UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ——————— FORM 10-Q ——————— ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: June 30, 2025 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from: _____________ to _____________ ACCESS Newswire Inc. (Exact name of registrant as specified in its charter) (State or Other Jurisdiction of Incorporation ...

ACCESS Newswire Reports Second Quarter 2025 Results Operational Efficiencies Improve, Increasing EBITDA and Cash Flow RALEIGH, NC / ACCESS Newswire / ACCESS Newswire Inc. (NYSE American:ACCS) (the "Company"), a leading communications company, today reported its operating results for the three and six months ended June 30, 2025. "We're pleased to report another quarter of sequential growth, highlighting the continued momentum of our business as we execute on our long-term strategy," said Brian R. Balbirnie, ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ACCESS Newswire Inc. (Exact name of registrant as specified in its charter) (State or Other Jurisdiction (Commission ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: March 31, 2025 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from: _____________ to _____________ Delaware 1-10185 26 ...

EX-99.1 2 accs_ex991.htm PRESS RELEASE EXHIBIT 99.1 Mr. Balbirnie concluded, "Over the past several months, we've communicated that the shifts in customer counts, revenue, and subscriptions during Q1 would begin to stabilize by quarter's end—and that has proven true. Excluding the impact of compliance subscription customers, we achieved net subscription growth of 9% for the quarter compared to the prior year. While that's not yet where we want to be, we believe it sets the stage for faster growth in the qua ...

Part I [Item 1. Description of Business](index=4&type=section&id=Item%201.%20Description%20of%20Business.) ACCESS Newswire Inc., formerly Issuer Direct Corporation, provides PR and IR communication platforms, focusing on subscription services for B2B companies, and recently divested its Compliance business to enhance focus on its core platform - The company changed its name from Issuer Direct Corporation to ACCESS Newswire Inc., effective January 27, 2025, as part of a major rebranding initiative[24](index=24&type=chunk)[26](index=26&type=chunk)[53](index=53&type=chunk) - The company's core business is a customer platform for Public Relations (PR) and Investor Relations (IR), offering products like Press Release Distribution, Media Monitoring, Database and Pitching, IR Websites, and Event technologies[28](index=28&type=chunk)[29](index=29&type=chunk) - As of December 31, 2024, the company had **1,124 subscriptions** generating an annual recurring revenue (ARR) of approximately **$12 million**[30](index=30&type=chunk) - In Q4 2024, the company began marketing its Compliance business for sale, which was finalized on February 28, 2025. The assets, revenue, and expenses of this business are now classified as discontinued operations[31](index=31&type=chunk) Customer and Employee Data (2023-2024) | Metric | 2024 | 2023 | | :--- | :--- | :--- | | **Total Customers** | 12,349 | 11,924 | | **Sales & Marketing Personnel** | 27 | 35 | | **Total Employees & Contractors** | 113 | N/A | - The company's growth strategy focuses on expanding its customer base, increasing revenue from existing customers, growing internationally (currently **12% of revenue**), innovating the platform, and pursuing selective acquisitions[55](index=55&type=chunk)[56](index=56&type=chunk)[57](index=57&type=chunk)[58](index=58&type=chunk)[59](index=59&type=chunk) [Item 1A. Risk Factors](index=10&type=section&id=Item%201A.%20Risk%20Factors.) The company faces intense competition, integration challenges, reliance on press release distribution, risks from the Compliance business sale, key personnel dependency, cybersecurity threats, technological changes, and Credit Agreement obligations - The company operates in a highly competitive environment, facing pressure on pricing and market share from competitors with greater resources and name recognition[77](index=77&type=chunk)[79](index=79&type=chunk) - The historical Communications revenue stream, which saw growth from **13% to 55%** between 2016-2023, decreased by **7% in 2024**, indicating past performance is not a reliable indicator of future results[83](index=83&type=chunk) - The sale of the Compliance business on February 28, 2025, for **$12.5 million** involved using the entire **$12 million** closing cash to reduce debt, meaning the company received no immediate cash from the transaction. There is a risk the remaining business may not replace the lost revenue and cash flow[90](index=90&type=chunk)[91](index=91&type=chunk) - A substantial portion of business is derived from the press release distribution brands (ACCESS Newswire), which depend on key distribution partners and technology. Any disruption could materially impact the