Transact Technologies ((TACT)) has held its Q2 earnings call. Read on for the main highlights of the call.
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TransAct Technologies recently held its earnings call for the second quarter of 2025, revealing a generally positive sentiment with notable achievements and strategic initiatives. The company reported significant growth in BOHA! Terminal sales and casino revenue, alongside a strategic acquisition aimed at long-term benefits. However, challenges were noted in declining gross margins and lower sales in certain segments.
BOHA! Terminal Sales Growth
TransAct Technologies reported a remarkable 32% year-over-year increase in BOHA! Terminal sales, selling 1,942 units in Q2 and totaling 4,292 units in the first half of the year. This growth underscores the strong demand for their innovative solutions in the market.
FST Revenue Increase
The company’s Food Service Technology (FST) revenue saw a 14% year-over-year rise, reaching $4.8 million. This increase was driven by higher hardware sales and a growing stream of recurring revenue, highlighting the success of their strategic focus on this segment.
Casino and Gaming Revenue Surge
Casino and gaming revenue surged to $7.6 million, marking a 42% year-over-year increase and a 14% sequential rise. This growth was attributed to improved market demand and new OEM sales, reflecting the company’s strong positioning in this sector.
Positive Adjusted EBITDA
TransAct Technologies recorded a positive adjusted EBITDA of $478,000, a significant improvement from $89,000 in the prior year period. This achievement demonstrates the company’s effective cost management and operational efficiency.
License Acquisition for BOHA! Software
The acquisition of a perpetual license for the BOHA! software source code for $3.55 million is expected to unlock significant value and generate incremental revenue. This strategic move provides TransAct with more control and potential sublicensing benefits.
Raised Full-Year Guidance
TransAct Technologies raised its full-year revenue guidance to between $49 million and $53 million, with adjusted EBITDA expected to range from breakeven to $1.5 million. This optimistic outlook reflects the company’s confidence in its growth trajectory and strategic initiatives.
Gross Margin Decline
Despite the positive growth, the company experienced a decline in gross margin, which fell to 48.2% from 52.7% in the prior year period. This was primarily due to a higher mix of lower-margin FST hardware sales and increased overhead costs.
POS Automation Sales Decline
POS automation sales experienced a significant decline of 49% year-over-year, totaling $590,000. This decrease was attributed to normalized levels for Ithaca 9000 sales, indicating a potential area for future improvement.
TSG Sales Decline
TSG sales were down 10% year-over-year to $818,000, driven by lower demand for legacy spare parts and services. This decline highlights the challenges faced in maintaining demand for older product lines.
Forward-Looking Guidance
Looking ahead, TransAct Technologies has raised its full-year 2025 revenue guidance to between $49 million and $53 million, with adjusted EBITDA expected to range from breakeven to $1.5 million. The company maintains a solid balance sheet with $18 million in cash and anticipates that the strategic acquisition of the BOHA! software will enhance long-term growth and profitability.
In summary, TransAct Technologies’ earnings call for Q2 2025 presented a positive outlook with significant growth in key areas and strategic initiatives poised to drive future success. Despite challenges in certain segments, the overall sentiment was optimistic, reflecting the company’s strong market positioning and strategic focus.