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UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: March 31, 2025 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______________ to _______________. Commission file number: 0-21121 TRANSACT TECHNOLOGIES INC (Exact name of registrant as specified in its charter) | Delawa ...

TransAct Technologies (TACT) Q1 2025 Earnings Call May 13, 2025 04:30 PM ET Speaker0 As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Ryan Gardella, Investor Relations. Please go ahead, sir. Speaker1 Thank you. Good afternoon. Welcome to the TransAct Technologies First Quarter twenty twenty five Earnings Call. Today, we'll be discussing the results announced in our press release issued after market close. Joining us from the company is CEO, John Di ...

Exhibit 99.1 TransAct Technologies Reports Preliminary First Quarter 2025 Financial Results Sold Over 2,300 Terminals in the First Quarter 2025, An All-Time Quarterly High Total FST Revenue Up 49% Year-Over-Year Quarterly Casino and Gaming Sales Up 18% Year-Over-Year and 41% Sequentially Hamden, CT –May 13, 2025 – TransAct Technologies Incorporated (Nasdaq: TACT) ("TransAct" or the "Company"), a global leader in software-driven technology and printing solutions for high-growth markets, today reported prelim ...

Strategic Initiatives - TransAct Technologies reported a focus on strategic review processes aimed at increasing stockholder value, with no specific outcomes guaranteed [19]. - The company launched the BOHA! Terminal 2 and the Epic TR80 in 2023, continuing its strategy of developing new products to enhance market penetration [42]. Product Development - The company launched the BOHA! Terminal 2 in May 2023, targeting enterprise customers with enhanced speed and print resolution, receiving orders in late 2023 [22]. - In Q4 2023, TransAct introduced the Epic TR80 casino and gaming printer, designed to expand its customer base in the gaming market [24]. - The BOHA! product suite generates recurring revenue through software subscriptions, label sales, and service contracts, with annual charges typically applied per application [22]. Manufacturing and Supply Chain - TransAct's printers and terminals are primarily manufactured in Thailand, with a small portion assembled in Ithaca, New York, to optimize performance and reliability [28]. - The company relies on third-party manufacturers for a significant portion of its production, which poses risks related to supply chain disruptions and component availability [29]. - The company emphasizes the importance of maintaining multiple sources for component parts to mitigate risks associated with supply shortages [29]. - The company’s strategy includes sourcing certain products overseas to lower costs, which may impact pricing competitiveness [42]. Market Position and Competition - The market for transaction-based and specialty printers is highly competitive, with significant competition from companies with greater financial resources [37]. - Sales to Light & Wonder represented 11% and 6% of total net sales for the years ended December 31, 2024 and 2023, respectively [36]. Technology and Innovation - The company holds 23 active U.S. patents and 39 active foreign patents, with additional applications pending, ensuring protection of proprietary technologies [31]. - Certain food service technology software is licensed from a third-party developer through 2031, indicating reliance on external partnerships for product development [38]. - The company’s printer products utilize thermal printing technologies and licensed software, making them vulnerable to technological advancements by competitors [43]. Regulatory and Operational Risks - The company faces regulatory scrutiny in the casino and gaming industries, which could materially affect operations if licenses are not obtained or maintained [44]. Workforce and Management - The company employs 108 full-time employees as of December 31, 2024, with no unionized workforce [48]. - The company has a diverse executive team with extensive experience in technology and finance, enhancing its operational capabilities [50][51][52][53][54]. Financial Reporting - The company is classified as a smaller reporting company and is not required to provide certain market risk disclosures [219].

