Market Newsdesk

May 6, 2025 7:18 am

Zoetis Announces First Quarter 2025 Results

Zoetis Announces First Quarter 2025 Results

Reports Revenue of $2.2 Billion, Growing 1%, and Net Income of $631 Million, or $1.41 per Diluted Share, Increasing 5% and 8%, Respectively, on a Reported Basis for First Quarter 2025

Delivers 9% Organic Operational Growth in Revenue and 6% Organic Operational Growth in Adjusted Net Income for First Quarter 2025

Reports Adjusted Net Income of $662 Million, or Adjusted Diluted EPS of $1.48, for First Quarter 2025

Updates Full Year 2025 Revenue Guidance to $9.425 – $9.575 Billion to Reflect the Impact of Foreign Exchange and Maintains Guidance for Organic Operational Revenue Growth of 6% to 8%

Updates Full Year 2025 Guidance for Organic Operational Growth in Adjusted Net Income to 5% to 7% to Reflect the Impact of Enacted Tariffs

Updates Guidance for Diluted EPS on an Adjusted Basis to $6.20 to $6.30 to Reflect the Impact of Foreign Exchange and Enacted Tariffs

PARSIPPANY, N.J.–(BUSINESS WIRE)–Zoetis Inc. (NYSE:ZTS) today reported its financial results for the first quarter of 2025 and updated its full year 2025 guidance.

The company reported revenue of $2.2 billion for the first quarter of 2025, an increase of 1% compared with the first quarter of 2024. On an organic operational¹ basis, revenue for the first quarter of 2025 increased 9% compared with the first quarter of 2024. Net income for the first quarter of 2025 was $631 million, or $1.41 per diluted share, an increase of 5% and 8%, respectively, on a reported basis.

Adjusted net income² for the first quarter of 2025 was $662 million, or $1.48 per diluted share, an increase of 4% and 7%, respectively, on a reported basis, and an increase of 6%and 8%, respectively, on an organic operational basis. Adjusted net income for the first quarter of 2025 excludes the net impact of $31 million for purchase accounting adjustments, acquisition and divestiture-related costs and certain significant items.

EXECUTIVE COMMENTARY

“Zoetis achieved strong results for the first quarter of 2025, driven by demand for our innovative products and our focus on delivering for our customers. It is a testament to our colleagues’ unwavering dedication and excellence in agility that we reported organic operational revenue growth of 9%,” said Kristin Peck, Chief Executive Officer of Zoetis. “These results reinforce the essential nature of our business, the strength of our diversified portfolio across markets and species and the preference for our innovative products. While the external environment continues to evolve, we remain agile, disciplined and focused on supporting our customers and the animals in their care while continuing our commitment to deliver value to shareholders.”

QUARTERLY HIGHLIGHTS

Zoetis organizes and manages its commercial operations across two segments: United States (U.S.) and International. Within these segments, the company delivers a diverse portfolio of products for companion animals and livestock, tailored to local trends and customer needs. In the first quarter of 2025:

Revenue in the U.S. segment was $1.2 billion, an increase of 2% compared with the first quarter of 2024 and an increase of 6% on an organic operational basis. Sales of companion animal products increased 8%, driven by Simparica Trio^®, the company’s flea tick and heartworm combination product, key dermatology products Apoquel^® and Cytopoint^®, and monoclonal antibody (mAb) products for osteoarthritis (OA) pain, Librela^® for dogs and Solensia^® for cats. Other contributing factors to growth include diagnostic products, which benefited from a favorable comparative period due to last year’s channel strategy change. This was offset by lower vaccine sales as a result of a competitor stock out in the same quarter last year. Sales of livestock products declined 21% in the quarter, largely due to the divestiture of the medicated feed additive (MFA) product portfolio and related assets. On an organic operational basis, sales of livestock products declined 2%.

Revenue in the International segment was $1.0 billion, flat on a reported basis and an increase of 11% on an organic operational basis compared with the first quarter of 2024. Sales of companion animal products grew 4% on a reported basis and 10% operationally³. Growth in the quarter was driven by the company’s innovative companion animal products including, parasiticides products Simparica^® and Simparica Trio, key dermatology products Apoquel and Cytopoint, and monoclonal antibodies for OA pain, Librela and Solensia. Sales of livestock products declined 4% on a reported basis, largely due to foreign exchange and the divestiture of the medicated feed additive (MFA) product portfolio and related assets. On an organic operational basis, sales of livestock products increased 12%, driven largely by sales of the company’s cattle products in Brazil and other emerging markets, as well as increased vaccine sales in key salmon markets.

INVESTMENTS IN GROWTH

Zoetis continues to advance innovation and care for animals across the globe. Since its last quarterly earnings announcement, Simparica Trio gained a new label indication in the U.S. to prevent Dipylidium caninum (flea tapeworm) infections by killing Ctenocephalides felis vector fleas in treated dogs. With this approval, Simparica Trio is the only canine combination parasiticide indicated to prevent flea tapeworm infections, at the source, by killing vector fleas before transmission. Simparica Trio also received approval in South Korea. Revolution^®Plus (selamectin/sarolaner), a topical combination product that treats ticks, fleas, ear mites, lice and gastrointestinal worms and prevents heartworm disease in cats, received approval in the U.K. for an additional claim related to efficacy against notoedres mange.

On the livestock side of the business, the company received a conditional license for its Avian Influenza Vaccine, H5N2 Subtype, Killed Virus, for use in chickens, in the U.S. and Canada. Zoetis also received approval in the EU and Brazil for Poulvac^® Procerta^® HVT-IBD-ND, a part of the company’s recombinant vector vaccine portfolio for poultry, which provides early, robust protection against Marek’s, infectious bursal and Newcastle disease viruses with one dose. Poulvac Procerta HVT-IBD, which provides protection against Marek’s and infectious bursal viruses, was approved in the U.K. Also in the U.K., Poulvac IB Primer and Poulvac IB QX received approval for an association claim that includes cross protection against 793B and variant 2 strains of infectious Bronchitis virus (IBV) and Suvaxyn^® PRRS MLV received approval for an additional claim related to use in lactating sows.

FINANCIAL GUIDANCE

Zoetis is updating its full year 2025 guidance.

Revenue between $9.425 billion to $9.575 billion (maintains guidance for organic operational growth of 6% to 8%)

Reported net income between $2.630 billion to $2.680 billion

Adjusted net income between $2.775 billion to $2.825 billion (organic operational growth of 5% to 7%)

Reported diluted EPS of $5.85 to $5.95

Adjusted diluted EPS between $6.20 to $6.30

This guidance reflects foreign exchange rates as of late April and the impact of enacted tariffs. Additional details on guidance are included in the financial tables and will be discussed on the company’s conference call this morning.

WEBCAST & CONFERENCE CALL DETAILS

Zoetis will host a webcast and conference call at 8:30 a.m. (ET) today, during which company executives will review first quarter 2025 results, discuss financial guidance and respond to questions from financial analysts. Investors and the public may access the live webcast and corresponding slides by visiting the Zoetis website at http://investor.zoetis.com/events-presentations. A replay of the webcast will be archived and made available on May 6, 2025.

About Zoetis

As the world’s leading animal health company, Zoetis is driven by a singular purpose: to nurture our world and humankind by advancing care for animals. After innovating ways to predict, prevent, detect, and treat animal illness for more than 70 years, Zoetis continues to stand by those raising and caring for animals worldwide – from veterinarians and pet owners to livestock producers. The company’s leading portfolio and pipeline of medicines, vaccines, diagnostics and technologies make a difference in over 100 countries. A Fortune 500 company, Zoetis generated revenue of $9.3 billion in 2024 with approximately 13,800 employees. For more information, visit www.zoetis.com.

¹Organic operational results (a non-GAAP financial measure) is defined as results excluding the impact of foreign exchange and certain acquisitions and divestitures.

²Adjusted net income and its components and adjusted diluted earnings per share (non-GAAP financial measures) are defined as reported net income and reported diluted earnings per share, excluding purchase accounting adjustments, acquisition and divestiture-related costs and certain significant items.

³Operational results (a non-GAAP financial measure) is defined as results excluding the impact of foreign exchange.

DISCLOSURE NOTICES

Forward-Looking Statements: This press release contains forward-looking statements, which reflect the current views of Zoetis with respect to: business plans or prospects, future operating or financial performance, future guidance, future operating models; R&D costs; timing and likelihood of success; expectations regarding products, product approvals or products under development and expected timing of product launches; expectations regarding competing products; expectations regarding financial impact of divestitures; disruptions in our global supply chain; expectations regarding the performance of acquired companies and our ability to integrate new businesses; expectations regarding the financial impact of acquisitions; future use of cash, dividend payments and share repurchases; foreign exchange rates, tax rates, tariffs, changes in tax regimes and laws and any changes thereto; and other future events. These statements are not guarantees of future performance or actions. Forward-looking statements are subject to risks and uncertainties. If one or more of these risks or uncertainties materialize, or if management’s underlying assumptions prove to be incorrect, actual results may differ materially from those contemplated by a forward-looking statement. Forward-looking statements speak only as of the date on which they are made. Zoetis expressly disclaims any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. A further list and description of risks, uncertainties and other matters can be found in our most recent Annual Report on Form 10-K, including in the sections thereof captioned “Forward-Looking Statements and Factors That May Affect Future Results” and “Item 1A. Risk Factors,” in our Quarterly Reports on Form 10-Q and in our Current Reports on Form 8-K. These filings and subsequent filings are available online at www.sec.gov, www.zoetis.com, or on request from Zoetis.

Use of Non-GAAP Financial Measures: We use non-GAAP financial measures, such as adjusted net income, adjusted diluted earnings per share, operational results (which exclude the impact of foreign exchange) and organic operational results (which exclude the impact of foreign exchange and certain acquisitions and divestitures), to assess and analyze our results and trends and to make financial and operational decisions. We believe these non-GAAP financial measures are also useful to investors because they provide greater transparency regarding our operating performance. The non-GAAP financial measures included in this press release should not be considered alternatives to measurements required by GAAP, such as net income, operating income, and earnings per share, and should not be considered measures of liquidity. These non-GAAP financial measures are unlikely to be comparable with non-GAAP information provided by other companies. Reconciliations of non-GAAP financial measures and the most directly comparable GAAP financial measures are included in the tables accompanying this press release and are posted on our website at www.zoetis.com.

Internet Posting of Information: We routinely post information that may be important to investors on the ‘Investor Relations’ section of our website at www.zoetis.com, as well as on LinkedIn, Facebook, X (formerly Twitter) and YouTube. We encourage investors and potential investors to consult our website regularly and to follow us on social media for company news and information.

ZTS-COR

ZTS-IR

ZTS-FIN

ZOETIS INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME^(a)

(UNAUDITED)

(millions of dollars, except per share data)

Three Months Ended

March 31,

2025

2024

% Change

Revenue

$

2,220

$

2,190

1

Costs and expenses:

Cost of sales

622

643

(3

)

Selling, general and administrative expenses

563

547

3

Research and development expenses

157

162

(3

)

Amortization of intangible assets

32

37

(14

)

Restructuring charges and certain acquisition and divestiture-related costs

—

4

*

Interest expense, net of capitalized interest

54

58

(7

)

Other (income)/deductions–net

(18

)

(8

)

*

Income before provision for taxes on income

810

747

8

Provision for taxes on income

179

148

21

Net income before allocation to noncontrolling interests

631

599

5

Less: Net income/(loss) attributable to noncontrolling interests

—

—

*

Net income attributable to Zoetis Inc.

$

631

$

599

5

Earnings per share attributable to Zoetis—basic

$

1.41

$

1.31

8

Earnings per share attributable to Zoetis—diluted

$

1.41

$

1.31

8

Weighted-average shares used to calculate earnings per share

Basic

447.6

458.0

Diluted

448.0

458.8

(a)^{The condensed consolidated statements of income present the three months ended March 31, 2025 and 2024. Subsidiaries operating outside the United States are included for the three months ended February 28, 2025 and February 29, 2024.}

* Calculation not meaningful.

ZOETIS INC.

RECONCILIATION OF GAAP REPORTED TO NON-GAAP ADJUSTED INFORMATION

CERTAIN LINE ITEMS

(UNAUDITED)

(millions of dollars, except per share data)

Three Months Ended March 31, 2025

GAAP Reported^(a)

Purchase Accounting Adjustments

Acquisition and Divestiture- Related Costs

Certain Significant Items⁽¹⁾

Non-GAAP Adjusted^(b)

Cost of sales

$

622

$

(1

)

$

—

$

(1

)

$

620

Gross profit

1,598

1

—

1

1,600

Selling, general and administrative expenses

563

(3

)

—

(6

)

554

Research and development expenses

157

—

—

—

157

Amortization of intangible assets

32

(28

)

—

—

4

Restructuring charges and certain acquisition and divestiture-related costs

—

—

—

—

—

Other (income)/deductions–net

(18

)

—

—

1

(17

)

Income before provision for taxes on income

810

32

—

6

848

Provision for taxes on income

179

7

—

—

186

Net income attributable to Zoetis

631

25

—

6

662

Earnings per common share attributable to Zoetis–diluted

1.41

0.06

—

0.01

1.48

Three Months Ended March 31, 2024

GAAP Reported^(a)

Purchase Accounting Adjustments

Acquisition and Divestiture- Related Costs

Certain Significant Items⁽¹⁾

Non-GAAP Adjusted^(b)

Cost of sales

$

643

$

(1

)

$

—

$

—

$

642

Gross profit

1,547

1

—

—

1,548

Selling, general and administrative expenses

547

(3

)

—

—

544

Research and development expenses

162

(1

)

—

—

161

Amortization of intangible assets

37

(32

)

—

—

5

Restructuring charges and certain acquisition and divestiture-related costs

4

—

—

(4

)

—

Other (income)/deductions–net

(8

)

—

—

(2

)

(10

)

Income before provision for taxes on income

747

37

—

6

790

Provision for taxes on income

148

8

—

—

156

Net income attributable to Zoetis

599

29

—

6

634

Earnings per common share attributable to Zoetis–diluted

1.31

0.06

—

0.01

1.38

(a) The condensed consolidated statements of income present the three months ended March 31, 2025 and 2024. Subsidiaries operating outside the United States are included for the three months ended February 28, 2025 and February 29, 2024.

(b) Non-GAAP adjusted net income and its components and non-GAAP adjusted diluted EPS are not, and should not be viewed as, substitutes for U.S. GAAP net income and its components and diluted EPS. Despite the importance of these measures to management in goal setting and performance measurement, non-GAAP adjusted net income and its components and non-GAAP adjusted diluted EPS are non-GAAP financial measures that have no standardized meaning prescribed by U.S. GAAP and, therefore, have limits in their usefulness to investors. Because of the non-standardized definitions, non-GAAP adjusted net income and its components and non-GAAP adjusted diluted EPS (unlike U.S. GAAP net income and its components and diluted EPS) may not be comparable to the calculation of similar measures of other companies. Non-GAAP adjusted net income and its components, and non-GAAP adjusted diluted EPS are presented solely to permit investors to more fully understand how management assesses performance.

See Notes to Reconciliation of GAAP Reported to Non-GAAP Adjusted Information for note (1).

ZOETIS INC.

NOTES TO RECONCILIATION OF GAAP REPORTED TO NON-GAAP ADJUSTED INFORMATION

CERTAIN LINE ITEMS

(UNAUDITED)

(millions of dollars)

(1) Certain significant items include the following:

Three Months Ended

March 31,

2025

2024

Other restructuring charges and cost-reduction/productivity initiatives^(a)

$

—

$

4

Other

6

2

Total certain significant items—pre-tax

6

6

Income taxes^(b)

—

—

Total certain significant items—net of tax

$

6

$

6

(a) For the three months ended March 31, 2024, primarily consisted of employee termination costs related to organizational structure refinements, partially offset by a reversal of certain employee termination costs as a result of a change in strategy from our 2015 operational efficiency initiative, included in Restructuring charges and certain acquisition and divestiture-related costs.

(b) Included in Provision for taxes on income. Income taxes include the tax effect of the associated pre-tax amounts, calculated by determining the jurisdictional location of the pre-tax amounts and applying that jurisdiction’s applicable tax rate.

ZOETIS INC.

ADJUSTED SELECTED COSTS, EXPENSES AND INCOME^(a)

(UNAUDITED)

(millions of dollars)

Three Months Ended

March 31,

% Change

2025

2024

Total

Foreign Exchange

Operational^(b)

Divestitures

Organic Operational^(c)

Adjusted cost of sales

$

620

$

642

(3

)%

(10

)%

7

%

as a percent of revenue

27.9

%

29.3

%

NA

NA

NA

Adjusted SG&A expenses

554

544

2

%

(2

)%

4

%

Adjusted R&D expenses

157

161

(2

)%

—

%

(2

)%

Adjusted net income

662

634

4

%

2

%

2

%

(4

)%

6

%

(a) Adjusted cost of sales, adjusted selling, general, and administrative (SG&A) expenses, adjusted research and development (R&D) expenses, and adjusted net income (non-GAAP financial measures) are defined as the corresponding reported U.S. GAAP income statement line items excluding purchase accounting adjustments, acquisition and divestiture-related costs and certain significant items. These adjusted income statement line item measures are not, and should not be viewed as, substitutes for the corresponding U.S. GAAP line items. The corresponding GAAP line items and reconciliations of reported to adjusted information are provided in Condensed Consolidated Statements of Income and Reconciliation of GAAP Reported to Non-GAAP Adjusted Information.

(b) Operational results (a non-GAAP financial measure) is defined as results excluding the impact of foreign exchange.

(c) Organic operational results (a non-GAAP financial measure) is defined as revenue excluding the impact of foreign exchange and certain acquisitions and divestitures.

ZOETIS INC.

2025 GUIDANCE

Selected Line Items

(millions of dollars, except per share amounts)

Full Year 2025

as of May 6, 2025

Full Year 2025

as of February 13, 2025

(Prior Guidance)

Revenue

$9,425 to $9,575

$9,225 to $9,375

Organic operational growth^(a)

6% to 8%

6% to 8%

Adjusted cost of sales as a percentage of revenue^(b)

Approximately 28.5%

Approximately 28.0%

Adjusted SG&A expenses^(b)

$2,340 to $2,390

$2,300 to $2,350

Adjusted R&D expenses^(b)

$690 to $700

$680 to $690

Adjusted interest expense and other (income)/deductions-net^(b)

Approximately $180

Approximately $200

Effective tax rate on adjusted income^(b)

Approximately 21%

Approximately 21%

Adjusted diluted EPS^(b)

$6.20 to $6.30

$6.00 to $6.10

Adjusted net income^(b)

$2,775 to $2,825

$2,700 to $2,750

Organic operational growth^(a)(c)

5% to 7%

6% to 8%

Certain significant items and acquisition and divestiture-related costs^(d)

Approximately $45

Approximately $30

The guidance as of May 6, 2025 reflects foreign exchange rates as of late April 2025. The prior guidance as of February 13, 2025 reflects foreign exchange rates as of late January 2025.

Reconciliations of 2025 reported guidance to 2025 adjusted guidance follows:

(millions of dollars, except per share amounts)
Reported

Certain significant items and acquisition and divestiture-related costs^(d)

Purchase accounting

Adjusted^(b)

Cost of sales as a percentage of revenue

~ 28.7%

~ (0.1%)

~ (0.1%)

~ 28.5%

SG&A expenses

$2,365 to $2,415

~ $(15)

~ $(10)

$2,340 to $2,390

R&D expenses

$692 to $702

~ $(2)

$690 to $700

Interest expense and other (income)/deductions-net

~ $180

~ $180

Effective tax rate

~ 21%

~ 21%

Diluted EPS

$5.85 to $5.95

~ $0.10

~ $0.25

$6.20 to $6.30

Net income attributable to Zoetis

$2,630 to $2,680

~ $45

~ $100

$2,775 to $2,825

(a) Organic operational results (a non-GAAP financial measure) excludes the impact of foreign exchange and certain acquisitions and divestitures.

(b) Adjusted net income and its components and adjusted diluted EPS are defined as reported U.S. GAAP net income and its components and reported diluted EPS excluding purchase accounting adjustments, acquisition and divestiture-related costs and certain significant items. Adjusted cost of sales, adjusted SG&A expenses, adjusted R&D expenses, and adjusted interest expense and other (income)/deductions-net are income statement line items prepared on the same basis, and, therefore, components of the overall adjusted income measure. Despite the importance of these measures to management in goal setting and performance measurement, adjusted net income and its components and adjusted diluted EPS are non-GAAP financial measures that have no standardized meaning prescribed by U.S. GAAP and, therefore, have limits in their usefulness to investors. Because of the non-standardized definitions, adjusted net income and its components and adjusted diluted EPS (unlike U.S. GAAP net income and its components and diluted EPS) may not be comparable to the calculation of similar measures of other companies. Adjusted net income and its components and adjusted diluted EPS are presented solely to permit investors to more fully understand how management assesses performance. Adjusted net income and its components and adjusted diluted EPS are not, and should not be viewed as, substitutes for U.S. GAAP net income and its components and diluted EPS.

(c) We do not provide a reconciliation of forward-looking non-GAAP adjusted net income operational results to the most directly comparable U.S. GAAP reported financial measure because we are unable to calculate with reasonable certainty the foreign exchange impact of unusual gains and losses, acquisition and divestiture-related expenses, potential future asset impairments and other certain significant items, without unreasonable effort. The foreign exchange impacts of these items are uncertain, depend on various factors, and could have a material impact on U.S. GAAP reported results for the guidance period.

(d) Primarily includes certain nonrecurring costs related to acquisitions, divestitures and other charges.

ZOETIS INC.

CONSOLIDATED REVENUE BY SEGMENT^(a) AND SPECIES

(UNAUDITED)

(millions of dollars)

Three Months Ended

March 31,

% Change

2025

2024

Total

Foreign Exchange

Operational^(b)

Divestitures

Organic Operational^(c)

Revenue:

Companion Animal

$

1,546

$

1,450

7

%

(2

)%

9

%

—

%

9

%

Livestock

645

720

(10

)%

(5

)%

(5

)%

(12

)%

7

%

Contract Manufacturing & Human Health

29

20

45

%

(6

)%

51

%

—

%

51

%

Total Revenue

$

2,220

$

2,190

1

%

(4

)%

5

%

(4

)%

9

%

U.S.:

Companion Animal

$

973

$

898

8

%

—

%

8

%

—

%

8

%

Livestock

210

265

(21

)%

—

%

(21

)%

(19

)%

(2

)%

Total U.S. Revenue

$

1,183

$

1,163

2

%

—

%

2

%

(4

)%

6

%

International:

Companion Animal

$

573

$

552

4

%

(6

)%

10

%

—

%

10

%

Livestock

435

455

(4

)%

(8

)%

4

%

(8

)%

12

%

Total International Revenue

$

1,008

$

1,007

—

%

(7

)%

7

%

(4

)%

11

%

Companion Animal:

Dogs and Cats

$

1,481

$

1,384

7

%

(2

)%

9

%

Horses

65

66

(2

)%

(4

)%

2

%

Total Companion Animal Revenue

$

1,546

$

1,450

7

%

(2

)%

9

%

Livestock:

Cattle

$

358

$

391

(8

)%

(5

)%

(3

)%

Swine

111

127

(13

)%

(6

)%

(7

)%

Poultry

106

139

(24

)%

(4

)%

(20

)%

Fish

53

45

18

%

(3

)%

21

%

Sheep and other

17

18

(6

)%

(6

)%

—

%

Total Livestock Revenue

$

645

$

720

(10

)%

(5

)%

(5

)%

(a) For a description of each segment, see Zoetis’ most recent Annual Report on Form 10-K.

(b) Operational revenue results (a non-GAAP financial measure) is defined as revenue results excluding the impact of foreign exchange.

(c) Organic operational results (a non-GAAP financial measure) is defined as revenue excluding the impact of foreign exchange and certain acquisitions and divestitures.

ZOETIS INC.

CONSOLIDATED REVENUE BY KEY INTERNATIONAL MARKETS

(UNAUDITED)

(millions of dollars)

Three Months Ended

March 31,

% Change

2025

2024

Total

Foreign Exchange

Operational^(a)

Total International

$

1,008

$

1,007

—

%

(7

)%

7

%

Australia

75

73

3

%

(5

)%

8

%

Brazil

88

101

(13

)%

(19

)%

6

%

Canada

67

61

10

%

(7

)%

17

%

Chile

34

31

10

%

(1

)%

11

%

China

60

76

(21

)%

(1

)%

(20

)%

France

40

41

(2

)%

(4

)%

2

%

Germany

51

51

—

%

(4

)%

4

%

Italy

29

28

4

%

(5

)%

9

%

Japan

36

37

(3

)%

(5

)%

2

%

Mexico

37

44

(16

)%

(15

)%

(1

)%

Spain

33

32

3

%

(4

)%

7

%

United Kingdom

77

77

—

%

(1

)%

1

%

Other developed markets

133

127

5

%

(6

)%

11

%

Other emerging markets

248

228

9

%

(8

)%

17

%

(a) Operational revenue results (a non-GAAP financial measure) is defined as revenue results excluding the impact of foreign exchange.

Note: operational revenue results are not reflective of organic operational results.

ZOETIS INC.

SEGMENT^(a) EARNINGS

(UNAUDITED)

(millions of dollars)

Three Months Ended

March 31,

% Change

2025

2024

Total

Foreign Exchange

Operational^(b)

U.S.:

Revenue

$

1,183

$

1,163

2

%

—

%

2

%

Cost of Sales

199

217

(8

)%

—

%

(8

)%

Gross Profit

984

946

4

%

—

%

4

%

Gross Margin

83.2

%

81.3

%

Operating Expenses

205

190

8

%

—

%

8

%

Other (income)/deductions-net

—

—

—

%

—

%

—

%

U.S. Earnings

$

779

$

756

3

%

—

%

3

%

International:

Revenue

$

1,008

$

1,007

—

%

(7

)%

7

%

Cost of Sales

302

313

(4

)%

(14

)%

10

%

Gross Profit

706

694

2

%

(4

)%

6

%

Gross Margin

70.0

%

68.9

%

Operating Expenses

154

159

(3

)%

(7

)%

4

%

Other (income)/deductions-net

1

—

*

*

*

International Earnings

$

551

$

535

3

%

(4

)%

7

%

Total Reportable Segments

$

1,330

$

1,291

3

%

(2

)%

5

%

Other business activities^(c)

(129

)

(132

)

(2

)%

Reconciling Items:

Corporate^(d)

(271

)

(288

)

(6

)%

Purchase accounting adjustments^(e)

(32

)

(37

)

(14

)%

Certain significant items^(f)

(6

)

(6

)

—

%

Other unallocated^(g)

(82

)

(81

)

1

%

Total Earnings^(h)

$

810

$

747

8

%

(a) For a description of each segment, see Zoetis’ most recent Annual Report on Form 10-K.

