UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☑ QUARTERLY REPORT UNDER SECTION 13 OR 15(Dd) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September~~March 3031, ~~2024~~2025 OR

☐ TRANSITION REPORT UNDER SECTION 13 OR 15(Dd) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period fromto

For the transition period from _________ to _________

Commission file number 1-9330

CORECARD CORPORATION

(Exact name of registrant as specified in its charter)

Georgia	58-1964787
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

One Meca Way, Norcross, Georgia	30093
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (770) 381-2900

Securities registered pursuant to Section 12(b) of the Exchange Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, $0.01 par value per share	CCRD	NYSE

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

~~Indicate~~Indicated by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, and “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☑	Smaller reporting company	☑
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use to the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

As of ~~October~~April 3130, ~~2024~~2025, 7,~~901~~786,~~148~~679 shares of Common Stock of the ~~registrant~~issuer were outstanding.

CoreCard Corporation

Index Form

~~Form~~ 10-Q

		Page
Part I	Financial Information
Item 1	Financial Statements ~~(unaudited)~~
	Consolidated Balance Sheets at September 30, 2024 and December 31, 2023	3
	Consolidated Balance Sheets at March 31, 2025 and December 31, 2024	3
	Consolidated Statements of Operations for the three and nine months ended September 30, 2024 and 2023	4
	Consolidated Statements of Operations for the three months ended March 31, 2025 and 2024	4
	Consolidated Statements of Comprehensive Income (Loss) for the three and nine months ended September 30, 2024 and 2023	4
	Consolidated Statements of Comprehensive Income for the three months ended March 31, 2025 and 2024	4
	Consolidated Statements of Stockholders’ Equity for the three and nine months ended September 30, 2024 and 2023	5
	Consolidated Statements of Stockholders’ Equity for the three months ended March 31, 2025 and 2024	5
	Consolidated Statements of Cash Flows for the nine months ended September 30, 2024 and 2023	6
	Consolidated Statements of Cash Flows for the three months ended March 31, 2025 and 2024	6
	Notes to Consolidated Financial Statements	7
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	13
Item 3	Quantitative and Qualitative Disclosures About Market Risk	1718
Item 4	Controls and Procedures	1718
Part II	Other Information
Item 1	Legal Proceedings	18
Item 1A.	Risk Factors	18
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	18
Item 3	Defaults Upon Senior Securities	19
Item 4	Mine Safety Disclosures	19
Item 5	Other Information	19
Item 6	Exhibits	19
Signatures		19

Part I FINANCIAL INFORMATION

Item 1. Financial Statements

CoreCard Corporation

CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts)

As of	~~September~~March 3031, ~~2024~~2025			December 31, ~~2023~~2024
	(unaudited)			(audited)
ASSETS
Current assets:
Cash and cash equivalents	$	22,~~498~~068		$	2619,~~918~~481
Marketable securities		5,~~511~~575			5,~~230~~410
Accounts receivable, net		78,~~320~~527			710,~~536~~235
Other current assets		65,~~522~~145			45,~~805~~048
Total current assets		41,~~851~~315			4440,~~489~~174
Investments		3,~~632~~344			43,~~062~~776
Property and equipment, at cost less accumulated depreciation		1113,~~954~~605			1112,~~319~~282
Other long-term assets		56,~~371~~130			36,~~956~~106
Total assets	$	6264,~~808~~394		$	6362,~~826~~338
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	1,~~628~~514		$	~~1,557~~823
Deferred revenue, current portion		1,~~264~~927			2,~~310~~033
Accrued payroll		2,~~459~~341			2,~~172~~856
Accrued expenses		~~1,050~~821			~~971~~723
Other current liabilities		21,~~143~~731			2~~,530~~.017
Total current liabilities		8,~~544~~334			98,~~540~~452
Commitments and Contingencies (see Note 9)
Noncurrent liabilities:
Deferred revenue, net of current portion		~~161~~82			~~265~~118
Other long-term liabilities		372			196
Long-term lease obligations		1,599			1,816
Long-term lease obligation		2,044			1,121
Other long-term liabilities		321			255
Total noncurrent liabilities		2,~~577~~002			12,~~582~~189
Total liabilities		10,336			10,641
Commitments and Contingencies (see Note 9)
Stockholders’ equity:
Common stock, $0.01 par value: Authorized shares - 20,000,000; Issued shares – 9,026,940 and 9,016,140 at September 30, 2024 and December 31, 2023, respectively;
0.01
Outstanding shares – 7,901,148 and 8,295,408 at September 30, 2024 and December 31, 2023, respectively		91			90
9,026,940
Additional paid-in capital		17,479			16,621
Outstanding shares – 7,786,679 at March 31, 2025 and December 31, 2024		92			91
Treasury stock, 1,125,792 and 720,732 shares at September 30, 2024 and December 31, 2023, respectively, at cost		(25,825	)		(20,359	)
Additional paid-in capital		18,400			17,928
Accumulated other comprehensive income (loss)		100			32
Treasury stock, 1,240,261 shares at March 31, 2025 and December 31, 2024, at cost		(27,997	)		(27,997	)
Accumulated income		59,842			56,320
Accumulated other comprehensive loss		(111	)		(93	)
Total stockholders’ equity		51,687			52,704
Accumulated income		63,674			61,768
Total liabilities and stockholders’ equity	$	62,808		$	63,826
Total stockholders’ equity		54,058			51,697
Total liabilities and stockholders’ equity	$	64,394		$	62,338

The accompanying notes are an integral part of these ~~Consolidated~~consolidated ~~Financial~~financial ~~Statements~~statements.

CoreCard Corporation

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited, in thousands, except share and per share amounts)

	Three Months Ended September 30,						Nine Months Ended September 30,
	Three Months Ended March 31,
	2024			2023			2024			2023
	2025			2024
Revenue
Services	$	1416,~~283~~688		$	13,~~399~~076		$	~~41,156~~		$	~~42,053~~
Products		~~1,420~~‒			-‒			~~1,420~~			~~1,794~~
Total net revenue		1516,~~703~~688			13,~~399~~076			~~42,576~~			~~43,847~~
Cost of revenue
Services		89,~~999~~380			9,~~279~~500			~~27,588~~			~~28,380~~
Products		-‒			-‒			-			-
Total cost of revenue		89,~~999~~380			9,~~279~~500			~~27,588~~			~~28,380~~
Expenses
Marketing		79136			63114			~~309~~			~~237~~
General and administrative		1,~~339~~794			1,~~155~~427			~~4,256~~			~~4,220~~
Development		2,~~501~~571			21,~~489~~508			~~5,961~~			~~6,094~~
Income from operations		2,~~785~~807			~~413~~527			~~4,462~~			~~4,916~~
Investment income (loss)		(90	)		(1,015	)		(528	)		(1,701	)
Investment loss		(435	)		(204	)
Other income (loss), net		233			308			758			653
Other income, net		137			256
Income (loss) before income taxes		2,928			(294	)		4,692			3,868
Income before income taxes		2,509			579
Income tax expense (benefit)		732			(72	)		1,170			959
Income taxes		603			149
Net income (loss)	$	2,196		$	(222	)	$	3,522		$	2,909
Net income	$	1,906		$	430
Earnings (loss) per share:
Earnings per share:
Basic	$	0.2824		$	(0.0305	)	$	~~0.44~~		$	~~0.34~~
Diluted	$	0.2724		$	(0.0305	)	$	~~0.43~~		$	~~0.34~~
Basic weighted average common shares outstanding		7,~~957~~786,~~571~~679			8,~~460~~236,~~473~~135			~~8,092,681~~			~~8,485,416~~
Diluted weighted average common shares outstanding		8,~~017~~086,~~870~~423			8,~~460~~247,~~473~~788			~~8,142,972~~			~~8,509,825~~

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME ~~(LOSS) (unaudited, in thousands)~~

	Three Months Ended September 30,						Nine Months Ended September 30,
	2024			2023			2024			2023
Net (loss) income	$	2,196		$	(222	)	$	3,522		$	2,909
Other comprehensive income (loss):
Unrealized gain (loss) on marketable securities		111			11			133			36
Foreign currency translation adjustments		(15	)		15			(65	)		(32	)
Total comprehensive (loss) income	$	2,292		$	(196	)	$	3,590		$	2,913

(unaudited, in thousands)

The accompanying notes are an integral part of these Consolidated Financial Statements.

	Three Months Ended March 31,
	2025			2024
Net income	$	1,906		$	430
Other comprehensive income (loss):
Unrealized gain (loss) on marketable securities		(1	)		5
Foreign currency translation adjustments		(17	)		(2	)
Total comprehensive income	$	1,888		$	433

4The accompanying notes are an integral part of these consolidated financial statements.

~~CoreCard Corporation~~4

~~CONSOLIDATED~~CoreCard ~~STATEMENTS OF STOCKHOLDERS’ EQUITY~~Corporation

~~(unaudited,~~CONSOLIDATED inSTATEMENTS ~~thousands,~~OF ~~except~~STOCKHOLDERS’ ~~share~~EQUITY ~~amounts)~~

	Common Stock					Additional Paid-In Capital		Treasury Stock			Accumulated Other Comprehensive Income (Loss)			Accumulated Earnings			Stockholders’ Equity
	Shares			Amount
Balance at December 31, 2022		8,502,735		$	90	$	16,471	$	(16,662	)	$	(61	)	$	52,925		$	52,763
Net income															1,256			1,256
Unrealized gain (loss) on marketable securities												37						37
Foreign currency translation adjustment												(53	)					(53	)
Balance at March 31, 2023		8,502,735		$	90	$	16,471	$	(16,662	)	$	(77	)	$	54,181		$	54,003
Common stock repurchased, including excise tax*		(18,075	)						(443	)								(443	)
Net income															1,875			1,875
Stock compensation expense		6,021			-		150											150
Unrealized gain (loss) on marketable securities												(12	)					(12	)
Foreign currency translation adjustment												6						6
Balance at June 30, 2023		8,490,681		$	90	$	16,621	$	(17,105	)	$	(83	)	$	56,056		$	55,579
Common stock repurchased*		(50,325	)						(1,108	)								(1,108	)
Net loss															(222	)		(222	)
Unrealized gain (loss) on marketable securities												11						11
Foreign currency translation adjustment												15						15
Balance at September 30, 2023		8,440,356		$	90	$	16,621	$	(18,213	)	$	(57	)	$	55,834		$	54,275
Balance at December 31, 2023		8,295,408		$	90	$	16,621	$	(20,359	)	$	32		$	56,320		$	52,704
Common stock repurchased, including excise tax*		(134,650	)						(1,647	)								(1,647	)
Net income															430			430
Stock compensation expense							160											160
Unrealized gain (loss) on marketable securities												5						5
Foreign currency translation adjustment												(2	)					(2	)
Balance at March 31, 2024		8,160,758		$	90	$	16,781	$	(22,006	)	$	35		$	56,750		$	51,650
Common stock repurchased, including excise tax*		(147,040	)						(2,091	)								(2,091	)
Net income															896			896
Stock compensation expense		10,800			1		424											425
Unrealized gain (loss) on marketable securities												17						17
Foreign currency translation adjustment												(48	)					(48	)
Balance at June 30, 2024		8,024,518		$	91	$	17,205	$	(24,097	)	$	4		$	57,646		$	50,849
Common stock repurchased*		(123,370	)						(1,728	)								(1,728	)
Net income															2,196			2,196
Stock compensation expense							274											274
Unrealized gain (loss) on marketable securities												111						111
Foreign currency translation adjustment												(15	)					(15	)
Balance at September 30, 2024		7,901,148		$	91	$	17,479	$	(25,825	)	$	100		$	59,842		$	51,687

(in thousands, except share amounts)

*At September 30, 2024, approximately $9.3 million was authorized for future repurchases of our common stock.

