Financial Performance - Total revenue for Q3 2025 increased by $84,000, or 1%, to $5,723,000 compared to $5,639,000 in Q3 2024, while total revenue for the nine months ended September 30, 2025, decreased by $411,000, or 2%, to $16,820,000 compared to $17,231,000 in the same period of 2024[117]. - Operating loss for Q3 2025 was $(184,000), an improvement from $(604,000) in Q3 2024, while the nine-month operating loss was $(1,110,000) compared to $(1,997,000) in the same period of 2024[117]. - Net loss from continuing operations for Q3 2025 was $(45,000), compared to $(870,000) in Q3 2024, and for the nine months ended September 30, 2025, it was $(1,049,000) compared to $(2,336,000) in the same period of 2024[117]. - For the three months ended September 30, 2025, adjusted EBITDA from continuing operations was $933,000, a 70.6% increase from $546,000 in 2024[140]. - For the nine months ended September 30, 2025, adjusted EBITDA from continuing operations was $2,333,000, up 142.5% from $961,000 in 2024[140]. - The net loss from continuing operations for the three months ended September 30, 2025, was $45,000, a significant improvement compared to a loss of $870,000 in 2024[141]. - The net loss from continuing operations for the nine months ended September 30, 2025, was $1,049,000, reduced from a loss of $2,336,000 in 2024[141]. - Free cash flow from continuing operations for the three months ended September 30, 2025, was $(590,000), compared to $1,358,000 in 2024[142]. - Adjusted free cash flow from continuing operations for the three months ended September 30, 2025, was $(418,000), down from $1,369,000 in 2024[142]. Revenue and Subscriptions - As of September 30, 2025, the company has 972 subscriptions with an annual recurring revenue (ARR) of approximately $11.3 million[93]. - The company completed the sale of its Compliance business on February 28, 2025, categorizing related revenue and expenses as discontinued operations for the three and nine months ended September 30, 2025 and 2024[94]. - The company launched a new subscription platform in late 2024, officially rebranding to ACCESS Newswire at the beginning of 2025[93]. - The company maintains high gross margins while offering flexible pricing options for its press release distribution service, which is integrated into all three ACCESS subscription plans[100]. - Deferred revenue balance as of September 30, 2025, was $5,020,000, an increase of 6% from $4,743,000 at December 31, 2024, expected to be recognized over the next twelve months[118]. Expenses and Cost Management - Cost of revenues increased by $44,000, or 3%, in Q3 2025, while it decreased by $178,000, or 4%, for the nine months ended September 30, 2025, compared to the same periods in 2024[119]. - General and administrative expenses decreased by $409,000, or 22%, in Q3 2025, and by $185,000, or 3%, for the nine months ended September 30, 2025, compared to the same periods in 2024[120]. - Sales and marketing expenses decreased by $924,000, or 16%, for the nine months ended September 30, 2025, compared to the same period in 2024[122]. - Product development expenses increased by $13,000, or 2%, in Q3 2025, and by $28,000, or 1%, for the nine months ended September 30, 2025, compared to the same periods in 2024[124]. - Interest expense decreased to $57,000 in Q3 2025 from $280,000 in Q3 2024, due to reduced debt from the sale of the compliance business[126]. Product and Service Development - The company’s communications platform includes ACCESS PR and ACCESS IR subscriptions, which integrate various services such as press release distribution and investor relations[96]. - The company has expanded its distribution network and enhanced analytics reporting for its press release distribution products, anticipating continued growth in this area[99]. - The investor relations website offering received significant upgrades in 2023, including ADA and AODA compliance features[113]. - The company offers a professional conference and events software that integrates with its other services, providing a unique offering for conference organizers[111]. - The company’s media monitoring solution aims to be comprehensive within the next year, expanding across various media types[104]. - The company’s Incident Hotline, a whistleblower hotline offering, is a supported product of the NYSE, introducing the company to new IPO customers[114]. Market Outlook and Strategic Initiatives - The company anticipates stable demand for its platforms and services despite global economic uncertainties[145]. - The transition to a platform subscription model is expected to be key for the company's long-term sustainable growth[147]. - The company has no off-balance sheet arrangements that could materially affect its financial condition[147]. - Market factors such as military conflicts and global inflation have contributed to significant volatility in financial markets, impacting many industries[145].

Financial Performance - Q3 2025 revenue grew to $5.7M, a 2% increase from $5.6M in Q3 2024 and Q2 2025[5] - Q3 Adjusted EBITDA increased 71% to $933,000 compared to $546,000 in Q3 2024[5] - Gross margin percentage remained strong at 75% for Q3 2025[5] - Total revenue for the first nine months of 2025 was $16.8M, a 2% decrease from $17.2M during the same period in 2024[9] - Non-GAAP net income for Q3 2025 was $760,000, or $0.20 per diluted share, compared to $187,000, or $0.05 per diluted share, in Q3 2024[6] - Operating loss for Q3 2025 was $184,000, improved from $604,000 in Q3 2024[6] - Revenues for the three months ended September 30, 2025, were $5,723 million, a slight increase from $5,639 million in the same period of 2024[31] - Gross profit for the nine months ended September 30, 2025, was $12,826 million, down from $13,059 million in 2024, reflecting a decrease of approximately 1.8%[31] - Operating loss for the three months ended September 30, 2025, improved to $(184) million compared to $(604) million in the same period of 2024[31] - The company incurred a loss from continuing operations per share of $(0.01) for the three months ended September 30, 2025, compared to $(0.23) in 2024[31] Customer Metrics - As of September 30, 2025, the company had 12,445 active customers[9] - Subscription customers increased to 972 during the quarter[9] - Average ARR for subscriptions per customer rose to $11,651, up from $10,189 as of September 30, 2024[9] Cash Flow and Assets - Adjusted free cash flow for the first nine months of 2025 was $799,000 compared to $1.9M for the same period in 2024[9] - Free cash flow from continuing operations for the three months ended September 30, 2025, was $(590,000), compared to $1,358,000 for the same period in 2024[18] - Adjusted free cash flow from continuing operations for the nine months ended September 30, 2025, was $799,000, compared to $1,860,000 for the same period in 2024[18] - Cash flows from operating activities for the nine months ended September 30, 2025, provided $300 million, a decrease from $2,294 million in 2024[33] - Cash and cash equivalents at the end of September 30, 2025, were $3,261 million, down from $4,086 million at the end of September 30, 2024[33] Balance Sheet - Total assets as of September 30, 2025, were $44,050,000, down from $50,638,000 as of December 31, 2024[29] - Total liabilities as of September 30, 2025, were $13,256,000, a decrease from $25,412,000 as of December 31, 2024[29] - Stockholders' equity increased to $30,794,000 as of September 30, 2025, compared to $25,226,000 as of December 31, 2024[29] Future Outlook - The company plans to introduce product enhancements before year-end to enhance customer experience and support sustained top-line growth[25] Shareholder Information - The weighted average number of common shares outstanding for the three months ended September 30, 2025, was 3,870,000, compared to 3,835,000 for the same period in 2024[17]

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 ...

