CoreCard Corp (CCRD) 2024 Q3 法說會逐字稿

Ladies and gentlemen, greetings, and welcome to CoreCard third quarter 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. (Operator Instructions) As a reminder, this conference is being recorded.

女士們、先生們，大家好，歡迎參加 CoreCard 2024 年第三季財報電話會議。此時，所有參與者都處於只聽模式。正式演講後將舉行簡短的問答環節。（操作員指示）謹此提醒，本次會議正在錄製中。

It is now my pleasure to introduce your host, Matt White, Chief Financial Officer. Please go ahead, sir.

現在我很高興向您介紹主持人，財務長馬特懷特。請繼續，先生。

Thank you, and good morning, everyone. With me on the call today is Leland Strange, Chairman and CEO of CoreCard Corporation. He will add some additional comments, probably more than you are typically used to, and answer questions at the conclusion of my prepared remarks.

謝謝大家，大家早安。今天與我一起參加電話會議的是 CoreCard 公司董事長兼執行長 Leland Strange。他會添加一些額外的評論，可能比你通常習慣的更多，並在我準備好的評論結束時回答問題。

Before I start, I'd like to remind everyone that during the call, we will be making certain forward-looking statements to help you understand CoreCard Corporation and its business environment. These statements involve a number of risk factors, uncertainties and other factors that could cause actual results to differ materially from our expectations. Factors that may affect future operations are included in our filings with the SEC, including our 2023 Form 10-K and subsequent filings.

在開始之前，我想提醒大家，在電話會議中，我們將做出一些前瞻性陳述，以幫助您了解 CoreCard Corporation 及其業務環境。這些陳述涉及許多風險因素、不確定性和其他因素，可能導致實際結果與我們的預期有重大差異。可能影響未來營運的因素包含在我們向 SEC 提交的文件中，包括我們的 2023 年 10-K 表格和後續文件。

We'll also discuss certain non-GAAP financial measures, including adjusted diluted EPS and adjusted EBITDA, which is adjusted for certain items that affect the comparability of our underlying operational performance. These non-GAAP measures are detailed in reconciliation tables included with our earnings release.

我們還將討論某些非公認會計準則財務指標，包括調整後的稀釋每股收益和調整後的 EBITDA，這些指標針對影響我們基本營運績效可比性的某些項目進行了調整。這些非公認會計原則措施在我們的收益發布中包含的調節表中有詳細說明。

Before I get to the financial highlights for the quarter, I'll comment on the filing this morning regarding the decision by our auditor not to stand for reappointment following the completion of our fiscal 2024 audit. This is a business decision that our auditor made, given the expense involved in auditing public companies and the fact that we are currently their only public company client. They may take on public companies in the future but, for now, it didn't make sense for them to have only one public company client, so we will be looking for a new auditor as a result.

在介紹本季度的財務要點之前，我將就今天早上提交的文件發表評論，該文件涉及我們的審計師在完成 2024 財年審計後決定不再重新任命的決定。這是我們的審計師所做的商業決定，考慮到審計上市公司所涉及的費用以及我們目前是他們唯一的上市公司客戶這一事實。他們將來可能會與上市公司合作，但就目前而言，他們只有一個上市公司客戶是沒有意義的，因此我們將尋找一位新的審計師。

And now on to the results for Q3, as we noted in our press release, our third quarter results were better than expected with earlier than expected license revenue. Total revenue for the third quarter of 2024 was $15.7 million, a 17% increase year-over-year, driven by higher license revenue, higher professional services revenue, and higher processing and maintenance revenue. The components of our revenue for the third quarter consisted of license revenue of $1.4 million, professional services revenue of $7 million, which came in ahead of our previously guided range, processing and maintenance revenue of $6.1 million and third-party revenue of $1.2 million.

現在談談第三季的業績，正如我們在新聞稿中指出的那樣，我們的第三季業績好於預期，授權收入早於預期。2024 年第三季的總收入為 1,570 萬美元，年增 17%，這得益於更高的授權收入、更高的專業服務收入以及更高的處理和維護收入。我們第三季收入的組成部分包括 140 萬美元的授權收入、700 萬美元的專業服務收入（超出了我們先前的指導範圍）、610 萬美元的處理和維護收入以及 120 萬美元的第三方收入。

Revenue growth excluding our largest customer was 7% in the third quarter on a year-over-year basis. Revenue growth excluding our largest customer, in addition to the impact from Park Mobile** 0:03:11 and the Legacy Cabbage business as detailed in prior quarters, was 30% in the third quarter on a year-over-year basis and is expected to be 25% to 30% for the full year, which is above our previously guided range of 15% to 20%. We continue to onboard new customers both directly and through various partnerships we have with program managers. As in previous quarters, we currently have multiple implementations in progress and new customers that we expect to go live in the coming months.

