COLUMBIA, Md., March 31, 2026 (GLOBE NEWSWIRE) -- Rekor Systems, Inc. $(REKR)$, ("Rekor" or the "Company"), a leader in developing and implementing cutting-edge roadway intelligence systems, today reported financial and operational results for the full year ended December 31, 2025, highlighting a year of disciplined execution, operational efficiency, and strategic repositioning.
"2025 was a transformative year for Rekor," said Joseph Nalepa, Rekor's Chief Financial Officer. "The maturity of our development efforts has enabled us to make a deliberate shift to operate as a pragmatic, product-focused business. That discipline has resulted in a stronger, leaner company with a clear path to sustainable profitability."
Financial Highlights
-- Revenue increased approximately 5% year-over-year, reflecting steady
top-line growth despite a strong prior-year comparison.
-- Gross margins expanded to 56%, up from 49% in 2024, driven by a focus on
higher-value, recurring revenue streams.
-- Adjusted EBITDA loss reduced by approximately 38%, reflecting successful
cost alignment and operational efficiencies.
-- Achieved positive operating cash flow in Q4 2025, marking the Company's
first quarter of cash inflow from operations.
Operational Highlights
Reduced non-recurring engineering spending and aligned cost structure with current revenue scale.
-- Drove further efficiency with the integration of our STS and ATD
subsidiaries, eliminating legacy complexity and unlocking operational
synergies.
-- On-shored Rekor Command$(R)$ engineering and product operations to the
United States, improving customer coordination, responsiveness, and
service delivery.This resulted in enhanced customer service and product
responsiveness, with transportation agencies reporting faster turnaround
times and improved engagement.
-- Secured a landmark patent for "Incident-Based" data retention, replacing
outdated ALPR and vehicle dragnets with privacy-sensitive intelligent
storage.
-- Announced plans to launch Rekor Labs, a new subsidiary pioneering a suite
of patented products to identify synthetically created and modified
media.
These initiatives have strengthened collaboration across product, engineering, and customer success teams while improving overall operational performance.
Strategic Highlights
Rekor also made significant progress in positioning the Company for scalable growth
-- Transitioned from a development-heavy theoretical model to a
product-first portfolio, with Rekor Scout(R), Rekor Discover(R), and
Rekor Command(R) fully commercialized
-- Shifted engineering focus from large-scale development to product
maintenance and targeted enhancements, enabling a planned significant
reduction in R&D spend
-- Increased Remaining Performance Obligations for Georgia Department of
Transportation-related work, adding multi-year contracted revenue
visibility
Year Ended December 31, 2025 Financial Results
This section highlights the changes for the year ended December 31, 2025, compared to the year ended December 31, 2024.
Revenues and Cost of Revenue, excluding Depreciation and Amortization
Year ended December 31, Change
------------------------------- --------------------
2025 2024 $ %
--- ------ ---- ------- ------------ ------
(Dollars in thousands, except percentages)
-----------------------------------------------------
Revenue $ 48,450 $ 46,028 $ 2,422 5%
Cost of
revenue,
excluding
depreciation
and
amortization 21,379 23,344 (1,965) 8%
--- ------ ---- ------- -------
Adjusted
Gross
Profit $ 27,071 $ 22,684 $ 4,387 19%
Adjusted
Gross
Margin 55.9% 49.3% 6.6% 13%
=== ====== === ======= =======
The increase in revenue for the year ended December 31, 2025, compared to the year ended December 31, 2024, was primarily attributable to our Public Safety product line.
During the year ended December 31, 2025, revenue attributable to our Public Safety product line was $17,401,000 compared to $14,807,000 for the year ended December 31, 2024. This increase was primarily due to higher perpetual license sales in 2025.
For the year ended December 31, 2025, cost of revenue, excluding depreciation and amortization decreased compared to prior year primarily due to a favorable revenue mix of software versus hardware, which resulted in higher margins from increased software license sales.
Adjusted Gross Margin is a non-GAAP financial measure calculated as Adjusted Gross Profit divided by revenue and should not be considered in isolation from, or as a substitute for, GAAP financial measures.
Loss from Operations
Year ended December 31, Change
----------------------------- ----------------
2025 2024 $ %
--------- -------- ------- -------
Loss from
operations $ (28,886) $ (54,323) $25,437 -47%
Loss from operations for the year ended December 31, 2025, compared to the year ended December 31, 2024, improved primarily due to our continued revenue growth while reducing payroll and payroll-related costs as a result of cost containment efforts intended to conform to current operations.
Additionally, approximately $6,460,000 of the improvement was related to a reduction in asset impairment costs in fiscal year 2025 compared to 2024.
