CoreCard(CCRD) - 2024 Q4 - Annual Report

Revenue and Financial Performance - Total revenue for the year ended December 31, 2024, was $57,399,000, representing a 2$57,399 million, a 2.5% increase from $56,004 million in 2023[148]. - Revenue from services was$54,559,000 in 2024, a 1% increase from 2023 revenue of $54,210,000[66]. - Revenue from products, including software license fees, was$2,840,000 in 2024, an increase of 58% from 2023 revenue of $1,794,000[66]. - Goldman Sachs Group, Inc. represented 62$54,892,000 in 2024, up from $53,915,000 in 2023, reflecting a growth of 1.8$2,840,000 in 2024 from $1,794,000 in 2023, representing a growth of 58.3$26,015,000 in 2024 from $28,237,000 in 2023, a decline of 7.8$24,034,000 in 2024 from $22,439,000 in 2023, a growth of 7.1$5,448 million, up 60.4% from $3,395 million in 2023[150]. - Earnings per share (EPS) for 2024 was$0.68, compared to $0.40 in 2023, reflecting a 70$6,539 million in 2024, a 23.1% rise from $5,311 million in 2023[148]. - Total comprehensive income for 2024 was$5,323 million, compared to $3,488 million in 2023, marking a 52.7$35,770 million, a decrease from $36,571 million in 2023[148]. - The company reported a depreciation expense of$3,566 million in 2024, down from $6,256 million in 2023[156]. - Amortization expense related to intangible assets was$34,000 in 2024, down from $133,000 in 2023, with the carrying amount of intangible assets net of accumulated amortization at$0 in 2024[167]. - Stock-based compensation expense increased significantly to $1,308,000 in 2024 from$150,000 in 2023[196]. Cash Flow and Investments - Cash balance decreased to $19,481,000 at December 31, 2024, from$26,918,000 at December 31, 2023, with cash provided by operations dropping to $5,801,000 from$16,810,000[71]. - The company invested $2,186,000 in publicly traded securities in 2024, compared to$2,521,000 in 2023[72]. - Cash used for acquiring computer equipment and software development for a new processing platform was $4,908,000 in 2024[73]. - The company has approximately$7.1 million of authorized share repurchases remaining at December 31, 2024[49]. - The company repurchased $7,638 million of common stock in 2024, compared to$3,653 million in 2023[156]. - The company has been audited by Nichols, Cauley and Associates, LLC since 2015, ensuring compliance with PCAOB standards[142]. Workforce and Operations - CoreCard maintains a workforce of approximately 1,000 employees across its offshore operations in India, Romania, the UAE, and Colombia for software development and processing services support[34]. - The company operates in multiple countries, with significant personnel located in India, Romania, the UAE, and Colombia[62]. - The company’s facilities are deemed adequate for the foreseeable future, with leases covering approximately 27,000 square feet in Norcross, Georgia, and additional locations in Colombia, UAE, and India[43]. Intellectual Property and Compliance - The company has one U.S. patent covering aspects of its core software platform and actively protects its intellectual property through trademarks and trade secrets[33]. - CoreCard's software products help customers comply with various governmental regulations, including the Bank Secrecy Act and Anti-Money Laundering regulations[28]. - The company has established multiple secure processing data centers and is compliant with Payment Card Industry (PCI) Data Security Standards[20]. Risks and Challenges - The transition of Goldman Sachs' General Motors co-branded credit card to a new issuer is expected to close in 2025, potentially impacting future revenues[96]. - Weakness in global financial markets may lead to delays in software purchases by potential customers[96]. - Increased federal and state regulations could result in losses and additional cash requirements for the company[103]. - Delays in software development projects may lead to postponed implementations and delayed payments, increasing costs and reducing revenue[103]. - The company faces risks from security breaches that could expose confidential customer information and lead to material losses[103]. - Competitive pressures may cause prospective customers to choose alternative product solutions, resulting in lower revenue and profits[103]. Financial Position and Equity - Total assets decreased from $63,826,000 in 2023 to$62,338,000 in 2024, a decline of approximately 2.34%[145]. - Cash and cash equivalents decreased by 27.06% from $26,918,000 in 2023 to$19,481,000 in 2024[145]. - Accounts receivable increased by 36.00% from $7,536,000 in 2023 to$10,235,000 in 2024[145]. - Total current liabilities decreased from $9,540,000 in 2023 to$8,452,000 in 2024, a reduction of approximately 11.43%[145]. - Stockholders' equity decreased from $52,704,000 in 2023 to$51,697,000 in 2024, a decline of approximately 1.91%[145]. - Additional paid-in capital increased from $16,621,000 in 2023 to$17,928,000 in 2024, an increase of approximately 7.86%[145]. - Treasury stock increased from $20,359,000 in 2023 to$27,997,000 in 2024, an increase of approximately 37.73%[145]. - Accumulated income increased from $56,320,000 in 2023 to$61,768,000 in 2024, an increase of approximately 9.73%[145]. Future Outlook - The company anticipates steady growth in its Processing Services business in 2025 and future years, driven by increased demand for prepaid and credit card processing[20]. - The company does not expect to pay any regular or special dividends in the foreseeable future, focusing on liquidity and potential opportunities to expand its FinTech business[75]. - The effective tax rate decreased to 21.1% in 2024 from 24.5% in 2023, with expectations for future rates to be within 24-26%[70]. - The company is evaluating the impact of adopting ASU 2024-03, effective for fiscal years beginning after December 15, 2026, which requires additional expense category disclosures[203].