PSQ Holdings, Inc. Q4 FY2025 earnings call

• New leadership phase: Simplifying the company, focusing on financial infrastructure, and aligning around disciplined execution. - Four core themes: Strategic focus, operational accountability, cash efficiency, and higher revenue per employee. - FinTech growth: Over 80% year-over-year growth, with over 100% quarter-over-quarter growth in Q4 driven by FinTech infrastructure and credit products. Reduced SG&A expenses by $9.9 million year over year. - Headcount reduction: Reduced headcount from 87 to approximately 50 since September, incurring $250,000 in cash severance expense in Q4, expecting one-time severance costs in first half of 2026. - AI use: Applying machine learning and AI-driven credit scoring models in Credova credit platform, expanding to other parts of the business. - Payments industry shift: Expecting disintermediation in payments ecosystem, focusing on building integrated financial platform for merchants and consumers. - Digital assets: Evaluating stablecoins and blockchain-based settlement rails to improve transaction speed, cost, and reliability. - Divestitures: Evaluating divestitures of certain assets, in active discussions regarding every life business. - Impact platform: Early results positive, technology live in the market.

Net revenue from continuing operations was $18.2 million in 2025, an 81% year-over-year increase from $10.1 million in 2024. GMB grew 411% year-over-year. Financial technology (including payment processing and credit offerings) earned $7.3 million in net revenue in Q4, a 109% increase from the prior year. Credit business revenue in Q4 increased by $1.5 million, or 47% year-over-year, to $4.8 million. Repeat customers increased 25% in 2025. Loan charge-offs reduced by $466,000, or 34%. General and administrative expenses reduced by $9.9 million or 26% in 2025. R&D expenses increased $1.9 million over the prior year. Non-GAAP gross margin for 2025 was 69% compared to 96% in 2024. Discontinued ops: brands driven primarily by every life earned revenue of $14.2 million in 2025, an increase of $4 million and 40%; marketplace earned $1.1 million in 2025.

• Expect revenue per employee to grow significantly in 2026 as the organization is simplified and focuses on core business. - Plan to continue with cash management initiatives including divestiture of brand segment, winding down marketplace, reducing corporate operating expenses, and staff reductions, expecting annualized cash savings of approximately $8 million. - Aim to move closer to profitability in the near term.

• Forward-looking statements involve risks, uncertainties, and assumptions. Actual results may differ materially from forward-looking statements. - Non-GAAP measures are presented in addition to GAAP measures, and market conditions in certain sectors can pose headwinds. - Regulatory complexity around lending and payments could impact the implementation of AI and other initiatives.

Q: Why was now the appropriate time for the management change?

A: The management change was deliberated at the board level as the company made a strategic pivot into FinTech and FinTech infrastructure. Dusty's background in financial technology and leading the Credo FinTech team made him the best fit for the future of FinTech.

Q: How will the go-to-market strategy change for the company's FinTech efforts?

A: It will be executing on what's working, continuing to focus on and efficiently grow the financial technology platform in industries that have been disenfranchised by the financial system.

Q: How do capital priorities include paying down debt, investing in the business, and strategic M&A?

A: Focus in 2026 is on driving revenue per employee, becoming more cash efficient, and moving to profitability. Once that is achieved, there will be optionality for paying down debt, expanding through strategic M&A.

Q: Where are the low hanging fruit in payments and credit?

A: Areas like the 503 and 504 space, and the lending industry (from Loan Payments Pro background) where traditional FinTech shies away.

Q: Is digital asset strategy still part of the go-forward strategy?

A: Focus is on new payment rails, specifically stablecoins, and how to implement them into the payment stack to benefit merchants and consumers.

Q: How encompassing is PSQ's AI use?

A: Internally putting together an AI task force, using AI as a cognitive leverage tool internally, and watching consumer lending for potential external application but being reticent due to regulatory complexity.

Q: How will proceeds from sale of brand segment be used?

A: To drive product roadmap, build markets, create product features with accretive revenue and good unit economics, moving closer to profitability.

Q: What are the KPIs to measure success in running the business?

A: Adjusted EBITDA loss, operating cash flow, and revenue per employee.

Q: What are the three most critical milestones for the company in 2026?

A: Finish divestiture process, improve unit economics with top line revenue, and reduce adjusted EBITDA loss.