(b) Operational results (a non-GAAP financial measure) is defined as results excluding the impact of foreign exchange.

(c) Other business activities includes the research and development costs managed by our research and development organization, as well as our contract manufacturing business and human health business.

(d) Corporate includes, among other things, certain costs associated with information technology, administration expenses, interest income and expense, certain compensation costs and other costs not charged to our operating segments.

(e) Purchase accounting adjustments include certain charges related to the amortization of fair value adjustments to inventory, intangible assets and property, plant and equipment not charged to our operating segments.

(f) Certain significant items includes substantive, unusual items that, either as a result of their nature or size, would not be expected to occur as part of our normal business on a regular basis. Such items primarily include certain asset impairment charges, restructuring charges and implementation costs associated with cost-reduction/productivity initiatives that are not associated with an acquisition, as well as a loss on assets held for sale and the impact of divestiture gains and losses.

(g) Includes overhead expenses associated with our global manufacturing and supply operations not directly attributable to an operating segment, as well as certain procurement costs.

(h) Defined as income before provision for taxes on income.

* Calculation not meaningful.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250505476469/en/

Media:

Jennifer Albano

1-862-399-0810 (o)

[email protected]

Laura Panza

1-973-975-5176 (o)

[email protected]

Investor:

Steve Frank

1-973-822-7141 (o)

[email protected]

Nick Soonthornchai

1-973-443-2792 (o)

[email protected]

KEYWORDS: United States North America New Jersey

INDUSTRY KEYWORDS: Science Biotechnology Research Pharmaceutical Health FDA Medical Devices Clinical Trials

MEDIA:

Logo

Posted on May 6, 2025 7:17 am
Sharps Technology Receives ~$100K Initial Purchase Order from Hungarian Vaccine Provider for SecureGard™ Syringes

Sharps also received an initial qualification purchase order for DisGard™ single-use Sharps Recovery System

Company transitions to revenue producing with second purchase order, bringing total recent orders to approximately $500,000 for the quarter

NEW YORK, May 06, 2025 (GLOBE NEWSWIRE) — Sharps Technology, Inc. (NASDAQ: “STSS” and “STSSW”) (“Sharps”), an innovative medical device and pharmaceutical packaging company offering patented, best-in-class smart-safety syringe products to the healthcare industry, announces the receipt of a $100,000 purchase order from a Hungarian vaccine provider. This order supports the recently announced $400,000 SoloGard™ order, which is part of a broader $50 million agreement that was previously announced with a U.S. company and represents the first SecureGard™ order from this Hungary-based company.

“I am pleased to announce our second significant purchase order to date, bringing our total orders received for Q2 to approximately $500,000,” stated Robert Hayes, Chief Executive Officer of Sharps Technology. “These latest orders mark the first for our SecureGard and Disgard™ product lines, and we are excited to begin what we anticipate will be a long-term relationship with these customers. With this milestone, Sharps has officially transitioned into a commercial-stage company, which is a pivotal moment in our growth trajectory.”

In addition to the recent order for SecureGard, Sharps also received an initial qualification order for the DisGard Sharps Recovery System – a compact, single-use surgical sharps container designed to support safe, point-of-use disposal in operating rooms and outpatient procedures. The system plays a vital role in surgical inventory recovery by securing small sharps immediately after use, helping healthcare providers reduce loss of surgical instruments and mitigate injury risks.

Mr. Hayes concluded: “SecureGard, SoloGard, and DisGard are all manufactured at our state-of-the-art facility in Hungary, where we currently maintain inventory levels to meet ongoing and future demand. We are well-positioned to execute on our expanding pipeline of purchase agreements and remain focused on scaling production and fulfillment. We look forward to keeping our shareholders informed as we continue building momentum and delivering on our strategic vision.”

About SecureGard^® Retractable Safety Syringe:

The SecureGard Retractable Safety Syringe is a single-use, sterile, disposable hypodermic syringe with a needle attached which is intended for dispensing/administering fluids in medical practice. The key safety feature, where the clinician retracts the hypodermic needle by manually locking the plunger onto the needle hub, withdrawing the plunger, pulling the needle into the barrel and breaking the plunger, virtually eliminates the accidental clinical reuse of the syringe and accidental needle stick injuries.

Advantages of SecureGard Retractable Needles:

Low dead space (LDS) – reduce drug wastage

No change in technique, requires minimal training

Manual retraction

Low-cost solution

Latex free

Breakaway plunger

Available in 1ml, 3ml and 5ml capacity

Watch a video on SecureGard:
HERE

Visit the SecureGard website:
HERE

About Sharps Technology:

Sharps Technology is an innovative medical device and pharmaceutical packaging company offering patented, best-in-class smart-safety syringe products to the healthcare industry. The Company’s product lines focus on providing ultra-low waste capabilities, that incorporate syringe technologies that use both passive and active safety features. Sharps also offers products that are designed with specialized copolymer technology to support the prefillable syringe market segment. The Company has a manufacturing facility in Hungary. For additional information, please visit www.sharpstechnology.com.

FORWARD-LOOKING STATEMENTS:

This press release contains “forward-looking statements”. Forward-looking statements reflect our current view about future events. When used in this press release, the words “anticipate,” “believe,” “estimate,” “expect,” “future,” “intend,” “plan,” “poised” or the negative of these terms and similar expressions, as they relate to us or our management, identify forward-looking statements. Such statements, include, but are not limited to, statements contained in this press release relating to our business strategy, our future operating results and liquidity, and capital resources outlook. Forward-looking statements are based on our current expectations and assumptions regarding our business, the economy, and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks, and changes in circumstances that are difficult to predict. Our actual results may differ materially from those contemplated by the forward-looking statements. They are neither statements of historical fact nor guarantees of assurance of future performance. We caution you therefore against relying on any of these forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements include, without limitation, our ability to raise capital to fund continuing operations; our ability to protect our intellectual property rights; the impact of any infringement actions or other litigation brought against us; competition from other providers and products; our ability to develop and commercialize products and services; changes in government regulation; our ability to complete capital raising transactions; and other factors relating to our industry, our operations and results of operations. Actual results may differ significantly from those anticipated, believed, estimated, expected, intended, or planned. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We cannot guarantee future results, levels of activity, performance, or achievements. The Company assumes no obligation to update any forward-looking statements in order to reflect any event or circumstance that may arise after the date of this release.

Investor Contact:

Holdsworth Partners

Adam Holdsworth
Phone: 917-497-9287
Email: [email protected]

Posted on May 6, 2025 7:16 am
Orthofix Reports First Quarter 2025 Financial Results

Orthofix Reports First Quarter 2025 Financial Results

LEWISVILLE, Texas–(BUSINESS WIRE)–
Orthofix Medical Inc. (NASDAQ:OFIX), a leading global medical technology company, today reported its financial results for the first quarter ended March 31, 2025, updated its full-year 2025 net sales guidance, and reaffirmed its full-year 2025 non-GAAP adjusted EBITDA and positive free cash flow guidance. All pro forma measures contained within this release exclude the impact of the Company’s decision to discontinue its M6-C™ and M6-L™ artificial disc product lines.

Highlights

First quarter 2025 net sales of $193.6 million, including sales from its M6 artificial cervical and lumbar discs, and pro forma net sales of $189.2 million, excluding sales from its M6 discs, representing an increase of 3% on a reported basis and 4% on a pro forma constant currency basis compared to first quarter 2024

U.S. Spine Fixation¹ net sales growth of 4% compared to first quarter 2024

Bone Growth Therapies (“BGT”) net sales of $55.1 million, representing growth of 5%, with BGT Fracture net sales growth of 6% compared to first quarter 2024

Global Orthopedics net sales of $29.8 million, achieving constant currency growth of 11% and U.S. Orthopedics net sales growth of 10% compared to first quarter 2024

Received 510(k) clearance and CE Mark for TrueLok™ Elevate Transverse Bone Transport (“TBT”) System – the first FDA-cleared device for TBT to correct non-unions and bony or soft tissue deformities or defects

First quarter 2025 net loss of $(53.1) million on a reported basis; Non-GAAP pro forma adjusted EBITDA of $11.4 million, with pro forma adjusted EBITDA margin expanding approximately 200 basis points compared to reported non-GAAP adjusted EBITDA for the first quarter 2024

First quarter 2025 net sales were $193.6 million, including sales from M6 artificial cervical and lumbar discs, and pro forma net sales of $189.2 million, excluding sales from its M6 discs, representing an increase of 2.7% on a reported basis and 4.3% on a pro forma constant currency basis compared to first quarter 2024. Net loss was $(53.1) million, or $(1.35) per share, on a reported basis. Non-GAAP pro forma adjusted EBITDA was $11.4 million for the first quarter, an increase of $3.8 million compared to reported non-GAAP adjusted EBITDA for the first quarter of 2024, representing 49.1% growth over prior year.

“We are continuing to execute the priorities that we outlined in our three-year plan to transform our business and deliver on our commitment to drive disciplined, profitable growth,” said Massimo Calafiore, President and Chief Executive Officer. “While we made excellent progress in adjusted EBITDA in the first quarter, our ongoing efforts to optimize our commercial channel resulted in some incremental softness in Biologics and Spine Fixation. Once these optimization efforts are completed, we expect growth to return to historical levels.”

Mr. Calafiore continued, “We also are taking additional proactive steps to optimize our spine commercial channel and accelerate targeted distributor transitions in a few U.S. territories in order to maximize our growth opportunities and more closely align with our strategic focus. This transition won’t be completed until later this year and will require some time for the full effects to be realized, but it is expected to result in a stronger, more scalable commercial organization as we shift into our next phase of growth. We have adjusted our guidance accordingly to reflect the short-term impact from this targeted transition, which we believe will set us up for success and generate significant future returns.”

Mr. Calafiore concluded, “Looking ahead, we are focused on three strategic priorities to drive market share gains in our spine business and build a fast-growing orthopedics business specifically focused on limb reconstruction. First, further sharpening our commercial execution to drive deeper market penetration through our comprehensive portfolio offerings, including the adoption of our 7D FLASH™ Navigation System; second, implementing projects to improve our gross margin; and finally, focusing on disciplined capital allocation, adjusted EBITDA expansion, and positive free cash flow generation, ensuring we are well-positioned to create long-term value for our shareholders in 2025 and beyond.”

¹ Spine Fixation is comprised of the Company’s Spinal Implants product category, excluding motion preservation product offerings

Financial Results Overview

First Quarter 2025 Net Sales and Financial Results

The following table provides net sales by major product category and by reporting segment on a pro forma basis, removing the effects of the Company’s discontinued M6 product lines:

Three Months Ended March 31,

(Unaudited, U.S. Dollars, in millions)

2025

2024

Change

Constant

Currency

Change

Bone Growth Therapies

$

55.1

$

52.5

4.9

%

4.9

%

Spinal Implants, Biologics and Enabling Technologies*

104.3

102.3

2.0

%

2.0

%

Global Spine*

159.4

154.8

3.0

%

3.0

%

Global Orthopedics

29.8

27.3

9.1

%

11.5

%

Pro forma net sales*

189.2

182.1

3.9

%

4.3

%

Impact from discontinuation of M6 product lines

4.4

6.5

(31.9

%)

(31.5

%)

Reported net sales

$

193.6

$

188.6

2.7

%

3.0

%

* Results above for each of Spinal Implants, Biologics, and Enabling Technologies; Global Spine; and Pro forma net sales exclude the impact from discontinuation of the M6 product lines. Since Pro forma net sales represent a non-GAAP measure, see the reconciliation above of the Company’s Pro forma net sales to its reported figures under U.S. GAAP. The Company’s reported figures under U.S. GAAP represent each of the pro forma line items discussed above plus the impact from discontinuation of the M6 product lines.

Gross margins were 62.8% for the quarter and were 70.3% on a non-GAAP pro forma adjusted basis.

Net loss was $(53.1) million, or $(1.35) per share, on a reported basis, compared to net loss of $(36.0) million, or $(0.95) per share in the prior year period. Non-GAAP pro forma adjusted EBITDA was $11.4 million, or 6.0% of pro forma net sales, compared to reported non-GAAP adjusted EBITDA of $7.7 million, or 4.1% of reported net sales, in the prior year period.

Liquidity

Cash, cash equivalents, and restricted cash on March 31, 2025 totaled $60.5 million compared to $85.7 million on December 31, 2024. This decrease was primarily due to the payment of the 2024 annual bonuses, commissions for the fourth quarter of 2024, and cash severance payments, among other items. Excluding these items, uses of cash were in line with normal business operations.

Business Outlook

The Company is updating its full-year net sales guidance and reaffirming its full-year 2025 adjusted EBITDA and free cash flow guidance as follows:

Net sales now expected to range between $808 million to $816 million, excluding sales from the discontinued M6 product lines, representing implied constant currency growth of 5.0% year-over-year at the midpoint of the range. This compares to the previous full-year net sales guidance of $818 million to $826 million. The revised guidance range assumes a $5 million negative impact from U.S. funded non-governmental organization (NGO) business as compared to the full-year 2024. It is also based on current foreign currency exchange rates and does not take into account any additional potential exchange rate changes that may occur this year.

No change to non-GAAP adjusted EBITDA, which is expected to be $82 million to $86 million. This range includes the anticipated impact from the discontinuation of the M6 product lines that was previously announced in February 2025.

No change to free cash flow, which is expected to be positive for full-year 2025, excluding the impact of restructuring charges related to the discontinuation of the M6 product lines.

An investor presentation for the Company’s first quarter 2025 financial results is available in the “Events & Presentations” section of the Orthofix investor relations website at ir.orthofix.com.

Conference Call

Orthofix will host a conference call today at 8:30 AM Eastern time to discuss the Company’s financial results for the quarter ended March 31, 2025. Interested parties may access the conference call by dialing (888) 596-4144 in the U.S., and (646) 968-2525 in all other locations, and referencing the conference ID 7524113. A webcast and replay of the conference call may be accessed in the “Events & Presentations” section of the Orthofix investor relations website at ir.orthofix.com.

Internet Posting of Information

Orthofix routinely posts information that may be important to investors in the “Investor Relations” section of its website at www.orthofix.com. The Company encourages investors and potential investors to consult the Orthofix website regularly for important information about Orthofix.

About Orthofix

Orthofix is a global medical technology company headquartered in Lewisville, Texas. By providing medical technologies that heal musculoskeletal pathologies, we deliver exceptional experiences and life-changing solutions to patients around the world. Orthofix offers a comprehensive portfolio of spinal hardware, bone growth therapies, specialized orthopedic solutions, biologics and enabling technologies, including the 7D FLASH™ navigation system. To learn more, visit Orthofix.com and follow on LinkedIn.

Forward-Looking Statements

This communication contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended, relating to our business and financial outlook, which are based on our current beliefs, assumptions, intentions, plans, expectations, estimates, forecasts and projections. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “projects,” “intends,” “predicts,” “potential,” or “continue” or other comparable terminology. Forward-looking statements in this communication include the Company’s expectations regarding net sales, adjusted EBITDA, and free cash flow for the year ended December 31, 2025. Forward-looking statements are not guarantees of our future performance, are based on our current expectations and assumptions regarding our business, the economy and other future conditions, and are subject to risks, uncertainties and changes in circumstances that are difficult to predict, including the risks described in Part I, Item 1A under the heading Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2024, and in Part II, Item 1A under the heading Risk Factors in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2025. Factors that could cause future results to differ from those expressed by forward-looking statements include, but are not limited to, (i) our ability to maintain operations to support our customers and patients in the near-term and to capitalize on future growth opportunities, (ii) risks associated with acceptance of surgical products and procedures by surgeons and hospitals, (iii) development and acceptance of new products or product enhancements, (iv) clinical and statistical verification of the benefits achieved via the use of our products, (v) our ability to adequately manage inventory, (vi) our ability to successfully optimize our commercial channels, (vii) our success in defending legal proceedings brought against us, and (viii) the other risks and uncertainties more fully described in our periodic filings with the Securities and Exchange Commission (the “SEC”). As a result of these various risks, our actual outcomes and results may differ materially from those expressed in these forward-looking statements.

Further, any forward-looking statement speaks only as of the date hereof, unless it is specifically otherwise stated to be made as of a different date. We undertake no obligation to update, and expressly disclaim any duty to update, our forward-looking statements, whether as a result of circumstances or events that arise after the date hereof, new information, or otherwise, except as required by law.

The Company is unable to provide expectations of GAAP net income (loss), the closest comparable GAAP measures to adjusted EBITDA (which is a non-GAAP measure), on a forward-looking basis because the Company is unable to predict, without unreasonable efforts, the ultimate outcome of matters (including acquisition-related expenses, accounting fair value adjustments, and other such items) that will determine the quantitative amount of the items excluded in calculating adjusted EBITDA, which items are further described in the reconciliation tables and related descriptions below. These items are uncertain, depend on various factors, and could be material to the Company’s results computed in accordance with GAAP.

ORTHOFIX MEDICAL INC.

Condensed Consolidated Statements of Operations

Three Months Ended

March 31,

(Unaudited, U.S. Dollars, in thousands, except share and per share data)

2025

2024

Net sales

$

193,646

$

188,608

Cost of sales

72,027

61,366

Gross profit

121,619

127,242

Sales, general, and administrative

132,981

131,691

Research and development

19,766

19,492

Acquisition-related amortization, impairment, and remeasurement

17,745

5,396

Operating loss

(48,873

)

(29,337

)

Interest expense, net

(4,506

)

(4,558

)

Other income (expense), net

1,246

(1,274

)

Loss before income taxes

(52,133

)

(35,169

)

Income tax expense

(961

)

(851

)

Net loss

$

(53,094

)

$

(36,020

)

Net loss per common share:

Basic

$

(1.35

)

$

(0.95

)

Diluted

(1.35

)

(0.95

)

Weighted average number of common shares (in millions):

Basic

39.2

37.7

Diluted

39.2

37.7

ORTHOFIX MEDICAL INC.

Condensed Consolidated Balance Sheets

(U.S. Dollars, in thousands, except par value data)

March 31,

2025

December 31,

2024

(Unaudited)

Assets

Current assets

Cash and cash equivalents

$

57,953

$

83,238

Restricted Cash

2,500

2,500

Accounts receivable, net of allowances of $8,602 and $7,418, respectively

131,865

134,713

Inventories

174,480

189,452

Prepaid expenses and other current assets

23,512

23,382

Total current assets

390,310

433,285

Property, plant, and equipment, net

130,693

139,804

Intangible assets, net

81,213

98,803

Goodwill

194,934

194,934

Other long-term assets

25,994

26,468

Total assets

$

823,144

$

893,294

Liabilities and shareholders’ equity

Current liabilities

Accounts payable

$

45,176

$

48,803

Current portion of finance lease liability

767

755

Other current liabilities

98,173

119,070

Total current liabilities

144,116

168,628

Long-term debt

156,885

157,015

Long-term portion of finance lease liability

17,636

17,835

Other long-term liabilities

46,213

46,692

Total liabilities

364,850

390,170

Contingencies

Shareholders’ equity

Common shares $0.10 par value; 100,000 shares authorized;

39,096 and 38,486 issued and outstanding as of March 31,

2025, and December 31, 2024, respectively

3,910

3,849

Additional paid-in capital

786,175

779,718

Accumulated deficit

(329,235

)

(276,141

)

Accumulated other comprehensive loss

(2,556

)

(4,302

)

Total shareholders’ equity

458,294

503,124

Total liabilities and shareholders’ equity

$

823,144

$

893,294

ORTHOFIX MEDICAL INC.

Non-GAAP Financial Measures

The following tables present reconciliations of various financial measures calculated in accordance with U.S. generally accepted accounting principles (“GAAP”), to various non-GAAP financial measures that exclude (or in the case of free cash flow, include) items specified in the tables. The GAAP measures shown in the tables below represent the most comparable GAAP measure to the applicable non-GAAP measure(s) shown in the table. For further information regarding the nature of these exclusions, why the Company believes that these non-GAAP financial measures provide useful information to investors, the specific manner in which management uses these measures, and some of the limitations associated with the use of these measures, please refer to the Company’s Current Report on Form 8-K regarding this press release filed today with the SEC available on the SEC’s website at www.sec.gov and on the “Investors” page of the Company’s website at www.orthofix.com.

The Company’s non-GAAP financial measures for both the three months ended March 31, 2025 and 2024, have been adjusted to eliminate the financial effects of the Company’s decision to discontinue its M6 product lines. Accordingly, previously reported figures for 2024 have been recast to reflect the financial impact of this decision.

Adjusted Gross Profit and Adjusted Gross Margin

Three Months Ended March 31,

(Unaudited, U.S. Dollars, in thousands)

2025

2024

Gross profit

$

121,619

$

127,242

Share-based compensation expense

462

537

SeaSpine merger-related costs

600

1,303

Restructuring costs and impairments related to M6 product lines

10,919

—

Strategic investments

13

65

Acquisition-related fair value adjustments

—

3,047

Amortization/depreciation of acquired long-lived assets

313

318

Adjusted gross profit

$

133,926

$

132,512

Adjusted gross margin as a percentage of reported net sales

69.2

%

70.3

%

Adjusted gross profit attributable to M6 product lines

(906

)

(2,895

)

Pro forma adjusted gross profit

$

133,020

$

129,617

Pro forma adjusted gross margin as a percentage of pro forma net sales

70.3

%

71.2

%

Adjusted EBITDA

Three Months Ended March 31,

(Unaudited, U.S. Dollars, in thousands)

2025

2024

Net loss

$

(53,094

)

$

(36,020

)

Income tax expense

961

851

Interest expense, net

4,506

4,558

Depreciation and amortization

34,431

14,862

Share-based compensation expense

6,469

8,800

Foreign exchange impact

(1,044

)

1,588

SeaSpine merger-related costs

1,130

4,479

Restructuring costs and impairments related to M6 product lines

9,880

—

Strategic investments

3,514

120

Acquisition-related fair value adjustments

(610

)

4,217

Interest and loss on investments

—

(260

)

Litigation and investigation costs

3,042

2,260

Succession charges

—

2,210

Adjusted EBITDA

$

9,185

$

7,665

Adjusted EBITDA as a percentage of reported net sales

4.7

%

4.1

%

Operating losses attributable to M6 product lines

2,246

1,854

Pro forma adjusted EBITDA

$

11,431

$

9,519

Adjusted EBITDA as a percentage of pro forma net sales

6.0

%

5.2

%

Adjusted Net Income

Three Months Ended March 31,

(Unaudited, U.S. Dollars, in thousands)

2025

2024

Net loss

$

(53,094

)

$

(36,020

)

Share-based compensation expense

6,469

8,800

Foreign exchange impact

(1,044

)

1,588

SeaSpine merger-related costs

1,474

4,848

Restructuring costs and impairments related to M6 product lines

30,204

—

Strategic investments

3,543

126

Acquisition-related fair value adjustments

(610

)

4,217

Amortization/depreciation of acquired long-lived assets

4,632

4,792

Litigation and investigation costs

3,042

2,260

Succession charges

—

2,210

Interest and loss on investments

—

(260

)

Long-term income tax rate adjustment

2,200

2,696

Adjusted net loss

$

(3,184

)

$

(4,743

)

Operating losses attributable to M6 product lines

2,688

2,400

Long-term income tax rate adjustment for M6 product lines

(753

)

(672

)

Pro forma adjusted net loss

$

(1,249

)

$

(3,015

)

Cash Flow and Free Cash Flow

Three Months Ended March 31,

(Unaudited, U.S. Dollars, in thousands)

2025

2024

Net cash from operating activities

$

(18,391

)

$

(18,595

)

Net cash from investing activities

(6,736

)

(10,867

)

Net cash from financing activities

(651

)

21,453

Effect of exchange rate changes on cash

493

(284

)

Net change in cash and cash equivalents

$

(25,285

)

$

(8,293

)

Three Months Ended March 31,

(Unaudited, U.S. Dollars, in thousands)

2025

2024

Net cash from operating activities

$

(18,391

)

$

(18,595

)

Capital expenditures

(6,736

)

(10,817

)

Free cash flow

$

(25,127

)

$

(29,412

)

Reconciliation of Non-GAAP Financial Measures to Reported Operating Expenses

Three Months Ended March 31,

(Unaudited, U.S. Dollars, in thousands)

2025

2024

Sales, general, and administrative

$

132,981

$

131,691

Reconciling items impacting sales, general, and administrative:

Restructuring costs and impairments related to M6 product lines

(3,336

)

—

Strategic investments

(2,304

)

(3,431

)

Amortization/depreciation of acquired long-lived assets

(60

)

(248

)

Litigation and investigation costs

(3,042

)

(2,260

)

Succession charges

—

(2,210

)

Sales, general, and administrative expense, as adjusted

$

124,239

$

123,542

As a percentage of reported net sales

64.2

%

65.5

%

Sales, general, and administrative expense attributable to M6 product lines

(2,388

)

(4,155

)

Pro forma sales, general, and administrative expense, as adjusted

$

121,851

$

119,387

As a percentage of pro forma net sales

64.4

%

65.6

%

Three Months Ended March 31,

(Unaudited, U.S. Dollars, in thousands)

2025

2024

Research and development expense, as reported

$

19,766

$

19,492

Reconciling items impacting research and development:

Restructuring costs and impairments related to M6 product lines

(1,852

)

—

Strategic investments

(2,099

)

(237

)

Research and development expense, as adjusted

$

15,815

$

19,255

As a percentage of reported net sales

8.2

%

10.2

%

Research and development expense attributable to M6 product lines

(1,192

)

(2,236

)

Pro forma research and development expense, as adjusted

$

14,623

$

17,019

As a percentage of pro forma net sales

7.7

%

9.3

%

Reconciliations of Non-GAAP Financial Measures to Reported Non-Operating (Income) Expense

Three Months Ended March 31,

(Unaudited, U.S. Dollars, in thousands)

2025

2024

Non-operating expense

$

3,260

$

5,832

Reconciling items impacting non-operating expense:

Foreign exchange impact

1,044

(1,588

)

Interest and loss on investments

—

283

Non-operating expense, as adjusted

$

4,304

$

4,527

As a percentage of reported net sales

2.2

%

2.4

%

Losses attributable to M6 product lines

(15

)

(47

)

Pro forma non-operating expense, as adjusted

$

4,289

$

4,480

As a percentage of pro forma net sales

2.3

%

2.5

%

View source version on businesswire.com: https://www.businesswire.com/news/home/20250506900858/en/

Company Contact

Investors and Media

Julie Dewey, IRC

Chief Investor Relations & Communications Officer

[email protected]

209.613.6945

KEYWORDS: United States North America Texas

INDUSTRY KEYWORDS: Biotechnology Health Other Health Medical Devices

MEDIA:

Logo

Posted on May 6, 2025 7:14 am
Fractyl Health to Report First Quarter 2025 Financial Results and Provide Business Updates on May 13, 2025, and Will Participate in an Upcoming Investor Conference

BURLINGTON, Mass., May 06, 2025 (GLOBE NEWSWIRE) — Fractyl Health, Inc. (Nasdaq: GUTS) (the “Company”), a metabolic therapeutics company focused on pattern breaking approaches that treat root causes of obesity and type 2 diabetes (T2D), today announced it will report financial results for the first quarter 2025 and provide business updates on Tuesday, May 13, 2025, at 4:30 p.m. ET.

