PAR TECHNOLOGY CORP

Previous wording

GAAP - Year-over-year improvement of 620 basis points (bps)

Current wording

GAAP - Year-over-year improvement of 220 basis points (bps)

Previous wording

Net Loss from Cont. Ops.Year-over-year increase of $4.2 million

Current wording

Net Loss from Cont. Ops.Year-over-year decrease of $2.5 million

Previous wording

Adjusted EBITDAYear-over-year improvement of $14.7 million

Current wording

Adjusted EBITDAYear-over-year improvement of $9.9 million

Previous wording

The U.S. government has recently implemented a series of significant new tariffs on imports from several countries where we source certain components and hardware products. These actions, along with retaliatory tariffs imposed by other countries, have introduced increased uncertainty into global trade policies and supply chains. We continue to monitor macroeconomic trends and uncertainties such as the effects of these recently implemented tariffs, and the potential imposition of modified or additional tariffs, which may have adverse effects on our hardware revenue and hardware gross margin. As a result of these tariffs, we anticipate increased supply chain challenges, commodity cost volatility, and consumer and economic uncertainty due to rapid changes in global trade policies. We are continuing to evaluate and implement mitigating actions, including potential supply chain resiliency movements and cost or pricing measures, if needed, as the tariff environment evolves.

Current wording

The tariff environment is complex and evolving. Beginning in the second quarter of 2025, the U.S. government implemented a series of significant new tariffs, including on imports from several countries where we source certain components and hardware products. Other countries have responded with retaliatory actions or plans for retaliatory actions. Some of these tariff announcements have since been followed by announcements of limited exemptions and temporary pauses. These actions have introduced increased uncertainty into global trade policies and supply chains. We continue to monitor macroeconomic trends and uncertainties in light of continuing changes to global tariff policies, which may have adverse effects on our hardware revenue and hardware gross margin. As a result of these events, we anticipate increased supply chain challenges, commodity cost volatility, and consumer and economic uncertainty due to rapid changes in global trade policies. We are continuing to evaluate and implement mitigating actions, including potential supply chain resiliency movements and cost or pricing measures, if needed, as the tariff environment evolves.

Previous wording

Professional service revenues were $13.6 million for the three months ended March 31, 2025, which remained relatively unchanged from $13.5 million for the three months ended March 31, 2024.

Current wording

Professional service revenues were $13.6 million for the three months ended June 30, 2025, which remained relatively unchanged from $13.2 million for the three months ended June 30, 2024.

Previous wording

Subscription service revenues were $68.4 million for the three months ended March 31, 2025, an increase of $30.0 million or 78.2% compared to $38.4 million for the three months ended March 31, 2024. The increase was substantially driven by increased Engagement Cloud subscription service revenues of $20.9 million, of which $16.7 million was driven by inorganic revenue growth contributed by the Plexure product line and the inclusion of approximately two additional months of PAR Retail product line revenues in the current period. The residual increase of $4.2 million from Engagement Cloud subscription service revenues was driven by 15.3% organic growth in active sites. Operator Cloud subscription service revenues increased $9.1 million, of which $6.1 million was driven by inorganic revenue growth contributed by the TASK and Delaget product lines. The residual increase of $3.0 million from Operator Cloud subscription services was driven by 11.0% organic growth in active sites and 3.3% organic growth in average revenue per site driven by cross-selling initiatives, upselling, and price increases.

Current wording

Subscription service revenues were $140.3 million for the six months ended June 30, 2025, an increase of $57.1 million or 68.5% compared to $83.3 million for the six months ended June 30, 2024. The increase was substantially driven by increased Engagement Cloud subscription service revenues of $39.7 million, of which $28.3 million was attributable to inorganic revenue growth contributed by the Plexure product line, the GoSkip Asset Acquisition, and the inclusion of approximately two additional months of revenue from the existing PAR Retail business in the current period. The residual increase of $11.4 million from Engagement Cloud subscription services was driven by 14.4% organic growth in active sites. Operator Cloud subscription service revenues increased $17.4 million, of which $12.0 million was attributable to inorganic revenue growth contributed by the TASK and Delaget product lines. The residual increase of $5.4 million from Operator Cloud subscription services was driven by 11.2% organic growth in active sites.

