Q1 2025 Financial Performance - Net sales increased by 10% to $122.8 million[27] - Gross margin decreased from 37.1% to 33.2%[27] - Net income decreased by 12% to $4.8 million, with net income margin decreasing from 4.9% to 3.9%[27] - Adjusted EBITDA decreased by 8% to $21.2 million, with Adjusted EBITDA margin decreasing from 20.5% to 17.2%[27] - Free Cash Flow generation decreased to $0.3 million from $7.4 million in the prior year[27] Segment Performance - Debit and Credit net sales increased from $88.0 million to $96.5 million, while operating income decreased from $22.8 million to $21.7 million[33] - Prepaid Debit net sales increased from $24.2 million to $26.7 million, while operating income increased from $8.0 million to $8.7 million[35] Balance Sheet and Outlook - Net Leverage Ratio was 3.1x as of March 31, 2025[40] - The company affirmed its 2025 full-year outlook, expecting a mid-to-high single-digit increase in net sales and Adjusted EBITDA[11, 46] Strategic Initiatives - CPI acquired Arroweye Solutions, Inc on May 6, 2025, with expected revenues in the mid-$50 million range on an annualized basis[19, 21] - The company is focused on innovation and diversification to expand addressable markets[15]

Exhibit 2.1 EXECUTION VERSION AGREEMENT AND PLAN OF MERGER by and among CPI CG INC., as Parent APOLLO MERGER SUBSIDIARY, INC., as Merger Sub, ARROWEYE SOLUTIONS, INC., as Company, and WT REPRESENTATIVE LLC, as Holder Representative May 6, 2025 1 | | | Page | | --- | --- | --- | | | ARTICLE I. CERTAIN DEFINITIONS; CONSTRUCTION | 2 | | 1.1 | Certain Definitions | 2 | | 1.2 | Additional Terms | 14 | | 1.3 | Certain Matters of Construction | 17 | | | ARTICLE II. THE MERGER | 18 | | 2.1 | The Merger | 18 | | 2.2 ...

Growth investors focus on stocks that are seeing above-average financial growth, as this feature helps these securities garner the market's attention and deliver solid returns. But finding a great growth stock is not easy at all.By their very nature, these stocks carry above-average risk and volatility. Moreover, if a company's growth story is over or nearing its end, betting on it could lead to significant loss.However, the task of finding cutting-edge growth stocks is made easy with the help of the Zacks ...

Shares of CPI Card Group Inc. (PMTS) have gained 1.3% over the past four weeks to close the last trading session at $29.03, but there could still be a solid upside left in the stock if short-term price targets of Wall Street analysts are any indication. Going by the price targets, the mean estimate of $37 indicates a potential upside of 27.5%.The mean estimate comprises four short-term price targets with a standard deviation of $2.94. While the lowest estimate of $33 indicates a 13.7% increase from the curr ...

Fourth Quarter 2024 Investor Presentation March 4, 2025 Cautionary Statements These risks and uncertainties include, but are not limited to: (i) risks relating to our business and industry, such as a deterioration in general economic conditions, including due to inflationary conditions, resulting in reduced consumer confidence and business spending, and a decline in consumer credit worthiness impacting demand for our products; the unpredictability of our operating results, including an inability to anticipa ...

Financial Data and Key Metrics Changes - Net sales increased by 22% in Q4 2024, driven by strong performance in the prepaid segment and growth in debit and credit card volumes [24][25] - Adjusted EBITDA increased by 10%, while net income more than doubled [24] - Full-year net sales increased by 8%, with a 4% increase from debit and credit segments [28][32] - Gross profit for the full year increased by 10%, with gross margin rising from 35.0% to 35.6% [29] Business Line Data and Key Metrics Changes - Prepaid business grew by 26% for the year, exceeding $100 million in net sales, driven by demand for fraud prevention solutions and healthcare payment solutions [12][24] - Debit and credit business increased by 4% for the year, with strong growth in the second half, particularly in eco-focused contactless cards [12][28] - Income from operations for the prepaid segment increased by 106% in Q4, while the debit and credit segment's income decreased by 7% [33] Market Data and Key Metrics Changes - The prepaid segment saw a 59% increase in Q4, driven by strong demand for higher-priced fraud-focused packaging solutions [25] - Contactless cards represented approximately 90% of chip card volume in 2024, up from just over 80% in the prior year [28] - The total number of credit and debit cards in the US increased by 9% in 2024, indicating healthy growth in the card business [37][38] Company Strategy and Development Direction - The company aims to be the most trusted partner for innovative payment technology solutions, focusing on customer service, quality, innovation, and diversification [18][20] - Plans to expand into adjacent markets and enhance digital solutions, including healthcare payment solutions and closed-loop prepaid markets [20][21] - Investments in the Indiana factory and other initiatives to support long-term growth while balancing profitability [22][23] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving mid to high single-digit net sales growth in 2025, led by the debit and credit business [16][39] - The channel inventory situation is improving, and the market is expected to normalize during the year [39] - Anticipated adjusted EBITDA growth of mid to high single digits in 2025, with strong free cash flow generation [17][41] Other Important Information - The company generated over $34 million in free cash flow for the full year while increasing capital spending [14][34] - Completed several capital structure actions, including purchasing $9 million of stock and refinancing $285 million of senior notes [15][36] - The net leverage ratio improved to 3.0 times, down from 3.1 times at the end of 2023 [36] Q&A Session Summary Question: Can you provide details on the strong prepaid results and gross margins? - Management highlighted strong demand for higher-value packaging due to fraud protection and significant growth in the healthcare vertical [50][51] - Gross margins increased by 60 basis points, with operating leverage contributing to strong performance in the prepaid segment [52] Question: What is the outlook for inventory clearance and its impact? - Management indicated that inventory levels might increase slightly throughout 2025 but expect to bring the balance down by year-end [55] Question: Can you discuss the closed-loop market and its potential size? - The closed-loop market is believed to be four to five times larger than the open-loop market, presenting a significant opportunity for the company [62] Question: Update on the Indiana facility? - The Indiana facility is on track to be operational in the second half of 2025, with new equipment and automation being implemented [66][67] Question: What is the expected free cash flow for 2025? - Free cash flow is expected to be slightly below 2024 levels due to increased cash interest expense and higher capital spending [73]

