CPI Card (PMTS) 10-Q3 Nov 222022 Q3 Quarterly reportFinancial data

Company Profile

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2022	Oct. 27, 2022
Cover Abstract
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2022
Document Transition Report	false
Entity File Number	001-37584
Entity Registrant Name	CPI Card Group Inc.
Entity Central Index Key	0001641614
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	26-0344657
Entity Address, Address Line One	10368 W. Centennial Road
Entity Address, City or Town	Littleton
Entity Address, State or Province	CO
Entity Address, Postal Zip Code	80127
City Area Code	720
Local Phone Number	681-6304
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Title of 12(b) Security	Common Stock, $0.001 par value
Trading Symbol	PMTS
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		11,385,619
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q3

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Current assets:
Cash and cash equivalents	$ 21,507	$ 20,683
Accounts receivable, net of allowances of $169 and $86, respectively	75,749	60,953
Inventories	72,219	58,009
Prepaid expenses and other current assets	5,080	5,522
Income taxes receivable	2,112	534
Total current assets	176,667	145,701
Plant, equipment, leasehold improvements and operating lease right-of-use assets, net	57,268	47,251
Intangible assets, net	18,954	21,854
Goodwill	47,150	47,150
Other assets	5,008	6,184
Total assets	305,047	268,140
Current liabilities:
Accounts payable	25,703	26,443
Accrued expenses	34,384	37,150
Deferred revenue and customer deposits	3,915	1,182
Total current liabilities	64,002	64,775
Long-term debt	310,091	303,626
Deferred income taxes	6,445	5,253
Other long-term liabilities	18,769	15,506
Total liabilities	399,307	389,160
Commitments and contingencies (Note 14)
Series A Preferred Stock; $0.001 par value-100,000 shares authorized; 0 shares issued and outstanding at September 30, 2022 and December 31, 2021
Stockholders' deficit:
Common stock; $0.001 par value-100,000,000 shares authorized; 11,287,909 and 11,255,466 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively	11	11
Capital deficiency	(108,085)	(110,782)
Accumulated earnings (loss)	13,814	(10,249)
Total stockholders' deficit	(94,260)	(121,020)
Total liabilities and stockholders' deficit	$ 305,047	$ 268,140

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Condensed Consolidated Balance Sheets
Allowance on accounts receivable	$ 169	$ 86
Preferred shares, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred shares, authorized shares (in shares)	100,000	100,000
Preferred shares, issued shares (in shares)	0	0
Preferred shares, outstanding shares (in shares)	0	0
Common shares, par value (in dollars per share)	$ 0.001	$ 0.001
Common shares, authorized shares (in shares)	100,000,000	100,000,000
Common shares, issued shares (in shares)	11,287,909	11,255,466
Common shares, outstanding shares (in shares)	11,287,909	11,255,466

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations and Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Net sales:
Net Sales	$ 124,577	$ 99,602	$ 349,309	$ 281,913
Cost of sales:
Depreciation and amortization	2,245	2,056	6,564	6,736
Total cost of sales	76,137	61,917	221,040	171,419
Gross profit	48,440	37,685	128,269	110,494
Operating expenses:
Selling, general and administrative (exclusive of depreciation and amortization shown below)	23,403	19,469	67,335	55,363
Depreciation and amortization	1,592	1,514	4,454	4,873
Total operating expenses	24,995	20,983	71,789	60,236
Income from operations	23,445	16,702	56,480	50,258
Other expense, net:
Interest, net	(7,323)	(7,183)	(22,334)	(23,196)
Other (expense) income, net	(63)	(6)	(79)	23
Loss on debt extinguishment			(395)	(5,048)
Total other expense, net	(7,386)	(7,189)	(22,808)	(28,221)
Income before income taxes	16,059	9,513	33,672	22,037
Income tax expense	(4,149)	(2,887)	(9,609)	(6,769)
Net income	$ 11,910	$ 6,626	$ 24,063	$ 15,268
Basic earnings per share: (in dollar per share)	$ 1.06	$ 0.59	$ 2.14	$ 1.36
Diluted earnings per share: (in dollar per share)	$ 1.01	$ 0.56	$ 2.05	$ 1.30
Basic weighted-average shares outstanding (in shares)	11,265,767	11,238,678	11,259,655	11,234,054
Diluted weighted-average shares outstanding (in shares)	11,788,921	11,799,321	11,730,668	11,755,381
Comprehensive income:
Net income	$ 11,910	$ 6,626	$ 24,063	$ 15,268
Total comprehensive income	11,910	6,626	24,063	15,268
Products
Net sales:
Net Sales	71,606	52,276	208,867	146,445
Cost of sales:
Products and Services (exclusive of depreciation and amortization shown below)	42,702	31,493	128,851	86,708
Services
Net sales:
Net Sales	52,971	47,326	140,442	135,468
Cost of sales:
Products and Services (exclusive of depreciation and amortization shown below)	$ 31,190	$ 28,368	$ 85,625	$ 77,975

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Stockholders' Deficit - USD ($) $ in Thousands	Common Stock	Capital deficiency	Accumulated loss	Total
Beginning balance at Dec. 31, 2020	$ 11	$ (111,858)	$ (26,190)	$ (138,037)
Beginning balance (in shares) at Dec. 31, 2020	11,230,482
Shares issued under stock-based compensation plans		22		22
Shares issued under stock-based compensation plans (in shares)	8,512
Stock-based compensation		214		214
Components of comprehensive income:
Net income			15,268	15,268
Ending balance at Sep. 30, 2021	$ 11	(111,622)	(10,922)	(122,533)
Ending balance (in shares) at Sep. 30, 2021	11,238,994
Beginning balance at Jun. 30, 2021	$ 11	(111,726)	(17,548)	(129,263)
Beginning balance (in shares) at Jun. 30, 2021	11,237,056
Shares issued under stock-based compensation plans		(12)		(12)
Shares issued under stock-based compensation plans (in shares)	1,938
Stock-based compensation		116		116
Components of comprehensive income:
Net income			6,626	6,626
Ending balance at Sep. 30, 2021	$ 11	(111,622)	(10,922)	(122,533)
Ending balance (in shares) at Sep. 30, 2021	11,238,994
Beginning balance at Dec. 31, 2021	$ 11	(110,782)	(10,249)	$ (121,020)
Beginning balance (in shares) at Dec. 31, 2021	11,255,466			11,255,466
Shares issued under stock-based compensation plans		(231)		$ (231)
Shares issued under stock-based compensation plans (in shares)	32,443
Stock-based compensation		2,928		2,928
Components of comprehensive income:
Net income			24,063	24,063
Ending balance at Sep. 30, 2022	$ 11	(108,085)	13,814	$ (94,260)
Ending balance (in shares) at Sep. 30, 2022	11,287,909			11,287,909
Beginning balance at Jun. 30, 2022	$ 11	(108,880)	1,904	$ (106,965)
Beginning balance (in shares) at Jun. 30, 2022	11,262,688
Shares issued under stock-based compensation plans		(171)		(171)
Shares issued under stock-based compensation plans (in shares)	25,221
Stock-based compensation		966		966
Components of comprehensive income:
Net income			11,910	11,910
Ending balance at Sep. 30, 2022	$ 11	$ (108,085)	$ 13,814	$ (94,260)
Ending balance (in shares) at Sep. 30, 2022	11,287,909			11,287,909

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Operating activities
Net income	$ 24,063	$ 15,268
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Depreciation and amortization expense	11,018	11,609
Stock-based compensation expense	2,928	214
Amortization of debt issuance costs and debt discount	1,449	1,880
Loss on debt extinguishment	395	5,048
Deferred income tax	1,192	(752)
Other, net	437	210
Changes in operating assets and liabilities:
Accounts receivable	(14,862)	(10,846)
Inventories	(13,916)	(21,831)
Prepaid expenses and other assets	1,501	(3,340)
Income taxes, net	(1,577)	10,603
Accounts payable	(440)	83
Accrued expenses and other liabilities	(3,208)	7,212
Deferred revenue and customer deposits	2,733	(843)
Cash provided by operating activities	11,713	14,515
Investing activities
Capital expenditures for plant, equipment and leasehold improvements	(14,440)	(4,827)
Other	95	156
Cash used in investing activities	(14,345)	(4,671)
Financing activities
Principal payments on First Lien Term Loan		(312,500)
Principal payments on Senior Credit Facility		(30,000)
Principal payments on Senior Notes	(20,000)
Principal payments on ABL Revolver	(10,000)	(15,000)
Proceeds from Senior Notes		310,000
Proceeds from ABL Revolver, net of discount	35,000	14,750
Debt issuance costs	(262)	(9,452)
Payments on debt extinguishment and other	(831)	(2,663)
Proceeds from finance lease financing	2,074
Payments on finance lease obligations	(2,457)	(1,725)
Cash provided by (used in) financing activities	3,524	(46,590)
Effect of exchange rate on cash	(68)	(4)
Net decrease in cash and cash equivalents	824	(36,750)
Cash and cash equivalents, beginning of period	20,683	57,603
Cash and cash equivalents, end of period	21,507	20,853
Supplemental disclosures of cash flow information
Cash paid during the period for: Interest	27,026	22,107
Cash paid during the period for: Income taxes paid	10,859	4,708
Cash paid during the period for: Income taxes (refunded)	(449)	(9,846)
Right-of-use assets obtained in exchange for lease obligations- Operating leases	816	3,666
Right-of-use assets obtained in exchange for lease obligations- Financing leases	7,783	484
Accounts payable and accrued expenses for capital expenditures for plant, equipment and leasehold improvements	$ 1,781	$ 1,005

