ZDGE Zedge Inc

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

  

CURRENT REPORT

 

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

 

Date of Report (Date of earliest event reported): January 20, 2025

 

 

Zedge, Inc.

(Exact name of registrant as specified in its charter)

 

 

Delaware		1-37782		26-3199071
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

 

1178 Broadway, Ste. 1450 (3rd Floor) New York, NY		10001
(Address of principal executive offices)		(Zip Code)

 

Registrant’s telephone number, including area code: (330) 577-3424

 

Not Applicable

(Former name or former address, if changed since last report.)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

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

 

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

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

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.  ☐

 

 

 

Item 2.05. Costs Associated with Exit or Disposal Activities.

 

On January 21, 2025, Zedge, Inc. (the “Company”) announced a corporate restructuring, which includes a workforce reduction involving approximately 14 employees, representing approximately 14% of our global workforce. These changes reflect efforts to improve profitability and position the Company for long-term growth. These actions were approved by the Company’s Board of Directors on January 20, 2025.

 

The Company is not currently able to estimate the non-recurring costs it expects to incur as a result of this workforce reduction, most of which it expects to incur in the second and third quarters of fiscal year 2025 (the periods ending January 31, 2025 and April 30, 2025).

 

Item 7.01. Regulation FD Disclosure.

 

On January 21, 2025, the Company issued a press release announcing a restructuring plan. A copy of the press release is furnished as Exhibit 99.1 and is incorporated herein by reference.

 

The Company is furnishing the information contained in this Report, including Exhibit 99.1, pursuant to Item 7.01 of Form 8-K promulgated by the Securities and Exchange Commission (the “SEC”). This information shall not be deemed to be “filed” with the SEC or incorporated by reference into any other filing with the SEC. In addition, the press release contains statements intended as “forward-looking statements” that are subject to the cautionary statements about forward-looking statements set forth in the press release.

 

Forward-Looking Statements

 

This current report on Form 8-K contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect the Company’s current views with respect to, among other things, its operations, including the recently announced plan to implement a global workforce reduction and restructuring of our operations and its expected impact, its financial performance, its industry and its business. Forward-looking statements include all statements that are not historical facts. In some cases, you can identify these forward-looking statements by the use of words such as “outlook,” “believe(s),” “expect(s),” “potential,” “continue(s),” “may,” “will,” “should,” “could,” “would,” “seek(s),” “predict(s),” “intend(s),” “trends,” “plan(s),” “estimate(s),” “anticipates,” “projection,” “will likely result” and or the negative version of these words or other comparable words of a future or forward-looking nature. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. These factors include but are not limited to those described under “Item 1A. Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended July 31, 2024 filed with the Securities and Exchange Commission (the “SEC”) as such factors may be updated from time to time in the Company’s periodic filings with the SEC. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that

 

Item 9.01. Financial Statements and Exhibits.

 

(d)       Exhibits.

 

Exhibit No		Document
99.1		Press Release issued January 21, 2025.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document).

 

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

	ZEDGE, INC.
	By:	/s/ Jonathan Reich
	Name:	Jonathan Reich
	Title:	Chief Executive Officer

 

Dated: January 21, 2025

 

 

EXHIBIT INDEX

 

Exhibit No		Document
99.1		Press Release issued January 21, 2025.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document).

 

 

3

Exhibit 99.1

 

Zedge Announces GuruShots Restructuring to Improve Profitability and Position Itself for Long-term Growth

 

Initiatives, including an approximate 14% reduction in Zedge’s global headcount, mostly

impacting GuruShots, are expected to lower costs by approximately $1.7 million (pre-tax) on an annualized basis

 

Cost reductions expected to enhance profitability and cash flow

 

Comprehensive overhaul of the GuruShots game underway, targeting much-improved player

experience to drive future growth

 

New York, NY – January 21, 2025: Zedge, Inc. (NYSE AMERICAN: ZDGE), $ZDGE, a leader in digital marketplaces and interactive games that provide content, enable creativity, empower self-expression and facilitate community, today announced a corporate restructuring designed to streamline operations and enhance profitability. The Company expects the restructuring, which includes employees and contractors, will reduce Zedge’s global workforce by approximately 14% and generate approximately $1.7 million in pre-tax, annualized cost savings with additional cost benefits from lower discretionary spending related to GuruShots during the remainder of fiscal 2025.

 

Jonathan Reich, CEO of Zedge, commented:

 

“Given its ongoing drag on our results, we are rightsizing GuruShots to reduce costs while at the same time reimagining the game and growth plan with our GuruShots 2.0 initiative. We continue to believe that GuruShots can be accretive to Zedge’s growth and profitability, and we remain encouraged by the positive response from industry insiders, photo enthusiasts and consumers who find the value proposition, mainly gamifying photography, exciting, captivating and attractive. This feedback gives us the impetus to forge forward and evolve the game by developing a meaningfully better player experience, including a significantly improved user interface. Ultimately, we expect to make GuruShots even more engaging and enjoyable for both new and existing players, as our legacy users remain a loyal and coveted part of our community that deserve ongoing investment and attention.

 

Reimagining GuruShots Gameplay and Monetization

 

Zedge is undertaking a comprehensive evaluation of the GuruShots game. As part of the review, the rightsized GuruShots team will prioritize initiatives that improve gameplay for both existing and new players, including conducting a comprehensive assessment of the gaming technology infrastructure best suited for delivering a superior overall player experience. Additionally, the GuruShots team is actively exploring new ways to monetize the game to drive revenue growth. Once the GuruShots 2.0 strategy and product roadmap are solidified, Zedge anticipates re-allocating investment into the game based on meeting select milestones.

 

Key Cost Savings Initiatives

 

Rightsizing GuruShots Workforce

 

As part of the restructuring, the GuruShots organization will undergo significant changes, including rightsizing the workforce, which is expected to enable GuruShots to approach breakeven while developing the GuruShots 2.0 product strategy.

 

GuruShots Player Acquisition Spend to Decrease for the Remainder of FY25

 

In addition to headcount reductions, GuruShots will cut back on previously budgeted paid player acquisition for at least the remainder of the fiscal year, only allocating marketing dollars to player acquisition campaigns that deliver attractive Return on Ad Spend (ROAS) metrics.

 

Financial Impact

 

The Company expects that most of the restructuring charges associated with today’s announced cost-reduction initiatives will be reported in its second (ending January 31, 2025) and third (ending April 30, 2025) fiscal quarters’ results.

 

 

About Zedge

 

Zedge empowers tens of millions of consumers and creators each month with its suite of interconnected platforms that enable creativity, self-expression and e-commerce and foster community through fun competitions. Zedge’s ecosystem of product offerings includes the Zedge Marketplace, a freemium marketplace offering mobile phone wallpapers, video wallpapers, ringtones, notification sounds, and pAInt, a generative AI image maker; GuruShots, “The World’s Greatest Photography Game,” a skill-based photo challenge game; and Emojipedia, the #1 trusted source for ‘all things emoji.’ For more information, visit https://www.investor.zedge.net/ .

 

Follow us on X: @Zedge @Emojipedia

Follow us on Zedge LinkedIn Emojipedia LinkedIn

 

Download the Zedge App:

 

 

Download the GuruShots App:

 

 

Contact:

 

Brian Siegel, IRC, MBA

Senior Managing Director

Hayden IR

(346) 396-8696

ir@zedge.net

 

 

 

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