A live webcast of the conference call can be accessed in the “Events” section of Fractyl Health’s website at http://ir.fractyl.com. The webcast will be archived and available for replay following the live event.

The Company also announced that Harith Rajagopalan, M.D., Ph.D., Co-Founder and Chief Executive Officer of Fractyl Health, will present at the BofA Securities 2025 Health Care Conference on Wednesday, May 14, 2025, at 5:00 p.m. PT (8:00 p.m. ET).

A live webcast of the presentation can be accessed in the “Events” section of Fractyl Health’s website at https://ir.fractyl.com/. The webcast will be archived and available for replay following the live event. To register in advance for the presentation webcast, sign up here.

About Fractyl Health

Fractyl Health is a metabolic therapeutics company focused on pioneering new approaches to the treatment of metabolic diseases, including obesity and T2D. Despite advances in treatment over the last 50 years, obesity and T2D continue to be rapidly growing drivers of morbidity and mortality in the 21st century. Fractyl Health’s goal is to transform metabolic disease treatment from chronic symptomatic management to durable disease-modifying therapies that target the organ-level root causes of disease. Fractyl Health is based in Burlington, MA. For more information, visit www.fractyl.com.

Contacts

Media Contact

Jessica Cotrone, Head of Corporate Communications
[email protected], 978.760.5622

Investor Contact

Brian Luque, Head of Investor Relations and Corporate Development
[email protected], 951.206.1200

Posted on May 6, 2025 7:13 am
FIS Reports Strong First Quarter 2025 Results and Reiterates Full-Year Outlook

FIS Reports Strong First Quarter 2025 Results and Reiterates Full-Year Outlook

First quarter GAAP Diluted EPS of $0.15

Adjusted EPS of $1.21 increased 11% over the prior-year period

Revenue increased 3% on a GAAP basis and 4% on an adjusted basis to $2.5 billion

Repurchased $450 million of shares in the first quarter; reiterates goal to repurchase $1.2 billion of shares in 2025

Reiterates full-year 2025 outlook for Revenue, Adjusted EBITDA and Adjusted EPS¹

On April 17, 2025, the Company announced the sale of its remaining Worldpay stake and the strategic acquisition of Global Payments’ Issuer Solutions business. Transactions are expected to close simultaneously in the first half of 2026, subject to regulatory approvals and other customary closing conditions

JACKSONVILLE, Fla.–(BUSINESS WIRE)–
FIS^® (NYSE:FIS), a global leader in financial technology, today reported its first quarter 2025 results.

“We had a great start to the year, delivering another quarter of financial outperformance, giving us the confidence to reiterate our full-year outlook,” said FIS CEO and President Stephanie Ferris. “We are very excited about our recently announced strategic transactions that will allow us to fully monetize our Worldpay stake at an attractive valuation and strengthen our financial profile with the acquisition of the Issuer Solutions business. These strategic transactions will expand FIS’ payment product suite, enhancing our relationships with financial institutions and corporate clients.”

First Quarter 2025 Financial Results

On a GAAP basis, revenue increased 3% as compared to the prior-year period to approximately $2.5 billion. GAAP net earnings attributable to common stockholders from continuing operations were $77 million or $0.15 per diluted share.

On an adjusted basis, revenue increased 4% as compared to the prior-year period reflecting recurring revenue growth of 4%. Adjusted EBITDA was approximately $1.0 billion, and Adjusted EBITDA margin contracted by 142 basis points (bps) over the prior-year period to 37.8%, reflecting high license and termination fee revenue in the prior-year period. Adjusted net earnings from continuing operations were $643 million, and Adjusted EPS increased by 11% as compared to the prior-year period to $1.21 per diluted share.

($ millions, except per share data, unaudited)

Three Months Ended March 31,

%

Adjusted

Continuing Operations

2025

2024

Change

Growth

Banking Solutions Revenue

1,718

1,685

2%

2%

Capital Market Solutions Revenue

764

706

8%

9%

Operating Segment Total Revenue

$

2,482

$

2,391

4%

4%

Corporate and Other Revenue

50

77

(36)%

–

Consolidated FIS Revenue

$

2,532

$

2,468

3%

–

Adjusted EBITDA

$

958

$

969

(1)%

Adjusted EBITDA Margin

37.8

%

39.3

%

(142) bps

Net Earnings (Loss) (GAAP)

$

77

$

(1)

*

Diluted Earnings (Loss) Per Common Share (GAAP)

$

0.15

$

—

*

Adjusted Net Earnings

$

643

$

629

2%

Adjusted EPS

$

1.21

$

1.09

11%

^*Indicates comparison not meaningful

Segment Information

Banking Solutions:

First quarter revenue increased 2% on a GAAP basis and 2% on an adjusted basis as compared to the prior-year period to $1.7 billion, including recurring revenue growth of 3%. Adjusted EBITDA margin contracted by 379 basis points as compared to the prior-year period to 40.1%, reflecting high license and termination fee revenue in the prior-year period and the timing of expenses.

Capital Market Solutions:

First quarter revenue increased by 8% on a GAAP basis and 9% on an adjusted basis as compared to the prior-year period to $764 million, reflecting recurring revenue growth of 6% and non-recurring revenue growth of 47%. Adjusted EBITDA margin expanded by 90 basis points as compared to the prior-year period to 48.3%, reflecting an increase in higher-margin license revenue and operating leverage.

Corporateand Other:

First quarter revenue decreased by 36% as compared to the prior-year period to $50 million. Adjusted EBITDA loss was $99 million, including $116 million of corporate expenses.

Balance Sheet and Cash Flows

As of March 31, 2025, debt outstanding totaled $12.0 billion. First quarter net cash provided by operating activities was $457 million, and adjusted free cash flow was $368 million. In the first quarter, the Company returned $670 million of capital to shareholders through $450 million of share repurchases and $220 million of dividends paid.

Capital Allocation Update

The Company repurchased $450 million of shares in the first quarter and is reiterating its goal to repurchase approximately $1.2 billion of shares in 2025. Additionally, the Company will continue to pay quarterly dividends targeting dividend per share growth in line with Adjusted EPS growth.

Second Quarter and Full-Year 2025 Outlook

The Company is introducing its second quarter outlook and, for the full-year, is reiterating its outlook inclusive of accelerated revenue growth of 4.6 to 5.2% and Adjusted EPS growth of 9 to 11%.

($ millions, except share data)

2Q 2025

FY 2025

Revenue

$2,560 – $2,585

$10,435 – $10,495

Adjusted EBITDA (Non-GAAP)¹

$1,020 – $1,035

$4,305 – $4,335

Adjusted EPS (Non-GAAP)¹

$1.34 – $1.38

$5.70 – $5.80

¹The Company does not provide a reconciliation for non-GAAP estimates on a forward-looking basis where it is unable to provide a meaningful or accurate calculation or estimation of reconciling items and the information is not available without unreasonable effort.

Update on Pending Strategic Transactions

On April 17, 2025, FIS entered into definitive agreements to (i) buy the Issuer Solutions business from Global Payments Inc. (“Global Payments”) for an enterprise value of $13.5 billion, inclusive of $1.5 billion of anticipated net present value of tax assets, or a net purchase price of $12.0 billion, subject to customary adjustments (the “Issuer Solutions Acquisition”) and (ii) sell its remaining equity interest in Worldpay to Global Payments for a pre-tax value of $6.6 billion net of transaction fees and other costs (the “Worldpay Minority Interest Sale”).

FIS expects to fund the Issuer Solutions Acquisition through a combination of approximately $8 billion of new debt and the after-tax proceeds from the Worldpay Minority Interest Sale. Following the closing of the transactions, the Company expects pro forma gross leverage to be approximately 3.4x, deleveraging to its target gross leverage of 2.8x within 18 months.

The transactions are expected to close simultaneously in the first half of 2026, subject to regulatory approvals and other customary closing conditions.

Financial Reporting Considerations for Completed 2024 Worldpay Sale

On January 31, 2024, FIS sold a 55% stake in its Worldpay Merchant Solutions business to private equity funds managed by GTCR (the “2024 Worldpay Sale”).

Unless otherwise noted, all results are presented on a continuing operations basis and exclude the results of the Worldpay Merchant Solutions business that was classified as discontinued operations as of the third quarter of 2023.

Following the close of the 2024 Worldpay Sale, FIS retained a non-controlling 45% equity interest in a new standalone joint venture, Worldpay Holdco, LLC (“Worldpay”), and records its proportionate share of Worldpay’s earnings (loss) in the “Equity method investment earnings (loss), net of tax” (“EMI”) line of the income statement.

Webcast

FIS will host a live webcast of its earnings conference call with the investment community beginning at 8:30 a.m. (EDT) on Tuesday, May 6, 2025. To access the webcast, go to the Investor Relations section of FIS’ homepage, www.fisglobal.com. A replay will be available after the conclusion of the live webcast.

About FIS

FIS is a financial technology company providing solutions to financial institutions, businesses and developers. We unlock financial technology to the world across the money lifecycle underpinning the world’s financial system. Our people are dedicated to advancing the way the world pays, banks and invests, by helping our clients to confidently run, grow and protect their businesses. Our expertise comes from decades of experience helping financial institutions and businesses of all sizes adapt to meet the needs of their customers by harnessing where reliability meets innovation in financial technology. Headquartered in Jacksonville, Florida, FIS is a member of the Fortune 500® and the Standard & Poor’s 500® Index. To learn more, visit FISglobal.com. Follow FIS on LinkedIn, Facebook and X.

FIS Use of Non-GAAP Financial Information

Generally Accepted Accounting Principles (GAAP) is the term used to refer to the standard framework of guidelines for financial accounting in the United States. GAAP includes the standards, conventions, and rules accountants follow in recording and summarizing transactions and in the preparation of financial statements. In addition to reporting financial results in accordance with GAAP, we have provided certain non-GAAP financial measures.

These non-GAAP measures include constant currency revenue, Adjusted revenue growth, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted net earnings, Adjusted EPS, and Adjusted free cash flow. These non-GAAP measures may be used in this release and/or in the attached supplemental financial information.

We believe these non-GAAP measures help investors better understand the underlying fundamentals of our business. As further described below, the non-GAAP revenue and earnings measures presented eliminate items management believes are not indicative of FIS’ operating performance. The constant currency revenue and Adjusted revenue growth measures adjust for the effects of exchange rate fluctuations and exclude discontinued operations, while Adjusted revenue growth also excludes revenue from Corporate and Other, giving investors further insight into our performance. Finally, Adjusted free cash flow provides further information about the ability of our business to generate cash. For these reasons, management also uses these non-GAAP measures in its assessment and management of FIS’ performance.

Constant currency revenue represents reported segment revenue excluding the impact of fluctuations in foreign currency exchange rates in the current period.

Adjusted revenue growth reflects the percentage change in constant currency revenue for the current period as compared to the prior period. Constant currency revenue is calculated by applying prior-year period foreign currency exchange rates to current-period revenue. When referring to Adjusted revenue growth, revenue from our Corporate and Other segment is excluded.

Adjusted EBITDA reflects net earnings (loss) before interest, other income (expense), taxes, equity method investment earnings (loss), and depreciation and amortization, and excludes certain costs that do not constitute normal, recurring, cash operating expenses necessary to operate our business. These excluded costs generally include purchase price amortization of acquired intangible assets, as well as acquisition, integration and certain other costs and asset impairments. These excluded costs are recorded in the Corporate and Other segment. Adjusted EBITDA for the respective segments excludes the foregoing items. This measure is reported to the chief operating decision maker, the Company’s Chief Executive Officer and President, who utilizes the measure for purposes of making decisions about allocating resources to the segments and assessing their performance. For this reason, Adjusted EBITDA, as it relates to our segments, is presented in conformity with FASB ASC Topic 280, Segment Reporting.

Adjusted EBITDA margin reflects Adjusted EBITDA, as defined above, divided by revenue.

Adjusted net earnings excludes the effect of purchase price amortization, as well as certain costs that do not constitute normal, recurring, cash operating expenses necessary to operate our business. For purposes of calculating Adjusted net earnings, our equity method investment earnings (loss) (“EMI”) from Worldpay is also adjusted to exclude certain costs and other transactions in a similar manner.

Adjusted EPS reflects Adjusted net earnings, as defined above, divided by weighted average diluted shares outstanding.

Adjusted free cash flow reflects net cash provided by operating activities, adjusted for the net change in settlement assets and obligations and excluding certain transactions that are closely associated with non-operating activities or are otherwise non-operational in nature and not indicative of future operating cash flows, less capital expenditures. Adjusted free cash flow does not represent our residual cash flow available for discretionary expenditures since we have mandatory debt service requirements and other non-discretionary expenditures that are not deducted from the measure. Adjusted free cash flow as presented in this earnings release excludes cash flow from discontinued operations, which our management cannot freely access following the Worldpay separation.

Any non-GAAP measures should be considered in context with the GAAP financial presentation and should not be considered in isolation or as a substitute for GAAP measures. Further, FIS’ non-GAAP measures may be calculated differently from similarly titled measures of other companies. Reconciliations of these non-GAAP measures to related GAAP measures, including footnotes describing the adjustments, are provided in the attached schedules and in the Investor Relations section of the FIS website, www.fisglobal.com.

Forward-Looking Statements

This earnings release and today’s webcast contain “forward-looking statements” within the meaning of the U.S. federal securities laws. Statements that are not historical facts, as well as other statements about our expectations, beliefs, intentions, or strategies regarding the future, or other characterizations of future events or circumstances, are forward-looking statements. Forward-looking statements include statements about anticipated financial outcomes, including any earnings outlook or projections, projected revenue or expense synergies or dis-synergies, business and market conditions, outlook, foreign currency exchange rates, deleveraging plans, expected dividends and share repurchases of the Company, the Company’s sales pipeline and anticipated profitability and growth, plans, strategies and objectives for future operations, strategic value creation, risk profile and investment strategies, any statements regarding future economic conditions or performance and any statements with respect to the future impacts of the pending acquisition of Global Payments’ Issuer Solutions business (“Issuer Solutions”) and the pending sale of our remaining equity interest in Worldpay. These statements may be identified by words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “will,” “should,” “could,” “would,” “project,” “continue,” “likely,” and similar expressions, and include statements reflecting future results or outlook, statements of outlook and various accruals and estimates. These statements relate to future events and our future results and involve a number of risks and uncertainties. Forward-looking statements are based on management’s beliefs as well as assumptions made by, and information currently available to, management.

Actual results, performance or achievement could differ materially from these forward-looking statements. The risks and uncertainties to which forward-looking statements are subject include the following, without limitation:

changes in general economic, business and political conditions, a recession, intensified or expanded international hostilities, acts of terrorism, increased rates of inflation or interest, effects of announced or future tariff increases and any resulting regulatory changes in global trade relations, changes in consumer or business confidence; changes in either or both the United States and international lending, capital and financial markets or currency fluctuations;

the risk that acquired businesses will not be integrated successfully or that the integration will be more costly or more time-consuming and complex than anticipated;

the risk that cost savings and synergies anticipated to be realized from acquisitions may not be fully realized or may take longer to realize than expected or that costs may be greater than anticipated;

the risks of doing business internationally;

the effect of legislative initiatives or proposals, statutory changes, governmental or applicable regulations and/or changes in industry requirements, including privacy, data protection, cybersecurity, cyber resilience and AI laws and regulations;

our ability to comply with climate change legal and regulatory requirements and to maintain practices that meet our stakeholders’ evolving expectations;

the risks of reduction in revenue from the elimination of existing and potential customers due to consolidation in, or new laws or regulations affecting, the banking, retail and financial services industries or due to financial failures or other setbacks suffered by firms in those industries;

changes in the growth rates of the markets for our solutions;

the amount, declaration and payment of future dividends is at the discretion of our Board of Directors and depends on, among other things, our investment opportunities, results of operations, financial condition, cash requirements, future prospects, and other factors that may be considered relevant by our Board of Directors, including legal and contractual restrictions;

the amount and timing of any future share repurchases is subject to, among other things, our share price, our other investment opportunities and cash requirements, our results of operations and financial condition, our future prospects and other factors that may be considered relevant by our Board of Directors and management;

failures to adapt our solutions to changes in technology or in the marketplace;

internal or external security or privacy breaches of our systems, including those relating to unauthorized access, theft, corruption or loss of personal information and computer viruses and other malware affecting our software or platforms, and the reactions of customers, card associations, government regulators and others to any such events;

the risk that implementation of software, including software updates, for customers or at customer locations or employee error in monitoring our software and platforms may result in the corruption or loss of data or customer information, interruption of business operations, outages, exposure to liability claims or loss of customers;

the risk that partners and third parties may fail to satisfy their legal obligations to us;

risks associated with managing pension cost, cybersecurity issues, IT outages and data privacy;

our ability to navigate the opportunities and risks associated with using and/or incorporating AI technologies into our business;

the reaction of current and potential customers to communications from us or regulators regarding information security, risk management, internal audit or other matters;

the risk that the pending acquisition of Issuer Solutions will not be completed or will not provide the expected benefits, including the anticipated cost or revenue synergies, within the expected timeframe, in full or at all;

the risk that the integration of Issuer Solutions will be more difficult, time-consuming or expensive than anticipated;

competitive pressures on pricing related to the decreasing number of community banks in the U.S., the development of new disruptive technologies competing with one or more of our solutions, increasing presence of international competitors in the U.S. market and the entry into the market by global banks and global companies with respect to certain competitive solutions, each of which may have the impact of unbundling individual solutions from a comprehensive suite of solutions we provide to many of our customers;

the failure to innovate in order to keep up with new emerging technologies, which could impact our solutions and our ability to attract new, or retain existing, customers;

an operational or natural disaster at one of our major operations centers;

failure to comply with applicable requirements of payment networks or changes in those requirements;

fraud by bad actors; and

other risks detailed elsewhere in the “Risk Factors” section and other sections of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, and in our other filings with the Securities and Exchange Commission.

Other unknown or unpredictable factors also could have a material adverse effect on our business, financial condition, results of operations and prospects. Accordingly, readers should not place undue reliance on these forward-looking statements. These forward-looking statements are inherently subject to uncertainties, risks and changes in circumstances that are difficult to predict. Except as required by applicable law or regulation, we do not undertake (and expressly disclaim) any obligation and do not intend to publicly update or review any of these forward-looking statements, whether as a result of new information, future events or otherwise.

Fidelity National Information Services, Inc.

Earnings Release Supplemental Financial Information

May 6, 2025

Exhibit A

Condensed Consolidated Statements of Earnings (Loss) – Unaudited for the three months ended March 31, 2025 and 2024

Exhibit B

Condensed Consolidated Balance Sheets – Unaudited as of March 31, 2025, and December 31, 2024

Exhibit C

Condensed Consolidated Statements of Cash Flows – Unaudited for the three months ended March 31, 2025 and 2024

Exhibit D

Supplemental Non-GAAP Adjusted Revenue Growth – Unaudited for the three months ended March 31, 2025 and 2024

Exhibit E

Supplemental Disaggregation of Revenue – Recast and Unaudited for the three months ended March 31, 2025 and 2024

Exhibit F

Supplemental Non-GAAP Adjusted Free Cash Flow Measures – Unaudited for the three months ended March 31, 2025 and 2024

Exhibit G

Supplemental GAAP to Non-GAAP Reconciliations – Unaudited for the three months ended March 31, 2025 and 2024

Exhibit H

Supplemental Financial Information of Worldpay Holdco, LLC – Unaudited for the three months ended March 31, 2025, and two months ended March 31, 2024

FIDELITY NATIONAL INFORMATION SERVICES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (LOSS)— UNAUDITED

(In millions, except per share amounts)

Exhibit A

Three months ended March 31,

2025

2024

Revenue

$

2,532

$

2,468

Cost of revenue

1,653

1,559

Gross profit

879

909

Selling, general, and administrative expenses

558

573

Asset impairments

2

14

Other operating (income) expense, net – related party

(28

)

(33

)

Operating income

347

355

Other income (expense):

Interest expense, net

(80

)

(77

)

Other income (expense), net

(37

)

(172

)

Total other income (expense), net

(117

)

(249

)

Earnings (loss) before income taxes and equity method investment earnings (loss)

230

106

Provision (benefit) for income taxes

81

20

Equity method investment earnings (loss), net of tax

(71

)

(86

)

Net earnings (loss) from continuing operations

78

—

Earnings (loss) from discontinued operations, net of tax

—

707

Net earnings (loss)

78

707

Net (earnings) loss attributable to noncontrolling interest from continuing operations

(1

)

(1

)

Net earnings (loss) attributable to FIS

$

77

$

706

Net earnings (loss) attributable to FIS:

Continuing operations

$

77

$

(1

)

Discontinued operations

—

707

Total

$

77

$

706

Basic earnings (loss) per common share attributable to FIS:

Continuing operations

$

0.15

$

—

Discontinued operations

—

1.23

Total

$

0.15

$

1.23

Diluted earnings (loss) per common share attributable to FIS:

Continuing operations

$

0.15

$

—

Discontinued operations

—

1.22

Total

$

0.15

$

1.22

Weighted average common shares outstanding:

Basic

528

576

Diluted

531

578

Prior-year 2024 amounts have been revised to correct certain immaterial misstatements. For more information, see footnote 24 to the Company’s Annual Report for the year ended December 31, 2024, filed with the SEC on Form 10-K on February 13, 2025.

Amounts in table may not sum or calculate due to rounding.

FIDELITY NATIONAL INFORMATION SERVICES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS — UNAUDITED

(In millions, except per share amounts)

Exhibit B

March 31,

2025

December 31,

2024

ASSETS

Current assets:

Cash and cash equivalents

$

805

$

834

Settlement assets

789

479

Trade receivables, net

1,920

1,876

Other receivables

164

160

Receivable from related party

28

84

Prepaid expenses and other current assets

704

638

Current assets held for sale

—

1,115

Total current assets

4,410

5,186

Property and equipment, net

689

646

Goodwill

17,328

17,260

Intangible assets, net

1,211

1,318

Software, net

2,560

2,526

Equity method investment

3,795

3,858

Other noncurrent assets

1,619

1,749

Deferred contract costs, net

1,229

1,241

Total assets

$

32,841

$

33,784

LIABILITIES AND EQUITY

Current liabilities:

Accounts payable, accrued and other liabilities

$

1,829

$

1,994

Settlement payables

799

500

Deferred revenue

964

902

Short-term borrowings

1,108

636

Current portion of long-term debt

2,254

968

Current liabilities held for sale

—

1,094

Total current liabilities

6,954

6,094

Long-term debt, excluding current portion

8,658

9,686

Deferred income taxes

790

863

Other noncurrent liabilities

1,371

1,441

Total liabilities

17,773

18,084

Equity:

FIS stockholders’ equity:

Preferred stock $0.01 par value

—

—

Common stock $0.01 par value

6

6

Additional paid in capital

47,174

47,129

(Accumulated deficit) retained earnings

(22,392

)

(22,257

)

Accumulated other comprehensive earnings (loss)

(381

)

(364

)

Treasury stock, at cost

(9,343

)

(8,816

)

Total FIS stockholders’ equity

15,064

15,698

Noncontrolling interest

4

2

Total equity

15,068

15,700

Total liabilities and equity

$

32,841

$

33,784

Prior-year 2024 amounts have been revised to correct certain immaterial misstatements. For more information, see footnote 24 to the Company’s Annual Report for the year ended December 31, 2024, filed with the SEC on Form 10-K on February 13, 2025.

Amounts in table may not sum or calculate due to rounding.

FIDELITY NATIONAL INFORMATION SERVICES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS — UNAUDITED (In millions)

Exhibit C

Three months ended March 31,

2025

2024

Cash flows from operating activities from continuing operations:

Net earnings (loss)

$

78

$

707

Less earnings (loss) from discontinued operations, net of tax

—

707

Net earnings (loss) from continuing operations

78

—

Adjustment to reconcile net earnings (loss) from continuing operations to net cash provided by operating activities:

Depreciation and amortization

456

428

Amortization of debt issuance costs

4

6

Asset impairments

2

14

Loss on extinguishment of debt

—

174

Loss (gain) on sale of businesses, investments and other

31

14

Stock-based compensation

47

31

Loss from equity method investment

71

86

Deferred income taxes

(9

)

(64

)

Net changes in assets and liabilities, net of effects from acquisitions and foreign currency:

Trade and other receivables

(9

)

136

Receivable from related party

55

(153

)

Settlement activity

(10

)

12

Prepaid expenses and other assets

(34

)

(116

)

Deferred contract costs

(71

)

(115

)

Deferred revenue

65

45

Accounts payable, accrued liabilities and other liabilities

(219

)

(292

)

Net cash provided by operating activities from continuing operations

457

206

Cash flows from investing activities from continuing operations:

Additions to property and equipment

(37

)

(27

)

Additions to software

(196

)

(175

)

Settlement of net investment hedge cross-currency interest rate swaps

—

5

Net proceeds from sale of businesses and investments

—

12,795

Cash divested from sale of business

(1,417

)

(3,137

)

Acquisitions, net of cash acquired

(1

)

(56

)

Coupon payments on interest rate swaps

(22

)

(22

)

Other investing activities, net

(3

)

(2

)

Net cash provided by (used in) investing activities from continuing operations

(1,676

)

9,381

Cash flows from financing activities from continuing operations:

Borrowings

12,488

13,441

Repayment of borrowings and other financing arrangements

(12,029

)

(21,379

)

Treasury stock activity

(537

)

(1,342

)

Dividends paid

(220

)

(209

)

Other financing activities, net

33

43

Net cash provided by (used in) financing activities from continuing operations

(265

)

(9,446

)

Cash flows from discontinued operations:

Net cash provided by (used in) operating activities

303

(241

)

Net cash provided by (used in) investing activities

—

(39

)

Net cash provided by (used in) financing activities

—

(65

)

Net cash provided by (used in) discontinued operations

303

(345

)

Effect of foreign currency exchange rate changes on cash from continuing operations

40

(17

)

Effect of foreign currency exchange rate changes on cash from discontinued operations

—

(25

)

Net increase (decrease) in cash, cash equivalents and restricted cash

(1,141

)

(246

)

Cash, cash equivalents and restricted cash, beginning of period

1,946

4,414

Cash, cash equivalents and restricted cash, end of period

$

805

$

4,168

FIDELITY NATIONAL INFORMATION SERVICES, INC.

