CSGシステムズIntlの四半期報告

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2025-07-01

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2025


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number 0-27512

CSG SYSTEMS INTERNATIONAL, INC.

(Exact name of registrant as specified in its charter)


Delaware	47-0783182
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

169 Inverness Dr W, Suite 300

Englewood, Colorado 80112

(Address of principal executive offices, including zip code)

(303) 200-2000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

     Title of each class

     Trading
Symbol(s)

     Name of each exchange on which registered

     Common Stock, Par Value $0.01 Per Share

     CSGS

     Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of August 5, 2025, the registrant had 28,768,398 shares of common stock outstanding.

CSG SYSTEMS INTERNATIONAL, INC.

FORM 10-Q for the Quarter Ended June 30, 2025

INDEX


		Page No.

Part I - FINANCIAL INFORMATION

Item 1.	Condensed Consolidated Balance Sheets as of June 30, 2025 and December 31, 2024 (Unaudited)	3

	Condensed Consolidated Statements of Income for the Quarters and Six Months Ended June 30, 2025 and 2024 (Unaudited)	4

	Condensed Consolidated Statements of Comprehensive Income for the Quarters and Six Months Ended June 30, 2025 and 2024 (Unaudited)	5

	Condensed Consolidated Statements of Stockholders’ Equity for the Quarters and Six Months Ended June 30, 2025 and 2024 (Unaudited)	6

	Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2025 and 2024 (Unaudited)	7

	Notes to Condensed Consolidated Financial Statements (Unaudited)	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	18

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	27

Item 4.	Controls and Procedures	28

Part II - OTHER INFORMATION

Item 1.	Legal Proceedings	29

Item 1A.	Risk Factors	29

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	29

Item 5.	Other Information	29

Item 6.	Exhibits	29

	Exhibit Index	30

	Signatures	31

Item 1. Financial Information

CSG SYSTEMS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS - UNAUDITED

(in thousands)


	June 30, 2025			December 31, 2024
ASSETS
Current assets:
Cash and cash equivalents	$	145,875		$	161,789
Settlement and merchant reserve assets		256,145			343,235
Trade accounts receivable:
Billed, net of allowance of $3,959 and $3,041		259,016			266,903
Unbilled		84,978			80,173
Income taxes receivable		10,897			2,600
Other current assets		47,183			46,182
Total current assets		804,094			900,882
Non-current assets:
Property and equipment, net of depreciation of $142,260 and $133,514		48,057			56,595
Operating lease right-of-use assets		16,557			24,166
Finance lease right-of-use assets		10,647			-
Software, net of amortization of $162,879 and $154,648		21,677			19,927
Goodwill		325,773			316,041
Acquired customer contracts, net of amortization of $143,546 and $133,279		34,071			39,377
Customer contract costs, net of amortization of $51,797 and $44,587		66,175			60,809
Deferred income taxes		77,019			73,295
Other assets		17,168			9,595
Total non-current assets		617,144			599,805
Total assets	$	1,421,238		$	1,500,687
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt	$	-		$	7,500
Operating lease liabilities		4,649			11,067
Customer deposits		35,210			41,448
Trade accounts payable		40,279			36,370
Accrued employee compensation		60,952			67,944
Settlement and merchant reserve liabilities		253,085			341,924
Deferred revenue		62,251			54,424
Income taxes payable		211			7,802
Other current liabilities		59,325			46,730
Total current liabilities		515,962			615,209
Non-current liabilities:
Long-term debt, net of unamortized discounts of $12,233 and $12,128		537,767			530,997
Operating lease liabilities		22,524			25,020
Deferred revenue		26,198			26,469
Income taxes payable		2,903			2,732
Deferred income taxes		69			94
Other non-current liabilities		25,094			17,597
Total non-current liabilities		614,555			602,909
Total liabilities		1,130,517			1,218,118
Stockholders' equity:
Preferred stock, par value $.01 per share; 10,000 shares authorized; zero shares issued and outstanding		-			-
Common stock, par value $.01 per share; 100,000 shares authorized; 28,877 and 28,854 shares outstanding		722			718
Additional paid-in capital		522,824			518,215
Treasury stock, at cost; 42,011 and 41,583 shares		(1,220,897	)		(1,194,224	)
Accumulated other comprehensive income (loss):
Cumulative foreign currency translation adjustments		(41,892	)		(62,290	)
Accumulated earnings		1,029,964			1,020,150
Total stockholders' equity		290,721			282,569
Total liabilities and stockholders' equity	$	1,421,238		$	1,500,687

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

CSG SYSTEMS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED

(in thousands, except per share amounts)


	Quarter Ended						Six Months Ended
	June 30, 2025			June 30, 2024			June 30, 2025			June 30, 2024
Revenue	$	297,128		$	290,318		$	596,581		$	585,453

Cost of revenue (exclusive of depreciation, shown separately below)		150,140			152,892			304,638			310,779
Other operating expenses:
Research and development		40,417			38,411			81,319			74,506
Selling, general and administrative		67,541			61,159			129,830			122,881
Depreciation		4,585			5,337			9,598			10,973
Restructuring and reorganization charges		4,588			7,099			11,956			9,097
Total operating expenses		267,271			264,898			537,341			528,236
Operating income		29,857			25,420			59,240			57,217
Other income (expense):
Interest expense		(7,399	)		(7,698	)		(14,597	)		(15,204	)
Interest income		1,070			2,103			2,982			4,719
Loss on debt extinguishment		-			-			(453	)		-
Other, net		(3,598	)		174			(5,751	)		732
Total other		(9,927	)		(5,421	)		(17,819	)		(9,753	)
Income before income taxes		19,930			19,999			41,421			47,464
Income tax provision		(7,663	)		(6,170	)		(13,024	)		(14,168	)
Net income	$	12,267		$	13,829		$	28,397		$	33,296

Weighted-average shares outstanding:
Basic		27,843			28,546			27,829			28,531
Diluted		28,132			28,600			28,199			28,698

Earnings per common share:
Basic	$	0.44		$	0.48		$	1.02		$	1.17
Diluted		0.44			0.48			1.01			1.16

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

CSG SYSTEMS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - UNAUDITED

(in thousands)


	Quarter Ended					Six Months Ended
	June 30, 2025		June 30, 2024			June 30, 2025		June 30, 2024
Net income	$	12,267	$	13,829		$	28,397	$	33,296
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments		13,575		(241	)		20,398		(5,216	)
Other comprehensive income (loss), net of tax		13,575		(241	)		20,398		(5,216	)
Total comprehensive income, net of tax	$	25,842	$	13,588		$	48,795	$	28,080

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

CSG SYSTEMS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY - UNAUDITED

(in thousands)


	Shares of Common Stock Outstanding			Common Stock			Additional Paid-in Capital			Treasury Stock			Accumulated Other Comprehensive Income (Loss)			Accumulated Earnings			Total Stockholders' Equity
For the Six Months Ended June 30, 2025:
BALANCE, January 1, 2025		28,854		$	718		$	518,215		$	(1,194,224	)	$	(62,290	)	$	1,020,150		$	282,569
Comprehensive income:
Net income		-			-			-			-			-			16,130
Foreign currency translation adjustments		-			-			-			-			6,823			-
Total comprehensive income																				22,953
Repurchase of common stock		(358	)		(2	)		(12,807	)		(9,427	)		-			-			(22,236	)
Issuance of common stock pursuant to employee stock purchase plan		15			-			769			-			-			-			769
Issuance of restricted common stock pursuant to stock-based compensation plans		608			6			(6	)		-			-			-			-
Cancellation of restricted common stock issued pursuant to stock-based compensation plans		(15	)		-			-			-			-			-			-
Stock-based compensation expense		-			-			8,404			-			-			-			8,404
Dividends		-			-			-			-			-			(9,364	)		(9,364	)
BALANCE, March 31, 2025		29,104			722			514,575			(1,203,651	)		(55,467	)		1,026,916			283,095
Comprehensive income:
Net income		-			-			-			-			-			12,267
Foreign currency translation adjustments		-			-			-			-			13,575			-
Total comprehensive income																				25,842
Repurchase of common stock		(289	)		-			(976	)		(17,246	)		-			-			(18,222	)
Issuance of common stock pursuant to employee stock purchase plan		12			-			676			-			-			-			676
Issuance of restricted common stock pursuant to stock-based compensation plans		69			-			-			-			-			-			-
Cancellation of restricted common stock issued pursuant to stock-based compensation plans		(19	)		-			-			-			-			-			-
Stock-based compensation expense		-			-			8,549			-			-			-			8,549
Dividends		-			-			-			-			-			(9,219	)		(9,219	)
BALANCE, June 30, 2025		28,877		$	722		$	522,824		$	(1,220,897	)	$	(41,892	)	$	1,029,964		$	290,721


	Shares of Common Stock Outstanding			Common Stock			Additional Paid-in Capital			Treasury Stock			Accumulated Other Comprehensive Income (Loss)			Accumulated Earnings			Total Stockholders' Equity
For the Six Months Ended June 30, 2024:
BALANCE, January 1, 2024		29,541		$	713		$	490,947		$	(1,136,055	)	$	(50,413	)	$	968,134		$	273,326
Comprehensive income:
Net income		-			-			-			-			-			19,467
Foreign currency translation adjustments		-			-			-			-			(4,975	)		-
Total comprehensive income																				14,492
Repurchase of common stock		(344	)		(2	)		(8,538	)		(9,683	)		-			-			(18,223	)
Issuance of common stock pursuant to employee stock purchase plan		20			-			866			-			-			-			866
Issuance of restricted common stock pursuant to stock-based compensation plans		573			6			(6	)		-			-			-			-
Cancellation of restricted common stock issued pursuant to stock-based compensation plans		(11	)		-			-			-			-			-			-
Stock-based compensation expense		-			-			7,736			-			-			-			7,736
Dividends		-			-			-			-			-			(8,857	)		(8,857	)
BALANCE, March 31, 2024		29,779			717			491,005			(1,145,738	)		(55,388	)		978,744			269,340
Comprehensive income:
Net income		-			-			-			-			-			13,829
Foreign currency translation adjustments		-			-			-			-			(241	)		-
Total comprehensive income																				13,588
Repurchase of common stock		(228	)		-			(397	)		(9,804	)		-			-			(10,201	)
Issuance of common stock pursuant to employee stock purchase plan		20			-			752			-			-			-			752
Issuance of restricted common stock pursuant to stock-based compensation plans		90			1			(1	)		-			-			-			-
Cancellation of restricted common stock issued pursuant to stock-based compensation plans		(70	)		(1	)		1			-			-			-			-
Stock-based compensation expense		-			-			8,635			-			-			-			8,635
Dividends		-			-			-			-			-			(8,785	)		(8,785	)
BALANCE, June 30, 2024		29,591		$	717		$	499,995		$	(1,155,542	)	$	(55,629	)	$	983,788		$	273,329

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

CSG SYSTEMS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED

(in thousands)


	Six Months Ended
	June 30, 2025			June 30, 2024
Cash flows from operating activities:
Net income	$	28,397		$	33,296
Adjustments to reconcile net income to net cash provided by operating activities-
Depreciation		9,956			11,409
Amortization		25,383			24,147
Loss on debt extinguishment		453			-
(Gain) loss on unrealized foreign currency transactions, net		889			(254	)
Deferred income taxes		(2,413	)		2,311
Stock-based compensation		16,953			16,371
Changes in operating assets and liabilities, net of acquired amounts:
Trade accounts receivable, net		1,147			892
Other current and non-current assets and liabilities		(11,489	)		(11,154	)
Income taxes payable/receivable		(15,704	)		(11,937	)
Trade accounts payable and accrued liabilities		(9,191	)		(52,596	)
Deferred revenue		4,414			1,269
Net cash provided by operating activities		48,795			13,754

Cash flows from investing activities:
Purchases of software, property, and equipment		(7,152	)		(9,073	)
Receipts from sale of software, property, and equipment		152			-
Business combinations, net of cash and settlement assets acquired of zero and $46,432		-			17,293
Net cash provided by (used in) investing activities		(7,000	)		8,220

Cash flows from financing activities:
Proceeds from issuance of common stock		1,445			1,618
Payments of cash dividends		(18,506	)		(18,088	)
Repurchases of common stock		(40,545	)		(27,943	)
Deferred acquisition payments		(314	)		(488	)
Proceeds from long-term debt		150,625			15,000
Payments on long-term debt		(151,250	)		(18,750	)
Payments of debt financing costs		(2,258	)		-
Payments on financing obligations		(1,277	)		(469	)
Payments on finance lease obligations		(882	)		-
Settlement and merchant reserve activity		(89,149	)		(88,703	)
Net cash used in financing activities		(152,111	)		(137,823	)
Effect of exchange rate fluctuations on cash, cash equivalents, and restricted cash		7,375			(2,438	)

Net decrease in cash, cash equivalents, and restricted cash		(102,941	)		(118,287	)

Cash, cash equivalents, and restricted cash, beginning of period		506,763			463,876
Cash, cash equivalents, and restricted cash, end of period	$	403,822		$	345,589

Supplemental disclosures of cash flow information:
Cash paid during the period for-
Interest	$	12,632		$	13,566
Income taxes		31,213			23,822

Non-cash investing and financing activities-
Software, property, and equipment included in current and non-current liabilities		11,803			9,017

Reconciliation of cash, cash equivalents, and restricted cash:
Cash and cash equivalents	$	145,875		$	110,435
Settlement and merchant reserve assets		256,145			232,054
Restricted cash included in current and non-current assets		1,802			3,100
Total cash, cash equivalents, and restricted cash	$	403,822		$	345,589

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

CSG SYSTEMS INTERNATIONAL, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1. GENERAL

CSG Systems International, Inc. (the "Company", "CSG", or forms of the pronoun "we") have prepared the accompanying unaudited condensed consolidated financial statements as of June 30, 2025 and December 31, 2024, and for the quarters and six months ended June 30, 2025 and 2024, in accordance with accounting principles generally accepted in the United States of America (“U.S.”) (“GAAP”) for interim financial information, and pursuant to the instructions to Form 10-Q and the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of our management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation of our financial position and operating results have been included. The unaudited Condensed Consolidated Financial Statements (the “Financial Statements”) should be read in conjunction with the Consolidated Financial Statements and notes thereto, together with Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”), contained in our Annual Report on Form 10-K for the year ended December 31, 2024 (our “2024 10-K”), filed with the SEC. The results of operations for the quarter and six months ended June 30, 2025 are not necessarily indicative of the expected results for the entire year ending December 31, 2025.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates in Preparation of Financial Statements. The preparation of our Financial Statements requires management to make estimates and assumptions that may affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of our Financial Statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates.

Revenue. As of June 30, 2025, our aggregate amount of the transaction price allocated to the remaining performance obligations was approximately $1.7 billion, which is made up of fixed fee consideration and guaranteed minimums expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied). We expect to recognize approximately 70% of this amount by the end of 2027, with the remaining amount recognized by the end of 2036. We have excluded from this amount variable consideration expected to be recognized in the future related to performance obligations that are unsatisfied. The majority of our future revenue is related to our SaaS and related solutions customer contracts that include variable consideration dependent upon a series of monthly volumes and/or daily usage of services and have contractual terms ending from 2025 through 2036. Our customer contracts may include guaranteed minimums and fixed monthly or annual fees.

The nature, amount, timing, and uncertainty of our revenue and how revenue and cash flows are affected by economic factors is most appropriately depicted by revenue type, geographic region, and customer vertical.

