ATLANTA--(BUSINESS WIRE)--Repay Holdings Corporation (NASDAQ: RPAY) ("REPAY†), a leading provider of vertically-integrated payment solutions, today announced a new integration with Yooz, the leading provider of financial automation solutions empowering Lean Financial Operationsâ"¢. This collaboration further emphasizes REPAY's commitment to enabling organizations to reduce accounting errors and the risk of delinquent or inaccurate payments while creating more trusting and meaningful relationships. ...

Repay Holdings Corporation (NASDAQ:RPAY) is one of the most undervalued technology stocks to buy according to analysts. On September 30, Repay announced a new integration with Fuse, which is a next-generation loan origination system/LOS. Te integration enhances Fuse’s AI-powered lending software by providing REPAY’s digital payment technology to banks, credit unions, and other financial institutions. The expanded automation capabilities are designed to help lenders more efficiently manage consumer and aut ...

Core Insights - Repay Holdings Corporation (NASDAQ: RPAY) has been recognized as the most reliable gateway provider by TSG (The Strawhecker Group) based on key performance metrics [1] - The recognition is based on mid-year data from TSG's Global Experience Monitoring (GEM) platform, which evaluates real card transactions [1] Performance Metrics - REPAY's gateway achieved the highest authorization rate among competitors [1] - The company also recorded the lowest gateway minute outage, indicating superior reliability in its payment solutions [1]

Core Points - Repay Holdings Corporation announced the appointment of Robert S. Houser as Chief Financial Officer [1] - The company will grant Mr. Houser restricted stock valued at $700,000 as an inducement for his employment [1] - The award was approved by the Compensation Committee [1]

Core Viewpoint - Repay Holdings (RPAY) is showing a significantly improving earnings outlook, making it an attractive option for investors as analysts continue to raise their earnings estimates for the company [1][2]. Earnings Estimate Revisions - Analysts' optimism regarding Repay Holdings' earnings prospects is leading to higher estimates, which is expected to positively impact the stock price [2]. - The Zacks Rank system indicates a strong correlation between earnings estimate revisions and stock price movements, with Zacks 1 Ranked stocks averaging a +25% annual return since 2008 [3]. - The current-quarter earnings estimate is $0.20 per share, reflecting a -13.0% change from the previous year, but has increased by 13.79% over the last 30 days with no negative revisions [6]. - For the full year, the earnings estimate is $0.85 per share, showing a -7.6% change from the prior year, with a 5% increase in the consensus estimate over the past month [7][8]. Zacks Rank and Investment Potential - Repay Holdings has achieved a Zacks Rank 2 (Buy) due to favorable estimate revisions, indicating strong potential for outperformance compared to the S&P 500 [9]. - The stock has risen 7.3% over the past four weeks, suggesting that further upside may still be possible, making it a candidate for portfolio addition [10].

Summary of Repay (RPAY) FY Conference Call - August 13, 2025 Company Overview - Repay is an integrated payment technology company that provides payment processing solutions for both consumer and B2B payments, with a focus on embedding technology into various software platforms [1][4] - The company has approximately 286 software integrations, with 80% of its business related to consumer bill pay and 20% to business payments [5][6] Key Financial Highlights - Q2 results showed solid progress with sequential growth, returning to high single-digit to low double-digit growth rates [2][35] - Revenue increased, with normalized gross profit margins at 42% on an EBITDA basis [36][39] - Free cash flow was reported at 71%, with a goal to maintain over 60% as the year progresses [36] - The company ended the quarter with over $160 million in cash and has repurchased $38 million in stock year-to-date [39][41] Strategic Focus and Market Position - Repay is focusing on the accounts payable (AP) side of the business, which is seen as a significant growth opportunity [11][12] - The company has a vendor network of approximately 440,000, which is expected to drive synergies and growth [12][16] - A strategic review was conducted to optimize the go-to-market strategy, including enhancing the sales force and client engagement activities [20][25] Competitive Advantages - Repay owns its own clearing and settlement engine, providing a cost advantage over competitors who rely on third-party processors [27][29] - The company is positioned to benefit from market consolidation, which may disrupt competitors and create new opportunities [30] Growth Opportunities - The company is investing in enterprise sales and has seen positive bookings, particularly in the automotive and healthcare sectors [56][57] - Emerging markets, such as mortgage payments, are being targeted for growth, with potential partnerships with card networks to facilitate new payment flows [61][62] Future Outlook - Repay aims to return to growth after experiencing client losses in the previous quarter, with expectations of positive sequential growth in Q3 and Q4 [50][54] - The company is considering capital allocation strategies, including potential M&A opportunities, particularly in the B2B space [46][47] Management Changes - A new CFO, Rob Hauser, will join the company, bringing extensive experience in the payment space [49] Additional Insights - The company emphasizes the importance of cost-effective payment solutions to meet consumer demands, particularly in the mortgage payment sector [62][65] - Repay is optimistic about its growth trajectory, supported by a strong balance sheet and ongoing investments in technology and sales [58][66]

