ~~previously~~as ~~incurred,~~a ~~and~~must-have ~~may once again incur, net losses and experience negative cash flow from operating activities~~ in ~~the~~their ~~future~~omnichannel ~~and~~distribution ~~may not be able to obtain additional capital in a timely manner or on acceptable terms, or at all.~~mix;

~~Our~~● ~~net~~establish ~~loss~~that inZedge ~~fiscal~~Premium ~~2024~~can was $9.2 million, our net loss in fiscal 2023 was $6.1 million. Our ability to maintain profitability and positive cash flow from operating activities depends on various factors, including but not limited to, the acceptance of our products and services by mobile phone and internet users, the growth and maintenance of our user base, user acquisition spend and associated return, our ability to maintain existing and obtain new advertisers, our ability to grow our revenues, the success of each of our digital brands as measured by their respective key performance indicators, the effectiveness of our new product initiatives, selling and marketing activities as well as control our costs and expenses. We may not be ~~able~~valuable to ~~sustain~~a ~~profitability or positive cash flow from operating activities, and any such positive cash flow may not be~~ sufficient tonumber ~~satisfy our anticipated capital expenditures and other cash needs. As such, we may not be able to fund our operating expenses and expenditures out~~ of ~~cash~~creators ~~flows, which would require us to utilize debt or equity financing which we may not be able to secure or which we may only secure on terms that are not favorable, which may result~~ in ~~significant~~achieving ~~dilution~~their ormarketing ~~voluntary or involuntary dissolution or liquidation proceeding of us~~ and amonetization ~~total~~objectives; ~~loss of your investment.~~and

~~Changes~~● incontinue ~~accounting~~to ~~principles~~offer oran ~~their~~excellent ~~application could~~and ~~result~~differentiated consumer experience in ~~accounting~~Zedge ~~charges~~Premium, orincluding ~~effects~~all ~~which~~end-user ~~could~~facing ~~adversely~~attributes ~~affect~~ranging ~~our~~from ~~operating~~the ~~results~~user ~~and~~interface ~~prospects~~to customer support.

~~We prepare consolidated financial statements in~~If ~~accordance~~Zedge ~~with~~Premium ~~accounting~~fails ~~principles generally accepted in the United States. The accounting for our business is subject~~ to ~~change~~yield ~~based on how~~ the ~~business~~strategic ~~model~~goals ~~evolves, interpretation of various accounting principles, enforcement of existing or new regulations,~~ and ~~changes in~~objectives ~~policies,~~that ~~rules,~~we ~~regulations~~envision, ~~and interpretations, of accounting and financial reporting requirements of the SEC or other regulatory agencies. A change in any of these principles or in their interpretations or application to~~ our business, ~~may have a significant effect on our reported~~ results, as well as our processes and related controls, and may retroactively affect previously reported periods, which may negatively impact our financial statements our business prospects. It is difficult to predict the impact of ~~future changes to accounting principles and accounting policies over financial reporting, any of which could adversely affect our results of~~ operations and financial condition will ~~and~~be ~~could~~materially ~~require significant investment in systems~~ and ~~personnel~~adversely affected.

20We may fail to develop popular new features or expand into new verticals, successfully, negatively impacting our ability to attract new users or retain existing users, which could negatively impact our business, financial condition, and result of operations.

~~If our estimates or judgments relating to our~~We ~~critical~~operate ~~accounting~~in ~~policies~~a ~~are~~highly ~~based~~competitive onindustry ~~assumptions~~with ~~that~~low ~~change~~barriers ~~or prove~~ to ~~be incorrect~~entry, and our ~~operating~~failure ~~results~~to ~~could~~compete ~~suffer~~effectively, ~~and~~particularly ~~lower the~~with ~~expectations~~our ~~of equity analysts and investors~~AI-based offerings, ~~resulting~~could inadversely aaffect ~~decline~~our inbusiness ~~the~~and ~~market~~results ~~price~~ of ~~our common stock~~operations.

~~Our preparation of financial statements in conformity~~The ~~with~~industry ~~generally~~for ~~accepted~~digital ~~accounting~~content ~~principles~~and inAI-based ~~the~~offerings, ~~United~~including ~~States~~mobile ~~requires~~personalization, usemoji tocontent, ~~make certain estimates~~ and ~~assumptions~~photo ~~that~~competition ~~affect the~~platforms, ~~reported~~is ~~amount~~intensely ofcompetitive ~~assets~~with ~~and~~low ~~liabilities~~barriers ~~and~~to ~~the~~entry. ~~disclosure~~We ofcompete ~~contingent~~with ~~liabilities~~a asdiverse range of ~~the~~entities, ~~date~~from oflarge ~~the~~media ~~financial~~companies ~~statements~~ and established ~~the~~online ~~reported~~marketplaces ~~amount~~to ofemerging ~~revenues~~startups and ~~expenses~~generative ~~during~~AI ~~the~~providers ~~reporting~~offering ~~period.~~content ~~For~~creation, ~~example~~licensing, weand ~~make~~personalization ~~certain assumptions about the interpretation~~tools. ofCompetitors ~~these~~include ~~principles~~stock ~~and~~content ~~accounting~~suppliers, ~~treatment~~providers of ~~our~~free ~~useful~~or ~~lives~~low-cost ofimagery ~~tangible~~ and ~~intangible assets~~music, ~~fair~~social ~~value~~media ~~of contingent consideration~~platforms, and ~~allowance~~AI-driven ~~for~~content creation ~~credit losses~~services. IfKey ~~these~~competitive ~~assumptions~~factors ~~turn~~include ~~out~~the toquality, ~~be incorrect~~relevance, ~~the~~and ~~outcomes~~breadth ~~may~~of becontent; ~~materially~~effectiveness ~~higher~~of orAI ~~lower~~technologies; pricing; ~~than~~ease ~~expected for~~of ~~current~~access; and ~~future~~brand ~~periods,~~reputation. ~~which~~Many ~~could~~competitors have agreater ~~material~~financial, ~~adverse~~technical, ~~effect~~or onmarketing ~~our~~resources, ~~reported~~or ~~earnings.~~stronger brand Werecognition, ~~base~~enabling ~~estimates~~them ~~and~~to ~~assumptions on~~innovate ~~historical~~faster ~~experience,~~or ~~research,~~offer ~~and~~more onattractive ~~other~~pricing ~~factors~~and ~~that~~terms ~~we believe~~ to beusers ~~reasonable~~ and incontent ~~accordance~~creators. ~~with~~Low ~~generally accepted accounting~~barriers ~~principles~~to inentry ~~the~~allow ~~United~~new ~~States,~~entrants ~~the~~to ~~results~~quickly ofdevelop ~~which~~platforms ~~form~~that ~~the~~could ~~basis~~divert ~~for~~users ~~making~~and ~~judgments~~creators ~~about~~from ~~the~~our ~~carrying~~offerings, ~~values~~such ofas ~~assets,~~Zedge ~~liabilities,~~Premium ~~equity, revenue~~ and ~~expenses~~pAInt, ~~that~~by ~~are~~providing ~~not~~easier ~~accessible~~submission ~~from~~processes, ~~alternative~~higher ~~sources.~~royalties, Weor ~~also~~exclusive ~~may~~distribution ~~make~~incentives. ~~estimates~~Additionally, ~~regarding~~advancements in ~~activities~~generative ~~for~~AI ~~which the~~could ~~accounting~~render ~~treatment~~our iscontent ~~still~~or ~~evolving.~~tools ~~Actual~~less ~~results~~competitive ~~may~~if ~~differ~~competitors ~~from~~deploy ~~those~~superior ~~estimates~~AI-driven solutions. IfIncreased ~~our~~competition, pricing ~~assumptions~~pressures, ~~change~~ or iffailure ~~actual~~to ~~circumstances differ~~meet ~~from~~user ~~our~~and ~~assumptions,~~creator ~~our~~expectations ~~operating~~could ~~results~~reduce ~~may~~our bemarket ~~adversely~~share, ~~affected~~lower ~~and~~margins, ~~could~~or ~~negatively~~limit ~~impact investors~~growth, ~~resulting~~materially harming inour abusiness, ~~decline in~~financial ~~the~~condition, ~~market~~and ~~price~~results of ~~our common stock~~operations.

Changes in tax laws, tax rates or tax rulings, or the examination of our tax positions, could materially affect our financial condition, effective tax rate, future profitability and results of operations.21

~~Tax~~Our efforts ~~laws~~to ~~may~~develop ~~change as new laws are passed~~ and ~~new~~ ~~interpretations~~expand ofour ~~the~~content ~~law~~licensing ~~are~~business ~~issued~~exposes orus ~~applied.~~to ~~Our~~a ~~existing~~number ~~corporate~~of ~~structure~~risks ~~and intercompany arrangements have been implemented in a manner~~ that wecould ~~believe~~limit ~~comply~~our ~~with~~ability ~~current~~to ~~prevailing tax laws. However~~grow, ~~the tax positions that we take advantage of could be undermined~~achieve ~~due~~commercial ~~to changing tax laws~~success, ~~both in the United States~~ and inmaintain ~~other~~our ~~applicable jurisdictions~~overall, ~~including Norway~~business, ~~Lithuania,~~results ~~and~~of ~~Israel. In addition~~operations, ~~the tax authorities in the United States~~ and ~~other~~financial ~~jurisdictions~~condition. inContributors ~~which~~may wechoose ~~operate~~not ~~regularly examine income and other tax~~to ~~returns~~provide ~~and~~their wecontent ~~expect~~for ~~that~~licensing ~~they~~purposes, ~~may~~which ~~examine~~could ~~our~~prevent ~~income~~us ~~and~~from ~~other~~scaling ~~tax returns. The ultimate outcome of these examinations may not benefit~~ our licensing business.

~~Our~~The success ~~effective~~of ~~tax~~our ~~rate~~licensing ~~for~~business ~~fiscal~~depends ~~2024~~in ~~was~~part ~~19.3% compared~~on ~~with~~contributors ~~7.0%~~agreeing ~~for~~to ~~fiscal~~make ~~2023.~~their Incontent ~~general~~available for licensing, ~~changes~~including through opt-in ~~applicable~~mechanisms ~~U.S.~~across ~~federal~~our ~~and~~platforms ~~state~~such as Zedge Premium and ~~foreign~~GuruShots. ~~tax~~Contributors ~~laws~~may ~~and~~decline ~~regulations~~to opt-in for licensing because of concerns over compensation, exclusivity, loss of control, or how their ~~interpretation~~content ~~and~~may ~~application~~be used by third parties, such as for commercial applications including training AI systems. If we cannot secure sufficient contributor participation, the ~~possibility~~breadth, diversity, and quality of ~~retroactive~~our ~~effect~~licensing catalog may be inadequate, ~~could~~which ~~affect~~would materially limit our ~~tax~~ability ~~expense~~to generate revenue from licensing activities and harm our overall growth prospects.

~~Over the last several years, the Organization~~Our ~~for~~licensing ~~Economic~~catalog ~~Cooperation~~may ~~and~~not ~~Development~~contain (the ~~“OECD”)~~types ~~has been working on a Base Erosion and Profits Shifting Project that would change various aspects~~ of ~~the~~content ~~existing~~prospective ~~framework~~licensors ~~under~~seek, which ~~our~~could ~~tax~~limit ~~obligations~~demand are determined in many of the countries in which we operate. In this regard, the OECD has proposed policies aiming to modernize global tax systems, including a country-by-country 15% minimum effective tax rate (“Pillar Two”) for ~~multinational companies. Numerous countries have enacted, or are in the process of enacting, legislation to implement the Pillar Two model rules with a subset of the rules becoming effective during~~ our ~~fiscal~~licensing ~~year ending July 31, 2025, and the remaining rules becoming effective for our fiscal year ending July 31, 2026, or in later periods~~business. At this point in time, we do not expect material tax impacts associated with Pillar Two rules in the countries where we operate for the fiscal year ending July 31, 2025. As these rules continue to evolve with new legislation and guidance, we will continue to monitor and account for the enactment of Pillar Two rules in the countries where we operate, and the potential impacts such rules may have on our effective tax rate and cash flows in future years.

~~Effective January 1, 2022, pursuant to the Tax~~The ~~Cuts~~success ~~and~~of ~~Jobs~~our ~~Act~~content oflicensing ~~2017,~~business ~~R&D~~depends ~~expenses~~on ~~are~~our ~~required~~ability to bemaintain ~~capitalized~~a ~~and~~catalog ~~amortized~~of ~~for~~content USthat ~~tax~~meets ~~purposes, which has delayed~~ the ~~deductibility of~~specific ~~these expenses~~ and ~~potentially~~evolving needs ~~increase the amount~~ of ~~cash~~prospective ~~taxes~~licensors, weincluding ~~paid~~e-commerce ~~during~~vendors, ~~the~~stock ~~years~~photo ~~ended July 31~~libraries, ~~2024~~ and ~~2023.~~companies Inseeking ~~the~~datasets ~~future, among~~to ~~other~~train ~~things,~~AI ~~Congress~~models. If ~~may~~our ~~consider~~catalog ~~legislation~~is ~~that~~too ~~would~~limited ~~defer~~in ~~the~~subject ~~capitalization requirement to later years or eliminate the capitalization requirement~~matter, ~~possibly with retroactive effect~~quality, ~~and/~~or ~~the~~format, ~~IRS~~licensors may ~~issue~~choose ~~guidance~~to onobtain ~~the~~content ~~currently~~from ~~enacted~~other ~~tax~~providers ~~law~~or ~~which~~develop ~~differs~~their ~~from~~own ~~our interpretation~~sources. ItA ismismatch ~~possible~~between ~~that~~available ~~the~~content ~~enactment of new legislation~~ and~~/or~~ ~~issuance~~market ofdemand ~~IRS guidance~~ could ~~have~~diminish aour ~~material effect~~licensing onbusiness’s viability, harm our ~~financial condition~~reputation, ~~results~~and ofnegatively ~~operations~~impact user engagement and ~~cash~~revenue ~~flows~~across inour ~~future~~broader ~~periods~~ecosystem.

21Challenges in delivering “content-on-demand” could undermine our ability to secure or generate the content that prospective licensors require.

We aim ~~are~~to ~~exposed~~provide prospective licensors the ability to ~~fluctuations~~request content through on-demand generation tools, by engaging our contributor community, or by finding other methods of securing rights to content or development of content that we own. However, there is no assurance that we can fulfill such requests at the required scale, quality, or within the necessary timeframe due to limitations in ~~foreign~~our ~~currency~~technology, ~~exchange~~contributor ~~rates~~base, or compliance with regulatory requirements. If we are unable to deliver requested content, or if generated content raises intellectual property, authenticity, or ethical concerns, prospective licensors may elect not to engage with us. This could harm our reputation and limit the growth and sustainability of our licensing business.

~~We have significant operations in Europe and Israel~~Dependence ~~that~~on are denominated in foreign currencies, primarily the Norwegian Krone, Euro and Israeli Shekel, subjecting us to foreign currency risk. The strengthening or weakening of the U.S. Dollar versus these currencies impacts the expenses generated in these foreign currencies when converted into the U.S. Dollar. In fiscal 2024 and fiscal 2023, we recorded a ~~loss~~limited ofnumber ~~$190,000 and a gain~~ of ~~$36,000,~~prospective ~~respectively, from~~licensing ~~foreign~~partners ~~currency~~could ~~movements~~restrict ~~relative~~our togrowth ~~the U.S. Dollar. Included in these amounts were losses from hedging activities of $245,000~~ and ~~gains of $14,000 in fiscal 2024 and fiscal 2023, respectively~~profitability. While we regularly enter into transactions to hedge portions of our foreign currency exposure, it is impossible to predict or eliminate the effects of this exposure. Fluctuations in foreign exchange rates could significantly impact our financial results.

Our content licensing business may initially rely on a relatively small number of potential licensing partners. The market for such content is novel and unproven, and revenue depends on a few partners, with no assurance of additional orders, renewals or favorable terms. We may fail to meet contractual obligations, such as API performance requirements, or prevent unauthorized use of our content by third parties, which could require costly enforcement efforts. Regulatory or market factors may reduce the value of AI training content, and failure to prevent partner misuse could harm our reputation. If we fail to ~~implement~~establish ~~and~~or maintain anthese ~~effective~~relationships, or if prospective licensors ~~system~~reduce ofor ~~internal~~discontinue ~~controls~~their ~~over~~reliance ~~financial~~on ~~reporting~~third-party content providers, weour ~~may~~ability to scale and sustain our licensing business could be ~~unable~~significantly toimpaired. ~~accurately~~Because ~~report~~these partners may have substantial bargaining power, they may also impose unfavorable terms that reduce our ~~results~~margins ofor ~~operations~~restrict our flexibility. As a result, ~~meet~~there can be no assurance that our ~~reporting obligations~~licensing business will achieve or ~~prevent~~sustain commercial ~~fraud~~success.

Under Section 404 of the Sarbanes-Oxley Act of 2002, we are required to include a report of management on our internal control over financial reporting in our annual report on Form 10-K. In addition, should we become an accelerated filer, our independent registered public accounting firm must attest to and report on the effectiveness of our internal control over financial reporting. Our management may conclude that our internal control over financial reporting is not effective. Moreover, even if our management concludes that our internal control over financial reporting is effective, our independent registered public accounting firm, after conducting its own independent testing, may issue a report that is qualified if it is not satisfied with our internal controls or the level at which our controls are documented, designed, operated or reviewed, or if it interprets the relevant requirements differently from us. In addition, our reporting obligations may place a significant strain on our management, operational and financial resources and systems for the foreseeable future. We may be unable to timely complete our evaluation testing and any required remediation.22

~~During the course of documenting and testing our~~If ~~internal control procedures, in order to satisfy the requirements of Section 404,~~ we ~~may identify weaknesses and deficiencies in our internal control over financial reporting. In addition, if we~~ fail to maintain ~~the~~and ~~adequacy~~enhance of our ~~internal~~various ~~control over financial reporting~~brands, ~~as these standards are modified, supplemented~~ or ~~amended~~if ~~from time to time,~~ we ~~may~~incur ~~not~~excessive beexpenses ~~able to conclude on an ongoing basis that we have effective internal control over financial reporting~~ in ~~accordance~~this ~~with Section 404. If we fail to achieve and maintain an effective internal control environment~~effort, ~~we could suffer material misstatements in~~ our ~~financial statements and fail to meet our reporting obligations~~business, and we may be required to restate our financial statements from prior periods, any of which would likely cause investors to lose confidence in our reported financial information. This could in turn limit our access to capital markets, harm our results of operations, and ~~lead to~~prospects amay ~~decline~~be inmaterially ~~the~~and ~~trading~~adversely ~~price of our stock~~affected.

~~Additionally,~~We believe ~~ineffective~~that ~~internal~~maintaining ~~control~~and ~~over financial~~enhancing ~~reporting~~our ~~could~~various ~~expose~~digital usbrands and associated reputation is important to ~~increased~~the ~~risk~~success of ~~fraud~~our orbusiness. Historically, ~~misuse~~we ofhave ~~corporate~~not ~~assets~~made ~~and~~material ~~subject~~investments usin tothis ~~potential~~effort. ~~delisting~~We ~~from~~believe that a well-recognized and respected brand is important to increasing the ~~stock~~number ~~exchange~~of onusers ~~which~~and weenhancing ~~list~~our attractiveness to users, ~~regulatory~~artists, ~~investigations~~advertisers and ~~civil~~business orpartners. ~~criminal~~Brand ~~sanctions~~recognition and enhancement may directly affect our ability to maintain our market position.

~~RISKS~~Many factors, ~~RELATED~~some TOof ~~OUR~~which ~~OPERATIONS~~are beyond our control, are important to maintaining and enhancing our various brands and may negatively impact our brand and reputation if not properly managed, such as our ability to:

We● ~~may~~maintain ~~not~~an beeasy ~~able~~and toreliable ~~effectively~~user ~~manage~~experience ~~our growth~~as oruser ~~implement~~preferences ~~our~~evolve ~~future~~and ~~business~~as ~~strategies, in which case~~ our ~~business~~brands ~~and~~expand ~~results~~into ofnew ~~operations~~service ~~may~~categories beand ~~materially~~new ~~and~~service ~~adversely affected.~~lines;

~~Our~~● ~~continued~~remain ~~success~~relevant ~~depends~~to onusers ~~our~~who ~~ability~~can turn to ~~effectively~~ ~~and~~other ~~efficiently~~providers ~~grow~~for ~~each~~digital ofcontent ~~the~~and ~~properties~~marketplaces inand ~~our~~mobile ~~brand portfolio.~~games;

We● may not be capable of growing our business organically or with paid marketing campaigns, attract new players and artists and/or establish cooperation with strategic partners. Our business has experienced periods of rapid growth and expansion that has placed, and continues to place, significant strain on our management and resources. We cannot assure you that these periods will recur or be sustainable. We have also acquired other companies and made asset purchases and integrating those into Zedge has placed and continues to place significant strain on management and resources. We believe that continued growth of our business will depend on our ability to successfully develop and enhance our products and services, cost efficiently attract new artists and individual creators, maintain our relationship with various artists and content partners like Google, Meta and Apple, sustain our high rankings with the leading search engines including Google, capture the changes that are taking place in the industry in a timely fashion grow our user base at a cost effective rate, retain existing users, continue developing innovative technologies in response to user demand, increase brand awareness ~~through~~among ~~marketing~~existing and ~~promotional~~potential ~~activities~~users, ~~react to changes in market trends, expand into new market segments, attract new~~ advertisers, ~~retain existing advertisers, get users to engage with our digital properties~~ and ~~convert into~~content ~~paying~~providers ~~users~~through orvarious ~~subscribers,~~marketing and ~~take~~promotional advantage of the growth in the relevant markets. We cannot assure you that we will achieve any or all of the above. In the event that we are not successful in some or all of these areas we may not be able to retain our customers and advertisers.activities;

22● adopt new technologies or adapt our products and services to meet user needs or emerging industry standards;

We● ~~need~~distinguish tous ~~invest~~from inthe ~~paid~~competition ~~user~~and ~~acquisition~~maintain ~~in order~~this todistinction; grow our customer base. However, we may not be able to secure new users at scale with a positive return on investment. Even if we can secure new profitable customers these customers may not mature into sustainable long-term customers.and

To● ~~manage~~address ~~our~~ethical ~~growth~~concerns ~~and~~related ~~for~~to usour touse ~~attain~~of ~~and maintain~~AI ~~profitability~~technologies, weparticularly ~~will~~if ~~also~~users ~~need~~perceive toAI-driven ~~further~~decisions ~~expand,~~as ~~train,~~opaque ~~manage~~or ~~and~~unfair, ~~motivate~~which ~~our~~could ~~workforce~~harm ~~across multiple geographies and manage~~ our ~~relationships~~brand ~~with users, consultants, business partners~~ and ~~advertisers~~user ~~globally~~trust. WePublic ~~anticipate~~scrutiny ~~that we will need to implement a variety of enhanced~~ and ~~upgraded~~negative ~~operational~~perceptions ~~and~~regarding ~~financial systems, procedures and controls, including the improvement of~~ our ~~accounting and~~AI ~~other~~deployment ~~internal~~could ~~management~~necessitate ~~systems.~~costly ~~All~~transparency ofmeasures ~~these endeavors involve risks~~ and ~~will~~proactive ~~require~~ethical ~~substantial~~governance ~~management~~to ~~efforts~~mitigate ~~and~~reputational ~~skills and additional expenditures~~risks.

~~Our~~In the ~~products~~future, ~~currently~~we ~~enjoy~~may aconduct ~~global~~various ~~customer base.~~marketing ~~This~~and ~~geographic~~brand ~~diversity~~promotion ~~may~~activities ~~raise~~to ~~the~~expand ~~level~~our ofbrand. ~~difficulty~~Some inof ~~managing~~these ~~future~~may ~~growth~~require ~~and~~material ~~profitability~~investment. We cannot assure you ~~that our current and planned personnel~~, ~~systems~~however, ~~procedures~~that ~~and~~these ~~controls~~activities will be ~~adequate~~successful toor ~~support our future operations. In addition, we cannot assure you~~ that we will be able to ~~effectively~~achieve ~~manage~~the ~~our~~brand ~~growth~~promotion oreffect we ~~implement~~expect. ~~our~~In ~~future~~addition, ~~business~~any ~~strategies~~negative ~~effectively,~~publicity ~~and~~in ~~failure~~ relation to doour somobile ~~may~~internet ~~materially~~products, ~~and~~websites ~~adversely~~or ~~affect~~services ~~our~~could ~~business~~harm our brand and ~~results of operations~~reputation.

~~During~~We have ~~the past five years~~received, weand ~~have~~expect ~~experienced a~~to ~~shift~~continue into ~~our~~receive, ~~Zedge~~complaints ~~App’s~~from ~~regional~~users ~~customer~~regarding ~~make-up with~~ the ~~portion~~quality of our ~~total~~products ~~MAU from emerging markets increasing,~~ and ~~the portion from well-developed markets decreasing~~services. InIf ~~Q4 of fiscal 2024,~~ our ~~Zedge App’s~~ users ~~in emerging markets declined by 15%~~’ ~~while~~complaints ~~its~~are ~~users~~not inaddressed ~~well-developed regions declined 19% when compared~~ to ~~fiscal~~their ~~2023.~~satisfaction, ~~India~~our ~~comprised~~reputation ~~30%~~and of our ~~MAU~~market asposition ofcould ~~July~~be 31significantly harmed, ~~2024. This~~which ~~shift~~may ~~has negatively impacted revenues because well-developed markets command~~ materially ~~higher advertising rates when compared to~~ ~~those~~and inadversely ~~emerging~~affect ~~markets.~~our ~~Although we are investing in reversing this trend~~business, ~~we may not be successful in this effort which may result in lower~~ revenues and profitability.

In ~~2021~~ addition, ~~Apple~~despite ~~released~~our ~~iOS~~ongoing 14efforts ~~which started requiring users~~ to ~~opt~~prevent inviolation ~~to share their identifier for advertisers IDFA with app developers. Apple’s IDFA is a unique string~~ of ~~alphanumeric characters~~our ~~assigned~~user toguidelines, ~~Apple~~problematic ~~devices~~content ~~which~~on ~~advertisers~~our ~~use~~platforms, toincluding ~~identify app users in order to deliver personalized and targeted advertising.~~but ~~According~~not tolimited ~~Statista~~to, ~~the~~low-quality ~~worldwide opt~~user-ingenerated ~~rate enabling app tracking after the release of iOS 14 was less than 25%. As a consequence~~content, ~~the~~ ~~ability~~socially ofunacceptable ~~advertisers to accurately target~~material, ~~measure~~ and ~~optimize their advertising campaigns at the user level has become significantly more difficult typically resulting in higher user acquisition costs. Further,~~ other ~~companies~~violations ~~upon whom the industry depends to identify potential users such as Google may implement similar changes with respect to its Android operating system. The longer-term impact~~ of ~~these changes on the overall mobile advertising ecosystem,~~ our ~~competitors,~~guidelines ~~our~~could ~~business, and~~ affect the ~~developers,~~quality ~~partners,~~of ~~and advertisers within~~ our ~~community~~services ~~remains uncertain,~~ and ~~depending~~offerings ~~on how we, our competitors,~~ and the ~~overall~~manner ~~mobile~~in ~~advertising~~which ~~ecosystem~~they ~~adjusts,~~are ~~and~~viewed ~~how~~ by our ~~partners,~~users ~~advertisers,~~or ~~and~~potential users. ~~respond,~~This ~~our business~~ could beharm ~~seriously harmed. If we are unable to mitigate or respond to these and future developments, and alternative solutions do not become widely adopted by~~ our ~~advertisers, then targeting, measurement, and optimization~~ ~~capabilities~~reputation ~~will be materially~~ and ~~adversely~~negatively ~~affected,~~impact ~~which~~user ~~would~~participation inof ~~turn negatively impact~~ our ~~advertising~~various ~~revenue~~platforms.

