• Revenue: $105 million in Q4, a 50% increase year-over-year.
• Subscription Services ARR: $276 million, more than doubled from last year with 21% organic growth.
• Adjusted EBITDA: $5.8 million, more than doubling sequentially from the previous quarter.
• Net Loss from Continuing Operations: $25 million or $0.68 loss per share, compared to $22 million or $0.77 loss per share in the prior year.
• Non-GAAP Net Loss: $37,000 or effectively $0.00 per share, improved from $12 million or $0.43 loss per share in the prior year.
• Gross Margin: $45 million, an increase of 86% from the prior year.
• Subscription Services Revenue: $64 million, a 55% increase from the prior year.
• Hardware Revenue: $26 million, a 7% increase from the prior year.
• Professional Service Revenue: $15 million, a 17% increase from the prior year.
• Cash and Cash Equivalents: $108 million as of December 31, 2024.
• Cash Flow from Operating Activities: Positive $3 million for Q4.
• Annual Recurring Revenue (ARR): Increased 102% year-over-year.

• Warning! GuruFocus has detected 4 Warning Signs with PAR.

Release Date: February 28, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• PAR Technology Corp (NYSE:PAR) reported a significant revenue increase of over 50% year-over-year in Q4 2024, reaching $105 million.
• Subscription services ARR more than doubled to $276 million, with 21% organic growth compared to Q4 2023.
• Adjusted EBITDA improved significantly, more than doubling sequentially to $5.8 million, indicating strong margin expansion potential.
• The company signed 8 new customer logos in Q4, all selecting multiple products, validating their 'Better Together' strategy.
• PAR Technology Corp's acquisition of Delegate is expected to accelerate cross-sales and expand their market reach, with strong customer interest already evident.

Negative Points

• Net loss from continuing operations for Q4 2024 was $25 million, slightly higher than the $22 million loss reported in the same period in 2023.
• The rollout of new products for Burger King is expected to delay the timeline by a quarter and a half, potentially impacting short-term revenue.
• Hardware margins decreased to 26% from 29% in the prior year, partly due to one-time inventory adjustments in Q4 2023.
• Operating expenses increased by 25% year-over-year, driven by M&A transaction fees and stock-based compensation.
• The company faces challenges in the full-service dining space, with a slowdown impacting some of their customer segments.

Q & A Highlights

Q: Savneet, I wanted to start with the upsell into BK. Does this change the timeline of the rollout? And also does it change the ARR opportunity? A: Yes to both. It'll probably push us out a quarter and a half, with Q1 being used to sequence the rollout. Starting in Q2, we can do a combined rollout, which will accelerate from Q2 onwards. This significantly adds to the ARR opportunity, although we haven't disclosed the exact number yet.

Q: Can you provide any color on the quarterly cadence for revenue and margins in 2025? A: You should see meaningful margin expansion and revenue growth acceleration in the second half of the year, tied to the Burger King rollout and other deals. Q1 and Q2 will involve significant investment to ensure successful rollouts, with more revenue growth and EBITDA expansion expected in the latter half.

Q: Can you remind us what all is included in the Burger King contract now? A: The core deal is for POS, with parts of MenuLink included. The expansion into PAR ops is on Data Central, and we hope to integrate Delegate as well, although that's not guaranteed yet.

Q: How are you thinking about organic ARR growth in 2025? A: We expect higher growth rates in the second half of the year due to the payment services deal, Burger King acceleration, and the convenience store deal. We have significant visibility into these rollouts, which are signed and committed, not just pipeline opportunities.

Q: What are you seeing in the restaurant space regarding consumer trends? A: There's a wide disparity of outcomes. Full-service dining is slowing, which has helped our Punchh business as firms invest in loyalty. Our core QSR and fast-casual space is seeing a slowdown but not negative comps. Single stores and small chains are experiencing significant pain due to lack of brand strength and technology investments.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.