business[87](index=87&type=chunk) - The company's obligations under its Credit Agreement are secured by a first priority security interest in substantially all assets. Failure to comply with financial covenants could lead to an event of default, allowing the creditor to accelerate repayment and enforce its security interests[116](index=116&type=chunk)[117](index=117&type=chunk)[118](index=118&type=chunk) - The company has not declared quarterly dividends since the third quarter of 2018 and states there can be no assurances that dividends will be paid in the future[126](index=126&type=chunk) [Item 1B. Unresolved Staff Comments](index=18&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments.) The company reports that it has no unresolved staff comments - None[133](index=133&type=chunk) [Item 1C. Cybersecurity](index=18&type=section&id=Item%201C.%20Cybersecurity.) The company integrates cybersecurity risk management into its overall strategy, with oversight from the CTO, CEO, and Board, and has not experienced material impacts from incidents to date - The company's cybersecurity processes are managed by information technology security professionals who work with the CTO and CEO to assess, detect, and respond to threats[134](index=134&type=chunk)[135](index=135&type=chunk) - The Board of Directors is responsible for oversight of cybersecurity risk, receiving regular reports from the CTO or CEO at least annually[141](index=141&type=chunk) - Risks from previous cybersecurity incidents have not materially affected, and are not reasonably likely to materially affect, the company's business, strategy, or financial condition[138](index=138&type=chunk) [Item 2. Property](index=19&type=section&id=Item%202.%20Property.) The company's headquarters are in Raleigh, North Carolina, occupying 9,766 square feet of leased office space with a lease expiring December 31, 2027 - The company leases **9,766 square feet** of office space for its headquarters in Raleigh, North Carolina, with the lease expiring on December 31, 2027[143](index=143&type=chunk) [Item 3. Legal Proceedings](index=19&type=section&id=Item%203.%20Legal%20Proceedings.) The company is not currently a party to any material litigation or aware of any threatened legal proceedings that would materially impact its business - The company is not currently party to any material legal proceedings[144](index=144&type=chunk) [Item 4. Mine Safety Disclosures](index=19&type=section&id=Item%204.%20Mine%20Safety%20Disclosures.) This item is not applicable to the company - Not applicable[145](index=145&type=chunk) Part II [Item 5. Market for Common Equity and Related Stockholder Matters](index=19&type=section&id=Item%205.%20Market%20for%20Common%20Equity%20and%20Related%20Stockholder%20Matters.) As of December 31, 2024, the company had **3,838,743 outstanding common shares** held by approximately **150 registered holders**, with no dividends paid in 2023 or 2024 and no guarantee of future payments - As of December 31, 2024, there were **3,838,743 shares** of common stock outstanding held by approximately **150 registered holders** of record[147](index=147&type=chunk) - The company did not pay any dividends during the years ended December 31, 2024 and 2023. The declaration of future dividends is at the discretion of the Board of Directors[148](index=148&type=chunk) [Item 6. Select Financial Data](index=19&type=section&id=Item%206.%20Select%20Financial%20Data.) Selected financial data for continuing operations shows a **6% revenue decrease** in 2024, leading to a **$16.3 million operating loss** and a **$13.3 million net loss**, primarily due to a **$14.15 million intangible asset impairment charge** Summary of Operations from Continuing Operations (in thousands) | | 2024 | 2023 | | :--- | :--- | :--- | | **Revenue** | $23,057 | $24,522 | | **Gross margin** | $17,440 | $18,915 | | **Impairment loss on intangible assets** | $14,150 | $— | | **Operating loss** | $(16,319) | $(2,739) | | **Loss from continuing operations** | $(13,281) | $(3,441) | [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=20&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20and%20Results%20of%20Operations) Management attributes the **6% revenue decline** to a **15% decrease** in the Newswire business, with a **$14.15 million impairment charge** contributing to a **$13.3 million net loss** from continuing operations, while non-GAAP Adjusted EBITDA was **$1.9 million** Comparison of Operations (Continuing Operations, in thousands) | | 2024 | 2023 | | :--- | :--- | :--- | | **Revenues** | $23,057 | $24,522 | | **Gross Margin** | $17,440 (76%) | $18,915 (77%) | | **Total operating expenses** | $33,759 | $21,654 | | **Impairment loss on intangible assets** | $14,150 | $— | | **Operating loss** | $(16,319) | $(2,739) | | **Net loss from continuing operations** | $(13,281) | $(3,441) | - Total revenue decreased by **6% in 2024**, primarily due to a **15% decrease** in revenue