CompoSecure, Inc. (CMPO): Business Model Canvas [Dec-2025 Updated]

You're looking to dissect how CompoSecure, Inc. is actually making money in this shifting landscape, and honestly, it's a fascinating two-pronged play: the steady, high-end metal card business-guiding for about $463 million in Non-GAAP Net Sales for 2025-and their aggressive push into digital asset security with Arculus. As an analyst who's seen a few market cycles, what stands out is their ability to blend premium physical products, like those ESG-friendly metal cards for Tier 1 banks, with cutting-edge cold storage crypto tech, all while maintaining a solid balance sheet with $75.3 million in net cash as of Q3 2025. To really see how these two engines-traditional finance and decentralized assets-fit together in their operations, resources, and revenue streams, you need to check out the full Business Model Canvas breakdown below.

CompoSecure, Inc. (CMPO) - Canvas Business Model: Key Partnerships

You're looking at the core relationships that fuel CompoSecure, Inc.'s dual business: premium metal cards and the Arculus digital asset ecosystem. These partnerships are where the rubber meets the road, translating innovation into revenue.

The traditional finance side remains heavily reliant on a few massive players. CompoSecure, Inc. holds over 80% of the market share in the premium metal card segment. This concentration means partner health directly impacts the top line. For the year 2023, revenue from the two largest customers, American Express and JPMorgan Chase, totaled US$275.7 million (70.5% of the US$390.6 million in total revenue for that year).

Here's a breakdown of the key relationships in the traditional card space, which drove a 13% year-over-year increase in third-quarter 2025 revenue.

The digital asset expansion, centered around the Arculus product line, relies on strategic alliances with major crypto platforms and infrastructure providers. These fintech partnerships are crucial for driving adoption beyond the traditional banking base. You saw exciting customer launches in the second quarter of 2025, including programs with these key names.

• Coinbase: CompoSecure, Inc. announced the new Coinbase One Card, which is the first crypto card operating on the American Express network.
• Crypto.com: CompoSecure, Inc. manufactures the card for the Crypto.com Visa Card, which was noted as the world's largest crypto card program.
• Gemini: CompoSecure, Inc. manufactures the metal crypto rewards credit card for Gemini, which allows cardholders to earn up to 3% back in Bitcoin or over 40 cryptocurrencies.

The Arculus ecosystem is specifically designed to bridge self-custody security with real-world utility, which requires integration with cash-access points and trading platforms. This is where the infrastructure partnerships really shine.

The integration with MoneyGram Access, announced in April 2025, positions CompoSecure, Inc. as the first hardware wallet to offer global cash-in/cash-out functionality for USDC on the Stellar blockchain. This leverages MoneyGram's massive footprint:

• Geographic Reach: Cash in/out is available in over 200 countries and territories.
• Retail Locations: Access is provided through more than 440,000 participating retail locations globally.
• MoneyGram Scale: The partner processes over $200 billion USD annually.

Also, in September 2025, Arculus partnered with N.exchange, a non-custodial exchange, to launch a swap request Smart Order Router within the Arculus Cold Storage App. This directly enhances the trading utility for self-custody users.

While specific 2025 user adoption or transaction volume numbers for the digital asset platforms like MetaMask or Baanx aren't public, the overall Arculus segment generated another net positive quarter in Q2 2025. The company received a grant from the Stellar Development Foundation to enable payments over traditional card rails directly from self-custody wallets via smart contracts.

Finance: draft 13-week cash view by Friday.

CompoSecure, Inc. (CMPO) - Canvas Business Model: Key Activities

CompoSecure, Inc.'s key activities center on high-value manufacturing, proprietary software deployment, and expanding its digital security footprint, all supported by strong client engagement.

High-security metal payment card design and manufacturing

This activity underpins the core business, capitalizing on a market segment expected to reach just over 90 million cards issued by 2025, up from under 30 million in 2021. Metal payment cards still represent less than 1% of total payment card shipments annually. The company's manufacturing scale is evident in its financial results; for the third quarter of 2025, Non-GAAP net sales reached $120.9 million. For the full year 2025, CompoSecure, Inc. is projecting Non-GAAP Net Sales of approximately $455 million.