	Common Stock					Additional Paid-In Capital		Treasury Stock			Accumulated Other Comprehensive Income (Loss)			Accumulated Earnings		Stockholders’ Equity
	Shares			Amount
Balance at December 31, 2023		8,295,408		$	90	$	16,621	$	(20,359		$	32		$	56,320	$	52,704
Common stock repurchased*		(134,650	)						(1,647	)							(1,647	)
Net income															430		430
Stock compensation expense							160										160
Unrealized gain on marketable securities												5					5
Foreign currency translation adjustment												(2	)				(2	)
Balance at March 31, 2024		8,160,758		$	90	$	16,781	$	(22,006	)	$	35		$	56,750	$	51,650

Balance at December 31, 2024		7,786,679		$	91	$	17,928	$	(27,997	)	$	(93	)	$	61,768	$	51,697
Net income															1,906		1,906
Stock compensation expense					1		472										473
Unrealized gain (loss) on marketable securities												(1	)				(1	)
Foreign currency translation adjustment												(17	)				(17	)
Balance at March 31, 2025		7,786,679		$	92	$	18,400	$	(27,997	)	$	(111	)	$	63,674	$	54,058

~~The~~*At ~~accompanying~~March ~~notes~~31, ~~are~~2025, anapproximately ~~integral~~$7,115,000 ~~part~~was ofauthorized ~~these~~for ~~Consolidated~~future ~~Financial~~repurchases ~~Statements~~of our common stock.

5The accompanying notes are an integral part of these Consolidated Financial Statements.

~~CoreCard Corporation~~5

~~CONSOLIDATED~~CoreCard ~~STATEMENTS OF CASH FLOWS~~Corporation

~~(unaudited,~~CONSOLIDATED inSTATEMENTS ~~thousands)~~OF CASH FLOWS

	Nine Months Ended September 30,
CASH PROVIDED BY (USED FOR):	2024			2023
OPERATING ACTIVITIES:
Net income	$	3,522		$	2,909
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		2,776			5,011
Stock-based compensation expense		859			150
Deferred income taxes		(260	)		69
Non-cash investment loss (income)		-			1,000
Equity in loss of affiliate company		528			701
Changes in operating assets and liabilities:
Accounts receivable, net		216			7,345
Other current assets		(1,717	)		(2,329	)
Other long-term assets		17			563
Accounts payable		388			(78	)
Accrued payroll		287			53
Deferred revenue, current portion		(1,046	)		2,649
Accrued expenses		79			281
Other current liabilities		(506	)		40
Deferred revenue, net of current portion		(104	)		(112	)
Net cash provided by operating activities		5,039			18,252
INVESTING ACTIVITIES:
Purchases of property and equipment		(3,733	)		(4,845	)
Advances on notes and interest receivable		(200	)		(450	)
Proceeds from payments on notes receivable		152			147
Purchases of marketable securities		(1,831	)		(1,776	)
Maturities of marketable securities		1,728			1,602
Purchase of long-term investment		(98	)		(155	)
Net cash used for investing activities		(3,982	)		(5,477	)
FINANCING ACTIVITIES:
Repurchases of common stock		(5,412	)		(1,528	)
Net cash used for financing activities		(5,412	)		(1,528	)
Effects of exchange rate changes on cash		(65	)		(32	)
Net increase (decrease) in cash		(4,420	)		11,215
Cash at beginning of period		26,918			20,399
Cash at end of period	$	22,498		$	31,614
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for income taxes	$	1,070		$	168
Purchases of property and equipment, accrued but not paid	$	144		$	-

(unaudited, in thousands)

The accompanying notes are an integral part of these Consolidated Financial Statements.

	Three Months Ended March 31,
CASH PROVIDED BY (USED FOR):	2025			2024

OPERATING ACTIVITIES:
Net income	$	1,906		$	430
Adjustments to reconcile net income to net cash provided by (used for) operating activities:
Depreciation and amortization		745			1,025
Stock-based compensation expense		473			160
Provision (benefit) for deferred income taxes		40			(84	)
Equity in loss of affiliate company		516			239
Changes in operating assets and liabilities:
Accounts receivable, net		1,708			(653	)
Other current assets		(198	)		(222	)
Other long-term assets		(453	)		(41	)
Accounts payable		548			567
Accrued payroll		(515	)		(616	)
Deferred revenue, current portion		(106	)		(675	)
Accrued expenses		98			196
Other current liabilities		(192	)		305
Other long-term liabilities		66			–
Deferred revenue, net of current portion		(36	)		(79	)
Net cash provided by operating activities		4,600			552

INVESTING ACTIVITIES:
Purchase of marketable securities		(543	)		(362	)
Maturities of marketable securities		503			324
Purchases of property and equipment and capitalized internal-use software		(1,925	)		(1,593	)
Advances on notes receivable		–			(200	)
Purchase of long-term investment		(84	)		–
Proceeds from payments on notes receivable		53			50
Net cash used for investing activities		(1,996	)		(1,781	)

FINANCING ACTIVITIES:
Repurchases of common stock		–			(1,631	)
Net cash used for financing activities		–			(1,631	)

Effects of exchange rate changes on cash		(17	)		(2	)
Net increase (decrease) in cash		2,587			(2,862	)
Cash at beginning of period		19,481			26,918
Cash at end of period	$	22,068		$	24,056
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Purchases of property and equipment and capitalized internal-use software, accrued but not paid	$	225		$	262

6The accompanying notes are an integral part of these Consolidated Financial Statements.

~~CoreCard Corporation~~6

~~NOTES~~CoreCard ~~TO CONSOLIDATED FINANCIAL STATEMENTS~~Corporation

~~(unaudited)~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

~~1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES~~(unaudited)

~~Basis~~1. ofSUMMARY ~~Presentation~~OF SIGNIFICANT ACCOUNTING POLICIES

~~Throughout~~Basis this report, the terms “we”, “us”, “ours”, “CoreCard” and “Company” refer to CoreCard Corporation, including its wholly-owned and majority-owned subsidiaries. The unaudited Consolidated Financial Statements presented in this Form 10-Q have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) applicable to interim financial statements. Accordingly, they do not include all of the information and notes required for complete financial statements. In the opinion of CoreCard management, these Consolidated Financial Statements contain all adjustments (which comprise only normal and recurring accruals) necessary to present fairly the financial position and results of operations as of and for the three and nine month periods ended September 30, 2024 and 2023. The interim results for the three and nine months ended September 30, 2024 are not necessarily indicative of the results to be expected for the full year. These statements should be read in conjunction with our Consolidated Financial Statements and notes thereto for the fiscal year ended December 31, 2023, as filed in our Annual Report on Form 10-K.Presentation

~~There~~Throughout this report, the terms “we”, “us”, “ours”, “CoreCard” and “Company” refer to CoreCard Corporation, including its wholly-owned subsidiaries. The unaudited Consolidated Financial Statements presented in this Form 10-Q have been noprepared ~~material~~in ~~changes~~accordance with accounting principles generally accepted in the ~~Company’s~~United ~~significant~~States ~~accounting~~applicable ~~policies~~to ~~during~~interim financial statements. Accordingly, they do not include all of the ~~first~~information ~~nine~~and ~~months~~notes required for complete financial statements. In the opinion of ~~2024~~CoreCard management, these Consolidated Financial Statements contain all adjustments (which comprise only normal and recurring accruals) necessary to present fairly the financial position and results of operations as ~~compared~~of March 31, 2025 and December 31, 2024 and for the three month periods ended March 31, 2025 and 2024. The interim results for the three months ended March 31, 2025 are not necessarily indicative of the results to be expected for the ~~significant~~full ~~accounting~~year. ~~policies~~These ~~described~~statements should be read in ~~the~~conjunction ~~Company’s~~with ~~Annual~~our ~~Report~~Consolidated onFinancial ~~Form~~Statements ~~10-K~~and notes thereto for the fiscal year ended December 31, ~~2023~~2024, ~~(the~~as ~~“2023~~filed in our Annual Report on Form 10-K”).

~~Recent~~There ~~Accounting~~have ~~Pronouncements~~been ~~Not~~no ~~Yet~~material ~~Adopted~~changes in the Company’s significant accounting policies in the first quarter of 2025, as compared to the significant accounting policies described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Form 10-K”).

InRecent ~~November~~Accounting ~~2023,~~Pronouncements ~~the~~Not ~~FASB~~Yet issued ASU 2023-07, Improvements to Reportable Segment Disclosures (Amendments to Topic 280). This standard was issued to improve the disclosures about reportable segments and address requests from investors for additional, more detailed information about a reportable segment’s expenses by requiring disclosure of incremental segment information on an annual and interim basis to enable investors to develop more decision-useful financial analyses. Topic 280 currently requires certain information about its reportable segments. The amendments in the ASU do not change or remove those disclosure requirements. The amendments in this ASU are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The adoption of the ASU is on a retrospective basis. We will adopt the updated accounting guidance in our Annual Report on Form 10-K for the year ended December 31, 2024. We are currently evaluating the impact the adoption of the new accounting guidance will have on our segment disclosures.Adopted

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. This standard was issued to enhance the transparency and decision usefulness of income tax disclosures to provide information to better assess how an entity’s operations and related tax risks and tax planning and operational opportunities affect its tax rate and prospects for future cash flows. The amendments in this ASU address transparency about income tax information through disclosures primarily related to the rate reconciliation and income taxes paid information. The amendments in this ASU are effective for annual periods beginning after December 15, 2024. The ASU should be applied on a prospective basis. Retrospective application is permitted. We will adopt the updated accounting guidance in our Annual Report on Form 10-K for the year ended December 31, 2025. We are currently evaluating the impact the adoption of the new accounting guidance will have on our income tax disclosures.