from the previously branded Newswire business[157](index=157&type=chunk) - A **$14.15 million impairment charge** was recorded for Newswire trademarks in 2024. This was due to the company's rebranding to ACCESS Newswire, which shortened the useful life of the Newswire trademarks from 15 to 5 years[167](index=167&type=chunk) - As of Dec 31, 2024, current liabilities from continuing operations exceeded current assets by **$2.788 million**. The company expects to resolve this negative working capital with the proceeds from the sale of its Compliance business in February 2025[172](index=172&type=chunk) Non-GAAP Adjusted EBITDA Reconciliation (in thousands) | | 2024 | 2023 | | :--- | :--- | :--- | | **Net loss from continuing operations** | $(13,281) | $(3,441) | | Adjustments: | | | | Impairment loss on intangible assets | 14,150 | — | | Depreciation and amortization | 2,928 | 2,788 | | Interest expense, net | 1,107 | 1,249 | | Income tax benefit | (4,064) | (938) | | Other non-recurring & stock-based comp | 1,055 | 2,347 | | **Adjusted EBITDA** | **$1,895** | **$2,005** | Non-GAAP Net Income Reconciliation (in thousands) | | 2024 | 2023 | | :--- | :--- | :--- | | **Net loss from continuing operations** | $(13,281) | $(3,441) | | Adjustments (Impairment, Amortization, etc.) | 17,764 | 4,906 | | Tax impact of adjustments & discrete items | (3,692) | (927) | | **Non-GAAP net income** | **$791** | **$538** | [Item 7A. Quantitative and Qualitative Disclosures About Market Risk](index=27&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk.) The company believes it faces no material market risk regarding its cash and cash equivalents, which totaled **$4.1 million** at year-end 2024, and held no marketable securities - The company does not believe it faces material market risk with respect to its cash or cash equivalents, which totaled **$4,103,000** at December 31, 2024[202](index=202&type=chunk) [Item 8. Financial Statements and Supplementary Data](index=27&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data.) The company's consolidated financial statements and the independent registered public accountants' report are included in Item 15, beginning on page F-1 - The required financial statements are set forth in Item 15 of the Annual Report, beginning on Page F-1[203](index=203&type=chunk)[204](index=204&type=chunk) [Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=27&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure.) The company reports no changes in or disagreements with its accountants regarding accounting and financial disclosure - None[205](index=205&type=chunk) [Item 9A. Controls and Procedures](index=27&type=section&id=Item%209A.%20Controls%20and%20Procedures.) Management concluded that disclosure controls and internal control over financial reporting were effective as of December 31, 2024, with the company exempt from external attestation as a smaller reporting company - Management concluded that the company's disclosure controls and procedures were effective as of December 31, 2024[208](index=208&type=chunk) - The company's registered public accounting firm did not provide an attestation report on internal control over financial reporting, as permitted by SEC rules for smaller reporting companies[207](index=207&type=chunk) - Management concluded that internal control over financial reporting was effective as of December 31, 2024, based on the COSO 2013 framework[211](index=211&type=chunk) [Item 9B. Other Information](index=28&type=section&id=Item%209B.%20Other%20Information.) No director or officer adopted or terminated a Rule 10b5-1 trading arrangement during the fourth quarter of 2024 - No director or officer adopted or terminated a Rule 10b5-1 trading arrangement in the fourth quarter of 2024[213](index=213&type=chunk) [Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](index=28&type=section&id=Item%209C.%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20that%20Prevent%20Inspections.) This item is not applicable to the company - Not applicable[214](index=214&type=chunk) Part III [Item 10. Directors, Executive Officers and Corporate Governance](index=28&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information on directors, executive officers, and corporate governance is incorporated by reference from the 2025 Proxy Statement, with the company having adopted a Code of Conduct and Insider Trading Policy - Required information is incorporated by reference from the definitive proxy statement for the 2025 annual meeting of stockholders[215](index=215&type=chunk) - The company has adopted a Code of Conduct applicable to all officers, directors, and employees, which is available on its website[216](index=216&type=chunk) [Item 11. Executive Compensation](index=29&type=section&id=Item%2011.