Financial Data and Key Metrics Changes - Net sales increased by 22% in Q4 2024, driven by strong performance in the prepaid segment and growth in debit and credit card volumes [24][25] - Adjusted EBITDA rose by 10%, while net income more than doubled, reflecting strong sales growth and a lower effective tax rate [24][27] - Full-year net sales increased by 8%, with prepaid segment growth significantly exceeding expectations [28][32] Business Line Data and Key Metrics Changes - The prepaid business grew by 26% for the year, exceeding $100 million in net sales, driven by demand for fraud prevention solutions and healthcare payment solutions [12][24] - The debit and credit business saw a 4% increase for the year, with strong growth in the second half, particularly in eco-focused contactless cards [12][28] - Gross profit increased by 20% in Q4, although gross margins slightly decreased from 34.4% to 34.1% due to product mix issues [26][27] Market Data and Key Metrics Changes - The U.S. cards in circulation increased at a 9% CAGR over three years, with a 7% increase in general-purpose credit cards in 2024 [37][38] - The total number of credit and debit cards, including general-purpose prepaid cards, also saw a 9% increase for the year [38] Company Strategy and Development Direction - The company refined its strategy to focus on customer emphasis, quality, innovation, and diversification, aiming to expand into adjacent markets [10][18] - The total addressable market has increased from $1.5 billion to approximately $2 billion, with ongoing investments in digital solutions and closed-loop prepaid markets [20][21] - The company plans to invest in its Indiana factory to develop digital solutions and closed-loop capabilities, balancing short-term profitability with long-term growth [22][23] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in 2025, projecting mid to high single-digit net sales growth, primarily from the debit and credit segment [16][39] - The channel inventory situation is improving, and the market is expected to normalize throughout the year [39] - Free cash flow is expected to be slightly below 2024 levels due to increased cash interest expenses and capital spending [41][43] Other Important Information - The company generated over $34 million in free cash flow for the full year while increasing capital spending [14][34] - Significant capital structure actions included purchasing $9 million of stock and refinancing $285 million of senior notes, extending maturities to 2029 [15][36] Q&A Session Summary Question: Can you provide details on the strong prepaid results and gross margins? - Management highlighted strong demand for higher-value packaging in the prepaid segment, particularly in healthcare and eco-friendly cards, contributing to growth [50][51] - Gross margins increased by 60 basis points, with operating leverage in the prepaid segment, although some lower-margin sales affected the debit and credit segment [52][53] Question: What is the company's strategy for penetrating the closed-loop market? - The closed-loop market is larger than the open-loop market, and the company is making investments to expand into this area, expecting to see some impact in late 2025 [62][63] Question: Update on the Indiana facility? - The Indiana facility is on track to be operational in the second half of 2025, with new equipment and automation being implemented [66][67] Question: Expectations for free cash flow in 2025? - Free cash flow is expected to be slightly below 2024 levels due to higher capital expenditures and a return to a normal twelve months of cash interest expense [73][74]

分组1 - CPI Card Group Inc. reported quarterly earnings of $0.57 per share, exceeding the Zacks Consensus Estimate of $0.55 per share, and showing a significant increase from $0.23 per share a year ago, representing an earnings surprise of 3.64% [1] - The company achieved revenues of $125.1 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 3.77%, and up from $102.87 million year-over-year [2] - CPI Card Group has outperformed the S&P 500, with shares increasing about 6.7% since the beginning of the year, while the S&P 500 declined by 0.5% [3] 分组2 - The current consensus EPS estimate for the upcoming quarter is $0.53 on revenues of $123 million, and for the current fiscal year, it is $2.94 on revenues of $516.25 million [7] - The Zacks Industry Rank indicates that the Technology Services sector is currently in the top 28% of over 250 Zacks industries, suggesting a favorable outlook for stocks within this industry [8]

