"SendTech is larger and more profitable, but declining fairly rapidly (accelerating from 2-3% per year to 8%)"
Context on the sendtech decline, from the last earnings release, and why the decline could moderate.
SendTech Results: During the quarter, SendTech revenue was down 8% primarily due to the IMI
migration having bolstered sales in the first half of 2024. We expect materially lower year-over-year revenue declines in the second half of 2025 based on easier comparisons (the number of trade-up transactions declined 40% from the first half of 2024 to the second half of 2024).
It is important to note that we began consciously prioritizing postage meter lease renewals roughly a year ago. We made this change because, despite generating lower upfront revenue, lease renewals are more profitable over their life due to the absence of associated cost of goods sold for the new device. As a result, lease renewal revenue was up more than 20% year over year in the second
quarter. We expect lease renewals to continue to build as a top- and bottom-line tailwind for SendTech.
Also - the company announced an increase in their revolver today. Between the untapped revolver and proceeds from the recent convert sale, they have $530m plus in available liquidity.
"SendTech is larger and more profitable, but declining fairly rapidly (accelerating from 2-3% per year to 8%)"
Context on the sendtech decline, from the last earnings release, and why the decline could moderate.
SendTech Results: During the quarter, SendTech revenue was down 8% primarily due to the IMI
migration having bolstered sales in the first half of 2024. We expect materially lower year-over-year revenue declines in the second half of 2025 based on easier comparisons (the number of trade-up transactions declined 40% from the first half of 2024 to the second half of 2024).
It is important to note that we began consciously prioritizing postage meter lease renewals roughly a year ago. We made this change because, despite generating lower upfront revenue, lease renewals are more profitable over their life due to the absence of associated cost of goods sold for the new device. As a result, lease renewal revenue was up more than 20% year over year in the second
quarter. We expect lease renewals to continue to build as a top- and bottom-line tailwind for SendTech.
Thanks! Declines were very consistent for several years and it sounds like they should trend back that way
Also - the company announced an increase in their revolver today. Between the untapped revolver and proceeds from the recent convert sale, they have $530m plus in available liquidity.