%20Executive%20Compensation.) Information regarding executive compensation is incorporated by reference from the company's 2025 Proxy Statement, to be filed within 120 days after fiscal year-end - Required information is incorporated by reference from the 2025 Proxy Statement[218](index=218&type=chunk) [Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=29&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters.) Information on security ownership by beneficial owners and management, including equity compensation plans, is incorporated by reference from the company's 2025 Proxy Statement - Required information is incorporated by reference from the 2025 Proxy Statement[219](index=219&type=chunk) [Item 13. Certain Relationships and Related Transactions, and Director Independence](index=29&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence.) Information on related party transactions and director independence is incorporated by reference from the company's 2025 Proxy Statement - Required information is incorporated by reference from the 2025 Proxy Statement[220](index=220&type=chunk) [Item 14. Principal Accountant Fees and Services](index=29&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services.) Information on principal accountant fees and services, including pre-approval policies, is incorporated by reference from the company's 2025 Proxy Statement - Required information is incorporated by reference from the 2025 Proxy Statement[221](index=221&type=chunk) Part IV [Item 15. Exhibits, Financial Statement Schedules](index=29&type=section&id=Item%2015.%20Exhibits.) This section lists financial statements and exhibits filed with the Form 10-K, including corporate documents, material contracts, and officer certifications, indicating their filing status - The financial statements listed in the index on page F-1 are filed as part of this Form 10-K[223](index=223&type=chunk) - Exhibits filed include material agreements such as the Credit Agreement with Pinnacle Bank, the Asset Purchase Agreement with Equiniti, and officer certifications[224](index=224&type=chunk)[225](index=225&type=chunk) [Financial Statements and Supplementary Data](index=31&type=section&id=Financial%20Statements%20and%20Supplementary%20Data) Audited consolidated financial statements for 2024 and 2023 are presented with an unqualified auditor's opinion, detailing a **$10.8 million net loss** in 2024, driven by an impairment charge and loss from continuing operations, and providing notes on discontinued operations and subsequent events - The independent auditor, Cherry Bekaert LLP, issued an unqualified opinion on the consolidated financial statements[235](index=235&type=chunk) - Critical Audit Matters identified by the auditor include: Revenue from Contracts with Customers, Collectability of Accounts Receivable, and Goodwill and Intangible Assets Impairment Assessment[239](index=239&type=chunk) Consolidated Financial Highlights (in thousands) | | Dec 31, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | **Total Assets** | $50,638 | $65,152 | | **Total Liabilities** | $25,412 | $29,732 | | **Total Stockholders' Equity** | $25,226 | $35,420 | | **Net (Loss) Income** | $(10,793) | $766 | | **Net Cash from Operating Activities** | $3,160 | $3,060 | - On February 28, 2025, the company sold its Compliance business. The assets and liabilities of this business are classified as held-for-sale and its results are reported as discontinued operations[303](index=303&type=chunk)[304](index=304&type=chunk)[305](index=305&type=chunk) - An impairment charge of **$14,150,000** was recognized in 2024 related to Newswire trademarks due to a reduction in their estimated useful life from 15 to 5 years following the company's rebranding[312](index=312&type=chunk) - As a subsequent event, on February 28, 2025, the company used **$12,000,000** from the asset sale to pay down its Term Loan with Pinnacle Bank, reducing the principal balance to **$3,333,333**[361](index=361&type=chunk)[362](index=362&type=chunk)[364](index=364&type=chunk)

Revenue Performance - Revenue for Q4 2024 increased by 1% to $5.8 million compared to $5.76 million in Q4 2023[6] - Full year 2024 total revenue was $23.057 million, a 6% decrease from $24.522 million in 2023[11] - For the three months ended December 31, 2024, the company reported revenues of $5,826,000, a slight increase from $5,762,000 in the same period of 2023[29] Profitability and Loss - Adjusted EBITDA for Q4 2024 was $871,000, representing 15% of revenue, up from a loss of $(27,000) in Q4 2023[7] - Net loss from continuing operations for Q4 2024 was $(10.945) million, or $(2.85) per diluted share, compared to a net loss of $(1.512) million, or $(0.40) per diluted share in Q4 2023[7] - Operating loss for the full year 2024 was $(16.319) million, compared to $(2.739) million in 2023, primarily due to a $14.15 million impairment loss[11] - The company reported a net loss from continuing operations of $(13,281,000) for the year ended December 31, 2024, compared to $(3,441,000) in 2023, indicating a worsening loss situation[29] - The