Executive Summary and Business Update [CEO Commentary](index=1&type=section&id=CEO%20Commentary) ACCESS Newswire achieved sequential Q2 2025 growth, strong gross margins, and increased subscription customers, driven by its subscription model transition - The company is transitioning to a subscription-based model, aiming for a sustainable and predictable business[2](index=2&type=chunk) - Key areas of focus include increasing revenue, maintaining strong gross margins, growing subscription customers, and improving adjusted EBITDA[2](index=2&type=chunk) - Operational efficiencies and upcoming product enhancements are expected to drive improved performance in the near and long term[2](index=2&type=chunk) Financial Highlights [Second Quarter 2025 Highlights](index=1&type=section&id=Second%20Quarter%202025%20Highlights) ACCESS Newswire reported mixed results for Q2 2025, with sequential revenue growth but a year-over-year decrease, while significantly improving adjusted EBITDA and achieving positive cash flow from operations | Metric | Q2 2025 | Q1 2025 | Q2 2024 | YoY Change (Q2 25 vs Q2 24) | QoQ Change (Q2 25 vs Q1 25) | | :-------------------------------- | :------ | :------ | :------ | :-------------------------- | :-------------------------- | | Revenue | $5.6M | $5.5M | $6.0M | -7% | +3% | | Adjusted EBITDA | $836,000 | N/A | $528,000 | +$308,000 | N/A | | Cash flow from operations | Positive | N/A | Negative | +$325,000 | N/A | | Subscriptions (end of period) | 971 | 955 | 867 | +104 | +16 | | Metric (in thousands) | Q2 2025 | Q2 2024 | Q1 2025 | YoY Change (Q2 25 vs Q2 24) | QoQ Change (Q2 25 vs Q1 25) | | :-------------------------------- | :------ | :------ | :------ | :-------------------------- | :-------------------------- | | Total Revenue | $5,621 | $6,020 | $5,476 | -7% | +3% | | Gross Margin | $4,285 | $4,647 | $4,273 | -8% | +0.3% | | Gross Margin (% of revenue) | 76% | 77% | 78% | -1 pp | -2 pp | | Operating Loss | $(249) | $(531) | N/A | -53% | N/A | | Net Loss from continuing operations (GAAP) | $(239) | $(683) | N/A | -65% | N/A | | Net Loss from discontinued operations (GAAP) | $(236) | $690 | N/A | N/A | N/A | | Operating Cash Flows | $135 | $(190) | N/A | N/A | N/A | | Adjusted EBITDA | $836 | $528 | N/A | +58% | N/A | | Adjusted EBITDA (% of revenue) | 15% | 9% | N/A | +6 pp | N/A | | Non-GAAP Net Income | $556 | $101 | N/A | +450% | N/A | | Adjusted Free-Cash Flow | $250 | $(292) | N/A | N/A | N/A | - The year-over-year revenue decrease was due to slight declines across all product lines, including a **4% decrease in core press release business revenue per release**, despite increased volume[6](index=6&type=chunk) - Operating expenses decreased by **12%** due to headcount reduction and other operational efficiency initiatives, contributing to a reduced operating loss[6](index=6&type=chunk) [First Half 2025 Highlights](index=2&type=section&id=First%20Half%202025%20Highlights) For the first half of 2025, ACCESS Newswire experienced a slight revenue decrease year-over-year but significantly improved its operating loss, net loss from continuing operations, and all non-GAAP financial measures | Metric (in thousands) | H1 2025 | H1 2024 | YoY Change (H1 25 vs H1 24) | | :-------------------------------- | :------ | :------ | :-------------------------- | | Total Revenue | $11,097 | $11,592 | -4% | | Gross Margin | $8,557 | $8,831 | -3% | | Gross Margin (% of revenue) | 77% | 76% | +1 pp | | Operating Loss | $(926) | $(1,393) | -34% | | Net Loss from continuing operations (GAAP) | $(1,004) | $(1,466) | -32% | | Net Income from discontinued operations (GAAP) | $5,916 | $1,334 | +343% | | Operating Cash Flows | $882 | $796 | +11% | | Adjusted EBITDA | $1,400 | $415 | +237% | | Adjusted EBITDA (% of revenue) | 13% | 4% | +9 pp | | Non-GAAP Net Income | $762 | $(265) | N/A (shifted from loss to income) | | Adjusted Free-Cash Flow | $1,217 | $491 | +148% | - The increase in net income from discontinued operations was primarily due to a **$6.0 million gain** recorded on the sale of the compliance business[10](index=10&type=chunk) - Improvements in non-GAAP measures are largely attributed to cost improvements and operational efficiencies[10](index=10&type=chunk) [Key Performance Indicators](index=2&type=section&id=Key%20Performance%20Indicators) The company reported a slight decrease in total active contracts but a notable increase in subscription customers and average annual recurring revenue (ARR) per subscription customer year-over-year | Metric | As of June 30, 2025 | As of June 30, 2024 | YoY Change | | :-------------------------------- | :------------------ | :------------------ | :--------- | | Total active contracts (past 12 months) | 11,770 | 12,112 | -342 | | Subscription customers | 971 | 867 | +104 | | Average ARR for subscriptions per customer | $11,039 | $10,068 | +$971 | Non-GAAP Financial Measures [Explanation of Non-GAAP Measures](index=2&type=section&id=Explanation%20of%20Non-GAAP%20Measures) Management uses non-GAAP financial measures to aid in financial and operational decision-making and to evaluate operating results over time, excluding certain non-recurring items for a more meaningful comparison of ongoing operations - Non-GAAP measures are used by management for financial and operational decision-making and evaluating operating results over time[9](index=9&type=chunk) - EBITDA excludes depreciation, amortization, interest, and income taxes from continuing operations[11](index=11&type=chunk) - Adjusted EBITDA further excludes certain non-recurring expenses and gain/loss on interest rate swaps[11](index=11&type=chunk) - Non-GAAP net income (loss) excludes stock-based compensation and amortization of acquisition-related intangible assets[11](index=11&type=chunk) - Free cash flow represents cash flow from operating activities less capital expenditures, while adjusted free cash flow also deducts certain non-recurring cash payments[12](index=12&type=chunk) - The company