不包括我們最大的客戶，第三季的營收年增 7%。不包括我們最大的客戶，加上前幾季詳述的 Park Mobile** 0:03:11 和 Legacy Cabbage 業務的影響，第三季的營收年增 30%，預計全年增長25% 至30 %，高於我們之前15% 至20% 的指導範圍。我們繼續直接或透過與專案經理建立的各種合作夥伴關係來吸引新客戶。與前幾季一樣，我們目前正在進行多項實施，並且預計將在未來幾個月內上線新客戶。

Processing and maintenance revenues increased 4% in the third quarter of 2024 compared to the third quarter of 2023, primarily due to higher revenues from existing customers and the addition of new customers, partially offset by the revenue decline from the Legacy Cabbage business I mentioned above.

與2023 年第三季相比，2024 年第三季的加工和維護收入成長了4%，主要是由於現有客戶的收入增加和新客戶的增加，部分被我上面提到的傳統捲心菜業務的收入下降所抵消。

And turning to some additional highlights on our income statement for the third quarter of 2024, income from operations was $2.8 million for the third quarter of 2024 compared to income from operations of $0.4 million for the same time last year. Our operating margin for the third quarter of 2024 was 18% compared to an operating margin of 3% for the same time last year. The increase is primarily driven by higher license revenue, higher professional services revenue, partially offset by continued investments in our new platform. The income statement impact of our new platform build was $0.7 million in the third quarter 2024 compared to $0.5 million for the prior year period. Our third quarter 2024 tax rate was 25% compared to 24.5% in the third quarter of 2024.

轉向我們 2024 年第三季損益表中的一些其他亮點，2024 年第三季的營運收入為 280 萬美元，而去年同期的營運收入為 40 萬美元。我們 2024 年第三季的營業利益率為 18%，而去年同期的營業利益率為 3%。這一增長主要是由許可收入和專業服務收入的增加所推動的，但部分被我們對新平台的持續投資所抵消。新平台建設對 2024 年第三季損益表的影響為 70 萬美元，去年同期為 50 萬美元。我們 2024 年第三季的稅率為 25%，而 2024 年第三季的稅率為 24.5%。

Earnings per diluted share for the quarter was $0.27 compared to a loss per share of $0.03 for Q3 2023. Adjusted diluted EPS for the quarter excluding stock compensation expense was $0.30 compared to $0.09 for Q3 2023, which excluded an impairment loss on a cost method investment. Adjusted EBITDA was $3.9 million compared to $1.9 million for the third quarter of 2023.

本季攤薄後每股收益為 0.27 美元，而 2023 年第三季每股虧損為 0.03 美元。不包括股票補償費用的本季調整後攤薄每股收益為 0.30 美元，而 2023 年第三季為 0.09 美元，其中不包括成本法投資的減損損失。調整後 EBITDA 為 390 萬美元，而 2023 年第三季為 190 萬美元。

We have over $28 million of cash and marketable securities on our balance sheet, as of September 30, 2024, and we expect to continue generating operating cash flow for the full year of 2024. We plan to use this excess cash and cash generated from operations to continue investing in our new platform and to continue buying back shares. We repurchased 134,650 shares in the first quarter 2024 for $1.6 million, 147,040 shares in the second quarter for $2.1 million, and 123,370 shares in the third quarter for $1.7 million.

截至 2024 年 9 月 30 日，我們的資產負債表上有超過 2,800 萬美元的現金和有價證券，我們預計將在 2024 年全年繼續產生營運現金流。我們計劃利用多餘的現金和營運產生的現金繼續投資我們的新平台並繼續回購股票。我們在 2024 年第一季以 160 萬美元回購了 134,650 股股票，在第二季以 210 萬美元回購了 147,040 股股票，第三季以 170 萬美元回購了 123,370 股股票。

For the full year 2024, we expect total revenue to be approximately flat. As mentioned earlier, we expect growth from customers, excluding our largest customer in addition to the impact of Park Mobile and the Legacy Cabbage business and the $0.5 million of accelerated revenue that we recognized in the first quarter, to be between 25% and 30% for the full year, above our previously guided range of 15% to 20%.

對於 2024 年全年，我們預計總收入將大致持平。如前所述，除了Park Mobile 和Legacy Cabbage 業務的影響以及我們在第一季確認的50 萬美元加速收入之外，我們預計客戶的成長（不包括我們最大的客戶）將在25% 至30%之間全年增長，高於我們之前 15% 至 20% 的指導範圍。

Within services, we continue to expect strong growth in processing and maintenance as our customers continue to grow as we continue to onboard new customers. As mentioned in our press release this morning, for the fourth quarter of 2024 we expect total revenues to be between $13.3 million and $13.7 million and earnings per share between $0.07 and $0.09.

在服務方面，隨著我們不斷吸引新客戶，我們的客戶不斷成長，我們繼續預期處理和維護方面將出現強勁成長。正如我們今天上午的新聞稿中所提到的，我們預計 2024 年第四季的總收入將在 1,330 萬美元至 1,370 萬美元之間，每股收益將在 0.07 美元至 0.09 美元之間。

We recently renewed our agreements with Goldman as outlined in our 8-K filing with the SEC last week extending the agreements through December 31, 2030 with early termination rights starting in January 2027. This extension gives us increased managed services fees starting in January 2025, resulting in higher fixed revenue from Goldman and increased visibility on revenues from them for at least the next two plus year. With this increased visibility, we provided guidance for 2025 of total revenue between $60 million and $64 million and earnings per share between $0.88 and $0.94 and revenue growth excluding Goldman of 30% to 40%.