company reported a net loss of $10,793 million for the year ended December 31, 2024, compared to a net income of $766 million in 2023[32] Cash Flow and Financial Health - Cash flow from operations improved to $353,000 in Q4 2024 from $(236,000) in Q4 2023[6] - The net cash provided by operating activities for the full year ended December 31, 2024, was $400,000, a significant improvement from a cash used of $(741,000) in 2023[17] - The adjusted free cash flow for the full year ended December 31, 2024, was $26,000, compared to $(476,000) in 2023, reflecting a positive turnaround[17] - Net cash provided by operating activities from discontinued operations was $2,760 million, down from $3,801 million in 2023[32] - Total cash and cash equivalents at the end of the period were $4,103 million, a decrease from $5,714 million at the beginning of the year[32] Asset and Liability Management - Total assets decreased from $65,152,000 in 2023 to $50,638,000 in 2024, a decline of approximately 22.3%[26] - The company's total liabilities decreased from $29,732,000 in 2023 to $25,412,000 in 2024, a reduction of about 14.5%[26] Customer Metrics - Subscription customers increased to 1,124 in Q4 2024 from 1,053 in Q4 2023[6] - Annual recurring revenue (ARR) for subscriptions reached $10.735 million, up from $9.489 million at the end of 2023[11] Impairment and Investments - The company incurred an impairment loss on intangible assets of $14,150,000 for the three months ended December 31, 2024, compared to no such loss in the same period of 2023[29] - The company incurred a loss on impairment of intangible assets amounting to $14,150 million, indicating potential challenges in asset valuation[32] - Capitalized software expenditures rose to $597 million, compared to $478 million in 2023, reflecting ongoing investment in technology[32] Strategic Outlook - The company aims to optimize capital allocation and increase customer counts and market share moving forward[4] - The company expects to continue to award stock in exchange for services, but the amount of stock-based compensation is excluded from certain adjustments due to its variability[1] - The company did not make any acquisitions during the year, as indicated by the absence of cash outflows for business purchases[32]

Core Perspective - Issuer Direct Corp has rebranded itself as ACCESS Newswire Inc, signaling a strategic shift towards enhancing its communication services and expanding its market presence [1] Company Overview - The rebranding aims to reflect the company's commitment to providing innovative communication solutions and to better align with its evolving business model [1] - ACCESS Newswire Inc will focus on delivering comprehensive news distribution services, targeting a broader audience and enhancing client engagement [1] Industry Implications - The rebranding is expected to position the company favorably within the competitive landscape of news distribution and public relations, as it seeks to leverage technology to improve service delivery [1] - This move may indicate a trend within the industry where companies are increasingly adopting modern branding strategies to stay relevant and meet changing client needs [1]

Financial Performance - Total revenue decreased by $616,000, or 8%, to $6,953,000 for the three months ended September 30, 2024, compared to $7,569,000 for the same period in 2023[109] - Communications revenue decreased by $597,000, or 10%, to $5,481,000 for the three months ended September 30, 2024, compared to $6,078,000 for the same period in 2023[110] - Compliance revenue decreased by $19,000, or 1%, and $2,541,000, or 35%, during the three and nine months ended September 30, 2024, respectively[111] - Operating income was $156,000 for the three months ended September 30, 2024, compared to $593,000 for the same period in 2023[105] - Net income (loss) was $(466,000) for the three months ended September 30, 2024, compared to $273,000 for the same period in 2023[105] - For the three months ended September 30, 2024, the company reported a net loss of $466,000, or $(0.12) per diluted share, compared to a net income of $273,000, or $0.07 per diluted share for the same period in 2023[136] - For the nine months ended September 30, 2024, the company reported a net loss of $598,000, or $(0.16) per diluted share, compared to a net income of $1,492,000, or $0.39 per diluted share for the same period in 2023[136] - Non-GAAP net income for the nine months ended September 30, 2024, was $1,809,000, or $0.47 per diluted share, compared to $4,314,000, or $1.13 per diluted share for the same period in 2023[136] Expenses and Margins - Gross margin percentage decreased to 74% and 75% for the three and nine months ended September 30, 2024, respectively, compared to 76% and 77% during the same periods in 2023[113] - General and administrative expenses were $2,008,000 during the three months ended September 30, 2024, a decrease