cautions that non-GAAP measures are not prepared in accordance with GAAP, may differ from those used by other companies, and exclude expenses that could materially impact reported financial results[13](index=13&type=chunk)[14](index=14&type=chunk) [Reconciliation of EBITDA & Adjusted EBITDA](index=3&type=section&id=CALCULATION%20OF%20EBITDA%20%26%20ADJUSTED%20EBITDA) The reconciliation tables show a significant improvement in both EBITDA and Adjusted EBITDA for Q2 and the first half of 2025 compared to the prior year periods, reflecting the impact of operational efficiencies and adjustments for non-recurring items **EBITDA & Adjusted EBITDA Reconciliation (in thousands):** | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | | Net loss from continuing operations | $(239) | $(683) | | EBITDA from continuing operations | $480 | $211 | | Adjusted EBITDA from continuing operations | $836 | $528 | | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :----------------------------- | :----------------------------- | | Net loss from continuing operations | $(1,004) | $(1,466) | | EBITDA from continuing operations | $476 | $282 | | Adjusted EBITDA from continuing operations | $1,400 | $415 | - Adjustments for acquisition/integration costs, other non-recurring expenses, and stock-based compensation significantly contributed to the difference between EBITDA and Adjusted EBITDA[15](index=15&type=chunk)[16](index=16&type=chunk) [Reconciliation of Non-GAAP Net Income (Loss)](index=4&type=section&id=CALCULATION%20OF%20NON-GAAP%20NET%20INCOME%20(LOSS)) The company reported a positive non-GAAP net income for both Q2 and the first half of 2025, a substantial improvement from net losses in the prior year periods, achieved by adjusting for amortization of intangible assets, stock-based compensation, and other unusual items **Non-GAAP Net Income (Loss) Reconciliation (in thousands, except per share):** | Metric | Three Months Ended June 30, 2025 | Per diluted share | Three Months Ended June 30, 2024 | Per diluted share | | :-------------------------------- | :------------------------------- | :---------------- | :------------------------------- | :---------------- | | Net loss from continuing operations | $(239) | $(0.06) | $(683) | $(0.18) | | Non-GAAP net income (loss) from continuing operations | $556 | $0.14 | $10

[PART I – FINANCIAL INFORMATION](index=2&type=section&id=PART%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) This part presents ACCESS Newswire Inc.'s unaudited consolidated financial statements and related notes for Q1 2025 and 2024 [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements%2E) This section details ACCESS Newswire Inc.'s unaudited consolidated financial statements and comprehensive notes for Q1 2025 and 2024 [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets%20as%20of%20March%2031%2C%202025%20%28Unaudited%29%20and%20December%2031%2C%202024) This section presents the unaudited consolidated balance sheets for ACCESS Newswire Inc. as of March 31, 2025, and December 31, 2024 Consolidated Balance Sheet Highlights (in thousands) | Metric | March 31, 2025 | December 31, 2024 | Change (vs. Dec 31, 2024) | | :------------------------------------------------ | :------------- | :---------------- | :------------------------ | | **Assets:** | | | | | Cash and cash equivalents | $4,100 | $4,103 | -$3 | | Accounts receivable (net) | $3,489 | $3,351 | +$138 | | Total current assets | $10,137 | $10,026 | +$111 | | Total assets | $47,283 | $50,638 | -$3,355 | | **Liabilities:** | | | | | Accounts payable | $1,655 | $1,423 | +$232 | | Income tax payable | $3,787 | $56 | +$3,731 | | Current portion of long-term debt | $870 | $4,000 | -$3,130 | | Total current liabilities | $13,473 | $12,814 | +$659 | | Long-term debt (net) | $2,326 | $11,930 | -$9,604 | | Total liabilities | $16,388 | $25,412 | -$9,024 | | **Stockholders' Equity:** | | | | | Retained earnings | $6,528 | $1,141 | +$5,387 | | Total stockholders' equity | $30,895 | $25,226 | +$5,669 | [Consolidated Statements of Operations](index=4&type=section&id=Unaudited%20Consolidated%20Statements%20of%20Operations%20for%20the%20Three%20Months%20Ended%20March%2031%2C%202025%20and%202024) This section presents the unaudited consolidated statements of operations for the three months ended March 31, 2025 and 2024 Consolidated Statements of Operations Highlights (in thousands) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | Change (YoY) | | :------------------------------------ | :-------------------------------- | :-------------------------------- | :----------- | | Revenues | $5,476 | $5,572 | -$96 | | Cost of revenues | $1,203 | $1,388 | -$185 | | Gross profit | $4,273 | $4,184 | +$89 | | Total operating costs and expenses | $4,950 | $5,046 | -$96 | | Operating loss | $(677) | $(862) | +$185 | | Net income (loss) | $5,387 | $(139) | +$5,526 | | Net income per share – basic | $1.40 | $(0.04) | +$1.44 | | Net income per share – fully diluted | $1.40 | $(0.04) | +$1.44 | [Consolidated Statements of Comprehensive Income (Loss)](index=5&type=section&id=Unaudited%20Consolidated%20Statements%20of%20Comprehensive%20%28Loss%29%20Income%20for%20the%20Three%20Months%20Ended%20March%2031%2C%202025%20and%202024) This section presents the unaudited consolidated statements of comprehensive income (loss) for the three months ended March 31, 2025 and 2024 Consolidated Statements of Comprehensive Income (Loss) (in thousands) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :-------------------------------- | :-------------------------------- | :-------------------------------- | | Net income (loss) | $5,387 | $(139) | | Foreign currency translation adjustment | $2 | $(34) | | Comprehensive income (loss) | $5,389 | $(173) | [Consolidated Statements of Stockholders' Equity](index=6&type=section&id=Unaudited%20Consolidated%20Statement%20of%20Stockholders%27%20Equity%20for%20the%20Three%20Months%20Ended%20March%2031%2C%202025%20and%202024) This