Previous wording

Hardware revenues were $21.8 million for the three months ended March 31, 2025, an increase of $3.6 million or 19.8% compared to $18.2 million for the three months ended March 31, 2024. The increase primarily consists of increased terminals sales of $1.6 million, peripherals (scanners, printers, and components) sales of $1.4 million, and kitchen display systems sales of $0.4 million. These increases were substantially driven by price increases, the timing of tier one enterprise customer hardware refresh cycles, and the timing of onboarding of Operator Cloud customers buying hardware. Hardware revenues will continue to be affected by the timing of the aforementioned drivers.

Current wording

Hardware revenues were $48.7 million for the six months ended June 30, 2025, an increase of $10.4 million or 27.0% compared to $38.3 million for the six months ended June 30, 2024. The increase was primarily driven by increased revenues from sales of terminals of $5.0 million, kitchen display systems of $1.7 million, peripherals (scanners, printers, and components) of $1.1 million, and an increase in international sales of $1.3 million. These increases were substantially driven by price increases, the timing of tier one enterprise customer hardware refresh cycles, and the timing of onboarding of Operator Cloud customers buying hardware. Hardware revenues will continue to be affected by the timing the aforementioned drivers.

Previous wording

Total gross margin as a percentage of total revenue for the three months ended March 31, 2025, increased to 46.5% as compared to 37.2% for the three months ended March 31, 2024.

Current wording

Total gross margin as a percentage of total revenue for the three months ended June 30, 2025, increased to 45.4% as compared to 41.0% for the three months ended June 30, 2024.

Previous wording

Subscription service gross margin as a percentage of subscription service revenue for the three months ended March 31, 2025, increased to 57.8% as compared to 51.6% for the three months ended March 31, 2024. The increase was substantially driven by a continued focus on efficiency improvements with our hosting and customer support costs, as well as improved gross margins stemming from post-acquisition operations of the PAR Retail, TASK, and Delaget product lines.

Current wording

Subscription service gross margin as a percentage of subscription service revenue for the three months ended June 30, 2025, increased to 55.3% as compared to 53.1% for the three months ended June 30, 2024. The increase was substantially driven by a continued focus on efficiency improvements with our hosting and customer support costs, as well as improved gross margins stemming from post-acquisition operations of the Delaget product line.

Previous wording

Hardware gross margin as a percentage of hardware revenue for the three months ended March 31, 2025, increased to 24.6% as compared to 22.3% for the three months ended March 31, 2024. The increase was primarily driven by a more favorable product mix, with a higher proportion of higher-margin hardware sales in the three months ended March 31, 2025, as well as a year-over-year reduction in compensation expense as we aligned our hardware-related workforce with organizational priorities.

Current wording

Hardware gross margin as a percentage of hardware revenue for the three months ended June 30, 2025, increased to 27.3% as compared to 22.8% for the three months ended June 30, 2024. The increase was primarily driven by a more favorable product mix, with a higher proportion of higher-margin hardware sales in the current period, as well as a year-over-year reduction in compensation expense as we aligned our hardware-related workforce with organizational priorities.

Previous wording

Professional service gross margin as a percentage of professional service revenue for the three months ended March 31, 2025, increased to 25.4% as compared to 16.5% for the three months ended March 31, 2024. The increase primarily consists of increased margins for field operations and hardware service repair substantially driven by improved cost management and reductions in third-party spending.

Current wording

Professional service gross margin as a percentage of professional service revenue for the three months ended June 30, 2025, increased to 28.7% as compared to 27.5% for the three months ended June 30, 2024. The increase was primarily driven by higher gross margins for field operations and hardware service repair, substantially driven by improved cost management and reductions in third-party spending.

Previous wording

S&M expenses were $11.8 million for the three months ended March 31, 2025, an increase of $0.9 million or 7.8% compared to $10.9 million for the three months ended March 31, 2024. The increase was substantially driven by a $2.3 million increase in inorganic S&M expense, stemming from post-acquisition operations of TASK Group and Delaget, as well as the inclusion of approximately two additional months of PAR Retail S&M expense in the current period. Organic S&M expense decreased by $1.4 million, primarily driven by a $0.8 million decrease in marketing costs and a $0.4 million decrease in compensation expense, reflecting continued realization of synergies in our sales and marketing model.

