There was an audio gap. As you can see on Slide #2, the presenters for today's program are Frank Holmes, U.S. Global Investors' CEO and Chief Investment Officer; Lisa Callicotte, Chief Financial Officer; and myself, Holly Schoenfeldt, Director of Marketing. Moving on to the next slide. During this webcast, we may make forward-looking statements about our relative business outlook. Any forward-looking statements and all other statements made during this webcast that don't pertain to historical facts are subject to risks and uncertainties that may materially affect actual results. Please refer to our press release and corresponding Form 10-Q filing for more detail on factors that could cause actual results to differ materially from any described today in forward-looking statements. Any such statements are made as of today, and U.S. Global Investors accepts no obligation to update them in the future.
On Slide #4, we're always grateful for our continued support of our valued shareholders. So if you'd like to receive one of our signature U.S. Global hats featured here, just send us your mailing address to info@usfunds.com, and we will gladly ship one out to you. All right. Moving on to the next slide, I will briefly review the company. U.S. Global Investors is an innovative investment manager with vast experience in global markets and specialized sectors. We use a quantamental strategy to create thematic Smart Beta 2.0 products. The company was originally founded as an investment club, becoming a registered investment adviser in 1968 and has a long-standing history of global investing and launching first-of-their-kind investment products. Finally, we are experts in thematic investing, in particular, gold and precious metals, natural resources, airlines and luxury goods, all using a quantamental approach that includes both macro and micro factors.
Moving on to the next slide. We often begin our presentations with this slide, what we call the DNA of volatility. As a reminder, market swings are a normal part of long-term investing. With that in mind, I would like to hand it over to our CEO and CIO, Frank Holmes. Frank?
Thank you, Holly. As Holly points out, volatility is so important to appreciate. These numbers always change when global factors such as a stock—like we know Tesla when it went into the S&P 500—volatility dropped. Gold bullion when the ETF was created, its volatility dropped. So other events can turn around to increase volatility. It is a non-event for Bitcoin to go up 3% in a day or down 3%, and the same thing with the airline index. And the same numbers happen over, as you can see here, over 10 trading days versus gold. And gold stocks are even more volatile than gold. Next, please. I want to thank our shareholders, Gator Capital Management, seeing our deep value, owning 7.95%, and 6% by Capital Wealth Advisors and Vanguard's index. Next, please. As CEO and CIO, I own approximately 19% of the company and have approximately 99% of voting control. This is a structure that is to be in compliance with the '40 Act and rules for running money management companies.
Next, please. So strategy and tactics: create thematic products, look for a rigorous process of backtesting thousands of hours before launching a product for its resiliency in both up and down cycles. Our mission is to make people feel financially happy and secure that their wealth is consistently growing. Consistently is really an important part when we look longer term. Short term, we can see periods where gold, which is well known for this behavior, can trade sideways or be down. But over this century and over this decade, it's had phenomenal performance. And over the past five years, it's really kicked in over the past two years. So it's recognizing over longer time periods. We strategically buy back our stock using an algorithm on flat and down days and manage to preserve cash for future growth. Please, we do love when we get more subscribers for their thought processes. So feel free to subscribe.
Something that we look to increase in a very competitive marketing environment to drive down marketing costs is to develop followers. We increased our exposure to the Bitcoin ecosystem because we did launch HIVE, the first crypto mining company to go public, which is a dual engine, both data centers, Tier 1 for Bitcoin mining, but Tier 3 is now building AI factories. Next, please. So I'm going to quickly go back and overview the capital markets for you and our products and how they're aligned with them. But in that thought process, the great line from Steve Jobs: you can't connect the dots looking forward, you can only connect them looking backwards. So you have to trust the dots will somehow connect to your future. And that's really a thought process that also shows up in Smart Beta 2.0: backtesting, seeing if you can connect the dots, what are the factors for portfolio construction, as well as different themes have different key factors for stock picking.