Financial Data and Key Metrics Changes - Total revenue for Q4 2024 was $10.2 million, down 23% from $13.3 million in Q4 2023 [35] - Full year 2024 net sales were $43.4 million, a decrease of 40% compared to $72.6 million in 2023 [35] - Gross margin for Q4 2024 was 44.2%, down from 48% in the prior year [42] - Full year gross margin was 49.5%, compared to 52.9% in 2023 [42] - Net loss for Q4 2024 was $8 million or $0.79 per diluted share, compared to a net loss of $62,000 or $0.01 per share in the year-ago period [55] Business Line Data and Key Metrics Changes - Food Service Technology (FST) revenue for Q4 was $4.3 million, approximately flat sequentially but down 9% year-over-year [36] - FST recurring revenue for the year was $10.8 million, down about 3% compared to 2023 [37] - Casino and gaming revenue for Q4 was $4.8 million, up 14% year-over-year [38] - POS automation sales for Q4 decreased 74% year-over-year to $411,000 [39] - TransAct Services Group (TSG) sales for Q4 were $759,000, down 73% from the prior year [41] Market Data and Key Metrics Changes - The casino and gaming market is showing signs of recovery, with all major domestic OEM partners back in buying positions [19][70] - The international side of the casino and gaming market is expected to strengthen, with some OEMs still working through inventory [71] Company Strategy and Development Direction - The company is focused on maximizing shareholder value through a strategic review process initiated in Q4 2023 [26] - The management team is considering all options to enhance shareholder value, indicating a proactive approach to potential partnerships or strategic events [29] - The company aims to continue improving its go-to-market strategies and internal sales motions to drive growth [9] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the momentum in terminal placements, expecting continued upward trends throughout 2025 [10] - The company anticipates total revenue for 2025 to be between $47 million and $52 million, with adjusted EBITDA expected to range from breakeven to a negative $2 million [30] - Management acknowledged the complexities of operating two distinct business lines and the challenges in evaluating their respective market opportunities [79] Other Important Information - The company completed the rollout of the Epic TR80 thermal roll printer, which is expected to fuel additional sales in the casino and gaming sector [20] - The company has a solid balance sheet, finishing the year with $14.4 million in cash, up from $2.1 million at the end of 2023 [57] Q&A Session Summary Question: How much of the FS terminal installations in the quarter were from the large QSR customer? - The large QSR customer contributed a decent chunk of the installations, but it was not more than half [63] Question: What is the outlook for the casino and gaming segment in 2025? - The company expects a stronger year in 2025 for both domestic and international markets [71] Question: What complexities are involved in the strategic review process? - The complexity arises from managing two different business lines and the need to evaluate their respective market opportunities [79]

TransAct Technologies Incorporated (NASDAQ:TACT) Q4 2024 Earnings Conference Call March 13, 2025 4:30 PM ET Company Participants Ryan Gardella - IR John Dillon - CEO Steve DeMartino - President and CFO Conference Call Participants Jeff Martin - Roth Capital Partners George Sutton - Craig Hallum Operator Greetings, and welcome to the TransAct Technologies Fourth Quarter 2024 Earnings Call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal pre ...