section presents the unaudited consolidated statements of stockholders' equity for the three months ended March 31, 2025 and 2024 Consolidated Statements of Stockholders' Equity Highlights (in thousands) | Metric | Balance at Dec 31, 2024 | Stock-based Comp. Expense | Foreign Currency Translation | Net Income | Balance at Mar 31, 2025 | | :----------------------- | :---------------------- | :------------------------ | :--------------------------- | :--------- | :---------------------- | | Common Stock Amount | $4 | $0 | $0 | $0 | $4 | | Additional Paid-in Capital | $24,259 | $280 | $0 | $0 | $24,539 | | Other Accumulated Comp. Loss | $(178) | $0 | $2 | $0 | $(176) | | Retained Earnings | $1,141 | $0 | $0 | $5,387 | $6,528 | | Total Stockholders' Equity | $25,226 | $280 | $2 | $5,387 | $30,895 | [Consolidated Statements of Cash Flows](index=7&type=section&id=Unaudited%20Consolidated%20Statements%20of%20Cash%20Flows%20for%20the%20Three%20Months%20Ended%20March%2031%2C%202025%20and%202024) This section presents the unaudited consolidated statements of cash flows for the three months ended March 31, 2025 and 2024 Consolidated Statements of Cash Flows Highlights (in thousands) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :------------------------------------------ | :-------------------------------- | :-------------------------------- | | Net cash provided by operating activities | $747 | $986 | | Net cash provided by (used in) investing activities | $11,965 | $(261) | | Net cash used in financing activities | $(12,739) | $(1,000) | | Net change in cash and cash equivalents | $(27) | $(275) | | Cash and cash equivalents – ending | $4,100 | $5,399 | - Net cash provided by investing activities significantly increased to **$11,965,000** in Q1 2025, primarily due to **$12,000,000** in proceeds from the sale of the Compliance Business[24](index=24&type=chunk) - Net cash used in financing activities increased substantially to **$12,739,000** in Q1 2025, mainly due to a **$12,739,000** payment of long-term debt[24](index=24&type=chunk) [Notes to Unaudited Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Unaudited%20Consolidated%20Financial%20Statements) This section provides detailed notes supporting the unaudited consolidated financial statements for ACCESS Newswire Inc [Note 1. Basis of Presentation](index=8&type=section&id=Note%201.%20Basis%20of%20Presentation) This note outlines the basis for preparing the unaudited interim financial statements in accordance with Form 10-Q and Regulation S-X - The unaudited interim financial statements are prepared in accordance with Form 10-Q and Article 10 of Regulation S-X, including all normal recurring adjustments for fair presentation. They should be read in conjunction with the 2024 audited financial statements filed on Form 10-K[26](index=26&type=chunk) [Note 2. Summary of Significant Accounting Policies](index=8&type=section&id=Note%202.%20Summary%20of%20Significant%20Accounting%20Policies) This note details the significant accounting policies, including those for credit losses, revenue recognition, deferred revenue, and capitalized software - The Company calculates its allowance for credit losses using an expected losses model based on historical customer data and current economic trends[29](index=29&type=chunk) Allowance for Credit Losses (in thousands) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :------------------------ | :-------------------------------- | :-------------------------------- | | Beginning balance | $1,059 | $721 | | Provision for credit losses | $277 | $300 | | Write-offs | $(15) | $(241) | | Ending balance | $1,321 | $780 | - Revenue is primarily derived from press release distribution, investor relations website hosting, data feeds, events, webcasts, and incident hotline subscriptions. Contracts are generally for one year with automatic renewal[34](index=34&type=chunk)[35](index=35&type=chunk) - Deferred revenue as of March 31, 2025, was **$5,021,000**, an increase from **$4,743,000** at December 31, 2024, and is expected to be recognized primarily within one year[38](index=38&type=chunk) - Capitalized software development costs were **$23,000** for Q1 2025, significantly down from **$245,000** in Q1 2024. Amortization included in cost of revenues increased to **$73,000** from **$46,000** YoY[44](index=44&type=chunk) - The Company incurred **$132,000** in costs associated with its corporate re-brand during the three months ended March 31, 2025[56](index=56&type=chunk) [Note 3: Discontinued Operations](index=10&type=section&id=Note%203%3A%20Discontinued%20Operations) This note details the sale of the Company's compliance business and its classification as discontinued operations - On February 28, 2025, the Company sold certain assets related to its compliance business to Equiniti Trust Company, LLC. These assets and associated revenues/expenses are classified as discontinued operations[61](index=61&type=chunk)[62](index=62&type=chunk) Assets and Liabilities of Discontinued Operations (in thousands) | Metric | March 31, 2025 | December 31, 2024 | | :------------------------------------------------------------------------------------------------ | :------------- | :---------------- | | **Assets:** | | | | Accounts Receivable (net) | $633 | $1,321 | | Goodwill | — | $2,885 | | Intangible Assets (net) | — | $637 | | Total assets | $633 | $4,915 | | **Liabilities:** | | | | Accounts Payable | — | $107 | | Accrued Expenses | — | $168 | | Deferred Revenue | — | $618 | | Total liabilities | — | $893 | Income from Discontinued Operations (in thousands) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :-------------------------------- | :-------------------------------- | :-------------------------------- | | Revenues | $650 | $1,390 | | Gross margin | $335 | $963 | | Operating income | $150 | $809 | | Gain on disposal of compliance business | $8,974 | — | | Net income from discontinued operations | $6,152 | $644 | [Note 