CPI Card Group Inc 10-Q for FY2025 Q3

CPI Card Group Inc. (PMTS)

10-Q 2025-11-04 For: 2025-09-30

Added on April 10, 2026

About this 10-Q

CPI Card Group Inc filed this 10-Q on November 4, 2025, covering the quarter ended September 30, 2025 (FY2025 Q3).

Headline figures

Quarter ended September 30, 2025, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $137.97M; up 10.6% from $124.75M a year earlier
Net income: $2.31M; up 78.5% from net income of $1.29M a year earlier
Diluted EPS: $0.19; up 72.7% from $0.11 a year earlier

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Delaware		26-0344657
(State or other jurisdiction of incorporation or organization)		(I.R.S. employer identification no.)

10368 W. Centennial Road
Littleton, CO		80127
(Address of principal executive offices)		(Zip Code)


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.001 par value	PMTS	Nasdaq Global Market



Large accelerated filer	☐	Accelerated filer	☒

Non-accelerated filer	☐	Smaller reporting company	☒

		Emerging growth company	☐


		Page
Part I — Financial Information

Item 1 — Condensed Consolidated Financial Statements (Unaudited)		3

Item 2 — Management’s Discussion and Analysis of Financial Condition and Results of Operations		20

Item 3 — Quantitative and Qualitative Disclosures About Market Risk		28

Item 4 — Controls and Procedures		28

Part II — Other Information

Item 1 — Legal Proceedings		29

Item 1A — Risk Factors		29

Item 2 — Unregistered Sales of Equity Securities and Use of Proceeds		29

Item 3 — Defaults Upon Senior Securities		29

Item 4 — Mine Safety Disclosures		29

Item 5 — Other Information		29

Item 6 — Exhibits		30

Signatures		31


	September 30,		December 31,
	2025		2024
Assets
Current assets:
Cash and cash equivalents	$	15,955	$	33,544
Accounts receivable, net		90,773		85,491
Inventories, net		85,128		72,660
Prepaid expenses and other current assets		19,487		11,347
Total current assets		211,343		203,042
Plant, equipment, leasehold improvements and operating lease right-of-use assets, net		106,303		68,648
Intangible assets, net of accumulated amortization of $58,540 and $55,393, respectively		19,744		10,492
Goodwill		50,648		47,150
Other assets		19,022		20,325
Total assets	$	407,060	$	349,657
Liabilities and stockholders’ deficit
Current liabilities:
Accounts payable	$	29,387	$	16,123
Accrued expenses		49,465		57,979
Deferred revenue and customer deposits		3,602		1,485
Total current liabilities		82,454		75,587
Long-term debt		308,433		280,405
Deferred income taxes		3,224		3,318
Other long-term liabilities		38,608		25,968
Total liabilities		432,719		385,278

Commitments and contingencies (Note 12)

Stockholders’ deficit:
Series A Preferred Stock; $0.001 par value—100,000 shares authorized; 0 shares issued and outstanding at September 30, 2025 and December 31, 2024		—		—
Common stock; $0.001 par value—100,000,000 shares authorized; 11,387,538 and 11,240,507 shares issued and outstanding at September 30, 2025 and December 31, 2024, respectively		11		11
Capital deficit		(103,067)		(105,429)
Accumulated earnings		77,397		69,797
Total stockholders’ deficit		(25,659)		(35,621)
Total liabilities and stockholders’ deficit	$	407,060	$	349,657


	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Net sales:
Products	$	84,453	$	69,648	$	234,578	$	191,650
Services		53,513		55,103		155,902		163,855
Total net sales		137,966		124,751		390,480		355,505
Cost of sales:
Products (exclusive of depreciation and amortization shown below)		59,161		44,199		160,424		123,894
Services (exclusive of depreciation and amortization shown below)		33,201		32,927		96,377		94,599
Depreciation and amortization		4,611		2,927		11,870		8,408
Total cost of sales		96,973		80,053		268,671		226,901
Gross profit		40,993		44,698		121,809		128,604
Operating expenses:
Selling, general and administrative (exclusive of depreciation and amortization shown below)		26,471		25,674		81,257		77,942
Depreciation and amortization		1,504		1,226		4,007		3,810
Total operating expenses		27,975		26,900		85,264		81,752
Income from operations		13,018		17,798		36,545		46,852
Other expense, net:
Interest, net		(8,746)		(13,458)		(24,500)		(26,413)
Loss on debt extinguishment		(287)		(2,987)		(287)		(2,987)
Other expense, net		(242)		(534)		(237)		(677)
Total other expense, net		(9,275)		(16,979)		(25,024)		(30,077)
Income before income taxes		3,743		819		11,521		16,775
Income tax (expense) benefit		(1,435)		474		(3,921)		(4,026)
Net income	$	2,308	$	1,293	$	7,600	$	12,749