我們最近續簽了與高盛的協議，如上周向 SEC 提交的 8-K 文件中所述，將協議延長至 2030 年 12 月 31 日，並從 2027 年 1 月開始提前終止。此次延期使我們從 2025 年 1 月開始增加管理服務費用，從而提高高盛的固定收入，並提高至少在未來兩年多的收入可見度。隨著知名度的提高，我們預計2025 年總收入將在6000 萬美元至6400 萬美元之間，每股收益在0.88 美元至0.94 美元之間，不包括高盛的收入增長將在30% 至40% 之間。

With that, I'll turn it over to Leland.

有了這個，我會把它交給利蘭。

Okay, thanks Matt. Yeah, I showed a day like this when both the Russell and S&P are down 110%. Asked Matt not to schedule our conference calls on days when the market crashes, but nevertheless it is Halloween. So as Matt said, the quarter results did exceed our expectations from our call even a quarter ago. We do frequently have lumpy revenues that are hard to project. We've talked about that many times before. It consists of license revenue or the lack thereof, and that revenue often distorts period-to-period comparisons. We don't know in advance, it's based on active cards of licensed clients at the end of the quarter. We don't know the answer until reports are run several days following the quarter end. Best we can do is give you our predictions given what we know at the time. I'll admit we try to be conservative, but also accurate. It's what I call the line of sight view and not a hopeful view.

好的，謝謝馬特。是的，我展示了這樣的一天，羅素指數和標準普爾指數都下跌了 110%。請馬特不要將我們的電話會議安排在市場崩潰的日子，但不管怎樣，今天是萬聖節。正如馬特所說，季度業績甚至超出了我們在一個季度前的電話會議中的預期。我們確實經常有難以預測的不穩定收入。我們之前已經討論過很多次了。它包括許可收入或缺乏許可收入，而該收入往往會扭曲不同時期的比較。我們事先並不知道，它是基於季度末授權客戶的有效卡。直到季度結束後幾天的報告發布後我們才能知道答案。我們能做的就是根據我們當時所知的情況向您提供我們的預測。我承認我們試圖保守，但也很準確。這就是我所說的視線視圖，而不是充滿希望的視圖。

With Matt's comments today, I think we're providing a little more of a forward view of how we see things while noting areas of risk. My comments today will follow a four point outline incorporating the four most frequently asked questions we get in conversations with investors. We certainly don't selectively disclose info, so for you who have asked these questions in the past and didn't get a satisfactory answer, hopefully you will today. Now they'll include a lot of opinions, beliefs and just thoughts as of right now, so they clearly fall under forward-looking statements for safe harbor purposes, so you should consume them with that caveat in mind.

透過馬特今天的評論，我認為我們在註意到風險領域的同時，提供了更多關於我們如何看待事物的前瞻性觀點。我今天的評論將遵循四點大綱，其中包含我們與投資者對話中最常見的四個問題。我們當然不會選擇性地披露信息，因此對於過去提出過這些問題但沒有得到滿意答案的您來說，希望今天您能得到滿意的答案。現在，它們將包含許多觀點、信念和公正的想法，因此它們顯然屬於出於安全港目的的前瞻性陳述，因此您在閱讀它們時應牢記這一警告。

The outline for my comments or questions is first Goldman Sachs relationship and all that entails nephrologists, a highly concentrated position at CoreCard; second, succession or my situation; third, acquisition or what we do with cash and then I'll give a brief summary and talk about growth outside of Goldman.

我的評論或問題的大綱首先是與高盛的關係，以及所有需要腎病專家、CoreCard 高度集中的職位的關係；第二，繼承或我的情況；第三，收購或我們如何使用現金，然後我將做一個簡短的總結並談論高盛以外的成長。

So for topic number one, the Goldman Sachs relationship, I'll elaborate a little more on the newly amended agreement, but I need to warn the press or others that are listening to this call that you cannot read anything to what I say to predict anything about Goldman Sachs or Apple. What I say simply is my belief what CoreCard will be doing and expecting. Goldman Sachs, we have a totally different view. The new amended agreement is very good for CoreCard, in that we have more certain locked in revenue through the end of 2026, the next two plus years. I've said in each of the earnings calls this year, I think, that we're likely to be processing the Apple card with Goldman through 2026. This new agreement doesn't say that, although I believe it to be true. It says that government will pay us the contracted amount through 2026 whether we are processing or not because they can't cancel the contract before then.

