| Segment Reporting |
14. Segment Reporting The Company’s chief operating decision maker is its CEO, who is charged with the management of the Company and is responsible for the evaluation of operating performance and decision-making about the allocation of resources to operating segments based on the measures of net sales and EBITDA. As the Company uses the term, “EBITDA” is defined as income before interest expense, income taxes, depreciation and amortization. The Company’s chief operating decision maker believes EBITDA is a meaningful measure and is useful as a supplement to GAAP measures as it represents a transparent view of the Company’s operating performance that is unaffected by fluctuations in property, equipment and leasehold improvement additions. The Company’s chief operating decision maker uses EBITDA to perform periodic reviews and comparison of operating trends and to identify strategies to improve the allocation of resources amongst segments. As of September 30, 2025, the Company’s reportable segments were as follows: Debit and Credit Segment The Debit and Credit segment primarily produces secure debit and credit cards and provides card services, including digital services, for U.S. card-issuing financial institutions. Products produced by this segment primarily include payment cards, including contact, contactless, eco-focused, and magnetic stripe cards. This segment also provides personalization services; instant issuance solutions, which provide customers the ability to issue an instant personalized debit or credit card on-demand within a customer location; and other payment solutions such as digital push provisioning for mobile wallets. Prepaid Debit Segment The Prepaid Debit segment primarily provides integrated prepaid card services to prepaid program managers primarily in the U.S., including payment cards issued on the networks of the Payment Card Brands and related tamper-evident secure packaging. Other The Other segment includes corporate expenses. Performance Measures of Reportable Segments Net sales and EBITDA of the Company’s reportable segments, as well as a reconciliation of total segment EBITDA to income from operations and net income for the three and nine months ended September 30, 2025 and 2024, were as follows: | | | | | | | | | | | | | | | | Three Months Ended September 30, 2025 | | Debit and Credit | | Prepaid Debit | | Other | | Intersegment Eliminations | | Total | Net sales | | | | | | | | | | | | | | | Products | $ | 85,072 | | $ | — | | $ | — | | $ | (619) | | $ | 84,453 | Services | | 30,200 | | | 23,335 | | | — | | | (22) | | | 53,513 | Total net sales | | 115,272 | | | 23,335 | | | — | | | (641) | | | 137,966 | Cost of sales | | | | | | | | | | | | | | | Products (1) | | 59,780 | | | — | | | — | | | (619) | | | 59,161 | Services (1) | | 18,012 | | | 15,211 | | | — | | | (22) | | | 33,201 | Depreciation and amortization | | 3,536 | | | 1,075 | | | — | | | — | | | 4,611 | Total cost of sales | | 81,328 | | | 16,286 | | | — | | | (641) | | | 96,973 | Gross profit | | 33,944 | | | 7,049 | | | — | | | — | | | 40,993 | Operating expenses | | 12,667 | | | 1,166 | | | 14,142 | | | — | | | 27,975 | Income (loss) from operations | $ | 21,277 | | $ | 5,883 | | $ | (14,142) | | $ | — | | $ | 13,018 | | | | | | | | | | | | | | | | EBITDA by segment: | | | | | | | | | | | | | | | Income (loss) from operations | $ | 21,277 | | $ | 5,883 | | $ | (14,142) | | $ | — | | $ | 13,018 | Depreciation and amortization | | 4,113 | | | 1,134 | | | 868 | | | — | | | 6,115 | Other expense | | (238) | | | (1) | | | (290) | | | — | | | (529) | EBITDA | $ | 25,152 | | $ | 7,016 | | $ | (13,564) | | $ | — | | $ | 18,604 | | | | | | | | | | | | | | | | Gross profit margin | | 29.4% | | | 30.2% | | | * | | | * | | | 29.7% | EBITDA margin | | 21.8% | | | 30.1% | | | * | | | * | | | 13.5% |
