Zedge, Inc. (NYSE: ZDGE) announced a $7.5 million direct investment led by Vice Chairman Howard Jonas to accelerate its DataSeeds.AI business. Morris Berger joins as CEO on October 1, 2026.

The capital injection aims to expand DataSeeds’ capabilities in the AI data value chain. The company reported $19.7 million in cash and no debt at the end of Q3FY26.

Investment Structure

The investment involves participation from Board Member Elliott Gibber and another insider. It is expected to close within 10 days of the announcement. Zedge will not pay investment banking fees.

Warrants are not exercisable until six months after issuance and shareholder approval. They will not be listed for trading.

Leadership Transition

Morris Berger, currently CEO of Zeno Media, replaces Jonathan Reich as CEO. Reich transitions to President and Chief Operating Officer. Berger previously served as CEO of IDT Entertainment and Zedge.

Financial Position

Zedge generated $1.2 million in free cash flow in Q3FY26, a 55% year-over-year increase. The company suspended its share repurchase program but plans to continue quarterly dividends.

What the Numbers Show

DataSeeds secured its first six-figure order from a global technology company in FY26. This commercial validation coincides with the strategic pivot toward managed data creation, leveraging Zedge’s existing creator communities and the new DataSeeds Production Cloud infrastructure.

Zedge, Inc. announced an agreement with the estate of Betty Wright to bring the late soul legend's catalog to its Tapedeck platform. The agreement, timed to Juneteenth, adds the works of the six-time Grammy nominee, known for hits like "Clean Up Woman," to the service. This move aligns with Tapedeck's model where artists and rights holders set their own prices, with a penny-per-play floor and no ceiling, ensuring 80% of fan spending flows directly to rights holders.

Betty Wright, who died in 2020, was the first Black woman to earn a gold record on a label she owned, Ms. B Records, in 1988. Her estate views the partnership as an extension of her vision for artist ownership and direct fan connection. "My mother believed that artists should own their art, protect their creative vision, and connect directly with their fans without barriers," said Namphuyo Aisha McCray, Wright's eldest daughter.

Tapedeck Expansion

The agreement extends a series of recent licensing deals for Tapedeck, including partnerships with Cinq Music, Tuff Gong Distribution, and BWL Entertainment. Tapedeck launched on iOS in the U.S. in fall 2025, with Android, web, and international expansion planned for 2026. The service operates on a pay-as-you-go model without subscription fees, allowing fans to pay only for what they play.

Recent Financial Performance

Separately, Zedge reported financial results for the third quarter of fiscal 2026. The company achieved a GAAP net income of $0.9 million, a significant increase from $0.2 million in the prior year. Total revenue grew 3.0% to $8.0 million, driven by a 32% rise in subscription revenue to $1.7 million. Active subscriptions increased by 41% to nearly 1.3 million.

Third Quarter Financial Metrics

The company's balance sheet remains robust with cash and cash equivalents of $19.7 million and no debt. Subsequent to the quarter's end, the board added $2 million to its share repurchase authorization.