因此，對於第一個主題，即高盛關係，我將詳細闡述新修訂的協議，但我需要警告正在收聽此電話會議的媒體或其他人，你們無法解讀我所說的預測內容有關高盛或蘋果的任何資訊。我所說的只是我對 CoreCard 將要做的事情和所期望的事情的信念。高盛，我們有完全不同的觀點。新修訂的協議對 CoreCard 來說非常有利，因為我們可以更確定地在 2026 年底（未來兩年多）之前鎖定收入。我認為，我在今年的每次財報電話會議上都說過，我們很可能會在 2026 年之前與高盛一起處理 Apple 卡。這項新協議並沒有這麼說，儘管我相信這是真的。它說，無論我們是否正在處理，政府都將在 2026 年之前向我們支付合約金額，因為在此之前他們無法取消合約。

It also says they'll pass a termination fee if they cancel before December 2030. Now I believe that will happen. In fact, it's almost certain it'll happen. You can generally assume that termination fees usually higher if canceled earlier and smaller if canceled for the terminal date. What I think will happen is based on what Goldman has said publicly and what has been said in the press. I offer you really nothing new other than my interpretation and opinion. But first talk about the [GM] program. It is definitely going to Barclays Bank. That has been announced by Barclays and Goldman. Barclays has a current relationship with a legacy processor and is more than likely going to move processing to their current provider. It's a standard credit card with limited innovation. The reward portion is handled directly by General Motors even today, so it should be easy to transition. The press says it will happen in the third quarter 2025. That in itself should give you an idea of how long it takes to transition and that the name Barclays was first in the press in April earlier this year. So April to third quarter next year would be about 18 months. Actual conversion time, however, for a program like this would typically be about 12 months. Note that there's very little revenue impact for this conversion off of CoreCard due to the fact it's coming off of license software and not a processing agreement. While licensing has some disadvantages, it also has some advantages. The conversion off does, however, minimize future license fees we might have collected in future years, so I'm not going to minimize the loss.

它還表示，如果他們在 2030 年 12 月之前取消，他們將收取終止費用。現在我相信這會發生。事實上，幾乎可以肯定它會發生。您通常可以假設，如果提前取消，終止費用通常會更高，如果在終止日期取消，終止費用通常會更低。我認為將會發生的事情是基於高盛的公開言論和媒體報道。除了我的解釋和觀點之外，我確實沒有向您提供任何新內容。但首先先談談[GM]計劃。一定是去巴克萊銀行。巴克萊銀行和高盛已經宣布了這一消息。巴克萊銀行目前與傳統處理商保持合作關係，並且很可能會將處理轉移給目前的提供者。這是一張標準信用卡，創新有限。即使在今天，獎勵部分仍由通用汽車直接處理，因此應該很容易過渡。媒體稱這將於 2025 年第三季發生。這本身應該讓您了解過渡需要多長時間，以及巴克萊這個名字在今年早些時候的四月首次出現在媒體上。所以4月到明年第三季大約是18個月。然而，此類程序的實際轉換時間通常約為 12 個月。請注意，這種從 CoreCard 的轉換對收入影響很小，因為它是從授權軟體而不是處理協議中獲得的。雖然許可有一些缺點，但它也有一些優點。然而，轉換確實可以最大限度地減少我們在未來幾年可能收取的未來許可費，因此我不會將損失降至最低。

Second, about the Apple program, I think the program will be moved to another bank. A year ago the press said they were talking to Amex. Wall Street Journal and Bloomberg have recently reported conversations going on with JP Morgan. I can neither confirm nor deny that and it would be out of line for me to comment on that speculation. What I would speculate is that the Apple program will be processed on the CoreCard Pro platform for a longer period than what is guaranteed to be paid under the amended contract. I believe that the card will be on the platform until at least mid-2027. And note I said believe, while I have no information that would confirm that belief, and I really don't think anyone knows today. It could be longer, it could be much longer. The program might not find a willing buyer, but I think they will, or the buyer could choose to still use the platform for a short or even long period. We're certainly open to working with a potential buyer to make that happen. We will not be making any specific comments about this or any negotiations unless there is a more than likely than not something happening that would materially impact our future financial results that actually differs from what we have said. In future calls, I expect to have very little to say about this subject, which is why I'm trying to be as open and comprehensive as possible today. This is all very positive for CoreCard. We intend to continue servicing Goldman as a significant and very reliable partner for the highest level of service possible. Goldman rightly expects that and is paying for that kind of attention. Both Goldman and his partner Apple are first-class companies that demand and expect first-class service for their customers and we're happy to be that kind of company and definitely don't want to disappoint.

第二，關於蘋果的計劃，我認為該計劃將轉移到另一家銀行。一年前，媒體稱他們正在與美國運通公司進行談判。《華爾街日報》和彭博社最近報道了與摩根大通的對話。我既不能證實也不能否認這一點，我對這種猜測發表評論是不合時宜的。我推測，Apple 計劃在 CoreCard Pro 平台上處理的時間將比修訂後的合約保證支付的時間更長。我相信該卡至少會在 2027 年中期之前出現在平台上。請注意，我說相信，雖然我沒有任何資訊可以證實這一信念，而且我真的認為今天沒有人知道。它可能會更長，可能會更長。該程式可能找不到願意的買家，但我認為他們會的，或者買家可以選擇仍然使用該平台短期甚至長期。我們當然願意與潛在買家合作以實現這一目標。我們不會對此或任何談判發表任何具體評論，除非發生的事情很可能會對我們未來的財務業績產生重大影響，而這些事情實際上與我們所說的不同。在未來的電話會議中，我預計不會對這個主題說太多，這就是為什麼我今天試圖盡可能開放和全面。這對 CoreCard 來說都是非常積極的。我們打算繼續作為重要且非常可靠的合作夥伴為高盛提供盡可能最高水準的服務。高盛正確地預期了這一點，並且正在為這種關注付出代價。高盛和他的合作夥伴蘋果都是一流的公司，他們要求並期望為客戶提供一流的服務，我們很高興成為這樣的公司，並且絕對不想失望。