4: Equity](index=11&type=section&id=Note%204%3A%20Equity) This note provides information on the Company's equity, including stock options, restricted stock units, and unrecognized compensation costs - No dividends were paid during the three months ended March 31, 2025 and 2024[66](index=66&type=chunk) - As of March 31, 2025, **366,078 shares** remain to be granted under the 2023 Equity Incentive Plan[68](index=68&type=chunk) Stock Options Outstanding and Exercisable at March 31, 2025 | Exercise Price Range | Number of Options Outstanding | Weighted Average Remaining Contractual Life (in Years) | Weighted Average Exercise Price | Number of Options Exercisable | | :------------------- | :---------------------------- | :----------------------------------------------------- | :------------------------------ | :---------------------------- | | $0.01 - 8.00 | 5,000 | 0.64 | $6.80 | 5,000 | | $8.01 - 11.00 | 1,000 | 4.25 | $10.75 | 1,000 | | $11.01 - 16.00 | 10,000 | 3.92 | $13.21 | 10,000 | | $16.01 - 27.00 | 30,000 | 7.76 | $26.98 | 15,000 | | $27.01 - 27.71 | 12,750 | 6.80 | $27.71 | 12,750 | | **Total** | **58,750** | **6.23** | **$22.80** | **43,750** | - Unrecognized stock compensation related to options was **$183,000** as of March 31, 2025, to be recognized through 2027. Unrecognized compensation cost for unvested restricted stock units was **$575,000**, to be recognized through 2026[69](index=69&type=chunk)[70](index=70&type=chunk) [Note 5: Income Taxes](index=12&type=section&id=Note%205%3A%20Income%20Taxes) This note details the income tax benefit and the factors influencing the variance from the U.S. statutory tax rate Income Tax Benefit (in thousands) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :----------------- | :-------------------------------- | :-------------------------------- | | Income tax benefit | $185 | $158 | - The variance from the U.S. statutory rate of **21%** is primarily due to state income tax, Foreign Derived Intangible Income (FDII) deduction, and a lower Canadian statutory tax rate, partially offset by stock-based compensation expense[71](index=71&type=chunk) [Note 6: Leases](index=12&type=section&id=Note%206%3A%20Leases) This note provides information on the Company's lease liabilities, lease expenses, and weighted-average lease terms - Lease liabilities totaled **$973,000** as of March 31, 2025, with a current portion of **$392,000** and a long-term portion of **$581,000**[73](index=73&type=chunk) Lease Expense (in thousands) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :-------------------- | :-------------------------------- | :-------------------------------- | | Operating lease expense | $76 | $76 | | Variable lease expense | $15 | $14 | | Rent expense | $91 | $90 | - The weighted-average remaining non-cancelable lease term for operating leases was **2.75 years** as of March 31, 2025, with a weighted-average discount rate of **3.77%**[74](index=74&type=chunk) [Note 7: Segment Reporting](index=13&type=section&id=Note%207%3A%20Segment%20Reporting) This note clarifies that the Company operates as a single reportable segment, focusing on communications for public and private entities - The Company operates as a single reportable segment, identified as a communications company for publicly traded and private companies. The CEO acts as the Chief Operating Decision Maker (CODM)[75](index=75&type=chunk) Segment Operating Results (in thousands) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :-------------------------------- | :-------------------------------- | :-------------------------------- | | Revenues | $5,476 | $5,572 | | Total cost of revenue | $1,203 | $1,388 | | Total operating costs and expenses | $4,950 | $5,046 | | Operating loss | $(677) | $(862) | [Note 8: Credit Agreement](index=14&type=section&id=Note%208%3A%20Credit%20Agreement) This note details the Third Modification to the Credit Agreement, including the reduction in Term Loan principal and amended financial covenants - On February 28, 2025, the Company entered into a Third Modification to Credit Agreement, reducing the Term Loan principal balance by **$12,000,000** to **$3,333,333** following the sale of the Compliance Business[80](index=80&type=chunk)[81](index=81&type=chunk) - Monthly principal payments for the Term Loan were reduced from **$333,333** to **$72,464**, effective March 1, 2025[81](index=81&type=chunk) Amended Financial Covenants (Effective June 30, 2025) | Covenant | Ratio | | :------------------------ | :------ | | Fixed Charge Coverage Ratio | 1.2:1.0 | | Leverage Ratio | 2.25:1.0 | Unrestricted Liquidity Requirements Based on Leverage Ratio | Leverage Ratio | Unrestricted Liquidity | | :------------------------------------------------ | :--------------------- | | Less than or equal to 1.5:1.00 | $1,500,000 | | Greater than 1.5:1.00 but less than or equal to 1.75:1.00 | $1,000,000 | | Greater than 1.75:1.00 | $500,000 | [Note 9: Interest Rate Swap](index=15&type=section&id=Note%209%3A%20Interest%20Rate%20Swap) This note describes the Company's interest rate swap agreement, its fair value, and the recognized unrealized gains or losses - The Company uses an interest rate swap to convert variable rate debt to a fixed rate of **6.217%**. As of March 31, 2025, the variable rate was **6.68%**[87](index=87&type=chunk) - The fair value of the swap agreement was a liability of **$8,000** as of March 31, 2025, compared to an asset of **$60,000** as of December 31, 2024[89](index=89&type=chunk) - A net unrealized loss of **$69,000** was recognized from the interest rate swap during Q1 2025, compared to a net unrealized gain of **$205,000** in Q1 2024[89](index=89&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=19&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations%2E) This section analyzes ACCESS Newswire Inc.'s financial condition, operational results, and future outlook, including rebranding and compliance business sale [Overview](index=19&type=section&id=Overview) This