CoreCard Q1 2025 Earnings Call Highlights Strong Growth

Corecard Corporation ((CCRD)) has held its Q1 earnings call. Read on for the main highlights of the call.

CoreCard Corporation’s recent earnings call for Q1 2025 painted a largely positive picture, underscored by impressive financial performance. The company reported significant revenue growth and improved profitability metrics, which outweighed concerns about potential revenue losses from customer acquisition and uncertainties surrounding the Deserve and Intuit situation. Overall, the sentiment was optimistic, driven by robust financial results.

Significant Revenue Growth

CoreCard Corporation reported a total revenue of $16.7 million for Q1 2025, marking a 28% increase year-over-year. This growth was primarily fueled by higher professional services revenue, showcasing the company’s strong performance in the first quarter.

Professional Services Revenue Boost

A notable highlight was the professional services revenue, which surged to $8.7 million in Q1 2025. This increase was largely attributed to higher managed services rates from Goldman Sachs, reflecting the company’s successful partnerships and service offerings.

Improved Operating Margin

The company’s operating margin saw a significant improvement, rising to 16.8% in Q1 2025 from 4% in the same period last year. This enhancement was driven by the increased professional services revenue, indicating better operational efficiency.

Substantial Increase in Earnings Per Share

Earnings per diluted share for Q1 2025 rose to $0.24, compared to $0.05 in Q1 2024. The adjusted diluted EPS also showed a remarkable increase, reaching $0.28 compared to $0.07 in the previous year, highlighting the company’s enhanced profitability.

Positive Outlook for 2025

CoreCard Corporation remains optimistic about its growth prospects for 2025, projecting revenue growth excluding its largest customer to be between 30% and 35% for the full year. This positive outlook underscores the company’s confidence in its strategic direction and market position.

Loss of Revenue from Customer Acquisition

The termination of a contract due to a customer acquisition resulted in a one-time accelerated revenue of $500,000 in Q1 2024. This impacted the year-over-year comparison, reflecting challenges in maintaining consistent revenue streams.

Uncertainty with Deserve and Intuit

The sale of Deserve to Intuit introduces some uncertainty, as Deserve represented a small but notable portion of CoreCard’s total revenues. This situation may lead to a reduction in revenue, posing a potential challenge for the company.

No License Revenue Expected

CoreCard reported no license revenue for Q1 2025 and does not anticipate any for the year. This indicates a shift in the company’s revenue model, focusing more on service-based income.

Forward-Looking Guidance

For the full year 2025, CoreCard Corporation expects revenues between $65 million and $69 million, with EPS projected to be between $1.10 and $1.18. For Q2 2025, the company anticipates revenues between $16.2 million and $16.9 million, with EPS ranging from $0.23 to $0.28. These projections reflect the company’s strategic focus on sustaining growth and profitability.

In summary, CoreCard Corporation’s Q1 2025 earnings call highlighted a strong financial performance with significant revenue growth and improved profitability metrics. Despite challenges such as potential revenue losses from customer acquisition and uncertainties with Deserve and Intuit, the company remains optimistic about its future growth prospects. The overall sentiment was positive, driven by robust results and a promising outlook for 2025.