The last comment about this program concerns questions we received about the recent fines imposed by the CFPB of Goldman and Apple. CordCard was not part of the issue and was not part of any investigations. In my opinion, the issues resulted from the success of the program. Mass growth in financial services often leads to issues. Yes, there were mistakes as pointed out by the CFPB, but they were not intentional. They were not the results of poor management decisions. They were the result of being overwhelmed by the phenomenal success of the program and having insufficient resources and systems to cope. I believe fines should be imposed on managements who fail to respond to problems or those that are insensitive to customer complaints or those who just don't care, not to those who are working feverishly and are highly sensitive to customer success, as are Apple, Goldman. And we know from our relationship how much they want to do right for their customers, as they push us for perfection, but that's just my two cents.

關於該計劃的最後一條評論涉及我們收到的有關 CFPB 最近對高盛和蘋果公司罰款的問題。CordCard 不屬於該問題的一部分，也不屬於任何調查的一部分。在我看來，這些問題是由於該計劃的成功所造成的。金融服務的大規模成長常常會帶來問題。是的，CFPB 指出了錯誤，但他們不是故意的。它們不是糟糕的管理決策的結果。它們是由於該計劃的巨大成功而不知所措，並且沒有足夠的資源和系統來應對的結果。我認為罰款應該針對那些未能對問題作出反應、對客戶投訴不敏感或根本不在乎的管理層，而不是那些狂熱工作並對客戶成功高度敏感的管理層，就像蘋果公司一樣，高盛。我們從我們的關係中知道他們多麼想為客戶做正確的事，因為他們推動我們追求完美，但這只是我的兩分錢。

Two more topics I'll cover because we often get questions around them, they are about succession and the possibility of being acquired or a CoreCard acquiring another company. First, let's talk about succession. I don't shy away from talking about the fact that I've been doing this a long time and despite the Good Lord has blessed me at the age of 83 with good health and the energy and drive to keep pushing, it is in my opinion the time to consider someone else for President who could do what is needed to keep the company owned its present good trajectory. I guess I should caveat the hill coming that in that I do need a new knee as my bum one kept me off the ski slopes with my grandchildren for the first time this year breaking my 15 year consecutive stream. The CoreCard Board has for the last several years discussed succession planning at almost every Board meeting, so this is nothing new. There are no specific plans in place. I do expect it to move from the discussion and consideration phase to action early next year. Who knows, a new President might even decide to establish a sales team. Now for those who might not know, CoreCard has no salespeople and does very little marketing. So that last statement is made with a little squint in the eye. Current non-Goldman revenue growth, which we think will come in at a 30% compound annual growth rate over a three year period, comes from growth of existing programs, web inbound and referrals. It may be that a new sales team can speed up that. It may be that our capabilities would limit us to either 30% growth rate anyway for the next couple of years.

我將討論另外兩個主題，因為我們經常收到有關它們的問題，它們是關於繼承和被收購或 CoreCard 收購另一家公司的可能性。首先，我們來談談繼承。我並不迴避談論這樣一個事實，即我已經這樣做了很長時間，儘管上帝在 83 歲時祝福我身體健康，並且有繼續努力的精力和動力，但這是我的責任。任命其他人來擔任總裁了，他可以做必要的事情來維持公司目前的良好發展軌跡。我想我應該警告即將到來的山坡，因為我確實需要一個新膝蓋，因為我的屁股讓我今年第一次打破了我連續 15 年的滑雪場紀錄，讓我和我的孫子們無法滑雪。過去幾年，CoreCard 董事會幾乎在每次董事會會議上都討論了繼任計劃，因此這並不是什麼新鮮事。目前還沒有具體的計劃。我確實希望明年初能夠從討論和考慮階段轉向行動。誰知道呢，新任總裁甚至可能決定建立一個銷售團隊。對於那些可能不知道的人來說，CoreCard 沒有銷售人員，也很少進行行銷。所以最後一句話是在瞇著眼睛說的。目前的非高盛收入成長（我們認為三年內複合年增長率將達到 30%）來自現有計劃、網路入站和建議的成長。新的銷售團隊可能會加快這一速度。無論如何，我們的能力可能會限制我們在未來幾年內達到 30% 的成長率。

The last topic is about use of cash and acquisition potential. We have previously been buy stock but not in a blackout period under a plan that was previously approved by the Board. It is our intent to keep doing so. We believe the current stock price significantly undervalues the company when viewed as either a standalone enterprise. Given the future we see, as well as the value it might bring as part of a larger organization with established sales force. I can admit we do lose some deals now due to our small size. As far as using cash to fund an acquisition in the fintech space, we're regularly approached by possibilities, but almost in every case it's for companies losing money with a cash burn and hockey stick projections that is really not appealing to us as a company that has grown while staying consistently profitable. Matt and I also filled regular inquiries and reach outs from private equity groups and investment bankers with thoughts of companies that might be or are interested in acquiring us and even we get them directly for the companies themselves.

