Financial Data and Key Metrics Changes - The company reported Q3 2025 revenues of $36.3 million, a 24% increase compared to Q3 2024 [5][9] - Recurring revenues grew 11% year-over-year to $31.8 million, while professional services and hardware revenue increased to $4.4 million from $0.7 million in the prior year [9][10] - Gross profit for Q3 was $23.1 million, with gross margins at 64%, down from 67% in the prior year [11] - The net loss for Q3 was $5.4 million, compared to a net loss of $3.9 million in the previous year [12] - Adjusted EBITDA increased 49% to $8.1 million, with an adjusted EBITDA margin of 22% [12][14] Business Line Data and Key Metrics Changes - Organic growth improved sequentially to approximately 4% in Q3 from 1% in Q2, with a 7% organic growth rate excluding HRC/ERTC-related churn [10][11] - Bookings for Q3 declined by 41% year-over-year due to large enterprise deals booked in Q3 2024, but were up 21% when excluding those deals [8] Market Data and Key Metrics Changes - The company noted a slight decline in float revenue due to federal funds rate reductions, but anticipated that increasing client fund balances would help offset this [11] - The Federal Reserve cut rates by a quarter point, with expectations for another cut later in the year [11] Company Strategy and Development Direction - The company is focused on integrating acquisitions and enhancing technology, with the recent launch of Asure Central aimed at improving client experience and cross-selling opportunities [6][16] - The company aims for a medium-term revenue target of $180 million to $200 million, with adjusted EBITDA margins exceeding 30% [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving GAAP profitability in Q4 2025 and for the full year 2026, citing strong demand for human capital management products [15][16] - The company anticipates continued organic growth and margin improvement, with a revenue guidance for 2026 between $158 million and $162 million [13][14] Other Important Information - The company plans to participate in several investor conferences in November and December to enhance investor outreach [3][4] - The integration of Latham Time is on schedule, with expectations for significant revenue synergies [39][40] Q&A Session Summary Question: Can you elaborate on the 2026 outlook regarding organic growth? - Management indicated that the balance sheet is strong and they are not modeling extraordinary enhanced organic growth for 2026, focusing instead on existing acquisitions [19][20] Question: What are the drivers behind the improved organic growth? - Management highlighted that attach rates are a key driver, with a 7% sequential increase in cross-sell results [25][50] Question: How is the integration of Latham Time progressing? - The integration is on schedule, with expectations for significant revenue synergies as they bundle offerings [39][40] Question: What is the expected impact of Asure Central on costs and competitive positioning? - Management noted that Asure Central is expected to reduce legacy support costs and enhance competitive positioning through improved client experience [46][66]

Financial Data and Key Metrics Changes - The company's first quarter revenues were $34.9 million, reflecting a 10% increase compared to the prior year [5][13] - Recurring revenues grew 10% year-over-year to $33.2 million, representing 95% of total revenue [13][30] - Gross profit increased by 9% to $24.6 million, with gross margins remaining consistent at 71% [14] - The net loss for the first quarter was $2.4 million, compared to a net loss of $308,000 in the prior year [15] - Adjusted EBITDA for the first quarter increased to $7.3 million from $6.8 million in the prior year, with an adjusted EBITDA margin of 21% [16] Business Line Data and Key Metrics Changes - Strong performance was noted in payroll tax management, payroll benefits, and marketplace offerings [5][30] - The payroll tax management product has seen continued momentum, with new capabilities launched for large Canadian companies [7][8] - The company reported a 45% increase in new bookings compared to the prior year, with a contracted revenue backlog up 339% year-over-year to $82 million [11][30] Market Data and Key Metrics Changes - The company has a well-diversified U.S. client base, with revenues being more than 95% recurring [29] - The HR compliance segment remains depressed due to the wind down of the ERTC program, but better performance is expected in the second half of 2025 [14][30] Company Strategy and Development Direction - The company is focused on a multi-pronged growth strategy that includes organic growth, enhanced organic growth, and inorganic methods through acquisitions [9][10] - A new $60 million credit facility was finalized to support customer acquisition and drive inorganic growth [18][72] - The company aims to achieve revenues of $180 million to $200 million in the medium term, with adjusted EBITDA margins of 30% or more [26][91] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the business's ability to grow, citing a robust pipeline of opportunities and positive trends in product launches [23][30] - The company anticipates accelerated revenue growth in the second half of 2025, driven by improved attach rates and cross-selling efforts [87] - Management noted that the