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What changed in CANTALOUPE, INC.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of CANTALOUPE, INC.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+242 added−210 removedSource: 10-K (2025-09-08) vs 10-K (2024-09-10)

Top changes in CANTALOUPE, INC.'s 2025 10-K

242 paragraphs added · 210 removed · 152 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

37 edited+14 added−30 removed61 unchanged
Biggest changeTRADEMARKS, PROPRIETARY INFORMATION, AND PATENTS The Company owns US federal and foreign registrations for the following trademarks and service marks: Because Machines Can’t Cry For Help®, Blue Light Sequence (design only) Business Express®, Cantaloupe circle logo (design only), Cantaloupe Systems®, Cantaloupe Systems & design (Cantaloupe circle logo), CM2iQ®, COMPUVEND®, EnergyMiser®, ePort®, ePort Connect®, ePort Mobile & design, eSuds®, Intelligent Vending®, Routemaster®, Seed®, Seed & design, Seed Office®, SnackMiser®, TransAct®, USA Technologies®, USA Technologies & design, USALIVE®, VendingMiser®, VendPro®, VM2iQ®, Warehouse Master®, YOKE®, TSM Smart Lock®, and Cooler Cafe®.
Biggest changeWe are continually monitoring and evaluating manufacturing partners to accommodate our growth objectives while minimizing risks of disruption within our supply chain operations. 12 TRADEMARKS, PROPRIETARY INFORMATION, AND PATENTS The Company owns US federal and foreign registrations for the following trademarks and service marks: Because Machines Can’t Cry For Help®, Blue Light Sequence (design only) BUSINESS EXPRESS®, CANTALOUPE®, Cantaloupe circle logo (design only), Cantaloupe Systems®, Cantaloupe Systems & design (Cantaloupe circle logo), CM2IQ®, COMPUVEND®, COOLER CAFE®, EnergyMiser®, ePort®, EPORT CONNECT®, INTELLIGENT VENDING®, PICK-EASY®, PICK-EASY & design, RETAIL RENEGADES®, ROUTEMASTER®, SEED®, seed & design, SEED OFFICE®, TSM SMART LOCK®, VendPro®, VM2IQ®, YOKE®.
Based on various in-country features, these devices are equipped with digital touch screens and can easily accept all major forms of payments in the countries in which they serve today. The P30 is also used as the primary payment terminal in the United States for the our Cooler Cafe solution.
Based on various in-country features, these devices are equipped with digital touch screens and can easily accept all major forms of payments in the countries in which they serve today. The P30 is also used as the primary payment terminal in the United States for our Cooler Cafe solution.
The Cheq platform seamlessly integrates with over 10 partners today to support the unique business needs of clients and their venues. 8 • Seed API (formerly known as Quick Connect), is an API web service that allows a client application to securely interface with the Company’s payment processing and asset managing services. • Additional services include our Cantaloupe Go consumer mobile app loyalty programs, campus card integrations, digital ad-management, and data warehouse services.
The Cheq platform seamlessly integrates with over 10 partners today to support the unique business needs of clients and their venues. • Seed API (formerly known as Quick Connect), is an API web service that allows a client application to securely interface with the Company’s payment processing and asset managing services. • Additional services include our Cantaloupe Go consumer mobile app loyalty programs, campus card integrations, digital ad-management, and data warehouse services.
This kiosk includes a 43” touchscreen, built-in camera, barcode scanner, biometric scanner, bill acceptor (optional), 7 cash in/out available, customization options for colors and decals, and accessibility features for the visually impaired as well as ADA height compliant features. • The Cooler Café is designed to deliver the micro market experience with a smaller footprint.
This kiosk includes a 43” touchscreen, built-in camera, barcode scanner, biometric scanner, bill acceptor (optional), cash in/out available, customization options for colors and decals, and accessibility features for the visually impaired as well as ADA height compliant features. • The Cooler Café is designed to deliver the micro market experience with a smaller footprint.
We are continuously seeking to enhance our solutions and services with additional features and functionality that create add-on service offerings to existing customers 10 such as RPC, Seed Markets, Seed Analytics, Seed Pick Easy, and Cantaloupe Go POS solutions. We believe our continued innovation will lead to further adoption of Cantaloupe’s solutions and services in the self-service market.
We are continuously seeking to enhance our solutions and services with additional features and functionality that create add-on service offerings to existing customers such as RPC, Seed Markets, Seed Analytics, Seed Pick Easy, and Cantaloupe Go POS solutions. We believe our continued innovation will lead to further adoption of Cantaloupe’s solutions and services in the self-service market.
We believe the following industry trends are driving growth in demand for digital payment systems and advanced logistics management both in general and within the specific markets we serve: • Increased adoption of cashier-less models via vending machines, self-service kiosks, and mobile ordering to meet demand for and more use of fast, simple and seamless digital purchase and payment experiences; • Rising consumer demand for transaction convenience, safety, and security, as evidenced by the growth in digital payment adoption, especially contactless payments; and • Ongoing labor challenges and inflation drive increased utility of actionable operational business intelligence from new technologies like machine learning and artificial intelligence (AI) to drive operational efficiencies and operational transparency through modern, cloud-based logistics and inventory management solutions.
We believe the following industry trends are driving growth in demand for digital payment systems and advanced logistics management both in general and within the specific markets we serve: • Increased adoption of cashier-less models via vending machines, self-service kiosks, automated stores, and mobile ordering to meet demand for and more use of fast, simple and seamless digital purchase and payment experiences; • Rising consumer demand for transaction convenience, safety, and security, as evidenced by the growth in digital payment adoption, especially contactless payments; and • Ongoing labor challenges and inflation drive increased utility of actionable operational business intelligence from new technologies like machine learning and artificial intelligence ("AI") to drive operational efficiencies and operational transparency through modern, cloud-based logistics and inventory management solutions.
Devices and POS terminals operating on the Company’s platform and using our services include those resulting from the sale, finance or a monthly bundled subscription (Cantaloupe ONE program) of our POS electronic payment devices and checkout kiosks, telemetry devices, certified payment software or the servicing of similar third-party installed POS terminals and telemetry devices.
Devices and POS terminals operating on the Company’s platform and using our services include those resulting from the sale, finance or a monthly bundled subscription (Cantaloupe ONE program) of our POS electronic payment devices and 5 checkout kiosks, telemetry devices, certified payment software or the servicing of similar third-party installed POS terminals and telemetry devices.
Like our kiosks, our Cheq POS terminals process payments and transmit transaction data into 6 the Cheq platform via the cloud, while also seamlessly integrating into a variety of venue applications. Our Cheq POS terminals also offer a robust back-end reporting platform for ease of venue management.
Like our kiosks, our Cheq POS terminals process payments and transmit transaction data into the Cheq platform via the cloud, while also seamlessly integrating into a variety of venue applications. Our Cheq POS terminals also offer a robust back-end reporting platform for ease of venue management.
From time to time, we enter into short-term incentive and promotional agreements with the card industry counterparties. • We maintain close relationships with domestic wireless telecommunications carriers and with which we have long-term bespoke pricing and support terms. • We have long-term agreements with our payment processors, each of which is seamlessly integrated with our products and customers. • We have established reseller relationships with select solution providers for add-on features and services within our traditional offerings.
From time to time, we enter into short-term incentive and promotional agreements with the card industry counterparties. • We maintain close relationships with domestic wireless telecommunications carriers with which we have long-term bespoke pricing and support terms. • We have long-term agreements with our payment processors, each of which is seamlessly integrated with our products and customers. • We have established reseller relationships with select solutions providers for add-on features and services within our traditional offerings.
We derive the majority of our revenues from subscription and transaction fees resulting from transactions on, as well as connectivity and telemetry services provided by, our cashless devices, Seed™ software, Cantaloupe Go software, Cheq (acquired February 2024) software, and our API services used via our Seed API (formerly known as Quick Connect) product.
We derive the majority of our revenues from subscription and transaction fees resulting from transactions on, as well as connectivity and telemetry services provided by, our cashless devices, Seed™ software, Cantaloupe Go software, Cheq software (acquired in February 2024), SB Software (acquired in September 2024), and our API services used via our Seed API (formerly known as Quick Connect) product.
Handling more than a billion transactions annually, our solutions enhance operational efficiency and consumer engagement across sectors like food & beverage markets, smart automated retail, hospitality, entertainment venues, laundromats and more. Committed to innovation, we aim to drive advancements in digital payments and business optimization, serving 31,466 customers in the United States., United Kingdom., European Union countries, Australia, and Mexico.
Handling more than a billion transactions annually, our solutions enhance operational efficiency and consumer engagement across sectors like food & beverage markets, smart automated retail, hospitality, entertainment venues, laundromats and more. Committed to innovation, we aim to drive advancements in digital payments and business optimization, serving 34,896 customers in the United States, United Kingdom, European Union countries, Australia, and Mexico.
Much of the technology developed or to be developed by us is subject to trade secret protection. To reduce the risk of loss of trade secret protection through disclosure, we have entered into confidentiality agreements with our key employees. As June 30, 2024, 140 patents have been granted to or acquired since our inception in 1992.
Much of the technology developed or to be developed by us is subject to trade secret protection. To reduce the risk of loss of trade secret protection through disclosure, we have entered into confidentiality agreements with our key employees. As of June 30, 2025, 143 patents have been granted to or acquired since our inception in 1992.
Capitalize on the Emerging Cashless, Contactless, EMV, NFC, and Growing Mobile Payments Trends Globally. With growing consumer adoption of cashless and digital wallet payments, we believe this trend will continue to drive significant opportunity for us to further penetrate cashless transactions in both existing and new markets in the United States and abroad.
Capitalize on the Emerging Cashless, Contactless, EMV, NFC, and Growing Mobile Payments Trends Globally. With growing consumer adoption of cashless and digital wallet payments, we believe this trend will continue to drive significant opportunity for us to further penetrate cashless transactions in both existing and new markets in the United States and abroad. Expand into Micro Markets and Smart Stores.
The devices can be fitted in a range of hardware configurations, including vending, kiosks, amusement parks, and more. • Our P Series, which include the P66, P100, P100Pro and P30, are our card touchscreen card readers that support the UK/EMEA and MX/LAC markets.
The devices can be fitted in a range of hardware configurations, including vending, kiosks, amusement parks, and more. • Our P Series, which include the P66, P100, P100Pro and P30, are our card touchscreen card readers that support the U.K./E.M.E.A. and MX/LAC markets.
This device is currently available in the United States and Canada. • Our Engage Series, which includes the Engage and Engage Combo, are our next generation of digital touchscreen devices designed to provide retailers the ability to captivate consumers in new ways and enables truly frictionless purchasing.
This device is currently available in the United States and Canada. 7 • Our Engage Series, which includes the Engage, Engage Combo, and the Engage Pulse designed specifically for the amusement and entertainment market, are our next generation of digital touchscreen devices designed to provide retailers the ability to captivate consumers in new ways and enables truly frictionless purchasing.
We had 31,466 Active Customers and 1.22 million Active Devices connected to our service as of June 30, 2024 compared to 28,584 Active Customers and 1.17 million Active Devices as of June 30, 2023. HUMAN CAPITAL MANAGEMENT As of June 30, 2024, we had 359 full-time employees compared to 269 full-time employees as of June 30, 2023.
We had 34,896 Active Customers and 1.28 million Active Devices connected to our service as of June 30, 2025 compared to 31,466 Active Customers and 1.22 million Active Devices as of June 30, 2024. HUMAN CAPITAL MANAGEMENT As of June 30, 2025, we had 358 full-time employees compared to 359 full-time employees as of June 30, 2024.
Activities include creating a vibrant company and product presence on the web, digital advertising, Search Engine Optimization (“SEO”), and social media; affiliate and referral programs; our e-commerce store, the use of direct mail and email campaigns; educational online and in-person user conferences; content curation through blogs, white papers, guides, podcasts, and joint industry studies; advertising in vertically-oriented trade publications; participating in industry trade shows and events; and working closely with customers and key strategic partners on co-marketing opportunities that drive customer and consumer adoption of our services. 12 IMPORTANT RELATIONSHIPS Our most important relationships are with our 31,466 customers, which are governed by services agreements that provide for terms and conditions of purchase, rental, subscription or lease of the devices, licensing of our solutions, and processing services.
Activities include creating a vibrant company and product presence on the web, digital advertising, Search Engine Optimization (“SEO”), and social media; affiliate and referral programs; our e-commerce store, the use of direct mail and email campaigns; educational online and in-person user conferences; content curation through blogs, white papers, guides, podcasts, and joint industry studies; advertising in vertically-oriented trade publications; participating in industry trade shows and events; and working closely with customers and key strategic partners on co-marketing opportunities that drive customer and consumer adoption of our services.
Included in the number of Active Devices are devices that communicate through other devices that communicate or transact with us. For example, a self-service retail location that utilizes an ePort cashless payment device as well as Seed management services constitutes only one device. We define Active Customers as all customers with at least one active device.
For example, a self-service retail location that utilizes an ePort cashless payment device as well as Seed management services constitutes only one device. We define Active Customers as all customers with at least one active device.
Under the terms, we typically collect our fees from settled funds, including activation fees, monthly service fees, and transaction processing fees. Our relationships with certain large customers are governed by customized terms and conditions contained within individually negotiated services agreements. In addition to our customer relationships: • We maintain broad and long-standing relationships with card industry associations.
Our relationships with certain large customers are governed by customized terms and conditions contained within individually negotiated services agreements. In addition to our customer relationships: • We maintain broad and long-standing relationships with card industry associations.
We support our services by providing help desk support, repairs, and replacement services. Inbound consumer billing inquiries are handled through a 24‑hour help desk, which reduces our customers’ exposure to consumer billing inquiries and potential chargebacks. We provide remote maintenance updates and enhancements to software, settings, and features to our card readers via wireless connections.
We support our services by providing help desk support, repairs, and replacement services. Inbound consumer billing inquiries are handled through a 24‑hour help desk, which reduces our customers’ exposure to consumer billing inquiries and potential chargebacks.
With the acquisition of Three Square Market in December 2022, we believe we are well positioned to expand across Mexico and Europe, while focusing on increasing market share in the United States.
Capitalize on Opportunities in International Markets. With the acquisitions of Three Square Market in December 2022 and SB Software in September 2024, as well setting up operations in Mexico, we believe we are well positioned to expand across Mexico and Europe, while focusing on increasing market share in the United States.
Transaction fees on volumes processed through our payment devices and POS systems are the most significant driver of our revenues. 5 THE INDUSTRY We offer a variety of solutions for self-service commerce, which enable the acceptance of digital payments and allow our customers to simplify inventory, analytics, warehouse, logistics, and back-office management.
