This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. We use words such as “believes”, “intends”, “expects”, “anticipates”, “plans”, “may”, “will” and similar expressions to identify forward-looking statements. All forward-looking statements, including, but not limited to, statements regarding our future operating results, financial position, prospects, acquisitions, dispositions, and business strategy, expectations regarding our growth and the growth of the industry in which we operate, and plans and objectives of management for future operations, are inherently uncertain as they are based on our expectations and assumptions concerning future events. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements we make. There are a number of important factors that could cause the actual results of Marchex to differ materially from those indicated by such forward-looking statements. Any or all of our forward-looking statements in this report may turn out to be inaccurate. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. They may be affected by inaccurate assumptions we might make or by known or unknown risks and uncertainties, including but not limited to the risks, uncertainties and assumptions described in this report, in Part II, Item 1A. under the caption “Risk Factors” and elsewhere in this report and in our Form 10-K for the year ended December 31, 2025, as amended, and those described from time to time in our future reports filed with the SEC. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this report may not occur as contemplated and actual results could differ materially from those anticipated or implied by the forward-looking statements. All forward-looking statements in this report are made as of the date hereof, based on information available to us as of the date hereof, and we assume no obligation to update any forward-looking statement. Overview Marchex and Archenia together harness proprietary AI-powered conversational intelligence and advanced customer acquisition technologies to transform consumer intent into actionable, outcome-driven business results. The combination of Marchex's prescriptive analytics and omnichannel intelligence with Archenia's AI-verified qualification, natural-language analytics, and automated decisioning capabilities creates a highly differentiated customer acquisition and optimization technology platform. Leveraging real-time AI signals, machine-learning models, and deep vertical market expertise, the company identifies consumer intent, improves qualification accuracy, and delivers verified outcomes such as high-intent conversations, appointments, and sales. Serving market leading companies across major verticals including automotive, insurance, home services, healthcare, and advertising/media, Marchex empowers organizations to optimize customer engagement and drive revenue growth through AI-driven insights, actions, and outcomes. Our mission is to create intelligence around all types of business conversations. We desire to be a leader in vertical market conversational intelligence leveraging generative AI and data analytics. We seek to empower performance improvements for our customers by giving them actionable, real-time insights into the conversations they are having with their customers across phone, text, and other communication channels. We have assembled a set of applications that incorporate AI functionality for enterprises that depend on phone calls, texts, and other communication channels to help convert prospects into customers, enabling compelling customer experiences during the sales process and helping maximize returns. Our proprietary data and conversational insights help enable brands to personalize customer interactions in order to accelerate sales and capture more opportunities to grow their business. We serve large enterprises with a distributed footprint that interact with their customers across multiple communication paths. We were incorporated in Delaware on January 17, 2003. We have office space in Seattle, WA. 16 Table of Contents Recent Developments On July 1, 2026, the Company consummated the previously-announced acquisition of 100% of the outstanding shares of capital stock of Archenia, Inc. from its stockholders, pursuant to the SPA, dated May 8, 2026, by and among the Company and sellers. In acquiring 100% of the outstanding shares of capital stock of Archenia, the Company indirectly acquired all of the assets that support Archenia’s business. See Note 13: Acquisition SPA Information for more information on the SPA and unaudited Pro Forma Combined Statements of Operations for the current year. Components of the Results of our Operations Revenue We generate the majority of our revenues from our conversational intelligence product offerings. Our AI-powered conversational analytics technology platform provides data and insights into the conversations our clients are having with their customers across phone, text, and other communication channels. Our tools enable brands to personalize customer interactions in order to accelerate sales and capture more opportunities to grow their business. We generate revenue when our customers pay us a fee for each call/text or call/text related data element they receive from calls or texts or for each phone number tracked based on a pre-negotiated rate. Customers typically receive the benefit of our services as they are performed and substantially all of our revenue is recognized over time as services are performed. Collection on the related receivables may vary from reported information based upon third-party refinement of the