SUPPLEMENTAL NON-GAAP ADJUSTED REVENUE GROWTH — UNAUDITED

(In millions)

Exhibit D

Three months ended March 31,

2025

2024

Constant

Currency

Adjusted

Revenue

FX

Revenue

Revenue

Growth (1)

Banking Solutions

$

1,718

$

6

$

1,724

$

1,685

2

%

Capital Market Solutions

764

2

767

706

9

%

Operating segment total

2,482

8

2,490

2,391

4

%

Corporate and Other

50

2

52

77

Consolidated FIS

$

2,532

$

10

$

2,542

$

2,468

Prior-year 2024 amounts have been revised to correct certain immaterial misstatements. For more information, see footnote 24 to the Company’s Annual Report for the year ended December 31, 2024, filed with the SEC on Form 10-K on February 13, 2025.

Amounts in table may not sum or calculate due to rounding.

(1)
Adjusted growth excludes Corporate and Other. The Corporate and Other segment includes certain non-strategic businesses that we plan to wind down or sell.

FIDELITY NATIONAL INFORMATION SERVICES, INC.

SUPPLEMENTAL DISAGGREGATION OF REVENUE — UNAUDITED

(In millions)

Exhibit E

In the following tables, revenue is disaggregated by primary geographical market and type of revenue. The tables also include a reconciliation of the disaggregated revenue with the Company’s reportable segments.

For the three months ended March 31, 2025 (in millions):

Banking

Solutions

Capital

Market

Solutions

Corporate

and Other

Total

Primary Geographical Markets:

North America

$

1,491

$

475

$

22

$

1,988

All others

227

289

28

544

Total

$

1,718

$

764

$

50

$

2,532

Type of Revenue:

Recurring revenue:

Transaction processing and services

$

1,290

$

394

$

43

$

1,727

Software maintenance

95

147

1

243

Other recurring

69

24

1

94

Total recurring

1,454

565

45

2,064

Software license

28

102

—

130

Professional services

123

91

1

215

Other non-recurring

113

6

4

123

Total

$

1,718

$

764

$

50

$

2,532

For the three months ended March 31, 2024 (in millions):

Banking

Solutions

Capital

Market

Solutions

Corporate

and Other

Total

Primary Geographical Markets:

North America

$

1,432

$

445

$

41

$

1,918

All others

253

261

36

550

Total

$

1,685

$

706

$

77

$

2,468

Type of Revenue:

Recurring revenue:

Transaction processing and services (1)

$

1,267

$

378

$

56

$

1,701

Software maintenance

90

143

—

233

Other recurring (1)

60

15

1

76

Total recurring

1,417

536

57

2,010

Software license

50

74

—

124

Professional services

132

96

1

229

Other non-recurring

86

—

19

105

Total

$

1,685

$

706

$

77

$

2,468

(1)
Revenue related primarily to software licenses requiring frequent, integral updates has been classified as Transaction processing and services revenue commencing in the quarter ended December 31, 2024, and related prior-period amounts have been reclassified from Other recurring revenue to Transaction processing and services for comparability. Revenue reclassified for the three months ended March 31, 2024, was $4 million, $7 million and $9 million within Banking, Capital Markets and Corporate and Other, respectively.

Prior-year 2024 amounts have been revised to correct certain immaterial misstatements. For more information, see footnote 24 to the Company’s Annual Report for the year ended December 31, 2024, filed with the SEC on Form 10-K on February 13, 2025.

Amounts in table may not sum or calculate due to rounding.

FIDELITY NATIONAL INFORMATION SERVICES, INC.

SUPPLEMENTAL NON-GAAP CASH FLOW MEASURES — UNAUDITED

(In millions)

Exhibit F

Three months ended

March 31, 2025

March 31, 2024

Net cash provided by operating activities

$

457

$

206

Non-GAAP adjustments:

Acquisition, integration and other payments (1)

134

103

Settlement activity

10

(12

)

Adjusted cash flows from operations

601

297

Capital expenditures

(233

)

(202

)

Adjusted free cash flow

$

368

$

95

Adjusted free cash flow reflects adjusted cash flows from operations less capital expenditures (additions to property and equipment and additions to software from the statement of cash flows). Adjusted free cash flow does not represent our residual cash flows available for discretionary expenditures, since we have mandatory debt service requirements and other non-discretionary expenditures that are not deducted from the measure. Adjusted free cash flow as presented in this earnings release excludes cash flows from discontinued operations.

(1)
Adjusted free cash flows from operations and free cash flow for the three months ended March 31, 2025 and 2024, exclude cash payments for certain acquisition, integration and other costs (see Note 2 to Exhibit G), net of related tax impact. The related tax impact totaled $18 million and $18 million for the three months ended March 31, 2025 and 2024, respectively.

FIDELITY NATIONAL INFORMATION SERVICES, INC.

SUPPLEMENTAL GAAP TO NON-GAAP RECONCILIATIONS — UNAUDITED

(In millions, except per share amounts)

Exhibit G

Three months ended March 31,

2025

2024

Net earnings (loss) attributable to FIS from continuing operations

$

77

$

(1

)

Provision (benefit) for income taxes

81

20

Interest expense, net

80

77

Equity method investment (earnings) loss, net of tax

71

86

Other, net

38

173

Operating income (loss), as reported

347

355

Depreciation and amortization, excluding purchase accounting amortization

287

263

Non-GAAP adjustments:

Purchase accounting amortization (1)

169

165

Acquisition, integration and other costs (2)

153

158

Asset impairments (3)

2

14

Indirect Worldpay business support costs (4)

—

14

Adjusted EBITDA from continuing operations

$

958

$

969

Net earnings (loss) attributable to FIS from discontinued operations

$

—

$

707

Provision (benefit) for income taxes

—

(991

)

Interest expense, net

(1

)

(1

)

Other, net

(1

)

470

Operating income (loss)

(2

)

185

Depreciation and amortization, excluding purchase accounting amortization

—

3

Non-GAAP adjustments:

Acquisition, integration and other costs (2)

—

13

Indirect Worldpay business support costs (4)

—

(14

)

Adjusted EBITDA from discontinued operations

$

(2

)

$

187

Adjusted EBITDA

$

956

$

1,156

See Notes to Exhibit G.

Prior-year 2024 amounts have been revised to correct certain immaterial misstatements. For more information, see footnote 24 to the Company’s Annual Report for the year ended December 31, 2024, filed with the SEC on Form 10-K on February 13, 2025.

Amounts in table may not sum or calculate due to rounding.

FIDELITY NATIONAL INFORMATION SERVICES, INC.

SUPPLEMENTAL GAAP TO NON-GAAP RECONCILIATIONS — UNAUDITED

(In millions, except per share amounts)

Exhibit G (continued)

Three months ended March 31,

2025

2024

Earnings (loss) attributable to FIS from continuing operations

$

77

$

(1

)

Equity method investment (earnings) loss, net of tax

71

86

Earnings (loss) attributable to FIS from continuing operations, excluding equity method investment earnings (loss)

148

85

Non-GAAP adjustments from continuing operations:

Purchase accounting amortization (1)

169

165

Acquisition, integration and other costs (2)

153

158

Asset impairments (3)

2

14

Indirect Worldpay business support costs (4)

—

14

Non-operating (income) expense (5)

37

172

Non-GAAP tax (provision) benefit (6)

10

(71

)

Total non-GAAP adjustments from continuing operations

371

452

Adjusted net earnings attributable to FIS from continuing operations, excluding equity method investment earnings (loss)

519

537

Equity method investment earnings (loss), net of tax (7)

(71

)

(86

)

Non-GAAP adjustments on equity method investment earnings (loss), net of related (provision) benefit for income taxes (7) (8)

195

178

Adjusted equity method investment earnings (loss) (7)

124

92

Adjusted net earnings attributable to FIS from continuing operations

$

643

$

629

Earnings (loss) attributable to FIS from discontinued operations, net of tax

$

—

$

707

Non-GAAP adjustments from discontinued operations:

Acquisition, integration and other costs (2)

—

13

Loss on sale of disposal group (10)

—

466

Indirect Worldpay business support costs (4)

—

(14

)

Amortization on long-lived assets held for sale (9)

—

(30

)

Non-operating (income) expense (5)

—

6

Non-GAAP tax (provision) benefit (6)

—

(1,015

)

Total non-GAAP adjustments from discontinued operations

—

(574

)

Adjusted net earnings attributable to FIS from discontinued operations

$

—

$

133

Adjusted net earnings attributable to FIS common stockholders

$

643

$

762

See Notes to Exhibit G.

Prior-year 2024 amounts have been revised to correct certain immaterial misstatements. For more information, see footnote 24 to the Company’s Annual Report for the year ended December 31, 2024, filed with the SEC on Form 10-K on February 13, 2025.

Amounts in table may not sum or calculate due to rounding.

FIDELITY NATIONAL INFORMATION SERVICES, INC.

SUPPLEMENTAL GAAP TO NON-GAAP RECONCILIATIONS — UNAUDITED

(In millions, except per share amounts)

Exhibit G (continued)

Three months ended March 31,

2025

2024

Earnings (loss) attributable to FIS from continuing operations

$

0.15

$

—

Equity method investment (earnings) loss, net of tax

0.13

0.15

Earnings (loss) attributable to FIS from continuing operations, excluding equity method investment earnings (loss)

0.28

0.15

Non-GAAP adjustments from continuing operations:

Purchase accounting amortization (1)

0.32

0.29

Acquisition, integration and other costs (2)

0.29

0.27

Asset impairments (3)

—

0.02

Indirect Worldpay business support costs (4)

—

0.02

Non-operating (income) expense (5)

0.07

0.30

Non-GAAP tax (provision) benefit (6)

0.02

(0.12

)

Total non-GAAP adjustments from continuing operations

0.70

0.78

Adjusted net earnings attributable to FIS from continuing operations, excluding equity method investment earnings (loss)

0.98

0.93

Equity method investment earnings (loss) (7)

(0.13

)

(0.15

)

Non-GAAP adjustments on equity method investment earnings (loss), net of related (provision) benefit for income taxes (7) (8)

0.37

$

0.31

Adjusted equity method investment earnings (loss) (7)

0.23

0.16

Adjusted net earnings attributable to FIS from continuing operations

$

1.21

$

1.09

Earnings (loss) attributable to FIS from discontinued operations, net of tax

$

—

$

1.22

Non-GAAP adjustments from discontinued operations:

Acquisition, integration and other costs (2)

—

0.02

Loss on sale of disposal group (10)

—

0.81

Indirect Worldpay business support costs (4)

—

(0.02

)

Amortization on long-lived assets held for sale (9)

—

(0.05

)

Non-operating (income) expense (5)

—

0.01

Non-GAAP tax (provision) benefit (6)

—

(1.76

)

Total non-GAAP adjustments from discontinued operations

—

(0.99

)

Adjusted net earnings attributable to FIS from discontinued operations

$

—

$

0.23

Adjusted net earnings attributable to FIS common stockholders

$

1.21

$

1.32

Weighted average shares outstanding-diluted

531

578

See Notes to Exhibit G.

Prior-year 2024 amounts have been revised to correct certain immaterial misstatements. For more information, see footnote 24 to the Company’s Annual Report for the year ended December 31, 2024, filed with the SEC on Form 10-K on February 13, 2025.

Amounts in table may not sum or calculate due to rounding.

FIDELITY NATIONAL INFORMATION SERVICES, INC.

SUPPLEMENTAL GAAP TO NON-GAAP RECONCILIATIONS — UNAUDITED

(In millions, except per share amounts)

Exhibit G (continued)

Notes to Unaudited – Supplemental GAAP to Non-GAAP Reconciliations for the three months ended March 31, 2025 and 2024.

(1)
This item represents purchase price amortization expense on all intangible assets acquired through various Company acquisitions, including customer relationships, contract value, technology assets, trademarks and trade names. The Company has excluded the impact of purchase price amortization expense as such amounts can be significantly impacted by the timing and/or size of acquisitions. Although the Company excludes these amounts from its non-GAAP expenses, the Company believes that it is important for investors to understand that such intangible assets contribute to revenue generation. Amortization of assets that relate to past acquisitions will recur in future periods until such assets have been fully amortized. Any future acquisitions may result in the amortization of future assets.

(2)
This item represents costs comprised of the following:

Three months ended

March 31,

2025

2024

Continuing operations:

Acquisition and integration

$

8

$

24

Enterprise transformation, including Future Forward and platform modernization

46

73

Severance and other termination expenses

59

18

Separation of the Worldpay Merchant Solutions business

21

30

Incremental stock compensation directly attributable to specific programs

10

11

Other, including divestiture-related expenses and enterprise cost control and other initiatives

9

2

Total from continuing operations

$

153

$

158

Discontinued operations:

Acquisition and integration

$

—

$

—

Enterprise transformation, including Future Forward and platform modernization

—

1

Severance and other termination expenses

—

1

Separation of the Worldpay Merchant Solutions business

—

8

Other, including divestiture-related expenses and enterprise cost control and other initiatives

—

3

Total from discontinued operations

—

13

Total consolidated

$

153

$

171

Amounts in table may not sum due to rounding.

(3)
For the three months ended March 31, 2024, this item includes impairments primarily related to the termination of certain internally developed software projects.

(4)
This item represents costs that were incurred in support of the Worldpay Merchant Solutions business prior to the separation but are not directly attributable to it and thus were not recorded in discontinued operations. The Company is being reimbursed for these expenses as part of Transition Services Agreements with the buyer and/or eliminated them post separation; therefore, the expenses have been adjusted out of continuing operations and added to discontinued operations.

(5)
Non-operating (income) expense primarily consists of other income and expense items outside of the Company’s operating activities, including fair value adjustments on certain non-operating assets and liabilities and foreign currency transaction remeasurement gains and losses. For the three months ended March 31, 2024, earnings from continuing operations also includes loss on extinguishment of debt of approximately $174 million relating to tender discounts and fees; the write-off of unamortized bond discounts, debt issuance costs and fair value basis adjustments; and gains on related derivative instruments.

(6)
This adjustment is based on an adjusted effective tax rate of 12.0% and 14.5% for the periods ended March 31, 2025 and 2024, respectively, which reflects adjustments to our GAAP effective tax rate to take into account primarily certain cash tax benefits from our equity method investment in Worldpay. For the three months ended March 31, 2024, the Company recorded a tax benefit of $991 million in its earnings from discontinued operations primarily from the write-off of U.S. deferred tax liabilities that were not transferred in the 2024 Worldpay Sale, net of the estimated U.S. tax cost that the Company expects to incur as a result of the 2024 Worldpay Sale. This adjustment includes the removal of the impact of this tax benefit from our earnings from discontinued operations for this period.

(7)
FIS completed the separation of Worldpay on January 31, 2024, retaining a non-controlling 45% ownership interest that is recorded under the equity method of accounting. FIS’ share of Worldpay’s results under the equity method of accounting reflects activity beginning on February 1, 2024.

(8)
This item represents FIS’ proportionate share of Worldpay’s non-GAAP adjustments on its earnings (loss) consistent with FIS’ non-GAAP measures and is comprised of the following:

Three months ended

March 31, 2025

Two months ended

March 31, 2024

FIS’ share of Worldpay:

Purchase accounting amortization

$

158

$

135

Acquisition, integration and other costs (a)

49

85

Non-operating (income) expense

11

(8

)

Non-GAAP tax (provision) benefit

(23

)

(34

)

Non-GAAP adjustments on equity method investment earnings (loss), net of related (provision) benefit for income taxes

$

195

$

178

Amounts in table may not sum due to rounding.

(a)
Worldpay acquisition, integration, and other costs for the three months ended March 31, 2025 and 2024, consist primarily of transaction and transition costs related to the separation from FIS.

(9) The Company stopped recording depreciation and amortization on the long-lived assets classified as held for sale beginning July 5, 2023. The amount of depreciation and amortization that would have been recorded in discontinued operations had these assets not been classified as held for sale has been deducted from adjusted net earnings for comparability purposes.

(10) During the three months ended March 31, 2024, an initial loss on sale of disposal group of $466 million was recorded upon closing of the 2024 Worldpay Sale to reflect the impact of the excess of the carrying value of the disposal group over the estimated fair value less cost to sell.

FIDELITY NATIONAL INFORMATION SERVICES, INC.

SUPPLEMENTAL FINANCIAL INFORMATION OF WORLDPAY HOLDCO, LLC — UNAUDITED

(In millions)

Exhibit H

Summary Worldpay Holdco, LLC financial information is as follows:

Three months ended

March 31, 2025

Two months ended

March 31, 2024 (1)

Revenue

$

1,281

$

832

Gross profit

$

613

$

385

Earnings (loss) before income taxes

$

(180

)

$

(230

)

Net earnings (loss) attributable to Worldpay Holdco, LLC

$

(217

)

$

(243

)

FIS share of net earnings (loss) attributable to Worldpay Holdco, LLC, net of tax (2)

$

(71

)

$

(86

)

The following is a GAAP to Non-GAAP reconciliation of Adjusted EBITDA for Worldpay Holdco LLC.

Three months ended

March 31, 2025

Two months ended

March 31, 2024 (1)

Net earnings (loss) attributable to Worldpay Holdco, LLC

$

(217

)

$

(243

)

Provision (benefit) for income taxes

36

12

Interest expense, net

144

116

Other, net

31

(17

)

Operating income (loss)

(6

)

(132

)

Depreciation and amortization, excluding purchase accounting amortization

47

10

Non-GAAP adjustments:

Purchase accounting amortization

351

300

Transition, acquisition, integration and other costs (3)

108

188

Adjusted EBITDA

$

500

$

366

(1)
FIS completed the separation of Worldpay on January 31, 2024. Accordingly, Worldpay’s results reflects activity beginning on February 1, 2024.

(2)
Amount includes our share of the net income attributable to Worldpay and our investor-level tax benefit of $22 million and $23 million for the three months ended March 31, 2025, and two months ended March 31, 2024, respectively, as well as, intra-entity eliminations, and is reported as equity method investment earnings (loss), net of tax on our consolidated statement of earnings.

(3)
This item represents primarily transaction and transition costs associated with the separation of Worldpay from FIS.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250506789003/en/

For More Information

Ellyn Raftery, 904.438.6083

Chief Marketing & Communications Officer

FIS Global Marketing & Corporate Communications

[email protected]

George Mihalos, 904.438.6438

Senior Vice President

FIS Investor Relations

[email protected]

KEYWORDS: United States North America Florida

INDUSTRY KEYWORDS: Technology Mobile/Wireless Payments Finance Banking Professional Services Software Hardware Data Management

MEDIA:

Logo

Posted on May 6, 2025 7:13 am
First Watch Restaurant Group, Inc. Reports Q1 2025 Financial Results

Total revenues increased
16.4%

Net loss of
$(0.8) million
and Adjusted EBITDA of
$22.8 million

13
new system-wide restaurants opened in
10
states

BRADENTON, Fla., May 06, 2025 (GLOBE NEWSWIRE) — First Watch Restaurant Group, Inc. (NASDAQ: FWRG) (“First Watch” or the “Company”), the leading Daytime Dining concept serving breakfast, brunch and lunch, today reported financial results for the thirteen weeks ended March 30, 2025 (“Q1 2025”).

“First quarter same restaurant traffic results are encouraging and continued the trends we experienced exiting 2024, demonstrating both the strength and the resilience of the First Watch brand,” said Chris Tomasso, CEO and President of First Watch. “Additionally, the continuing success from our new restaurant openings serves as a significant long-term value creator. Despite the uncertainty present in the coming macroeconomic environment, both the 2024 and 2025 NRO classes continue to exceed expectations, and our development pipeline for the remainder of the year and beyond remains robust.”

Highlights:

Total revenues increased 16.4% to $282.2 million in Q1 2025 from $242.4 million in Q1 2024

System-wide sales increased 11.5% to $323.0 million in Q1 2025 from $289.6 million in Q1 2024

Same-restaurant sales growth of 0.7%

Same-restaurant traffic growth of negative 0.7%

Income from operations margin decreased to 0.4% in Q1 2025 from 5.1% in Q1 2024

Restaurant level operating profit margin* decreased to 16.5% in Q1 2025 from 20.8% in Q1 2024

Net income (loss) decreased to $(0.8) million, or $(0.01) per diluted share, in Q1 2025 from $7.2 million, or $0.12 per diluted share, in Q1 2024

Adjusted EBITDA* decreased to $22.8 million in Q1 2025 from $28.6 million in Q1 2024

Opened 13 system-wide restaurants in 10 states, 1 closure, resulting in a total of 584 system-wide restaurants (498 company-owned and 86 franchise-owned) across 30 states

___________________
* See Non-GAAP Financial Measures Reconciliations section below.

For additional financial information related to Q1 2025, refer to the Company’s quarterly report on Form 10-Q filed with the Securities and Exchange Commission on May 6, 2025, which can be accessed at https://investors.firstwatch.com in the Financials & Filings section.

Updated Outlook Fiscal Year 2025

Based upon first quarter results and current trends, the Company updated the following guidance metrics for the 52-week fiscal year ending December 28, 2025:

Adjusted EBITDA⁽¹⁾ in the range of $114.0 million to $119.0 million⁽²⁾

Blended tax rate of 45.0%-50.0%

The Company confirmed the following guidance metrics for the 52-week fiscal year ending December 28, 2025:

Same-restaurant sales growth percentage in the positive low-single digits with flat-to-slightly positive same-restaurant traffic growth percentage

Total revenue growth of ~20.0%⁽²⁾

Total of 59 to 64 new system-wide restaurants, net of 3 company-owned restaurant closures (55 to 58 new company-owned restaurants and 7 to 9 new franchise-owned restaurants).

Capital expenditures in the range of $150.0 million to $160.0 million invested primarily in new restaurant projects and planned remodels⁽³⁾

______________________

(1) We have not reconciled guidance for Adjusted EBITDA to the corresponding GAAP financial measure because we do not provide guidance for the various reconciling items. We are unable to provide guidance for these reconciling items because we cannot determine their probable significance, as certain items are outside of our control and cannot be reasonably predicted due to the fact that these items could vary significantly from period to period. Accordingly, a reconciliation to the corresponding GAAP financial measure is not available without unreasonable effort.

(2) Includes net impact of approximately 4% in total revenue growth and approximately $7 million in Adjusted EBITDA associated with completed acquisitions.

(3) Does not include the capital outlays associated with the acquisition of franchise-owned restaurants.

Conference Call and Webcast

Chris Tomasso, Chief Executive Officer and President, and Mel Hope, Chief Financial Officer, will host a conference call and webcast to discuss these financial results for Q1 2025 on May 6, 2025 at 8:00 AM ET.

Interested parties may listen to the conference call via any one of two options:

Dial 201-389-0914, which will be answered by an operator

Join the webcast at https://investors.firstwatch.com/news-and-events/events

The webcast will be archived shortly after the call has concluded.

Definitions

The following definitions apply to these terms as used in this release:

System-wide restaurants: the total number of restaurants, including all company-owned and franchise- owned restaurants.

System-wide sales: consists of restaurant sales from our company-owned restaurants and franchise-owned restaurants. We do not recognize the restaurant sales from our franchise-owned restaurants as revenue.

Same-restaurant sales growth: the percentage change in year-over-year restaurant sales (excluding gift card breakage) for the comparable restaurant base, which is defined as the number of company-owned First Watch branded restaurants open for 18 months or longer as of the beginning of the fiscal year (“Comparable Restaurant Base”). For the thirteen weeks ended March 30, 2025 and March 31, 2024, there were 383 restaurants and 344 restaurants, respectively, in our Comparable Restaurant Base.

Same-restaurant traffic growth: the percentage change in traffic counts as compared to the same period in the prior year using the Comparable Restaurant Base. For the thirteen weeks ended March 30, 2025 and March 31, 2024, there were 383 restaurants and 344 restaurants, respectively, in our Comparable Restaurant Base.

Adjusted EBITDA: a non-GAAP measure, is defined as net income (loss) before depreciation and amortization, interest expense, income taxes and items that the Company does not consider in the evaluation of its ongoing core operating performance.

Adjusted EBITDA margin: a non-GAAP measure, is defined as Adjusted EBITDA as a percentage of total revenues.

Restaurant level operating profit: a non-GAAP measure, is defined as restaurant sales, less restaurant operating expenses, which include food and beverage costs, labor and other related expenses, other restaurant operating expenses, pre-opening expenses and occupancy expenses. In addition, Restaurant level operating profit excludes corporate-level expenses and items that are not considered in the Company’s evaluation of its ongoing core operating performance.

Restaurant level operating profit margin: a non-GAAP measure, is defined as Restaurant level operating profit as a percentage of restaurant sales.

About First Watch

First Watch is the leading Daytime Dining concept serving made-to-order breakfast, brunch and lunch using fresh ingredients. A recipient of hundreds of local “Best Breakfast” and “Best Brunch” accolades, First Watch’s chef-driven menu rotates five times a year and includes elevated executions of classic favorites alongside specialties such as its Quinoa Power Bowl, Lemon Ricotta Pancakes, Chickichanga, Morning Meditation fresh juice and signature Million Dollar Bacon. After first appearing on the list in 2022 and 2023, First Watch was named 2024’s #1 Most Loved Workplace® in America by Newsweek and the Best Practice Institute. In 2023, First Watch was named the top restaurant brand in Yelp’s inaugural list of the top 50 most-loved brands in the U.S. In 2022, First Watch was awarded a sought-after MenuMasters honor by Nation’s Restaurant News for its seasonal Braised Short Rib Omelet. First Watch operates more than 580 First Watch restaurants in 31 states. For more information, visit www.firstwatch.com.