Business Overview and Summary o

Business Overview and Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2022
Business Overview and Summary of Significant Accounting Policies
Business Overview and Summary of Significant Accounting Policies	CPI Card Group Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (dollars in thousands, except share and per share amounts or as otherwise indicated) (Unaudited) 1. Business Overview and Summary of Significant Accounting Policies Business Overview CPI Card Group Inc. (which, together with its subsidiary companies, is referred to herein as “CPI” or the “Company”) is a payment technology company and leading provider of comprehensive Financial Payment Card solutions in the United States. CPI is engaged in the design, production, data personalization, packaging and fulfillment of Financial Payment Cards, which the Company defines as credit, debit and Prepaid Debit Cards (defined below) issued on the networks of the Payment Card Brands (Visa, Mastercard ® , American Express ® and Discover ® ). CPI defines “Prepaid Debit Cards” as debit cards issued on the networks of the Payment Card Brands, but not linked to a traditional bank account. CPI also offers an instant card issuance solution, which provides bank customers the ability to issue a personalized debit or credit card within the bank branch to individual cardholders. CPI serves its customers through a network of high-security production and card services facilities in the United States, each of which is audited for compliance with the standards of the Payment Card Industry Security Standards Council by one or more of the Payment Card Brands. CPI’s leading network of high-security production facilities allows the Company to optimize its solutions offerings and serve its customers . COVID-19 Update The COVID-19 pandemic and associated counteracting measures implemented by governments and businesses around the world have impacted, and continue to impact, economies and societies globally, including the locations where CPI, its customers and suppliers conduct business. The Company believes the global impacts from COVID-19, along with other macro-economic factors, have contributed to, among other things certain adverse effects on its supply chain, production lead times, labor availability, employee absenteeism and costs. Though the Company has implemented measures to attempt to mitigate the impacts of the challenges described above, the Company believes that such impacts, and the associated costs, may continue throughout 2022 and beyond. The long-term implications of COVID-19 on the Company’s results of operations and overall financial performance remain uncertain, though the health and safety of CPI employees remains paramount. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act was signed into law. The CARES Act, among other things, included provisions relating to refundable payroll tax credits, deferment of employer social security payments, changes in net operating loss carryback periods, alternative minimum tax credit refunds, modifications to the net interest deduction limitation and technical corrections to tax depreciation methods for qualified improvement property. The Company deferred employer social security payments in 2020 in accordance with the CARES Act, and the first installment repayment was made in the fourth quarter of 2021. The second installment payment is permitted to be paid no later than the fourth quarter of 2022 and had not been paid as of September 30, 2022. Basis of Presentation Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted pursuant to Form 10-Q and Article 8 of Regulation S-X. In the opinion of management, these financial statements reflect all adjustments (consisting of normal recurring adjustments) considered necessary for the fair statement of the results of the interim periods presented. The condensed consolidated balance sheet as of December 31, 2021 is derived from the audited financial statements as of that date. The accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. Use of Estimates Management uses estimates and assumptions relating to the reporting of assets and liabilities at the date of the financial statements, the reported revenues and expenses recognized during the reporting period, and certain financial statement disclosures in the preparation of the condensed consolidated financial statements. Significant items subject to such estimates and assumptions include the carrying amount of property and equipment, goodwill and intangible assets, leases, liability for sales tax, valuation allowances for inventories and deferred taxes, revenue recognized for work performed but not completed and uncertain tax positions. Actual results could differ from those estimates. Recent Accounting Standards Recently Issued Accounting Standards In June 2016, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) 2016-13, Measurement of Credit Losses on Financial Instruments Credit Losses Effective Dates. The Company is evaluating the impact of adoption of this standard and does not anticipate the application of ASU 2016-13 will have a material impact on the Company’s consolidated financial position or results of operations.

Net Sales

Net Sales	9 Months Ended
Net Sales	Sep. 30, 2022
Net Sales.
Net Sales	2. Net Sales The Company disaggregates its net sales by major source as follows: Three Months Ended September 30, 2022 Products Services Total Debit and Credit $ 71,857 $ 27,655 $ 99,512 Prepaid Debit - 25,335 25,335 Intersegment eliminations (251) (19) (270) Total $ 71,606 $ 52,971 $ 124,577 Nine Months Ended September 30, 2022 Products Services Total Debit and Credit $ 209,236 $ 76,472 $ 285,708 Prepaid Debit — 64,010 64,010 Intersegment eliminations (369) (40) (409) Total $ 208,867 $ 140,442 $ 349,309 Three Months Ended September 30, 2021 Products Services Total Debit and Credit $ 52,292 $ 23,829 $ 76,121 Prepaid Debit — 23,498 23,498 Intersegment eliminations (16) (1) (17) Total $ 52,276 $ 47,326 $ 99,602 Nine Months Ended September 30, 2021 Products Services Total Debit and Credit $ 146,651 $ 72,147 $ 218,798 Prepaid Debit — 63,339 63,339 Intersegment eliminations (206) (18) (224) Total $ 146,445 $ 135,468 $ 281,913 Products Net Sales “Products” net sales are recognized when obligations under the terms of a contract with a customer are satisfied. In most instances, this occurs over time as cards are produced for specific customers and have no alternative use and the Company has an enforceable right to payment for work performed. For work performed but not completed and unbilled, the Company estimates revenue by taking actual costs incurred and applying historical margins for similar types of contracts. Items included in “Products” net sales are produced Financial Payment Cards, including contact-EMV ® ® TM ® EMV ® is a registered trademark in the U.S. and other countries and an unregistered trademark elsewhere. The EMV trademark is owned by EMV Co, LLC Services Net Sales Net sales are recognized for “Services” as the services are performed. Items included in “Services” net sales include the personalization and fulfillment of Financial Payment Cards, providing tamper-evident secure packaging and fulfillment services to Prepaid Debit Card program managers, and software as a service personalization of instant issuance debit cards. As applicable, for work performed but not completed and unbilled, the Company estimates revenue by taking actual costs incurred and applying historical margins for similar types of contracts. Customer Contracts The Company often enters into Master Services Agreements (“MSAs”) with its customers. Generally, enforceable rights and obligations for goods and services occur only when a customer places a purchase order or statement of work to obtain goods or services under an MSA. The contract term as defined by ASC 606, Revenue from Contracts with Customers

Accounts Receivable

Accounts Receivable	9 Months Ended
Accounts Receivable	Sep. 30, 2022
Accounts Receivable
Accounts Receivable	3. Accounts Receivable Accounts receivable consisted of the following: September 30, December 31, 2022 2021 Trade accounts receivable $ 62,561 $ 50,042 Unbilled accounts receivable 13,357 10,997 75,918 61,039 Less allowance for doubtful accounts (169) (86) $ 75,749 $ 60,953

Inventories

Inventories	9 Months Ended
Inventories	Sep. 30, 2022
Inventories
Inventories	4 Inventories Inventories consisted of the following: September 30, December 31, 2022 2021 Raw materials $ 64,924 $ 54,254 Finished goods 10,024 6,778 Inventory reserve (2,729) (3,023) $ 72,219 $ 58,009

Plant, Equipment, Leasehold Imp

Plant, Equipment, Leasehold Improvements and Operating Lease Right-of-Use Assets	9 Months Ended
	Sep. 30, 2022
Plant, Equipment, Leasehold Improvements and Operating Lease Right-of-Use Assets
Plant, Equipment, Leasehold Improvements and Operating Lease Right-of-Use Assets	5. Plant, Equipment, Leasehold Improvements and Operating Lease Right-of-Use Assets Plant, equipment, leasehold improvements and operating lease right-of-use assets consisted of the following: September 30, December 31, 2022 2021 Machinery and equipment $ 61,302 $ 64,051 Machinery and equipment under financing leases 14,375 9,088 Furniture, fixtures and computer equipment 2,774 4,570 Leasehold improvements 14,508 14,142 Construction in progress 5,208 5,268 98,167 97,119 Less accumulated depreciation and amortization (52,240) (61,937) Operating lease right-of-use assets, net of accumulated amortization 11,341 12,069 $ 57,268 $ 47,251 Depreciation expense of plant, equipment and leasehold improvements, including depreciation of assets under financing leases, was $2,870 and $2,482 for the three months ended September 30, 2022 and 2021, respectively, and $8,118 and $8,223 for the nine months ended September 30, 2022 and 2021, respectively. Operating lease right-of-use assets, net of accumulated amortization, are further described in Note 9, “Financing and Operating Leases.”

Goodwill and Other Intangible A

Goodwill and Other Intangible Assets	9 Months Ended
Goodwill and Other Intangible Assets	Sep. 30, 2022
Goodwill and Other Intangible Assets
Goodwill and Other Intangible Assets	6. Goodwill and Other Intangible Assets The Company reports all of its goodwill in the Debit and Credit segment at September 30, 2022 and December 31, 2021. Goodwill is tested for impairment at least annually on October 1 or more frequently when an event occurs or circumstances change that indicate the carrying value may not be recoverable. Intangible assets consist of customer relationships, technology, and trademarks. Intangible amortization expense was $967 and $1,088 for the three months ended September 30, 2022 and 2021, respectively, and $2,900 and $3,386 for the nine months ended September 30, 2022 and 2021, respectively. At September 30, 2022 and December 31, 2021, intangible assets, excluding goodwill, were comprised of the following: September 30, December 31, 2022 2021 Weighted Average Accumulated Net Book Accumulated Net Book Life (Years) Cost Amortization Value Cost Amortization Value Customer relationships 17.2 $ 55,454 $ (37,877) $ 17,577 $ 55,454 $ (35,419) $ 20,035 Technology 10 7,101 (6,717) 384 7,101 (6,567) 534 Trademarks 8.7 3,330 (2,337) 993 3,330 (2,045) 1,285 Intangible assets subject to amortization $ 65,885 $ (46,931) $ 18,954 $ 65,885 $ (44,031) $ 21,854 The estimated future aggregate amortization expense for the identified amortizable intangibles noted above as of September 30, 2022 was as follows: 2022 (excluding the nine months ended September 30, 2022) $ 966 2023 3,867 2024 3,630 2025 3,440 2026 2,471 Thereafter 4,580 $ 18,954

Fair Value of Financial Instrum

Fair Value of Financial Instruments	9 Months Ended
Fair Value of Financial Instruments	Sep. 30, 2022
Fair Value of Financial Instruments
Fair Value of Financial Instruments	7. Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). In determining fair value, the Company utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels: ● Level 1—Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date. ● Level 2— Observable inputs other than Level 1 prices, such as quoted prices in active markets for similar assets and liabilities, quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term for the assets or liabilities. ● Level 3— Valuations based on unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at the measurement date. The Company’s financial assets and liabilities that are not required to be re-measured at fair value in the condensed consolidated balance sheets were as follows: Carrying Estimated Value as of Fair Value as of Fair Value Measurement at September 30, 2022 September 30, September 30, (Using Fair Value Hierarchy) 2022 2022 Level 1 Level 2 Level 3 Liabilities: Senior Notes $ 290,000 $ 279,125 $ — $ 279,125 $ — ABL Revolver $ 25,000 $ 25,000 $ — $ 25,000 $ — Carrying Estimated Value as of Fair Value as of Fair Value Measurement at December 31, 2021 December 31, December 31, (Using Fair Value Hierarchy) 2021 2021 Level 1 Level 2 Level 3 Liabilities: Senior Notes $ 310,000 $ 327,050 $ — $ 327,050 $ — The aggregate fair value of the Company’s Senior Notes (as defined in Note 10, “Long-Term Debt”) was based on bank quotes. The fair value measurement associated with the ABL Revolver (as defined in Note 10, “Long-Term Debt”) approximates its carrying value as of September 30, 2022, given the applicable variable interest rates and nature of the security interest in Company assets. The carrying amounts for cash and cash equivalents, accounts receivable and accounts payable each approximate fair value due to their short-term nature.

