[Management View]
VerifyMe's management emphasized a strategic focus on capital allocation towards acquisitions and increasing interest earnings. The company is prioritizing the expansion of directly contracted PeriShip customers as a key driver for future organic growth, supported by enhanced marketing and business development activities.

[Outlook]
Management anticipates that revenue and operational impacts from the new freight carrier will not be material until 2026 due to technology integration timelines and shipping seasonality. The company is exploring both tuck-in and transformative acquisitions without pressure to act quickly, leveraging its strong capital structure.

[Financial Performance]
- Revenue: $4.5 million in Q2 2025, down $900,000 YoY.
- Gross Profit: $1.6 million, down $500,000 YoY; gross margin declined to 35% from 39%.
- Operating Expenses: $1.9 million, down from $2.6 million YoY.
- Net Loss: $290,000, improved from $350,000 YoY.
- Adjusted EBITDA: $300,000, up from $200,000 YoY.
- Operating Cash Flow: $700,000, up from $400,000 YoY.
- Period-end Cash: $6.1 million, up from $2.8 million at the end of 2024.

[Q&A Highlights]
Question 1: Do you have the authentication revenue in the quarter?
Answer: Yes, it was $27,000.

Question 2: Do you have the growth excluding the impact of the lost business on PeriShip?
Answer: It's challenging to quantify precisely due to various factors, but the impact is within a single-digit percentage range after accounting for customer insourcing and strategy changes.

Question 3: Regarding the other carrier, do you expect this relationship to be material over the next few quarters?
Answer: Integration will take a few months, and changes are unlikely during peak shipping seasons. Material impact is expected to start in 2026, given the new carrier's larger market share.

Question 4: With a strong cash balance, what are your capital allocation priorities?
Answer: The focus is on transforming PeriShip for scalability and efficiency. While evaluating potential acquisitions, the aim is to deploy capital strategically for shareholder value without rushing decisions.

[Sentiment Analysis]
Analysts and management maintained a cautiously optimistic tone, focusing on strategic growth and disciplined capital management. Management expressed confidence in their strategic direction and capital deployment plans.

[Quarterly Comparison]
| Metric | Q2 2025 | Q2 2024 |
|-------------------------|---------|---------|
| Revenue | $4.5M | $5.4M |
| Gross Profit | $1.6M | $2.1M |
| Gross Margin | 35% | 39% |
| Operating Expenses | $1.9M | $2.6M |
| Net Loss | $290K | $350K |
| Adjusted EBITDA | $300K | $200K |
| Operating Cash Flow | $700K | $400K |
| Period-end Cash | $6.1M | $2.8M |

[Risks and Concerns]
Risks include potential delays in realizing benefits from new carrier integrations and the challenge of identifying suitable acquisition targets. Seasonal shipping fluctuations may also impact short-term performance.

[Final Takeaway]
VerifyMe is strategically focusing on expanding its PeriShip customer base and exploring acquisition opportunities to drive growth. Despite a decline in revenue, the company has improved its financial position through cost management and operational efficiencies. Management remains committed to leveraging its strong balance sheet for strategic growth while maintaining a disciplined approach to capital allocation.