Q4 2026 U.S. Global Investors Inc Earnings Call
Speaker #2: With that in mind, I will now turn it over to our CEO and CIO, Frank Holmes, to walk us through the fiscal year and share his macro outlook for the quarter.
Speaker #2: Frank.
Speaker #3: The DNA of volatility is so important for investors to really appreciate. Volatility of asset classes is different, and it's the same thing with individual stocks within a category.
Speaker #3: The S&P is the biggest benchmark; a daily move of plus or minus 1% is a non-event, meaning 70% of the time that's what happens. And over 10 days, it's 2%.
Speaker #3: Bullion is twice that number, and you can see oil has greater volatility. And Bitcoin, on a daily basis, is pretty much the same as oil and gold, but when we start going over 10 days, Bitcoin is more volatile because it's still emerging.
Speaker #3: The Jets ETF is plus or minus 3% because oil is their biggest line item, besides all these other global issues and trade. You just get this increase in the volatility.
Speaker #3: So, it tells you and explains, basically, that you should be looking to buy these things when they go minus 3% in a day or more. That's usually a better buy.
Speaker #3: And over 10 days, if they're down 6%, that's even a less risk buy. Selling, same thing on the upside. But what's interesting is the New York Stock Exchange airline index it is greater than Jets when it takes you take a look over 10 days.
Speaker #3: But when I look at GOAU, which relates to gold, we can see that GOAU goes up or down 3% in a day as a non-event, because gold—it tracks gold 95% of the time.
Speaker #3: It's following gold, which is 2%. So, a lot of the gold traders and price discovery are actually following bullion, and then they'll look for signals—what they call them—that they would go and look at an ETF like GOAU.
Speaker #3: And you can see, over 10 days, it's really a shock—it's plus or minus 9%. But, if a big bulk of our assets are gold-related and airlines-related, you can see that it shows up in gross stock.
Speaker #3: It makes it really simple. If we're seeing jets going up over 10 days, 6%, or down 6%, and gold stocks going up or down 9%, well, it shows up in growth.
Speaker #3: So it's important to understand that relationship. And then HIVE, just to give you an idea, for Bitcoin mining and AI, it's very volatile and it trades off of what's happening with Nvidia. And because it's more of a micro cap compared to Nvidia, it has even greater volatility.
Speaker #3: Next, please. I want to thank the top institutional shareholders—Gator Capital and Capital Wealth Advisors—and Vanguard, I believe, is in there in one of their index products. But thank all those investors in their product for being invested in growth.
Speaker #3: Next, please. I own about 24% of the company and 99% of the voting control. This is in compliance with SEC rules for investment advisors.
Speaker #3: So, it's just, that's where you need to have two classes of stock. Next, please. Strategy and tactics. Strategy is really simple—it's about winning.
Speaker #3: How do you win? How does a product win in a category in the universe of all these ETFs and mutual funds, and in the financial realm?
Speaker #3: So we believe that it's important to create thematic products that are sustainable using our Smart Beta 2.0 strategy, which requires rigorous back-testing of over thousands of hours before you launch a product.
Speaker #3: In up cycles and down cycles, you have to go more than a decade, and it gives you a real confidence factor. There's no guarantee that past performance is going to give you a guarantee of future results, but it does give you a way to understand up and down cycles and how weightings and various screens you use create a thematic basket of stocks.
Speaker #3: And our mission is to make people feel financially happy and secure that their wealth is consistently growing. But it's volatile, as you can see.
Speaker #3: From previously, and that's what we try to educate investors on, and we've won many awards for our education efforts. Our strategy also, as a public company—because we believe that we are deeply undervalued—is that we buy back the stock using an algorithm on flat and down days.
Speaker #3: And we manage to preserve cash for future growth opportunities and market corrections. And we do make investments, and we make investments that are not directly—we have also in our funds, but we don't buy something that's just for us and not the funds.
Speaker #3: We always make sure we go through a compliance mechanism as a good first step. If the funds to be able to buy are not appropriate, then we would turn around and make certain investments.