| | | | | | | | | | | | | | | | Nine Months Ended September 30, 2025 | | Debit and Credit | | Prepaid Debit | | Other | | Intersegment Eliminations | | Total | Net sales | | | | | | | | | | | | | | | Products | $ | 235,873 | | $ | — | | $ | — | | $ | (1,295) | | $ | 234,578 | Services | | 86,676 | | | 69,270 | | | — | | | (44) | | | 155,902 | Total net sales | | 322,549 | | | 69,270 | | | — | | | (1,339) | | | 390,480 | Cost of sales | | | | | | | | | | | | | | | Products (1) | | 161,719 | | | — | | | — | | | (1,295) | | | 160,424 | Services (1) | | 52,305 | | | 44,116 | | | — | | | (44) | | | 96,377 | Depreciation and amortization | | 8,678 | | | 3,192 | | | — | | | — | | | 11,870 | Total cost of sales | | 222,702 | | | 47,308 | | | — | | | (1,339) | | | 268,671 | Gross profit | | 99,847 | | | 21,962 | | | — | | | — | | | 121,809 | Operating expenses | | 33,814 | | | 3,909 | | | 47,541 | | | — | | | 85,264 | Income (loss) from operations | $ | 66,033 | | $ | 18,053 | | $ | (47,541) | | $ | — | | $ | 36,545 | | | | | | | | | | | | | | | | EBITDA by segment: | | | | | | | | | | | | | | | Income (loss) from operations | $ | 66,033 | | $ | 18,053 | | $ | (47,541) | | $ | — | | $ | 36,545 | Depreciation and amortization | | 9,912 | | | 3,376 | | | 2,589 | | | — | | | 15,877 | Other (expense) income | | (278) | | | 5 | | | (251) | | | — | | | (524) | EBITDA | $ | 75,667 | | $ | 21,434 | | $ | (45,203) | | $ | — | | $ | 51,898 | | | | | | | | | | | | | | | | Gross profit margin | | 31.0% | | | 31.7% | | | * | | | * | | | 31.2% | EBITDA margin | | 23.5% | | | 30.9% | | | * | | | * | | | 13.3% |
| | | | | | | | | | | | | | | | Three Months Ended September 30, 2024 | | Debit and Credit | | Prepaid Debit | | Other | | Intersegment Eliminations | | Total | Net sales | | | | | | | | | | | | | | | Products | $ | 69,803 | | $ | — | | $ | — | | $ | (155) | | $ | 69,648 | Services | | 29,952 | | | 25,173 | | | — | | | (22) | | | 55,103 | Total net sales | | 99,755 | | | 25,173 | | | — | | | (177) | | | 124,751 | Cost of sales | | | | | | | | | | | | | | | Products (1) | | 44,354 | | | — | | | — | | | (155) | | | 44,199 | Services (1) | | 17,342 | | | 15,607 | | | — | | | (22) | | | 32,927 | Depreciation and amortization | | 1,928 | | | 999 | | | — | | | — | | | 2,927 | Total cost of sales | | 63,624 | | | 16,606 | | | — | | | (177) | | | 80,053 | Gross profit | | 36,131 | | | 8,567 | | | — | | | — | | | 44,698 | Operating expenses | | 9,096 | | | 1,456 | | | 16,348 | | | — | | | 26,900 | Income (loss) from operations | $ | 27,035 | | $ | 7,111 | | $ | (16,348) | | $ | — | | $ | 17,798 | | | | | | | | | | | | | | | | EBITDA by segment: | | | | | | | | | | | | | | | Income (loss) from operations | $ | 27,035 | | $ | 7,111 | | $ | (16,348) | | $ | — | | $ | 17,798 | Depreciation and amortization | | 2,198 | | | 1,061 | | | 894 | | | — | | | 4,153 | Other income (expense) | | 31 | | | (1) | | | (3,551) | | | — | | | (3,521) | EBITDA | $ | 29,264 | | $ | 8,171 | | $ | (19,005) | | $ | — | | $ | 18,430 | | | | | | | | | | | | | | | | Gross profit margin | | 36.2% | | | 34.0% | | | * | | | * | | | 35.8% | EBITDA margin | | 29.3% | | | 32.5% | | | * | | | * | | | 14.8% |
