Earnings Call Transcript - CREX Q4 2025

Operator, Operator

Good morning. At this time, I would like to welcome everyone to Creative Realities, Inc. 2025 Fourth Quarter Earnings Conference Call. This call will be recorded and a copy will be available on the company's website at cri.com following its completion. Creative Realities, Inc. has prepared remarks summarizing the interim results for the quarter along with additional industry and company updates. Joining the call today is Rick Mills, chief executive officer; Tamara Koshua, chief financial officer; and George Sautter, chief strategy officer and head of corporate development. Ms. Koshua, you may proceed.

Tamara Koshua, Chief Financial Officer

Thank you, and good morning, everyone. Welcome to our earnings call for the fourth quarter ended December 31, 2025. I would like to take this opportunity to remind you that remarks today will include forward-looking statements. The words anticipate, will, believes, expects, intends, plans, estimates, projects, should, may, propose, and similar expressions, and the negative versions of such words or expressions, as they relate to us or our management, are intended to identify forward-looking statements. Actual results may differ materially from those contemplated by these statements. Factors that could cause these results to differ materially are set forth in our Form 10-Ks and other filings with the SEC. Any forward-looking statements that we make on this call are based on assumptions as of today, and we undertake no obligation to update these statements as a result of new information or future events. During this call, we will present both GAAP and non-GAAP financial measures. We believe the use of certain non-GAAP measures, such as adjusted EBITDA and several important KPIs, represent meaningful ways to track our performance. A reconciliation of GAAP to non-GAAP measures is included in our public filings and in our earnings release that was issued this morning. It is now my pleasure to introduce Rick Mills, CEO of Creative Realities, Inc.

