Financial Performance - Q2 2025 revenue reached $45 million[15] - Gross profit was $16 million, representing 35% of revenue[16] - Net loss improved by 16% year-over-year (YoY)[18] - Adjusted EBITDA was $03 million, a 76% improvement from Q2 2024[18] Operational Highlights - Precision Logistics Q2 2025 revenue decreased by 14% compared to Q2 2024[12] - VerifyMe Q2 2025 operating costs reduced by 27% compared to Q2 2024[12] - Cash balance at the end of Q2 2025 was $61 million[12] Strategic Initiatives - The company continues to evaluate tuck-in and transformative acquisitions[12] - Marketing and Business Development efforts continue to generate new customers[12] - The company completed integration with e-commerce shopping carts[12]

Financial Performance - VerifyMe's Q1 2025 revenue decreased by 22.6% compared to Q1 2024[13] - Precision Logistics proactive services revenue was 12.6% lower in Q1 2025 compared to Q1 2024[13] - Precision Logistics premium services revenue was 47.1% lower in Q1 2025 compared to Q1 2024, due to a single account insourcing[13] - Q1 2025 net loss was ($0.4M), flat year over year[16] - Q1 2025 Adjusted EBITDA was $0[16] - Gross profit was $1.5M with a 33% margin[16] Financial Position - Cash and cash equivalents were $5.7M at the end of Q1 2025[13, 19] - Convertible note outstanding principal was $0.8M at the end of Q1 2025[13] - Q1 2025 Operating Expenses decreased 28.3% compared to Q1 2024[13] Strategic Initiatives - VerifyMe is continuing efforts to expand revenue with directly contracted PeriShip customers[13] - The company is continuing to optimize its direct customer marketing and sales approach[13] - VerifyMe is in continued conversations with both transformative and tuck-in potential acquisitions[13]

Financial Data and Key Metrics Changes - Revenue for Q1 2025 was $4,500,000, a decrease of approximately 23% compared to $5,800,000 in Q1 2024, primarily due to the discontinuation of TrustCo's operations and a softening of customer shipments [4][12] - Gross profit decreased by $800,000 to $1,500,000 in Q1 2025 from $2,300,000 in Q1 2024, with gross margin at 33% in Q1 2025 compared to 39% in Q1 2024 [12][13] - Operating expenses were reduced by approximately 28% to $2,100,000 in Q1 2025 from $2,900,000 in Q1 2024 [5][13] - The net loss for the quarter was $600,000, or a loss of $0.05 per diluted share, consistent with Q1 2024 [13] Business Line Data and Key Metrics Changes - The decline in revenue was most pronounced in premium services, which were down 47% compared to the same quarter last year [4] - Improvements in gross margin were noted in proactive services within the Precision Logistics segment, indicating potential for organic growth [5] Market Data and Key Metrics Changes - The overall market for e-commerce is experiencing a softening, impacting customer confidence and spending, which in turn affects revenue from proactive customers [46][47] Company Strategy and Development Direction - The company is focusing on three elements for organic growth: optimizing direct customer marketing, developing relationships with additional freight carriers, and integrating with technology platforms related to e-commerce [7][9][10] - The company is exploring both transformative and tuck-in acquisitions to enhance shareholder value, with a strong balance sheet and cash flow supporting these initiatives [10][31] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the challenges posed by the current macroeconomic environment but remains optimistic about the potential for growth through strategic initiatives and a strong cash position [5][58] - The company is not providing specific revenue guidance for the year but anticipates a challenging comparison in Q2 due to prior customer losses [37] Other Important Information - Nancy Meyers, CFO, announced her retirement, with Jennifer Colo set to take over the role, ensuring a smooth transition [16][19] - The company had a cash balance of $5,700,000 at the end of Q1 2025, an increase from $2,800,000 at the end of 2024, with no bank debt [6][14] Q&A Session Summary Question: Capital allocation priorities and organic vs external growth - Management indicated that investments for organic growth are funded by the business and do not require cash from reserves, focusing on integrating with e-commerce platforms [25][26] Question: Revenue generation for the authentication business - The revenue for the authentication business in the quarter was $26,000 [33] Question: Revenue expectations for the rest of the year - Management expects challenging revenue comparisons in Q2 but anticipates easier comparisons in the second half of the year, with a focus on proactive revenue [37][40] Question: Update on new customers and their performance - New customer additions have slowed, and while there is no significant loss of customers, overall softening is observed across the customer base [46][48] Question: Strategic discussions regarding the ink business - Management is open to synergistic acquisitions in the ink business but sees higher value potential in Precision Logistics [50][51] Question: Overall comfort with the company's position compared to a few months ago - Management feels optimistic about the company's opportunities, citing a strong balance sheet and a receptive market environment for new ideas [55][58]