THE INDUSTRY We offer a variety of solutions for self-service commerce, which enable the acceptance of digital payments and allow our customers to simplify inventory, analytics, warehouse, logistics, and back-office management.
AVAILABLE INFORMATION The public may access any materials the Company files with the SEC, including our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements for our annual stockholder meetings, and amendments to those reports, through the SEC’s Interactive Data Electronic Applications system at http://www.sec.gov.
With the information provided by the annual engagement survey, leadership is provided key insights and valuable feedback which we implement in our Company-wide action plans with the intent to focus on key areas to prioritize, enhance, and drive increased employee engagement, learning and development, and professional growth for our employees. 13 AVAILABLE INFORMATION The public may access any materials the Company files with the SEC, including our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements for our annual stockholder meetings, and amendments to those reports, through the SEC’s Interactive Data Electronic Applications system at http://www.sec.gov.
We will pursue intellectual property protection to the extent we believe it would be beneficial and cost-effective. 13 ACTIVE DEVICES AND ACTIVE CUSTOMERS In order to present meaningful information on our business, we report Active Devices and Active Customers. Active Devices are devices that have communicated with us or have had a transaction in the last twelve months.
ACTIVE DEVICES AND ACTIVE CUSTOMERS In order to present meaningful information on our business, we report "Active Devices" and "Active Customers". Active Devices are devices that have communicated with us or have had a transaction in the last twelve months. Included in the number of Active Devices are devices that communicate through other devices that communicate or transact with us.
Many of our competitors are challenging our industry position as an industry leader, particularly when it comes to pricing, emulating products, services, and marketing, as well as addressing consumer trends. However, we believe we have competitive strengths that position us for continued success.
The markets for our products and services are characterized by evolving industry standards, aggressive pricing, continuous innovation, and changing consumer trends. Many of our competitors are challenging our industry position as an industry leader, particularly when it comes to pricing, emulating products, services, and marketing, as well as addressing consumer trends.
We plan to differentiate ourselves by providing a single platform to manage consumer and operational aspects of micro markets and smart coolers, while also integrating multiple service providers for flexibility and ultimate ease to our customers. Capitalize on Opportunities in International Markets.
With our Cantaloupe Go platform, we are expanding the growing vertical of micro markets and smart stores both in near-vending channels as well as adjacent verticals. We differentiate ourselves by providing a single platform to manage consumer and operational aspects of micro markets and smart stores, while also integrating multiple service providers for flexibility and ultimate ease to our customers.
MARKETS WE SERVE While the below key verticals represent only a fraction of our total market potential, as described below, these are the areas where we have seen the most traction to date. 9 Food & Beverage Vending .
MARKETS WE SERVE While the below key verticals represent only a fraction of our total market potential, these are the areas where we have seen the most traction to date. 10 OUR GROWTH OPPORTUNITY Our primary objective is to continue enhancing our position as a leading provider of technology powering self-service commerce.
Of the 140 patents, 49 are still in force as of June 30, 2024. Our patents expire between 2024 and 2038. To the extent renewable, we intend to renew these patents.
Of the 143 patents, 49 are still in force as of June 30, 2025. Our patents expire between 2025 and 2045. To the extent renewable, we intend to renew these patents. We will pursue intellectual property protection to the extent we believe it would be beneficial and cost-effective.
The majority of customers pay a monthly service fee plus a blended percentage rate on transaction volumes.
The majority of customers pay a monthly service fee plus a blended percentage rate on transaction volumes. Transaction fees on volumes processed through our payment devices and POS systems are the most significant driver of our revenues.
Consumers are expecting more from their shopping experience, with access to buy what they want, when they want, with the ability to pay with any shape or form of digital currency. This has led to a multitude of new devices on the market that enable a more engaging experience at the POS.
However, we believe we have competitive strengths that position us for continued success. Consumers are expecting more from their shopping experience, with access to buy what they want, when they want, with the ability to pay with any shape or form of digital currency.
COMPETITION The self-service industry is highly competitive with service providers ranging from well-established enterprises to early-stage companies within the financial technology and software services industries. The markets for our products and services are characterized by evolving industry standards, aggressive pricing, continuous innovation, and changing consumer trends.
We provide remote maintenance updates and enhancements to software, settings, and features to our card readers via wireless connections. 9 COMPETITION The self-service industry is highly competitive with service providers ranging from well-established enterprises to early-stage companies within the financial technology and software services industries.
Cashier-less stores that minimize or remove human intervention have shifted consumer expectations on retail shopping experiences. Retailers are also finding that self-service helps them respond to the ongoing labor challenges and inflation costs they are facing while also appealing to changing consumer habits who are eager to use self-checkout solutions.
Retailers are also finding that self-service helps them respond to the ongoing labor challenges and inflation costs they are facing while also appealing to changing consumer habits who are eager to use self-checkout solutions. 6 OUR SOLUTION We aim to transform self-service commerce by offering one integrated solution for payments processing, logistics, and back-office management.
The headcount increase aligns with our overall objective to reduce reliance on outside consultants which in turn leads to a reduction in certain general and administrative expenses and enables us to instead invest in innovative technologies and products and increase marketing spend to penetrate new and existing customers.
This represents a headcount decrease of less than 1% over prior fiscal year. The headcount aligns with our overall objective to focus on growth both domestically and internationally and enables us to invest in innovative technologies and products and increase marketing spend to penetrate new and existing customers.
As a result, customers can run their businesses more proactively, predictably, and competitively. We offer customers several different ways to connect and manage their distributed assets. These range from our cashless hardware, both attended and self-checkout kiosks, Seed platform, Cantaloupe Go platform, Cheq platform, and API services via Seed API.
These range from our cashless hardware, both attended and self-checkout kiosks, our Seed platform, our Cantaloupe Go platform, our Cheq platform, SB Software, and API services via Seed API.
OUR SOLUTION We aim to transform self-service commerce by offering one integrated solution for payments processing, logistics, and back-office management. Our platform is designed to increase consumier engagement and sales revenue through digital payments, digital advertising, and customer loyalty programs, while providing retailers with control and visibility over their operations and inventory.
Our platform is designed to increase consumer engagement and sales revenue through digital payments, digital advertising, and customer loyalty programs, while providing retailers with control and visibility over their operations and inventory. As a result, customers can run their businesses more proactively, predictably, and competitively. We offer customers several different ways to connect and manage their distributed assets.
In addition, micro markets are becoming one of the largest growth sectors in the convenience services industry, with large competitors owning a majority of the current market share.
This has led to a multitude of new devices on the market that enable a more engaging experience at the POS. In addition, micro markets are becoming larger growth sectors in the convenience services industry, with many competitors.
Production by our manufacturing partners is required to be performed in accordance with our product specifications, quality control and compliance standards. For the years ended June 30, 2024 and June 30, 2023 our manufacturing activities principally took place in the United States, Mexico and the United Kingdom.
Production by our manufacturing partners is required to be performed in accordance with our product specifications, quality control and compliance standards. Our internal processes are centered around quality assurance of materials and testing of finished goods received from our contract manufacturers.
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This solution integrates directly into Seed to enhance operator management. • Our Smart Market, offers customers the micro market experience in a locked format. The consumer walks up to the kiosk first, logs into their account, or swipes their credit/debit card to initiate the coolers and snack section to unlock.
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Merger with 365 Retail Markets, LLC On June 15, 2025, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) with 365 Retail Markets, Catalyst Holdco I, Inc. (“Holdco”), Catalyst Holdco II, Inc. (“Holdco II”) and Catalyst MergerSub Inc. (“Merger Sub”).
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Then they have a set amount of time to grab their items, scan at the kiosk and pay before the market locks again.
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Subject to the terms and conditions of the Merger Agreement, 365 Retail Markets has agreed to acquire the Company in an all-cash transaction for $11.20 per share of common stock, without interest (the “Merger Consideration”).
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Acquired in February 2024, our new Cheq product offerings include a wide range of solutions built specifically for the stadium, entertainment and festival sectors. • The Cheq POS is equipped to serve in both attended and unattended mode.
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Pursuant to the Merger Agreement, and subject to the terms and conditions thereof, Merger Sub will merge with and into the Company (the “Merger”), with the Company surviving the Merger as a wholly-owned, indirect subsidiary of 365 Retail Markets. Upon the consummation of the Merger, Cantaloupe will cease to be a publicly traded company.
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Built with a consumer-friendly user-interface, the Cheq POS register can take orders, accept payments, and integrate into multiple third-party back-end management tools for streamlined processes to venues. The Cheq POS also includes a self-service mode to enable customers to conveniently place their own order to streamline wait times and create less dependency on staff.
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We have agreed to various customary covenants and agreements in the Merger Agreement, including, among others, agreements to conduct our business in the ordinary course during the period between the execution of the Merger Agreement and the effective time of the Merger.
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The Cheq POS accepts credit and debit cards, EMV contactless, mobile wallet, NFC and QR codes. • The Cheq handheld is an all-in-one mobile device that allows venues to take payments on the go.
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We do not believe these restrictions will prevent us from meeting our debt service obligations, ongoing costs of operations, working capital needs, or capital expenditure requirements. On September 4, 2025, the Company held a special meeting of shareholders, where shareholders approved a proposal to approve and adopt the Merger Agreement, including the Merger.
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Built with a long-lasting battery life and the ability to store up to 50,000 transactions offline, venues and festivals can take payments from anywhere with limited access to dedicated power supply stations.
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Assuming timely satisfaction of the remaining necessary closing conditions, including the receipt of required regulatory approvals, we expect that the Merger will be completed in the second half of calendar year 2025.
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The Cheq handheld can accept credit/debit cards, EMV contactless and mobile wallet payments. • The Cheq mobile app, most commonly integrated into existing venue/fan experience apps, provides event-goers the ability to order, pay and pick-up or request in-seat delivery for products anywhere in the venue.
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Upon consummation of the Merger, our common stock will be delisted from The Nasdaq Stock Market LLC and deregistered under Section 12(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
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Integrated with in-venue POS menus, the Cheq mobile app is designed to make ordering from anywhere convenient and easy.
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Additional information about the Merger is set forth in our Current Report on Form 8-K filed with the SEC on September 4, 2025, and our definitive Proxy Statement on Schedule 14A filed with the SEC on July 24, 2025 (the "Definitive Proxy Statement").
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According to the 2022 Automatic Merchandiser State of the Industry Report released in May 2023, the vending and micro market industry grew by 12% in total revenue, representing almost 89% of 2019's benchmark revenue high.
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Cashier-less stores that minimize or remove human intervention have shifted consumer expectations on retail shopping experiences.
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In 2022, the number of locations serviced increased by 76%, showcasing a more back to normal and accelerated self-service experience that is being desired by consumers. Nearly 80% of operators are embracing technology for vending and micro markets.
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Our SB Software platform includes industry-leading Vendmanager and Coffeemanager software solutions that are designed and built for the U.K. and E.M.E.A. vending operator. This platform not only provides efficient business management tools, inventory tracking, routing and logistics, but provides data analytics and reporting to help customers better run their vending, coffee and micro market business.
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Almost 80% of the operators said cashless payment devices are a great investment; 62% and 53% said pre-kitting and vending management systems are also great investments. Micro Markets and Kiosks. While micro markets grow in the traditional vending and food service industry, self-service kiosks are also on the rise.
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This solution integrates directly into Seed to enhance operator management. • The Smart Store Go Micro kiosk, which is Cantaloupe's newest self-service micro market kiosk, designed with affordability, versatility and seamless management in mind.
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In fact, according to the 2023 Kiosk Marketplace Census Report, global sales of interactive kiosks – not counting ATMs and refreshment vending machines – totaled an estimated $14.5 billion in 2022, a 20% increase over the $12.1 billion in 2021 and surpassing the $10.6 billion in 2020.
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Its compact footprint, integrated barcode scanner and five-inch touchscreen provide a seamless checkout experience for consumers and enables operators to manage all their markets regardless of size. 8 • The Cantaloupe Smart Aisle is a frictionless retail experience that operates without an attendant, relying instead on 3D cameras, and weighted-shelf technology to analyze motion and keep track of transactions.
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The report states that, consumer acceptance of e-commerce during the pandemic played an important role in supporting the demand for self-serve kiosks, as the consumer tendency to use technology to shop encouraged brands and retailers to expand self-service offerings. Vehicle Services .
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Customers provide a payment method to enter, and while inside they can grab any item, which is added to their virtual cart in real time. Customers verify their cart before leaving, and the transaction is completed and payment method charged upon exit.
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Our primary opportunities in the vehicle services markets relate to businesses that provide air, vacuum, car wash, and parking services. In these sectors we can provide customers with cashless payment terminals, payment processing, telemetry services for data and connectivity services, as well as software solutions to improve business optimization.
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IMPORTANT RELATIONSHIPS Our most important relationships are with our 34,896 customers, which are governed by services agreements that provide for terms and conditions of purchase, rental, subscription or lease of the devices, licensing of our solutions, and processing services. Under the terms, we typically collect our fees from settled funds, including activation fees, monthly service fees, and transaction processing fees.
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Currently, we partner with a leader in the air vending services by equipping their machines with our cashless acceptance devices. Laundry . Our primary opportunities in laundry consist of the coin-operated commercial laundry and multi-housing laundry markets.
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Currently, our joint solution with an industry leader competes with hardware manufacturers, who provide joint solutions to their customers in partnership with payment processors, and with at least one competitor who provides an integrated hardware and payment processing solution. Amusement and Entertainment.
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Our current customers and primary opportunities in the amusement and entertainment markets are typically classified as “street/route business,” which are standalone businesses that are open to the general public and that offer card/coin-operated games such as claw machines, amusement park machines (i.e. body dryers), bowling alleys and bar entertainment (e.g. digital music machines and dart machines).
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Currently, we partner with one of the largest independent claw machine providers to enable them with cashless acceptance devices and payment processing. Stadium, Venues and Festivals.
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Our current customers and primary opportunities in the entertainment venue and festival markets are anywhere from large venues that house premier professional sports teams including the NHL, NFL, MLB, MLS, as well as other venues such as college stadiums, carnivals, state fairs and those adjacent markets.
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Based on the venue or event, our solutions range from full POS including attended and self-service kiosks, to handhelds and mobile ordering experiences. We provide the payment processing, POS hardware and software services for these venues to manage their operations whether at one event or many throughout a given season. Smart Retail .
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According to a Research And Markets report, published by Vending International Online, the smart vending market is expected to reach a value of $15 billion by 2028 growing with a rate of 12% during 2022 to 2028.