Rick Mills, Chief Executive Officer

Thanks, Tamara. Good morning, everybody. We appreciate everyone joining today's call. I would like to start by giving some highlights of our Q4 financials and other recent developments, including our integration of the CDM business which we acquired in November. Given the sizable nature of this transaction and the transformative impact it brings to Creative Realities, Inc., it should come as no surprise that it took longer than normal to close our books for the fourth quarter. But first, I would like to take a moment to introduce our new CFO, Tamara Koshua. Tamara joined our team on December 1 — I know the date because it happens to be my birthday — so, Tamara, welcome aboard. She brings tremendous experience to the organization: thirty years of executing financial strategies across diverse industries, including manufacturing, technology, and services. Her expertise and leadership credentials include a strong dedication to achieving a high level of performance and orchestrating operational turnarounds. We believe Tamara is uniquely qualified to take on the challenges of integrating CDM into Creative Realities, Inc., finding synergies across the enterprise, ensuring margin expansion, and ultimately deleveraging the balance sheet, which should improve returns for our shareholders. She brings tremendous energy, is driving organizational change, is implementing value-enhancing process improvements, and is working to increase our cash flow. She is off to a great start, and we are excited to have her on board. More recently, we have also added a couple other key executives. On March 30, we added Jackie Walker as our chief experience officer. Jackie is a veteran digital transformation leader with more than fifteen years’ experience designing, operating, and scaling enterprise digital platforms at the intersection of customer experience, product vision, and commercial outcomes. She brings a combination of technical execution and business acumen, having authored the digital menu board and drive-thru strategies for seven of the top ten restaurant brands and two of the largest in-store retail media networks in the U.S. Her appointment marks an important shift for Creative Realities, Inc. as the company continues its transition into a software-first platform powered by data analytics and artificial intelligence. Jackie will be instrumental for our next era of growth. She possesses a unique ability to bridge the gap between complex engineering and the strategic needs of the world's largest brands, and we are very pleased to have her here as well. With Jackie's addition and the prior addition of Dan McAllister as our CRO, this rounds out our management team with industry-leading veterans who have track records of accomplishment at a pivotal time in our history, as we relaunching ourselves as a much bigger, more technology-focused, service-oriented leader in the digital signage space. We believe we now have the talent at the top to accelerate growth, enhance our margin, and deliver improved bottom-line results going forward. A couple other facts of the business: this past February, we completed the repurchase of all of Slipstream's 1.7 million outstanding warrants for $200,000. The repurchase of these warrants provides greater visibility for the future in our total shares outstanding, which we believe benefits the company as well as our shareholders, alleviating potential overhang on the stock. We want to thank Slipstream for their support in finalizing this transaction. Now let us review a few details of our current results. Tamara will go over the financials in greater detail, but some of the highlights: we posted revenue of $23.9 million in Q4 versus $11 million in the prior-year period, including $13.6 million of that revenue from CDM. Our fourth quarter gross profit was $11.5 million as compared to $4.9 million in fiscal 2024, and our consolidated gross margin was 47.9% versus 44.2% in the prior-year period. This reflects both improved mix and the positive impact from CDM joining the company. In addition, as of December 31, 2025, we had an annual recurring revenue run rate, or ARR, of $20.1 million versus $12.3 million at the end of the third quarter. In addition, we have $4.1 million of SaaS under contract that will come online through the balance of this year and be added to the January 2027 SaaS total. Adjusted EBITDA was $5.2 million for the fourth quarter of 2025 versus $0.5 million last year and $0.8 million in the third quarter. And just as a reminder to everybody, we closed the transaction on November 7, so our Q4 includes two months of the CDM performance, not the full quarter. We anticipate both adjusted EBITDA and our ARR will increase going forward due to the synergies and additional opportunities in our pipeline. We have substantially integrated CDM operations into Creative Realities, Inc. and we are making significant progress towards our integration goals this year. As you may recall, acquiring CDM more than doubled the size of our company and significantly increased our market penetration in Canada. CDM serves thousands of quick-serve restaurants, financial institutions, and retail establishments across North America, and the acquisition strengthened our ability to address the growth in retail media networks literally coast to coast throughout North America. In addition, we now own Canada's largest mall retail media network. This digital out-of-home, or DOOH, media network has over 750 screens with exclusive representation and revenue sharing across 95 shopping destinations. These locations include 76 of the 100 most productive Canadian shopping centers and nine of the ten busiest malls in Canada, serving approximately 750 million shopper visits annually. As previously announced, we expect synergies of at least $10 million across North America on an annualized basis by the end of this year, reflecting the operating efficiencies, margin enhancement opportunities, and the cross-pollination of our CMS and AdTech platforms. At present, we are currently north of 60% of the goal, and we continue to anticipate total company revenue to exceed $100 million in 2026, with adjusted EBITDA margin percentage in the mid-teens. Once all synergies are realized, adjusted EBITDA margins are expected to be above 20%, and free cash flow generation should be significant, allowing us to pay down debt and deleverage the balance sheet once again as we have done in the past after acquisitions. With all our advancements, unique applications, strong customer relationships, and proprietary technology, we have built a strong foundation for a bright future at Creative Realities, Inc. We expect revenue to accelerate, our backlog to grow, and margins to improve as the year plays out, putting us on track for a record performance in fiscal 2026. I will come back in a minute to talk about specific product and customer trends, but I will now turn it over to Tamara to share some additional comments on our financials.