Revenue by type for the quarters and six months ended June 30, 2025 and 2024 was as follows (in thousands):


	Quarter Ended				Six Months Ended
	June 30, 2025		June 30, 2024		June 30, 2025		June 30, 2024
SaaS and related solutions	$	269,548	$	262,658	$	539,488	$	524,353
Software and services		16,290		14,681		34,913		37,075
Maintenance		11,290		12,979		22,180		24,025
Total revenue	$	297,128	$	290,318	$	596,581	$	585,453

We use the location of the customer as the basis of attributing revenue to geographic regions. Revenue by geographic region for the quarters and six months ended June 30, 2025 and 2024, as a percentage of our total revenue, was as follows:


	Quarter Ended						Six Months Ended
	June 30, 2025			June 30, 2024			June 30, 2025			June 30, 2024
Americas (principally the U.S.)		85	%		89	%		86	%		87	%
Europe, Middle East, and Africa (principally Europe)		11	%		6	%		10	%		8	%
Asia Pacific		4	%		5	%		4	%		5	%
Total revenue		100	%		100	%		100	%		100	%

We generate our revenue primarily from the global communications markets; however, we serve an expanding group of customers in other markets including retail, financial services, healthcare, insurance, and government entities. Revenue by customer vertical for the quarters and six months ended June 30, 2025 and 2024, as a percentage of our total revenue, was as follows:


	Quarter Ended						Six Months Ended
	June 30, 2025			June 30, 2024			June 30, 2025			June 30, 2024
Broadband/Cable/Satellite		51	%		53	%		50	%		52	%
Telecommunications		18	%		16	%		18	%		17	%
Other		31	%		31	%		32	%		31	%
Total revenue		100	%		100	%		100	%		100	%

Deferred revenue recognized during the quarters ended June 30, 2025 and 2024 was $13.3 million and $10.7 million, respectively. Deferred revenue recognized during the six months ended June 30, 2025 and 2024 was $33.0 million and $29.8 million, respectively.

Cash and Cash Equivalents. We consider all highly liquid investments with original maturities of three months or less as of the date of purchase to be cash equivalents. As of June 30, 2025 and December 31, 2024, our cash equivalents consist primarily of time deposits held at major banks. For the cash and cash equivalents denominated in foreign currencies and/or located outside the U.S., we do not anticipate any material amounts being unavailable for use in running our business, but may face limitations on moving cash out of certain foreign jurisdictions due to currency controls and potential negative economic consequences.

Restricted Cash. Restricted cash includes cash that is legally or contractually restricted, as well as our settlement and merchant reserve assets (discussed below). The nature of the restrictions on our settlement and merchant reserve assets consists of contractual restrictions with the merchants and restrictions arising from our policy and intention. It has historically been our policy to segregate settlement and merchant reserve assets from our operating cash balances, and our intention is to continue to do so. As of June 30, 2025 and December 31, 2024, we had $1.8 million and $1.7 million, respectively, of restricted cash that mainly serves to collateralize bank and performance guarantees included in other non-current assets on our unaudited Condensed Consolidated Balance Sheets (“Balance Sheets” or “Balance Sheet”).

Settlement and Merchant Reserve Assets and Liabilities. Settlement assets and settlement liabilities represent cash collected on behalf of merchants via payments processing services which is held for an established holding period until settlement with the customer. The holding period is generally one to four business days depending on the payment model and contractual terms with the customer. During the holding period, cash is subject to restriction and segregation based on the nature of our custodial relationship with the merchants. Should we fail to remit these funds to our merchants, the merchant's sole recourse for payment would be against us. These rights and obligations are set forth in the contracts between us and the merchants. Settlement assets are held with various major financial institutions, and a corresponding liability is recorded for the amounts owed to the customer. At any given time, there may be differences between the cash held and the corresponding liability due to the timing of operating-related cash transfers.

Merchant reserve assets/liabilities represent deposits collected from merchants to mitigate our risk of loss due to nonperformance of settlement obligations initiated by those merchants using our payments processing services, or non-payment by customers for services rendered by us. We perform a credit risk evaluation on each customer based on multiple criteria, which provides the basis for the deposit amount required for each merchant. For the duration of our relationship with each merchant, we hold their reserve deposits with major financial institutions. We hold these funds in separate accounts, which are offset by corresponding liabilities.

The following table summarizes our settlement and merchant reserve assets and liabilities as of the indicated periods (in thousands):


	June 30, 2025				December 31, 2024
	Assets		Liabilities		Assets		Liabilities
Settlement assets/liabilities	$	244,895	$	241,837	$	330,769	$	329,458
Merchant reserve assets/liabilities		11,250		11,248		12,466		12,466
Total	$	256,145	$	253,085	$	343,235	$	341,924

Financial Instruments. Our financial instruments as of June 30, 2025 and December 31, 2024 include cash and cash equivalents, settlement and merchant reserve assets and liabilities, accounts receivable, accounts payable, and debt. Due to their short maturities, the carrying amounts of cash equivalents, settlement and merchant reserve assets and liabilities, accounts receivable, and accounts payable approximate their fair value. Realized and unrealized gains and losses were not material in any period presented.

We have chosen not to record our debt at fair value, with changes recognized in earnings each reporting period. The following table indicates the carrying value and estimated fair value of our debt as of the indicated periods (in thousands):


	June 30, 2025				December 31, 2024
	Carrying Value		Fair Value		Carrying Value		Fair Value
2025 Credit Agreement (carrying value)	$	125,000	$	125,000	$	-	$	-
2023 Convertible Notes (par value)		425,000		481,313		425,000		429,144
2021 Credit Agreement (carrying value including current maturities)		-		-		125,625		125,625

The fair value of our convertible notes was estimated based upon quoted market prices or recent sales activity, while the fair values of our credit agreements were estimated using a discounted cash flow methodology, both of which are considered Level 2 inputs. See Note 5 for a discussion regarding our debt.

New Tax Legislation. The One Big Beautiful Bill Act (“OBBBA”) was enacted on July 4, 2025 and we are assessing the impact of this new legislation. The effect of changes in tax laws, including retroactive changes, are recognized in the financial statement in the period that the changes are enacted. The OBBBA is not currently expected to materially impact our effective tax rate, but we are still assessing the potential impact to our deferred tax balances and cash flows which will be reflected in our financial statements beginning in the third quarter of 2025.

Accounting Pronouncements Issued but Not Yet Effective. In December 2023, the Financial Accounting Standards Board ("FASB") issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”), which requires entities to disclose more detailed information about their effective tax rate reconciliation as well as information on income taxes paid. ASU 2023-09 is effective for annual periods beginning after December 15, 2024. The adoption of this standard only impacts disclosures and is not expected to have a material impact on our Financial Statements.

In November 2024, the FASB issued ASU No. 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40) (“ASU 2024-03”), which requires entities to disclose disaggregated information about certain income statement expense line items in the notes to their financial statements on an annual and interim basis. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027, with early adoption permitted. We are currently in the process of evaluating the impact of this ASU on our Financial Statements and related disclosures.

3. SEGMENT REPORTING AND CUSTOMER CONCENTRATION

Segment Information. Our Chief Operating Decision Maker ("CODM") is our President and Chief Executive Officer. We have evaluated how our CODM has organized the Company for purposes of making operating decisions, preparing budgets and forecasts, setting targets, allocating resources, and assessing performance. Our CODM manages all business activities on a consolidated basis, and as a result, we have concluded that as of June 30, 2025, there is one reportable segment.

As our one segment is managed on a consolidated basis, our measure of segment profit or loss is consolidated net income. Our CODM uses consolidated net income to assess the performance of our one segment and decide how and where to allocate resources and reinvest profits into the business in areas such as research and development (“R&D”), business and/or asset acquisitions, investments in market share expansion with our existing and potential new customers, talent, technology, the repurchase of our common stock, and/or the payment of dividends. Net income, and components of net income, are used to monitor actual performance and are compared to budgeted and forecasted results to assess the performance of our one segment, set targets, and establish management’s incentive compensation. The measure of consolidated segment assets is reported on our Balance Sheets as total assets. We do not have intra-entity sales or transfers.

We regularly provide our CODM a reporting package that shows our results by functional expense, similar to our Income Statements. However, for purposes of this reporting package, depreciation is included in these functional expense categories, rather than broken out separately. Additionally, certain expenses such as restructuring and reorganization charges, executive transition costs, and acquisition-related charges, along with non-cash charges such as stock-based compensation and amortization of acquired intangibles, are excluded. The following table provides the significant expenses that are regularly provided to our CODM for our one segment, the required disclosable amounts that are included in consolidated net income, and a reconciliation to consolidated net income for the quarters and six months ended June 30, 2025 and 2024:


	Quarter Ended				Six Months Ended
	June 30, 2025		June 30, 2024		June 30, 2025		June 30, 2024
Revenue	$	297,128	$	290,318	$	596,581	$	585,453
Less:
Cost of revenue:
Transaction fees		25,866		24,207		53,767		49,269
All other (1)		122,626		127,922		247,859		261,245
Total cost of revenue		148,492		152,129		301,626		310,514
Research and development (1)		39,622		37,853		79,438		73,923
Selling and marketing (1)		27,202		28,390		53,875		57,589
General and administrative (1)		27,340		25,804		55,695		52,418
Restructuring and reorganization charges (1)		4,588		7,099		11,956		9,097
Stock-based compensation		8,762		9,193		17,474		17,062
Other segment items (2)		13,793		2,153		20,499		2,182
Interest expense		7,399		7,698		14,597		15,204
Income tax provision		7,663		6,170		13,024		14,168
Segment net income		12,267		13,829		28,397		33,296
Reconciliation of profit or loss:
Adjustments and reconciling items		-		-		-		-
Consolidated net income	$	12,267	$	13,829	$	28,397	$	33,296

(1)

These functional expense lines include depreciation expense, which is presented separately on our Income Statements.

(2)

Other segment items include acquisition-related costs (transaction-related costs, earn-out compensation, and amortization of acquired intangible assets), executive transition costs, interest income, loss on extinguishment of debt, and foreign currency gains/losses.

Depreciation expense and interest income are separately disclosed on our Income Statements. Amortization expense is separately disclosed on our Statements of Cash Flows and is discussed in Note 4.

4. GOODWILL AND INTANGIBLE ASSETS

Goodwill. The changes in the carrying amount of goodwill for the six months ended June 30, 2025 were as follows (in thousands):


January 1, 2025, balance	$	316,041
Effects of changes in foreign currency exchange rates		9,732
June 30, 2025, balance	$	325,773

Other Intangible Assets. Our other intangible assets subject to ongoing amortization consist of acquired customer contracts and software. As of June 30, 2025 and December 31, 2024, the carrying values of these assets were as follows (in thousands):


	June 30, 2025							December 31, 2024
	Gross Carrying Amount		Accumulated Amortization			Net Amount		Gross Carrying Amount		Accumulated Amortization			Net Amount
Acquired customer contracts	$	177,617	$	(143,546	)	$	34,071	$	172,656	$	(133,279	)	$	39,377
Software		184,556		(162,879	)		21,677		174,575		(154,648	)		19,927
Total other intangible assets	$	362,173	$	(306,425	)	$	55,748	$	347,231	$	(287,927	)	$	59,304

The total amortization expense related to other intangible assets for the second quarters of 2025 and 2024 was $6.6 million and $6.3 million, respectively, and for the six months ended June 30, 2025 and 2024 were $13.3 million and $11.7 million, respectively. Based on the June 30, 2025 net carrying value of our intangible assets, the estimated total amortization expense for each of the five succeeding fiscal years ending December 31 will be: 2025 - $26.0 million; 2026 - $18.1 million; 2027 - $9.1 million; 2028 - $4.9 million; and 2029 - $3.6 million.

Customer Contract Costs. As of June 30, 2025 and December 31, 2024, the carrying values of our customer contract cost assets, related to those contracts with a contractual term greater than one year, were as follows (in thousands):


	June 30, 2025							December 31, 2024
	Gross Carrying Amount		Accumulated Amortization			Net Amount		Gross Carrying Amount		Accumulated Amortization			Net Amount
Customer contract costs	$	117,972	$	(51,797	)	$	66,175	$	105,396	$	(44,587	)	$	60,809

The total amortization expense related to customer contract costs for the second quarters of 2025 and 2024 was $4.8 million and $5.7 million, respectively, and for the six months ended June 30, 2025 and 2024 was $9.4 million and $10.7 million, respectively.

5. DEBT

As of June 30, 2025 and December 31, 2024, our long-term debt was as follows (in thousands):


	June 30, 2025			December 31, 2024
2025 Credit Agreement:
$600 million revolving loan facility, due March 2030, interest at adjusted SOFR plus applicable margin (combined rate of 5.793% at June 30, 2025)	$	125,000		$	-
Less – deferred financing costs		(2,959	)		-
2025 Term Loan, net of unamortized discounts		122,041			-
2023 Convertible Notes:
2023 Convertible Notes – senior unsecured convertible notes, due September 2028, cash interest at 3.875%		425,000			425,000
Less – deferred financing costs		(9,274	)		(10,618	)
2023 Convertible Notes, net of unamortized discounts		415,726			414,382
2021 Credit Agreement:
2021 Term Loan, due September 2026, interest at adjusted SOFR plus applicable margin (combined rate of 5.804% at December 31, 2024)		-			125,625
Less – deferred financing costs		-			(1,510	)
2021 Term Loan, net of unamortized discounts		-			124,115
$450 million revolving loan facility, due September 2026, interest at adjusted SOFR plus applicable margin		-			-
Total debt, net of unamortized discounts		537,767			538,497
Current portion of long-term debt		-			(7,500	)
Long-term debt, net of unamortized discounts	$	537,767		$	530,997

2025 Credit Agreement. In March 2025, we entered into a $600.0 million five-year debt arrangement (the "2025 Credit Agreement") with a consortium of banks. The 2025 Credit Agreement consists of a $600.0 million aggregate principal five-year revolving loan facility (the "2025 Revolver") due March 2030 (subject to a springing maturity of 91 days prior to the maturity date of certain of our long-term indebtedness if, on such date, the aggregate principal amount of such indebtedness equals or exceeds $127.0 million and 50% of consolidated EBITDA (subject to certain exceptions as defined in the 2025 Credit Agreement)). The 2025 Credit Agreement replaced our $600.0 million five-year credit agreement entered into in September 2021 (the “2021 Credit Agreement”), which consisted of: (i) $150.0 million aggregate principal five-year term loan (the "2021 Term Loan"); and (ii) $450.0 million revolving loan facility (the "2021 Revolver").

Upon execution of the 2025 Credit Agreement, we withdrew $140.6 million from the 2025 Revolver. These funds were used to repay: (i) the outstanding $125.6 million balance of 2021 Term Loan; (ii) the outstanding $10.0 million balance of 2021 Revolver that we withdrew during the first quarter of 2025; and (iii) certain fees and expenses in connection with the new debt arrangement, with the remainder to be used for general corporate purposes.

The interest rates under the 2025 Credit Agreement are based upon our choice of an adjusted Secured Overnight Financing Rate ("SOFR") plus an applicable margin of 1.375% - 2.125%, or an alternate base rate ("ABR") plus an applicable margin of 0.375% - 1.125%, with the applicable margin dependent upon our then-net secured total leverage ratio. We pay a commitment fee of 0.150% - 0.325% of the average daily unused amount of the 2025 Revolver, with the commitment fee rate also dependent upon our then-net secured total leverage ratio.

The 2025 Credit Agreement requires quarterly commitment fee payments and interest payments based on the interest election period. The 2025 Credit Agreement contains certain customary prepayment or repayment provisions. As specified in the 2025 Credit Agreement, if certain customary events were to occur, we may be required to pay all amounts outstanding under the 2025 Credit Agreement, together with interest payable thereon.

The 2025 Credit Agreement contains customary affirmative covenants. In addition, the 2025 Credit Agreement has customary negative covenants that places limits on our ability to: (i) incur additional indebtedness; (ii) create liens on its property; (iii) make investments; (iv) enter into mergers and consolidations; (v) sell assets; (vi) declare dividends or repurchase shares; (vii) engage in certain transactions with affiliates; (viii) prepay certain indebtedness; and (ix) issue capital stock of subsidiaries. We must also meet a total net leverage ratio financial covenant.

During the second quarter of 2025, we repaid $0.6 million. As of June 30, 2025, we had $125.0 million outstanding on our 2025 Revolver, leaving $475.0 million available to us.

In conjunction with the closing of the 2025 Credit Agreement, we incurred total debt financing costs of $2.3 million. As certain lenders from the 2021 Credit Agreement chose not to participate in the 2025 Credit Agreement we recognized a loss on extinguishment of $0.5 million, which related to the write-off of unamortized debt issuance costs. The remaining $0.9 million of unamortized debt issuance costs related to the 2021 Credit Agreement, when combined with the $2.3 million of debt financing costs related to 2025 Credit Agreement, totaled $3.2 million and are being amortized to interest expense over the term of the 2025 Credit Agreement.