Next, please. The trend continues. Mutual funds continue to see redemptions as ETFs continue to grow. And what's really important for us is to see that actively managed ETFs are growing. Next, please. The total U.S. ETF market remains the largest in the world. As you can see from the ICI fact book, total assets have surpassed $13 trillion. Next, please. So the rise of active ETFs: active ETFs attracted $500 billion in net inflows in '25 and more than 80% of ETF launches in '25 were active. This is a big difference from when we first launched JETS. In Q1 '26, active ETFs were attracting nearly as much money as passive ETFs. Next, please. I really point out that I think Cathie Wood has been instrumental in the creation and success when she was able to balloon to $100 billion in a technology suite of ETFs and really capture the whole boom in Bitcoin early and Elon Musk building Tesla, being an early pioneer.
Being active and transparent in her research and counsel was really influential—people can download and look at research at the same time and see how she participates through her products. So I think that was a major game changer. And in that context, the company, we believe, is deeply undervalued and we continue to buy back shares when the price is flat or down, as I mentioned earlier. This is part of the company's two-pillar strategy to enhance shareholder value by paying dividends as well as buyback amounts per year. Next, please. For the three months ended March 31, the company repurchased a total of 176,592 Class A shares using cash of approximately $534,000. And since 2019, we have shrunk the shares outstanding by approximately 20%. Next, please. Grow buybacks. This is just looking at the past four quarters: as you can see, if markets become volatile and down, we end up buying more in the down periods.
Next, please. So the key factor in this thought process is what's called total shareholder yield—that's dividends plus buybacks plus debt reduction. And since we don't have debt, it's really focused on dividends and buybacks divided by the market cap. Next, please. So on a comparative analysis, you can see that basically our monthly dividend is $0.0075. That works out to a present yield of about 3.4%. And I think if we flip over to the next visual, it's really helpful to put this in context because the dividend growth model is really comparing dividends against five-year government bond yields. And you can see that our cash dividend is slightly less than a five-year, but with the stock buybacks, that total shareholder yield is 9.96%. So this just begs the thought process of continuing to buy back the stock and makes it a very compelling investment. Next, please. Assets of $1.63 billion and operating revenue of $2.8 million quarterly.
Next, please. Average assets under management have been increasing, which is positive and constructive in the volatile markets we live with. It doesn't matter a year ago—we had, which is really, to me, interesting, the contrary is Liberation Day on April 2 and how that impacts the assets and how we've slowly climbed out of that correction and some of our products have done exceptionally well even with the negative doubts. Next, please. Quarterly EBITDA per share is basically showing you some of the volatility. Lisa will give you more granularity. And if you want more details, you can feel free to phone her, reach out and walk you through some of the swings we've experienced. But looking back at the quarter of June of last year, that included April Liberation Day, assets fell, assets rallied slowly from there. And we've also had some other GAAP reporting issues that create this sort of noncash volatility.
Next, please. We like to compare. WisdomTree is 100% ETFs. Invesco is 40%. We're 63%, and in comparing our operating revenue, price to book, we are the deepest value. That's why we keep buying back our stock. We still generate higher returns on assets. Our pretax margins remain healthy. And our dividend yield is the highest and our price to EBITDA is extremely attractive when you compare it to the overall market. Next, please. A well-diversified portfolio to 15% in gold is Ray Dalio, master of the universe of big hedge funds, the biggest to us, $136 billion, very quant disciplined, but also a big gold advocate as imbalances happen on a regular basis in the G20 countries between their monetary and fiscal policies; gold rises faster in those countries which have a bigger imbalance. Next, please. So this is sort of connecting the dots. You can see here, gold has had a spectacular run since last year in the past 12 months from under $2,000 to over $5,500.
