Paysign(PAYS) - 2025 Q2 - Quarterly Results

Executive Summary & Q2 2025 Highlights 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 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] - Pharma patient affordability business grew revenue by 190%, ending the quarter with 97 active programs and expecting 30-40 more by year-end[3] - 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] Key Financial & Operational Highlights (Q2 2025) 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] Detailed Second Quarter 2025 Results 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 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] - 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] Cost of Revenues and Gross Profit 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] - 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] Operating Expenses 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] - Depreciation and amortization expense increased mainly due to continued capitalization of new software development costs and equipment purchases related to processing platform enhancements[8] Other Income and Income Tax 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] - 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] Net Income and Non-GAAP Metrics (EBITDA, Adjusted EBITDA) 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] Financial Position: Balance Sheet at June 30, 2025 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 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] - 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] 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 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 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 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][13] - 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] Third Quarter 2025 Outlook 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] Company Information 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 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] Forward-Looking Statements Disclaimer 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] - 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] About Paysign, Inc. 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] - 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][20] - 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] Contacts Contact information for investor and media relations is provided Condensed Consolidated Financial Statements (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 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 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 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] - EBITDA is defined as earnings before interest, taxes, depreciation, and amortization expense, while Adjusted EBITDA further excludes stock-based compensation charges[26] | 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 |