estimated and reported amounts owed that occurs subsequent to period ends. Cost of Revenue Our cost of revenue represents the cost of providing our services to our customers. These costs primarily consist of cloud computing and hosting costs; telecommunication costs, including the use of phone numbers relating to our services; bandwidth and software license fees; network operations; and payroll and related expenses of personnel, including stock-based compensation. Sales and Marketing Sales and marketing expenses consist primarily of payroll and related expenses for personnel engaged in marketing and sales functions; advertising and promotional expenditures including online and outside marketing activities; and stock-based compensation of related personnel. Product Development Product development costs consist primarily of expenses incurred in the research and development ("R&D") of our products and services. These costs primarily consist of payroll and related expenses for personnel; costs of computer hardware and software; costs incurred for features and functionality of the services we offer; and stock-based compensation of related personnel. For the periods presented, substantially all of our product development expenses are R&D and are expensed as incurred or capitalized into property and equipment in accordance with U.S. GAAP once requirements have been met. See Note 8: Property and Equipment for more information on software development capitalization. General and Administrative General and administrative expenses consist primarily of payroll and related expenses for executive and administrative personnel; professional services, including accounting, legal and insurance; bad debt provisions; facilities costs; other general corporate expenses; and stock-based compensation of related personnel. 17 Table of Contents Stock-Based Compensation We measure stock-based compensation cost at the grant date based on the fair value of the award and recognize it as expense over the vesting or service period, as applicable, of the stock-based award using the straight-line method. We account for forfeitures as they occur. Stock-based compensation expense is included in the same lines as compensation paid to the same employees in the Consolidated Statements of Operations. Provision for Income Taxes We utilize the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax law is recognized in results of operations in the period that includes the enactment date. Results of Operations The following tables present revenue and certain operating results as a percentage of revenue: Three Months Ended June 30, % of revenue Three Months Ended June 30, % of revenue (In Thousands, Except Percentages) 2026 2025 Revenue $ 11,002 100 % $ 11,655 100 % Expenses: Cost of revenue 4,289 39 % 4,058 35 % Cost of revenue - amortization of capitalized software development costs 115 1 % 10 0 % Total cost of revenue $ 4,404 40 % $ 4,068 35 % Sales and marketing 2,298 21 % 3,165 27 % Product development 1,991 18 % 2,501 21 % General and administrative 2,655 24 % 2,457 21 % Total operating expenses 11,348 103 % 12,191 105 % Loss from operations $ (346 ) -3 % $ (536 ) -5 % Six Months Ended June 30, % of revenue Six Months Ended June 30, % of revenue (In Thousands, Except Percentages) 2026 2025 Revenue $ 21,620 100 % $ 23,058 100 % Expenses: Cost of revenue 8,409 39 % 8,246 36 % Cost of revenue - amortization of capitalized software development costs 193 1 % 10 0 % Total cost of revenue $ 8,602 40 % $ 8,256 36 % Sales and marketing 5,556 26 % 6,431 28 % Product development 4,399 20 % 5,173 22 % General and administrative 4,760 22 % 5,604 24 % Total operating expenses 23,317 108 % 25,464 110 % Loss from operations $ (1,697 ) -8 % $ (2,406 ) -10 % 18 Table of Contents Stock-based compensation expense was included in the following operating expense categories: Three Months Ended June 30, Six Months Ended June 30, (In Thousands) 2026 2025 2026 2025 Cost of revenue $ 8 $ 2 $ 11 $ 3 Sales and marketing 196 172 367 196 Product development 101 78 202 105 General and administrative 226 304 440 707 Total stock-based compensation $ 531 $ 556 $ 1,020 $ 1,011 See Note 6: Stockholders' Equity of the Notes to the Consolidated Financial Statements, as well as our Critical Accounting Policies for additional information about stock-based compensation. Revenue Revenue decreased $0.7 million, or 6%, to $11.0 million for the three months ended June 30, 2026 from $11.7 million for the three months ended June 30, 2025. Revenue decreased $1.5 million, or 6%, to $21.6 million for the six months ended June 30, 2026 from $23.1 million for the six months ended June 30, 2025. The three and six month current year periods were impacted by certain new sales during the periods as well as offsets during the second half of 2025, largely due to customer migration activities from our legacy platforms onto the new Marchex Engage Platform. These offsets adversely impacted certain revenue run rates entering 2026 as compared to 2025. Expenses Cost of Revenue. Cost of revenue increased $0.3 million, or 7%, to $4.4 million for the three months ended June 30, 2026 from $4.1 million for the three months ended June 30, 2025. As a percentage of revenue, cost of revenue was 40% and 35% for the three months ended June 30, 2026 and 2025, respectively. During the three months ended June 30, 2026 depreciation costs increased $0.1 million as well as $0.2 million of other costs associated with customer pilot and other new revenue opportunities. Cost of revenue increased $0.3 million, or 4%, to $8.6 million for the six months ended June 30, 