Usio (USIO) Q1 2025 earnings summary

Executive summary

• Achieved record first quarter revenues of $22.0 million, up 5% year-over-year, driven by strong ACH and complementary services growth, while prepaid card revenues declined as COVID incentive programs wound down.

• Total payment dollars processed rose 34% to $2.0 billion, with payment transactions up 41% to 13.7 million compared to Q1 2024.

• Adjusted EBITDA was $0.7 million (3.0% margin), up sequentially from $0.5 million in Q4 2024 but down from $0.8 million (3.8% margin) in Q1 2024, mainly due to lower interest revenues and slightly higher SG&A expenses.

• Net loss narrowed to $0.2 million, or ($0.01) per share, from $0.3 million loss a year ago, reflecting higher revenues and lower stock-based compensation and depreciation expenses.

• Launched the Usio One initiative to drive cross-selling and integrated solutions across business units, with early wins and expected acceleration in the second half of the year.

Financial highlights

• Revenue: $22.0 million, up 5% year-over-year; organic growth over 10% when adjusting for prior year one-time COVID-related revenue.

• Gross profit was $4.8 million, down 1% year-over-year, with gross margin dropping to 21.9% from 23.1% due to lower interest revenues and revenue mix.

• SG&A expenses remained flat at $4.1 million, reflecting workforce efficiencies and equipment enhancements.

• Operating cash flow improved to $1.4 million, up from $0.1 million in Q1 2024, mainly due to lower accounts receivable.

• Cash balance increased to $8.7 million at quarter end.

Outlook and guidance

• Reiterated full-year revenue growth guidance of 14%-16%, with acceleration expected in the second half as Usio One ramps and COVID-related comps fade.

• Management expects SG&A to remain relatively flat year-over-year due to continued expense management and operational efficiencies.

• Company believes it is well-positioned for long-term shareholder value creation and has sufficient financial resources for anticipated growth.

• Available cash and credit facilities are expected to be sufficient to support working capital, capital expenditures, and debt service obligations for at least the next 12 months.