CPI Card Group CFO Exits After 67% Stock Collapse
February 17, 2026 · by Fintool Agent
Cpi Card Group CFO Jeffrey Hochstadt is stepping down after nearly three years in the role, with his departure coinciding with the payment card manufacturer's stock having fallen 67% from its December 2024 peak. The Littleton, Colorado-based company appointed Terra Grantham, a seven-year company veteran, as Interim CFO effective February 13, 2026.
The transition comes as CPI grapples with margin compression, tariff headwinds, and a brutal earnings miss that sent shares tumbling 17% in a single day last November. Hochstadt will remain in an advisory capacity through June 30, 2026, and is eligible for severance under existing company guidelines.
A Difficult Tenure
Hochstadt joined CPI Card Group as CFO in May 2023 when shares traded around $26.61. The stock initially performed well, reaching a 52-week high of $34.30 in December 2024, but the narrative shifted dramatically in 2025.
The company's Q3 2025 results, released November 4, 2025, triggered a 17% single-day collapse. CPI reported EPS of $0.47, missing the $0.63 consensus estimate by 25%, and simultaneously cut full-year guidance.
The 8-K filing states only that Hochstadt and the company "agreed" that he would cease serving as CFO—language that suggests a mutual parting rather than termination for cause. No specific reason was provided for the departure.
Ask Fintool AI AgentThe Root Causes: Margins Under Siege
CPI's challenges trace to a confluence of headwinds that materialized throughout 2025:
Margin Compression: Gross profit margin contracted sharply from 35.8% to 29.7% year-over-year in Q3 2025, driven by unfavorable sales mix toward higher-volume, lower-margin orders and increased production costs.
Tariff Exposure: The company faced $4-5 million in tariff costs for 2025, with the China rate at 45%. CFO Hochstadt noted on the Q3 call that the company was "pushing back every single day on our suppliers to try to reduce the impact," but could only get the impact down to the $4 million range.
Operational Transition: CPI's new Indiana production facility, while now fully operational, incurred approximately $3 million in incremental transition costs during 2025 as the company ran duplicate facilities.
Semiconductor Tariff Overhang: The specter of additional semiconductor chip tariffs continued to hang over the industry. On the Q3 call, Hochstadt acknowledged that chips are "the biggest cost component when you talk about material cost, significantly."
Financial Performance
Despite the margin challenges, CPI has continued to grow revenue, driven by acquisitions and its instant issuance business:
| Metric | Q4 2023 | Q1 2024 | Q2 2024 | Q3 2024 | Q4 2024 | Q1 2025 | Q2 2025 | Q3 2025 |
|---|---|---|---|---|---|---|---|---|
| Revenue ($M) | $102.9 | $111.9 | $118.8 | $124.8 | $125.1 | $122.8 | $129.8 | $138.0 |
| Net Income ($M) | $2.7 | $5.5 | $6.0 | $1.3 | $6.8 | $4.8 | $0.5 | $2.3 |
| EBITDA Margin | 14.2%* | 16.2%* | 16.0%* | 17.6%* | 16.1% | 14.9% | 11.5% | 13.9%* |
*Values retrieved from S&P Global
The Q3 2025 guidance cut revised full-year expectations to low double-digit to low teens net sales growth (from mid-teens) and flat to low single-digit adjusted EBITDA growth (from mid-to-high single-digit).
Insider Activity: Mixed Signals
Recent insider transactions paint a complicated picture. On December 4, 2025, major holder Parallel49 Equity sold 2,126,056 shares at $13.51, reducing its position by approximately 44%—a disposal worth over $28.7 million.
However, on the same day, Chairman H. Sanford Riley purchased 200,000 shares at the same $13.51 price through Tricor Pacific Capital, demonstrating a degree of confidence from the board.
Hochstadt's own insider activity was limited to standard RSU vestings and tax withholdings—no discretionary open-market purchases during his tenure.
Ask Fintool AI AgentMeet the New CFO
Terra Grantham, 55, steps into the Interim CFO role with deep institutional knowledge. She joined CPI in 2017 and has held progressively senior roles:
- October 2025-Present: SVP Enterprise Strategy and Growth
- 2022-2025: SVP Financial Planning & Analysis and Strategy (also oversaw Treasury)
- 2021-2022: VP Strategy and ESG
- Pre-2021: Various finance, transformation, and strategy roles
Before CPI, Grantham spent time at The Western Union Company and Unilever, accumulating over 25 years of experience in senior finance, strategy, and product development roles.
No changes to Grantham's compensation were disclosed in connection with her appointment.
What to Watch
Q4 2025 Earnings (expected early March): Management projected "strong year-on-year growth in the fourth quarter for both net sales and adjusted EBITDA." Whether the company delivers will be a key test for the new finance leadership and could determine whether the stock stabilizes.
Semiconductor Tariff Resolution: The proposed semiconductor chip tariffs remain an overhang. As Hochstadt noted, chips represent a significant portion of card production costs. Any clarity—positive or negative—will move the stock.
Permanent CFO Search: Grantham is serving in an interim capacity. Investors will watch for signals on whether she'll be named permanent CFO or if an external search is underway.
Indiana Facility Ramp: The new production facility is now fully operational, which should alleviate some margin pressure in 2026 as dual-site costs fade.
Karta Partnership Progress: CPI invested $10 million in Australian prepaid technology firm Karta and is piloting chip-enabled prepaid cards with a large national retailer. Success here could open a meaningful new revenue stream.
Ask Fintool AI AgentBottom Line
Jeffrey Hochstadt's departure from CPI Card Group doesn't appear scandal-driven—the advisory transition period, severance eligibility, and "agreed" language all suggest a relatively amicable parting. But his exit after a brutal stock decline underscores just how challenging the operating environment has become for this small-cap payment card manufacturer.
Terra Grantham inherits a company with a clear market leadership position in prepaid packaging and growing instant issuance business, but also one facing structural margin pressure and tariff uncertainty. Whether she can stabilize operations and rebuild investor confidence will determine if this CFO transition becomes a footnote or a turning point.
PMTS shares trade at $11.38, giving the company a market cap of approximately $130 million and a P/E ratio near 11x trailing earnings.