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Hudson Global Reports 2024 Fourth Quarter and Full-Year Results

1. HSON's Q4 revenue fell 1.1% year-over-year to $33.6 million. 2. Net loss increased to $0.6 million from a profit of $0.7 million last year. 3. Invested $3.4 million in technology and marketing for future growth. 4. Americas showed growth, while Asia Pacific and EMEA revenues declined. 5. The company has $240 million in net operating losses for tax benefits.

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Despite some gains in adjusted revenue, overall financial performance and net loss are concerning, similar to past periods of revenue decline leading to stock price drops.

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Immediate results indicate reduced investor confidence; significant operational changes may take time to bear fruit.

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HSONMANRHI
OLD GREENWICH, Conn., March 14, 2025 (GLOBE NEWSWIRE) -- Hudson Global, Inc. (Nasdaq: HSON), a leading global talent solutions company, announced today financial results for the fourth quarter and full year ended December 31, 2024. 2024 Fourth Quarter Summary Revenue of $33.6 million decreased 1.1% from the fourth quarter of 2023, or 2.0% in constant currency.Adjusted net revenue of $17.6 million increased 6.4% from the fourth quarter of 2023, or 5.7% in constant currency.Net loss of $0.6 million, or $0.20 loss per diluted share, versus net income of $0.7 million, or $0.23 income per diluted share, in the fourth quarter of 2023. Adjusted net loss per diluted share (Non-GAAP measure)* decreased to $0.05 from adjusted net income per diluted share of $0.04 in the fourth quarter of 2023.Adjusted EBITDA (Non-GAAP measure)* increased to $0.9 million, versus adjusted EBITDA of $0.1 million in the fourth quarter of 2023. 2024 Full-Year Summary Revenue of $140.1 million decreased 13.2% from 2023, or 13.2% in constant currency.Adjusted net revenue of $70.2 million decreased 12.6% from 2023, or 12.8% in constant currency.Net loss of $4.8 million, or $1.59 loss per diluted share, compared to net income of $2.2 million, or $0.70 income per diluted share, in 2023. Adjusted net loss per diluted share (Non-GAAP measure)* of $0.86 decreased from adjusted net income per diluted share of $0.86 in the prior year.Adjusted EBITDA (Non-GAAP measure)* was $0.9 million, versus adjusted EBITDA of $5.9 million in 2023. Jeff Eberwein, Chief Executive Officer at Hudson Global, said, “Our fourth quarter financial results reflect modest improvement over the prior year quarter, with the Americas region delivering the strongest results. Throughout 2024, we contended with a general low level of global hiring activity as well as unusually low attrition at many legacy clients. Although these challenges are largely out of our control, we are well positioned to take advantage of future growth in the market. During the year, we invested in new technologies to best support our clients' recruitment needs and streamline operations, including sourcing, screening, and onboarding procedures. Altogether in 2024, we invested approximately $3.4 million in sales, marketing, and technology above maintenance levels to enhance future growth.” Jake Zabkowicz, Hudson RPO's Global CEO, noted, “Despite the challenging global talent environment, we continued to consistently deliver best-in-class service to a growing number of clients on a global scale. To that end, we are proud to have been named on the HRO Today's Baker's Dozen List for the 16th consecutive year in the list of top enterprise RPO providers, for the 12th consecutive year as a top RPO provider in APAC and for the 8th consecutive year as a top RPO provider in EMEA.” Mr. Zabkowicz continued, “We have been investing significantly to fuel future growth, and have enhanced our go-to-market strategy by expanding our service offering to existing and prospective clients alike. With the recent launch of our Digital Division, and the hiring of Stephanie Edwards as Chief Digital Officer, we are revolutionizing our digital capabilities and enterprise strategies to deliver innovative, efficient, cost-effective, and high-quality talent solutions to our