Current wording

S&M expenses were $24.1 million for the six months ended June 30, 2025, an increase of $3.3 million or 16.0% compared to $20.7 million for the six months ended June 30, 2024. The increase was substantially driven by a $4.2 million increase in inorganic S&M expense, stemming from post-acquisition operations of TASK Group and the Delaget product line, as well as the inclusion of approximately two additional months of PAR Retail S&M expense in the current period. Organic S&M expense decreased by $0.9 million primarily driven by a decrease in compensation expense, reflecting continued realization of synergies in our sales and marketing model.

Previous wording

The residual decrease was substantially driven by certain non-cash or non-recurring expenses consisting of a $2.2 million decrease in costs related to transaction due diligence and a $0.7 million decrease in one-time severance costs, partially offset by a $2.3 million increase in stock-based compensation expense.

Current wording

G&A expenses were $31.7 million for the three months ended June 30, 2025, an increase of $6.3 million or 24.9% compared to $25.4 million for the three months ended June 30, 2024. The increase was substantially driven by a $4.8 million increase in inorganic G&A expense stemming from post-acquisition operations of TASK Group and the Delaget product line. Organic G&A expense increased $1.5 million, primarily driven by certain non-cash or non-recurring expenses consisting of a $1.3 million one-time litigation expense in the current period and a $0.9 million increase in stock-based compensation expense, partially offset by a $1.1 million decrease in costs related to transaction due diligence.

Previous wording

G&A expenses were $29.3 million for the three months ended March 31, 2025, an increase of $4.1 million or 16.3% compared to $25.2 million for the three months ended March 31, 2024. The increase was substantially driven by a $5.5 million increase in inorganic G&A expense stemming from post-acquisition operations of TASK Group and Delaget, as well as the inclusion of approximately two additional months of PAR Retail G&A expense in the current period, partially offset by a $0.7 million decrease in organic variable compensation expense.

Current wording

G&A expenses were $61.0 million for the six months ended June 30, 2025, an increase of $10.4 million or 20.6% compared to $50.5 million for the six months ended June 30, 2024. The increase was driven by a $10.3 million increase in inorganic G&A expense stemming from post-acquisition operations of TASK Group and the Delaget product line, as well as the inclusion of approximately two additional months of PAR Retail G&A expense in the current period. Organic G&A expense was relatively flat year-over-year.

Previous wording

R&D expenses were $19.8 million for the three months ended March 31, 2025, an increase of $4.0 million or 25.4% compared to $15.8 million for the three months ended March 31, 2024. The increase was substantially driven by a $3.6 million increase in inorganic R&D expense stemming from post-acquisition operations of TASK Group and Delaget, as well as the inclusion of approximately two additional months of PAR Retail R&D expense in the current period. Organic R&D expense increased by $0.4 million driven by higher outsourced development costs as we continue to work to improve and diversify our product and service offerings.

Current wording

R&D expenses were $20.9 million for the three months ended June 30, 2025, an increase of $4.7 million or 28.9% compared to $16.2 million for the three months ended June 30, 2024. The increase was substantially driven by a $2.6 million increase in inorganic R&D expense stemming from post-acquisition operations of TASK Group and the Delaget product line, as well as R&D expense resulting from the integration of assets acquired in the GoSkip Asset Acquisition. Organic R&D expense increased by $2.1 million primarily driven by higher outsourced development costs as we continue to work to improve and diversify our product and service offerings.

Previous wording

Amortization of identifiable intangible assets was $3.3 million for the three months ended March 31, 2025, an increase of $2.3 million as compared to $0.9 million for the three months ended March 31, 2024. The increase primarily consists of an increase in amortizable intangible assets stemming from the Stuzo Acquisition, TASK Group Acquisition, Delaget Acquisition, and GoSkip Asset Acquisition.

Current wording

Amortization of identifiable intangible assets was $6.7 million for the six months ended June 30, 2025, an increase of $3.8 million as compared to $2.9 million for the six months ended June 30, 2024. The increase was primarily driven by an increase in amortizable intangible assets stemming from the Stuzo Acquisition, TASK Group Acquisition, Delaget Acquisition, and GoSkip Asset Acquisition.

Previous wording

Other expense, net was $0.1 million for the three months ended March 31, 2025, a decrease of $0.4 million compared to other income, net of $0.3 million for the three months ended March 31, 2024. The change was substantially driven by increases in foreign currency transaction losses and other miscellaneous expenses.

Current wording

Other expense, net was $1.4 million for the three months ended June 30, 2025, an increase of $0.8 million compared to $0.6 million for the three months ended June 30, 2024. The increase was substantially driven by increases in foreign currency transaction losses and other miscellaneous expenses.