Speaker #3: And the other part we found in this world, how it's changed a lot with wholesalers and the digital world, is this subscriber base and followers.
Speaker #3: We're continuously doing everything to grow that base because we hold our own webcasts, and the followers—it's important for communicating with investors. And then, to increase our exposure to the Bitcoin ecosystem, we have bought some of the ETFs that pay monthly dividends and give you the upside, but at the same time, waiting out these corrections, you're getting an attractive dividend.
Speaker #3: Next, please. And we have exposure and investments, very minor today, in HIVE, but we still have an investment in HIVE. The marketing strategy—I think it's important here—is what Steve Jobs said: you can't connect the dots looking forward.
Speaker #3: You can only connect them looking backwards, so you have to trust that the dots will somehow connect in your future by how well you look back.
Speaker #3: Next, please. So I want to give you some education on some ICI factors because we still have mutual funds and ETFs. ETFs are growing faster, but mutual funds are really still a significant portion of the overall assets. Even though ETFs are growing faster, they're still a big component.
Speaker #3: And when you look at data from the Investment Company Institute, 72 million households own mutual funds, and 52% were headed by someone aged 35 to 64.
Speaker #3: But we find our investors are more likely at the upper end of 64, but where the industry for ICI comes in is that there are many corporations. And you can see that $13.7 trillion in long-term mutual fund assets is held by defined contribution plans and IRAs, representing about 62% of household assets.
Speaker #3: So mutual funds continue to still have assets, and a lot is going into the fund flows from employer-sponsored retirement plans. Next, please.
Speaker #3: But when your market to them it's very different than ETF. So let me have an educate that difference. So ICI fact book the ETF surpassed 13 trillion in assets and what's really evolved here is that it's predominantly a smaller account that's doing it unless you get tax efficiency monthly paying specialty funds that give you a return on capital model they've had some big growth but I think that the majority is small it's much more retail and it's also institutional and what happens is that a lot of institutions will use that to go short borrow against these positions and that's a big source of revenue to low cost ETFs they make additional revenue from lending out those securities and it's we've seen this in Jets in particular that when Spirit was going bankrupt that whole end there was many institutions that were shorting Spirit but they would go long Jets to do that Paris trade and they would borrow from it.
Speaker #3: So they were making a bet against that particular airline, and so we made a lot of money for the shareholders in JETS from that securities lending.
Speaker #3: Next, please. RIAs, which is positive for us, are rotating to real assets, says Advisor Pro. And the data is a wonder. You've seen a lot of big interest—it is up 265%, basically—in the oil patch, and then especially I see in the oil patch on the refineries. They're making money hand over fist. Natural resources, because of China playing games on restricting the supply of rare metals and other minerals, there's a big spend now by the federal government to improve the supply lines. And natural resources as a whole are doing exceptionally well, and commodities are also doing well.
Speaker #3: So we can see the big interest. Next, please. But when it comes to ETFs, it's different factors than social media. Social media is the new classroom of financial education.
Speaker #3: I'm not a TikTok person, but it's amazing how many people are on there talking about Bitcoin, or gold, and government debt, and then people recommending different types of allocation models.
Speaker #3: So, it's pretty rich what's going on. I think the biggest is YouTube. I personally enjoy looking at YouTube. Reddit is really often controversial, leaned more to the left when it comes to their political opinions, which I always find really interesting to offset other opinions. And X does everything to be in the middle, but it's a big source for active investors. They are using Reddit, and so do ChatGPT, Claude, and Perplexity. Quite often when they're scanning and looking for articles and information, they will go to Reddit, besides Wikipedia and other platforms.
Speaker #3: So a lot of people are using these platforms for getting ideas. Next, please. So something on the journey—I learned about JETS years ago. Graham Stephan, he's now up to 5.2 million.
Speaker #3: That means he's making about $5 million a year. He has an earlier one several years back, four years ago, that talks about him first starting and making $4,000 with YouTube, getting paid for shared revenue. And basically, it's a million dollars for every million subscribers.
Speaker #3: So he's a real estate guy that has gone full-time in this end of the business, and Andre over in the middle here—he's always got the world coming to an end, does great geopolitical stuff, but it's a little sometimes aggressive, but he's got 3.3 million followers.
