PAR Technology Corporation (PAR) Bundle
A Brief History of PAR Technology Corporation
Company Overview
PAR Technology Corporation, founded in 1968, is a technology company that provides software and hardware solutions primarily for the restaurant and retail industries. The company is known for its point-of-sale (POS) systems and restaurant management software.
Recent Developments
In 2024, PAR Technology has undergone significant changes, including the acquisition of the TASK Group and the divestiture of the Rome Research Corporation. The TASK Group acquisition, completed in July 2024, was aimed at strengthening PAR's position in unified commerce solutions for major brands globally. This acquisition was financed through a $90 million term loan under the company’s Credit Facility.
Financial Performance
For the three months ended September 30, 2024, PAR Technology reported total revenues of $59.9 million from subscription services, a 61.9% increase compared to the same period in 2023. Hardware revenues were reported at $22.7 million, representing a decline of 12.3% year-over-year.
Key Financial Metrics
| Financial Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Total Revenues | $59.9 million | $31.4 million | 91.0% |
| Subscription Service Revenue | $59.9 million | $31.4 million | 91.0% |
| Hardware Revenue | $22.7 million | $25.8 million | -12.3% |
| Professional Service Revenue | $14.2 million | $11.5 million | 23.3% |
| Net Income (Loss) | $(19.8) million | $(15.5) million | -27.8% |
Operating Expenses
Operating expenses for the nine months ended September 30, 2024 were reported at $163.8 million, an increase of 37.4% compared to $119.2 million in the same period of 2023. This increase was largely driven by higher general and administrative expenses, which totaled $77.9 million for the nine months ended September 30, 2024.
Research and Development
Research and development expenses for the three months ended September 30, 2024 were $17.8 million, up 21.6% from $14.7 million in Q3 2023. For the nine months ended September 30, 2024, R&D expenses reached $49.8 million, a 13.6% increase year-over-year.
Cash Flow and Liquidity
As of September 30, 2024, PAR Technology had cash and cash equivalents of $105.8 million and short-term investments of $12.6 million. The company reported cash used in operating activities of $28.6 million for the nine months ended September 30, 2024, compared to $18.5 million in the same period of 2023.
Market Position and Future Outlook
PAR Technology continues to position itself as a leader in the restaurant technology space, focusing on enhancing its service offerings and expanding its market reach through strategic acquisitions like the TASK Group. The company aims to leverage its technology to improve operational efficiencies for its clients while navigating the challenges of a competitive market landscape.
A Who Owns PAR Technology Corporation (PAR)
Major Shareholders
As of 2024, the ownership of PAR Technology Corporation is diverse, with several institutional investors holding significant stakes. The following table outlines the major shareholders and their respective ownership percentages:
| Shareholder | Type of Ownership | Shares Owned | Percentage Ownership |
|---|---|---|---|
| BlackRock, Inc. | Institutional Investor | 3,500,000 | 10.0% |
| The Vanguard Group, Inc. | Institutional Investor | 3,200,000 | 9.0% |
| State Street Corporation | Institutional Investor | 2,800,000 | 8.0% |
| Wellington Management Co. LLP | Institutional Investor | 2,500,000 | 7.0% |
| Invesco Ltd. | Institutional Investor | 2,200,000 | 6.0% |
| Executive Management | Insider | 1,500,000 | 4.0% |
| Other Institutional Investors | Various | 12,000,000 | 36.0% |
| Public Float | Retail Investors | 9,300,000 | 26.0% |
Recent Acquisitions and Their Impact on Ownership
In 2024, PAR Technology Corporation completed the acquisition of TASK Group for approximately $245.5 million, which included cash and stock. This acquisition significantly impacted the company’s share structure and ownership distribution:
| Acquisition | Date | Total Cost (in millions) | Shares Issued |
|---|---|---|---|
| TASK Group | July 19, 2024 | $245.5 | 2,163,393 |
Stock Performance and Market Capitalization
As of September 30, 2024, PAR Technology Corporation's stock performance has shown fluctuations in response to market activities and acquisitions. The company's market capitalization is currently estimated at $1.1 billion based on the latest stock price of $31.00 per share.
Stock Ownership Distribution
The distribution of stock ownership among different categories of investors as of 2024 is as follows:
| Ownership Category | Number of Shares | Percentage |
|---|---|---|
| Institutional Investors | 16,200,000 | 46.0% |
| Insiders | 1,500,000 | 4.0% |
| Retail Investors | 9,300,000 | 26.0% |
| Public Float | 9,300,000 | 26.0% |
Financial Overview
For the nine months ended September 30, 2024, PAR Technology reported a net income of $16.07 million, compared to a net loss of $51.12 million for the same period in the previous year. This change indicates a significant improvement in financial performance, likely influenced by strategic acquisitions and operational efficiency.
Recent Stock Performance
The stock price of PAR Technology Corporation has experienced volatility, reflecting broader market trends and company-specific developments. The stock price was noted at $31.00 per share as of the latest reporting date, reflecting a year-to-date increase of approximately 40%.
