Surgepays (NASDAQ:SURG) released first-quarter financial results and hosted an earnings call on Friday. Read the complete transcript below.
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Access the full call at https://www.webcaster5.com/Webcast/Page/3060/54033
Summary
Surgepays Inc reported a 51% year-over-year revenue growth to $16 million for Q1 2026, driven primarily by a 71% increase in point of sale and prepaid services.
The company achieved a milestone of surpassing 200,000 wireless subscribers and initiated a Buy One Get One campaign to further drive subscriber growth.
Surgepays Inc reduced customer acquisition costs significantly by transitioning its marketing in-house, resulting in a 28% reduction in cost per lead and a 48% reduction in cost per enrollment.
Six new wholesale distribution partners were added, expected to increase prepaid top-up volume by 30% once fully integrated.
New monetization layers were introduced, including a stored value and loyalty program and a managed marketing services platform, contributing to incremental revenue.
The company anticipates continued revenue growth and operational expansion, with strategic partnerships and wholesale wireless revenues expected to contribute in the upcoming quarters.
Full Transcript
OPERATOR
Good morning and welcome to the Surgepays Inc’s First Quarter 2026 Financial Results Conference call. At this time, all participants are on a listen-only mode and a question and answer session will follow management’s prepared remarks. Please note this event is being recorded. I would now like to turn the conference over to Walter Pinto with KCSA Strategic Communications. Walter, please go ahead.
Walter Pinto
Thank you operator and good morning everyone. Welcome to the Surgepays Inc’s first quarter 2026 financial results conference Call. Joining me on the call today are Brian Cox, Chief Executive Officer and Chelsea Polano, Interim Chief Financial Officer. Before we begin, I’d like to remind everyone that statements made on this call that are not historical facts, may be forward looking statements within the meaning of the Private Securities Litigation Reform act of 1995. These statements involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied. Additional information about these risks is included in the Company’s filings with the securities and Exchange Commission, including its annual report on Form 10K and subsequent quarterly reports on Form 10Q. The company undertakes no obligation to update these statements except as required by law. With that, I’d like to now turn the call over to Brian Cox. Brian, please go ahead.
Brian Cox (Chief Executive Officer)
Thank you, Walter and good morning everyone. Thank you for joining us today. The first quarter of 2026 is the quarter where diversification work of the last 12 months becomes visible. In the numbers, revenue grew approximately 51% year over year to 16 million, driven by an approximately 71% increase in point of sale and prepaid services. At the same time, the cost discipline we set in motion in 2025 reached our general and administrative expense line which declined approximately 25% year over year. Today, Surge Pays operates with multiple revenue channels working in parallel. Total wireless subscriber lines across our LinkUp Mobile and Torch wireless brands surpassed 200,000 subscribers during the quarter. Our point of sale platform continues to scale across a retail footprint of more than 9,000 convenience store locations nationwide. We have added new monetization channels on top of that footprint, including a stored value and loyalty program and a managed marketing services platform for the in store media network we launched during the quarter and we have rebuilt the top of our acquisition funnel through ProgramBenefits.com which is now serving as both a unified intake and decisioning platform and a monetization layer for the subscribers it brings in. The way to think about this business is straightforward. Every consumer Surge Pays acquires can now be paired with additional financial and benefit products distributed through the same platform. That is the compounding model we designed Q1 is the first quarter where you can see it forming in the financials, and we’re going to walk you through each one of the operating pieces that drove that. There are five operating themes that define the first quarter and that frame how we expect the rest of the year to unfold. First, Wireless Subscriber Growth Total wireless subscriber lines across our LinkUp Mobile and Torch wireless brands surpassed 200,000 during this quarter. That’s a milestone the team has worked toward for several quarters and it reflects the operational work we have done to scale the prepaid wireless business in house. To press that momentum further, we initiated a Buy one get one promotional campaign in our prepaid wireless business designed to drive subscriber growth and increase market penetration across our retail and digital channels. Second, the Customer Acquisition engine this is one of the most important shifts inside the company and I want to spend a minute on it. During the first quarter we transitioned subscriber acquisition to our in house growth marketing team. For the past five years this has been outsourced to third party ad agencies. Since that transition, we have reduced customers cost per lead by approximately 28%. Cost per enrollment is down approximately 48% and our lead to enrollment conversion rate is up approximately 39%. We are paying less to acquire each new customer. Fewer of those leads fall out of the funnel and the customers we bring on cost materially less than than they did one quarter ago. Our marketing team is winning. That is a structural improvement in unit economics that’s impactful now, but even more so as we ramp up our sales push on top of that engine. We have continued to scale ProgramBenefits.com as both a unified intake and decisioning platform and as a monetization layer for the subscriber base. Internal upsells, top up, cross sell affiliate offers and data partnership initiatives are now generating revenue against those subscribers. This partially offsets the acquisition costs. In other words, the funnel is starting to pay for itself and our end of year goal is to continue improving this funnel so we effectively eliminate our cost to acquire customers entirely. Third, wholesale distribution expansion during the period we closed six new …
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