clients worldwide.” * The Company provides Non-GAAP measures as a supplement to financial results based on accounting principles generally accepted in the United States ("GAAP"). Constant currency, adjusted EBITDA, EBITDA, and adjusted net income or loss per diluted share are defined in the segment tables at the end of this release and a reconciliation of such Non-GAAP measures to the most directly comparable GAAP measures is included within such segment tables. Regional Highlights All growth rate comparisons are in constant currency. Americas In the fourth quarter of 2024, Americas revenue of $7.3 million increased 18% and adjusted net revenue of $6.4 million increased 5% compared to the fourth quarter of 2023. EBITDA was $0.5 million in the fourth quarter of 2024 compared to EBITDA of $0.2 million in same period last year. Adjusted EBITDA was $0.4 million for the fourth quarter of 2024 compared to adjusted EBITDA loss of $0.7 million a year ago. For full year 2024, Americas revenue of $27.9 million decreased 11% and adjusted net revenue of $25.1 million decreased 17% from 2023. EBITDA was $0.3 million for full year 2024 compared to EBITDA loss of $0.7 million in 2023. Adjusted EBITDA was $0.9 million for full year 2024 compared to adjusted EBITDA loss of $0.4 million in 2023. Asia Pacific Asia Pacific revenue of $20.0 million decreased 10% and adjusted net revenue of $7.4 million increased 6% in the fourth quarter of 2024 compared to the same period in 2023. EBITDA was $0.5 million in the fourth quarter of 2024 compared to EBITDA of $0.4 million a year ago. Asia Pacific adjusted EBITDA of $0.9 million in the fourth quarter of 2024 was flat versus adjusted EBITDA of $0.9 million in the fourth quarter of 2023. For full year 2024, Asia Pacific revenue of $86.7 million decreased 16% and adjusted net revenue of $29.4 million decreased 12% compared to 2023. EBITDA for full year 2024 was $0.5 million, compared to EBITDA of $5.9 million in 2023. Adjusted EBITDA for full year 2024 was $2.4 million versus $7.6 million in 2023. Europe, Middle East, and Africa ("EMEA") EMEA revenue of $6.3 million increased 7% and adjusted net revenue of $3.8 million increased 5% in the fourth quarter of 2024 compared to the fourth quarter of 2023. EBITDA loss was $0.2 million in the fourth quarter of 2024, compared to EBITDA of $0.6 million in the same period one year ago. Adjusted EBITDA was $0.2 million in the fourth quarter of 2024 compared to $0.6 million a year ago. For full year 2024, EMEA revenue of $25.5 million decreased 5% and adjusted net revenue of $15.6 million decreased 8% compared to 2023. EBITDA was $0.3 million for full year 2024 compared to $1.6 million in 2023. Adjusted EBITDA was $1.0 million for full year 2024 compared to adjusted EBITDA of $2.4 million in 2023. Corporate Costs The Company's corporate costs of $0.6 million for the fourth quarter of 2024 excluded $0.0 million of non-recurring expenses. This compares to corporate costs of $0.7 million in the fourth quarter of 2023, which excluded $0.2 million of non-recurring expenses. The Company's corporate costs of $3.4 million for the year ended 2024 excluded $0.9 million of non-recurring expenses. This compares to corporate costs of $3.7 million for the year ended 2023, which excluded $0.7 million of non-recurring expenses. Liquidity and Capital Resources The Company ended the fourth quarter of 2024 with $17.7 million in cash, including $0.7 million in restricted cash. The Company generated $2.0 million in cash flow from operations in the fourth quarter of 2024 compared to $3.3 million in the fourth quarter of 2023. For the full year, the company used $2.8 million in cash flow from operations compared to generating $0.3 million in cash flow from operations in 2023. Share Repurchase Program As a reminder, the Company approved a $5 million common stock share repurchase program, effective August 8, 2023. In 2024, the Company purchased 154,084 shares for $2.5 million under this program and has $2.1 million remaining. The Company continues to view share repurchases as an attractive use of capital. NOL Carryforward As of December 31, 2024, Hudson Global had $240 million of usable net operating losses (“NOL”) in the U.S., which the Company