2023 Convertible Notes. The 2023 Convertible Notes will be convertible at the option of the noteholders before June 15, 2028, upon the occurrence of certain events. On or after June 15, 2028, and until the close of business on the second scheduled trading day immediately preceding September 15, 2028, the maturity date, noteholders may convert all or any portion of their notes at any time regardless of these conditions.

The 2023 Convertible Notes will be convertible at an initial conversion rate of 14.0753 shares of our common stock per $1,000 principal amount of the 2023 Convertible Notes, which is equivalent to an initial conversion price of $71.05 per share of our common stock, plus carryforward adjustments not yet effected pursuant to the terms of the indenture governing the 2023 Convertible Notes. Under the terms of the 2023 Convertible Notes, we will adjust the conversion rate for any quarterly dividends exceeding $0.28 per share.

We are required to satisfy our conversion obligation as follows: (i) paying cash up to the aggregate principal amount of notes to be converted; and (ii) to the extent the value of our conversion obligation exceeds the par value, we will satisfy the remaining conversion obligation in our common stock, cash, or a combination thereof, at our election. As of June 30, 2025, none of the conditions to early convert have been met.

We may not redeem the 2023 Convertible Notes prior to September 21, 2026. On or after September 21, 2026, we may redeem for cash all or part of the 2023 Convertible Notes, subject to a partial redemption limitation that requires at least $100.0 million of the principal amount of the 2023 Convertible Notes to remain outstanding if the last reported sales price of our common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which we provide notice of redemption. The redemption price will equal the principal amount of the 2023 Convertible Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. No sinking fund has been established for the 2023 Convertible Notes.

In connection with the pricing of the 2023 Convertible Notes, we entered into privately negotiated capped call transactions (the “Capped Call Transactions”) with certain of the initial purchasers of the 2023 Convertible Notes and other financial institutions (collectively, the “Option Counterparties”). As of June 30, 2025, all the Capped Call Transactions were outstanding and cover, subject to anti-dilution adjustments substantially similar to those applicable to the 2023 Convertible Notes, 5.98 million shares of our common stock, the same number of shares of common stock underlying the 2023 Convertible Notes. The Capped Call Transactions will expire upon the maturity of the 2023 Convertible Notes.

Other. We finance certain of our internal use software. During the second quarter of 2025, we entered into financing agreements at a total cost of $1.8 million with payments through 2028. As of June 30, 2025 and December 31, 2024, we had $11.8 million and $8.5 million, respectively, outstanding under these agreements, of which $6.7 million and $4.2 million, respectively, were included in current liabilities and $5.1 million and $4.3 million, respectively, were included in non-current liabilities on our Balance Sheets. These arrangements are treated as non-cash investing and financing activities for purposes of our Condensed Consolidated Statements of Cash Flows ("Statements of Cash Flows").

Additionally, during the first quarter of 2025, we extended our agreement with our outsourced computing services provider (see Note 8) and elected to extend our current data center environment through 2028, which required us to reassess the lease classification. As a result, as of June 30, 2025, we have a finance lease right-of-use asset of $10.6 million. During the six months ended June 30, 2025, we have made finance lease payments of $0.9 million.

6. ACQUISITIONS

iCheckGateway.com, LLC. On June 3, 2024, we acquired 100% of the equity of iCheckGateway.com, LLC (“iCG”), an ACH and credit card payment processing company. We acquired iCG to further expand the industry verticals we serve and to provide opportunities for the continued growth of our business. The acquisition date fair value of the consideration transferred was $17.6 million in cash paid upon close.

The iCG acquisition includes provisions for up to $15.0 million of potential future earn-out payments. The earn-out payments are tied to performance-based goals and a defined service period and are accounted for as post-acquisition compensation, as applicable. The earn-out period is through June 3, 2027. During the second quarter of 2025, we made earn-out payments of $5.0 million. As of June 30, 2025, we have accrued $3.5 million related to the potential earn-out payments.

DGIT Systems Pty Ltd. On October 4, 2021, we acquired DGIT Systems Pty Ltd (“DGIT”), a provider of configure, price and quote (CPQ), and order management solutions for the telecommunications industry. We acquired 100% of the equity of DGIT for a purchase price of approximately $16 million, approximately $14 million paid upon close and the remaining consideration of approximately $2 million to be paid through 2025, subject to certain reductions, as applicable. During the first quarter of 2025, we made the final deferred purchase price payment of $0.3 million.

The DGIT acquisition includes provisions for up to approximately $12 million of potential future earn-out payments. The earn-out payments are tied to performance-based goals and a defined service period and are accounted for as post-acquisition compensation, as applicable. The earn-out period is through December 31, 2026. Through June 30, 2025, $0.4 million of the earn-out had been achieved and was paid, including $0.1 million paid in the first quarter of 2025. As of June 30, 2025, we have accrued $8.0 million related to potential earn-out payments.

7. RESTRUCTURING AND REORGANIZATION CHARGES

During the second quarters of 2025 and 2024, we recorded restructuring and reorganization charges of $4.6 million and $7.1 million, respectively, and for the six months ended June 30, 2025 and 2024, we recorded restructuring and reorganization charges of $12.0 million and $9.1 million, respectively.

During the six months ended June 30, 2025, we implemented the following restructuring and reorganizational activities:

•

We reduced our global workforce by approximately 150 employees, as part of cost efficiency actions to optimize our capacity and better align our resources. As a result, we incurred restructuring charges related to involuntary terminations of $7.7 million.

•

At the end of March 2025, we announced our plans to close our design and delivery center in Crawfordville, Florida in August 2025. All processing volumes done at this location are currently being transitioned to our two other design and delivery facilities. The closing of this facility will result in the elimination of approximately 100 employees in Florida, which is occurring in phases beginning in June 2025. Additional hires will be made at the other locations to absorb the additional volumes. As of June 30, 2025, all impacted employees have been notified and the related severance costs are being accrued over each employee's respective service period, which resulted in $2.0 million of expense during the second quarter of 2025. The total estimated cost of this facility closure, to include involuntary termination benefits, relocation costs, accelerated depreciation, and decommissioning work is expected to be approximately $5 million. As of June 30, 2025 we have incurred total expenses of $3.2 million, with the majority of the remaining costs expected to be incurred during the remainder of 2025.

The activity in the restructuring and reorganization reserves during the six months ended June 30, 2025 was as follows (in thousands):


	Termination Benefits			Other			Total
January 1, 2025, balance	$	1,202		$	2,520		$	3,722
Charged to expense during period		9,727			2,229			11,956
Cash payments		(7,891	)		(3,131	)		(11,022	)
Adjustment for accelerated depreciation		-			(358	)		(358	)
Other		(517	)		-			(517	)
June 30, 2025, balance	$	2,521		$	1,260		$	3,781

During the first quarter of 2025, we paid $1.3 million related to the exit of a reseller agreement that was acquired with the acquisition of Forte Payment Systems, Inc. in 2018.

As of June 30, 2025, all restructuring and reorganization reserves were included in current liabilities.

8. COMMITMENTS, GUARANTEES AND CONTINGENCIES

Service Agreements. In March 2025, we extended our agreement with Ensono, Inc. to provide us with outsourced computing services through December 31, 2032. As part of this extension, we elected to extend our current data center environment through 2028, which resulted in the lease classification of the data center environment being reassessed. The data center environment is now being accounted for as a finance lease right-of-use asset on our Balance Sheet with the corresponding liability in other current and non-current liabilities.

Guarantees. In the ordinary course of business, we may provide guarantees in the form of bid bonds or performance bonds. As of June 30, 2025, we had $1.8 million of restricted assets used to collateralize these guarantees, which are included in other non-current assets on our Balance Sheet.

We have performance guarantees in the form of surety bonds and standby letters of credit, along with money transmitter bonds, issued through third-parties that are not required to be reflected on our Balance Sheets. As of June 30, 2025, we had performance guarantees of $3.8 million. We are ultimately liable for claims that may occur against these guarantees. We have no history of material claims or are aware of circumstances that would require us to pay under any of these arrangements. We also believe that the resolution of any claim that may arise in the future, either individually or in the aggregate, would not be material to our Financial Statements. As of June 30, 2025, we had total aggregate money transmitter bonds of $23.7 million outstanding. These money transmitter bonds are for the benefit of various states to comply with the states’ financial requirements and industry regulations for money transmitter licenses.

Warranties. We generally warrant that our solutions and related offerings will conform to published specifications, or to specifications provided in an individual customer arrangement, as applicable. The typical warranty period is 90 days from the date of acceptance of the solution or offering. For certain service offerings we provide a warranty for the duration of the services provided. We generally warrant that those services will be performed in a professional and skillful manner. The typical remedy for breach of warranty is to correct or replace any defective deliverable, and if not possible or practical, we will accept the return of the defective deliverable and refund the amount paid under the customer arrangement that is allocable to the defective deliverable. Our contracts also generally contain limitation of damages provisions in an effort to reduce our exposure to monetary damages arising from breach of warranty claims. Historically, we have incurred minimal warranty costs, and as a result, do not maintain a warranty reserve.

Solution and Services Indemnifications. Arrangements with our customers generally include an indemnification provision that will indemnify and defend a customer in actions brought against the customer that claim our products and/or services infringe upon a copyright, trade secret, or valid patent. Historically, we have not incurred any significant costs related to such indemnification claims, and as a result, do not maintain a reserve for such exposure.

Claims for Company Non-performance. Our arrangements with our customers typically limit our liability for breach to a specified amount of the direct damages incurred by the customer resulting from the breach. From time-to-time, these arrangements may also include provisions for possible liquidated damages or other financial remedies for our non-performance, or in the case of certain of our solutions, provisions for damages related to service level performance requirements. The service level performance requirements typically relate to system availability and timeliness of service delivery. As of June 30, 2025, we believe we have adequate reserves, based on our historical experience, to cover any reasonably anticipated exposure as a result of our non-performance for any past or current arrangements with our customers.

Sales and Use Tax. In the ordinary course of business, we are, from time to time, subject to audits performed by state taxing authorities. We continually assess our sales and use tax exposure and as of June 30, 2025, we believe that we have adequate reserves to cover any taxes owed and related penalties and interest. While we believe that the assumptions and estimates used to determine these liabilities are reasonable, the ultimate outcome of these matters cannot be certain, and we will adjust these estimated liabilities as new information becomes available.

Indemnifications Related to Officers and the Board of Directors. Other guarantees include promises to indemnify, defend, and hold harmless our directors, and certain officers. Such indemnification covers any expenses and liabilities reasonably incurred by a person, by reason of the fact that such person is, was, or has agreed to be a director or officer, in connection with the investigation, defense, and settlement of any threatened, pending, or contemplated action, suit, proceeding, or claim. We maintain directors’ and officers’ (“D&O”) insurance coverage to protect against such losses. We have not historically incurred any losses related to these types of indemnifications and are not aware of any pending or threatened actions or claims against any officer or member of our Board of Directors (the "Board"). As a result, we have not recorded any liabilities related to such indemnifications as of June 30, 2025. In addition, as a result of the insurance policy coverage, we believe these indemnification agreements are not significant to our results of operations.

Legal Proceedings. From time to time, we are involved in litigation relating to claims arising out of our operations in the normal course of business.

9. EARNINGS PER COMMON SHARE

Basic and diluted earnings per common share (“EPS”) amounts are presented on the face of our unaudited Condensed Consolidated Statements of Income (the "Income Statements").

The reconciliation of the basic and diluted EPS denominators related to common shares is included in the following table (in thousands):


	Quarter Ended				Six Months Ended
	June 30, 2025		June 30, 2024		June 30, 2025		June 30, 2024
Basic weighted-average common shares		27,843		28,546		27,829		28,531
Dilutive effect of restricted common stock		289		54		370	167
Diluted weighted-average common shares		28,132		28,600		28,199		28,698

The dilutive effect of time-based awards is computed using the treasury stock method. The dilutive effect of performance-based and market-based awards is computed based on the number of shares that would be issued as if the end of the reporting period was the end of the performance period. The dilutive effect of the 2023 Convertible Notes is computed using the if-converted method and will only have an effect in those quarterly periods in which our average stock price exceeds the current effective conversion price.

Potentially dilutive common shares related to non-participating unvested restricted stock were excluded from the computation of diluted EPS, as the effect was anti-dilutive, and were not material in any period presented.

10. STOCKHOLDERS’ EQUITY AND EQUITY COMPENSATION PLANS

Stock Repurchase Program. We currently have a stock repurchase program, approved by our Board, authorizing us to repurchase shares of our common stock from time-to-time as market and business conditions warrant (the “Stock Repurchase Program”). During the second quarters of 2025 and 2024, we repurchased approximately 275,000 shares of our common stock for $17.1 million (weighted-average price of $62.24 per share), and approximately 219,000 shares of our common stock for $9.7 million (weighted-average price of $44.32 per share), respectively, under a SEC Rule 10b5-1 Plan. During the six months ended June 30, 2025 and 2024, we repurchased approximately 428,000 shares of our common stock for $26.7 million (weighted-average price of $62.39 per share), and approximately 404,000 shares of our common stock for $19.3 million (weighted-average price of $47.82 per share), respectively, under a SEC Rule 10b5-1 Plan. The excise tax imposed on share repurchases, which is included as a cost of treasury stock, is not reflected in these amounts.

As of June 30, 2025, the total remaining value of shares available for repurchase under the Stock Repurchase Program totaled $111.3 million, with the amount authorized for repurchase through December 31, 2025.

Stock Repurchases for Tax Withholdings. In addition to the above-mentioned stock repurchases, during the second quarters of 2025 and 2024, we repurchased and then cancelled approximately 15,000 shares of common stock for $1.0 million and approximately 9,000 shares of common stock for $0.4 million, respectively, and six months ended June 30, 2025 and 2024, we repurchased and then cancelled approximately 219,000 shares of common stock for $13.8 million and approximately 168,000 shares of common stock for $8.9 million, respectively, in connection with minimum tax withholding requirements resulting from the vesting of restricted common stock under our stock incentive plan.

Cash Dividends. During the second quarter of 2025, our Board approved a quarterly cash dividend of $0.32 per share of common stock, totaling $9.2 million. During the second quarter of 2024, our Board approved a quarterly cash dividend of $0.30 per share of common stock, totaling $8.8 million. Dividends declared for the six months ended June 30, 2025 and 2024 totaled $18.6 million and $17.6 million, respectively. As of June 30, 2025 and 2024, we had $10.4 million and $1.6 million, respectively, of dividends accrued, which are included in other current and non-current liabilities on our Balance Sheets. The increase in accrued dividends for 2025 relates primarily to our second quarter of 2025 dividends that were declared in June, but will be paid in July.

Stock-Based Awards. During the six months ended June 30, 2025 we granted restricted stock awards to key members of management in the form of: (i) performance-based awards of approximately 170,000 restricted common stock shares, of which the majority will vest in the first quarter of 2027 upon meeting certain pre-established financial performance objectives over a two-year performance period; and (ii) market-based awards of approximately 51,000 restricted common stock shares, which vest in the first quarter of 2028 upon meeting a relative total shareholder return performance achievement tier. Certain of these awards may vest (i.e., vesting accelerates) upon the involuntary termination of employment or a change in control (as defined) and the subsequent involuntary termination of employment.

During the six months ended June 30, 2025, we also granted restricted stock awards to key members of management in the form of time-based awards of approximately 391,000 restricted common stock shares, which vest annually over three years with no restrictions other than the passage of time. Certain of these awards may vest (i.e., vesting accelerates) upon the involuntary termination of employment, a change in control (as defined) and the subsequent involuntary termination of employment, or death.

We recorded stock-based compensation expense for the second quarters of 2025 and 2024 of $8.6 million for both periods, and for the six months ended June 30, 2025 and 2024 of $17.0 million and $16.4 million, respectively.

11. SUBSEQUENT EVENT

On July 5, 2025, CSG terminated a master services agreement (the “MSA”) for one of our implementation projects in the Latin America region on the basis that the customer unlawfully renounced its obligations under the MSA. At this time, there is no work being performed on the project and CSG intends to pursue any and all available remedies.

