Financial Performance - Third quarter 2025 total revenues reached $21.6 million, reflecting a 41.6% year-over-year growth[4] - Adjusted EBITDA for Q3 2025 was $5.04 million, up 78.1% from the previous year, representing 23.3% of revenues[4] - Net income improved by 54.2% to $2.22 million, with diluted earnings per share increasing to $0.04[4] - Total revenues for Q3 2025 reached $21,596,478, a 41.6% increase from $15,256,431 in Q3 2024[21] - Net income for Q3 2025 was $2,215,135, compared to $1,436,837 in Q3 2024, reflecting a 54.1% year-over-year increase[21] - Adjusted EBITDA for the nine months ended September 30, 2025, was $14,512,453, up from $6,756,410 in 2024, indicating a growth of 115%[26] - The Adjusted EBITDA margin for the three months ended September 30, 2025, was 23.3%, compared to 18.5% in 2024, reflecting an increase of 4.8 percentage points[28] - The EBITDA margin for the nine months ended September 30, 2025, was 19.6%, up from 11.3% in 2024, showing an improvement of 8.3 percentage points[28] - Basic Adjusted EBITDA per share for the nine months ended September 30, 2025, was $0.27, compared to $0.13 in 2024, representing a 108% increase[26] - The net income margin for the three months ended September 30, 2025, was 10.3%, compared to 9.4% in 2024, reflecting an increase of 0.9 percentage points[28] Revenue Breakdown - Pharma patient affordability revenue surged 141.9% to $7.92 million, with 105 active programs, an increase of 39 programs year-over-year[4] - Plasma revenue increased 12.4% to $12.86 million, with 595 plasma centers, up 117 centers from the previous year[4] - Plasma industry revenue was $12,860,478, up from $11,439,534 in the same quarter last year, while pharma industry revenue surged to $7,920,604 from $3,274,888[21] Cash and Assets - The company ended the quarter with $7.53 million in unrestricted cash and zero bank debt[4] - Total assets as of September 30, 2025, were $209,509,085, up from $179,028,197 at the end of 2024[22] - Cash and cash equivalents decreased to $7,529,047 from $10,766,982 at the end of 2024[22] Future Outlook - Full-year 2025 total revenues are now estimated to be between $80.5 million and $81.5 million, reflecting a year-over-year growth of 38.7% at the midpoint[12] - Adjusted EBITDA for the full year is expected to be in the range of $19.0 million to $20.0 million, equating to an Adjusted EBITDA margin of 24.1%[12] - The company plans to add another 20-30 pharma patient affordability programs before year-end, indicating strong demand for its solutions[3] - The company expects to add 20-30 new programs by year-end, indicating strong demand for its solutions[14] - The company anticipates fourth quarter results to be similar to Q3, with flat plasma revenue and additional patient affordability programs[14] - The company is well-positioned to capitalize on growth opportunities in patient affordability and SaaS engagement technology solutions[14] Operational Improvements - The opening of a new customer service contact center has increased support capacity fourfold, preparing the company for significant growth in patient affordability[14] Other Financial Metrics - Stock-based compensation as a percentage of revenue for the three months ended September 30, 2025, was 5.9%, up from 3.8% in 2024, indicating a rise of 2.1 percentage points[28] - Interest income, net, for the nine months ended September 30, 2025, was $(2,031,024), compared to $(2,345,416) in 2024, showing a decrease of 13.4%[26] - Depreciation and amortization for the three months ended September 30, 2025, was $2,190,420, compared to $1,565,621 in 2024, representing an increase of 40%[26]

Core Insights - Two stocks in the financial sector are identified as potentially overbought, which may signal caution for momentum-focused investors [1][2] Group 1: Paysign Inc (NASDAQ:PAYS) - Paysign appointed Jose Garcia as executive vice president for Life Science Solutions, highlighting his expertise in the plasma collection and life sciences industries [7] - The stock of Paysign increased approximately 23% over the past month, reaching a 52-week high of $8.88 [7] - The Relative Strength Index (RSI) for Paysign is at 72.0, indicating it is overbought [7] - Shares of Paysign closed at $6.29 after a gain of 7.9% on Tuesday [7] - Paysign has a momentum score of 95.70 and a value score of 10.39 according to Edge Stock Ratings [7] Group 2: HSBC Holdings PLC (NYSE:HSBC) - HSBC announced its exit from retail banking operations in Sri Lanka, transferring about 200,000 customer accounts, credit cards, and consumer loans to Nations Trust Bank PLC [7] - The stock of HSBC gained around 11% over the past month, with a 52-week high of $71.06 [7] - The RSI for HSBC is at 72.9, also indicating it is overbought [7] - Shares of HSBC closed at $70.98 after a gain of 0.7% on Tuesday [7]

Core Insights - Two stocks in the financial sector are identified as potentially overbought, which may concern momentum-focused investors [1][2] Company Summaries Paysign Inc (NASDAQ:PAYS) - Recently appointed Jose Garcia as executive vice president for Life Science Solutions, highlighting his expertise in the plasma collection and life sciences industries [7] - The stock has increased approximately 23% over the past month, reaching a 52-week high of $8.88 [7] - Current RSI value is 72.0, indicating overbought conditions, with shares closing at $6.29 after a 7.9% gain [7] - Momentum score is 95.70, with a value score of 10.39 [7] HSBC Holdings PLC (NYSE:HSBC) - Announced plans to exit retail banking operations in Sri Lanka, transferring about 200,000 customer accounts and related services to Nations Trust Bank PLC [7] - The stock has gained around 11% over the past month, with a 52-week high of $71.06 [7] - Current RSI value is 72.9, also indicating overbought conditions, with shares closing at $70.98 after a 0.7% gain [7]

Core Insights - Paysign, Inc. reported a revenue increase of 33.12% year-over-year in Q2 2025, indicating strong business performance and growth potential for the upcoming periods [1]. Financial Performance - The company experienced a significant revenue growth of 33.12% YoY in Q2 2025, showcasing its robust financial health and operational efficiency [1]. Future Outlook - Paysign expressed optimism regarding its business prospects for the second half of 2025 and into 2026, highlighting the consistency of its results and potential for continued growth [1].

