VerifyMe, Inc.

Q3 2025 revenue was $5.0 million versus $5.4 million in Q3 2024, a decline of $0.4 million, or about 7% year over year. Gross profit increased to $2.1 million from $1.9 million, and gross margin expanded to 41% from 35%. Net loss was $3.4 million, or $0.26 per diluted share, versus a net loss of $2.9 million, or $0.23 per diluted share, last year; this included a one-time non-cash impairment expense of $3.9 million versus $1.9 million in Q3 2024. Adjusted EBITDA improved to $0.8 million from $0.2 million, operating expenses excluding impairment fell to $1.7 million from $2.5 million, and cash on hand was $4.0 million at September 30, 2025. Management said Q4 2025 and Q1 2026 revenue will likely decrease versus prior year due to the shipping-partner transition, while gross margin should remain consistent with current performance; the company expects to remain cash flow positive for full-year 2025 and said it believes it will be cash flow positive in both 2025 and 2026.

Adam Stedham framed the quarter as evidence that the operating model is working despite revenue pressure from customer losses and the transition away from the prior Proactive shipping partner. He emphasized that the new partner relationship should be a better long-term platform for organic growth, especially for small and medium-sized cold-chain customers. His tone was upbeat but cautious, repeatedly noting that the transition is dynamic and that management is not yet ready to provide 2026 guidance.

Jennifer Cola highlighted the main financial drivers: revenue of $5.0 million, gross profit of $2.1 million, and gross margin of 41%, which she said was aided by improved negotiated rates with a primary supplier. She pointed to a $3.9 million non-cash impairment related to PeriShip goodwill and intangible assets, but also noted that operating expenses excluding impairment fell to $1.7 million from $2.5 million, helping adjusted EBITDA rise to $0.8 million. She said cash was $4.0 million, the company has $1 million available under its line of credit with no borrowings outstanding, and Q3 generated $0.2 million of cash from operations; she also said the company expects to use some cash in Q4 to manage the customer transition but still expects full-year 2025 cash flow positivity.

Analysts focused on how much of the business tied to the old Proactive arrangement had rolled off, asking management to size the revenue contribution and explain the Q4 impact. Adam declined to give a numeric breakdown, saying the transition is not a cliff but a sliding scale and that the company cannot accurately predict how many customers will switch before, during, or after peak shipping season. On M&A, he said there have been significant ongoing conversations and that any bolt-on deal would need to be virtually immediately accretive, while a transformative deal could be attractive given the company’s subscale size.