WeIn ~~have~~November ~~considered~~2024, ~~all~~the ~~other~~FASB ~~recently~~ issued ~~accounting~~ASU ~~pronouncements~~2024-03, Income ~~and~~Statement-Reporting doComprehensive ~~not~~Income-Expense ~~believe~~Disaggregation ~~the~~Disclosures ~~adoption~~(Subtopic 220-40): Disaggregation of ~~such~~Income ~~pronouncements~~Statement ~~will~~Expenses, ~~have~~requiring apublic ~~material~~entities ~~impact~~to disclose additional information about specific expense categories in the notes to the financial statements on ~~our~~an ~~Consolidated~~interim ~~Financial~~and ~~Statements~~annual basis. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2024-03.

7We have considered all other recently issued accounting pronouncements and do not believe the adoption of such pronouncements will have a material impact on our Consolidated Financial Statements.

2.	REVENUE

Disaggregation of Revenue

In the following table, revenue is disaggregated by type of revenue for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2024~~2025 and ~~2023~~2024:

	Three Months Ended September 30,				Nine Months Ended September 30,
Three months ended March 31, (in thousands)	2025		2024
(in thousands)	2024		2023		2024		2023
License	$	–	$	–
License	$	1,420	$	-	$	1,420	$	1,794
Professional services		8,702		5,826
Professional services		7,006		6,432		19,805		22,127
Processing and maintenance		6,343		6,152
Processing and maintenance		6,067		5,814		17,912		16,933
Third party		1,643		1,098
Third party		1,210		1,153		3,439		2,993
Total	$	16,688	$	13,076
Total	$	15,703	$	13,399	$	42,576	$	43,847

~~Foreign revenues are based on the location of the customer. Revenues from customers by geographic area for the three and nine months ended September 30, 2024 and 2023 are as follows:~~7

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
United States	$	14,997	$	12,777	$	40,754	$	42,307
Middle East		678		588		1,740		1,452
European Union		28		34		82		88
Total	$	15,703	$	13,399	$	42,576	$	43,847

Foreign revenues are based on the location of the customer. Revenues from customers by geographic areas for the three months ended March 31, 2025 and 2024 are as follows:

Concentration of Revenue

Three months ended March 31, (in thousands)	2025		2024
United States	$	15,965	$	12,553
Middle East		694		496
European Union		29		27
Total	$	16,688	$	13,076

~~The~~Concentration ~~following table indicates the percentage~~ of consolidated revenue represented by each customer that represented more than 10 percent of consolidated revenue in the three and nine month periods ended September 30, 2024 and 2023. Most of our customers have multi-year contracts with recurring revenue as well as professional services fees that vary by period depending on their business needs.Revenue

	Three Months Ended September 30,						Nine Months Ended September 30,
	2024			2023			2024			2023
Customer A		64	%		62	%		62	%		68	%

The following table indicates the percentage of consolidated revenue represented by each customer that represented more than 10 percent of consolidated revenue in the three month periods ended March 31, 2025 and 2024. Most of our customers have multi-year contracts with recurring revenue as well as professional services fees that vary by period depending on their business needs.

3. NOTES RECEIVABLE

	Three Months Ended March 31,
	2025			2024
Customer A		65	%		59	%

~~In February 2021, we entered into and advanced a $550,000 Promissory Note with a privately held technology company and program manager in the FinTech industry~~3. ~~The~~NOTES note had an interest rate of 4.6 percent annually and was paid in full in August 2023. In 2023, we entered into and advanced $650,000 on a Promissory Note with a maturity date of October 2025 and an annual interest rate of 5.25 percent. In the first quarter of 2024, we entered into and advanced a $200,000 Promissory Note with a maturity date of October 2025 and an annual interest rate of 5.25 percent. The carrying value of the current portion of our notes receivable of $240,000 at September 30, 2024, is included in other current assets on the Consolidated Balance Sheets. The carrying value of the noncurrent portion of our note receivable of $403,000 as of September 30, 2024 is included in other long-term assets on the Consolidated Balance Sheets.RECEIVABLE

4In 2023, we entered into and advanced $650,000 on a Promissory Note with a privately held technology company and program manager in the Financial Technology (FinTech) industry with a maturity date of December 2028 and an annual interest rate of 5.25 ~~INVESTMENTS~~percent. In the first quarter of 2024, we entered into and advanced a $200,000 Promissory Note with a maturity date of December 2028 and an annual interest rate of 5.25 percent. The carrying value of the current portion of our notes receivable of $240,000 at March 31, 2025 is included in other current assets on the Consolidated Balance Sheets. The carrying value of the noncurrent portion of our note receivable of $299,000 at March 31, 2025 is included in other long-term assets on the Consolidated Balance Sheets.

~~We hold a 26~~4.5 percent ownership interest in a privately held identity and professional services company with ties to the FinTech industry. The carrying value of our investment was $3,378,000 at September 30, 2024, included in investments on the Consolidated Balance Sheets. We account for this investment using the equity method of accounting which resulted in losses of $90,000 and $528,000 for the three and nine months ended September 30, 2024, respectively, and losses of $15,000 and $701,000 for the three and nine months ended September 30, 2023, respectively, included in investment income (loss) on the Consolidated Statement of Operations. We evaluate on a continuing basis whether any impairment indicators are present that would require additional analysis or write-downs of the investment. While we have not recorded an impairment related to this investment as of September 30, 2024, variations from current expectations could result in future impairment charges. At September 30, 2024, the carrying value of this investment exceeded our share of the investee’s net assets by approximately $2.8 million. Substantially all of this difference is comprised of goodwill and other intangible assets.INVESTMENTS

InAs ~~the~~of ~~second~~March ~~quarter~~31, ~~of 2021~~2025, we ~~invested~~held ~~$1,000,000~~a 24.5 percent ownership interest in a privately held ~~company~~identity ~~that~~and ~~provides~~professional ~~supply~~services ~~chain~~company ~~and~~with ~~receivables~~ties ~~financing.~~to ~~During~~ the ~~third~~FinTech ~~quarter~~industry. The carrying value of ~~2023~~our investment was $3,007,000 ~~due~~at toMarch ~~the~~31, ~~failure~~2025, ofincluded in investments on the ~~business~~Consolidated toBalance ~~successfully~~Sheets. ~~monetize~~We ~~its~~account ~~product~~for ~~offerings,~~our weinvestment ~~recorded~~using anthe ~~impairment~~equity ~~charge~~method of accounting which resulted in losses of $1516,000 and $239,000 for the three months ended March 31, 2025 and 2024, respectively, included in investment ~~income (~~loss) on the Consolidated Statement of Operations. We evaluate on a continuing basis whether any impairment indicators are present that would require additional analysis or write-downs of the investment. The investee closed a funding round of $8.5 million in April 2025. CoreCard participated in the new investment and contributed an additional $300,000 in the fourth quarter of 2024 which diluted our ownership to ~~reduce~~20.2 percent once the fundraising round was closed. The valuation for the fundraise is above our carrying value and therefore no impairment indicators are present as of ~~the~~March ~~investee~~31, ~~company~~2025. While we have not recorded an impairment related to $0this investment as of ~~September~~March 3031, ~~2023~~2025, variations from current expectations could result in future impairment charges. InAt March 31, 2025, the ~~third~~carrying ~~quarter~~value of ~~2024,~~this ~~after~~investment exceeded our share of the investee’s ~~company~~net ~~signed~~assets ~~its~~by ~~first~~approximately ~~revenue~~$3.1 ~~contracts,~~million. weSubstantially ~~invested~~all anof ~~additional~~this ~~$98,000~~difference asis ~~part~~comprised of agoodwill ~~Series~~and ~~A-2~~other ~~financing~~intangible assets.

8As of March 31, 2025, we held a 12.5 percent ownership interest in a privately held company that provides supply chain and receivables financing with a carrying value of $182,000, recorded at cost and reduced by any impairments, included in investments on the Consolidated Balance Sheets. We also held a 3.4 percent ownership interest in a privately held technology company and program manager in the FinTech industry with a carrying value of $155,000, recorded at cost and reduced by any impairments, included in investments on the Consolidated Balance Sheets.

5.	STOCK-BASED COMPENSATION

At ~~September~~March 3031, ~~2024~~2025, we had two stock-based compensation plans in effect. We record compensation cost related to unvested stock awards by recognizing the unamortized grant date fair value on a straight-line basis over the vesting periods of each award. We have estimated forfeiture rates based on our historical experience. Stock option compensation expense for the three and nine month periods ended September 30, 2024 and 2023 has been recognized as a component of general and administrative expenses and development expenses in the accompanying Consolidated Financial Statements. We recorded $~~274~~473,000 and $0160,000 of stock-based compensation expense ~~for~~during the ~~three~~quarters ~~months~~ ended ~~September~~March 3031, ~~2024~~2025 and ~~2023, respectively, and $859,000 and $150,000 for the nine months ended September 30,~~ 2024 ~~and 2023~~, respectively.

~~Stock Options~~8

AsStock ofOptions September 30, 2024, there was no unrecognized compensation cost related to stock options. There were no options exercised during the three and nine months ended September 30, 2024. No options expired unexercised during the quarter. The following table summarizes options as of September 30, 2024:

Options Outstanding and Exercisable:
Range of Exercise Price			Number Outstanding		Wgt. Avg. Contractual Life Remaining (in years)		Wgt. Avg. Exercise Price		Aggregate Intrinsic Value
$3.50	-	$3.86		13,000		2.5	$	3.75	$	140,020
$7.80				8,000		3.7	$	7.80	$	53,760
$19.99				30,000		4.3	$	19.99	$	-
$39.11				8,000		4.7	$	39.11	$	-
$3.50	-	$39.11		59,000		3.9	$	17.35	$	193,780

As of March 31, 2025, there was no unrecognized compensation cost related to stock options. There were no options exercised during the three months ended March 31, 2025 or 2024. No options were granted during the three months ended March 31, 2025 or 2024. The following table summarizes options as of March 31, 2025:

The estimated fair value of options granted is calculated using the Black-Scholes option pricing model with assumptions as previously disclosed in our 2023 Form 10-K.