Core Insights - Paysign, Inc. has appointed Jose Garcia as Executive Vice President of Life Science Solutions, indicating a strategic move to enhance its leadership in this sector [1] Company Summary - The appointment of Jose Garcia is expected to strengthen Paysign's position in the life sciences market, reflecting the company's commitment to expanding its service offerings [1]

Core Points - The article discusses the summary notice regarding the pendency and proposed settlement of stockholder derivative actions [1] Group 1 - The notice outlines the status of stockholder derivative actions that are currently pending [1] - It provides details on the proposed settlement terms for the stockholder derivative actions [1] - The document aims to inform stockholders about their rights and the implications of the proposed settlement [1]

Core Insights - Paysign, Inc. has opened a new 30,000 square foot Patient Service Support Center to address the increasing demand in the patient affordability sector [1] Company Summary - The new facility aims to enhance the company's capabilities in providing support services related to patient affordability [1] - This expansion reflects the company's commitment to meeting the growing needs of patients and healthcare providers [1] Industry Context - The patient affordability business is experiencing significant growth, prompting companies like Paysign to invest in infrastructure to better serve this market [1]

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents Paysign, Inc.'s unaudited condensed consolidated financial statements, including balance sheets, statements of operations, statements of stockholders' equity, and statements of cash flows for the periods ended June 30, 2025, and December 31, 2024 (for balance sheet) or June 30, 2024 (for income statement and cash flow) [Condensed Consolidated Balance Sheets](index=3&type=section&id=PAYSIGN,%20INC.%20CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) This section provides a snapshot of the company's assets, liabilities, and equity at specific points in time Condensed Consolidated Balance Sheet Highlights (June 30, 2025 vs. December 31, 2024) | Metric | June 30, 2025 (Unaudited) | December 31, 2024 (Audited) | Change ($) | Change (%) | | :-------------------------------- | :------------------------ | :------------------------ | :--------- | :--------- | | Total assets | $193,896,201 | $179,028,197 | $14,868,004 | 8.31% | | Total current assets | $158,707,914 | $158,836,633 | $(128,719) | -0.08% | | Intangible assets, net | $23,682,758 | $12,239,717 | $11,443,041 | 93.50% | | Goodwill | $4,487,637 | $0 | $4,487,637 | N/A | | Total liabilities | $151,688,242 | $148,586,565 | $3,101,677 | 2.09% | | Total stockholders' equity | $42,207,959 | $30,441,632 | $11,766,327 | 38.65% | - The significant increase in intangible assets and the appearance of goodwill are primarily due to the acquisition of Gamma Innovation LLC on March 19, 2025[11](index=11&type=chunk)[40](index=40&type=chunk)[61](index=61&type=chunk) [Condensed Consolidated Statements of Operations](index=4&type=section&id=PAYSIGN,%20INC.%20CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) This section details the company's revenues, expenses, and net income over specific periods Condensed Consolidated Statements of Operations Highlights (Three Months Ended June 30) | Metric | 2025 | 2024 | Change ($) | Change (%) | | :-------------------------- | :--------- | :--------- | :--------- | :--------- | | Total revenues | $19,078,353 | $14,331,599 | $4,746,754 | 33.1% | | Plasma industry revenue | $10,743,924 | $11,273,262 | $(529,338) | -4.7% | | Pharma industry revenue | $7,753,906 | $2,674,901 | $5,079,005 | 189.9% | | Gross profit | $11,755,165 | $7,585,763 | $4,169,402 | 55.0% | | Income from operations | $1,437,607 | $125,677 | $1,311,930 | 1043.9% | | Net income | $1,387,761 | $697,102 | $690,659 | 99.1% | | Basic EPS | $0.03 | $0.01 | $0.02 | 200.0% | | Diluted EPS | $0.02 | $0.01 | $0.01 | 100.0% | Condensed Consolidated Statements of Operations Highlights (Six Months Ended June 30) | Metric | 2025 | 2024 | Change ($) | Change (%) | | :-------------------------- | :--------- | :--------- | :--------- | :--------- | | Total revenues | $37,676,502 | $27,521,673 | $10,154,829 | 36.9% | | Plasma industry revenue | $20,153,804 | $21,641,296 | $(1,487,492) | -6.9% | | Pharma industry revenue | $16,372,559 | $5,063,545 | $11,309,014 | 223.3% | | Gross profit | $23,445,993 | $14,525,014 | $8,920,979 | 61.4% | | Income (loss) from operations | $3,926,673 | $(132,675) | $4,059,348 | NM | | Net income | $3,973,861 | $1,006,198 | $2,967,663 | 294.9% | | Basic EPS | $0.07 | $0.02 | $0.05 | 250.0% | | Diluted EPS | $0.07 | $0.02 | $0.05 | 250.0% | [Condensed Consolidated Statements of Stockholders' Equity](index=5&type=section&id=PAYSIGN,%20INC.%20CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20STOCKHOLDERS'%20EQUITY) This section outlines changes in the company's equity accounts over the reporting period Stockholders' Equity Changes (December 31, 2024 to June 30, 2025) | Item | Amount ($) | | :---------------------------------- | :--------- | | Balance, December 31, 2024 | 30,441,632 | | Stock-based compensation | 1,626,718 | | Repurchase of common stock | (375,786) | | Issuance of stock in business combination | 5,950,000 | | Net income | 3,973,861 | | Balance, June 30, 2025 | 42,207,959 | - Total stockholders' equity increased by **$11,766,327** from December 31, 2024, to June 30, 2025, primarily driven by net income, stock-based compensation, and the issuance of stock for a business combination, partially offset by common stock repurchases[15](index=15&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=PAYSIGN,%20INC.%20CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) This section summarizes the cash inflows and outflows from operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows Highlights (Six Months Ended June 30) | Activity | 2025 ($) | 2024 ($) | Change ($) | | :---------------------------------- | :----------- | :----------- | :----------- | | Net cash (used in) provided by operating activities | (2,392,276) | 28,796,693 | (31,188,969) | | Net cash used in investing activities | (6,253,535) | (4,640,045) | (1,613,490) | | Net cash provided by financing activities | 215,748 | 24,000 | 191,748 | | Net change in cash and restricted cash | (8,430,063) | 24,180,648 | (32,610,711) | | Cash and restricted cash, end of period | 113,913,123 | 133,531,661 | (19,618,538) | - Operating activities shifted from providing **$28.8 million** in cash in H1 2024 to using **$2.4 million** in H1 2025, primarily due to changes in operating assets and liabilities related to pharma patient affordability business growth and timing of pass-through payments[17](index=17&type=chunk)[134](index=134&type=chunk) - Investing activities cash usage increased, largely due to the **$2 million** cash payment for the Gamma acquisition and continued investment in software licenses and internally developed software[17](index=17&type=chunk)[135](index=135&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=7&type=section&id=PAYSIGN,%20INC.%20NOTES%20TO%20CONDENSED%20CONSOLIDATED%20FINANCIAL%20STATEMENTS) This section includes detailed notes explaining the basis of presentation, significant accounting policies, recent acquisition, and other financial details [1. Basis of Presentation and Summary of Significant Policies](index=7&type=section&id=1.%20Basis%20of%20Presentation%20and%20Summary%20of%20Significant%20Policies) This section outlines the foundational principles and key accounting methods used in preparing the financial statements - Paysign, Inc. (PAYS) is a provider of prepaid card programs, pharma patient affordability offerings, digital banking services, and integrated payment processing, incorporated in Nevada since August 24, 1995[22](index=22&type=chunk) - The company operates as a single operating and reportable segment, with the CEO assessing performance and allocating resources on a consolidated basis[24](index=24&type=chunk)[25](index=25&type=chunk) - Revenue is generated from plasma and pharma card programs, including cardholder fees, interchange fees, program management fees, transaction claim processing fees, and breakage[49](index=49&type=chunk) - Breakage revenue for Q2 2025 was **$54,934** (vs. $33,995 in Q2 2024) and for H1 2025 was **$156,124** (vs. $86,786 in H1 2024)[50](index=50&type=chunk)[51](index=51&type=chunk) - The company is evaluating the impact of new FASB ASUs: ASU 2023-09 (Income Taxes – Improvements to Income Tax Disclosures) effective for fiscal years after Dec 15, 2024, and ASU 2024-03 (Disaggregation of Income Statement Expenses) effective for fiscal years after Dec 15, 2026[58](index=58&type=chunk)[59](index=59&type=chunk) - ASU 2023-07 (Improvements to Reportable Segment Disclosures) had no material impact[60](index=60&type=chunk) [2. Acquisition](index=12&type=section&id=2.