TransAct Technologies Incorporated (NASDAQ:TACT) Q1 2024 Earnings Conference Call May 7, 2024 8:30 AM ET

Company Participants

Ryan Gardella - Investor Relations
John Dillon - Chief Executive Officer
Steve DeMartino - President and Chief Financial Officer

Conference Call Participants

Jeff Martin - ROTH MKM
Jeff Bernstein - Silverberg Bernstein Capital

Operator

Good day, ladies and gentlemen and welcome to the TransAct Technologies First Quarter of 2024 Earnings Call. [Operator Instructions] Please note this conference is being recorded. I will now turn the conference over to Ryan Gardella of Investor Relations. You may begin.

Ryan Gardella

Good morning. Welcome to TransAct Technologies’ first quarter 2024 earnings call. Today, we will be discussing the results announced in our press release issued before market open. Joining us from the company is CEO, John Dillon; President and CFO, Steve DeMartino. Today’s call will include a discussion of the company’s key operating strategies, the progress on those initiatives and details on our first quarter financial results. We will then open the call to participants for questions.

As a reminder, this conference call contains statements about future events and expectations, which are forward-looking in nature. Statements on this call maybe deemed as forward-looking and actual results may differ materially. For a full list of risks inherent to the business and the company, please refer to the company’s SEC filings, including its reports on Forms 10-K and 10-Q. TransAct undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances that occur after the call. Today’s call and webcast may include non-GAAP financial measures within the meaning of SEC Regulation G. When required, reconciliation of all non-GAAP financial measures and most directly comparable financial measures calculated and presented in accordance with GAAP can be found in today’s press release as well as on the company website.

And with that, I’d like to turn the call over to John. John?

John Dillon

Thank you, Ryan and good morning everyone or evening as the case maybe and thank you for joining us today. At a high level, the quarter came in mostly as expected. Total sales were $10.7 million, which is down as expected 52% year-over-year, mostly due to the dynamics that we discussed at the last call relative to casino and gaming. FST, that’s food service technology, recurring revenue increased to $2.4 million versus a year ago period. FST was a bit lighter than expected because two of the larger expected transactions slipped into Q2 and have been or will be closed shortly. Further, we are seeing strong demand for our FST technology from our large QSR client worldwide USA North America, Europe and even in Middle East and Africa are placing orders. On a less positive note one of our large clients, convenience store client is moving to a smartphone application deployment model, single smartphone, and it will replace a considerable amount of our label sales revenue from the ARPU calculations. And while we enjoy the revenue from label sales, it’s not an important revenue stream for us. Nonetheless, it will impact our numbers going forward.