D-Box Technologies Inc. (“D-Box” or the “Company”) (TSX: DBO) today reported financial results for its second quarter ended September 30, 2025.

“In Q2 2026, D-Box royalties continued to outpace market benchmarks,” said Naveen Prasad, CEO of D-Box. “Driven by the continued expansion of our footprint, we have set new quarterly highs in key financial indicators including royalties and net profit. Our ongoing screen expansion, driven by a growing network of exhibitor circuits, underscores the value we contribute through our immersive technology to the theatrical ecosystem. D-Box is now being rolled out even deeper in complexes due to the demand for our haptic experiences long after opening weekend. We are pleased to see the positive response to our solution, which is the result of our dedicated and loyal customer base.”

Q2 2026 Operating Results

Second quarter royalty revenues reached a second consecutive quarterly record at $4.5 million. This is an increase of 40% year over year and compares extremely favorably to the gross domestic box office which declined 11.1%¹ in the same period. D-Box encoded feature films continue to demonstrate consistent performance across a wide range of content, including “Jurassic World: Rebirth,” “Superman,” “The Fantastic Four: First Steps” and “The Conjuring: Last Rites,” regardless of box office traction among other formats. D-Box continued to expand its market presence, achieving a 13.5% year-over-year increase in screen footprint worldwide, bringing total active screens to 1,084.

Theatrical system sales increased 62% year-over-year, to a record $6.4 million. These record results combined with a solid sales pipeline are indicative of the positive traction our brand is currently experiencing, particularly in the U.S., Australian and in Latin American markets. Simulation and training and sim racing customer groups combined were relatively flat, up 3% year-over-year, in the second quarter. Theatrical customers therefore drove the increase in total revenues to a record $16.1 million, up 33% year-over-year.

Net profit reached a record $4.5 million despite a $0.4 million restructuring charge related to the CFO transition announced on August 13, 2025. Adjusted EBITDA for the quarter totaled a record $5.6 million, representing a 35% Adjusted EBITDA margin, up 93% year-over-year and demonstrating continued focus on cost control and operational efficiency.

Given the inherent variability and seasonality of quarterly sales, we emphasize the importance of assessing the Company’s performance on a trailing twelve-month basis.

Year-to-date Operating Results

Theatrical customers constituted 65% of total revenues for the first half ended September 30, 2025, compared to 49% in the prior year. The Company’s theatrical system sales surged by 132%, while royalties experienced a notable 51% uptick. These combined factors contributed to a record-breaking first half of the year, with net profit reaching $6.5 million, despite a $1.2 million restructuring charge related to the transition of the CEO and CFO roles. Gross margin increased three percentage points, from 53% to 56%. This change can be attributed largely to market mix and the previously mentioned increase in high-margin royalty revenues. The company has successfully paid off all its interest-bearing debt, positioning it well to capitalize on future cash flows from operations.

Balance Sheet and Liquidity

D-Box closed the second quarter of fiscal 2026 in a position of financial strength, with $10.6 million in cash against total debt of $0.4 million which is non-interest bearing.

Non-IFRS and other financial performance measures

D-Box uses the following non-IFRS financial performance measures in its MD&A and other communications. The non-IFRS measures do not have any standardized meaning prescribed by IFRS and are unlikely to be comparable to similarly titled measures reported by other companies. Investors are cautioned that the disclosure of these metrics is meant to add to, and not to replace, the discussion of financial results determined in accordance with IFRS. Management uses both IFRS and non-IFRS measures when planning, monitoring and evaluating the Company’s performance. The non-IFRS performance measures are described as follows:

Adjusted EBITDA

EBITDA represents earnings before interest and financing, income taxes and depreciation and amortization. Adjustments to EBITDA are for items that are not necessarily reflective of the Company’s underlying operating performance. As there is no generally accepted method of calculating EBITDA, this measure is not necessarily comparable to similarly titled measures reported by other issuers. Adjusted EBITDA provides useful and complementary information, which can be used, in particular, to assess profitability and cash flow from operations.

Total Debt, Net Debt and Total Debt to Adjusted EBITDA

Total debt is defined as the total bank indebtedness, long-term debt (including any current portion), and net debt is calculated as total debt net of cash and cash equivalents. The Company considers total debt and net debt to be important indicators for management and investors to assess the financial position and liquidity of the Company and measure its financial leverage. These measures do not have any standardized meanings prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Total debt to Adjusted EBITDA ratio is calculated as total net debt divided by the last four quarters Adjusted EBITDA. We believe that total debt to Adjusted EBITDA is a useful metric to assess the Company’s ability to manage debt and liquidity.

About D-Box
D-Box Technologies Inc. (TSX: DBO) is a global leader in haptic technology, delivering immersive motion experiences that engage the body and spark the imagination. Our patented systems synchronize motion, vibration, and texture with on-screen content, enhancing storytelling across various platforms. With over 25 years of innovation, D-Box’s solutions are utilized in movie theaters, sim racing, and simulation & training. Headquartered in Montreal, Canada, with offices in Los Angeles, USA, D-Box continues to redefine how audiences experience media worldwide. Visit https://www.d-box.com/.