section provides an overview of ACCESS Newswire Inc.'s rebranding, platform offerings, and subscription model - Effective January 27, 2025, the company changed its name from Issuer Direct Corporation to ACCESS Newswire Inc[93](index=93&type=chunk) - ACCESS Newswire offers a dynamic customer platform streamlining Public Relations (PR) and Investor Relations (IR) for businesses, distributing messaging to stakeholders globally[96](index=96&type=chunk) - Core products include Press Release Distribution, Media Monitoring, Database and Pitching, Investor Relations Websites, and Earnings and Event technologies[97](index=97&type=chunk) - As of March 31, 2025, the company had **955 subscriptions** with an Annual Recurring Revenue (ARR) of approximately **$10.6 million**, following the launch of its new subscription platform in late 2024/early 2025[98](index=98&type=chunk) [Sale of our Compliance Business](index=19&type=section&id=Sale%20of%20our%20Compliance%20Business) This section details the sale of the Company's compliance business assets to Equiniti Trust Company, LLC, and its financial classification - On February 28, 2025, the Company sold certain assets of its compliance business to Equiniti Trust Company, LLC. This included disclosure software, stock transfer services, annual meeting services, and virtual annual meeting services (excluding IP)[99](index=99&type=chunk) - Revenue from SEDAR services and the whistleblower hotline will be retained by the Company[99](index=99&type=chunk) - Assets and associated revenues/expenses of the sold compliance business are categorized as discontinued operations in the financial statements[99](index=99&type=chunk) [Our Platform](index=19&type=section&id=Our%20Platform) This section describes the Company's consolidated product offerings, ACCESS PR, ACCESS IR, and ALL ACCESS, following its rebrand - As part of its rebrand in January 2025, the Company consolidated product naming conventions and subscriptions into three main offerings: ACCESS PR, ACCESS IR, and ALL ACCESS[100](index=100&type=chunk)[101](index=101&type=chunk)[102](index=102&type=chunk) - Customers can also purchase stand-alone solutions on a pay-as-you-go option before subscribing to the platform[102](index=102&type=chunk) [Products in the Platform](index=20&type=section&id=Products%20in%20the%20Platform) This section outlines the various products within the ACCESS Newswire platform, including press release distribution, media monitoring, and investor relations tools - Press Release Distribution offers comprehensive news dissemination with self-publishing or AI-assisted creation, reviewed by an editorial team, integrated into all three ACCESS subscription plans for 2025[103](index=103&type=chunk)[105](index=105&type=chunk) - Press Release Optimizer (PRO) automates media and marketing communications, providing content and media services to optimize content and increase media visibility, and can be added to any ACCESS subscription[106](index=106&type=chunk) - Media Database & Pitching features a curated database of active journalists, with an AI writing and recommendation engine (AIMee) to enhance pitches[107](index=107&type=chunk)[108](index=108&type=chunk) - Media Monitoring is a brand monitoring solution covering print, broadcast, web, radio, video, blogs, and social media, with plans for expansion[109](index=109&type=chunk) - Media Room is an add-on product including a custom newsroom page builder, brand asset manager, and contact manager, designed to build connections with media and the investment community[110](index=110&type=chunk)[111](index=111&type=chunk) - Webcasting & Events is a cloud-based platform for live and on-demand streaming of earnings calls, virtual meetings, and other events, integrating earnings announcements and press releases for a full-service solution[112](index=112&type=chunk)[113](index=113&type=chunk)[114](index=114&type=chunk) - Professional Conference and Events Software is a subscription offering for investor conference organizers, available as a mobile app, integrating registration, meeting management, event promotion, and lodging[115](index=115&type=chunk) - Investor Relations Websites is a content network providing data feeds (news, stock, fundamentals, regulatory filings) for company websites, integrated with other offerings for automatic content linking and distribution[116](index=116&type=chunk) - Incident Hotline is an add-on product delivering secure notifications and basic incident workflow management, supported and subsidized by NYSE offerings[118](index=118&type=chunk) [Results of Operations](index=22&type=section&id=Results%20of%20Operations) This section analyzes the Company's financial performance for Q1 2025 compared to Q1 2024, covering revenues, costs, and expenses Key Financial Performance (in thousands, except percentages) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | Change (YoY) | % of Revenue 2025 | % of Revenue 2024 | | :-------------------------------- | :-------------------------------- | :-------------------------------- | :----------- | :------------------ | :------------------ | | Revenues | $5,476 | $5,572 | -$96 | | | | Cost of revenues | $1,203 | $1,388 | -$185 | 22% | 25% | | Gross margin | $4,273 | $4,184 | +$89 | 78% | 75% | | Total operating expenses | $4,950 | $5,046 | -$96 | 90% | 90% | | Operating loss | $(677) | $(862) | +$185 | (12)% | (15)% | | Net (loss) from continuing operations | $(765) | $(783) | +$18 | (14)% | (14)% | - Total revenue decreased by **2%** YoY to **$5,476,000**, primarily due to slight declines across various product lines, though core press release business revenue increased by **1%** due to higher volume[121](index=121&type=chunk) - Deferred revenue increased by **6%** to **$5,021,000** as of March 31, 2025, compared to **$4,743,000** at December 31, 2024[122](index=122&type=chunk) - Cost of revenues decreased by **13%** YoY, leading to an increase in gross margin percentage to **78%** in Q1 2025 from **75%** in Q1 2024[123](index=123&type=chunk) - General and administrative expenses increased by **19%** YoY to **$1,953,000**, mainly due to a **$340,000** benefit to stock compensation expense in the prior year from an executive's resignation[124](index=124&type=chunk) - Sales and marketing expenses decreased by **23%** YoY to **$1,594,000**, driven by lower employee-related and advertising expenses[126](index=126&type=chunk) - Product development expenses increased by **12%** YoY to **$733,000**, primarily due to lower capitalization of software (**$23,000** in Q1 2025 vs. **$245,000** in Q1 2024), partially offset by increased headcount[128](index=128&type=chunk) - Net interest expense decreased to **$214,000** in Q1 2025 from **$308,000** in Q1 2024[130](index=130&type=chunk) - Other income (expense) represents the change in fair value of the interest rate swap, resulting in a net unrealized loss of **$69,000** in Q1 2025[131](index=131&type=chunk)[89](index=89&type=chunk) [Liquidity and Capital Resources](index=23&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses the Company's cash position, accounts receivable, current liabilities, and future liquidity outlook - As of March 31, 2025, cash and cash equivalents were **$4,100,000**, and net accounts receivable were **$3,489,000**[133](index=133&type=chunk) - Current liabilities from continuing operations exceeded current assets by **$3,336,000** as of March 31, 2025[134](index=134&type=chunk) - Management believes its ability to renegotiate the Credit Agreement and generate cash will benefit future liquidity[134](index=134&type=chunk) [Disclosure about Off-Balance Sheet Arrangements](index=23&type=section&id=Disclosure%20about%20Off-Balance%20Sheet%20Arrangements) This section confirms the Company has no material off-balance sheet arrangements impacting stockholders - The Company has no off-balance sheet arrangements that are material to stockholders[135](index=135&type=chunk)[150](index=150&type=chunk) [Non-GAAP Measures](index=23&type=section&id=Non-GAAP%20Measures) This section presents and reconciles non-GAAP financial measures used by management to assess performance and cash generation - Management uses non-GAAP measures like free cash flow, adjusted free cash flow, adjusted EBITDA, and adjusted net income to assess financial performance and cash generation, believing they offer useful insights into core business operations[136](index=136&type=chunk)[137](index=137&type=chunk) Free Cash Flow and Adjusted Free Cash Flow from Continuing Operations (Non-GAAP, in thousands) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :---------------------------------------------------- | :-------------------------------- | :-------------------------------- | | Net cash provided by operating activities of continuing operations (GAAP) | $809 | $77 | | Payments for purchase of fixed assets and capitalized software | $(35) | $(261) | | Free cash flow from continuing operations (Non-GAAP) | $774 | $(184) | | Cash paid for acquisition and integration related items | $87 | $23 | | Cash paid for other unusual items | $168 | $35 | | Adjusted free cash flow from continuing operations (Non-GAAP) | $1,029 | $(126) | Reconciliation of Net Loss to Adjusted EBITDA from Continuing Operations (Non-GAAP, in thousands) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :------------------------------------------ | :-------------------------------- | :-------------------------------- | | Net loss from continuing operations | $(765) | $(783) | | Depreciation and amortization | $742 | $728 | | Interest expense, net | $204 | $284 | | Income tax expense (benefit) | $(185) | $16 | | EBITDA from continuing operations | $(4) | $245 | | Acquisition and/or integration costs | $129 | $65 | | Other non-recurring expenses | $236 | $(170) | | Stock-based compensation expense | $203 | $(79) | | Adjusted EBITDA from continuing operations | $564 | $61 | Reconciliation of Net Loss to Non-GAAP Net Income (Loss) from Continuing Operations (in thousands, except per share) | Metric | Three Months Ended March 31, 2025 (Amount) | Three Months Ended March 31, 2025 (Per diluted share) | Three Months Ended March 31, 2024 (Amount) | Three Months Ended March 31, 2024 (Per diluted share) | | :---------------------------------------------------- | :----------------------------------------- | :---------------------------------------------------- | :----------------------------------------- | :---------------------------------------------------- | | Net loss from continuing operations | $(765) | $(0.20) | $(783) | $(0.21) | | Amortization of intangible assets | $630 | $0.16 | $643 | $0.17 | | Stock-based compensation expense | $203 | $0.05 | $(79) | $(0.02) | | Other unusual items | $365 | $0.09 | $(105) | $(0.03) | | Discrete items impacting income tax expense | $25 | $0.01 | $55 | $0.01 | | Tax impact of adjustments | $(252) | $(0.06) | $(96) | $(0.02) | | Non-GAAP net income (loss) from continuing operations | $206 | $0.05 | $(365) | $(0.10) | | Weighted average number of common shares outstanding – diluted | 3,843 | | 3,821 | | [Outlook](index=24&type=section&id=Outlook) This section discusses the Company's strategic initiatives and expectations for sustainable growth despite global uncertainties - Despite global economic and political uncertainties, the Company believes demand for its platforms and services remains stable in most markets[147](index=147&type=chunk) - The continued transition to a platform subscription model is key for long-term sustainable growth[148](index=148&type=chunk) - Key strategic initiatives for the remainder of 2025 include: * Expanding products and adapting to industry changes * Expanding customer base and newswire distribution * Investing in technology advancements and upgrades * Evaluating acquisitions in strategic focus areas * Generating profitable sustainable growth and cash flows from operations[148](index=148&type=chunk)[149](index=149&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=26&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk%2E) This section states that there are no applicable quantitative and qualitative disclosures about market risk for the Company - Not applicable[151](index=151&type=chunk) [Item 4. Controls and Procedures](index=26&type=section&id=Item%204.