Options Outstanding and Exercisable:
Range of Exercise Price			Number Outstanding		Wgt. Avg. Contractual Life Remaining (in years)		Wgt. Avg. Exercise Price		Aggregate Intrinsic Value
$3.50	-	$3.86		13,000		2.0	$	3.75	$	194,490
$7.80				8,000		3.2	$	7.80	$	87,280
$19.99				30,000		3.8	$	19.99	$	–
$39.11				8,000		4.2	$	39.11	$	–
$3.50	-	$39.11		59,000		3.4	$	17.35	$	281,770

The ~~aggregate~~estimated ~~intrinsic~~fair value ~~in the table above represents the total pre-tax intrinsic value (the difference between the Company’s closing stock price on the last trading day~~ of ~~the~~options ~~third~~granted ~~quarter~~is ofcalculated ~~2024~~using ~~and~~ the ~~exercise price, multiplied by the number of in~~Black-~~the-money~~Scholes ~~options) that would have been received by the~~ option ~~holders~~pricing ~~had~~model ~~all~~with ~~option~~assumptions ~~holders~~as ~~exercised~~previously ~~their~~disclosed ~~options~~in onour ~~September 30,~~ 2024. ~~The~~Form ~~amount of aggregate intrinsic value will change based on the market value of the Company’s stock~~10-K.

~~Restricted~~The ~~Stock~~aggregate ~~Units~~intrinsic value in the table above represents the total pre-tax intrinsic value (the difference between the Company’s closing stock price on the last trading day of the first quarter of 2025 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on March 31, 2025. The amount of aggregate intrinsic value will change based on the market value of the Company’s stock.

Restricted Stock Units~~, or RSUs, generally vest at the end of a three-year vesting period. A summary of the Company’s RSU activity was as follows:~~

	Number of Restricted Stock Units			Weighted-average grant date fair value per share
Balance as of December 31, 2023		-		$	-
Granted		287,485			12.34
Vested		-			-
Canceled and forfeited		(2,473	)		12.34
Balance as of September 30, 2024		285,012		$	12.34

Restricted Stock Units, or RSUs, generally vest at the end of a three-year vesting period. A summary of the Company’s RSU activity was as follows:

As of September 30, 2024, unrecognized compensation costs related to unvested RSUs was $2.6 million, which we expect to recognize over a weighted-average period of 2.4 years. In October 2024, we granted an additional 198,912 RSUs to long-term employees at a grant date fair value of $2.6 million that vest at the end of a three-year vesting period.

	Number of Restricted Stock Units			Weighted-average grant date fair value per share
Balance as of December 31, 2024		479,998		$	12.59
Granted		–			–
Vested		–			–
Canceled and forfeited		(2,693	)		12.81
Balance as of March 31, 2025		477,305		$	12.58

9Stock compensation expense was classified as follows for the three months ended March 31, 2025 and 2024:

6. FAIR VALUE OF FINANCIAL INSTRUMENTS

Three months ended March 31, (in thousands)	2025		2024
General and administrative expense	$	38	$	160
Development expense		435		–
Total	$	473	$	160

~~The~~As ~~carrying value~~ of ~~cash~~March ~~and cash equivalents~~31, ~~marketable securities~~2025, ~~accounts~~unrecognized ~~receivable,~~compensation ~~notes~~costs ~~receivable,~~related ~~accounts~~to ~~payable~~unvested ~~and~~RSUs ~~certain~~was ~~other~~$4.0 ~~financial instruments (such as accrued expenses~~million, ~~and~~which ~~other~~we ~~current~~expect ~~liabilities)~~to ~~included~~recognize inover ~~the~~a ~~accompanying Consolidated Balance Sheets approximates their fair value principally due to the short~~weighted-~~term~~average ~~maturity~~period of ~~these~~2.1 ~~instruments~~years.

~~Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash, marketable securities, trade accounts and notes receivable~~6. ~~Our~~FAIR ~~available~~VALUE ~~cash~~OF isFINANCIAL held in accounts managed by third-party financial institutions. Cash may exceed the Federal Deposit Insurance Corporation, or FDIC, insurance limits. While we monitor cash balances on a regular basis and adjust the balances as appropriate, these balances could be impacted if the underlying financial institutions fail. To date, we have experienced no loss or lack of access to our cash; however, we can provide no assurances that access to our cash will not be impacted by adverse conditions in the financial markets.INSTRUMENTS

7.The ~~FAIR~~carrying ~~VALUE~~value ~~MEASUREMENTS~~of cash, marketable securities, accounts receivable, accounts payable and certain other financial instruments (such as accrued expenses, and other current liabilities) included in the accompanying consolidated balance sheets approximates their fair value principally due to the short-term maturity of these instruments.

In determining fair value, the Company uses quoted market prices in active markets. GAAP establishes a fair value measurement framework, provides a single definition of fair value, and requires expanded disclosure summarizing fair value measurements. GAAP emphasizes that fair value is a market-based measurement, not an entity specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing an asset or liability.9

~~GAAP~~Financial ~~establishes~~instruments athat ~~hierarchy~~potentially ~~for~~subject ~~inputs~~us ~~used~~to inconcentrations ~~measuring~~of ~~fair~~credit ~~value~~risk ~~that~~consist ~~maximizes~~principally ~~the use~~ of ~~observable~~cash, ~~inputs~~marketable securities and ~~minimizes~~trade ~~the~~accounts. ~~use~~Our ofavailable ~~unobservable~~cash ~~inputs~~is held in accounts managed by ~~requiring~~third-party ~~that~~financial institutions. Cash may exceed the ~~most~~Federal ~~observable~~Deposit ~~input~~Insurance beCorporation, ~~used~~or ~~when~~FDIC, ~~available~~insurance limits. ~~Observable~~While ~~inputs~~we ~~are~~monitor ~~based~~cash balances on ~~data~~a ~~obtained~~regular ~~from~~basis ~~sources~~and ~~independent~~adjust of the ~~Company~~balances ~~that~~as ~~market~~appropriate, ~~participants~~these ~~would~~balances ~~use~~could inbe ~~pricing~~impacted if the ~~asset~~underlying orfinancial ~~liability~~institutions fail. ~~Unobservable~~To ~~inputs~~date, ~~are~~we ~~inputs~~have ~~that~~experienced ~~reflect~~no ~~the~~loss ~~company’s~~or ~~assumptions~~lack ~~about~~of ~~the~~access ~~estimates~~to ~~market~~our ~~participants~~cash; ~~would~~however, ~~use~~we incan ~~pricing~~provide ~~the~~no ~~asset~~assurances orthat ~~liability~~access ~~developed~~to ~~based~~our oncash ~~the~~will ~~best~~not ~~information~~be ~~available~~impacted by adverse conditions in the ~~circumstances~~financial markets.

~~The~~7. ~~hierarchy~~FAIR isVALUE ~~measured in three levels based on the reliability of inputs:~~MEASUREMENTS

•In ~~Level~~determining 1fair value, the Company uses quoted market prices in active markets. GAAP establishes a fair value measurement framework, provides a single definition of fair value, and requires expanded disclosure summarizing fair value measurements. GAAP emphasizes that fair value is a market-based measurement, not an entity specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing an asset or liability.

~~Valuations~~GAAP establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable input be used when available. Observable inputs are based on ~~quoted~~data ~~prices~~obtained infrom ~~active~~sources ~~markets~~independent ~~for~~of ~~identical~~the ~~assets~~Company that market participants would use in pricing the asset or ~~liabilities~~liability. Unobservable inputs are inputs that wereflect ~~have~~the company’s assumptions about the ~~ability~~estimates tomarket ~~access.~~participants ~~Valuation~~would ~~adjustments~~use ~~and~~in ~~block~~pricing ~~discounts~~the ~~are~~asset ~~not~~or ~~applied~~liability todeveloped ~~Level~~based 1on ~~instruments~~the best information available in the circumstances.

•The ~~Level~~hierarchy 2is measured in three levels based on the reliability of inputs:

~~Valuations~~• ~~based~~Level ~~on quoted prices in less active, dealer or broker markets. Fair values are primarily obtained from third party pricing services for identical or comparable assets or liabilities.~~1

•Valuations based on quoted prices in active markets for identical assets or liabilities that we have the ability to access. Valuation adjustments and block discounts are not applied to Level 31 instruments.

~~Valuations~~• ~~derived from other valuation methodologies, including pricing models, discounted cash flow models and similar techniques, and not based on market, exchange, dealer, or broker-traded transactions.~~ Level 3 valuations incorporate certain assumptions and projections that are not observable in the market and significant professional judgment is needed in determining the fair value assigned to such assets or liabilities.2

InValuations ~~instances where the determination of the fair value measurement is~~ based on ~~inputs~~quoted ~~from~~prices ~~different~~in ~~levels~~less ~~of the fair value hierarchy~~active, ~~the~~dealer ~~level~~or inbroker ~~the~~markets. ~~fair~~Fair ~~value~~values ~~hierarchy~~are ~~within~~primarily ~~which~~obtained ~~the~~from ~~entire~~third ~~fair~~party ~~value~~pricing ~~measurement~~services ~~falls~~for isidentical ~~based~~or oncomparable ~~the~~assets ~~lowest~~or ~~level input that is significant to the fair value measurement in its entirety~~liabilities.

~~The~~• ~~fair~~Level value of equity method investments has not been determined as it was impracticable to do so due to the fact that the investee companies are relatively small, early stage private companies for which there is no comparable valuation data available without unreasonable time and expense.3

~~The~~Valuations ~~following~~derived ~~tables~~from ~~present~~other ~~the~~valuation ~~fair~~methodologies, ~~value~~including ~~hierarchy~~pricing ~~for~~models, ~~assets~~discounted cash flow models and ~~liabilities~~similar ~~measured~~techniques, atand not based on market, exchange, dealer, or broker-traded transactions. Level 3 valuations incorporate certain assumptions and projections that are not observable in the market and significant professional judgment is needed in determining the fair value: assigned to such assets or liabilities.

	September 30, 2024
(In thousands)	Level 1		Level 2		Level 3		Total Fair Value
Cash equivalents
Money market accounts	$	16,805	$	−	$	−	$	16,805
Marketable securities
Corporate, municipal debt and treasury securities		5,511		−		−		5,511
Total assets	$	22,316	$	−	$	−	$	22,316

In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety.

10The fair value of equity method investments has not been determined as it was impracticable to do so due to the fact that the investee companies are relatively small, early-stage private companies for which there is no comparable valuation data available without unreasonable time and expense.

The ~~Company~~following ~~classifies~~tables ~~money~~present ~~market funds, commercial paper, U.S. government securities, asset-backed securities and corporate securities within Level 1 or Level 2 of~~ the fair value hierarchy ~~because~~for ~~the~~assets ~~Company values these investments using quoted market prices or alternative pricing sources~~ and ~~models~~liabilities ~~utilizing~~measured ~~market~~at ~~observable~~fair ~~inputs.~~value:

There were no transfers of financial instruments between the fair value hierarchy levels during the nine months ended September 30, 2024 or 2023.