2026 from $8.3 million for the six months ended June 30, 2025. As a percentage of revenue, cost of revenue was 40% and 36% for the six months ended June 30, 2026 and 2025, respectively. During the six months ended June 30, 2026 depreciation costs increased $0.2 million and $0.2 million of other costs associated with customer pilot and other new revenue opportunities. The increase was offset by savings of $0.1 million realized as a result of the platform migration activities. Sales and Marketing. Sales and marketing expenses decreased $0.9 million, or 28%, to $2.3 million for the three months ended June 30, 2026 from $3.2 million for the three months ended June 30, 2025. As a percentage of revenue, sales and marketing expenses were 21% and 27% for the three months ended June 30, 2026 and 2025, respectively. During the three months ended June 30, 2026 payroll costs decreased $0.9 million. Sales and marketing expenses decreased $0.8 million, or 13%, to $5.6 million for the six months ended June 30, 2026 from $6.4 million for the six months ended June 30, 2025. As a percentage of revenue, sales and marketing expenses were 26% and 28% for the six months ended June 30, 2026 and 2025, respectively. During the six months ended June 30, 2026 payroll costs decreased $0.9 million which was offset by an increase in contract asset amortization charges of $0.1 million. The six months ended June 30, 2026 includes reorganization charges related to severance of $0.4 million. Product Development. Product development expenses decreased $0.5 million, or 20%, to $2.0 million for the three months ended June 30, 2026 from $2.5 million for the three months ended June 30, 2025. As a percentage of revenue, product development expenses were 18% and 21% for the three months ended June 30, 2026 and 2025, respectively. The three months ended June 30, 2026 includes reorganization charges of $0.1 million related to severance. Inclusive of the $0.1 million of reorganization charges the decrease was primarily attributable to $0.5 million in lower personnel and outside labor costs due the reorganization and realignment of our personnel that occurred in 2025 and 2026. 19 Table of Contents Product development expenses decreased $0.8 million, or 15%, to $4.4 million for the six months ended June 30, 2026 from $5.2 million for the six months ended June 30, 2025. As a percentage of revenue, product development expenses were 20% and 23% for the six months ended June 30, 2026 and 2025, respectively. The six months ended June 30, 2026 includes reorganization charges of $0.3 million related to severance. Inclusive of the $0.3 million of reorganization charges the decrease was primarily attributable to $0.8 million in lower personnel and outside labor costs due the reorganization and realignment of our personnel that occurred in 2025 and 2026. General and Administrative. General and administrative expenses increased $0.2 million, or 8%, to $2.7 million for the three months ended June 30, 2026 from $2.5 million for the three months ended June 30, 2025. As a percentage of revenue, general and administrative expenses were 25% and 21% for the three months ended June 30, 2026 and 2025, respectively. The change from prior year was primarily attributable to nonrecurring professional service charges related to the acquisition of Archenia of $0.8 million which were offset by a decrease in personnel costs of $0.4 million and share-based compensation of $0.1 million, largely due to reorganization charges that occurred in 2025 and reduced the payroll cost run-rate entering 2026. General and administrative expenses decreased $0.8 million, or 14%, to $4.8 million for the six months ended June 30, 2026 from $5.6 million for the six months ended June 30, 2025. As a percentage of revenue, general and administrative expenses were 22% and 24% for the six months ended June 30, 2026 and 2025, respectively. The change from prior year was primarily attributable to a decrease in personnel costs of $1.3 million and share-based compensation of $0.3 million, largely due to reorganization charges that occurred in 2025 and reduced the payroll cost run-rate entering 2026, partially offset by nonrecurring professional service charges related to the acquisition of Archenia of $0.8 million. Income Tax. Income tax expense was $0.1 million and $5.0 thousand for the three months ended June 30, 2026 and 2025, respectively. Income tax expense was $0.3 million and $0.1 million for the six months ended June 30, 2026 and 2025, respectively. The income tax expense consists primarily of deferred tax expense and U.S. state income taxes. The effective tax rate differed from the expected tax rate of 21% in both years primarily due to the valuation allowance and, non-deductible stock-based compensation related to incentive stock options recorded under the fair-value method, and other non-deductible amounts. At both June 30, 2026 and December 31, 2025, based on all the available evidence, both positive and negative, we determined that it is more likely than not that our deferred tax assets will not be realized and accordingly recorded a full valuation allowance. Liquidity and Capital Resources As of June 30, 2026 and December 31, 2025, the Company had cash and cash equivalents of $8.2 million and $9.9 million, respectively. As of June 30, 2026, the Company had current and non-current contractual obligations of $1.7 million, of which $0.5 million is for payments due under our facility operating lease. Cash used in operating activities was $1.2 million during the six months ended June 30, 2026. The cash used in operating activities was