Asure Software (NASDAQ: ASUR) reported third-quarter 2024 financial results on October 31, 2024, and the results once again show the health and strength of the company’s core business. The HCM services provider continues working through the ERTC halt, which occurred in September 2023. This shows that starting with Q4 2024 results, investors will finally start to see a better apples-to-apples comparison for quarterly results and their respective year-over-year performance.
ASUR: Breaking Down Q3 2024 Results
The HCM services company reported revenue (excluding ERTC) of $29.2 million, which represented 20% year-over-year growth. Equally impressive was the fact that recurring revenue from its core businesses grew to 98% of total revenue, compared to 81% for the same period last year.
This continues to support the idea that Asure’s core business growth is taking the place of the old ERTC revenues, which were only a one-time sale. Recurring revenue from its core business represents a much more valuable sales source, as it is recurring (as the name suggests) and highlights demand for its HCM services.
In the earnings call, Asure CEO, Pat Goepel, stated that despite timing issues with larger deals, the company’s sales booking was up 141% and the backlog surged 250%. As a result, management says they believe those factors will help drive strong results in 2025.
New HCM Services: Payroll Tax Management Expansion, New AI Agent, and Introduction of AsurePay Highlight Q3 Milestones
Asure had several meaningful business highlights during the third quarter. Management said its payroll tax management services saw an impressive expansion after onboarding some additional Workday (NASDAQ: WDAY) and SAP (NYSE: SAP) clients. In addition, the company says its payroll tax management business gained significant customers in a major American grocery chain and a large HCM system integrator.
The company announced it entered its new AI Agent into beta testing. The new Generative AI Agent is being developed to help Asure’s clients be able to offer support and inquiries related to payroll, payroll taxes, HR requests, and more. This represents an exciting opportunity for Asure to leverage AI technology and provide further efficiencies to its client base.
Launching in November 2024, Asure’s new AsurePay financial service will provide American customers with a comprehensive online banking alternative. AsurePay will Feature debit card access, fee-free ATM services, paycheck advances, and more. The unique banking solution allows SMB clients to have another tool to help strengthen employee engagement and improve overall efficiencies.
Overall, Asure is doing a great job at continuing to fully replace those former one-time revenues with high-value recurring sales from its core HCM business. The company’s expansion of bookings and backlog continue to underscore a bright future for the company.
Furthermore, the company’s continued commitment to innovation and new product offerings is no doubt a positive to its vast SMB client base. The introduction of its financial service, AsurePay, and the beta testing of an interactive AI Agent only further prove this point. The next financial results should help investors provide a clearer picture of how the core business is driving results without any distraction. This is a great sign for the company, as management has worked hard at making that higher-value transformation over the past twelve months.
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The post Asure (NASDAQ: ASUR) Highlights Strength of Core HCM Business as Recurring Revenue Jumps 20% in Q3 2024 and Accounts for 98% of Total Revenues appeared first on Spotlight Growth.
