SESI Holdings, Inc. Q4 FY2025 earnings call

Pivot from promotions company to technology company that does promotions. Launched refreshed brand 'Marketing verified from ad to aisle'. Built AI-powered infrastructure including receipt validation, fraud detection, etc. Secured multi-year contracts like $3.3 million with pet care client, $1.4 million with another pet care brand, etc. Implemented ~$1.3 million annualized run rate operating expense reductions. Partnered with Inmar Intelligence integrating digital grocery incentives into Bank of America network.

Revenue for fiscal 2025 was $22 million, a slight decline of roughly 3% from $22.7 million in 2024. Gross margin was 61% for the full year, identical to 2024, and 65% in the fourth quarter. Bookings backlog was $18.26 million at year-end, up from $17.7 million the prior year. Cash closed at $3.4 million, and the company secured a $4.5 million Canadian senior secured convertible debenture financing.

2026 focus on narrowing EBITDA losses, stacking recurring revenue from renewals/extensions, sharpening investor disclosures, continuing AI investment. Post-financing, focus on reducing operating cost base, converting backlog to recognized revenue, improving visibility into recurring/high-margin components.

Macroeconomic impacts causing large clients to delay or scale back campaigns. Industry in transition with uncertainties. Privacy regulation and market changes affecting business dynamics.

Q: Last quarter noted clients sitting on campaigns, how's environment?

A: Not much changed, but seen big deals signed, adapted operating philosophy.

Q: Progress on SNF media with Bank of America?

A: Launched but Bank of America re-platforming, to relaunch when migration complete.

Q: Impact of shopping trend?

A: Promotions need remains, AI helps operations, building towards future with chat GPT-like interactions.

Q: What led to big contract win?

A: Power of receipt processing platform generating first-party data for clients