During the six months ended June 30, 2025, we recognized $1.4 million in revenue related to this project. As of June 30, 2025, we had accounts receivable of $18.5 million ($1.4 million billed and $17.1 million unbilled) related to this project. As of the date of this filing, CSG does not believe there has been an impairment to the carrying values of the assets and believes such amounts are recoverable per the terms of the MSA or as a matter of common law.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The information contained in this MD&A should be read in conjunction with the Financial Statements and Notes thereto included in this Form 10-Q and the audited consolidated financial statements and notes thereto in our 2024 10-K.

Forward-Looking Statements

This report contains a number of forward-looking statements relative to our future plans and our expectations concerning our business and the industries we serve. These forward-looking statements are based on assumptions about a number of important factors and involve risks and uncertainties that could cause actual results to differ materially from estimates contained in the forward-looking statements. Some of the risks that are foreseen by management are outlined within Part I, Item 1A. Risk Factors of our 2024 10-K. Readers are strongly encouraged to review that section closely in conjunction with MD&A.

Company Overview

We are a purpose-driven SaaS platform company that enables global companies in a wide variety of industry verticals to simplify their complex customer engagement and how they monetize in the digital age. Our industry leading revenue management and digital monetization, customer experience, and payments solutions make ordinary customer experiences extraordinary. Our cloud-first architecture and customer-centric approach help companies around the world acquire, monetize, engage, and retain the B2B (business-to-business), B2C (business-to-consumer), and B2B2X (business-to-business-to-consumer) customers. As brands reimagine their engagement strategies in an increasingly connected world, we sit at the center of a complex, multi-sided business model ensuring monetization and customer engagement is handled at all levels of the ecosystem.

We leverage 40 years of experience to deliver innovative customer engagement solutions for every stage of the customer lifecycle so our customers can deliver an outstanding customer experience that adapts to their customers’ rapidly changing demands. Our diverse, worldwide workforce draws from real-world knowledge and extensive expertise to design and implement business solutions that make our customers’ hardest decisions simpler so that they can focus on delivering differentiated and real-time experiences to their customers. As a global technology leader, we aspire to envision, invent, and shape a better, more future-ready world.

We focus our research and development (“R&D”) and acquisition investments on expanding our offerings in a timely and efficient manner to address the complex, transformative needs of our customers. Our scalable, modular, and flexible solutions combined with our domain expertise and our ability to effectively migrate customers to our solutions, provide the industry with proven solutions to improve their profitability and consumers’ experiences. We have specifically architected our solutions to offer a phased, incremental approach to transforming our customers' businesses, thereby reducing the business interruption risk associated with this evolution.

As discussed in Note 2 to our Financial Statements, we generate a majority of our revenue from the global communications markets; however, we serve an expanding group of customers in other markets including retail, financial services, healthcare, insurance, and government entities.

We are a member of the S&P Small Cap 600 and Russell 2000 indices.

Macroeconomic Outlook

Current geopolitical and economic uncertainties, including inflation, tariffs and changes in trade policy, supply chain disruptions, and labor shortages, could adversely affect our business. The potential impact to our business could depend on multiple factors, including the duration and potential expansion of tariffs, retaliatory measures by impacted exporting countries, inflationary effects, and broader macroeconomic responses. Because we cannot predict the impact these events could have on current economic conditions or our business, there is no assurance that we will be able to fully mitigate the financial and competitive impacts related to such uncertainties, any of which could have a material adverse effect on our results of operations.

Management Overview of Quarterly Results

Second Quarter Highlights. A summary of our results of operations for the second quarter of 2025, when compared to the second quarter of 2024, was as follows (in thousands, except per share amounts and percentages):


	Quarter Ended
	June 30, 2025			June 30, 2024
Revenue	$	297,128		$	290,318
Transaction fees (1)		25,866			24,207
Operating results:
Operating income	$	29,857		$	25,420
Operating margin percentage		10.0	%		8.8	%
Diluted EPS	$	0.44		$	0.48
Supplemental data:
Restructuring and reorganization charges (2)	$	4,588		$	7,099
Acquisition-related costs:
Amortization of acquired intangible assets		3,458			3,393
Earn-out compensation		7,806			-
Transaction-related costs		-			1,036
Stock-based compensation (2)		8,762			9,193

(1)

Transaction fees are primarily comprised of fees paid to third-party payment processors and financial institutions and interchange fees under our payment services contracts. Transaction fees are included in revenue on our Income Statement (and not netted against revenue) because we maintain control and act as the principal over the integrated service provided under our payment services customer contracts.

(2)

Restructuring and reorganization charges include stock-based compensation, which is not included in the stock-based compensation line in the table above, and depreciation, which has not been recorded to the depreciation line on our Income Statement.

Revenue. Revenue for the second quarter of 2025 was $297.1 million, a 2.3% increase when compared to revenue of $290.3 million for the second quarter of 2024. The increase in revenue was primarily attributed to the continued growth of our SaaS and related solutions revenue, to include the revenue generated from the iCG business acquired in June of 2024.

Operating Results. Operating income for the second quarter of 2025 was $29.9 million, or a 10.0% operating margin percentage, compared to $25.4 million, or an 8.8% operating margin percentage for the second quarter of 2024. The increase in operating income was mainly attributed to the decrease in restructuring and reorganization charges between years along with the benefits received from the cost efficiency actions taken during 2024 and the first six months of 2025 to optimize and align resources to areas of the business with higher growth profiles.

Diluted EPS. Diluted EPS for the second quarter of 2025 was $0.44 compared to $0.48 for the second quarter of 2024, with the decrease mainly attributed to a higher effective income tax rate in the second quarter of 2025 due primarily to the increase in earn-out compensation related to the DGIT acquisition, for which a valuation allowance has been established for income tax purposes.

Cash and Cash Flows. As of June 30, 2025, we had cash and cash equivalents of $145.9 million, as compared to $136.0 million as of March 31, 2025 and $161.8 million as of December 31, 2024. Our cash flows provided by operating activities for the second quarter of 2025 were $48.8 million. See the Liquidity section below for further discussion of our cash flows.

Significant Customer Relationships

A large percentage of our revenue is generated from a limited number of customers in the global communications industry, with our three largest customers being Charter, Comcast, and DISH Network L.L.C.

Customer Concentration. We have significant customer concentration, with the following two customers exceeding 10% of our revenue (in thousands, except percentages):


	Quarter Ended
	June 30, 2025					March 31, 2025					June 30, 2024
	Amount		% of Revenue			Amount		% of Revenue			Amount		% of Revenue
Charter	$	57,667		19	%	$	57,602		19	%	$	60,629		21	%
Comcast		51,415		17	%		52,759		18	%		54,576		19	%

The percentages of net billed accounts receivable balances attributable to these customers as of the dates indicated were as follows:


	As of
	June 30, 2025			March 31, 2025			December 31, 2024
Charter		19	%		20	%		20	%
Comcast		17	%		17	%		17	%

See our 2024 10-K for additional discussion of our business relationships and contractual terms with Charter and Comcast.

Risk of Customer Concentration. We expect to continue to generate a large percentage of our future revenue from a limited number of customers. There are inherent risks whenever a large percentage of total revenue is concentrated with a limited number of customers. Should a significant customer: (i) terminate or fail to renew their contracts with us, in whole or in part, for any reason; (ii) significantly reduce the number of customer accounts processed on our solutions, the price paid for our services, or the scope of services that we provide; or (iii) experience financial or operating difficulties, it could have a material adverse effect on our financial position and results of operations.

Contract Termination

It is customary for us to enter into software implementation projects with certain customers. These implementation projects range from relatively short and noncomplex projects to long and complex projects, ranging from several months to several years in duration depending on the specifics of the project.

During the six months ended June 30, 2025, we recognized $1.4 million in revenue related to this project. CSG does not expect the termination of this contract to have a material impact on 2025 revenue. As of June 30, 2025, we had accounts receivable of $18.5 million ($1.4 million billed and $17.1 million unbilled) related to this project. As of the date of this filing, CSG does not believe there has been an impairment to the carrying values of the assets and believes such amounts are recoverable per the terms of the MSA or as a matter of common law. However, if we are not successful in collecting the amount expected under the terms of the MSA or as a matter of common law, it is possible that an impairment of these assets could result.

Critical Accounting Policies and Estimates

The preparation of our Financial Statements in conformity with U.S. GAAP requires us to select appropriate accounting policies, and to make judgments and estimates affecting the application of those accounting policies. On an ongoing basis, we evaluate our estimates and assumptions. In applying our accounting policies and estimates, different business conditions or the use of different assumptions may result in materially different amounts reported in our Financial Statements.

We have identified the most critical accounting policies and estimates that affect our financial position and the results of our operations. Those critical accounting policies and estimates were determined by considering the accounting policies that involve the most complex or subjective decisions or assessments. The most critical accounting policies and estimates identified relate to the following items: (i) revenue recognition; (ii) income taxes; and (iii) loss contingencies. These critical accounting policies, as well as our other significant accounting policies, are discussed in our 2024 10-K.

Results of Operations

Revenue. Total revenue for the: (i) second quarter of 2025 was $297.1 million, a 2.3% increase when compared to $290.3 million for the second quarter of 2024; and (ii) six months ended June 30, 2025 was $596.6 million, a 1.9% increase when compared to $585.5 million for the six months ended June 30, 2024.

Revenue by type for the second quarters and six months ended June 30, 2025 and 2024 was as follows (in thousands):


	Quarter Ended				Six Months Ended
	June 30, 2025		June 30, 2024		June 30, 2025		June 30, 2024
SaaS and related solutions	$	269,548	$	262,658	$	539,488	$	524,353
Software and services		16,290		14,681		34,913		37,075
Maintenance		11,290		12,979		22,180		24,025
Total revenue	$	297,128	$	290,318	$	596,581	$	585,453

The increases in revenue were primarily due to the continued growth of our SaaS and related solutions revenue, to include the revenue generated from the businesses acquired during the second quarter of 2024. Additionally, revenue for the second quarter of 2025 includes approximately $6 million of revenue recognized from a software license arrangement, which was offset by lower professional services revenue.

We use the location of the customer as the basis of attributing revenue to individual countries. Revenue by geographic regions for the second quarters and six months ended June 30, 2025 and 2024 was as follows (in thousands):


	Quarter Ended				Six Months Ended
	June 30, 2025		June 30, 2024		June 30, 2025		June 30, 2024
Americas (principally the U.S.)	$	253,164	$	258,035	$	512,511	$	512,573
Europe, Middle East, and Africa		31,855		18,989		58,890		45,818
Asia Pacific		12,109		13,294		25,180		27,062
Total revenue	$	297,128	$	290,318	$	596,581	$	585,453

Total Operating Expenses. Total operating expenses for the: (i) second quarter of 2025 were $267.3 million, a 0.9% increase when compared to $264.9 million for the second quarter of 2024; and (ii) six months ended June 30, 2025 were $537.3 million, a 1.7% increase when compared to $528.2 million for the six months ended June 30, 2024. The increases in total operating expenses were primarily a result of the increases in acquisition-related expenses, mainly attributed to the approximately $7 million of DGIT earn-out compensation recognized in the second quarter of 2025, along with the additional costs of the acquired businesses. These additional costs were offset to a certain degree by the cost efficiency actions taken during 2024 and the first six months of 2025 to optimize capacity and align resources to areas of the business with higher growth profiles.

The components of total operating expenses are discussed in more detail below.

Cost of Revenue (Exclusive of Depreciation). The cost of revenue for the: (i) second quarter of 2025 was $150.1 million, a 1.8% decrease when compared to $152.9 million for the second quarter of 2024; and (ii) six months ended June 30, 2025 was $304.6 million, a 2.0% decrease when compared to $310.8 million for the six months ended June 30, 2024. These decreases in cost of revenue are mainly attributed to lower employee-related costs, due to the reallocation of resources to development projects, deferred costs related to SaaS implementation projects, and our cost efficiency actions, discussed above. These decreases are partially offset by the increased costs reflective of the increases in SaaS and related solutions revenue between periods, to include the acquired businesses. Total cost of revenue as a percentage of revenue for the: (i) second quarters of 2025 and 2024 was 50.5% and 52.7%, respectively; and (ii) six months ended June 30, 2025 and 2024 was 51.1% and 53.1%, respectively.

R&D Expense (Exclusive of Depreciation). R&D expense for the: (i) second quarter of 2025 was $40.4 million, a 5.2% increase when compared to $38.4 million for the second quarter of 2024; and (ii) six months ended June 30, 2025 was $81.3 million, a 9.1% increase when compared to $74.5 million for the six months ended June 30, 2024. The increases in R&D expense between periods are attributed primarily to increased R&D investments in our faster growing SaaS solutions, such as Ascendon monetization and payments, and the impact of the acquisitions that we closed in 2024. Delivering future-ready solutions that have best-in-industry innovation (including new AI capabilities) is a key competitive advantage for us. As a percentage of total revenue, R&D expense for the: (i) second quarters of 2025 and 2024 was 13.6% and 13.2%, respectively; and (ii) six months ended June 30, 2025 and 2024 was 13.6% and 12.7%, respectively.

Selling, General, and Administrative ("SG&A") Expense (Exclusive of Depreciation). SG&A expense for the: (i) second quarter of 2025 was $67.5 million, a 10.4% increase when compared to $61.2 million for the second quarter of 2024; and (ii) six months ended June 30, 2025 was $129.8 million, a 5.7% increase when compared to $122.9 million for the six months ended June 30, 2024. These increases are mainly attributed to approximately $7 million of DGIT earn-out compensation recognized in the second quarter of 2025. As a percentage of total revenue, SG&A expense for the: (i) second quarters of 2025 and 2024 was 22.7% and 21.1%, respectively; and (ii) six months ended June 30, 2025 and 2024 was 21.8% and 21.0%, respectively.

Restructuring and Reorganization Charges. Restructuring and reorganization charges for the: (i) second quarter of 2025 were $4.6 million, a $2.5 million decrease when compared to $7.1 million for the second quarter of 2024; and (ii) six months ended June 30, 2025 was $12.0 million, a $2.9 million increase when compared to $9.1 million for the six months ended June 30, 2024. The restructuring and reorganization charges for the six months ended June 30, 2025 relate mainly to cost efficiency actions to optimize our capacity and better align resources along with costs associated with the closure of our design and delivery center in Crawfordville, Florida. These activities have resulted in restructuring charges of $9.7 million related to involuntary terminations.

See Note 7 to our Financial Statements for additional discussion.

Operating Income. Operating income for the: (i) second quarter of 2025 was $29.9 million, or 10.0% of total revenue, compared to $25.4 million, or 8.8% of total revenue for the second quarter of 2024; and (ii) six months ended June 30, 2025 was $59.2 million, or 9.9% of total revenue, compared to $57.2 million, or 9.8% of total revenue, for the six months ended June 30, 2024. The increases in operating income are mainly attributed to the benefits received from the cost efficiency actions taken during 2024 and the first six months of 2025 to optimize and align resources to areas of the business with higher growth profiles.

Interest Income. Interest income for the: (i) second quarter of 2025 was $1.1 million, a $1.0 million decrease when compared to $2.1 million for the second quarter of 2024; and (ii) six months ended June 30, 2025 was $3.0 million, a $1.7 million decrease when compared to $4.7 million for the six months ended June 30, 2024. These decreases are primarily attributed to lower cash balances being swept into overnight money market accounts on a daily basis.

Loss on Extinguishment of Debt. In March 2025, we entered into the 2025 Credit Agreement, which replaced the 2021 Credit Agreement (see Note 5 to our Financial Statements). As a result, we incurred a loss of $0.5 million related to the write-off of debt issuance costs.

Other, net. Other, net for the: (i) second quarter of 2025 was $3.6 million of other expense, a $3.8 million change from $0.2 million of other income for the second quarter of 2024; and (ii) six months ended June 30, 2025 was $5.8 million of other expense, a $6.5 million change when compared to $0.7 million of other income for the six months ended June 30, 2024. These changes were primarily attributed to foreign currency movements.