of $25,000, or 1%, compared to the same period in 2023[116] - Sales and marketing expenses were $1,618,000 for the three months ended September 30, 2024, a decrease of $220,000, or 12%, compared to the same period in 2023[118] - Total cost of revenue decreased by $16,000, or 1%, and $496,000, or 8%, during the three and nine months ended September 30, 2024, respectively[113] - Product development expenses increased by $90,000 (15%) to $671,000 for the three months ended September 30, 2024, and by $157,000 (8%) to $2,044,000 for the nine months ended September 30, 2024, compared to the same periods in 2023[120] - As a percentage of revenue, product development expenses were 10% and 9% for the three and nine months ended September 30, 2024, respectively, up from 8% in the same periods of 2023[121] - Interest expense decreased to $280,000 for the three months and $903,000 for the nine months ended September 30, 2024, compared to $368,000 and $1,080,000 in the same periods of 2023[122] Cash Flow and Financial Position - As of September 30, 2024, the company had $4,086,000 in cash and cash equivalents, with current liabilities totaling $12,593,000, resulting in a current liabilities exceeding current assets by $2,560,000[125] - Free cash flow for the three months ended September 30, 2024, was $1,358,000, compared to $110,000 in the same period of 2023[132] - Adjusted free cash flow for the nine months ended September 30, 2024, was $1,860,000, down from $2,638,000 in the same period of 2023[132] - Adjusted EBITDA for the three months ended September 30, 2024, was $1,369,000, compared to $1,756,000 in the same period of 2023[134] - Adjusted EBITDA for the nine months ended September 30, 2024, was $3,585,000, down from $6,663,000 in the same period of 2023[135] Strategic Initiatives - The company aims to increase the Communications portion of its business relative to Compliance, indicating a strategic shift in focus[79] - The company plans to continue focusing on expanding its Communications products and aligning sales and marketing teams to enhance its offerings[141] - The company aims to invest in technology advancements and evaluate acquisitions as part of its strategic initiatives for sustainable growth[141] - The company believes that the transition to a platform subscription model is key for long-term sustainable growth[141] Market and Economic Factors - Market factors such as global inflation and geopolitical conflicts have contributed to economic uncertainty, but the company believes demand for its platforms remains stable[139] - The company acknowledges potential risks related to goodwill and intangible asset write-downs if stock prices decline or demand for its services does not stabilize[140] Product and Service Developments - Issuer Direct Corporation reported significant growth in its Communications segment, with revenues increasing year-over-year, driven by enhancements in the ACCESSWIRE platform[82] - The company acquired Newswire on November 1, 2022, and fully integrated its distribution network into ACCESSWIRE by early 2023, expanding its service offerings[83] - The Media Suite subscription add-on was launched, providing communication professionals with tools for media pitching, monitoring, and database access, enhancing customer engagement[86] - The webcasting platform allows for live and on-demand streaming of events, with an estimated 5,000 companies in North America conducting earnings events each quarter[94] - Significant upgrades to the investor relations website were released in 2023, including ADA and AODA compliance, which require a recurring annual subscription[97] - The Compliance segment includes a disclosure software module designed for companies to manage SEC filings, generating revenue from both software and services[99] - The whistleblower hotline, a supported product of NYSE offerings, is being upgraded to enhance incident response and management processes[100] - The stock transfer module provides real-time information about shareholders and stock ledgers, focusing on subscription sales to improve efficiency[101] - Partnerships with stock exchanges are expected to enhance brand exposure and revenue potential in targeted customer segments[81] Other Financial Information - As of September 30, 2024, the deferred revenue balance was $5,308,000, a decrease of 2% from $5,412,000 as of December 31, 2023[112] - The company experienced a loss of $343,000 related to the change in fair value of its interest rate swap for the three months ended September 30, 2024[137] - The company has no off-balance sheet arrangements that could materially affect its financial condition[143]