Forward-Looking Statements

This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which are subject to known and unknown risks, uncertainties and other important factors that may cause actual results to be materially different from the statements made herein. All statements other than statements of historical fact are forward-looking statements. Forward-looking statements discuss our current expectations and projections relating to our financial position, results of operations, plans, objectives, future performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to any historical or current facts. These statements may include words such as “aim,” “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “future,” “intend,” “outlook,” “potential,” “project,” “projection,” “plan,” “seek,” “may,” “could,” “would,” “will,” “should,” “can,” “can have,” “likely,” the negatives thereof and other similar expressions. You should evaluate all forward-looking statements made in this press release in the context of the risks and uncertainties disclosed herein, in our Annual Report on Form 10-K as of and for the year ended December 29, 2024, including under Part I. Item 1A. “Risk Factors” and Part II. Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and our other filings with the Securities and Exchange Commission (the “SEC”), accessible on the SEC’s website at www.sec.gov and the Investors Relations section of the Company’s website at https://investors.firstwatch.com/financial-information/sec-filings. Important factors that could cause actual results to differ materially from those in the forward-looking statements include the following: our vulnerability to changes in consumer preferences and economic conditions such as inflation and recession; uncertainty regarding the Russia and Ukraine war, Israel-Hamas war and the related impact on macroeconomic conditions, including inflation, as a result of such conflicts or other related events; our vulnerability to changes in economic conditions and consumer preferences; our inability to successfully open new restaurants or establish new markets; our inability to effectively manage our growth; potential negative impacts on sales at our and our franchisees’ restaurants as a result of our opening new restaurants; a decline in visitors to any of the retail centers, lifestyle centers, or entertainment centers where our restaurants are located; lower than expected same-restaurant sales growth; unsuccessful marketing programs and limited time new offerings; changes in the cost of food; unprofitability or closure of new restaurants or lower than previously experienced performance in existing restaurants; our inability to compete effectively for customers; unsuccessful financial performance of our franchisees; our limited control over our franchisees’ operations; our inability to maintain good relationships with our franchisees; conflicts of interest with our franchisees; the geographic concentration of our system-wide restaurant base in the southeast portion of the United States; damage to our reputation and negative publicity; our inability or failure to recognize, respond to and effectively manage the accelerated impact of social media; our limited number of suppliers and distributors for several of our frequently used ingredients and shortages or disruptions in the supply or delivery of such ingredients; information technology system failures or breaches of our network security; our failure to comply with federal and state laws and regulations relating to privacy, data protection, advertising and consumer protection, or the expansion of current or the enactment of new laws or regulations relating to privacy, data protection, advertising and consumer protection; our potential liability with our gift cards under the property laws of some states; our failure to enforce and maintain our trademarks and protect our other intellectual property; litigation with respect to intellectual property assets; our dependence on our executive officers and certain other key employees; our inability to identify, hire, train and retain qualified individuals for our workforce; our failure to obtain or to properly verify the employment eligibility of our employees; our failure to maintain our corporate culture as we grow; unionization activities among our employees; employment and labor law proceedings; labor shortages or increased labor costs or health care costs; risks associated with leasing property subject to long-term and non-cancelable leases; risks related to our sale of alcoholic beverages; costly and complex compliance with federal, state and local laws; changes in accounting principles applicable to us; our vulnerability to natural disasters, unusual weather conditions, pandemic outbreaks, political events, war and terrorism; our inability to secure additional capital to support business growth; our level of indebtedness; failure to comply with covenants under our credit facility; and the interests of our largest stockholder may differ from those of public stockholders.

The forward-looking statements included in this press release are made only as of the date hereof and are expressly qualified in their entirety by these cautionary statements. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law. All information presented herein is based on our fiscal calendar. Unless otherwise stated, references to particular years, quarters, months or periods refer to our fiscal years and the associated quarters, months and periods of those fiscal years.

Investor Relations Contact

Steven L. Marotta
941-500-1918
[email protected]

Media Relations Contact

Jenni Glester
407-864-5823
[email protected]

Non-GAAP Financial Measures
(Unaudited)

To supplement the consolidated financial statements, which are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”), we use the following non-GAAP measures, which present operating results on an adjusted basis: (i) Adjusted EBITDA, (ii) Adjusted EBITDA margin, (iii) Restaurant level operating profit and (iv) Restaurant level operating profit margin. Our presentation of these non-GAAP measures includes isolating the effects of some items that are either nonrecurring in nature or have no meaningful correlation to our ongoing core operating performance. These supplemental measures of performance are not required by or presented in accordance with GAAP. Management believes these non-GAAP measures provide investors with additional visibility into our operations, facilitate analysis and comparisons of our ongoing business operations because they exclude items that may not be indicative of our ongoing operating performance, help to identify operational trends and allow for greater transparency with respect to key metrics used by Management in our financial and operational decision making. Our non-GAAP measures may not be comparable to similarly titled measures used by other companies and have important limitations as analytical tools. These non-GAAP measures should not be considered in isolation or as substitutes for analysis of our results as reported under GAAP as they may not provide a complete understanding of our performance. These non-GAAP measures should be reviewed in conjunction with our consolidated financial statements prepared in accordance with GAAP.

Adjusted EBITDA and Adjusted EBITDA Margin

Management uses Adjusted EBITDA and Adjusted EBITDA margin (i) as factors in evaluating management’s performance when determining incentive compensation, (ii) to evaluate the Company’s operating results and the effectiveness of our business strategies and (iii) internally as benchmarks to compare the Company’s performance to that of its competitors.

Non-GAAP Financial Measures Reconciliations

Adjusted EBITDA and Adjusted EBITDA margin – The following table reconciles Net income (loss) and Net income (loss) margin, the most directly comparable GAAP measures to Adjusted EBITDA and Adjusted EBITDA margin for the periods indicated:

THIRTEEN WEEKS ENDED

(in thousands) MARCH 30, 2025 MARCH 31, 2024

Net (loss) income $ (829 ) $ 7,214

Depreciation and amortization 16,557 12,271

Interest expense 3,334 2,599

Income tax (benefit) expense (708 ) 2,799

EBITDA 18,354 24,883

Strategic costs ⁽¹⁾ 1,234 235

Loss on extinguishment and modification of debt — 428

Stock-based compensation ⁽²⁾ 2,259 1,866

Delaware Voluntary Disclosure Agreement Program ⁽³⁾ 24 8

Transaction expenses, net ⁽⁴⁾ 873 669

Impairments and loss on disposal of assets ⁽⁵⁾ 9 119

Recruiting and relocation costs ⁽⁶⁾ — 204

Severance costs ⁽⁷⁾ — 178

Adjusted EBITDA $ 22,753 $ 28,590

Total revenues $ 282,240 $ 242,449

Net (loss) income margin (0.3) % 3.0 %

Adjusted EBITDA margin 8.1 % 11.8 %

Additional information

Deferred rent expense ⁽⁸⁾ $ 185 $ 343

___________________________
(1) Represents costs related to process improvements and strategic initiatives. These costs are recorded within General and administrative expenses on the Consolidated Statements of Operations and Comprehensive Income (Loss).
(2) Represents non-cash, stock-based compensation expense which is recorded within General and administrative expenses on the Consolidated Statements of Operations and Comprehensive Income (Loss).
(3) Represents professional service costs incurred in connection with the Delaware Voluntary Disclosure Agreement Program related to unclaimed or abandoned property. These costs are recorded in General and administrative expenses on the Consolidated Statements of Operations and Comprehensive Income (Loss).
(4) Represents costs incurred in connection with the acquisition of franchise-owned restaurants, secondary offering costs and, in 2024, an offsetting gain on release of contingent consideration liability and expenses related to debt.
(5) Represents costs related to the disposal of assets due to retirements, replacements or certain restaurant closures. There were no impairments recognized during the periods presented.
(6) Represents costs incurred for hiring qualified individuals. These costs are recorded within General and administrative expenses on the Consolidated Statements of Operations and Comprehensive Income (Loss).
(7) Severance costs are recorded in General and administrative expenses on the Consolidated Statements of Operations and Comprehensive Income (Loss).
(8) Represents the non-cash portion of straight-line rent expense recorded within both Occupancy expenses and General and administrative expenses on the Consolidated Statements of Operations and Comprehensive Income (Loss).

Restaurant level operating profit and Restaurant level operating profit margin

Restaurant level operating profit and Restaurant level operating profit margin are not indicative of our overall results, and because they exclude corporate-level expenses, do not accrue directly to the benefit of our stockholders. We will continue to incur such expenses in the future. Restaurant level operating profit and Restaurant level operating profit margin are important measures we use to evaluate the performance and profitability of each operating restaurant, individually and in the aggregate and to make decisions regarding future spending and other operational decisions. We believe that Restaurant level operating profit and Restaurant level operating profit margin provide useful information about our operating results, identify operational trends and allow for transparency with respect to key metrics used by us in our financial and operational decision-making.

The following tables reconcile Income from operations and Income from operations margin, the most directly comparable GAAP financial measures, to Restaurant level operating profit and Restaurant level operating profit margin for the periods indicated:

THIRTEEN WEEKS ENDED

(in thousands) MARCH 30, 2025 MARCH 31, 2024

Income from operations $ 1,113 $ 12,286

Less: Franchise revenues (2,649 ) (3,141 )

Add:

General and administrative expenses 30,219 27,658

Depreciation and amortization 16,557 12,271

Transaction expenses, net ⁽¹⁾ 873 669

Impairments and loss on disposal of assets ⁽²⁾ 9 119

Restaurant level operating profit $ 46,122 $ 49,862

Restaurant sales $ 279,591 $ 239,308

Income from operations margin 0.4 % 5.1 %

Restaurant level operating profit margin 16.5 % 20.8 %

Additional information

Deferred rent expense ⁽³⁾ $ 135 $ 293

____________________________
(1) Represents costs incurred in connection with the acquisition of franchise-owned restaurants, secondary offering costs and, in 2024, an offsetting gain on release of contingent consideration liability and expenses related to debt.
(2) Represents costs related to the disposal of assets due to retirements, replacements or certain restaurant closures. There were no impairments recognized during the periods presented.
(3) Represents the non-cash portion of straight-line rent expense recorded within Occupancy expenses on the Consolidated Statements of Operations and Comprehensive Income (Loss).

FIRST WATCH RESTAURANT GROUP, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

(Unaudited)

THIRTEEN WEEKS ENDED

MARCH 30, 2025 MARCH 31, 2024

Revenues:

Restaurant sales $ 279,591 $ 239,308

Franchise revenues 2,649 3,141

Total revenues 282,240 242,449

Operating costs and expenses:

Restaurant operating expenses (exclusive of depreciation and amortization shown below):

Food and beverage costs 66,647 52,184

Labor and other related expenses 96,754 79,735

Other restaurant operating expenses 44,259 36,792

Occupancy expenses 23,149 19,168

Pre-opening expenses 2,660 1,567

General and administrative expenses 30,219 27,658

Depreciation and amortization 16,557 12,271

Impairments and loss on disposal of assets 9 119

Transaction expenses, net 873 669

Total operating costs and expenses 281,127 230,163

Income from operations 1,113 12,286

Interest expense (3,334 ) (2,599 )

Other income, net 684 326

(Loss) income before income taxes (1,537 ) 10,013

Income tax benefit (expense) 708 (2,799 )

Net (loss) income $ (829 ) $ 7,214

Net (loss) income $ (829 ) $ 7,214

Other comprehensive (loss) income:

Unrealized (loss) gain on derivatives (883 ) 1,238

Income tax related to other comprehensive (loss) income 220 (309 )

Comprehensive (loss) income $ (1,492 ) $ 8,143

Net (loss) income per common share – basic $ (0.01 ) $ 0.12

Net (loss) income per common share – diluted $ (0.01 ) $ 0.12

Weighted average number of common shares outstanding – basic 60,767,401 60,012,790

Weighted average number of common shares outstanding – diluted 60,767,401 62,476,379

Posted on May 6, 2025 7:12 am
TScan Therapeutics Reports First Quarter 2025 Financial Results and Provides Corporate Update

Updates from the PLEXI-T™ solid tumor and ALLOHA™ heme Phase 1 clinical trials anticipated by end of year

On-track to file IND application for TSC-102-A0301 (CD45; HLA-A*03:01) to FDA in the second half of the year

Appointed commercial leader Stephen Camiolo as Senior Vice President, Market Access

Cash, cash equivalents, and marketable securities continue to fund operations into the first quarter of 2027

WALTHAM, Mass., May 06, 2025 (GLOBE NEWSWIRE) — TScan Therapeutics, Inc. (Nasdaq: TCRX), a clinical-stage biotechnology company focused on the development of T cell receptor (TCR)-engineered T cell (TCR-T) therapies for the treatment of patients with cancer, today reported financial results for the three months ended March 31, 2025, and provided a corporate update.

“This is an exciting year for TScan as we advance our mission of bringing life-changing T-cell therapies to patients with both heme and solid tumor malignancies,” said Gavin MacBeath, Ph.D., Chief Executive Officer. “In the first quarter, we continued to enroll into singleplex dose levels in our PLEXI-T solid tumor trial. We look forward to dosing our first patient with multiplex therapy soon, and to sharing safety and efficacy data later this year. With respect to our heme program, we remain on track to initiate a registrational trial of TSC-101 in the latter half of the year. We continue to investigate TSC-101 in patients with AML, ALL, and MDS and plan to provide an update on the ALLOHA Phase 1 study, including two-year follow-up on initial patients, by year-end.”

Recent Corporate Highlights

The Company recently announced an upcoming poster presentation: “CD45 as a Universal Target for Adjuvant TCR-T Cell Therapy Following Allogeneic Hematopoietic Cell Transplantation” at the American Society of Gene and Cell Therapy (ASGCT) 28^th Annual Meeting, being held May 13-17 in New Orleans. Details on the presentation can be found here.

In March, the Company appointed Stephen Camiolo as Senior Vice President, Market Access. Mr. Camiolo brings to TScan over 25 years of experience in market access, reimbursement, pricing strategy, sales, marketing, and account management across the pharmaceutical and biotechnology industries.

The Company will participate in a fireside chat at the upcoming Bank of America 2025 Health Care Conference being held in Las Vegas, NV on Tuesday, May 13, 2025 at 3:40 p.m. Pacific Time. A webcast of the fireside chat will be available on the “Events and Presentations” section of the Company’s website at ir.tscan.com. An archived replay of the webcast will be available on the Company’s website following the event.

Upcoming Anticipated Milestones

Heme Malignancies Program: TScan’s lead TCR-T therapy candidate, TSC-101, is designed to treat residual disease and prevent relapse in patients with acute myeloid leukemia (AML), acute lymphoblastic leukemia (ALL), or myelodysplastic syndrome (MDS) undergoing allogeneic hematopoietic cell transplantation (HCT) (the ALLOHA trial,

NCT05473910

).

Plans to initiate a registrational trial for TSC-101, pending further feedback from regulatory authorities, in the second half of 2025.

Expects to file an investigational new drug (IND) application for TSC-102-A0301, a TCR-T targeting an HLA-A*03:01-restricted epitope on CD45, in the second half of 2025.

Plans to present additional data from the ALLOHA Phase 1 trial by the end of the year, including two-year relapse data on the initial patients.

Solid Tumor Program: TScan continues to develop the ImmunoBank, a collection of TCR-T therapy candidates that target different cancer-associated antigens presented on diverse HLA types. TScan’s strategy is to treat patients with multiple TCR-T therapy candidates to overcome tumor heterogeneity and resistance that may arise from either target or HLA loss (the PLEXI-T trial,

NCT05973487

).

On track to dose first patient with multiplex TCR-T therapy in the first half of 2025.

Safety and response data for multiplex TCR-T therapy anticipated by the end of the year.

First Quarter 2025 Financial Results

Revenue: Revenue for the first quarter of 2025 was $2.2 million, compared to $0.6 million for the first quarter of 2024. The increase was primarily due to timing of research activities pursuant to the Company’s collaboration agreement with Amgen.

R&D Expenses: Research and development (R&D) expenses for the first quarter of 2025 were $29.8 million, compared to $24.9 million for the first quarter of 2024. The increase of $4.9 million was primarily driven by an increase in laboratory supplies, research materials and studies expense due to start-up activities with a CDMO, as well as an increase in facility-related and personnel expenses associated with continued expansion of manufacturing capabilities. R&D expenses included non-cash stock compensation expense of $1.7 million and $1.1 million for the first quarter of 2025 and 2024, respectively.

G&A Expenses: General and administrative (G&A) expenses for the first quarter of 2025 were $8.6 million, compared to $7.1 million for the first quarter of 2024. The increase of $1.5 million was primarily driven by an increase in personnel expenses due to increased headcount to support business activities. G&A expenses included non-cash stock compensation expense of $1.7 million and $0.9 million for the first quarter of 2025 and 2024, respectively.

Net Loss: Net loss was $34.1 million for the first quarter of 2025, compared to $30.1 million for the first quarter of 2024, and included net interest income of $2.1 million and $1.2 million, respectively.

Cash Position: Cash, cash equivalents, and marketable securities as of March 31, 2025, were $251.7 million, excluding $5.0 million of restricted cash. The Company believes that its existing cash resources will be sufficient to fund its current operating plan into the first quarter of 2027.

Share Count: As of March 31, 2025, the Company had 56,590,627 shares of common stock outstanding, consisting of 52,314,039 shares of voting common stock and 4,276,588 shares of non-voting common stock. In addition, the Company had 73,087,945 of pre-funded warrants outstanding to purchase shares of voting common stock at an exercise price of $0.0001 per share. Pro forma outstanding shares as of March 31, 2025, inclusive of both common stock and pre-funded warrants, were 129,678,572.

About TScan Therapeutics, Inc.

TScan is a clinical-stage biotechnology company focused on the development of T cell receptor (TCR)-engineered T cell (TCR-T) therapies for the treatment of patients with cancer. The Company’s lead TCR-T therapy candidates are in development for the treatment of patients with hematologic malignancies to prevent relapse following allogeneic hematopoietic cell transplantation (the ALLOHA^™ Phase 1 heme trial). The Company has developed and continues to expand its ImmunoBank, the Company’s repository of therapeutic TCRs that recognize diverse targets and are associated with multiple HLA types, to provide customized multiplex TCR-T therapies for patients with a variety of cancers (the PLEXI-T^™ Phase 1 solid tumor trial). The Company is currently enrolling patients into both clinical programs.

Forward-Looking Statements

This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, but not limited to, express or implied statements regarding the Company’s plans, progress, expectations, and timing relating to the Company’s hematologic malignancies program, including clinical updates of the ALLOHA Phase 1 heme trial, presentation of data, opening of expansion cohorts, filing of an IND for TSC-102-A0301, and initiation of registrational trials; the Company’s plans, progress, expectations and timing relating to the Company’s solid tumor program, including clinical updates of the PLEXI-T Phase 1 solid tumor trial, enrolling and dosing singleplex and multiplex patients, and presentation of data; the progress of the hematologic malignancies and solid tumor programs being indicative or predictive of the success of each program; the Company’s current and future research and development plans or expectations; the structure, timing and success of the Company’s planned preclinical development, submission of INDs, and clinical trials; the potential benefits of any of the Company’s proprietary platforms, multiplexing, or current or future product candidates in treating patients; the Company’s ability to fund its operating plan into the first quarter of 2027 with its existing cash, cash equivalents, and marketable securities; and the Company’s goals, strategy and anticipated financial performance. TScan intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by terms such as, but not limited to, “may,” “might,” “will,” “objective,” “intend,” “should,” “could,” “can,” “would,” “expect,” “believe,” “anticipate,” “project,” “target,” “design,” “estimate,” “predict,” “potential,” “plan,” “on track,” or similar expressions or the negative of those terms. Such forward-looking statements are based upon current expectations that involve risks, changes in circumstances, assumptions, and uncertainties. The express or implied forward-looking statements included in this release are only predictions and are subject to a number of risks, uncertainties and assumptions, including, without limitation: the beneficial characteristics, safety, efficacy, therapeutic effects and potential advantages of TScan’s TCR-T therapy product candidates; TScan’s expectations regarding its preclinical studies being predictive of clinical trial results; TScan’s approved INDs being indicative or predictive of bringing TScan closer to its goal of providing customized TCR-T therapies to treat patients with cancer; the timing of the launch, initiation, progress, expected results and announcements of TScan’s preclinical studies, clinical trials and its research and development programs; TScan’s ability to enroll patients for its clinical trials within its expected timeline; TScan’s plans relating to developing and commercializing its TCR-T therapy product candidates, if approved, including sales strategy; estimates of the size of the addressable market for TScan’s TCR-T therapy product candidates; TScan’s manufacturing capabilities and the scalable nature of its manufacturing process; TScan’s estimates regarding expenses, future milestone payments and revenue, capital requirements and needs for additional financing; TScan’s expectations regarding competition; TScan’s anticipated growth strategies; TScan’s ability to attract or retain key personnel; TScan’s ability to establish and maintain development partnerships and collaborations; TScan’s expectations regarding federal, state and foreign regulatory requirements; TScan’s ability to obtain and maintain intellectual property protection for its proprietary platform technology and our product candidates; the sufficiency of TScan’s existing capital resources to fund its future operating expenses and capital expenditure requirements; and other factors that are described in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of TScan’s most recent Annual Report on Form 10-K and any other filings that TScan has made or may make with the SEC in the future. Any forward-looking statements contained in this release represent TScan’s views only as of the date hereof and should not be relied upon as representing its views as of any subsequent date. Except as required by law, TScan explicitly disclaims any obligation to update any forward-looking statements.

Contacts

Heather Savelle
TScan Therapeutics, Inc.
VP, Investor Relations
857-399-9840
[email protected]

Maghan Meyers
Argot Partners
212-600-1902
[email protected]

TScan Therapeutics, Inc.

Condensed Consolidated Balance Sheet Data

(unaudited, in thousands, except share amount)

March 31,
2025 December 31,
2024

Assets

Cash and cash equivalents $ 154,108 $ 178,689

Other assets 178,601 192,429

Total assets $ 332,709 $ 371,118

Liabilities and Stockholders’ Equity

Total liabilities $ 122,507 $ 130,148

Total stockholders’ equity 210,202 240,970

Total liabilities and stockholders’ deficit $ 332,709 $ 371,118

Common stock and pre-funded warrants outstanding⁽¹⁾ 129,678,572 129,678,572

⁽¹⁾ Includes at March 31, 2025 and December 31, 2024, 73,087,945 issued and outstanding pre-funded warrants to purchase shares of voting common stock at an exercise price of $0.0001 per share.

TScan Therapeutics, Inc.

Condensed Consolidated Statements of Operations

(unaudited, in thousands, except share and per share amounts)

Three Months Ended

March 31,

2025 2024

Revenue:

Collaboration and license revenue $ 2,171 $ 566

Operating expenses:

Research and development 29,788 24,857

General and administrative 8,633 7,082

Total operating expenses 38,421 31,939

Loss from operations (36,250 ) (31,373 )

Interest and other income, net 2,802 2,190

Interest expense (679 ) (959 )

Net loss $ (34,127 ) $ (30,142 )

Net loss per share, basic and diluted $ (0.26 ) $ (0.32 )

Weighted average common shares outstanding—basic and diluted ⁽²⁾ 129,678,572 94,875,893

⁽²⁾ For the three months ended March 31, 2025 and 2024, 73,087,945 and 47,010,526 shares of the Company’s voting common stock issuable upon exercise of pre-funded warrants are included as outstanding common stock in the calculation of basic and diluted net loss per share.

Posted on May 6, 2025 7:11 am
UL Solutions Inc. Reports Strong First Quarter 2025 Results

UL Solutions Inc. Reports Strong First Quarter 2025 Results

First Quarter 2025 (Comparisons to First Quarter 2024^{unless otherwise noted)¹}

Strong revenue growth of 5.2% to $705 million, including 7.6% organic growth

Net income of $71 million increased 18.3%, Net income margin of 10.1%, expanded 110 basis points

Diluted earnings per share of $0.33 increased 17.9%, Adjusted Diluted Earnings Per Share of $0.37 increased 32.1%

Adjusted EBITDA of $161 million increased 22.9%, Adjusted EBITDA margin of 22.8% expanded 320 basis points

NORTHBROOK, Ill.–(BUSINESS WIRE)–
UL Solutions Inc. (NYSE: ULS), a global safety science leader in independent third-party testing, inspection and certification services and related software and advisory offerings, today reported results for the first quarter ended March 31, 2025.

“As we completed our first full year as a public company, I’m encouraged by the strong execution and outstanding results our team continued to deliver, with momentum once again across all segments, service offerings and regions,” said President and CEO Jennifer Scanlon. “Strong organic growth, improved profitability and increased cash flow generation reflect our strategic focus on high-growth markets and ongoing operational excellence. Our global laboratory additions and expansions directly address evolving customer needs while strengthening our market leadership position across key industries.”

Scanlon continued, “In today’s environment of heightened global uncertainty, our work is never done. Customers continue to rely on UL Solutions as an essential strategic partner to navigate complex regulatory landscapes and bring products to market safely and efficiently. The investments we’re making help position us at the forefront of global megatrends shaping our industry’s future.”

“Our strong first quarter results included 7.6% organic revenue growth, 22.9% Adjusted EBITDA improvement, and Adjusted EBITDA margin expansion of 320 basis points, all while maintaining our strong liquidity and investment grade balance sheet,” said CFO Ryan Robinson. “The solid start to 2025 reinforces our guidance for mid-single digit constant currency organic revenue growth with full-year Adjusted EBITDA margin organic improvement. Our disciplined capital allocation strategy enables us to pursue strategic growth opportunities aligned with global megatrends while generating significant cash flow—creating a foundation for sustainable long-term value creation.”

First Quarter 2025 Financial Results

Revenue of $705 million compared to $670 million in the first quarter of 2024, an increase of 5.2%. Organic growth of 7.6% across all segments, led by the Industrial and Consumer segments.

Net income of $71 million compared to $60 million in the first quarter of 2024, an increase of 18.3%. Net income margin of 10.1% compared to 9.0% in the first quarter of 2024, an increase of 110 basis points. The margin expansion resulted from higher revenue and operating leverage, partially offset by increased income tax expense driven by continued implementation of the Organisation for Economic Co-operation and Development’s Pillar Two rules.