Income Tax Provision. The effective income tax rates for the: (i) second quarters of 2025 and 2024 were 38% and 31%, respectively; and (ii) six months ended June 30, 2025 and 2024 were 31% and 30%, respectively. Our estimated full year 2025 effective income tax rate is approximately 30%, with the increase in the full year rate attributed to the DGIT earn-out compensation, for which a valuation allowance has been established for income tax purposes (see Note 6 for further discussion of the DGIT earn-out payments).

Liquidity

Cash and Liquidity. As of June 30, 2025, our principal sources of liquidity included cash and cash equivalents of $145.9 million, compared to $136.0 million as of March 31, 2025, and $161.8 million as of December 31, 2024.

During the first quarter of 2025, we entered into the 2025 Credit Agreement, which consists of a $600.0 million five-year revolver, the 2025 Revolver, which replaced our $600.0 million five-year credit agreement entered into September 2021, the 2021 Credit Agreement. As of June 30, 2025, we had $125.0 million outstanding on the 2025 Revolver. The 2025 Credit Agreement contains customary affirmative, negative, and financial covenants. As of June 30, 2025, and the date of this filing, we believe we are in compliance with the provisions of the 2025 Credit Agreement.

Our cash and cash equivalents balances as of the end of the indicated periods were located in the following geographical regions (in thousands):


	June 30, 2025		December 31, 2024
Americas (principally the U.S.)	$	89,023	$	102,417
Europe, Middle East, and Africa		41,089		43,609
Asia Pacific		15,763		15,763
Total cash and cash equivalents	$	145,875	$	161,789

We generally have ready access to substantially all of our cash and cash equivalents, but may face limitations on moving cash out of certain foreign jurisdictions due to currency controls and potential negative economic consequences.

As of June 30, 2025 and December 31, 2024, we had $1.8 million and $1.7 million, respectively, of cash restricted as to use primarily to collateralize guarantees included in our non-current asset balance. In addition, as of June 30, 2025 and December 31, 2024, we had $256.1 million and $343.2 million, respectively, of settlement and merchant reserve assets which are deemed restricted due to contractual restrictions with the merchants and restrictions arising from our policy and intention. It has historically been our policy to segregate settlement and merchant reserve assets from our operating cash balances and we intend to continue to do so.

Cash Flows from Operating Activities. We calculate our cash flows from operating activities beginning with net income, adding back the impact of non-cash items or non-operating activity (e.g., depreciation, amortization, impairments, gain/loss on items such as investments, lease modifications, and debt extinguishments/conversions, unrealized foreign currency transactions gain/loss, deferred income taxes, stock-based compensation, etc.), and then factoring in the impact of changes in operating assets and liabilities. See our 2024 10-K for a description of the primary uses and sources of our cash flows from operating activities.

Our cash flows from operating activities, broken out between operations and changes in operating assets and liabilities, for the indicated quarterly periods are as follows (in thousands):


	Operations		Changes in Operating Asset and Liabilities			Net Cash Provided by (Used In) Operating Activities – Totals
Cash Flows from Operating Activities:
2025:
March 31 (1)	$	40,619	$	(29,150	)	$	11,469
June 30		38,999		(1,673	)		37,326
Total	$	79,618	$	(30,823	)	$	48,795

2024:
March 31 (2)	$	51,655	$	(81,006	)	$	(29,351	)
June 30		35,625		7,480			43,105
Total	$	87,280	$	(73,526	)	$	13,754

(1)

Cash flows from operating activities for the first quarter of 2025 reflect the impact of the payment of the 2024 year-end accrued employee incentive compensation.

(2)

Cash flows from operating activities for the first quarter of 2024 were negatively impacted by unfavorable working capital changes, to include the impact of the payment of the 2023 year-end accrued employee incentive compensation and timing of trade accounts receivable.

Variations in our net cash provided by (used in) operating activities are generally related to the changes in our operating assets and liabilities (related mostly to fluctuations in timing of customer payments and changes in accrued expenses), and generally over longer periods of time, do not significantly impact our cash flows from operations.

Significant fluctuations in key operating assets and liabilities between 2025 and 2024 that impacted our cash flows from operating activities are as follows:

Billed Trade Accounts Receivable

Management of our billed trade accounts receivable is one of the primary factors in maintaining strong cash flows from operating activities. These balances include significant billings for several non-revenue items (primarily postage, sales tax, and deferred revenue items). As a result, we evaluate our performance in collecting our billed trade accounts receivable through our calculation of Days Billings Outstanding (“DBO”) rather than a typical Days Sales Outstanding (“DSO”) calculation.

Our gross and net billed trade accounts receivable and related allowance for expected losses (“Allowance”) as of the end of the indicated quarterly periods, and the related DBOs for the quarters then ended, are as follows (in thousands, except DBOs):


Quarter Ended	Gross		Allowance			Net Billed		DBOs
2025:
March 31	$	269,326	$	(4,152	)	$	265,174		66
June 30		262,975		(3,959	)		259,016		66

2024:
March 31	$	281,051	$	(5,692	)	$	275,359		67
June 30		270,934		(4,720	)		266,214		66

As of June 30, 2025 and 2024, approximately 94% and 95%, respectively, of our net billed trade accounts receivable balances were less than 60 days past due.

We may experience adverse impacts to our DBOs if and when customer payment delays occur. However, the recurring monthly payments that cross a reporting period-end do not raise collectability concerns, as payment is generally received subsequent to quarter-end. All other changes in our gross and net billed accounts receivable reflect the normal fluctuations in the timing of customer payments at quarter-end, as evidenced by our relatively consistent DBO metric.

As a global provider of solutions and services, a portion of our trade accounts receivable balance relates to international customers. This diversity in the geographic composition of our customer base may adversely impact our DBOs as longer billing cycles (i.e., billing terms and cash collection cycles) are an inherent characteristic of international software and professional services transactions. As a result, we may experience fluctuations in our trade accounts receivable balance as our ability to invoice and collect arrangement fees is dependent upon, among other things: (i) the completion of various customer administrative matters, local country billing protocols and processes (including local cultural differences), and non-customer administrative matters; (ii) meeting certain contractual invoicing milestones and dates; (iii) the overall project status in certain situations in which we act as a subcontractor to another vendor on a project; or (iv) currency controls in certain foreign jurisdictions.

Unbilled Trade Accounts Receivable

Unbilled trade accounts receivable (current and non-current) increased $10.6 million to $90.8 million as of June 30, 2025, from $80.2 million as of December 31, 2024. These unbilled trade accounts receivable balances relate primarily to implementation projects where various milestone billing dates have not yet been reached or are delayed and to timing related to billing cutoff or contractual billing dates. As discussed in Contract Termination above, as of June 30, 2025, $17.1 million of the unbilled trade accounts receivable balance is related to one of our implementation projects. Unbilled trade accounts receivable are an inherent characteristic of certain software and services transactions and may fluctuate between quarters, as these types of transactions typically have scheduled invoicing terms over several quarters, as well as certain milestone billing events.

Income Taxes Receivable/Payable

Net income taxes receivable/payable (current and non-current) as of June 30, 2025 was a net income taxes receivable balance of $7.8 million, compared to a net income taxes payable balance of $7.9 million at December 31, 2024. This net $15.7 million change was primarily due to the timing of our estimated federal and state income tax payments.

Accrued Employee Compensation

Accrued employee compensation decreased $6.9 million to $61.0 million as of June 30, 2025, from $67.9 million as of December 31, 2024, due primarily to the payment of 2024 employee incentive compensation during the first quarter of 2025 that was fully accrued at December 31, 2024, partially offset by the accrual for 2025 employee incentive compensation.

Cash Flows from Investing Activities. Our typical investing activities consist of purchases of software, property, and equipment, which are discussed below.

Purchases of Software, Property, and Equipment

Our capital expenditures for the six months ended June 30, 2025 and 2024 for software, property, and equipment were $7.2 million and $9.1 million, respectively, and consisted principally of investments in software and related equipment.

Business Combinations, Net of Cash and Settlement Assets Acquired

The cash paid for the businesses acquired during the second quarter of 2024, less cash and settlement assets acquired, resulted in net cash provided by business combinations for the six months ended June 30, 2024 of $17.3 million.

Cash Flows from Financing Activities. Our financing activities typically consist of activities with our common stock, various debt-related transactions, and settlement and merchant reserve activity.

Cash Dividends Paid on Common Stock

During the six months ended June 30, 2025 and 2024, our Board approved dividends totaling $18.6 million and $17.6 million, respectively, and we made dividend payments of $18.5 million and $18.1 million, respectively, with the differences between the amount approved and paid attributed to dividends accrued on unvested incentive shares that are paid upon vesting.

Repurchase of Common Stock

During the six months ended June 30, 2025 and 2024, we repurchased approximately 428,000 and 404,000 shares of our common stock, respectively, under our Stock Repurchase Program for $26.7 million and $19.3 million, respectively.

Additionally, outside of our Stock Repurchase Program, during the six months ended June 30, 2025 and 2024, we repurchased from our employees and then canceled approximately 219,000 and 168,000 shares of our common stock, respectively, for $13.8 million and $8.9 million, respectively, in connection with minimum tax withholding requirements resulting from the vesting of restricted stock under our stock incentive plans.

Through the six months ended June 30, 2025 and 2024, we paid $40.5 million and $27.9 million, respectively, for our total repurchases of common stock, with any differences when compared to the amounts purchased attributed to the timing of the settlement and the excise tax imposed on share repurchases.

See Note 10 to our Financial Statements for additional discussion of our repurchases of common stock.

Long-Term Debt

During the first quarter of 2025, we borrowed $10.0 million from our 2021 Revolver for general corporate purposes. In March 2025, we entered into the 2025 Credit Agreement and as a result, we borrowed $140.6 million under the 2025 Revolver and repaid: (i) the outstanding 2021 Term Loan principal balance of $125.6 million; (ii) the outstanding 2021 Revolver balance of $10.0 million; and (iii) $2.3 million of debt financing costs; with the remainder used for general corporate purposes. Subsequently, we have repaid $15.6 million of the 2025 Revolver, leaving us with an outstanding balance of $125.0 million.

During the second quarter of 2024, we made principal repayments on our 2021 Term Loan of $3.8 million.

See Note 5 to our Financial Statements for additional discussion of our long-term debt.

Settlement and Merchant Reserve Activity

During the six months ended June 30, 2025 and 2024, we had net settlement and merchant reserve activity of $(89.1) million and $(88.7) million, respectively, related to the cash collected, held on behalf, and paid to our merchants related to our payments services and the net change in deposits held on behalf of our merchants. These balances can significantly fluctuate between periods due to activity at the end of the period and the day in which the period ends.

See Note 2 to our Financial Statements for additional discussion of our settlement and merchant reserves.

Off-Balance Sheet Arrangements

Our off-balance sheet arrangements are mainly limited to money transmitter bonds and performance bonds. These arrangements do not have a material impact and are not reasonably likely to have a material future impact to our financial condition, results of operations, liquidity, capital expenditures, or capital resources. See Note 8 to our Financial Statements for additional information on these guarantees.

Capital Resources

The following are the key items to consider in assessing our sources and uses of capital resources:

Current Sources of Capital Resources. Below are the key items to consider in assessing our current sources of capital resources:

•

Cash and Cash Equivalents. As of June 30, 2025, we had cash and cash equivalents of $145.9 million, of which approximately 58% was in U.S. dollars and held in the U.S. For the remainder of the monies denominated in foreign currencies and/or located outside the U.S., we do not anticipate any material amounts being unavailable for use in funding our business, but may face limitations on moving cash out of certain foreign jurisdictions due to currency controls and potential negative economic consequences.

•

Operating Cash Flows. As described in the Liquidity section above, we believe we have the ability to generate strong cash flows to fund our operating activities and act as a source of funds for our capital resource needs, although we may experience quarterly variations in our cash flows from operations related to the changes in our operating assets and liabilities.

•

Revolving Loan Facility. In March 2025, we entered into the 2025 Credit Agreement which replaced our 2021 Credit Agreement. The 2025 Credit Agreement consists of a $600.0 million revolving loan facility, our 2025 Revolver. As of June 30, 2025, we had $125.0 million outstanding on the 2025 Revolver, leaving $475.0 million available to us. Our long-term debt obligations are discussed in more detail in Note 5 to our Financial Statements.

Uses/Potential Uses of Capital Resources. Below are the key items to consider in assessing our uses/potential uses of capital resources:

•

Common Stock Repurchases and Cash Dividends. We have made repurchases of our common stock in the past under our Stock Repurchase Program. As of June 30, 2025, we had $111.3 million authorized for repurchase remaining under our Stock Repurchase Program, with all outstanding authorized repurchases to be completed by December 31, 2025. Our 2025 Credit Agreement places certain limitations on our ability to repurchase our common stock.

Under our Stock Repurchase Program, we may repurchase shares in the open market or in privately negotiated transactions, including through an accelerated stock repurchase plan or under a SEC Rule 10b5-1 plan. The actual timing and amount of share repurchases are dependent on the current market conditions and other business-related factors. Our common stock repurchases are discussed in more detail in Note 10 to our Financial Statements.

During the six months ended June 30, 2025, we repurchased approximately 428,000 shares of our common stock for $26.7 million (weighted-average price of $62.39 per share) under our Stock Repurchase Program.

Outside of our Stock Repurchase Program, during the six months ended June 30, 2025, we repurchased from our employees and then cancelled approximately 219,000 shares of our common stock for $13.8 million in connection with minimum tax withholding requirements resulting from the vesting of restricted common stock under our stock incentive plans.

During the six months ended June 30, 2025, our Board declared dividends totaling $18.6 million. Going forward, we expect to pay cash dividends each year in January, April, July, and October, with the amount and timing subject to our Board’s approval.

We expect to return in excess of $100.0 million to our shareholders through combined common stock repurchases and cash dividends in 2025.

•

Acquisitions. As a result of our previous acquisition activity, during the six months ended June 30, 2025 we made $0.3 million of deferred acquisition payments. Additionally, there are provisions for potential future earn-out payments of up to approximately $12 million for DGIT and $15.0 million for iCG tied to performance-based goals and a defined service period. The earn-out periods are through December 31, 2026 and June 3, 2027, respectively. During the six months ended June 30, 2025 we made earn-out payments of $5.1 million, which are included in our cash flows from operating activities. As of June 30, 2025, we have accrued $11.5 million related to potential future earn-out payments.

As part of our growth strategy, we are continually evaluating potential business and/or asset acquisitions and investments in market share expansion with our existing and potential new customers and expansion into verticals outside the global communications market.

•

Exit of Reseller Agreements. During 2023, we exited out of two reseller agreements that were acquired with the 2018 acquisition of Forte Payment Systems, Inc., at a total cost of $9.9 million, of which $1.8 million was paid in 2023 and $5.6 million was paid in 2024. We paid $1.3 million during the six months ended June 30, 2025, with the remaining $1.2 million to be paid in 2026.

•

Capital Expenditures. During the six months ended June 30, 2025, we spent $7.2 million on capital expenditures.

•

Financing Agreements. We have financing agreements for certain of our internal use software. As of June 30, 2025, we have $11.8 million related to these financing agreements included in current and non-current liabilities on our Balance Sheets. During the six months ended June 30, 2025, we have made payments of $3.6 million related to these financing agreements.

During the first quarter of 2025, we entered into a new agreement with our outsourced data center environment provider in which we elected to maintain our current data center environment through 2028. As a result, the lease classification of the data center environment was reassessed and accounted for as a finance lease. As a result, as of June 30, 2025, we have a finance lease right-of-use asset of $10.6 million. During the six months ended June 30, 2025, we have made finance lease payments of $0.9 million.

•

Long-Term Debt. As of June 30, 2025, our long-term debt consisted of the following: (i) 2025 Credit Agreement revolver borrowings of $125.0 million; and (ii) 2023 Convertible Notes in the principal aggregate amount of $425.0 million.

2025 Credit Agreement. The mandatory payments under our 2025 Credit Agreement for the next twelve months are the cash interest expense (based upon then-current interest rates) for the 2025 Revolver (assuming no further amounts are borrowed, and the amount is not paid down) of $7.3 million.

