Stran & Company, Inc. Q4 FY2025 earnings call

2025 was a defining year for Strong. Delivered strong financial results with 40.6% revenue growth. 12.9% organic growth in core promotional products business. Total operating expenses declined to 31.1% of revenue in 2025 from 37.2% in 2024. Narrowed net loss to $747,000 from $4.1 million in 2024. Achieved positive EBITDA of $184,000 for full year. Built strong around long-term programmatic relationships, diversified customer base, and technology-enabled platform. Serve over 2,000 active customers including over 30 Fortune 500 companies. Launched new client branded gifting platform. Strengthened leadership and governance by adding experienced public company and industry leaders to board.

Total sales increased 40.6% to $116.2 million in 2025 from $82.7 million in 2024. For the Strawn promo segment, sales increased to $82.1 million in 2025 from $72.7 million in 2024. For the Strawn loyalty segment, sales increased to $34.1 million in 2025 from $9.9 million in 2024. Total gross profit increased 32.6% to $34.2 million, or 29.5% of sales in 2025 compared to $25.8 million, or 31.2% of sales in 2024. For the STRON promo segment, gross profit increased to $27 million in 2025 from $23.7 million in 2024, and gross profit margin increased to 32.9% in 2025 compared to 32.7% in 2024. For the STRON loyalty segment, gross profit increased to $7.2 million in 2025 from $2.1 million in 2024, and gross profit margin increased to 21.1% in 2025 compared to 20.8% in 2024.

While not providing formal guidance, expect meaningful improvement in first quarter profitability in 2026 driven by continued customer demand, increased operating leverage, and strategic progress in 2025. View warrants expiring in fourth quarter of 2026 as near-term catalyst to simplify capital structure.

Elevated tariffs increased product costs, compressed margins, impacted revenue and profitability in loyalty and casino segments. Tariff uncertainty caused hesitation among buyers. However, believe tariffs have stabilized and will not have further material impact on gross margins going forward.

Certainly. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please while we poll for questions. As a reminder, if you would like to ask a question, please press star 1. We have reached the end of the question and answer session, and I will now turn the call over to Andy for closing remarks. Thank you. Apparently we addressed every question since we had no, or we addressed any outstanding questions since we didn't have any. Thank you. Once again, we're encouraged by the results of 2025. We stated that it was a year to continue looking for growth, increase our profitability. We accomplished both of those by seeing 40% growth and really seeing positive EBITDA versus an over $3 million EBITDA loss last year. So we're very encouraged by that. We're very encouraged by the future of the business. Um, we, we again, look at our growth strategy is very simple and getting business from our existing customers, new customers, expanding our offerings, expanding our technology and looking at acquisitions that make sense. And it was very highly fragmented and, and, um, large industry that we really believe in. So thank you, everyone, for the support of STRON, and we look forward to speaking to you in the future about our continued success. Thank you. This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.