Adjusted Net Income of $80 million compared to $61 million in the first quarter of 2024, an increase of 31.1%. Adjusted Net Income margin of 11.3% compared to 9.1% in the first quarter of 2024, an increase of 220 basis points.

Diluted earnings per share of $0.33 compared to $0.28 in the first quarter of 2024, an increase of $0.05. Adjusted Diluted Earnings Per Share of $0.37 compared to $0.28 in the first quarter of 2024, an increase of $0.09.

Adjusted EBITDA of $161 million compared to $131 million in the first quarter of 2024, an increase of 22.9%. Adjusted EBITDA margin of 22.8% compared to 19.6% in the first quarter of 2024, an increase of 320 basis points. The margin expansion resulted from higher revenue and operating leverage, led by the Industrial and Consumer segments.

¹This press release includes references to non-GAAP financial measures. Please refer to “Non-GAAP Financial Measures” later in this release for the definitions of each non-GAAP financial measure presented, as well as reconciliations of these measures to their most directly comparable GAAP measures.

First Quarter 2025 Segment Performance

Industrial Segment Results

Industrial revenue of $308 million compared to $295 million in the first quarter of 2024, an increase of 4.4%, or 8.1% on an organic basis. Operating income of $83 million compared to $75 million in the first quarter of 2024. Operating income margin of 26.9% compared to 25.4% in the first quarter of 2024. Adjusted EBITDA of $100 million compared to $86 million in the first quarter of 2024, an increase of 16.3%. Adjusted EBITDA margin of 32.5% compared to 29.2% in the first quarter of 2024. Revenue gains were driven by price increases, continued demand related to electrical products and component certification testing and services and increased laboratory capacity. Adjusted EBITDA gains and margin improvement were driven primarily by higher revenue and operating leverage.

Consumer Segment Results

Consumer revenue of $304 million compared to $286 million in the first quarter of 2024, an increase of 6.3%, or 7.7% on an organic basis. Operating income of $26 million compared to $17 million in the first quarter of 2024. Operating income margin of 8.6% compared to 5.9% in the first quarter of 2024. Adjusted EBITDA of $48 million compared to $35 million in the first quarter of 2024, an increase of 37.1%. Adjusted EBITDA margin of 15.8% compared to 12.2% in the first quarter of 2024. Revenue gains were driven by consumer technology and retail. Adjusted EBITDA gains and margin improvement were driven primarily by higher revenue and operational efficiency.

Software and Advisory Segment Results

Software and Advisory revenue of $93 million compared to $89 million in the first quarter of 2024, an increase of 4.5% or 5.6% on an organic basis. Operating loss of $0 compared to $1 million in the first quarter of 2024. Operating loss margin of 0.0% compared to 1.1% in first quarter of 2024. Adjusted EBITDA of $13 million compared to $10 million in the first quarter of 2024, an increase of 30.0%. Adjusted EBITDA margin of 14.0% compared to 11.2% in the first quarter of 2024. Revenue gains were driven by demand for software. Adjusted EBITDA gains and margin improvement were driven primarily by higher revenue and operating leverage.

Liquidity and Capital Resources

For the first three months of 2025, the Company generated $154 million of net cash provided by operating activities, an increase from $141 million for the same period in 2024. Net cash provided by operating activities in the first quarter was impacted by higher net income due to business performance.

The Company continues to make strategic capital investments to meet increased demand and drive greater productivity. Capital expenditures were $51 million, a decrease from $57 million for the same period in 2024. Free Cash Flow for the first three months was $103 million, compared to $84 million for the same period in 2024.

The Company paid a dividend of $0.13 per share, or $26 million, during the three months ended March 31, 2025.

As of March 31, 2025, total debt was $657 million, prior to unamortized debt issuance costs, a decrease from December 31, 2024 due to $90 million of net repayments on the Company’s term loan and revolving credit facility.

The Company ended the quarter with cash and cash-equivalents of $267 million compared to $298 million at December 31, 2024.

Full-Year 2025 Outlook

The Company is affirming its 2025 outlook:

Mid single digit constant currency organic revenue growth

Adjusted EBITDA margin organic improvement to approximately 24%

Capital expenditures expected to be 7% to 8% of revenue

Effective tax rate estimated to be approximately 26%

Continuing to pursue acquisitions and portfolio refinements

The Company’s 2025 outlook is based on a number of assumptions that are subject to change and many of which are outside the control of the Company. If actual results vary from these assumptions, the Company’s expectations may change. There can be no assurance that the Company will achieve the results expressed by this outlook. In addition, the increasingly uncertain and complex near-term macroeconomic and geopolitical environment presents both potential risks and opportunities for the Company. Like many other global businesses, the Company is carefully monitoring the potential impacts.

The Company does not provide guidance for net income margin, the most directly comparable GAAP measure to Adjusted EBITDA margin, and similarly cannot provide a reconciliation between its forecasted Adjusted EBITDA margin and net income margin without unreasonable effort due to the unavailability of reliable estimates for certain components of net income and the respective reconciliations. These forecasted items are not within the Company’s control, may vary greatly between periods and could significantly impact future financial results.

Conference Call and Webcast

UL Solutions will host a conference call today at 8:30 am ET to discuss the Company’s financial results. The live webcast of the conference call and accompanying presentation materials can be accessed through the UL Solutions Investor Relations website at ir.ul.com. For those unable to access the webcast, the conference call can be accessed by dialing 1-844-825-9789 (domestic) or 1-412-317-5180 (international). An archive of the webcast will be available on the Company’s website for 30 days.

About UL Solutions

A global leader in applied safety science, UL Solutions Inc. (NYSE: ULS) transforms safety, security and sustainability challenges into opportunities for customers in more than 110 countries. UL Solutions delivers testing, inspection and certification services, together with software products and advisory offerings, that support our customers’ product innovation and business growth. The UL Mark serves as a recognized symbol of trust in our customers’ products and reflects an unwavering commitment to advancing our safety mission. We help our customers innovate, launch new products and services, navigate global markets and complex supply chains, and grow sustainably and responsibly into the future. Our science is your advantage.

Investors and others should note that UL Solutions intends to routinely announce material information to investors and the marketplace using SEC filings, press releases, public conference calls, webcasts and the UL Solutions Investor Relations website. We also intend to use certain social media channels as a means of disclosing information about us and our products to consumers, our customers, investors and the public on our X account (@UL_Solutions) and our LinkedIn account (@ULSolutions). The information posted on social media channels is not incorporated by reference in this press release or in any other report or document we file with the SEC. While not all of the information that the Company posts to the UL Solutions Investor Relations website or to social media accounts is of a material nature, some information could be deemed to be material. Accordingly, the Company encourages investors, the media, and others interested in UL Solutions to review the information shared on our Investor Relations website at ir.ul.com and to regularly follow our social media accounts. Users can automatically receive email alerts and information about the Company by subscribing to “Investor Email Alerts” at the bottom of the UL Solutions Investor Relations website at ir.ul.com.

Forward-Looking Statements

This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts contained in this press release may be forward-looking statements. These include statements regarding management’s objectives for future operations and the Company’s plans, business strategy, outlook and future results of operations and financial position. In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “would,” “likely,” “expects,” “plans,” “anticipates,” “could,” “intends,” “targets,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential,” “continue” and variations of these terms and similar expressions, or the negative of these terms or similar expressions (although not all forward-looking statements may contain such words). The Company cautions you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements.

There are or will be important factors that could cause the Company’s actual results to differ materially from those expressed or implied by the forward-looking statements made in this press release, including, but not limited to, the following: any failure on the Company’s part to protect and maintain its brand and reputation, or the impact on its brand or reputation of third-party events or actions outside of its control; risks associated with the Company’s information technology and software, including those relating to any future data breach or other cybersecurity incident; the potential disruption of the TIC or S&A industries by technological advances in artificial intelligence; the Company’s ability to innovate, adapt to changing customer needs and successfully introduce new products and services in response to changes in the Company’s industries and technological advances; the Company’s ability to compete in its industries and the effects of increased competition from its competitors; risks associated with conducting business outside the United States, including those relating to fluctuations in foreign currency exchange rates; the imposition of tariffs and enhanced trade, import or export restrictions or changes in U.S. trade policy or similar government actions; and global, regional or political instability and geopolitical tensions; risks associated with the Company’s operations in China, which subject the Company and UL-CCIC Company Limited, the Company’s joint venture with the China Certification & Inspection (Group) Co., Ltd. (“CCIC”), to China’s complex and rapidly evolving laws, which may be interpreted, applied or enforced inconsistently or in ways inconsistent with its current operations, as well as risks associated with the fact that the Chinese government has the power to exercise significant oversight and discretion over, and intervene in and influence, its business operations in China; the relationship between the United States and China and between the Company and CCIC, as well as changes in U.S. and Chinese regulations affecting the Company’s business operations in China; any failure on the Company’s part to attract, hire or retain its key employees, including its senior leadership and its skilled and trained engineering, technical and professional personnel; the level of the Company’s customers’ satisfaction and any failure on its part to properly and timely perform its services, meet its contractual obligations or fulfil its customers’ needs; changes to the relevant regulatory frameworks or private sector requirements, including any requirement that the Company accept third-party test results or certifications of components, end products, processes or systems or any changes that result in a reduction in required inspections, tests or certifications or harmonized international or cross-industry benchmarks and standards; the Company’s ability to adequately maintain, protect and enhance its intellectual property, including its registered UL-in-a-circle certification mark and other certification marks; the Company’s ability to implement its growth strategies and initiatives successfully; the Company’s reliance on third parties, including subcontractors and outside laboratories; the Company’s ability to obtain and maintain the requisite licenses, approvals, accreditations and delegations of authority necessary to conduct its business; the outcomes of current and future legal proceedings; the Company’s level of indebtedness and future cash needs; failure to generate sufficient cash to service the Company’s indebtedness; a change in the assumptions the Company uses to value its goodwill or intangible assets, or the impairment of its goodwill or intangible assets; constraints imposed on the Company’s ability to operate its business or make necessary capital investments due to the Company’s outstanding indebtedness; the increased expenses and responsibilities associated with being a public company; the significant influence that ULSE Inc., our parent and controlling stockholder, has over the Company, including pursuant to its rights under the Company’s amended and restated certificate of incorporation and the Stockholder Agreement with ULSE Inc.; natural disasters and other catastrophic events, including pandemics and the rapid spread of contagious illnesses; changes in tax laws in jurisdictions in which we operate or adverse outcomes resulting from examination of our or our affiliates tax returns; and other factors discussed in our filings with the Securities and Exchange Commission (the “SEC”), including those set forth under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part I, Item 2 of the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2025 and under “Risk Factors” in Part I, Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, as well as other factors described from time to time in our filings with the SEC.

If one or more events related to these or other risks or uncertainties materialize, or if the Company’s underlying assumptions prove to be incorrect, actual results may differ materially from what the Company anticipates. Many of the important factors that will determine these results are beyond the Company’s ability to control or predict. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and, except as otherwise required by law, the Company does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. If the Company updates one or more forward-looking statements, no inference should be drawn that the Company will make additional updates with respect to those or other forward-looking statements. New factors emerge from time to time, and it is not possible for the Company to predict which will arise. In addition, the Company cannot assess the impact of each factor on the Company’s business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. All forward-looking statements attributable to the Company, or others acting on the Company’s behalf, are expressly qualified in their entirety by the cautionary statements above.

Non-GAAP Financial Measures

In addition to financial measures determined in accordance with accounting principles generally accepted in the United States of America (“GAAP”), this press release includes supplemental non-GAAP financial measures, including the presentation of Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income, Adjusted Net Income margin, Adjusted Diluted Earnings Per Share, Free Cash Flow and Free Cash Flow margin. Management uses non-GAAP financial measures in addition to GAAP measures to understand and compare operating results across periods and for forecasting and other purposes. Management believes these non-GAAP financial measures provide useful information to investors and reflect results in a manner that enables, in some instances, more meaningful analysis of trends and facilitates comparison of results across periods. These measures are not financial measures calculated in accordance with GAAP and should not be considered as a substitute for net income, operating income, diluted earnings per share, net cash provided by operating activities or any other measure calculated in accordance with GAAP, and may not be comparable to similarly titled measures reported by other companies due to potential differences between the companies in calculations.

The Company uses Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income, Adjusted Net Income margin and Adjusted Diluted Earnings Per Share to measure the operational strength and performance of its business and believes these measures provide additional information to investors about certain non-cash items and unusual items that the Company does not expect to continue at the same level in the future. Further, management believes these non-GAAP financial measures provide a meaningful measure of business performance. The Company uses Free Cash Flow and Free Cash Flow margin as additional liquidity measures and believes these measures provide useful information to investors about the cash generated from the Company’s core operations that may be available to repay debt, make other investments and return cash to stockholders.

There are material limitations to using these non-GAAP financial measures. Adjusted EBITDA does not take into account certain significant items, including depreciation and amortization, interest expense, other expense, net, income tax expense, stock-based compensation expense for equity-settled awards, material asset impairment charges and restructuring expenses which directly affect the Company’s net income, as applicable. Adjusted Net Income and Adjusted Diluted Earnings Per Share do not take into account certain significant items, including other expense, net, stock-based compensation expense for equity-settled awards, material asset impairment charges and restructuring expenses which directly affect the Company’s net income and diluted earnings per share, as applicable. Free Cash Flow and Free Cash Flow margin adjust for cash items that are ultimately within management’s discretion to direct and therefore may imply that there is less or more cash that is available than the most comparable GAAP measure. Free Cash Flow and Free Cash Flow margin are not intended to represent residual cash flow for discretionary expenditures since debt repayment requirements and other non-discretionary expenditures are not deducted. These limitations are best addressed by considering the economic effects of the excluded items independently, and by considering these non-GAAP financial measures in conjunction with net income, operating income, diluted earnings per share and net cash provided by operating activities as calculated in accordance with GAAP.

See additional information below for definitions of these non-GAAP financial measures, and reconciliations to their most directly comparable GAAP measures.

Source Code: ULS-IR

UL Solutions Inc.
Condensed Consolidated Statements of Operations
(Unaudited)

Three Months Ended

March 31,

(in millions, except per share data)

2025

2024

Revenue

$

705

$

670

Cost of revenue

364

351

Selling, general and administrative expenses

232

228

Operating income

109

91

Interest expense

(12

)

(15

)

Other expense, net

(3

)

(3

)

Income before income taxes

94

73

Income tax expense

23

13

Net income

71

60

Less: net income attributable to non-controlling interests

4

4

Net income attributable to stockholders of UL Solutions

$

67

$

56

Earnings per common share:

Basic

$

0.34

$

0.28

Diluted

$

0.33

$

0.28

Weighted average common shares outstanding:

Basic

200

200

Diluted

203

200

UL Solutions Inc.
Condensed Consolidated Balance Sheets
(Unaudited)

(in millions)

March 31,

2025

December 31,

2024

Assets

Current assets:

Cash and cash equivalents

$

267

$

298

Accounts receivable, net

463

380

Contract assets, net

203

182

Other current assets

65

61

Total current assets

998

921

Property, plant and equipment, net

631

631

Goodwill

641

633

Intangible assets, net

56

58

Operating lease right-of-use assets

182

186

Deferred income taxes

108

108

Capitalized software, net

123

127

Other assets

139

136

Total Assets

$

2,878

$

2,800

Liabilities and Stockholders’ Equity

Current liabilities:

Current portion of long-term debt

$

—

$

50

Accounts payable

143

182

Accrued compensation and benefits

164

254

Operating lease liabilities – current

40

38

Contract liabilities

400

162

Other current liabilities

57

54

Total current liabilities

804

740

Long-term debt

653

692

Pension and postretirement benefit plans

195

196

Operating lease liabilities

150

155

Other liabilities

92

86

Total Liabilities

1,894

1,869

Total Stockholders’ Equity

984

931

Total Liabilities and Stockholders’ Equity

$

2,878

$

2,800

UL Solutions Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)

Three Months Ended March 31,

(in millions)

2025

2024

Operating activities

Net cash flows provided by operating activities

$

154

$

141

Investing activities

Capital expenditures

(51

)

(57

)

Other investing activities, net

1

—

Net cash flows used in investing activities

(50

)

(57

)

Financing activities

Repayments of long-term debt, net

(90

)

(25

)

Dividends to stockholders of UL Solutions

(26

)

(25

)

Dividends to non-controlling interest

(17

)

—

Other financing activities, net

(2

)

1

Net cash flows used in financing activities

(135

)

(49

)

Effect of exchange rate changes on cash and cash equivalents

—

(6

)

Net (decrease) increase in cash and cash equivalents

(31

)

29

Cash and cash equivalents

Beginning of period

298

315

End of period

$

267

$

344

UL Solutions Inc.

Supplemental Financial Information

Revenue by Major Service Category and Revenue Growth Components

(Unaudited)

Revenue by Major Service Category

Three Months Ended

March 31,

(in millions)

2025

2024

Certification Testing

$

189

$

176

Ongoing Certification Services

245

233

Non-certification Testing and Other Services

203

194

Software

68

67

Total

$

705

$

670

Revenue Change Components

Three Months Ended March 31, 2025

(in millions)

Organic¹

Acquisition /

Divestiture²

FX³

Total

Organic %

Change

Total %

Change

Revenue change

Industrial

$

24

$

(7

)

$

(4

)

$

13

8.1

%

4.4

%

Consumer

22

—

(4

)

18

7.7

%

6.3

%

Software and Advisory

5

—

(1

)

4

5.6

%

4.5

%

Total

$

51

$

(7

)

$

(9

)

$

35

7.6

%

5.2

%

Organic reflects revenue change in a given period excluding Acquisition / Divestiture and FX in that same period, expressed in dollars or as a percentage of revenue in the prior period.

Acquisition / Divestiture is calculated as revenue change in a given period related to acquisitions or disposals of businesses using prior period exchange rates, expressed in dollars or as a percentage of revenue in the prior period. Revenues from an acquisition or disposal are measured as Acquisition / Divestiture for the initial twelve month period following the acquisition or disposal date. Subsequently, the revenue impact from the acquired or disposed business is measured as Organic.

FX reflects the impact that foreign currency exchange rates have on revenue in a given period, expressed in dollars or as a percentage of revenue in the prior period. The Company uses constant currency to calculate the FX impact on revenue in a given period by translating current period revenues at prior period exchange rates, expressed as a percentage of revenue in the prior period.

UL Solutions Inc.

Supplemental Financial Information

Non-GAAP Measures

(Unaudited)

The table below reconciles net income to Adjusted EBITDA.

Three Months Ended March 31,

(in millions, unless otherwise stated)

2025

2024

Net income

$

71

$

60

Depreciation and amortization expense

45

41

Interest expense

12

15

Other expense, net

3

3

Income tax expense

23

13

Stock-based compensation

8

—

Restructuring

(1

)

(1

)

Adjusted EBITDA¹

$

161

$

131

Revenue

$

705

$

670

Net income margin

10.1

%

9.0

%

Adjusted EBITDA margin²

22.8

%

19.6

%

The Company defines Adjusted EBITDA as net income adjusted for depreciation and amortization expense, interest expense, other expense, net, income tax expense, as well as stock-based compensation expense for equity-settled awards, material asset impairment charges and restructuring expenses, as applicable. The Company believes that the presentation of Adjusted EBITDA provides additional information to investors about certain non-cash items and unusual items that are not expected to continue at the same level in the future. Further, the Company believes Adjusted EBITDA provides a meaningful measure of business performance and provides a basis for comparing its performance to that of other peer companies using similar measures. There are material limitations to using Adjusted EBITDA. Adjusted EBITDA does not take into account certain significant items, including depreciation and amortization, interest expense, other expense, net, income tax expense, stock-based compensation expense for equity-settled awards, material asset impairment charges and restructuring expenses which directly affect the Company’s net income, as applicable. These limitations are best addressed by considering the economic effects of the excluded items independently, and by considering Adjusted EBITDA in conjunction with net income as calculated in accordance with GAAP.

Adjusted EBITDA margin is calculated as Adjusted EBITDA as a percentage of revenue.

The table below reconciles segment operating income to segment Adjusted EBITDA.

Three Months Ended March 31,

(in millions, unless otherwise stated)

2025

2024

Industrial

Segment operating income

$

83

$

75

Depreciation and amortization expense

14

11

Stock-based compensation

3

—

Adjusted EBITDA¹

$

100

$

86

Revenue

$

308

$

295

Operating income margin

26.9

%

25.4

%

Adjusted EBITDA margin²

32.5

%

29.2

%

Consumer

Segment operating income

$

26

$

17

Depreciation and amortization expense

19

19

Stock-based compensation

4

—

Restructuring

(1

)

(1

)

Adjusted EBITDA¹

$

48

$

35

Revenue

$

304

$

286

Operating income margin

8.6

%

5.9

%

Adjusted EBITDA margin²

15.8

%

12.2

%

Software and Advisory

Segment operating loss

$

—

$

(1

)

Depreciation and amortization expense

12

11

Stock-based compensation

1

—

Adjusted EBITDA¹

$

13

$

10

Revenue

$

93

$

89

Operating loss margin

—

%

(1.1

)%

Adjusted EBITDA margin²

14.0

%

11.2

%

Adjusted EBITDA¹

$

161

$

131

See definition on previous page.

See definition on previous page.

The table below reconciles net income to Adjusted Net Income.

Three Months Ended March 31,

(in millions, unless otherwise stated)

2025

2024

Net income

$

71

$

60

Other expense, net

3

3

Stock-based compensation

8

—

Restructuring

(1

)

(1

)

Tax effect of adjustments³

(1

)

(1

)

Adjusted Net Income¹

$

80

$

61

Revenue

$

705

$

670

Net income margin

10.1

%

9.0

%

Adjusted Net Income margin²

11.3

%

9.1

%

The Company defines Adjusted Net Income as net income adjusted for other expense, net, stock-based compensation expense for equity-settled awards, material asset impairment charges and restructuring expenses, as applicable, each net of tax. The Company believes that the presentation of Adjusted Net Income provides additional information to investors about certain non-cash items and unusual items that are expected to continue at the same level in the future. Further, the Company believes Adjusted Net Income provides a meaningful measure of business performance and provides a basis for comparing its performance to that of other peer companies using similar measures. There are material limitations to using Adjusted Net Income. Adjusted Net Income does not take into account certain significant items, including other expense, net, stock-based compensation expense for equity-settled awards, material asset impairment charges and restructuring expenses which directly affect the Company’s net income, as applicable. These limitations are best addressed by considering the economic effects of the excluded items independently, and by considering Adjusted Net Income in conjunction with net income as calculated in accordance with GAAP.

Adjusted Net Income margin is calculated as Adjusted Net Income as a percentage of revenue.

The Company computed the tax effect of adjustments to net earnings by applying the statutory tax rate in the relevant jurisdictions to the taxable income or expense items that are adjusted in the period presented. If a valuation allowance exists, the rate applied is zero.

The table below reconciles diluted earnings per share to Adjusted Diluted Earnings Per Share.

Three Months Ended March 31,

2025

2024

Diluted earnings per share

$

0.33

$

0.28

Other expense, net

0.02

0.02

Stock-based compensation

0.04

—

Restructuring

(0.01

)

(0.01

)

Tax effect of adjustments²

(0.01

)

(0.01

)

Adjusted Diluted Earnings Per Share¹

$

0.37

$

0.28

The Company defines Adjusted Diluted Earnings Per Share as diluted earnings per share attributable to stockholders of UL Solutions adjusted for other expense, net, stock-based compensation expense for equity-settled awards, material asset impairment charges and restructuring expenses, as applicable. The Company believes that the presentation of Adjusted Diluted Earnings Per Share provides additional information to investors about certain non-cash items and unusual items that are expected to continue at the same level in the future. Further, the Company believes Adjusted Diluted Earnings Per Share provides a meaningful measure of business performance and provides a basis for comparing its performance to that of other peer companies using similar measures. There are material limitations to using Adjusted Diluted Earnings Per Share. Adjusted Diluted Earnings Per Share does not take into account certain significant items, including other expense, net, stock-based compensation expense for equity-settled awards, material asset impairment charges and restructuring expenses which directly affect the Company’s diluted earnings per share, as applicable. These limitations are best addressed by considering the economic effects of the excluded items independently, and by considering Adjusted Diluted Earnings Per Share in conjunction with diluted earnings per share as calculated in accordance with GAAP.

See definition on previous page.

The table below reconciles net cash provided by operating activities to Free Cash Flow.

Three Months Ended March 31,

(in millions)

2025

2024

Net cash provided by operating activities

$

154

$

141

Capital expenditures

(51

)

(57

)

Free Cash Flow¹

$

103

$

84

Revenue

$

705

$

670

Net cash provided by operating activities margin

21.8

%

21.0

%

Free Cash Flow margin²

14.6

%

12.5

%

The Company defines Free Cash Flow as cash from operating activities less cash outlays related to capital expenditures. The Company defines capital expenditures to include purchases of property, plant and equipment and capitalized software. These items are subtracted from cash from operating activities because they represent long-term investments that are required for normal business activities. The Company uses Free Cash Flow as an additional liquidity measure and believes it provides useful information to investors about the cash generated from its core operations that may be available to repay debt, make other investments and return cash to stockholders. There are material limitations to using Free Cash Flow. Free Cash Flow adjusts for cash items that are ultimately within management’s discretion to direct, and therefore, may imply that there is less or more cash that is available than the most comparable GAAP measure. Free Cash Flow is not intended to represent residual cash flow for discretionary expenditures since debt repayment requirements and other non-discretionary expenditures are not deducted. These limitations are best addressed by considering the economic effects of the excluded items independently, and by considering Free Cash Flow in conjunction with net cash provided by operating activities as calculated in accordance with GAAP.

Free Cash Flow margin is calculated as Free Cash Flow as a percentage of revenue.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250506922517/en/

Media:

Kathy Fieweger

Senior Vice President – Communications

[email protected]

+1 312-852-5156

Investors:

Dan Scott / Rodny Nacier, ICR Inc.

[email protected]

KEYWORDS: United States North America Illinois

INDUSTRY KEYWORDS: Science Software Other Science Research Data Management Technology Apps/Applications Other Technology

MEDIA:

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Posted on May 6, 2025 7:11 am
EVgo Inc. Reports Record First Quarter 2025 Results

EVgo Inc. Reports Record First Quarter 2025 Results

Record revenue of $75.3 million in the first quarter, representing an increase of 36% year-over-year.

Charging network revenue totaled a record $47.1 million in the first quarter, an increase of 49% year-over-year, representing the 13^th consecutive quarter of double-digit year-over-year charging revenue growth.

