Asure Software’s third quarter results showed broad-based revenue growth, with management attributing gains to increased demand across payroll, HR, and tax management solutions. CEO Pat Goepel highlighted the launch of Asure Central and stronger cross-selling momentum as key contributors, noting a sequential improvement in organic growth. The company’s recent Lathem Time acquisition also supported growth, especially in hardware and professional services. Management cited robust client interest in bundled offerings and ongoing investments in technology integration. Despite these positive operational developments, GAAP losses widened, which CFO John Pence explained was partly due to an increased mix of lower-margin nonrecurring sales.
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Asure Software (ASUR) Q3 CY2025 Highlights:
- Revenue: $36.25 million vs analyst estimates of $35.69 million (23.7% year-on-year growth, 1.6% beat)
- Adjusted EPS: $0.14 vs analyst expectations of $0.21 (30.5% miss)
- Adjusted Operating Income: $8.11 million vs analyst estimates of -$655,830 (22.4% margin, significant beat)
- Revenue Guidance for Q4 CY2025 is $39 million at the midpoint, above analyst estimates of $38.12 million
- EBITDA guidance for Q4 CY2025 is $11 million at the midpoint, in line with analyst expectations
- Operating Margin: -9.7%, up from -12.4% in the same quarter last year
- Billings: $39.25 million at quarter end, up 38.4% year on year
- Market Capitalization: $228.8 million
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Asure Software’s Q3 Earnings Call
- Joshua Reilly (Needham & Co.) asked about the assumptions behind 2026 organic growth and future acquisition pace. CFO John Pence clarified that the outlook primarily reflects organic growth from existing acquisitions, with no extraordinary deals modeled, and that the balance sheet supports opportunistic future M&A.
- Joshua Reilly (Needham & Co.) followed up on the drivers of cross-sell versus new client growth. CEO Pat Goepel highlighted a 7% quarter-over-quarter cross-sell improvement, emphasizing increased adoption of bundled solutions and the expected positive impact of Asure Central.
- Jared Levine (TD Cowen) inquired about sales cycles and pipeline views across segments. Goepel stated that sales cycles in the small and medium business market remain stable, with strong pipeline growth and plans to increase marketing investment in 2026.
- Eric Martinuzzi (Lake Street) asked about Lathem Time’s recurring revenue contribution and integration progress. Pence indicated recurring revenue from Lathem is predictable, with bundled offerings expected to further increase cross-selling opportunities.
- Richard Baldry (ROTH Capital Partners) questioned cost efficiencies from Asure Central. Goepel responded that newer products are reducing maintenance costs, with full integration of Lathem into Asure Central targeted within months.
Catalysts in Upcoming Quarters
In upcoming quarters, the StockStory team will be closely monitoring (1) the adoption rate and client feedback from the Asure Central platform rollout, (2) progress in integrating Lathem Time and realizing expected cross-sell synergies, and (3) the company’s ability to sustain organic growth while moving toward GAAP profitability. We will also track any shifts in interest rates or macroeconomic conditions that could influence client budgets or float revenue.
Asure Software currently trades at $8.10, in line with $8.15 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free for active Edge members).
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