CompoSecure (CMPO), the payment card maker, witnessed a sharp 8.49% plummet in its stock price during the pre-market trading session on Thursday. The sell-off came in response to the company's weaker-than-expected fourth-quarter earnings results and rising costs that weighed on its profitability.
For the quarter ended December 31, 2024, CMPO reported net sales of $100.9 million, a meager 1% year-over-year growth, missing analysts' consensus estimate of $102.2 million. The company cited higher costs and expenses related to new card designs, production inefficiencies, and inflationary pressures as key factors impacting its financial performance.
Adjusted earnings per share (EPS) came in at $0.20, lower than analysts' expectations of $0.22 and down from $0.24 in the prior-year period. Gross margins compressed to 52.1% from 52.9% a year ago, while selling, general and administrative expenses surged 65% to $36.9 million, further weighing on the company's bottom line.
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