2023 Convertible Notes. The 2023 Convertible Notes are convertible at the option of the note holders before June 15, 2028 upon the occurrence of certain events, however, there are no scheduled conversion triggers over the next twelve months. As a result, we expect our required debt service cash outlay during the next twelve months for the 2023 Convertible Notes to be limited to interest payments of $16.5 million.

Our long-term debt obligations are discussed in more detail in Note 5 to our Financial Statements.

In summary, we expect to continue to have material needs for capital resources going forward, as noted above. We believe that our current cash and cash equivalents balances and our 2025 Revolver, together with cash expected to be generated in the future from our current operating activities, will be sufficient to meet our anticipated capital resource requirements for at least the next twelve months. We believe we could obtain additional capital through refinancing options or other debt sources which may be available to us if deemed appropriate.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Market risk is the potential loss arising from adverse changes in market rates and prices. As of June 30, 2025, we are exposed to various market risks, including changes in interest rates, fluctuations and changes in the market value of our cash equivalents and settlement and merchant reserve assets, and changes in foreign currency exchange rates. We have not historically entered into derivatives or other financial instruments for trading or speculative purposes.

Interest Rate Risk

Long-Term Debt. The interest rate on our 2023 Convertible Notes is fixed, and thus, as it relates to our convertible debt borrowings, we are not exposed to changes in interest rates.

The interest rates on our 2025 Credit Agreement are based upon an adjusted SOFR rate (including a 0.10% credit spread adjustment) plus an applicable margin, or an ABR plus an applicable margin. See Note 5 to our Financial Statements for further details related to our long-term debt.

A hypothetical adverse change of 10% in the June 30, 2025 adjusted SOFR rate would not have a material impact upon our results of operations.

Market Risk

Cash and Cash Equivalents. Our cash and cash equivalents as of June 30, 2025 and December 31, 2024 were $145.9 million and $161.8 million, respectively. Certain of our cash balances are swept into overnight money market accounts on a daily basis, and at times, excess funds may be invested in low-risk institutional money market funds held at a major bank. We have minimal market risk for our cash and cash equivalents due to the relatively short maturities of the instruments.

Settlement and Merchant Reserve Assets. We are exposed to market risk associated with cash held on behalf of our merchants related to our payment processing services. As of June 30, 2025 and December 31, 2024, we had $256.1 million and $343.2 million, respectively, of cash collected on behalf of our merchants. The cash is held in accounts with various major financial institutions in the U.S. and Canada in an amount equal to at least 100% of the aggregate amount owed to our merchants. These balances can significantly fluctuate between periods due to activity at the end of the period and the day in which the period ends. Certain settlement assets are swept into overnight money market accounts on a daily basis.

Long-Term Debt. The fair value of our convertible debt is exposed to market risk. We do not carry our convertible debt at fair value but present the fair value for disclosure purposes (see Note 2 to our Financial Statements). Generally, the fair value of our convertible debt is impacted by changes in interest rates and changes in the price and volatility of our common stock. As of June 30, 2025, the fair value of the 2023 Convertible Notes was estimated at $481.3 million, using quoted market prices.

Foreign Currency Exchange Rate Risk

Due to foreign operations around the world, our financial statements are exposed to foreign currency exchange risk due to the fluctuations in the value of currencies in which we conduct business. Our principal currency exposures include the British Pound, Euro, Australian Dollar, Saudi Riyal, and South African Rand. While we attempt to maximize natural hedges by incurring expenses in the same currency in which we contract revenue, the related expenses for that revenue could be in one or more differing currencies than the revenue stream. In particular, if the U.S. Dollar were to strengthen it would reduce the reported amount of our foreign-denominated cash, cash equivalents, trade receivables, revenue, and expenses that we translate into U.S. Dollars and report in our consolidated financial statements for, and as of the end of, each reporting period.

During the six months ended June 30, 2025, we generated approximately 88% of our revenue in U.S. dollars. We expect that, in the foreseeable future, we will continue to generate a very large percentage of our revenue in U.S. dollars.

We have analyzed our foreign currency exposure as of June 30, 2025. A hypothetical adverse change of 10% in the June 30, 2025 exchange rates would not have had a material impact upon our results of operations.

Item 4. Controls and Procedures

(a) Disclosure Controls and Procedures

As required by Rule 13a-15(b), our management, including the Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), conducted an evaluation as of the end of the period covered by this report of the effectiveness of our disclosure controls and procedures as defined in Rule 13a-15(e). Based on that evaluation, the CEO and CFO concluded that our disclosure controls and procedures were effective as of the end of the period covered by this report.

(b) Internal Control Over Financial Reporting

As required by Rule 13a-15(d), our management, including the CEO and CFO, also conducted an evaluation of our internal control over financial reporting, as defined by Rule 13a-15(f), to determine whether any changes occurred during the quarter covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Based on that evaluation, the CEO and CFO concluded that there has been no such change during the quarter covered by this report.

CSG SYSTEMS INTERNATIONAL, INC.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

From time-to-time, we are involved in litigation relating to claims arising out of our operations in the normal course of business. In the opinion of our management, we are not presently a party to any material pending legal proceedings.

Item 1A. Risk Factors

A discussion of our risk factors can be found in Item 1A. Risk Factors in our 2024 10-K. There were no material changes to the risk factors disclosed in our 2024 10-K during the second quarter of 2025. Reference is made to “Macroeconomic Outlook” in Item 2. Management Discussion and Analysis of Financial Condition and Results of Operations for additional potential risks and uncertainties.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The following table presents information with respect to purchases of our common stock made during the second quarter of 2025 by CSG Systems International, Inc. or any “affiliated purchaser” of CSG Systems International, Inc., as defined in Rule 10b-18(a)(3) under the Securities Exchange Act of 1934, as amended (the "Exchange Act").



Period	Total Number of Shares Purchased (1) (2)		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Program (2)		Maximum Dollar Value of Shares that May Yet Be Purchased Under the Plans or Program (2)
April 1 - April 30		98,959	$	59.07		97,830	$	122,571,557
May 1 - May 31		98,474		64.14		90,834		116,760,007
June 1 - June 30		91,962		64.05		85,690		111,275,656
Total		289,395	$	62.38		274,354

(1)

This column includes 15,041 shares that were not part of a publicly announced plan or program and that were purchased and cancelled in connection with stock incentive plans.

(2)

In August 2023, our Board authorized the repurchase of $100.0 million of common stock under our Stock Repurchase Program. In August 2024, our Board authorized an additional $100.0 million of common stock repurchases under our Stock Repurchase Program, with all outstanding authorized repurchases to be completed by December 31, 2025. See Note 10 to our Financial Statements for additional information regarding our share repurchases under our Stock Repurchase Program.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

None.

Item 5. Other Information

During the second quarter of 2025, none of our directors or officers (as defined in Rule 16a-1(f) under the Exchange Act) adopted, modified, or terminated any contract, instruction, or written plan for the purchase or sale of our securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act or any “non-Rule 10b5-1 trading arrangement” as defined in Item 408(c) of Regulation S-K.

Item 6. Exhibits

The Exhibits filed or incorporated by reference herewith are as specified in the Exhibit Index.

CSG SYSTEMS INTERNATIONAL, INC.

EXHIBIT INDEX


Exhibit Number		Description
10.27AB*		Twenty-Fifth Amendment to the CSG Master Subscriber Management System Agreement between CSG Systems, Inc. and Comcast Cable Communications Management, LLC
31.01		Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.02		Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.01**		Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS		Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH		Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

* Portions of the exhibit have been omitted pursuant to SEC rules regarding confidential information.

** Furnished herewith.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Dated: August 7, 2025

     CSG SYSTEMS INTERNATIONAL, INC.

    

      
/s/ Brian A. Shepherd

     Brian A. Shepherd

    

     President and Chief Executive Officer 

    

     (Principal Executive Officer)

    

      
/s/ Hai Tran

     Hai Tran

    

     Executive Vice President and Chief Financial Officer 

    

     (Principal Financial Officer)

    

      
/s/ Lori J. Szwanek

     Lori J. Szwanek

    

     Chief Accounting Officer 

    

     (Principal Accounting Officer)

    

EX-10.27AB 2 csgs-ex10_27ab.htm EX-10.27AB EX-10.27AB

Exhibit 10.27AB

THIS DOCUMENT CONTAINS INFORMATION WHICH HAS BEEN EXCLUDED FROM THE EXHIBIT BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED. SUCH EXCLUDED INFORMATION IS IDENTIFIED BY BRACKETS AND MARKED WITH (***).

TWENTY-FIFTH AMENDMENT

TO THE

CSG MASTER SUBSCRIBER MANAGEMENT SYSTEM AGREEMENT

BETWEEN

CSG SYSTEMS, INC.

AND

COMCAST CABLE COMMUNICATIONS MANAGEMENT, LLC

THIS TWENTY-FIFTHAMENDMENT (this “Twenty-Fifth Amendment”) is made by and between CSG Systems, Inc. (“CSG”) and Comcast Cable Communications Management, LLC (“Customer”). The effective date of this Twenty-Fifth Amendment is the date last signed below (the “Twenty-Fifth Amendment Effective Date”). CSG and Customer entered into a certain CSG Master Subscriber Management System Agreement (CSG document #4131273) with an effective date of January 1, 2020 (the “Agreement”) and now desire to further amend the Agreement in accordance with the terms and conditions set forth in this Twenty-Fifth Amendment. If the terms and conditions set forth in this Twenty-Fifth Amendment conflict with the Agreement, the terms and conditions of this Twenty-Fifth Amendment shall control. Any terms in initial capital letters or all capital letters used as a defined term but not defined in this Twenty-Fifth Amendment shall have the meaning set forth in the Agreement. Upon execution of this Twenty-Fifth Amendment by the Parties, any subsequent reference to the Agreement between the Parties shall mean the Agreement as amended by this Twenty-Fifth Amendment. Except as amended by this Twenty-Fifth Amendment, the terms and conditions set forth in the Agreement shall continue in full force and effect according to their terms.

WHEREAS, CSG is transitioning the functionality of its Vantage Services to the [; and

WHEREAS, pursuant to terms of the Agreement, CSG provided [ to Customer of the “Vantage [ to DNA Data Warehouse” of CSG’s [ Vantage Services; and

WHEREAS, within such noted [, CSG will offer certain of its Vantage Services within the CSG Data & Analytics (“DNA”) suite of Services identified in this Twenty-Fifth Amendment; and

WHEREAS, pursuant to discussions between CSG and Customer, the Parties agree to amend the terms of the Agreement to provide ongoing Vantage Services and CSG DNA Services, as mutually agreed; and

WHEREAS, and, as a result, the Parties agree to amend the Agreement.

NOW THEREFORE, in consideration of the mutual covenants and agreements contained herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, CSG and Customer agree to the following as of the Twenty-Fifth Amendment Effective Date.

1. CSG will provide Customer with CSG Data & Analytics Services (the “DNA Data Services”), as described herein, in [ CSG Vantage Services as of the Twenty-Fifth Amendment Effective Date through [ (“the “DNA Data Services [”). As of the DNA Data Services [, CSG will [ the Vantage Services and functionality of the Vantage Services will [ for Customer; Customer will consume the functionality of the Vantage Services, as applicable, only as CSG DNA Data Services.

The Parties further agree, as of the DNA Data Services [, except as otherwise specifically referenced pursuant to this Twenty-Fifth Amendment, references to or that include “Vantage” in the Agreement prior to the DNA Data Services [ shall be deemed deleted and of no further force or effect.

2. Customer agrees to [ all Customer’s Vantage Services [ and [ its Vantage Services processes (including [ from Vantage Services) to DNA Data Warehouse, as defined in Attachment 1 of this Twenty-Fifth Amendment, [ than the DNA Data Services [.

3. Customer may use its Customer [ Account or CSG’s [ Account with the current [ in order to access DNA Data Services. Customer agrees and understands that any access to DNA Data Services via CSG’s [ Account will be subject to the fees defined in Schedule F of the Agreement.

4. CSG will [ Customer for Vantage Services through this Twenty-Fifth Amendment’s Effective Date and thereafter will [ Customer for the DNA Data Services.

5. For clarity, all Fees set forth in this Twenty-Fifth Amendment, specifically in clauses 14 and 15 below, reflect Customer’s [ as of January 2025. All the Fees set forth herein, remain subject to Section 5.4 of the Agreement “Adjustment to Fees.”

6. Section 4.11 entitled “CDC Cloud POC” of the Agreement shall be deleted in its entirety and replaced with the following:

“4.11 [Intentionally Omitted.]”

7. Section 6.2 entitled “De-conversion and Customer Data” of the Agreement, subsection (e), shall have the three (3) references to “(ACP/ACSR/Vantage)” changed to “(ACP/ACSR/DNA)”.

8. Schedule A entitled “Definitions” of the Agreement shall be amended to add the following:

“Compute” means a [ of CSG DNA Data Warehouse usage.

“Compute Credit(s)” means, for purposes of the DNA Data Services, a [ on CSG’s chosen [ utilizing the [ platform. [ for compute credits are documented at [. CSG and Customer will both have access to any changes documented by [ in terms of [ Compute Credit [.

“Compute Credit Threshold Allowance” means the [ of Compute Credits Customer is allowed to consume [ via the CSG [ Account without [ from CSG. If Customer consumes Compute Credits below the Compute Credit Threshold Allowance, no [ from CSG for Customer’s DNA Data Warehouse [ will occur. In the event Customer exceeds the [ Compute Credit Threshold Allowance, CSG [ Customer for Compute Credits exceeding the threshold allowance at a Compute Credit [ defined in the Schedule F, “Fees,” Section IV “Ancillary Products and Services” subsection B “DNA Data Services.”

“Compute Fee” is the fee charged per Compute Credit used via the CSG [ Account above customer’s Compute Credit Threshold Allowance.”

“CSG [ Account” In the CSG [ Account, CSG owns the relationship with [ and will contract with [ for the [ (“Compute Credits”) and [. CSG will also own the user security and user administration management layer and provide the Customer a self-service portal to self- administer user access and roles.

“Customer [ Account” In the Customer [ Account, Customer owns the relationship with [ and will contract directly with [ for [. Customer will own the security and all user administration functions. Customer will be able to consume new [ capabilities on Customer’s own schedule.

9. Upon the DNA Data Services Cutover Date, Schedule C entitled “Recurring Services” of the Agreement shall be amended as follows:

The Recurring Service Name list shall be amended by removing “CSG Reporting Services” and all subsections listed below it.

Exhibits C-19, C-19(a), C-19(b), C-19(c), C-19(d), C-19(e), C-19(f), C-19(g) shall be deleted in their entirety and marked as “RESERVED.”

c) Exhibit C-26, “CSG DNA DATA SERVICES RECURRING SERVICES DESCRIPTIONS,” attached hereto as Attachment 1, shall be added to Schedule C to the Agreement.

10.

Upon the DNA Data Services [, all references to CSG Vantage and CSG Vantage Plus in Attachment A to Exhibit C-1 under [ shall be deleted in their entirety and replaced with DNA Data Services.

11.

Upon the DNA Data Services [, Schedule F, “Fees,” Section “Index”, subsection V “Technical Services/ Implementation Services/Training,” subsection C “Additional training and documentation,” number 4, shall be deleted in its entirety and replaced with the following:

“4. DNA Data Warehouse training”

12.

Upon the DNA Data Services [, Schedule F, “Fees,” Section III “Direct Solutions (Print and Mail Services)” Note 6, shall be deleted in its entirety and replaced with the following:

“Note 6: Customer may elect to use optional DNA Direct service for enhanced customer letters to allow for the ability to [ their customers.”

13.

Upon the DNA Data Services [, Schedule F, “Fees,” Section III “Direct Solutions (Print and Mail Services)” Note 14, shall be deleted in its entirety and replaced with the following:

“Note 14: Additional RIM (Remit in Mail) fields in CCS® allow Customer to (i) select which [ actions to [, and (ii) identify the [. Provides Customer with additional RIM fields in SSB_TABLE in DNA Data Warehouse that correspond to the S12 screen and are updated [ a [ with [ cycle. Fields include:

(a) RIM_CNT_SBB: Shows the number of remits CSG has received for the account.

