Usio Inc (USIO) Reports Strong Revenue Growth and Margin Expansion in Q3 2023
Usio Inc (NASDAQ:USIO) announces a 25% revenue increase to $20.5 million in Q3 2023, marking the 13th consecutive quarter of revenue growth.
Gross margins expanded by 1.3% compared to Q3 2022, with gross profits reaching $4.2 million.
Net loss improved significantly to $0.7 million, a $1.0 million enhancement from the previous year's loss.
Adjusted Operating Cash Flows for the first nine months of 2023 stood at $2.4 million, contributing to a solid financial position with $7.4 million in cash and cash equivalents.
On November 8, 2023, Usio Inc (NASDAQ:USIO), a leading FinTech company, released its financial results for the third quarter of 2023, which ended on September 30, 2023. The company reported a significant 25% increase in revenue, reaching $20.5 million, and reiterated its full-year 2023 revenue growth expectations of 18% to 20%. This performance is attributed to a 197% increase in prepaid revenues and a 27% increase in the flagship PayFac business.
Financial Highlights and Performance
Usio Inc (NASDAQ:USIO) experienced robust growth in its prepaid card services, with more than $100 million loaded onto prepaid cards in a single quarter for the first time. This achievement reflects the company's expansion into new markets, including a prepaid card program with a large state. The Usio Output Solutions revenue increased by 9%, and Credit Card revenues saw a 27% increase in the PayFac business, with transactions up by 21% compared to Q3 2022.
Income Statement and Balance Sheet Overview
The company's gross profits for Q3 2023 were $4.2 million, with gross margins expanding by 1.3% compared to the same quarter in the previous year. This margin expansion was primarily due to a favorable sales mix, including higher margin prepaid card residual revenues. Other selling, general, and administrative expenses increased due to non-recurring expenses but are expected to trend lower in the fourth quarter. The net loss for the quarter was $0.7 million, a significant improvement from the $1.8 million loss a year ago. Adjusted EBITDA was a loss of $0.1 million, a $0.4 million improvement from the previous year's loss.
Cash Flow and Balance Sheet Strength
Usio Inc (NASDAQ:USIO) added $1.7 million in cash to the balance sheet over the first nine months of the year, generating $2.4 million in Adjusted Operating Cash Flows during this period. The company's financial position continues to strengthen, with $7.4 million in cash and cash equivalents as of September 30, 2023. This is a testament to the company's ability to generate positive cash flows and maintain a solid financial condition.
Management Commentary
Louis Hoch, President and CEO of Usio, commented on the results, stating,
Revenues were up for the 13th consecutive quarter, with growth both in the quarter and for the first nine months. Results on the bottom line continue to reflect investments in strengthening our infrastructure and establishing a level of marketing and sales investment that will sustain our growth over the long term. Nearing this important inflection point, we believe we will be able to better leverage the top line into faster bottom line growth over the long term."
Conference Call and Webcast
Usio Inc (NASDAQ:USIO) will host a conference call and webcast to discuss the Q3 2023 financial results and provide a business update. Interested parties can access the call and webcast through the company's website or by dialing in directly.
Usio Inc (NASDAQ:USIO) continues to demonstrate strong financial performance with consistent revenue growth and margin expansion. The company's strategic investments in infrastructure and marketing are expected to further enhance its growth trajectory and financial stability. For detailed financial tables and a reconciliation of GAAP to non-GAAP financial measures, please refer to the original earnings release.
For more information and to access the full earnings release, visit Usio Inc's Investor Relations.
Explore the complete 8-K earnings release (here) from Usio Inc for further details.
This article first appeared on GuruFocus.