Our products ~~may~~face ~~contain~~competition ~~errors,~~in ~~flaws~~all oraspects ~~failures that~~of ~~may only become apparent after~~ their ~~release~~business. ~~From~~If ~~time to time, we receive user feedback in connection with errors, flaws or failures and such errors, flaws or failures may also come to~~ our ~~attention~~apps ~~during~~fail ~~our internal testing process. We generally have been able~~ to ~~resolve~~ ~~such~~compete ~~errors,~~effectively ~~flaws~~ or ~~failures~~if intheir areputation ~~timely~~is ~~manner~~damaged, our ~~but~~business, wefinancial ~~cannot~~condition ~~assure you that we will be able to detect~~ and ~~resolve~~results ~~all~~ of ~~them~~ ~~effectively~~operations ~~or in a timely manner. Errors, flaws or failures in our services and products~~ may ~~adversely~~be ~~affect user experience and cause our users to stop using our services and products, which could~~ materially and adversely ~~affect our business and results of operations~~affected.

23Although our products are leaders in their specific verticals, including mobile phone personalization, emoji related content and information, and digital photo competitions, we cannot guarantee that our brands will be able to maintain their leadership position. Our products face potential competition from other internet companies, app developers and smartphone manufacturers, and new market entrants may also emerge. AI models used by competitors may produce biased or discriminatory outcomes if not properly managed, potentially giving us a competitive advantage if we effectively address algorithmic bias through robust data curation, model evaluation, and fairness measures; however, failure to do so could result in unfair treatment of users or creators, violating anti-discrimination laws and damaging our brand reputation, thereby harming our competitive position. If we are not able to differentiate our products from that of our competitors, drive value for our customers, and/or effectively align our resources with our goals and objectives, we may not be able to compete effectively against our competitors. Our failure to compete effectively against any of the foregoing competitive threats could materially and adversely harm our business. Increased competition may result in new products and offerings which may in turn require us to take actions to retain and attract our users and advertisers in such a fashion which would lower our gross margins. If we fail to compete effectively, our market share would decrease and our results from operations, revenues and profits would be materially and adversely affected.

~~Our marketing efforts to acquire new, and retain existing, customers may not be effective or cost-efficient, and may be affected by external factors beyond our control.~~23

~~Maintaining and promoting awareness of our services~~We isare ~~important~~attempting to expand our ~~ability~~Zedge toPremium ~~attract~~marketplace ~~and~~where ~~retain~~professional ~~customers.~~artists, Weindividual ~~spend~~creators ~~a significant amount on marketing activities to acquire new customers~~ and ~~retain~~brands ~~and~~offer ~~engage~~their ~~existing customers and have plans~~ content to ~~maintain and increase that focus. For example, in 2024 and 2023~~ our ~~marketing expenses were approximately $6~~users.9 ~~million~~We ~~and~~aspire ~~$3.2~~to ~~million,~~be ~~respectively,~~a ~~and~~popular wedestination ~~expect~~that ~~our~~users ~~marketing~~turn ~~expenses~~ to ~~continue~~when tolooking ~~account~~ for a ~~significant~~high ~~portion~~quality ofdigital ~~our operating expenses~~content. ~~Our~~If ~~business~~we ~~depends~~are ~~on a high degree of app installs from the app stores and website~~unsuccessful ~~traffic,~~in ~~which~~meeting isour ~~dependent on many factors~~goal, ~~including~~our ~~the~~business ~~availability~~may ofsuffer ~~appealing~~resulting ~~website~~in ~~content~~diluting ~~and~~our ~~search~~value ~~engine optimization~~proposition, ~~affiliate marketing~~losing ~~and~~MAU ~~display advertising, as well as social media~~ and ~~email.~~having ~~The~~lower ~~marketing~~revenues ~~efforts we implement may not succeed for a variety of reasons, including our inability to execute~~ and ~~implement our plans~~profits. ~~External factors beyond our control may also impact the success of our marketing initiatives.~~

~~Our digital presence heavily depends on search~~If ~~engine~~we ~~traffic,~~are ~~primarily~~not ~~from~~able ~~platforms~~to ~~like~~effectively ~~Google.~~compete Ain ~~key~~any ~~driver~~aspect of our ~~success~~business inor ~~this~~if ~~domain is~~ our ~~website’s~~reputation ~~visibility~~is ~~and ranking~~harmed inby ~~response~~rumors toor ~~search~~allegations ~~queries.~~regarding our Asbusiness ~~search~~or ~~engines~~business ~~frequently update their algorithms~~practices, ~~affecting~~ our ~~link~~overall ~~placements~~user ~~and~~base ~~rankings we~~may ~~need~~decline, tomaking ~~regularly~~it ~~manage~~less ~~our~~attractive ~~search engine optimization in order~~ to ~~avoid~~advertisers. aWe ~~material~~may ~~decrease~~be inrequired ~~web traffic~~ to ~~our online properties.~~ ~~Substituting~~spend ~~free~~additional ~~traffic~~resources ~~with paid alternatives could also lead~~ to ~~increased~~further ~~costs.~~increase ~~These~~our ~~risks~~brand ~~highlight~~recognition ~~the~~and ~~critical~~promote ~~importance~~our ~~of continuous~~products ~~adaptation~~and toservices, ~~the evolving search engine landscape~~ and ~~the~~such ~~potential~~additional ~~consequences~~spending could ifadversely weaffect doour ~~not adequately navigate these challenges~~profitability.

~~User acquisition for our apps depends on a host~~The ofGuruShots ~~items including and especially on paid and organic app marketing initiatives. Effective and profitable user~~ acquisition relies on knowing how to optimize across each acquisition platform, data analysis, creatives, amongst other things. In addition, due to the changing nature of what data the platforms provide to publishers like Zedge may ~~result~~fail ~~in elongating testing time windows and increasing testing budgets. Taken together if we are unsuccessful in accounting for all of these items, we may be unable~~ to ~~recover~~yield ~~our~~growth ~~marketing~~opportunities ~~spend~~ and weachieve ~~may not~~beneficial acquire new customers or our cost to acquire new customers may increase, and our existing customers may reduce the frequency or size of their purchases from us, any of which could have a material adverse effect on our business, prospects, results of operations, financial condition or cash flowssynergies.

~~Our~~Zedge acquired ~~products~~GuruShots ~~face~~with ~~competition~~the inexpectation ~~all~~that ~~aspects of~~the ~~their~~transaction ~~business~~will yield growth on a standalone basis. IfTo ~~our~~date ~~apps~~this ~~fail~~has not been the case. In addition, the acquisition was meant to ~~compete~~deliver ~~effectively~~strategic orsynergies ifon a combined basis. Our success in realizing these growth opportunities and strategic synergies, and their ~~reputation~~associated istiming ~~damaged~~depends, ~~our~~amongst ~~business~~other things, ~~financial~~on ~~condition~~the ~~and~~successful ~~results~~ integration of ~~operations~~the ~~may~~respective bebusinesses. Even ~~materially~~if ~~and~~we ~~adversely~~are ~~affected~~successful with the integration, there is no guarantee that the strategic synergies that we envisioned will bear fruit.

~~Although our products are leaders in their specific~~Certain verticals, including mobile phone personalization, emoji related content and information, and digital photo competitions, we cannot guarantee that our brands will be able to maintain their leadership position. Our products face potential competition from other internet companies, app developers and smartphone manufacturers, and new market entrants may also emerge. If we are not able to differentiate our products from that of our competitors, drive value for our customers, and/or effectively align our resources with our goals and objectives, we may not be able to compete effectively against our competitors. Our failure to compete effectively against any of the foregoing competitive threats could materially and adversely harm our business. Increased competition may result in new products and offerings ~~which~~are ~~may~~sensitive ~~in turn require us~~ to ~~take~~consumer ~~actions~~spending ~~to retain~~ and ~~attract~~economic ~~our users and advertisers in such a fashion which would lower our gross margins~~conditions. ~~If we fail to compete effectively, our market share would decrease and our results from operations, revenues and profits would be materially and adversely affected.~~

WeConsumer purchases ~~are~~of ~~attempting~~discretionary toretail ~~expand~~items ~~our~~and ~~Zedge~~specialty ~~Premium~~retail products, as well as participation in gallery events, may be adversely affected ~~marketplace~~by ~~where~~national ~~professional~~and ~~artists~~regional economic, ~~individual~~market ~~creators~~and other conditions such as employment levels, salary and ~~brands~~wage ~~offer~~levels, ~~their~~the ~~content~~availability toof consumer ~~our~~credit, ~~users.~~inflation, Wehigh ~~aspire~~interest torates, behigh tax rates, high fuel prices, the threat of a ~~popular~~pandemic ~~destination~~or other health crisis and ~~that~~consumer ~~users~~confidence ~~turn~~with respect to current and future economic, market and other conditions. Consumer purchases may decline during recessionary periods or at other times when ~~looking~~unemployment ~~for~~is ~~high~~higher ~~quality~~or ~~digital~~disposable ~~content~~income is lower. IfConsumer wewillingness ~~are~~to ~~unsuccessful~~make discretionary purchases may decline, may stall or may be slow to increase due to national and regional economic conditions. There remains considerable uncertainty and volatility in ~~meeting~~the ~~our~~national ~~goal~~and global economy. Further or future slowdowns or disruptions in the economy, market and other conditions could adversely affect us and our business strategy. We may ~~suffer resulting~~not inbe ~~diluting~~able to sustain or increase our ~~value~~current ~~proposition,~~net ~~losing~~sales ~~MAU~~if ~~and~~there ~~having~~is ~~lower~~a ~~revenues~~decline in ~~and~~consumer ~~profits~~spending.

24RISKS RELATED TO FINANCIAL AND ACCOUNTING MATTERS

IfOur limited weoperating ~~are~~history ~~not~~makes ~~able~~it difficult to ~~effectively~~evaluate ~~compete in any aspect of~~ our business orwith ifpast ~~our~~results ~~reputation~~not isnecessarily ~~harmed~~being byindicative ~~rumors~~for orfuture ~~allegations regarding our business or business practices, our overall~~operating ~~user~~results ~~base~~and may ~~decline, making it less attractive to advertisers. We may be required to spend additional resources to further~~ increase ~~our~~ ~~brand~~your ~~recognition~~investment ~~and promote our products and services, and such additional spending could adversely affect our profitability~~risk.

IfWe have weonly ~~fail~~a tolimited ~~keep~~operating uphistory, especially with ~~rapid~~respect ~~technological~~to Emojipedia and GuruShots, upon which you can evaluate our business ~~changes~~and inprospects. ~~the~~Although ~~internet~~we experienced impressive year-over-year revenue growth of 36% and ~~smartphone~~107% ~~industries~~in fiscal 2022 and ~~adapt~~2021 respectively, our ~~products~~growth in fiscal 2020 was moderate and ~~services~~even ~~accordingly,~~declined ~~our~~in ~~results~~fiscal 2019. Impacting the growth figures in fiscal 2023 as compared to fiscal 2024 is the inclusion of ~~operations~~GuruShots for all of fiscal 2023 as compared to only the final three and ~~future growth~~a ~~may~~half bemonths ~~adversely~~of ~~affected~~fiscal 2022. We have encountered and will encounter risks and difficulties frequently experienced by early-stage companies in rapidly evolving industries, like mobile apps, digital marketplaces and gaming, including the need to:

~~The~~● ~~internet~~accurately ~~and~~forecast ~~smartphone industries are characterized by rapid and innovative technological changes. Our future success will depend, in part, on~~ our ~~ability~~revenue ~~to respond to fast changing technologies, adapt our products~~ and ~~services~~plan ~~to evolving industry standards and improve the performance, functionality and reliability of~~ our ~~products and~~operating services. Our failure to continue to adapt to such changes could harm our business. If we are slow to develop products and services that are compatible with smartphones, or if the products and services we develop are not widely accepted and used by smartphone users, we may not be able to capture a significant share of this important market. In addition, the widespread adoption of new internet, networking or telecommunications technologies or other technological changes for smartphones could require substantial expenditures to modify or adapt our products, services or infrastructure. If we fail to keep up with rapid and innovative technological changes to remain competitive, our future growth may be materially and adversely affected and our results of operations could be materially and adversely affected.expenses;

~~Our international operations expose us to additional risks that could harm our business, operating results and financial condition.~~24

In● ~~addition~~hire, tointegrate, ~~uncertainty about our ability to continue expanding~~ and ~~monetizing~~retain ~~internationally,~~key ~~our foreign operations may subject us to additional risks including:~~personnel;

● ~~difficulties~~successfully inintegrate ~~developing, staffing, traveling to~~ and ~~simultaneously~~realize ~~managing~~the ~~foreign~~benefits ~~operations as a result~~ of ~~distance,~~the ~~language,~~acquisitions ~~and~~that ~~cultural~~we ~~differences~~have made;

● ~~tariffs,~~develop ~~trade~~a ~~barriers,~~scalable ~~customs~~technology ~~classifications~~infrastructure ~~and~~that ~~changes~~can inefficiently ~~trade~~and ~~regulations.~~reliably ~~For~~address ~~example~~increased usage, inas ~~2022~~well ~~the~~as ~~United~~new ~~States~~features ~~imposed broad-ranging economic sanctions against Russia~~ and ~~Belarus because of Russia’s illegal invasion of the Ukraine~~services;

● ~~stringent~~comply ~~local~~with ~~labor~~existing and new laws and regulations applicable to our business;

● anticipate and effectively respond to the ~~uncertainty~~global ofeconomy ~~enforcement~~and ofthe ~~remedies~~markets in ~~foreign~~which ~~jurisdictions~~we operate;

● ~~strict~~establish and ~~unclear~~expand ~~laws~~our ~~around~~various ~~data~~digital ~~privacy~~brands;

● ~~longer~~maintain ~~payment~~our ~~cycles~~reputation and build trust with users, artists, advertisers and employees;

● ~~credit~~offer ~~risk~~competitive ~~and~~economics ~~higher~~to ~~levels~~advertisers ofand ~~payment~~users ~~fraud~~alike;

● ~~profit~~maintain ~~repatriation~~and ~~restrictions~~expand ~~and~~revenue ~~foreign~~producing ~~currency~~initiatives ~~exchange~~including ~~restrictions~~ad sales, in-app purchases and subscriptions;

● ~~political~~deliver orsuperior ~~social~~experiences ~~unrest,~~and ~~economic~~results ~~instability,~~for ~~repression~~users, orartists ~~human~~and ~~rights~~advertisers ~~issues~~alike;

● ~~geopolitical~~identify, ~~events~~attract, ~~including~~retain ~~natural~~and ~~disasters,~~motivate ~~acts~~new ofusers ~~war~~ and ~~terrorism~~artists; and

● ~~import~~manage orour ~~export~~expanding ~~regulations;~~operations.

●If we ~~compliance~~do ~~with~~not ~~U.S.~~successfully ~~laws~~address ~~such~~any asor ~~the~~all ~~Foreign~~of ~~Corrupt~~these ~~Practices Act~~risks, ~~and~~our ~~local~~business, ~~laws~~revenues ~~prohibiting bribery~~ and ~~corrupt~~profitability ~~payments~~could tobe ~~government~~materially ~~officials;~~adversely affected.

●Our recent ~~antitrust~~restructuring efforts may not achieve anticipated financial and ~~competition~~operational ~~regulations;~~goals, increasing our investment risk.

●Our recent ~~potentially~~restructuring ~~adverse~~efforts ~~tax~~may ~~developments;~~not achieve the anticipated cost savings, operational efficiencies, or strategic benefits, which could hinder our ability to meet financial and operational goals and further complicate our growth trajectory. Failure to realize these expected outcomes could materially and adversely affect our business, financial condition, and results of operations.

25Although we had positive cash flow from operating activities fiscal 2023, 2024 and 2025, we had previously incurred, and may once again incur, net losses and experience negative cash flow from operating activities in the future and may not be able to obtain additional capital in a timely manner or on acceptable terms, or at all.

●Our net ~~seasonal~~loss ~~volatility~~in fiscal 2025 was $2.4 million, our net loss in ~~business~~fiscal ~~activity~~2024 was $9.2 million. Our ability to maintain profitability and ~~local~~positive cash ~~economic~~flow ~~conditions;~~from operating activities depends on various factors, including but not limited to, the acceptance of our products and services by mobile phone and internet users, the growth and maintenance of our user base, user acquisition spend and associated return, our ability to maintain existing and obtain new advertisers, our ability to grow our revenues, the success of each of our digital brands as measured by their respective key performance indicators, the effectiveness of our new product initiatives, selling and marketing activities as well as control our costs and expenses. We may not be able to sustain profitability or positive cash flow from operating activities, and any such positive cash flow may not be sufficient to satisfy our anticipated capital expenditures and other cash needs. As such, we may not be able to fund our operating expenses and expenditures out of cash flows, which would require us to utilize debt or equity financing which we may not be able to secure or which we may only secure on terms that are not favorable, which may result in significant dilution or voluntary or involuntary dissolution or liquidation proceeding of us and a total loss of your investment.

●Changes in ~~economic~~accounting ~~uncertainties~~principles ~~relating~~or totheir ~~European~~application ~~sovereign~~could ~~and~~result ~~other~~in ~~debt;~~accounting charges or effects which could adversely affect our operating results and prospects.

●We prepare ~~laws~~consolidated financial statements in accordance with accounting principles generally accepted in the United States. The accounting for our business is subject to change based on how the business model evolves, interpretation of various accounting principles, enforcement of existing or new regulations, ~~licensing~~and ~~requirements~~changes in policies, rules, regulations, and ~~business~~interpretations, ~~practices~~of ~~that~~accounting ~~favor~~and ~~local~~financial ~~competitors~~reporting requirements of the SEC or ~~prohibit~~other ~~foreign~~regulatory ~~ownership~~agencies. A change in any of these principles or ~~investments;~~in their interpretations or application to our business, may have a significant effect on our reported results, as well as our processes and related controls, and may retroactively affect previously reported periods, which may negatively impact our financial statements our business prospects. It is difficult to predict the impact of future changes to accounting principles and accounting policies over financial reporting, any of which could adversely affect our results of operations and financial condition and could require significant investment in systems and personnel.

~~● laws, regulations or rulings that block or limit access to our products;~~25

●If our ~~different,~~estimates ~~uncertain~~or judgments relating to our critical accounting policies are based on assumptions that change or ~~more~~prove ~~stringent~~to ~~user~~be ~~protection~~incorrect, our ~~content,~~operating ~~data~~results ~~protection,~~could ~~privacy,~~suffer ~~intellectual~~and ~~property~~lower the expectations of equity analysts and ~~other~~investors, ~~laws;~~resulting in a decline in the market price of our common stock.

●Our preparation ~~risks~~of ~~related~~financial statements in conformity with generally accepted accounting principles in the United States requires us to ~~other~~make certain ~~government~~estimates ~~regulation~~and assumptions that affect the reported amount of assets and liabilities and the disclosure of contingent liabilities as of the date of the financial statements and the reported amount of revenues and expenses during the reporting period. For example, we ~~required~~make ~~compliance~~certain ~~with~~assumptions ~~local~~about ~~laws~~the interpretation of these principles and accounting treatment of our useful lives of tangible and intangible assets, fair value of contingent consideration, and allowance for credit losses. If these assumptions turn out to be incorrect, the outcomes may be materially higher or ~~lack~~lower than expected for current and future periods, which could have a material adverse effect on our reported earnings. We base estimates and assumptions on historical experience, research, and on other factors that we believe to be reasonable and in accordance with generally accepted accounting principles in the United States, the results of ~~legal~~which ~~precedent;~~form the basis for making judgments about the carrying values of assets, liabilities, equity, revenue and expenses that are not accessible from alternative sources. We also may make estimates regarding activities for which the accounting treatment is still evolving. Actual results may differ from those estimates. If our assumptions change or if actual circumstances differ from our assumptions, our operating results may be adversely affected and could negatively impact investors, resulting in a decline in the market price of our common stock.

●Changes in ~~risks~~tax ~~specific~~laws, totax ~~operating~~rates inor ~~war-torn~~tax ~~regions~~rulings, ~~where~~or ~~employees~~the ~~may~~examination beof ~~mobilized~~our ~~for~~tax ~~army~~positions, ~~service~~could ~~and~~materially ~~where~~affect ~~damage~~our ~~and/or~~financial ~~loss~~condition, ofeffective tax ~~life~~rate, ~~may~~future ~~occur~~profitability ~~when~~and ~~under~~results ~~attack~~of operations.

~~Further,~~Tax laws ~~our~~may ~~ability~~change toas ~~expand~~new ~~successfully~~laws ~~in foreign~~are ~~jurisdictions~~passed ~~involves~~and ~~other~~new ~~risks,~~interpretations ~~including~~of ~~challenges~~the inlaw ~~integrating~~are ~~foreign~~issued ~~operations,~~or ~~risks~~applied. ~~associated~~Our ~~with~~existing ~~entering~~corporate ~~jurisdictions~~structure and inintercompany ~~which~~arrangements ~~we may~~ have ~~little~~been ~~experience~~implemented ~~and~~in ~~the~~a ~~day-to-day~~manner ~~management~~that ofwe abelieve ~~growing~~comply ~~and~~with ~~increasingly~~current ~~geographically~~prevailing ~~diverse~~tax ~~company~~laws. WeHowever, the tax ~~may~~positions ~~not~~that ~~realize~~we ~~the~~take ~~operating~~advantage ~~efficiencies,~~of ~~competitive~~could ~~advantages~~be orundermined ~~financial~~due ~~results~~to ~~that~~changing wetax ~~anticipate~~laws, ~~from~~both ~~our~~in ~~investments~~the United States and in ~~foreign~~ other applicable jurisdictions, including Lithuania, and Israel. In addition, ~~our~~the ~~international~~tax ~~business~~authorities ~~operations~~in ~~could~~the beUnited ~~interrupted~~States and ~~negatively~~other ~~impacted~~jurisdictions byin ~~terrorist~~which ~~activity, war,~~we ~~political~~operate ~~unrest~~regularly examine orincome and other ~~economic~~tax orreturns ~~political~~and ~~uncertainties.~~we ~~Moreover,~~expect ~~foreign~~that ~~jurisdictions~~they ~~could~~may ~~impose~~examine ~~tariffs,~~our ~~quotas,~~income ~~trade barriers~~ and other ~~similar~~tax ~~restrictions~~returns. onThe ~~our~~ultimate ~~international~~outcome ~~sales~~of these examinations may not benefit our business.

WeOur effective ~~are~~tax ~~subject~~rate tofor ~~numerous~~fiscal ~~and~~2025 ~~sometimes~~was ~~conflicting U~~11.S.9% ~~and~~compared ~~foreign~~with ~~laws~~19.3% ~~and~~for ~~regulations~~fiscal ~~that increase our cost of doing business~~2024. ~~Violations~~In ofgeneral, ~~these~~changes ~~complex laws and regulations that apply to our international operations could result~~ in ~~damages,~~applicable ~~awards,~~U.S. ~~fines,~~federal ~~litigation, criminal actions, sanctions, or penalties against us, our officers or our employees, prohibitions on the conduct of our business~~ and ~~our ability to offer products and services, and damage~~ tostate ~~our reputation. Although we have implemented policies~~ and ~~procedures~~foreign ~~designed~~tax ~~to promote compliance with these~~ laws, ~~there~~and ~~can be no assurance that our employees~~regulations, ~~contractors,~~ or ~~agents~~their ~~will~~interpretation ~~not violate our policies or that our policies will be sufficient. These risks inherent in our international operations~~ and ~~expansion~~application, ~~increase~~including ~~our~~the ~~costs~~possibility of ~~doing~~retroactive ~~business internationally and~~ effect, could ~~result~~affect ~~in material harm to~~ our ~~business,~~tax ~~operating results, and financial condition~~expense.

~~Conditions~~Effective January in1, ~~Israel~~2022, ~~including~~ pursuant to the ~~October~~Tax 7Cuts and Jobs Act of 2017, ~~2023~~R&D ~~attack~~expenses byare ~~Hamas~~required to be capitalized and ~~other~~amortized ~~terrorist~~for ~~organizations~~US tax ~~from~~purposes, which has delayed the ~~Gaza~~deductibility ~~Strip~~of these expenses and ~~Israel’s~~potentially ~~war~~increase ~~against~~the ~~them~~amount of cash taxes we paid during the years ended July 31, 2024 and 2023. In the future, among other things, Congress may consider legislation that would defer the capitalization requirement to later years or eliminate the capitalization requirement, possibly with retroactive effect, and/or the IRS may ~~adversely~~issue ~~affect~~guidance on the currently enacted tax law which differs from our interpretation. It is possible that the enactment of new legislation and/or issuance of IRS guidance could have a material effect on our financial condition, results of operations and cash flows in future periods.

~~Because~~In July a2025, ~~portion~~the ~~of our~~U.S. ~~operations~~government ~~are~~enacted ~~conducted~~The inOne ~~Israel~~Big ~~and~~Beautiful ~~certain~~Bill ~~members~~Act (“OBBBA”) which includes a broad range of tax reform provisions that may affect our ~~board~~financial ofresults. ~~directors~~The ~~and~~OBBBA ~~management~~includes, asamong ~~well~~other asprovisions, athe ~~many~~allowance of ~~our~~immediate ~~employees~~expensing of qualifying domestic research and ~~consultants,~~development ~~are~~expenses ~~located~~and inpermanent ~~Israel,~~extensions ~~our~~of ~~business~~certain ~~and~~provisions ~~operations~~within ~~are~~the ~~directly~~Tax ~~affected~~Cuts byand ~~economic,~~Jobs ~~political~~Act, which ~~geopolitical~~was ~~and~~signed ~~military conditions~~into ~~affecting~~law ~~Israel~~in 2017. ~~Since~~The ~~the~~Inflation ~~establishment~~Reduction ofAct ~~the~~(“IRA”), ~~State~~signed ofinto ~~Israel~~law in ~~1948~~2022, aincludes ~~number~~various ofcorporate tax ~~armed~~provisions ~~conflicts~~including ~~have~~a ~~occurred~~new ~~between Israel~~alternative ~~and~~corporate ~~its~~minimum ~~neighboring~~tax ~~countries~~on ~~and~~applicable ~~other~~corporations. ~~hostile~~The ~~non-state~~IRA ~~actors.~~tax ~~These~~provisions ~~conflicts~~may ~~have~~become ~~involved~~applicable to ~~missile~~us ~~strikes~~in future years, ~~hostile~~which ~~infiltrations and~~could ~~terrorism~~result ~~against~~in ~~civilian~~additional ~~targets~~taxes, ina ~~various~~higher ~~parts~~effective oftax ~~Israel~~rate, ~~which~~reduced ~~have~~cash ~~negatively~~flows ~~affected~~and ~~business~~lower ~~conditions~~overall inprofitability of ~~Israel~~our operations.

