Asure Software, Inc.

Second quarter total revenue was $37.1 million, up from $30.1 million in Q2 2025, a 23% increase year over year. Recurring revenue was $34 million versus $28.6 million a year ago, up 19%, and recurring revenue was about 91% of total revenue. Gross profit was $25.1 million versus $19.9 million last year; GAAP gross margin was 68% versus 66%, and non-GAAP gross margin was 73%, unchanged year over year. Net loss narrowed to $4.4 million from $6.1 million, EBITDA was $4.6 million versus $1.4 million, and adjusted EBITDA rose to $7.7 million from $5.2 million, with adjusted EBITDA margin at 21% versus 17%. For the full year 2026, management guided to revenue of $159 million-$163 million and adjusted EBITDA margins of 24%-25%; Q3 guidance is revenue of $38 million-$40 million and adjusted EBITDA of $8 million-$10 million. They also said they expect positive levered free cash flow in the mid to high teens range, and ended Q2 with $19.7 million of cash and cash equivalents and $68.9 million of total debt.

Pat Goepel framed the quarter as validation of Asure’s platform strategy, saying the company is growing, becoming more profitable, and seeing returns from investments in technology and AI. He emphasized AsureCentral adoption, AsureWorks traction, and the move toward a sales force that can sell the full solution rather than point products. He also sounded upbeat on 2027, saying the company is increasingly optimistic as ASO, Luna-enabled automation, and other initiatives take hold.

John Pence walked through the key financials and said the quarter benefited from strong recurring revenue, improved profitability, and stable costs. He noted recurring revenue was 91% of total revenue, non-GAAP gross margin held at 73%, and adjusted EBITDA margin improved to 21%. He also highlighted a planned $600,000 revenue headwind in the first half of 2027 from Lathem’s shift to hardware-as-a-service, said no additional rate cuts are expected this year, and reiterated full-year positive levered free cash flow in the mid to high teens range after roughly $15 million of software capitalization and about $6 million of earned cash interest expense.

Analysts focused on AI’s impact on both revenue and cost structure, sales productivity, the path to double-digit organic growth, ASO differentiation, sales headcount, and the mix shift away from non-recurring revenue. Management said AI is already helping identify cross-sell opportunities through intent and trigger data, and on the cost side it is reducing routine support load and helping customer service focus on more strategic work, though they stressed it is still early days. They also said the back-half growth rate will look muted because last year included more non-recurring professional-services revenue, while this year’s growth is expected to come more from recurring organic products like payroll, 401(k), HR compliance, and time and attendance.