Network throughput reached 83 gigawatt-hours (“GWh”) in the first quarter, an increase of 60% year-over-year.

Added more than 180 new operational stalls during the first quarter.

Ended the first quarter with 4,240 stalls in operation.

LOS ANGELES–(BUSINESS WIRE)–
EVgo Inc. (Nasdaq: EVGO) (“EVgo” or the “Company”) today announced results for the first quarter ended March 31, 2025. Management will host a webcast today at 8 a.m. ET / 5 a.m. PT to discuss EVgo’s results and other business highlights.

“EVgo once again achieved a record level of revenues, starting 2025 off on a strong foundation,” said Badar Khan, EVgo’s CEO. “We continue to deploy critical fast charging infrastructure across the U.S. and believe our strong balance sheet and owner-operator model position us well to meet the growing demand. We anticipate being minimally impacted by tariffs, and we remain focused on achieving Adjusted EBITDA breakeven in 2025, while investing in growth, including our next generation charging experience.”

Business Highlights

Co-Development Agreement for Next Generation Charging Architecture: EVgo and Delta Electronics signed a joint development agreement in January 2025 to co-develop EVgo’s next generation of chargers to improve customer experience, enhance charger reliability, and drive cost efficiencies with advanced firmware and hardware design with EVgo owning the intellectual property arising out of the design.

J3400 (NACS) Connectors: First pilot site with native NACS connectors became operational in February 2025. Additional locations anticipated to be added throughout 2025.

Stall Development: The Company ended the first quarter with 4,240 stalls in operation. EVgo added more than 180 new DC fast charging stalls during the quarter.

Average Daily Network Throughput: Average daily throughput per stall for the EVgo public network was 266 kilowatt hours per day in the first quarter of 2025, an increase of 36% compared to 196 kilowatt hours per day in the first quarter of 2024.

EVgo Autocharge+: Autocharge+ accounted for 27% of total charging sessions initiated in the first quarter of 2025.

Customer Accounts: Added over 119,000 new customer accounts in the first quarter, with a total of 1.4 million total customer accounts at the end of the quarter.

PlugShare: PlugShare reached 6.5 million registered users and achieved 9.4 million check-ins since inception.

Financing: On January 8, 2025, EVgo received its first advance of $75 million from its $1.25 billion loan guarantee from the U.S. Department of Energy Loan Programs Office under its Title 17 program, to build approximately 7,500 fast charging stalls across the U.S. over the next five years. On April 4, 2025, EVgo received its second advance of $19 million.

Financial & Operational Highlights

The below represent summary financial and operational figures for the first quarter of 2025.

Revenue of $75.3 million

Network Throughput¹ of 83 gigawatt-hours

Customer Account Additions of over 119,000 accounts

Gross Profit of $9.3 million

Net Loss Attributable to Class A Common Stockholders of $11.4 million

Adjusted Gross Profit² of $25.4 million

Adjusted EBITDA² of ($5.9) million

Net Cash Used in Operating Activities of ($10.2) million

Capital Expenditures of $15.0 million

Capital Expenditures, Net of Capital Offsets²of $8.1 million

¹ Network throughput for EVgo public network excludes dedicated and eXtend™ sites.

² Adjusted Gross Profit, Adjusted EBITDA, and Capital Expenditures, Net of Capital Offsets are non-GAAP measures and have not been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”). For a definition of these non-GAAP measures and a reconciliation to the most directly comparable GAAP measure, please see “Definitions of Non-GAAP Financial Measures” and “Reconciliations of Non-GAAP Financial Measures” included elsewhere in this release.

(unaudited, dollars in thousands)

Q1’25

Q1’24

Better (Worse)

Network Throughput (GWh)

83

52

60

%

Revenue

$

75,287

$

55,158

36

%

Gross profit

$

9,323

$

6,841

36

%

Gross margin

12.4

%

12.4

%

bps

Net loss

$

(26,227

)

$

(28,193

)

7

%

Adjusted Gross Profit¹

$

25,370

$

17,287

47

%

Adjusted Gross Margin¹

33.7

%

31.3

%

240 bps

Adjusted EBITDA¹

$

(5,929

)

$

(7,207

)

18

%

¹Adjusted Gross Profit, Adjusted Gross Margin, and Adjusted EBITDA are non-GAAP measures and have not been prepared in accordance with GAAP. For a definition of these non-GAAP measures and a reconciliation to the most directly comparable GAAP measures, please see “Definitions of Non-GAAP Financial Measures” and “Reconciliations of Non-GAAP Financial Measures” included elsewhere in these materials.

(unaudited, dollars in thousands)

Q1’25

Q1’24

Change

Cash flows used in operating activities

$

(10,246

)

$

(14,082

)

27

%

GAAP capital expenditures

$

14,992

$

21,071

(29

)%

Less capital offsets:

OEM infrastructure payments

4,975

5,826

(15

)%

Proceeds from capital-build funding

1,871

1,680

11

%

Total capital offsets

6,846

7,506

(9

)%

Capital Expenditures, Net of Capital Offsets¹

$

8,146

$

13,565

(40

)%

¹Capital Expenditures, Net of Capital Offsets is a non-GAAP measure and has not been prepared in accordance with GAAP. For a definition of these non-GAAP measures and a reconciliation to the most directly comparable GAAP measures, please see “Definitions of Non-GAAP Financial Measures” and “Reconciliations of Non-GAAP Financial Measures” included elsewhere in these materials.

3/31/2025

3/31/2024

Increase

Stalls in operation:

EVgo Public Network¹

3,510

3,040

15

%

EVgo Dedicated Network²

110

40

175

%

EVgo eXtend™

620

130

377

%

Total stalls in operation

4,240

3,210

32

%

¹Stalls on publicly available chargers at charging stations that we own and operate on our network.

²Stalls at charging stations that we own and operate on our network that are only available to dedicated fleet customers.

2025 Financial Guidance

EVgo is affirming guidance as follows:

Total revenue guidance of $340 – $380 million

Adjusted EBITDA^* of $(5) million – $10 million

* A reconciliation of projected Adjusted EBITDA (non-GAAP) to net income (loss), the most directly comparable GAAP measure, is not provided because certain measures, including share-based compensation expense, which is excluded from Adjusted EBITDA, cannot be reasonably calculated or predicted at this time without unreasonable efforts. For a definition of Adjusted EBITDA, please see “Definitions of Non-GAAP Financial Measures” included elsewhere in this release.

Webcast Information

A live audio webcast for EVgo’s first quarter 2025 results will be held today at 8 a.m. ET / 5 a.m. PT. The webcast will be available at investors.evgo.com.

This press release, along with other investor materials that will be used or referred to during the webcast, including a slide presentation and reconciliations of certain non-GAAP measures to their nearest GAAP measures, will also be available on that site.

About EVgo

EVgo (Nasdaq: EVGO) is one of the nation’s leading public fast charging providers. With more than 1,100 fast charging stations across over 40 states, EVgo strategically deploys localized and accessible charging infrastructure by partnering with leading businesses across the U.S., including retailers, grocery stores, restaurants, shopping centers, gas stations, rideshare operators, and autonomous vehicle companies. At its dedicated Innovation Lab, EVgo performs extensive interoperability testing and has ongoing technical collaborations with leading automakers and industry partners to advance the EV charging industry and deliver a seamless charging experience.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements generally relate to future events or the Company’s future financial or operating performance. In some cases, you can identify forward-looking statements by the use of words such as “estimate,” “plan,” “project,” “forecast,” “intend,” “will,” “expect,” “anticipate,” “believe,” “seek,” “target,” “assume” or other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward-looking statements are based on management’s current expectations or beliefs and are subject to numerous assumptions, risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. You are cautioned, therefore, against relying on any of these forward-looking statements. These forward-looking statements include, but are not limited to, express or implied statements regarding EVgo’s future financial and operating performance, revenues, market size and opportunity, capital expenditures and offsets; EVgo’s progress on its network buildout, customer experience, technological capabilities and cost efficiencies; EVgo’s expectation of potential tariffs’ impact on its business, cost and expenditures; growth in EVgo’s throughput; growth in EVgo’s commercial charging business; and EVgo’s collaboration with partners. These statements are based on various assumptions, whether or not identified in this press release, and on the current expectations of EVgo’s management and are not predictions of actual performance. There are a significant number of factors that could cause actual results to differ materially from the statements made in this press release, including changes adversely affecting our business; EVgo’s dependence on the widespread adoption of EVs and growth of the EV and EV charging markets; EVgo’s reliance on the DOE loan for the growth of our business, its ability to fully draw on the DOE loan and its ability to comply with the covenants and other terms of the DOE loan facility; competition from existing and new competitors; EVgo’s ability to expand into new service markets, grow its customer base and manage its operations; the risks associated with cyclical demand for EVgo’s services and vulnerability to industry downturns and regional or national downturns; fluctuations in EVgo’s revenue and operating results; unfavorable conditions or disruptions in the capital and credit markets and EVgo’s ability to obtain additional financing on commercially reasonable terms; EVgo’s ability to generate cash, service indebtedness and incur additional indebtedness; evolving domestic and foreign government laws, regulations, rules and standards that impact EVgo’s business, results of operations and financial condition, including regulations impacting the EV charging market and government programs designed to drive broader adoption of EVs and any reduction, modification or elimination of such programs, including changes in policy under the current administration and 119^th Congress and the potential changes in tariffs or sanctions and escalating trade wars; EVgo’s ability to adapt its assets and infrastructure to changes in industry and regulatory standards and market demands related to EV charging; impediments to EVgo’s expansion plans, including permitting and utility-related delays; EVgo’s ability to integrate any businesses it acquires; EVgo’s ability to recruit and retain experienced personnel; risks related to legal proceedings or claims, including liability claims; EVgo’s dependence on third parties, including hardware and software vendors and service providers, utilities and permit-granting entities; supply chain disruptions, elevated rates of inflation and other increases in expenses, including as a result of the implementation of tariffs by the U.S. and other countries; safety and environmental requirements or regulations that may subject EVgo to unanticipated liabilities or costs; EVgo’s ability to enter into and maintain valuable partnerships with commercial or public-entity property owners, landlords and/or tenants, original equipment manufacturers, fleet operators and suppliers; EVgo’s ability to maintain, protect and enhance EVgo’s intellectual property; EVgo’s ability to identify and complete suitable acquisitions or other strategic transactions to meet our goals and integrate key businesses we acquire; and the impact of general economic or political conditions, including associated changes in monetary policy such as elevated interest rates, changing tariff policies, and geopolitical events such as the conflicts in Ukraine, Israel and the broader Middle East region. The forward-looking statements contained in this press release are also subject to other risks and uncertainties, including those more fully described in the Company’s filings with the Securities and Exchange Commission (the “SEC”) including its most recent Annual Report on Form 10-K, as well as its other SEC filings, copies of which are available on EVgo’s website at investors.evgo.com, and on the SEC’s website at www.sec.gov. The forward-looking statements in this press release are based on information available to the Company as of the date hereof, and the Company disclaims any obligation to update any forward-looking statements, except as required by law.

Financial Statements

EVgo Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

March 31, 2025

December 31, 2024

(in thousands)

(unaudited)

Assets

Current assets

Cash and cash equivalents

$

150,008

$

117,273

Restricted cash, current

14,771

3,239

Accounts receivable, net of allowance of $1,827 and $1,196 as of March 31, 2025 and December 31, 2024

43,050

45,849

Accounts receivable, capital-build

19,077

17,732

Prepaids and other current assets

24,372

21,282

Total current assets

251,278

205,375

Property, equipment and software, net

413,869

414,968

Operating lease right-of-use assets

91,301

89,295

Restricted cash, noncurrent

5,801

—

Other assets

25,920

24,321

Intangible assets, net

36,760

38,750

Goodwill

31,052

31,052

Total assets

$

855,981

$

803,761

Liabilities, redeemable noncontrolling interest and stockholders’ deficit

Current liabilities

Accounts payable

$

16,166

$

13,031

Accrued liabilities

34,632

42,953

Operating lease liabilities, current

6,963

7,326

Deferred revenue, current

50,599

46,258

Other current liabilities

2,537

1,842

Total current liabilities

110,897

111,410

Operating lease liabilities, noncurrent

85,293

83,043

Earnout liability, at fair value

194

942

Asset retirement obligations

25,384

23,793

Capital-build liability

52,191

51,705

Deferred revenue, noncurrent

70,265

70,466

Warrant liabilities, at fair value

4,396

9,740

Other long-term liabilities

8,191

8,931

Long-term debt

76,296

—

Total liabilities

433,107

360,030

Commitments and contingencies

Redeemable noncontrolling interest

$

459,648

$

699,840

Stockholders’ deficit

Preferred stock, $0.0001 par value; 10,000,000 shares authorized as of March 31, 2025 and December 31, 2024; none issued and outstanding

—

—

Class A common stock, $0.0001 par value; 1,200,000,000 shares authorized as of March 31, 2025 and December 31, 2024; 133,311,372 and 129,973,698 shares outstanding (excluding 718,750 shares subject to possible forfeiture) as of March 31, 2025 and December 31, 2024, respectively

13

13

Class B common stock, $0.0001 par value; 400,000,000 shares authorized as of March 31, 2025 and December 31, 2024; 172,800,000 shares issued and outstanding as of March 31, 2025 and December 31, 2024

17

17

Additional paid-in capital

5,351

—

Accumulated deficit

(42,155

)

(256,139

)

Total stockholders’ deficit

(36,774

)

(256,109

)

Total liabilities, redeemable noncontrolling interest and stockholders’ deficit

$

855,981

$

803,761

EVgo Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

(unaudited)

Three Month Ended March 31,

(in thousands, except per share data)

2025

2024

Change %

Revenue

Charging, retail

$

30,015

$

18,326

64

%

Charging, commercial¹

7,783

5,107

52

%

Charging, OEM

5,258

2,732

92

%

Regulatory credit sales

2,786

2,034

37

%

Network, OEM

1,256

3,423

(63

)%

Total charging network

47,098

31,622

49

%

eXtend

23,488

19,151

23

%

Ancillary ¹

4,701

4,385

7

%

Total revenue

75,287

55,158

36

%

Cost of sales

Charging network ¹

29,609

18,710

58

%

Other¹

20,400

19,248

6

%

Depreciation, net of capital-build amortization

15,955

10,359

54

%

Total cost of sales

65,964

48,317

37

%

Gross profit

9,323

6,841

36

%

Operating expenses

General and administrative

38,628

34,226

13

%

Depreciation, amortization and accretion

4,095

4,985

(18

)%

Total operating expenses

42,723

39,211

9

%

Operating loss

(33,400

)

(32,370

)

(3

)%

Interest expense

(517

)

—

*

Interest income

1,694

2,273

(25

)%

Other expense, net

(5

)

(9

)

44

%

Change in fair value of earnout liability

748

208

260

%

Change in fair value of warrant liabilities

5,344

1,718

211

%

Total other income, net

7,264

4,190

73

%

Loss before income tax expense

(26,136

)

(28,180

)

7

%

Income tax expense

(91

)

(13

)

(600

)%

Net loss

(26,227

)

(28,193

)

7

%

Less: net loss attributable to redeemable noncontrolling interest

(14,865

)

(18,360

)

19

%

Net loss attributable to Class A common stockholders

$

(11,362

)

$

(9,833

)

(16

)%

Net loss per share to Class A common stockholders, basic and diluted

$

(0.09

)

$

(0.09

)

Weighted average Class A common stock outstanding, basic and diluted

131,794

104,676

* Percentage not meaningful

¹ During the fourth quarter of 2024, we reclassed revenues earned through our dedicated charging solutions to fleets from commercial charging revenue to ancillary revenue. In addition, the associated costs for those revenues were reclassed from charging network cost of sales to other cost of sales. Previously reported amounts have been updated to conform to the current period presentation.

EVgo Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(unaudited)

Three Months Ended March 31,

(in thousands)

2025

2024

Cash flows from operating activities

Net loss

$

(26,227

)

$

(28,193

)

Adjustments to reconcile net loss to net cash used in operating activities

Depreciation, amortization and accretion

20,050

15,344

Net loss on disposal of property and equipment, net of insurance recoveries, and impairment expense

1,199

2,740

Share-based compensation

5,494

4,701

Change in fair value of earnout liability

(748

)

(208

)

Change in fair value of warrant liabilities

(5,344

)

(1,718

)

Paid-in-kind interest, amortization of deferred debt issuance costs, net of capitalized interest

513

—

Other

7

5

Changes in operating assets and liabilities

Accounts receivable, net

2,798

(379

)

Prepaids and other current assets and other assets

(4,810

)

(1,763

)

Operating lease assets and liabilities, net

(119

)

40

Accounts payable

632

(137

)

Accrued liabilities

(7,657

)

(5,595

)

Deferred revenue

4,141

1,266

Other current and noncurrent liabilities

(175

)

(185

)

Net cash used in operating activities

(10,246

)

(14,082

)

Cash flows from investing activities

Capital expenditures

(14,992

)

(21,071

)

Proceeds from insurance for property losses

22

48

Net cash used in investing activities

(14,970

)

(21,023

)

Cash flows from financing activities

Proceeds from long-term debt

75,291

—

Proceeds from capital-build funding

1,871

1,680

Payments of withholding tax on net issuance of restricted stock units

(528

)

—

Payments of deferred debt issuance costs

(1,350

)

(195

)

Net cash provided by financing activities

75,284

1,485

Net increase (decrease) in cash, cash equivalents and restricted cash

50,068

(33,620

)

Cash, cash equivalents and restricted cash, beginning of period

120,512

209,146

Cash, cash equivalents and restricted cash, end of period

$

170,580

$

175,526

Use of Non-GAAP Financial Measures

To supplement EVgo’s financial information, which is prepared and presented in accordance with GAAP, EVgo uses certain non-GAAP financial measures. The presentation of non-GAAP financial measures is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. EVgo uses these non-GAAP financial measures for financial and operational decision-making and as a means to evaluate period-to-period comparisons. EVgo believes that these non-GAAP financial measures provide meaningful supplemental information regarding the Company’s performance by excluding certain items that may not be indicative of EVgo’s recurring core business operating results.

EVgo believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing EVgo’s performance. These non-GAAP financial measures also facilitate management’s internal comparisons to the Company’s historical performance. EVgo believes these non-GAAP financial measures are useful to investors both because (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making and (2) they are used by EVgo’s institutional investors and the analyst community to help them analyze the health of EVgo’s business.

For more information on these non-GAAP financial measures, including reconciliations to the most comparable GAAP measures, please see the sections titled “Definitions of Non-GAAP Financial Measures” and “Reconciliations of Non-GAAP Financial Measures.”

Definitions of Non-GAAP Financial Measures

This release includes some, but not all of the following non-GAAP financial measures, in each case as defined below: “Charging Network Gross Profit,” “Charging Network Gross Margin,” “Adjusted Cost of Sales,” “Adjusted Cost of Sales as a Percentage of Revenue,” “Adjusted Gross Profit (Loss),” “Adjusted Gross Margin,” “Adjusted General and Administrative Expenses,” “Adjusted General and Administrative Expenses as a Percentage of Revenue,” “EBITDA,” “EBITDA Margin,” “Adjusted EBITDA,” “Adjusted EBITDA Margin,” and “Capital Expenditures, Net of Capital Offsets.” With respect to Capital Expenditures, Net of Capital Offsets, pursuant to the terms of certain OEM contracts, EVgo is paid well in advance of when revenue can be recognized, and usually, the payment is tied to the number of stalls that commence operations under the applicable contractual arrangement while the related revenue is deferred at the time of payment and is recognized as revenue over time as EVgo provides charging and other services to the OEM and the OEM’s customers. EVgo management therefore uses these measures internally to establish forecasts, budgets, and operational goals to manage and monitor its business, including the cash used for, and the return on, its investment in its charging infrastructure. EVgo believes that these measures are useful to investors in evaluating EVgo’s performance and help to depict a meaningful representation of the performance of the underlying business, enabling EVgo to evaluate and plan more effectively for the future.

Charging Network Gross Profit, Charging Network Gross Margin, Adjusted Cost of Sales, Adjusted Cost of Sales as a Percentage of Revenue, Adjusted Gross Profit (Loss), Adjusted Gross Margin, Adjusted General and Administrative Expenses, Adjusted General and Administrative Expenses as a Percentage of Revenue, EBITDA, EBITDA Margin, Adjusted EBITDA, Adjusted EBITDA Margin and Capital Expenditures, Net of Capital Offsets are not prepared in accordance with GAAP and may be different from non-GAAP financial measures used by other companies. These measures should not be considered as measures of financial performance under GAAP and the items excluded from or included in these metrics are significant components in understanding and assessing EVgo’s financial performance. These metrics should not be considered as alternatives to net income (loss) or any other performance measures derived in accordance with GAAP.

EVgo defines Charging Network Gross Profit as total charging network revenue less charging network cost of sales. EVgo defines Charging Network Gross Margin as Charging Network Gross Profit divided by total charging network revenue. EVgo defines Adjusted Cost of Sales as cost of sales before (i) depreciation, net of capital-build amortization, and (ii) share-based compensation. EVgo defines Adjusted Cost of Sales as a Percentage of Revenue as Adjusted Cost of Sales as a percentage of revenue. EVgo defines Adjusted Gross Profit (Loss) as revenue less Adjusted Cost of Sales. EVgo defines Adjusted Gross Margin as Adjusted Gross Profit (Loss) as a percentage of revenue. EVgo defines Adjusted General and Administrative Expenses as general and administrative expenses before (i) share-based compensation, (ii) loss on disposal of property and equipment, net of insurance recoveries, and impairment expense, (iii) bad debt expense (recoveries), and (iv) certain other items that management believes are not indicative of EVgo’s ongoing performance. EVgo defines Adjusted General and Administrative Expenses as a Percentage of Revenue as Adjusted General and Administrative Expenses as a percentage of revenue. EVgo defines EBITDA as net income (loss) before (i) depreciation, net of capital-build amortization, (ii) amortization, (iii) accretion, (iv) interest income, (v) interest expense, and (vi) income tax expense (benefit). EVgo defines EBITDA Margin as EBITDA as a percentage of revenue. EVgo defines Adjusted EBITDA as EBITDA plus (i) share-based compensation, (ii) loss on disposal of property and equipment, net of insurance recoveries, and impairment expense, (iii) loss (gain) on investments, (iv) bad debt expense (recoveries), (v) change in fair value of earnout liability, (vi) change in fair value of warrant liabilities, and (vii) certain other items that management believes are not indicative of EVgo’s ongoing performance. EVgo defines Adjusted EBITDA Margin as Adjusted EBITDA as a percentage of revenue. EVgo defines Capital Expenditures, Net of Capital Offsets as capital expenditures adjusted for the following capital offsets: (i) all payments under OEM infrastructure agreements excluding any amounts directly attributable to OEM customer charging credit programs and pass-through of non-capital expense reimbursements, (ii) proceeds from capital-build funding and (iii) proceeds from the transfer of 30C income tax credits, net of transaction costs. The tables below present quantitative reconciliations of these measures to their most directly comparable GAAP measures as described in this paragraph.

Reconciliations of Non-GAAP Financial Measures

The following unaudited table presents a reconciliation of EBITDA, EBITDA Margin, Adjusted EBITDA, and Adjusted EBITDA Margin to the most directly comparable GAAP measure:

(unaudited, dollars in thousands)

Q1’25

Q1’24

Change

GAAP revenue

$

75,287

$

55,158

36

%

GAAP net loss

$

(26,227

)

$

(28,193

)

7

%

GAAP net loss margin

(34.8

%)

(51.1

%)

1,630 bps

EBITDA adjustments:

Depreciation, net of capital-build amortization

16,039

10,476

53

%

Amortization

3,424

4,463

(23

)%

Accretion

587

405

45

%

Interest expense

517

—

*

Interest income

(1,694

)

(2,273

)

25

%

Income tax expense

91

13

600

%

Total EBITDA adjustments

18,964

13,084

45

%

EBITDA

(7,263

)

(15,109

)

52

%

EBITDA Margin

(9.6

%)

(27.4

%)

1,780 bps

Adjustments:

Share-based compensation

5,494

4,701

17

%

Loss on disposal of property and equipment, net of insurance recoveries, and impairment expense

1,199

2,740

(56

)%

Loss on investments

—

5

(100

)%

Bad debt expense

593

230

158

%

Change in fair value of earnout liability

(748

)

(208

)

(260

)%

Change in fair value of warrant liabilities

(5,344

)

(1,718

)

(211

)%

Other¹

140

2,152

(93

)%

Total Adjusted EBITDA adjustments

1,334

7,902

(83

)%

Adjusted EBITDA

$

(5,929

)

$

(7,207

)

18

%

Adjusted EBITDA Margin

(7.9

%)

(13.1

%)

520 bps

* Percentage greater than 999% or not meaningful.

¹ For the quarter ended March 31, 2025, comprised primarily of nonrecurring professional fees related to the underwritten public offering of 23,000,000 shares of Class A common stock undertaken pursuant underwriting agreement entered into as of December 16, 2024, by and among EVgo, EVgo Holdings, J.P. Morgan Securities LLC, Goldman Sachs & Co. LLC, Morgan Stanley & Co. LLC and Evercore Group L.L.C., as representatives of several underwriters, which closed on December 18, 2024 (“Secondary Offering”). For the quarter ended March 31, 2024, comprised primarily of costs related to the reorganization of our resources previously announced by us on January 17, 2024

The following unaudited table presents a reconciliation of Charging Network Gross Profit and Charging Network Gross Margin to the most directly comparable GAAP measures:

(unaudited, dollars in thousands)

Q1’25

Q1’24

Change

GAAP total charging network revenue¹

$

47,098

$

31,622

49

%

GAAP charging network cost of sales¹

29,609

18,710

58

%

Charging Network Gross Profit

$

17,489

$

12,912

35

%

Charging Network Gross Margin

37.1

%

40.8

%

(370) bps

¹ During the fourth quarter of 2024, we reclassed revenues earned through our dedicated charging solutions to fleets from commercial charging revenue to ancillary revenue. In addition, the associated costs for those revenues were reclassed from charging network cost of sales to other cost of sales. Previously reported amounts have been updated to conform to the current period presentation.