最後一個主題是關於現金的使用和收購潛力。根據董事會先前批准的計劃，我們之前曾購買過股票，但並未處於禁售期。我們打算繼續這樣做。我們認為，當將該公司視為獨立企業時，目前的股價明顯低估了該公司的價值。考慮到我們所看到的未來​​，以及它作為擁有成熟銷售團隊的大型組織的一部分可能帶來的價值。我可以承認，由於我們的規模較小，我們現在確實失去了一些交易。至於使用現金為金融科技領域的收購提供資金，我們經常收到各種可能性，但幾乎在所有情況下，都是因為公司因現金消耗和曲棍球棒預測而虧損，這對我們公司來說確實沒有吸引力在保持持續獲利的同時不斷成長。馬特和我也會定期詢問私募股權集團和投資銀行家，了解可能或有興趣收購我們的公司的想法，甚至我們直接為公司本身獲取這些資訊。

CoreCard is shareholder owned, so of course we want to see shareholders rewarded. We have had large private equity groups, names you would all recognize, visit our offices both to gain more information and also to pitch us. While we work for shareholders, we also have a responsibility to employees and customers and we strive to balance the short term and long term consequences for each of these constituencies. We have concluded that the likelihood of a private equity transaction is very limited. We're not interested in any type of squeeze for loyal shareholders and that's usually a component of a private equity proposal. We've had several management teams from interested acquiring companies, both domestic international, come to Norcross over the past several years and even as recently as this month. We have also reached out to some in normal course of business looking for partnerships and have had some serious conversations. Typically the conclusion is that our team and technology are first class of the unknown surrounding the Goldman relationship and the noise surrounding the future of the Apple program plus our low stock price, the optics beating what we believe would be the right balance for shareholders is a hurdle. Notice I said optics as the real substitute value is usually confirmed. It may be that some interest has been rekindled with the recent amended agreement with Goldman providing a little bit more certainty.

CoreCard 是股東所有，所以我們當然希望看到股東得到回報。我們有一些你們都認識的大型私募股權集團訪問我們的辦公室，既是為了獲取更多信息，也是為了向我們推銷。在我們為股東工作的同時，我們也對員工和客戶負有責任，我們努力平衡每個群體的短期和長期後果。我們的結論是，私募股權交易的可能性非常有限。我們對任何形式的對忠誠股東的擠壓不感興趣，這通常是私募股權提案的組成部分。在過去的幾年裡，甚至就在這個月，我們已經有幾個來自有興趣的國內國際收購公司的管理團隊來到諾克羅斯。我們也與一些在正常業務過程中尋找合作夥伴的人進行了接觸，並進行了一些認真的對話。通常的結論是，我們的團隊和技術是圍繞高盛關係的未知因素的一流，以及圍繞蘋果計劃未來的噪音，加上我們的低股價，光學擊敗我們認為對股東來說是正確的平衡是一個欄。請注意，我說光學作為真正的替代值通常是確定的。最近與高盛修訂的協議提供了更多的確定性，這可能重新激起了一些興趣。

I might digress a second and talk about the newer cloud agnostic native successor platform we're building that's called Corefinity or CoreFi for short. We're almost four years into it and have another year to go before it will be ready for production; ready by the end of 2025 but probably not fully utilized until 2026. Now the current platform is very good, but CoreFi is taking advantage of all the newest tools with the goal of being the most flexible, feature rich, cloud native, active-active, real-time credit platform in the world with the lowest maintenance and operating cost. It's truly superior to anything we're aware because today and it's well positioned to compete with the legacy processors. But that's a digression, but it has something to do with value. So I suspect some of you are going to ask what do I think the value is? I'm not going to put a specific number on it, but we have invested more than 130 million built in the current and Corefinity platforms. And just as important as the dollars invested or even more is the fact it would take someone four or more years if they started now to get where we are. We have thousands of test cases for revolving credit. No other modern processor possesses that. We have the proven scale that no other processor has. All other modern processors combined we believe have less than a million revolving cards and we have around 15 million. You learn a lot. You scale up to where we are and our people make up the real value with 1000 team members with heavy and detailed knowledge of the credit card domain and offices in Atlanta, Romania, India, Colombia and Dubai. Over 350 of them have been with CoreCard for more than five years. Many more than 10 years. Just this year we began issuing restricted shares that have three year vesting to some long tenured employees, those with more than five years as incentive comp to keep them focused on building value and strong customer support. Plus we've got customers such as Goldman, American Express for small business loans, Gemini, Qatar Airways through great partnership with Cardless, Reserve, Amarillo National Bank, Alansari, Stride bank and on and out.