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With self-service technology becoming more popular amongst consumers, retail brands are trying to figure out ways to meet the buyer where they are – airport, train station, grocery store, gas stations, and more. Our current customers today range from implementing Pharambox machines, automated made-to-order pizza machines, to self-service propane tank lockers.
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As the market continues to expand, our primary opportunity is in enabling cashless payments and asset management software for these customers. OUR GROWTH OPPORTUNITY Our primary objective is to continue to enhancing our position as a leading provider of technology powering self-service commerce.
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As the United States completed its 3G upgrades in 2023, similar opportunities still exist in international markets where many legacy systems are still running on 3G networks and will be required to update to 4G LTE. We plan to take advantage of these opportunities to expand cashless acceptance. Expand into Micro Markets and Smart Coolers.
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With our Cantaloupe Go platform, we plan to continue to expand into the growing vertical of micro markets and smart coolers both in near-vending channels as well as adjacent verticals.
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With self-service and self-checkout on the rise, we believe we are well positioned to leverage our integrated offerings to deliver a scalable micro market and smart cooler solution for businesses of all kinds.
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Our internal processes center around quality assurance of materials and testing of finished goods received from our contract manufacturers. We continued to experience certain elevated component and supply chain costs necessary for the production and distribution of our hardware products during the year.
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We are continually monitoring and evaluating manufacturing partners to accommodate our growth objectives while minimizing risks of disruption within our supply chain operations.
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This represents a headcount increase of approximately 33% over prior year. Headcount growth has occurred primarily in our Sales, Customer Support and Technology departments.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeGeneral economic, market or business conditions unrelated to our operating performance, including global supply chain disruptions and inflationary pressures could adversely affect our business and results of operations. The global payments technology industry depends heavily on the overall level of consumer, business and government spending.
Biggest changeWhile we will evaluate and defend against the foregoing any similar actions vigorously, the costs of the defense of such lawsuits and other effects of such litigation, including potential delays to the Merger, could have an adverse effect on our business, financial condition and operating results. 16 Risks related to our business General economic, market or business conditions unrelated to our operating performance, including global supply chain disruptions and inflationary pressures and tariffs could adversely affect our business and results of operations.
Risks relating to our international operations and properties include: • changing governmental rules and policies; • enactment of laws restricting the ability to remove profits earned from activities within a particular country to a person’s or company’s country of origin; • changes in laws or policies governing foreign trade or investment and use of foreign operations or workers, and any negative sentiments towards multinational companies as a result of any such changes to laws, regulations or policies or due to trends such as political populism and economic nationalism; • variations in currency exchange rates and the imposition of currency controls; • adverse market conditions caused by terrorism, civil unrest, natural disasters, infectious disease and changes in international, national or local governmental or economic conditions; 21 • business disruptions arising from public health crises and outbreaks of communicable diseases; • the willingness of U.S. or international lenders to make loans in certain countries and changes in the availability, cost and terms of secured and unsecured debt resulting from varying governmental economic policies; • the imposition of unique tax structures and changes in other tax rates and other operating expenses in particular countries, including the potential imposition of adverse or confiscatory taxes; • the potential imposition of restrictions on currency conversions or the transfer of funds; • general political and economic instability; and • our limited experience and expertise in foreign countries, particularly European countries, relative to our experience and expertise in the United States.
Risks relating to our international operations and properties include: • changing governmental rules and policies; • enactment of laws restricting the ability to remove profits earned from activities within a particular country to a person’s or company’s country of origin; • changes in laws or policies governing foreign trade or investment and use of foreign operations or workers, and any negative sentiments towards multinational companies as a result of any such changes to laws, regulations or policies or due to trends such as political populism and economic nationalism; • variations in currency exchange rates and the imposition of currency controls; • adverse market conditions caused by terrorism, civil unrest, natural disasters, infectious disease and changes in international, national or local governmental or economic conditions; • business disruptions arising from public health crises and outbreaks of communicable diseases; • the willingness of U.S. or international lenders to make loans in certain countries and changes in the availability, cost and terms of secured and unsecured debt resulting from varying governmental economic policies; • the imposition of unique tax structures and changes in other tax rates and other operating expenses in particular countries, including the potential imposition of adverse or confiscatory taxes; • the potential imposition of restrictions on currency conversions or the transfer of funds; • general political and economic instability; and • our limited experience and expertise in foreign countries, particularly European countries, relative to our experience and expertise in the United States.
A sustained deterioration in general economic conditions in the markets in which we operate, supply chain disruptions, geopolitical conflicts, political uncertainty, inflationary pressure, elevated interest rates or interest rate fluctuations such as those that occurred recently, may adversely affect our financial performance by reducing the number or active devices, active customers and total number of transactions using our payment solutions.
A sustained deterioration in general economic conditions in the markets in which we operate, supply chain disruptions, geopolitical conflicts, political uncertainty, inflationary pressure, tariffs, elevated interest rates or interest rate fluctuations such as those that occurred recently, may adversely affect our financial performance by reducing the number or active devices, active customers and total number of transactions using our payment solutions.
As a result, our operations and international expansion efforts could be impacted by economic, political and other conditions resulting from the current conflict between Russia and Ukraine and the conflict between Israel and Hamas, which could, among other things, lead to a reduction in consumer, government or corporate spending, international sanctions, embargoes, heightened inflation, volatility in global financial markets, increased cyber disruptions or attacks, higher supply chain costs and increased tensions between the United States and countries in which we operate, which could result in charges related to the recoverability of assets, including financial assets, long-lived assets and goodwill and other losses, and could adversely affect our financial position and results of operations.
As a result, our operations and international expansion efforts could be impacted by economic, political and other conditions resulting from the current conflict between Russia and Ukraine and the conflicts between Israel and Hamas and Israel and Iran, which could, among other things, lead to a reduction in consumer, government or corporate spending, international sanctions, embargoes, heightened inflation, volatility in global financial markets, increased cyber disruptions or attacks, higher supply chain costs and increased tensions between the United States and countries in which we operate, which could result in charges related to the recoverability of assets, including financial assets, long-lived assets and goodwill and other losses, and could adversely affect our financial position and results of operations.
In addition, climate-related events, including extreme weather events and natural disasters and their effect on critical infrastructure in the U.S. or internationally, could have similar adverse effects on our customers and our operations. Impacts of widespread inflation could negatively affect our industry.
In addition, climate-related events, including extreme weather events and natural disasters and their effect on critical infrastructure in the U.S. or internationally, could have similar adverse effects on our customers and our operations. Impacts of widespread inflation and tariffs could negatively affect our industry.
Additionally, if we incur losses in the future, the price of our common stock can be expected to fall. If we are not able to implement successful enhancements and new features for our products and services, our business could be materially and adversely affected.
Additionally, if we incur losses in the future, the price of our common stock can be expected to fall. 17 If we are not able to implement successful enhancements and new features for our products and services, our business could be materially and adversely affected.
Failure to comply with the foregoing financial covenants, if not cured or waived, will result in an event of default that could trigger acceleration of our indebtedness, which would require us to repay all amounts owed under the JPMorgan Credit Facility and could have a material adverse impact on our business, liquidity position and financial position.
Failure to comply with the foregoing financial covenants, if not cured or waived, will result in an event of default that could trigger acceleration of our indebtedness, which would require us to repay all amounts owed under the 2025 Credit Facility and could have a material adverse impact on our business, liquidity position and financial position.
Additionally, instead of saving money, we could in fact incur significant additional costs because of inefficient engineering services and poor work product, which could harm our business, financial results, reputation, and brand. 16 The loss of one or more of our key customers could significantly reduce our revenues, results of operations, and reduce net income.
Additionally, instead of saving money, we could in fact incur significant additional costs because of inefficient engineering services and poor work product, which could harm our business, financial results, reputation, and brand. 18 The loss of one or more of our key customers could significantly reduce our revenues, results of operations, and reduce net income.
Geopolitical conflicts, including the conflict between Russia and Ukraine and the conflict between Israel and Hamas, may adversely affect our business and results of operations.
Geopolitical conflicts, including the conflict between Russia and Ukraine and the conflicts between Israel and Hamas and Israel and Iran, may adversely affect our business and results of operations.
Item 1A. Risk Factors. The risks and uncertainties describe below are not the only ones we face. There may be other unknown or unpredictable economic, business, competitive, regulatory or other factors that could have material adverse effects on our future results.
Item 1A. Risk Factors. The risks and uncertainties described below are not the only ones we face. There may be other unknown or unpredictable economic, business, competitive, regulatory or other factors that could have material adverse effects on our future results.
Our own costs, including labor, hardware, services, technology providers, and other variable expenses could be impacted by severe, widespread or continuing inflation. Our customer base includes many small businesses, some of which operate on tight margins. Our customers may not successfully navigate a rising cost environment, causing collection issues or bankruptcies.
Our own costs, including labor, hardware, services, technology providers, and other variable expenses could be impacted by severe, widespread or continuing inflation and the levying of tariffs. Our customer base includes many small businesses, some of which operate on tight margins. Our customers may not successfully navigate a rising cost environment, causing collection issues or bankruptcies.
Substantially all of our customers may terminate their services with us for any or no reason by providing us with thirty days' advance notice, subject to, in some instances, early termination fees. Accordingly, consistent demand for and satisfaction with our products by our customers is critical to our financial condition and future success.
Substantially all of our customers may terminate their services with us for any or no reason by providing us with thirty days' advance notice, subject to early termination fees. Accordingly, consistent demand for and satisfaction with our products by our customers is critical to our financial condition and future success.
We cannot be certain that our future operating results will be sufficient to ensure compliance with the financial covenants in the JPMorgan Credit Facility or to remedy any defaults.
We cannot be certain that our future operating results will be sufficient to ensure compliance with the financial covenants in the 2025 Credit Facility or to remedy any defaults.
Our ability to execute our business plan is dependent, in part, on our ability to obtain patent protection for our proprietary products, maintain trade secret protection and operate without infringing the proprietary rights of others. As of June 30, 2024, the United States Government and other countries have granted us 140 patents, of which 49 are still in force.
Our ability to execute our business plan is dependent, in part, on our ability to obtain patent protection for our proprietary products, maintain trade secret protection and operate without infringing the proprietary rights of others. As of June 30, 2025, the United States Government and other countries have granted us 143 patents, of which 49 are still in force.
As a result, we have been and may continue to be exposed to substantial uninsured liabilities, including pursuant to our indemnification obligations, which could materially adversely affect our business, prospects, results of operations and financial condition.
As a result, we may be exposed to substantial uninsured liabilities, including pursuant to our indemnification obligations, which could materially adversely affect our business, prospects, results of operations and financial condition.
Our efforts to expand into international markets may not be successful; our products and services may not gain traction in new markets; and managing international operations may be challenging or may fail. As we seek to expand into international markets, we may not be successful, or our plans may be delayed. We only recently began managing international operations.
Our efforts to expand into international markets may not be successful; our products and services may not gain traction in new markets; and managing international operations may be challenging or may fail. As we seek to expand into international markets, we may not be successful, or our plans may be delayed.
We have worked, and expect to work in the future, with companies located in jurisdictions outside of the U.S., including, but not limited to Sweden, Romania, Columbia, and India.
We have worked, and expect to work in the future, with companies located in jurisdictions outside of the U.S., including, but not limited to Sweden, Romania, Columbia, Russia, Ukraine, India and Bangladesh.
Customer concentrations for the years ended June 30, 2024, 2023 and 2022 were as follows: For the year ended June 30, Single customer 2024 2023 2022 Total revenue 9% 12 % 14 % The loss of such customers could materially adversely affect our revenues.
Customer concentrations for the years ended June 30, 2025, 2024 and 2023 were as follows: For the year ended June 30, Single customer 2025 2024 2023 Total revenue 10 % 9 % 12 % The loss of such customers could materially adversely affect our revenues.
If any of the foregoing risks were to materialize, they could materially and adversely affect us. We and certain of our former officers and directors could be subject to future claims and lawsuits, which could require significant additional management time and attention, result in significant additional legal expenses or result in government enforcement actions.
If any of the foregoing risks were to materialize, they could materially and adversely affect us. We could be subject to claims and lawsuits, which could require significant additional management time and attention, result in significant additional legal expenses or result in government enforcement actions.
Upon our liquidation, the holders of our preferred stock are entitled to receive a liquidation preference prior to any distribution to the holders of common stock which, as of June 30, 2024 was approximately $22.7 million, inclusive of accrued dividends.
Upon our liquidation, the holders of our preferred stock are entitled to receive a liquidation preference prior to any distribution to the holders of common stock which, as of June 30, 2025 was approximately $23.3 million, inclusive of accrued dividends.
The JPMorgan Credit Facility has a four-year maturity and includes customary representations, warranties and covenants, and acceleration, indemnity and events of default provisions, including, among other things, two financial covenants. One financial covenant requires us to maintain, at all times, a total leverage ratio of not more than 3.00 to 1.00 on the last day of any fiscal quarter.
The 2025 Credit Facility has a five-year maturity and includes customary representations, warranties and covenants, and acceleration, indemnity and events of default provisions, including, among other things, two financial covenants. The first financial covenant requires the Company to maintain a total leverage ratio of not more than 3.50 to 1.00 on the last day of any fiscal quarter.
Further, due to the complexity of the work required to make needed improvements within the Company, it may be difficult for us to retain existing senior management and new hires, sales personnel, and development and engineering personnel critical to our ability to execute our business plan, which could result in harm to key customer relationships, loss of key information, expertise or know-how and unanticipated recruitment and training costs.
Further, due to the complexity of the work required to make needed improvements within the Company, it may be difficult for us to retain existing senior management and new hires, sales personnel, and development and engineering personnel critical to our ability to execute our business plan, which could result in harm to key customer relationships, loss of key information, expertise or know-how and unanticipated recruitment and training costs. 20 We may experience a loss of productivity due to the departure of key personnel and the associated loss of institutional knowledge, or while new personnel integrate into our business and transition into their respective roles.
We may identify additional material weaknesses or significant deficiencies in our internal controls in the future. If any such control deficiencies occur in the future, we may not detect errors on a timely basis and our financial statements could be materially misstated.
If any such control deficiencies occur in the future, we may not detect errors on a timely basis and our financial statements could be materially misstated.
Upon certain fundamental transactions involving the Company, such as a merger or sale of substantially all of our assets, we may be required to distribute the liquidation preference then due to the holders of our Series A Preferred Stock which would reduce the amount of the distributions otherwise to be made to the holders of our common stock in connection with such transactions.
Upon certain fundamental transactions involving the Company, such as a merger or sale of substantially all of our assets, we may be required to distribute the liquidation preference then due to the holders of our Series A Preferred Stock which would reduce the amount of the distributions otherwise to be made to the holders of our common stock in connection with such transactions. 25 Our articles of incorporation provide that upon a merger or sale of substantially all of our assets or upon the disposition of more than 50% of our voting power, the transaction will be treated as a liquidation if approved by the holders at least 50% of the preferred stock.
