Financial Performance - Total net revenue for the three months ended June 30, 2024, was $13,797,000, a decrease of 8.4% compared to $15,692,000 for the same period in 2023[7]. - Net income for the three months ended June 30, 2024, was $896,000, down 52.2% from $1,875,000 in the same period last year[8]. - Total revenue for the six months ended June 30, 2024, was $26,873,000, down 11.5% from $30,448,000 in the same period of 2023[21]. - Professional services revenue for the six months ended June 30, 2024, was $12,799,000, a decrease of 18.3% from $15,695,000 in 2023[21]. - Total revenue for the three and six month periods ended June 30, 2024 was $13,797,000 and $26,873,000, representing decreases of 12% compared to the respective periods in 2023[61]. - Revenue from services decreased by 1% and 6% for the three and six month periods ended June 30, 2024, primarily due to lower professional services revenue from Goldman Sachs Group, Inc.[62]. - Revenue from products, primarily software license fees, was $0 for the three and six month periods ended June 30, 2024, compared to $1,794,000 in the respective periods of 2023[64]. Assets and Liabilities - Total current assets decreased to $40,681,000 as of June 30, 2024, from $44,489,000 as of December 31, 2023, representing a decline of 8.5%[4]. - Total assets decreased to $61,557,000 as of June 30, 2024, from $63,826,000 as of December 31, 2023, a reduction of 3.5%[5]. - Total current liabilities decreased to $8,007,000 as of June 30, 2024, from $9,540,000 as of December 31, 2023, a decrease of 16.1%[4]. - Total stockholders' equity decreased to $50,849,000 as of June 30, 2024, from $52,704,000 as of December 31, 2023, a decline of 3.5%[5]. - Cash and cash equivalents decreased to $22,589,000 as of June 30, 2024, from $26,918,000 as of December 31, 2023, a decrease of 16.5%[4]. Cash Flow and Operating Activities - Cash provided by operating activities for the six months ended June 30, 2024, was $2,341,000, compared to $15,121,000 in 2023, reflecting a significant decline[13]. - The company reported a net cash decrease of $4,329,000 for the six months ended June 30, 2024, compared to an increase of $10,606,000 in the same period of 2023[15]. - The company’s cash paid for operating leases for the six months ended June 30, 2024, was $659,000, slightly down from $674,000 for the same period in 2023[45]. Shareholder Activities - The company had approximately $11.0 million authorized for future repurchases of common stock as of June 30, 2024[10]. - Share repurchases amounted to $3.7 million for the six months ended June 30, 2024, with approximately $11.0 million of authorized share repurchases remaining[72]. - A total of 147,040 shares were repurchased during the three months ended June 30, 2024, at an average price of $14.08 per share[80]. Risks and Challenges - Goldman Sachs Group, Inc. accounted for 61% of the company's consolidated revenues for the six months ended June 30, 2024, posing a risk of revenue loss if contract obligations are not met[75]. - The company faces risks from potential delays in software development projects, which could increase costs and reduce revenue[76]. - Increased federal and state regulations may lead to higher costs and affect customer relationships, impacting revenue growth[76]. - The company is exposed to risks from global financial market instability, which could delay customer purchasing decisions[75]. - The company has identified potential security breaches as a risk that could lead to material losses exceeding insurance coverage[75]. - Competitive pressures may result in prospective customers opting for alternative solutions, negatively affecting revenue and profits[76]. - Future capital needs remain uncertain, with potential challenges in securing additional capital on acceptable terms[76]. Income and Expenses - Basic earnings per share for the three months ended June 30, 2024, was $0.11, down from $0.22 in the same period of 2023[7]. - The company reported a total comprehensive income of $865,000 for the three months ended June 30, 2024, compared to $1,869,000 for the same period in 2023[8]. - Stock-based compensation expense for the six months ended June 30, 2024, was $585,000, up from $150,000 in the same period of 2023[27]. - Total operating expenses decreased by 4% and 3% for the three and six month periods ended June 30, 2024, respectively, compared to the same periods in 2023[66]. Other Financial Metrics - The effective tax rates for the three and six months ended June 30, 2024 were 24.4% and 24.8%, compared to 24.8% for the respective periods in 2023[68]. - The company holds a 26.5% ownership interest in a privately held company, with a carrying value of $3,624,000 as of June 30, 2024[26]. - The company recorded losses of $199,000 and $438,000 for the three and six months ended June 30, 2024, respectively, related to its equity investment[26]. - The total fair value of cash equivalents and marketable securities as of June 30, 2024, was $22,955,000, with $17,698,000 in money market accounts and $5,257,000 in corporate, municipal debt, and treasury securities[39]. - The company reported a total lease liability of $3,849,000 as of June 30, 2024, with operating lease payments due in 2024 amounting to $724,000[46]. - The weighted average remaining lease term increased to 3.5 years as of June 30, 2024, from 2.8 years as of December 31, 2023[44]. - The company had six marketable securities in an unrealized loss position as of June 30, 2024, but did not identify any that were other-than-temporarily impaired[41]. - The estimated fair value of options granted was calculated using the Black-Scholes option pricing model, with an aggregate intrinsic value of $390,250 for in-the-money options as of June 30, 2024[29]. - The company experienced a decrease in general and administrative costs, reporting $238,000 for the six months ended June 30, 2024, compared to $223,000 for the same period in 2023[47]. - For the six months ended June 30, 2024, the cost of revenue was $659,000, an increase from $674,000 for the same period in 2023[47].
CoreCard(CCRD) - 2024 Q2 - Quarterly Report