Speaker #3: That's very impressive. And then Humphrey Yang, he's got 2 million subscribers. These people do influence, because the market is how many followers they have.
Speaker #3: Next, please. So when it came to JETS, when there were big flows into it, I was still—don't you know who Sam Chu is? No? Sam Chu—who—he has 3.7 million subscribers, and he's not a pilot. But the other two here, Captain Joe and Mentor Pilot, they have millions of subscribers and talk about the airline industry, which predominantly is a lot of young millennials that are trading these products.
Speaker #3: Next, please. Now, they're not recommending ETFs, these airline people, but they just give you all these facts about what is the best business, what is the best flight, and other interesting things. And what makes it interesting is that so many people are interested in the airline industry. I do know and remember vividly in 2020, when all the analysts on Wall Street were capitulating—'get rid of all the airlines!'—and Warren Buffett blew out, in June of 2020, all of his Delta position. Now he's a player back in again. But what's interesting is that the big recommendation was coming from Reddit, saying that every time they've had a crisis, the jets fall 60% to 70%, and a year later they're up 130%, 120%. And that's what happened.
Speaker #3: So I think that what we've witnessed here is that billions of dollars come in into that type of product and it's lived that it's done basically the quant model for which you're paying only 60 basis points has outperformed the New York Stock Exchange Global Airline Index so we end up coming up with a new product called War and Defense Spending is a macro trend ever since Putin invaded Crimea but what's really important here is you can see in this visual when the Berlin Wall fell there was a lot of negotiating of streamlining and cutting back on the US military until 9/11 and you can see this very vividly that after 9/11 spending increased dramatically and we can see that recently under Ukraine invasion spend it really picked up again so people are deeply concerned and Europe and especially Eastern Europe and Trump is really also pushed to hold them all accountable for their 2% and now they're going to 5% and we're talking about 2.9 trillion so think of a big funnel of money coming rushing down going into a sector and there are certain industries are going to truly be more significant and I'm a big theory believer that it's going to be AI related and that includes data centers this one.
Speaker #3: Next, please. So, what is it we do? It's about growing the dividends and growing the cash flow. Our current stock price, the monthly yield is 2.83%, and we continue to pay this monthly. We've not increased the dividend; we've been more focused on buying back stock in the past few years. Again, a little more color on that in the next slide. The company believes the stock is deeply undervalued and therefore buys back shares when the price is flat or down, using an algorithm.
Speaker #3: Next, please. And during fiscal 2026, the company repurchased 733,840 Class A shares using $2 million in cash, and since 2020, just before COVID, we have reduced the shares outstanding by approximately 20%.
Speaker #3: Next, please. So that gives you an idea that volatility is a key factor here. If there's a big sell-off, there's more downward volatility than our buying picks up.
Speaker #3: Next, please. What's really important, I think, for investors is what Meb Faber came out with—shareholder yield. It's a better approach to yield investing. What he does is he looks at your free cash flow, your cash flow, and how much stock you're buying back, how much in dividends, and how much debt you're paying down. Overall, that's what gives you a better return on invested capital.
Speaker #3: Next, please. So, shareholder yield is dividends plus buybacks plus debt reduction, divided by market cap. Next, please. So, U.S. Global Investors is committed to returning value to shareholders when compared to Treasury yields.
Speaker #3: So you can see here that the five-year has risen, and so has the 10-year, but our overall yield, because of the stock buybacks, is 7.87%.
Speaker #3: Next, please. Growth over the longer term, we can see, is outperforming the Russell Microcap Growth Index. Next, please. So, two platforms, two investor audiences.
Speaker #3: So let's compare Schwab versus Robinhood. Schwab has $11 trillion in assets. Robinhood has $367 billion. In terms of accounts and customers, Charles has almost 30.9 million, or 30.5 million, active brokerage accounts.
Speaker #3: Whereas Robinhood has 27.5. But the average assets per account or customer is $309,000, versus Robinhood, which is $13,000. So Robinhood really caters to price discovery and the younger investor, but you need price discovery to bring in institutions. Charles Schwab is predominantly RIA asset allocators.