Section 404 of the Sarbanes-Oxley Act requires us to evaluate the effectiveness of our internal control over financial reporting as of the end of each fiscal year and to include a management report assessing the effectiveness of our internal control over financial reporting in our An nual Report on Form 10-K.
Section 404 of the Sarbanes-Oxley Act requires us to evaluate the effectiveness of our internal control over financial reporting as of the end of each fiscal year and to include a management report assessing the effectiveness of our internal control over financial reporting in our An nual Report on Form 10-K. 24 We have identified material weaknesses in our internal controls in the past, including as disclosed in our Annual Report on Form 10-K for the year ended June 30, 2023.
We are party to an amended and restated credit agreement with JPMorgan Chase Bank, N.A. which provides for a $15 million secured revolving credit facility (as amended, the “Amended Revolving Facility”) and a $25 million secured term facility (as amended, the “Amended Secured Term Facility” and together with the Amended Revolving Facility, the “JPMorgan Credit Facility”).
We are party to an amended and restated credit agreement with JPMorgan Chase Bank, N.A. and Capital One, N.A. which provides for a $30 million secured revolving credit facility (as amended, the “2025 Revolving Facility”) and a $40 million secured term facility (as amended, the “2025 Secured Term Facility”) and a $30 million secured delayed draw term loan facility (the "Delayed Draw Term Loan Facility", and together with the 2025 Revolving Facility and 2025 Secured Term Facility, the “2025 Credit Facility”).
Despite recent profitability, there can be no assurance that we will continue to be profitable in the future. Accordingly, we may be required to use our cash and cash equivalents on hand and may raise capital to meet cash 15 flow requirements including the issuance of common stock or debt financing.
Accordingly, we may be required to use our cash and cash equivalents on hand and may raise capital to meet cash flow requirements including the issuance of common stock or debt financing.
To the extent this occurs, we could be subject to additional technical, contractual or other requirements as a condition of our continuing to conduct our payment processing business. These requirements could cause us to incur additional costs, which could be significant, or to lose revenues to the extent we do not comply with these requirements.
To the extent this occurs, we could be subject to additional technical, contractual or other requirements as a condition of our continuing to conduct our payment processing business.
To the extent the Russia-Ukraine conflict or the Israel-Hamas conflict adversely affects our business, it may also have the effect of heightening many other risks disclosed in this Annual Report, any of which could have a material adverse effect on our business and results of operations.
To the extent the Russia-Ukraine conflict or the Israel-Hamas and Israel-Iran conflicts adversely affects our business, it may also have the effect of heightening many other risks disclosed in this Annual Report, any of which could have a material adverse effect on our business and results of operations. 19 Increased scrutiny from shareholders, customers and other stakeholders regarding our environmental, social, and governance, or sustainability responsibilities, could adversely impact our liquidity, results of operations, reputation, and stock price.
We may 19 not realize the anticipated benefits from our acquisitions. We could reduce the cash that would otherwise be available to fund operations or other purposes, or we could incur debt, potentially on unfavorable terms.
In addition, we may encounter unanticipated costs, operational challenges, or potential disruption of our business and diversion of management’s attention from our core business. We may not realize the anticipated benefits from our acquisitions. We could reduce the cash that would otherwise be available to fund operations or other purposes, or we could incur debt, potentially on unfavorable terms.
Government regulators, investors, customers and the general public are increasingly focused on ESG practices and disclosures, and views about ESG are diverse and rapidly changing. These shifts in investing priorities 17 may result in adverse effects on the trading price of our common stock if investors determine that the Company has not made sufficient progress on ESG matters.
These shifts in investing priorities may result in adverse effects on the trading price of our common stock if investors determine that the Company has not made sufficient progress on ESG matters.
Should the financing that we require to sustain our working capital needs be unavailable or prohibitively expensive when we require it, the consequences could have a material adverse effect on our business, operating results, financial condition and future prospects. 20 Failure to comply with any of the financial covenants under the Company’s debt facilities could result in an event of default which may accelerate our outstanding indebtedness or other obligations and have a material adverse impact on our business, liquidity position and financial position.
Failure to comply with any of the financial covenants under the Company’s debt facilities could result in an event of default which may accelerate our outstanding indebtedness or other obligations and have a material adverse impact on our business, liquidity position and financial position.
We may be unable to negotiate favorable terms in a timely manner or at all. Negotiation and integration of these types of potential business combinations could divert management’s time and resources. In addition, we may encounter unanticipated costs, operational challenges, or potential disruption of our business and diversion of management’s attention from our core business.
We could acquire additional products, technologies, or businesses to complement or expand our existing business. We may be unable to negotiate favorable terms in a timely manner or at all. Negotiation and integration of these types of potential business combinations could divert management’s time and resources.
We are subject to additional risks with respect to our current and potential international operations. We are subject to laws, regulations and business practices of the foreign jurisdictions in which we operate. These laws, regulations and business practices expose us to risks that are different than or in addition to those commonly found in the United States.
These laws, regulations and business practices expose us to risks that are different than or in addition to those commonly found in the United States.
We are exposed to general economic conditions that affect consumer confidence, spending, and discretionary income and changes in consumer purchasing habits.
The global payments technology industry depends heavily on the overall level of consumer, business and government spending. We are exposed to general economic conditions that affect consumer confidence, spending, and discretionary income and changes in consumer purchasing habits.
We cannot predict what losses we may incur in these matters, and contingencies related to our obligations under the federal and state securities laws, or in other legal proceedings or governmental investigations or proceedings related to these matters. To date, we have incurred significant costs in connection with litigation, investigations and with the special litigation committee proceedings.
Litigation, investigation or other actions that may be filed or initiated against us may be time consuming and expensive. We cannot predict what losses we may incur in these matters, and contingencies related to our obligations under the federal and state securities laws, or in other legal proceedings or governmental investigations or proceedings related to these matters.
Our future success also depends on our ability to attract and motivate highly skilled technical, managerial, sales, marketing and customer service personnel, including members of our management team. 18 The termination of our relationships with certain third-party suppliers upon whom we rely for services that are critical to our products could adversely affect our business and delay achievement of our business plan.
The termination of our relationships with certain third-party suppliers upon whom we rely for services that are critical to our products could adversely affect our business and delay achievement of our business plan.
We have identified material weaknesses in our internal controls in the past, including as disclosed in our Annual Report on Form 10-K for the year ended June 30, 2023. We have also previously restated certain of our consolidated financial statements (most recently in February 2020 for the fiscal period ended September 20, 2019).
We have also previously restated certain of our consolidated financial statements (most recently in February 2020 for the fiscal period ended September 20, 2019). We may identify additional material weaknesses or significant deficiencies in our internal controls in the future.
The other financial covenant is conditional on a material acquisition occurring: if a material acquisition occurs, we are required to maintain a total leverage ratio not greater than 4.00 to 1.00 for the next four fiscal quarters following the material acquisition. We were in compliance with its financial covenants as of June 30, 2024.
However, if a material acquisition occurs, the Company is required to maintain a total leverage ratio not greater than 4.00 to 1.00 on the last day of the fiscal quarter for the next four fiscal quarters following the material acquisition.
We had net cash provided by (used in) operating activities of $27.7 million, $14.2 million, and $(8.7) million for fiscal years ended 2024, 2023, and 2022, respectively. We may need additional funds to continue these operations. We may also need additional capital to respond to unusual or unanticipated non-operational events.
At June 30, 2025, we had a net working capital surplus of $70.5 million and cash and cash equivalents of $51.1 million. We had net cash provided by operating activities of $20.3 million, $27.7 million, and $14.2 million for fiscal years ended 2025, 2024, and 2023, respectively. We may need additional funds to continue these operations.
Further, our insurance may not cover all claims that have been or may be brought against us, and insurance coverage may not continue to be available to us at a reasonable cost.
Any legal proceedings, if decided adversely to us, could result in significant monetary damages, penalties and reputational harm, and will likely involve significant defense and other costs. Further, our insurance may not cover all claims that have been or may be brought against us, and insurance coverage may not continue to be available to us at a reasonable cost.
We may not fully realize the benefits of acquisitions, it may take longer than we anticipate for us to achieve those benefits, they may be difficult to integrate, may disrupt our business, or divert management attention and may adversely affect our financial condition. We could acquire additional products, technologies, or businesses to complement or expand our existing business.
Notwithstanding our programs and policies for managing credit risk, it is possible that a default on such obligations by one or more of our customers could have a material adverse effect on our business. 21 We may not fully realize the benefits of acquisitions, it may take longer than we anticipate for us to achieve those benefits, they may be difficult to integrate, may disrupt our business, or divert management attention and may adversely affect our financial condition.
We experienced losses from inception through June 30, 2012, and from fiscal year 2015 through fiscal year 2022. For fiscal years 2024 and 2023, we recognized net income of $12.0 million and $0.6 million, respectively. For fiscal year 2022, we incurred a net loss of $1.7 million.
We experienced losses from inception through June 30, 2012, and from fiscal year 2015 through fiscal year 2022. For fiscal years 2025, 2024 and 2023, we recognized net income of $64.5 million, $12.0 million and $0.6 million, respectively. Despite recent profitability, there can be no assurance that we will continue to be profitable in the future.
In addition, in the event of any event of default and related acceleration, we may not have or be able to obtain sufficient funds to make the accelerated payments required under the JPMorgan Credit Facility. Legal, regulatory, and compliance risks We are subject to laws and regulations that affect the products, services and markets in which we operate.
In addition, in the event of any event of default and related acceleration, we may not have or be able to obtain sufficient funds to make the accelerated payments required under the 2025 Credit Facility. Upon the consummation of the Merger, our 2025 Credit Facility will be paid off in full.
For information regarding the 2019 Investigation. 22 Risks related to our common stock Director and officer liability is limited and shareholders may have limited rights to recover against directors for breach of fiduciary duty.
In addition, we could become subject to investigations, litigation or disputes with stockholders, which could have an adverse impact on our business. Risks related to our common stock Director and officer liability is limited and shareholders may have limited rights to recover against directors for breach of fiduciary duty.
Patent and proprietary rights litigation entails substantial legal and other costs and diverts Company resources as well as the attention of our management. There can be no assurance we will have the necessary financial resources to appropriately defend or prosecute our intellectual property rights in connection with any such litigation.
Patent and proprietary rights litigation entails substantial legal and other costs and diverts Company resources as well as the attention of our management.
We may require additional financing or find it necessary to raise capital to sustain our operations and without it we may not be able to achieve our business plan. At June 30, 2024, we had a net working capital surplus of $51.9 million and cash and cash equivalents of $58.9 million.
There can be no assurance we will have the necessary financial resources to appropriately defend or prosecute our intellectual property rights in connection with any such litigation. 22 We may require additional financing or find it necessary to raise capital to sustain our operations and without it we may not be able to achieve our business plan.
Removed
Increased scrutiny from shareholders, customers and other stakeholders regarding our environmental, social, and governance, or sustainability responsibilities, could adversely impact our liquidity, results of operations, reputation, and stock price. Shareholders, customers and other stakeholders have begun to consider how corporations are addressing environmental, social and governance (“ESG”) issues.
Added
Risks related to our pending Merger with 365 Retail Markets, LLC The pendency of the Merger may result in disruptions to our business.
Removed
We may experience a loss of productivity due to the departure of key personnel and the associated loss of institutional knowledge, or while new personnel integrate into our business and transition into their respective roles.
Added
On June 15, 2025, we entered into the Merger Agreement with 365 Retail Markets, Holdco, Holdco II and Merger Sub, pursuant to which, subject to the terms and conditions thereof, we will be acquired by 365 Retail Markets in an all-cash transaction.
Removed
Notwithstanding our programs and policies for managing credit risk, it is possible that a default on such obligations by one or more of our customers could have a material adverse effect on our business.
Added
The Merger Agreement generally requires us to operate our business in the ordinary course pending consummation of the Merger and prohibits us, without 365 Retail Markets’ consent, from taking certain specified actions until the Merger has been consummated.
Removed
We and certain of our former officers and directors have been subject to litigation, government investigations or proceedings, including the 2019 Investigation (refer to Note 18 – Commitments and Contingencies to the consolidated financial statements in Part II, Item 8 of this Annual report).
Added
These prohibitions may affect our ability to execute our business strategies and attain financial and other goals and may impact our financial condition, results of operations and cash flows.
Removed
Future litigation, investigation or other actions that may be filed or initiated against us or our former officers or directors may be time consuming and expensive.
Added
Further, in connection with the Merger, our current and prospective employees may experience uncertainty about their future roles with us following the Merger, which may adversely affect our ability to attract and retain key personnel.
Removed
Any legal proceedings, if decided adversely to us, could result in significant monetary damages, penalties and reputational harm, and will likely involve significant defense and other costs. We have entered into indemnification agreements with certain of our former directors and officers, and our bylaws require us to indemnify each of our directors and officers.
Added
Key employees may depart because of issues relating to the uncertainty and difficulty of integration or a desire not to remain with us following the Merger, and may depart prior to the consummation of the Merger.
Removed
In addition, we could become subject to investigations, such as the 2019 Investigation, litigation or disputes with stockholders, which could have an adverse impact on our business.
Added
Accordingly, no assurance can be given that we will be able to attract and retain key employees to the same extent that we have been able to in the past. The Merger could cause disruptions to our business or business relationships, which could have an adverse impact on our results of operations.
Removed
Our articles of incorporation provide that upon a merger or sale of substantially all of our assets or upon the disposition of more than 50% of our voting power, the transaction will be treated as a liquidation if approved by the holders at least 50% of the preferred stock.
Added
Parties with which we have business relationships may experience uncertainty as to the future of such relationships and may delay or defer certain business decisions, seek alternative relationships with third parties or seek to alter their present business relationships with us. Parties with whom we otherwise may have sought to establish business relationships may seek alternative relationships with third parties.
Added
The Merger may place a significant burden on management and internal resources. It may also divert management’s time and attention from the day-to-day operation of our businesses and the execution of our other strategic initiatives. This could adversely affect our financial results.
Added
In addition, we have incurred and will continue to incur other significant costs, expenses and fees for professional services and other transaction costs in connection with the Merger, and many of these fees and costs are payable regardless of whether or not such transaction is consummated.
Added
Any of the foregoing could materially and adversely affect our business, our financial condition and our results of operations and prospects.
Added
The Merger may not be consummated within the intended timeframe, or at all, and the failure to consummate the Merger will adversely affect the market price of our common stock and could adversely affect our business, results of operations and financial condition. There can be no assurance that the Merger will be consummated within the intended timeframe, or at all.