OnThe OECD ~~October~~introduced 7,significant ~~2023,~~changes ~~Hamas~~to the international tax law framework through the Pillar Two guidelines. The framework outlines ~~militants~~a ~~and~~coordinated ~~members~~set of ~~other~~rules ~~terrorist~~to ~~organizations~~prevent ~~infiltrated~~multinational ~~Israel’s~~enterprises ~~southern~~from ~~border~~shifting ~~from~~profits ~~the~~to ~~Gaza~~low-tax ~~Strip~~jurisdictions ~~and~~by ~~conducted~~implementing a 15% ~~series~~global ofminimum ~~terror~~tax. ~~attacks~~Many oncountries ~~civilian~~in ~~and~~which ~~military~~we ~~targets. Thereafter~~operate, ~~Hamas~~including ~~launched~~the ~~extensive~~member ~~rocket~~states ~~attacks~~of onthe ~~Israeli~~EU, ~~population~~have ~~and industrial~~enacted ~~centers~~Pillar ~~located~~Two. ~~along~~Pillar ~~the~~Two ~~Israeli~~rules began ~~border~~applying ~~with~~to ~~the~~us ~~Gaza~~in ~~Strip~~fiscal year 2025. ~~Shortly~~In ~~following~~January 2025, the ~~attack,~~United ~~Israel’s~~States ~~security~~issued ~~cabinet~~an executive order announcing opposition to aspects ~~declared~~of ~~war~~these ~~against~~rules. ~~Hamas~~In ~~and~~late ~~launched~~June an2025, ~~aerial~~a ~~bombardment~~shared understanding of ~~various~~a ~~targets~~new ~~within~~“side-by-side” ~~the~~solution ~~Gaza~~to ~~Strip~~address U.S. ~~The~~concerns ~~Israeli~~with Pillar ~~government~~Two ~~subsequently called~~was ~~for~~announced. If agreed upon and legislated by the ~~evacuation~~OECD ofcountries, ~~over~~this ~~one~~would ~~million~~exclude ~~residents~~U.S.-parented groups from certain provisions of ~~the~~Pillar ~~northern~~Two. ~~part~~The potential effects of Pillar Two may vary depending on the ~~Gaza~~specific ~~Strip~~provisions and ~~initiated~~rules ~~ground~~implemented ~~operations~~by ineach ~~the~~country ~~Gaza~~that ~~Strip.~~adopts ~~The~~Pillar ~~intensity~~Two and ~~duration~~may ofinclude ~~Israel’s~~tax ~~current~~rate ~~war~~changes, ~~against~~higher ~~Hamas~~effective istax ~~difficult~~rates, topotential ~~predict~~tax asdisputes ~~are~~and ~~such~~adverse ~~war’s~~impacts ~~economic~~to our ~~implications~~cash onflows, ~~the~~tax ~~global~~liabilities, ~~economy~~results of operations and financial position.

26Global tax developments applicable to multinational companies may continue to result in new tax regimes or changes to existing tax laws, regulations, and taxation officer interpretations. If the U.S. or foreign taxing authorities change tax laws, our overall taxes could increase, lead to a higher effective tax rate, harm our cash flows, results of operations and financial position.

~~The intensity and duration of Israel’s current war against Hamas is difficult to predict, and as are such war’s economic implications on the Company’s business and operations.~~26

~~Other terrorist organizations have since joined~~We ~~the~~are ~~hostilities,~~exposed ~~including~~to ~~Hezbollah~~fluctuations in ~~Lebanon,~~foreign ~~and~~currency ~~Palestinian~~exchange ~~military organizations in the West Bank~~rates. In September 2024 Israel initiated a ground invasion of southern Lebanon to rid it of Hezbollah operatives who have been shelling Israel since October 8, 2023. Israeli officials have stated that their aim is to allow tens of thousands of its citizens to return home without the threat of attack by Hezbollah militants.

~~Furthermore~~The substantial majority of our revenues are denominated in U.S. dollars, ~~Iran~~and ~~has~~our ~~fired~~operating ~~hundreds~~expenses are generally denominated in the local currencies of ~~missiles~~the countries where our operations are located. We have significant operations in Europe and Israel that are denominated in the Euro and ~~drones~~Israeli Shekel. The strengthening or weakening of the U.S. Dollar versus these currencies impacts the expenses generated in these foreign currencies when converted into ~~Israel~~the U.S. Dollar. In fiscal 2025 and ~~Israel~~fiscal ~~has~~2024, ~~recently~~we ~~responded~~recorded losses of $151,000 and $190,000, respectively, from foreign currency movements relative to ~~that~~the ~~action~~U.S. ~~with~~Dollar. ~~attacks~~Included onin ~~military~~these ~~sites~~amounts were gains from hedging activities of $44,000 and losses of $245,000 in ~~Iran~~fiscal 2025 and fiscal 2024, respectively. While we regularly enter into transactions to hedge portions of our foreign currency exposure, it is impossible to predict or eliminate the effects of this exposure. Fluctuations in foreign exchange rates could significantly impact our financial results.

~~As a result of the Israeli~~If ~~security~~we ~~cabinet’s~~fail ~~decision~~ to ~~declare~~implement ~~war against Hamas~~ and ~~more~~maintain ~~recently~~an ~~expand~~effective ~~their~~system ~~operations against Hezbollah, several hundred thousand Israeli reservists were drafted to perform immediate military service. Certain~~ of ~~our~~internal ~~employees~~controls ~~and~~over ~~consultants~~financial ~~in Israel have been mobilized for service in the current war against Hamas as of the date of this report~~reporting, ~~and~~we ~~such persons are expected~~ may be ~~absent for~~unable anto ~~extended~~accurately ~~period of time. As a result,~~ report our ~~operations,~~results ~~including the development and launch~~ of ~~additional products~~operations, ~~may~~meet ~~be disrupted by such absences, which may materially and adversely affect~~ our ~~business~~reporting ~~and~~obligations ~~results~~or ofprevent ~~operations~~fraud.

~~Prior~~Under Section to404 of the ~~Hamas~~Sarbanes-Oxley ~~attack in~~Act ~~October~~of ~~2023~~2002, ~~the~~we ~~Israeli~~are ~~government~~required ~~pursued~~to ~~extensive~~include ~~changes~~a toreport ~~Israel’s~~of ~~judicial~~management ~~system,~~on ~~which~~our ~~sparked~~internal ~~extensive~~control ~~political~~over financial ~~debate~~reporting ~~and~~in ~~unrest~~our annual report on Form 10-K. In ~~response~~addition, toshould ~~such~~we ~~initiative,~~become ~~many~~an ~~individuals~~accelerated filer, ~~organizations~~our ~~and~~independent ~~institutions,~~registered ~~both~~public ~~within~~accounting firm must attest to and ~~outside~~report ofon ~~Israel, have~~the ~~voiced~~effectiveness ~~concerns~~of ~~that~~our ~~the~~internal ~~proposed~~control ~~changes~~over ~~may~~financial ~~negatively~~reporting. ~~impact~~Our ~~the~~management ~~business~~may ~~environment~~conclude inthat our ~~Israel~~internal ~~including~~control ~~due~~over tofinancial ~~reluctance~~reporting ~~of foreign~~is ~~investors~~not toeffective. ~~invest~~Moreover, oreven ~~transact~~if ~~business~~our inmanagement ~~Israel~~concludes asthat ~~well~~our asinternal tocontrol over ~~increased~~financial ~~currency~~reporting ~~fluctuations~~is effective, ~~downgrades~~our inindependent ~~credit~~registered ~~rating, increased~~public ~~interest~~accounting ~~rates~~firm, ~~increased~~after ~~volatility~~conducting inits ~~security~~own ~~markets~~independent testing, may ~~and~~issue ~~other~~a ~~changes~~report inthat ~~macroeconomic~~is ~~conditions.~~qualified ~~The~~if ~~risk~~it ofis ~~such~~not ~~negative developments~~satisfied ~~has~~with ~~increased~~our ininternal ~~light~~controls ofor the ~~recent~~level ~~Hamas~~at ~~attacks~~which ~~and~~our ~~the~~controls ~~war~~are ~~against~~documented, designed, ~~Hamas~~operated ~~declared~~or byreviewed, ~~Israel.~~or Toif ~~the~~it ~~extent~~interprets ~~that~~the ~~any~~relevant ~~of these~~requirements ~~negative~~differently ~~developments~~from dous. ~~occur~~In addition, ~~they~~our reporting obligations may ~~have~~place ana ~~adverse~~significant ~~effect~~strain on our ~~business~~management, operational and financial resources and systems for the foreseeable future. We may be unable to timely complete our ~~results~~evaluation oftesting ~~operations~~and any required remediation.

InDuring the ~~addition,~~course ~~recent~~of ~~political~~documenting ~~uprisings~~ and ~~conflicts in~~testing ~~various~~our ~~countries~~internal control procedures, in order to satisfy the ~~Middle~~requirements ~~East,~~of ~~including~~Section ~~Syria~~404, ~~are~~we ~~affecting~~may ~~the~~identify weaknesses ~~political~~and ~~stability~~deficiencies ofin ~~those~~our ~~countries~~internal control over financial reporting. In addition, if we fail to maintain the ~~threats~~adequacy of our ~~that~~internal ~~Iran~~control ~~and~~over ~~various~~financial ~~extremist~~reporting, ~~groups~~as inthese ~~the~~standards ~~region~~are ~~make~~modified, ~~against~~supplemented ~~Israel~~or amended from time to time, we may ~~escalate~~not be able to conclude on an ongoing basis that we have effective internal control over financial reporting in ~~the~~accordance ~~future~~with Section 404. If we fail to achieve and ~~turn~~maintain ~~violent~~an effective internal control environment, ~~which~~we could ~~affect the~~suffer ~~Israeli~~material ~~economy~~misstatements in ~~general~~our financial statements and usfail into ~~particular.~~meet ~~Any~~our ~~armed~~reporting ~~conflicts~~obligations, ~~terrorist~~and ~~activities~~we ormay ~~political~~be ~~instability~~required into ~~the~~restate ~~region~~our financial statements from prior periods, any of which would likely cause investors to lose confidence in our reported financial information. This could ~~adversely~~in ~~affect~~turn ~~business~~limit ~~conditions~~our access to capital markets, harm our results of operations, and ~~make~~lead itto ~~harder~~a ~~for~~decline usin tothe ~~raise~~trading ~~capital~~price of our stock.

~~For the most part~~Additionally, ineffective weinternal docontrol ~~not~~over ~~have~~financial ~~commercial~~reporting ~~insurance that~~could ~~cover~~expose ~~losses~~us ~~that~~to ~~may~~increased ~~occur~~risk ~~as a result~~ of anfraud ~~event~~or ~~associated~~misuse ~~with the security situation in either~~ of ~~these~~corporate ~~locations.~~assets ~~Although~~and subject ~~the~~us ~~Israeli~~to ~~government~~potential ~~has~~delisting infrom the ~~past~~stock ~~covered~~exchange ~~the~~on ~~reinstatement~~which ~~value of certain damages that were caused by terrorist attacks or acts of war,~~ we ~~cannot assure you that this government coverage will be maintained or~~list, ifregulatory ~~maintained,~~investigations ~~will be sufficient to compensate us fully for damages incurred. Any losses or damages incurred would likely cause a significant disruption in our employees’ lives~~ and ~~possibly put~~civil ~~their lives at risk, which would have a material adverse effect on our operations. Any armed conflicts~~ or ~~political~~criminal ~~instability in the region would likely negatively affect business conditions generally and could harm our results of operations~~sanctions.

~~Additionally, in the past, the State of Israel~~RISKS ~~and~~RELATED ~~Israeli~~TO ~~companies~~OUR have been subjected to economic boycotts. Several countries still restrict business with the State of Israel and with Israeli companies. These restrictive laws and policies may have an adverse impact on our results of operations, financial conditions or the expansion of our business. A campaign of boycotts, divestment and sanctions has been undertaken against Israel, which could also adversely impact our business.OPERATIONS

We may ~~have~~not ~~offices~~be ~~and~~able ~~other~~to ~~significant~~effectively ~~operations located~~manage inour ~~Lithuania,~~growth ~~Israel,~~or ~~and~~implement ~~Norway,~~our ~~and,~~future ~~therefore~~business strategies, ~~our~~in ~~results~~which ~~may~~case beour ~~adversely~~business ~~affected~~and byresults of ~~political,~~operations ~~economic~~may ~~and~~be ~~military~~materially ~~instability in~~and ~~these~~adversely ~~countries~~affected.

~~The overwhelming majority of our employees are~~Our ~~located~~continued insuccess ~~Lithuania,~~depends ~~Israel,~~on ~~and Norway and many of~~ our ~~senior~~ability ~~managers~~to ~~live~~effectively ~~in Israel or Lithuania. For those that reside in Israel~~ and ~~Lithuania~~efficiently ~~political,~~grow ~~economic~~each ~~and military conditions directly affect our business. Any hostilities involving these countries or the interruption or curtailment~~ of ~~trade between these countries and their trading partners could adversely affect our business and results of operations. Furthermore, there is always~~ the ~~chance~~properties ~~that the citizens~~ in ~~these~~our ~~countries~~brand ~~will be required to serve in the army or perform public duty in the event of an armed conflict~~portfolio.

27We may not be capable of growing our business organically or with paid marketing campaigns, attract new players and artists and/or establish cooperation with strategic partners. Our business has experienced periods of rapid growth and expansion that has placed, and continues to place, significant strain on our management and resources. We cannot assure you that these periods will recur or be sustainable. We have also acquired other companies and made asset purchases and integrating those into Zedge has placed and continues to place significant strain on management and resources. We believe that continued growth of our business will depend on our ability to successfully develop and enhance our products and services, cost efficiently attract new artists and individual creators, maintain our relationship with various artists and content partners like Google, Meta and Apple, sustain our high rankings with the leading search engines including Google, capture the changes that are taking place in the industry in a timely fashion grow our user base at a cost effective rate, retain existing users, continue developing innovative technologies in response to user demand, increase brand awareness through marketing and promotional activities, react to changes in market trends, expand into new market segments, attract new advertisers, retain existing advertisers, get users to engage with our digital properties and convert into paying users or subscribers, and take advantage of the growth in the relevant markets. We cannot assure you that we will achieve any or all of the above. In the event that we are not successful in some or all of these areas we may not be able to retain our customers and advertisers.

The State of Israel is currently at war with Hamas and Hezbollah, terrorist organizations that control the Gaza Strip and Lebanon, respectively, and has had various armed conflicts with its neighbors as well as terrorist acts committed within Israel by hostile elements.27

~~The~~To manage ~~Republic~~our ofgrowth ~~Lithuania~~and ~~borders~~for ~~both~~us ~~the~~to ~~Russian exclave~~attain ~~of Kaliningrad~~ and ~~the~~maintain ~~Republic~~profitability, ofwe ~~Belarus,~~will ~~who~~also ~~are~~need ~~aligned~~to infurther ~~Russia’s~~expand, ~~illegal~~train, ~~invasion~~manage ofand ~~the~~motivate ~~Ukraine.~~our workforce ~~This~~across ~~places~~multiple ~~Lithuania at~~geographies aand ~~higher~~manage ~~risk~~our ofrelationships ~~military~~with ~~conflict~~users, ~~may~~consultants, ~~negatively~~business ~~impact~~partners ~~the~~and ~~ability~~advertisers toglobally. We ~~travel~~anticipate tothat ~~and~~we ~~from~~will ~~Lithuania,~~need ~~and~~to ~~may~~implement ~~damage~~a ~~the~~variety ~~economy. This~~of ~~action~~enhanced ~~also~~and ~~negatively~~upgraded ~~impacted~~operational ~~GuruShots~~and ~~because~~financial itsystems, ~~utilizes~~procedures aand ~~small~~controls, including ~~number~~the improvement of ~~outsourced~~our ~~contractors~~accounting ~~based~~and inother ~~the~~internal ~~Ukraine~~management systems. ~~This resulted~~All inof ~~temporarily~~these ~~disrupting~~endeavors ~~the~~involve ~~work~~risks ~~product~~and ~~associated~~will ~~with~~require substantial ~~these~~management ~~contractors~~efforts atand ~~the~~skills ~~outset~~and ofadditional ~~the war~~expenditures.

~~Companies~~Our products ~~and~~currently ~~governmental~~enjoy ~~agencies~~a global customer base. This geographic diversity may ~~restrict~~raise the level of difficulty in managing future growth ~~access~~and toprofitability. We cannot assure you that our ~~website~~current orand ~~mobile~~planned ~~apps~~personnel, orsystems, ~~the~~procedures ~~internet~~and ~~generally,~~controls ~~which~~will ~~could~~be ~~lead~~adequate to support ~~the~~our ~~loss~~future oroperations. ~~slower~~In ~~growth~~addition, ofwe ~~our~~cannot ~~user~~assure ~~base,~~you inthat ~~which case~~we will be able to effectively manage our growth or implement our future business strategies effectively, and ~~results~~failure ofto ~~operations~~do so may be materially and adversely ~~affected~~affect our business and results of operations.

InDuring the ~~order~~past tofive ~~grow our business~~years, ~~users~~we ~~need~~have toexperienced ~~access the~~a ~~internet~~shift ~~and,~~ in ~~particular,~~ our ~~digital~~Zedge ~~products.~~App’s ~~Companies~~regional ~~and~~customer ~~governmental~~make-up ~~agencies~~with ~~could~~the ~~block~~portion ~~access~~of to our ~~websites~~total ~~and apps~~MAU orfrom ~~the~~emerging ~~internet~~markets ~~generally.~~increasing, ~~For~~and ~~example,~~the inportion ~~2013~~from ~~the~~well-developed ~~Indian~~markets ~~courts~~decreasing. ~~issued~~In ~~orders~~Q4 ~~restraining~~of ~~internet~~fiscal ~~service~~2025, ~~providers~~our ~~from~~Zedge ~~providing~~App’s ~~access~~users toin ~~various~~emerging ~~internet~~markets ~~domains~~declined ~~including~~by ~~ours~~13.6% ~~Access~~while toits ~~our~~users ~~Zedge~~in ~~App~~well-developed ~~through~~regions ~~any~~declined ~~mode~~1.8% ~~was~~when ~~blocked~~compared into ~~many~~fiscal ~~parts~~2024. of India ~~from February~~ ~~2013~~comprised ~~until~~32.5% ~~August~~of ~~2019~~our ~~and~~MAU ~~there~~as ~~can~~of beJuly no31, ~~guaranties~~2025. ~~that~~This ~~this~~shift ~~will~~has ~~not~~negatively ~~recur~~impacted orrevenues ~~happen~~because ~~elsewhere.~~well-developed Ifmarkets ~~companies~~command ~~or governmental entities~~materially ~~block~~higher oradvertising ~~limit~~rates ~~access~~when compared to ~~our~~those ~~Zedge~~in ~~App~~emerging ormarkets. ~~otherwise~~Although ~~adopt~~we ~~policies~~are ~~restricting~~investing ~~access~~in toreversing ~~our~~this ~~advertiser’s~~trend, ~~products~~we ~~and~~may ~~services our~~not ~~business could~~ be successful ~~negatively impacted resulting~~ in athis ~~loss~~effort orwhich ~~slow-down~~may ofresult ~~user~~in ~~growth~~lower revenues and~~/or~~ ~~revenues~~profitability.

~~Our~~In 2021, ~~core~~Apple ~~values~~released iOS 14 which started requiring users to opt in to share their identifier for advertisers IDFA with app developers. Apple’s IDFA is a unique string of ~~focusing~~alphanumeric oncharacters ~~our~~assigned to Apple devices which advertisers use to identify app users in order to deliver personalized and ~~acting~~ ~~for~~targeted advertising. According to Statista, the ~~long~~worldwide opt-~~term~~in rate enabling app tracking after the release of iOS 14 was less than 25%. As a consequence, the ability of advertisers to accurately target, measure and optimize their advertising campaigns at the user level has become significantly more difficult typically resulting in higher user acquisition costs. Further, other companies upon whom the industry depends to identify potential users such as Google may ~~conflict~~implement similar changes with respect ~~the~~to ~~short~~its Android operating system. The longer-term ~~interests~~impact of these changes on the overall mobile advertising ecosystem, our competitors, our business, and the developers, partners, and advertisers within our community remains uncertain, and depending on how we, our competitors, and the overall mobile advertising ecosystem adjusts, and how our partners, advertisers, and users respond, our business could be seriously harmed. If we are unable to mitigate or respond to these and future developments, and alternative solutions do not become widely adopted by our advertisers, then targeting, measurement, and optimization capabilities will be materially and adversely affected, which would in turn negatively impact our advertising revenue.

~~One~~Our products ofmay ~~our~~contain ~~core~~errors, ~~values~~flaws isor ~~providing~~failures anthat ~~excellent user~~may ~~experience,~~only ~~which~~become weapparent ~~believe~~after istheir ~~essential~~release. toFrom ~~our~~time ~~success~~to ~~and serves the best~~time, ~~long-term~~we ~~interests~~receive ofuser feedback usin ~~and~~connection ~~our~~with ~~stockholders. Therefore~~errors, we ~~have~~flaws ~~made~~or infailures ~~the~~and ~~past~~such errors, ~~and/~~flaws or failures may ~~make~~also income ~~the~~to ~~future,~~our ~~significant~~attention ~~investments~~during orour ~~changes~~internal testing inprocess. ~~strategy~~We ~~that~~generally wehave ~~think~~been ~~will~~able ~~benefit~~to ~~our users~~resolve such errors, ~~even~~flaws ifor ~~our~~failures ~~decision~~in ~~negatively~~a ~~impacts~~timely ~~our~~manner, ~~operating~~but ~~results~~we incannot ~~the~~assure ~~short~~you ~~term.~~that we Inwill ~~addition,~~be ~~our~~able ~~philosophy~~to ofdetect ~~prioritizing~~and ~~our users~~resolve ~~may~~all ~~cause~~of ~~disagreements~~them effectively or ~~negatively~~in ~~impact~~a ~~our~~timely ~~relationships~~manner. ~~with~~Errors, ~~advertisers~~flaws or ~~other~~failures ~~third~~in ~~parties.~~our ~~Our~~services ~~decisions~~and products may ~~not~~adversely ~~result in~~affect ~~the~~user ~~long-term~~experience ~~benefits~~and ~~that~~cause weour ~~expect,~~users into stop using our services and products, which ~~case~~could ~~the~~materially ~~success~~and ofadversely affect our business and ~~operating~~ results ~~could~~of ~~be materially harmed~~operations.

IfWe need weto ~~are~~invest ~~unable~~in paid user acquisition in order to ~~attract~~grow ~~and~~our ~~retain~~customer ~~highly qualified~~base. ~~employees~~However, we may not be able to ~~grow~~secure ~~effectively~~new users at scale with a positive return on investment. Even if we can secure new profitable customers these customers may not mature into sustainable long-term customers.

Our ability to compete and grow depends in large part on the efforts and talents of our employees. Such employees, particularly product managers, designers and engineers, are in high demand, and we devote significant resources to identifying, hiring, training, and successfully integrating and retaining these employees. The loss of employees or the inability to hire additional skilled employees as necessary could result in significant disruptions to our business, and the integration of replacement personnel could be time-consuming and expensive and cause additional disruptions to our business.28

~~We operate a development center in Vilnius, Lithuania.~~Our Ifmarketing weefforts ~~are unable~~ to ~~recruit~~acquire new, and retain ~~well~~existing, ~~qualified~~customers ~~candidates~~may atnot anbe ~~attractive~~effective ~~rate~~ or ~~manage them well~~cost-efficient, ~~our business will struggle to meet our development goals~~ and ~~objectives.~~may Inbe ~~fiscal~~affected 2021 we adopted a “remote-first” work policy that enabled employees to work from home unless they were needed in the office. In fiscal 2023 we changed this policy to a hybrid model requiring most employees to work from the office several days a week. Although this policy has been well received by ~~employees, it is as of yet unclear whether~~external itfactors ~~will~~beyond beour ~~further revised~~control.

InMaintaining and ~~April~~promoting awareness of ~~2022~~our weservices ~~completed~~is ~~the~~important ~~acquisition of~~to ~~GuruShots~~our ~~Ltd,~~ability anto ~~Israeli~~attract ~~based~~and ~~company~~retain customers. ~~GuruShots~~We ~~utilized~~spend a ~~small~~significant ~~number~~amount ofon marketing ~~outsourced~~activities ~~contractors~~to ~~based~~acquire innew ~~the~~customers ~~Ukraine.~~and ~~Russia’s illegal~~retain ~~invasion~~and ofengage ~~the~~existing ~~Ukraine~~customers inand ~~February~~have ~~2022~~plans ~~resulted~~to maintain and increase that focus. For example, in ~~temporarily~~2025 ~~disrupting~~and ~~the~~2024 ~~work~~our ~~product~~marketing ~~associated~~expenses ~~with~~were ~~these~~approximately ~~contractors~~$8. ~~Furthermore~~2 million and $6.9 million, ~~Zedge~~respectively, ~~employees~~and ~~situated~~we inexpect ~~Vilnius~~our marketing ~~were~~expenses ~~distracted~~to ~~due~~continue to ~~the~~account ~~proximity~~for toa significant portion of our operating expenses. Our business depends on a high degree of app installs from the ~~Belarusian~~app ~~border~~stores and ~~uncertainty~~website ~~related~~traffic, which is dependent on many factors, including the availability of appealing towebsite ~~Belarus’~~content ~~complicity~~and ~~with~~search ~~Russia’s~~engine ~~illegal~~optimization, ~~action~~affiliate marketing and ~~associated~~display ~~intent~~advertising, as well as social media and email. InThe ~~addition~~marketing efforts we implement may not succeed for a variety of reasons, ~~consumer~~including ~~prices~~our ~~have~~inability ~~risen~~to ~~materially throughout~~execute ~~the~~and ~~Eurozone~~implement ~~leaving~~our ~~uncertainty~~plans. ~~about~~External ~~how~~factors beyond ~~this~~our control may also impact ~~employment~~the ~~costs~~success inof ~~the~~our ~~future~~marketing initiatives.