Speaker #3: Next, please. So this is a comp to give you an idea where we fit in—roughly in the middle—on price to EBITDA and shareholder yield. You can see these differences.
Speaker #3: Next, please. Average assets were incrementally increasing, and they had a great pop last month. Now, they seem to have sold off.
Speaker #3: It's very, very volatile overall. Next, please. Net income—the big bump in assets—we've done better. Next, please. One of the real key people for institutions is Ray Dalio—he says that a well-diversified portfolio should be 5 to 15% in gold and Bitcoin.
Speaker #3: And I think it's just important to recommend that people read his book. You can get his on LinkedIn, his following, and all of the work he's done.
Speaker #3: And it's quite significant as an educator. Next, please. So, what makes gold so attractive? Well, a big part is modern monetary theory. It's basically that rising real debt has real consequences.
Speaker #3: And the future doesn't wait. It's always trying to figure out what it's going to be. And we're at $350 trillion—that's last year. So I think it could be even higher.
Speaker #3: Next, please. Central banks. So now we have modern monetary theories being practiced by the G20 countries. Whenever there's a problem, just print more money.
Speaker #3: And we're seeing now, witnessing a big push that a lot of debt funding is to rearm these countries, with the interesting dilemma that most of these countries have huge GDP debt levels. And the money now is not going so much for social welfare—it's going more for military spending.
Speaker #3: And we have a big push by China, trying to recommend America to get out of U.S. stocks and buy gold—buy something that has long-term assets.
Speaker #3: So it's interesting to see that debate. But this visual here is to show you that during COVID, it was the only drop in China slowing down buying gold, but then they had a big surge to 108, as you can see.
Speaker #3: Next, please. That means tons of gold being bought. I mean, it's really remarkable to see how much gold China buys. But if China wants to get caught up with America, I think they have to buy 100% of all the mines' production for the next seven or eight years.
Speaker #3: This is China's official gold reserves. Since he became dictator for life, you can see a big pop. Next, please. The quantum mental approach to smart beta 2.0.
Speaker #3: We use a quantum mental approach, which is basically quants and fundamentals to investing, requiring a broad and deep understanding of global economic trends, policies, and geopolitical events. Our Smart Beta 2.0 investment strategy integrates advanced analytics with data-driven decisions, and I think momentum and revenue cash flow are also important factors.
Speaker #3: Next, please. Gains seen across the thematic lineup. When Trump came out with his 'Freedom'—it was on April 2nd. It's interesting, because everything sold off—I think $5 trillion around the world—and then it came back, and SEA has outperformed the S&P 500 by a wide, wide, wide margin.
Speaker #3: And it's the best barometer that I know for the arteries and veins of the world. So that continues to be an important product, along with WAR.
Speaker #3: But war is much more volatile. Here are some of the companies we own. There's CEC ETF. You can see as it climbs higher, especially this summer.
Speaker #3: And you can see Jets also. Next, please. This, to me, is one of my favorites because you can see how JETS has far outperformed the S&P Aerospace and Defense Select Industry.
Speaker #3: And the S&P 500. So, money being raised, deficit spending, triggering people buying gold and triggering people buying anything that has to do with rebuilding NATO with AI.
Speaker #3: Next, please. Now I'm going to turn it over to Lisa Callicotte, our CFO.
Speaker #2: Good morning. First, I'll start with the next slide, which is our financial highlights. For fiscal year 2026, our average assets under management were $1.53 billion.
Speaker #2: For the year, our operating revenues were $10.3 million, and we had net income of $3.1 million, or $0.24 per share.
Speaker #2: This slide kind of breaks down our earnings. It shows that we have operational earnings, which is related to our advisory services, but we also have investment earnings, which includes both realized and unrealized gains and losses on our investments.
Speaker #2: Both of these combined are our total earnings, but they're also both based on market fluctuations. The next slides will give us a little bit more detail into our operations for the year ending June 30, 2026.