| | | | | | | | | | | | | | | | Nine Months Ended September 30, 2024 | | Debit and Credit | | Prepaid Debit | | Other | | Intersegment Eliminations | | Total | Net sales | | | | | | | | | | | | | | | Products | $ | 192,636 | | $ | — | | $ | — | | $ | (986) | | $ | 191,650 | Services | | 90,712 | | | 73,186 | | | — | | | (43) | | | 163,855 | Total net sales | | 283,348 | | | 73,186 | | | — | | | (1,029) | | | 355,505 | Cost of sales | | | | | | | | | | | | | | | Products (1) | | 124,880 | | | — | | | — | | | (986) | | | 123,894 | Services (1) | | 50,921 | | | 43,721 | | | — | | | (43) | | | 94,599 | Depreciation and amortization | | 5,757 | | | 2,651 | | | — | | | — | | | 8,408 | Total cost of sales | | 181,558 | | | 46,372 | | | — | | | (1,029) | | | 226,901 | Gross profit | | 101,790 | | | 26,814 | | | — | | | — | | | 128,604 | Operating expenses | | 26,612 | | | 4,049 | | | 51,091 | | | — | | | 81,752 | Income (loss) from operations | $ | 75,178 | | $ | 22,765 | | $ | (51,091) | | $ | — | | $ | 46,852 | | | | | | | | | | | | | | | | EBITDA by segment: | | | | | | | | | | | | | | | Income (loss) from operations | $ | 75,178 | | $ | 22,765 | | $ | (51,091) | | $ | — | | $ | 46,852 | Depreciation and amortization | | 6,585 | | | 2,827 | | | 2,806 | | | — | | | 12,218 | Other expense | | (32) | | | (3) | | | (3,629) | | | — | | | (3,664) | EBITDA | $ | 81,731 | | $ | 25,589 | | $ | (51,914) | | $ | — | | $ | 55,406 | | | | | | | | | | | | | | | | Gross profit margin | | 35.9% | | | 36.6% | | | * | | | * | | | 36.2% | EBITDA margin | | 28.8% | | | 35.0% | | | * | | | * | | | 15.6% |
| * | Calculation not meaningful. |
| (1) | Exclusive of depreciation and amortization. |
Reconciliation of Net Income to EBITDA | | | | | | | | | | | | | Three Months Ended September 30, | | Nine Months Ended September 30, | | 2025 | | 2024 | | 2025 | | 2024 | Net income | $ | 2,308 | | $ | 1,293 | | $ | 7,600 | | $ | 12,749 | Interest, net | | 8,746 | | | 13,458 | | | 24,500 | | | 26,413 | Income tax expense (benefit) | | 1,435 | | | (474) | | | 3,921 | | | 4,026 | Depreciation and amortization | | 6,115 | | | 4,153 | | | 15,877 | | | 12,218 | EBITDA | $ | 18,604 | | $ | 18,430 | | $ | 51,898 | | $ | 55,406 |
Balance Sheet Data of Reportable Segments Total assets of the Company’s reportable segments as of September 30, 2025, and December 31, 2024, were as follows: | | | | | | | | | September 30, | | December 31, | | | 2025 | | 2024 | Debit and Credit | | $ | 334,879 | | $ | 248,970 | Prepaid Debit | | | 51,444 | | | 60,621 | Other | | | 20,737 | | | 40,066 | Total assets | | $ | 407,060 | | $ | 349,657 |
Capital Expenditures of Reportable Segments Total capital expenditures of the Company’s reportable segments as of September 30, 2025 and 2024, were as follows: | | | | | | | | | Nine Months Ended September 30, | | | 2025 | | 2024 | Debit and Credit | | $ | 10,681 | | $ | 2,800 | Prepaid Debit | | | 2,809 | | | 1,382 | Other | | | 287 | | | 17 | Total capital expenditures | | $ | 13,777 | | $ | 4,199 |
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