Implementing the CompoSecure Operating System (COS) for efficiency

The systematic deployment of the CompoSecure Operating System (COS) is a key activity driving operational improvements and margin expansion. This is reflected in profitability metrics across 2025 reporting periods. For instance, the Gross Margin in Q3 2025 expanded significantly to 59.0%. In the second quarter of 2025, the Non-GAAP Gross Margin reached 57.5% of net sales, up from 51.6% in the prior year period. Pro Forma Adjusted EBITDA for Q3 2025 was $47.7 million, a 30% year-over-year increase. The full-year 2025 guidance projects Pro Forma Adjusted EBITDA of approximately $158 million.

Continuous development of the Arculus digital asset security platform

Developing and scaling the Arculus platform is a strategic key activity moving CompoSecure, Inc. beyond physical cards. A significant milestone was achieved when the Arculus digital authentication business generated a net positive contribution for the first time in the first quarter of 2025. The platform continues to evolve, with its technology powering new products like the Coinbase One Card.

Managing key client relationships with global financial institutions

Maintaining and expanding relationships with top-tier issuers is critical, evidenced by specific volume and program activity. CompoSecure, Inc. shipped approximately 3.4 million cards to American Express alone in one quarter. The company supports numerous high-profile programs, including updates to the Chase Sapphire Reserve Consumer and Business cards.

Key client program activity in 2025 included:

• New and expanding programs with Chase Sapphire Reserve.
• Supporting Crypto.com and Gemini card programs.
• Launching the Coinbase One Card on the American Express network.
• Working with clients like JPMorgan Chase and Robinhood.

Securing and maintaining payment network certifications

The ability to integrate the Arculus technology into payment networks is a necessary activity for product rollout. The launch of the Coinbase One Card, which is powered by Arculus, is specifically noted as being on the American Express network. The Arculus platform also supports direct onchain tap-to-pay capability, integrating with existing POS systems.

A comparison of quarterly sales performance highlights the importance of domestic client activity:

CompoSecure, Inc. (CMPO) - Canvas Business Model: Key Resources

You're looking at the core assets CompoSecure, Inc. (CMPO) relies on to execute its strategy as of late 2025. These aren't just things they own; they are the competitive moat, especially given the recent corporate restructuring and the pending Husky Technologies combination.

Proprietary metal card manufacturing technology and patents

The foundation of CompoSecure, Inc.'s premium offering is its intellectual property around metal card construction. This technology is what lets them embed electronics without compromising the metal structure or signal integrity.

• Patents secured cover innovative dual-interface metal card technology.
• The metal structure itself can act as an antenna or amplifier for the EMV chip.
• As of January 2023, the company held more than 55 U.S. and foreign patents issued.
• Approximately 30 U.S. and foreign patent applications were pending as of that same date.

This IP is critical because metal cards represent less than 1% of total payment card shipments annually, giving CompoSecure, Inc. a specialized, defensible position in the premium upgrade cycle.

Arculus hardware and software intellectual property (IP)

The Arculus platform represents a significant expansion beyond just metal cards, moving into the digital asset and authentication space. This IP is key for future growth vectors.

• Arculus technology allows a metal card to function as a 'tap-to-authenticate' hardware key.
• It supports passwordless and hardware-based multi-factor authentication (MFA).
• The platform includes hardware passkey authenticators and secure payment solutions.
• For Q3 2025, Arculus delivered 'another net positive quarter.'

This capability directly addresses the need for enhanced security in digital transactions.

Highly efficient manufacturing facilities and supply chain

Operational excellence is a stated focus, driven by the CompoSecure Operating System (COS), which you can see reflected directly in the margin expansion.

Here's a quick look at the tangible results of that operational focus through the third quarter of 2025:

The systematic deployment of COS is clearly driving these improvements, establishing a more durable margin profile.

Strong balance sheet with net cash of $75.3 million as of Q3 2025

Liquidity is a major asset, providing flexibility for operations and strategic moves, like the announced Husky combination. You need to look at the Non-GAAP figures for the clearest picture of the standalone operating entity's cash position as of September 30, 2025.

The balance sheet strength is demonstrated by the net cash position:

• Cash and Short-Term Investments (Non-GAAP): $265.3 million
• Total Debt (Non-GAAP): $190.0 million
• Resulting Net Cash Position: $75.3 million

This is a significant swing from a net debt position of $277.3 million at September 30, 2024. That's a major de-risking move.