Added
The Merger Agreement contains a number of conditions that must be satisfied or waived prior to the completion of the Merger, including the expiration or termination of any applicable waiting periods under the Hart-Scott-Rodino ("HSR") Antitrust Improvements Act of 1976, as amended (the “HSR Act”).
Added
Subject to the satisfaction or, to the extent permitted by law, waiver of requisite closing conditions, including the expiration or termination of the requisite statutory waiting period under the HSR Act described below, the Company currently expects the Merger to be completed in the second half of calendar year 2025.
Added
However, there can be no assurance that the remaining closing conditions will be satisfied (or waived, if applicable), and if all closing conditions are satisfied (or waived, if applicable), we can provide no assurance that the Merger will be consummated promptly or at all.
Added
There may be a significant or longer than expected time period between the approval of the Merger by our shareholders o n September 4, 2025 and the closing of the Merger, due to the timing of required regulatory approvals, satisfaction of other closing conditions, or other factors, including those described herein. 15 For instance, at any time before the effective time of the Merger, notwithstanding the expiration or termination of the waiting period under the HSR Act, the Federal Trade Commission, the Antitrust Division of the Department of Justice, or any state could take action under antitrust laws as it deems necessary or desirable in the public interest with respect to the Merger, including seeking to enjoin the completion of the Merger, to rescind the Merger, or to conditionally approve the Merger upon the divestiture of assets, or to impose restrictions on the our operations or the operations of 365 Retail Markets following the completion of the Merger.
Added
Private parties may also seek to take legal action under the antitrust laws under certain circumstances. There can be no assurance that the Merger will not be challenged on antitrust grounds or, if such a challenge is made, that the challenge will not be successful.
Added
The Merger is complex in nature, and unanticipated developments, including among other things, changes in law, the macroeconomic environment, market conditions, regulatory or geopolitical conditions, may affect our, or 365 Retail Market’s ability to close the Merger as currently expected and within the anticipated timeframe.
Added
If the Merger is not consummated within the intended timeframe or at all, we may not realize some or all of the expected benefits of the Merger or may realize them on a different timeline than expected. The price of our common stock could significantly decline if the Merger is not consummated within the intended timeframe or at all.
Added
In addition, some costs related to the Merger must be paid whether or not the Merger is consummated, as we have already incurred, and will continue to incur, significant costs, expenses and fees for professional services and other transaction costs in connection with the Merger.
Added
If the Merger is not consummated within the intended timeframe or at all, we may also experience negative reactions from our investors, customers, partners, suppliers, and employees. Along with transaction costs and fees, the Merger has required and will continue to require the attention and resources of our management team.
Added
If the Merger is not consummated within the intended timeframe or at all, our management team’s attention and resources will have been diverted from other uses with little to no additional benefit to the Company.
Added
We have in the past, and may again in future, become subject to lawsuits relating to the Merger, which could adversely affect our business, financial condition and operating results. We and/or our respective directors and officers have in the past, and may again in the future, become subject to lawsuits relating to the Merger.
Added
Such litigation is very common in connection with acquisitions of public companies, regardless of the merits of the underlying acquisition.
Added
For instance, as previously disclosed, following the filing of our Preliminary Proxy Statement on Schedule 14A with the SEC on July 11, 2025 and the Definitive Proxy Statement (the “Proxy Statements”) in connection with the Merger, we received certain complaints and demand letters on behalf of purported Cantaloupe shareholders alleging deficiencies regarding the disclosures contained in the Proxy Statements.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur CISO has industry recognized certifications including Certified Information Systems Security Professional (CISSP), Certified Information Security Manager (CISM), Payment Card Industry Professional (PCI ISA & PCIP). He worked in various information security roles at other large public traded companies.
Biggest changeOur CISO has industry recognized certifications including Certified Information Systems Security Professional (CISSP), Certified Information Security Manager (CISM), Payment Card Industry Professional (PCI ISA & PCIP). Our CISO has worked in various information security roles at other large publicly traded companies.
Oversight Our Information Security Program is overseen by our Chief Information Security Officer (“CISO”), who reports to our Chief Technology Officer (“CTO”). Our CISO oversees the third-party consultants who help assess our security controls and penetration testing previously described. The CTO provides oversight, leadership and direction for data risks, technology risks and information security.
Oversight Our Information Security Program is overseen by our Chief Information Security Officer (“CISO”), who reports to our Chief Technology Officer (“CTO”). Our CISO oversees the third-party consultants who help assess our security controls and penetration testing previously described. The CTO provides oversight, leadership and direction for data risks, technology risks and information security risks.
We have an Incident Management Policy ("IMP") and Incident Response Plan ("IRP") which helps enable us to quickly detect, respond to, and recover from third-party malicious attacks and potential security incidents. This plan includes formal steps to review incidents and implement improvements, including steps to involve the CISO, CIO and CTO as appropriate.
We have an Incident Management Policy ("IMP") and Incident Response Plan ("IRP") which helps enable us to quickly detect, respond to, and recover from third-party malicious attacks and potential security incidents. This plan includes formal steps to review incidents and implement improvements, including steps to involve the CISO and CTO as appropriate.
Our CISO leads the Cybersecurity organization and has the overall responsibility of implementing its strategy and objectives to build a strong cyber engineering function. Our CISO has over 20 years of information technology experience with specialization in information security and risk management.
Our CISO leads the Cybersecurity organization and has the overall responsibility of implementing its strategy and objectives to build a strong cyber engineering function. 26 Our CISO has over 20 years of information technology experience with specialization in information security and risk management.
Additionally, we leverage third-party firms to conduct routine external and internal penetration testing to emulate the common tactics and techniques of cyber threat actors and have processes to address identified vulnerabilities, although it may take time to mitigate or manage such vulnerabilities. Results of this testing is included in the Company's SOC report.
Additionally, we leverage third-party firms to conduct routine external and internal penetration testing to emulate the common tactics and techniques of cyber threat actors and have processes to address identified vulnerabilities, although it may take time to mitigate or manage such vulnerabilities. The results of this testing are included in the Company's SOC report.
The CISO and CTO report to the Board of Directors who have ultimate responsibility in overseeing enterprise risks, including cybersecurity threats. 24
The CISO and CTO report to the Board of Directors who have ultimate responsibility in overseeing enterprise risks, including cybersecurity threats.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeLocation Approximate Monthly Base Rent Lease Expiration Approximate Size Atlanta, Georgia $38,000 - $44,000 July 2029 15,300 sq. ft. Malvern, Pennsylvania $65,000 - $85,000 March 2035 27,000 sq. ft. Denver, Colorado (1) $45,000 - $53,000 December 2026 16,700 sq. ft. River Falls, Wisconsin $35,000 November 2026 36,100 sq. ft. Metairie, Louisiana (1) $15,000 - $16,000 July 2024 7,800 sq. ft.
Biggest changeThe Company also leases other small facilities on a short term basis which are not included in the table below. Location Approximate Monthly Base Rent Lease Expiration Approximate Size Atlanta, Georgia $38,000 - $44,000 July 2029 15,300 sq. ft. Malvern, Pennsylvania $65,000 - $85,000 March 2035 27,000 sq. ft. Denver, Colorado (1) $45,000 - $53,000 December 2026 16,700 sq. ft.
Removed
Seattle, Washington $6,000 December 2024 2,400 sq. ft. Birmingham, United Kingdom $4,500 December 2026 6,800 sq. ft. Dhaka, Bangladesh $3,740 June 2025 4,400 sq. ft. (1) These office space locations are no longer utilized by the Company and have been sub-leased.
Added
River Falls, Wisconsin $35,000 November 2027 36,100 sq. ft. (1) This office space location is no longer utilized by the Company and has been sub-leased.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeCOMPARISON OF 5‑YEAR CUMULATIVE TOTAL RETURN Among Cantaloupe, Inc., The US Small-Cap Russell 2000® Index, and The S&P 500 Information Technology Index 26 Total Return For: Jun-19 Jun-20 Jun-21 Jun-22 Jun-23 Jun-24 Cantaloupe, Inc. $ 100 $ 94 $ 160 $ 75 $ 107 $ 89 US Small-Cap Russell 2000® Index $ 100 $ 92 $ 147 $ 109 $ 121 $ 131 S&P 500 Information Technology Index $ 100 $ 134 $ 189 $ 162 $ 225 $ 318 The information in the performance graph is not deemed to be “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A or 14C under the Securities Exchange Act of 1934, as amended, or to the liabilities of Section 18 of the Securities Exchange Act of 1934, as amended, and will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that we specifically incorporate it by reference into such a filing.
Biggest changeCOMPARISON OF 5‑YEAR CUMULATIVE TOTAL RETURN Among Cantaloupe, Inc., The US Small-Cap Russell 2000® Index, and The S&P 500 Information Technology Index 28 Total Return For: Jun-20 Jun-21 Jun-22 Jun-23 Jun-24 Jun-25 Cantaloupe, Inc. $ 100 $ 169 $ 80 $ 114 $ 94 $ 157 US Small-Cap Russell 2000® Index $ 100 $ 160 $ 119 $ 131 $ 142 $ 151 S&P 500 Information Technology Index $ 100 $ 141 $ 121 $ 168 $ 238 $ 271 The information in the performance graph is not deemed to be “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A or 14C under the Exchange Act of 1934, as amended, or to the liabilities of Section 18 of the Securities Exchange Act of 1934, as amended, and will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that we specifically incorporate it by reference into such a filing.
The graph assumes a $100 investment on June 30, 2018 in our common stock and in the Small-Cap Russell 2000® Index and the S&P 500 Information Technology Index, including reinvestment of dividends. The Company was added as a member of the US Small-Cap Russell 2000 ® Index in June 2021.
The graph assumes a $100 investment on June 30, 2020 in our common stock and in the Small-Cap Russell 2000® Index and the S&P 500 Information Technology Index, including reinvestment of dividends. The Company was added as a member of the US Small-Cap Russell 2000 ® Index in June 2021.
Through the date hereof, no cash dividends have been declared on the Company’s common stock or preferred stock. No dividend may be paid on the common stock until all accumulated and unpaid dividends on the preferred stock have been paid. As of June 30, 2024, accumulated unpaid preferred stock dividends amounted to approximately $18.9 million .
Through the date hereof, no cash dividends have been declared on the Company’s common stock or preferred stock. No dividend may be paid on the common stock until all accumulated and unpaid dividends on the preferred stock have been paid. As of June 30, 2025, accumulated unpaid preferred stock dividends amounted to approximately $19.4 million .
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Our common stock is traded on The NASDAQ Global Market under the symbol “CTLP”. As of September 6, 2024 , there were 485 h olders of record of our common stock an d 214 rec ord holders of the preferred stock.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Our common stock is traded on The NASDAQ Global Market under the symbol “CTLP”. As of September 2, 2025 , there were 436 h olders of record of our common stock an d 203 rec ord holders of the preferred stock.
The preferred stock is also entitled to a liquidation preference over the common stock. As of June 30, 2024, the liquidation preference was approximately $22.7 million, inclusive of the $18.9 million unpaid dividends .
The preferred stock is also entitled to a liquidation preference over the common stock. As of June 30, 2025, the liquidation preference was approximately $23.3 million, inclusive of the $19.4 million unpaid dividends .

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeAs of and for the years ended June 30, 2024 June 30, 2023 June 30, 2022 Devices: Active Devices (thousands) 1,223 1,168 1,137 Customers: Active Customers 31,466 28,584 23,991 Volumes: Total Number of Transactions (millions) 1,144 1,096 1,053 Total Dollar Volume of Transactions (millions) $ 3,038 $ 2,646 $ 2,287 Subscription and transaction fees - Trailing 12 months (thousands) $ 231,496 $ 200,223 $ 168,850 Average revenue per unit (ARPU) $ 193.64 $ 173.70 $ 151.35 RESULTS OF OPERATIONS Year Ended June 30, Change Percent Change ($ in thousands) 2024 2023 2024 v. 2023 Subscription and transaction fee revenue $ 231,497 $ 200,223 $ 31,274 15.6 % Cost of subscription and transaction fees (1) 131,400 119,715 11,685 9.8 % Amortization (2) 6,767 5,020 1,747 34.8 % Gross profit, subscription and transaction fees $ 93,330 $ 75,488 $ 17,842 23.6 % Equipment sales $ 37,099 43,418 (6,319) (14.6) % Cost of equipment sales 34,545 42,690 (8,145) (19.1) % Gross profit, equipment (3) $ 2,554 $ 728 $ 1,826 250.8 % Total gross profit $ 95,884 $ 76,216 $ 19,668 25.8 % Gross margin Subscription and transaction fees 40.3 % 37.7 % 2.6 % Equipment sales 6.9 % 1.7 % 5.2 % Total gross margin 35.7 % 31.3 % 4.4 % (1) Cost of subscription and transaction fees excludes amortization of certain technology assets, see (2) below.
Biggest changeAs of and for the years ended June 30, 2025 June 30, 2024 June 30, 2023 Devices: Active Devices (thousands) 1,280 1,223 1,168 Customers: Active Customers 34,896 31,466 28,584 Volumes: Total Number of Transactions (millions) 1,199 1,144 1,096 Total Dollar Volume of Transactions (millions) $ 3,444 $ 3,038 $ 2,646 Subscription and transaction fees - Trailing 12 months (thousands) $ 263,128 $ 231,496 $ 200,223 Average revenue per unit (ARPU) $ 210.26 $ 193.64 $ 173.70 RESULTS OF OPERATIONS Year Ended June 30, Change Percent Change ($ in thousands) 2025 2024 2025 v. 2024 Transaction fees $ 179,534 $ 156,166 $ 23,368 15.0 % Cost of transaction fees 134,615 123,295 11,320 9.2 % Gross profit, transaction (1) $ 44,919 $ 32,871 12,048 36.7 % Gross margin, transaction 25.0 % 21.0 % 4.0 % Subscription fees $ 83,594 $ 75,331 $ 8,263 11.0 % Cost of subscription fees 8,466 8,105 361 4.5 % Amortization (2) 11,683 6,767 4,916 72.6 % Gross profit, subscription fees $ 63,445 $ 60,459 2,986 4.9 % Gross margin, subscription 75.9 % 80.3 % (4.4) % Equipment sales $ 39,420 $ 37,099 $ 2,321 6.3 % Cost of equipment sales 35,643 34,545 1,098 3.2 % Gross profit, equipment (1) $ 3,777 $ 2,554 1,223 47.9 % Gross margin, equipment 9.6 % 6.9 % 2.7 % Total gross profit $ 112,141 $ 95,884 $ 16,257 17.0 % Total gross margin 37.1 % 35.7 % 1.4 % (1) The Company's internal-use software assets and developed technology assets are not associated with transaction fees and equipment revenue.