	March 31, 2025
(In thousands)	Level 1		Level 2		Level 3		Total Fair Value
Cash equivalents
Money market accounts	$	16,349	$	−	$	−	$	16,349
Marketable securities
Corporate and municipal debt securities		5,575		−		−		5,575
Total assets	$	21,924	$	−	$	−	$	21,924

8The Company classifies money market funds, commercial paper, U.S. ~~MARKETABLE~~government ~~SECURITIES~~securities, asset-backed securities and corporate securities within Level 1 or Level 2 of the fair value hierarchy because the Company values these investments using quoted market prices or alternative pricing sources and models utilizing market observable inputs.

~~The amortized cost, unrealized gain (loss), and estimated fair value of the Company’s investments in securities available for sale consisted of the following:~~10

	September 30, 2024
(In thousands)	Amortized Cost		Unrealized Gain		Unrealized Loss		Estimated Fair Value
Marketable securities
Corporate, municipal debt and treasury securities	$	5,321	$	190	$	−	$	5,511

There were no transfers of financial instruments between the fair value hierarchy levels during the three months ended March 31, 2025.

~~The Company had one marketable security in an unrealized loss position as of September 30, 2024~~8. ~~The~~MARKETABLE Company did not identify any marketable securities that were other-than-temporarily impaired as of September 30, 2024 and 2023. The Company does not intend to sell any marketable securities that have an unrealized loss at September 30, 2024 and it is not more likely than not that the Company will be required to sell such securities before any anticipated recovery.SECURITIES

The ~~following~~amortized ~~table~~cost, ~~summarizes~~unrealized ~~the~~gain ~~stated~~(loss), ~~maturities~~and estimated fair value of the Company’'s ~~marketable~~investments in securities available for sale consisted of the following:

	September 30, 2024				December 31, 2023
	March 31, 2025
(In thousands)	Amortized Cost		~~Fair~~Unrealized ~~Value~~Gain		~~Amortized~~Unrealized ~~Cost~~Loss			Estimated Fair Value
Due within one year	$	1,229	$	1,271	$	1,506		$	1,556
Marketable securities
Due after one year through three years		4,092		4,240		3,607			3,674
Corporate and municipal debt securities	$	5,398	$	178	$	(1	)	$	5,575
Total	$	5,321	$	5,511	$	5,113		$	5,230

9The Company had one marketable security in an unrealized loss position as of March 31, 2025. ~~COMMITMENTS~~The ~~AND~~Company ~~CONTINGENCIES~~did not identify any marketable securities that were other-than-temporarily impaired as of March 31, 2025 and December 31, 2024. The Company does not intend to sell any marketable securities that have an unrealized loss at March 31, 2025, and it is not more likely than not that the Company will be required to sell such securities before any anticipated recovery. We recognized investment income of $81,000 and $35,000 for the three months ended March 31, 2025 and 2024, respectively, included in investment loss on the Consolidated Statement of Operations.

~~Leases~~The following table summarizes the stated maturities of the Company’s marketable securities:

We have noncancelable operating leases for offices and data centers expiring at various dates through March 2029. These operating leases are included in other long-term assets on the Company’s September 30, 2024 and December 31, 2023 Consolidated Balance Sheets and represent the Company’s right to use the underlying asset for the lease term. The Company’s obligation to make lease payments are included in other current liabilities and long-term lease obligation on the Company’s September 30, 2024 and December 31, 2023 Consolidated Balance Sheets. Operating lease right-of-use assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. Because the rate implicit in each lease is not readily determinable, the Company uses its incremental borrowing rate to determine the present value of the lease payments.

	March 31, 2025				December 31, 2024
(In thousands)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Due within one year	$	1,805	$	1,875	$	1,565	$	1,630
Due after one year through five years		3,593		3,700		3,689		3,780
Total	$	5,398	$	5,575	$	5,254	$	5,410

~~Supplemental~~9. ~~Information–Leases~~COMMITMENTS AND CONTINGENCIES

~~Supplemental information related to our right-of-use assets and related lease liabilities is as follows:~~Leases

	September 30, 2024			December 31, 2023
Right-of-use asset, net and lease liabilities (in thousands)	$	3,049		$	2,003
Weighted average remaining lease term (years)		3.4			2.8
Weighted average discount rate		6.4	%		3.4	%

We have noncancelable operating leases for offices and data centers expiring at various dates through April 2030 , one of which commenced on May 1, 2025 and therefore not included on the Consolidated Balance Sheet as of March 31, 2025. The future minimum lease payments for this lease are $3,058,000 over five years. The remaining operating leases are included in other long-term assets on the Company's March 31, 2025 and December 31, 2024 Consolidated Balance Sheets and represent the Company’s right to use the underlying asset for the lease term. The Company’s obligation to make lease payments are included in other current liabilities and long-term lease obligations on the Company's March 31, 2025 and December 31, 2024 Consolidated Balance Sheets. Operating lease right-of-use assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. Because the rate implicit in each lease is not readily determinable, the Company uses its incremental borrowing rate to determine the present value of the lease payments.

~~For~~Supplemental ~~the nine-months ended September 30, 2024 and 2023, cash paid for operating leases included in operating cash flows was $1,005,000 and $994,000, respectively.~~Information–Leases

11Supplemental information related to our right-of-use assets and related lease liabilities is as follows:

Maturities of our operating lease liabilities as of September 30, 2024 is as follows:

	March 31, 2025			December 31, 2024

Right-of-use asset, net and lease liabilities (in thousands)	$	2,508		$	2,747
Weighted average remaining lease term (years)		3.1			3.5
Weighted average discount rate		6.8	%		6.6	%

	Operating Leases
	(in thousands)
2024	$	362
2025		1,133
2026		1,045
2027		521
2028		440
Thereafter		111
Total lease liabilities	$	3,612

For the three months ended March 31, 2025 and 2024, cash paid for operating leases included in operating cash flows was $364,000 and $299,000, respectively.

~~Lease expense for the three and nine months ended September 30, 2024 and 2023 consisted of the following:~~11

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Cost of Revenue	$	209	$	187	$	594	$	557
General and Administrative		121		116		359		339
Development		32		28		68		109
Total	$	362	$	331	$	1,021	$	1,005

Maturities of our operating lease liabilities as of March 31, 2025 is as follows:

Legal Matters

	Operating Leases
	(In thousands)


2025		795
2026		1,042
2027		521
2028		440
2029		111
Total lease payments		2,909
Less imputed interest		(401	)
Total operating lease liabilities	$	2,508

~~There~~Lease ~~are~~expense nofor ~~pending~~the orthree ~~threatened~~months ~~legal~~ended ~~proceedings.~~March ~~However~~31, in2025 ~~the~~and ~~ordinary~~2024 ~~course~~consisted of ~~business, from time to time we may be involved in various pending or threatened legal actions. The litigation process is inherently uncertain, and it is possible that~~ the ~~resolution of such matters might have a material adverse effect upon our financial condition and/or results of operations. We accrue for unpaid legal fees for services performed to date.~~following:

10. INCOME TAXES

	Three Months Ended
	March 31, 2025		March 31, 2024
(in thousands)
Cost of Revenue	$	209	$	176
General and Administrative		123		119
Development		32		4
Total	$	364	$	299

WeRetention recognize deferred tax liabilities and assets for the expected future tax consequences of events that have been included in the financial statements or tax returns. Deferred tax liabilities and assets are determined based on the difference between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are recognized, net of a valuation allowance, for the estimated future tax effects of deductible temporary differences and tax credit carry-forwards. A valuation allowance against deferred tax assets is recorded when, and if, based upon available evidence, it is more likely than not that some or all deferred tax assets will not be realized.Liability

~~There~~ On ~~were~~May no7, ~~unrecognized~~2025, ~~tax~~the ~~benefits~~Board atof ~~September~~Directors 30approved a retention program for employees who, ~~2024~~as ~~and~~of ~~December~~July 31, ~~2023~~2024, have been employees of the Company for more than five years. Under ~~Our~~the ~~policy~~program, iswe agreed to ~~recognize~~make ~~interest~~a ~~and~~cash ~~penalties~~retention ~~accrued~~payment onto each covered employee equal to the amount, if any, ~~unrecognized~~by ~~tax~~which ~~benefits~~the employee’s 2024 base salary exceeds the value, measured as aof ~~component~~close of ~~income~~trading ~~tax~~on ~~expense.~~December ~~There~~31, ~~were~~2028, noof ~~accrued~~the ~~interest~~shares orof ~~penalties~~restricted ~~associated~~stock ~~with~~granted ~~any~~to ~~unrecognized~~such ~~tax~~employee ~~benefits~~in 2024 and 2025 that are vested as of December 31, ~~nor~~2028. ~~was~~The ~~any~~maximum ~~interest~~liability ~~expense~~under ~~recognized~~this ~~during~~plan is approximately $14,325,000 and we expect to evaluate the ~~periods~~liability ~~presented~~and corresponding service cost on a quarterly basis. WeThe ~~have~~program ~~determined~~is wefurther ~~have~~described noin ~~uncertain~~Part ~~tax~~II, ~~positions~~Item 5, of this Quarterly Report on Form 10-Q.

WeLegal file a consolidated U.S. federal income tax return for all subsidiaries in which our ownership equals or exceeds 80%, as well as individual subsidiary returns in various states and foreign jurisdictions. With few exceptions we are no longer subject to U.S. federal, state and local or foreign income tax examinations by taxing authorities for returns filed more than three years ago.Matters

12There are no pending or threatened legal proceedings. However, in the ordinary course of business, from time to time we may be involved in various pending or threatened legal actions. The litigation process is inherently uncertain, and it is possible that the resolution of such matters might have a material adverse effect upon our financial condition and/or results of operations. We accrue for unpaid legal fees for services performed to date.

10.

SEGMENT INFORMATION

The Company operates as one operating segment. The Company's chief operating decision maker ("CODM") is its chief executive officer, who reviews financial information presented on a consolidated basis. The CODM uses consolidated operating margin and net income to assess financial performance and allocate resources. These financial metrics are used by the CODM to make key operating decisions, such as the determination of the rate at which the Company seeks to grow its operating margin and the allocation of resources between cost of revenues, marketing, development, and general and administrative expenses.

The following table presents selected financial information with respect to the Company’s single operating segment for the three months ended March 31, 2025 and 2024:

Three months ended March 31, (in thousands, except per share data):	2025			2024

Revenue	$	16,688		$	13,076
Less:
Cost of revenue		9,380			9,500
Marketing		136			114
General and administrative		1,794			1,427
Development		2,571			1,508
Operating Income		2,807			527
Operating Margin		16.8	%		4.0	%

Other income (expense)
Investment loss		(435	)		(204	)
Other income		137			256
Income before income taxes		2,509			579
Provision for income taxes		(603	)		(149	)
Net income	$	1,906		$	430

11.