Long-term, sticky contracts with top-tier financial clients

The revenue base is anchored by relationships with major players in both traditional finance and the emerging fintech space. These contracts represent recurring revenue streams that are hard to displace once integrated.

Recent wins highlight the breadth of CompoSecure, Inc.'s client base:

• Programs launched or expanded with Citi Strata Elite.
• Partnerships with major fintechs like Chime.
• Work with established institutions such as Itau and Bank of America (Alaska Airlines).
• Security solutions provided for platforms like Gemini XRP (using Arculus).

This client roster provides the demand underpinning the raised full-year 2025 Non-GAAP Net Sales guidance of approximately $463 million.

Finance: review the cash flow projections for Q4 2025 against the current debt covenants by next Tuesday.

CompoSecure, Inc. (CMPO) - Canvas Business Model: Value Propositions

You're looking at the core reasons why issuers and crypto users choose CompoSecure, Inc. (CMPO) products right now, late in 2025. It's about premium feel meeting cutting-edge digital asset security.

Premium, high-security metal cards that enhance brand perception

The value here is clear: issuers get a significant brand lift for a small investment. Metal cards represent only about 0.5% of total program costs for issuers, yet they drive tangible results in customer behavior. We see that these premium cards can increase customer spend by approximately 5% and boost customer acquisition and retention with a demand increase of over 10%+. The operational success supporting this is evident in the Q3 2025 Gross Margin, which expanded to 59.0%.

Key program wins reinforcing this value proposition include new or expanded programs with Citi Strata Elite, Chime, Bank of America/American Airlines, Alaska Airlines, BMO, and Gemini XRP.

Arculus cold storage wallet with a three-factor authentication security model

The Arculus cold storage wallet is built on a security model that combines three distinct factors, ensuring private keys never leave the hardware. This air-gapped protection is designed to keep hackers out while allowing authenticated users in via familiar actions.

• Something You Are: Biometric security like Face ID or a fingerprint.
• Something You Know: A custom 6-digit PIN code.
• Something You Have: The physical Arculus Card containing the secure element.

The card itself features a CC EAL6+ Secure Element to generate and store encrypted private keys. If the PIN is entered incorrectly 3 times, the card resets, wiping the keys for protection against brute force attacks.

Direct onchain tap-to-pay capability for digital assets via Arculus

This capability bridges the crypto economy to real-world commerce by allowing users to spend digital assets seamlessly at traditional Point-of-Sale (POS) merchant terminals. The solution supports multifunctional capabilities on a single chip, enabling tap-to-pay transactions across both blockchain networks and traditional payment rails using the same physical card. This means merchants can accept crypto payments instantly through their existing contactless infrastructure, potentially lowering transaction costs and settlement times compared to legacy networks.

ESG-friendly cards using 65% post-consumer recycled stainless steel

CompoSecure, Inc. provides sustainability advantages over plastic cards through durability and material sourcing. Most metal card products contain about 65% post-consumer recycled stainless steel. Furthermore, ceramic metal hybrid and metal veneer cards received ICMA (International Card Manufacturers Association) Ecolabel Standard certification.

Full crypto trading platform access directly from cold storage

The Arculus cold wallet is evolving from just a security product into a full trading platform. This is achieved through integration with N. Exchange and the launch of a Smart Order Router. This setup lets users trade crypto directly from their self-custody wallets, offering a stronger edge by sitting at the intersection of self-custody and liquidity access. Users now have access to hundreds of new trading pairs for swaps executed at highly competitive rates. The average transaction volume conducted via cold wallets rose to approximately $5,300 in 2025, up 14% year-over-year, showing increased activity in this secure environment.

Finance: draft 13-week cash view by Friday.

CompoSecure, Inc. (CMPO) - Canvas Business Model: Customer Relationships

You're looking at how CompoSecure, Inc. manages its relationships across its two main customer bases: the large financial institutions issuing metal cards and the direct/platform partners for Arculus. The strategy here is high-touch service for the big contracts and platform integration for the digital asset side. Honestly, the numbers from Q3 2025 show this approach is driving significant financial results, especially on the domestic front.