We believe the following macroeconomic conditions and specific industry trends and uncertainties are most likely to impact our financial results: • Our ability to meet rising demand from the increased adoption of cashier-less models via vending machines, self-service kiosks, and mobile ordering as consumer preferences for use of faster, simpler and more seamless digital purchase and payment experiences continues to grow; • Our ability to implement successful enhancements and new features for our products and services and to successfully target, acquire and integrate new businesses; • The broader implications of the macroeconomic environment, including a potentially sustained deterioration in general economic conditions in the markets in which we operate, including as a result of supply chain disruptions, geopolitical conflicts (including the conflicts between Russia and Ukraine and Israel and Hamas), political uncertainty, inflationary pressure, elevated interest rates or interest rate fluctuations such as those that occurred recently; and • Ongoing labor challenges and inflation drive increased utility of actionable operational business intelligence from new technologies like machine learning and AI to drive operational efficiencies and operational transparency through modern, cloud-based logistics and inventory management solutions.
We believe the following macroeconomic conditions and specific industry trends and uncertainties are most likely to impact our financial results: • Our ability to meet rising demand from the increased adoption of cashier-less models via vending machines, self-service kiosks, and mobile ordering as consumer preferences for use of faster, simpler and more seamless digital purchase and payment experiences continues to grow; • Our ability to implement successful enhancements and new features for our products and services and to successfully target, acquire and integrate new businesses; • The broader implications of the macroeconomic environment, including a potentially sustained deterioration in general economic conditions in the markets in which we operate, including as a result of supply chain disruptions, geopolitical conflicts (including the conflicts between Russia and Ukraine, Israel and Hamas, and Israel and Iran), political uncertainty, inflationary pressure, tariffs, elevated interest rates or interest rate fluctuations such as those that occurred recently; and • Ongoing labor challenges and inflation drive increased utility of actionable operational business intelligence from new technologies like machine learning and AI to drive operational efficiencies and operational transparency through modern, cloud-based logistics and inventory management solutions.
Adjusted EBITDA is widely used by investors and securities analysts to measure a company’s operating 33 performance without regard to items such as depreciation and amortization, interest expense, and interest income, which can vary substantially from company to company depending on their financing and capital structures and the method by which their assets were acquired.
Adjusted EBITDA is widely used by investors and securities analysts to measure a company’s operating performance without regard to items such as depreciation and amortization, interest expense, and interest income, which can vary substantially from company to company depending on their financing and capital structures and the method by which their assets were acquired.
See Note 6 - Leases to the consolidated financial statements for further information. 35 CRITICAL ACCOUNTING ESTIMATES Our consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”, "GAAP"), and they conform to general practices in our industry. The preparation of financial statements and related disclosures in conformity with U.S.
See Note 6 - Leases to the consolidated financial statements for further information. CRITICAL ACCOUNTING ESTIMATES Our consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”, "GAAP"), and they conform to general practices in our industry. The preparation of financial statements and related disclosures in conformity with U.S.
The Company allocates the acquisition purchase price to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values on the acquisition dates. The excess of total consideration over the fair 36 values of the assets acquired and the liabilities assumed is recorded as goodwill.
The Company allocates the acquisition purchase price to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values on the acquisition dates. The excess of total consideration over the fair values of the assets acquired and the liabilities assumed is recorded as goodwill.
Additionally, our equipment sales gross margins improved from the prior year primarily driven by the diversification of our equipment sales and higher margins on certain micro market equipment. Adjusted EBITDA We define Adjusted EBITDA as U.S.
Additionally, our equipment sales gross margins improved from the prior fiscal year primarily driven by the diversification of our equipment sales and higher margins on certain micro market equipment. Adjusted EBITDA We define Adjusted EBITDA as U.S.
To the extent we do not consider it more likely than not that a deferred tax asset will be recovered, a valuation allowance is established. As the Company has recently been profitable, significant judgement is involved in determining if and when the Company's valuation allowance could be released as well as the amount of the release (full or partial).
To the extent we do not consider it more likely than not that a deferred tax asset will be recovered, a valuation allowance is established. As the Company has recently been profitable, significant judgment is involved in determining if and when the Company's valuation allowance could be released as well as the amount of the release (full or partial).
The liability includes significant judgments and estimates that may change in the future, and the actual liability may be different from our current estimate.
The liability includes significant judgments and estimates that may change in the future, and the actual liability may be different from our current estimate. 40
The estimated liability is adjusted upon the payment of sales tax related to the accrual, the changes in state tax laws that may impact the accrual and the expiration of the statute of limitations for open years under review. Significant judgement is inherent in the methodology utilized to determine the historical sales tax reserve.
The estimated liability is adjusted upon the payment of sales tax related to the accrual, the changes in state tax laws that may impact the accrual and the expiration of the statute of limitations for open years under review. Significant judgment is inherent in the methodology utilized to determine the historical sales tax reserve.
Business.” Unless stated otherwise, the comparisons presented in this discussion and analysis refer to the year-over-year comparison of changes in our financial condition and results of operations as of and for the fiscal years ended June 30, 2024 and June 30, 2023.
Business.” Unless stated otherwise, the comparisons presented in this discussion and analysis refer to the year-over-year comparison of changes in our financial condition and results of operations as of and for the fiscal years ended June 30, 2025 and June 30, 2024.
Certain contracts require significant contract interpretation to determine appropriate accounting due to complex arrangements with nonstandard contract terms. In particular, the determination of whether the Company is principal (gross revenue) or agent (net revenue) in a transaction can require significant judgement.
Certain contracts require significant contract interpretation to determine appropriate accounting due to complex arrangements with nonstandard contract terms. In particular, the determination of whether the Company is principal (gross revenue) or agent (net revenue) in a transaction can require significant judgment.
A change in this judgement could result in a significant reduction in the Company's revenues, but no impact to the Company's net income. Certain contracts also require significant judgement related to the relative standalone selling prices and the allocation to equipment and subscription services.
A change in this judgment could result in a significant reduction in the Company's revenues, but no impact to the Company's net income. Certain contracts also require significant judgment related to the relative standalone selling prices and the allocation to equipment and subscription services.
Discussion of fiscal year 2023 items and the year-over year comparison of changes in our financial condition and results of operations as of and for the fiscal years ended June 30, 2023 and June 30, 2022 can be found in Part II, “Item 7.
Discussion of fiscal year 2024 items and the year-over year comparison of changes in our financial condition and results of operations as of and for the fiscal years ended June 30, 2024 and June 30, 2023 can be found in Part II, “Item 7.
Active Customers The Company defines Active Customers as all customers with at least one Active Device. 29 Total Number Of Transactions and Total Dollar Volume of Transactions Transactions are defined as electronic payment transactions that are processed by our technology-enabled solutions.
Active Customers The Company defines Active Customers as all customers with at least one Active Device. 32 Total Number of Transactions and Total Dollar Volume of Transactions Transactions are defined as electronic payment transactions that are processed by our technology-enabled solutions.
Significant judgements include whether a project qualifies for capitalization, whether costs incurred directly relate to a project, and the stage of the project's development. There have been no changes in the Company's capitalization judgements. Business Combinations.
Significant judgments include whether a project qualifies for capitalization, whether costs incurred directly relate to a project, and the stage of the project's development. There have been no changes in the Company's capitalization judgments. Business Combinations.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the fiscal year ended June 30, 2023, which was previously filed with the SEC on September 25, 2023. The following discussion contains forward-looking statements that involve risks and uncertainties.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the fiscal year ended June 30, 2024, which was previously filed with the SEC on September 10, 2024. The following discussion contains forward-looking statements that involve risks and uncertainties.
A change in these judgements could result in a significant change in the timing of the Company's revenue recognition. Capitalization of internal-use soft ware and cloud computing arrangements. We have significant expenditures associated with the technological maintenance and improvement of our network and technology offerings.
A change in these judgments could result in a significant change in the timing of the Company's revenue recognition. 39 Capitalization of internal-use soft ware and cloud computing arrangements. We have significant expenditures associated with the technological maintenance and improvement of our network and technology offerings.
MARKET CONDITIONS The self-service industry is highly competitive with service providers ranging from well-established enterprises to early-stage companies within the financial technology and software services industries. The markets for our products and services are characterized by evolving industry standards, aggressive pricing, continuous innovation, and changing consumer trends.
See Note 21 - Subsequent Events . MARKET CONDITIONS The self-service industry is highly competitive with service providers ranging from well-established enterprises to early-stage companies within the financial technology and software services industries. The markets for our products and services are characterized by evolving industry standards, aggressive pricing, continuous innovation, and changing consumer trends.
Committed to innovation, we aim to drive advancements in digital payments and business optimization, serving 31,466 customers in the U.S., U.K., EU countries, Australia, and Mexico. Our fiscal year ends June 30. We generate revenue in multiple ways.
Committed to innovation, we aim to drive advancements in digital payments and business optimization, serving 34,896 customers in the U.S., U.K., EU countries, Australia, and Mexico. Our fiscal year ends June 30. We generate revenue in multiple ways.
As of June 30, 2024, an interest rate of 9.0% was used to compute the amount of the contractual obligations for interest on the JPMorgan Credit Agreement. See Note 7 - Debt and Other Financing Arrangements to the consolidated financial statements for further information. (b) Operating lease obligations represent our undiscounted operating lease liabilities as of June 30, 2024.
As of June 30, 2025, an interest rate of 7.14% was used to compute the amount of the contractual obligations for interest on the JPMorgan Credit Agreement. See Note 7 - Debt and Other Financing Arrangements to the consolidated financial statements for further information. (b) Operating lease obligations represent our undiscounted operating lease liabilities as of June 30, 2025.
In April 2024, we agreed to a net settlement of approximately $1.5 million with a third-party insurance carrier related to the reimbursement of expenses associated with the 2019 Investigation. The settlement was recognized as a gain in our consolidated statement of operations for the year ended June 30, 2024.
Investigation, proxy solicitation and restatement expenses, net of insurance recoveries. In April 2024, we agreed to a net settlement of approximately $1.5 million with a third-party insurance carrier related to the reimbursement of expenses associated with the 2019 Investigation. The settlement was recognized as a gain in our consolidated statement of operations for the year ended June 30, 2024.
Total Adjusted Gross Margin (non-GAAP) was 38.2% for the year ended June 30, 2024, from 33.3% for the year ended June 30, 2023. The increase in Adjusted Gross Margin was primarily driven by an increase in our subscription fees revenue which is inherently a higher margin revenue stream.
Total Adjusted Gross Margin (non-GAAP) was 40.9% for the year ended June 30, 2025, from 38.2% for the year ended June 30, 2024. The increase in Adjusted Gross Margin was primarily driven by an increase in our subscription fees revenue which is inherently a higher margin revenue stream.
The increase in inventory was a result of the Company expansion plans in Mexico and the UK. The increase in accounts payable and accrued expenses as well as accounts receivable is primarily due to merchant accounts in processing at year end.
The increase in inventory was a result of the Company expansion plans in Mexico and the U.K. The decrease in accounts payable and accrued expenses as well as the decrease in accounts receivable is primarily due to the timing of merchant accounts in processing at year end compared to the prior fiscal year.
Federal and state net operating loss carryforwards are reserved with a full valuation allowance because, based on the available evidence, the Company believes it is more likely than not that we would not be able to utilize those deferred tax assets in the future.
Federal and state net operating loss carryforwards were reserved with a full valuation allowance for the years ended June 30, 2024 and 2023 because, based on the available evidence, the Company believed it is more likely than not that we would not be able to utilize those deferred tax assets in the future.
Integration and acquisition. For the fiscal year ended June 30, 2024, the Company incurred professional service fees of $1.2 million from accounting, legal, investing banking advisors and consulting services for the successful completion of the Cheq acquisition, as well as post-acquisition costs associated with the integration process.
This is offset by a $0.6 million decrease in the fair value of the contingent consideration. For the fiscal year ended June 30, 2024, the Company incurred professional service fees of $1.2 million from accounting, legal, investing banking advisors and consulting services for the successful completion of the Cheq acquisition, as well as post-acquisition costs associated with the integration process.
During the fiscal years ended June 30, 2024 and June 30, 2023, we derived approximately 86% of our revenue from subscription and transaction fees, and approximately 14% from equipment sales. Active Devices on our service include POS electronic payment devices, certified payment software, or the servicing of similar third-party installed POS terminals.
For the fiscal year ended June 30, 2025, we derived approximately 59% of our revenue from transaction fees, 28% from subscription fees, and approximately 13% from equipment sales. Active Devices on our service include POS electronic payment devices, certified payment software, or the servicing of similar third-party installed POS terminals.
GAAP net income to Adjusted EBITDA for the fiscal years ended June 30, 2024 and 2023: Year ended June 30, ($ in thousands) 2024 2023 Net income $ 11,993 $ 633 Less: interest income (1,969) (2,515) Plus: interest expense 2,934 2,326 Plus: income tax provision 985 181 Plus: depreciation expense included in cost of sales for rentals 1,634 1,189 Plus: depreciation and amortization expense in operating expenses 10,570 7,618 EBITDA 26,147 9,432 Plus: stock-based compensation (a) 5,109 4,737 Plus: investigation, proxy solicitation and restatement expenses, net of insurance recoveries (b) (1,522) (362) Plus: integration and acquisition expenses (c) 1,197 3,141 Plus: severance expenses (d) 53 273 Plus: remediation expenses (e) 2,976 573 Adjustments to EBITDA 7,813 8,362 Adjusted EBITDA $ 33,960 $ 17,794 (a) We have excluded stock-based compensation, as it does not reflect our cash-based operations.
GAAP net income to Adjusted EBITDA for the fiscal years ended June 30, 2025 and 2024: Year ended June 30, ($ in thousands) 2025 2024 Net income $ 64,533 $ 11,993 Less: interest income (1,561) (1,969) Plus: interest expense 2,769 2,934 Plus: income tax (benefit) provision (42,352) 985 Plus: depreciation expense included in cost of sales for rentals 1,923 1,634 Plus: depreciation and amortization expense in operating expenses 15,877 10,570 EBITDA 41,189 26,147 Plus: stock-based compensation (a) 4,008 5,109 Plus: investigation, proxy solicitation and restatement expenses, net of insurance recoveries (b) — (1,522) Plus: integration, acquisition, due diligence, and license application expenses (c) 1,018 1,197 Plus: auditor transition costs 525 — Plus: severance expenses (d) — 53 Plus: remediation expenses (e) — 2,976 Adjustments to EBITDA 5,551 7,813 Adjusted EBITDA $ 46,740 $ 33,960 (a) We have excluded stock-based compensation, as it does not reflect our cash-based operations.