Tamara Koshua, Chief Financial Officer

Thanks, Rick. I am really excited to be part of the team during such an important time in our company's growth trajectory. An overview of our financial results for 2025 was provided in our earnings release and will be provided in our Form 10-Ks, which include the condensed consolidated balance sheet as of December 31, 2025, the statement of operations and cash flows for the three and twelve months ended December 31, 2025, and a detailed reconciliation of net income to EBITDA and adjusted EBITDA for the quarter ended December 31, 2025, as well as the preceding four quarters. While Rick reviewed our operating results briefly, let me provide more context related to our performance and outlook. In terms of the income statement, fourth quarter revenue more than doubled year over year to $23.9 million as compared to $11 million in the same period in fiscal 2024, with approximately $13.6 million from CDM. Revenue from our legacy Creative Realities, Inc. business decreased approximately 6% year over year, primarily as a result of project timing and decreased FAT. Hardware revenue rose to $6.6 million versus $3.9 million in the prior-year period, while service revenue increased to $17.3 million from $7.2 million in fiscal 2024, largely reflecting the CDM acquisition as well as deployment timing. Consolidated gross profit was $11.5 million for the fiscal 2025 fourth quarter versus $4.9 million in the prior-year period, and consolidated gross margin was 47.9% versus 44.2% in the fiscal 2024 fourth quarter. Gross margin on hardware revenue was 28% in 2025 as compared to 26.3% in the prior-year period, while gross margin on service amounted to 55.7% versus 53.9% in the fiscal 2024 fourth quarter, primarily due to an improved mix of services profit as a result of the CDM acquisition. Sales and marketing expenses in the fourth quarter rose to $2 million versus $1.4 million in the prior-year period, while general and administrative expenses increased to $8.9 million versus $4.2 million in fiscal 2024, again reflecting the acquisition of CDM which contributed approximately $3.2 million in expense. Approximately $1.2 million of G&A costs were one-time in nature, including legal, accounting, and consulting fees, as well as closing costs related to the transaction. As Rick indicated, we are well on our way to achieving the $10 million of synergies previously announced for fiscal 2026, although we are also investing in the Canadian media business and other technology initiatives meant to drive increased growth across the enterprise. The company posted operating income of approximately $0.5 million in 2025 compared to an operating loss of approximately $0.7 million in fiscal 2024. Creative Realities, Inc. reported a net loss of $1.9 million, or $0.19 per diluted share, in the quarter ended December 31, 2025, versus a net loss of $2.8 million, or $0.27 per diluted share, in the prior-year period. Adjusted EBITDA was $5.2 million in 2025 as compared to $0.5 million in the prior-year period. We anticipate adjusted EBITDA and cash flow to improve going forward as synergies are realized and, at the appropriate time, intend to reduce debt to decrease interest expense and strengthen our financial flexibility, as the company has done in the past. In terms of the balance sheet, as of December 31, 2025, the company had cash on hand of approximately $1.6 million versus $1 million at the start of 2025. As mentioned on prior earnings calls, we keep a minimum amount of cash in the bank as the company has set up a sweep instrument to apply funds against our revolving debt facility to better manage interest expense. Our gross and net debt stood at approximately $43.3 million and $41.7 million, respectively, at the end of the fourth quarter, as compared to $13 million and $12 million, respectively, at the start of 2025. The increase of our indebtedness is largely a result of financing the acquisition of CDM as previously discussed. As a reminder, we financed the transaction through a combination of debt and preferred equity, including a three-year $36 million senior syndicate term loan and $30 million of convertible preferred equity with a $3 conversion price provided by affiliates of North Run Capital. Going forward, as I just mentioned, we remain dedicated to using cash generation when possible to lower our debt and migrate to an optimized capital structure to support financial flexibility. However, in the near term, we are investing in the business to drive growth and improve technology applications across the organization. I will now turn it back to Rick for additional comments on the senior executive additions to the management team, reorganization of our sales team, some customer activities, and the CDM integration.