primarily a result of a net loss of $2.1 million, adjusted for an increase in cash due to non-cash items of $2.7 million, which primarily included depreciation, amortization, and stock-based compensation, partially offset by a decrease in cash due to changes in working capital of $1.8 million. The change in working capital was driven primarily by a decrease in accrued benefits and payroll, other accrued expenses, and other liabilities. Cash used in operating activities was $1.8 million for the six months ended June 30, 2025. The cash used in operating activities was primarily a result of a net loss of $1.9 million adjusted for an increase in cash due to non-cash items of $2.2 million, which primarily included depreciation, amortization, losses on disposals, stock-based compensation, and gain on a domain asset sale, offset by a decrease in cash due to changes in working capital of $2.1 million, which primarily included a decrease in accrued benefits and payroll, other accrued expenses, and other liabilities and an increase in prepaid expenses, other current assets, and other assets, all partially offset by an increase in accounts payable. 20 Table of Contents Cash used in investing activities for the six months ended June 30, 2026 and 2025, was $0.7 million and $0.5 million, respectively. During the six months ended June 30, 2026 the cash used in investing activities was primarily attributable to software development costs for new products in development, partially offset by proceeds from the prior year domain asset sale. During the six months ended June 30, 2025, the cash used in investing activities was also primarily attributable to software development costs for new products in development, partially offset by proceeds from the domain asset sale. Cash from financing activities for the six months ended June 30, 2026 and 2025 was $0.1 million and $0.1 million, respectively. During the six months ended June 30, 2026, the cash from financing activities was attributable to cash received from the exercise of stock options. During the six months ended June 30, 2025, the cash from financing activities was primarily attributable to cash received from the exercise of stock options, partially offset by payments made for equipment financing lease obligations. Based on our operating plans we believe that our resources will be sufficient to fund our operations, including any investments in strategic initiatives, for at least twelve months, however macroeconomic factors could influence our operating plans and resources significantly. Additional equity and debt financing may be needed to support our acquisition strategy, long-term obligations, and other Company’s needs. There can be no assurance that, if we needed additional funds, financing arrangements would be available in amounts or on terms acceptable to us, if at all. Failure to generate sufficient revenue or raise additional capital could have a material adverse effect on our ability to continue as a going concern and to achieve our intended business objectives. Critical Accounting Policies Our Consolidated Financial Statements have been prepared in conformity with U.S. GAAP. Our critical accounting policies are those that we believe have the most significant impact to reported amounts of assets, liabilities, revenue and expenses, and the related disclosures of contingent assets and liabilities that require the most difficult, subjective, or complex judgments. In the ordinary course of business, we make a number of estimates and assumptions relating to the reporting of our results. We base our estimates on historical experience and on various assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. There have been no significant changes in our critical accounting policies and estimates during the three and six months ended June 30, 2026, as compared to those disclosed in Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Form 10-K for the year ended December 31, 2025, filed with the SEC on March 26, 2026. Recent Accounting Pronouncements Not Yet Effective For discussion regarding recent accounting pronouncements not yet effective, see Note 1: Description of Business and Basis of Presentation of the Notes to our Consolidated Financial Statements. Website Our website, www.marchex.com, provides access, without charge, to our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments to those reports as soon as reasonably practicable after such materials are electronically filed with the SEC. To view these filings, please go to our website and under the "Company" tab click on “Investor Relations” and then click on “Financial Information.” Investors and others should note that we announce material financial information to our investors using our investor relations website, press releases, SEC filings, public conference calls, and webcasts. We also use the following 21 Table of Contents social media channels as a means of disclosing information about us, our services, and other matters, and for complying with our disclosure obligations under Regulation Fair Disclosure: •Marchex X Account (www.x.com/marchex) •Marchex Company Blog (www.marchex.com/blog/) •Marchex LinkedIn Account (www.linkedin.com/company/marchex) The information we post through these social media channels may be deemed material. Accordingly, investors should monitor the above accounts and blog, in addition to following our investor relations website, press releases, SEC filings, and public conference calls and webcasts. This list may be updated from time to time. The information we post through these channels is not a part of this Form 10-Q.