EBITDA and Adjusted EBITDA
The Company calculates EBITDA as net loss before interest, taxes, depreciation, and amortization. The Company calculates Adjusted EBITDA as net loss before interest, taxes, depreciation, and amortization, adjusted for (i) impairment of intangible assets, (ii) loss on extinguishment of debt, (iii) stock-based compensation, (iv) losses or gains on sales of subsidiaries, and (v) other unusual or non-recurring items. EBITDA and Adjusted EBITDA are not measurements of financial performance or liquidity under accounting principles generally accepted in the U.S. ("U.S. GAAP") and should not be considered as an alternative to net earnings or cash flow from operating activities as indicators of our operating performance or as a measure of liquidity or any other measures of performance derived in accordance with U.S. GAAP. EBITDA and Adjusted EBITDA are presented because we believe they are frequently used by securities analysts, investors, and other interested parties to evaluate a company's ability to service and/or incur debt. However, other companies in our industry may calculate EBITDA and Adjusted EBITDA differently than we do. These non-GAAP measures should not be considered in isolation from, or as a substitute for, GAAP measures.
The following table sets forth the components of the EBITDA and Adjusted EBITDA for the periods included (dollars in thousands):
Year ended December 31,
-------------------------------
2025 2024
Net loss $ (31,460) $ (61,410)
--------- --------
Provision for income taxes 42 45
Interest expense, net 2,297 2,645
Depreciation and amortization 6,258 9,493
EBITDA $ (22,863) $ (49,227)
--------- --------
Share-based compensation 2,908 4,829
Loss on extinguishment of debt - 4,693
Asset impairment charges 3,754 10,214
Loss on offering costs - Prepaid Advance - 888
Loss on settlement of Prepaid Advance - 900
Gain on the sale of Global Public Safety - (1,500)
(Gain) loss due to the remeasurement of
the STS Earnout and Contingent
Consideration, net (1,900) 100
Adjusted EBITDA $ (18,101) $ (29,103)
========= ========
The Company will host its earnings conference call today at 4:30 p.m. ET to discuss its financial and operating results.
CONFERENCE CALL INFORMATION
Any person interested in participating in the call should please dial in approximately 10 minutes before the start of the call using the following information:
North America: Participant Dial-In: 877-407-8037 / +1 201-689-8037
Click here for participant International Toll-Free access numbers
Webcast: https://event.choruscall.com/mediaframe/webcast.html?webcastid=B6zEm1IS
REPLAY INFORMATION
A replay will be available online approximately two hours after the live call for two weeks. To access the replay, use the following numbers:
Replay Dial-In: 877-660-6853 / 201-612-7415
Access ID: 13759242
Replay Duration: two weeks.
About Rekor Systems, Inc.
Rekor Systems, Inc. (NASDAQ: REKR) is a leader in developing and implementing state-of-the-art roadway intelligence systems using AI-enabled computer vision and other advanced technologies. Our solutions provide actionable insights to government agencies and businesses in a secure, collaborative, privacy-protected environment that drives the world to be safer and more efficient. To learn more, please visit our website: https://rekor.ai, and follow Rekor on social media on LinkedIn, X (formerly Twitter), Threads, and Facebook.
Forward-Looking Statements
This press release and its links and attachments contains forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 concerning Rekor Systems, Inc. that involve substantial risks and uncertainties, including particularly statements regarding our future results of operations and financial position, business strategy, prospective products and services, timing and likelihood of success, plans and objectives of management for future operations and future results of current and anticipated products and services. These statements involve uncertainties, such as known and unknown risks, and are dependent on other important factors that may cause our actual results, performance, or achievements to be materially different from the future results, performance or achievements we express or imply. For this purpose, any statements that are not statements of historical fact may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by terms such as "may," "will," "should," "expect," "plan," "anticipate, " "could," "intend," "target," "project," "contemplates," "believes," "estimates," "predicts," "potential," or "continue," or the negative of these terms or other similar expressions. These forward-looking statements speak only as of the date they are made and are subject to a number of risks, uncertainties and assumptions described under the sections in our Annual Report on Form 10-K for the year ended December 31, 2025 entitled "Risk Factors" and in our subsequent Quarterly Reports on Form 10-Q filed with the SEC. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. Readers are urged to carefully review and consider the various disclosures made in this Press Release and in other documents we file from time to time with the SEC that disclose risks and uncertainties that may affect our business. The forward-looking statements in this Press Release do not reflect the potential impact of any divestiture, merger, acquisition, or other business combination that had not been completed as of the date of this filing. Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified and some of which are beyond our control, you should not rely on these forward-looking statements as predictions of future events. These forward-looking statements are qualified in their entirety by reference to the risks discussed in our SEC filings. This cautionary statement also applies to any forward-looking statements made during the conference call referenced herein. We do not undertake any obligation to publicly update any forward-looking statements, whether as a result of the receipt of new information, the occurrence of future events, or otherwise.
Company Contact:
Rekor Systems, Inc.
Joseph Nalepa
Chief Financial Officer
Phone: +1 (410) 762-0800
jnalepa@rekor.ai
Media & Investor Relations Contact:
Rekor Systems, Inc.