INCOME TAXES

We recognize deferred tax liabilities and assets for the expected future tax consequences of events that have been included in the financial statements or tax returns. Deferred tax liabilities and assets are determined based on the difference between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are recognized, net of a valuation allowance, for the estimated future tax effects of deductible temporary differences and tax credit carry-forwards. A valuation allowance against deferred tax assets is recorded when, and if, based upon available evidence, it is more likely than not that some or all deferred tax assets will not be realized.

There were no unrecognized tax benefits at March 31, 2025 and December 31, 2024. Our policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. There were no accrued interest or penalties associated with any unrecognized tax benefits, nor was any interest expense recognized during the periods presented. We have determined we have no uncertain tax positions.

We file a consolidated U.S. federal income tax return for all subsidiaries in which our ownership equals or exceeds 80%, as well as individual subsidiary returns in various states and foreign jurisdictions. With few exceptions we are no longer subject to U.S. federal, state and local or foreign income tax examinations by taxing authorities for returns filed more than three years ago.

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

In addition to historical information, this Form 10-Q may contain forward-looking statements relating to CoreCard. All statements, trend analyses and other information relative to markets for our products and trends in revenue, gross margins and anticipated expense levels, as well as other statements including words such as “anticipate”, “believe”, “plan”, “estimate”, “expect”, and “intend”, and other similar expressions, constitute forward-looking statements. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties including those factors described below under “Factors That May Affect Future Operations”, and that actual results may differ materially from those contemplated by such forward-looking statements. CoreCard undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes in future operating results.

For purposes of this discussion and analysis, we are assuming and relying upon the reader’s familiarity with the information contained in Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations, in the Form 10- K for the year ended December 31, ~~2023~~2024 as filed with the Securities and Exchange Commission.

Overview

CoreCard Corporation, a Georgia corporation, and its predecessor companies have operated since 1973 and its securities have been publicly traded since 1980. In this report, sometimes we use the terms “Company”, “CoreCard”, “us”, “ours”, “we”, “Registrant” and similar words to refer to CoreCard Corporation and subsidiaries. Our executive offices are located in Norcross, Georgia and our website is www.corecard.com.

We are primarily engaged in the business of providing technology solutions and processing services to the financial technology and services market, commonly referred to as the FinTech industry. Our revenue comes from a number of different offerings to companies in that industry, including the following:13

•We ~~Licenses~~are ~~which~~primarily ~~allow~~engaged ain ~~customer~~the business of providing technology solutions and processing services to ~~use~~the financial technology and services market, commonly referred to as the FinTech industry. Our operations are conducted through our subsidiary companies located in Romania, India, the United Arab Emirates and Colombia, as well as our corporate office in Norcross, Georgia which provides significant administrative, human resources and executive management support. CoreCard’s foreign subsidiaries that perform software ~~for~~development aand ~~specified~~testing ~~number~~as ofwell ~~active~~as ~~accounts~~processing onoperations support are CoreCard SRL in Romania, CoreCard Software Pvt Ltd in India, CoreCard Colombia SAS in Colombia and CoreCard Software DMCC in the ~~system;~~United Arab Emirates.

• Professional services for development of new features or system functionality;

• Support and maintenance services tied to the number of active accounts under license; and

• Processing services based on the number of active accounts on the system.

Our operations are conducted through our affiliate companies located in Romania, India, the United Arab Emirates and Colombia, as well as our corporate office in Norcross, Georgia which provides significant administrative, human resources and executive management support. CoreCard’s foreign subsidiaries that perform software development and testing as well as processing operations support are CoreCard SRL in Romania, CoreCard Software Pvt Ltd in India, CoreCard Colombia SAS in Colombia and CoreCard Software DMCC in the United Arab Emirates.

Our results vary in part depending on the size and number of software licenses recognized as well as the value and number of professional services contracts recognized in a particular period. As we continue to grow our Processing Services business, we continue to gain economies of scale on the investments we have made in the infrastructure, resources, processes and software features developed over the past number of years to support this growing side of our business. We are adding new processing customers at a faster pace than we are adding new license customers, resulting in steady growth in the processing revenue stream.

We ~~also~~ receive license revenue and professional services revenue, including such revenue from Goldman Sachs Group, Inc. (“Goldman”), which was added as a customer in 2018, ~~and is~~ referred to as “Customer A” in the Notes to Consolidated Financial Statements. In total, this customer represented 6265% and 6859% of our consolidated revenues in the first ~~nine~~quarters ~~months~~ of ~~2024~~2025 and ~~2023~~2024, respectively. On October 23, 2024, we executed an Omnibus Amendment with Goldman covering the following agreements between the Company and Goldman:

●

Software License and Support Agreement, dated as of October 16, 2018 (the “SLSA”);

●

Master Professional Services Agreement, dated as of August 1, 2019 (the “MPSA”, and together with the SLSA, the “Agreements”);

●

Schedule of Work No. 1 to Professional Services Agreement, dated as of August 1, 2019, and Amendment No. 2 to Schedule of Work No. 1, dated as of January 13, 2021 (“SOW 1”); and

●

Schedule of Work No. 2 to Professional Services Agreement, dated as of August 1, 2019, and Amendment No. 2 to Schedule of Work No. 2, dated as of January 13, 2021 (“SOW 2”, and together with SOW 1, the “SOWs”).

13The Omnibus Amendment, which is effective as of October 23, 2024, extends the Support Services term of the SLSA through December 31, 2030, and extends the term of the SOWs through December 31, 2030. Among other things, the Amendment also (i) provides for increased monthly fees under SOW 2 starting January 2025, and (ii) allows Goldman to terminate the agreements no earlier than January 1, 2027, with termination payments due if terminated prior to December 31, 2030. All other material terms of the Agreements and SOWs, as amended, remain unchanged.

The Amendment, which is effective as of October 23, 2024, extends the Support Services term of the SLSA through December 31, 2030, and extends the term of the SOWs through December 31, 2030. Among other things, the Amendment also (i) provides for increased monthly fees under SOW 2 starting January 2025, and (ii) allows Goldman to terminate the agreements no earlier than January 1, 2027, with termination payments due if terminated prior to December 31, 2030. All other material terms of the Agreements and SOWs, as amended, remain unchanged.

The amount and timing of future revenues from Goldman will be dependent on various factors not in our control such as the number of accounts on file and the level of customization needed by the customer and whether the customer continues the credit card line of business. License revenue from this customer, similar to other license arrangements, is tiered based on the number of active accounts on the system. Once the customer achieves each tier level, they receive a perpetual license up to that number of accounts; inactive accounts do not count toward the license tier. The customer receives an unlimited perpetual license at a maximum tier level that allows them to utilize the software for any number of active accounts. Support and maintenance fees are charged based on the tier level achieved and increase at new tier levels.

Goldman recently announced the transition of its General Motors co-branded credit card to a new issuer, which is processed under our agreement with Goldman, with an expected close in 2025. Sale of the loans by Goldman will not affect the maintenance revenue that we receive under the agreement, which is set based on the most recently achieved license tier. However, the removal of active accounts following a sale of the loans will proportionately increase the number of accounts that will need to be added to earn the license fees attributable to the next license tier under the agreement. Additionally, selling one of their two portfolios could make it more likely that Goldman will exit the credit card business.

The infrastructure of our multi customer environment is designed to be scalable for the future. A significant portion of our expense is related to personnel, including approximately 1,000 employees located in India, Romania, the United Arab Emirates and Colombia. In October 2020, we opened a new office in Dubai, ~~the~~ United Arab Emirates to support CoreCard’s expansion of processing services into new markets in the Asia Pacific, Middle East, Africa and European regions. In October 2021, we opened a new location in Bogotá, Colombia to support existing customers and continued growth. Our ability to hire and train employees on our processes and software impacts our ability to onboard new customers and deliver professional services for software customizations. In addition, we have certain corporate office expenses associated with being a public company that impact our operating results.

Our revenue fluctuates from period to period and our results are not necessarily indicative of the results to be expected in future periods. It is difficult to predict the level of consolidated revenue on a quarterly or annual basis for a number of reasons, including the following:

●

Software license revenue in a given period may consist of a relatively small number of contracts and contract values can vary considerably depending on the software product and scope of the license sold. Consequently, even minor delays in delivery under a software contract (which may be out of our control) could have a significant and unpredictable impact on the consolidated revenue that we recognize in a given quarterly or annual period.

●	Customers may decide to postpone or cancel a planned implementation of our software for any number of reasons, which may be unrelated to our software or contract performance, but which may affect the amount, timing and characterization of our deferred and/or recognized revenue.

●	Customers typically require our professional services to modify or enhance their CoreCard software implementation based on their specific business strategy and operational requirements, which vary from customer to customer and period to period.

●	The timing of new processing customer implementations is often dependent on third party approvals or processes which are typically not under our direct control.

We continue to believe that we have a strong cash position, and we intend to use cash balances to support the domestic and international operations associated with our CoreCard business and to expand our operations in the FinTech industry through financing the growth of CoreCard and, if appropriate opportunities become available, through acquisitions of businesses in this industry. In May 2022, the Board of Directors of the Company (the “Board”) authorized a new $20 million share repurchase program, and we had approximately $97.31 million of authorized share repurchases remaining asat ofMarch ~~September 30~~31, ~~2024~~2025.

Results of Operations

The following discussion should be read in conjunction with the ~~unaudited~~ Consolidated Financial Statements and the ~~Notes~~notes to Consolidated Financial Statements presented in this quarterly report.

Revenue – Total revenue in the three ~~and nine~~ -month ~~periods~~period ended ~~September~~March 3031, ~~2024~~2025 was $1516,~~703~~688,000 ~~and $42~~,~~576,000,~~ ~~respectively,~~ which represents ~~an increase of 17% and~~ a ~~decrease of 3~~28% percent ~~compared~~increase toover the ~~respective~~first ~~periods~~quarter inof ~~2023~~2024.

