Creative Realities (CREX) investor relations material

Executive summary

• Q2 2025 revenue was $13.0M, up 34% sequentially but flat year-over-year, with gross profit at $5M and a net loss of $1.8M, compared to a $0.6M loss in Q2 2024.

• Gross margin declined to 39% from 52% year-over-year, mainly due to a higher hardware mix and exit from media sales.

• Adjusted EBITDA rose to $1.2M from $0.5M in Q1, but was down from $1.5M last year; management expects further improvement as revenue and margin rise in H2.

• Debt was reduced by $3.1M in Q2 through operating cash flow, though outstanding debt increased to $20.1M due to contingent liability settlement.

• Hardware sales increased 41% year-over-year, offset by a 26% decline in services and other revenues.

Financial highlights

• Q2 2025 revenue: $13.0M (+34% vs Q1, flat YoY); gross profit: $5M (down YoY due to prior year media sales exit).

• Gross margin: 39% (vs 52% prior year), impacted by hardware-heavy sales mix and reduced SaaS/media sales.

• Adjusted EBITDA: $1.2M (up from $0.5M Q1, down from $1.5M prior year).

• Cash on hand: $600K; $6M available under revolving facility; net debt: $19.5M, up from $12M at start of year.

• Six months ended June 30, 2025: revenue $22.8M (down 10% YoY), net income $1.6M due to a $4.8M gain on settlement.

Outlook and guidance

• Revenue, backlog, and margins expected to accelerate in H2, with significant installations and national rollouts planned.

• Adjusted EBITDA margin targeted to return to 15% by year-end.

• Management expects to achieve breakeven as they exit the year, driven by revenue growth and operating efficiency.

• Recurring SaaS revenue growth anticipated as digital signage adoption expands, but hardware/services may fluctuate.

• Retail media network deployments in 2026 could deliver significant bottom-line leverage.