Group 1: Earnings Performance - Repay Holdings reported quarterly earnings of $0.20 per share, matching the Zacks Consensus Estimate, but down from $0.22 per share a year ago [1] - The company had a revenue of $75.63 million for the quarter ended June 2025, exceeding the Zacks Consensus Estimate by 1.25% and up from $74.91 million year-over-year [2] - Over the last four quarters, Repay Holdings has not surpassed consensus EPS estimates [1] Group 2: Stock Performance and Outlook - Repay Holdings shares have declined approximately 32.5% year-to-date, contrasting with the S&P 500's gain of 8.6% [3] - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters [4] - The current consensus EPS estimate for the next quarter is $0.20 on revenues of $77.41 million, and for the current fiscal year, it is $0.86 on revenues of $309.31 million [7] Group 3: Industry Context - The Financial Transaction Services industry, to which Repay Holdings belongs, is currently in the top 30% of over 250 Zacks industries, indicating a favorable industry outlook [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Repay Holdings' stock performance [5][6]

Financial Data and Key Metrics Changes - In Q2 2025, revenue was $75.6 million, representing a 1% year-over-year increase [17] - Reported gross profit declined by 2% year-over-year, impacted by approximately five points from client losses and one point from political media contributions [17] - Adjusted EBITDA was $31.8 million, reflecting a 42% adjusted EBITDA margin, with free cash flow of $22.6 million and a 71% free cash flow conversion [19][20] Business Line Data and Key Metrics Changes - Consumer Payments segment showed flat gross profit year-over-year, with improvements expected as client losses are lapped [18] - Business Payments segment reported a 5% year-over-year decline in gross profit, but normalized gross profit increased approximately 1% when excluding political media contributions [18] - The total supplier network grew by 47% year-over-year to over 440,000 suppliers, indicating strong growth in the Business Payments segment [13] Market Data and Key Metrics Changes - The financial institution vertical onboarded 10 new credit union clients, increasing the total credit union client base to 353 [10] - The company is experiencing sustainable bookings growth across its consumer verticals, supported by a healthy sales pipeline with 185 software partners [8] Company Strategy and Development Direction - The core growth strategy focuses on optimizing payment flows and embedding payment technology into software platforms [5] - The company is prioritizing organic growth investments and maintaining a strong balance sheet while preparing for the maturity of convertible notes in 2026 [15][20] - Strategic tuck-in M&A opportunities are being considered to enhance growth potential, particularly in consumer and business payments [15][30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving high single-digit to low double-digit normalized gross profit growth in Q4 2025, driven by sequential improvements [15][25] - The company is focused on reaccelerating growth and enhancing operational excellence as it moves through 2025 and into 2026 [60] Other Important Information - The company repurchased approximately 5% of its outstanding shares, totaling $38 million year-to-date [14][20] - Robert Houser has been appointed as the new Chief Financial Officer, effective September 8 [16] Q&A Session Summary Question: Guidance for the second half of the year - Management expects sequential improvement in growth, with confidence in achieving high single-digit to low double-digit normalized growth in Q4 [25] Question: Capital management priorities regarding convertible notes - The company will prioritize cash allocation towards the convertible notes due in February 2026, while also considering the use of revolver capacity [27] Question: Strategic tuck-in M&A opportunities - Management is open to strategic acquisitions that align with their existing verticals in consumer and business payments [30] Question: Moving upmarket into larger customers - The company is investing in enterprise sales and enhancing its direct sales model to target larger customers within existing verticals [38] Question: Update on mortgage payments market - There is positive traction in the mortgage payments market, but it is not expected to be a significant contributor in 2025 [40] Question: Update on RCS partnership with POS provider - No significant updates, but the relationship is viewed positively with ongoing implementations [43] Question: Mix between AR and AP in the B2B segment - The mix is approximately 60% AR and 40% AP [46] Question: Consumer payments softness - Management noted challenges in the auto segment but sees resilient trends overall, with no significant impacts from tariffs [50]

