Spok(US:SPOK)2025-10-30 20:02Revenue Performance - Total revenue for Q3 2025 was $33.867 million, a decrease of 2.9% compared to $34.870 million in Q3 2024[101] - Wireless revenue decreased by 2.6% to $17.794 million in Q3 2025 from $18.261 million in Q3 2024, primarily due to declines in paging revenue[106] - Software revenue decreased by 3.2% to $16.073 million in Q3 2025 from $16.609 million in Q3 2024, despite an increase in professional services revenue[106] - Paging revenue for the three months ended September 30, 2025, was $16.9 million, a decrease of $688,000 or 3.9% compared to $17.6 million in 2024, driven by a decline in units[111] - The company reported a significant increase in managed services revenue, which rose by 87.4% in Q3 2025 compared to Q3 2024[106] Income and Expenses - Net income for the nine months ended September 30, 2025, was $12.951 million, an increase of 14.4% from $11.321 million in the same period of 2024[101] - Operating income for Q3 2025 was $4.359 million, a decrease of 12.1% from $4.961 million in Q3 2024[101] - Total operating expenses for Q3 2025 were $29.508 million, a slight decrease of 1.3% from $29.909 million in Q3 2024[101] - Operating expenses for technology operations decreased by $0.4 million, or 6.5%, for the three months ended September 30, 2025, compared to the same period in 2024, due to a reduction in active transmitters[117] - Selling and marketing expenses increased by $0.2 million, or 5.7%, for the three months ended September 30, 2025, primarily driven by higher commissions and personnel costs[118] - General and administrative expenses decreased by $0.2 million, or 2.9%, for the three months ended September 30, 2025, while increasing by $1.0 million, or 4.1%, for the nine months ended September 30, 2025[119] Cash Flow and Financial Position - Net cash provided by operating activities for the nine months ended September 30, 2025, was $17.4 million, a decrease of $3.1 million compared to $20.5 million in 2024[132] - Net cash used in investing activities for the nine months ended September 30, 2025, was $1.6 million, reflecting purchases of property and equipment[133] - Net cash used in financing activities for the nine months ended September 30, 2025, was $23.6 million, primarily due to cash distributions to stockholders[134] - As of September 30, 2025, the company held cash and cash equivalents of $21.4 million, with a majority maintained in accounts exceeding insured limits[124] - A regular quarterly cash dividend of $0.3125 per share was declared, amounting to approximately $6.4 million, payable on December 9, 2025[135] Obligations and Debt - As of September 30, 2025, total contractual obligations amount to $11,197,000, with $4,030,000 due within one year[141] - Operating lease obligations total $8,261,000, with $2,680,000 due within one year[141] - Unconditional purchase obligations are $2,936,000, with $1,350,000 due within one year[141] - The company had no outstanding debt and no revolving credit facility as of September 30, 2025[145] Accounting and Estimates - There have been no changes to critical accounting policies affecting significant judgments and estimates since the 2024 Annual Report[144] - The company evaluates contingencies and establishes loss provisions for probable losses that can be reasonably estimated[140] - Management's estimates and assumptions are based on historical experience and other reasonable assumptions[143] - Actual results may differ from estimates under different assumptions or conditions[143] - Related party transactions are discussed in Note 13 of the Condensed Consolidated Financial Statements[142] Operational Metrics - Active transmitters decreased by 5.5% from 3,064 in Q3 2024 to 2,894 in Q3 2025[101] - The number of wireless units in service decreased from 730,000 as of September 30, 2024, to 684,000 as of September 30, 2025[108] - Average Revenue Per User (ARPU) increased to $8.19 in Q3 2025 from $7.95 in Q3 2024[108] Foreign Operations - The company conducts limited business outside the United States, resulting in immaterial exposure to foreign currency exchange rate fluctuations[146]