Direct Digital Holdings Secures $25M Series A Preferred Investment, Reverses Equity Deficit and Cuts Debt Service by $3.5M

Direct Digital Holdings, Inc. (NASDAQ:DRCT) ("Direct Digital Holdings" or the "Company"), a leading advertising and marketing technology platform operating through its companies Colossus Media, LLC ("Colossus SSP") and Orange 142, LLC ("Orange 142"), today announced the issuance of $25 million of a new series of Series A Convertible Preferred Stock, at a premium conversion price of $2.50 per share of Class A Common Stock.  The investment was made through the conversion of a portion of existing debt into the new class of perpetual convertible preferred stock. The preferred stock is redeemable in whole or in part at the Company's direction, votes on an as-converted basis with the Class A common stock, and carries a 10% cumulative annual dividend payable if, as and when declared by the Company's board of directors.

The investment results in a $25 million increase in the Company's stockholders' equity from a deficit of $24.6 million at June 30, 2025 to an estimated positive shareholders' equity of approximately $0.4 million (subject to any other period adjustments).  It further reduces the Company's ongoing debt service by more than $3.5 million and significantly reduces maturing debt obligations in December 2026.