Accrued Expenses

Accrued Expenses	9 Months Ended
Accrued Expenses	Sep. 30, 2022
Accrued Expenses.
Accrued Expenses	8. Accrued Expenses Accrued expenses consisted of the following: September 30, December 31, 2022 2021 Accrued payroll and related employee expenses $ 8,697 $ 7,558 Accrued employee performance bonuses 6,975 6,900 Employer payroll taxes, including social security deferral 2,277 1,910 Accrued rebates 2,040 1,423 Estimated sales tax liability 762 1,019 Accrued interest 1,105 7,955 Current operating and financing lease liabilities 5,445 4,114 Other 7,083 6,271 Total accrued expenses $ 34,384 $ 37,150 The estimated sales tax liability is further described in Note 14, “Commitments and Contingencies” and Note 1, “Business Overview and Summary of Significant Accounting Policies.”

Financing and Operating Leases

Financing and Operating Leases	9 Months Ended
Financing and Operating Leases	Sep. 30, 2022
Financing and Operating Leases
Financing and Operating Leases	9. Financing and Operating Leases Right-of-use (“ROU”) represents the right to use an underlying asset for the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. A lease is deemed to exist when the Company has the right to control the use of identified property, plant or equipment, as conveyed through a contract, for a certain period of time and consideration paid. The right to control is deemed to occur when the Company has the right to obtain substantially all of the economic benefits of the identified assets and the right to direct the use of such assets. The components of operating and finance lease costs were as follows: Three Months Ended Three Months Ended September 30, 2022 September 30, 2021 Operating lease costs $ 783 $ 538 Variable lease costs 184 181 Short-term operating lease costs — 122 Total expense from operating leases $ 967 $ 841 Finance lease costs: Right-of-use amortization expense $ 449 $ 256 Interest on lease liabilities 116 92 Total financing lease costs $ 565 $ 348 Nine Months Ended Nine Months Ended September 30, 2022 September 30, 2021 Operating lease costs $ 2,282 $ 1,580 Variable lease costs 470 509 Short-term operating lease costs — 416 Total expense from operating leases $ 2,752 $ 2,505 Finance lease costs: Right-of-use amortization expense $ 1,233 $ 751 Interest on lease liabilities 334 297 Total financing lease costs $ 1,567 $ 1,048 The following table reflects balances for operating and financing leases: September 30, December 31, 2022 2021 Operating leases: Operating lease right-of-use assets, net of amortization $ 11,341 $ 12,069 Current operating lease liabilities $ 2,304 $ 1,857 Non-current operating lease liabilities 9,514 10,703 Total operating lease liabilities $ 11,818 $ 12,560 Financing leases: Property, equipment and leasehold improvements $ 14,375 $ 9,088 Accumulated depreciation (2,644) (2,451) Total financing leases in property, equipment and leasehold ___ $ 11,731 $ 6,637 Current financing lease liabilities $ 3,141 $ 2,257 Non-current financing lease liabilities 7,110 2,668 Total financing lease liabilities $ 10,251 $ 4,925 Finance and operating lease ROU assets are recorded in “Plant, equipment, leasehold improvements and operating lease right-of-use assets, net.” Financing and operating lease liabilities are recorded in “Accrued expenses” and “Other long-term liabilities.” Future cash payment with respect to lease obligations as of September 30, 2022 were as follows: Operating Financing Leases Leases 2022 (excluding the nine months ended September 30, 2022) $ 788 $ 1,040 2023 3,164 3,626 2024 2,896 2,828 2025 2,090 2,537 2026 1,958 1,175 Thereafter 3,657 271 Total lease payments 14,553 11,477 Less imputed interest (2,735) (1,226) Total $ 11,818 $ 10,251

Long-Term Debt

Long-Term Debt	9 Months Ended
Long-Term Debt	Sep. 30, 2022
Long-Term Debt.
Long-Term Debt	10. Long-Term Debt At September 30, 2022 and December 31, 2021, long-term debt consisted of the following: Interest September 30, December 31, Rate (1) 2022 2021 Senior Notes 8.625 % $ 290,000 $ 310,000 ABL Revolver 4.701 % 25,000 — Unamortized deferred financing costs (4,909) (6,374) Total long-term debt 310,091 303,626 Less current maturities — — Long-term debt, net of current maturities $ 310,091 $ 303,626 (1) The Senior Notes bear interest at a fixed rate. The interest rate on the ABL Revolver represents the average effective variable interest rate on outstanding borrowings as of September 30, 2022. On March 15, 2021, the Company completed a private offering by its wholly-owned subsidiary, CPI CG Inc., of $310,000 aggregate principal amount of 8.625% Senior Secured Notes due 2026 (the “Senior Notes”) and related guarantees. The Senior Notes bear interest at a rate of 8.625% per annum and mature on March 15, 2026. Interest is payable on the Senior Notes on March 15 and September 15 of each year. On March 15, 2021, the Company and CPI CG Inc., as borrower, entered into a Credit Agreement with Wells Fargo Bank, National Association, as lender, administrative agent and collateral agent, providing for an asset-based, senior secured revolving credit facility of up to $50,000 (the “ABL Revolver”). The ABL Revolver matures on the earliest to occur of March 15, 2026 and the date that is 90 days prior to the maturity of the Senior Notes. On March 3, 2022, the Company and CPI CG Inc. entered into Amendment No. 1 to the Credit Agreement (the “Amendment”), which amended the ABL Revolver. The Amendment, among other things, increased the available borrowing capacity under the ABL Revolver to $75,000, increased the uncommitted accordion feature to $25,000 from $15,000, and revised the interest rate provisions to replace the prior LIBOR benchmark with updated benchmark provisions using the secured overnight financing rate (“SOFR”) administered by the Federal Reserve Bank of New York. On October 11, 2022, the Company and CPI CG Inc. entered into Amendment No. 2 to the Credit Agreement, which amended the ABL Revolver to adjust certain monthly document delivery terms and to clarify the treatment of certain inventory. Borrowings under the amended ABL Revolver bear interest at a rate per annum equal to the applicable term SOFR adjusted for a credit spread, plus an applicable interest rate margin. The Company may select a one, three or six month term SOFR, which is adjusted for a credit spread of 0.10% to 0.30% depending on the term selected. For each quarter through March 31, 2023, the applicable interest rate margin ranges from 1.50% to 1.75% depending on the average unused capacity of the facility for the previous quarter. The unused portion of the ABL Revolver commitment accrues a monthly commitment fee, 0.50% per annum through March 31, 2023, based on the average daily borrowing capacity under the ABL Revolver over the previous month. Unused commitment fee expense was $179 and $118 for the nine months ended September 30, 2022 and 2021, respectively. The interest rate margin and unused commitment fee percentage changes, effective April 1, 2023, to between 1.25% and 1.75% (interest rate margin) and 0.375% and 0.50% (unused commitment fee). The ABL Revolver includes limitations on the Company’s ability to borrow in certain situations, including limitations based on the calculation of a borrowing capacity and further limitations that are triggered if the amount available to borrow under the ABL Revolver is less than $7,500. The borrowing capacity represents the net availability under the ABL Revolver and is calculated as the lesser of a) the total of certain eligible assets, including cash, accounts receivable and inventories, further reduced by stated contribution percentages and adjustments or b) the $75,000 of available borrowing capacity under the ABL Revolver (“Borrowing Base”). The Borrowing Base is further reduced by credit line reserves, letters of credit, as well as the loan ledger balance outstanding on the ABL Revolver. Additionally, commencing with the month immediately following a date on which borrowing capacity is below $7,500 and until such time that borrowing capacity equals or exceeds $7,500 for 30 consecutive days, the Company must maintain a fixed charge coverage ratio (as defined in the Credit Agreement for the ABL Revolver) greater than 1.00 On March 15, 2021, the Company used net proceeds from the Senior Notes, together with cash on hand and initial borrowings of $15,000 under the ABL Revolver, to pay in full and terminate a previous Senior Credit Facility and a previous First Lien Term Loan on March 15, 2021, and to pay related fees and expenses. Early termination of the Senior Credit Facility required payment of a “make-whole” premium of $2,635 as an early termination penalty, which was paid on March 15, 2021, and recorded as interest expense on the condensed consolidated statement of comprehensive income for the year ended December 31, 2021. On March 11, 2022, the Company used the available borrowing capacity under the ABL Revolver to fund the redemption of $20,000 aggregate principal amount of the Senior Notes at a redemption price equal to 103% of the principal amount thereof plus accrued and unpaid interest thereon to the redemption date. The Senior Notes are guaranteed by the Company and certain of its current and future wholly-owned domestic subsidiaries (other than CPI CG Inc. as the issuer of the Senior Notes) that guarantee the ABL Revolver. The Senior Notes are secured by substantially all of the assets of CPI CG Inc. and the guarantors, subject to customary exceptions. The ABL Revolver is guaranteed by the Company and its subsidiaries (other than CPI CG Inc. as borrower and excluded subsidiaries), and is secured by substantially all of the assets of CPI CG Inc. and the guarantors, subject to customary exceptions. The Senior Notes and the ABL Revolver contain covenants limiting the ability of the Company, CPI CG Inc. and the Company’s restricted subsidiaries to, among other things, incur or guarantee additional debt or issue disqualified stock or certain preferred stock; create or incur liens; pay dividends, redeem stock or make other distributions; make certain investments; create restrictions on the ability of CPI CG Inc. and its restricted subsidiaries to pay dividends to the Company or make other intercompany transfers; transfer or sell assets; merge or consolidate; and enter into certain transactions with affiliates, subject to a number of important exceptions and qualifications as set forth in the respective agreements. The Company has obligations to make an offer to repay the Senior Notes, requiring prepayment in advance of the maturity date, upon the occurrence of certain events including a change of control, certain asset sales and based on an annual excess cash flow calculation. The annual excess cash flow calculation is determined pursuant to the terms of that certain Indenture, dated as of March 15, 2021, by and among CPI CG Inc., the Company, the subsidiary guarantors and U.S. Bank National Association, as trustee, with any required prepayments to be made after the issuance of the Company’s annual financial statements. No such payment was required to be made in 2022 based on the Company’s operating results for the year ended December 31, 2021. Deferred Financing Costs and Discount Certain costs and discounts incurred with borrowings are reflected as a reduction to the long-term debt balance. These costs are amortized as an adjustment to interest expense over the life of the borrowing using the effective-interest rate method. The remaining unamortized debt issuance costs recorded on the Senior Notes were $4,909 and is reported as a reduction to the long-term debt balance as of September 30, 2022. The remaining unamortized net discount and debt issuance costs on the ABL Revolver and related Amendment were $1,670 and are recorded as other assets (current and long-term) on the condensed consolidated balance sheet as of September 30, 2022. During the nine months ended September 30, 2021, the Company recorded a $5,048 loss on debt extinguishment relating to the unamortized deferred financing costs and debt discount in connection with the termination of the Senior Credit Facility and First Lien Term Loan, as described earlier.