Basic and diluted earnings per share:
Basic earnings per share	$	0.20	$	0.12	$	0.67	$	1.14
Diluted earnings per share	$	0.19	$	0.11	$	0.64	$	1.08

Basic weighted-average shares outstanding		11,353,329		11,107,126		11,298,986		11,141,264
Diluted weighted-average shares outstanding		11,853,630		11,872,783		11,937,369		11,856,404

Comprehensive income:
Net income	$	2,308	$	1,293	$	7,600	$	12,749
Total comprehensive income	$	2,308	$	1,293	$	7,600	$	12,749


	Common stock			Capital		Accumulated		Stockholders
	Shares	Amount		deficit		earnings		deficit
June 30, 2025	11,334,910	$	11	$	(104,126)	$	75,089	$	(29,026)
Shares issued under stock-based compensation plans	52,628		—		(423)		—		(423)
Stock-based compensation	—		—		1,482		—		1,482
Components of comprehensive income:
Net income	—		—		—		2,308		2,308
September 30, 2025	11,387,538	$	11	$	(103,067)	$	77,397	$	(25,659)


	Common stock			Capital		Accumulated		Stockholders
	Shares	Amount		deficit		earnings		deficit
December 31, 2024	11,240,507	$	11	$	(105,429)	$	69,797	$	(35,621)
Shares issued under stock-based compensation plans	147,031		—		(1,500)		—		(1,500)
Stock-based compensation	—		—		3,862		—		3,862
Components of comprehensive income:
Net income	—		—		—		7,600		7,600
September 30, 2025	11,387,538	$	11	$	(103,067)	$	77,397	$	(25,659)


	Common stock			Capital		Accumulated		Stockholders
	Shares	Amount		deficit		earnings		deficit
June 30, 2024	11,186,596	$	11	$	(106,300)	$	61,732	$	(44,557)
Shares issued under stock-based compensation plans	93,356		—		(1,309)		—		(1,309)
Stock-based compensation	—		—		1,782		—		1,782
Repurchase and retirement of common shares	(120,534)		—		—		—		—
Components of comprehensive income:
Net income	—		—		—		1,293		1,293
September 30, 2024	11,159,418	$	11	$	(105,827)	$	63,025	$	(42,791)


	Common stock			Capital		Accumulated		Stockholders
	Shares	Amount		deficit		earnings		deficit
December 31, 2023	11,446,155	$	11	$	(102,223)	$	50,276	$	(51,936)
Shares issued under stock-based compensation plans	186,547		—		(2,595)		—		(2,595)
Stock-based compensation	—		—		6,936		—		6,936
Repurchase and retirement of common shares	(473,284)		—		(7,945)		—		(7,945)
Components of comprehensive income:
Net income	—		—		—		12,749		12,749
September 30, 2024	11,159,418	$	11	$	(105,827)	$	63,025	$	(42,791)


Cash and cash equivalents	$	1,603
Accounts receivable		9,424
Inventories		3,992
Prepaid expenses and other current assets		2,517
Plant, equipment, leasehold improvements and operating lease right-of-use assets		17,563
Intangible assets		12,400
Goodwill		3,498
Deferred income taxes		3,699
Other assets		298
Total assets		54,994
Accounts payable		2,837
Accrued expenses		3,986
Accrued long-term operating leases		2,371
Total purchase price	$	45,800


	Weighted Average
	Life (Years)
Trademark	2.5	$	600
Acquired technology	7.0		4,400
Customer relationships	15.0		7,400
Total identifiable intangible assets acquired		$	12,400


	Carrying		Estimated
	Value as of		Fair Value as of		Fair Value Measurement at September 30, 2025
	September 30,		September 30,		(Using Fair Value Hierarchy)
	2025		2025		Level 1		Level 2		Level 3
Liabilities:
Senior Notes	$	265,000	$	278,780	$	—	$	278,780	$	—
ABL Revolver	$	47,000	$	47,000	$	—	$	47,000	$	—