Net cash provided by operating activities Net cash provided by operating activities was $27.7 million for the year ended June 30, 2024 compared to $14.2 million for the year ended June 30, 2023. We recognized $12.0 million in net income and incurred $23.6 million in non-cash operating charges, partially offset by $7.8 million cash utilized in working capital accounts.
Net cash provided by operating activities Net cash provided by operating activities was $20.3 million for the year ended June 30, 2025 compared to $27.7 million for the year ended June 30, 2024. We recognized $64.5 million in net income offset by $18.4 million in non-cash operating charges and $25.8 million cash utilized in working capital accounts.
We paid $3.7 million in cash for the Cheq acquisition and invested $14.9 million in capital expenditures as the Company focuses on investing in innovative technologies and products, and increasing rental devices enrolled in the Company's Cantaloupe One program.
We invested $17.0 million in capital expenditures as the Company focuses on investing in innovative technologies and products, and increasing rental devices enrolled in the Company's Cantaloupe One program compared to $14.9 million for the year ended June 30, 2024.
Our subscription fees increased approximately $7.7 million, or 11% for the year ended June 30, 2024 compared to the prior year which was attributed to a focus of management on growing our recurring subscription services to our customer base and a 5% increase in the Active Devices count compared to last year.
Our subscription fees increased approximately $8.3 million, or 11% for the year ended June 30, 2025 which is attributed to a continued focus of management to grow our recurring subscription services to our customer base and an increase in our active devices compared to last year as well as the acquisition of SB Software and Cheq.
If the actual amounts of taxable income differ from our estimates, the amount of our valuation allowance could be materially impacted. Sales tax reserve. The Company has recorded estimated liabilities for current and historical sales taxes, which are included in accrued expenses in the Consolidated Balance Sheets. On a quarterly basis, the Company accrues interest on the unpaid balance.
The Company has recorded estimated liabilities for current and historical sales taxes, which are included in accrued expenses in the Consolidated Balance Sheets. On a quarterly basis, the Company accrues interest on the unpaid balance.
Management recognizes that non-GAAP financial measures have limitations in that they do not reflect all of the items associated with our net income as determined in accordance with GAAP, and are not a substitute for or a measure of our profitability or net earnings Adjusted Gross Profit and Margin We define Adjusted Gross Profit as revenue less cost of sales, exclusive of depreciation of internally-developed software and amortization of intangible assets related to technologies obtained through acquisitions.
Management recognizes that non-GAAP financial measures have limitations in that they do not reflect all of the items associated with our net income as determined in accordance with GAAP, and are not a substitute for or a measure of our profitability or net earnings.
Accordingly, Adjusted EBITDA contains a negative adjustment. (c) We have excluded expenses incurred in connection with business acquisitions as it does not represent recurring costs or charges related to our core operations. (d) Consists of expenses incurred in connection with non-recurring severance charges related to work force reduction.
Accordingly, Adjusted EBITDA contains a negative adjustment. (c) We have excluded expenses incurred in connection with business acquisitions as it does not represent recurring costs or charges related to our core operations. We have also excluded expenses incurred associated with the acquisition of the Company as described in Note 21 - Subsequent Events and one-time license applications fees.
Net cash used in investing activities Net cash used in investing activities was $18.6 million for the year ended June 30, 2024 compared to $51.9 million in the prior year.
Net cash used in investing activities Net cash used in investing activities was $28.1 million for the year ended June 30, 2025 compared to $18.6 million in the prior fiscal year. We paid $11.1 million in cash for business acquisitions during the year ended June 30, 2025, compared to $3.7 million for the year ended June 30, 2024.
Operating expenses increased by $8.0 million, or 9.9%, for the year ended June 30, 2024 compared to the prior year. The change was primarily attributed to an increase of $4.5 million in general and administrative expenses, a $7.9 million increase in sales and marketing costs, a $3.0 million increase in depreciation and amortization.
The change was primarily attributed to an increase of $2.7 million in general and administrative expenses, a $2.8 million increase in sales and marketing costs, a $5.3 million increase in depreciation and amortization, a $1.5 million increase in investigation, proxy solicitation and restatement expenses, and a $0.9 million increase in technology and product development expenses.
The change in working capital balance was primarily driven by a $21.1 million increase in accounts payable and accrued expenses and a $9.4 million increase in inventory, offset by a $18.5 million increase in accounts receivable, a $4.0 million increase to our provision for credit losses and sales and a $3.7 million increase in finance receivables.
The change in working capital was primarily driven by a $25.0 million decrease in accounts payable and accrued expenses, a $4.6 million increase in prepaid and other current assets, and a $4.6 million increase in inventory, offset by a $4.7 million decrease in accounts receivable, a $4.8 million decrease in finance receivables and a $1.3 million increase in operating lease liabilities.
Our primary sources of capital available are cash and cash equivalents on hand of $58.9 million as of June 30, 2024 and the cash that we expect to be provided by operating activities. 34 We believe that our current financial resources will be sufficient to fund its current twelve-month operating budget from the date of issuance of these consolidated financial statements.
We believe that our current financial resources will be sufficient to fund its current twelve-month operating budget from the date of issuance of these consolidated financial statements.
The increase was attributable to a $31.3 million increase in subscription and transaction fees, partially offset by a $6.3 million decrease in equipment sales. The increase in subscription and transaction fees was primarily driven by increased processing volumes, with an approximately 15% increase in total dollar volumes for the year ended June 30, 2024 compared to the prior year.
The increase in transaction fees was primarily driven by increased average ticket items sold, increased average ticket price, increased processing volumes, and the acquisition Cheq, with an approximately 13% increase in total dollar volumes for the year ended June 30, 2025 compared to the prior fiscal year.
CONTRACTUAL OBLIGATIONS As of June 30, 2024, the Company had certain contractual obligations due over a period of time as summarized in the following table: Payments Due by Fiscal Year ($ in thousands) Total Less than 1 year 1-3 years 3-5 years More than 5 years Debt and financing obligations (a) $ 44,612 $ 1,453 $ 43,159 $ — $ — Operating lease obligations (b) 13,951 1,637 4,105 2,740 5,469 Total contractual obligations $ 58,563 $ 3,090 $ 47,264 $ 2,740 $ 5,469 (a) Our debt and financing obligations include both principal and interest obligations.
In fiscal year 2024, net cash used in financing activities was $1.1 million which was primarily principal payments on the Company's long-term debt. 38 CONTRACTUAL OBLIGATIONS As of June 30, 2025, the Company had certain contractual obligations due over a period of time as summarized in the following table: Payments Due by Fiscal Year ($ in thousands) Total Less than 1 year 1-3 years 3-5 years More than 5 years Debt and financing obligations (a) $ 47,802 $ 2,296 $ 6,765 $ 38,741 $ — Operating lease obligations (b) 13,560 2,442 3,903 2,471 4,744 Total contractual obligations $ 61,362 $ 4,738 $ 10,668 $ 41,212 $ 4,744 (a) Our debt and financing obligations include both principal and interest obligations.
Sales and marketing expenses increased approximately $7.9 million for the year ended June 30, 2024 compared to the year ended June 30, 2023. The change was primarily due to higher sales and marketing employee personnel cost in the current year, to support our expanding business and service offerings in the United States and international markets. Technology and product development.
The change was primarily due to an increased $1.4 million due to advertising and trade show expenses and higher sales and marketing employee personnel costs in the current year with a $1.1 million increase due to employee compensation and benefits. The increased personnel costs are to support our expanding business and service offerings in the United States and international markets.
Other income (expense), Net Year ended June 30, Change Percent Change ($ in thousands) 2024 2023 2024 v. 2023 Other income (expense): Interest income from cash and leases $ 1,969 $ 2,515 $ (546) (21.7 %) Interest expense from debt and tax liabilities (2,934) (2,326) (608) 26.1 % Other income (expense) (226) (135) (135) 67.4 % Total other (expenses) income, net $ (1,191) $ 54 $ (1,289) (2,305.6 %) Other income (expense), Net Total other expense, net for the fiscal year ended June 30, 2024 was $1.2 million, compared to an income of $0.1 million for the year ended June 30, 2023.
Other (expense) income, Net Year ended June 30, Change Percent Change ($ in thousands) 2025 2024 2025 v. 2024 Other (expense) income: Interest income $ 1,561 $ 1,969 $ (408) (20.7 %) Interest expense (2,769) (2,934) 165 (5.6 %) Other income (expense), net 1,059 (226) 1,285 (568.6 %) Total other (expense) income, net $ (149) $ (1,191) $ 1,042 (87.5 %) Other (expense) income, net Total other expense, net for the fiscal year ended June 30, 2025 was $0.1 million, compared to an income of $1.2 million for the year ended June 30, 2024.
For the fiscal year ended June 30, 2023, the Company incurred professional service fees of $3.1 million from accounting, legal, investing banking advisors and consulting services for the successful completion of the 32M acquisition, as well as post-acquisition costs associated with the integration process. Depreciation and amortization.
For the fiscal year ended June 30, 2025, the Company integration, acquisition, due diligence and license application expenses were $1.6 million from accounting, legal, investing banking advisors and consulting services for the successful completion of the SB acquisition and seller due diligence fees associated with the sale of the Company as described in Note 21 - Subsequent Events .
Interest income decreased $0.5 million due to a decrease in the finance receivables balance associated with our equipment financing program. 32 Non-GAAP Financial Measures We use non-GAAP financial measures for financial and operational decision-making purposes and as a means to evaluate period-to-period comparisons.
Interest income decreased $0.4 million primarily due to a decrease in the finance receivables balance associated with our equipment financing program.
Cost of subscription and transaction fees increased $11.7 million primarily due to corresponding increases in transaction processing fee revenue and transaction processing volumes. Cost of equipment sales decreased $8.1 million primarily due to a decrease in the volume of equipment sold during the current fiscal year as a result of 3G to 4G upgrades as described above.
The increase was attributed to a $11.3 million increase in cost of transaction fees, a $1.1 million increase in equipment costs, and a $0.4 million increase in cost of subscription fees. Cost of transaction fees increased primarily due to corresponding increases in transaction processing fee revenue and transaction processing volumes.
GAAP gross profit to Adjusted Gross Profit and Adjusted Gross Margin for the fiscal years ended June 30, 2024 and 2023: Year Ended June 30, Change Percent Change ($ in thousands) 2024 2023 2024 v. 2023 Gross profit, subscription and transaction fees (GAAP) $ 93,330 $ 75,488 $ 17,842 23.6 % Amortization (1) 6,767 5,020 1,747 34.8 % Adjusted Gross Profit, subscription and transaction fees (non-GAAP) $ 100,097 $ 80,508 $ 19,589 24.3 % Gross profit, equipment (GAAP) $ 2,554 $ 728 $ 1,826 250.8 % Total Adjusted Gross Profit (non-GAAP) $ 102,651 $ 81,236 $ 21,415 26.4 % Adjusted Gross Margin (non-GAAP): Subscription and transaction fees (non-GAAP) 43.2 % 40.2 % 3.0 % Equipment sales (GAAP) 6.9 % 1.7 % 5.2 % Total Adjusted Gross Margin (non-GAAP) 38.2 % 33.3 % 4.9 % (1) Amortization of internal-use software assets and developed technology assets.
GAAP gross profit to Adjusted Gross Profit and Adjusted Gross Margin for the fiscal years ended June 30, 2025 and 2024: Year Ended June 30, Change Percent Change ($ in thousands) 2025 2024 2025 v. 2024 Gross profit, transaction (GAAP) $ 44,919 $ 32,871 $ 12,048 36.7 % Gross margin, transaction (GAAP) 25.0 % 21.0 % 4.0 % Gross profit, subscription (GAAP) 63,445 60,459 2,986 4.9 % Amortization (1) 11,683 6,767 4,916 72.6 % Adjusted Gross Profit, subscription fees (non-GAAP) $ 75,128 $ 67,226 $ 7,902 11.8 % Adjusted Gross Margin, subscription fees (non-GAAP) 89.9 % 89.2 % Gross profit, equipment (GAAP) $ 3,777 $ 2,554 $ 1,223 47.9 % Gross margin, equipment (GAAP) 9.6 % 6.9 % 2.7 % Total Adjusted Gross Profit (non-GAAP) $ 123,824 $ 102,651 $ 21,173 20.6 % Total Adjusted Gross Margin (non-GAAP) 40.9 % 38.2 % (1) Amortization of internal-use software assets and developed technology assets.
Operating Expenses Year ended June 30, Change Percent Change ($ in thousands) 2024 2023 2024 v. 2023 Sales and marketing $ 20,310 $ 12,427 $ 7,883 63.4 % Technology and product development 16,532 20,726 (4,194) (20.2 %) General and administrative 41,395 36,926 4,469 12.1 % Investigation, proxy solicitation and restatement expenses, net of insurance recoveries (1,522) (362) (1,160) 320.4 % Integration and acquisition 1,197 3,141 (1,944) (61.9 %) Depreciation and amortization 10,570 7,618 2,952 38.8 % Total operating expenses $ 88,482 $ 80,476 $ 8,006 9.9 % Total operating expenses.
Operating Expenses Year ended June 30, Change Percent Change ($ in thousands) 2025 2024 2025 v. 2024 Sales and marketing $ 23,075 $ 20,310 $ 2,765 13.6 % Technology and product development 17,449 16,532 917 5.5 % General and administrative 44,075 41,395 2,680 6.5 % Investigation, proxy solicitation and restatement expenses, net of insurance recoveries — (1,522) 1,522 (100.0 %) Integration, acquisition, due diligence, and license application expenses 1,018 1,197 (179) (15.0 %) Depreciation and amortization 15,877 10,570 5,307 50.2 % Total operating expenses $ 101,494 $ 88,482 $ 13,012 14.7 % Total operating expenses.
GAAP net income before (i) interest income on cash and leases, (ii) interest expense on debt and sales tax reserves, (iii) income tax provision, (iv) depreciation, (v) amortization, (vi) stock-based compensation expense, (vii) fees and charges, net of reimbursement from insurance proceeds, that were incurred in connection with the 2019 Investigation and financial statement restatement activities as well as proxy solicitation costs that are not indicative of our core operations, (viii) one-time project expense, one-time severance expenses, and infrequent integration and acquisition expense, and (ix) certain other significant infrequent or unusual losses and gains that are not indicative of our core operations including asset impairment charges, and gain on extinguishment of debt.