Dedicated, high-touch account management for large financial institutions

For the core metal card business, the relationship is deep and consultative. This isn't just transactional; it's about embedding CompoSecure, Inc. into the client's premium card strategy. The success of this approach is visible in the top-line growth from these established partners. For the third quarter ended September 30, 2025, non-GAAP Net Sales grew 13% year-over-year to $120.9 million. Digging into that, domestic net sales, which heavily reflect these large issuer relationships, jumped 31% to $105.1 million. This suggests the high-touch service is translating directly into more volume and new program adoption, like the recent wins with Citi Strata Elite, Chime, and Gemini XRP in Q3.

Long-term, recurring revenue contracts for card programs

While the exact contract lengths aren't public, the guidance CompoSecure, Inc. provides implies a strong base of recurring revenue. They are reiterating full-year 2025 guidance for non-GAAP Net Sales around $463 million and projecting ~$510 million for fiscal year 2026. This forward visibility suggests contracts are structured to provide a stable revenue base, which is further supported by the gross margin expansion. The non-GAAP gross margin hit 59.0% in Q3 2025, up significantly from 51.7% in Q3 2024, showing operational efficiencies are flowing through to the bottom line from this established business. It's a classic example of sticky, high-value recurring business.

The market validation for premium metal cards, which underpins these relationships, is strong:

• 68% of cardholders would select a bank card program over another if it offered a metal payment card.
• 66% of ultra-high-net-worth respondents would use metal payment cards more than other cards in their wallet.
• 69% of successful young individuals would stay with a bank offering a metal payment card.

Direct-to-consumer sales and support for the Arculus cold wallet

The Arculus line has a different relationship model, blending direct sales with enterprise partnerships. The key relationship milestone here is that Arculus generated another net positive contribution in Q1 2025. This means the direct-to-consumer and platform-driven sales are covering their own costs and contributing profit, which is a big deal for a newer product line. The focus is on positioning Arculus as a secure multifunction platform for digital authentication and asset protection.

Collaborative design process for custom metal card aesthetics

The aesthetic appeal of the metal card is a core value proposition, requiring close collaboration with the issuer's branding teams. This process is what drives the high adoption intent seen in the surveys. The success in Q3 was fueled by strong domestic demand and new program wins, which means the design and integration teams are working effectively with new clients like Bank of America (Alaska Airlines) and BMO. The focus on operational excellence via the CompoSecure Operating System is helping CompoSecure, Inc. deliver these custom products with better margins, as evidenced by the Q3 gross margin of 59.0%.

Enterprise-level integration support for Arculus platform partners

For the Arculus platform, the relationship is built on deep technical integration with digital asset and Web3 players. This is where you see the real innovation in customer relationships. For example, the integration with MoneyGram for global Cash In/Cash Out via Stellar was announced in April 2025. Furthermore, the MetaMask metal payment card, a self-custody crypto card with direct payments, was unveiled in April 2025, showing a strong partnership with a leading self-custody wallet provider. These platform wins are key to the recurring revenue story for the Arculus segment.

Here's a quick look at how the customer demand translated into the latest reported financial performance metrics as of September 30, 2025:

Finance: draft 13-week cash view by Friday.

CompoSecure, Inc. (CMPO) - Canvas Business Model: Channels

You're looking at how CompoSecure, Inc. gets its premium payment products and Arculus solutions into the hands of customers as of late 2025. The channels are clearly segmented between high-touch enterprise sales and the growing digital/D2C route for Arculus.

The direct sales force targets large financial institutions and fintechs globally, which is where the bulk of the revenue comes from. For instance, Q3 2025 Non-GAAP Net Sales hit $120.9 million, up 13% year-over-year, driven by 'new program wins across both traditional banks and fintechs.'

The global reach is evident in the sales breakdown, though domestic strength is currently outpacing international growth in some periods. Here's a look at the sales performance that reflects channel effectiveness:

Partnerships with card processors and personalization bureaus are critical for fulfillment, but the primary channel focus is securing the issuer relationship. CompoSecure, Inc. continues to expand its client base, which includes major names like Citibank/American Airlines, Robinhood Gold, WealthSimple, and Scotia Bank. The company is still the 'far and away the leader in metal cards globally,' though this premium segment represents less than 1% penetration of the total payment card market, suggesting significant channel expansion potential.