It's corrected and now it's bouncing back. I think gold still remains very attractive for many fundamental reasons. Next, please. And then one of the most compelling is modern monetary theory. It basically is that governments this century have demonstrated a propensity to print money out of any problem and say that they will buy back that debt when the economy improves in their country, but they never do. So the debt continues to grow. There's approximately eight billion ounces of gold on the surface of the earth, but the money printing is faster than the gold is coming out of the ground or is above the ground. So that lends itself to real assets like gold becoming an attractive asset. And I think that it's just an important part of a diversified portfolio to protect your family's legacy and have a long-term exposure, in particular to gold stocks. Next, please. So one of the big factors of buying gold is not just the fear trade—negative real rates and imbalance from modern monetary policy—but the rising GDP per capita for countries like China and India, Middle East and Southeast Asia, where there's a huge cultural bias towards buying gold, especially on any corrections.
We quite often like to look at gold in rupee terms and Chinese yuan terms; you can see they're up substantially in rupee terms for India. And when you put India and China together, it's 40% of the world's population. You throw in Southeast Asia, Middle East, you're over 50% of the world's population who buy gold for love. So the correlation there is the highest: as GDP per capita rises in these countries, continuous buying this century has been demonstrated. Next, please. What's really important for me as a money manager at U.S. Global Investors is our gold equity stocks are now starting to show up as momentum stocks in the past year. This is fundamental. This happened in 2002, and it went on for five years, and gold stocks far outperformed the overall market. So this is a very positive telling sign of growth momentum in revenue and cash flow. Next, please. Gold miners' free cash flow has surged.
As you can see in this visual, even though it shows gold has corrected, the overall free cash flow of the industry continues to rise faster than the overall S&P 500. So that's another reason why many of these stocks show up at IBD. Next, please. Central banks continue to be net purchasers of gold since 2010, but we can see the real acceleration has taken place since 2020. We saw big increases in 2018 and '19, especially out of China when Xi Jinping consolidated power; China kept buying back gold and continues even this past month to show robust buying of gold to try to legitimize their currency as a global currency. Next, please. So we believe that government policies are a precursor to change. This is a classic example of what happened to silver when the U.S. government named silver a U.S. strategic mineral. In November, we saw a huge increase in the futures market by hedge funds buying silver.
It had a hyper-run to almost $20 an ounce. Then the big correction took place because of more government policies with the CME increasing margins by 64%. It has gone through the correction and now has come off that bottom. Next, please. So our approach to investing is a quantamental approach to Smart Beta, and it's well known now that we use this quantamental approach 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, diversification and risk management. Momentum and revenue and cash flow growth are very important. High free cash flow yield is also very important to generate higher cash flow returns on invested capital. What we have found is that different assets and different themes have different factors for picking stocks in that industry or category.
Further, we have found that the structure of the portfolio is very important when you do backtesting. Next, please. So building a smart thematic ETF platform: SEA, WAR, JETS, GOAU. Gold is up 300% for GOAU since we launched it. JETS has done exactly what we thought it would: outperform the New York Stock Exchange Global Airline Index. These flags show you that JETS is listed in Colombia, it's in Mexico, it's also in Peru, so is GOAU. GOAU is listed in Colombia, Mexico and Peru. Recently, SEA is listed in Peru and Mexico. These will eventually get listed all through Latin America. And I think it's important that when we look at SEA, it far outperformed the S&P this past year, even after the tariff spot on April 2, 2025, when the whole world fell by $5 trillion; then it climbed right back. The S&P last year was up about 12%, but SEA was more than double that. And WAR, which is basically AI for the rebuilding of military, has had a spectacular year.
I think it's over 12 months now; it's up over 50%. So it has done what it should have done, based on our models, and we're happy with that. JETS just continues to fly over all the negative narrative; if it falls short term with rising negative sentiment like the war in Iran, immediately you start to see the airlines—this past quarter—coming out with numbers far, far superior to global GDP and domestic GDP. So I think the airlines are at a sweet spot of being almost a leading indicator for global economic activity. SEA cargo carries 80% of all commodities and finished products, heavy big products, and it really captures the arteries and veins of world trade, whereas JETS is global travel. Next, please. Again, we've seen WAR and SEA amid international conflict sell off quickly and then go on to rise, totally contrary to what many people thought. Next, please. Military expenditures, we keep highlighting, have hit a new all-time high.