Rick Mills, Chief Executive Officer

Thanks, Tamara. I have already discussed Tamara's background and unique fit for our business earlier on the call, but I do want to spend a few more moments to introduce Dan McAllister as our CRO and Jackie Walker as our chief experience officer. Dan has been a chief revenue officer at a SaaS company before. He has a history of accelerating go-to-market strategy and reengineering the revenue systems for sustainable growth. His proven track record in aligning sales, marketing, and customer service teams, along with enforcing team structure and process discipline, all lead to revenue growth. The sales organization here has been structured into vertical teams, each led by a senior executive and focused on a vertical market. By the way, this is a team of 42 folks — a sales team that has effectively tripled in size. These vertical teams fall into the following markets: sports and entertainment (also known as IPTV), QSR and fast casual restaurants, retail and financial, retail media networks including AdTech, lottery, and finally, malls and real estate (known internally as MRE). We are now better focused and prepared to go after new customers across the board. More recently, Jackie Walker has joined as our new chief experience officer. She will serve as the internal authority on how digital and physical environments converge. She brings, and will leverage, an outsider's perspective to disrupt legacy thinking, overseeing the strategic what and why of our software revolution while scaling our consulting practice into a high-growth, high-margin engine of the business. Jackie, welcome aboard. Now there is a lot of activity and news to discuss across our various business vertical markets, so let us start with the IPTV division. We have been awarded a new stadium project, which will be completed in the second half of this year. This is a new stadium build from the ground up. This is an $8 million project involving thousands of displays and IPTV throughout the entire venue. In addition, we are in the process of refreshing the entire IPTV system for a Major League Baseball team and several other stadium projects. This division, which is headed by Lee Summers, is expected to double revenue this year to over $17 million. Our QSR and fast casual restaurant division is managed by Natalie Mines, a fifteen-year veteran of Creative Realities, Inc. Our next-gen modular drive-thru digital menu board system, which we introduced in January, is continuing to increase revenue in this division. This drive-thru, version 2.0, is engineered to help operators streamline installation, simplify maintenance, and scale the drive-thru environment over time. This new system allows brands to expand from single digital screen setups to multi-screen configurations without replacing the entire structure. We are currently deploying this product for multiple customers and typically are installing ten new locations on a weekly basis, or over 500 a year. The retail, financial, retail media network, and AdTech team, headed up by Jessica Creases, has been extremely busy since the acquisition. We had a nice jump start on the year by renewing the SaaS contracts of two of the top ten largest financial institutions in North America — congrats to the team for getting that done. Our AdTech solutions are now in test by a number of large customers who are evaluating the monetization capabilities of their installed signage network. We would expect to see three or four deployments in the second half of this year. Today, we are also announcing a $6 million media network project that Creative Realities, Inc. is deploying across the lobbies of AMC Theatres in the U.S. Our partner, National CineMedia (NCM), is the leading cinema platform in the U.S., and the media representative for this new innovative network. We will install this network of 1,200-plus screens and large-format LEDs through the rest of 2026. This media network utilizes the Reflect CMS and our AdLogic AdTech software solutions. One other customer-specific update I would like to mention: North Carolina Lottery. The previously announced ten-year $54 million contract is in the process of deployment and has been migrated to the ReflectView CMS platform. The deployment of all 1,550-plus locations is expected to be completed in Q2, with a few remaining locations in Q3. Finally, let us talk about the start of 2026. We had a significant revenue impact in Q1 from the disruptive weather across the Midwest and Southeast. A major cold wave gripped much of North America from mid-January through mid-February, bringing incredibly low temperatures, snow, sleet, and freezing rain to the eastern two-thirds of the country. In addition, a very rare storm brought historic snowfalls to the Carolinas, specifically North Carolina. This caused $4 million or more of revenue to push to Q2. I want to remind everybody, this is not lost revenue — however, just delayed. Construction on many of our customers' new QSR facilities was suspended for thirty to forty-five days as the weather passed through. As a result, the February and March new location openings for these QSR customers were delayed until April, May, and some in June, including the installation of 500 locations for our lottery customer. This will shift revenue from Q1 into Q2 and maybe some into Q3. With that said, I want to be very clear. We continue to be bullish on our revenue and stand behind our earlier statements that our revenue in 2026 will exceed $100 million and our adjusted EBITDA will reach a run rate of 20% by year-end. Our pipeline remains robust. We expect to continue to land many new opportunities. We are in an excellent position to post higher growth and improved operating results going forward, and we remain on track for our best year ever. We will now open the call for questions. Operator, please go ahead.

Operator, Operator

Thank you. To ask a question, please press 1-1 on your telephone and wait for your name to be announced. To withdraw your question, please press 1-1 again. Our first question comes from the line of Jason Michael Kreyer with Craig-Hallum. Your line is now open.

Jason Michael Kreyer, Analyst (Craig-Hallum)

Wonderful. Thank you, gentlemen. Rick, can you talk about scale gains and how that has changed the go-to-market over the last several months since the acquisition, or just maybe the tone of customer conversations and how that has changed?

