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01/10 16:02
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call presents a mixed picture: strong revenue growth and improved operational performance are offset by declining gross margins and sector volatility. The Q&A reveals optimism but lacks concrete data, and the software transition introduces short-term challenges. The unchanged revenue guidance suggests stability, but market risks and margin pressures temper enthusiasm. With no market cap provided, a neutral prediction (-2% to 2%) is prudent, balancing positive growth with potential risks.
BOHA! Terminals Sold 1,942 units sold in Q2 2025, a 32% increase year-over-year. This growth reflects progress in the food service technology (FST) sector and effective go-to-market initiatives.
Total FST Revenue $4.8 million in Q2 2025, up 14% year-over-year. Growth driven by higher hardware sales and increasing recurring revenue.
Recurring FST Revenue $3 million in Q2 2025, showing solid gains both sequentially and year-over-year. Growth attributed to improved sales processes and operational efficiency.
Average Revenue Per Unit (ARPU) $792 in Q2 2025, up 10% year-over-year. Increase due to disciplined sales processes and operational improvements.
Casino and Gaming Revenue $7.6 million in Q2 2025, up 42% year-over-year and 14% sequentially. Growth driven by improved market demand, resolution of prior inventory oversupply, and new OEM wins in non-casino charitable gaming applications.
Total Net Sales $13.8 million in Q2 2025, up 19% year-over-year and 6% sequentially. Growth attributed to strong performance in FST and casino and gaming sectors.
Gross Margin 48.2% in Q2 2025, down from 52.7% in the prior year period. Decline due to higher mix of FST hardware sales, increased overhead costs, and competitive pricing pressures.
Operating Loss $258,000 in Q2 2025, improved from a loss of $438,000 in the prior year period. Improvement due to better sales performance and cost management.
Net Loss $143,000 in Q2 2025, improved from a loss of $319,000 in the prior year period. Improvement driven by increased revenue and operational efficiencies.
Adjusted EBITDA $478,000 in Q2 2025, up from $89,000 in the prior year period. Increase reflects improved operational performance and revenue growth.
BOHA! Terminal Sales: Sold 1,942 BOHA! Terminals in Q2, a 32% increase year-over-year, totaling 4,292 units in the first 6 months of 2025.
BOHA! Software Source Code Acquisition: Acquired a perpetual license for the BOHA! software source code for $2.55 million plus $1 million in professional services fees. This move eliminates royalty fees, provides full control over the software, and allows sublicensing opportunities.
FST Revenue: Total FST revenue rose to $4.8 million, up 14% year-over-year, with recurring revenue climbing to $3 million.
Casino and Gaming Revenue: Revenue reached $7.6 million, up 42% year-over-year and 14% sequentially, driven by improved market demand and new OEM wins in charitable gaming applications.
Epic TR80 Printer: Gaining traction in sports betting kiosks and video lottery terminals, with expected sales ramp-up in the second half of 2025.
Operational Efficiency: Achieved second consecutive quarter of positive adjusted EBITDA, reflecting improved processes and cost discipline.
Tariff Management: Implemented a small tariff surcharge and plans for further pricing actions to offset increased tariff costs.
Strategic Shift in Software Management: Transitioning BOHA! software to in-house hosting by 2027, enabling direct control and potential sublicensing opportunities.
Land and Expand Strategy: Focused on initial smaller deals with clients, followed by expansions, which has proven effective in driving growth.
Tariff Costs and Pricing Actions: The company is facing increased tariff costs on imports, which has led to the implementation of a small tariff surcharge. Further tariff modifications are expected to increase costs, necessitating additional pricing actions with customers. This situation is fluid and could impact customer relationships and margins.
BOHA! Software Transition: The acquisition of the BOHA! software source code involves significant upfront costs ($3.55 million) and additional expenses for in-housing and hosting. While this move is expected to provide long-term benefits, it introduces short-term financial strain and operational challenges during the transition period.
Casino and Gaming Market Volatility: The casino and gaming industry is experiencing economic fluctuations, described as 'bumpy,' which could impact demand stability. Although the company sees no mid- to long-term concerns, short-term unpredictability remains a risk.
POS Automation Sales Decline: Sales in the POS automation segment have declined by 49% year-over-year, stabilizing at lower levels. This indicates a potential long-term decline in this market segment, which could affect overall revenue diversification.
Gross Margin Pressure: Gross margins have decreased due to a higher mix of lower-margin FST hardware sales, increased overhead costs, inflation, and competitive pricing pressures. This could impact profitability if not managed effectively.
Supply Chain and Inventory Risks: The company has resolved prior inventory oversupply issues with OEM partners, but any future disruptions in supply or demand could negatively impact operations and financial performance.
Revenue Guidance for 2025: The company has raised its full-year revenue guidance to between $49 million and $53 million, reflecting confidence in continued FST expansion and casino stability.
Adjusted EBITDA Guidance for 2025: Adjusted EBITDA is now expected to range from breakeven to a positive $1.5 million, an improvement from the previous quarter's guidance, assuming no major disruptions in supply or demand.
Casino and Gaming Revenue Outlook: The company expects casino and gaming revenue to maintain a similar run rate through at least the third quarter of 2025, driven by normalized buying levels from major OEMs and new opportunities in non-casino charitable gaming applications.
BOHA! Software Transition: The company plans to fully deploy its hosted version of the BOHA! software by early 2027, which is expected to provide cost savings from eliminated royalty fees and incremental revenue opportunities through sublicensing.
Epic TR80 Printer Sales: Sales of the Epic TR80 printer are expected to ramp up in the second half of 2025 and become a larger contributor to the casino and gaming market over time.
Gross Margin Outlook: Gross margins are expected to remain in the mid- to high-40% range for the remainder of 2025.
Tariff Impact and Pricing Adjustments: The company plans to implement a second pricing action to offset increased tariff costs on imports, which is expected to impact financials in the coming quarters.
The selected topic was not discussed during the call.
The earnings report shows mixed signals: strong year-over-year growth in certain sectors like casino gaming and recurring revenue, but significant challenges in POS automation and new customer acquisition. The raised revenue guidance and improved financials are offset by competitive pressures and cost headwinds. The Q&A section highlights uncertainties in the casino gaming market and regulatory developments. Overall, these factors balance each other out, leading to a neutral stock price prediction over the next two weeks.
The earnings call summary shows strong revenue growth and positive product development, particularly with record BOHA! Terminal sales and customer upgrades. The Q&A section suggests positive sentiment from analysts, with management expressing confidence in growth and strategy execution. Despite some uncertainties in guidance, the overall financial health and market strategy appear solid. Considering the strong revenue growth and positive business updates, the stock is likely to see a positive movement in the short term.
The earnings call presents a mixed picture: strong revenue growth and improved operational performance are offset by declining gross margins and sector volatility. The Q&A reveals optimism but lacks concrete data, and the software transition introduces short-term challenges. The unchanged revenue guidance suggests stability, but market risks and margin pressures temper enthusiasm. With no market cap provided, a neutral prediction (-2% to 2%) is prudent, balancing positive growth with potential risks.
The earnings call presents a mixed sentiment. Financial performance shows improvement, with increased net sales and reduced operating expenses, but gross margins have declined. The suspension of the strategic review and macroeconomic uncertainties weigh negatively. The Q&A highlights positive pipeline conversion and opportunities in new markets, yet lacks clarity on revenue guidance specifics. Considering these factors, along with the absence of new partnerships or significant shareholder return announcements, the stock price is likely to remain stable, leading to a neutral prediction.
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