● Revenue from services was $1416,~~283~~688,000 ~~and $41,156,000~~ in the ~~three~~first ~~and~~quarter ~~nine~~of ~~month~~2025 ~~periods~~compared ~~ended~~to ~~September 30~~$13, ~~2024~~076,000 ~~respectively,~~in ~~which~~the ~~represents~~first anquarter ~~increase~~ of ~~7% percent and a decrease of 2% percent compared to the respective periods in 2023~~2024. Revenue for the ~~third~~first quarter of ~~2024~~2025 was higher compared to the ~~third~~first quarter of ~~2023~~2024 due to an increase in the number and value of professional services contracts completed during the ~~third~~first quarter of ~~2024~~2025, ~~and~~primarily ~~increased~~related ~~revenue~~to ~~from~~higher ~~transaction~~professional ~~processing~~ services ~~and~~revenue ~~software~~from ~~maintenance~~our ~~and~~largest ~~support~~customer, ~~services~~Goldman inSachs ~~the~~Group, ~~third~~Inc. ~~quarter~~We ofalso ~~2024~~experienced asincreased ~~compared~~revenue ~~to the third quarter of 2023 due to an increase in the number of customers and accounts on file. Revenue~~ from transaction processing services, and software maintenance and support services ~~were greater~~ in the first ~~nine~~quarter ~~months~~ of ~~2024~~2025 as compared to the first ~~nine~~quarter ~~months~~ of ~~2023,~~2024 due to an increase in the number of customers and accounts on file, ~~and~~partially offset by the acceleration of approximately $500,000 of processing revenue from a customer that was acquired in 2023 and, as a result, formally terminated their contract in the first quarter of 2024. This increase was offset by a decrease in the number and value of professional services contracts completed during the first nine months of 2024, primarily related to lower professional services revenue from our largest customer, Goldman Sachs Group, Inc. We expect that processing services will continue to grow as our customer base increases; however, the time required to implement new customer programs could be delayed due to third party integration and approval processes and other factors. It is difficult to predict with accuracy the number and value of professional services contracts that our customers will require in a given period. Customers typically request our professional services to modify or enhance their CoreCard software implementation based on their specific business strategy and operational requirements, which vary from customer to customer and period to period.

●We ~~Revenue~~expect ~~from~~that ~~products,~~processing ~~which~~services iswill ~~primarily~~continue ~~software~~to ~~license~~grow ~~fees,~~as ~~was~~our $1customer base increases; however,~~420,000~~ inthe ~~both~~time required to implement new customer programs could be delayed due to third party integration and approval processes. It is difficult to predict with accuracy the ~~three~~number and ~~nine~~value ~~month~~of ~~periods~~professional ~~ended~~services ~~September~~contracts ~~30,~~that ~~2024,~~our ~~compared~~customers will require in a given period. Customers typically request our professional services to $0modify or enhance their CoreCard software implementation based on their specific business strategy and $1operational requirements,~~794,000~~ inwhich ~~the~~vary ~~respective~~from ~~comparable~~customer ~~periods~~to ofcustomer ~~2023~~and period to period.

~~Cost~~● of Revenue –from ~~Total~~products, ~~cost~~which ofis ~~revenue~~primarily ~~was~~software 57license ~~percent~~fees, ~~and~~was 65$0 ~~percent of total revenue~~ in both the three ~~and nine~~ -month periods ended ~~September~~March 3031, ~~2024,~~2025 ~~respectively, compared to 69 percent~~ and ~~65 percent of total revenue in the corresponding periods of 2023. For the three-month period ended September 30,~~ 2024, ~~the decrease in cost of revenue~~ as ano ~~percentage~~new ~~of revenue is primarily driven by higher~~ license ~~revenue.~~tiers ~~Cost~~were ofachieved ~~revenue~~in ~~includes~~either costs to provide annual maintenance and support services to our installed base of licensed customers, costs to provide professional services, and costs to provide our financial transaction processing services. The cost and gross margins on such revenues can vary considerably from period ~~to period depending on the customer mix, customer requirements and project complexity as well as the mix of our U~~.S. and offshore employees working on the various aspects of services provided. In addition, we continue to devote the resources necessary to support our growing processing business, including direct costs for regulatory compliance, infrastructure, network certifications, and customer support. Investments in our infrastructure are in anticipation of adding customers in future periods. As such, we will not experience economies of scale unless we add additional customers, as anticipated. This may be subject to change in the future if new regulations or processing standards are implemented causing us to incur additional costs to comply.

~~Operating~~Cost ~~Expenses~~of Revenue – InTotal ~~the~~cost ~~three~~of ~~month~~revenue was 55 percent and ~~nine~~73 percent of total revenue in the three-month ~~period~~periods ended ~~September~~March 3031, 2025 and 2024, ~~total~~respectively. ~~operating~~The ~~expenses~~decrease ~~from~~in ~~consolidated~~cost ~~operations~~of ~~were~~revenue ~~higher~~as a percentage of revenue is primarily driven by 6%higher ~~and~~rates ~~were~~for ~~flat~~professional ~~compared~~services, toprimarily from the ~~corresponding~~increased ~~period~~managed inservices ~~2023~~revenue from Goldman, ~~respectively~~partially offset by higher low-margin third-party revenues. InTotal ~~the~~cost ~~three~~of ~~month~~revenue ~~period~~was $9,380,000 and $9,500,000 in the periods ended ~~September~~March 3031, 2025 and 2024, ~~total~~respectively. ~~operating~~Cost ~~expenses~~of ~~from~~revenue ~~consolidated~~includes ~~operations~~costs ~~were~~to ~~higher~~provide ~~than~~annual inmaintenance ~~the~~and ~~corresponding~~support ~~period~~services into ~~2023~~our ~~primarily~~installed ~~due~~base of licensed customers, costs to ~~higher~~provide ~~general~~professional services, and ~~administrative~~costs ~~expenses~~to provide our financial transaction processing services. ~~General~~The cost and ~~administrative~~gross ~~expenses~~margins ~~were~~on 16such ~~percent~~revenues ~~higher~~can invary ~~the~~considerably ~~three-month~~from period ~~ended~~to ~~September~~period 30depending on the customer mix, ~~2024~~customer ~~primarily~~requirements ~~due~~and toproject ~~higher~~complexity ~~bonus~~as ~~accruals.~~well ~~Marketing~~as ~~expenses~~the ~~increased~~mix 25of ~~percent~~our U.S. and 30offshore ~~percent~~employees ~~for~~working on the ~~three~~various ~~and~~aspects ~~nine~~of ~~month~~services ~~periods~~provided. inIn ~~2024~~addition, ~~respectively.~~we ~~Our~~continue ~~client~~to ~~base~~devote ~~continues~~the resources necessary to ~~increase~~support ~~with~~our ~~minimal~~growing ~~marketing~~processing ~~efforts~~business, asincluding wedirect ~~continue~~costs tofor ~~have~~regulatory ~~prospects~~compliance, ~~contact~~infrastructure, usnetwork ~~via~~certifications, ~~online~~and ~~searches;~~customer ~~however~~support. Investments in our infrastructure are in anticipation of adding customers in future periods. As such, we will ~~continue~~not toexperience ~~re-evaluate~~economies ~~our~~of ~~marketing~~scale ~~expenditures~~unless we add additional customers, as ~~needed~~anticipated. This may be subject to ~~competitively~~change ~~position~~in the ~~Processing~~future ~~Services~~if ~~business~~new regulations or processing standards are implemented causing us to incur additional costs to comply.

Investment Income (Loss) – In the three and nine months ended September 30, 2024, we recorded $90,000 and $528,000 of investment loss, respectively, compared to investment losses of $1,015,000 and $1,701,000 for the three and nine months ended September 30, 2023, respectively. The investment losses in 2024 relate to losses on our equity method investment. The investment losses in 2023 relate to a third quarter impairment charge on a cost method investment and losses on our equity method investment in a privately held identity and professional services company with ties to the FinTech industry (see Note 4). The privately held company has incurred losses as they invest in future growth.

Other Income (Loss) – In the three and nine months ended September 30, 2024, we recorded income of $233,000 and $758,000, respectively, compared to income of $308,000 and $653,000 for the comparable 2023 periods.

~~Income~~Operating ~~Taxes~~Expenses – ~~Our~~In ~~effective~~the ~~tax~~three-month ~~rates~~period ~~for~~ended ~~the~~March ~~three~~31, ~~and~~2025, ~~nine~~total ~~months~~operating ~~ended~~expenses ~~September~~from ~~30,~~consolidated ~~2024~~operations were ~~25.0~~higher ~~percent~~than in the corresponding period in 2024 primarily due to increased development and 24general and administrative expenses.9 ~~percent~~Development ~~compared~~expenses were higher in 2025 than in 2024 primarily due to ~~effective~~higher ~~tax~~bonus ~~rates~~accruals ofand 24higher stock compensation expense in the current period.5 ~~percent~~General and ~~24.8~~administrative ~~percent~~expenses ~~for~~were higher in 2025 than in 2024, primarily due to higher bonus accruals in the ~~respective~~current ~~periods~~period. Marketing expenses increased 19% in ~~2023~~2025 as compared to 2024. Our client base continues to increase with minimal marketing efforts as we continue to have prospects contact us via online searches; however, we will continue to re-evaluate our marketing expenditures as needed to competitively position the Processing Services business.

Investment Loss – In the quarter ended March 31, 2025, we recorded $435,000 of investment losses compared to investment losses of $204,000 for the quarter ended March 31, 2024. The increased loss is due to higher losses on equity method investments. Our investments are discussed further in Note 4.

Other Income, net – In the quarter ended March 31, 2025, we recorded $137,000 in other income compared to $256,000 for the quarter ended March 31, 2024. The decrease results from lower interest income due to lower cash balances in the 2025 period as compared to the 2024 period.

Income Taxes – Our effective tax rate for the quarter ended March 31, 2025, was 24.0% compared to an effective tax rate of 25.7% for the quarter ended March 31, 2024.

Liquidity and Capital Resources

Our cash and cash ~~equivalent~~equivalents balance at ~~September~~March 3031, ~~2024~~2025 was $22,~~498~~068,000 compared to $2619,~~918~~481,000 at December 31, ~~2023~~2024. During the ~~nine~~quarter ~~months~~ ended ~~September~~March 3031, ~~2024~~2025, cash provided by operations was $54,~~039~~600,000 compared to cash provided by operations of $18552,~~252,~~000 for the ~~nine~~quarter ~~months~~ ended ~~September~~March 3031, ~~2023~~2024. The ~~decrease~~increase in cash provided by operations is primarily due to lower accounts receivable and ~~deferred revenue balances, lower depreciation and amortization and a non-cash impairment charge in the 2023 period that did not recur in 2024, partially offset by~~ higher net income ~~and higher stock compensation expense~~.

During the ~~nine~~quarter ~~months~~ ended ~~September~~March 3031, ~~2024~~2025, we invested $1543,~~831,~~000 in publicly traded multi sector corporate and municipal debt ~~and treasury~~ securities, offset by related maturities of $1503,~~728,~~000, which is described in more detail in Note 8 to the Consolidated Financial Statements.