Financial Performance - Q2 2025 - Revenue increased by 1% year-over-year, from $74.9 million in Q2 2024 to $75.6 million in Q2 2025 [13] - Gross profit decreased by 2% year-over-year, from $58.6 million in Q2 2024 to $57.2 million in Q2 2025 [13] - Adjusted EBITDA decreased by 6% year-over-year, from $33.7 million in Q2 2024 to $31.8 million in Q2 2025 [13] - Free cash flow increased by 17% year-over-year, from $19.3 million in Q2 2024 to $22.6 million in Q2 2025 [13] - Free Cash Flow conversion increased from 57% to 71% [13] Segment Performance - Consumer Payments revenue increased by 2% year-over-year, from $69.3 million in Q2 2024 to $70.5 million in Q2 2025 [18] - Business Payments revenue increased by 9% year-over-year excluding political media, but decreased by 3% as reported [21] Liquidity and Debt - Total liquidity was $413 million as of June 30, 2025 [25, 49] - Net leverage ratio was 2.5x as of June 30, 2025, with net debt of $345 million and LTM Adjusted EBITDA of $137 million [27] Outlook - The company reiterates its previously provided financial outlook and expects sequential quarterly acceleration in normalized growth year-over-year [32]

[PART I – FINANCIAL INFORMATION](index=5&type=section&id=PART%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) [Condensed Consolidated Financial Statements](index=5&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements) The company reported a $108.0 million net loss in Q2 2025, largely due to a $103.8 million goodwill impairment Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Cash and cash equivalents | $162,615 | $189,530 | ($26,915) | | Goodwill | $613,012 | $716,793 | ($103,781) | | Intangible assets, net | $359,827 | $389,034 | ($29,207) | | Total Assets | $1,413,374 | $1,571,908 | ($158,534) | | Total Liabilities | $773,970 | $798,739 | ($24,769) | | Total Equity | $639,404 | $773,169 | ($133,765) | Condensed Consolidated Statements of Operations Highlights (in thousands) | Metric | Q2 2025 | Q2 2024 | Y/Y Change | H1 2025 | H1 2024 | Y/Y Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | $75,626 | $74,906 | +0.9% | $152,951 | $155,626 | -1.7% | | Impairment loss | $103,781 | $0 | N/A | $103,781 | $0 | N/A | | Loss from operations | ($104,904) | ($3,421) | +2878.8% | ($108,524) | ($5,925) | +1731.6% | | Net loss | ($108,032) | ($4,237) | +2449.7% | ($116,200) | ($9,602) | +1110.2% | | Net loss attributable to the Company | ($102,251) | ($4,071) | +2411.7% | ($110,198) | ($9,283) | +1087.1% | | Basic and diluted EPS | ($1.15) | ($0.04) | +2775.0% | ($1.24) | ($0.10) | +1140.0% | Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $35,568 | $55,780 | | Net cash used in investing activities | ($21,002) | ($22,820) | | Net cash used in financing activities | ($42,295) | ($3,069) | [Note 3. Revenue](index=11&type=section&id=Note%203.%20Revenue) Total revenue for Q2 2025 increased slightly to $75.6 million, with Consumer Payments remaining the primary driver Revenue by Segment (in thousands) | Segment | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Consumer Payments | $70,474 | $69,292 | $142,417 | $145,428 | | Business Payments | $10,945 | $10,592 | $21,933 | $20,269 | | Elimination of intersegment | ($5,793) | ($4,978) | ($11,399) | ($10,071) | | **Total Revenue** | **$75,626** | **$74,906** | **$152,951** | **$155,626** | [Note 7. Goodwill](index=17&type=section&id=Note%207.%20Goodwill) A $103.8 million goodwill impairment was recorded, mainly in Consumer Payments, due to stock price and valuation changes - A goodwill impairment loss of **$103.8 million** was recorded in Q2 2025, with **$103.2 million** attributed to the Consumer Payments segment and **$0.6 million** to the Business Payments segment[56](index=56&type=chunk)[58](index=58&type=chunk) - The impairment was triggered by a decline in the company's stock price, leading to a quantitative analysis that confirmed the impairment, with fair value impacted by changes in the discount rate and lower comparable company multiples[56](index=56&type=chunk)[58](index=58&type=chunk) [Note 8. Borrowings](index=19&type=section&id=Note%208.