Company Performance - TransAct Technologies Incorporated (TACT) reported a quarterly loss of $0.06 per share, better than the Zacks Consensus Estimate of a loss of $0.10, representing an earnings surprise of 40% [1] - The company posted revenues of $10.23 million for the quarter ended December 2024, missing the Zacks Consensus Estimate by 3.93%, and down from $13.27 million year-over-year [2] - Over the last four quarters, the company has surpassed consensus EPS estimates four times but has topped consensus revenue estimates only once [2] Stock Outlook - TransAct Technologies shares have declined approximately 11.3% since the beginning of the year, compared to a decline of 4.8% for the S&P 500 [3] - The current consensus EPS estimate for the upcoming quarter is -$0.06 on revenues of $11.28 million, and for the current fiscal year, it is -$0.17 on revenues of $47.95 million [7] - The estimate revisions trend for TransAct Technologies is mixed, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market [6] Industry Context - The Computer - Peripheral Equipment industry, to which TransAct Technologies belongs, is currently in the top 35% of over 250 Zacks industries, suggesting a favorable industry outlook [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Financial Performance - Net sales for Q4 2024 were $10.2 million, down 6% sequentially and down 23% compared to $13.3 million in Q4 2023[3] - FST recurring revenue for Q4 2024 was $2.7 million, down 5% sequentially and 15% compared to $3.2 million in Q4 2023[3] - Gross profit for Q4 2024 was $4.5 million, resulting in a gross margin of 44.2%, compared to a gross profit of $6.4 million and a 48.0% gross margin in Q4 2023[3] - Full year 2024 net sales were $43.4 million, down 40% from $72.6 million in 2023[6] - Full year 2024 net loss was $(9.9) million, or $(0.99) per diluted share, compared to a net income of $4.7 million, or $0.47 per diluted share in 2023[6] - Adjusted EBITDA for Q4 2024 was negative $(705) thousand, compared to positive $587 thousand in Q4 2023[6] - The operating loss for Q4 2024 was $(1,050,000), compared to an operating loss of $(522,000) in Q4 2023[22] - Net loss for Q4 2024 was $(7,957,000), significantly higher than the net loss of $(62,000) in Q4 2023[22] - For the year ended December 31, 2024, the net loss was reported at $(9,863) million, compared to a net income of $4,748 million for 2023[31] - Adjusted EBITDA for the year ended December 31, 2023, was $9,968 million, while the adjusted EBITDA for 2024 was $(1,521) million[31] Assets and Liabilities - Total assets decreased to $44,034,000 as of December 31, 2024, down from $54,198,000 as of December 31, 2023[26] - Total liabilities decreased to $13,401,000 as of December 31, 2024, from $14,784,000 as of December 31, 2023[26] - The company reported a full valuation allowance on deferred tax assets amounting to $7,313,000 in Q4 2024[27] Future Outlook - The company expects full year 2025 net sales to be between $47 million and $52 million[6] - The company anticipates 2025 to be an inflection point with decreasing net losses as overall revenue returns to growth[2] - The strategic review process remains active, focusing on options to increase shareholder value[7] - The company plans to focus on developing new products and expanding its market presence despite current economic challenges[22] Operating Expenses - The company’s operating expenses for the year ended December 31, 2024, were $25,108,000, representing 57.9% of net sales[29] - Operating expenses for the year were $32,694 million, representing 45.0% of net sales, while adjusted operating expenses were $31,233 million, or 43.0% of net sales[30] - The company incurred a severance charge of $1,461 million related to the resignation of the former CEO, impacting the income tax expense by $(303) million[30] Income Tax and Other Income - The company experienced a significant increase in income tax expense from $1,155 million in 2023 to $6,295 million in 2024[31] - Interest and other income for the year was $197 million, with no adjustments made[30] Shareholder Returns - The company reported a basic net income per common share of $0.48 and a diluted net income per common share of $0.47 for the year ended December 31, 2023[30]