(b) RIM_CURR_DTE_SBB: Shows the date of the most recent remit that CSG has received.

14.

Upon the DNA Data Services [, Schedule F, “Fees,” Section IV “Ancillary Products and Services,” subsection B “Vantage® Modules” shall be deleted in its entirety and replaced with the following:

“B. DNA Data Services

I. DNA Data Warehouse


Description of Item/Unit of Measure	Frequency	Fee
1. Compute Fees (per [) (Note 1)
2. Storage for Customer Created Tables (per [)

Note 1: For CSG [ Accounts, CSG will invoice Customer a Compute Fee for its use of DNA Data Warehouse Services based upon the actual Compute Credits utilized by Customer in excess of its [ Compute Credit Threshold Allowance. CSG and Customer acknowledge and agree CSG shall establish Customer’s Compute Credit Threshold Allowance based upon Customer’s [. At the [ of the [, CSG and Customer will enter into a mutually agreed upon amendment to the Agreement to memorialize Customer’s Compute Credit Threshold Allowance. During the [, while establishing Customer’s Compute Credit Threshold Allowance, CSG will configure Customer’s DNA Data Warehouse capacity based upon Customer’s Vantage Direct and Vantage test environment [ levels during the 2024 [. “Compute Credit” and “Compute Credit Threshold Allowance” are as defined in Schedule A of the Agreement. For Customer [ Accounts, Customer’s [ will be determined in accordance with the third-party cloud data warehouse provider agreement with Customer.

II. DNA Data Warehouse BI Reporting Dashboard End User Licensing


Description of Item/Unit of Measure		Frequency	Fee
1. DNA Data Warehouse [ Single Named Business Intelligence [ (Note 1)
2. DNA Data Warehouse [ Support & Maintenance (Note 1) (Note 2)
BI Dashboard Complexity Tier	Number of Data Sources	Frequency	Fee Per [
Simple
Intermediate (Note 4)
Complex	or more
3. DNA Data Warehouse Storage (Note 3)
a) Per [ of data storage

Note 1: The [ end user license fees for the [ named users IDs for the DNA Data Warehouse BI dashboard as well as the Support and Maintenance fees areas defined in the Agreement.

Note 2: The dashboard complexity tiers are defined per [. The use of Customer or third party data sources will need to be mutually agreed upon on how they are loaded into a dashboard and considered [. Dashboards can move through the tiers as additional requests are developed.

Note 3: Storage fees apply in the event new data feeds are required, or Customer elects to expand existing DNA Data Warehouse retention settings.

Note 4: Enhanced Campaigns dashboard previously provided by CSG to Customer’s [ included [ DNA Data Warehouse [ users for the [ and [ DNA Data Warehouse [users for the [. There is a total of [ ()] report [ per [.

III. DNA Reports Warehouse


Description of Item/Unit of Measure	Frequency	Fee
1. Implementation Fee
2. DNA Reports Warehouse Relational Report Table support fee (Customer [ Account) (Note 1)
3. DNA Reports Warehouse Relational Report Table support fee (CSG [ Account) (Per [, Per [) (Note 2)

Note 1: Includes all reports available for all production schemas in DNA Reports Warehouse. Fee and access to all reports is contingent upon Customer accessing the production instance of DNA Data Warehouse via their Customer [ Account. In the event Customer notifies CSG (email is sufficient) they are no longer using the Customer [ Account, Customer shall be invoiced at the rate shown in #3 above.

Note 2: [ report [ per [. Fee applies if Customer only accesses the production instance of DNA Data Warehouse via the CSG [ Account in any given [.

IV. DNA Data Warehouse Roll Up Schema (Note 1)


Description of Item/Unit of Measure	Frequency	Fee
1. Implementation Fee (Note 2)
2.Support Fee (per [) (Notes 3-5)

Note 1: The DNA Data Warehouse Roll Up Schema is a virtual schema that allows DNA Data Warehouse users to query all regions within a [ at the [ level.

Note 2: A [ use of the DNA Data Warehouse Roll Up Schema is subject to a per-[ implementation fee. The implementation fees of the DNA Data Warehouse Roll Up Schema for the [ has been charged against SOW 4128581-Macro Services Bucket-[-2019.

Note 3: The DNA Data Warehouse Roll Up Schema is subject to a per [ support fee for the maintenance, support, and continued access to the DNA Data Warehouse Roll Up Schema. The support fee commences in the [ the DNA Data Warehouse Roll Up Schema is deployed at a [.

Note 4: The [ support fee is [ in the [ BSC Fee. All other divisions using the DNA Data Warehouse Roll Up Schema will be charged the per [ support fee.

Note 5: The [ Support Fee is due to CSG on a [ basis. The Parties acknowledge the receipt of Vantage Roll Up Schema solution was accepted as of [, and is being replaced by DNA Data Warehouse Roll Up Schema. CSG agreed to waive the application hosting fee pertaining to the period of [. As per the Fourth Amendment to this Agreement (CSG document no. 32903), CSG invoiced the Support Fees for [ through the [ pertaining to the date on which the Fourth Amendment was executed. CSG shall invoice subsequent [ Support Fees effective with the [ invoice for the [ immediately following the execution date of the Fourth Amendment through the remainder of the [ (including, if applicable, the [).”

15.

Upon the DNA Data Services [, Schedule F, “Fees,” Section V “Technical Services/Implementation Services/Training” subsection C “Additional Training & Documentation” subsection 4 “Vantage Training” shall be deleted and replaced with the following:

“4.DNA Data Warehouse training


	Standard Class Size	Rate (On-site) (Per [, per [)	Additional Students (Per [, per [)	Rate (at CSG facility) (Per [, per [)
Basic
Advanced
Database literacy

Note: All classes include the relevant training materials and documentation.”

16.

Upon the DNA Data Services [, Schedule F.1, “Listing of Products and Services [” shall be modified as follows:

a. Section I “Processing” subsection B “Ancillary Services specific to Residential Voice Services, with exceptions noted:” number 8 under Column “CSG Services” shall be deleted and replaced with the following:

8. Advanced Reporting – DNA Data Warehouse residential voice Support processing”

Section I “Processing” subsection H “Vantage” shall be deleted and replaced with the following:


CSG SERVICES	Threshold Level [ Component (Yes/No)	Pricing for Excess [ Threshold Level (as applicable)
H. DNA Data Services
a) DNA Data Warehouse setup and database modifications and other services. DNA Data Warehouse including systems and database management, daily database updates and loads, ongoing product support, processing, and access for unlimited users with usage up to Customer’s Compute Threshold Allowance, to the CSG [ DNA Data Warehouse Account. Optional tables in DNA Data Warehouse access thru the CSG [ DNA Data Warehouse account up to Customer’s Compute Threshold Allowance, limited to the following tables: ▪ Static tables – [-end copies of database tables that are not date driven. Original base tables continue to be updated [. Duplicate tables remain static until the next [-end. ▪ Monetary Transaction Detail tables - Lowest leaf level of monetary transaction detail available. Includes all monetary transactions affecting all subscriber accounts including video and data. Customer may store up to [ of data. ▪ Scheduling Calendar - Work order scheduling [ information from [ snapshots. Includes available and scheduled work units by management area and schedule date. ▪ DNA Direct ▪ Leads Tracking tables ▪ Residential Voice Support ▪ Non-HSD Subscriber Access E-mail Address ▪ Enhanced Security tables ▪ UDF Cards 1-143 (Storage will be capped at [ maximum. If Customer requires retention beyond [, the Storage Fee will apply.) ▪ Pending UDF Cards and 9xx Service Changes ▪ OJC ▪ Customer Value ▪ Earned/Unearned Revenue at the subscriber level tables ▪ DNA Data Warehouse Total Service Code Statistics ▪ AIU Optional ▪ DNA Delta Views including insert/change/delete and purge records retained for [ ▪ DNA Financial Forecaster
b) DNA Data Warehouse Near Real Time Notes:


CSG SERVICES	Threshold Level [ Component (Yes/No)	Pricing for Excess [ Threshold Level (as applicable)
▪ Customer shall have access to CSG’s DNA Data Warehouse Near-Real Time reporting tool. The Near-Real Time reporting application will provide updates from the order, job, item, equipment, scheduling calendar systems, outage detection, and subscriber data from ACP. CSG will also make available in near real time updates from Voice and CIT.
c) InfoCast Files ▪ InfoCast Files are scheduled applications that create data extracts which are compressed, (if necessary) encrypted, and sent to an FTP directory maintained by CSG on behalf of Customer (“InfoCast Pick Up Site”). CSG authors the logic to create the report files from DNA Data Warehouse data and enhances or modifies the logic in the event the DNA Data Warehouse data objects change. InfoCast Files applications can be scheduled to run intraday, daily, weekly, monthly, or at specific intervals. Customer accesses the InfoCast Pick Up Site to retrieve the extracted data. CSG maintains the extracted data on the InfoCast Pick Up Site until the earlier of pick up by Customer or [. CSG also maintains a backup copy of each extracted dataset for [. At Customer’s request, CSG will restore a backup copy of an extracted dataset to the InfoCast Pick Up Site.

17.

Upon the DNA Data Services [, Schedule H entitled “Support Services” to the Agreement shall be deleted in its entirety and replaced with the revised Schedule H, attached hereto as Attachment 2, attached herein and incorporated by reference.

“[III. Intentionally Omitted.]”

18.

Upon the DNA Data Services [, Schedule K entitled “Guidelines for Passer and Agent Transfer Program Requests” to the Agreement shall be deleted in its entirety and replaced with the revised Schedule K, attached hereto as Attachment 3, attached herein and incorporated herein.

19.

Upon the DNA Data Services [, Schedule K.1 entitled “Standard/Non Standard Passer Definitions” to the Agreement shall be deleted in its entirety and replaced with the revised Schedule K.1, attached hereto as Attachment 4, attached hereto and incorporated herein by reference.

IN WITNESS WHEREOF the Parties hereto have caused this Twenty-Fifth Amendment to be executed by their duly authorized representatives.

     COMCAST CABLE COMMUNICATIONS MANAGEMENT, LLC (“CUSTOMER”)
 
     CSG SYSTEMS, INC. (“CSG”)

      
By:  /s/ Deepak Bharathan

By:  /s/ Michael J Woods

      
Name: Deepak Bharathan

Name: Michael Woods

      
Title:  Vice President, Procurement

Title:  EVP

      
Date:  16-Jun-25

Date: 06/01/2025

Attachment 1

Twenty-Fifth Amendment

Exhibit C-26

CSG DNA DATA SERVICES RECURRING SERVICES DESCRIPTIONS

DNA Data Warehouse. DNA Data Warehouse is a cloud data warehouse offering secure access to customer care, financial and operational data processed by ACP for data analysis and decision support purposes leveraging a third- party cloud data warehouse provider, [.  CSG will provide both end of [ updates for all tables in the DNA Data Warehouse environment, as well as [ updates through [ updates a [ for a select set of tables including order, job, item, account, scheduling calendar, outage detection and equipment, and payments.

Customer may access ACP data in DNA Data Warehouse through CSG’s [ account (“CSG [ Account”), or through Customer’s [ account (“Customer [ Account”) if Customer has a direct relationship with [.

If Customer chooses to access DNA Data Warehouse data through a CSG [ Account, CSG will provide a [ Compute allowance for Customer’s usage in the DNA Data Warehouse.   If Customer chooses to access DNA Data Warehouse data through a Customer [ Account, then Customer’s usage fees will be as determined pursuant to an agreement by and between [ and Customer. In either access method (i.e., CSG [ Account or Customer [ Account), CSG will fund the load costs and storage costs of Customer’s ACP data. Customer will be responsible for storage fees for custom tables created by Customer.

DNA Delta Views: DNA Delta Views will include a set of change records for all views previously updated through files delivered through CSG’s Data Publisher File Edition. DNA Delta Views will reside in the DNA Data Warehouse and will include all changes for a given [ to include inserted, updated, deleted, and purged records, providing Customer with [()] updates. The data in the DNA Delta Views will be retained for [. Customer will be responsible for modifying Customer’s process to consume the changes from the DNA Data Warehouse.

DNA Direct.  DNA Direct is a CSG Service that provides Customer with the ability to use the DNA Data Warehouse to target Customer's Connected Subscribers for specific messages (via Message Manager), Ad Pages, Customer letters and/or mass adjustments, based on data captured and stored in DNA Data Warehouse.

DNA Reports Warehouse. DNA Reports Warehouse is a production report delivery and archival service for ACP generated production reports.   DNA Reports Warehouse provides a user interface from which Customer can view and download reports (the “Report Images”) in a variety of formats. All Report Images will be retained for [, and are accessible in HTML, PDF and ASCII Text formats. A subset of reports is also stored in relational tables for [ and will also be accessible in CSV and Excel formats and can also be directly queried by Customer in the DNA Data Warehouse.  

DNA Data Change Engine. DNA Data Change Engine is a self-service application designed for Customer to apply mass changes to Customer’s customer care data through a user interface that has pre-integrated templates. The user interface will use SLBOS on the back end to apply the requested data changes to the list of records the user attaches to the interface.

DNA Financial Forecaster. DNA Financial Forecaster provides [ financial snapshot reports that assist with Customer’s [ end financial projections.

DNA InfoCast Files. DNA InfoCast Files are scheduled applications that create data extracts which are compressed, (if necessary) encrypted, and sent to an FTP directory maintained by CSG on behalf of Customer (“InfoCast Pick Up Site”). CSG authors the logic to create the report files from DNA Data Warehouse data and enhances or modifies the logic in the event the DNA Data Warehouse data objects change.

DNA InfoCast Files applications can be scheduled to run intraday, daily, weekly, monthly, or at specific intervals. Customer accesses the InfoCast Pick Up Site to retrieve the extracted data. CSG maintains the extracted data on the InfoCast Pick Up Site until the earlier of pick up by Customer or [. CSG also maintains a backup copy of each extracted dataset for [. At Customer’s request, CSG will restore a backup copy of an extracted dataset to the InfoCast Pick Up Site. See Schedule F for applicable service fee per restoration.

Attachment 2

Twenty-Fifth Amendment

SCHEDULE H

SUPPORT SERVICES

I. Customer Business Unit

CSG will assign a [ for the support of Customer (i.e., the Comcast CBU). The CBU will have the overall responsibility for Customer satisfaction with all Products and Services. CSG will assign and maintain personnel in the CBU that have the appropriate skills and adequate resources to support Customer throughout the Term and any De-conversion Period. The make-up of the CBU may change from time to time to meet the changing needs of Customer. The CBU shall distribute copies of CSG’s current escalation process to all Customers and agrees to provide timely updates to reflect any material changes to the escalation process. The CBU will participate in periodic conference calls and meetings with Customer to gain direct feedback on user satisfaction, industry trends and Customers’ short- and long-term plans.

CSG and Customer agree to hold [ executive review meetings with attendance by those senior executives agreed by the Parties. In addition, CSG and Customer agree to meet on a [ basis with CSG and Customer’s respective Chief Executive Officers in attendance. The meetings may include, but not be limited to, such things as progress related to CSG’s operational performance, and CSG’s product road map and general business direction.

II. Support Services (excluding DNA Data Warehouse):

International Support Desk

The International Support Desk (“ISD”) will provide Customer with advice, consultation and assistance to use Products and receive Operational and Systems Management Services and diagnose and correct problems, including any failure of a Product to perform substantially as described in the Documentation for such Product (“Problems”), that Customer may encounter with the Products and Services. CSG will offer the ISD remotely by toll-free telephone, fax or other electronic communication [. Customer will bear all tax and other expenses that it may incur in connection with the ISD. The terms and conditions set forth in this Schedule H shall also apply to any Deliverables with respect to which a Customer has purchased support and maintenance services from CSG.

When contacting the ISD, the Comcast caller should be prepared to provide detailed information regarding the Problem and the impact on the operation and the end user. In certain situations, Customer will need to provide CSG with adequate examples and details to assist with Problem identification. A Customer shall describe the urgency of the Problem when it is initially reported. Every Customer Problem is assigned a tracking number and CSG will assign a priority/severity level to all Problems reported by Customer in accordance with mutually agreed upon prioritization criteria. Problems are resolved according to their assigned priority/severity. CSG may, upon notice to Customer, change a designated priority/severity level of any Problem if, after investigation, the impact of the Problem on Customer’s business operations is determined to be more or less severe than the initial designation.