Income Taxes

Income Taxes	9 Months Ended
Income Taxes	Sep. 30, 2022
Income Taxes
Income Taxes	11. Income Taxes The Company’s effective tax rates on pre-tax income were 25.8% and 30.3% for the three months ended September 30, 2022 and 2021, respectively, and 28.5% and 30.7% for the nine months ended September 2022 and 2021, respectively. The decrease in the Company’s effective tax rate for the three and nine months compared to the corresponding periods in the prior year was primarily due to a greater proportion of pre-tax income in relation to the impact of permanent items. The effective tax rate for the three months ended September 30, 2022 also decreased as a result of the release of a federal valuation allowance for increased deductibility of interest costs due to a tax election made in the current year. For the nine months ended September 30, 2022 and 2021, the effective tax rate differs from the U.S. federal statutory income tax rate as follows: September 30, 2022 2021 Tax at federal statutory rate 21.0 % 21.0 % State taxes, net 5.5 6.2 Valuation allowance — — Permanent items 1.3 2.8 Other 0.7 0.7 Effective income tax rate 28.5 % 30.7 %

Stockholders' Deficit

Stockholders' Deficit	9 Months Ended
Stockholders' Deficit	Sep. 30, 2022
Stockholders' Deficit
Stockholders' Deficit	12. Stockholders’ Deficit Common Stock Common Stock has a par value of $0.001 per share. Holders of Common Stock are entitled to receive dividends and distributions subject to the participation rights of holders of all classes of stock at the time outstanding, as such holders may have prior rights as to dividends pursuant to the rights of any series of Preferred Stock. Upon any liquidation, dissolution or winding up of the Company, after required payments are made to holders of any series of Preferred Stock, any remaining assets of the Company will be distributed ratably to the holders of Common Stock. Holders of Common Stock are entitled to one vote per share.

Earnings per Share

Earnings per Share	9 Months Ended
Earnings per Share	Sep. 30, 2022
Earnings per Share
Earnings per Share	13. Earnings per Share Basic and diluted earnings per share is computed by dividing net income by the weighted-average number of common shares outstanding during the period. The following table sets forth the computation of basic and diluted earnings per share: Three Months Ended Nine Months Ended September 30, September 30, 2022 2021 2022 2021 Numerator: Net income $ 11,910 $ 6,626 $ 24,063 $ 15,268 Denominator: Basic weighted-average common shares outstanding 11,265,767 11,238,678 11,259,655 11,234,054 Dilutive shares 523,154 560,643 471,013 521,327 Diluted weighted-average common shares outstanding 11,788,921 11,799,321 11,730,668 11,755,381 Basic earnings per share $ 1.06 $ 0.59 $ 2.14 $ 1.36 Diluted earnings per share $ 1.01 $ 0.56 $ 2.05 $ 1.30

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
Commitments and Contingencies	Sep. 30, 2022
Commitments and Contingencies
Commitments and Contingencies	14. Commitments and Contingencies Commitments Refer to Note 9, “Financing and Operating Leases” for details on the Company’s future cash payments with respect to financing and operating leases. During the normal course of business, the Company enters into non-cancellable agreements to purchase goods and services, including production equipment and information technology systems. The Company leases real property for its facilities under non-cancellable operating lease agreements. Land and facility leases expire at various dates between 2023 and 2029 and contain various provisions for rental adjustments and renewals. The leases typically require the Company to pay property taxes, insurance and normal maintenance costs. The Company’s financing leases expire at various dates between 2022 and 2027 and contain purchase options which the Company may exercise to keep the machinery in use. Contingencies In accordance with applicable accounting guidance, the Company establishes an accrued expense when loss contingencies are both probable and estimable. In such cases, there may be an exposure to loss in excess of any amounts accrued. As a matter develops, the Company, in conjunction with any outside counsel handling the matter, evaluates on an ongoing basis whether such matter presents a loss contingency that is probable and estimable. Once the loss contingency is deemed to be both probable and estimable, the Company will establish an accrued expense and record a corresponding amount of expense. The Company expenses professional fees associated with litigation claims and assessments as incurred. Smart Packaging Solutions SA v. CPI Card Group Inc. On April 20, 2021, Smart Packaging Solutions, SA (“SPS”) filed a patent infringement lawsuit against the Company in the United States District Court for the District of Delaware seeking an unspecified amount of damages and equitable relief. In the complaint, SPS alleges that the Company infringed four patents that SPS has exclusively licensed from Feinics AmaTech Teoranta. The patents all relate to antenna technology. SPS alleges that the Company incorporates the patented technology into its products that use contactless communication. The Company does not manufacture antennas; it purchases certain antenna-related components from SPS and a number of other suppliers. The Company’s motion to dismiss the complaint is currently pending. Additionally, a third party, Infineon, has filed requests for Inter Parties Review (“IPR”) proceedings concerning each of the four patents. As a result, the Delaware District Court stayed the case pending resolution of the requests for review. Thus far, the United States Patent Office has instituted proceedings with respect to three of the IPR requests and the other remains pending. The current proceedings in the patent office are scheduled to run through June 22, 2023. Should the remaining IPR request be denied or should the patents survive review by the United States Patent Office, the Company intends to defend the suit vigorously. However, no assurance can be given that this matter will be resolved favorably. Due to the stage of this matter, the Company is unable to predict the outcome or the possible loss or range of loss, if any, associated with this matter, and no liability has been recorded as of September 30, 2022 In addition to the matter described above, the Company may be subject to routine legal proceedings in the ordinary course of business. The Company believes that the ultimate resolution of any such matters will not have a material adverse effect on its business, financial condition or results of operations. Estimated Sales Tax Liability The Company has continued to evaluate a state sales tax liability analysis for states in which it has economic nexus and to collect exemption documentation from its customers. It is probable that the Company will be subject to sales tax liabilities plus interest and penalties relating to historical activity in certain states. The estimated liability for sales tax as of September 30, 2022 and December 31, 2021 was $762 and $1,019 , respectively, and is recorded in a ccrued expenses in the condensed consolidated balance sheets. The liability decreased from the estimate recorded in the prior period primarily due to the Company remitting cash to the applicable state tax authorities for historical sales tax and interest. The Company may be subject to examination by the relevant state tax authorities. Due to the estimates involved in the analysis, the liability may change in the future. The Company is unable to predict a range of additional loss that is reasonably possible. Sales tax recovered from customers reduces the estimated expense when it is received or probable of collection . Future changes to the liability that impact the condensed consolidated statements of operations will be recorded within “Selling, general and administrative” (“SG&A”). During the nine months ended September 30, 2022 and 2021, the Company recorded sales tax expense of $74 and sales tax benefit of $465 , respectively, within SG&A for current activity relating to updates to the estimated liability. Voluntary Disclosure Program The Company is subject to unclaimed or abandoned property (escheat) laws which require it to turn over to state governmental authorities the property of others held by the Company that has been unclaimed for specified periods of time. Property subject to escheat laws generally relates to uncashed checks, trade accounts receivable credits and unpaid payable balances. During the second quarter of 2022, the Company received a letter from the Delaware Secretary of State inviting the Company to participate in the Delaware Secretary of State’s Abandoned or Unclaimed Property Voluntary Disclosure Agreement Program to avoid being sent an audit notice by the Delaware Department of Finance. On August 31, 2022, the Company entered into Delaware’s Voluntary Disclosure Agreement Program in order to voluntarily comply with Delaware’s abandoned property law in exchange for certain protections and benefits. The Company intends to work in good faith to complete a review of its books and records related to unclaimed or abandoned property during the periods required under the program. Any potential loss, or range of loss, that may result from this matter is not currently reasonably estimable.