28Our digital presence heavily depends on search engine traffic, primarily from platforms like Google. A key driver of our success in this domain is our website’s visibility and ranking in response to search queries. Search engines frequently update their algorithms, which may affect our link placements and rankings, and require ongoing investment in search engine optimization to mitigate potential traffic losses. In addition, the integration of artificial intelligence features by search engines, such as AI-generated overviews, summaries, or embedded rich media, may reduce the likelihood that users click through to our properties, as they may receive the desired content directly within the search results page. These developments could also extend to the direct display of emojis, wallpapers, or other types of content that we currently provide, further diminishing referral traffic. A sustained decrease in organic traffic from these or similar changes could require us to increase our reliance on paid user acquisition or other marketing channels, potentially increasing costs and adversely affecting margins. These risks highlight the critical importance of continuous adaptation to the evolving search engine and AI landscape and the potential consequences if we do not effectively anticipate, respond to, and capitalize on these changes.

InUser acquisition ~~October~~for ofour ~~2023~~apps ~~Hamas,~~depends aon ~~designated terrorist organization, launched~~ a ~~savage~~host ~~terror~~of ~~attack~~items inincluding ~~Israel~~and ~~along~~especially ~~with~~on ~~launching~~paid ~~thousands~~and oforganic ~~rockets~~app ~~into~~marketing ~~Israeli sovereign territory~~initiatives. ~~The~~Effective ~~State~~and ofprofitable ~~Israel~~user ~~declared~~acquisition ~~war~~relies ~~against~~on ~~Hamas~~knowing ~~resulting~~how into ~~the~~optimize ~~mobilization~~across ofeach ~~more~~acquisition ~~than~~platform, ~~300~~data analysis,~~000~~ ~~army~~creatives, ~~reserve~~amongst other things. In addition, ~~Hezbollah,~~due ~~another designated~~to ~~terrorist~~the ~~organization,~~changing ~~based~~nature inof ~~Lebanon,~~what ~~has~~data ~~been~~the ~~indiscriminately~~platforms ~~shelling~~provide ~~Israeli~~to ~~territory.~~publishers ~~Some~~like ~~GuruShots~~Zedge ~~employees~~may ~~were impacted~~result ~~and~~in ~~the~~elongating testing ~~regular~~time windows and ~~consistent~~increasing ~~rocket~~testing ~~barrage~~budgets. isTaken ~~taking~~together aif ~~toll~~we onare ~~productivity.~~unsuccessful ~~Coupled~~in ~~with~~accounting ~~this,~~for ~~most,~~all ifof ~~not~~these ~~all~~items, ~~schools~~we may ~~are~~be ~~along~~unable ~~with~~to recover our ~~office~~marketing ~~closed~~spend ~~making~~and ~~the~~we ~~work~~may ~~environment~~not ~~complex.~~acquire Itnew ~~remains~~customers ~~unclear~~or ~~how~~our ~~long~~cost ~~this~~to ~~conflict~~acquire ~~will~~new ~~continue~~customers ~~and~~may ~~what~~increase, and our existing customers may reduce the ~~impact~~frequency or size of their purchases from us, any of which could have a material adverse effect on ~~productivity~~our ~~will~~business, beprospects, results of operations, financial condition or cash flows.

~~We believe that two critical components of our~~Our ~~success~~international ~~are~~operations ~~our~~expose ~~ability~~us to ~~retain~~additional ~~our~~risks ~~best~~that ~~people~~could byharm ~~preserving~~ our ~~culture~~business, ~~and~~operating ~~maintaining~~results ~~competitive compensation practices. As we continue to grow rapidly,~~ and wefinancial ~~develop the infrastructure of a public company, we may find it difficult to maintain our entrepreneurial, execution-focused culture~~condition. In addition, depending on the performance of our stock price some of our employees are able to receive material proceeds from sales of our equity in the public markets, which may reduce their motivation to continue to work for us.

WeIn addition ~~rely on third parties~~ to ~~provide~~uncertainty ~~the~~about ~~technologies, including~~our ~~cloud~~ability ~~services, necessary~~ to ~~deliver~~continue ~~content,~~expanding ~~advertising,~~ and ~~services~~monetizing tointernationally, our ~~users,~~foreign ~~and~~operations ~~any~~may ~~change~~subject ~~in the licensing terms,~~us ~~costs,~~to ~~availability,~~additional orrisks ~~acceptance of these formats and technologies could materially adversely affect our business.~~including:

~~Our~~● ~~service~~difficulties ~~and hosting providers may experience downtime from time to time, which may negatively affect our brand and user perception of the reliability of our service. Any scheduled or unscheduled interruptions~~ in ~~service could result in an immediate~~developing, ~~and possibly substantial~~staffing, ~~loss~~traveling ~~of revenues. Although we seek~~ to ~~reduce~~ ~~the possibility of disruptions or other outages, our websites~~ and ~~apps~~simultaneously ~~may~~managing beforeign ~~disrupted~~operations byas problems relating either to our own technology or third-party technology that is used for them. Our systems may be vulnerable to damage or interruption from telecommunication failures, power loss, computer or hacking attacks or viruses, earthquakes, floods, fires, terrorist attacks and similar events. Parts of our system are not fully redundant or backed up, and our disaster recovery planning may not be sufficient for all eventualities. Despite any precaution we may take, the occurrence of a ~~natural disaster or other unanticipated problems at our hosting facilities could~~ result in ~~lengthy interruptions in the availability~~ of ~~our products. Any interruption in the ability of users to access our websites or apps could reduce our future revenues~~distance, ~~harm our future profits~~language, ~~subject us to regulatory scrutiny~~ and ~~lead~~cultural users to seek alternative internet mobile products. In addition, a hacking attack or another security incident, could result in unauthorized access to, damage to, disablement or encryption of, use or misuse of, disclosure of, modification of, destruction of, or loss of our data or our developers’, creators’, and users’ data or disrupt our ability to provide our platforms or services.differences;

~~There~~● ~~can~~tariffs, betrade nobarriers, ~~assurance~~customs ~~that~~classifications ~~these~~and ~~providers will~~changes ~~continue~~in ~~licensing~~trade ~~their~~regulations. ~~technologies~~For ~~or intellectual property to us on reasonable terms~~example, orin at2022 ~~all. Providers may change~~ the ~~fees they~~United ~~charge~~States ~~users~~imposed orbroad-ranging ~~otherwise~~economic ~~change~~sanctions ~~their~~against ~~business~~Russia ~~model~~and inBelarus abecause ~~manner that slows the widespread acceptance~~ of ~~their~~Russia’s ~~technologies.~~illegal ~~Any change~~invasion ~~in the licensing terms, costs, availability, or user acceptance~~ of ~~these technologies could materially and adversely affect our business, revenues and profitability.~~Ukraine;

We● ~~track~~stringent ~~certain~~local ~~key~~labor ~~performance~~laws ~~indicators with internal~~ and third-party tools and do not independently verify that all of this data is accurate. Certain of these indicators may have challenges in being tracked accurately which could result in real or perceived inaccuracies that could negatively impact our business.regulations;

We track certain key performance indicators, including daily active users, monthly active users, purchasers, and paying subscribers using both internal and third-party tracking tools. Our analytical tools have certain limitations, including those from third-party providers, and our ability to access and monitor this data may change, which would adversely impact our ability to track these KPIs. If the internal or external tools we use to track data contain bugs we may make poor decisions, especially when it comes to paid user acquisition, based on flawed and inaccurate data which can hurt our reputation and financial position.29

29● the uncertainty of enforcement of remedies in foreign jurisdictions;

We● ~~use~~strict ~~open-source~~and ~~software~~unclear inlaws ~~our~~around ~~platform that~~data ~~may subject our technology to general release or require us to re-engineer our solutions, which may cause materially harm to our business.~~privacy;

We● ~~use~~longer ~~open-source~~payment software in connection with our services. From time to time, companies that incorporate open-source software into their products have faced claims challenging the ownership of open-source software and/or compliance with open-source license terms. Therefore, we could be subject to lawsuits by parties claiming ownership of what we believe to be open-source software or noncompliance with open-source licensing terms. Some open-source software licenses require users who distribute or make available open-source software as part of their software to publicly disclose all or part of the source code to such software and/or make available any derivative works of the open-source code on unfavorable terms or at no cost. While we monitor our use of open source software and try to ensure that none is used in a manner that would require us to disclose the source code or that would otherwise breach the terms of an open-source agreement, such use could nevertheless occur and we may be required to release our proprietary source code, pay damages for breach of contract, re-engineer our applications, discontinue use in the event re-engineering cannot be accomplished on a timely basis or take other remedial action that may divert resources away from our development efforts, any of which could materially and adversely affect our business, financial condition or operating results.cycles;

~~Our~~● ~~business,~~credit ~~results~~risk ~~of operation~~ and ~~financial condition~~higher ~~could~~levels ~~be adversely affected by the Covid 19 pandemic, other global epidemics and the restrictions put in place in connection therewith and/or the loosening~~ of ~~such~~payment ~~restrictions could adversely impact our business.~~fraud;

~~Pandemics,~~● ~~epidemics,~~profit ~~medical~~repatriation ~~emergencies~~restrictions and ~~other~~ ~~public~~foreign ~~health~~currency ~~crises~~exchange outside of our control could have a negative impact on our business. Large-scale medical emergencies can take many forms and result in widespread business interruptions due to illness and death. For example, in December 2019, a strain of coronavirus surfaced in Wuhan, China soon evolving into a global pandemic without proven medical treatments or vaccines for prevention. When vaccines started to become available demand for the vaccines exceeded the supply in the countries in which we operate. Furthermore, the vaccines were not fully effective in preventing illness. All of these factors introduced challenges in operating our business including the productivity of our employees and third-party vendors that we depend on while adjusting to shelter-in-place and health regulations. We also had to comply with an assortment of regulations specific to returning to our offices, creating additional uncertainty and confusion.restrictions;

~~Widespread~~● ~~pandemics,~~political ~~epidemics~~ or ~~other~~social ~~health crises could result in significant market volatility~~unrest, ~~regionally~~economic ~~or globally. Furthermore~~instability, health crises may disrupt or negatively impact behaviors of large numbers of users or potential users due to either mandated stay at home orders or the lifting of such orders or non-mandated changes in consumer behavior. These changes are almost impossible to predict and could either serve to acceleraterepression, ~~slow down~~ or ~~make~~human ~~user behavior~~rights ~~more volatile which could negatively impact our operating results.~~issues;

In● ~~the~~geopolitical ~~event~~events, ofincluding anatural ~~new~~disasters, ~~coronavirus~~acts ~~surge or other health emergency we plan to execute to the best~~ of ~~our~~war ~~ability recognizing that the nature~~ and ~~scope of the crisis may result in delays or changes to our goals and initiatives.~~terrorism;

~~Our~~● ~~business~~import isor ~~subject~~export ~~to economic, market, and geopolitical conditions as well as to cyber-attacks and natural disasters beyond our control.~~regulations;

~~Our~~● ~~business~~compliance iswith subject to economic, market, and geopolitical conditions, as well as natural disasters beyond our control and as a result we may experience a slowdown or cessation in customer growth, interruptions or delays in the services or a downturn in userU. ~~Further, our revenue is driven in part by discretionary consumer spending habits and by advertising spend~~S. ~~Historically,~~laws consumer purchasing and advertising spend have each declined during economic downturns and periods of economic or geopolitical uncertainty or when disposable income or consumer lending declines. Macro-economic conditions, such as athe ~~recession~~Foreign orCorrupt ~~economic~~Practices ~~slowdown in well developed markets~~Act, ~~specifically,~~ and ~~emerging~~local ~~markets,~~laws ~~more~~prohibiting ~~generally~~bribery ~~may result in uncertainty~~ and ~~adversely~~corrupt ~~affect~~payments ~~discretionary consumer spending habits and preferences as well as advertising spend. Uncertain economic conditions may also adversely affect our vendors making it virtually impossible~~ to ~~grow~~government in the event of future economic malaise. We are particularly susceptible to market conditions and risks associated with the mobile app ecosystem, which also include the popularity, price, and timing of our apps, changes in user demographics, the availability and popularity of other forms of entertainment. Furthermore, critical reviews and general tastes and preferences may change quickly and without prior warning.officials;

30● antitrust and competition regulations;

A● ~~key~~potentially ~~component~~adverse oftax ~~our growth strategy involves the adoption and utilization of artificial intelligence (AI), which introduces certain risks.~~developments;

We● ~~currently~~seasonal ~~incorporate~~volatility ~~AI into specific existing and planned products, as well as our internal operations. For instance,~~ in ~~fiscal~~business ~~2023,~~activity ~~we launched pAInt, a generative AI wallpaper maker within the Zedge App. Additionally, we have other offerings utilizing AI in soft launch or development~~ and welocal ~~view~~economic ~~this evolving technology as a key driver and focus of new products. While AI offers substantial opportunities, it also carries inherent risks to our business, reputation and financial results.~~conditions;

AI● ~~technologies~~economic ~~are~~uncertainties ~~complex~~relating ~~and~~to ~~evolving~~European ~~rapidly.~~sovereign ~~Our competitors may possess greater financial~~ and ~~technological~~other resources, providing them with a competitive edge in attracting, motivating, and retaining top AI professionals. This could pose challenges in building and maintaining our AI capabilities. In addition, market acceptance of AI technologies is uncertain, and we may be unsuccessful in product development efforts which incorporate AI. Our products offerings that use AI could fail to achieve market acceptance, or our competitors may use AI technologies more efficiently than we do.debt;

~~Furthermore,~~● ~~the use of AI brings to the forefront emerging ethical concerns. Should we introduce solutions that generate content that is misleading~~laws, ~~biased~~regulations, ~~harmful~~licensing ~~or controversial due to perceived or actual societal impact~~requirements, weand ~~may~~business ~~face~~practices ~~potential~~that ~~harm~~favor tolocal ~~our~~competitors ~~brand~~or ~~and~~prohibit ~~reputation,~~foreign ~~competitive~~ownership ~~disadvantages,~~ or ~~even legal liabilities.~~investments;

In● ~~addition~~laws, weregulations ~~are~~or ~~susceptible~~rulings tothat ~~competitive risks~~block ~~arising~~or ~~from~~limit ~~the~~access ~~rapid adoption and integration of new technologies by established industry participants, emerging startups, and other market entrants. Over time, AI tools are likely~~ to ~~enhance their accuracy and ability to handle complex tasks, potentially disrupting the landscape for educational technology businesses like ours. We must remain vigilant in~~ our ~~efforts to predict and respond to these developments in a timely and cost-effective manner.~~products;

~~Laws~~● ~~and regulations focused on the development~~different, ~~use,~~ ~~and~~uncertain ~~provision~~or ofmore AIstringent ~~technologies~~user ~~and other digital products and services are proliferating in many jurisdictions around the world. Staying compliant with evolving laws~~protection, ~~regulations~~content, ~~and~~data ~~industry standards pertaining to AI may impose significant operational costs and constrain our ability to develop~~protection, ~~deploy~~privacy, orintellectual ~~employ~~property ~~AI technologies. Failing to adapt appropriately to this evolving regulatory environment could result in legal liability, regulatory actions, monetary penalties~~ and ~~damage~~other ~~to our brand and reputation.~~laws;

~~Intellectual~~● ~~property~~risks ~~ownership~~related ~~surrounding~~to ~~AI technologies~~other ~~has~~government ~~not~~regulation, ~~been~~required ~~fully~~compliance ~~addressed~~with bylocal ~~U.S. courts or other federal or state~~ laws or ~~regulations,~~lack ~~Our ongoing development and use~~ of ~~generative AI tools may result in copyright infringement claims, disputes over ownership and licensing, and potential patent infringement claims, among other things. These~~ legal ~~challenges~~precedent; ~~could be costly to defend against, leading to substantial financial obligations~~ and reputational damage. The evolving regulatory environment and uncertain legal precedents in this field further increase our exposure to litigation risks, which could materially affect our business, financial condition, and results of operations.

~~Further,~~● ~~our~~risks ~~use~~specific ofto ~~generative~~operating AI in ~~aspects~~war-torn ~~of our~~regions ~~platforms~~where ~~may~~employees ~~present risks and challenges that could increase as AI solutions become more prevalent. AI algorithms~~ may be ~~flawed. Datasets~~mobilized ~~may~~for bearmy ~~insufficient~~service orand ~~contain~~where ~~biased~~damage ~~information. These deficiencies~~ and/or ~~other~~loss ~~failures~~ of AIlife ~~systems~~may ~~could~~occur ~~have~~when ~~negative~~under ~~impacts on our users’ experience and subject us to competitive harm, regulatory action, legal liability, and brand or reputational harm~~attack.

~~Failure~~Further, our ability to ~~detect~~expand orsuccessfully ~~prevent~~in ~~fraudulent~~foreign ~~activities~~jurisdictions oninvolves ~~our~~other ~~platform~~risks, including challenges in integrating foreign operations, ~~could~~risks ~~cause~~associated ~~users~~with entering jurisdictions in which we may have little experience and the day-to-day ~~lose~~management ~~confidence~~of a growing and increasingly geographically diverse company. We may not realize the operating efficiencies, competitive advantages or financial results that we anticipate from our investments in foreign jurisdictions. In addition, our ~~products~~international business operations could be interrupted and ~~harm~~negatively impacted by terrorist activity, war, political unrest or other economic or political uncertainties. Moreover, foreign jurisdictions could impose tariffs, quotas, trade barriers and other similar restrictions on our ~~business~~international sales.

We are ~~may be~~ subject to ~~fraudulent~~numerous and~~/or~~ ~~malicious activities~~sometimes ~~undertaken~~conflicting byU.S. ~~persons~~and ~~seeking~~foreign tolaws ~~use~~and ~~our~~regulations ~~platform~~that ~~for~~increase ~~improper~~our ~~purposes.~~cost ~~Examples~~ of ~~such~~doing ~~activities~~business. ~~include the use~~ Violations of ~~bots or~~these ~~other~~complex ~~automated~~laws orand ~~manual~~regulations ~~mechanisms~~that apply to ~~generate fraudulent activity through~~ our ~~platform,~~international ~~which~~operations could ~~generate~~result ~~revenue~~in ~~for~~damages, ~~the~~awards, ~~perpetrators~~fines, litigation, ~~and~~criminal ~~involve~~actions, ~~our~~sanctions, ~~platform~~or inpenalties ~~their~~against ~~improper~~us, ~~activity.~~our ~~Detecting~~officers ~~fraudulent~~ or ~~malicious~~our ~~activity~~employees, ~~can~~prohibitions beon ~~difficult.~~the ~~Although~~conduct weof ~~have~~our ~~implemented~~business and ~~measures~~our ability to ~~detect~~offer products and ~~reduce~~services, ~~the~~and ~~occurrence~~damage ofto ~~fraudulent~~our ~~activities,~~reputation. ~~including~~Although ~~click fraud,~~ we ~~cannot~~have ~~guarantee~~implemented ~~that~~policies weand ~~will~~procedures ~~be fully~~designed ~~successful~~to inpromote ~~doing~~compliance ~~so.~~with Ifthese welaws, ~~fail~~there tocan ~~detect~~be orno ~~prevent~~assurance ~~fraudulent~~that orour ~~other~~employees, ~~malicious activity~~contractors, itor ~~may~~agents ~~result~~will innot ~~dissuading~~violate ~~sellers~~our ~~and~~policies ~~customers~~or ~~alike~~that ~~from engaging with~~ our ~~products~~policies ~~and~~will ~~services~~be sufficient. ~~Any~~These ~~actual~~risks orinherent ~~alleged~~in ~~future~~our ~~fraudulent~~international ~~activity~~operations ~~may~~and ~~damage~~expansion increase our ~~reputation, or~~costs ~~diminish the value~~ of ~~our~~doing business ~~brand~~internationally ~~name,~~and ~~either~~could ofresult ~~which~~in ~~could~~material ~~adversely~~harm ~~impact~~to our business, operating results, ~~of operations~~ and financial condition.

3130

~~Zedge~~Conditions in isIsrael, ~~exposed~~including tothe ~~claims~~October ~~from~~7, ~~prior~~2023 ~~owners of~~attack ~~GuruShots~~by ~~objecting~~Hamas toand ~~the~~other ~~determination~~terrorist ~~that~~organizations from the ~~conditions~~Gaza ~~for~~Strip ~~payment~~and ofIsrael’s ~~the~~war against ~~earnout~~them, ~~for~~may ~~the~~adversely ~~first~~affect ~~year~~our ~~following~~operations ~~acquisition~~adversely ~~were not~~affect ~~met,~~operations and ~~that~~financial condition, particularly given the ~~user~~ongoing war ~~acquisition~~in ~~spend~~Gaza, ~~obligations~~the ~~that~~June we2025 ~~have~~’12-Day ~~made~~War’ tobetween ~~the~~Israel ~~sellers~~and ofIran, ~~GuruShots~~broader ~~are~~regional ~~not~~instability, ~~required~~and potential long-term impacts on Israel’s economy, technology sector, and foreign investment.

InPolitical, economic ~~connection~~and ~~with~~military conditions in and surrounding Israel, including the ~~acquisition~~ongoing ofwar ~~GuruShots~~in Gaza, the ~~Company~~June 2025 ~~has~~’12-Day ~~(i)~~War’ between ~~committed~~Israel toand aIran ~~retention~~and ~~pool~~related ofcross-border $4hostilities ~~million~~involving Hezbollah in ~~cash~~Lebanon toand beHouthi ~~paid~~militants toin ~~the~~Yemen, ~~founders~~may materially and ~~employees~~adversely affect our business, operations and financial condition. A portion of ~~GuruShots~~our ~~that~~personnel ~~will~~and operations are located in Israel; beaccordingly, ~~payable~~regional ~~over~~instability ~~three~~and ~~years~~escalation ~~from~~directly ~~closing~~affect ofour ~~the~~people, ~~acquisition~~facilities, ~~based~~vendors onand ~~the~~service ~~beneficiaries~~continuity ~~thereof~~(including ~~remaining~~potential airspace ~~employed~~or byinfrastructure ~~the~~disruptions, ~~Company~~cyberattacks, electricity or ~~a subsidiary;~~network ~~and~~interruptions, ~~(ii~~impaired logistics, or temporary office closures). Israeli ~~agreed~~reserve-duty tomobilizations ~~make~~may ~~certain~~require ~~minimum~~some ~~investments~~employees inor ~~user~~contractors ~~acquisition~~to serve for ~~GuruShots~~extended inperiods, ~~the~~which ~~period~~can ~~covered~~delay byproduct ~~the earnout~~development, toreduce besupport ~~contingently~~capacity ~~paid~~and toimpact ~~the~~hiring ~~prior~~and ~~owners~~retention. ofThe ~~GuruShots~~security ~~subject~~situation tocan ~~GuruShots~~also ~~maintaining~~impair ~~agreed~~domestic ~~upon~~demand, ~~levels~~international oftravel, partner ~~return~~engagement onand adsupplier ~~spend~~reliability, ~~(ROAS)~~and may increase insurance costs or leave certain risks uninsurable. Broader macroeconomic ~~GuruShots’~~effects, ~~financial~~such ~~performance~~as ~~during~~currency ~~the~~volatility, ~~period~~higher ~~from~~risk ~~the~~premia, ~~April~~capital-market ~~2022~~dislocation, ~~acquisition~~sanctions ~~through~~or ~~July~~trade 31restrictions, ~~2024~~and shifts in advertiser or consumer spending, ~~was~~could ~~materially~~further ~~impacted by~~pressure aour ~~combination~~results. ofAlthough ~~industry~~temporary ~~specific~~ceasefires have occurred, ~~macroeconomic~~cross-border rocket, drone and ~~geopolitical~~missile ~~challenges~~activity ~~that~~has ~~contributed~~persisted tointermittently, ~~negatively~~and ~~impacting~~future ~~ROAS.~~flare-ups ~~The~~or ~~conditions~~a wider regional conflict (including renewed hostilities ~~for~~with ~~payment~~Iran or coordinated attacks by Iran-aligned groups) could occur without notice. Any of ~~the~~these ~~earnout~~developments, ~~for~~together ~~the~~or ~~first~~separately, could ~~year~~disrupt ~~following~~our ~~the~~operations, ~~acquisition~~harm ~~were~~our ~~not~~ability ~~met~~to ~~and~~execute noour ~~earnout~~strategy, ~~payment~~increase ~~was~~costs, ~~made~~delay initiatives, or ~~accrued~~otherwise negatively affect our business, results of operations, cash flows and financial condition.

~~Although~~Prior to wethe ~~believe~~Hamas ~~that~~attack wein ~~have~~October ~~acted~~2023, inthe ~~compliance~~Israeli government pursued extensive changes to Israel’s judicial system, which sparked ~~with~~extensive ~~our~~political ~~obligations~~debate, wemass ~~could~~protests, beand ~~exposed~~civil tounrest. ~~liability~~In response to ~~the~~such ~~prior~~initiative, ~~owners~~many ofindividuals, ~~GuruShots.~~organizations ~~One~~and ofinstitutions, both ~~the~~within ~~prior~~and ~~owners~~outside of ~~GuruShots~~Israel, ~~has~~have ~~objected to~~voiced concerns that the ~~determination~~proposed ~~that~~changes may negatively impact the ~~conditions~~business ~~for~~environment ~~payment~~in Israel including due to reluctance of ~~the~~foreign ~~earnout~~investors ~~for~~to ~~the~~invest ~~first~~or ~~year~~transact ~~following~~business ~~acquisition~~in ~~were~~Israel ~~not~~as ~~met.~~well Weas ~~responded~~ to ~~the~~increased ~~objection~~currency fluctuations, downgrades in ~~great~~credit ~~detail~~rating, increased interest rates, increased volatility in security markets, and ~~believe~~other changes in macroeconomic conditions. The risk of such negative developments has increased in light of the ~~assertion~~war towith beHamas. ~~without~~To ~~merit~~the extent that any of these negative developments do occur, they may have an adverse effect on our business and our results of operations.

~~The~~In addition, ~~GuruShots~~recent ~~acquisition~~political uprisings and conflicts in various countries in the Middle East, including Syria and Lebanon, are affecting the political stability of those countries. In addition, the ongoing threats that Iran and various extremist groups in the region make against Israel may ~~fail~~escalate toin ~~yield~~the future and turn violent, which could affect the Israeli economy in general and us in particular. Any ~~growth~~armed ~~opportunities~~conflicts, terrorist activities or political instability in the region could adversely affect business conditions, harm our results of operations and ~~achieve~~make ~~beneficial~~it ~~synergies~~harder for us to raise capital.

~~Zedge~~For the ~~acquired~~most ~~GuruShots~~part, ~~with~~we ~~the~~do ~~expectation~~ not have commercial insurance that ~~the~~cover ~~transaction~~losses ~~will~~that ~~yield~~may ~~growth~~occur onas a ~~standalone~~result ~~basis~~of an event associated with the security situation in Israel. ToAlthough ~~date~~the ~~this~~Israeli government has ~~not~~in ~~been~~the past covered the ~~case.~~reinstatement Invalue ~~addition,~~of ~~the~~certain ~~acquisition~~damages ~~was~~that ~~meant~~were caused toby ~~deliver~~terrorist ~~strategic~~attacks ~~synergies~~or onacts aof ~~combined~~war, ~~basis.~~we ~~Our~~cannot ~~success~~assure inyou ~~realizing~~that ~~these~~this ~~growth~~government ~~opportunities~~coverage ~~and~~will ~~strategic~~be ~~synergies~~maintained or, ~~and~~if ~~their~~maintained, will be ~~associated~~sufficient ~~timing~~to ~~depends,~~compensate ~~amongst~~us ~~other~~fully ~~things,~~for ondamages ~~the~~incurred. ~~successful~~Any ~~integration~~losses ofor ~~the~~damages ~~respective~~incurred ~~businesses.~~would ~~Even~~likely ifcause wea ~~are~~significant ~~successful~~disruption in ~~with~~our ~~the~~employees’ ~~integration~~lives and possibly put their lives at risk, ~~there~~which iswould nohave ~~guarantee~~a ~~that~~material adverse effect on our operations. Any armed conflicts or political instability in the ~~strategic~~region ~~synergies~~would ~~that~~likely wenegatively ~~envisioned~~affect ~~will~~business ~~bear~~conditions ~~fruit~~generally and could harm our results of operations.

