Financial Performance - Sales decreased by $2,551, or 21%, for the three months ending March 31, 2025, compared to the same period in 2024, with hardware revenues down 18% and services revenues down 22%[116] - Gross profit margin was 46% for the three months ending March 31, 2025, compared to 47% in the same period in 2024, with hardware gross margin increasing by 9%[117] - Net income for the three months ending March 31, 2025, was $3,368, a significant increase of $3,477 compared to a net loss of $109 in the same period in 2024[115] - The company's EBITDA for the quarter was $4,977, while the Adjusted EBITDA was $467, indicating a significant difference due to various adjustments[126] Operating Expenses - Total operating expenses decreased by $665, or 11%, for the three months ending March 31, 2025, driven by reductions in sales and marketing expenses by 15% and general and administrative expenses by 10%[115] - Sales and marketing expenses decreased by $218, or 15%, primarily due to reductions in salaries and trade show activities[118] - General and administrative expenses decreased by $447, or 10%, mainly due to reduced payroll-related expenses and lower facilities costs[119] - The Company recognized $265 in other expenses for the three months ended March 31, 2025, primarily related to legal and severance expenses[122] Revenue Streams - Managed services revenue, including SaaS subscription services, decreased by $527, or 11%, due to a reduction in the quantity of licenses from a single customer[116] - The Company expects continuous growth in recurring SaaS revenue as digital signage adoption expands across vertical markets[109] Cash Flow and Liquidity - The net cash used in operating activities during the three months ended March 31, 2025 was $2,449, compared to net cash provided by operating activities of $1,938 for the same period in 2024[131] - The company generated net cash provided by financing activities of $3,182 during the three months ended March 31, 2025, primarily from borrowings[133] - The company remains dependent on improving cash flows from operations and securing additional sources of liquidity to meet financial obligations[127] - Substantial doubt exists about the company's ability to continue as a going concern over the next twelve months due to current liquidity levels and projected capital needs[130] Debt and Borrowings - As of March 31, 2025, the company had an accumulated deficit of $53,486 and positive working capital of $3,133[127] - The company had $19,238 in outstanding borrowings under the revolving credit facility as of March 31, 2025, with total availability under the facility at $2,862[136] - The effective interest rate on the revolving credit facility at March 31, 2025 was 7.43%[135] Shareholder Actions - The company issued Settlement Warrants to former Reflect stockholders to purchase 777,800 shares at an exercise price of $3.25 per share[140] Advertising and Market Presence - The Company’s platforms deliver approximately 50 million ads daily, showcasing the scale of its digital advertising solutions[110] - For the three months ended March 31, 2025, the company generated a net income of $3,368, which included a $4,775 gain on settlement of contingent liability[131]
Creative Realities(CREX) - 2025 Q1 - Quarterly Report