%20Acquisition) This section details the financial aspects and strategic rationale behind the company's recent business acquisition - On March 19, 2025, Paysign acquired substantially all assets of Gamma Innovation LLC, a software and services company focused on the blood and plasma collection industry, for a total preliminary purchase consideration of **$15,558,637**[61](index=61&type=chunk)[62](index=62&type=chunk) Gamma Acquisition Purchase Consideration | Component | Amount ($) | | :-------------------------- | :----------- | | Cash paid upfront | 2,000,000 | | Present value of future cash paid | 6,618,637 | | Equity consideration | 5,950,000 | | Earn-out contingent consideration | 990,000 | | **Total consideration** | **15,558,637** | - The acquisition resulted in **$4,487,637** in goodwill, attributable to expected growth opportunities, potential synergies, and an assembled workforce[63](index=63&type=chunk)[64](index=64&type=chunk) - Identifiable intangible assets acquired were valued at **$11,071,000**, with acquired technologies accounting for **$10,568,000**[65](index=65&type=chunk) [3. Fixed Assets, Net](index=14&type=section&id=3.%20Fixed%20Assets,%20Net) This section presents the company's property, plant, and equipment, net of accumulated depreciation Fixed Assets, Net (June 30, 2025 vs. December 31, 2024) | Category | June 30, 2025 ($) | December 31, 2024 ($) | | :-------------------- | :---------------- | :-------------------- | | Equipment | 2,780,441 | 2,688,611 | | Software | 560,447 | 487,364 | | Furniture and fixtures | 762,144 | 762,144 | | Website costs | 69,881 | 69,881 | | Leasehold improvements | 236,904 | 236,904 | | **Total cost** | **4,409,817** | **4,244,904** | | Less: accumulated depreciation | (3,291,448) | (3,086,929) | | **Fixed assets, net** | **1,118,369** | **1,157,975** | - Net fixed assets slightly decreased by **$39,606**, despite increases in equipment and software, due to higher accumulated depreciation[66](index=66&type=chunk) - Depreciation expense for Q2 2025 was **$102,672** (vs. $86,823 in Q2 2024) and for H1 2025 was **$204,519** (vs. $177,923 in H1 2024)[66](index=66&type=chunk) [4. Intangible Assets, Net](index=14&type=section&id=4.%20Intangible%20Assets,%20Net) This section details the company's non-physical assets, such as patents, software platforms, and customer lists, net of amortization Intangible Assets, Net (June 30, 2025 vs. December 31, 2024) | Category | June 30, 2025 ($) | December 31, 2024 ($) | | :-------------------------- | :---------------- | :-------------------- | | Patents and trademarks | 38,186 | 38,186 | | Platform | 33,385,265 | 29,317,318 | | Customer lists and contracts | 1,177,200 | 1,177,200 | | Licenses | 237,576 | 216,901 | | Hosting implementation | 43,400 | 43,400 | | Contract assets | 277,600 | 277,600 | | Non-compete agreement | 503,000 | – | | Acquired technologies | 10,568,000 | – | | **Total cost** | **46,230,227** | **31,070,605** | | Less: accumulated amortization | (22,547,469) | (18,830,888) | | **Intangible assets, net** | **23,682,758** | **12,239,717** | - Net intangible assets significantly increased by **$11,443,041**, primarily due to the acquisition of Gamma Innovation LLC, which added **$10,568,000** in acquired technologies and **$503,000** in non-compete agreements[67](index=67&type=chunk)[65](index=65&type=chunk) - Amortization expense for Q2 2025 was **$2,017,425** (vs. $1,352,799 in Q2 2024) and for H1 2025 was **$3,716,581** (vs. $2,548,104 in H1 2024), reflecting the increased intangible asset base[67](index=67&type=chunk) [5. Lease](index=15&type=section&id=5.%20Lease) This section describes the company's operating lease arrangements and future payment obligations - The Company has an operating lease for office space effective June 2020, with a 10-year term and two optional five-year extensions not recognized in the right-of-use asset or lease liability[69](index=69&type=chunk) Operating Lease Maturity Analysis (as of June 30, 2025) | Year Ending December 31, | Lease Payments ($) | | :------------------------------- | :----------------- | | 2025 (remaining six months) | 320,302 | | 2026 | 640,604 | | 2027 | 640,604 | | 2028 | 640,604 | | 2029 | 640,604 | | Thereafter | 266,919 | | **Total lease payments** | **3,149,637** | | Less: Imputed interest | (427,913) | | **Present value of future lease payments** | **2,721,724** | [6. Customer Card Funding Liability](index=15&type=section&id=6.%20Customer%20Card%20Funding%20Liability) This section details the company's liability for funds loaded onto customer cards or available for reimbursement claims Customer Card Funding Liability (Six Months Ended June 30) | Metric | 2025 ($) | 2024 ($) | | :---------------- | :----------- | :----------- | | Beginning balance | 111,328,270 | 92,282,124 | | (Decrease) Increase, net | (9,576,918) | 9,797,702 | | Ending balance | 101,751,352 | 102,079,826 | - Customer card funding liability decreased by **$9,576,918** in H1 2025, contrasting with an increase of **$9,797,702** in H1 2024[73](index=73&type=chunk) - This liability represents funds loaded on cards or available for reimbursement claims[72](index=72&type=chunk) [7. Common Stock](index=16&type=section&id=7.%20Common%20Stock) This section provides information on the company's common stock, including shares issued, outstanding, and stock-based compensation - As of June 30, 2025, Paysign had **55,345,796** shares of common stock issued and **54,411,088** shares outstanding[74](index=74&type=chunk) Stock-Based Compensation Expense (Three and Six Months Ended June 30) | Period | 2025 ($) | 2024 ($) | | :-------------------- | :----------- | :----------- | | Three Months Ended | 954,400 | 670,138 | | Six Months Ended | 1,626,718 | 1,334,089 | - During H1 2025, the Company issued **988,000** shares for vested stock awards and option exercises, receiving **$591,356** from option exercises[76](index=76&type=chunk) - It also granted **5,976,000** restricted stock awards with a weighted average grant date fair value of **$2.36**[77](index=77&type=chunk) [8. Basic and Fully Diluted Net Income (Loss) Per Common Share](index=16&type=section&id=8.%20Basic%20and%20Fully%20Diluted%20Net%20Income%20(Loss)%20Per%20Common%20Share) This section presents the calculation of earnings per share, both basic and diluted, for the reporting periods Net Income Per Common Share (Three Months Ended June 30) | Metric | 2025 | 2024 | | :---------------- | :--- | :--- | | Basic EPS | $0.03 | $0.01 | | Diluted EPS | $0.02 | $0.01 | | Basic Weighted Average Shares | 54,228,027 | 53,008,286 | | Diluted Weighted Average Shares | 57,872,318 | 55,861,786 | Net Income Per Common Share (Six Months Ended June 30) | Metric | 2025 | 2024 | | :---------------- | :--- | :--- | | Basic EPS | $0.07 | $0.02 | | Diluted EPS | $0.07 | $0.02 | | Basic Weighted Average Shares | 53,903,829 | 52,926,462 | | Diluted Weighted Average Shares | 56,312,252 | 55,374,336 | [9. Commitments and Contingencies](index=17&type=section&id=9.%20Commitments%20and%20Contingencies) This section discloses potential future obligations and uncertain events that could impact the company's financial position - A securities class action lawsuit (In re Paysign, Inc. Securities Litigation) was preliminarily settled for **$3,750,000**, fully covered by the Company's directors-and-officers insurance policy, and received final court approval on April 18, 2024[82](index=82&type=chunk) - Four stockholder derivative actions (Toczek, Gray, Blanchette, Jeewa) are pending, alleging breach of fiduciary duty, unjust enrichment, waste, and insider trading[83](index=83&type=chunk)[84](index=84&type=chunk)[85](index=85&type=chunk)[86](index=86&type=chunk) - The parties agreed in principle to a proposed settlement on October 4, 2024, with preliminary approval motion pending[86](index=86&type=chunk) [10. Income Tax](index=18&type=section&id=10.