~~Future~~Additionally, in ~~strategic~~the ~~alliances~~past, orthe ~~acquisitions~~State of Israel and Israeli companies have been subjected to economic boycotts. Several countries still restrict business ~~may~~with ~~not~~the beState ~~successful~~of Israel and ~~may~~with ~~have~~Israeli acompanies. ~~material~~These restrictive laws and policies may have an adverse ~~effect~~impact on our results of operations, financial conditions or the expansion of our business. A campaign of boycotts, ~~reputation~~divestment and ~~results~~sanctions ofhas ~~operations~~been undertaken against Israel, which could also adversely impact our business.

We may enter into strategic alliances, including joint ventures or minority equity investments, or acquisitions with various third parties to further our business purpose from time to time. These alliances and acquisitions could subject us to a number of risks, including risks associated with sharing proprietary information, non-performance by the third party and increased expenses in establishing new strategic alliances, any of which may materially and adversely affect our business. We may have limited ability to monitor or control the actions of these third parties and, to the extent any of these strategic third parties suffer negative publicity or harm to their reputation from events relating to their business, we may also suffer negative publicity or harm to our reputation by virtue of our association with any such third party.31

~~In addition, if appropriate opportunities arise,~~We wehave ~~may~~offices ~~acquire additional assets, products, technologies or businesses that we believe are complementary to our existing business. Future acquisitions~~ and ~~the~~other ~~subsequent integration of new assets and businesses into our own would require~~ significant ~~attention~~operations ~~from~~in ~~our~~Lithuania ~~management~~ and ~~could result in a diversion of resources from our existing business~~Israel, ~~which in turn could have an adverse effect on our business operations. Acquired assets or businesses may not generate the financial results we expect~~ and ~~could require the use of substantial amounts of cash~~, ~~potentially~~ ~~dilutive issuances of equity securities~~therefore, ~~the~~our ~~occurrence~~results of significant goodwill impairment charges, amortization expenses for other intangible assets and exposure to potential unknown liabilities of the acquired business. Moreover, the costs of identifying and consummating acquisitions may be ~~significant.~~adversely Inaffected ~~addition~~by ~~to possible stockholders’ approval~~political, ~~we may also have to obtain approvals~~ ~~and~~economic ~~licenses from relevant government authorities for the acquisitions~~ and tomilitary ~~comply~~instability ~~with any applicable laws and regulations, which could result~~ in ~~increased~~these ~~delay and costs~~countries.

32The overwhelming majority of our employees are located in Lithuania and Israel and many of our senior managers live in these countries. For those that reside in Israel and Lithuania political, economic and military conditions directly affect our business. Any hostilities involving these countries or the interruption or curtailment of trade between these countries and their trading partners could adversely affect our business and results of operations. Furthermore, there is always the chance that the citizens in these countries will be required to serve in the army or perform public duty in the event of an armed conflict.

~~LEGAL~~The Republic ~~AND~~of ~~REGULATORY~~Lithuania ~~RISKS~~borders both the Russian exclave of Kaliningrad and the Republic of Belarus, who are aligned in Russia’s illegal invasion of Ukraine. This places Lithuania at a higher risk of military conflict, may negatively impact the ability to travel to and from Lithuania, and may damage its economy. This action also negatively impacted GuruShots because it utilizes a small number of outsourced contractors based in Ukraine. This resulted in temporarily disrupting the work product associated with these contractors at the outset of the war.

~~Legal~~Companies and governmental agencies may restrict access to our website or ~~regulatory~~mobile ~~proceedings~~apps, or ~~allegations of~~the ~~impropriety~~internet generally, which could ~~have~~lead ato ~~material~~the ~~adverse~~loss or ~~impact~~slower ongrowth of our ~~reputation~~user base, in which case our business and results of operations, ~~financial~~may ~~condition~~be materially and ~~liquidity~~adversely affected.

WeIn order ~~have~~to ~~been~~grow ~~party~~our business, users need to access the internet and, in ~~the~~particular, ~~future~~our ~~may~~digital ~~become~~products. Companies and governmental agencies ~~subject~~could block access to ~~new~~our ~~legal~~websites ~~proceedings~~and inapps or the ~~operation~~internet ofgenerally. ~~our~~For ~~business~~example, ~~including,~~in ~~but~~2013 ~~not~~the ~~limited~~Indian courts issued orders restraining internet service providers from providing access to, ~~with~~various ~~respect~~internet domains including ours. Access to ~~alleged~~our ~~breaches~~Zedge ofApp through any mode ~~consumer~~was ~~privacy~~blocked ~~regulations,~~in ~~employee~~many ~~matters,~~parts ~~alleged~~of ~~service~~India from February 2013 until August 2019 and ~~system~~there ~~malfunctions,~~can ~~alleged~~be ~~intellectual~~no ~~property~~guaranties ~~violations~~that ~~and~~this will not recur or happen ~~claims~~elsewhere. ~~relating~~If tocompanies ~~our~~or ~~contracts,~~governmental ~~licenses~~entities ~~and~~block ~~strategic~~or ~~investments.~~limit ~~Furthermore,~~access weto ~~may~~our beZedge ~~included~~App inor ~~lawsuits~~otherwise asadopt ~~third-party~~policies ~~defendants due~~restricting access to ~~the~~our ~~use~~advertiser’s of products orand services ofour ~~the~~business ~~primary~~could ~~defendant.~~be Wenegatively ~~may~~impacted ~~also~~resulting bein ~~subject~~a toloss ~~fraudulent~~or ~~claims~~slow-down ~~from~~of ~~parties~~user ~~like patent~~growth ~~trolls~~and/or revenues.

~~Additional legal proceedings targeting our products~~Our ~~and~~core ~~services~~values ~~and claiming violations~~ of ~~state~~focusing ~~or federal laws could occur, based~~ on ~~the~~our ~~unique~~users and ~~particular~~acting ~~laws~~for ~~of each jurisdiction, particularly as litigation claims and regulations continue to evolve. We cannot predict~~ the ~~outcome~~long-term ~~of any legal proceedings to which we~~ may beconflict awith ~~party,~~the ~~any~~short-term interests of ~~which could have a material adverse effect on~~ our ~~results of operations, cash flows or financial condition~~business.

AsOne of ~~noted~~our ~~above~~core values is providing an excellent user experience, which we ~~have~~believe ~~responded~~is essential to aour ~~claim~~success ~~from~~and serves the best, long-term ~~one~~interests of us and our stockholders. Therefore, we have made in the ~~prior~~past, ~~owners~~and/or ofmay ~~GuruShots~~make in the future, ~~who~~significant ~~objected~~investments toor changes ~~our~~in ~~determination~~strategy that we think will benefit our users, even if our decision negatively impacts our operating results in the ~~conditions~~short term. ~~for~~In ~~payment~~addition, our philosophy of ~~the~~prioritizing ~~earnout~~our ~~for~~users ~~the~~may ~~first~~cause ~~year~~disagreements or negatively impact our relationships with advertisers ~~following~~or ~~acquisition~~other ~~were~~third parties. Our decisions may not ~~met.~~result Wein ~~believe~~the long-term benefits that we expect, in which case the ~~assertion~~success toof our business and operating results could be ~~without~~materially ~~merit~~harmed.

~~A variety of new and existing U.S. and foreign~~If ~~government~~we ~~laws~~are ~~and~~unable ~~regulations could subject us~~ to ~~claims,~~attract ~~judgments, monetary liabilities~~ and ~~other~~retain ~~remedies,~~highly ~~and~~qualified ~~to limitations on our business practices~~employees, inwe ~~which case our business and results of operations~~ may not be ~~materially~~able ~~and~~to ~~adversely~~grow ~~affected~~effectively.

WeOur ability ~~are~~to ~~subject~~compete toand ~~numerous~~grow ~~U.S.~~depends ~~and~~in ~~foreign~~large ~~laws and~~part ~~regulations~~on ~~covering~~the aefforts ~~wide~~and ~~variety~~talents of ~~subject~~our ~~matters~~employees. ~~New~~Such ~~laws~~employees, particularly product managers, designers and ~~regulations~~engineers, ~~changes~~are in ~~existing~~high ~~laws~~demand, and ~~regulations~~we ordevote ~~the interpretation~~significant ofresources ~~them~~to identifying, ~~our~~hiring, ~~introduction~~training, ofand ~~new~~successfully ~~products,~~integrating and orretaining anthese ~~extension~~employees. ofThe ~~our~~specialized ~~business~~nature ~~into~~of ~~new~~AI ~~areas~~development ~~could~~further ~~increase~~intensifies ~~our~~competition ~~future~~for ~~compliance costs~~skilled personnel, ~~make~~and ~~our~~challenges in ~~products~~attracting and ~~services~~retaining ~~less~~qualified ~~attractive~~AI toprofessionals ~~our~~could ~~users,~~impede ~~introduce~~our ~~litigation~~ability ~~exposure, or cause us~~ to ~~change~~innovate orand ~~limit~~maintain our ~~business~~ ~~practices.~~AI systems effectively. We may ~~incur~~need ~~substantial expenses~~ to ~~comply~~offer ~~with~~competitive ~~laws~~compensation and ~~regulations~~invest orin ~~defend~~training ~~against~~programs ato ~~claim~~build ~~that~~and wesustain ~~have~~our ~~not~~AI ~~complied with~~capabilities, ~~them~~increasing operational costs. ~~Further,~~The ~~any~~loss ~~failure~~of onemployees ~~our~~or ~~part~~the inability to ~~comply~~hire ~~with~~additional ~~any~~skilled ~~relevant~~employees ~~laws~~as ornecessary ~~regulations~~could ~~may~~result ~~subject~~in ussignificant disruptions to ~~significant~~our ~~civil~~business, orand ~~criminal liabilities,~~the ~~penalties,~~integration ~~taxes,~~of ~~fees,~~replacement ~~costs,~~personnel ~~reputational~~could ~~harm,~~be ~~competitive~~time-consuming ~~damage~~and expensive and ~~negative~~cause ~~publicity~~additional disruptions to our business.

~~The application of existing domestic and international~~We ~~laws~~operate ~~and~~a ~~regulations~~development tocenter usin ~~relating to issues such as user privacy and data protection~~Vilnius, ~~artificial~~Lithuania. ~~intelligence,~~If ~~security,~~we ~~defamation, pricing,~~are ~~advertising,~~unable ~~taxation,~~to ~~gambling,~~recruit ~~sweepstakes, promotions, consumer protection, artificial intelligence~~ and ~~machine~~retain ~~learning, accessibility,~~well ~~content~~qualified ~~regulation,~~candidates ~~quality~~at ofan ~~services, law enforcement demands, telecommunications, mobile, and intellectual property~~attractive ~~ownership~~rate ~~and infringement in many instances is unclear~~ or ~~unsettled.~~manage ~~Further~~them well, ~~the application to us or~~ our subsidiaries of existing laws regulating or requiring licenses for certain businesses of our advertisers can be unclear. U.S. export control laws and regulations also impose requirements and restrictions on exports to certain nations and persons and on our business. ~~Internationally,~~will westruggle ~~may also be subject~~ to ~~laws~~meet ~~regulating~~ our ~~activities~~development ingoals ~~foreign countries~~ and ~~to foreign laws and regulations that are inconsistent from country to country~~objectives. ~~Any~~ ~~new~~In ~~legislation,~~fiscal in2021 ~~the~~we ~~U.S.~~adopted ~~or abroad, may be difficult to comply with in~~ a ~~timely and comprehensive manner and may expose our business~~“remote-first” towork ~~increased~~policy ~~costs.~~that Ifenabled ~~the~~employees ~~rules, doctrines or currently available defenses change, if international jurisdictions refuse~~ to ~~apply~~work ~~protections similar~~from tohome ~~those~~unless ~~that~~they ~~are~~were ~~currently~~needed ~~available~~ in the Uoffice.S. orIn ~~the~~fiscal ~~EU,~~2023 orwe ifchanged athis ~~court~~policy ~~were~~ to ~~disagree with our application of those rules~~ toa ~~our~~hybrid ~~solutions,~~model ~~our~~requiring ~~potential~~most ~~liability~~employees ~~for information or content created by third parties and posted~~ to ~~our~~work ~~platform~~from ~~could require us to expend significant resources to try to comply with~~ the ~~new~~office ~~rules~~several ~~and~~days ~~implement~~a ~~additional~~week. ~~measures~~Although tothis ~~reduce~~policy ~~our~~has ~~exposure~~been towell ~~such liability~~received orby ~~we could incur liability and our business~~employees, it ~~financial~~is ~~condition~~as ~~and~~of ~~results~~yet ofunclear ~~operations~~whether ~~could~~it will be ~~harmed~~further revised.

In addition, the Digital Millennium Copyright Act (the “DMCA”) has provisions that limit, but do not necessarily eliminate, our liability for caching, hosting, listing or linking user-generated materials that infringe copyrights, so long as we comply with the statutory requirements in the DMCA. The Communications Decency Act (the “CDA”) further helps to limit our potential liability for certain content uploaded onto our platform by third parties. For example, Section 230 of the CDA provides immunity from liability for providers of an interactive computer service who publish tortious and otherwise illegal content provided by users of the service. While the immunity provisions of the DMCA and the CDA are well established, there are regular cases seeking to limit the application of such immunity. Various U.S. and international laws restrict the distribution of materials considered harmful to children and impose additional restrictions on the ability of online services to collect information from minors. In the area of data protection, every state has passed a law requiring notification, and at times, the provision of identity theft protection, to users when there is a security breach for personal data. We face similar risks and costs as our products and services are offered in international markets and may be subject to additional regulations.32

33In April of 2022 we completed the acquisition of GuruShots Ltd, an Israeli based company. GuruShots utilized a small number of outsourced contractors based in Ukraine. Russia’s illegal invasion of Ukraine in February 2022 resulted in temporarily disrupting the work product associated with these contractors. Furthermore, Zedge employees situated in Vilnius were distracted due to the proximity to the Belarusian border and uncertainty related to Belarus’ complicity with Russia’s illegal action and associated intent. In addition, consumer prices have risen materially throughout the Eurozone leaving uncertainty about how this may impact employment costs in the future.

In October ~~many~~of 2023 Hamas, ~~but~~a ~~not~~designated ~~all~~terrorist organization, ~~territories~~launched ~~outside~~a ofsavage ~~the U.S.~~terror ~~there~~attack ~~are~~in ~~laws~~Israel ~~similar~~along towith ~~the~~launching ~~DMCA~~thousands of ~~that~~rockets ~~exempt~~into usIsraeli ~~from~~sovereign ~~copyright~~territory. ~~infringement~~The ~~liability~~State ~~that~~of ~~may~~Israel ~~arise~~declared ~~due~~war toagainst ~~hosting~~Hamas ~~user-uploaded~~resulting in the mobilization of more than ~~materials~~300,000 army reserve. In ~~some~~addition, ~~countries~~Hezbollah, ~~particularly~~another designated terrorist organization, based in ~~Europe~~Lebanon, has been indiscriminately shelling Israeli territory. Some GuruShots employees were impacted and the ~~Asia-Pacific~~regular ~~region~~and consistent rocket barrage is taking a toll on productivity. Coupled with this, ~~these~~most, ~~laws~~if not all, schools are ~~being~~along ~~readjusted~~with our office closed making the work environment complex. In June of 2025 Israel and ~~new,~~Iran entered into the ’12-Day War’ during which our office and ~~potentially~~schools were closed and there were shelter ~~burdensome,~~in ~~constraints~~place ~~are~~orders ~~being~~that ~~imposed~~were ~~onto~~issued. ~~service~~The ~~providers~~constant barrage of ballistic missiles launched from Iran and Yemen interrupted our operations.

~~For~~We believe ~~example~~that two critical components of our success are our ability to retain our best people by preserving our culture and maintaining competitive compensation practices. As we continue to grow rapidly, and we develop the ~~European~~infrastructure ~~Union’s~~of ~~Directive~~a public company, we may find onit ~~Copyright~~difficult into ~~the~~maintain ~~Digital~~our ~~Single~~entrepreneurial, ~~Market~~execution-focused (culture. In addition, depending on the ~~“DSM~~performance ~~Directive”)~~of isour stock price some of our employees are able to receive material proceeds from sales of our equity in ~~effect~~the ~~and~~public ~~has~~markets, ~~been~~which ~~implemented~~may byreduce ~~all~~their EUmotivation to ~~Member~~continue ~~States~~to work for us.

~~The~~We rely ~~DSM~~on ~~Directive~~third ~~Article~~parties 17to ~~removes~~provide the ~~shield of the current ‘hosting exemption~~technologies,’ ~~enshrined~~including incloud ~~the Electronic Commerce Directive (2000/31/EC) (the “E-Commerce Directive”)~~services, ~~and~~ ~~replaces~~necessary itto ~~with~~deliver ~~a principle of full liability where “online~~ content, ~~sharing~~advertising, ~~service~~and ~~providers” (“OCSSPs”)~~services ~~are~~to ~~concerned.~~our ~~This means that OCSSPs will be liable for copyright-protected material uploaded by~~ users, and ~~must~~any ~~obtain~~change ~~authorization (i.e.,~~in ~~a license) from~~ the ~~relevant~~licensing ~~rightsholders.~~terms, ~~However~~costs, ~~Article~~availability, 17or ~~effectively~~acceptance ~~creates~~of athese ~~new~~formats ~~liability~~and ~~exemption~~technologies ~~regime~~could ~~for OCSSPs~~materially ~~(albeit~~adversely aaffect ~~more~~our onerous one than is currently provided by the E-Commerce Directive) under which OCSSPs will not be liable for the copyright-protected works that they communicate to the public provided that they cooperate with rightsholders by:business.

●Our service ~~making~~and ~~best~~hosting ~~efforts~~providers may experience downtime from time to ~~obtain~~time, which may negatively affect our brand and user perception of the ~~necessary~~reliability ~~authorization~~of (iour service.e Any scheduled or unscheduled interruptions in service could result in an immediate, and possibly substantial, loss of revenues. Although we seek to reduce the possibility of disruptions or other outages, our websites and apps may be disrupted by problems relating either to our own technology or third-party technology that is used for them. Our systems may be vulnerable to damage or interruption from telecommunication failures, power loss, computer or hacking attacks or viruses, earthquakes, floods, fires, terrorist attacks and similar events. Parts of our system are not fully redundant or backed up, and our disaster recovery planning may not be sufficient for all eventualities. Despite any precaution we may take, the occurrence of a ~~license);~~natural disaster or other unanticipated problems at our hosting facilities could result in lengthy interruptions in the availability of our products. Any interruption in the ability of users to access our websites or apps could reduce our future revenues, harm our future profits, subject us to regulatory scrutiny and lead users to seek alternative internet mobile products. In addition, a hacking attack or another security incident, could result in unauthorized access to, damage to, disablement or encryption of, use or misuse of, disclosure of, modification of, destruction of, or loss of our data or our developers’, creators’, and users’ data or disrupt our ability to provide our platforms or services.

●There can ~~expeditiously~~be ~~taking~~no ~~down~~assurance that these providers will continue licensing their technologies or ~~disabling~~intellectual ~~access~~property to ~~content~~us ~~upon~~on ~~receiving~~reasonable aterms, or ~~sufficiently~~at ~~substantiated~~all. ~~notice~~Providers tomay dochange sothe byfees ~~rightsholders~~they (icharge users or otherwise change their business model in a manner that slows the widespread acceptance of their technologies.~~e.,~~ ~~similar~~Any tochange in the ~~existing~~licensing ~~‘notice~~terms, costs, availability, or user acceptance of these technologies could materially and ~~take-down’~~adversely ~~requirements);~~affect our business, revenues and profitability.

● making best efforts to prevent future uploads of content in respect of which they have received a notice from rightsholders pursuant to the previous requirement (i.e., a ‘notice and stay down’ requirement); and33

●We track ~~making~~certain ~~best~~key ~~efforts,~~performance inindicators ~~accordance~~ with ~~high~~internal ~~industry~~and ~~standards~~third-party oftools ~~professional~~and ~~diligence,~~do tonot ~~ensure~~independently ~~the~~verify ~~unavailability~~that all of ~~specific~~this ~~works~~data inis accurate. ~~respect~~Certain of ~~which~~these ~~rightsholders~~indicators may have ~~provided~~challenges ~~the~~in ~~‘relevant~~being ~~and~~tracked ~~necessary~~accurately ~~information~~which could result in real or perceived inaccuracies that could negatively impact our business.’

~~The~~We track ~~article~~certain ~~also~~key ~~extends~~performance ~~any~~indicators, ~~licenses~~including ~~granted~~daily active users, monthly active users, purchasers, and paying subscribers using both internal and third-party tracking tools. Our analytical tools have certain limitations, including those from third-party providers, and our ability to ~~OCSSPs~~access and monitor this data may change, which would adversely impact our ability to ~~their~~track ~~users~~these KPIs. If the internal or external tools we use to track data contain bugs we may make poor decisions, asespecially ~~long~~when asit ~~those~~comes ~~users~~to ~~are~~paid ~~not~~user ~~acting~~acquisition, “based on aflawed ~~commercial~~and ~~basis~~inaccurate data which can hurt our reputation and financial position.”

~~Additionally, our increased~~ We use ofopen-source ~~artificial intelligence~~software ~~(AI), including generative AI,~~ in our ~~product~~platform ~~offerings~~that ~~presents additional risks. Namely, uncertain legal and regulatory treatment around the provision and use of such technologies, for example in the areas of privacy and intellectual property,~~ may ~~create increased~~subject ~~and uncertain litigation exposure, the possibility of regulatory scrutiny, costly compliance requirements and limit or prohibit certain of~~ our ~~product~~technology ~~offerings. Compliance with these laws and regulations may be onerous and expensive, and may be inconsistent from jurisdiction~~ to ~~jurisdiction,~~general ~~further~~release ~~increasing the cost of compliance and the risk of liability. Any such increase in costs~~ or ~~increased risk~~require of liability as a result of changes in these laws and regulations or in their interpretation could individually or in the aggregate make our products and services that use AI technologies less attractive to our users, cause us to ~~change~~re-engineer ~~or limit~~ our ~~business practices or affect our financial condition and operating results. Moreover~~solutions, ~~AI may produce content seen as infringing upon the rights of others,~~ ~~including~~which ~~with respect to copyrights. Additionally, AI~~ may ~~create~~cause ~~flawed,~~materially ~~biased,~~harm ~~harmful, misleading, inaccurate, or unexpected outputs and content, creating risks~~ to our business~~, partners, and users~~.

~~Although~~We use weopen-source ~~have~~software ~~invested~~in ~~and~~connection ~~continue~~with our services. From time to ~~invest~~time, companies that incorporate open-source software into their inproducts ~~systems~~have faced claims challenging the ownership of open-source software and/or ~~resources~~compliance with open-source license terms. Therefore, we ~~which~~could ~~are~~be ~~intended~~subject to ~~ensure~~lawsuits ~~that~~by parties claiming ownership of what we ~~are~~believe ~~compliant~~to be open-source software or noncompliance with ~~the~~open-source licensing ~~requirements~~terms. ofSome ~~the~~open-source ~~GDPR,~~software ~~CCPA,~~licenses ~~DMCA,~~require ~~the~~users ~~DSM~~who ~~Directive and~~distribute ~~other~~or ~~U.S.~~make ~~and~~available ~~international~~open-source ~~laws~~software ~~relating~~as part of their software to, ~~among~~publicly ~~other~~disclose ~~things,~~all ~~materials~~or ~~that~~part ~~infringe~~of onthe ~~copyrights~~source code to such software and/or ~~contain~~make ~~other~~available ~~objectionable content,~~any ~~our~~derivative ~~systems~~works ~~may~~of ~~not~~the beopen-source code ~~sufficient~~on unfavorable terms or at no cost. While we ~~may~~monitor ~~unintentionally~~our ~~err~~use of open source software and ~~fail~~try to ~~comply~~ensure ~~with~~that ~~these~~none ~~laws~~is ~~and~~used ~~regulations~~in ~~which~~a ~~could~~manner ~~expose~~that would require us to ~~claims,~~disclose ~~judgments,~~the ~~monetary~~source ~~liabilities~~code ~~and~~or ~~other~~that ~~remedies~~would otherwise breach the terms of an open-source agreement, such use could nevertheless occur and we may be required to ~~limitations~~release our proprietary source code, pay damages for breach of contract, re-engineer our applications, discontinue use in the event re-engineering cannot be accomplished on a timely basis or take other remedial action that may divert resources away from our ~~business~~development ~~practices~~efforts, any of which could materially and adversely affect our business, ~~and~~ financial condition or operating results.

34Our business, results of operation and financial condition could be adversely affected by the Covid 19 pandemic, other global epidemics and the restrictions put in place in connection therewith and/or the loosening of such restrictions could adversely impact our business.

~~Data~~Pandemics, epidemics, ~~privacy~~medical emergencies and ~~security~~other ~~laws~~public ~~and~~health ~~regulations~~crises outside of our control could have a negative impact on our business. Large-scale inmedical ~~the~~emergencies ~~jurisdictions~~can intake ~~which~~many weforms doand result in widespread business ~~subject~~interruptions usdue to ~~possible~~illness ~~sanctions~~and death. For example, ~~civil~~in ~~lawsuits~~December 2019, ~~(including~~a ~~class~~strain ~~action~~of orcoronavirus ~~similar~~surfaced ~~representative~~in Wuhan, China soon evolving into a global pandemic without proven medical treatments or vaccines ~~lawsuits)~~for ~~and~~prevention. ~~other~~When ~~penalties~~vaccines started to become available demand for the vaccines exceeded the supply in the ~~event~~countries ofin ~~non-compliance,~~which ~~additionally~~we operate. Furthermore, the ~~need~~vaccines towere ~~observe~~not fully effective in preventing illness. All of these ~~regulations~~factors ~~increases~~introduced challenges in operating our business including the ~~cost~~productivity of ~~doing~~ ~~business~~our employees and ~~these~~third-party ~~laws~~vendors that we depend on while adjusting to shelter-in-place and health regulations. ~~are~~We ~~continually~~also ~~evolving.~~had ~~Compliance~~to ~~failure~~comply ~~either~~with byan usassortment orof regulations specific to returning to our ~~partners~~offices, orcreating ~~vendors could~~additional ~~harm~~uncertainty ~~our~~and ~~business~~confusion.

