CREATIVE REALITIES, INC.

CREX

Business Summary

Creative Realities, Inc. (CREX) provides digital signage and media solutions across North America, targeting various out-of-home environments including retail, entertainment and sports venues, restaurants (QSR), convenience stores, financial services, automotive, lottery, mixed-use developments, and Digital Out of Home (DOOH) advertising networks. The company's business model revolves around assisting enterprise customers in designing, deploying, managing, and monetizing their digital signage and in-store retail media networks. CREX emphasizes a "single vendor" approach, offering a full portfolio of products and services from design to day-two support, and highlights competitive advantages such as a managed labor pool, in-house creative resources, network scalability and reliability, proprietary AdTech platforms (AdLogic and CPM+), market sector expertise, logistics, technical support via its Network Operations Center (NOC) in Louisville, Kentucky, flexible hardware support, and ownership of the largest mall shopping network in Canada.

The company generates revenue from three primary sources: hardware sales, services revenue, and recurring subscription licensing and support revenue from its digital signage software platforms, which are generally sold via a Software-as-a-Service (SaaS) model. Hardware sales involve reselling digital signage hardware from original equipment manufacturers like Samsung and BrightSign. Services revenue encompasses hardware system design/engineering, installation, content development and scheduling, post-deployment network and field support, and AdTech for advertising and content trafficking. Recurring SaaS revenue is derived from platforms such as ReflectView (core digital signage), Reflect Xperience (web-based content scheduling), AdLogic (AdTech management, delivering approximately 50 million ads daily ¹), CPM+ (demand and supply side platform for programmatic advertising), Clarity (digital menu board solutions), and iShowroomProX (omni-channel digital sales support for the transportation sector). While hardware sales and support services can fluctuate, the company is focused on increasing recurring SaaS revenue.

For the fiscal year ended December 31, 2025, Creative Realities reported total sales of $57,232 thousand ², an increase of 12.5% ³ from $50,854 thousand ⁴ in 2024. Hardware revenues grew by 16.3% ⁵ to $21,232 thousand ⁶ from $18,259 thousand ⁷ in the prior year, driven by QSR and sports/entertainment verticals and the Cineplex Digital Media (CDM) acquisition. Services and other revenues increased by 10.4% ⁸ to $36,000 thousand ⁹ from $32,595 thousand ¹⁰ in 2024. The CDM acquisition contributed $13,613 thousand ¹¹ in total revenue post-acquisition (November 7, 2025, through December 31, 2025), offsetting a $9,000 thousand ¹² decline in legacy CRI service revenues due to fewer deployments, an exit from the media business effective October 1, 2024, and lower SaaS subscription revenues.

Gross profit for 2025 increased by 7% ¹³ to $25,714 thousand ¹⁴ from $24,011 thousand ¹⁵ in 2024. However, the gross margin percentage decreased to 44.9% ¹⁶ from 47.2% ¹⁷, primarily due to the inclusion of CDM with its different revenue and cost mix, and a shift towards higher-volume, lower-margin hardware deployments within legacy CRI. Operating expenses significantly increased by 49.9% ¹⁸ to $34,580 thousand ¹⁹ from $23,073 thousand ²⁰ in 2024, leading to an operating loss of $8,866 thousand ²¹ compared to an operating income of $938 thousand ²² in the prior year. This increase was mainly due to a $5,712 thousand ²³ impairment charge on a proprietary software asset, $2,182 thousand ²⁴ in stock-based compensation expense, and $3,992 thousand ²⁵ in incremental general and administrative costs from CDM, partially offset by $1,251 thousand ²⁶ in cost containment efforts in legacy CRI.

The company reported a net loss of $8,276 thousand ²⁷ for 2025, a 135.9% ²⁸ increase from a net loss of $3,508 thousand ²⁹ in 2024. Basic and diluted loss per common share was $(0.81) ³⁰ for 2025, compared to $(0.34) ³¹ for 2024. Net cash used in operating activities was $7,750 thousand ³² in 2025, a significant shift from net cash provided by operating activities of $3,381 thousand ³³ in 2024. Cash and cash equivalents stood at $1,559 thousand ³⁴ as of December 31, 2025, up from $1,037 thousand ³⁵ in 2024. Total debt, net of debt issuance costs, was $43,953 thousand ³⁶ at year-end 2025, compared to $13,044 thousand ³⁷ in 2024. The company also had an accumulated deficit of $65,130 thousand ³⁸ and negative working capital of $5,728 thousand ³⁹ as of December 31, 2025.