%20Income%20Tax) This section provides details on the company's income tax expense, effective tax rates, and related accounting policies Income Tax Expense and Effective Tax Rates (Three and Six Months Ended June 30) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :------------------------ | :------ | :------ | :------ | :------ | | Income before income taxes | $2,042,767 | $939,034 | $5,294,031 | $1,412,026 | | Income tax expense | $655,006 | $241,932 | $1,320,170 | $405,828 | | Effective tax rate | 32.1% | 25.8% | 24.9% | 28.7% | - The effective tax rate for Q2 2025 increased to **32.1%** from 25.8% in Q2 2024, reflecting the impact of discrete items related to stock price appreciation[87](index=87&type=chunk)[114](index=114&type=chunk)[124](index=124&type=chunk) - For H1 2025, the rate was **24.9%** (vs. 28.7% in H1 2024), primarily due to tax benefits from stock-based compensation[87](index=87&type=chunk)[114](index=114&type=chunk)[124](index=124&type=chunk) - The Company is evaluating the impact of the One Big Beautiful Bill (OBBB), signed into law on July 4, 2025, which solidifies tax law changes from the TCJA 2017[88](index=88&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=19&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on Paysign, Inc.'s financial condition and results of operations for the three and six months ended June 30, 2025, compared to the same periods in 2024 [Disclosure Regarding Forward-Looking Statements](index=19&type=section&id=Disclosure%20Regarding%20Forward-Looking%20Statements) This section highlights that the report contains projections and expectations about future events, subject to various risks and uncertainties - The report contains forward-looking statements based on current expectations, assumptions, estimates, and projections, identified by words like 'believe,' 'anticipate,' 'expect,' 'intend,' 'plan,' and 'may'[91](index=91&type=chunk) - Key forward-looking statements include expectations regarding no losses from uninsured bank balances, future lease obligations, seamless platform integration, end-to-end technology capabilities, focus on corporate incentive and expense prepaid card products, and plans for continued investment in technology, sales, marketing, cybersecurity, and compliance in 2025[91](index=91&type=chunk) [Overview](index=19&type=section&id=Overview) This section provides a general description of Paysign's business, its product offerings, and strategic focus - Paysign is a vertically integrated provider of prepaid card products and processing services for corporate, consumer, and government applications, operating on a high-availability payments platform[92](index=92&type=chunk)[93](index=93&type=chunk) - The company's product offerings include solutions for corporate rewards, prepaid gift cards, general purpose reloadable debit cards, employee incentives, consumer rebates, donor compensation, clinical trials, healthcare reimbursement, and pharmaceutical payment assistance[94](index=94&type=chunk) - Paysign is focusing marketing efforts on corporate incentive and expense prepaid card products across various verticals, including healthcare-related markets, and is now also selling its donor engagement application and customer resource management product following the Gamma acquisition[102](index=102&type=chunk) - In 2025, Paysign plans to invest further in technology improvements, sales and marketing, cybersecurity, fraud prevention, customer service, and regulatory compliance, aiming to support existing business and expand into new markets using internally generated funds or potentially new capital[105](index=105&type=chunk) [Results of Operations](index=21&type=section&id=Results%20of%20Operations) This section analyzes Paysign's financial performance for the three and six months ended June 30, 2025, compared to the prior year, detailing revenue and expense drivers [Comparison of Q2 2025 to Q2 2024](index=21&type=section&id=Comparison%20of%20the%20Three%20Months%20Ended%20June%2030,%202025%20to%20the%20Three%20Months%20Ended%20June%2030,%202024) This section compares the company's financial performance for the second quarter of 2025 against the same period in 2024 Q2 2025 vs. Q2 2024 Financial Performance | Metric | Q2 2025 ($) | Q2 2024 ($) | Change ($) | Change (%) | | :---------------------------------- | :---------- | :---------- | :--------- | :--------- | | Total revenues | 19,078,353 | 14,331,599 | 4,746,754 | 33.1% | | Plasma industry revenue | 10,743,924 | 11,273,262 | (529,338) | (4.7%) | | Pharma industry revenue | 7,753,906 | 2,674,901 | 5,079,005 | 189.9% | | Other revenue | 580,523 | 383,436 | 197,087 | 51.4% | | Cost of revenues | 7,323,188 | 6,745,836 | 577,352 | 8.6% | | Gross profit | 11,755,165 | 7,585,763 | 4,169,402 | 55.0% | | Gross margin % | 61.6% | 52.9% | 8.7% | | | Selling, general and administrative | 8,197,461 | 6,020,464 | 2,176,997 | 36.2% | | Depreciation and amortization | 2,120,097 | 1,439,622 | 680,475 | 47.3% | | Income from operations | 1,437,607 | 125,677 | 1,311,930 | 1043.9% | | Net income | 1,387,761 | 697,102 | 690,659 | 99.1% | - Total revenues increased by **33.1%**, driven by a **189.9%** surge in pharma revenue due to new programs and increased claims processed (over 80% increase), offsetting a **4.7%** decline in plasma revenue as donation levels normalized[107](index=107&type=chunk) - Gross profit increased by **55.0%**, and gross margin improved from **52.9%** to **61.6%**, primarily due to the higher gross profit margins of the growing pharma patient affordability business[109](index=109&type=chunk) - Operating expenses rose by **38.3%**, mainly due to increased compensation and benefits (**$974,000**), technology and telecom investments (**$299,000**), and stock-based compensation (**$284,000**) to support business growth and platform security[110](index=110&type=chunk) [Comparison of H1 2025 to H1 2024](index=23&type=section&id=Comparison%20of%20the%20Six%20Months%20Ended%20June%2030,%202025%20to%20the%20Six%20Months%20Ended%20June%2030,%202024) This section compares the company's financial performance for the first half of 2025 against the same period in 2024 H1 2025 vs. H1 2024 Financial Performance | Metric | H1 2025 ($) | H1 2024 ($) | Change ($) | Change (%) | | :---------------------------------- | :---------- | :---------- | :--------- | :--------- | | Total revenues | 37,676,502 | 27,521,673 | 10,154,829 | 36.9% | | Plasma industry revenue | 20,153,804 | 21,641,296 | (1,487,492) | (6.9%) | | Pharma industry revenue | 16,372,559 | 5,063,545 | 11,309,014 | 223.3% | | Other revenue | 1,150,139 | 816,832 | 333,307 | 40.8% | | Cost of revenues | 14,230,509 | 12,996,659 | 1,233,850 | 9.5% | | Gross profit | 23,445,993 | 14,525,014 | 8,920,979 | 61.4% | | Gross margin % | 62.2% | 52.8% | 9.4% | | | Selling, general and administrative | 15,598,220 | 11,931,662 | 3,666,558 | 30.7% | | Depreciation and amortization | 3,921,100 | 2,726,027 | 1,195,073 | 43.8% | | Income (loss) from operations | 3,926,673 | (132,675) | 4,059,348 | NM | | Net income | 3,973,861 | 1,006,198 | 2,967,663 | 294.9% | - Total revenues increased by **36.9%** for H1 2025, primarily driven by a **223.3%** increase in pharma revenue due to 21 new programs launched in H1 2025 and the full-year impact of 2024 programs, leading to over **110%** increase in claims processed[117](index=117&type=chunk) - Gross profit for H1 2025 increased by **61.4%**, with gross margin improving from **52.8%** to **62.2%**, largely due to the higher margins of the pharma patient affordability business[119](index=119&type=chunk) - Operating expenses increased by **33.2%**, with compensation and benefits rising by **$2,519,000** and technology/telecom expenses by **$631,000**, reflecting investments in growth and platform security, including **$129,000** in Gamma acquisition costs[120](index=120&type=chunk) [Key Performance Indicators and Non-GAAP Measures](index=25&type=section&id=Key%20Performance%20Indicators%20and%20Non-GAAP%20Measures) This section presents key operational metrics and non-GAAP financial measures used to evaluate the company's performance Gross Dollar Volume Loaded on Cards (Three and Six Months Ended June 30) | Period | 2025 ($) | 2024 ($) | Change ($) | Change (%) | | :-------------------- | :--------- | :--------- | :--------- | :--------- | | Three Months Ended | 440 million | 456 million | (16 million) | -3.5% | | Six Months