Rick Mills, Chief Executive Officer

Great question, Jason. The tone of conversations is totally different. Number one, most customers recognize — particularly in some of our verticals, QSR specifically — we are absolutely at the top of the food chain, and so we are now in conversations that we would never have been in before. That is number one. Number two, those conversations are very serious because they understand we are now a true leader in the QSR and drive-thru space and approach us with a very different message than we experienced in the past.

Jason Michael Kreyer, Analyst (Craig-Hallum)

Good to hear. Thank you. Rick, we have talked for the last few quarters about deals that are sitting at the one-yard line — or I think you have even talked about the one-inch line. Any updates on that? I am also curious how you see the pipeline building with your AdTech capabilities. I know the last several wins that we have discussed have been more slanted to the QSR side, so I am curious how deal flow looks on deals that have advertising embedded in them.

Rick Mills, Chief Executive Officer

Deal flow continues to be strong. Let us go back to the one-inch-line comment. First thing I would tell you is, we pulled one across the one-inch line with an $8 million stadium project — finally got that done. Number two, we announced on a prior call a large QSR had gone through an entire RFP — over 4,000 locations in North America — and they had selected us. We have been negotiating the contract, and we expect to actually sign that contract in the next couple of weeks. It has been a long time coming, but the contract is getting ready to get executed, and that will result in additional drive-thrus, etc., moving along. Retail media networks: primarily, we have had a couple of C-store customers — one specific large C-store customer — that has been in test for at least five to six months and is now moving to deployment. We are in conversations with three or four other customers who are interested in retail media networks. One is a large grocer — one of the largest grocery chains in the U.S. — so we are in significant conversations. Another is a significant C-store chain. And I would say two or three what you would call traditional retailers that tend to be more in the luxury beauty area. We are having substantive conversations with a number of them. Last but not least, our sales force has literally tripled in size. We have 40-plus folks on the sales team who are out talking to customers every day. The number of folks we are actively engaged with has increased significantly. Part of that is due to our new position and stature in the industry — as one of the big guys. Number two, it is also the fact that I have 40-plus experienced folks out beating the streets, contacting customers every day across North America. A combination of all those things is really coming into play, and we feel very bullish about the next twelve to eighteen months.

Jason Michael Kreyer, Analyst (Craig-Hallum)

That was a solid recap there, Rick. Thank you for that. Last one for me: just want to touch on the lottery sector. I think the last time we talked, you have the big deployment right now in North Carolina, but I thought there was some potential momentum with other RFPs that were coming to market. Can you give us a recap of what you think that RFP landscape looks like today?

Rick Mills, Chief Executive Officer

That is a solid question, Jason. Unfortunately, I do not have a solid answer other than we expected in 2026 seven to eight large RFPs coming out. We have yet to see that happen. We have one that we are actively participating in. We have a couple large West Coast opportunities that we are in discussion on, but I would not call them active RFPs. We are well positioned and we are certainly talking to every lottery that is interested. One thing I would tell you about the lottery market and what we have done with our current lottery customer is we are showing significant lift, and we have results of that to show other lottery customers and potential customers — that we can achieve substantial lift which results in significantly increased lottery ticket sales.

Jason Michael Kreyer, Analyst (Craig-Hallum)

On that point, your ability to take that lottery solution into C-stores and create a cross-sell opportunity — does the rollout of lottery help build out a greater rollout in C-stores? Do you see a network effect there?

Rick Mills, Chief Executive Officer

Still unproven. Today, when we have rolled out lottery, it has been dedicated to lottery. We have not done a mix of in-store promotion and then layered in lottery, like a 50/50 mix. It has been 100% lottery. We are talking to some of our C-store customers who have networks already deployed about improving their schedule and adding lottery on those screens to increase lift, but we have no results yet to talk about.

Jason Michael Kreyer, Analyst (Craig-Hallum)

Got it. Thank you. Keep up the good work.

Rick Mills, Chief Executive Officer

Thanks.

Operator, Operator

Our next question comes from the line of Brian David Kinstlinger with Alliance Global Partners. Your line is now open.