The priority/severity levels are described below:

•

CRITICAL (PRIORITY/SEVERITY 1): (i) [. Customer will receive CSG’s immediate response, prioritized problem resolution and restorative services at the highest possible level. Once control has been regained, efforts are then made to determine the “root cause” of the Problem.

Considering the nature of the cause, the Problem is adjusted to one of the other priorities and processed accordingly. While a Critical (Priority/Severity 1) Problem exists, the ISD shall provide [.

•

SERIOUS (PRIORITY/SEVERITY 2): [ The ISD’s goal is to ensure that control of the system is not jeopardized and to work with such Customer to gather information in order to resolve the issue. While a Serious (Priority/Severity 2) Problem exists, [.

•

OPERATIONAL (PRIORITY/SEVERITY 3): [ A user may be a CSR or the Customer’s operation staff running the system. CSG’s ISD goal is to [. This Priority/Severity level includes those issues not designated as Serious or Critical as described above.

Problem start time will begin upon Customer’s notification to CSG of a Problem or non-conformance. Problem resolution will occur at such time the Problem or non-conformance has been fixed. After such correction of the reported Problem or non-conformance, if Customer discovers that the Problem still exists, Customer will promptly notify CSG and CSG will re-open the original ticket and re-initiate efforts to provide resolution. Should the Customer wish to check the status of a Problem, such Customer may contact the ISD desk representatives or Customer’s CBU. In either case, the Customer should reference the tracking number.

During the Term of the Agreement, for each Priority/Severity 1 issue that CSG does not resolve within [ of problem start time, CSG will provide Customer with on-site user training credits sufficient for [ training days, as specified in Schedule F, on the use of the Software or Products at no charge, to be used at Customer’s sole discretion.

Reports. At the conclusion of each [, CSG will provide a report to Customer identifying all Priority/Severity 1 and Priority/Severity 2 tickets that were initiated during that month. Such report will be delivered to Customer no later than the [ following the conclusion of the [ for which the report is being produced, and such report will contain the ticket number, open date and time, a brief description of the situation causing the initiation of the ticket and close date and time (or current status if such ticket has not yet been closed).

III. CSG DNA Data Warehouse Services (which for purposes of this subsection shall include VNRT)

Standard Support Services for DNA Data Warehouse

Customer support of DNA Data Warehouse is provided as part of the Support Services during CSG's customer service hours for support of questions, functionality, workflow, training, and non-catastrophic software defects. System support of CSG Data Warehouse is provided as part of the Support Services for Problems resulting from defects in CSG DNA Data Warehouse.

The following services for the then-current and prior version will be provided by CSG as part of the CSG DNA Data Warehouse Support Services:

1. Telephone consultation for trained users for questions and problems regarding CSG DNA Data Warehouse.

2. Up to [ of telephone consultation for troubleshooting a previously certified hardware/software environment.

3. Attendance at regularly scheduled basic and advanced CSG DNA Data Warehouse training classes offered in Omaha or at a scheduled regional training location, as space permits.

4. Daily updates to the DNA Data Warehouse.

5. Storage of [of financial data; Work Order Table storage for two years; Subscriber Table storage dependent upon UDF settings.

Optional Services for DNA Data Warehouse:

Upon a Customer’s request, and subject to payment of the applicable fee set forth in Schedule F, the following additional services are also available to DNA Data Warehouse Customer:

1. Static Database – [ loaded tables; one time set-up, monthly load, monthly disk storage.

2. Monetary Transactions - All system and manually generated monetary transactions; one time set-up, monthly load, [ disk storage.

3. Scheduling Calendar - A summary of the scheduling calendar updated [ times per [; one time set-up, [ load, [ disk storage.

4. Query Building - Consulting services for developing new queries.

5. Additional Training - Training beyond training provided in Schedule F.

6. Systems Integration and Support

- Certifying non-certified hardware/software environment

- Troubleshooting existing hardware/software environment (first hour is free for certified environments)

- On-site support as requested by customer

7. Output Charges

8. Earned Revenue Table

9. SAC (Non High Speed Data table)

10. EML

11. Customer Letters

12. ESP Ad Pages

13. Customer Value Optional Table in DNA Data Warehouse

14. CSG’s UDF Cards 1-143 DNA Data Warehouse Optional Table

15. Total Service Code Statistics Optional Table in DNA Data Warehouse

IV. CSG SmartLink (Includes CSG SmartLink and CSG SmartLink/BOS)

The following services for CSG SmartLink will be provided by CSG as part of the CSG Support Services:

Maintenance Support

CSG will only support [ consecutive versions of CSG SmartLink at any given time, as such versions are defined by CSG in its sole discretion. Customer shall be required to upgrade its production version of CSG SmartLink, so as to maintain currency within its application and ensure CSG’s ability to support Customer’s version of the interface.

Operations Support

CSG will be responsible for [monitoring of the server hardware, operating system and applications. CSG will proactively detect issues with any failing component and contact the appropriate support personnel to return the failing component to operation.

Customer’s Obligations

To facilitate that CSG has the proper operating environment in place to support Customer’s CSG SmartLink, Customer shall provide to CSG, upon CSG’s request, non-binding volume estimates prior to the implementation of an API into production. In addition, Customer shall provide, upon CSG’s request, non-binding volume estimates prior to the first day of each calendar quarter.

V. Interfaces. The following services for the APIs will be provided by CSG as part of the CSG Support Services provided Customer pays the maintenance and support fees for Interfaces set forth in Schedule F or the applicable Statement of Work:

Except as provided in this Subparagraph 1, CSG shall provide support for versions of an Interface for a minimum of [, or the current and most recent [ versions as measured by the numeral immediately to the right of the decimal (e.g., x.y where “y” is the point of measure), whichever amount of time is greater. If Customer desires to continue maintenance coverage for such Interface beyond the foregoing, Customer shall be required to periodically upgrade its production version of the Interface in order to maintain currency within its application and ensure CSG’s ability to support Customer’s version of the Interfaces.

The following four interfaces: Service Layer, IVR, Remedy and CBI, will be counted towards the [ provided in Schedule F. New Interfaces will be included or added to the [ via a Statement of Work or amendment, as applicable, executed by the Parties.

Customer shall be allowed to upgrade to the most current version of an Interface supported by CSG without any additional charges from CSG. Requests to upgrade to a newer version of Interface shall be scheduled per availability of resources and standard implementation lead times;

Customer shall not be required to pay for Certification to a newer version of the API supported by CSG.

CSG reserves the right, at its discretion, to discontinue maintenance of or decommission Interfaces upon [ advance written notice to Customer. CSG shall provide Customer a list of alternative interfaces that may be used in place of the decommissioned Interface (or the Interface for which maintenance has ceased). Customer reserves the right to implement such alternative interface without any additional charges from CSG prior to expiration of support or decommissioning of the Interface. Upon Customer’s request, CSG shall support decommissioned or earlier versions of an Interface subject to a mutually agreeable SOW.

VI. CUSTOMER/CBU REVIEW OF SUPPORT SERVICES.THE COMCAST CBU WILL MEET WITH CUSTOMER ON A[BASIS TO REVIEW CSG’S SUPPORT SERVICES AND TO GAIN CUSTOMER’S INSIGHT AND SUGGESTIONS. THIS REVIEW WILL INCLUDE SENIOR LEVEL REPRESENTATIVES FROM THE CBU, ISD AS WELL AS ANY OTHER INDIVIDUALS NECESSARY TO PROVIDE ANY ADDITIONAL INFORMATION. SENIOR LEVEL REPRESENTATIVES FROM CUSTOMER, SUCH AS THE CONTRACT ADMINISTRATOR OR TECHNICAL COORDINATOR, SHALL BE AVAILABLE AT THIS MEETING.

VII. Non-production Customer Test Environment Support

The following support will be provided for the non-production Customer Test Environments:

•

Customer test systems are active [ excluding published maintenance windows and communicated exceptions*

•

Issues can be reported to the ISD anytime but will only be worked between the hours of [, unless otherwise outlined in a different agreement

•

CSG will communicate information to Customer related to changes occurring in the non-production Customer Test Environment

•

Non-production Customer test environments run the current production software codebase except during the period known as ‘pre-release’, which occurs approximately [ prior to production releases. During the ‘pre-release’ time period, non-production customer test environments will be updated with the development testing codebase.

*There will be no on-call, after hours or holiday support unless otherwise agreed to by the Parties. In the event internal CSG resources are working on Customer’s production environment items, production matters will take priority over non-production test systems.

Attachment 3

Twenty-Fifth Amendment

SCHEDULE K

GUIDELINES FOR PASSER AND AGENT TRANSFER PROGRAM REQUESTS

Passer Definition

Passer – A Passer is a programmatic process that can be used to make bulk changes to key data residing on CSG’s billing system such as house, Equipment and Subscriber data without creating a work order. There are multiple types of Passers that are defined below:

Item Passer – [

NAS to DAC Passer – [

Equipment Passer – [

•

Non Key Change

A Non Key Change Equipment Passer only involves changes to the Equipment master file from DAC to DAC Passers.

•

Key Change

A Key Change Equipment Passer can involve modification of the serial number, type, outlet assignment, rent-purchase-flag and requires an update to the Equipment, Location, and equipment history master files.

House Passer – [

PDB (Provisionable Data Base) Item Passer – [ PDB Only Passer – [

NPA_NXX Passer – [

Subscriber Passer – [

Configurable Line of Business (CLOB) Passer – [

Job Passer – [

Standard Passers:


Passer Type		Charge (Note 1) (Note 2) (Note 3)
Item Passer
House Passer
Equipment Passer
NAS to DAC Passer (Add, Delete and Key Passers)

Note 1: These services and associated fees shall be set forth in a mutually agreed upon Statement of Work. In the event of termination of an executed Statement of Work by Customer, Customer shall pay all fees for work performed up to the termination date of the SOW. If Customer requests an expedited service to be performed Customer understands there may be an additional cost in the SOW that would exceed the standard hourly rate provided herein.

Note 2: If Customer increases demand for Passers such that CSG must increase its capacity to accommodate such increased demand, Customer and CSG agree to negotiate in good faith the pricing of such Passers.

Note 3: The fees noted are subject to Section 5.4 of the Agreement (Adjustment to Fees).

Non-Standard Passers

The following Passers are considered non-standard. The lead time and minimum price will be based upon the level of effort needed to meet the Customer defined specifications.



PDB Item Passer



NPA/NXX Passer



PDB Only Passer



CLOB Passer



Job Passer



Item Passer



Any Passer using data from an external source



Passers to any master files not listed would be considered custom and charged on a time and materials basis



Passers which have not previously been performed Note 3: These services and associated fees shall be set forth in a mutually agreed upon Statement of Work.

Agent Transfer Definition

SPA Management and Reassignment Tool (SMaRT) Transfer

File Strip

Agent Transfers:


Transfer Type	Lead Time	Charge (Note 3) (Note 5)
SMaRT Agent Transfer (Note 4)
Agent Transfer
File Strip

CSG will charge the standard Professional Services fees as set forth in Schedule F. In the event of termination of an executed Statement of Work by Customer, Customer shall pay all fees for work performed up to the termination date of the SOW. If Customer requests an expedited service to be performed Customer understands there may be an additional cost in the SOW that would exceed the standard hourly rate provided herein.

Note 4: See Exhibit K.2 - SPA Management and Reassignment Tool (SMaRT) for the requirements for an Agent Transfer to qualify for SMaRT pricing.

Note 5: The fees noted are subject to Section 5.4 of the Agreement (Adjustment to Fees).

CSG Responsibilities

CSG will perform the following activities in support of Customer Passer/Transfer activity:



An analyst will be assigned to each project to work with the Customer and coordinate internal CSG activity.



Provide the Customer with a current “Passer/Transfer Packet”. This packet will include basic information regarding the Passer/Tracker, a request form, a spec matrix and a project plan.



Weekly meetings will be held with the CSG Analyst and the site contact.



A project tracker that includes deliverable dates and an issues tracking log will be published weekly.



Output will be provided to the Customer after each test run and for live production.



CSG will identify and manage any impacts to ancillary products (like Precision eCare, FSM).



CSG will arrange for statement checkers, if needed.



CSG will arrange for Cycle Freeze/Force and/or Statement Holds, if needed.



On the day of implementation, CSG will provide updates throughout the day on any identified issues until an ‘all clear’ is agreed upon with the site.

Customer Responsibilities

The Customer will perform the following activities in support of Customer Passer/Transfer activity:



Identify a primary and secondary/escalation contact at the site. The primary contact will be considered the project lead on the Customer side.



Attend weekly meetings with CSG and review the project tracker for upcoming deliverables.



Identify and manage all configuration changes such as 9xx, Code Tables, Order Job Creation (“OJC”), Customer Discounts, service code prerequisite, etc.



Provide detailed specifications for the Passer/Transfer.



Review output and provide approval Inform CSG of all ancillary products the site is using.



Participate in calls on implementation day.



Provide approval for Cycle Force and/or Statement Release.

Milestone Dates

The following activities are considered ‘milestones’ in the project life cycle. If these activities are not completed as scheduled, the Passer/Tracker may be delayed.



Final Specifications submitted – Customer responsibility



UDF changes and pre-edit run – Customer responsibility



Test Output delivered to Customer – CSG responsibility



Approval of test output – Customer responsibility



Approval of project implementation – Customer responsibility

Changes to the final specifications may increase the implementation timeline. The addition of new specification after coding has started will result in an increased implementation timeline.

Attachment 4

Twenty-Fifth Amendment

Exhibit K.1 Standard/Non Standard Passer Definitions

This exhibit further clarifies what is a Standard Passer versus Non-Standard Passer.

House Passers:

A Standard House Passer is defined by the following parameters:

A Non-Standard House Passer is defined by the following parameters:

Equipment Passers:

A Standard Equipment Passer is defined by the following parameters:

A Non-Standard Equipment Passer is defined by the following parameters:

NAS to DAC Passers:

A Standard NAS to DAC Passer is defined by the following parameters:

A Non-Standard NAS DAC Passer is defined by the following parameters:

ITEM Passers:

A Standard Item Passer is defined by the following parameters:

A Non-Standard Item Passer is defined by the following parameters:

Other Non-Standard Passers include but are not limited to the following:

EX-31.1 3 csgs-ex31_1.htm EX-31.1 EX-31.1

EXHIBIT 31.01

CERTIFICATION PURSUANT TO

SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Brian A. Shepherd, certify that:

I have reviewed this report on Form 10-Q of CSG Systems International, Inc.;

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: August 7, 2025		/s/ Brian A. Shepherd
		Brian A. Shepherd
		President and Chief Executive Officer

EX-31.2 4 csgs-ex31_2.htm EX-31.2 EX-31.2

EXHIBIT 31.02

CERTIFICATION PURSUANT TO

SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Hai Tran, certify that:

I have reviewed this report on Form 10-Q of CSG Systems International, Inc.;

(a)

(b)

(c)

(d)

(a)

(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: August 7, 2025		/s/ Hai Tran
		Hai Tran
		Executive Vice President and Chief Financial Officer

EX-32.1 5 csgs-ex32_1.htm EX-32.1 EX-32.1

EXHIBIT 32.01

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

The certification set forth below is being submitted in connection with the Quarterly Report on Form 10-Q (the “Report”) for the purpose of complying with Rule 13a-14(b) or Rule 15d-14(b) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Section 1350 of Chapter 63 of Title 18 of the United States Code.

Brian A. Shepherd, the Chief Executive Officer and Hai Tran, the Chief Financial Officer of CSG Systems International Inc., each certifies that, to the best of his knowledge:

(1)

the Report fully complies with the requirements of Section 13(a) or 15(d) of the Exchange Act; and

(2)

the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of CSG Systems International, Inc.

August 7, 2025

     /s/ Brian A. Shepherd

    

Brian A. Shepherd

President and Chief Executive Officer

August 7, 2025

     /s/ Hai Tran

    

Hai Tran

Executive Vice President and Chief Financial Officer