Significant operational developments during the period include the acquisition of DDC Group International, Inc. (CDM) on November 7, 2025, for a final purchase price of approximately CAD $60,263 thousand ⁴⁰ (approximately USD $42,761 thousand ⁴¹). This acquisition expanded CREX's digital signage capabilities and geographic presence into Canada, providing access to CDM's SaaS technology platform and diversified customer base. In connection with the CDM acquisition, the company refinanced its credit facilities on November 6, 2025, securing a $36,000 thousand ⁴² term loan and a $22,500 thousand ⁴³ revolving credit facility, both maturing on November 6, 2028 ⁴⁴. Additionally, CREX issued 30,000 shares of Series A Convertible Preferred Stock ⁴⁵ for gross proceeds of $30,000 thousand ⁴⁶ to partially fund the CDM acquisition. The company also settled a contingent consideration liability related to the Reflect acquisition for a gain of $4,775 thousand ⁴⁷, involving a $3,000 thousand ⁴⁸ cash payment, a $4,000 thousand ⁴⁹ subordinated promissory note, and 777,800 shares ⁵⁰ of Settlement Warrants.

Business Outlook

Management's specific revenue, margin, or EPS guidance for the upcoming period is not explicitly stated in the filing. However, the company's ability to generate positive net income and cash flows from operations is reliant on the successful integration and operation of the newly acquired CDM business. Management believes that the completion of the CDM acquisition and its planned integration, along with expected realization of synergies, present an opportunity to prospectively eliminate the conditions giving rise to substantial doubt regarding the Company’s ability to continue as a going concern in future periods ⁵¹.

A major growth area for Creative Realities is the expansion of digital signage adoption and utilization across its served vertical markets, with a particular focus on increasing recurring SaaS revenue. The company believes that the proliferation of in-store retail media networks will serve as an industrial catalyst for infrastructure and AdTech sales, for which it is well-positioned with its current product set and technology stack ⁵². The acquisition of CDM is expected to accelerate growth in targeted vertical and operating markets, enable cost-effective aggregation of multiple customer bases onto a single business and technology platform, provide greater operating scale, and leverage common processes and tools for cost efficiencies, ultimately aiming for higher operating profitability and cash flow ⁵³. The CDM acquisition specifically expands the company's digital signage capabilities and geographic presence into Canada, and provides access to CDM's proprietary SaaS technology platform and diversified recurring-revenue customer base, with anticipated cross-selling synergies ⁵⁴.

Operationally, the company is focusing on streamlining administrative office functions and capitalizing on various marketing programs and activities. With a focus on SaaS revenues, management believes that gross margins will rise as the business scales ⁵⁵. During 2025, the company implemented low-cost restructuring measures and targeted vendor spend reductions, which collectively contributed to a more efficient back-office cost structure. These efforts were supported by the retirement of legacy software platforms and the transition to a unified ERP system, leading to modest improvements in workflow efficiency and systems integration ⁵⁶. The company does not have sufficient capital to engage in material research and development, which management acknowledges may harm long-term growth by potentially causing technology and product offerings to not keep pace with the market ⁵⁷.

Regarding capital allocation, the company refinanced its credit facilities on November 6, 2025, securing a $36,000 thousand ⁵⁸ term loan and a $22,500 thousand ⁵⁹ revolving credit facility, both maturing on November 6, 2028 ⁶⁰. The net proceeds from these activities, along with $30,000 thousand ⁶¹ from the sale of Series A Preferred Stock, were used to pay a portion of the purchase price for the CDM acquisition and to refinance certain indebtedness ⁶². The company has never paid dividends on its common stock and currently intends to retain any future earnings to fund business growth and development ⁶³.

Management explicitly flagged several structural headwinds and execution risks. The company has incurred historical net losses and negative cash flows from operations, with a net loss of $8,276 thousand ⁶⁴ in 2025 and negative working capital of $5,728 thousand ⁶⁵, raising substantial doubt about its ability to continue as a going concern ⁶⁶. The digital marketing business operates in a rapidly changing market, and the company may be unable to timely and successfully develop new technology features, including artificial intelligence (AI), or increase the functionality of existing offerings ⁶⁷. The variable sales cycle of some products makes it difficult to predict operating results, and large individual sales have sometimes occurred later than anticipated or not at all ⁶⁸. The industry is characterized by significant consolidation, and the company's failure to participate actively could adversely impact its access to financing, customers, technology, and human resources ⁶⁹. The anticipated growth opportunities and beneficial synergies from the CDM acquisition may not be fully realized, and the assumption of unknown liabilities in the acquisition could harm financial condition ⁷⁰. The company also faces intense competition from larger, better-funded competitors, some of whom are incorporating AI and machine learning (ML) faster or better ⁷¹.