Stock Based Compensation

Stock Based Compensation	9 Months Ended
Stock Based Compensation	Sep. 30, 2022
Stock Based Compensation
Stock Based Compensation	15. Stock-Based Compensation CPI Card Group Inc. Omnibus Incentive Plan In October 2015, the Company adopted the CPI Card Group Inc. Omnibus Incentive Plan (the “Omnibus Plan”) pursuant to which cash and equity-based incentives may be granted to participating employees, advisors and directors. On May 27, 2021, the Company’s stockholders approved an amendment and restatement of the Omnibus Plan to, among other things, increase the total number of shares of the Company’s Common Stock reserved and available for issuance thereunder by 1,000,000 shares resulting in a total of 2,200,000 shares of Common Stock issuable under the Omnibus Plan. As of September 30, 2022, there were 879,197 shares of Common Stock available for grant under the Omnibus Plan. During the nine months ended September 30, 2022, the Company granted 44,905 awards of non-qualified stock options. The Company granted 115,659 awards of non-qualified stock options of during the nine months ended September 30, 2021. The following is a summary of the activity in outstanding stock options under the Omnibus Plan: Weighted- Weighted- Average Average Remaining Exercise Contractual Term Options Price (in Years) Outstanding as of December 31, 2021 778,835 $ 18.02 5.59 Granted 44,905 14.95 6.47 Exercised (18,186) 4.31 Expired (1,320) 21.75 Forfeited (10,457) 28.03 Outstanding as of September 30, 2022 793,777 $ 18.02 4.92 Options vested and exercisable as of September 30, 2022 684,927 $ 17.12 4.71 Options vested and expected to vest as of September 30, 2022 793,777 $ 18.02 4.92 The following is a summary of the activity in unvested stock options under the Omnibus Plan: Weighted-Average Options Grant-Date Fair Value Unvested as of December 31, 2021 127,357 $ 17.42 Granted 44,905 8.99 Vested (52,955) 17.43 Forfeited (10,457) 16.52 Unvested as of September 30, 2022 108,850 $ 14.03 Unvested stock options of 108,850 as of September 30, 2022 have a seven year term and are expected to vest ratably over a two-year period on each anniversary of the grant date. The fair value of the stock option awards granted during the nine months ended September 30, 2022, was determined using a Black-Scholes option-pricing model with the following weighted-average assumptions: Nine Months Ended September 30, 2022 2021 Expected term in years (1) 4.3 4.3 Volatility (2) 77.6 % 78.6 % Risk-free interest rate (3) 2.9 % 0.7 % Dividend yield (4) — % — % (1) The Company estimated the expected term based on the average of the weighted-average vesting period and the contractual term of the stock option awards by utilizing the “simplified method”, as the Company does not have sufficient available historical data to estimate the expected term of these stock option awards. (2) Volatility was based on a weighting of the Company’s historical volatility and its peer group, which is comprised of companies with similar industry, size and financial leverage. (3) The risk-free interest rate was determined by using the United States Treasury rate for the period consistent with the expected option term described above. (4) The Company’s expected annual dividend yield was zero based on current practice. The following table summarizes the changes in the number of outstanding restricted stock units: Weighted- Average Weighted- Remaining Average Amortization Grant-Date Period Shares Fair Value (in Years) Outstanding as of December 31, 2021 261,982 $ 13.19 Granted 27,007 14.95 Vested (31,258) 29.62 Forfeited (18,247) 10.89 Outstanding as of September 30, 2022 239,484 $ 11.42 1.26 The restricted stock unit awards contain conditions associated with continued employment or service. Restricted stock units granted in 2022 are expected to vest ratably over a two-year period on each anniversary of the grant date. On the vesting date, shares of Common Stock will be issued to the award recipients. Compensation expense for the Omnibus Plan for the three months ended September 30, 2022 and 2021 was $966 and $116 , respectively. Compensation expense for the Omnibus Plan for the nine months ended September 30, 2022 and 2021 was $2,928 and $214 , respectively. As of September 30, 2022, the total unrecognized compensation expense related to unvested options and restricted stock units is $1,892 , which the Company expects to recognize over an estimated weighted-average period of approximately 1.14 years.

Segment Reporting

Segment Reporting	9 Months Ended
Segment Reporting	Sep. 30, 2022
Segment Reporting
Segment Reporting	16. Segment Reporting The Company has identified reportable segments that represent 10% or more of its net sales, EBITDA (as defined below) or total assets, or when the Company believes information about the segment would be useful to the readers of the financial statements. The Company’s chief operating decision maker is its Chief Executive Officer, who is charged with management of the Company and is responsible for the evaluation of operating performance and decision making about the allocation of resources to operating segments based on measures, such as net sales and EBITDA. EBITDA is the primary measure used by the Company’s chief operating decision maker to evaluate segment operating performance. As the Company uses the term, “EBITDA” is defined as income before interest expense, income taxes, depreciation and amortization. The Company’s chief operating decision maker believes EBITDA is a meaningful measure and is useful as a supplement to GAAP measures as it represents a transparent view of the Company’s operating performance that is unaffected by fluctuations in property, equipment and leasehold improvement additions. The Company’s chief operating decision maker uses EBITDA to perform periodic reviews and comparison of operating trends and to identify strategies to improve the allocation of resources amongst segments. As of September 30, 2022, the Company’s reportable segments were as follows: ● Debit and Credit; ● Prepaid Debit; and ● Other. Debit and Credit Segment The Debit and Credit segment primarily produces Financial Payment Cards and provides integrated card services to card-issuing banks primarily in the United States. Products produced by this segment primarily include EMV and non-EMV Financial Payment Cards, including contact and contactless cards, and Earth Elements TM Eco-Focused Cards. The Company also sells Card Once instant card issuance solutions, and private label credit cards that are not issued on the networks of the Payment Card Brands. The Company provides CPI On-Demand ® services, where images, personalized payment cards, and related collateral are produced on a one-by-one, on demand basis for customers. This segment also provides a variety of integrated card services, including card personalization and fulfillment services and instant issuance services. The Debit and Credit segment facilities and operations are audited for compliance with the standards of the Payment Card Industry Security Standards Counsel by multiple Payment Card Brands. Prepaid Debit Segment The Prepaid Debit segment primarily provides integrated prepaid card services to Prepaid Debit Card providers in the United States, including tamper-evident security packaging. This segment also produces Financial Payment Cards issued on the networks of the Payment Card Brands that are included in the tamper-evident security packages. The Prepaid Debit segment facilities and operations are audited for compliance with the standards of the Payment Card Industry Security Standards Counsel by multiple Payment Card Brands. Other The Other segment includes corporate expenses. Performance Measures of Reportable Segments Net Sales and EBITDA of the Company’s reportable segments for the three and nine months ended September 30, 2022 and 2021, were as follows: Net Sales Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Debit and Credit $ 99,512 $ 76,121 $ 285,708 $ 218,798 Prepaid Debit 25,335 23,498 64,010 63,339 Intersegment eliminations (270) (17) (409) (224) Total $ 124,577 $ 99,602 $ 349,309 $ 281,913 EBITDA Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Debit and Credit $ 31,675 $ 22,356 $ 85,042 $ 67,078 Prepaid Debit 9,638 9,040 22,101 24,719 Other (14,094) (11,130) (40,119) (34,955) Total $ 27,219 $ 20,266 $ 67,024 $ 56,842 The following table provides a reconciliation of total segment EBITDA to net income for the three and nine months ended September 30, 2022 and 2021: Three Months Ended Nine Months Ended September 30, September 30, 2022 2021 2022 2021 Total segment EBITDA $ 27,219 $ 20,266 $ 67,024 $ 56,842 Interest, net (7,323) (7,183) (22,334) (23,196) Income tax expense (4,149) (2,887) (9,609) (6,769) Depreciation and amortization (3,837) (3,570) (11,018) (11,609) Net income $ 11,910 $ 6,626 $ 24,063 $ 15,268 Net Sales to Geographic Locations, Property, Equipment and Leasehold Improvements and Long-Lived Assets Each of the Company’s Net Sales, Property, Equipment and Leasehold Improvements, and Long-Lived Assets relating to geographic locations outside of the United States is insignificant.

Business Overview and Summary_2

Business Overview and Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2022
Business Overview and Summary of Significant Accounting Policies
Basis of Presentation	Basis of Presentation Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted pursuant to Form 10-Q and Article 8 of Regulation S-X. In the opinion of management, these financial statements reflect all adjustments (consisting of normal recurring adjustments) considered necessary for the fair statement of the results of the interim periods presented. The condensed consolidated balance sheet as of December 31, 2021 is derived from the audited financial statements as of that date. The accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.
Use of Estimates	Use of Estimates Management uses estimates and assumptions relating to the reporting of assets and liabilities at the date of the financial statements, the reported revenues and expenses recognized during the reporting period, and certain financial statement disclosures in the preparation of the condensed consolidated financial statements. Significant items subject to such estimates and assumptions include the carrying amount of property and equipment, goodwill and intangible assets, leases, liability for sales tax, valuation allowances for inventories and deferred taxes, revenue recognized for work performed but not completed and uncertain tax positions. Actual results could differ from those estimates.
Recent Accounting Standards	Recent Accounting Standards Recently Issued Accounting Standards In June 2016, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) 2016-13, Measurement of Credit Losses on Financial Instruments Credit Losses Effective Dates. The Company is evaluating the impact of adoption of this standard and does not anticipate the application of ASU 2016-13 will have a material impact on the Company’s consolidated financial position or results of operations.

Net Sales (Tables)

Net Sales (Tables)	9 Months Ended
Net Sales (Tables)	Sep. 30, 2022
Net Sales.
Schedule of disaggregation of net sales by major source	Three Months Ended September 30, 2022 Products Services Total Debit and Credit $ 71,857 $ 27,655 $ 99,512 Prepaid Debit - 25,335 25,335 Intersegment eliminations (251) (19) (270) Total $ 71,606 $ 52,971 $ 124,577 Nine Months Ended September 30, 2022 Products Services Total Debit and Credit $ 209,236 $ 76,472 $ 285,708 Prepaid Debit — 64,010 64,010 Intersegment eliminations (369) (40) (409) Total $ 208,867 $ 140,442 $ 349,309 Three Months Ended September 30, 2021 Products Services Total Debit and Credit $ 52,292 $ 23,829 $ 76,121 Prepaid Debit — 23,498 23,498 Intersegment eliminations (16) (1) (17) Total $ 52,276 $ 47,326 $ 99,602 Nine Months Ended September 30, 2021 Products Services Total Debit and Credit $ 146,651 $ 72,147 $ 218,798 Prepaid Debit — 63,339 63,339 Intersegment eliminations (206) (18) (224) Total $ 146,445 $ 135,468 $ 281,913

Accounts Receivable (Tables)

Accounts Receivable (Tables)	9 Months Ended
Accounts Receivable (Tables)	Sep. 30, 2022
Accounts Receivable
Schedule of accounts receivable	September 30, December 31, 2022 2021 Trade accounts receivable $ 62,561 $ 50,042 Unbilled accounts receivable 13,357 10,997 75,918 61,039 Less allowance for doubtful accounts (169) (86) $ 75,749 $ 60,953

Inventories (Tables)

Inventories (Tables)	9 Months Ended
Inventories (Tables)	Sep. 30, 2022
Inventories
Schedule of inventories	September 30, December 31, 2022 2021 Raw materials $ 64,924 $ 54,254 Finished goods 10,024 6,778 Inventory reserve (2,729) (3,023) $ 72,219 $ 58,009