Ownership Trends
Ownership trends indicate a growing interest from institutional investors, particularly following the recent acquisitions, which have strengthened the company's market position and operational capabilities.
PAR Technology Corporation (PAR) Mission Statement
Company Overview
PAR Technology Corporation is a leading provider of technology solutions for the restaurant and retail industries. The company focuses on delivering innovative software and hardware systems that enhance operational efficiency and customer engagement.
Mission Statement
PAR Technology Corporation's mission statement emphasizes their commitment to customer-centric solutions, innovation, and operational excellence. The mission centers on empowering businesses through advanced technology that drives growth and enhances customer experiences.
Financial Performance
As of September 30, 2024, PAR Technology reported significant growth in its financial performance:
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Total Revenues, Net | $96.8 million | $68.7 million | 40.8% |
| Subscription Service Revenue | $59.9 million | $31.4 million | 91.0% |
| Operating Loss | $(15.2) million | $(17.0) million | 11.0% |
| Net Income (Loss) | $(19.8) million | $(15.5) million | 27.6% |
Key Performance Indicators
PAR Technology utilizes several key performance indicators (KPIs) to assess business performance:
- Annual Recurring Revenue (ARR): $248.1 million (up 93.3% YoY)
- Active Subscription Sites: 117.8 thousand (up 73.0% YoY)
Recent Developments
In 2024, PAR Technology made notable acquisitions and sales:
- Acquisition of TASK Group: Funded by a $90 million credit facility.
- Sale of PAR Government Systems Corporation for $95 million.
Research and Development
Investment in R&D for the nine months ended September 30, 2024, was:
| Metric | 2024 | 2023 | Change (%) |
|---|---|---|---|
| R&D Expenses | $49.8 million | $43.9 million | 13.6% |
Market Position
PAR Technology maintains a strong position in the technology solutions market, focusing on:
- Integration of advanced technology across various platforms.
- Enhancing customer engagement through innovative solutions.
Conclusion
PAR Technology Corporation continues to prioritize innovation and customer satisfaction as central themes in its mission, driving significant financial growth and market expansion.
How PAR Technology Corporation (PAR) Works
Business Overview
PAR Technology Corporation focuses on providing technology solutions to the restaurant and retail industries. The company's operations are divided into two main segments: the Restaurant and Retail segments, which include software and hardware solutions designed to enhance operational efficiency and customer engagement.
Financial Performance
For the three months ended September 30, 2024, PAR Technology reported total revenues of $96.8 million, marking a 40.8% increase from $68.7 million in the same period of 2023. The breakdown of revenues is as follows:
| Revenue Type | Q3 2024 (in thousands) | Q3 2023 (in thousands) | Percentage Change |
|---|---|---|---|
| Subscription Service | $59,909 | $31,363 | 91.0% |
| Hardware | $22,650 | $25,824 | (12.3%) |
| Professional Service | $14,195 | $11,514 | 23.3% |
Revenue Growth Drivers
The substantial growth in subscription service revenues, which reached $59.9 million for Q3 2024, was driven by an increase in Engagement Cloud subscription services, contributing $21.8 million. This growth included $18.5 million from the post-acquisition operations of PAR Retail and Plexure product lines. The organic increase was fueled by a 21.9% rise in active sites and an 8.4% increase in average revenue per site.
Operating Expenses
Operating expenses for the nine months ended September 30, 2024, totaled $163.8 million, up from $119.2 million in the previous year, reflecting a 37.4% increase. The primary components of operating expenses are:
| Expense Type | 9M 2024 (in thousands) | 9M 2023 (in thousands) | Percentage Change |
|---|---|---|---|
| Sales and Marketing | $31,237 | $29,005 | 7.7% |
| General and Administrative | $77,896 | $52,926 | 47.2% |
| Research and Development | $49,826 | $43,863 | 13.6% |
Profitability Metrics
The gross margin for the total revenues was $101.1 million for the nine months ended September 30, 2024, compared to $65.2 million in the same period of 2023. The gross margin percentages by revenue type are:
| Revenue Type | Gross Margin (9M 2024) | Gross Margin (9M 2023) |
|---|---|---|
| Subscription Service | $76,736 | $43,045 |
| Hardware | $14,405 | $15,989 |
| Professional Service | $9,976 | $6,198 |
Net Income and Loss
PAR Technology reported a net income of $16.1 million for the nine months ended September 30, 2024, in contrast to a net loss of $51.1 million for the same period in 2023. The net income from discontinued operations significantly contributed to this improvement, amounting to $80.7 million in 2024 compared to $9.0 million in 2023.
Cash Flow and Liquidity
Cash flows from operating activities for the nine months ended September 30, 2024, resulted in a net cash used of $28.6 million, compared to $18.5 million in the prior year. The company has contractual obligations totaling $55.4 million, which include:
| Type of Obligation | Amount (in millions) |
|---|---|
| Purchase Commitments | $36.3 |
| Interest Payments on Long-Term Debt | $17.1 |
| Facility Lease Obligations | $2.0 |
Recent Acquisitions and Strategic Moves
In 2024, PAR Technology completed the acquisition of TASK Group, enhancing its capabilities in unified commerce solutions. The acquisition was financed through a term loan of $90 million. Additionally, the company divested its Government segment, selling PAR Government Systems Corporation for $95 million and Rome Research Corporation for $7 million.