The e-commerce platform for direct-to-consumer Arculus sales is proving its viability as a separate revenue stream. The Arculus digital authentication business achieved a significant milestone by delivering a net positive contribution in Q1 2025, and this momentum continued with another net positive quarter reported in Q2 2025 and Q3 2025. This validates the direct-to-consumer and digital-first channel strategy for that product line.

Strategic co-marketing with crypto partners is a key driver for Arculus adoption. Specific partnerships mentioned include MetaMask and the launch of the Coinbase One Card on the American Express network, which highlights the channel for secure digital finance solutions.

Industry conferences and trade shows are used to drive awareness and secure those large direct sales wins. While specific attendance numbers for events like the Stablecoin Conference LATAM 2025 aren't public, the success in securing major program refreshes and new wins suggests active engagement in industry forums. For example, the company noted 'strong activity around premium upgrade cycles and card program refreshes' in Q2 2025.

• Metal card demand is high: 73% of global respondents would pay extra for a metal payment card.
• Ultra-high-net-worth (UHNW) interest is strong: 96% of UHNW individuals globally would pay extra for a metal card.
• Metal cards are seen as prestigious by 67% of cardholders.

Finance: finalize the Q3 2025 channel-specific revenue attribution model by next Tuesday.

CompoSecure, Inc. (CMPO) - Canvas Business Model: Customer Segments

You're looking at the customer base for CompoSecure, Inc. (CMPO) as of late 2025, and it's clear the business is focused on high-value financial and digital asset players. The company explicitly calls out 'robust domestic demand and growth across both traditional banks and fintechs' as drivers for their Q2 2025 performance. This segment is the engine for their core payment card business.

The customer segments CompoSecure, Inc. serves are diverse, spanning established finance to emerging digital asset infrastructure. The company's strategy seems to be winning major programs that drive volume and then leveraging those wins to expand its security and authentication offerings, especially through the Arculus brand.

Here's a breakdown of the specific groups CompoSecure, Inc. targets:

• Global Tier 1 traditional banks (e.g., JPMorgan Chase, evidenced by partnerships like Chase Sapphire Reserve)
• High-growth domestic and international Fintech companies
• Crypto exchanges and digital asset platforms (e.g., Coinbase, Crypto.com, Gemini)
• Affluent and High-Net-Worth Individuals (HNWIs) who prefer premium cards
• Retail consumers purchasing the Arculus cold storage wallet

The momentum in the traditional banking and fintech space is significant. For the second quarter of 2025, Domestic Net Sales surged by 22% year-over-year, reaching $104.3 million out of total Non-GAAP Net Sales of $119.6 million for that quarter. This domestic strength is where the traditional banks and leading fintechs are clearly concentrated. Still, international sales showed a notable reversal in Q2 2025, declining 35% to $15.3 million, following a 28% jump in Q1 2025.

For the crypto and digital asset segment, the Arculus platform is gaining traction, securing vertical wins with partners like MetaMask and MoneyGram, in addition to launching the Coinbase One Card on the American Express network. The metal card market itself, which serves the premium card and HNWIs segment, is noted as having a penetration rate of less than 1%, suggesting a massive runway for growth in premium payment products.

The overall financial context for these customer segments in mid-2025 is one of accelerating revenue and margin improvement, which supports the investment in these customer acquisition efforts. Here's a quick look at the Q2 2025 Non-GAAP performance:

The focus on the Arculus brand also directly addresses the retail consumer and HNWIs looking for secure, hardware-based digital asset protection. The company reported that Arculus generated 'another net positive quarter' in Q2 2025, indicating that the consumer-facing security product is contributing positively to the bottom line, separate from the high-volume card manufacturing business.

CompoSecure, Inc. (CMPO) - Canvas Business Model: Cost Structure

You're looking at the expenses CompoSecure, Inc. incurs to keep the lights on and those metal cards moving. Honestly, the cost structure is heavily weighted toward the physical product and the technology that makes it unique.