GAAP net income before (i) interest income, (ii) interest expense, (iii) income tax provision, (iv) depreciation, (v) amortization, (vi) stock-based compensation expense, and (vii) certain other significant infrequent or unusual losses and gains that are not indicative of our core operations such as (a) investigation, proxy solicitation and restatement expenses, net of insurance recoveries, (b) integration, acquisition, due diligence, and license application expenses, (c) costs as a result of auditor transitions, (d) severance, and (e) remediation expenses. 36 We believe Adjusted EBITDA is useful for investors in comparing our financial performance to other companies and from period to period.
This increase was partially offset by a $1.9 million decrease in integration and acquisition expense, a $1.2 million decrease in investigation, proxy solicitation and restatement expenses, and a $4.2 million decrease in technology and product development expenses. See further details within individual categories below. Sales and marketing.
This increase was partially offset by a $0.2 million decrease in Integration, acquisition, due diligence, and license application expenses. See further details within individual categories below. 34 Sales and marketing. Sales and marketing expenses increased approximately $2.8 million for the year ended June 30, 2025 compared to the year ended June 30, 2024.
Depreciation and amortization expense increased $3.0 million for the year ended June 30, 2024 compared to the prior year primarily due to a $2.2 million increase in depreciation on internal-use software and a $0.5 million increase in amortization of intangible assets as a result of 12 months of 32M acquisition compared to 7 months in year ended June 30, 2023 and as a result of the Cheq acquisition.
Depreciation and amortization. Depreciation and amortization expense increased $5.3 million for the year ended June 30, 2025 compared to the prior fiscal year as a result of certain capitalized internal-use software which is no longer expected to provide future economic benefits as a result of changes in business strategy and evolving technology initiatives.
Costs of sales Costs of sales increased $3.5 million for the year ended June 30, 2024 compared to the year ended June 30, 2023. The increase was attributed to a $11.7 million increase in Cost of subscription and transaction fees, partially offset by a $8.1 million decrease in equipment costs.
Equipment revenue increased by $2.3 million primarily due to the increased sales of our Smart Stores product, which we launched in December 2024. Costs of sales Costs of sales increased $12.8 million for the year ended June 30, 2025 compared to the year ended June 30, 2024.
In fiscal year 2023, we paid $35.7 million in cash for the 32M acquisition and invested $16.2 million in property and equipment. Net cash used in or provided by financing activities Net cash used in financing activities was $1.1 million for the year ended June 30, 2024.
Net cash provided by (used in) financing activities Net cash provided by financing activities was less than $0.1 million for the year ended June 30, 2025, which was the result of $0.7 million in deferred consideration associated with the Cheq acquisition offset by proceeds from the exercise of common stock options.
(2) Amortization of internal-use software assets and developed technology assets. (3) The Company's internal-use software assets and developed technology assets are not associated with equipment sales. 30 Revenues Total revenues increased by $25.0 million, or 10%, from $243.6 million for the year ended June 30, 2023, to $268.6 million for the year ended June 30, 2024.
For the year ended June 30, 2025, the Company recognized additional charges of $3.0 million, due to certain capitalized internal-use software is no longer expected to provide future economic benefits as a result of changes in business strategy and evolving technology initiatives. 33 Revenues Total revenues increased by $34.0 million, or 13%, from $268.6 million for the year ended June 30, 2024, to $302.5 million for the year ended June 30, 2025.
Removed
Highlights Highlights of the Company for the fiscal year ended June 30, 2024 are below: • Revenues of $269 million, an increase of 10% year over year, led by higher transaction and subscription fees revenue; • $3.0 billion in dollar volume of transactions for the year ended June 30, 2024 compared to $2.6 billion for the year ended June 30, 2023, an increase of $0.4 billion, or 15%; • 1.22 million Active Devices as of June 30, 2024 compared to 1.17 million as of June 30, 2023, an increase of approximately 55 thousand Active Devices, or 5%; • 31,466 Active Customers to our service as of June 30, 2024 compared to 28,584 as of June 30, 2023, an increase of 2,882 Active Customers, or 10%; • We acquired Cheq, which offers a portfolio of POS solutions that include both register and self-service kiosk ordering, handheld devices for taking payments on-the-go, and mobile app ordering for pick-up or in-seat delivery – serving the sports stadium, entertainment venues and festival industries; • We launched Seed Analytics and Seed Intelligence, two new premium analytics tools available within the Seed Pro platform, designed to transform the way vending operators leverage data for business growth with improved decision-making and enhanced productivity; 28 • Continued our thought-leadership initiatives, including the release of our 2024 Micropayment Trends Report, which studied micro payment trends (transactions less than $10) at food and beverage vending and at amusement machines throughout the United States and Canada in 2023; • In February 2024, we held our annual user conference, Cantaloupe University, in Las Vegas, NV, where we showcased our latest technologies and provided two days of training and education around our entire platform and suite of products; and • We showcased our full suite of solutions for the European and Mexico markets at Cantaloupe LIVE in the Milton-Keynes, U.K. and Mexico City, Mexico.
Added
Recent Developments Merger with 365 Retail Markets, LLC On June 15, 2025, we entered into the Merger Agreement with 365 Retail Markets , Holdco, Holdco II and Merger Sub. Subject to the terms and conditions of the Merger Agreement, 365 Retail Markets has agreed to acquire the Company in exchange for the Merger Consideration.
Removed
Both events allowed customers, partners and industry professionals to see the latest technology for self-service retail serving their respective markets. We also showcased our cashless device the P30, the Seed platform, micro market technology and our smart coolers with age verification solutions at various industry trade shows within Mexico.
Added
Upon the consummation of the Merger, we will cease to be a publicly traded company. We have agreed to various customary covenants and agreements, including, among others, agreements to conduct our business in the ordinary course during the period between the execution of the Merger Agreement and the effective time of the Merger.
Removed
Our transaction fees increased $23.6 million, or 18%, due to an increase in the average price per transaction and Total Number of Transactions relative to the prior year.
Added
We do not believe these restrictions will prevent us from meeting our debt service obligations, ongoing costs of operations, working capital needs, or capital expenditure requirements. The Merger is expected to close in the second half of calendar year 2025 , subject to customary closing conditions, including the receipt of required regulatory approvals.
Removed
Our Cheq acquisition contributed $2.1 million in subscription and transaction fees for the year ended June 30, 2024. The decrease in equipment sales for the year ended June 30, 2024 was primarily driven by the upgrades of some of our customers from 3G to 4G network compatible devices in 2023, with these upgrades substantially complete in 2024.
Added
One Big Beautiful Bill Act On July 4, 2025, new U.S. tax legislation was signed into law (known as the “One Big Beautiful Bill Act” or “OBBBA”) which makes permanent many of the tax provisions enacted in 2017 as part of the Tax Cuts and Jobs Act that were set to expire at the end of 2025.
Removed
Technology and product development expenses decreased approximately $4.2 million for the year ended June 30, 2024 compared to the year ended June 30, 2023. The decrease in the current year was driven by lower expensed personnel costs as we continued to invest in internal-use software which resulted in higher capitalized costs compared to the prior year.
Added
In addition, the OBBBA makes changes to certain U.S. corporate tax provisions, but many are generally not effective until 2026.
Removed
We focus on investing in innovative technologies, specifically advancing mobile enhancements across the Seed platform, Cantaloupe Go and the mobile loyalty platform for consumers.
Added
The Company is currently evaluating the impact of the new legislation but does not expect it to have a material impact on the results of operations. 30 Highlights Highlights of the Company for the fiscal year ended June 30, 2025 are below: • Revenues of $303 million, an increase of 13% year over year, led by higher transaction and subscription fees revenue. • $3.4 billion in dollar volume of transactions for the year ended June 30, 2025 compared to $3.0 billion for the year ended June 30, 2024, an increase of $0.4 billion, or 13%. • 1.28 million Active Devices as of June 30, 2025 compared to 1.22 million as of June 30, 2024, an increase of approximately 57 thousand Active Devices, or 5%. • 34,896 Active Customers to our service as of June 30, 2025 compared to 31,466 as of June 30, 2024, an increase of 3,430 Active Customers, or 11%. • We acquired SB Software, which is in the business of vending and coffee management in the U.K.
Removed
Additional expenses in technology were incurred to further strengthen our network environment and platform, which will provide our customers greater stability, reliability, and overall higher performance on processing transactions and transmitting data. 31 General and administrative expenses. General and administrative expenses increased approximately $4.5 million for the year ended June 30, 2024 compared to the year ended June 30, 2023.
Added
The acquisition enhances Cantaloupe's operational capabilities and market reach in Europe. • In August 2024, we launched Suites, a premium suite management system designed to streamline and enhance the hospitality suite experience at stadiums and venues.
Removed
The increase was primarily driven by a $2.9 million increase in personnel compensation cost, as a result of our growing business, including a 33% increase to our headcount year-over-year, a $2.8 million increase in consulting professional services spent as part of our remediation of previously identified material weaknesses in our internal controls over financial reporting and $0.4 million increase in rent expense.
Added
This new offering within Cantaloupe's Cheq platform, aims to redefine how venues manage premium suite pre-orders by providing a seamless, user-friendly solution for both suite owners and venue operators. • In September 2024, we released a significant update to our Seed vending management system (VMS) platform which underscores our ongoing commitment to enhancing our core products and delivering exceptional user experience to our vending operators.
Removed
These increases were offset by a $0.8 million decrease in travel and entertainment and a $0.6 million decrease from the release of sales tax reserves. Investigation, proxy solicitation and restatement expenses, net of insurance recoveries.
Added
The refreshed Seed platform offers a modernized user interface that is designed to improve usability and visual appeal.
Removed
During fiscal year 2023, we reached a settlement with the SEC to resolve its 2019 Investigation, which included a civil monetary penalty payment of $1.5 million. The penalty payment was fully paid to the SEC as of June 30, 2023.
Added
The update is optimized for mobile devices and enhances performance and stability. • In October 2024, we launched our AdVantage program, which allows brands to engage with consumers through digital advertising on our point-of-sale (POS) touchscreen devices across the U.S. and Canada. • In December 2024, we launched Smart Store.
Removed
During fiscal year 2023, we received a $2.0 million reimbursement from its directors and officers (D&O) insurance policy for legal fees and expenses incurred in connection with the 2019 Investigation.
Added
These are advanced, self-service retail solutions designed to address key issues such as labor shortages, theft and shrinkage, while maintaining a seamless consumer experience. Smart Stores work by unlocking after a customer presents payment at the POS.
Removed
The D&O reimbursement proceeds were recorded as a reduction of “Investigation, proxy solicitation and restatement expenses, net of insurance recoveries” on our Consolidated Statement of Operations for the fiscal year ended June 30, 2023. For additional information, refer to Note 18 – Commitments and Contingencies to the consolidated financial statements in Part II, Item 8 of this Annual report.
Added
The customer then grabs the items, which are added to their cart, then completes the purchase by pressing "Pay" and walking away. • In December 2024, we were selected by the San Jose Earthquakes, a Major League Soccer club, to be the POS technology solution and Cantaloupe’s Suites premium management system for all games and events at the stadium. • In January 2025, we amended our outstanding credit facilities and entered into the 2025 Credit Facility.
Removed
Our increase in internal-use software is attributable to management's focus on developing innovative technologies to further strengthen our network environment and platform.
Added
The 2025 Credit Facility provides for a $40 million secured term loan facility, a $30 million secured revolving credit, and a $30 million secured delayed draw term loan facility, taking our total borrowing capacity to $100 million. • In January 2025, we launched Engage Pulse card readers for the arcade and amusement industry, which are designed to maximize revenue potential through a ladder pricing interface that allows players to pay once and then enjoy multiple plays.
Removed
Our interest expense increased $0.6 million primarily due to 12 months of interest on our additional borrowing of $25 million to fund a portion of the 32M acquisition in December 2022 in fiscal 2024, compared to 7 months of interest in fiscal 2023.
Added
This feature enables the Engage Pulse to deliver a seamless consumer payment experience while increasing revenue for arcade and amusement operators. • In January 2025, we held our annual user conference, Cantaloupe University, in Miami, Florida, where we showcased our latest technologies and provided two days of training and education around our entire platform and suite of products. • In February 2025, we collaborated with Fundbox to launch Cantaloupe Capital, which provides small businesses with streamlined access to capital for expansion through equipment investments and flexible access to cash flow. • In April 2025, we launched Go Micro, the industry's most affordable and versatile self-service micro market kiosk.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

4 edited+1 added−1 removed0 unchanged
Biggest changeWe invest our excess cash in money market funds that we believe are highly liquid and marketable in the short term. These investments earn a floating rate of interest and are not held for trading or other speculative purposes. Consequently, our exposure to market risks for interest rate changes related to our money market funds is not material.
Biggest changeThese investments earn a floating rate of interest and are not held for trading or other speculative purposes. Consequently, our exposure to market risks for interest rate changes related to our money market funds is not material. We have no freestanding derivative instruments as of June 30, 2025. 41
Interest on the JPMorgan Credit Facility will be based, at the Company’s option, on a base rate or SOFR plus an applicable margin tied to the Company’s total leverage ratio and having ranges of between 2.50% and 3.00% for base rate loans and between 3.50% and 4.00% for SOFR loans.
Interest on the 2025 Credit Facility will be based, at the Company’s option, on a base rate or SOFR plus an applicable margin tied to the Company’s total leverage ratio and having ranges of between 1.75% and 2.50% for base rate loans and between 2.75% and 3.50% for SOFR loans.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk. As of June 30, 2024 we are exp osed to market risk related to changes in interest rates on our outstanding borrowings. Our JPMorgan Credit Facility matures on March, 16 2026.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk. As of June 30, 2025 we are exp osed to market risk related to changes in interest rates on our outstanding borrowings. Our 2025 Credit Facility matures on January 31, 2030.
As of June 30, 2024, we have $37.6 million total outstanding borrowings under the JPMorgan Credit Facility, an increase of 100 basis points in SOFR Rate would result in a change in interest expense of $0.4 million on our consolidated financial statements. We are also exposed to market risk related to changes in interest rates on our cash investments.
As of June 30, 2025, we have $39.0 million total outstanding borrowings under the 2025 Credit Facility, an increase of 100 basis points in SOFR Rate would result in a change in interest expense of $0.4 million on our consolidated financial statements.
Removed
Market risks related to fluctuations of foreign currencies are not material and we have no freestanding derivative instruments as of June 30, 2024. 37
Added
We are also exposed to market risk related to changes in interest rates on our cash investments and foreign currency exchange rate risks on our cash investments, inventory, accounts payable and accounts receivable. We invest our excess cash in money market funds that we believe are highly liquid and marketable in the short term.

Other CTLP 10-K year-over-year comparisons