Company: CXDO
Filing Date: 2025-11-04
Form Type: 10-Q
Source: 0001654954-25-012585
Chunk: 56

Company: Crexendo, Inc.
Filing Date: 2025-11-04
Form: 10-Q
Item: Part I, Item 1
Chunk 56
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Income/(loss) before income tax $3,988  $1,270  $2,718   214%

The increase in income/(loss) before income tax is primarily related to an increase in revenue of $5,508 and an increase in other income/(expense) of $358, offset by an increase in operating expenses of $3,148. The increase in revenue is related to organic growth from new and existing customers. The increase in operating expenses is primarily related to an increase salaries, benefits, bonuses, share-based compensation, and headcount of $1,077, an increase in commission expense of $893, an increase in contract labor and outsourced engineering services of $652, an increase in third-party telecommunication charges of $417, and an increase in other expenses of $109. The increase in other income/(expense) is primarily related to an increase in interest income of $282, an increase in other income of $63, and a decrease in interest expense of $13.

Income Tax Benefit/(Provision)

The following table reflects our income tax benefit/(provision) for the nine months ended September 30, 2025, compared to the nine months ended September 30, 2024:

  Nine Months Ended September 30,   2025  2024  Dollar Change  Percent Change Income tax benefit/(provision) $(135) $(100) $(35)  -35%

The increase in income tax provision is due to minimum state tax increases as a result of increased revenue.

Use of Non-GAAP Financial Measures

               To evaluate our business, we consider and use non-generally accepted accounting principles (“Non-GAAP”) net income and Adjusted EBITDA as a supplemental measure of operating performance. These measures include the same adjustments that management takes into account when it reviews and assesses operating performance on a period-to-period basis. We consider Non-GAAP net income to be an important indicator of overall business performance because it allows us to evaluate results without the effects of share-based compensation and related taxes, acquisition related expenses, changes in fair value of contingent consideration, amortization of intangibles, and goodwill and long-lived asset impairment. We define EBITDA as U.S. GAAP net income/(loss) before interest expense, interest income and other expense/(income), the gain/(loss) on the sale of property and equipment, goodwill and long-lived asset impairments, benefit/(provision