我可能會離題一下，談談我們正在建立的更新的與雲端無關的本機後繼平台，簡稱為 Corefinity 或 CoreFi。我們已經投入了近四年的時間，距離投入生產還有一年的時間。到 2025 年底準備就緒，但可能要到 2026 年才能充分利用。現在目前的平台非常好，但 CoreFi 正在利用所有最新的工具，目標是成為世界上最靈活、功能豐富、雲端原生、主動-主動、即時信用平台，維護費用最低。它確實優於我們所知道的任何東西，因為今天它已經處於與傳統處理器競爭的有利位置。但這是題外話，但這與價值有關。所以我懷疑你們中的一些人會問我認為價值是什麼？我不會透露具體數字，但我們已經在當前平台和 Corefinity 平台上投入了超過 1.3 億美元。與投入的美元甚至更多資金同樣重要的是，如果有人現在開始就需要四年或更長時間才能達到我們現在的水平。我們有數千個循環信貸測試用例。沒有其他現代處理器具備這一點。我們擁有其他處理器所不具備的經過驗證的規模。我們相信所有其他現代處理器的總數量不到 100 萬張循環卡，而我們大約有 1500 萬張。你學到了很多東西。您可以擴展到我們現在的位置，我們的員工擁有 1000 名對信用卡領域擁有豐富而詳細知識的團隊成員，並在亞特蘭大、羅馬尼亞、印度、哥倫比亞和杜拜設有辦事處，從而構成了真正的價值。其中超過 350 人使用 CoreCard 的時間超過五年。很多都超過10年了。就在今年，我們開始向一些長期任職的員工發行限制性股票，這些股票的歸屬期為三年，這些員工的任期為五年以上，作為激勵措施，使他們能夠專注於創造價值和強大的客戶支持。此外，透過與 Cardless、Reserve、阿馬裡洛國家銀行、Alansari、Stride 銀行等的良好合作關係，我們也擁有高盛、美國運通小型企業貸款、Gemini、卡達航空等客戶。

So back to value. Last summer we were trading in the 20s. The market's up a lot. The company looks better and has more visibility of future revenues than a year ago in all respects. So as a personal observation and speaking as probably the largest shareholder, I don't expect to vote or support any acquisition offer that would value the company for less than something north of 200 million. And I fully support the company buying back its shares with excess cash, given the current stock price. The buyback limits the shareholder dilution that comes with providing the restricted stock grants that I mentioned earlier. You can do your own math around stock price. I emphasize with this comment. I'm speaking personally of the way I currently feel. I think our results speak to themselves. We're comfortable continuing on our current trajectory.

那麼回到價值。去年夏天我們的交易價格是 20 多歲。市場漲了很多。該公司在各方面都比一年前看起來更好，對未來收入的了解也更清楚。因此，作為個人觀察並作為最大股東發言，我預計不會投票或支持任何使公司估值低於 2 億以上的收購要約。鑑於目前的股價，我完全支持該公司用多餘現金回購其股票。回購限制了我之前提到的提供限制性股票授予所帶來的股東稀釋。您可以根據股票價格自行計算。我用這個評論強調。我正在談論我個人目前的感受。我認為我們的結果不言而喻。我們很樂意繼續沿著目前的軌跡前進。

The company is well positioned to continue to grow its non Goldman business at a 30% compounded annualized rate with decreasing earnings in the next few years as a lot of that revenue drops straight to the bottom line. Our expenses are increasing slowly. We're not as scaled as a processor, but margins will start going up. All internal planning is focused on making that happen while we still try to balance the interests of our shareholders, employees and customers by being open to a transaction.

該公司處於有利地位，可以繼續以 30% 的複合年化成長率成長其非高盛業務，但未來幾年的收益將下降，因為大部分收入直接下降到盈利。我們的開支正在緩慢增加。我們的規模不如處理器，但利潤率將開始上升。所有內部規劃的重點都是實現這一目標，同時我們仍然透過對交易持開放態度來平衡股東、員工和客戶的利益。

With that, I'm happy to take any questions. And while you're thinking of questions, I guess I should conclude that we don't update progress numbers, activities or discussions between quarters unless mandated and don't comment unless until there's something substantive to talk about. So let's open for questions and we'll conclude at that.

因此，我很樂意回答任何問題。當你在思考問題時，我想我應該得出這樣的結論：除非有強制要求，否則我們不會更新季度之間的進度數字、活動或討論，除非有實質性內容可以討論，否則我們不會發表評論。那麼，讓我們開始提問，然後我們就得出結論。

Thank you. Ladies and gentlemen, we will now be conducting a question-and-answer session. (Operator Instructions) Ladies and gentlemen, we will wait for a moment while we poll for questions. The question comes from the line of Hal Goetsch from B. Riley Securities. Please go ahead.

謝謝。女士們、先生們，我們現在將進行問答環節。（操作員指示）女士們、先生們，我們將稍等片刻，然後進行投票提問。這個問題來自 B. Riley Securities 的 Hal Goetsch。請繼續。

Hey, thanks guys and thanks Leland for your commentary and the story about your family. That's terrific. I wanted to ask if you could help us bridge the change in non-Goldman revenue growth from the prior guidance. What's kind of going on in the last quarter and a half that allow you to take that guidance up and can you just give us as much detail as you can? Thanks.

嘿，謝謝大家，感謝利蘭的評論和關於你家庭的故事。太棒了。我想問您是否可以幫助我們彌補非高盛收入成長與先前指導的變化。過去一個半季度發生了什麼事情讓您能夠採納這項指導意見？謝謝。

Yeah, I'm going to let Matt talk to that a little bit.