~~Our business relies on collecting, processing,~~Widespread ~~storing~~pandemics, ~~using~~epidemics ~~and~~or ~~sharing~~other ~~data,~~health ~~some~~crises ofcould ~~which~~result ~~contains~~in ~~personal~~significant ~~information~~market volatility, ~~including~~regionally ~~the~~or ~~personal~~globally. ~~information~~Furthermore, ofhealth crises ~~our~~may ~~users.~~disrupt ~~Our~~or ~~business is~~negatively ~~therefore~~impact ~~subject~~behaviors toof alarge ~~number~~numbers of ~~federal,~~users ~~state,~~or ~~local~~potential ~~and~~users ~~foreign~~due ~~laws,~~to ~~regulations,~~either ~~regulatory~~mandated ~~codes~~stay ~~and~~at ~~guidelines~~home ~~governing data~~orders ~~privacy,~~or ~~data~~the ~~protection~~lifting ~~and~~of ~~security,~~such ~~including~~orders ~~with~~or ~~respect~~non-mandated tochanges ~~the~~in ~~collection,~~consumer ~~storage,~~behavior. ~~use,~~These ~~processing,~~changes ~~transmission,~~are ~~sharing~~almost impossible to predict and ~~protection~~could ofeither ~~personal~~serve ~~information.~~to ~~Such laws~~accelerate, ~~regulations,~~slow ~~regulatory~~down ~~codes~~or ~~and~~make ~~guidelines~~user ~~may~~behavior bemore ~~inconsistent~~volatile ~~across~~which ~~jurisdictions~~could ornegatively ~~conflict with~~impact ~~other~~our ~~rules~~operating ~~and change regularly~~results.

~~For example, on July 10, 2023,~~ In the ~~European~~event ~~Commission adopted~~of ~~its~~a ~~adequacy decision relating to the~~ new ~~EU-U.S.~~coronavirus ~~Data~~surge ~~Privacy~~or ~~Framework~~other ~~(“DPF”).~~health ~~This~~emergency ~~was~~we ~~followed~~plan byto ~~the~~execute ~~UK Government’s approval of the UK extension~~ to the ~~DPF,~~best ~~which is effective as~~ of ~~October~~our ~~12,~~ability ~~2023.~~recognizing ~~The~~that ~~DPF and UK extension are now lawful means for transferring personal data from~~ the ~~European Economic Area (“EEA”), or the UK to the U.S. (in addition to Standard Contractual~~nature ~~Clauses (“SCCs”)). The DPF (~~and ~~the~~scope ~~associated~~of ~~steps that~~ the ~~U.S.~~crisis ~~Government~~may ~~has~~result ~~taken~~ in ~~connection~~delays ~~with the DPF) should improve the ability for personal data to flow from the EEA~~ or UKchanges to ~~the U.S., however the DPF is likely to be subject to challenge and may be invalidated in the future. While this does not present an immediate risk to~~ our ~~business,~~goals ~~monitoring~~ and ~~ensuring compliance with shifting data transfer requirements could result in additional costs incurred~~initiatives.

In addition, the EU General Data Protection Regulation 2016/679 (“GDPR”) and the UK General Data Protection Regulation (the “UK GDPR”), incorporating the GDPR into UK law, impose more stringent data protection requirements, provide an enforcement authority which substantially increases compliance costs, and impose large penalties for noncompliance. Such laws and regulations may require companies to implement new privacy and security policies, conduct processing or transfer impact assessments, permit individuals to access, correct and delete personal information stored or maintained by such companies, inform individuals of security breaches that affect their personal information, and, among other things, obtain individuals’ consent to use personal information for certain purposes. In addition, some countries have enacted, or are currently considering, legislation that imposes local storage and processing of data to avoid any form of transfer to a third country, or other restrictions on transfer and disclosure of personal data outside of that country which may impact our compliance obligations, potentially exposing us to liability, and increase the cost and complexity of delivering our products and services.34

~~In June 2018, California passed the California~~Our ~~Consumer~~business ~~Privacy Act (“CCPA”), effective January 1, 2020. The CCPA~~ is asubject ~~privacy law that provides consumers significant rights over the use of their personal information, including the right~~ to ~~object to the “sale” of their personal information. Amendments to the CCPA under the California Privacy Rights Act (“CPRA”)~~economic, ~~effective January 1~~market, ~~2023,~~and ~~expand~~geopolitical ~~some~~conditions ofas ~~the~~well ~~CCPA~~as ~~rights~~ to ~~residents~~ tocyber-attacks ~~restrict~~and ~~the~~natural ~~use~~disasters ofbeyond ~~certain information. These laws may restrict~~ our ~~ability to use personal information in connection with our business operations, and along with other state laws, such as the California Online Privacy Protection Act, create compliance obligations~~control. ~~The CCPA also provides a private right of action for certain data breaches.~~

~~Additionally~~Our business is subject to economic, ~~alongside~~market, ~~California~~and geopolitical conditions, ~~several~~as ~~other states~~well ~~have~~as ~~also~~natural ~~enacted~~disasters ~~comprehensive~~beyond ~~consumer~~our ~~data~~control ~~privacy~~and ~~laws~~as ~~that~~a ~~are~~result we ~~currently~~may ~~effective~~experience a slowdown or ~~will~~cessation ~~become~~in ~~effective~~customer growth, interruptions or delays in the ~~coming years~~services or a downturn in user. ~~Moreover~~Further, our ~~some~~revenue ~~U.S.~~is ~~states~~driven ~~have~~in ~~more~~part ~~specific~~by discretionary consumer ~~data~~spending ~~privacy~~habits ~~requirements,~~and ~~some~~by ~~with~~advertising ~~onerous~~spend. ~~notice~~Historically, ~~consent,~~consumer purchasing and advertising ~~other~~spend have each declined during economic downturns and periods of economic or geopolitical uncertainty or when disposable ~~obligations~~income or consumer lending declines. ~~These~~Macro-economic ~~laws~~conditions, ~~generally~~such ~~place~~as ~~limitations~~a onrecession ~~the~~or ~~collection~~economic slowdown in well developed markets, ~~processing~~specifically, and emerging markets, more generally may result in uncertainty and ~~use~~adversely ofaffect discretionary consumer ~~personal~~spending ~~information~~habits and ~~create~~preferences ~~data~~as ~~privacy~~well ~~and~~as ~~protection~~advertising ~~compliance~~spend. ~~obligations~~Uncertain ~~for~~economic ~~businesses~~conditions ~~covered~~may ~~under~~also ~~the~~adversely ~~law~~affect ~~(the~~our ~~jurisdictional~~vendors ~~requirements~~making ofit ~~which~~virtually ~~may~~impossible to grow ~~vary).~~in ~~Some~~the event of future economic malaise. We are particularly susceptible to market conditions and risks associated with the ~~laws~~mobile ~~specifically~~app ecosystem, ~~regulate~~which also include the ~~processing~~popularity, price, and timing of ~~information~~our ~~from~~apps, ~~individuals~~changes ~~under~~in user demographics, the ~~age~~availability and popularity of 18other forms of entertainment. Furthermore, critical reviews and general tastes and preferences may change quickly and without prior warning.

~~Furthermore, all 50 U.S. states, the District~~Failure ofto ~~Columbia,~~detect ~~and~~or ~~the~~prevent ~~U.S.~~fraudulent ~~territories~~activities ~~have~~on ~~enacted~~our ~~breach~~platform ~~notification~~could ~~laws~~cause ~~which~~users ~~require notification~~ to ~~individuals~~lose ~~(and~~confidence ~~potentially regulators and other parties)~~ in ~~the~~our ~~event~~products ~~of certain data breaches impacting personal information. In addition, there has been a significant increase in putative class action activity under privacy~~ and ~~privacy-related~~harm ~~laws,~~our ~~often with claims for statutory damages and demands for changes in~~ business ~~operations~~.

35We may be subject to fraudulent and/or malicious activities undertaken by persons seeking to use our platform for improper purposes. Examples of such activities include the use of bots or other automated or manual mechanisms to generate fraudulent activity through our platform, which could generate revenue for the perpetrators and involve our platform in their improper activity. Detecting fraudulent or malicious activity can be difficult. Although we have implemented measures to detect and reduce the occurrence of fraudulent activities, including click fraud, we cannot guarantee that we will be fully successful in doing so. If we fail to detect or prevent fraudulent or other malicious activity, it may result in dissuading sellers and customers alike from engaging with our products and services. Any actual or alleged future fraudulent activity may damage our reputation, or diminish the value of our brand name, either of which could adversely impact our business, results of operations and financial condition.

~~Several~~Future strategic ~~states~~alliances ~~have~~or ~~enacted~~acquisitions ~~laws~~may ~~requiring~~not ~~businesses subject~~be tosuccessful ~~the~~and ~~laws~~may tohave ~~implement~~a ~~cyber~~material and ~~data~~adverse ~~security~~effect ~~programs.~~on ~~For~~our ~~example~~business, ~~New~~reputation ~~York enacted the Stop Hacks~~ and ~~Improve Electronic~~ ~~Data~~results Security Act (SHIELD Act), effective March 2020, which requires companies with data relating to New Yorkers to adopt comprehensive cybersecurity programs. Since 2010, Massachusetts, through 201 CMR 17.00, has required companies that own or license the personal information of ~~Massachusetts residents to develop, implement, and maintain a Written Information Security Program~~operations.

InWe may ~~recent~~enter ~~years~~into strategic alliances, ~~the~~including ~~U.S.~~joint ~~and~~ventures ~~European~~or ~~lawmakers~~minority equity investments, or acquisitions with various third parties ~~regulators~~to further our business purpose from time to time. An important focus of our business is to identify business relationships that can enhance our services, enable us to develop solutions that differentiate us from our competitors, drive users to our websites, and ~~plaintiffs’~~monetize our ~~attorneys~~data. We have ~~voiced~~entered ~~concern~~into ~~about~~several ~~electronic~~alliance ~~marketing~~agreements ~~and~~or ~~the~~license ~~use~~agreements with respect to certain of ~~third-party~~our ~~cookies~~datasets and ~~similar~~services ~~technology~~and ~~for~~may ~~online~~enter ~~behavioral~~into ~~advertising.~~similar Inagreements in the ~~EU,~~future. ~~marketing~~These isarrangements ~~defined~~may ~~broadly~~require us to ~~include~~restrict ~~any~~our ~~promotional~~use ~~material~~of ~~and~~certain ~~the~~of ~~rules~~our technologies ~~specifically~~or datasets among certain customer industries, restrict content on ~~e-marketing~~our ~~are~~websites, ~~currently~~or ~~set~~grant ~~out~~licenses inon ~~the~~terms ~~ePrivacy~~that ~~Directive~~ultimately may prove to be unfavorable to us, any of which iscould ~~expected~~adversely affect our business, financial condition, or results of operations. These alliances and acquisitions could subject us to bea ~~replaced~~number of risks, including risks associated with sharing proprietary information, non-performance by athe third party and increased expenses in establishing new ~~ePrivacy~~strategic ~~Regulation~~alliances, any of which ~~will~~may ~~impose~~materially ~~strict~~and ~~opt-in~~adversely ~~e-marketing~~affect ~~rules~~our business. Relationships with ~~limited~~our ~~exceptions~~alliance ~~for~~agreement ~~business-to-business~~partners ~~communications~~may be the subject of contractual disputes, and ~~significantly~~if ~~increases~~we or our partners are ~~fining~~not ~~powers~~successful in maintaining or commercializing the alliance agreements’ services, such commercial failure could adversely affect our business. We may have limited ability to monitor or control the ~~same~~actions ~~levels~~of asthese third parties and, to the ~~GDPR.~~extent ~~Regulation~~any of ~~cookies~~these ~~may~~strategic third ~~result~~parties insuffer ~~broader~~negative ~~restrictions~~publicity onor ~~our~~harm ~~online~~to ~~activities~~their reputation from events relating to their business, ~~including~~we may also suffer negative ~~efforts~~publicity or harm to ~~understand~~our ~~followers’~~reputation ~~internet~~by ~~usage~~virtue ~~and~~of ~~promote~~our ~~ourselves~~association towith ~~them~~any such third party.

In addition, ~~Lithuania~~if appropriate opportunities arise, ~~Israel~~we may acquire additional assets, products, technologies or businesses that we believe are complementary to our existing business. Future acquisitions and ~~Norway~~the ~~each~~subsequent integration of new assets and businesses into our own would require significant attention from our management and could result in a diversion of resources from our existing business, which in turn could have ~~unique~~an ~~data~~adverse ~~privacy~~effect ~~regulations~~on ~~that~~our ~~impact~~business ~~how~~operations. Acquired assets or businesses may not generate the financial results we expect and ~~what~~could require the use of substantial amounts of cash, potentially dilutive issuances of equity securities, the occurrence of significant goodwill impairment charges, amortization expenses for other intangible assets and exposure to potential unknown liabilities of the acquired business. Moreover, the costs of identifying and consummating acquisitions may be significant. In addition to possible stockholders’ approval, we ~~can~~may doalso have to obtain approvals and licenses from relevant government authorities for the acquisitions and to comply with ~~employee~~any ~~data~~applicable laws and ~~require~~regulations, ~~local~~which ~~compliance~~could ~~efforts~~result in increased delay and costs.

Efforts to comply with these and other data privacy and security restrictions that may be adopted could require us to modify our data processing practices and policies, increasing the cost of our operations. Failure to comply could subject us to criminal and civil sanctions and other penalties. In part due to the uncertainty of the legal climate, complying with regulations, and any applicable rules or guidance from regulatory authorities or self-regulatory organizations relating to privacy, data protection, information security and consumer protection, may result in substantial costs and may require changes to our business practices, which may limit our growth strategy, adversely impact our ability to attract or retain players, and otherwise negatively affect our business, reputation, legal exposure, financial condition and results of operations.35

~~Any failure or perceived compliance failure with~~LEGAL ~~our~~AND ~~posted~~REGULATORY privacy policies, our privacy-related obligations to users or other third parties, or any other legal obligations or regulatory requirements relating to privacy, data protection, or information security may result in official investigations or enforcement actions, litigation, legal claims, or negative publicity from consumer advocacy groups or the press and could result in significant liability, cause our users to lose trust in us to the point of severing their relationship with us, and otherwise materially and adversely affect our business. Furthermore, the costs of compliance with, and other burdens imposed by, the laws, regulations, and policies that are applicable to us may limit the adoption and use of, and reduce the overall demand for, our products and services. Additionally, service providers or other third parties that we work with, violate applicable laws, regulations, or agreements, such violations may put our users’ and/or employees’ data at risk, could result in formal investigations or enforcement actions, fines, litigation, claims or negative publicity from consumer advocacy groups or the press and could result in significant liability, cause our players to lose trust in us and otherwise materially and adversely affect our reputation and business. Further, public scrutiny of data practices and privacy, or complaints about, such practices, especially when lodged against technology companies, may heighten the chances for an official investigation and result in modifications to existing or the introduction of new regulatory requirements resulting in higher costs and risks. RISKS

~~New laws may impact our business, such as those~~Legal ~~affecting~~or ~~artificial~~regulatory ~~intelligence,~~proceedings ~~and~~or ~~efforts~~allegations byof ~~lawmakers~~impropriety incould ~~various~~have ~~jurisdictions~~a tomaterial ~~regulate~~adverse ~~providers~~impact ofon ~~certain online services which may apply to~~ our ~~business and therefore introduce additional compliance obligations and potential sanctions and penalties for failings in these areas. Monitoring (and~~reputation, ifresults ~~applicable, complying with) these developments is likely to increase the cost~~ of ~~doing business and~~operations, ~~any~~financial ~~failure~~condition ~~to comply with new laws may harm our business~~ and ~~reputation~~liquidity.

~~The legal~~We ~~and~~have ~~regulatory~~been ~~landscape~~party to and ~~industry~~in ~~standards surrounding~~ the ~~use~~future ~~of data and/or artificial intelligence technologies is rapidly evolving and remains uncertain, and compliance~~ may ~~impose~~become ~~significant~~subject ~~operational costs and may limit our ability~~ to ~~develop,~~new ~~deploy~~legal orproceedings ~~use~~in ~~artificial intelligence technologies. New EU laws related to~~ the ~~use~~operation of ~~data~~our business, including, ~~the~~but ~~EU Regulation on a Single Market for Digital Services~~not ~~(2022/2065)~~limited ~~(“DSA”)~~to, ~~the~~with EUrespect ~~Regulation (2023/2854) on fair access~~ to ~~and~~alleged ~~use~~breaches of ~~data~~consumer ~~(“EU~~privacy ~~Data Act”)~~regulations, ~~and~~employee ~~the EU Regulation on Artificial Intelligence (“EU AI Act”)~~matters, ~~may~~alleged ~~impose~~service ~~additional rules~~ and ~~restrictions~~system ~~on the use of the data~~malfunctions, inalleged ~~our~~intellectual ~~products.~~property Ifviolations weand ~~were~~claims ~~required~~relating to ~~change~~ our ~~business activities or revise or eliminate services~~contracts, orlicenses ~~to implement burdensome compliance measures, our business~~ and ~~results~~strategic ~~of operations could be harmed~~investments. ~~We may be subject to fines~~Furthermore, ~~penalties,~~we ~~and potential litigation, including~~may ~~class~~be ~~action~~included in lawsuits, ifas wethird-party ~~fail~~defendants due to ~~comply~~the ~~with~~use ~~applicable~~of ~~privacy~~products ~~and/~~or ~~data~~services ~~security~~of ~~laws,~~the ~~regulations,~~primary ~~standards, and other requirements~~defendant. ~~The~~ ~~costs~~We ~~of compliance with and other burdens imposed by evolving data-related laws, regulations, and standards~~ may ~~limit~~also ~~the~~be ~~use and~~subject ~~adoption~~to offraudulent ~~our~~claims ~~products~~from ~~and~~parties ~~reduce~~like ~~overall~~patent ~~demand~~trolls.

36Additional legal proceedings targeting our products and services and claiming violations of state or federal laws could occur, based on the unique and particular laws of each jurisdiction, particularly as litigation claims and regulations continue to evolve. We cannot predict the outcome of any legal proceedings to which we may be a party, any of which could have a material adverse effect on our results of operations, cash flows or financial condition.

~~Similarly,~~A variety ~~the~~of UKnew ~~has~~and ~~recently~~existing ~~passed~~U.S. ~~the~~and ~~Online Safety~~foreign ~~Act~~government ~~2023~~laws ~~(“OSA”).~~and ~~The~~regulations ~~OSA~~could ~~regulates~~subject ~~“user-~~us to~~-user”~~ ~~services~~claims, ~~e.g.~~judgments, ~~services~~monetary ~~that allow content to be generated~~liabilities ~~by a user~~ and ~~then shared and encountered by~~ other ~~users.~~remedies, ~~The DSA~~ and ~~OSA impose additional obligations on covered service providers and may increase liability for such service providers in relation~~ to ~~content~~limitations ~~hosted and shared~~ on ~~their~~our ~~services. Our~~ business ~~allows users to create accounts and upload content which can then be accessed/encountered by other users. As such~~practices, ~~we will likely incur legal costs~~ in ~~identifying the extent to~~ which ~~obligations~~case ~~under the DSA and OSA may impact~~ our business and ~~there~~results ~~may be ongoing compliance costs associated with these new laws (and any comparable changes in the law in other jurisdictions). Any breaches~~ of ~~these~~operations ~~new laws (to the extent they apply)~~ may ~~also~~be ~~lead to penalties~~ materially and ~~reputational~~adversely ~~damage~~affected.

~~Furthermore, legislators’ and regulators’~~We ~~future~~are ~~approach~~subject to AInumerous ~~may impact our business~~U.S. ~~For~~and ~~example,~~foreign ~~the~~laws ~~publication~~and ofregulations ~~the~~covering ~~White~~a ~~House~~wide ~~Blueprint~~variety ~~for~~of ansubject AImatters. ~~Bill~~New oflaws ~~Rights~~and ~~signals~~regulations, changes ~~that~~in ~~operators~~existing oflaws AIand ~~systems~~regulations inor the ~~U.S.~~interpretation ~~may~~of ~~face~~them, ~~significant~~our ~~compliance~~introduction ~~obligations~~of onnew aproducts, ~~go-forward~~or ~~basis.~~an ~~State~~extension ~~laws~~of ~~relating~~our tobusiness AIinto ~~are~~new ~~also~~areas ~~proliferating,~~could ~~including~~increase ~~significant~~our ~~state~~future AIcompliance ~~laws~~costs, inmake ~~California~~our products and ~~Colorado.~~services ~~Similarly,~~less ~~the~~attractive EUto AIour ~~Act~~users, ~~entered~~introduce ~~into force in~~litigation ~~August~~exposure, ~~2024.~~or ~~The~~cause EUus AIto ~~Act~~change ~~imposes~~or ~~compliance~~limit ~~obligations~~our onbusiness ~~providers~~practices. ~~and~~We ~~users~~may ofincur AIsubstantial ~~systems~~expenses ~~and~~to ~~introduces~~comply ~~regulatory~~with ~~fines~~laws ~~for~~and ~~breaches~~regulations ofor ~~such~~defend ~~obligations.~~against ~~We currently offer~~ a ~~number~~claim ofthat ~~products,~~we ~~services~~have ~~and~~not ~~features~~complied ~~that~~with ~~make~~them. ~~use of AI~~Further, ~~and~~any wefailure ~~are~~on ~~exploring~~our ~~ways~~part ~~in which~~to wecomply ~~can~~with ~~further~~any ~~utilize~~relevant ~~the~~laws ~~technology.~~or ~~The~~regulations may ~~full~~subject ~~extent~~us ~~and~~to ~~applicability~~significant ofcivil ~~potential~~or AIcriminal ~~laws~~liabilities, ~~and~~penalties, ~~regulations~~taxes, ~~will~~fees, ~~require~~costs, ~~monitoring to~~reputational ~~ensure~~harm, wecompetitive ~~remain~~damage ~~in compliance~~ and negative ~~any risks are appropriately mitigated~~publicity.

~~RISKS~~The application ~~RELATED~~of TOexisting ~~CONTENT~~domestic ~~AND~~and ~~INTELLECTUAL~~international ~~PROPERTY~~laws and regulations to us relating to issues such as user privacy and data protection, security, defamation, pricing, advertising, taxation, gambling, sweepstakes, promotions, consumer protection, artificial intelligence and machine learning, accessibility, content regulation, quality of services, law enforcement demands, telecommunications, mobile, and intellectual property ownership and infringement in many instances is unclear or unsettled. Further, the application to us or our subsidiaries of existing laws regulating or requiring licenses for certain businesses of our advertisers can be unclear. U.S. export control laws and regulations also impose requirements and restrictions on exports to certain nations and persons and on our business. Internationally, we may also be subject to laws regulating our activities in foreign countries and to foreign laws and regulations that are inconsistent from country to country. The regulatory landscape for AI is rapidly evolving, with new laws and guidelines emerging globally. Compliance with diverse and potentially conflicting AI regulations across jurisdictions may require significant resources and adjustments to our AI development and deployment practices. Failure to adhere to applicable AI laws could result in legal penalties, restrictions on our operations, and harm to our reputation. Any new legislation, in the U.S. or abroad, may be difficult to comply with in a timely and comprehensive manner and may expose our business to increased costs. If the rules, doctrines or currently available defenses change, if international jurisdictions refuse to apply protections similar to those that are currently available in the U.S. or the EU, or if a court were to disagree with our application of those rules to our solutions, our potential liability for information or content created by third parties and posted to our platform could require us to expend significant resources to try to comply with the new rules and implement additional measures to reduce our exposure to such liability or we could incur liability and our business, financial condition and results of operations could be harmed.

If we face intellectual property infringement claims, or are unable to license, acquire or otherwise obtain access to compelling content and services at reasonable cost, or if we do not develop or commission compelling content of our own, the number of users of the Zedge Marketplace may not grow as anticipated, or may decline, or users’ level of engagement with the Zedge Marketplace may decline, all or any of which could materially harm our business and operating results.36

~~Our~~The Digital ~~future~~Millennium ~~success~~Copyright ~~depends,~~Act in(the ~~part~~“DMCA”) has provisions that limit, onbut do not necessarily eliminate, our ~~ability~~liability tofor ~~aggregate~~caching, ~~and~~hosting, ~~host~~listing ~~compelling~~or ~~content~~linking ~~and~~user-generated ~~deliver~~materials that ~~content~~infringe tocopyrights, ~~our~~so ~~users~~long ~~via~~as ~~our~~we ~~digital~~comply ~~properties.~~with Wethe ~~achieve~~statutory ~~this~~requirements in ~~when~~the ~~users play~~DMCA. ~~our~~The ~~games,~~Communications ~~when~~Decency ~~artists,~~Act ~~individual~~(the ~~creators~~“CDA”) ~~and~~further ~~brands~~helps ~~upload~~to ~~their~~limit ~~licensed~~our potential liability for certain content uploaded toonto our ~~marketplace~~platform by third parties. For example, orSection ~~when~~230 weof ~~create~~the ~~content~~CDA provides immunity from liability for providers of an orinteractive ~~enter~~computer ~~into~~service ~~business~~who ~~partnerships~~publish ~~with~~tortious and otherwise illegal content ~~owners~~provided by users of the service. While the immunity provisions of the DMCA and ~~distribute~~the ~~this~~CDA ~~content~~are inwell ~~our~~established, ~~marketplace~~there are regularly cases seeking to limit the application of such immunity. There Inare ~~addition~~ongoing legal challenges to Section 230 of the CDA, wewhich ~~commission~~could ~~authors~~alter the scope of liability protections. Various U.S. and international laws restrict the distribution of materials considered harmful to ~~write~~children ~~articles~~and ~~for~~impose ~~our~~additional ~~blog~~restrictions on the ability of online services to collect information from minors.

~~We believe that users value high-quality content.~~In ~~As such~~many, webut ~~may~~not ~~need~~all, toterritories ~~make~~outside ~~substantial~~of ~~payments~~the toU.S. ~~third~~there ~~parties~~are ~~from~~laws ~~whom~~similar weto ~~license~~the orDMCA ~~acquire~~that ~~such~~exempt ~~content~~us from orcopyright ~~from~~infringement ~~whom we create~~liability ~~this~~that ~~content~~may ~~for~~arise ~~our~~due ~~behalf. Our ability~~ to ~~maintain~~hosting ~~and build relationships with such third~~user-~~party~~uploaded ~~providers may become important to our success~~materials. AsIn ~~competition~~some ~~for~~countries, ~~compelling~~particularly ~~content~~in ~~increases~~Europe ~~both~~and ~~domestically~~the ~~and~~Asia-Pacific ~~internationally~~region, ~~our~~these ~~partners may alter business terms~~laws ~~under~~are ~~which~~being ~~they~~readjusted ~~avail their content~~ and ~~services~~new, ~~to us~~ and ~~potential~~potentially ~~providers may not offer their content or services to us at all~~burdensome, or ~~may~~constraints ~~offer them on terms that~~ are ~~not~~being ~~agreeable~~imposed toonto ~~us.~~service ~~A change in these commercial terms could harm our operating results and financial condition~~providers. ~~Further, much of the content that we acquire may only be available on a non-exclusive basis allowing competitors the ability of offering this content to our disadvantage.~~

~~We may be subject to intellectual property infringement~~For ~~claims or other allegations~~example, ~~which~~the ~~could~~European ~~require~~Union’s usDirective toon ~~pay~~Copyright ~~substantial~~in ~~statutory~~the ~~penalties~~Digital orSingle ~~other~~Market ~~damages~~(the ~~and~~“DSM ~~fines,~~Directive”) ~~remove~~is ~~relevant content, enter into license agreements which may not be available on commercially reasonable terms or could result~~ in ~~our being barred~~effect ~~from~~and ~~third-party~~has ~~distribution~~been ~~platforms,~~implemented ~~which~~by ~~could~~all ~~harm~~EU ~~our~~Member ~~business and competitive position~~States.