It's forecast to be 5% of GDPs in the next couple of years, which is now pushing $2.9 trillion. It's pretty easy to figure out the five industries which are going to benefit. But really, the focus for us has been AI in those industries like cybersecurity to making aircraft carriers or fighter jets. What we do see for the century since 9/11 is a rise in spending globally, and you can also really see since Xi Jinping consolidated power that America has increased its spending because China now has the largest military force in the world and maybe more military ships than the U.S. Next, please. So AI, we've mentioned many times on our webcast, is really key for cybersecurity. But for me personally, it has also been really key for health care. I do the Galleri test every year that looks for over 200 precursors—looking for proteins that are precursors to cancer—and now the MRI that can look for tumors in your body that a normal blood test may not capture.
That could be the staging for cancer. So AI is really important for health care, cybersecurity, but key here for everyone listening is military spending. In 1989 under George H. W. Bush, America went in and arrested Noriega, President of Panama, for narco dealing and other corrupt activities, but 23 American soldiers were killed. Going into Venezuela was much more tricky because they had stacked themselves with a lot of Russian and Chinese surveillance equipment, radar equipment. But what's really key here is that no Americans were killed as we captured Maduro. So the idea of using AI is quite profound when it looks at national security. Next, please. And this has been our theme for the creation of WAR. What we're showing you here is these AI data centers are linking information between a Delta Force on the ground to an aircraft carrier to a fighter jet in the sky to data from a satellite to a helicopter, bringing in and taking out Delta forces.
So the use of AI will continue to be very significant for national security in addition to health care. Next, please. And we believe we have the products that are lined up with that, recognizing the future demand accelerated with compute and graphic processing and NVIDIA chips. Here I am with Jensen, the CEO of NVIDIA, the largest market cap company in the world. It continues as our investments in HIVE build out its AI infrastructure. Next, please. So we also look at some of these alternative investments that are illiquid. They wouldn't qualify for our funds, and we participate in them so that we have our nose into what's going on in the world outside of listed public companies. We were able to participate in Investec Series; it was a $500,000 investment, and now it's looking to go public and the estimated value for our investment is up sevenfold. These things don't happen often. Sometimes there's lumps and losses in this speculation.
But we, as a company—an investment company—not only invest in our own funds, we also invest in some real estate and the creation of new companies like we launched the creation of HIVE. We also make these other special investments so that we are in the information flow of where technology is going. Next, please. Now I'm going to turn it over to hardworking Lisa Callicotte to give you more granularity on the financials for this past quarter. Lisa?
Thank you, Frank. Good morning. On the next slide, you can see that we're going to start with our financial highlights. Average assets under management were $1.63 billion for the quarter ending March 31, 2026. This is a 15% increase from the same quarter a year ago. Operating revenues were $2.8 million, an increase of approximately 31% compared to the same quarter last year, and we had quarterly net income of $2.6 million or $0.23 per share. As we move on to the next slide, this slide is a reminder of our two main components of our earnings. We have operational earnings that consist of our advisory services, and we have other earnings, which mainly consist of realized and unrealized gains and losses on our investment holdings. Both the advisory earnings and the investment gains and losses fluctuate based on market forces. On the next slide, we're going to go into more detail about our results of operations.