Brian David Kinstlinger, Analyst (Alliance Global Partners)

Great. Thanks so much. Solid fourth quarter results. Prior to the announced partnership, had AMC been a customer of Creative Realities, Inc. or even CDM? If so, how much revenue did AMC generate last year? And then the second part of that question is, what is the installation revenue on this contract versus the potential recurring revenue based on your AdTech and media solution?

Rick Mills, Chief Executive Officer

Great question, Brian. How are you, sir?

Brian David Kinstlinger, Analyst (Alliance Global Partners)

Great. Thanks.

Rick Mills, Chief Executive Officer

Good. Yes, AMC has been a longtime customer of CDM. Today, I would tell you it is a seven-figure customer in terms of deploying our software and managing all of the screens throughout every AMC theatre in the U.S. They are not a hardware customer — they have always procured hardware internally — so they are a software and content customer. When the opportunity came to build out a network, it made sense that Creative Realities, Inc. was already deployed throughout their locations, and we were doing a great job, so it was a natural fit for us. In terms of the hardware and installation revenue on this particular network, I am assuming it is going to be in the typical 70/30 range of hardware and installation, out of the $6 million bucket. Then there is ongoing revenue: it is our software and AdTech that will be running it — our CMS and our AdTech — and there is a revenue share for the next five years on that screen.

Brian David Kinstlinger, Analyst (Alliance Global Partners)

Great. That is helpful and a great deal. This week, I think, 7-Eleven announced store restructuring where it is going to close something like 600 stores and open almost 300 stores over the course of maybe two years. Is there any impact on your business from the store closings? And then, you have been a preferred vendor there — will there be a new RFP, or is that under your existing contract? Just talk about 7-Eleven and what is going on there.

Rick Mills, Chief Executive Officer

Great question. If there is an effect on Creative Realities, Inc., it would be de minimis or minimal. The closing of the 600 stores — if those stores had digital, which we do not know — they may have us uninstall digital and reinstall it in some other stores. In the 300 new locations, those typically are going to be full-size 7-Elevens that are likely to include at least one if not two food concepts, and we would expect to do a number of screens there. Our contract with 7-Eleven is in the process of renewal. It has not been signed, but we are at the end game for another three-year renewal with 7-Eleven. We do not anticipate any change — that customer continues to grow.

Brian David Kinstlinger, Analyst (Alliance Global Partners)

You mentioned it was helpful that the first quarter was impacted by weather. Clearly, that is going to be the worst quarter of the year. Any thoughts on which are the strongest — maybe the second and the third quarter — based on known installs at places like AMC and North Carolina?

Rick Mills, Chief Executive Officer

I would tell you Q3 is setting up to be a significant quarter because, with the stadium install, a bunch of hardware will ship in Q3. A bunch of drive-thrus will go in during Q3 because that is the end of the construction timeframe across the eastern half of the U.S. They want to get those restaurants open in September–October, before it gets into bad weather. So, generally speaking, that is what we expect to be significant. Then we have this 4,000 locations across North America.

Tamara Koshua, Chief Financial Officer

The other thing that I will add is that Q4 has the largest percentage of our media revenue with the CDM acquisition, so that automatically will increase the value in Q4. We do expect Q4 to be the largest quarter of revenue.

Rick Mills, Chief Executive Officer

Great callout — I forgot that portion about a bunch of media revenue in Q4. Thank you.

Brian David Kinstlinger, Analyst (Alliance Global Partners)

Already adding value. Last question for me: remind us of the expectations for interest expense and how much is cash obligation this year?

Rick Mills, Chief Executive Officer

That is a great question. George or Tamara, any input on what that would look like?

Tamara Koshua, Chief Financial Officer

It will depend on the debt levels of the revolver, but generally, the term loan is going to drive the lion's share of the interest expense we would expect to see, and that generally is somewhere between $0.5 million and $0.75 million a quarter.

Brian David Kinstlinger, Analyst (Alliance Global Partners)

Thank you.

Rick Mills, Chief Executive Officer

Brian, happy to go through that in detail on our one-on-one call.

