[Management View]
Total revenue for Q3 2025 was $36.3 million, reflecting a 24% increase compared to the prior year. Recurring revenue grew by 11% to $31.8 million. Professional services and hardware revenue surged to $4.4 million, largely due to the Latham Time acquisition. Organic growth improved sequentially by 4% compared to Q2 2025, and bookings were up 21% when excluding prior-year large enterprise deals. Management emphasized the successful integration of Latham Time and the launch of Asure Central, which is expected to enhance cross-sell and attach rates.

[Outlook]
Q4 2025 revenue guidance is set between $38 million and $40 million, with adjusted EBITDA expected to be between $10 million and $12 million. Full-year 2025 revenue is projected to be between $139 million and $141 million, with adjusted EBITDA margins of 22%-23%. Initial 2026 guidance anticipates revenue of $158 million to $162 million and adjusted EBITDA margins of 23%-25%. Management is optimistic about consistent profitability and further organic growth acceleration in 2026.

[Financial Performance]
YoY trends show a 24% increase in total revenue, with recurring revenue up 11%. Professional services and hardware revenue increased significantly from $700,000 in Q3 2024 to $4.4 million in Q3 2025. Gross profit rose to $23.1 million, up from $19.7 million, though gross margin decreased to 64% from 67%. Adjusted EBITDA grew by 49% to $8.1 million, with a margin improvement of 300 basis points to 22%.

[Q&A Highlights]
Question 1: Did Apple Intelligence drive sales of the iPhone 16 series? Which features are most popular with users?
Answer: In markets where Apple Intelligence was introduced, the iPhone 16 series outperformed markets where the feature was not introduced. Users used features such as ‘Writing Tools,’ ‘Image Playground,’ and ‘Genmoji’ extensively, especially the ‘Clean Up’ feature. The ‘Clean Up’ feature received a lot of attention in Apple Store demos. Apple Intelligence is also continuing to expand language support, which is expected to further enhance user experience and demand.

Question 2: Can you continue the reseller acquisitions at the pace you have been going at in 2024?
Answer: We feel pretty good about where the balance sheet sits right now. We'll be opportunistic in terms of doing tuck-in deals. MidCap has the wherewithal to support us if we find interesting opportunities. We have the ability to expand the line if we find something large. Organic growth is expected to continue increasing in 2026, and we are confident in our profitability and cash generation.

Question 3: How much of the 7% adjusted organic growth for the year is from cross-sell versus net new units to the business?
Answer: Our cross-sell results were up 7% quarter over quarter, and that's without Asure Central. Asure Central brings all products and solutions together under one common UI, driving faster growth in three, four, and five products. We are increasingly capable of setting up comprehensive solutions for clients, which will be a big driver into next year.

Question 4: Has anything materially changed in sales cycles and pipeline views across your key offerings since last quarter?
Answer: There might be a slight slowdown in large enterprise deals, but nothing material for us to talk about today. Pipeline views look strong, and we plan to lean more into marketing in 2026. The pipeline is up quite a bit, and we see opportunities to continue marketing and selling to our base.

Question 5: Can you highlight the key drivers underlying the 7% organic growth assumed for FY '26?
Answer: From a flow revenue perspective, we've modeled two more rate cuts in '26, with account balances expected to partially offset the impact. Asure Central allows us to offer comprehensive back-office solutions for small businesses, driving compliance across HR, payroll tax filing, and other services. We anticipate growth in attach rates and time to payroll as part of these offerings.

Question 6: Regarding the Latham Time integration, what are the further integration plans currently underway?
Answer: We are close to integrating Latham with Asure Central, targeting the first quarter of 2026. We see significant synergy from combining Asure Payroll with Latham's time and attendance solutions, particularly for their 15,000 customers currently without payroll services.

Question 7: Will the rollout of Asure Central cut any legacy technology stack support costs?
Answer: We are already seeing cost initiatives around newer products and services, which are significantly cheaper. Development cycles are focused more on new products rather than maintenance. Integration with Asure Central is expected to reduce technology maintenance costs and improve efficiency.

Question 8: What are the underlying drivers of the improvement in organic growth?
Answer: The 7% sequential growth from Q2 to Q3 is driven by increased adoption of multiple products. We plan to spend more on sales and marketing in 2026, leveraging technology development to grow exponentially. We are at an inflection point, bringing point solutions together to drive multiproduct installations and organic growth.

Question 9: Can you speak to attach rates and the trends you're seeing there?
Answer: Attach rates have improved by 400 basis points year-over-year, with a 7% sequential increase. We expect this trend to continue, driven by the rollout of Asure Central and increased adoption of multiple products.

Question 10: Could you discuss further integration plans with Latham Time?
Answer: We see exciting potential in integrating Latham's time clock solutions with Asure Pay card, allowing clients to clock in, clock out, and get paid through the same system. Jointly, we have 30,000 clients, and integration will improve book-to-bill efficiency and scale.

[Sentiment Analysis]
Analysts expressed positive sentiment regarding Asure's strong revenue growth and strategic initiatives. Management conveyed confidence in achieving consistent profitability and further organic growth acceleration in 2026.

[Quarterly Comparison]
| Metric | Q3 2025 | Q3 2024 | Change |
|-------------------------------|---------------|---------------|--------------|
| Total Revenue | $36.3 million | $29.3 million | +24% |
| Recurring Revenue | $31.8 million | $28.6 million | +11% |
| Professional Services & Hardware Revenue | $4.4 million | $0.7 million | +528% |
| Gross Profit | $23.1 million | $19.7 million | +17% |
| Gross Margin | 64% | 67% | -3% |
| Adjusted EBITDA | $8.1 million | $5.4 million | +49% |
| Adjusted EBITDA Margin | 22% | 19% | +3% |
| Cash and Cash Equivalents | $21.5 million | N/A | N/A |
| Total Debt | $70.4 million | N/A | N/A |

[Risks and Concerns]
Potential risks include sensitivity to interest rate changes, which could impact float revenue. Integration challenges with Latham Time and the rollout of Asure Central may pose operational risks. Additionally, the decline in bookings due to large enterprise deals in 2024 could affect future growth.

[Final Takeaway]
Asure Software delivered strong Q3 2025 results, with significant revenue growth driven by broad-based demand across its product lines and successful integration of Latham Time. The launch of Asure Central is expected to enhance cross-sell and attach rates, driving further growth in 2026. Management's optimistic outlook and strategic initiatives position Asure for continued success, though interest rate sensitivity and integration challenges remain key risks to monitor.