worst is over regarding the HR compliance segment, with expectations for a strong second half of the year [41][42] Other Important Information - The company has made 16 acquisitions over the past 18 months, primarily focused on customer acquisition and expanding the product suite [19] - The company is leveraging artificial intelligence to enhance customer interactions and product development [27] Q&A Session Summary Question: What are you seeing in terms of productivity with dedicated sales teams? - Management highlighted that attach rates have improved, with a notable example of a client increasing their spend significantly after adopting multiple products [35][36] Question: How much progress have you made on maintaining HR compliance with customers? - Management indicated that retention rates had declined due to the ERTC program but expect to see improvement in the second half of 2025 as the cohort stabilizes [40][41] Question: Any slowdown in pipeline based on economic uncertainty? - Management reported that while sales cycles may have lengthened slightly, the pipeline remains strong, and small businesses are active [48][50] Question: Can you discuss your investments and product roadmap? - Management confirmed ongoing investments in technology and product development, with a focus on enhancing the product suite and cross-selling opportunities [56][61] Question: How should we think about acquisitions with the new credit facility? - Management confirmed two acquisitions in the first quarter and expects an increased cadence in the second half of the year, supported by the new credit facility [70][72] Question: What are the primary drivers for accelerated revenue growth in the back half of the year? - Management cited improved attach rates, a growing contracted backlog, and the ramp-up of enterprise deals as key drivers for expected growth [85][87]

Financial Data and Key Metrics Changes - Total revenue for 2024 increased modestly to $119.8 million, with a 17% increase excluding ERTC revenues [10][23] - Recurring revenues grew by 15% year-over-year, now representing 96% of total revenues compared to 84% in 2023 [11][40] - Fourth quarter total revenues were $30.8 million, a 17% increase year-over-year, while recurring revenue rose by 14% [23] - Gross profit margin for the fourth quarter remained stable at 68%, while full-year gross margins decreased to 69% from 72% [26] Business Line Data and Key Metrics Changes - Payroll tax management product significantly contributed to revenue growth, alongside recent acquisitions [12][24] - Revenue growth was also noted in payroll, time and attendance, and benefits groups, with strong performance from the new insurance offerings [25] - The 401(k) product saw an 86% increase in new bookings compared to the previous year, with a strong contracted backlog growing 17% since the last quarter [18][40] Market Data and Key Metrics Changes - The company anticipates continued growth in the payroll tax management business, with a robust pipeline of enterprise deals [48][78] - The demand environment remains stable, with ongoing hiring trends despite economic volatility [73][76] Company Strategy and Development Direction - The company is focused on replacing one-time ERTC revenues with higher-value recurring revenues through organic growth and acquisitions [11][19] - A multiyear agreement was signed with a leading firm to resell payroll and payroll tax management solutions, enhancing market reach [20] - The introduction of innovative products like AssurePay and the AI agent Luna aims to improve client experience and operational efficiency [16][37] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about entering 2025, highlighting strong momentum and a focus on cross-selling and enhancing attach rates [39][40] - The company is preparing for potential economic headwinds but remains confident in its growth trajectory and client acquisition strategy [76][81] Other Important Information - The company is in early discussions for a credit facility between $20 million to $60 million to support customer acquisition and potential M&A activities [30][62] - Adjusted EBITDA for the fourth quarter increased to $6.2 million, with a margin of 20%, while full-year adjusted EBITDA was $22.5 million [28] Q&A Session Summary Question: Progress on enterprise payroll tax opportunities and sales team productivity - Management reported good progress in enterprise tax sales and noted that the sales team is now fully productive post-ERTC transition [44][50] Question: Importance of closing the credit facility for M&A - The credit facility is crucial for funding customer acquisitions, with most sellers requiring upfront cash payments [56][59] Question: Demand environment and client hiring trends - Management indicated that hiring continues, with a divide between salary levels affecting layoffs, but overall job availability remains strong [72][74] Question: Outlook for Q1 revenue and seasonal business components - Q1 revenue is expected to be flat compared to the previous year, with a conservative approach to professional services [85][90] Question: Details on the SurePay introduction and 401(k) momentum - SurePay is currently being tested with 500 clients, and the 401(k) product is gaining traction as the sales team becomes more specialized [100][110]