considers to be a very valuable asset for its stockholders. In order to protect the value of the NOL for all stockholders, the Company has a rights agreement and charter amendment in place that limit beneficial ownership of Hudson Global common stock to 4.99%. Stockholders who wish to own more than 4.99% of Hudson Global common stock, or who already own more than 4.99% of Hudson Global common stock and wish to buy more, may only acquire additional shares with the Board’s prior written approval. Conference Call/Webcast The Company will conduct a conference call today, March 14, 2025, at 10:00 a.m. ET to discuss this announcement. Individuals wishing to listen can access the webcast on the investor information section of the Company's web site at hudsonrpo.com. If you wish to join the conference call, please use the dial-in information below: Toll-Free Dial-In Number: (833) 816-1383International Dial-In Number: (412) 317-0476 The archived call will be available on the investor information section of the Company's web site at hudsonrpo.com. About Hudson Global Hudson Global, Inc. is a leading global total talent solutions provider operating under the brand name Hudson RPO. We deliver innovative, customized recruitment outsourcing and total talent solutions to organizations worldwide. Through our consultative approach, we develop tailored talent solutions designed to meet our clients’ strategic growth initiatives. As a trusted advisor, we meet our commitments, deliver quality and value, and strive to exceed expectations. For more information, please visit us at hudsonrpo.com or contact us at ir@hudsonrpo.com. Investor Relations:The Equity GroupLena Cati212 836-9611 / lcati@equityny.com Forward-Looking Statements This press release contains statements that the Company believes to be "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact included in this press release, including statements regarding the Company's future financial condition, results of operations, business operations and business prospects, are forward-looking statements. Words such as “anticipate,” "estimate," "expect," "project," "intend," "plan," "predict," "believe" and similar words, expressions and variations of these words and expressions are intended to identify forward-looking statements. All forward-looking statements are subject to important factors, risks, uncertainties, and assumptions, including industry and economic conditions that could cause actual results to differ materially from those described in the forward-looking statements. Such factors, risks, uncertainties and assumptions include, but are not limited to, global economic fluctuations; the Company’s ability to successfully achieve its strategic initiatives ; risks related to potential acquisitions or dispositions of businesses by the Company; the Company’s ability to operate successfully as a company focused on its RPO business; risks related to fluctuations in the Company’s operating results from quarter to quarter due to various factors such as rising inflationary pressures and interest rates; the loss of or material reduction in our business with any of the Company’s largest customers; the ability of clients to terminate their relationship with the Company at any time; competition in the Company’s markets; the negative cash flows and operating losses that may recur in the future; risks relating to how future credit facilities may affect or restrict our operating flexibility; risks associated with the Company’s investment strategy; risks related to international operations, including foreign currency fluctuations, political events, trade wars, natural disasters or health crises, including the Russia-Ukraine war, and potential conflict in the Middle East; the Company’s dependence on key management personnel; the Company’s ability to attract and retain highly skilled professionals, management, and advisors; the Company’s ability to collect accounts receivable; the Company’s ability to maintain costs at an acceptable level; the Company’s heavy reliance on information systems and the impact of potentially losing or failing to develop technology; risks related to providing uninterrupted service to clients; the Company’s exposure to