Previous wording

Loss on extinguishment of debt was $5.8 million for the three months ended March 31, 2025, related to early repayment of the Credit Facility. There was no comparable loss on extinguishment of debt for the three months ended March 31, 2024.

Current wording

Loss on extinguishment of debt was $5.8 million for the six months ended June 30, 2025, related to early repayment of the Credit Facility. There was no comparable loss on extinguishment of debt for the six months ended June 30, 2024.

Previous wording

Provision for income taxes was $1.3 million for the three months ended March 31, 2025, a change of $9.1 million as compared to a benefit from income taxes of $7.8 million for the three months ended March 31, 2024. The change was primarily driven by the absence of a one-time benefit recorded in the prior year, resulting from a reduction in the valuation allowance related to deferred tax liabilities established in connection with the Stuzo Acquisition. The provision recorded during the three months ended March 31, 2025 primarily related to federal and state income tax expense.

Current wording

Provision for income taxes was $2.2 million for the six months ended June 30, 2025, a change of $9.4 million as compared to a benefit from income taxes of $7.2 million for the six months ended June 30, 2024. The change was primarily driven by the absence of a one-time benefit recorded in the prior year, resulting from a reduction in the valuation allowance related to deferred tax liabilities established in connection with the Stuzo Acquisition. The provision recorded during the six months ended June 30, 2025 primarily related to foreign and state income tax expense.

Previous wording

Net income from discontinued operations was $0.2 million for the three months ended March 31, 2025, a decrease of $1.9 million as compared to $2.1 million for the three months ended March 31, 2024. The decrease was primarily driven by PGSC and RRC operating income only being present for the three months ended March 31, 2024, compared to a gain from the divestiture of RRC recognized during the three months ended March 31, 2025.

Current wording

Net income from discontinued operations was $0.2 million for the six months ended June 30, 2025, a decrease of $79.7 million as compared to $79.9 million for the six months ended June 30, 2024. During the six months ended June 30, 2024, a $76.8 million gain from the divestiture of PGSC was recognized. The residual amount represents PGSC and RRC operating income, offset by a provision for income taxes relating to the gain from the divestiture of PGSC. During the six months ended June 30, 2025, a $0.2 million gain from the divestiture of RRC was recognized as a result of a favorable net working capital settlement.

Previous wording

•Engagement Cloud consisting of Punchh, PAR Retail (including GoSkip), PAR Ordering, and Plexure product offerings.

Current wording

•Engagement Cloud consisting of PAR Engagement (Punchh and PAR Ordering), PAR Retail (including GoSkip), and Plexure product offerings.

Previous wording

The tables below provide reconciliations between net loss and adjusted EBITDA, diluted net loss per share and non-GAAP diluted net loss per share, and subscription service gross margin percentage and non-GAAP subscription service gross margin percentage. Amounts presented in the reconciliations and other tables presented herein may not sum due to rounding.

Current wording

The tables below provide reconciliations between net (loss) income and adjusted EBITDA, diluted net (loss) income per share and non-GAAP diluted net income (loss) per share, and subscription service gross margin percentage and non-GAAP subscription service gross margin percentage. Amounts presented in the reconciliations and other tables presented herein may not sum due to rounding.

Previous wording

Our primary sources of liquidity are cash and cash equivalents. As of March 31, 2025, we had cash and cash equivalents of $91.7 million. Cash and cash equivalents consist of highly liquid investments with maturities of 90 days or less, including money market funds.

Current wording

Our primary sources of liquidity are cash and cash equivalents. As of June 30, 2025, we had cash and cash equivalents of $85.1 million. Cash and cash equivalents consist of highly liquid investments with maturities of 90 days or less, including money market funds.

Previous wording

Cash used in operating activities was $17.2 million for the three months ended March 31, 2025, compared to $23.6 million for the three months ended March 31, 2024. The decrease in cash used in operating activities was primarily driven by improved profitability from our core operations.

Current wording

Cash used in operating activities was $23.8 million for the six months ended June 30, 2025, compared to $37.4 million for the six months ended June 30, 2024. The decrease in cash used in operating activities was primarily driven by improved profitability from our core operations.