Here, we see that our total revenues were $2.7 million for the quarter, which is an increase of $659,000 or 31% from the $2.1 million in the same quarter last year. The increase is primarily due to higher assets under management, especially in our gold mutual funds and our Gold ETF, GOAU. Operating expenses for the current quarter were $2.7 million, a decrease of $322,000 or 11%, primarily due to decreases in employee compensation of $143,000 or 11% and a $138,000 or 57% decline in advertising expenses, which was primarily due to elevated expenses in the prior year related to the launching of our WAR ETF. On the next slide, we can see our operating income for the quarter ending March 31, 2026, is $88,000. That's compared to a loss of $893,000 for the same quarter in fiscal year 2025. Other income increased $1.1 million compared to the prior year, mainly due to net unrealized gains in equity securities of $1.3 million in the current period compared to unrealized losses of $50,000 in the same quarter in the prior year.
This was a favorable change of $1.4 million. Other income for the quarter includes a $1.9 million unrealized gain in the Investec Series investment Frank discussed earlier. In the current period, the company recognized an $844,000 tax benefit compared to a tax expense of $137,000 in the March 31, 2025 quarter. This favorable change of $981,000 was primarily driven by discrete tax items, including a federal tax adjustment related to the tax treatment of certain HIVE convertible securities and a decrease in a valuation allowance. In the December quarter, we recorded a tax expense related to the tax accounting method change, and we expected an offsetting benefit that was recorded in the March quarter. Net income after taxes for the quarter is $2.7 million or $0.23 per share, which is a favorable change of $3.1 million compared to the net loss of $382,000 or a loss of $0.03 per share for the same quarter ending fiscal year 2025.
On the next slide and the following slide, you see that we have a strong balance sheet that includes high levels of cash and securities. Moving on to the next slide, you can see our total liabilities are $2.9 million. The following slide shows our shareholders' equity. The company has net working capital of $36.2 million and a current ratio of 20.9:1. With that, I'll hand it over to Holly to talk about our marketing.
Thank you, Lisa. All right. The first slide in my section highlights several events that our marketing and investments team have recently attended as well as one that we are looking forward to in June. So in April, Frank Holmes delivered a keynote presentation at the Swiss Mining Institute Conference in Panama, where he also had the opportunity to meet one-on-one with management teams from many of the precious metals companies that we own. In May, members of our team attended the WISE Investment Summit, where Frank also spoke on the intersection of gold, defense and AI—three themes we believe are becoming increasingly interconnected. We are excited to once again represent U.S. Global at Wealth Management Edge in June, which I believe will be our third consecutive year attending. That event provides a valuable opportunity to connect with advisers and peers across the ETF industry. All right.
On the next slide, you will see our team representing U.S. Global Investors, a NASDAQ-listed company under the ticker symbol GROW, at the official NASDAQ Texas kickoff event. The gathering brought together business and economic leaders to discuss the future of innovation, growth and capital markets in Texas and the important role our state can play going forward. All right. Moving on. The next slide highlights our commitment to delivering timely and original market insights through our YouTube and TikTok channels, which are powerful platforms for engaging new and long-time shareholders. If you've not seen any of these, we encourage you to visit our YouTube page and our TikTok page and subscribe to our YouTube channel to stay up to date on the latest content. All right. Moving on to the next slide. We always like to recap the most-read Frank Talk blog posts during the recent quarter. As you can see here, the top themes really focused around commodities, particularly oil prices and gold prices, and investors are focusing on gold and oil in 2026 because both of these assets are tied to several major macro themes shaping the markets right now: inflation concerns, geopolitical instability, fiscal deficits, and so on.
If you're not a subscriber to Frank Talk, I highly recommend you do so at usfunds.com; it is completely free. Finally, on my last slide, I encourage you to follow U.S. Global Investors across social media. We are on X (formerly Twitter), LinkedIn, YouTube, Instagram, Facebook and TikTok. 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, not only with GROW and our funds, but the broader market as well. All right. As a reminder to our audience, if you have any questions today, please e-mail those to info@usfunds.com and we will gladly follow up with you to get anything clarified that you may need more information on. So thank you so much for tuning in today. This concludes our webcast summarizing the third quarter of 2026.