Ended | 847 million | 882 million | (35 million) | -4.0% | - Gross dollar volume loaded on cards declined year-over-year, reflecting a decrease in plasma programs partially offset by growth in pharma patient affordability and other prepaid programs[126](index=126&type=chunk) Conversion Rates on Gross Dollar Volume Loaded on Cards (Three and Six Months Ended June 30) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :-------------------------- | :------ | :------ | :------ | :------ | | Total revenue conversion rates | 4.34% | 3.14% | 4.45% | 3.12% | | Total gross profit conversion rates | 2.67% | 1.66% | 2.77% | 1.65% | | Net income (loss) conversion rates | 0.32% | 0.15% | 0.47% | 0.11% | Adjusted EBITDA Reconciliation (Three and Six Months Ended June 30) | Metric | Q2 2025 ($) | Q2 2024 ($) | H1 2025 ($) | H1 2024 ($) | | :-------------------------- | :---------- | :---------- | :---------- | :---------- | | Net income | 1,387,761 | 697,102 | 3,973,861 | 1,006,198 | | Income tax provision | 655,006 | 241,932 | 1,320,170 | 405,828 | | Interest income, net | (605,160) | (813,357) | (1,367,358) | (1,544,701) | | Depreciation and amortization | 2,120,097 | 1,439,622 | 3,921,100 | 2,726,027 | | **EBITDA** | **3,557,704** | **1,565,299** | **7,847,773** | **2,593,352** | | Stock-based compensation | 954,400 | 670,138 | 1,626,718 | 1,334,089 | | **Adjusted EBITDA** | **4,512,104** | **2,235,437** | **9,474,491** | **3,927,441** | Adjusted EBITDA Margin (Three and Six Months Ended June 30) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :-------------------- | :------ | :------ | :------ | :------ | | Net income margin | 7.3% | 4.9% | 10.5% | 3.7% | | EBITDA margin | 18.6% | 10.9% | 20.8% | 9.4% | | Adjusted EBITDA margin | 23.7% | 15.6% | 25.1% | 14.3% | [Liquidity and Capital Resources](index=26&type=section&id=Liquidity%20and%20Capital%20Resources) This section assesses the company's cash flows, liquidity position, and capital resources for the periods presented [Comparison of H1 2025 and 2024 Cash Flows](index=27&type=section&id=Comparison%20of%20Six%20Months%20Ended%20June%2030,%202025%20and%202024) This section compares the company's cash flow activities for the first half of 2025 against the same period in 2024 Major Sources and Uses of Cash (Six Months Ended June 30) | Activity | 2025 ($) | 2024 ($) | Change ($) | | :---------------------------------- | :----------- | :----------- | :----------- | | Net cash (used in) provided by operating activities | (2,392,276) | 28,796,693 | (31,188,969) | | Net cash used in investing activities | (6,253,535) | (4,640,045) | (1,613,490) | | Net cash provided by financing activities | 215,748 | 24,000 | 191,748 | | Net (decrease) increase in cash and restricted cash | (8,430,063) | 24,180,648 | (32,610,711) | - Operating activities shifted from a net cash inflow of **$28.8 million** in H1 2024 to a net cash outflow of **$2.4 million** in H1 2025, primarily due to changes in accounts receivable, accounts payable, and customer card funding related to the pharma patient affordability business growth and timing of pass-through payments[134](index=134&type=chunk) - Investing activities used **$6.3 million** in H1 2025, an increase from **$4.6 million** in H1 2024, mainly due to **$2 million** for the Gamma acquisition and continued capitalization of internally developed software[135](index=135&type=chunk) - Financing activities provided **$215,748** in H1 2025, primarily from stock option exercises (**$591,534**), partially offset by common stock repurchases (**$375,786**)[136](index=136&type=chunk) [Sources of Liquidity](index=27&type=section&id=Sources%20of%20Liquidity) This section discusses the company's available cash and expected future cash flows to meet its operational needs - Paysign believes its available cash on hand (**$11,753,184** at June 30, 2025), excluding restricted cash, combined with forecasted revenues and cash flows, will be sufficient to sustain operations for the next twenty-four months[138](index=138&type=chunk) [Critical Accounting Policies and Estimates](index=27&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section identifies the accounting policies that require significant judgment and estimation by management - The preparation of financial statements requires management to make estimates and assumptions that affect reported amounts, and actual results may differ significantly from these estimates[140](index=140&type=chunk)[141](index=141&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=28&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, Paysign, Inc. is not required to provide quantitative and qualitative disclosures about market risk - Paysign, Inc. is exempt from providing quantitative and qualitative disclosures about market risk due to its status as a smaller reporting company[142](index=142&type=chunk) [Item 4. Controls and Procedures](index=28&type=section&id=Item%204.%20Controls%20and%20Procedures) This section confirms the effectiveness of Paysign, Inc.'s disclosure controls and procedures and reports no material changes in internal control over financial reporting during the quarter ended June 30, 2025 - The CEO and CFO concluded that Paysign's disclosure controls and procedures were effective as of June 30, 2025[143](index=143&type=chunk) - There were no material changes in internal control over financial reporting during the quarter ended June 30, 2025[144](index=144&type=chunk) [PART II. OTHER INFORMATION](index=29&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=29&type=section&id=Item%201.%20Legal%20Proceedings) This section details Paysign, Inc.'s involvement in legal proceedings, including a securities class action that has been settled and multiple pending stockholder derivative actions - A securities class action lawsuit, In re Paysign, Inc. Securities Litigation, was settled for **$3,750,000**, fully covered by the Company's D&O insurance, and received final court approval on April 18, 2024[148](index=148&type=chunk) - Four stockholder derivative actions (Toczek, Gray, Blanchette, Jeewa) are pending, alleging violations of the Exchange Act, breach of fiduciary duty, unjust enrichment, and waste[149](index=149&type=chunk)[150](index=150&type=chunk)[151](index=151&type=chunk)[152](index=152&type=chunk) - The parties agreed in principle to a proposed settlement on October 4, 2024, with preliminary approval motion currently pending[152](index=152&type=chunk) [Item 1A. Risk Factors](index=30&type=section&id=Item%201A.%20Risk%20Factors) As a smaller reporting company, Paysign, Inc. is not required to provide risk factor disclosures in this quarterly report - Paysign, Inc. is exempt from providing risk factor disclosures in this Form 10-Q due to its status as a smaller reporting company[153](index=153&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=30&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section confirms no unregistered sales of equity securities during the quarter and provides an update on the Company's common stock repurchase program - No shares of common stock were issued in unregistered sales during the quarter ended June 30, 2025[154](index=154&type=chunk) - As of June 30, 2025, Paysign had repurchased **631,258** shares of common stock for **$1,998,715** at a weighted average price of **$3.17** per share under a **$5 million** stock repurchase program authorized on March 21, 2023[156](index=156&type=chunk) - No shares were repurchased during the three months ended June 30, 2025, leaving **$3,001,285** available under the program[156](index=156&type=chunk) [Item 5. Other Information](index=31&type=section&id=Item%205.%20Other%20Information) This section states that no director or officer adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the quarter - No director or officer adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the quarter ended June 30, 2025[157](index=157&type=chunk) [Item 6. Exhibits](index=31&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed as part of the Form 10-Q, including certifications and XBRL-related documents - The exhibits include Rule 13a-14(a)/15d-14(a) Certifications, Section 1350 Certifications, and various Inline XBRL documents[160](index=160&type=chunk) [SIGNATURES](index=32&type=section&id=SIGNATURES) This section contains the required signatures for the Form 10-Q report, confirming its submission on behalf of Paysign, Inc. - The report was signed by Mark Newcomer, President and Chief Executive Officer, and Jeff Baker, Chief Financial Officer, on August 6, 2025[164](index=164&type=chunk)