是的，我要讓馬特談談這個問題。

You're talking about just from taking it from 15 to 20 to 25 to 30. You know, a lot of that is some of the new programs that have come on. Some of that's reflected in the third party revenues being higher than expected and really that's hopefully in anticipation of future processing revenue. So, I think that speaks to the numbers for next year as well. But that was a big, a big driver I would say of why the number came up from Q2 to Q3 for the full year to 25 to 30% excluding Goldman.

你所說的只是從 15 到 20 到 25 到 30。你知道，其中很多都是一些已經推出的新項目。其中一些反映在第三方收入高於預期，這實際上是對未來處理收入的預期。所以，我認為這也說明了明年的數字。但我想說，這是一個很大很大的推動因素，這也是為什麼全年第二季到第三季（不包括高盛）的數字上升到 25% 到 30% 的原因。

Okay. And on next year's guidance, can you give us any feel for how much of it of that is a license revenue or is it too soon to guide to that?

好的。關於明年的指導，您能否告訴我們其中有多少是授權收入，或者現在給出指導是否為時過早？

It's really too soon given that the license revenue came in a little sooner than we expected here in Q3. And then the timing of the deconversion of the GM program will be a big -- will have a big impact on license revenue. So we're really not counting on license revenue in 2025, given those dynamics.

鑑於授權收入的到來比我們在第三季的預期要早一些，現在確實為時過早。然後，通用汽車計劃取消轉換的時間將會對授權收入產生重大影響。因此，考慮到這些動態，我們確實不指望 2025 年的授權收入。

Yeah, I think the story is a good growth in the non Goldman stuff. So license revenue, if we get any somewhere along the way that's fine, but it's not something we're counting on. We're counting on just continuing to grow the company from the non-government side.

是的，我認為這個故事在非高盛方面有很好的發展。因此，如果我們在過程中獲得任何許可收入，那很好，但這不是我們所指望的。我們指望從非政府方面繼續發展公司。

Okay. And if you were -- last question for me until I get back in the queue. If JP Morgan maybe you can't comment but I would think JP Morgan would take this program in house given their vast processing businesses and payments businesses. How long do you think it will be before a decision for a sale? Because as you mentioned Leland, there's been multiple parties interested in the Apple card. Any thoughts on your timing there?

好的。如果你是——我回到隊列之前問我的最後一個問題。如果是摩根大通，您可能無法發表評論，但鑑於其龐大的處理業務和支付業務，我認為摩根大通會在內部採用該計劃。您認為需要多長時間才能做出出售決定？因為正如您所提到的 Leland，有多方對 Apple 卡感興趣。對你在那裡的時間有什麼想法嗎？

I think -- as I said, I don't think anybody, and I don't really mean that anybody knows timing. There may be some people guessing right now, but I don't think it's at a point where anybody can know the timing and the difference there, you rightly surmise that it would make sense for JPMorgan to take it inside. On the other hand, it might not, it actually could be disruptive. The Apple program has some unique things to it and it's a decision that we're not going to be party to. So I'm just sort of speculating here. I mean that will be happening outside of any conversation we might have as to where it goes. I would say yeah, common sense says they might take it on, but also you could also make a good argument it might be cheaper and less disruptive to work with someone like ourselves to continue it going if it is going to JP Morgan of which we're not privy to or whatever comment about.

我認為——正如我所說，我認為沒有人知道時機，我並不是說有人知道時機。現在可能有人在猜測，但我不認為現在任何人都可以知道時機和差異，你正確地猜測摩根大通將其納入其中是有意義的。另一方面，它可能不會，它實際上可能具有破壞性。蘋果的計畫有一些獨特之處，我們不會參與這個決定。所以我只是在這裡猜測。我的意思是，這將發生在我們可能就其方向進行的任何對話之外。我會說是的，常識表明他們可能會接受它，但你也可以提出一個很好的論點，如果它去摩根大通，我們可能會更便宜，並且與像我們這樣的人合作繼續進行下去，這可能會更便宜，也更不具破壞性。

Okay, thank you.

好的，謝謝。

Thanks Hal.

謝謝哈爾。

Thank you. Ladies and gentlemen, this concludes our question answer session. I would now hand the conference over to Mr. Leland Strange for his closing comments.

謝謝。女士們先生們，我們的問答環節到此結束。我現在將會議交給利蘭·斯特蘭奇先生發表閉幕詞。

Okay. Well that does conclude our call today. We appreciate the interest in the company and as I usually say, if you have any further questions, please let Matt or I know, and we thank you for your interest in the company. Have a good day. Thanks.

好的。好了，我們今天的電話會議到此結束。我們感謝您對公司的興趣，正如我通常所說，如果您還有任何其他問題，請告訴馬特或我，我們感謝您對公司的興趣。祝你有美好的一天。謝謝。

Thank you. The conference of CoreCard has now concluded. Thank you for your participation. You may now disconnect your lines.

謝謝。 CoreCard大會至此結束。感謝您的參與。現在您可以斷開線路。