37The DSM Directive Article 17 removes the shield of the current ‘hosting exemption,’ enshrined in the Electronic Commerce Directive (2000/31/EC) (the “E-Commerce Directive”), and replaces it with a principle of full liability where “online content sharing service providers” (“OCSSPs”) are concerned. This means that OCSSPs will be liable for copyright-protected material uploaded by users and must obtain authorization (i.e., a license) from the relevant rightsholders. However, Article 17 effectively creates a new liability exemption regime for OCSSPs (albeit a more onerous one than is currently provided by the E-Commerce Directive) under which OCSSPs will not be liable for the copyright-protected works that they communicate to the public provided that they cooperate with rightsholders by:

~~From~~● ~~time~~making tobest ~~time,~~efforts ~~we are subject~~ to ~~claims~~obtain ~~from owners of technology patents, copyrights, trademarks, trade secrets and content, who assert claims against us. There may also be new laws and regulations that are adopted that change~~ the ~~rules~~necessary ~~related~~authorization ~~to the safe harbor for user generated content and ultimately requiring us to pay licensing fees~~(i. If a claim of infringement is brought against us that we are not able to successfully and cost-effectively defend, we may be required to pay substantial penalties or other damages and fines, remove relevant content, enter into license agreements that may not be available on commercially reasonable terms or at all or be barred from any of the third-party distribution platformse. ~~Even though the allegations or claims could be baseless~~, ~~our~~a ~~defense against any of these allegations or claims would be both costly and time-consuming and could significantly divert the efforts and resources of our management and other personnel.~~license);

We● ~~may~~expeditiously ~~not~~taking bedown ~~able~~or disabling access to ~~prevent~~content ~~others~~upon ~~from unauthorized~~receiving ~~use~~a ofsufficiently ~~our~~substantiated ~~intellectual~~notice ~~property,~~to ~~which~~do ~~could~~so ~~materially~~by ~~harm~~rightsholders ~~our~~(i.e., ~~business~~similar to the existing ‘notice and ~~competitive~~take-down’ ~~position.~~requirements);

We● ~~regard~~making ~~our~~best ~~trademarks,~~efforts ~~service marks, patents, domain names, trade secrets, proprietary technologies and similar intellectual property as critical~~ to ~~our~~prevent ~~success,~~future ~~and~~uploads weof ~~rely~~content onin ~~trademark and~~respect ~~patent law, trade secret protection and confidentiality and license agreements with our employees and others to protect our proprietary right. As~~ of ~~July~~which ~~31,~~they ~~2023, we~~ have ~~registered,~~received amongst others, the following domain names: www.zedge.net, www.zedge.com, www.emojipedia.com, www.emojipedia.org, and gurushots.com. In addition, we have been granted trademark protection for “Zedge” in the United States, European Union, United Kingdom, India, and Canada, “We Make Phones Personal,” “Zedge, Everything You,” “Tattoo Your Phone,” “Shortz – Chat Stories by Zedge,” and “NFTs Made Easy” in the United States, a ~~stylized “D”~~notice ~~logo~~from inrightsholders ~~the~~pursuant ~~European~~to ~~Union,~~ the ~~United~~previous ~~Kingdom,~~requirement and United States, and Canada, “Emojipedia” in the United States, the European Union, the United Kingdom and Australia, “World Emoji Day” in the United States and United Kingdom, and “GuruShots” in the United States(i. ~~We have also applied for trademark protection for “pAInt~~e.,” ~~and “Zedge pAInt” in the United States,~~ a ~~stylized~~‘notice ~~“D” logo in India,~~ and ~~“GuruShots”~~stay indown’ ~~Canada,~~requirement); ~~India, the European Union,~~ and ~~the United Kingdom, and have obtained copyright registrations for the GuruShots mobile and web-based applications, and have obtained a copyright registration for our flagship app, Zedge.~~

~~Monitoring~~● ~~unauthorized~~making ~~use~~best ~~of our intellectual property rights is difficult and costly~~efforts, ~~and~~in weaccordance ~~cannot~~with behigh ~~certain~~industry ~~that~~standards ~~we can effectively prevent misappropriation~~ of ~~our~~professional ~~intellectual property~~diligence, ~~particularly~~to inensure ~~countries where~~ the ~~laws~~unavailability ~~may~~of ~~not~~specific ~~protect~~works ~~our proprietary rights as fully as~~ in ~~the~~respect ~~United~~of ~~States.~~which ~~From~~rightsholders ~~time to time, we may~~ have toprovided ~~resort~~the to‘relevant ~~litigation to enforce our intellectual property rights, which could result in substantial costs~~ and ~~diversion~~ ofnecessary ~~our resources and may not be successful~~information.’

WeThe article ~~may~~also ~~face~~extends ~~challenges~~any inlicenses ~~enforcing~~granted ~~intellectual property~~to ~~rights~~OCSSPs into ~~international~~their ~~markets~~users, as long as those users are not acting “on a commercial basis.”

ItOur increased isuse ~~often~~of ~~difficult~~artificial tointelligence ~~create~~(AI), ~~and~~including ~~enforce~~generative ~~intellectual property~~AI, ~~rights~~ in ~~certain~~our ~~international~~product ~~markets~~offerings presents additional risks. ~~Patents~~For example, uncertain ~~trademarks~~legal and ~~service~~regulatory ~~marks~~treatment ~~may~~around ~~also~~the beprovision ~~invalidated,~~and ~~circumvented~~use of such technologies, orfor ~~challenged. Trade~~example ~~secrets~~in ~~are~~the ~~difficult~~areas toof ~~protect~~privacy and intellectual property, may create increased and ~~our~~uncertain ~~trade~~litigation ~~secrets~~exposure, ~~may~~the bepossibility ~~leaked~~of orregulatory ~~otherwise~~scrutiny, ~~become~~costly ~~known~~compliance requirements and limit or beprohibit ~~independently~~certain ~~discovered by~~of ~~others~~our product offerings. ~~Confidentiality~~Compliance ~~agreements~~with these laws and regulations may be ~~breached,~~onerous and weexpensive, and may ~~not~~be ~~have~~inconsistent ~~adequate~~from ~~remedies~~jurisdiction ~~for~~to ~~any~~jurisdiction, ~~breach.~~further ~~Even~~increasing ~~where~~the ~~adequate~~cost of compliance and ~~relevant~~ ~~laws~~the ~~exist~~risk itof ~~may~~liability. ~~not~~Any besuch increase ~~possible~~in tocosts ~~obtain~~or ~~swift~~increased ~~and~~risk ~~equitable~~of ~~enforcement~~liability as a result of ~~such~~changes in these laws, orand toregulations ~~obtain~~or ~~enforcement~~in oftheir ainterpretation ~~court~~could ~~judgment~~individually or anin ~~arbitration~~the ~~award~~aggregate ~~delivered~~make inour ~~another~~products ~~jurisdiction~~and services that use AI technologies less attractive to our users, cause us to change or limit our business practices or affect our financial condition and ~~accordingly~~operating results. Moreover, weAI may ~~not~~produce becontent ~~able~~seen as infringing upon the rights of others, including with respect to ~~effectively~~copyrights. ~~protect~~Additionally, ~~our~~AI ~~intellectual property~~may ~~rights~~create flawed, biased, harmful, misleading, inaccurate, or ~~enforce~~unexpected ~~agreements~~outputs inand ~~such~~content, ~~countries~~creating risks to our business, partners, and users.

~~Our~~Although we ~~insurance~~have invested and continue to invest in systems and resources, which are intended to help us comply with the requirements of the GDPR, CCPA, DMCA, the DSM Directive and other U.S. and international laws relating to, among other things, materials that infringe on copyrights and contain other objectionable content, our systems may not ~~provide~~be ~~adequate~~sufficient ~~levels~~or we may unintentionally err and fail to comply with these oflaws ~~coverage~~and ~~against~~regulations which could expose us to claims, judgments, monetary liabilities and other remedies, and to limitations on our business practices which could materially adversely affect our business and financial results.

We believe that we maintain insurance customary for businesses of our size and type. However, there are types of losses we may incur that cannot be insured against or that we believe are not economically reasonable or practical to insure. In addition, any loss incurred could exceed policy limits and policy payments made to us may not be made on a timely basis. Such losses could adversely affect our business prospects, results of operations, cash flows and financial condition.37

38Data privacy, security, and emerging AI laws and regulations in the jurisdictions in which we operate subject us to possible sanctions, civil lawsuits (including class action or similar representative lawsuits) and other penalties in the event of non-compliance. The need to observe these evolving requirements increases the cost of doing business and may impose operational burdens that could adversely affect our products, user experience, and competitiveness. Compliance failures by us, our partners, or our vendors could harm our business, reputation, and financial results.

~~RISKS~~Our business ~~RELATED~~relies ~~INFORMATION~~on ~~TECHNOLOGY~~collecting, ~~AND~~processing, ~~DATA~~storing, ~~SECURITY~~using and sharing data, some of which contains personal data, including the personal data of our users. The deployment of AI technologies in our products and services may involve the collection, processing, and storage of personal data, potentially exposing us to heightened privacy and data protection risks. Non-compliance with data protection and privacy regulations could result in significant fines, legal actions, and reputational damage. Moreover, AI systems can inadvertently process sensitive information, leading to unauthorized processing, disclosures or misuse of personal data. As regulatory frameworks evolve, we may incur increased costs to ensure compliance and adapt our AI systems accordingly. We also incorporate AI into specific products and internal workflows, including generative AI features in our Zedge App and AI-driven content capabilities in other offerings. As a result, we are subject to a growing number of federal, state, local, and foreign laws, regulations, regulatory codes, and guidelines governing privacy, data protection, AI, and information security. These regimes—covering the collection, storage, use, processing, transmission, sharing, and protection of personal information, as well as the training and deployment of AI systems—may be inconsistent across jurisdictions, conflict with one another, and change frequently.

~~Our~~The EU ~~business~~General ~~depends~~Data onProtection ~~our~~Regulation ~~ability~~(“GDPR”) toand ~~collect~~the UK GDPR impose stringent privacy requirements, increase compliance costs, and ~~effectively~~authorize ~~use~~substantial ~~data~~fines for non-compliance. Changes to ~~serve~~data ~~relevant~~protection ~~advertising,~~laws ~~deliver~~in ~~suitable~~the ~~content~~UK, ~~and~~introduced ~~identify~~by ~~appropriate~~the ~~customer~~Data ~~prospects,~~(Use and ~~any~~ ~~limitation~~Access) onAct ~~the~~2025, ~~collection~~introduce ~~and~~an ~~use~~additional compliance burden represented by divergence of ~~this~~UK ~~data~~privacy ~~could~~standards ~~significantly~~previously ~~diminish~~aligned to those in the ~~value~~EU, following the UK’s exit from the EU on December 31, 2020. Several countries have enacted or are considering laws mandating local storage and processing of ~~our~~data ~~services~~or restricting cross-border data flows, ~~cause~~potentially requiring us to ~~lose~~modify ~~clients,~~systems ~~make~~architecture usor ~~less~~withdraw ~~attractive~~certain toservices ~~prospective~~from ~~customers~~affected ~~and revenues~~jurisdictions.

~~When~~In the ~~one~~United ~~uses~~States, ~~our~~the ~~products~~California ~~and~~Consumer ~~services,~~Privacy weAct ~~may collect~~(“CCPA”), ~~both~~as ~~personally~~amended ~~identifiable~~by ~~and~~the ~~non-personally~~California ~~identifiable~~Privacy ~~data~~Rights ~~about~~Act ~~the~~(“CPRA”), and ~~user.~~many ~~This~~similar ~~may~~or ~~include~~forthcoming ~~but~~state isprivacy ~~not~~laws ~~limited~~impose torestrictions on the ~~user’s~~ ~~name,~~collection ~~telephone~~and ~~number,~~use ~~email~~of ~~address,~~personal ~~web cookies~~information, ~~Meta~~sometimes ~~and~~with heightened ~~other~~protections ~~login~~for ~~credentials~~minors, ~~phone~~provide ~~model,~~various ~~operating~~rights ~~system,~~to ~~location~~consumers, ~~Android~~ ~~Advertising~~and IDmay ~~(“AAID”),~~provide ~~Apple’s~~private ~~Identifier~~rights ~~for~~of ~~Advertising,~~action ~~IDFA,~~for ascertain ~~well~~data asbreaches. All ~~information~~50 ~~relating~~U.S. tostates, ~~their interaction~~the ~~with~~District ~~advertisements~~of Columbia, and ~~content~~U.S. ~~appearing~~territories ~~within~~have ~~our~~enacted ~~products.~~breach-notification ~~Often~~laws, weand ~~use~~several ~~some~~require implementation of ~~this~~comprehensive ~~data~~cybersecurity toprograms. ~~provide~~Compliance awith ~~better~~these ~~experience for~~requirements ~~the~~increases ~~user~~operational bycosts ~~delivering~~and ~~both~~the ~~relevant~~risk ~~content~~of ~~and advertisements~~liability. In addition, wethere ~~use~~has ~~some~~been ofa ~~this~~significant ~~data~~increase toin ~~help~~putative usclass ~~target~~action ~~prospective~~activity under privacy and privacy-related laws, often with ~~customers~~claims asfor ~~well~~statutory asdamages and demands for ~~advertising~~changes ~~reporting~~in ~~purposes~~business operations.

~~Additionally, internet enabled devices and operating~~In ~~systems~~recent ~~are~~years, ~~controlled by third parties and in most cases offer options that allow users to disable functionality that allows for~~ the ~~delivery~~ ~~of advertising on their devices~~U.S. ~~Device~~ and ~~browser~~European ~~manufacturers may include or expand these features as part of their standard device specifications. For example~~lawmakers, ~~Apple deprecated UDID~~regulators, aand ~~standard~~plaintiffs’ ~~device~~attorneys ~~identifier,~~have ~~ultimately~~voiced ~~replacing~~concern itabout ~~with~~electronic ~~IDFA, which makes~~marketing and the ~~process~~use ~~for~~of ~~iPhone~~third-party ~~users~~cookies toand ~~opt~~similar ~~out~~technology offor online behavioral ~~targeting easier~~advertising. IfRegulation ~~players elect to opt-out~~ of ~~sharing~~cookies ~~data~~may ~~about~~result ~~themselves~~in broader werestrictions ~~will~~on beour ~~curtailed~~online inactivities, ~~our~~including ~~ability~~efforts to ~~deliver~~understand ~~effective~~followers’ ~~which~~internet ~~could~~usage ~~negatively~~and ~~affect~~promote ~~our~~ourselves ~~digital~~to ~~advertising revenues~~them.

~~Although~~In parallel, ~~our~~legislators ~~Privacy~~and ~~Policy~~regulators globally are moving quickly to address AI-specific risks and ~~Terms~~operators of ~~Service~~AI systems may face significant ~~provide~~compliance ~~extensive~~obligations. ~~details~~California ~~about~~and ~~how~~Colorado wehave ~~use~~enacted ~~customer~~AI ~~data~~laws ~~our~~imposing ~~clients~~transparency, ~~may~~risk-management, ~~decide~~and ~~not~~accountability torequirements, and ~~allow~~other usstates toare ~~collect~~considering ~~some~~similar ormeasures. ~~all~~For example, Colorado’s SB 24-205, effective in 2026, will require deployers and developers of ~~this~~high-risk ~~data~~AI orsystems to implement risk management policies, conduct impact assessments, and provide transparency disclosures. ~~may~~Additional ~~limit~~state ~~how~~and wefederal ~~can~~legislative ~~use~~activity ~~this~~may ~~data~~result in further binding obligations. ~~Any~~In ~~limitation~~addition, the EU Regulation on ~~our~~Artificial Intelligence ~~ability~~(“EU toAI ~~collect~~Act”) ~~data~~entered ~~about~~into ~~user~~force ~~behavior~~in August 2024, with phased applicability beginning in 2025, imposing obligations on providers and ~~app~~users ~~interactions~~of ~~would~~AI ~~likely~~systems, including risk classification, data-governance, documentation, transparency, and human-oversight ~~make~~requirements, itbacked ~~more~~by ~~difficult~~significant fines for usnon-compliance. In addition to ~~deliver~~these ~~germane~~EU-wide ~~content~~requirements, EU Member States are beginning to ~~our~~introduce ~~users~~their ~~and~~own ~~effective~~individual ~~mobile~~AI ~~advertising~~laws, ~~campaigns~~which ~~that~~have ~~meet~~the potential to go beyond those requirements of the ~~demands~~EU AI Act. The UK, Canada, ofand ~~our~~Australia ~~advertisers~~are developing their own AI-specific legal frameworks. Complying with overlapping and potentially inconsistent regimes may require us to modify algorithms, retrain models, restrict features, alter data-handling practices, or delay or forego product launches.

Our contracts with advertisers generally permit us to aggregate data from advertising campaigns, yet these clients might nonetheless request that we discontinue using data obtained from their campaigns that have already been aggregated with other clients’ campaign data. It would be difficult, if not impossible, to comply with these requests, and these kinds of requests could also cause us to invest significant amounts of resources. Interruptions, failures or defects in our data collection, mining, analysis and storage systems, as well as privacy concerns and regulatory restrictions regarding the collection of data, could also limit our ability to aggregate and analyze mobile device user data from our clients’ advertising campaigns. If that happens, we may not be able to optimize the placement of advertising for the benefit of our advertiser clients, which could make our services less valuable, and, as a result, we may lose clients and our revenues may materially decline.38

~~Any~~In addition, ~~significant~~as ~~system~~major orplatforms ~~network~~and ~~disruption~~competitors integrate their own AI features, such as Google’s AI Overviews in search, AI-driven emoji rendering, or ~~cyberattack~~direct ~~could~~delivery ~~have~~of awallpaper ~~material~~and ~~adverse~~personalization ~~effect~~content, ontraffic to our ~~business~~properties, ~~prospects~~including Emojipedia and ~~results~~the Zedge ofMarketplace, ~~operations~~could decline, which could adversely impact user acquisition, engagement, and monetization. AI outputs may also inadvertently infringe third-party intellectual property, produce flawed, biased, misleading, or harmful content, or fail to meet user expectations, exposing us to legal claims, regulatory scrutiny, and reputational harm.

WeEfforts to ~~rely~~comply ~~heavily~~with onthis complex ~~information~~and ~~technology~~evolving legal landscape may require substantial modifications to our data-processing practices, AI governance, ~~systems~~and product features, increasing operational costs and ~~networks~~reducing speed to ~~operate~~market. ~~our~~Failure ~~business~~to ~~efficiently.~~comply—or ~~Any~~perceived ~~significant~~failure ~~disruption~~to comply—with applicable privacy, security, or ~~cyberattack~~AI-related ~~affecting~~obligations ~~these~~may ~~systems~~result ~~could~~in ~~have a~~investigations, ~~detrimental~~enforcement ~~impact~~actions, onlitigation, ~~our~~fines, ~~operations~~negative publicity, ~~and~~loss ~~financial~~of ~~performance.~~user ~~Our~~trust, ~~technological~~and ~~infrastructure~~other ~~includes~~harm ~~both~~to ~~internal~~our ~~systems~~business, financial condition, and results of operations. Moreover, compliance failures ~~services~~or ~~managed~~breaches by ~~third-party~~our service providers. ~~This~~or ~~reliance~~other ~~has~~third ~~become~~parties ~~increasingly~~with ~~complicated~~whom ~~due~~we toshare ~~ongoing~~data ~~supply~~may ~~chain~~subject ~~disruptions exacerbated~~us byto ~~geopolitical~~liability ~~events,~~and ~~such~~reputational asdamage even ~~conflicts~~if ~~that~~we ~~may~~are ~~further~~not ~~complicate~~directly ~~existing~~at ~~supply chain constraints~~fault.

~~All~~New laws ~~information~~may ~~technology~~impact ~~systems~~our ~~and~~business, ~~networks face~~such ~~potential~~as ~~vulnerabilities~~those ~~from~~affecting ~~various~~artificial ~~sources~~intelligence, ~~including~~online ~~cyberattacks~~platforms, ~~computer~~and ~~viruses,~~digital ~~malicious~~content ~~software~~providers, ~~energy~~and ~~blackouts,~~efforts ~~natural~~by ~~disasters,~~lawmakers in various jurisdictions to regulate providers of certain online services which may apply to our business and ~~telecommunication~~therefore introduce ~~failures.~~additional Wecompliance ~~securely~~obligations ~~store~~and ~~sensitive~~potential ~~data,~~sanctions and ~~any~~penalties ~~breach—whether~~for ~~physical~~failings orin ~~electronic—of~~these areas. Monitoring (and, if applicable, complying with) these developments is likely to increase the ~~systems~~cost ~~housing~~of ~~this~~doing ~~information~~business, ~~could~~and ~~lead~~any failure to ~~significant~~comply ~~risks,~~with ~~including~~new ~~data~~laws ~~piracy~~may orharm our ~~compromise~~business and reputation.

~~Additionally~~The legal and regulatory landscape and industry standards surrounding the use of data and/or artificial intelligence technologies is rapidly evolving and remains uncertain, ~~third-party~~and ~~partners~~compliance may beimpose ~~granted access~~significant tooperational costs and may limit our ~~proprietary~~ability ~~information~~to develop, deploy, or use artificial intelligence technologies. New EU laws related to ~~provide~~the ~~necessary~~use ~~services~~of data, ~~which~~including ~~involves~~the EU Regulation on a ~~risk~~Single ofMarket ~~data~~for Digital ~~misappropriation~~Services or(2022/2065) ~~unauthorized~~(“DSA”), the EU Regulation (2023/2854) on fair access to and use~~. A~~ of data ~~intrusion~~(“EU Data Act”), and the EU AI Act, which entered into force in August 2024, may impose additional rules and restrictions on the ~~servers~~use ~~hosting~~of ~~our~~the data in our products. ~~could~~If ~~disrupt~~we ~~operations~~were required to change our business activities or revise or eliminate services, ~~particularly~~or ~~for~~to ~~those~~implement ~~offering~~burdensome ~~online~~compliance measures, ~~features~~our business and results of operations could be harmed. ~~The~~We may be subject to fines, penalties, and potential litigation, including ~~risks~~class ~~associated~~action lawsuits, if we fail to comply with ~~such~~applicable ~~breaches~~privacy, ~~may~~data besecurity, ~~heightened~~or AI-specific laws, regulations, standards, and other requirements. The costs of compliance with, and other burdens imposed by, ~~global~~evolving ~~events~~data-related and AI-related laws, ~~further~~regulations, and ~~complicating~~standards may limit the use and adoption of our ~~cybersecurity~~products ~~posture~~and reduce overall demand.

39Similarly, the UK has implemented the Online Safety Act 2023 (“OSA”), which regulates “user-to-user” services and imposes additional obligations on covered service providers, potentially increasing liability in relation to content hosted and shared on their services. Our business allows users to create accounts and upload content that can be accessed or encountered by other users. As such, we will likely incur legal costs in identifying the extent to which obligations under the DSA, OSA, and comparable laws in other jurisdictions may impact our business, and there may be ongoing compliance costs associated with these laws. Any breaches of such laws (to the extent they apply) may also lead to penalties and reputational damage.

~~Disruption~~Furthermore, legislators’ and regulators’ future approach to AI may impact our ~~information~~business. ~~technology~~In ~~systems~~the United States, state-level AI laws continue ~~network~~to ~~failures~~proliferate, orwith ~~security~~notable ~~breaches~~developments ~~could~~in ~~negatively~~California ~~impact~~and ~~our~~Colorado, ~~business~~and ~~continuity~~additional states actively considering similar legislation. In the EU, ~~operations~~the AI Act introduces tiered compliance requirements, ~~and~~bans ~~financial~~certain ~~results.~~“unacceptable-risk” ~~These~~systems, ~~risks~~and mandates transparency ~~are~~and ~~not~~risk-management ~~confined~~obligations tofor ~~our~~“high-risk” ~~internal~~AI systems;. ~~they~~Other ~~also~~jurisdictions, ~~extend~~including toCanada (through the ~~networks~~proposed Artificial Intelligence and eData Act), Brazil, and several Asia-~~commerce~~Pacific ~~platforms~~markets, ofare ~~console~~advancing ~~providers~~their ~~and~~own ~~online~~AI ~~partners~~regulatory frameworks. We currently ~~External~~offer ~~factors~~a number of products, ~~such~~services, asand ~~extended~~features ~~remote~~that ~~work~~make ~~arrangements,~~use ~~geopolitical~~of ~~tensions~~AI, and ~~internal~~we ~~factors~~are ~~like~~exploring ~~data~~ways ~~migration~~to further utilize the technology. The full extent and ~~system~~applicability of potential AI laws and regulations will require continuous monitoring to help ensure we remain in ~~maintenance,~~compliance ~~further~~and ~~exacerbate~~any ~~these~~associated risks are appropriately mitigated.

Our systems and those of our third-party service providers may not always be fully adequate against all vulnerabilities. We lack redundancy for every system, and our disaster recovery planning may not account for all contingencies. As our digital business continues to expand, we will require increasingly robust internal and external technological infrastructure to meet player demands. Failure to adapt and effectively scale this infrastructure may compromise the performance and reliability of our products and negatively impact our business.39

~~The~~Finally, emerging ~~investment~~policy ~~needed~~trends—including toinitiatives ~~eliminate~~by ormajor ~~address security~~search ~~threats~~ and ~~vulnerabilities~~platform ~~before~~operators orto ~~after~~integrate ~~a cyber~~AI-~~incident~~generated ~~could~~content beand ~~material.~~features directly ~~Our~~into ~~remediation~~their ~~efforts~~core ~~may not be successful and~~ services—could ~~result~~lead into ~~interruptions,~~regulatory ~~delays~~changes orimpacting ~~cessation~~discoverability of ~~service,~~our products and ~~loss of existing or potential suppliers~~services, ~~users, or creators. As~~use ~~threats~~of ~~related~~our tocontent ~~cyber-attacks~~in ~~continuously~~training ~~evolve~~AI ~~and grow~~models, weand ~~may~~our ~~also~~ability ~~find it necessary~~ to ~~invest~~monetize ~~additional~~user-generated ~~resources~~or inAI-generated ~~protecting our data and infrastructure, which may impact our results of operations~~content. ~~Although~~These ~~we have insurance coverage protection against cyber-attacks~~developments, whether itarising ~~may not be sufficient to cover all possible claims stemming~~ from ~~security~~statutory ~~breaches~~changes, ~~cyberattacks~~administrative ~~and other types of unlawful activity~~rule-making, or ~~any~~industry-imposed ~~resulting disruptions from such events~~standards, ~~and we may suffer losses that~~ could ~~have~~materially aand ~~material~~adversely ~~adverse~~affect ~~effect on~~ our ~~business. We~~ ~~could also be negatively impacted by existing and proposed laws and regulations in the United States~~operations, ~~Lithuania,~~competitive ~~Israel~~position, ~~Norway the European Union,~~ and ~~other~~results ~~jurisdictions,~~of ~~as well as government policies and practices related to cybersecurity, data privacy, data localization and data protection~~operations.