Core Viewpoint - Issuer Direct Corporation reported quarterly earnings of $0.17 per share, missing the Zacks Consensus Estimate of $0.20 per share, and showing a decline from $0.27 per share a year ago, indicating a -15% earnings surprise [1][2] Financial Performance - The company posted revenues of $6.95 million for the quarter ended September 2024, missing the Zacks Consensus Estimate by 2.62%, and down from $7.57 million year-over-year [2] - Over the last four quarters, Issuer Direct has surpassed consensus EPS estimates only once and has topped consensus revenue estimates just once [2] Stock Performance - Issuer Direct shares have declined approximately 43.5% since the beginning of the year, contrasting with the S&P 500's gain of 24.3% [3] - The current Zacks Rank for Issuer Direct is 3 (Hold), indicating expected performance in line with the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.24 on revenues of $7.79 million, and for the current fiscal year, it is $0.74 on revenues of $29.57 million [7] - The trend of estimate revisions for Issuer Direct is mixed, which could change following the recent earnings report [6] Industry Context - The Commercial Printing industry, to which Issuer Direct belongs, is currently ranked in the top 12% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8]

Revenue Performance - Total revenue for Q3 2024 was $6.95 million, an 8% decrease from $7.57 million in Q3 2023[3] - Total revenue for the first nine months of 2024 was $21.6 million, a 16% decrease from $25.8 million in the same period of 2023[8] - Revenues for the three months ended September 30, 2024, were $6,953,000, a decrease of 8.1% compared to $7,569,000 for the same period in 2023[28] Customer Metrics - Subscriptions increased to 1,121, up 9% from 1,050 in Q2 2024 and 7% from the prior year[2] - As of September 30, 2024, the company had 12,505 active customers, up from 12,171 a year earlier[14] Profitability and Income - Operating income decreased to $156,000 in Q3 2024, compared to $593,000 in Q3 2023[5] - Net loss for Q3 2024 was $(466,000), or $(0.12) per diluted share, compared to net income of $273,000, or $0.07 per diluted share in Q3 2023[5] - Non-GAAP adjusted EBITDA for Q3 2024 was $1.37 million, or 20% of revenue, compared to $1.76 million, or 23% of revenue in Q3 2023[7] - The company reported a net loss of $598,000 for Q3 2024, compared to a net income of $1,492,000 in Q3 2023, resulting in a diluted loss per share of $(0.16) versus earnings of $0.39[18] - Non-GAAP net income for Q3 2024 was $1,809,000, with a diluted earnings per share of $0.47, down from $4,314,000 and $1.13 per share in Q3 2023[18] Cash Flow and Operations - Cash flows from operations increased to $1.5 million in Q3 2024 from $0.3 million in Q3 2023[6] - Free cash flow for Q3 2024 was $1,358,000, significantly higher than $110,000 in Q3 2023, while adjusted free cash flow was $1,369,000 compared to $127,000 in the prior year[19] - For the nine months ended September 30, 2024, the company generated $2,294,000 in net cash from operating activities, slightly up from $2,290,000 in the same period of 2023[19] Balance Sheet - Total assets decreased to $61,723,000 as of September 30, 2024, down from $65,152,000 at the end of 2023[26] - The company’s total liabilities decreased to $26,459,000 as of September 30, 2024, compared to $29,732,000 at the end of 2023[27] - The company’s cash and cash equivalents were reported at $4,086,000 as of September 30, 2024, down from $5,714,000 at the end of 2023[26] - Cash and cash equivalents at the end of the period were $4,086,000, down from $5,050,000 at the end of the prior year[30] Expenses - The company incurred $468,000 in stock-based compensation expense in Q3 2024, down from $1,050,000 in Q3 2023[18] - Interest expense for the nine months ended September 30, 2024, was $(835,000), compared to $(817,000) in the same period last year[28] Strategic Focus - The company plans to continue focusing on strategic acquisitions and integration-related projects in the upcoming quarters[20] Other Financial Metrics - Gross margin for Q3 2024 was $5.17 million, or 74% of revenue, down from 76% in Q3 2023[4] - Gross profit for the nine months ended September 30, 2024, was $16,136,000, down 18.9% from $19,877,000 in the prior year[28] - Operating income for the three months ended September 30, 2024, was $156,000, a decline of 73.7% compared to $593,000 in the same period last year[28] - Net loss for the nine months ended September 30, 2024, was $(598,000), compared to a net income of $1,492,000 for the same period in 2023[29] - Capitalized software costs for the nine months ended September 30, 2024, were $(537,000), an increase from $(319,000) in the same period last year[30] - The company reported a decrease in accounts receivable of $(951,000) for the nine months ended September 30, 2024, compared to a decrease of $(1,669,000) in the prior year[29] - The weighted average number of common shares outstanding for the three months ended September 30, 2024, was 3,833,000, an increase from 3,810,000 in the same period last year[28] - The company’s goodwill remained stable at $21,927,000 as of September 30, 2024, unchanged from the end of 2023[26]