employment-related claims from clients, employers and regulatory authorities, current and former employees in connection with the Company’s business reorganization initiatives, and limits on related insurance coverage; the Company’s ability to utilize net operating loss carryforwards; volatility of the Company’s stock price; the impact of government regulations and deregulation efforts; restrictions imposed by blocking arrangements; risks related to the use of new and evolving technologies; and the adverse impacts of cybersecurity threats and attacks. Additional information concerning these, and other factors is contained in the Company's filings with the Securities and Exchange Commission. These forward-looking statements speak only as of the date of this document. The Company assumes no obligation, and expressly disclaims any obligation, to update any forward-looking statements, whether as a result of new information, future events or otherwise. Financial Tables Follow HUDSON GLOBAL, INC.CONSOLIDATED STATEMENTS OF OPERATIONS(in thousands, except per share amounts)(unaudited)         Three Months Ended Year Ended December 31, December 31,  2024   2023   2024   2023Revenue$33,600  $33,971  $140,056  $161,338        Operating expenses:       Direct contracting costs and reimbursed expenses 15,996   17,421   69,904   81,071Salaries and related 13,910   13,653   58,309   62,859Office and general 2,539   2,924   10,703   10,915Marketing and promotion 961   849   3,588   3,643Depreciation and amortization 319   391   1,361   1,467Total operating expenses 33,725   35,238   143,865   159,955Operating (loss) income (125)  (1,267)  (3,809)  1,383Non-operating income (expense):       Interest income, net 80   88   360   372Other income (expense), net 297   1,134   (21)  813Income (loss) before income taxes 252   (45)  (3,470)  2,568Provision for (benefit from) income taxes 837   (778)  1,300   370Net (loss) income$(585) $733  $(4,770) $2,198(Loss) earnings per share:       Basic$(0.20) $0.24  $(1.59) $0.72Diluted$(0.20) $0.23  $(1.59) $0.70Weighted-average shares outstanding:       Basic 2,974   3,072   3,000   3,064Diluted 2,974   3,158   3,000   3,140                 HUDSON GLOBAL, INC.CONSOLIDATED BALANCE SHEETS(in thousands, except per share amounts)(unaudited)     December 31,2024 December 31,2023ASSETS   Current assets:   Cash and cash equivalents$17,011  $22,611 Accounts receivable, less allowance for expected credit losses of $391 and $378, respectively 20,093   19,710 Restricted cash, current 476   354 Prepaid and other 2,560   3,172 Total current assets 40,140   45,847 Property and equipment, net of accumulated depreciation of $1,668 and $1,564, respectively 242   421 Operating lease right-of-use assets 1,024   1,431 Goodwill 5,703   5,749 Intangible assets, net of accumulated amortization of $3,897 and $2,771, respectively 2,491   3,628 Deferred tax assets 2,648   3,360 Restricted cash 180   205 Other assets 155   317 Total assets$52,583  $60,958 LIABILITIES AND STOCKHOLDERS’ EQUITY   Current liabilities:   Accounts payable$1,789  $868 Accrued salaries, commissions, and benefits 4,306   4,939 Accrued expenses and other current liabilities 4,504   4,635 Operating lease obligations, current 623   768 Total current liabilities 11,222   11,210 Income tax payable 93   87 Operating lease obligations 441   664 Other liabilities 399   443 Total liabilities 12,155   12,404 Commitments and contingencies   Stockholders’ equity:   Preferred stock, $0.001 par value, 10,000 shares authorized; none issued or outstanding —   — Common stock, $0.001 par value, 20,000 shares authorized; 4,033 and 3,896 shares issued; 2,750 and 2,807 shares outstanding, respectively 4   4 Additional paid-in capital 494,209   493,036 Accumulated deficit (430,017)  (425,247)Accumulated other comprehensive loss, net of applicable tax (2,717)  (1,290)Treasury stock, 1,283 and 1,089 shares, respectively, at cost (21,051)  (17,949)Total stockholders’ equity 40,428   48,554 Total liabilities and stockholders' equity$52,583  $60,958    HUDSON GLOBAL, INC.SEGMENT ANALYSIS - QUARTER TO DATE(in thousands)(unaudited)           For The Three Months Ended December 31, 2024 Americas Asia Pacific EMEA Corporate TotalRevenue, from