Surgepays (SURG) Q4 2024 earnings summary

Executive summary

• Investments since 2021 and completed AT&T integration have positioned the company for significant revenue acceleration and a clear path to sustainable, positive cash flow within 12 months.

• Over $250 million in revenue was generated from the Affordable Connectivity Program (ACP) between August 2021 and April 2024, with 285,000+ wireless subscribers and a retail network of nearly 9,000 stores.

• The company is now more efficient and diversified, focusing on underserved communities through wireless and POS software segments, with strategic investments in POS and MVNE platforms.

• Multi-year agreement with AT&T enables nationwide 4G/5G coverage, with integration completed and full launch on April 1.

• Projected revenue to exceed $200 million over the next 12 months, with positive operating cash flow expected before end of 2025.

Financial highlights

• 2024 revenue was $60.9 million, down 56% from $137.1 million in 2023, mainly due to the ACP shutdown in June 2024.

• Net loss for 2024 was $45.7 million, or $2.39 per share, compared to net income of $20.6 million in 2023.

• Gross loss of $14.3 million in 2024 versus $35.6 million gross profit in 2023, reflecting the ACP wind-down and strategic transition costs.

• Cash, cash equivalents, and investments totaled $12.8 million at year-end 2024, down from $14.6 million at end of 2023.

• Cash used in operations was $21.3 million in 2024, compared to $10.3 million generated in 2023.

Outlook and guidance

• Revenue for the next 12 months is projected to exceed $200 million, driven by LinkUp Mobile and MVNE partnerships.

• Q1 2025 revenue expected to be similar to Q4 2024, with a significant ramp starting in Q2.

• Anticipates exiting 2025 cash flow positive and entering 2026 with momentum.