Geographic, regulatory, and macro factors identified as constraints include the complex and evolving framework of Canadian federal and provincial regulatory requirements for CDM operations, including data privacy (PIPEDA), accessibility (AODA), and French-language laws (Bill 96 in Quebec), non-compliance with which could increase costs and expose the company to penalties ⁷². Fluctuations in the exchange rate between the U.S. dollar and the Canadian dollar could adversely affect financial results, as a significant portion of CDM's revenues, expenses, and assets are denominated in Canadian dollars, and the company does not currently hedge this exposure ⁷³. Geopolitical conflicts, such as those involving Iran, Israel, and the United States, as well as terrorism and other global security threats, could disrupt business operations and impact the ability to access capital ⁷⁴. High inflation and unfavorable economic conditions could lead to decreased consumer confidence and spending, negatively affecting demand for services ⁷⁵. Changes in trade policy, tariffs, and import/export regulations, such as those instituted by the Trump administration, may increase the cost of goods or reduce sales, adversely affecting operating results and financial condition ⁷⁶.

Risk Factors

Creative Realities faces material risks including its history of net losses and negative operating cash flows, with an accumulated deficit of $65,130 thousand ⁷⁷ and negative working capital of $5,728 thousand ⁷⁸ as of December 31, 2025, raising substantial doubt about its ability to continue as a going concern ⁷⁹. The digital marketing industry is rapidly evolving, and the company's limited capital for research and development may hinder its ability to keep pace with technological changes, including the integration of AI and ML, potentially leading to a loss of competitive advantage and market share ⁸⁰. Customer contracts are often short-term or terminable with limited notice, and the loss of key customers, such as the one accounting for 10% ⁸¹ of 2025 revenue or the three customers accounting for 15%, 13%, and 10% ⁸² of 2024 revenue, could severely impact revenue growth and profitability ⁸³. The recent CDM acquisition carries integration risks, potential failure to achieve anticipated synergies, and the assumption of unknown liabilities, which could materially harm financial condition ⁸⁴. The company is also exposed to cybersecurity risks, including potential information theft, data corruption, and operational disruption, which may require additional resource expenditure to enhance protection ⁸⁵. Furthermore, Canadian operations through CDM are subject to a complex regulatory framework, including data privacy, accessibility, and French-language laws, with non-compliance potentially leading to increased costs and penalties ⁸⁶. Fluctuations in the CAD/USD exchange rate could adversely affect reported financial results, as the company does not currently hedge this exposure ⁸⁷. Macroeconomic factors such as high inflation, unfavorable economic conditions, and geopolitical conflicts could negatively impact consumer spending and business operations ⁸⁸.

Management Priorities

Management's message to shareholders conveys a focus on strategic growth through both organic expansion and accretive acquisitions, aiming to leverage the company's scalable business model. They emphasize the successful integration of acquired companies, such as CDM, to accelerate growth in targeted vertical and operating markets, aggregate customer bases onto a single platform, achieve greater operating scale, and realize cost efficiencies for higher operating profitability and cash flow. Management explicitly states that the ability to generate positive net income and cash flows from operations is reliant on the successful integration and operation of the newly acquired CDM business, and believes these actions, along with expected synergies, present the opportunity to prospectively eliminate the conditions giving rise to substantial doubt regarding the Company’s ability to continue as a going concern in future periods ⁸⁹. Key strategic priorities include maintaining and increasing recurring SaaS revenue as digital signage adoption expands, streamlining administrative functions, and capitalizing on marketing initiatives. The company also highlights its in-house expertise, comprehensive solution offerings, and proprietary AdTech platforms as competitive advantages.

