Adjusted EBITDA (non-GAAP) improves 39.2%, revenue grows 2.8%, and GAAP operating loss improves 14.0% quarter-over-quarter NEW YORK , Nov. 03, 2026 (GLOBE NEWSWIRE) -- Fusemachines Inc. (Nasdaq: FUSE) (“Fusemachines” or the “Company”), a leading provider of enterprise AI products and services, today announced its financial results for the third quarter ended September 30, 2026 , reporting significant improvements in operating performance, continued quarter-over-quarter revenue growth, and a strengthened stockholders’ equity position. The Company’s GAAP loss from operations improved 14.0% to $2.3 million , while revenue increased 2.8% to $1.85 million . Its GAAP net loss was $4.6 million , compared with $2.8 million in the second quarter of 2026, and included a $2.2 million non-cash charge associated with the change in the fair value of its forward purchase derivative liability. The Company also reported a 39.2% quarter-over-quarter improvement in Adjusted EBITDA, a non-GAAP financial measure, with its Adjusted EBITDA loss narrowing to $1.4 million from $2.3 million in the second quarter of 2026. These improvements reflect the impact of the Company's cost-reduction initiatives which have lowered operating expenses without affecting continued revenue growth. The Company also improved stockholders’ equity by $9.1 million during the quarter, reducing its stockholders’ deficit by 52.7%, primarily as a result of forward purchase agreement transactions, and shares issued to settle vendor invoices and employee obligations. The Company continues to have a stockholders’ deficit and negative operating cash flow, and its financial statements disclose substantial doubt about its ability to continue as a going concern. “Our 39.2% quarter-over-quarter improvement in our Adjusted EBITDA demonstrates the meaningful progress we are making in improving the financial and operational performance of Fusemachines,” said Sameer Maskey , Founder and Chief Executive Officer of Fusemachines. “Our cost-reduction initiatives are delivering measurable results, allowing us to significantly reduce operating losses while continuing to grow revenue. We remain focused on building a more efficient operating structure, strengthening our financial position, and advancing our enterprise AI business.” Third Quarter 2026 Financial Highlights Adjusted EBITDA (non-GAAP) improved 39.2% quarter-over-quarter, with the non-GAAP loss narrowing to $1.4 million compared with $2.3 million in Q2 2026, an improvement of $0.9 million . GAAP net loss was $4.6 million , or $.15 per basic and diluted share, compared with $2.8 million , or $.10 per basic and diluted share, in Q2 2026, including a $2.2 million non-cash loss associated with the change in fair value of the forward purchase derivative liability. GAAP loss from operations improved 14.0%, narrowing to $2.3 million compared with $2.7 million in the prior quarter. Revenue increased 2.8% quarter-over-quarter to $1.85 million compared with $1.79 million in the prior quarter. Total operating expenses declined 9.8% to $3.3 million from $3.7 million in Q2 2026. Combined cost of revenue and operating expenses declined 7.2% to $4.2 million from $4.5 million , demonstrating improved overall cost efficiency. Stockholders’ equity improved by $9.1 million , reducing the stockholders’ deficit from $17.4 million at June 30, 2026 , to $8.2 million at September 30, 2026 , primarily as a result of forward purchase agreement transactions and share issuances for payables and accrued wages. Improving Operational Efficiency While Growing Revenue During the third quarter, Fusemachines continued executing cost-reduction initiatives designed to improve operating efficiency while supporting the growth of its enterprise AI business. Total operating expenses declined 9.8% sequentially, with general and administrative expenses decreasing 10.9% and selling and marketing expenses declining 7.0%. Combined cost of revenue and operating expenses fell 7.2% compared with the prior quarter. Despite these expense reductions, quarterly revenue increased to $1.85 million from $1.79 million , representing 2.8% sequential growth. The combination of higher revenue and lower operating expenses contributed to a 14.0% improvement in GAAP operating loss and a 39.2% improvement in Adjusted EBITDA, highlighting the effectiveness of the Company's ongoing operational restructuring and cost-management efforts. Non-GAAP Financial Measures This press release includes Adjusted EBITDA, a non-GAAP financial measure. Fusemachines defines Adjusted EBITDA as net loss before interest expense, income taxes, depreciation and amortization, adjusted for stock-based compensation, including restricted stock units, changes in fair value, gains or losses on extinguishment of debt and payables, and severance expense. Management uses Adjusted EBITDA to evaluate the Company’s operating performance and the results of its cost-reduction initiatives, and believes it provides i