Rekor (REKR) Q4 2025 Earnings Call Transcript

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Date

Monday, May 11, 2026 astatine 4:30 p.m. ET

Call participants

• Chief Executive Officer — Robert A. Berman

• Chief Financial Officer — Joseph Nalepa

Full Conference Call Transcript

Joseph Nalepa: Good afternoon, everyone. I'd similar to commencement by thanking each of our investors and stakeholders who person joined america connected today's call. Today, I'll locomotion done our fiscal results for the twelvemonth ended December 31, 2025. We've been focusing connected execution and operational ratio and are encouraged by the advancement we proceed to make. During 2025, we continued to present apical enactment gross maturation portion besides uncovering efficiencies wrong our operations. For the twelvemonth ended December 31, 2025, we recognized gross of $48.5 million, an summation of 5% compared to gross of $46 cardinal successful 2024. This summation represents continued maturation crossed our nationalist information and municipality mobility businesses.

Throughout 2025, we proceed to spot maturation successful our income pipeline and progressive deployments. As of December 31, 2025, our remaining show obligations accrued to $25.9 million, a astir 80% summation from December 31, 2024, which highlights beardown momentum, giving america assurance successful our quality to thrust maturation into 2026. For the twelvemonth ended December 31, 2025, recurring gross was $23.9 million, up 6% year-over-year. This reflects our semipermanent strategy of expanding our recurring gross basal done bundle and Data-as-a-Service subscription contracts. Adjusted borderline for 2025 was 56% versus 49% successful 2024. This betterment was mostly driven by a greater information of high-margin bundle income comparative to our work and hardware-based contracts arsenic good arsenic operational efficiencies wrong our deployments.

As we proceed to grow, we expect margins to fluctuate implicit time, but to gradually stabilize arsenic our Software and Data-as-a-Service businesses go a larger stock of full revenue. As mentioned successful our caller property release, we made the determination to onshore our engineering efforts to optimize our engineering operations and outgo containment efforts. As a effect of this decision, we recognized a noncash plus impairment complaint of $3.8 cardinal successful 2025. A cardinal item this twelvemonth was our continued absorption connected optimizing our operations. Total operating expenses, excluding depreciation, amortization and plus impairment charges, declined 20% year-over-year, representing an $11.4 cardinal reduction.

These reductions were achieved crossed each large areas of the concern and bespeak continuing disciplined outgo containment and a deliberate realignment of resources to enactment our strategy. The operation of gross maturation and improved operational ratio resulted successful important profitability improvements. Adjusted EBITDA nonaccomplishment for 2025 was $18.1 million, an betterment of $11 cardinal oregon 38% compared to 2024. A meaningful indicator of our advancement successful 2025 is the trajectory of our adjusted EBITDA nonaccomplishment passim the year.