	Three Months Ended September 30, 2025
	Debit and Credit		Prepaid Debit		Other		Intersegment Eliminations		Total
Net sales
Products	$	85,072	$	—	$	—	$	(619)	$	84,453
Services		30,200		23,335		—		(22)		53,513
Total net sales		115,272		23,335		—		(641)		137,966
Cost of sales
Products ⁽¹⁾		59,780		—		—		(619)		59,161
Services ⁽¹⁾		18,012		15,211		—		(22)		33,201
Depreciation and amortization		3,536		1,075		—		—		4,611
Total cost of sales		81,328		16,286		—		(641)		96,973
Gross profit		33,944		7,049		—		—		40,993
Operating expenses		12,667		1,166		14,142		—		27,975
Income (loss) from operations	$	21,277	$	5,883	$	(14,142)	$	—	$	13,018

EBITDA by segment:
Income (loss) from operations	$	21,277	$	5,883	$	(14,142)	$	—	$	13,018
Depreciation and amortization		4,113		1,134		868		—		6,115
Other expense		(238)		(1)		(290)		—		(529)
EBITDA	$	25,152	$	7,016	$	(13,564)	$	—	$	18,604

Gross profit margin		29.4%		30.2%		*		*		29.7%
EBITDA margin		21.8%		30.1%		*		*		13.5%


	Nine Months Ended September 30, 2025
	Debit and Credit		Prepaid Debit		Other		Intersegment Eliminations		Total
Net sales
Products	$	235,873	$	—	$	—	$	(1,295)	$	234,578
Services		86,676		69,270		—		(44)		155,902
Total net sales		322,549		69,270		—		(1,339)		390,480
Cost of sales
Products ⁽¹⁾		161,719		—		—		(1,295)		160,424
Services ⁽¹⁾		52,305		44,116		—		(44)		96,377
Depreciation and amortization		8,678		3,192		—		—		11,870
Total cost of sales		222,702		47,308		—		(1,339)		268,671
Gross profit		99,847		21,962		—		—		121,809
Operating expenses		33,814		3,909		47,541		—		85,264
Income (loss) from operations	$	66,033	$	18,053	$	(47,541)	$	—	$	36,545

EBITDA by segment:
Income (loss) from operations	$	66,033	$	18,053	$	(47,541)	$	—	$	36,545
Depreciation and amortization		9,912		3,376		2,589		—		15,877
Other (expense) income		(278)		5		(251)		—		(524)
EBITDA	$	75,667	$	21,434	$	(45,203)	$	—	$	51,898

Gross profit margin		31.0%		31.7%		*		*		31.2%
EBITDA margin		23.5%		30.9%		*		*		13.3%


	Three Months Ended September 30, 2024
	Debit and Credit		Prepaid Debit		Other		Intersegment Eliminations		Total
Net sales
Products	$	69,803	$	—	$	—	$	(155)	$	69,648
Services		29,952		25,173		—		(22)		55,103
Total net sales		99,755		25,173		—		(177)		124,751
Cost of sales
Products ⁽¹⁾		44,354		—		—		(155)		44,199
Services ⁽¹⁾		17,342		15,607		—		(22)		32,927
Depreciation and amortization		1,928		999		—		—		2,927
Total cost of sales		63,624		16,606		—		(177)		80,053
Gross profit		36,131		8,567		—		—		44,698
Operating expenses		9,096		1,456		16,348		—		26,900
Income (loss) from operations	$	27,035	$	7,111	$	(16,348)	$	—	$	17,798

EBITDA by segment:
Income (loss) from operations	$	27,035	$	7,111	$	(16,348)	$	—	$	17,798
Depreciation and amortization		2,198		1,061		894		—		4,153
Other income (expense)		31		(1)		(3,551)		—		(3,521)
EBITDA	$	29,264	$	8,171	$	(19,005)	$	—	$	18,430

Gross profit margin		36.2%		34.0%		*		*		35.8%
EBITDA margin		29.3%		32.5%		*		*		14.8%