Financial Performance - Net sales for the three months ended September 30, 2024, were $10,867 thousand, a decrease of 36.5% compared to $17,190 thousand for the same period in 2023[8]. - Gross profit for the nine months ended September 30, 2024, was $16,961 thousand, down 47.1% from $32,029 thousand in the same period of 2023[8]. - Operating loss for the three months ended September 30, 2024, was $(837) thousand, compared to an operating income of $1,191 thousand for the same period in 2023[8]. - Net loss for the nine months ended September 30, 2024, was $(1,906) thousand, a significant decline from a net income of $4,810 thousand in the same period of 2023[9]. - Basic net loss per common share for the three months ended September 30, 2024, was $(0.06), compared to earnings of $0.09 per share for the same period in 2023[8]. - The company reported a comprehensive loss of $(504) thousand for the three months ended September 30, 2024, compared to a comprehensive income of $871 thousand for the same period in 2023[9]. - Operating loss for Q3 2024 was $(837) thousand, a decrease of $2.0 million, or 170%, compared to an operating income of $1.191 million in Q3 2023, driven by a 37% decline in sales[83]. - The company reported a net loss of $(551) thousand for the three months ended September 30, 2024, compared to a net income of $906 thousand in the same period last year[9]. - Gross profit for Q3 2024 was $5.227 million, a 41.4% decrease from $8.916 million in Q3 2023, with gross margin declining to 48.1%[79]. Sales and Market Trends - Revenue from the casino and gaming segment for the three months ended September 30, 2024, is $4,534,000, down from $9,019,000 in 2023, a decrease of approximately 49.7%[27]. - Total net sales for the nine months ended September 30, 2024, were $33.153 million, compared to $59.366 million for the same period in 2023, representing a decrease of approximately 44%[28]. - Net sales for Q3 2024 decreased by $6.3 million, or 37%, compared to Q3 2023, with a significant decline in the casino and gaming market by 49.7%[64]. - Printer, terminal, and other hardware unit sales volume decreased by 38% to approximately 21,000 units, primarily due to a 50% decrease in the casino and gaming market[65]. - International sales for Q3 2024 decreased by $1.8 million, or 44%, primarily due to lower sales in the casino and gaming market[66]. - Domestic casino and gaming product sales decreased by $17.3 million, or 65%, for the first nine months of 2024 compared to the same period in 2023, primarily due to high inventory levels among customers and a slowdown in orders[96]. - International casino and gaming product sales fell by $4.1 million, or 39%, in the first nine months of 2024, reflecting similar inventory issues and reduced demand[97]. - The company experienced a slowdown in demand in the casino and gaming market due to customers reducing orders until their inventory normalizes[16]. - The primary competitor in the casino and gaming market has resumed product supply, leading to downward pricing pressure[16]. Cost Management and Savings Initiatives - The company expects to achieve approximately $3 million in annualized savings from cost reduction initiatives initiated in Q3 2023[17]. - An additional cost reduction initiative in Q2 2024 is expected to yield approximately $2 million in annualized savings[18]. - Engineering, design, and product development expenses decreased by 34.6% in Q3 2024, reflecting cost reduction initiatives[80]. - Selling and marketing expenses decreased by $517 thousand, or 22%, in Q3 2024 compared to Q3 2023, primarily due to cost reduction initiatives[81]. - General and administrative expenses decreased by $275 thousand, or 10%, in Q3 2024 compared to Q3 2023, attributed to lower bad debt and incentive compensation expenses[82]. Liquidity and Financial Position - Cash and cash equivalents at the end of the period were $11,343 thousand, a decrease from $11,605 thousand at the end of the same period in 2023[11]. - The company believes it has sufficient liquidity to fund current obligations and capital spending for at least the next 12 months[19]. - The company had $2.3 million of outstanding borrowings under the Siena Credit Facility as of September 30, 2024, with a net borrowing capacity of $4.2 million[36]. - The Siena Credit Facility was extended to March 13, 2025, allowing for continued access to a revolving credit line of up to $10.0 million[120]. - The company maintained compliance with the excess availability covenant of at least $750 thousand under the Siena Credit Facility since July 31, 2021[118]. - The company continues to monitor cash generation and evaluate alternative funding sources as necessary[121]. Inventory and Contract Liabilities - Total inventories as of September 30, 2024, were $16.851 million, a slight decrease from $17.759 million as of December 31, 2023[33]. - As of September 30, 2024, total net contract liabilities were $(1.002) million, down from $(1.178) million as of December 31, 2023[31]. - The company recognized revenue of $0.9 million related to contract liabilities for the nine months ended September 30, 2024[30]. - Remaining performance obligations amounted to $3.0 million as of September 30, 2024, with expected revenue recognition of $2.7 million within the next 12 months[32]. Tax and Lease Information - The effective tax rate for the third quarter of 2024 was (21.2%), with an income tax benefit of $148 thousand, compared to an expense of $169 thousand at a rate of 15.7% in the third quarter of 2023[49]. - Operating lease expense for the nine months ended September 30, 2024, was $759 thousand, compared to $742 thousand for the same period in 2023[45]. - The weighted average remaining lease term as of September 30, 2024, was 1.5 years, with a weighted average discount rate of 7.5%[47]. - The total undiscounted lease payments decreased from $1.720 million as of December 31, 2023, to $1.514 million as of September 30, 2024[48].