IDT Corporation

Good evening and welcome to the IDT Corporation's first quarter fiscal year 2025 earnings call. In today's presentation, IDT's management will discuss IDT's financial and operational results for the three-month period ended October 31, 2024. During prepared remarks by IDT's Chief Executive Officer, Shmuel Jones, all participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After Mr. Jonas' remarks, Marcelo Fisher, IDT's Chief Financial Officer, will join Mr. Jonas for Q&A with investors. Any forward-looking statement made during this conference call, either in the prepared remarks or in the Q&A session, whether general or specific in nature, are subject to risk and uncertainties that may cause actual results to differ materially from those which the company anticipates. These risks and uncertainties include, but are not limited to, specific risks and uncertainties discussed in the reports that IDT files periodically with the SEC. IDT assumes no obligation either to update any forward-looking statements that they have made or may make, or to update the factors that may cause actual results to differ materially from those that they forecast. In their presentation or in the Q&A session, IDT's management may make reference to non-GAAP measures, including adjusted EBITDA, non-GAAP net income, and non-GAAP earnings per share. A schedule provided in the IDT earnings release reconciles adjusted EBITDA, non-GAAP net income, and non-GAAP earnings per share to the nearest corresponding GAAP measures. Please note that the IDT earnings release is available on the investor relations page of the IDT Corporation website. The earnings release has also been filed on a Form 8K with the SEC. I will now turn the conference over to Mr. Jonas.

Thank you, John. I apologize for my voice. Welcome to IDT's earnings conference call. My remarks today focus on the first quarter of our fiscal year 2025. The three and 12 months ended October 31st. For more detailed discussion of our financial and operational results for the quarter, please read our earnings release held earlier today and our Form 10-K that we expect to file with the SEC next Tuesday. Building on our momentum from fiscal 2024, IDT delivered strong financial results in the first quarter of fiscal 2025, including record levels of gross profit, gross profit margin, and adjusted EBITDA. Consolidated revenue has now increased sequentially for three consecutive quarters. NRS, along with our FinTech segment powered by Boss Money and NetPhone, each achieved robust increases in revenue, gross profit, and adjusted EBITDA. At NRS, we are focused on providing solutions to address the needs of our independent retailer market, while heavily investing to develop new products and services to broaden our addressable markets. In Q1, we continue to achieve increased adoption rates on our payment processing offerings and SAS feature plans. We look forward to continuing this momentum through the remainder of the fiscal year. Boss Money's Q1 results reflected our decision to enhance margins, particularly within our retail channel. As a result, Boss Money's gross margin expanded significantly and transaction growth slowed somewhat. The enhanced margins boosted FinTech's Q1 income from operations by $4.6 million year-over-year, and in November, following the quarter's close, transaction growth rebounded, led by DTC. NetFone increased seats served to over 400,000, driving a 13% increase in subscription revenue, despite the negative FX impact to its Latin American operations from a strong U.S. dollar. NetFone's financial discipline also contributed to healthy increases in income from operations and adjusted EBITDA. In the traditional communications segment, our partners have streamlined their units, improved their economics, and that continued to pay off in Q1. The year-over-year revenue decrease was 4%, while income from operations increased by 2%. In light of the strong financial performance across our key businesses this quarter, we are now on track to significantly beat the EBITDA projections that we previously had. I'll wrap by wishing the entire ID team, including all of our colleagues across the globe, retail partners, and investors a very joyous holiday season. shared with family and friends. We very much appreciate your support and hard work and look forward to sharing more good IDT news with you in 2025. Now Marcel and I will be happy to take your questions.

We will now begin the question and answer session. To ask a question, you may press star then one on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the star keys. To withdraw your question, please press star then two. We will now pause momentarily to assemble our roster. OK, your first question comes from . Please announce your affiliation, then pose your question.