Plant, Equipment, Leasehold I_2

Plant, Equipment, Leasehold Improvements and Operating Lease Right-of-Use Assets (Tables)	9 Months Ended
	Sep. 30, 2022
Plant, Equipment, Leasehold Improvements and Operating Lease Right-of-Use Assets
Schedule of plant, equipment, leasehold improvements and operating lease right-to-use assets	September 30, December 31, 2022 2021 Machinery and equipment $ 61,302 $ 64,051 Machinery and equipment under financing leases 14,375 9,088 Furniture, fixtures and computer equipment 2,774 4,570 Leasehold improvements 14,508 14,142 Construction in progress 5,208 5,268 98,167 97,119 Less accumulated depreciation and amortization (52,240) (61,937) Operating lease right-of-use assets, net of accumulated amortization 11,341 12,069 $ 57,268 $ 47,251

Goodwill and Other Intangible_2

Goodwill and Other Intangible Assets (Tables)	9 Months Ended
Goodwill and Other Intangible Assets (Tables)	Sep. 30, 2022
Goodwill and Other Intangible Assets
Schedule of intangible assets excluding goodwill	September 30, December 31, 2022 2021 Weighted Average Accumulated Net Book Accumulated Net Book Life (Years) Cost Amortization Value Cost Amortization Value Customer relationships 17.2 $ 55,454 $ (37,877) $ 17,577 $ 55,454 $ (35,419) $ 20,035 Technology 10 7,101 (6,717) 384 7,101 (6,567) 534 Trademarks 8.7 3,330 (2,337) 993 3,330 (2,045) 1,285 Intangible assets subject to amortization $ 65,885 $ (46,931) $ 18,954 $ 65,885 $ (44,031) $ 21,854
Schedule of future aggregate amortization expense for identified amortizable intangibles	The estimated future aggregate amortization expense for the identified amortizable intangibles noted above as of September 30, 2022 was as follows: 2022 (excluding the nine months ended September 30, 2022) $ 966 2023 3,867 2024 3,630 2025 3,440 2026 2,471 Thereafter 4,580 $ 18,954

Fair Value of Financial Instr_2

Fair Value of Financial Instruments (Tables)	9 Months Ended
Fair Value of Financial Instruments (Tables)	Sep. 30, 2022
Fair Value of Financial Instruments
Schedule of financial assets and liabilities subject to fair value measurements	The Company’s financial assets and liabilities that are not required to be re-measured at fair value in the condensed consolidated balance sheets were as follows: Carrying Estimated Value as of Fair Value as of Fair Value Measurement at September 30, 2022 September 30, September 30, (Using Fair Value Hierarchy) 2022 2022 Level 1 Level 2 Level 3 Liabilities: Senior Notes $ 290,000 $ 279,125 $ — $ 279,125 $ — ABL Revolver $ 25,000 $ 25,000 $ — $ 25,000 $ — Carrying Estimated Value as of Fair Value as of Fair Value Measurement at December 31, 2021 December 31, December 31, (Using Fair Value Hierarchy) 2021 2021 Level 1 Level 2 Level 3 Liabilities: Senior Notes $ 310,000 $ 327,050 $ — $ 327,050 $ —

Accrued Expenses (Tables)

Accrued Expenses (Tables)	9 Months Ended
Accrued Expenses (Tables)	Sep. 30, 2022
Accrued Expenses.
Schedule of Accrued Expenses	September 30, December 31, 2022 2021 Accrued payroll and related employee expenses $ 8,697 $ 7,558 Accrued employee performance bonuses 6,975 6,900 Employer payroll taxes, including social security deferral 2,277 1,910 Accrued rebates 2,040 1,423 Estimated sales tax liability 762 1,019 Accrued interest 1,105 7,955 Current operating and financing lease liabilities 5,445 4,114 Other 7,083 6,271 Total accrued expenses $ 34,384 $ 37,150

Financing and Operating Leases

Financing and Operating Leases (Tables)	9 Months Ended
Financing and Operating Leases (Tables)	Sep. 30, 2022
Financing and Operating Leases
Schedule of operating and finance lease costs	Three Months Ended Three Months Ended September 30, 2022 September 30, 2021 Operating lease costs $ 783 $ 538 Variable lease costs 184 181 Short-term operating lease costs — 122 Total expense from operating leases $ 967 $ 841 Finance lease costs: Right-of-use amortization expense $ 449 $ 256 Interest on lease liabilities 116 92 Total financing lease costs $ 565 $ 348 Nine Months Ended Nine Months Ended September 30, 2022 September 30, 2021 Operating lease costs $ 2,282 $ 1,580 Variable lease costs 470 509 Short-term operating lease costs — 416 Total expense from operating leases $ 2,752 $ 2,505 Finance lease costs: Right-of-use amortization expense $ 1,233 $ 751 Interest on lease liabilities 334 297 Total financing lease costs $ 1,567 $ 1,048
Schedule of balances for operating and financing leases	September 30, December 31, 2022 2021 Operating leases: Operating lease right-of-use assets, net of amortization $ 11,341 $ 12,069 Current operating lease liabilities $ 2,304 $ 1,857 Non-current operating lease liabilities 9,514 10,703 Total operating lease liabilities $ 11,818 $ 12,560 Financing leases: Property, equipment and leasehold improvements $ 14,375 $ 9,088 Accumulated depreciation (2,644) (2,451) Total financing leases in property, equipment and leasehold ___ $ 11,731 $ 6,637 Current financing lease liabilities $ 3,141 $ 2,257 Non-current financing lease liabilities 7,110 2,668 Total financing lease liabilities $ 10,251 $ 4,925
Schedule of future cash payments with respect to lease obligations	Future cash payment with respect to lease obligations as of September 30, 2022 were as follows: Operating Financing Leases Leases 2022 (excluding the nine months ended September 30, 2022) $ 788 $ 1,040 2023 3,164 3,626 2024 2,896 2,828 2025 2,090 2,537 2026 1,958 1,175 Thereafter 3,657 271 Total lease payments 14,553 11,477 Less imputed interest (2,735) (1,226) Total $ 11,818 $ 10,251

Long-Term Debt (Tables)

Long-Term Debt (Tables)	9 Months Ended
Long-Term Debt (Tables)	Sep. 30, 2022
Long-Term Debt.
Schedule of long-term debt	Interest September 30, December 31, Rate (1) 2022 2021 Senior Notes 8.625 % $ 290,000 $ 310,000 ABL Revolver 4.701 % 25,000 — Unamortized deferred financing costs (4,909) (6,374) Total long-term debt 310,091 303,626 Less current maturities — — Long-term debt, net of current maturities $ 310,091 $ 303,626 (1) The Senior Notes bear interest at a fixed rate. The interest rate on the ABL Revolver represents the average effective variable interest rate on outstanding borrowings as of September 30, 2022.

Income Taxes (Tables)

Income Taxes (Tables)	9 Months Ended
Income Taxes (Tables)	Sep. 30, 2022
Income Taxes
Schedule of effective income tax rate reconciliation	September 30, 2022 2021 Tax at federal statutory rate 21.0 % 21.0 % State taxes, net 5.5 6.2 Valuation allowance — — Permanent items 1.3 2.8 Other 0.7 0.7 Effective income tax rate 28.5 % 30.7 %

Earnings per Share (Tables)

Earnings per Share (Tables)	9 Months Ended
Earnings per Share (Tables)	Sep. 30, 2022
Earnings per Share
Computation of basic and diluted earnings per share	Three Months Ended Nine Months Ended September 30, September 30, 2022 2021 2022 2021 Numerator: Net income $ 11,910 $ 6,626 $ 24,063 $ 15,268 Denominator: Basic weighted-average common shares outstanding 11,265,767 11,238,678 11,259,655 11,234,054 Dilutive shares 523,154 560,643 471,013 521,327 Diluted weighted-average common shares outstanding 11,788,921 11,799,321 11,730,668 11,755,381 Basic earnings per share $ 1.06 $ 0.59 $ 2.14 $ 1.36 Diluted earnings per share $ 1.01 $ 0.56 $ 2.05 $ 1.30

Stock Based Compensation (Table

Stock Based Compensation (Tables)	9 Months Ended
Stock Based Compensation (Tables)	Sep. 30, 2022
Stock Based Compensation
Summary of outstanding and exercisable stock options	Weighted- Weighted- Average Average Remaining Exercise Contractual Term Options Price (in Years) Outstanding as of December 31, 2021 778,835 $ 18.02 5.59 Granted 44,905 14.95 6.47 Exercised (18,186) 4.31 Expired (1,320) 21.75 Forfeited (10,457) 28.03 Outstanding as of September 30, 2022 793,777 $ 18.02 4.92 Options vested and exercisable as of September 30, 2022 684,927 $ 17.12 4.71 Options vested and expected to vest as of September 30, 2022 793,777 $ 18.02 4.92
Schedule of vesting for unvested options	Weighted-Average Options Grant-Date Fair Value Unvested as of December 31, 2021 127,357 $ 17.42 Granted 44,905 8.99 Vested (52,955) 17.43 Forfeited (10,457) 16.52 Unvested as of September 30, 2022 108,850 $ 14.03
Schedule of valuation assumptions	Nine Months Ended September 30, 2022 2021 Expected term in years (1) 4.3 4.3 Volatility (2) 77.6 % 78.6 % Risk-free interest rate (3) 2.9 % 0.7 % Dividend yield (4) — % — % (1) The Company estimated the expected term based on the average of the weighted-average vesting period and the contractual term of the stock option awards by utilizing the “simplified method”, as the Company does not have sufficient available historical data to estimate the expected term of these stock option awards. (2) Volatility was based on a weighting of the Company’s historical volatility and its peer group, which is comprised of companies with similar industry, size and financial leverage. (3) The risk-free interest rate was determined by using the United States Treasury rate for the period consistent with the expected option term described above. (4) The Company’s expected annual dividend yield was zero based on current practice.
Summary of changes in outstanding restricted stock units	Weighted- Average Weighted- Remaining Average Amortization Grant-Date Period Shares Fair Value (in Years) Outstanding as of December 31, 2021 261,982 $ 13.19 Granted 27,007 14.95 Vested (31,258) 29.62 Forfeited (18,247) 10.89 Outstanding as of September 30, 2022 239,484 $ 11.42 1.26

Segment Reporting (Tables)