external customers $7,350  $19,986 $6,264  $—  $33,600 Adjusted net revenue, from external customers (1) $6,361  $7,396 $3,847  $—  $17,604 Net loss         $(585)Provision for income taxes          837 Interest income, net          (80)Depreciation and amortization          319 EBITDA (loss) (2) $450  $547 $(161) $(345)  491 Non-operating expense (income), including corporate administration charges  (100)  131  82   (410)  (297)Stock-based compensation expense  66   63  39   66   234 Non-recurring severance and professional fees  (19)  183  228   41   433 Adjusted EBITDA (loss) (2) $397  $924 $188  $(648) $861            For The Three Months Ended December 31, 2023 Americas Asia Pacific EMEA Corporate TotalRevenue, from external customers $6,246  $22,073 $5,652  $—  $33,971 Adjusted net revenue, from external customers (1) $6,044  $6,941 $3,565  $—  $16,550 Net income         $733 Benefit from income taxes          (778)Interest income, net          (88)Depreciation and amortization          391 EBITDA (loss) (2) $172  $404 $587  $(905)  258 Non-operating expense (income), including corporate administration charges  (963)  187  (87)  (271)  (1,134)Stock-based compensation expense  66   85  50   281   482 Non-recurring severance and professional fees  —   264  32   165   461 Adjusted EBITDA (loss) (2) $(725) $940 $582  $(730) $67   Represents Revenue less the Direct contracting costs and reimbursed expenses caption on the Consolidated Statements of Operations.Non-GAAP earnings before interest, income taxes, and depreciation and amortization (“EBITDA”) and non-GAAP earnings before interest, income taxes, depreciation and amortization, non-operating income (expense), stock-based compensation expense, and other non-recurring severance and professional fees (“Adjusted EBITDA”) are presented to provide additional information about the Company's operations on a basis consistent with the measures which the Company uses to manage its operations and evaluate its performance. Management also uses these measurements to evaluate capital needs and working capital requirements. EBITDA and Adjusted EBITDA should not be considered in isolation or as a substitute for operating income, cash flows from operating activities, and other income or cash flow statement data prepared in accordance with generally accepted accounting principles or as a measure of the Company's profitability or liquidity. Furthermore, EBITDA and Adjusted EBITDA as presented above may not be comparable with similarly titled measures reported by other companies.  HUDSON GLOBAL, INC.SEGMENT ANALYSIS - YEAR TO DATE(in thousands)(unaudited)           For The Year Ended December 31, 2024 Americas Asia Pacific EMEA Corporate TotalRevenue, from external customers $27,894  $86,704 $25,458 $—  $140,056 Adjusted net revenue, from external customers (1) $25,144  $29,416 $15,592 $—  $70,152 Net loss         $(4,770)Provision for income taxes          1,300 Interest income, net          (360)Depreciation and amortization          1,361 EBITDA (loss) (2) $339  $482 $298 $(3,588)  (2,469)Non-operating expense (income), including corporate administration charges  225   733  250  (1,187)  21 Stock-based compensation expense  232   400  183  465   1,280 Non-recurring severance and professional fees  143   797  250  881   2,071 Adjusted EBITDA (loss) (2) $939  $2,412 $981 $(3,429) $903            For The Year Ended December 31, 2023 Americas Asia Pacific EMEA Corporate TotalRevenue, from external customers $31,254  $103,857 $26,227 $—  $161,338 Adjusted net revenue, from external customers (1) $30,141  $33,675 $16,451 $—  $80,267 Net income         $2,198 Provision for income taxes          370 Interest income, net          (372)Depreciation and amortization          1,467 EBITDA (loss) (2) $(704) $5,859 $1,582 $(3,074)  3,663 Non-operating expense (income),including corporate administration charges  (528)  1,181  436  (1,902)  (813)Stock-based compensation expense  407   232  216  614   1,469 Non-recurring severance and professional fees  105   292  156  658   1,211 Compensation expense related to acquisitions (3)  338   —  —  —   338 Adjusted EBITDA (loss) (2) $(382) $7,564 $2,390 $(3,704) $5,868   Represents Revenue less the Direct