Usio, Inc. Segments Disclosure

Note 10. Segment Reporting

 

Usio's reportable operating segments are "Output Solutions" and "Merchant Services" and these segments have been selected based on management’s resource allocation and performance assessment in making decisions regarding the Company. Our chief operating decision maker ("CODM") is the Company’s chief executive officer. The CODM has ultimate authority and responsibility over resource allocation decisions and performance assessment.

 

Segment gross profit is the measure of segment profit and loss reviewed by the CODM and is used by the CODM to evaluate segment performance and make decisions about funding our operations and allocating resources.

 

The following is a description of the segments.

 

Output Solutions

 

This segment, which was created in connection with the acquisition of substantially all of the assets of IMS, offers electronic bill presentment, document composition, document decomposition and printing and mailing services serving hundreds of customers representing a wide range of industry verticals, including utilities and financial institutions. Output Solutions, provides an outsourced solution for document design, print, and electronic delivery to potential customers and entities looking to reduce postage costs and increase efficiencies.

 

Merchant Services

 

This segment offers integrated electronic payment processing services to merchants and businesses, including credit and debit card-based processing services and electronic funds transfer via the ACH network. Additionally, as part of our Prepaid card-based processing services, we develop and manage a variety of Mastercard-branded prepaid card program types, including consumer reloadable, consumer gift, incentive, promotional, general and government disbursement and corporate expense cards.

 

The following tables set forth certain financial information with respect to Usio’s reportable segments for the twelve months ended December 31, 2025 and 2024:

 

For the Year Ended December 31, 2025		Output Solutions				Merchant Services				Total
Revenues		$	20,816,303			$	64,577,323			$	85,393,626
Cost of services
Processing expense			—				48,896,184				48,896,184
Services expense			2,480,472				—				2,480,472
Postage expense			14,324,271				—				14,324,271
Cost of services			16,804,743				48,896,184				65,700,927
Gross profit		$	4,011,560			$	15,681,139			$	19,692,699
Depreciation and amortization		$	944,225			$	1,001,999			$	1,946,224
Capital expenditures		$	103,780			$	331,234			$	435,014
Identifiable assets1		$	4,376,501			$	7,950,143			$	12,326,644
For the Year Ended December 31, 2024		Output Solutions				Merchant Services				Total
Revenues		$	20,769,924			$	62,161,916			$	82,931,840
Cost of services
Processing expense			—				46,897,136				46,897,136
Services expense			3,576,677				—				3,576,677
Postage expense			12,843,583				—				12,843,583
Cost of services			16,420,260				46,897,136				63,317,396
Gross profit		$	4,349,664			$	15,264,780			$	19,614,444
Depreciation and amortization		$	1,269,393			$	993,909			$	2,263,302
Capital expenditures		$	21,515			$	174,362			$	195,877
Identifiable assets1		$	5,176,438			$	7,395,089			$	12,571,527

 

Note to tables:

(1)

Identifiable assets is calculated by summing the balances of accounts receivable, net; inventory; property and equipment, net; operating lease right-of-use lease assets; and intangibles, net.

 

The following table reconciles segment profit reported above to the loss from operations reported in the consolidated statements of operations for the twelve months ended December 31, 2025 and 2024:

 

		Year Ended December 31,
		2025				2024
Segment gross profit		$	19,692,699			$	19,614,444
Stock-based compensation			(1,743,893	)			(2,093,406	)
Selling, general and administrative ("SG&A")			(18,362,187	)			(16,728,081	)
Depreciation and amortization			(1,946,224	)			(2,263,302	)
Operating (loss)		$	(2,359,605	)		$	(1,470,345	)