Digital Turbine has put the worst of its 2024-2025 contraction behind it. Net revenue in the fiscal second quarter ended June 30, 2026, climbed to $165.98 million, up 26.8% from $130.93 million a year earlier, and the company swung from a $4.66 million operating loss in the prior-year quarter to $23.06 million of operating income. That step-change in profitability came from both segments at once, with On Device Solutions revenue rising 15.2% and App Growth Platform revenue rising 55.9% on a comparable basis, and with operating expenses held flat or down year-over-year. The fiscal-2026 full-year results, released in May, showed the same pattern in slower motion: revenue grew 15.2% to $565.25 million, the operating loss of $54.08 million in fiscal 2025 turned into $34.04 million of operating income, and the net loss narrowed to $37.73 million from $92.10 million.
The fly in the ointment is below the operating line. Interest expense, net, in the second quarter climbed 29.5% to $12.89 million as the company's August 2025 refinancing onto a Blue Torch-led financing agreement pushed its average borrowing rate to 11.65% from 8.63%, and an unrealized loss on derivative warrants of $10.80 million was added to the mix. Even so, the quarter still produced a smaller net loss than the comparable period, and the company used $4.70 million of asset-sale proceeds alongside internally generated cash to reduce debt. The trade here is straightforward: a credible operational turnaround with the balance sheet still under repair, and the next twelve months hinge on whether management can refinance or pay down the higher-cost Blue Torch tranches before a $5.00 million duration-fee trigger on December 31, 2026.