contracting costs and reimbursed expenses caption on the Consolidated Statements of Operations.Non-GAAP earnings before interest, income taxes, and depreciation and amortization (“EBITDA”) and non-GAAP earnings before interest, income taxes, depreciation and amortization, non-operating (income) expense, stock-based compensation expense, and other non-recurring severance and professional fees (“Adjusted EBITDA”) are presented to provide additional information about the Company's operations on a basis consistent with the measures which the Company uses to manage its operations and evaluate its performance. Management also uses these measurements to evaluate capital needs and working capital requirements. EBITDA and Adjusted EBITDA should not be considered in isolation or as a substitute for operating income, cash flows from operating activities, and other income or cash flow statement data prepared in accordance with generally accepted accounting principles or as a measure of the Company's profitability or liquidity. Furthermore, EBITDA and Adjusted EBITDA as presented above may not be comparable with similarly titled measures reported by other companies.Represents compensation expense payable per the terms of acquisition agreements. HUDSON GLOBAL, INC.RECONCILIATION FOR CONSTANT CURRENCY(in thousands)(unaudited) The Company operates on a global basis, with the majority of its revenue generated outside of the United States. Accordingly, fluctuations in foreign currency exchange rates can affect its results of operations. Constant currency information compares financial results between periods as if exchange rates had remained constant period-over-period. The company currently defines the term “constant currency” to mean that financial data for a previously reported period are translated into U.S. dollars using the same foreign currency exchange rates that were used to translate financial data for the current period. Changes in revenue, adjusted net revenue, selling, general and administrative expenses ("SG&A"), and other non-operating income (expense), operating income (loss) and EBITDA (loss) include the effect of changes in foreign currency exchange rates. Variance analysis usually describes period-to-period variances that are calculated using constant currency as a percentage. The company’s management reviews and analyzes business results in constant currency and believes these results better represent the company’s underlying business trends. The company believes that these calculations are a useful measure, indicating the actual change in operations. There are no significant gains or losses on foreign currency transactions between subsidiaries. Therefore, changes in foreign currency exchange rates generally impact only reported earnings.  For The Three Months Ended December 31,  2024       2023      As As Currency Constant reported reported translation currencyRevenue:       Americas$7,350  $6,246  $(9) $6,237 Asia Pacific 19,986   22,073   147   22,220 EMEA 6,264   5,652   179   5,831 Total$33,600  $33,971  $317  $34,288 Adjusted net revenue (1):       Americas$6,361  $6,044  $(9) $6,035 Asia Pacific 7,396   6,941   10   6,951 EMEA 3,847   3,565   109   3,674 Total$17,604  $16,550  $110  $16,660 SG&A (2):       Americas$6,075  $6,929  $(23) $6,906 Asia Pacific 6,655   6,290   14   6,304 EMEA 3,922   3,050   102   3,152 Corporate 758   1,157   1   1,158 Total$17,410  $17,426  $94  $17,520 Operating (loss) income:       Americas$78  $(1,137) $(1) $(1,138)Asia Pacific 644   556   (3)  553 EMEA (86)  492   5   497 Corporate (761)  (1,178)  —   (1,178)Total$(125) $(1,267) $1  $(1,266)EBITDA (loss):       Americas$450  $172  $(2) $170 Asia Pacific 547   404   (14)  390 EMEA (161)  587   6   593 Corporate (345)  (905)  —   (905)Total$491  $258  $(10) $248   Represents Revenue less the Direct contracting costs and reimbursed expenses caption on the Consolidated Statements of Operations.SG&A is a measure that management uses to evaluate the segments’ expenses and includes salaries and related costs, office and general costs, and marketing and promotion costs.  