High cost of goods sold (COGS) due to specialized metal and components

The core of the cost structure is tied directly to making those premium metal payment cards. This means raw material costs for specialized metals and the complex components required for secure, durable products are significant drivers of COGS. For the second quarter ended June 30, 2025, Non-GAAP Net Sales were \$119.6 million, and the resulting Non-GAAP Gross Profit was \$68.8 million, implying a Cost of Sales (COGS) of approximately \$50.8 million for that quarter alone.

The gross margin expansion to 57.5% in Q2 2025, up from 51.6% in Q2 2024, shows the CompoSecure Operating System (COS) is helping efficiency, but the underlying material cost remains a high fixed component of the cost base.

Significant investment in Research and Development (R&D) for Arculus technology

While specific R&D dollar amounts for the full year 2025 aren't isolated in the latest reports, the strategic focus on Arculus technology is a clear cost area. CompoSecure, Inc. views Arculus as a powerful differentiator in the digital asset and Web3 payments space, expecting a net positive contribution for the full year 2025. The company is making foundational investments to support long-term growth plans, which includes technology development.

Manufacturing and operational expenses, including the COS implementation

Manufacturing costs are embedded within COGS, but the operational expenses related to implementing the CompoSecure Operating System (COS) are a current focus area impacting profitability metrics. The company noted that higher general and administrative expenses reflected strategic investments in organic growth and the implementation of COS to drive operational efficiencies. The goal of COS is to deliver positive net impact, particularly at the factory and production level, throughout 2025.

Sales, General, and Administrative (SG&A) costs, including Resolute Holdings management fee

SG&A expenses are a notable part of the operating cost structure. For the second quarter of 2025, Selling, general and administrative expenses were reported as \$30,438 thousand, or approximately \$30.44 million. This figure includes the management fee paid to Resolute Holdings Management, Inc. The Management Agreement dictates a quarterly cash fee equal to 2.5% of CompoSecure Holdings' last 12 months' Adjusted EBITDA, though the fee is waived if Adjusted EBITDA is zero or negative. The actual payment in Q1 2025 was \$1.1 million as the agreement became effective on February 28, 2025. Full-year 2025 guidance includes the payment of this fee.

Here's a look at the key expense components and related metrics for the 2025 period based on available data:

Capital expenditures for production equipment and capacity expansion

CompoSecure, Inc. is undertaking ongoing foundational investments to support its growth strategy, which covers capacity expansion and production equipment. The company has reiterated its 2025 guidance, which reflects these foundational investments alongside commercial momentum. Specific capital expenditure dollar amounts for the full year 2025 are not explicitly detailed as a line item in the latest public statements, but the commitment to these investments is factored into the overall financial outlook.

CompoSecure, Inc. (CMPO) - Canvas Business Model: Revenue Streams

You're looking at the core ways CompoSecure, Inc. brings in money as of late 2025. It's a mix of established hardware sales and growing security/authentication services.

Metal payment card sales to financial institutions remain the primary revenue driver, capitalizing on the fact that metal cards represent less than 1% penetration of the total payment card market. The momentum here is clear, with Q3 2025 Non-GAAP Net Sales reaching $120.9 million, marking a 13% increase compared to Q3 2024's $107.1 million. Domestic demand is particularly strong, showing a 22% growth to $104.3 million in Q2 2025 alone.

The company has updated its expectations for the year based on this performance:

• Full-year 2025 Non-GAAP Net Sales guidance of approximately $463 million.
• Full-year 2025 Pro Forma Adjusted EBITDA guidance of approximately $165 million to $170 million.

Here's a quick look at the most recent reported quarterly sales figures:

Revenue from sales of the Arculus cold storage hardware wallet and related security solutions is a growing component. The Arculus digital authentication business achieved a net positive contribution for the first time in Q1 2025. This segment is supported by significant commercial momentum, such as the launch of the Coinbase One Card on the American Express network.

The overall revenue structure is supported by these distinct streams:

• Metal payment card manufacturing and fulfillment.
• Sales of the Arculus cold storage hardware wallet.
• Potential transaction-based revenue from the Arculus trading platform, tied to the use of the wallet for digital asset access.
• Licensing and service fees for Arculus security and authentication solutions integrated into financial products.

To be fair, the growth outlook hinges on accelerating this double-digit revenue growth and turning Arculus into a consistent recurring revenue driver.