%20Controls%20and%20Procedures%2E) The Company's CEO and CFO concluded disclosure controls are effective and unchanged since the last annual report - The Company's CEO and CFO concluded that disclosure controls and procedures are effective and have not materially changed since the last annual report[152](index=152&type=chunk) [PART II – OTHER INFORMATION](index=27&type=section&id=PART%20II%20%E2%80%93%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, equity sales, defaults, mine safety, other information, and exhibits [Item 1. Legal Proceedings](index=27&type=section&id=Item%201.%20Legal%20Proceedings%2E) The Company is not a party to any litigation that would materially adversely affect its business - The Company is not a party to any litigation, nor is it aware of any threatened or pending litigation that might result in a material adverse effect on its business[153](index=153&type=chunk) [Item 1A. Risk Factors](index=27&type=section&id=Item%201A.%20Risk%20Factors%2E) No material changes to risk factors have occurred since the most recent Form 10-K filing - No material changes to risk factors since the most recent Form 10-K filing[154](index=154&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=27&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds%2E) No unregistered sales of equity securities or use of proceeds were reported during the period - None[155](index=155&type=chunk) [Item 3. Defaults Upon Senior Securities](index=27&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities%2E) No defaults upon senior securities were reported during the period - None[156](index=156&type=chunk) [Item 4. Mine Safety Disclosure](index=27&type=section&id=Item%204.%20Mine%20Safety%20Disclosure%2E) This section is not applicable to the Company - Not applicable[157](index=157&type=chunk) [Item 5. Other Information](index=27&type=section&id=Item%205.%20Other%20Information%2E) No director or officer trading arrangements were adopted, modified, or terminated in Q1 2025 - No director or officer adopted, modified, or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement" during the three months ended March 31, 2025[158](index=158&type=chunk) [Item 6. Exhibits](index=28&type=section&id=Item%206.%20Exhibits%2E) This section lists the exhibits filed or furnished with the Form 10-Q, including certifications and XBRL documents Exhibits Filed | Exhibit Number | Description | | :------------- | :-------------------------------------------------------------------------------- | | 31.1 | Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.* | | 31.2 | Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.* | | 32.1 | Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.* | | 32.2 | Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.* | | 101.INS | XBRL Instance Document.** | | 101.SCH | XBRL Taxonomy Extension Schema Document.** | | 101.CAL | XBRL Taxonomy Calculation Linkbase Document.** | | 101.LAB | XBRL Taxonomy Label Linkbase Document.** | | 101.PRE | XBRL Taxonomy Presentation Linkbase Document.** | | 101.DEF | XBRL Taxonomy Extension Definition Linkbase Document. ** | [Signatures](index=29&type=section&id=Signatures) The report was signed by ACCESS Newswire, Inc.'s CEO and CFO on May 13, 2025 - The report was signed by Brian R. Balbirnie (CEO) and Steven Knerr (CFO) on May 13, 2025[162](index=162&type=chunk)

Revenue Performance - Revenue decreased 2% to $5.5 million compared to $5.6 million in Q1 2024[5] - Total revenues for the three months ended March 31, 2025, were $5,476,000, a decrease of 1.7% compared to $5,572,000 for the same period in 2024[33] Profitability Metrics - Adjusted EBITDA increased to $564,000, representing 10% of revenue, compared to $61,000, or 1% of revenue, in Q1 2024[6] - Operating loss decreased to $677,000 in Q1 2025 from $862,000 in Q1 2024[6] - The net income for the three months ended March 31, 2025, was $5,387,000, compared to a net loss of $139,000 for the same period in 2024[33] Cash Flow - Cash flow from operations increased to $809,000 from $77,000 in Q1 2024[5] - Adjusted free cash flow was $1,029,000 for Q1 2025 compared to $(126,000) for Q1 2024[18] - The company reported a net cash provided by operating activities of continuing operations of $809,000 for the three months ended March 31, 2025[35] Customer Metrics - Subscription customers increased by 9% year-over-year, reaching 955 from 874 in Q1 2024[3] - Average Annual Recurring Revenue (ARR) per subscription customer rose to $11,139, up from $9,300 as of March 31, 2024[13] - The company aims to have 80% of its revenue come from subscription customers by the end of 2025[26] Gross Margin - Gross margin improved to 78% of revenue, up from 75% in Q1 2024[6] - Gross profit for the same period was $4,273,000, reflecting a gross margin of 77.9%[33] Business Transactions - The company sold its Compliance business for $12.5 million on February 28, 2025[5] - The sale of the Compliance business generated $12,000,000 in proceeds, positioning the company for focused growth as a standalone Communications platform[35] Balance Sheet - Total current assets as of March 31, 2025, were $10,137,000, slightly up from $10,026,000 as of December 31, 2024[29] - Total liabilities decreased to $16,388,000 as of March 31, 2025, from $25,412,000 as of December 31, 2024[31] Future Outlook - The company expects faster growth in the upcoming quarters following the strategic sale of its Compliance business[26] - The weighted average number of common shares outstanding was 3,842,000 for the three months ended March 31, 2025[33]

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]