Financial Data and Key Metrics Changes - Company reported record revenue of $19.1 million, up 33% year-over-year, with gross margins improving by 870 basis points to 61.6% [5][13] - Adjusted EBITDA doubled to $4.5 million, a 102% increase from the same quarter last year, and net income nearly doubled to $1.4 million, up 99% year-over-year [5][15] - Total operating expenses increased by 38.3% to $10.3 million, with SG&A rising 35.4% to $7.2 million [14] Business Line Data and Key Metrics Changes - Patient affordability business revenue grew 190% year-over-year to $7.75 million, accounting for 40.6% of total revenue, up from 18.7% in the same period last year [5][14] - Plasma compensation business revenue was $10.7 million, down 4.7% year-over-year but up 14.2% sequentially [7][8] Market Data and Key Metrics Changes - Company ended the quarter with 607 plasma centers, having onboarded 123 of the 132 awarded centers, achieving approximately 50% market share [8][9] - The company expects to onboard an additional 10 to 13 centers in the second half of the year [8] Company Strategy and Development Direction - Company plans to open a new patient services contact center to increase support capacity fourfold, addressing growing demand [6] - Introduction of a software as a service engagement platform at the International Plasma Protein Congress, indicating a shift towards becoming a broader technology provider [10] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in the business prospects for the remainder of the year and into 2026, despite headwinds in the plasma business [12][17] - The company anticipates a return to organic growth in plasma collection starting in 2026 as the collection cycle improves [9] Other Important Information - Company raised its revenue guidance for 2025 to a range of $76.5 million to $78.5 million, reflecting year-over-year growth of 32.7% at the midpoint [17] - Expects net income for the year to be between $6 million and $7 million, or $0.10 to $0.12 per diluted share [18] Q&A Session Summary Question: Can you touch on the 30 to 40 programs expected to onboard in pharma? - Response indicated a mix of new clients and additional programs from existing clients, approximately fifty-fifty [22][23] Question: On the plasma side, does the expected addition of centers include the nine onboarded after June 30? - Response confirmed that it includes the nine centers [25] Question: Update on the donor management system timeline? - Response indicated targeting approval by the end of the year [26][28] Question: How does the average revenue of new centers compare to existing business? - Response stated that new centers are expected to be in line with existing averages [33] Question: What strategies are in place to retain donors from closing centers? - Response explained that donors will be directed to nearby centers, ensuring retention [35][36] Question: Breakdown of revenue within pharma? - Response clarified that revenue comes from program setup fees, monthly management fees, and various transactional fees [39][40] Question: Should the increase in revenue per pharma program be interpreted as a shift towards more specialty programs? - Response indicated that while there is a concentration on specialty products, the increase is also due to additional services offered [48][49]

[Executive Summary & Q2 2025 Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Q2%202025%20Highlights) Paysign achieved record Q2 2025 financial results with significant growth in revenue, net income, and Adjusted EBITDA, primarily driven by its expanding pharma patient affordability business and strategic initiatives [CEO Statement & Strategic Overview](index=1&type=section&id=CEO%20Statement%20%26%20Strategic%20Overview) Paysign's CEO, Mark Newcomer, highlighted Q2 2025 as a milestone quarter with record revenue, expanded gross margins, and significantly increased Adjusted EBITDA and net income. The pharma patient affordability business showed impressive growth, and the company is executing strategic initiatives to expand plasma offerings and scale pharma solutions, including a new patient services contact center - Q2 2025 was a milestone quarter with **record quarterly revenue**, **expanded gross margins**, and **more than doubled adjusted EBITDA**[3](index=3&type=chunk) - Pharma patient affordability business grew revenue by **190%**, ending the quarter with **97 active programs** and expecting **30-40 more by year-end**[3](index=3&type=chunk) - Strategic initiatives include expanding plasma offerings with SaaS donor engagement technologies and scaling pharma patient affordability solutions by opening a new patient services contact center in Q3 to **quadruple support capacity**[3](index=3&type=chunk) [Key Financial & Operational Highlights (Q2 2025)](index=1&type=section&id=Key%20Financial%20%26%20Operational%20Highlights%20(Q2%202025)) Paysign reported strong financial performance in Q2 2025, with significant year-over-year growth in total revenues, net income, and Adjusted EBITDA. The pharma patient affordability segment was a primary growth driver, while plasma revenue saw a slight decrease despite an increase in centers | Metric | Q2 2025 | Q2 2024 | YoY Change | YoY % Change | | :-------------------------------- | :---------- | :---------- | :--------- | :----------- | | Total Revenues | $19.08 million | $14.33 million | $4.75 million | 33.1% | | Net Income | $1.39 million | $697 thousand | $693 thousand | 99.1% | | Diluted Earnings Per Share | $0.02 | $0.01 | $0.01 | 100.0% | | Adjusted EBITDA | $4.51 million | $2.24 million | $2.27 million | 101.8% | | Diluted Adjusted EBITDA Per Share | $0.08 | $0.04 | $0.04 | 100.0% | | Segment | Q2 2025 Status | Q2 2024 Status | YoY Change | YoY % Change | | :-------------------------------- | :--------------- | :--------------- | :--------- | :----------- | | Plasma Centers Added (Net) | 123 | - | - | - | | Total Plasma Centers | 607 | - | - | - | | Avg Monthly Revenue per Plasma Center | $7,098 | $7,916 | -$818 | -10.3% | | Plasma Revenue | - | - | -$529 thousand | -4.7% | | Pharma Programs Added (Net) | 7 | - | - | - | | Total Active Pharma Programs | 97 | - | - | - | | Avg Quarterly Revenue per Pharma Program | $79,937 | $43,851 | $36,086 | 82.3% | | Processed Claims (Pharma) | - | - | - | >80% | | Pharma Patient Affordability Revenue | - | - | $5.08 million | 189.9% | - Exited the quarter with **$11.8 million of unrestricted cash** and **zero bank debt**[4](index=4&type=chunk) [Detailed Second Quarter 2025 Results](index=2&type=section&id=Detailed%20Second%20Quarter%202025%20Results) Paysign's Q2 2025 results show robust revenue growth driven by pharma patient affordability, leading to substantial increases in gross profit, net income, and Adjusted EBITDA, despite higher operating expenses and a slight decline in plasma revenue [Revenue Analysis by Segment](index=2&type=section&id=Revenue%20Analysis%20by%20Segment) Total revenues increased by 33.1% year-over-year, driven primarily by a substantial increase in pharma patient affordability revenue, which more than offset a slight decline in plasma revenue due to reduced revenue per center and industry oversupply | Revenue Segment | Q2 2025 Revenue | Q2 2024 Revenue | Change | % Change | | :---------------------- | :-------------- | :-------------- | :----- | :------- | | Plasma industry | $10,743,924 | $11,273,262 | -$529,338 | -4.7% | | Pharma industry | $7,753,906 | $2,674,901 | $5,079,005 | 189.9% | | Other | $580,523 | $383,436 | $197,087 | 51.4% | | **Total Revenues** | **$19,078,353** | **$14,331,599** | **$4,746,754** | **33.1%** | - Plasma revenue decrease was primarily due to reduced revenue per plasma center, plasma donations, and dollars loaded to cards, despite adding **123 net centers** which went live late in the quarter, largely attributed to an **industry-wide oversupply in plasma inventories**[7](index=7&type=chunk) - Pharma patient affordability revenue growth was driven by the launch of new programs and seasonally strong processed claim volume, with **average quarterly revenue per program increasing significantly**[7](index=7&type=chunk) [Cost of Revenues and Gross Profit](index=2&type=section&id=Cost%20of%20Revenues%20and%20Gross%20Profit) Cost of revenues increased due to growth