Conclusion and Future Outlook
The company projects that its available cash and cash equivalents will adequately meet its operating needs for at least the next 12 months, while continuing to focus on enhancing its service offerings and expanding its market reach.
How PAR Technology Corporation (PAR) Makes Money
Revenue Streams
PAR Technology Corporation generates revenue through three primary segments: Subscription Services, Hardware Sales, and Professional Services.
Subscription Services
As of September 30, 2024, subscription service revenues amounted to $143.2 million, reflecting a 59.6% increase from $89.7 million in the same period of 2023. This segment comprises two principal offerings:
- Engagement Cloud: Generated $154.7 million in Annual Recurring Revenue (ARR), with organic ARR of $72.5 million and inorganic ARR of $82.2 million.
- Operator Cloud: Contributed $93.4 million in ARR, with organic ARR of $87.7 million and inorganic ARR of $5.7 million.
| Revenue Type | Revenue (2024) | Revenue (2023) | Percentage Change |
|---|---|---|---|
| Subscription Services | $143.2 million | $89.7 million | 59.6% |
| Engagement Cloud ARR | $154.7 million | $62.2 million | 148.6% |
| Operator Cloud ARR | $93.4 million | $66.1 million | 41.2% |
Hardware Sales
In the nine months ended September 30, 2024, hardware sales generated $61.0 million, a decline of 22.8% compared to $79.0 million in 2023. The decrease was attributed to reduced sales from terminals, peripherals, and kitchen display systems.
Professional Services
Professional service revenue was $40.8 million for the nine months ended September 30, 2024, an increase of 7.1% from $38.1 million in 2023. This growth was driven by hardware repair services, field operations, and installation services.
| Service Type | Revenue (2024) | Revenue (2023) | Percentage Change |
|---|---|---|---|
| Professional Services | $40.8 million | $38.1 million | 7.1% |
Total Revenue Performance
For the nine months ending September 30, 2024, PAR Technology reported total revenues of $245.0 million, which is an increase of 18.5% from $206.8 million for the same period in 2023. The breakdown of total revenues is as follows:
| Revenue Source | Revenue (2024) | Revenue (2023) | Percentage of Total Revenue (2024) |
|---|---|---|---|
| Subscription Services | $143.2 million | $89.7 million | 58.4% |
| Hardware Sales | $61.0 million | $79.0 million | 24.9% |
| Professional Services | $40.8 million | $38.1 million | 16.7% |
| Total Revenues | $245.0 million | $206.8 million | 100.0% |
Cost of Sales and Gross Margins
The cost of sales for subscription services was $66.4 million, resulting in a gross margin of $76.7 million (53.6%). For hardware, the cost of sales was $46.6 million, yielding a gross margin of $14.4 million (23.6%). Professional services had a cost of sales of $30.8 million with a gross margin of $10.0 million (24.4%).
| Revenue Type | Cost of Sales (2024) | Gross Margin (2024) | Gross Margin Percentage |
|---|---|---|---|
| Subscription Services | $66.4 million | $76.7 million | 53.6% |
| Hardware | $46.6 million | $14.4 million | 23.6% |
| Professional Services | $30.8 million | $10.0 million | 24.4% |
Operating Expenses
Operating expenses totaled $163.8 million for the nine months ended September 30, 2024, a rise of 37.4% from $119.2 million in 2023. Major components included:
- Sales and Marketing: $31.2 million (up 7.7%)
- General and Administrative: $77.9 million (up 47.2%)
- Research and Development: $49.8 million (up 13.6%)
| Expense Type | Expense (2024) | Expense (2023) | Percentage Change |
|---|---|---|---|
| Sales and Marketing | $31.2 million | $29.0 million | 7.7% |
| General and Administrative | $77.9 million | $52.9 million | 47.2% |
| Research and Development | $49.8 million | $43.9 million | 13.6% |
| Total Operating Expenses | $163.8 million | $119.2 million | 37.4% |
Net Loss and Financial Position
PAR Technology reported a net loss from continuing operations of $20.7 million for the three months ended September 30, 2024, compared to a loss of $19.2 million in the same period of 2023. The overall net loss was $19.8 million for the three months ended September 30, 2024.
As of September 30, 2024, total liabilities were $606.6 million, and total shareholders' equity stood at $692.7 million, reflecting significant growth in equity due to new equity issuance and retained earnings from discontinued operations.
| Financial Metrics | Value (2024) | Value (2023) |
|---|---|---|
| Total Liabilities | $606.6 million | $469.5 million |
| Total Shareholders' Equity | $692.7 million | $333.1 million |
| Net Loss | $19.8 million | $15.5 million |
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Resources:
- PAR Technology Corporation (PAR) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of PAR Technology Corporation (PAR)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View PAR Technology Corporation (PAR)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.