View Source Annual Report on SEC.gov ↗

References

[1] Item 1, Business
[2] Item 7, MD&A — Results of Operations
[3] Item 7, MD&A — Sales
[4] Item 7, MD&A — Results of Operations
[5] Item 7, MD&A — Sales
[6] Item 7, MD&A — Results of Operations
[7] Item 7, MD&A — Results of Operations
[8] Item 7, MD&A — Sales
[9] Item 7, MD&A — Results of Operations
[10] Item 7, MD&A — Results of Operations
[11] Item 7, MD&A — Sales
[12] Item 7, MD&A — Sales
[13] Item 7, MD&A — Gross Profit
[14] Item 7, MD&A — Results of Operations
[15] Item 7, MD&A — Results of Operations
[16] Item 7, MD&A — Gross Profit
[17] Item 7, MD&A — Gross Profit
[18] Item 7, MD&A — Total Operating Expenses
[19] Item 7, MD&A — Results of Operations
[20] Item 7, MD&A — Results of Operations
[21] Item 7, MD&A — Results of Operations
[22] Item 7, MD&A — Results of Operations
[23] Item 7, MD&A — Loss on Impairment of Software Asset
[24] Item 7, MD&A — General and Administrative Expenses
[25] Item 7, MD&A — General and Administrative Expenses
[26] Item 7, MD&A — General and Administrative Expenses
[27] Item 7, MD&A — Results of Operations
[28] Item 7, MD&A — Net Loss
[29] Item 7, MD&A — Results of Operations
[30] Item 7, MD&A — Results of Operations
[31] Item 7, MD&A — Results of Operations
[32] Item 7, MD&A — Operating Activities
[33] Item 7, MD&A — Operating Activities
[34] Item 7, MD&A — Liquidity and Capital Resources
[35] Item 7, MD&A — Liquidity and Capital Resources
[36] Item 11, Debt
[37] Item 11, Debt
[38] Item 1, Note 1 — Liquidity and Financial Condition; Going Concern
[39] Item 1, Note 1 — Liquidity and Financial Condition; Going Concern
[40] Item 7, MD&A — CDM Acquisition
[41] Item 7, MD&A — CDM Acquisition
[42] Item 7, MD&A — Amended and Restated Credit Agreement
[43] Item 7, MD&A — Amended and Restated Credit Agreement
[44] Item 7, MD&A — Amended and Restated Credit Agreement
[45] Item 7, MD&A — North Run Securities Purchase Agreement
[46] Item 7, MD&A — North Run Securities Purchase Agreement
[47] Item 7, MD&A — Gain on Settlement of Contingent Consideration
[48] Item 7, MD&A — Gain on Settlement of Contingent Consideration
[49] Item 7, MD&A — Gain on Settlement of Contingent Consideration
[50] Item 7, MD&A — Gain on Settlement of Contingent Consideration
[51] Item 1, Note 1 — Liquidity and Financial Condition; Going Concern
[52] Item 1, Business
[53] Item 1, Business Strategy
[54] Item 1, Note 5 — Business Combinations
[55] Item 1, Business Strategy
[56] Item 7, MD&A — General and Administrative Expenses
[57] Item 1A, Risk Factors — We do not have sufficient capital to engage in material research and development, which may harm our long-term growth.
[58] Item 7, MD&A — Amended and Restated Credit Agreement
[59] Item 7, MD&A — Amended and Restated Credit Agreement
[60] Item 7, MD&A — Amended and Restated Credit Agreement
[61] Item 7, MD&A — North Run Securities Purchase Agreement
[62] Item 7, MD&A — Amended and Restated Credit Agreement
[63] Item 5, Dividend Policy
[64] Item 1A, Risk Factors — Our success and longevity depend on our ability to generate profits from future operations and obtain sufficient capital through financing transactions to satisfy our debt obligations and meet our other business obligations.
[65] Item 1A, Risk Factors — Our success and longevity depend on our ability to generate profits from future operations and obtain sufficient capital through financing transactions to satisfy our debt obligations and meet our other business obligations.
[66] Item 1A, Risk Factors — Our success and longevity depend on our ability to generate profits from future operations and obtain sufficient capital through financing transactions to satisfy our debt obligations and meet our other business obligations.
[67] Item 1A, Risk Factors — Our digital marketing business is evolving in a rapidly changing market, and we cannot ensure the long-term successful operation of our business or the execution of our business plan.
[68] Item 1A, Risk Factors — The variable sales cycle of some of our products make it difficult to predict operating results.
[69] Item 1A, Risk Factors — There has been, and we expect that there will continue to be, significant consolidation in our industry. Inability to either lead or remain active participants in that consolidation may have a severe adverse impact on our access to financing, customers, technology, and human resources.
[70] Item 1A, Risk Factors — We may not realize the growth opportunities that are anticipated from our acquisition of CDM.
[71] Item 1A, Risk Factors — We operate in an intensely competitive industry, and our competitors are developing products and solutions that incorporate AI and ML. We may not be as successful as our competitors in incorporating AI and ML into our products and solutions.