Segment Reporting (Tables)	9 Months Ended
Segment Reporting (Tables)	Sep. 30, 2022
Segment Reporting
Schedule of revenue and EBITDA of the company's reportable segments	Net Sales Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Debit and Credit $ 99,512 $ 76,121 $ 285,708 $ 218,798 Prepaid Debit 25,335 23,498 64,010 63,339 Intersegment eliminations (270) (17) (409) (224) Total $ 124,577 $ 99,602 $ 349,309 $ 281,913 EBITDA Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Debit and Credit $ 31,675 $ 22,356 $ 85,042 $ 67,078 Prepaid Debit 9,638 9,040 22,101 24,719 Other (14,094) (11,130) (40,119) (34,955) Total $ 27,219 $ 20,266 $ 67,024 $ 56,842
Schedule of reconciliation of total segment EBITDA to income before taxes	Three Months Ended Nine Months Ended September 30, September 30, 2022 2021 2022 2021 Total segment EBITDA $ 27,219 $ 20,266 $ 67,024 $ 56,842 Interest, net (7,323) (7,183) (22,334) (23,196) Income tax expense (4,149) (2,887) (9,609) (6,769) Depreciation and amortization (3,837) (3,570) (11,018) (11,609) Net income $ 11,910 $ 6,626 $ 24,063 $ 15,268

Net Sales (Details)

Net Sales (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Net Sales (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Disaggregation of Revenue
Net Sales	$ 124,577	$ 99,602	$ 349,309	$ 281,913
Operating Segments \| Debit and Credit
Disaggregation of Revenue
Net Sales	99,512	76,121	285,708	218,798
Operating Segments \| Prepaid Debit
Disaggregation of Revenue
Net Sales	25,335	23,498	64,010	63,339
Intersegment eliminations
Disaggregation of Revenue
Net Sales	(270)	(17)	(409)	(224)
Products
Disaggregation of Revenue
Net Sales	71,606	52,276	208,867	146,445
Products \| Operating Segments \| Debit and Credit
Disaggregation of Revenue
Net Sales	71,857	52,292	209,236	146,651
Products \| Intersegment eliminations
Disaggregation of Revenue
Net Sales	(251)	(16)	(369)	(206)
Services
Disaggregation of Revenue
Net Sales	52,971	47,326	140,442	135,468
Services \| Operating Segments \| Debit and Credit
Disaggregation of Revenue
Net Sales	27,655	23,829	76,472	72,147
Services \| Operating Segments \| Prepaid Debit
Disaggregation of Revenue
Net Sales	25,335	23,498	64,010	63,339
Services \| Intersegment eliminations
Disaggregation of Revenue
Net Sales	$ (19)	$ (1)	$ (40)	$ (18)

Accounts Receivable (Details)

Accounts Receivable (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Accounts Receivable
Trade accounts receivable	$ 62,561	$ 50,042
Unbilled accounts receivable	13,357	10,997
Accounts receivable, gross	75,918	61,039
Less allowance for doubtful accounts	(169)	(86)
Accounts receivable, net	$ 75,749	$ 60,953

Inventories (Details)

Inventories (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Inventories
Raw materials	$ 64,924	$ 54,254
Finished goods	10,024	6,778
Inventory reserve	(2,729)	(3,023)
Inventory	$ 72,219	$ 58,009

Plant, Equipment, Leasehold I_3

Plant, Equipment, Leasehold Improvements and Operating Lease Right-of-Use Assets (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Plant, Equipment and Leasehold Improvements
Plant, equipment and leasehold improvements, gross	$ 98,167		$ 98,167		$ 97,119
Less accumulated depreciation and amortization	(52,240)		(52,240)		(61,937)
Operating lease right-of-use assets, net of accumulated amortization	11,341		11,341		12,069
Total property, equipment and leasehold improvements, net	57,268		57,268		47,251
Depreciation	2,870	$ 2,482	8,118	$ 8,223
Machinery and equipment
Plant, Equipment and Leasehold Improvements
Plant, equipment and leasehold improvements, gross	61,302		61,302		64,051
Machinery and equipment under financing leases
Plant, Equipment and Leasehold Improvements
Plant, equipment and leasehold improvements, gross	14,375		14,375		9,088
Furniture, fixtures and computer equipment
Plant, Equipment and Leasehold Improvements
Plant, equipment and leasehold improvements, gross	2,774		2,774		4,570
Leasehold improvements
Plant, Equipment and Leasehold Improvements
Plant, equipment and leasehold improvements, gross	14,508		14,508		14,142
Construction in progress
Plant, Equipment and Leasehold Improvements
Plant, equipment and leasehold improvements, gross	$ 5,208		$ 5,208		$ 5,268

Goodwill and Other Intangible_3

Goodwill and Other Intangible Assets - Intangible Assets (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Intangible Assets
Intangible amortization expense	$ 967	$ 1,088	$ 2,900	$ 3,386
Intangible assets subject to amortization, Gross Book Value	65,885		65,885		$ 65,885
Intangible assets subject to amortization, Accumulated Amortization	(46,931)		(46,931)		(44,031)
Intangible assets subject to amortization, Net Book Value	18,954		$ 18,954		21,854
Customer relationships
Intangible Assets
Weighted Average Life			17 years 2 months 12 days
Intangible assets subject to amortization, Gross Book Value	55,454		$ 55,454		55,454
Intangible assets subject to amortization, Accumulated Amortization	(37,877)		(37,877)		(35,419)
Intangible assets subject to amortization, Net Book Value	17,577		$ 17,577		20,035
Technology
Intangible Assets
Weighted Average Life			10 years
Intangible assets subject to amortization, Gross Book Value	7,101		$ 7,101		7,101
Intangible assets subject to amortization, Accumulated Amortization	(6,717)		(6,717)		(6,567)
Intangible assets subject to amortization, Net Book Value	384		$ 384		534
Trademarks
Intangible Assets
Weighted Average Life			8 years 8 months 12 days
Intangible assets subject to amortization, Gross Book Value	3,330		$ 3,330		3,330
Intangible assets subject to amortization, Accumulated Amortization	(2,337)		(2,337)		(2,045)
Intangible assets subject to amortization, Net Book Value	$ 993		$ 993		$ 1,285

Goodwill and Other Intangible_4

Goodwill and Other Intangible Assets - Future Aggregate Amortization Expense (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Estimated future aggregate amortization expense
2022 (excluding the nine months ended September 30, 2022)	$ 966
2023	3,867
2024	3,630
2025	3,440
2026	2,471
Thereafter	4,580
Intangible assets subject to amortization, Net Book Value	$ 18,954	$ 21,854

Fair Value of Financial Instr_3

Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021	Mar. 15, 2021
Senior Notes
Liabilities:
Carrying amount	$ 290,000	$ 310,000	$ 310,000
ABL Revolver
Liabilities:
Carrying amount	25,000
Level 2 \| Senior Notes
Liabilities:
Long-term debt	279,125
Level 2 \| ABL Revolver
Liabilities:
Long-term debt	25,000
Senior Credit Facility
Liabilities:
Carrying amount		310,000
Senior Credit Facility \| Level 2
Liabilities:
Long-term debt		327,050
Estimate of Fair Value \| Senior Notes
Liabilities:
Long-term debt	279,125
Estimate of Fair Value \| ABL Revolver
Liabilities:
Long-term debt	$ 25,000
Estimate of Fair Value \| Senior Credit Facility
Liabilities:
Long-term debt		$ 327,050

Accrued Expenses (Details)

Accrued Expenses (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Accrued Expenses.
Accrued payroll and related employee expenses	$ 8,697	$ 7,558
Accrued employee performance bonuses	6,975	6,900
Employer payroll taxes, including social security deferral	2,277	1,910
Accrued rebates	2,040	1,423
Estimated sales tax liability	762	1,019
Accrued interest	1,105	7,955
Current operating and financing lease liabilities	5,445	4,114
Other	7,083	6,271
Total accrued expenses	$ 34,384	$ 37,150

Financing and Operating Lease_2

Financing and Operating Leases - Components of Operating and Finance Lease Expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Operating lease costs:
Operating lease costs	$ 783	$ 538	$ 2,282	$ 1,580
Variable lease costs	184	181	470	509
Short-term operating lease costs		122		416
Total expense from operating leases	967	841	2,752	2,505
Finance lease costs:
Right-of-use amortization expense	449	256	1,233	751
Interest on lease liabilities	116	92	334	297
Total financing lease cost	$ 565	$ 348	$ 1,567	$ 1,048

Financing and Operating Lease_3

Financing and Operating Leases - Operating and Financing Leases (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Leases
Operating lease right-of-use assets, net of amortization	$ 11,341	$ 12,069
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List]	Property, Plant, Equipment and Operating Lease Right-of-Use Asset	Property, Plant, Equipment and Operating Lease Right-of-Use Asset
Current operating lease liabilities	$ 2,304	$ 1,857
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List]	Accrued Liabilities, Current	Accrued Liabilities, Current
Non-current operating lease liabilities	$ 9,514	$ 10,703
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List]	Other Liabilities, Noncurrent	Other Liabilities, Noncurrent
Total operating lease liabilities	$ 11,818	$ 12,560
Property, equipment and leasehold improvements	98,167	97,119
Accumulated depreciation	(52,240)	(61,937)
Total property, equipment and leasehold improvements, net	57,268	47,251
Current financing lease liabilities	$ 3,141	$ 2,257
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List]	Accrued Liabilities, Current	Accrued Liabilities, Current
Non-current financing lease liabilities	$ 7,110	$ 2,668
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List]	Other Liabilities, Noncurrent	Other Liabilities, Noncurrent
Total financing lease liabilities	$ 10,251	$ 4,925
Financing leases
Leases
Property, equipment and leasehold improvements	14,375	9,088
Accumulated depreciation	(2,644)	(2,451)
Total property, equipment and leasehold improvements, net	$ 11,731	$ 6,637

Financing and Operating Lease_4

Financing and Operating Leases - Lease Maturity (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Operating Leases
2022 (excluding the nine months ended September 30, 2022)	$ 788
2023	3,164
2024	2,896
2025	2,090
2026	1,958
Thereafter	3,657
Total operating lease payment	14,553
Less imputed interest	(2,735)
Total operating lease liabilities	11,818	$ 12,560
Financing Leases
2022 (excluding the nine months ended September 30, 2022)	1,040
2023	3,626
2024	2,828
2025	2,537
2026	1,175
Thereafter	271
Total financing lease payment	11,477
Less imputed interest	(1,226)
Total financing lease liabilities	$ 10,251	$ 4,925