in pharma programs and plasma-related costs, but gross profit saw a substantial increase and margin expansion, primarily driven by the favorable revenue mix from the high-growth pharma patient affordability business | Metric | Q2 2025 | Q2 2024 | Change | % Change | | :---------------- | :---------- | :---------- | :----- | :------- | | Cost of Revenues | $7,323,188 | $6,745,836 | $577,352 | 8.6% | | Gross Profit | $11,755,165 | $7,585,763 | $4,169,402 | 55.0% | | Gross Profit Margin | 61.6% | 52.9% | 8.7% | 16.4% | - Increase in cost of revenues was primarily due to increased **customer care expense (47.0%)**, **third-party program management fees (99.9%)** for pharma programs, **plastics/collateral/postage (80.7%)** for plasma programs, and **sales/commission expense (169.4%)**[5](index=5&type=chunk) - Gross profit margin increased by approximately **nine percentage points**, mainly due to an increased mix of revenue from the pharma patient affordability business and stable plasma gross margins, partially offset by one-time upfront costs for new plasma centers[6](index=6&type=chunk) [Operating Expenses](index=2&type=section&id=Operating%20Expenses) Selling, general and administrative (SG&A) expenses and depreciation and amortization (D&A) both increased significantly, reflecting investments in growth, platform security, and software development, particularly to support the expanding pharma patient affordability business | Expense Category | Q2 2025 | Q2 2024 | Change | % Change | | :-------------------------------- | :---------- | :---------- | :----- | :------- | | Selling, General and Administrative | $8,197,461 | $6,020,464 | $2,176,997 | 36.2% | | Depreciation and Amortization | $2,120,097 | $1,439,622 | $680,475 | 47.3% | | **Total Operating Expenses** | **$10,317,558** | **$7,460,086** | **$2,857,472** | **38.3%** | - SG&A increase was driven by higher **compensation and benefits (19.6%)** due to hiring for growth, **technologies and telecom (28.9%)** for platform security, **stock-based compensation (42.4%)**, and **general expenses (58.4%)**[8](index=8&type=chunk) - Depreciation and amortization expense increased mainly due to continued capitalization of new software development costs and equipment purchases related to processing platform enhancements[8](index=8&type=chunk) [Other Income and Income Tax](index=2&type=section&id=Other%20Income%20and%20Income%20Tax) Other income decreased due to interest expense related to an acquisition and lower interest rates, while income tax expense increased, resulting in a higher effective tax rate influenced by stock price appreciation | Metric | Q2 2025 | Q2 2024 | Change | % Change | | :---------------------- | :---------- | :---------- | :----- | :------- | | Interest Income, Net | $605,160 | $813,357 | -$208,197 | -25.6% | | Income Tax Provision | $655,006 | $241,932 | $413,074 | 170.7% | | Effective Tax Rate | 32.1% | 25.8% | 6.3% | 24.4% | - Other income decreased primarily due to implied interest expense for future cash payments related to the Gamma acquisition and slightly lower interest rates and average bank account balances from plasma customers[8](index=8&type=chunk) - The effective tax rate of **32.1%** for Q2 2025, compared to **25.8%** in Q2 2024, reflects the impact of discrete items related to the appreciation of the company's stock price[8](index=8&type=chunk) [Net Income and Non-GAAP Metrics (EBITDA, Adjusted EBITDA)](index=2&type=section&id=Net%20Income%20and%20Non-GAAP%20Metrics%20(EBITDA%2C%20Adjusted%20EBITDA)) Paysign achieved a significant increase in net income, EBITDA, and Adjusted EBITDA, demonstrating strong operational performance and leverage, with Adjusted EBITDA more than doubling year-over-year | Metric | Q2 2025 | Q2 2024 | Change | % Change | | :------------------ | :---------- | :---------- | :----- | :------- | | Net Income | $1,387,761 | $697,102 | $690,659 | 99.1% | | EBITDA | $3,557,704 | $1,565,299 | $1,992,405 | 127.3% | | Adjusted EBITDA | $4,512,104 | $2,235,437 | $2,276,667 | 101.8% | | Net Income Margin | 7.3% | 4.9% | 2.4% | 49.0% | | EBITDA Margin | 18.6% | 10.9% | 7.7% | 70.6% | | Adjusted EBITDA Margin | 23.7% | 15.6% | 8.1% | 51.9% | - The overall change in net income, EBITDA, and Adjusted EBITDA relates to the factors mentioned in the detailed financial results, reflecting **strong growth in the pharma patient affordability business**[8](index=8&type=chunk) [Financial Position: Balance Sheet at June 30, 2025](index=4&type=section&id=Financial%20Position%3A%20Balance%20Sheet%20at%20June%2030%2C%202025) Paysign's balance sheet at June 30, 2025, shows an increase in total assets, driven by intangible assets and goodwill, and a significant rise in stockholders' equity, despite a decrease in total cash balances [Cash Balances](index=4&type=section&id=Cash%20Balances) Total cash balances decreased from December 31, 2024, primarily due to investments and acquisitions, despite an increase in unrestricted cash driven by net income. Restricted cash saw a reduction in plasma customer deposits, partially offset by an increase in pharma patient affordability deposits | Cash Type | June 30, 2025 | December 31, 2024 | Change | | :---------------- | :-------------- | :---------------- | :----- | | Unrestricted Cash | $11,753,184 | $10,766,982 | +$986,202 | | Restricted Cash | $102,159,939 | $111,576,204 | -$9,416,265 | | **Total Cash** | **$113,913,123** | **$122,343,186** | **-$8,430,063** | - The increase in unrestricted cash resulted primarily from an increase in net income from **strong growth in the pharma patient affordability business**, offset by investment in the platform, the purchase of Gamma Innovation LLC assets, payment of accrued operating expenses, and repurchase of **100,000 shares of common stock**[10](index=10&type=chunk) - Restricted cash decreased mainly due to a reduction in customer program deposits for plasma customers and funds on cards, partially offset by an increase of pharma patient affordability deposits[11](index=11&type=chunk) [Assets](index=8&type=section&id=Assets) Total assets increased, driven by a significant rise in intangible assets and the recognition of goodwill, reflecting recent acquisitions and ongoing investments | Asset Category | June 30, 2025 | December 31, 2024 | Change | | :-------------------------- | :-------------- | :---------------- | :----- | | Total Current Assets | $158,707,914 | $158,836,633 | -$128,719 | | Fixed Assets, net | $1,118,369 | $1,157,975 | -$39,606 | | Intangible Assets, net | $23,682,758 | $12,239,717 | +$11,443,041 | | Goodwill | $4,487,637 | - | +$4,487,637 | | Total Assets | $193,896,201 | $179,028,197 | +$14,868,004 | [Liabilities and Stockholders' Equity](index=8&type=section&id=Liabilities%20and%20Stockholders'%20Equity) Total liabilities increased slightly, while stockholders' equity saw a notable rise, primarily due to increased additional paid-in capital and retained earnings | Category | June 30, 2025 | December 31, 2024 | Change | | :-------------------------- | :-------------- | :---------------- | :----- | | Total Current Liabilities | $143,316,515 | $146,106,495 | -$2,789,980 | | Total Liabilities | $151,688,242 | $148,586,565 | +$3,101,677 | | Additional Paid-in Capital | $32,799,469 | $24,632,205 | +$8,167,264 | | Retained Earnings | $11,501,859 | $7,527,998 | +$3,973,861 | | Total Stockholders' Equity | $42,207,959 | $30,441,632 | +$11,766,327 | [Outlook and Guidance](index=4&type=section&id=Outlook%20and%20Guidance) Paysign revised its full-year 2025 guidance upward, projecting strong revenue growth and expanding margins driven by pharma, while Q3 anticipates continued revenue strength with slightly lower gross margins due to segment mix and new contact center startup costs [Full-Year 2025 Outlook](index=4&type=section&id=Full-Year%202025%20Outlook) Paysign revised its full-year 2025 estimates upward, projecting strong revenue growth driven by the pharma patient affordability business, which is expected to significantly increase its contribution to total revenue. Gross profit margins are anticipated to remain strong, and Adjusted EBITDA is forecasted to be between $18.0 million and $20.0 million | Metric | Full-Year 2025 Guidance | | :-------------------------------- | :---------------------- | | Total Revenues | $76.5 million to $78.5 million | | YoY Growth (midpoint) | 32.7% | | Plasma Revenue % of Total | ~56% (flat YoY growth) | | Pharma Patient