Charles Degliomini
ir@rekor.ai
REKOR SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except share and per share
amounts)
--------------------------------------------------------------------------
December 31, 2025 December 31, 2024
------------------- ---------------------
ASSETS
Current assets
Cash and cash
equivalents $ 16,566 $ 5,013
Restricted cash 297 316
Accounts receivable, net 8,770 7,232
Inventory 3,072 4,297
Note receivable, current
portion 198 340
Other current assets 1,825 2,732
Total current assets 30,728 19,930
-------------- --------------
Long-term assets
Property and equipment,
net 8,632 11,048
Right-of-use operating
lease assets, net 4,716 9,348
Right-of-use financing
lease assets, net 1,634 2,317
Goodwill 24,313 24,313
Intangible assets, net 13,250 14,450
Note receivable,
long-term - 142
Deposits 2,114 927
Total long-term assets 54,659 62,545
-------------- --------------
Total assets $ 85,387 $ 82,475
============== ==============
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities
Accounts payable and
accrued expenses 4,362 4,330
Notes payable, current
portion - 1,000
Series A Prime Revenue
Sharing Notes, net of
debt discount of $131
and $0, respectively 9,869 -
Series A Prime Revenue
Sharing Notes - related
party, net of debt
discount of $66 and $0,
respectively 4,934 -
Loans payable, current
portion 83 79
Lease liability
operating, short-term 2,720 2,310
Lease liability
financing, short-term 787 900
Contract liabilities 4,604 3,439
Liability for ATD
Holdback Shares - 1,036
Other current
liabilities 1,729 5,129
Total current liabilities 29,088 18,223
-------------- --------------
Long-term liabilities
Series A Prime Revenue
Sharing Notes, net of
debt discount of $0 and
$263, respectively - 9,737
Series A Prime Revenue
Sharing Notes - related
party, net of debt
discount of $0 and
$132, respectively - 4,868
Loans payable, long-term 112 194
Lease liability
operating, long-term 10,570 12,371
Lease liability
financing, long-term 665 977
Contract liabilities,
long-term 1,402 1,298
Deferred tax liability 93 79
Other long-term
liabilities 587 587
Total long-term liabilities 13,429 30,111
-------------- --------------
Total liabilities 42,517 48,334
-------------- --------------
Commitments and contingencies
Stockholders' equity
Preferred stock, $0.0001
par value, 2,000,000
authorized, 505,000
shares designated as
Series A and 240,861
shares designated as
Series B as of December
31, 2025 and December
31, 2024, respectively.
No preferred stock was
issued or outstanding as
of December 31, 2025 or
2024, respectively. - -
Common stock, $0.0001
par value; authorized;
300,000,000 shares;
issued: 136,791,826
shares at December 31,
2025 and 104,700,593 at
December 31, 2024;
outstanding:
136,477,697 shares at
December 31, 2025 and
104,541,073 at December
31, 2024 13 10
Treasury stock - at
cost, 314,129 and
159,520 shares as of
December 31, 2025 and
2024, respectively (900) (711)
Additional paid-in
capital 335,310 294,935
Accumulated deficit (291,553) (260,093)
Total stockholders'
equity 42,870 34,141
-------------- --------------
Total liabilities and
stockholders' equity $ 85,387 $ 82,475
============== ==============
REKOR SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands, except share and per share
amounts)
----------------------------------------------------------------------
Year ended December 31,
-----------------------------
2025 2024
Revenue $ 48,450 $ 46,028
Cost of revenue, excluding depreciation
and amortization 21,379 23,344
Operating expenses:
General and administrative expenses 25,177 30,676
Selling and marketing expenses 6,172 7,858
Research and development expenses 14,596 18,766
Asset impairment charges 3,754 10,214
Depreciation and amortization 6,258 9,493
Total operating expenses 55,957 77,007
----------- ----------
Loss from operations (28,886) (54,323)
Other income (expense):
Loss on extinguishment of debt - (4,693)
Interest expense, net (2,297) (2,645)
(Loss) gain on remeasurement of ATD
Holdback Shares (120) 599
Loss on offering costs - Prepaid
Advance - (888)
Loss on settlement of Prepaid
Advance - (900)
Gain on the sale of Global Public
Safety - 1,500
Other expense, net (115) (15)
----------- ----------
Total other expense, net (2,532) (7,042)
----------- ----------
Loss before income taxes (31,418) (61,365)
Provision for income taxes 42 45
Net loss $ (31,460) $ (61,410)
----------- ----------
Loss per common share - basic and
diluted $ (0.26) $ (0.71)
=========== ==========
Weighted average shares outstanding
Basic and diluted 119,667,774 86,717,724
=========== ==========
(END) Dow Jones Newswires
March 31, 2026 16:05 ET (20:05 GMT)
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