Brian David Kinstlinger, Analyst (Alliance Global Partners)

Great. Thank you, guys.

Operator, Operator

Our next question comes from the line of Jon Robert Hickman with Ladenburg. Your line is now open.

Jon Robert Hickman, Analyst (Ladenburg)

Hi. Can you hear me okay?

Rick Mills, Chief Executive Officer

I can hear you just fine, John.

Jon Robert Hickman, Analyst (Ladenburg)

Most of my questions have been asked and answered. I wanted to drill down a little bit on the restaurant chain that you landed last year, and then there were some issues with installation because of the size of the screens. Where are you with those guys? Did you do business with them in the fourth quarter, and what is going on?

Rick Mills, Chief Executive Officer

There was some SaaS revenue because we had some of their locations on our SaaS platforms. However, they have halted all hardware procurement and installs until the new contract was finalized. The new contract — we and the customer had internal dates to get it done by March 15. Here we are April 14, and we still do not have it signed. We do expect it to be signed in the next couple of weeks. We thought this was a brand-new win last year, and it is — they did an RFP, we won, and it is a contract that we had to create from the ground up.

Jon Robert Hickman, Analyst (Ladenburg)

There are a lot of franchisees in this particular customer. Has that been an issue?

Rick Mills, Chief Executive Officer

It has not been an issue as we have started to deploy the SaaS across the franchisees. The franchisees are responsible for hardware updates, and should they desire to upgrade to a digital drive-thru, they would be responsible for that. We attended the franchisee show in January. The verbal indications we received from the folks who came by our booth indicated significant interest. I have talked to two or three franchisees that own 30 to 50 locations each that indicated they wanted to put digital drive-thrus in all locations. As you know, we have to take that with a grain of salt, because when it is time to write the check, who knows. But we do expect to see some growth in Q3 because, even if they turned it on today, we would not be installing drive-thrus in the next sixty days — it would be Q3 or Q4 revenue once we sign this contract. That is realistically the impact.

Jon Robert Hickman, Analyst (Ladenburg)

Out of the total addressable market — not including the AdTech side — do you have any estimate of your market share right now?

Rick Mills, Chief Executive Officer

Really hard number to pin down. I would tell you in North America today, we are not 2%. If we were 1%, I would be surprised, at $100 million. George, any input?

George Sautter, Chief Strategy Officer & Head of Corporate Development

And, John, just to clarify, are we talking about market share or market penetration?

Jon Robert Hickman, Analyst (Ladenburg)

Maybe we can talk about both later today. Different question: now that you are combined with CDM and can get into a different level of contracts and opportunities, has your competitor outlook changed? Are the entities you are competing with different now?

Rick Mills, Chief Executive Officer

We have always competed against the same three, four, or five competitors. Some were larger than us. Today, they are not larger than us. We occupy a different, unique position, and in some cases I am significantly larger than they are. We represent a real strategic advantage for the end-user customer to align with Creative Realities, Inc. as a supplier.

Jon Robert Hickman, Analyst (Ladenburg)

That makes sense. I will talk to you later then. Thank you.

Operator, Operator

Our next question comes from the line of Kevin Sheldon, Private Investor. Your line is now open.

Rick Mills, Chief Executive Officer

Kevin, how are you?

Operator, Operator

Kevin, please check your mute button. I am currently showing no further questions from the phone lines. Mr. Sautter, are there any email questions?

George Sautter, Chief Strategy Officer & Head of Corporate Development

No. There are not.

Operator, Operator

Thank you. I would like to turn the call back over to Rick Mills for closing remarks.

Rick Mills, Chief Executive Officer

Let me conclude the call by thanking all our shareholders, clients, partners, and specifically the Creative Realities, Inc. and CDM employees for their continuing efforts, commitment, and support. We continue to work to transform Creative Realities, Inc. into the leading brand in digital signage solutions, and for many of you who have been on these calls for the last couple of years, you have seen us really execute in the market and continue to grow. Thanks for joining the call. We look forward to speaking with you again next quarter.

Operator, Operator

This concludes today's conference. Thank you for your participation. You may now disconnect.