Affordability Revenue % of Total | ~40.5% (>145% YoY growth) | | Gross Profit Margins | 61.0% to 62.0% | | Operating Expenses | $41.0 million to $43.0 million | | Depreciation and Amortization | ~$8.4 million | | Stock-based Compensation | ~$4.4 million | | Interest Income | ~$2.5 million | | Net Income | $6.0 million to $7.0 million | | Diluted EPS | $0.10 to $0.12 | | Adjusted EBITDA | $18.0 million to $20.0 million | | Diluted Adjusted EBITDA per share | $0.31 to $0.35 | | Diluted Share Count | 57.5 million shares | - The pharma patient affordability business is expected to represent **40.5% of total revenue**, a significant increase from **18.7% in the prior year**, helping to offset the decline in plasma due to industry-wide oversupply[12](index=12&type=chunk)[13](index=13&type=chunk) - Despite upfront costs for onboarding new plasma centers, the company expects to expand gross profit, operating, net, and Adjusted EBITDA margins, demonstrating **operating leverage**[12](index=12&type=chunk) [Third Quarter 2025 Outlook](index=5&type=section&id=Third%20Quarter%202025%20Outlook) For Q3 2025, Paysign anticipates continued revenue strength, with plasma contributing a larger percentage of revenue than pharma patient affordability, though gross profit margins are expected to be slightly lower due to the mix and startup costs for the new contact center | Metric | Q3 2025 Guidance | | :-------------------------------- | :---------------------- | | Total Revenue | $19.5 million to $20.5 million | | Plasma Revenue % of Total | ~60% | | Pharma Patient Affordability Revenue % of Total | ~37% | | Gross Profit Margins | ~59% | | Operating Expenses | $10.5 million to $11.5 million | | Depreciation and Amortization | ~$2.2 million | | Stock-based Compensation | ~$1.4 million | | Adjusted EBITDA | $4.5 million to $5.0 million | | Adjusted EBITDA % of Revenue | 23.1% to 24.4% | - Gross profit margins are expected to be approximately **59%** due to the higher mix of plasma revenue and impact from startup costs related to the new patient services contact center[15](index=15&type=chunk) [Company Information](index=5&type=section&id=Company%20Information) This section provides details on Paysign's Q2 2025 conference call, a disclaimer regarding forward-looking statements, an overview of the company's financial services and healthcare technology solutions, and contact information [Conference Call Details](index=5&type=section&id=Conference%20Call%20Details) Paysign will host a conference call on August 5, 2025, to discuss its second quarter 2025 financial results, with replay options available - Conference call to discuss Q2 2025 results scheduled for **5:00 p.m. Eastern time on Tuesday, August 5, 2025**[16](index=16&type=chunk) [Forward-Looking Statements Disclaimer](index=5&type=section&id=Forward-Looking%20Statements%20Disclaimer) The press release contains forward-looking statements subject to important risks, uncertainties, and other factors that could cause actual results to differ materially from projections, and the company undertakes no obligation to update these statements - Statements regarding future growth trajectory, plasma center counts, and financial expectations for Q3 and full-year 2025 are forward-looking[17](index=17&type=chunk) - Important risks include inability to sustain growth, economic downturns, regulatory changes, data security breaches, and other factors detailed in the Annual Report on Form 10-K[17](index=17&type=chunk) [About Paysign, Inc.](index=5&type=section&id=About%20Paysign%2C%20Inc.) Paysign, Inc. is a leading financial services provider specializing in technology solutions for the healthcare industry, offering prepaid card programs, pharma patient affordability, digital banking, and integrated payment processing through its robust, scalable platform and comprehensive in-house services - Paysign (NASDAQ: PAYS) is a financial services provider focused on technology solutions for the healthcare industry, offering prepaid card programs, pharma patient affordability, digital banking, and integrated payment processing[18](index=18&type=chunk) - Operates on a powerful, high-availability payments platform with fintech capabilities for secure transaction processing, cardholder enrollment, account management, data analytics, and **24/7/365 in-house bilingual customer service**[19](index=19&type=chunk)[20](index=20&type=chunk) - Serves major pharmaceutical and healthcare companies, as well as multinational corporations, with solutions including corporate rewards, prepaid gift cards, GPR debit cards, employee incentives, consumer rebates, donor compensation, clinical trials, and copay assistance[21](index=21&type=chunk) [Contacts](index=6&type=section&id=Contacts) Contact information for investor and media relations is provided [Condensed Consolidated Financial Statements (Unaudited)](index=7&type=section&id=Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) This section presents Paysign's unaudited condensed consolidated statements of operation and balance sheets, detailing financial performance and position, along with reconciliations of non-GAAP measures like EBITDA and Adjusted EBITDA [Condensed Consolidated Statements of Operation](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operation) The unaudited condensed consolidated statements of operation detail Paysign's revenues, costs, and profits for the three and six months ended June 30, 2025, compared to the same periods in 2024, showing significant growth in net income | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total Revenues | $19,078,353 | $14,331,599 | $37,676,502 | $27,521,673 | | Cost of Revenues | $7,323,188 | $6,745,836 | $14,230,509 | $12,996,659 | | Gross Profit | $11,755,165 | $7,585,763 | $23,445,993 | $14,525,014 | | Total Operating Expenses | $10,317,558 | $7,460,086 | $19,519,320 | $14,657,689 | | Income (loss) from operations | $1,437,607 | $125,677 | $3,926,673 | -$132,675 | | Net income | $1,387,761 | $697,102 | $3,973,861 | $1,006,198 | | Diluted Net income per share | $0.02 | $0.01 | $0.07 | $0.02 | [Condensed Consolidated Balance Sheets](index=8&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The unaudited condensed consolidated balance sheets present Paysign's financial position as of June 30, 2025, and December 31, 2024, showing an increase in total assets driven by intangible assets and goodwill, and a rise in stockholders' equity | Asset/Liability/Equity | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :-------------- | :---------------- | | Cash | $11,753,184 | $10,766,982 | | Restricted cash | $102,159,939 | $111,576,204 | | Total current assets | $158,707,914 | $158,836,633 | | Intangible assets, net | $23,682,758 | $12,239,717 | | Goodwill | $4,487,637 | - | | Total assets | $193,896,201 | $179,028,197 | | Customer card funding | $101,751,352 | $111,328,270 | | Total current liabilities | $143,316,515 | $146,106,495 | | Total liabilities | $151,688,242 | $148,586,565 | | Total stockholders' equity | $42,207,959 | $30,441,632 | [Non-GAAP Measures Reconciliation](index=9&type=section&id=Non-GAAP%20Measures%20Reconciliation) Paysign provides reconciliations of non-GAAP measures like EBITDA and Adjusted EBITDA to net income, emphasizing their use by management to gauge operating performance and cautioning against their isolation from GAAP accounting - Non-GAAP measures (EBITDA and Adjusted EBITDA) are used by management to gauge operating performance and help investors evaluate past financial performance and potential future results[25](index=25&type=chunk) - EBITDA is defined as earnings before interest, taxes, depreciation, and amortization expense, while Adjusted EBITDA further excludes stock-based compensation charges[26](index=26&type=chunk) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income | $1,387,761 | $697,102 | $3,973,861 | $1,006,198 | | Income tax provision | $655,006 | $241,932 | $1,320,170 | $405,828 | | Interest income, net | -$605,160 | -$813,357 | -$1,367,358 | -$1,544,701 | | Depreciation and amortization | $2,120,097 | $1,439,622 | $3,921,100 | $2,726,027 | | **EBITDA** | **$3,557,704** | **$1,565,299** | **$7,847,773** | **$2,593,352** | | Stock-based compensation | $954,400 | $670,138 | $1,626,718 | $1,334,089 | | **Adjusted EBITDA** | **$4,512,104** | **$2,235,437** | **$9,474,491** | **$3,927,441** | | Diluted Adjusted EBITDA per share | $0.08 | $0.04 | $0.17 | $0.07 |