CoreCard Corp (CCRD)·Q2 2025 Earnings Summary

Executive Summary

• Q2 2025 delivered solid top-line and profitability: revenue $17.6M (+27.5% YoY), operating income $2.7M, GAAP diluted EPS $0.24, adjusted EPS $0.31, and adjusted EBITDA $4.19M with a 23.8% margin .
• The quarter was a clear beat versus Wall Street consensus: revenue $16.45M* and Primary EPS $0.23*; CoreCard reported $17.59M and adjusted EPS $0.31, respectively; GAAP diluted EPS of $0.24 sat within Q1 guidance ranges* .
• Mix was healthy: professional services $9.38M and processing/maintenance $6.56M; no license revenue as expected; opex increased (R&D $3.19M, G&A $2.04M), moderating sequential operating income .
• Company did not host a Q2 earnings call due to the pending Euronet merger; merger announced July 30 values CCRD at ~$248M ($30/share), expected closing late 2025, subject to customary approvals .

What Went Well and What Went Wrong

What Went Well

• Strong YoY growth and margin expansion: revenue $17.6M (+27.5% YoY), operating income $2.66M vs $1.15M, adjusted EBITDA $4.19M vs $2.48M; adjusted EBITDA margin rose to 23.8% from 17.9% .
• Services composition healthy and diversified: professional services $9.38M, processing/maintenance $6.56M, third-party $1.65M; no license dependence, consistent with management’s 2025 expectations .
• Management affirmed strong non-Goldman growth trajectory on the prior call: “growth from customers excluding our largest customer… 30% to 35% for the full year” (Q1) .

What Went Wrong

• Sequential operating income softened: Q2 operating income $2.66M vs Q1 $2.81M, with higher R&D ($3.19M) and G&A ($2.04M) spend weighing on OI; tax expense also rose to $0.70M .
• Customer-specific headwinds: Deserve sale to Intuit likely to roll off revenues over time; management is “not in discussions with Intuit… relationship with Deserve [to] roll off” (Q1) .
• Elevated investment losses persisted: Q2 investment loss $0.15M; management continues to expect no license revenue in 2025 (prior calls/press) .

Financial Results

Segment revenue (services) detail:

Balance sheet KPIs (selected):

Q2 2025 Actual vs Wall Street Consensus (S&P Global):

Values retrieved from S&P Global.*

Guidance Changes

Note: Company did not host a Q2 call and did not update guidance in Q2 PR due to pending Euronet transaction; refer to 10‑Q for details .

Earnings Call Themes & Trends

Management Commentary

• “For the full year 2025, we now expect revenues to be between $65 million and $69 million and earnings per share between $1.10 and $1.18.” — Matthew White, Q1 2025 .
• “We continue to onboard new customers… we currently have multiple implementations in progress and new customers we expect to go live in the coming months.” — Matthew White, Q1 2025 .
• “We may not be independent forever, and we're constantly evaluating opportunities… both options are good and they're actually on the table.” — Leland Strange, Q1 2025 .
• “CoreCard… is extremely well positioned to capture the growing demand for next-generation card management platforms.” — Leland Strange, Q4 2024 prepared remarks .
• “Due to CoreCard’s pending acquisition by Euronet… CoreCard will not be hosting a webcast or conference call to discuss results.” — Q2 2025 press release .
• “We expect [the acquisition] to be accretive in the first full year post close.” — Michael J. Brown, Euronet CEO (merger release) .

Q&A Highlights

• Industry consolidation impact: Management sees limited disruption from Global Payments/FIS card issuing consolidation, modest opportunities but “business as usual” (Q1) .
• Ex-Goldman growth clarity: Confirmed 30%–35% full-year ex-Goldman growth; consistent with prior guidance (Q1) .
• Deserve → Intuit: Relationship expected to roll off; not in discussions with Intuit; headwind incorporated into guidance (Q1) .
• Goldman revenue drivers: Higher managed services rates from the Oct-2024 amendment and normal development hours; 2025 run-rate consistent (Q1) .
• Employee retention plan: Designed to deter poaching by larger firms; provides stock with provisions linked to acquisition scenarios (Q1) .

Estimates Context

• Q2 2025 beats: Revenue $17.59M vs $16.45M consensus* and Primary EPS $0.31 vs $0.23 consensus*; EPS beat is on “Primary EPS” basis used by S&P Global; GAAP diluted EPS was $0.24 (within Q1 guidance) .
  Values retrieved from S&P Global.*

Where estimates may need to adjust:

• Raise FY models on services revenue strength and adjusted margin profile; incorporate continued R&D/G&A investment and the Deserve roll-off.
• Consider merger timeline and potential near-term IR/communication changes (no Q2 call), plus integration trajectory with Euronet’s Ren architecture .

Key Takeaways for Investors

• Solid execution: Broad-based services strength pushed revenue and adjusted EPS above consensus; adjusted EBITDA margin remained >23% .
• Guidance trajectory improved in Q1 and Q2 results outperformed quarterly guidance, increasing confidence in H2 setup even as opex rises .
• Customer concentration remains a monitored risk (Goldman/Apple Card), but ex-Goldman growth is robust and a key part of the multi-year thesis .
• Strategic catalyst: Euronet merger (stock-for-stock at $30/share) provides scale, global distribution, and potential accretion; regulatory/shareholder approvals outstanding .
• Model implications: Shift mix to recurring services, no 2025 license revenue; bake in tax rate 24%–27% from prior commentary and modest investment losses .
• Near-term trading lens: Expect narrative focus on merger milestones and confirmation of non-Goldman growth; absence of Q2 call reduces real-time detail but core KPIs remain supportive .
• Medium-term thesis: Platform differentiation (CoreFinity build, scale in revolving credit) and partnerships (Cardless, others) underpin durable growth beyond the largest customer .