[72] Item 1A, Risk Factors — Our Canadian operations through CDM subject us to a complex and evolving framework of Canadian federal and provincial regulatory requirements, including data privacy, accessibility, French-language, and artificial intelligence laws, non-compliance with which could increase our costs, expose us to penalties, and adversely affect our business.
[73] Item 1A, Risk Factors — Fluctuations in the exchange rate between the U.S. dollar and the Canadian dollar could adversely affect our financial results.
[74] Item 1A, Risk Factors — Geopolitical conflicts, including the current conflicts involving Iran, Israel and the United States, as well as terrorism and other global security threats, could adversely affect our business, financial condition and results of operations.
[75] Item 1A, Risk Factors — High inflation and unfavorable economic conditions could negatively affect our business, financial condition and results of operations.
[76] Item 1A, Risk Factors — Changes in trade policy, tariff and import/export regulations may have a material adverse effect on our business, financial condition and results of operations.
[77] Item 1, Note 1 — Liquidity and Financial Condition; Going Concern
[78] Item 1, Note 1 — Liquidity and Financial Condition; Going Concern
[79] Item 1, Note 1 — Liquidity and Financial Condition; Going Concern
[80] Item 1A, Risk Factors — We do not have sufficient capital to engage in material research and development, which may harm our long-term growth.
[81] Item 1A, Risk Factors — Our continued growth and financial performance could be adversely affected by the loss of several key customers.
[82] Item 1A, Risk Factors — Our continued growth and financial performance could be adversely affected by the loss of several key customers.
[83] Item 1A, Risk Factors — Our continued growth and financial performance could be adversely affected by the loss of several key customers.
[84] Item 1A, Risk Factors — The CDM acquisition may fail to achieve beneficial synergies.
[85] Item 1A, Risk Factors — We are subject to cyber security risks and interruptions or failures in our information technology systems and those of third party partners with whom our applications are integrated, and will likely need to expend additional resources to enhance our protection from such risks. Notwithstanding our efforts, a cyber incident could occur and result in information theft, data corruption, operational disruption, and/or financial loss.
[86] Item 1A, Risk Factors — Our Canadian operations through CDM subject us to a complex and evolving framework of Canadian federal and provincial regulatory requirements, including data privacy, accessibility, French-language, and artificial intelligence laws, non-compliance with which could increase our costs, expose us to penalties, and adversely affect our business.
[87] Item 1A, Risk Factors — Fluctuations in the exchange rate between the U.S. dollar and the Canadian dollar could adversely affect our financial results.
[88] Item 1A, Risk Factors — Geopolitical conflicts, including the current conflicts involving Iran, Israel and the United States, as well as terrorism and other global security threats, could adversely affect our business, financial condition and results of operations.
[89] Item 1, Note 1 — Liquidity and Financial Condition; Going Concern

Analysis on 5/22/2026

Recent Material Events

2026-06-30Material Event

Creative Realities, Inc. entered into an underwriting agreement with Craig-Hallum Capital Group LLC on June 29, 2026, to conduct a public offering of 2,528,571 shares of common stock at $3.50 per share and 900,000 pre-funded warrants at $3.49 per warrant. The underwriter holds a 30-day option to purchase up to 428,614 additional shares. Expected net proceeds are approximately $10.9 million, potentially increasing to $12.3 million if the option is fully exercised. The company plans to use the funds to repay $1 million of its term loan facility and pay down obligations under its revolving loan facility to increase liquidity for acquisitions and general corporate purposes. Creative Realities, Inc. provides digital signage and technology solutions.

View filing ↗

2026-06-29Material Event

Creative Realities, Inc. announced a public underwritten offering of its common stock and pre-funded warrants on June 29, 2026. The company also provided preliminary financial estimates for the quarter ending June 30, 2026, expecting revenue between $21.0 million and $23.0 million and Adjusted EBITDA between $2.0 million and $2.2 million. Creative Realities, Inc. operates in the digital signage and media solutions industry.

View filing ↗