HUDSON GLOBAL, INC.RECONCILIATION FOR CONSTANT CURRENCY (continued)(in thousands)(unaudited)  For The Year Ended December 31,  2024       2023      As As Currency Constant reported reported translation currencyRevenue:       Americas$27,894  $31,254  $(26) $31,228 Asia Pacific 86,704   103,857   (608)  103,249 EMEA 25,458   26,227   659   26,886 Total$140,056  $161,338  $25  $161,363 Adjusted net revenue (1):       Americas$25,144  $30,141  $(21) $30,120 Asia Pacific 29,416   33,675   (226)  33,449 EMEA 15,592   16,451   415   16,866 Total$70,152  $80,267  $168  $80,435 SG&A (2):       Americas$24,786  $31,699  $(79) $31,620 Asia Pacific 27,974   26,427   (205)  26,222 EMEA 15,063   14,350   372   14,722 Corporate 4,777   4,941   —   4,941 Total$72,600  $77,417  $88  $77,505 Operating (loss) income:       Americas$(598) $(2,514) $(4) $(2,518)Asia Pacific 1,055   6,894   (18)  6,876 EMEA 521   1,988   41   2,029 Corporate (4,787)  (4,985)  —   (4,985)Total$(3,809) $1,383  $19  $1,402 EBITDA (loss):       Americas$339  $(704) $(7) $(711)Asia Pacific 482   5,859   (43)  5,816 EMEA 298   1,582   30   1,612 Corporate (3,588)  (3,074)  —   (3,074)Total$(2,469) $3,663  $(20) $3,643   Represents Revenue less the Direct contracting costs and reimbursed expenses caption on the Consolidated Statements of Operations.SG&A is a measure that management uses to evaluate the segments’ expenses and includes salaries and related costs, office and general costs, and marketing and promotion costs.  HUDSON GLOBAL, INC.RECONCILIATION OF ADJUSTED NET INCOME PER DILUTED SHARE(in thousands, except per share amounts)(unaudited)   Adjusted Diluted Shares Per DilutedFor The Three Months Ended December 31, 2024 Net Loss Outstanding Share (1)Net loss $(585) 2,974 $(0.20)Non-recurring severance, professional fees, and other (after tax)  438  2,974  0.15 Compensation expense related to acquisitions (after tax) (2)  —  2,974  — Adjusted net loss (3) $(147) 2,974 $(0.05)   Adjusted Diluted Shares Per DilutedFor The Three Months Ended December 31, 2023 Net Income Outstanding ShareNet income $733  3,158 $0.23 Non-recurring severance and professional fees (after tax)  (617) 3,158  (0.19)Compensation expense related to acquisitions (after tax) (2)  —  3,158  — Adjusted net income (3) $116  3,158 $0.04    Adjusted Diluted Shares Per DilutedFor The Year Ended December 31, 2024 Net Loss Outstanding ShareNet loss $(4,770) 3,000 $(1.59)Non-recurring severance, professional fees, and other (after tax)  2,178  3,000  0.73 Compensation expense related to acquisitions (after tax) (2)  —  3,000  — Adjusted net loss (3) $(2,592) 3,000 $(0.86)   Adjusted Diluted Shares Per DilutedFor The Year Ended December 31, 2023 Net Income Outstanding ShareNet income $2,198  3,140 $0.70 Non-recurring severance and professional fees (after tax)  133  3,140  0.04 Compensation expense related to acquisitions (after tax) (2) $356  3,140  0.11 Adjusted net income (3) $2,687  3,140 $0.86   1.   Amounts may not sum due to rounding. 2.   Represents compensation expense payable per the terms of the Coit acquisition, including a promissory note for $1.35 million payable over three years, and $500k of the Company's common stock vesting over 30 months. 3.   Adjusted net income or loss per diluted share are Non-GAAP measures defined as reported net income or loss and reported net income or loss per diluted share before items such as acquisition-related costs and non-recurring severance and professional fees after tax that are presented to provide additional information about the Company's operations on a basis consistent with the measures that the Company uses to manage its operations and evaluate its performance. Management also uses these measurements to evaluate capital needs and working capital requirements. Adjusted net income or loss per diluted share should not be considered in isolation or as substitutes for net income or loss and net income or loss per share and other income or cash flow statement data prepared in accordance with generally accepted accounting principles or as measures of the Company's profitability or liquidity. Further, adjusted net income or loss and adjusted net income or loss per diluted share as presented above may not be comparable with similarly titled measures reported by other companies.

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