Arizona Tribune - ONAR Holding Corporation Provides Letter to Shareholders Following Reporting of First Quarter 2025 Financial Results

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Dear Fellow Shareholders,

Following our recent reporting of our Q1 financial results, I'm writing to you with a strong sense of optimism about the trajectory of ONAR Holding Corporation. We have accomplished much in 2025 that establishes a broad and robust foundation upon which we continue to build meaningful value. As we continue to navigate the intricacies of transformation and strategic growth, the underlying fundamentals of our business show clear momentum - positioning us for long-term success.

Strategic Transformation Driving Results

Our strategic acquisition of HLDCO and its subsidiary Integrum Group has fundamentally transformed ONAR into a focused marketing services powerhouse. Following the acquisition, we've streamlined our corporate structure. Specifically, HLDCO has been dissolved, and Integrum Group has been rebranded as ONAR LLC, which now serves as our marketing services platform that houses Storia and Of Kos. It is worth underscoring that this acquisition was accomplished to position ONAR at the center of the technology-enabled marketing revolution where we believe the greatest opportunities for growth and margin expansion exist.

Further, we believe our financial results speak to our strong progress. Revenue growth in Q1 of 79% year-over-year to $1.07 million demonstrates the immediate impact of our expanded capabilities. This growth reflects our successful integration and focus on our core specialized marketing agencies: Storia (AI-enabled digital performance marketing) and Of Kos (our rebranded healthcare marketing agency, formerly VMED). Each serves distinct, high-value market segments. We've also strategically streamlined our operations by sunsetting our experiential marketing business to concentrate resources on our highest-impact capabilities.

Core Focus on High-Growth Marketing Services

What excites me most about our current position is our strategic focus on the high-growth marketing services sector. Our core Advertising & Marketing segment generated $735K in Q1, revenue which is 90% recurring revenue, positioning us squarely in the rapidly expanding digital advertising space where scalability and recurring revenue potential create substantial value.

While we maintain some non-core services that contribute to our revenue base, our operational and investment priorities are concentrated entirely on our marketing capabilities and technology development. This emphasis on our core competencies allows us to maximize returns on invested capital while building market-leading positions in our chosen verticals.

Building for Scale and Efficiency

Our current operational metrics reveal a company building marketing services excellence. The 79% revenue growth significantly outpaced our cost of revenue increase, indicating early signs of operational leverage in our core marketing business.

It's important to address our current cash consumption directly. While our core marketing businesses are profitable on a standalone basis, we're absorbing the substantial costs of operating as a public company, including compliance, reporting, and governance expenses, which are largely fixed regardless of scale. This is precisely why achieving scale through our pending acquisitions is not just strategic, but essential.

The path forward is clear: as we integrate our acquired capabilities and close the additional acquisitions currently in our pipeline, we will achieve the scale necessary to absorb these public company costs while maintaining strong unit economics. Our marketing platform, when operating at the scale we're building toward, should not only cover these overhead expenses but also should generate margin expansion beyond them.

Market Position and Competitive Advantages

ONAR occupies a unique position in the marketing services landscape. Unlike traditional agencies that compete primarily on price, we've built a technology-enabled platform that delivers measurable results through specialty areas. Our acquisition strategy allows us to capitalize on market fragmentation while offering smaller agencies the resources, capital, and growth opportunities they need to thrive.

In healthcare marketing through Of Kos, we serve a sector with sustained demand and regulatory complexity that creates natural barriers to entry. Our digital performance marketing capabilities through Storia leverage AI and machine learning-technologies that are becoming table stakes in modern marketing but require significant investment to implement effectively. With the proliferation of new ad platforms, the ability for midsize companies to be able to manage this ever expanding complex landscape is becoming more and more challenging, and our positioning and platform solves for that. By focusing on these core competencies and divesting non-core operations, we've created a more streamlined and profitable operating model.

Capital Structure Optimization

We've also been actively optimizing our capital structure to support growth while maintaining flexibility. Our recent Series E Preferred Stock offering, which could raise up to $6 million, provides us with growth capital while maintaining our ability to pursue strategic opportunities. Additionally, our convertible note structures offer optionality for both the company and our investors as we scale. We've seen optimism in note holders from our financing to go public to begin to convert their notes into common stock demonstrating their belief in the long term value we are created, while also improving our overall balance sheet.

Looking Forward: Clear Path to Value Creation

The marketing services industry is undergoing fundamental changes driven by AI, data analytics, and the increasing complexity of digital channels. Companies that can navigate this complexity while delivering measurable ROI will command premium valuations. ONAR is positioned to be one of those companies.

Our near-term priorities are straightforward: execute on closing our pending acquisitions to achieve the scale required for platform profitability, continue integrating our core marketing capabilities, and optimize our service delivery processes. These aren't just growth moves-they're critical steps to transforming our profitable core businesses into a sustainably profitable public platform. We're building a more focused, higher-margin marketing services leader with the scale to thrive as a public company.

Commitment to Shareholders

We remain firmly committed to creating sustainable long-term value. This means making the right investments even when they pressure near-term metrics, maintaining high standards for capital allocation, and being transparent about both our opportunities and challenges.

The transformation we've undertaken positions ONAR at an inflection point. The revenue growth, marketing capabilities, and market opportunities we've created provide multiple pathways to value creation. While we continue to navigate the complexities of growth and integration, I'm confident that our strategic foundation will deliver the returns our shareholders deserve.

Thank you for your continued support and confidence in our team's ability to execute on this vision.

Sincerely,

Claude Zdanow
Chief Executive Officer
ONAR Holding Corporation

About ONAR

ONAR (OTCQB: ONAR) is a leading marketing technology company and marketing agency network. The Company's mission is to power unparalleled marketing services that drive revenue growth through an integrated, AI-driven approach. Committed to honor, candor, and best-in-class results, ONAR's agency network offers a range of digital marketing services including performance marketing & healthcare marketing. ONAR's agencies focus on servicing middle-market and growth stage companies, and the Company is actively searching for agencies to acquire and become part of the network. Additionally, the Company's technology incubator, ONAR Labs, is focused on identifying, developing, and commercializing innovative marketing technology solutions. For more information, visit www.onar.com.

Forward-Looking Statements

This press release 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. These forward-looking statements are based on ONAR's current expectations and projections about future events and financial trends that it believes may affect its financial condition, results of operations, business strategy, and financial needs. These statements are not historical facts and are inherently uncertain and outside of ONAR's control. Forward-looking statements include, among other things, statements regarding ONAR's expectations regarding its ability to achieve its financial and strategic goals, including surpassing $100 million in revenue and securing a NASDAQ listing; its ability to expand its client base and market share; and its ability to develop and launch new products and services. Actual results may differ materially from ONAR's expectations and projections due to various risks and uncertainties, including market conditions, competition, the ability to protect intellectual property, the ability to manage growth, changes in laws and regulations, and other factors described in ONAR's filings with the Securities and Exchange Commission. These forward-looking statements are made as of the date of this press release, and ONAR undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law.

Media Contact:
Sara Scully
Marketing Manager
ONAR
213-437-3081
[email protected]

SOURCE: Onar Holding Corporation

View the original press release on ACCESS Newswire

J.Gomez--AT