During the ~~nine~~quarter ~~months~~ ended ~~September~~March 3031, ~~2024~~2025, we used $31,~~733~~925,000 of cash, compared to $41,~~845~~593,000 of cash during ~~the~~quarter ~~nine months~~ ended ~~September~~March 3031, ~~2023~~2024, to acquire computer equipment and related software and for personnel and contractor development costs for the development of a new processing platform, and to enhance our existing processing environment in the U.S.~~, and a new data center in India for international operations.~~

We expect to have sufficient liquidity from cash on hand as well as projected customer payments to support our operations and capital equipment purchases in the foreseeable future. Currently we expect to use cash in excess of what is required for our current operations for opportunities we believe will expand our FinTech business, as exemplified byin transactions described in Note 3 and 4 to the Consolidated Financial Statements, although there can be no assurance that appropriate opportunities will arise. In May 2022, the Board authorized an additional $20 million for our share repurchase program. We made no share repurchases ~~of $5.4 million~~ for the ~~nine~~three months ended ~~September~~March 3031, ~~2024~~2025, and made share repurchases of $1.56 million for the ~~nine~~three months ended ~~September~~March 3031, ~~2023~~2024. We had approximately $97.31 million of authorized share repurchases remaining as of ~~September~~March 3031, ~~2024~~2025.

Off-Balance Sheet Arrangements

We do not currently have any off-balance sheet arrangements that are reasonably likely to have a current or future material effect on our financial condition, liquidity or results of operations.

Critical Accounting Policies and Estimates

The discussion and analysis of our financial condition and results of operations is based upon our Consolidated Financial Statements which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amount of assets, liabilities, revenues and expenses. We consider certain accounting policies related to revenue recognition and valuation of investments to be critical policies due to the estimation processes involved in each. Management discusses its estimates and judgments with the Audit Committee of the Board of Directors. For a detailed description on the application of these and other accounting policies, see Note 1 to the Consolidated Financial Statements contained in our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2023~~2024 (the “~~2023~~2024 Form 10-K”). Reference is also made to the discussion of the application of these critical accounting policies and estimates contained in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our ~~2023~~2024 Form 10-K. During the ~~nine~~three-month period ended ~~September~~March 3031, ~~2024~~2025, there were no significant or material changes in the application of critical accounting policies.

Factors That May Affect Future Operations

Future operations are subject to risks and uncertainties that may negatively impact our future results of operations or projected cash requirements. It is difficult to predict future quarterly and annual results with certainty.

Among the numerous factors that may affect our consolidated results of operations or financial condition are the following:

● Goldman Sachs Group, Inc., our largest customer, represented 6265% of our consolidated revenues for the ~~nine~~three months ended ~~September~~March 3031, ~~2024~~2025. In the event of material failures to meet contract obligations related to the services provided, there is a risk of breach of contract and loss of the customer and related future revenues. Additionally, loss of the customer and related future revenues or a reduction in revenues could result if they or their customers choose an alternative service provider, build an in-house solution, or decide to exit the business or service line that falls under the services that we provide for them. Goldman Sachs Group, Inc. recently announced the transition of its General Motors co-branded credit card to a new issuer, with an expected close in 2025, which could make it more likely that they exit the credit card business. The General Motors program was added to their portfolio in the first quarter of 2022.

●	Weakness or instability in the global financial markets could have a negative impact due to potential customers (most of whom perform some type of financial services) delaying decisions to purchase software or initiate processing services.

●	Increased federal and state regulations and reluctance by financial institutions to act as sponsor banks for prospective customers could result in losses and additional cash requirements.

●	Delays in software development projects could cause our customers to postpone implementations or delay payments, which would increase our costs and reduce our revenue and cash.

●	We could fail to deliver software products which meet the business and technology requirements of our target markets within a reasonable time frame and at a price point that supports a profitable, sustainable business model.

●

Our processing business is impacted, directly or indirectly, by more regulations than our licensed software business. If we fail to provide services that comply with (or allow our customers to comply with) applicable regulations or processing standards, we could be subject to financial or other penalties that could negatively impact our business.

●	A security breach in our platform could expose confidential information of our customers’ account holders, hackers could seize our digital infrastructure and hold it for ransom or other cyber risk events could occur and create material losses in excess of our insurance coverage.

●	Software errors or poor-quality control may delay product releases, increase our costs, result in non-acceptance of our software by customers or delay revenue recognition.

●	We could fail to expand our base of customers as quickly as anticipated, resulting in lower revenue and profits and increased cash needs.

●

We could fail to retain key software developers and managers who have accumulated years of know-how in our target markets and company products or fail to attract and train a sufficient number of new software developers and testers to support our product development plans and customer requirements at projected cost levels.

●

Increasing and changing government regulations in the United States and foreign countries related to such issues as data privacy, financial and credit transactions could require changes to our products and services which could increase our costs and could affect our existing customer relationships or prevent us from getting new customers.

●	Delays in anticipated customer payments for any reason would increase our cash requirements and could adversely impact our profits.

●	Competitive pressures (including pricing, changes in customer requirements and preferences, and competitor product offerings) may cause prospective customers to choose an alternative product solution, resulting in lower revenue and profits (or losses).

●	Our future capital needs are uncertain and depend on a number of factors; additional capital may not be available on acceptable terms, if at all.

●

Volatility in the markets, including as a result of political instability, civil unrest, war or terrorism, or pandemics or other natural disasters, such as the recent outbreak of coronavirus, could adversely affect future results of operations and could negatively impact the valuation of our investments.

● Other general economic and political conditions, including heightened or uncertain tariffs, changes in trade policies and the results thereof, could cause customers to reduce spending, or delay or cancel payments or purchases.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Not required for smaller reporting companies.

Item 4. Controls and Procedures

As of the end of the period covered by this report, the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures pursuant to Rule 13a-15(b) under the Exchange Act. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective. There were no significant changes in the ~~Company~~company’s internal control over financial reporting or in other factors identified in connection with this evaluation that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the ~~Company~~company’s internal control over financial reporting.

Part II. OTHER INFORMATION

Item 1. Legal Proceedings

From time to time, we may be involved in certain claims and litigation arising out of the ordinary course and conduct of business. Management assesses such claims and, if it considers that it is probable that an asset had been impaired or a liability had been incurred and the amount of loss can be reasonably estimated, provisions for loss are made based on management’s assessment of the most likely outcome. We are not currently a party to or aware of any proceedings that we believe will have, individually or in the aggregate, a material adverse effect on our business, financial condition, or results of operations.

Item 1A. Risk Factors

As a smaller reporting company, we are not required to make disclosures under this Item.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Repurchases of Securities

In May 2022, the Board authorized an additional $20 million for our share repurchase program. Under this program, which was publicly announced in November 2018, we are authorized to repurchase shares through open market purchases, privately-negotiated transactions or otherwise in accordance with applicable federal securities laws, including through Rule 10b5-1 trading plans and under Rule 10b-18 of the Exchange Act. The repurchase program does not have an expiration date and may be suspended or discontinued at any time. We ~~had~~have approximately $97.31 million of authorized share repurchases remaining at ~~September~~March 3031, ~~2024~~2025.

The following table sets forth information regarding our purchases of shares of our common stock during the three months ended September 30, 2024:

	Total Number of Shares Purchased		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Program		Maximum Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program
July 1, 2024 to July 31, 2024		−	$	−		−	$	10,977,000
August 1, 2024 to August 31, 2024		79,422		13.27		79,422		9,923,000
September 1, 2024 to September 30, 2024		43,948		14.95		43,948		9,266,000
Total		123,370				123,370

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

~~During the fiscal quarter ended September 30, 2024, no director or officer of the Company adopted or terminated a “~~Rule 10b5-1 ~~trading arrangement” or “Non-Rule 10b5-1 trading arrangement” as each term is defined in Item 408 of Regulation S-K.~~Plans

During the fiscal quarter ended March 31, 2025, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “Non-Rule 10b5-1 trading arrangement” as each term is defined in Item 408 of Regulation S-K.

Retention Liability Program

On May 7, 2025, our Board of Directors approved a retention program for employees who, as of July 31, 2024, have been employees of the Company for more than five years, which includes our President and Chief Executive Officer, and our Chief Financial Officer and Corporate Secretary. Under the program, we agreed to make a cash retention payment to each covered employee equal to the amount, if any, by which the employee’s 2024 base salary exceeds the value, measured as of close of trading on December 31, 2028, of the shares of restricted stock granted to such employee in 2024 and 2025 that are vested as of December 31, 2028. Employees must remain actively and continuously employed, in good standing, through December 31, 2028, and the program may be cancelled in connection with an acquisition of the Company by a buyer with a market capitalization in excess of $1 billion if the restricted stock granted to the covered employees in 2024 and 2025 vests within 30 days after closing. We expect to evaluate the liability and corresponding service cost associated with the program on a quarterly basis. The program is not evidenced by a formal written plan document or formal written agreements with the covered employees.

Item 6. Exhibits

The following exhibits are filed or furnished with this report:

10.1 Omnibus Amendment No. 2 to GS-CoreCard Agreements

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 and Chief Financial Officer furnished as required by Section 906 of the Sarbanes-Oxley Act of 2002.

31.1 Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

101.INS**	Inline XBRL Instance
101.SCH**	Inline XBRL Taxonomy Extension Schema
101.CAL**	Inline XBRL Taxonomy Extension Calculation
101.DEF**	Inline XBRL Taxonomy Extension Definitions
101.LAB**	Inline XBRL Taxonomy Extension Labels
101.PRE**	Inline XBRL Taxonomy Extension Presentation
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

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 and Chief Financial Officer furnished as required by Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS** XBRL Instance

101.SCH** XBRL Taxonomy Extension Schema

101.CAL** XBRL Taxonomy Extension Calculation

101.DEF** XBRL Taxonomy Extension Definitions

101.LAB** XBRL Taxonomy Extension Labels

101.PRE** XBRL Taxonomy Extension Presentation

104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

XBRL information is furnished and not filed or a part of a registration statement or prospectus for purposes of sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

†

Certain portions of this exhibit have been omitted pursuant to Item 601 of Regulation S-K(b)(10)(iv).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

	CORECARD CORPORATION Registrant
	CORECARD CORPORATION
Date: October 31, 2024	By:	/s/ J. Leland Strange
	Registrant
Date: May 8, 2025	By:	/S/ J. Leland Strange
		J. Leland Strange
		Chief Executive Officer, President
Date: October 31, 2024	By:	/s/ Matthew A. White
Date: May 8, 2025	By:	/S/ Matthew A. White
		Matthew A. White
		Matthew A. White Chief Financial Officer
		Chief Financial Officer

EXHIBIT INDEX

Exhibit No.		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 and Chief Financial Officer furnished as required by Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS**		Inline XBRL Instance

101.SCH**		Inline XBRL Taxonomy Extension Schema

101.CAL**		Inline XBRL Taxonomy Extension Calculations

101.DEF**		Inline XBRL Taxonomy Extension Definitions

101.LAB**		Inline XBRL Taxonomy Extension Labels

101.PRE**		Inline XBRL Taxonomy Extension Presentation

104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

†	Certain portions of this exhibit have been omitted pursuant to Item 601 of Regulation S-K(b)(10)(iv).

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