IDT(US:IDT)2023-06-08 16:00Revenue Growth - BOSS Money revenues increased by 28.9% to $19.5 million in Q3 2023 compared to $15.1 million in Q3 2022, and by 39.4% to $54.6 million in the nine months ended April 30, 2023, compared to $39.2 million in the same period last year [135]. - National Retail Solutions (NRS) represented 6.0% of total revenues in Q3 2023, up from 3.5% in Q3 2022, and 6.1% in the nine months ended April 30, 2023, compared to 3.1% in the same period last year [140]. - Fintech segment revenues accounted for 7.3% of total revenues in Q3 2023, up from 5.2% in Q3 2022, and 6.6% in the nine months ended April 30, 2023, compared to 4.4% in the same period last year [134]. - Total revenues for the three months ended April 30, 2023, increased to $18.4 million, a growth of 18.2% compared to $15.6 million in the same period of 2022 [146]. - Recurring revenues for the nine months ended April 30, 2023, reached $52.6 million, reflecting a significant increase of 90.8% from $27.6 million in the prior year [141]. - The net2phone segment contributed 6.2% of total revenues in the three months ended April 30, 2023, up from 4.7% in the same period of 2022 [145]. - net2phone's subscription revenues increased by 20.1% to $17.1 million in the three months ended April 30, 2023, compared to $14.2 million in the same period of 2022 [146]. - Revenues from IDT Digital Payments decreased by $14.9 million or 12.8% to $101.0 million for the three months ended April 30, 2023, compared to $115.9 million in 2022 [155]. - BOSS Revolution Calling revenues fell by $14.2 million or 15.4% to $77.6 million for the three months ended April 30, 2023, down from $91.8 million in 2022 [156]. - IDT Global revenues decreased by $12.6 million or 18.8% to $54.5 million for the three months ended April 30, 2023, compared to $67.1 million in 2022 [157]. - Revenues from international operations accounted for 28% of consolidated revenues in the three months ended April 30, 2023 [199]. Expenses and Costs - Direct cost of revenues for BOSS Money increased by 39.8% to $9.2 million in Q3 2023, reflecting the revenue growth in the same period [136]. - Selling, general and administrative expenses for the Fintech segment decreased as a percentage of revenue to 60.5% in Q3 2023 from 64.9% in Q3 2022 [137]. - Selling, general and administrative expenses as a percentage of revenue decreased to 70.6% in the three months ended April 30, 2023, down from 73.5% in the same period of 2022 [143]. - Direct costs of revenues for the three months ended April 30, 2023, increased to $3.0 million, a rise of 13.7% from $2.7 million in the same period of 2022 [146]. - Direct cost of revenues decreased by $41.2 million or 17.4% to $195.4 million for the three months ended April 30, 2023, compared to $236.6 million in 2022 [158]. - Selling, general and administrative expenses decreased by $1.6 million or 6.0% to $26.0 million for the three months ended April 30, 2023, compared to $27.6 million in 2022 [159]. - Stock-based compensation expense increased to $1.7 million for the three months ended April 30, 2023, compared to $1.2 million in 2022, primarily due to the grant of deferred stock units [167]. Operational Performance - Active POS terminals and payment processing accounts are key metrics for measuring NRS's customer base, indicating growth in the segment [128]. - Active POS terminals grew to 23.9 thousand, representing a 34% increase from 17.9 thousand in the same period last year [143]. - Loss from operations for net2phone improved to $(0.4) million in the three months ended April 30, 2023, a decrease of 83.3% from $(2.3) million in the same period of 2022 [146]. - Minutes of use for BOSS Revolution Calling decreased by 141 million or 20.4% to 549 million for the three months ended April 30, 2023, compared to 690 million in 2022 [156]. - Minutes of use for IDT Global decreased by 436 million or 23.4% to 1,428 million for the three months ended April 30, 2023, compared to 1,864 million in 2022 [157]. - Income from operations for the three months ended April 30, 2023, was $12.9 million, a decrease of $4.7 million or 26.5% compared to $17.6 million in 2022 [155]. - Income from operations for the three months ended April 30, 2023, was $10.4 million, a decrease of 22.1% from $13.3 million in the same period of 2022 [169]. Financial Position - The company recognized a gain of $1.6 million on the write-off of contingent consideration payments related to the Leaf acquisition in the nine months ended April 30, 2023 [139]. - Net income attributable to IDT Corporation for the nine months ended April 30, 2023, was $32.5 million, representing a significant increase of 232.3% from $9.8 million in the same period of 2022 [169]. - Cash, cash equivalents, debt securities, and current equity investments totaled $138.5 million as of April 30, 2023, with working capital of $88.3 million [175]. - Capital expenditures for the nine months ended April 30, 2023, were $16.0 million, with expectations of $21 million to $22 million for the twelve-month period ending April 30, 2024 [185]. - Gross trade accounts receivable increased to $72.1 million at April 30, 2023, from $70.2 million at July 31, 2022 [180]. - Deferred revenue decreased to $33.9 million at April 30, 2023, from $36.5 million at July 31, 2022, primarily due to decreases in specific product lines [181]. - Customer deposit liabilities at IDT Financial Services increased to $86.1 million at April 30, 2023, from $85.8 million at July 31, 2022 [182]. - The company expects cash from operations and existing cash reserves to meet working capital and capital expenditure requirements for the next twelve months [174]. - Losses on investments, net for the three months ended April 30, 2023, included unrealized gains of $11,000, contrasting with unrealized losses of $0.6 million in the same period of 2022 [171]. Strategic Initiatives - The company plans to adopt new accounting standards related to credit losses on August 1, 2023, but does not expect a material impact on financial statements [125]. - The company continues to monitor the potential impact of COVID-19 on its operations, although the World Health Organization declared an end to the emergency in May 2023 [127]. - The introduction of new platform functionalities for BOSS Money has enabled more flexible pricing strategies, contributing to revenue growth [135]. - The company is considering spin-offs and other potential dispositions of certain subsidiaries, though no assurance of completion is provided [197]. - The company intends to make strategic investments and acquisitions to expand its business portfolio [198]. - The company is required to comply with various covenants and maintain certain financial ratios under the revolving credit facility [192]. - IDT Telecom entered into a revolving credit facility with TD Bank for up to $25.0 million, with no amounts outstanding as of April 30, 2023 [192]. - In the nine months ended April 30, 2023, IDT Telecom borrowed and repaid an aggregate of $2.4 million under the credit facility [192]. - NRS sold 2.5% of its outstanding capital stock for $10 million to Alta Fox on September 29, 2021 [193]. - In the nine months ended April 30, 2023, the company repurchased 280,130 shares of Class B common stock for $7.5 million [195]. - The company paid $0.3 million to repurchase 13,547 shares of Class B common stock for employee tax obligations in the nine months ended April 30, 2023 [196]. - The value of the company's debt and equity security holdings was $58.0 million as of April 30, 2023, representing 11% of total assets [200].