Previous wording

Cash used in investing activities was $5.7 million for the three months ended March 31, 2025 compared to $151.9 million for the three months ended March 31, 2024. Cash used in investing activities during the three months ended March 31, 2025 included $4.3 million of cash consideration paid in connection with the GoSkip Asset Acquisition and capital expenditures of $1.1 million for developed technology costs associated with our software platforms, partially offset by $0.2 million of cash consideration received in connection with the disposition of RRC.

Current wording

Cash used in investing activities was $7.7 million for the six months ended June 30, 2025 compared to $72.9 million for the six months ended June 30, 2024. Cash used in investing activities during the six months ended June 30, 2025 included $4.3 million of cash consideration paid in connection with the GoSkip Asset Acquisition and capital expenditures of $2.4 million for developed technology costs associated with our software platforms, partially offset by $0.2 million of cash consideration received in connection with the divestiture of RRC. The greater amount of cash used in investing activities during the six months ended June 30, 2024 was largely driven by the Stuzo Acquisition during that period, which was partially offset by $87.1 million of cash consideration received in connection with the divestiture of PGSC and $9.4 million of proceeds from net sales of short-term held-to-maturity investments.

Previous wording

Cash provided by financing activities was $10.7 million for the three months ended March 31, 2025, compared to $190.8 million for the three months ended March 31, 2024. Cash provided by financing activities during the three months ended March 31, 2025 primarily consisted of the net proceeds from the sale of the 2030 Notes of $111.1 million (net of issuance costs), partially offset by the repayment in full of $90 million principal amount outstanding under the Credit Facility plus accrued interest and prepayment premium. We do not have any off-balance sheet arrangements or obligations.

Current wording

Cash provided by financing activities was $11.4 million for the six months ended June 30, 2025, compared to $191.5 million for the six months ended June 30, 2024. Cash provided by financing activities during the six months ended June 30, 2025 primarily consisted of the net proceeds from the sale of the 2030 Notes of $111.1 million (net of issuance costs), partially offset by the repayment in full of $90 million principal amount outstanding under the Credit Facility plus accrued interest and prepayment premium. Cash provided by financing activities during the six months ended June 30, 2024 primarily consisted of a private placement of common stock of $194.5 million (net of issuance costs). We do not have any off-balance sheet arrangements or obligations.

Previous wording

We expect our available cash and cash equivalents will be sufficient to meet our operating needs for at least the next 12 months. Over the next 12 months our total contractual obligations are $53.8 million, consisting of purchase commitments for normal operations (purchase of inventory, software licensing, use of external labor, and third-party cloud services) of $44.6 million, interest payments on long-term debt of $6.5 million and facility lease obligations of $2.7 million. We expect to fund such commitments with cash provided by operating activities and our sources of liquidity.

Current wording

We expect our available cash and cash equivalents will be sufficient to meet our operating needs for at least the next 12 months. Over the next 12 months our total contractual obligations are $72.1 million, consisting of purchase commitments for normal operations (purchase of inventory, software licensing, use of external labor, and third-party cloud services) of $43.3 million, interest payments of $6.4 million and principal payments of $20.0 million related to long-term debt, and facility lease obligations of $2.4 million. We expect to fund such commitments with cash provided by operating activities and our sources of liquidity.

Previous wording

Our non-current contractual obligations are $445.7 million, consisting of purchase commitments for normal operations (purchase of inventory, software licensing, use of external labor, and third-party cloud services) of $25.6 million, interest payments of $13.6 million and principal payments of $400.0 million related to long-term debt, and facility leases of $6.5 million. Refer to “Note 8 – Debt” of the notes to interim condensed consolidated financial statements in "Part I, Item 1. Financial Statements (unaudited)" of this Quarterly Report for additional information. We expect to fund such commitments with cash provided by operating activities, our sources of liquidity, and if necessary, equity, equity-linked, or debt financing arrangements.

Current wording

Our non-current contractual obligations are $419.3 million, consisting of purchase commitments for normal operations (purchase of inventory, software licensing, use of external labor, and third-party cloud services) of $21.0 million, interest payments of $12.0 million and principal payments of $380.0 million related to long-term debt, and facility leases of $6.3 million. Refer to “Note 8 – Debt” of the notes to interim condensed consolidated financial statements in "Part I, Item 1. Financial Statements (unaudited)" of this Quarterly Report for additional information. We expect to fund such commitments with cash provided by operating activities, our sources of liquidity, and if necessary, equity, equity-linked, or debt financing arrangements.