	Nine Months Ended September 30, 2024
	Debit and Credit		Prepaid Debit		Other		Intersegment Eliminations		Total
Net sales
Products	$	192,636	$	—	$	—	$	(986)	$	191,650
Services		90,712		73,186		—		(43)		163,855
Total net sales		283,348		73,186		—		(1,029)		355,505
Cost of sales
Products ⁽¹⁾		124,880		—		—		(986)		123,894
Services ⁽¹⁾		50,921		43,721		—		(43)		94,599
Depreciation and amortization		5,757		2,651		—		—		8,408
Total cost of sales		181,558		46,372		—		(1,029)		226,901
Gross profit		101,790		26,814		—		—		128,604
Operating expenses		26,612		4,049		51,091		—		81,752
Income (loss) from operations	$	75,178	$	22,765	$	(51,091)	$	—	$	46,852

EBITDA by segment:
Income (loss) from operations	$	75,178	$	22,765	$	(51,091)	$	—	$	46,852
Depreciation and amortization		6,585		2,827		2,806		—		12,218
Other expense		(32)		(3)		(3,629)		—		(3,664)
EBITDA	$	81,731	$	25,589	$	(51,914)	$	—	$	55,406

Gross profit margin		35.9%		36.6%		*		*		36.2%
EBITDA margin		28.8%		35.0%		*		*		15.6%


Exhibit Number		Exhibit Description
31.1		Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2		Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1		Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2		Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS		XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH		Inline XBRL Taxonomy Extension Schema Document.
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document.
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document.
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).


	Nine Months Ended September 30,
	2025		2024
Operating activities
Net income	$	7,600	$	12,749
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation expense		12,730		9,448
Amortization expense		3,147		2,770
Stock-based compensation expense		4,537		6,936
Amortization of debt issuance costs		983		1,206
Loss on early extinguishment of debt		887		8,763
Deferred income taxes and other, net		4,245		(1,781)
Changes in operating assets and liabilities:
Accounts receivable, net		4,150		(5,878)
Inventories		(9,126)		(21,964)
Prepaid expenses and other assets		1,177		(19,343)
Income taxes, net		(5,178)		(602)
Accounts payable		8,834		8,326
Accrued expenses and other liabilities		(16,192)		15,396
Deferred revenue and customer deposits		2,117		626
Cash provided by operating activities		19,911		16,652
Investing activities
Capital expenditures for plant, equipment and leasehold improvements, net		(13,777)		(4,199)
Cash paid for acquisition, net of cash acquired		(42,442)		—
Other		50		1
Cash used in investing activities		(56,169)		(4,198)
Financing activities
Proceeds from borrowings on debt		67,000		293,000
Payments on debt		(40,000)		(275,897)
Payments on finance leases and other obligations		(5,967)		(3,688)
Common stock repurchased		—		(8,678)
Debt issuance costs		(264)		(6,583)
Payment for debt early redemption premium		(600)		(5,776)
Taxes withheld and paid on stock-based compensation awards		(1,500)		(2,595)
Cash provided by (used in) financing activities		18,669		(10,217)
Net (decrease) increase in cash and cash equivalents		(17,589)		2,237
Cash and cash equivalents, beginning of period		33,544		12,413
Cash and cash equivalents, end of period	$	15,955	$	14,650
Supplemental disclosures of cash flow information
Cash paid (refunded) during the period for:


		September 30,		December 31,
		2025		2024
Trade accounts receivable	$	91,019	$	78,464
Unbilled accounts receivable		—		7,213
		91,019		85,677
Less allowance for credit losses		(246)		(186)
Total accounts receivable, net	$	90,773	$	85,491


		September 30,		December 31,
		2025		2024
Raw materials	$	72,876	$	63,863
Work in process		5,205		955
Finished goods		7,047		7,842
Total inventories, net	$	85,128	$	72,660


	September 30,		December 31,
	2025		2024
Accrued payroll and related employee expenses	$	11,680	$	9,493
Accrued employee performance-based incentive compensation		1,993		4,664
Employer payroll taxes		1,445		868
Accrued rebates		4,669		3,956
Capitalized contract costs payable		—		8,000
Accrued interest		6,365		13,506
Current operating and financing lease liabilities		12,304		9,065
Income taxes payable		9		881
Other		11,000		7,546
Total accrued expenses	$	49,465	$	57,979



	CPI CARD GROUP INC.
November 4, 2025	/s/ John Lowe
	John Lowe
	President and Chief Executive Officer
	(Principal Executive Officer)

November 4, 2025	/s/ Jeffrey Hochstadt
	Jeffrey Hochstadt
	Chief Financial Officer
	(Principal Financial Officer)

November 4, 2025	/s/ Donna Abbey Carmignani
	Donna Abbey Carmignani
	Chief Accounting Officer
	(Principal Accounting Officer)