Market Position and Growth - CPI Card Group is a leader in the U.S. payment card solutions market, focusing on debit and credit card production, personalization, and SaaS-based instant issuance services[18]. - The company has increased installations of its Card@Once instant issuance solution from approximately 11,000 customer locations in 2019 to more than 16,000 in 2024, indicating significant growth in this segment[37]. - In 2024, one customer accounted for approximately 18% of total net sales, with nearly two-thirds of net sales coming from the top 10 customers, who have been served for an average of over 10 years[48]. - CPI aims to expand its addressable market by diversifying product offerings and entering non-traditional industry verticals, such as healthcare and the gig economy[25]. - The U.S. payment card solutions market has experienced growth driven by new account openings and stable recurring revenue from card reissuance due to expiration and replacement activities[20]. Product and Technology Development - CPI's eco-focused card solutions, including Second Wave and Earthwise cards, incorporate upcycled materials and address increasing demand for environmentally friendly products[29]. - The company has developed technology integrations with financial institution platform providers and card processors to enhance its digital solutions offerings, including digital push provisioning services[45]. - CPI's comprehensive end-to-end card solutions are integral to many customers' card programs, providing a full suite of products and services while maintaining security requirements[44]. - CPI's proprietary and patented solutions, such as the Card@Once system, provide a competitive advantage by enabling faster card issuance and personalization[45]. - The company aims to diversify its product offerings, including digital solutions, to remain competitive and capitalize on cross-selling opportunities[103]. Supply Chain and Operational Challenges - Approximately 95% of the company's purchased microchips and antennas come from three main suppliers, with 78% sourced from a single supplier[63]. - The company has committed approximately $190 million to a capacity reservation agreement with a chip supplier, with $62 million remaining as of December 31, 2024[64]. - The company has experienced extended production lead times due to labor shortages and supply chain constraints, affecting its ability to meet customer delivery expectations[95]. - Disruptions in the supply chain, including reliance on specific suppliers for critical components, could negatively impact production and customer fulfillment[112]. - The company experienced delays and increased costs during the COVID-19 pandemic, highlighting vulnerabilities in its supply chain[113]. Financial and Regulatory Risks - CPI's substantial indebtedness and covenants may limit its ability to capitalize on business opportunities and impact cash flow management[84]. - The company is subject to various federal and state regulations, including those related to privacy and data security, impacting its operations[68]. - The company may face significant costs related to compliance with evolving data privacy and security laws, which could adversely affect operations and financial results[165]. - The company is subject to PCI Security Standards, and failure to comply could result in loss of eligibility to provide products and services, impacting revenue and profitability[166][168]. - The company may need to raise additional funds in the future, and unfavorable market conditions could limit access to capital, delaying innovation[158]. Environmental, Social, and Governance (ESG) Considerations - The company emphasizes environmental sustainability practices in its operations, aligning with its business model and customer needs[56]. - Stakeholder expectations regarding environmental, social, and governance (ESG) matters may impose additional costs and risks, potentially affecting demand for the company's products[143]. - The company may face challenges in meeting evolving consumer concerns regarding the environmental impact of its products, which could require significant research and development costs[144]. - Future ESG reporting requirements may lead to increased costs for monitoring and compliance, impacting the company's financial condition and operations[146]. - Environmental regulations related to climate change may impose additional costs and liabilities on the company, potentially affecting its financial position and operations[182]. Cybersecurity and Risk Management - The cybersecurity program is based on frameworks established by the National Institute of Standards and Technology (NIST) and focuses on risk management and incident response[205]. - The Security Committee conducts annual cybersecurity risk assessments to prioritize initiatives for enhancing security controls[207]. - The company has implemented third-party risk management controls to mitigate cybersecurity threats associated with service providers[210]. - Regular independent cyber audits are conducted to assess the effectiveness of cybersecurity controls and alignment with industry standards[214]. - The board of directors oversees cybersecurity risk management and receives regular updates on material security risks[215]. Corporate Governance and Ownership - The concentration of ownership by significant stockholders, such as the Tricor Funds, may influence corporate decisions and affect the market price of the company's securities[183]. - The Tricor Funds have the right to designate nominees for the board of directors as long as they own 5% or more of the total shares outstanding[194]. - The company has opted out of Section 203 of the Delaware General Corporation Law, which generally restricts business combinations with stockholders owning 15% or more of voting stock for three years[195]. - The board of directors has the ability to issue preferred stock without stockholder approval, which may hinder changes in control[197]. - Stockholder activism and securities litigation could divert management's attention and resources, potentially hindering the execution of business strategies[191].

Exhibit 99.1 CPI Card Group Inc. Reports Fourth Quarter and Full Year 2024 Results Date: March 4, 2025 Fourth Quarter Net Sales Increased 22% to $125 Million; Net Income Increased 148% to $7 Million; Adjusted EBITDA Increased 10% to $22 Million Full Year Net Sales Increased 8% to $481 Million; Prepaid Debit Net Sales Increased 26% and Exceeded $100 Million Outlook for 2025 Projects Mid-to-high Single-digit Net Sales and Adjusted EBITDA Growth Littleton, CO. March 4, 2025 -- CPI Card Group Inc. (Nasdaq: PMTS ...