Long-Term Debt - Long-Term Debt

Long-Term Debt - Long-Term Debt (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021	Mar. 15, 2021
Long-term Debt
Unamortized deferred financing costs	$ (4,909)	$ (6,374)
Total debt	310,091	303,626
Total long-term debt	$ 310,091	303,626
Senior Notes
Long-term Debt
Interest rate (as a percent)	8.625%
Long-term debt	$ 290,000	310,000	$ 310,000
ABL Revolver
Long-term Debt
Interest rate (as a percent)	4.701%
Long-term debt	$ 25,000
Senior Credit Facility
Long-term Debt
Long-term debt		$ 310,000

Long-Term Debt - First Lien Cre

Long-Term Debt - First Lien Credit Facility (Details) $ in Thousands					9 Months Ended
	Apr. 01, 2023	Mar. 11, 2022 USD ($)	Mar. 03, 2022 USD ($)	Mar. 15, 2021 USD ($)	Sep. 30, 2022 USD ($) item	Sep. 30, 2021 USD ($)	Dec. 31, 2021 USD ($)
Long-term Debt
Proceeds from Revolving Credit Facility					$ 35,000	$ 14,750
Loss on debt extinguishment					$ (395)	(5,048)
Senior Notes
Long-term Debt
Interest rate (as a percent)				8.625%	8.625%
Repayment of debt		$ 20,000
Long-term debt				$ 310,000	$ 290,000		$ 310,000
Prepayment of debt					0
Debi issuance cost					4,909
Redemption percentage (as a percent)		103%
ABL Revolver
Long-term Debt
Maximum borrowing capacity			$ 75,000	50,000	75,000
Maximum uncommitted accordion feature amount			$ 25,000	15,000
Long-term debt					25,000
Proceeds from Revolving Credit Facility				15,000
Debi issuance cost					1,670
Available to borrow threshold amount					$ 7,500
Number of consecutive days at or above available to borrow threshold amount \| item					30
Minimum fixed coverage ratio (as a percent)					100
Unused commitment fee expense					$ 179	118
ABL Revolver \| Minimum
Long-term Debt
Unused commitment fee (as a percent)	0.375%
ABL Revolver \| Maximum
Long-term Debt
Unused commitment fee (as a percent)	0.50%		0.50%
ABL Revolver \| SOFR \| Minimum
Long-term Debt
Applicable margin over reference rate (as a percent)	1.25%		0.10%
ABL Revolver \| SOFR \| Maximum
Long-term Debt
Applicable margin over reference rate (as a percent)	1.75%		0.30%
Senior Credit Facility
Long-term Debt
Long-term debt							$ 310,000
Early termination penalty				$ 2,635
Loss on debt extinguishment						$ 5,048
Senior Credit Facility \| Minimum
Long-term Debt
Unused commitment fee (as a percent)	1.50%
Senior Credit Facility \| Maximum
Long-term Debt
Unused commitment fee (as a percent)	1.75%

Income Taxes - Effective Income

Income Taxes - Effective Income Tax Rate Reconciliation (Details)	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Effective Income Tax Rate Reconciliation
Tax at federal statutory rate (as a percent)			21%	21%
State taxes, net (as a percent)			5.50%	6.20%
Permanent items (as a percent)			1.30%	2.80%
Other (as a percent)			0.70%	0.70%
Effective income tax rate (as a percent)	25.80%	30.30%	28.50%	30.70%

Stockholders' Deficit (Details)

Stockholders' Deficit (Details)	Sep. 30, 2022 item $ / shares	Dec. 31, 2021 $ / shares
Stockholders' Deficit
Common shares, par value (in dollars per share) \| $ / shares	$ 0.001	$ 0.001
Common Stock
Class of Stock
Voting rights per share \| item	1

Earnings per Share (Details)

Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Numerator:
Net income	$ 11,910	$ 6,626	$ 24,063	$ 15,268
Denominator:
Basic weighted-average common shares outstanding (in shares)	11,265,767	11,238,678	11,259,655	11,234,054
Dilutive shares	523,154	560,643	471,013	521,327
Diluted weighted-average shares outstanding (in shares)	11,788,921	11,799,321	11,730,668	11,755,381
Basic earnings per share: (in dollar per share)	$ 1.06	$ 0.59	$ 2.14	$ 1.36
Diluted earnings per share: (in dollar per share)	$ 1.01	$ 0.56	$ 2.05	$ 1.30

Commitments and Contingencies -

Commitments and Contingencies - Contingencies (Details)	9 Months Ended
Commitments and Contingencies - Contingencies (Details)	Sep. 30, 2022 USD ($)	Sep. 30, 2021 USD ($)	Dec. 31, 2021 USD ($)	Apr. 20, 2021 item
Commitments and Contingencies
Sales tax expense reversed	$ (74,000)	$ 465,000
Estimated sales tax liability	762,000		$ 1,019,000
Pending Litigation
Commitments and Contingencies
Estimated sales tax liability	762,000		$ 1,019,000
Smart Packaging Solutions SA v. CPI Card Group, Inc. \| Pending Litigation
Commitments and Contingencies
The number of patents involved in lawsuit \| item				4
Number of IPR patents involved in lawsuits \| item				3
Loss contingency accrual	$ 0

Stock Based Compensation - Omni

Stock Based Compensation - Omnibus Incentive Plan (Details) - Omnibus Plan - Stock Options - $ / shares		9 Months Ended		12 Months Ended
	May 27, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Stock based compensation
Number of additional shares authorized	1,000,000
Number of shares available for grant	2,200,000	879,197
Stock options granted (in shares)		44,905	115,659
Number of shares
Balance at beginning of year (in shares)		778,835
Granted (in shares)		44,905	115,659
Exercised (in shares)		(18,186)
Expired (in shares)		(1,320)
Forfeited (in shares)		(10,457)
Balance at end of year (in shares)		793,777		778,835
Options: Options vested and exercisable		684,927
Options: Options vested and expected to vest		793,777
Weighted-Average Exercise Price
Balance at beginning of year (in dollars per share)		$ 18.02
Granted (in dollars per share)		14.95
Exercised (in dollars per share)		4.31
Expired (in dollars per share)		21.75
Forfeited (in dollars per share)		28.03
Balance at end of year (in dollars per share)		18.02		$ 18.02
Weighted-Average Exercise Price: Options vested and exercisable		17.12
Weighted-Average Exercise Price: Options vested and expected to vest		$ 18.02
Weighted- Average Remaining Contractual Term (in Years)
Balance (in years)		4 years 11 months 1 day		5 years 7 months 2 days
Granted (in years)		6 years 5 months 19 days
Weighted-Average Remaining Contractual Term (in Years): Options vested and exercisable		4 years 8 months 15 days
Weighted-Average Remaining Contractual Term (in Years): Options vested and expected to vest		4 years 11 months 1 day
Number of unvested options scheduled to vest
Non-Vested Options as of beginning of period		127,357
Granted (in shares)		44,905	115,659
Vested (in shares)		(52,955)
Forfeited (in shares)		(10,457)
Non-Vested Options as of end of period		108,850		127,357
Weighted-Average Grant Date Fair Value
Non-Vested, beginning balance		$ 17.42
Granted: Weighted-Average Grant Date Fair Value		8.99
Vested: Weighted-Average Grant Date Fair Value		17.43
Forfeited: Weighted-Average Grant Date Fair Value		16.52
Non-Vested, ending balance		$ 14.03		$ 17.42
Valuation Assumptions:
Expected term in years		4 years 3 months 18 days	4 years 3 months 18 days
Volatility (as a percent)		77.60%	78.60%
Risk-free interest rate		2.90%	0.70%
Dividend yield (as a percent)		0%
Granted: Weighted-Average Grant Date Fair Value		$ 8.99
2022
Number of unvested options scheduled to vest
Non-Vested Options as of end of period		108,850
Valuation Assumptions:
Term of award		P7Y
Vesting period		2 years

Stock Based Compensation - Rest

Stock Based Compensation - Restricted Stock Units (Details) - Omnibus Plan - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Weighted Average Grant Date Fair Value
Unrecognized compensation expense	$ 1,892		$ 1,892
Period over which compensation expense expected to recognize			1 year 1 month 20 days
Restricted stock units
Number of Restricted Stock Units
Units outstanding at the beginning of the period (in shares)			261,982
Granted (in shares)			27,007
Exercised (in shares)			(31,258)
Forfeited (in shares)			(18,247)
Units outstanding at the end of the period (in shares)	239,484		239,484
Weighted Average Grant Date Fair Value
Units outstanding at the beginning of the period (in dollars per shares)			$ 13.19
Granted (in dollars per share)			14.95
Exercised (in dollars per share)			29.62
Forfeited (in dollars per share)			10.89
Units outstanding at the end of the period (in dollars per shares)	$ 11.42		$ 11.42
Weighted-Average Remaining Amortization Period			1 year 3 months 3 days
Vesting period			2 years
Compensation expense	$ 966	$ 116	$ 2,928	$ 214

Segment Reporting - Revenue and

Segment Reporting - Revenue and EBITDA from Continuing Operations (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Segment Reporting
Net Sales	$ 124,577	$ 99,602	$ 349,309	$ 281,913
EBITDA	27,219	20,266	67,024	56,842
Debit and Credit
Segment Reporting
EBITDA	31,675	22,356	85,042	67,078
Prepaid Debit
Segment Reporting
EBITDA	9,638	9,040	22,101	24,719
Other
Segment Reporting
EBITDA	(14,094)	(11,130)	(40,119)	(34,955)
Operating Segments \| Debit and Credit
Segment Reporting
Net Sales	99,512	76,121	285,708	218,798
Operating Segments \| Prepaid Debit
Segment Reporting
Net Sales	25,335	23,498	64,010	63,339
Intersegment eliminations
Segment Reporting
Net Sales	$ (270)	$ (17)	$ (409)	$ (224)

Segment Reporting - Reconciliat

Segment Reporting - Reconciliation of EBITDA to net income (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Reconciliation of total segment EBITDA to income before taxes
Total segment EBITDA	$ 27,219	$ 20,266	$ 67,024	$ 56,842
Interest, net	(7,323)	(7,183)	(22,334)	(23,196)
Income tax expense	(4,149)	(2,887)	(9,609)	(6,769)
Depreciation and amortization	(3,837)	(3,570)	(11,018)	(11,609)
Net income	$ 11,910	$ 6,626	$ 24,063	$ 15,268