The following unaudited table presents a reconciliation of Adjusted Cost of Sales, Adjusted Cost of Sales as a Percentage of Revenue, Adjusted Gross Profit and Adjusted Gross Margin to the most directly comparable GAAP measures:

(unaudited, dollars in thousands)

Q1’25

Q1’24

Change

GAAP revenue

$

75,287

$

55,158

36

%

GAAP cost of sales

65,964

48,317

37

%

GAAP gross profit

$

9,323

$

6,841

36

%

GAAP cost of sales as a percentage of revenue

87.6

%

87.6

%

00 bps

GAAP gross margin

12.4

%

12.4

%

00 bps

Adjusted Cost of Sales adjustments

Depreciation, net of capital-build amortization

$

15,955

$

10,359

54

%

Share-based compensation

92

87

6

%

Total Adjusted Cost of Sales adjustments

$

16,047

$

10,446

54

%

Adjusted Cost of Sales

$

49,917

$

37,871

32

%

Adjusted Cost of Sales as a Percentage of Revenue

66.3

%

68.7

%

(240) bps

Adjusted Gross Profit

$

25,370

$

17,287

47

%

Adjusted Gross Margin

33.7

%

31.3

%

240 bps

The following unaudited table presents a reconciliation of Adjusted General and Administrative Expenses and Adjusted General and Administrative Expenses as a Percentage of Revenue to the most directly comparable GAAP measures:

(unaudited, dollars in thousands)

Q1’25

Q1’24

Change

GAAP revenue

$

75,287

$

55,158

36

%

GAAP general and administrative expenses

$

38,628

$

34,226

13

%

GAAP general and administrative expenses as a percentage of revenue

51.3

%

62.1

%

(1,080) bps

Less adjustments:

Share-based compensation

5,402

4,614

17

%

Loss on disposal of property and equipment, net of insurance recoveries, and impairment expense

1,199

2,740

(56

)%

Bad debt expense

593

230

158

%

Other¹

140

2,152

(93

)%

Total adjustments

7,334

9,736

(25

)%

Adjusted General and Administrative Expenses

$

31,294

$

24,490

28

%

Adjusted General and Administrative Expenses as a Percentage of Revenue

41.6

%

44.4

%

(280) bps

¹ For the quarter ended March 31, 2025, comprised primarily of nonrecurring professional fees related to the Secondary Offering, which closed on December 18, 2024. For the quarter ended March 31, 2024, comprised primarily of costs related to the reorganization of our resources previously announced by us on January 17, 2024

The following unaudited table presents a reconciliation of Capital Expenditures, Net of Capital Offsets, to the most directly comparable GAAP measure:

(unaudited, dollars in thousands)

Q1’25

Q1’24

Change

GAAP capital expenditures

$

14,992

$

21,071

(29

)%

Less capital offsets:

OEM infrastructure payments

4,975

5,826

(15

)%

Proceeds from capital-build funding

1,871

1,680

11

%

Total capital offsets

6,846

7,506

(9

)%

Capital Expenditures, Net of Capital Offsets

$

8,146

$

13,565

(40

)%

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Posted on May 6, 2025 7:11 am
CareCloud Delivers Growth and Strong Cash Flow in Q1 2025, Advances AI and Acquisition Strategy

SOMERSET, N.J., May 06, 2025 (GLOBE NEWSWIRE) —
CareCloud, Inc. (Nasdaq: CCLD, CCLDO), a leader in healthcare technology and generative AI solutions, today announced strong financial results for the three months ended March 31, 2025. CareCloud’s strategic execution, AI-driven innovation, and disciplined financial management have fueled a transformational turnaround, positioning the Company for sustained profitability and long-term growth. Management will discuss these results and the Company’s 2025 growth strategies in a live conference call today at 8:30 a.m. ET.

First Quarter 2025 Financial Highlights:

Revenue of $27.6 million, compared to $26.0 million in Q1 2024, an increase of 6% year-over-year

GAAP net income of $1.9 million, compared to a net loss of $241,000 in Q1 2024

Adjusted EBITDA of $5.6 million, compared to $3.7 million in Q1 2024, an increase of 52%

Adjusted net income of $2.3 million, or $0.05 per share

Cash balance of $6.8 million and net working capital of $11.7 million as of March 31, 2025

Recent Strategic Updates

AI Center of Excellence Launched: CareCloud launched its dedicated AI Center of Excellence, onboarding the first wave of over 50 AI professionals and aiming to scale to 500 AI specialists by fourth quarter 2025. The initiative is fully self-funded through operating cash flows.

Series A Preferred Stock Conversion Completed: Successfully converted 3.5 million Series A preferred shares into 26 million common shares, reducing the annual dividend commitment by approximately $7.7 million and strengthening cash flow and the capital structure.

Resumption of Preferred Dividends: Payments of preferred dividends resumed in February 2025.

Acquisition Strategy Reignited: Completed two strategic acquisitions in March and April 2025, with additional acquisition opportunities actively under evaluation.

Management Commentary:

“The launch of our AI Center of Excellence marks a pivotal moment in CareCloud’s evolution,” said A. Hadi Chaudhry, Co-CEO of CareCloud. “By building one of the largest dedicated healthcare AI teams globally, we believe we are creating real-world solutions to automate clinical workflows, optimize revenue cycle management, and improve patient outcomes. This initiative is intended to accelerate our operational efficiency as well as positioning CareCloud at the forefront of intelligent healthcare transformation — driving sustainable profitability and long-term growth for ourselves and the healthcare providers who use our services.”

“After record profits and a successful turnaround in 2024, we are excited to announce continued momentum and strength as we enter 2025,” said Co-CEO Stephen Snyder. “With two recent acquisitions and the launch of our AI Center of Excellence, CareCloud is not just responding to the market shift — we are intending to lead it.”

“We are pleased to announce our fourth consecutive quarter of positive GAAP net income and an increase in revenue and adjusted EBITDA year over year,” said Norman Roth, Interim CFO and Corporate Controller of CareCloud. “We have resumed paying our Preferred Stock dividends monthly out of internally-generated free cash flow, while generating additional profits and cash flow to reinvest for future growth. To date we have declared six months of Preferred Stock dividends.”

Capital

On March 31, 2025, the Company had 984,530 shares of Series A Preferred Stock and 1,511,372 shares of non-convertible Series B Preferred Stock outstanding. As of March 31, 2025, the Series A and B shares both accrued dividends at the rate of 8.75% per annum, based on the $25.00 per share liquidation preference (equivalent to $2.1875 annually per share), and they are redeemable at the Company’s option once the preferred stock dividends are brought current.

2025 Guidance: Poised for Growth

CareCloud is reconfirming its earnings guidance for 2025, expecting:

For the Fiscal Year Ending December 31, 2025
Forward-Looking Guidance

Revenue $111 – $114 million

Adjusted EBITDA $26 – $28 million

Net Income Per Share (EPS) $0.10 – $0.13

The Company continues to anticipate full year 2025 revenue of approximately $111 to $114 million. Revenue guidance is based on management’s expectations regarding revenue from existing clients, organic growth in new client additions and anticipated number of small tuck-in acquisitions.

Adjusted EBITDA is expected to be $26 to $28 million for full year 2025 and reflects improvements from the Company’s cost reduction efforts. EPS is expected to be $0.10 to $0.13 for full year 2025.

Conference Call Information

CareCloud management will host a conference call today at 8:30 a.m. Eastern Time to discuss the first three months of 2025 results. The live webcast of the conference call and related presentation slides can be accessed at ir.carecloud.com/events. An audio-only option is available by dialing 201-389-0920 and referencing “CareCloud First Quarter 2025 Results Conference Call.” Investors who opt for audio-only will need to download the related slides at ir.carecloud.com/events.

A replay of the conference call and related presentation slides will be available approximately three hours after conclusion of the call at the same link. An audio-only option can also be accessed by dialing 412-317-6671 and providing the access code 13753440.

Use of Non-GAAP Financial Measures

In our earnings releases, prepared remarks, conference calls, slide presentations, and webcasts, we use and discuss non-GAAP financial measures, as defined by SEC Regulation G. The GAAP financial measure most directly comparable to each non-GAAP financial measure used or discussed, and a reconciliation of the differences between each non-GAAP financial measure and the comparable GAAP financial measure, are included in this press release after the condensed consolidated financial statements. Our earnings press releases containing such non-GAAP reconciliations can be found in the Investor Relations section of our web site at ir.carecloud.com.

Forward-Looking Statements

This press release contains various forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements relate to anticipated future events, future results of operations or future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may,” “might,” “will,” “shall,” “should,” “could,” “intends,” “expects,” “plans,” “goals,” “projects,” “anticipates,” “believes,” “seeks,” “estimates,” “forecasts,” “predicts,” “possible,” “potential,” “target,” or “continue” or the negative of these terms or other comparable terminology.

Our operations involve risks and uncertainties, many of which are outside our control, and any one of which, or a combination of which, could materially affect our results of operations and whether the forward-looking statements ultimately prove to be correct. Forward-looking statements in this press release include, without limitation, statements reflecting management’s expectations for future financial performance and operating expenditures, expected growth, profitability and business outlook, the impact of pandemics on our financial performance and business activities, and the expected results from the integration of our acquisitions.

These forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are only predictions, are uncertain and involve substantial known and unknown risks, uncertainties and other factors which may cause our (or our industry’s) actual results, levels of activity or performance to be materially different from any future results, levels of activity or performance expressed or implied by these forward-looking statements. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all of the risks and uncertainties that could have an impact on the forward-looking statements, including without limitation, risks and uncertainties relating to the Company’s ability to manage growth, migrate newly acquired customers and retain new and existing customers, maintain cost-effective global operations, increase operational efficiency and reduce operating costs, predict and properly adjust to changes in reimbursement and other industry regulations and trends, retain the services of key personnel, develop new technologies, upgrade and adapt legacy and acquired technologies to work with evolving industry standards, compete with other companies’ products and services competitive with ours, manage and keep our information systems secure and other important risks and uncertainties referenced and discussed under the heading titled “Risk Factors” in the Company’s filings with the Securities and Exchange Commission.

The statements in this press release are made as of the date of this press release, even if subsequently made available by the Company on its website or otherwise. The Company does not assume any obligations to update the forward-looking statements provided to reflect events that occur or circumstances that exist after the date on which they were made.

About CareCloud

CareCloud (Nasdaq: CCLD, CCLDO) brings disciplined innovation and generative AI solutions to the business of healthcare. Our suite of technology-enabled solutions helps clients increase financial and operational performance, streamline clinical workflows and improve the patient experience. More than 40,000 providers count on CareCloud to help them improve patient care while reducing administrative burdens and operating costs. Learn more about our products and services, including revenue cycle management (RCM), practice management (PM), electronic health records (EHR), artificial intelligence (AI), business intelligence (BI), patient experience management (PXM) and digital health, at carecloud.com.

Follow CareCloud on LinkedIn, X and Facebook.

For additional information, please visit our website at carecloud.com. To listen to video presentations by CareCloud’s management team, read recent press releases and view the latest investor presentation, please visit ir.carecloud.com.

SOURCE CareCloud

Company Contact:

Norman Roth
Interim Chief Financial Officer and Corporate Controller
CareCloud, Inc.
[email protected]

Investor Contact:

Stephen Snyder
Co-Chief Executive Officer
CareCloud, Inc.
[email protected]

CARECLOUD, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

($ in thousands, except share and per share amounts)

March 31, December 31,

2025 2024

(Unaudited)

ASSETS

Current assets:

Cash $ 6,805 $ 5,145

Accounts receivable – net 13,887 12,774

Contract asset 4,457 4,334

Inventory 609 574

Current assets – related party 16 16

Prepaid expenses and other current assets 2,843 1,957

Total current assets 28,617 24,800

Property and equipment – net 5,323 5,290

Operating lease right-of-use assets 3,097 3,133

Intangible assets – net 16,877 18,698

Goodwill 19,186 19,186

Other assets 456 507

TOTAL ASSETS $ 73,556 $ 71,614

LIABILITIES AND SHAREHOLDERS’ EQUITY

Current liabilities:

Accounts payable $ 4,951 $ 4,565

Accrued compensation 2,865 1,817

Accrued expenses 5,002 4,951

Operating lease liability (current portion) 1,355 1,287

Deferred revenue (current portion) 1,297 1,212

Notes payable (current portion) 133 310

Contingent consideration (current portion) 47 –

Dividend payable 1,299 5,438

Total current liabilities 16,949 19,580

Notes payable 23 26

Contingent consideration 60 –

Operating lease liability 1,776 1,847

Deferred revenue 571 387

Total liabilities 19,379 21,840

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS’ EQUITY:

Preferred stock, $0.001 par value – authorized 7,000,000 shares. Series A, issued and outstanding 984,530 and 4,526,231 shares at March 31, 2025 and December 31, 2024, respectively. Series B, issued and outstanding 1,511,372 shares at March 31, 2025 and December 31, 2024. 2 6

Common stock, $0.001 par value – authorized 85,000,000 shares. Issued 43,061,928 and 16,997,035 shares at March 31, 2025 and December 31, 2024, respectively. Outstanding 42,321,129 and 16,256,236 shares at March 31, 2025 and December 31, 2024, respectively 43 17

Additional paid-in capital 123,537 121,046

Accumulated deficit (64,682 ) (66,630 )

Accumulated other comprehensive loss (4,061 ) (4,003 )

Less: 740,799 common shares held in treasury, at cost at March 31, 2025 and December 31, 2024 (662 ) (662 )

Total shareholders’ equity 54,177 49,774

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $ 73,556 $ 71,614

CARECLOUD, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

FOR THE THREE MONTHS ENDED MARCH 31, 2025 AND 2024

($ in thousands, except share and per share amounts)

Three Months Ended

March 31,

2025 2024*

NET REVENUE $ 27,632 $ 25,962

OPERATING EXPENSES:

Direct operating costs 15,464 15,177

Selling and marketing 1,131 1,770

General and administrative 4,332 3,721

Research and development 1,235 913

Depreciation and amortization 3,337 3,930

Restructuring costs 114 322

Total operating expenses 25,613 25,833

OPERATING INCOME 2,019 129

OTHER:

Interest income 42 27

Interest expense (58 ) (365 )

Other (expense) income – net (14 ) 7

INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES 1,989 (202 )

Income tax provision 41 39

NET INCOME (LOSS) $ 1,948 $ (241 )

Preferred stock dividend 2,811 1,312

NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS $ (863 ) $ (1,553 )

Net loss per common share: basic and diluted $ (0.04 ) $ (0.10 )

Weighted-average common shares used to compute basic and diluted loss per share 23,813,943 16,014,309

* Restated to include the preferred stock dividends earned, but not declared, during the three months ended March 31, 2024.

CARECLOUD, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

FOR THE THREE MONTHS ENDED MARCH 31, 2025 AND 2024

($ in thousands)

2025 2024

OPERATING ACTIVITIES:

Net income (loss) $ 1,948 $ (241 )

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Depreciation and amortization 3,407 4,020

Lease amortization 480 509

Deferred revenue 269 58

Provision for expected credit losses 70 37

Foreign exchange gain (1 ) (11 )

Interest accretion 107 168

Stock-based compensation expense (benefit) 108 (708 )

Changes in operating assets and liabilities:

Accounts receivable (1,183 ) (111 )

Contract asset (105 ) (361 )

Inventory (35 ) (15 )

Other assets (908 ) –

Accounts payable and other liabilities 956 721

Net cash provided by operating activities 5,113 4,066

INVESTING ACTIVITIES:

Purchases of property and equipment (624 ) (298 )

Capitalized software and other intangible assets (846 ) (1,570 )

Initial payment for acquisition (40 ) –

Net cash used in investing activities (1,510 ) (1,868 )

FINANCING ACTIVITIES:

Preferred stock dividends paid (1,730 ) –

Settlement of tax withholding obligations on stock issued to employees (21 ) (151 )

Repayments of notes payable (181 ) (223 )

Repayment of line of credit – (1,000 )

Net cash used in financing activities (1,932 ) (1,374 )

EFFECT OF EXCHANGE RATE CHANGES ON CASH (11 ) (17 )

NET INCREASE IN CASH 1,660 807

CASH – Beginning of the period 5,145 3,331

CASH – End of the period $ 6,805 $ 4,138

SUPPLEMENTAL NONCASH INVESTING AND FINANCING ACTIVITIES:

Conversion of preferred stock and accrued dividends to common stock $ 2,435 $ –

Dividends declared, not paid $ 1,299 $ 5

Purchase of prepaid insurance with assumption of note $ – $ 96

Reclass of deposits for property and equipment placed in service $ – $ 296

SUPPLEMENTAL INFORMATION – Cash paid during the period for:

Income taxes $ 15 $ 6

Interest $ 18 $ 295

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
TO COMPARABLE GAAP MEASURES

The following is a reconciliation of the non-GAAP financial measures used by us to describe our financial results determined in accordance with accounting principles generally accepted in the United States of America (“GAAP”). An explanation of these measures is also included below under the heading “Explanation of Non-GAAP Financial Measures.”

While management believes that these non-GAAP financial measures provide useful supplemental information to investors regarding the underlying performance of our business operations, investors are reminded to consider these non-GAAP measures in addition to, and not as a substitute for, financial performance measures prepared in accordance with GAAP. In addition, it should be noted that these non-GAAP financial measures may be different from non-GAAP measures used by other companies, and management may utilize other measures to illustrate performance in the future. Non-GAAP measures have limitations in that they do not reflect all of the amounts associated with our results of operations as determined in accordance with GAAP.

Adjusted EBITDA to GAAP Net Income (Loss)

Set forth below is a reconciliation of our “adjusted EBITDA” to our GAAP net income (loss).

Three Months Ended March 31,

2025 2024

($ in thousands)

Net revenue $ 27,632 $ 25,962

GAAP net income (loss) 1,948 (241 )

Provision for income taxes 41 39

Net interest expense 16 338

Foreign exchange loss (gain) / other expense 19 (5 )

Stock-based compensation expense (benefit) 108 (708 )

Depreciation and amortization 3,337 3,930

Transaction and integration costs 12 12

Restructuring costs 114 322

Adjusted EBITDA $ 5,595 $ 3,687

Non-GAAP Adjusted Operating Income to GAAP Operating Income

Set forth below is a reconciliation of our non-GAAP “adjusted operating income” and non-GAAP “adjusted operating margin” to our GAAP operating income and GAAP operating margin.

Three Months Ended March 31,

2025 2024

($ in thousands)

Net revenue $ 27,632 $ 25,962

GAAP net income (loss) 1,948 (241 )

Provision for income taxes 41 39

Net interest expense 16 338

Other expense (income) – net 14 (7 )

GAAP operating income 2,019 129

GAAP operating margin 7.3 % 0.5 %

Stock-based compensation expense (benefit) 108 (708 )

Amortization of purchased intangible assets 89 840

Transaction and integration costs 12 12

Restructuring costs 114 322

Non-GAAP adjusted operating income $ 2,342 $ 595

Non-GAAP adjusted operating margin 8.5 % 2.3 %

Non-GAAP Adjusted Net Income to GAAP Net Income (Loss)

Set forth below is a reconciliation of our non-GAAP “adjusted net income” and non-GAAP “adjusted net income per share” to our GAAP net income (loss) and GAAP net loss per share.

Three Months Ended March 31,

2025 2024

($ in thousands)

GAAP net income (loss) $ 1,948 $ (241 )

Foreign exchange loss (gain) / other expense 19 (5 )

Stock-based compensation expense (benefit) 108 (708 )

Amortization of purchased intangible assets 89 840

Transaction and integration costs 12 12

Restructuring costs 114 322

Non-GAAP adjusted net income $ 2,290 $ 220

End-of-period common shares 42,321,129 16,118,492

Non-GAAP adjusted net income per share $ 0.05 $ 0.01

For purposes of determining non-GAAP adjusted net income per share, we used the number of common shares outstanding as of March 31, 2025 and 2024.

Three Months Ended March 31,

2025 2024

GAAP net loss attributable to common shareholders, per share $ (0.04 ) $ (0.10 )

Impact of preferred stock dividend 0.09 0.08

Net income (loss) per end-of-period share 0.05 (0.02 )

Foreign exchange loss (gain) / other expense 0.00 0.00

Stock-based compensation expense (benefit) 0.00 (0.04 )

Amortization of purchased intangible assets 0.00 0.05

Transaction and integration costs 0.00 0.00

Restructuring costs 0.00 0.02

Non-GAAP adjusted earnings per share $ 0.05 $ 0.01

Net cash provided by operating activities to free cash flow

Set forth below is a reconciliation of our non-GAAP “free cash flow” to our GAAP net cash provided by operating activities.

Three Months Ended March 31,

2025 2024

($ in thousands)

Net cash provided by operating activities $ 5,113 $ 4,066

Purchases of property and equipment (624 ) (298 )

Capitalized software and other intangible assets (846 ) (1,570 )

Free cash flow $ 3,643 $ 2,198

Net cash used in investing activities ¹ $ (1,510 ) $ (1,868 )

Net cash used in financing activities $ (1,932 ) $ (1,374 )

¹Net cash used in investing activities includes purchases of property and equipment and capitalized software and other intangible assets, which are also included in our computation of free cash flow.

Explanation of Non-GAAP Financial Measures

We report our financial results in accordance with accounting principles generally accepted in the United States of America, or GAAP. However, management believes that, in order to properly understand our short-term and long-term financial and operational trends, investors may wish to consider the impact of certain non-cash or non-recurring items, when used as a supplement to financial performance measures in accordance with GAAP. These items result from facts and circumstances that vary in frequency and impact on continuing operations. Management also uses results of operations before such items to evaluate the operating performance of CareCloud and compare it against past periods, make operating decisions, and serve as a basis for strategic planning. These non-GAAP financial measures provide management with additional means to understand and evaluate the operating results and trends in our ongoing business by eliminating certain non-cash expenses and other items that management believes might otherwise make comparisons of our ongoing business with prior periods more difficult, obscure trends in ongoing operations, or reduce management’s ability to make useful forecasts. Management believes that these non-GAAP financial measures provide additional means of evaluating period-over-period operating performance. In addition, management understands that some investors and financial analysts find this information helpful in analyzing our financial and operational performance and comparing this performance to our peers and competitors.

Management uses adjusted EBITDA, adjusted operating income, adjusted operating margin, and non-GAAP adjusted net income to provide an understanding of aspects of operating results before the impact of investing and financing charges and income taxes. Adjusted EBITDA may be useful to an investor in evaluating our operating performance and liquidity because this measure excludes non-cash expenses as well as expenses pertaining to investing or financing transactions. Management defines “adjusted EBITDA” as the sum of GAAP net income (loss) before provision for income taxes, net interest expense, foreign exchange loss (gain) / other expense, stock-based compensation expense (benefit), depreciation and amortization, transaction and integration costs, and restructuring costs.

Management defines “non-GAAP adjusted operating income” as the sum of GAAP operating income before stock-based compensation expense (benefit), amortization of purchased intangible assets, transaction and integration costs, and restructuring costs, and “non-GAAP adjusted operating margin” as non-GAAP adjusted operating income divided by net revenue.

Management defines “non-GAAP adjusted net income” as the sum of GAAP net income (loss) before foreign exchange loss (gain) / other expense, stock-based compensation expense (benefit), amortization of purchased intangible assets, transaction and integration costs, and restructuring costs, and “non-GAAP adjusted net income per share” as non-GAAP adjusted net income divided by common shares outstanding at the end of the period.

Management defines “free cash flow” as the sum of net cash provided by operating activities less cash used for purchases of property and equipment and cash used to develop capitalized software and other intangible assets.

Management considers all of these non-GAAP financial measures to be important indicators of our operational strength and performance of our business and a good measure of our historical operating trends, in particular the extent to which ongoing operations impact our overall financial performance.

In addition to items routinely excluded from non-GAAP EBITDA, management excludes or adjusts each of the items identified below from the applicable non-GAAP financial measure referenced above for the reasons set forth with respect to that excluded item:

Foreign exchange loss (gain) / other expense. Other expense is excluded because foreign currency gains and losses and other non-operating expenses are expenditures that management does not consider part of ongoing operating results when assessing the performance of our business, and also because the total amount of the expense is partially outside of our control. Foreign currency gains and losses are based on global market factors which are unrelated to our performance during the period in which the gains and losses are recorded.

Stock-based compensation expense (benefit). Stock-based compensation expense (benefit) is excluded because this is primarily a non-cash expenditure that management does not consider part of ongoing operating results when assessing the performance of our business, and also because the total amount of the expenditure is partially outside of our control because it is based on factors such as stock price, volatility, and interest rates, which may be unrelated to our performance during the period in which the expenses are incurred. Stock-based compensation expense includes cash-settled awards based on changes in the stock price.

Amortization of purchased intangible assets. Purchased intangible assets are amortized over their estimated useful lives and generally cannot be changed or influenced by management after the acquisition. Accordingly, this item is not considered by management in making operating decisions. Management does not believe such charges accurately reflect the performance of our ongoing operations for the period in which such charges are recorded.

Transaction costs. Transaction costs are upfront costs related to acquisitions and related transactions, such as brokerage fees, pre-acquisition accounting costs and legal fees, and other upfront costs related to specific transactions. Management believes that such expenses do not have a direct correlation to future business operations, and therefore, these costs are not considered by management in making operating decisions. Management does not believe such charges accurately reflect the performance of our ongoing operations for the period in which such charges are incurred.

Integration costs. Integration costs are severance payments for certain employees relating to our acquisitions and exit costs related to terminating leases and other contractual agreements. Accordingly, management believes that such expenses do not have a direct correlation to future business operations, and therefore, these costs are not considered by management in making operating decisions. Management does not believe such charges accurately reflect the performance of our ongoing operations for the period in which such charges are incurred.

Restructuring costs. Restructuring costs primarily consist of severance and separation costs associated with the optimization of the Company’s operations and profitability improvements. Management believes that such expenses do not have a direct correlation to future business operations, and therefore, these costs are not considered by management in making operating decisions. Management does not believe such charges accurately reflect the performance of our ongoing operations for the period in which such charges are incurred.

Free cash flow. Management believes that free cash flow, which measures our ability to generate additional cash from our business operations, is an important financial measure for use in evaluating the Company’s financial performance. Free cash flow should be considered in addition to, rather than as a substitute for, consolidated net operating results as a measure of our performance and net cash provided by operating activities as a measure of our liquidity. Additionally, the Company’s definition of free cash flow is limited, in that it does not represent residual cash flows available for discretionary expenditures, due to the fact that the measure does not deduct the payments required for debt service and other contractual obligations or payments made for business acquisitions. Therefore, we believe it is important to view free cash flow as a measure that provides supplemental information to our condensed consolidated statements of cash flows.

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