~~Furthermore, the exploitation of our systems~~RISKS ~~can~~RELATED ~~adversely~~TO ~~affect~~CONTENT ~~our~~AND ~~products~~INTELLECTUAL and services. The virtual economies within many of our digital offerings are particularly susceptible to abuse and fraudulent activities. Despite implementing ongoing measures to prevent such issues, activities like the illicit generation and sale of accounts or virtual items can result in loss of revenue, interfere with player enjoyment, and cause reputational harm.PROPERTY

InIf we ~~addition,~~face ~~the~~intellectual ~~platforms~~property ~~that~~infringement weclaims, ~~use~~or toare ~~distribute our~~unable ~~apps~~to ~~may encourage~~license, acquire or ~~require,~~otherwise ~~compliance~~obtain ~~with~~access ~~certain~~to ~~security~~compelling ~~standards~~content and services at reasonable cost, ~~such~~or asif ~~the~~we ~~voluntary~~do ~~cybersecurity~~not ~~framework~~develop ~~released by~~or ~~the~~commission ~~National~~compelling ~~Institute~~content of ~~Standards~~our ~~and~~own, ~~Technology~~the ~~which~~number ~~consists~~of users of ~~controls~~the ~~designed~~Zedge Marketplace tomay ~~identify~~not ~~and~~grow ~~manage~~as ~~cyber-security~~anticipated, ~~risks~~or may decline, ~~and~~ weor ~~could~~users’ belevel ~~negatively~~of ~~impacted~~engagement towith the ~~extent~~Zedge weMarketplace ~~are~~may ~~unable~~decline, all toor ~~comply~~any ~~with~~of ~~such~~which ~~standards~~could materially harm our business and operating results.

~~RISKS~~Our future ~~RELATED~~success TOdepends, ~~OUR~~in ~~OWNERSHIP~~part, ~~AND~~on ~~OUR~~our ~~CLASS~~ability Bto ~~COMMON~~develop ~~STOCK~~or aggregate and host compelling content and deliver that content to our users via our digital properties. We achieve this when users play our game, when artists, individual creators and brands upload their licensed content to our marketplace, or when we create content or enter into business partnerships with content owners and distribute this content in our marketplaces. In addition, we commission authors to write articles for our blog and use other tools and third parties to generate content.

We believe ~~have~~that ~~granted~~users value high-quality content. As such, ~~and~~we may ~~continue~~need to ~~grant,~~make substantial payments to third parties from whom we license ~~options,~~or ~~restricted~~acquire ~~shares~~such content from or from whom we create this content for our behalf. Our ability to maintain and ~~other~~build ~~types~~relationships ofwith such ~~awards~~third-party ~~under~~providers may become important to our ~~stock~~success. ~~option~~As competition for compelling content increases both domestically and internationally, ~~equity~~our ~~incentive~~partners ~~plans~~may alter business terms under which they avail their content and ~~otherwise~~services to us and potential providers may not offer their content or services to us at all, ~~which~~or may ~~result~~ offer them on terms that are not agreeable to us. A change in ~~increased~~these ~~equity~~commercial terms could harm our operating results and financial condition. Further, much of the content that we acquire may only be available on a non-~~based~~exclusive ~~compensation~~basis ~~expenses~~allowing competitors the ability of offering this content to our disadvantage.

~~The expenses associated with equity-based compensation,~~We ~~including~~may ~~the~~be ~~potential~~subject ~~repricing~~to ofintellectual ~~options,~~property ~~have~~infringement ~~affected~~claims ~~our~~or ~~net~~other ~~income and may reduce our net income in the future~~allegations, ~~and~~which ~~any~~could ~~additional equity~~require ~~issued~~us ~~under~~to ~~equity-based~~pay ~~compensation~~substantial ~~schemes will dilute the ownership interests of our stockholders. We believe the granting~~statutory ofpenalties ~~equity-based~~or ~~compensation~~other isdamages ~~of significant importance to our ability to attract~~ and ~~retain~~fines, ~~key~~remove ~~personnel~~relevant ~~and employees~~content, ~~consultants and~~enter ~~directors,~~into ~~and~~license weagreements ~~will~~which ~~continue~~may tonot ~~grant~~be ~~equity-based~~available ~~compensation~~on incommercially reasonable ~~the~~terms ~~future.~~or Ascould a result, in our ~~expenses~~being ~~associated~~barred ~~with~~from ~~equity~~third-~~based compensation~~party ~~may~~distribution ~~increase~~platforms, which ~~may~~could ~~have~~harm ~~an adverse effect on~~ our ~~results~~business ~~of operations~~ and ~~would dilute the ownership interests of~~competitive ~~our stockholders~~position.

~~Investors~~From time to time, we are subject to claims from owners of technology patents, copyrights, trademarks, trade secrets and content, who assert claims against us. There may ~~suffer~~also ~~dilution~~be new laws and regulations that are adopted that change the rules related to the safe harbor for user generated content and ultimately requiring us to pay licensing fees. The use of AI-generated content raises complex intellectual property (IP) considerations, including questions about ownership rights and potential infringement of third-party IP. Uncertainties in IP law regarding AI outputs may expose us to legal disputes and challenges in protecting our proprietary content. We may need to invest in legal expertise and adjust our content policies to navigate these complexities effectively, increasing costs and potential liability. If a claim of infringement is brought against us that we are not able to successfully and cost-effectively defend, we may be required to pay substantial penalties or other damages and fines, remove relevant content, enter into license agreements that may not be available on commercially reasonable terms or at all or be barred from any of the third-party distribution platforms. Even though the allegations or claims could be baseless, our defense against any of these allegations or claims would be both costly and time-consuming and could significantly divert the efforts and resources of our management and other personnel.

We may engage in equity financing to fund our future operations and growth or acquisitions. If we raise additional funds and/or provide consideration in acquisitions by issuing equity securities, stockholders may experience significant dilution of their ownership interest (both with respect to the percentage of total securities held, and with respect to the book value of their securities) and such securities may have rights senior to those of the holders of our Class B common stock.40

~~Any~~We may ~~such~~not ~~equity~~be ~~financing~~able ~~could~~to ~~occur~~prevent atothers ~~prices below,~~from orunauthorized ~~well~~use ~~below, the then-current trading price~~ of our ~~Class~~intellectual ~~B common stock~~property, which ~~would~~could ~~further~~materially ~~exacerbate~~harm ~~the~~our ~~ownership~~business ~~interests of~~and ~~our stockholders~~competitive position.

40We regard our trademarks, service marks, patents, domain names, trade secrets, proprietary technologies and similar intellectual property as critical to our success, and we rely on trademark and patent law, trade secret protection and confidentiality and license agreements with our employees and others to protect our proprietary right. As of July 31, 2023, we have registered, amongst others, the following domain names: www.zedge.net, www.zedge.com, www.emojipedia.com, www.emojipedia.org, and gurushots.com. In addition, we have been granted trademark protection for “Zedge” in the United States, European Union, United Kingdom, India, and Canada, “We Make Phones Personal,” “Zedge, Everything You,” “Tattoo Your Phone,” “Shortz – Chat Stories by Zedge,” and “NFTs Made Easy” in the United States, a stylized “D” logo in the European Union, United Kingdom, United States, and Canada, “Emojipedia” in the United States, the European Union, the United Kingdom and Australia, “World Emoji Day” in the United States and United Kingdom, and “GuruShots” in the United States, Canada, European Union, and the United Kingdom. We have also applied for trademark protection for “pAInt,” and “Zedge pAInt” in the United States, a stylized “D” logo in India, and “GuruShots” in India, and have obtained copyright registrations for the GuruShots mobile and web-based applications, and have obtained a copyright registration for our flagship app, Zedge.

~~Our~~Monitoring unauthorized ~~business,~~use ~~financial~~of ~~condition~~our intellectual property rights is difficult and ~~results~~costly, and we cannot be certain that we can effectively prevent misappropriation of ~~operations~~our intellectual property, asparticularly ~~well~~in ascountries where the laws may not protect our ~~ability~~proprietary torights ~~obtain~~as ~~additional~~fully as ~~financing~~in the United States. From time to time, we may behave ~~adversely~~to ~~affected~~resort byto ~~downturn~~litigation to enforce our intellectual property rights, which could result in ~~the~~substantial ~~global~~costs ~~economy~~and diversion of our resources and may not be successful.

~~The global financial markets have experienced~~We ~~significant~~may ~~disruptions~~face ~~over~~challenges the past fifteen years and the recoveries from the lows of 2008 and 2009 as well as from the Covid 19 pandemic have been uneven. There is considerable uncertainty over the long-term effects of the expansionary monetary and fiscal policies adopted by the central banks and financial authorities of some of the world’s leading economies. There have also been concerns over unrest in ~~Eastern~~enforcing ~~Europe,~~intellectual ~~the~~property ~~Middle~~rights ~~East and Africa, which have resulted~~ in ~~volatility~~international ~~in the energy and food sectors amongst other~~ markets. We may be affected by economic downturns. A prolonged slowdown in the world economy may lead to a reduced amount of mobile internet advertising, which could materially and adversely affect our business, financial condition and results of operations.

~~Moreover,~~It is aoften ~~slowdown~~difficult orto ~~disruption~~create and enforce intellectual property rights in ~~the~~certain ~~global~~international markets. Patents, trademarks and service ~~economy~~marks may ~~have~~also abe ~~material~~invalidated, ~~and~~circumvented, ~~adverse~~or ~~impact~~challenged. onTrade ~~financings~~secrets ~~available~~are difficult to ~~us.~~protect, ~~The~~and ~~weakness~~our intrade ~~the~~secrets ~~economy~~may ~~could~~be ~~erode~~leaked or ~~investor~~otherwise ~~confidence, which~~become ~~constitutes~~known ~~the~~or ~~basis~~be ofindependently ~~the~~discovered ~~credit~~by ~~market~~others. ~~Turmoil~~Confidentiality ~~affecting~~agreements ~~the~~may ~~financial~~be ~~markets~~breached, and ~~banking~~we ~~system~~may not have adequate remedies for any breach. Even where adequate and relevant laws exist it may ~~significantly~~not ~~restrict~~be possible to obtain swift and equitable enforcement ~~our~~of ~~ability~~such laws, or to obtain ~~financing~~enforcement inof ~~the~~a ~~capital~~court ~~markets~~judgment or ~~from~~an ~~financial~~arbitration ~~institutions~~award ondelivered ~~commercially~~in ~~reasonable~~another ~~terms~~jurisdiction, and accordingly, we may not be able to effectively protect our intellectual property rights or atenforce ~~all~~agreements in such countries.

~~The trading price of the shares of our Class~~Our Binsurance ~~common stock~~ may benot ~~volatile,~~provide ~~and~~adequate ~~purchasers~~levels of ~~our~~coverage ~~Class~~against ~~B common stock could incur substantial losses~~claims.

~~Our~~We believe ~~stock~~that ~~price~~we ~~could~~maintain beinsurance ~~volatile.~~customary ~~The~~for ~~stock market~~businesses inof ~~general~~our size and ~~the~~type. ~~market~~However, ~~for~~there ~~mobile~~are ~~internet~~types ~~companies~~of inlosses ~~particular~~we ~~have~~may ~~experienced~~incur ~~extreme volatility~~ that cannot ~~has~~be ~~often~~insured ~~been unrelated~~against toor ~~the~~that ~~operating~~we ~~performance~~believe ofare ~~particular~~not ~~companies.~~economically Asreasonable aor ~~result~~practical ofto ~~this~~insure. ~~volatility~~In addition, ~~investors~~any ~~may~~loss ~~not~~incurred becould exceed ~~able~~policy tolimits ~~sell~~and ~~their Class~~policy Bpayments ~~common~~made ~~stock~~to atus ormay ~~above~~not ~~the~~be ~~price~~made ~~paid~~on ~~for~~a ~~the~~timely ~~shares~~basis. ~~The~~Such ~~market~~losses ~~price~~could ~~for~~adversely affect our ~~Class~~business prospects, Bresults ~~common~~of ~~stock~~operations, ~~may~~cash beflows ~~influenced~~and byfinancial ~~many factors, including:~~condition.

●RISKS RELATED ~~actual~~INFORMATION orTECHNOLOGY ~~anticipated~~AND ~~variations~~DATA ~~in quarterly operating results;~~SECURITY

●Our business ~~changes~~depends inon ~~financial~~our ~~estimates~~ability byto uscollect orand byeffectively use data to serve relevant advertising, deliver suitable content, and identify appropriate customer prospects, and any ~~securities~~limitation ~~analysts~~on ~~who~~the ~~might~~collection ~~cover~~and use of this data could significantly diminish the value of our services, ~~stock;~~cause us to lose clients, make us less attractive to prospective customers, and harm our revenues.

●When one ~~conditions~~uses orour ~~trends~~products inand services, we may collect both personally identifiable and non-personally identifiable data about the user. This may include, but is not limited to, the user’s name, telephone number, email address, web cookies, Meta and other login credentials, phone model, operating system, location, Android Advertising ID (“AAID”), Apple’s Identifier for Advertising (“IDFA”), as well as information relating to their interaction with advertisements and content appearing within our ~~industry;~~products. We use certain of this data to provide a better experience for the user by delivering both relevant content and advertisements. We also use some of this data to help us target prospective customers and for advertising reporting purposes.

~~● stock market price and volume fluctuations of other publicly traded companies and, in particular, those that operate in the advertising, internet or media industries;~~41

●Additionally, internet-enabled ~~announcements~~devices, browsers, and operating systems, controlled by usthird parties, offer options that allow users to disable or limit ~~our~~functionality ~~competitors~~that ofsupports ~~new~~advertising ~~product~~and analytics. Device and browser manufacturers may include or ~~service~~expand ~~offerings~~these features as part of their standard specifications. For example, ~~significant~~Apple ~~acquisitions;~~deprecated UDID, replacing it with IDFA, and later required opt-in consent for IDFA tracking, while Google is developing the Privacy Sandbox for Android, limiting cross-app tracking. If users elect to opt out of data sharing, we will be curtailed in our ability to deliver effective advertising, which could negatively affect our digital advertising revenues.

●The regulatory ~~strategic~~landscape ~~partnerships~~for online tracking continues to evolve, particularly in relation to the use of cookies and similar technologies. In the EU, UK, and certain other jurisdictions, businesses are required to obtain informed user consent before placing non-essential cookies or ~~divestitures;~~engaging in behavioral advertising. To facilitate compliance, many publishers, including us, employ consent management platforms (“CMPs”) that present cookie banners or preference centers, record user choices, and transmit consent signals to advertising partners. However, CMP implementation increases operational complexity, may cause user friction, and can materially reduce the percentage of users granting consent for personalized advertising. Industry data indicates that consent rates can vary widely (often below 70% in some markets), and further regulatory changes or browser-level restrictions on CMP frameworks (such as Google Chrome’s planned third-party cookie phase-out) could depress those rates further. A sustained drop in consent rates would directly impact the volume and value of addressable advertising inventory.

●Although our ~~announcements~~Privacy Policy and Terms of ~~investigations~~Service provide extensive details about how we use customer data, our clients or ~~regulatory~~advertising ~~scrutiny~~partners may decide not to allow us to collect some or all of this data or may limit how we can use it. Any limitation on our ~~operations~~ability to collect behavioral, engagement, or ~~lawsuits~~device ~~filed~~data ~~against~~would likely make it more difficult for us; to deliver relevant content to our users and effective advertising campaigns that meet advertiser demands.

●Our contracts ~~changes~~with advertisers generally permit us to ~~regulations~~aggregate ~~including~~data ~~but~~from ~~not~~campaigns; ~~limited~~however, clients might nonetheless request that we discontinue using previously aggregated data. Complying with such requests may be difficult or impossible and could require us to invest significant resources. Interruptions, failures, or defects in our data collection, analysis, and storage systems, combined with privacy concerns, consent-management restrictions, and ~~copyrighted~~regulatory ~~content;~~changes, could limit our ability to aggregate and analyze mobile device user data. If that happens, we may be unable to optimize ad placement for our clients, making our services less valuable and potentially resulting in client losses and materially reduced revenues.

●Any significant ~~capital~~system ~~commitments;~~or network disruption or cyberattack could have a material adverse effect on our business prospects and results of operations.

●We rely ~~additions~~heavily on complex information technology systems and networks to operate our business efficiently. Any significant disruption or cyberattack ~~departures~~affecting ofthese ~~key~~systems ~~personnel;~~could have a detrimental impact on our operations and financial performance. Our technological infrastructure includes systems and services managed by third-party providers. This reliance has become increasingly complicated due to ongoing supply chain disruptions exacerbated by geopolitical events, such as conflicts that may further complicate existing supply chain constraints.

●All information ~~sales~~technology ofsystems ~~our~~and ~~Class~~networks Bface ~~common~~potential ~~stock~~vulnerabilities ~~common~~from ~~stock~~various sources, including ~~sales~~cyberattacks, bycomputer viruses, malicious software, energy blackouts, natural disasters, and telecommunication failures. AI systems can introduce new cybersecurity vulnerabilities, including susceptibility to adversarial attacks, model inversion, and data poisoning. Exploitation of these vulnerabilities could lead to unauthorized access to sensitive information, disruption of services, or manipulation of AI outputs. As cyber threats become more sophisticated, we must invest in advanced security measures and continuously monitor our ~~directors~~AI systems to mitigate potential risks. We securely store sensitive data, and ~~officers~~any breach—whether physical or ~~specific~~electronic—of ~~stockholders~~the systems housing this information could lead to significant risks, including data piracy or compromise.

~~In addition~~Additionally, third-party inpartners ~~the~~may ~~past,~~be ~~stockholders~~granted ~~have~~access ~~initiated class~~to ~~action~~our ~~lawsuits~~proprietary ~~against~~information ~~technology~~to ~~companies~~provide ~~following~~necessary ~~periods~~services, which involves a risk of ~~volatility~~data misappropriation inor unauthorized use. A data intrusion into the ~~market~~servers ~~prices~~hosting ofour ~~these~~products ~~companies’~~could ~~stock. Such~~disrupt ~~litigation~~operations, ifparticularly ~~instituted~~for those ~~against~~offering ~~us,~~online ~~could~~features. ~~cause~~The usrisks toassociated ~~incur~~with ~~substantial~~such ~~costs~~breaches ~~and~~may ~~divert~~be ~~management’s~~heightened ~~attention~~by ~~and~~global ~~resources~~events, further complicating our cybersecurity posture.

4142

WeDisruption to ~~are~~our ~~controlled~~information bytechnology systems, network failures, or security breaches could negatively impact our ~~majority~~business ~~stockholder~~continuity, operations, ~~which~~and ~~limits~~financial results. These risks are confined to the ~~ability~~networks and e-commerce platforms of ~~other~~console ~~stockholders~~providers toand ~~affect~~online ~~our~~partners. ~~management~~External factors, such as extended remote work arrangements, geopolitical tensions, and internal factors like data migration and system maintenance, further exacerbate these risks.

~~Michael Jonas is our controlling stockholder,~~Our ~~Executive~~systems ~~Chairman,~~and ~~Chairman~~those of our ~~Board~~third-party ofservice ~~Directors,~~providers ~~and,~~may asnot ofalways ~~October~~be ~~28,~~fully ~~2024,~~adequate ~~had~~against ~~voting~~all ~~power over approximately 58~~vulnerabilities.1% ofWe ~~the~~lack redundancy ~~combined~~for ~~voting~~every ~~power~~system, ofand our ~~outstanding~~disaster ~~capital~~recovery ~~stock.~~planning ~~Mr.~~may ~~Jonas~~not isaccount ~~able~~for toall ~~control~~contingencies. ~~matters~~As ~~requiring~~our ~~approval~~digital bybusiness ~~our~~continues ~~stockholders~~to expand, ~~including~~we ~~the~~will ~~election~~require ofincreasingly ~~all~~robust ofinternal ~~the~~and ~~directors~~external ~~and~~technological ~~the~~infrastructure ~~approval~~to ofmeet ~~significant~~player ~~corporate~~demands. ~~matters,~~Failure ~~including~~to ~~any~~adapt ~~merger,~~and ~~consolidation~~effectively orscale ~~sale~~this ofinfrastructure ~~all~~may orcompromise ~~substantially all of our assets. As a result,~~ the ~~ability~~performance ofand ~~any~~reliability of our ~~other~~products ~~stockholders~~and tonegatively ~~influence~~impact our ~~management is limited~~business.

IfThe investment ~~securities~~needed to eliminate or ~~industry~~address ~~analysts~~security dothreats ~~not~~and vulnerabilities before or after a cyber-incident could be material. Our ~~publish~~remediation ~~research~~efforts may not be successful and could result in interruptions, delays or ~~publish~~cessation ~~unfavorable~~of ~~research~~service, ~~about~~and ~~our~~loss ~~business~~of existing or potential suppliers, users, or creators. As threats related to cyber-attacks continuously evolve and grow, we may also find it necessary to invest additional resources in protecting our ~~stock~~data and infrastructure, which may impact our ~~stock~~results ~~price~~of operations. Although we have insurance coverage protection against cyber-attacks, it may not be sufficient to cover all possible claims stemming from security breaches, cyberattacks and ~~trading~~other ~~volume~~types of unlawful activity, or any resulting disruptions from such events, and we may suffer losses that could have ~~decline~~a material adverse effect on our business. We could also be negatively impacted by existing and proposed laws and regulations in the United States, Lithuania, Israel, the European Union, and other jurisdictions, as well as government policies and practices related to cybersecurity, data privacy, data localization and data protection.

~~The trading market for our common Class B common stock relies in part on the research and reports that equity research analysts publish about us and our business. Currently~~Furthermore, ~~only one~~ ~~investment bank, Maxim Group LLC, publishes equity research about Zedge and there are no guarantees that they will continue providing coverage in~~ the ~~future.~~exploitation ~~We may never obtain research coverage by other equity research analysts. Equity research analysts may elect not to provide research coverage~~ of our ~~Class~~systems Bcan ~~common stock, and such lack of research coverage may~~ adversely affect ~~the market price of~~ our ~~Class~~products Band ~~common stock~~services. WeThe dovirtual ~~not~~economies ~~have~~within ~~any~~many ~~control~~of ~~over~~our ~~the~~digital ~~equity~~offerings are ~~research~~particularly ~~analysts~~susceptible orto ~~their~~abuse ~~content~~ and ~~opinions~~fraudulent ~~included in their reports~~activities. ~~The~~Despite ~~price~~implementing ofongoing ~~our~~measures ~~stock~~to ~~could~~prevent ~~decline~~such ~~if one or more equity research analysts downgrade our stock or~~ issues, ~~other unfavorable~~activities ~~commentary~~like orthe ~~research.~~illicit Ifgeneration ~~one~~and orsale ~~more equity research analysts ceases coverage~~ of ~~our~~accounts ~~company~~ or ~~fails~~virtual toitems ~~publish~~can ~~reports~~result onin usloss ~~regularly~~of revenue, ~~demand~~ ~~for~~interfere ~~our~~with ~~stock~~player ~~could decrease~~enjoyment, ~~which in turn could~~ and cause ~~our~~reputational ~~stock price and/or trading volume to decline~~harm.

~~Our~~In addition, ~~results~~the ofplatforms ~~operations~~that we use to distribute our apps may beencourage, ~~subject~~or torequire, compliance with certain security standards, such ~~wide~~as ~~fluctuations~~the ~~due~~voluntary tocybersecurity aframework ~~number~~released by the National Institute of ~~factors,~~Standards and Technology which ~~may~~consists ~~adversely~~of ~~affect~~controls designed to identify and manage cyber-security risks, and we could be negatively impacted to the ~~trading~~extent ~~price~~we ofare ~~our~~unable ~~Class~~to Bcomply ~~common~~with ~~stock~~such standards.

~~We may experience seasonality and other fluctuations~~RISKS inRELATED ~~our~~TO ~~business,~~OUR ~~reflecting~~OWNERSHIP ~~fluctuations~~AND inOUR ~~internet~~CLASS and smartphone usage and advertising. Revenues from consumer internet and mobile application products and services are typically higher in the fourth quarter of the calendar year due to increased year-end advertising and marketing budgets. Conversely, we generally experience lower advertising revenues during the first quarter of the calendar year due to weaker advertising spend following the holidays. Thus, our operating results in one or more future quarters or years may fluctuate substantially or fall below the expectations of securities analysts and investors. In such an event, the trading price of our Class B ~~common~~ ~~stock~~COMMON ~~may fluctuate significantly or decrease significantly.~~STOCK

~~Item~~We have ~~1B.~~granted, ~~Unresolved~~and ~~Staff~~may ~~Comments~~continue to grant, options, restricted shares and other types of awards under our stock option and equity incentive plans and otherwise, which may result in increased equity-based compensation expenses.

~~None~~The expenses associated with equity-based compensation, including the potential repricing of options, have affected our net income and may reduce our net income in the future, and any additional equity issued under equity-based compensation schemes will dilute the ownership interests of our stockholders. We believe the granting of equity-based compensation is of significant importance to our ability to attract and retain key personnel and employees, consultants and directors, and we will continue to grant equity-based compensation in the future. As a result, our expenses associated with equity-based compensation may increase, which may have an adverse effect on our results of operations and would dilute the ownership interests of our stockholders.

~~Item~~Investors may C.suffer ~~Cybersecurity~~dilution.

~~Cybersecurity risk~~We may ~~management~~engage in equity financing to fund our future operations and ~~strategy~~growth or acquisitions. If we raise additional funds and/or provide consideration in acquisitions by issuing equity securities, stockholders may experience significant dilution of their ownership interest (both with respect to the percentage of total securities held, and with respect to the book value of their securities) and such securities may have rights senior to those of the holders of our Class B common stock.

~~Our cybersecurity risk management is based on~~Any ~~recognized~~such ~~cybersecurity~~equity ~~industry~~financing ~~frameworks~~could ~~and~~occur ~~standards,~~at ~~including~~prices ~~those of the National Institute of Standards and Technology~~below, ~~the Center for Internet Security Controls, and the International Organization for Standardization. This does not imply that we meet any particular technical standards, specifications,~~ or ~~requirements,~~well ~~only that we use the aforementioned frameworks and standards as a guide to help us identify~~below, ~~assess, and manage cybersecurity risks relevant to our business. We use these frameworks, together with information collected from internal assessments, to de~~

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