Speaker #2: First, we see that our operating revenues were $10.3 million for the year, and this is an increase of $1.8 million, or 21%, from the $8.5 million of revenue in the prior year.
Speaker #2: The increase was primarily due to increases in assets under management, especially in our gold and natural resource funds. Operating expenses for the quarter were $10.9 million, or 5% lower than the prior year.
Speaker #2: On the next slide, we see operating loss for fiscal year ended June 30, 2026, was $603,000, or a favorable change of $2.4 million compared to fiscal year 2025.
Speaker #2: Other income for the year ending June 30, 2026, was $4.5 million compared to $2.7 million in the prior year, an increase of approximately $1.8 million.
Speaker #2: Mainly due to higher unrealized gains in investments. Net income after taxes was $3.1 million, or $0.24 per share, which was a favorable change of $3.4 million compared to the loss of $334,000, or $0.03 per share, in fiscal year 2025.
Speaker #2: Moving on to the balance sheet, the next couple of slides show that we have a strong balance sheet. It includes high levels of cash, and on the next one, you can also see more of our investments.
Speaker #2: On the following page, you see our liabilities, and these are consistent with the prior year. And then on the next slide, you see our stockholders' equity. We have a net book value of $45.1 million, net working capital of $35.7 million, and a current ratio of 19.7 to 1.
Speaker #2: With that, I will hand it over to Holly to discuss marketing and distribution.
Speaker #1: Thank you, Lisa. All right, on the first slide in my section, I want to quickly highlight a webcast that we recently hosted in collaboration with the team at The Wealth Advisor, focused on the Trillion Dollar Defense Opportunity.
Speaker #1: Frank Holmes was joined by retired Lieutenant General John Evans to discuss how the defense landscape extends far beyond traditional military hardware and why capital is increasingly flowing into AI, cybersecurity, and autonomous systems.
Speaker #1: If you didn't get a chance to tune in, we'd be happy to send you the presentation. Just shoot us an email at info@usfunds.com. On the next slide, I want to highlight a brand new podcast that U.S. Global has launched called Return on Ideas.
Speaker #1: We will be focusing on the people, the innovations, and the ideas that are shaping the world we live in. The very first episode went out just this week, and you can expect to see new episodes every other week.
Speaker #1: Be sure to check it out on the U.S. Global YouTube channel or wherever you get your podcasts. Moving on, this slide shows some of our new interactive research pieces that, if you have not checked out yet, I highly recommend that you do.
Speaker #1: The first is part of a new infographic series we're launching that examines the power challenges behind AI. The other two are interactive reports that explore what's driving the price of gold, as well as what's driving oil and natural gas prices and shaping the global energy landscape.
Speaker #1: You can find all of these on the Resources tab on our website. On the next slide, I want to highlight our continued investment in delivering timely, original market insights across digital platforms, including YouTube and TikTok.
Speaker #1: These channels allow us to communicate directly with both current and prospective shareholders, and provide greater visibility into our views on the markets and the broader investment landscape.
Speaker #1: If you haven't already, I encourage you to visit our YouTube channel and subscribe to stay informed on our latest content. All right, on the next slide, we always like to look back at the most-read Frank Talk blog post from the recent quarter.
Speaker #1: As you can see here, the top theme centered around AI, defense, and the rise in oil prices. We publish one to two posts each week covering a range of market and industry topics that align with the sectors and themes we invest in.
Speaker #1: If you're already a subscriber and find the content valuable, we encourage you to share it with friends or professional contacts who may be interested in it as well.
Speaker #1: Subscription is completely free. Finally, on my last slide, I do encourage all of you to follow us on social media—on Twitter, LinkedIn, YouTube, Instagram, and Facebook.
Speaker #1: So, wherever you prefer to get your news, be sure to check us out. This way, you're up to date with what's going on with GROW, our funds, and our broader market insights.
Speaker #1: All right. As a reminder to our audience, if you have any questions today, please email those to info@usfunds.com, and we will gladly follow up with you to clarify anything for which you may need more information.
Speaker #1: Thank you so much for tuning in today. That concludes our webcast summarizing the 2026 fiscal year.