%20Borrowings) Total borrowings reached $498.4 million, including convertible notes, with a $250.0 million undrawn revolving credit facility Borrowings Summary (in thousands) | Debt Instrument | Principal Amount | Carrying Value (June 30, 2025) | Fair Value (June 30, 2025) | | :--- | :--- | :--- | :--- | | 2026 Notes | $220,000 | $219,389 | $210,760 | | 2029 Notes | $287,500 | $280,736 | $235,750 | | Revolving credit facility | $0 | ($1,727) | $0 | | **Total** | **$507,500** | **$498,398** | **$446,510** | - The company entered into a Second Amended and Restated Revolving Credit Agreement for a **$250.0 million** facility maturing in July 2029, with no amounts drawn as of June 30, 2025[59](index=59&type=chunk)[60](index=60&type=chunk) [Note 13. Segments](index=27&type=section&id=Note%2013.%20Segments) Consumer Payments revenue increased 1.7% to $70.5 million, while Business Payments revenue grew 3.8% to $10.9 million in Q2 2025 Segment Performance (in thousands) | Segment | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | :--- | | **Consumer Payments** | Revenue | $70,474 | $69,292 | $142,417 | $145,428 | | | Gross Profit | $55,429 | $55,546 | $112,139 | $115,136 | | **Business Payments** | Revenue | $10,945 | $10,592 | $21,933 | $20,269 | | | Gross Profit | $7,586 | $8,017 | $15,143 | $15,065 | - The Consumer Payments segment accounted for approximately **86%** of total revenue in Q2 2025, consistent with the prior year[91](index=91&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=30&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Q2 2025 revenue increased 0.9%, but net loss significantly widened to $102.3 million due to a $103.8 million goodwill impairment [Results of Operations](index=32&type=section&id=MD%26A_Results_of_Operations) Q2 2025 revenue increased 0.9% to $75.6 million, but a $103.8 million goodwill impairment led to a substantial net loss - Q2 2025 revenue increased **0.9%** YoY to **$75.6 million**, driven by new and existing client growth, partially offset by client losses and lower political media spending[111](index=111&type=chunk) - A non-cash impairment loss of **$103.8 million** was recognized in Q2 2025, with **$103.2 million** related to the Consumer Payments segment's goodwill, primarily driving the significant increase in net loss[115](index=115&type=chunk) - Selling, general and administrative expenses decreased by **6.8%** YoY, primarily due to a **$3.6 million** reduction in equity compensation expenses[113](index=113&type=chunk) [Segments](index=35&type=section&id=MD%26A_Segments) Consumer Payments revenue grew 1.7% to $70.5 million, while Business Payments revenue increased 3.8% to $10.9 million in Q2 2025 Segment Gross Profit (in thousands) | Segment | Q2 2025 | Q2 2024 | Y/Y Change | | :--- | :--- | :--- | :--- | | Consumer Payments | $55,429 | $55,546 | -0.2% | | Business Payments | $7,586 | $8,017 | -5.0% | | **Total Gross Profit (after eliminations)** | **$57,222** | **$58,585** | **-2.3%** | [Non-GAAP Financial Measures](index=37&type=section&id=MD%26A_Non-GAAP_Financial_Measures) Adjusted EBITDA decreased 5.7% to $31.8 million, and Adjusted Net Income fell 12.3% to $19.1 million in Q2 2025 Non-GAAP Performance (in thousands, except per share) | Metric | Q2 2025 | Q2 2024 | Y/Y Change | | :--- | :--- | :--- | :--- | | Adjusted EBITDA | $31,811 | $33,728 | -5.7% | | Adjusted Net Income | $19,083 | $21,762 | -12.3% | | Adjusted Net Income per share | $0.20 | $0.22 | -9.1% | - The main adjustments from Net Loss to Adjusted EBITDA include adding back the **$103.8 million** non-cash impairment loss, **$25.5 million** in depreciation & amortization, and **$3.0 million** in share-based compensation expense[149](index=149&type=chunk) [Liquidity and Capital Resources](index=44&type=section&id=MD%26A_Liquidity_and_Capital_Resources) The company maintains strong liquidity with $162.6 million in cash and a $250.0 million undrawn credit facility - The company's liquidity position as of June 30, 2025, includes **$162.6 million** in cash and **$250.0 million** in available borrowing capacity[163](index=163&type=chunk) - The board of directors increased the authorized Share Repurchase Program to **$75 million** in May 2025, with **4.8 million** shares repurchased for **$22.6 million** in Q2 2025[165](index=165&type=chunk) - Net cash from operating activities for the first six months of 2025 was **$35.6 million**, a decrease from **$55.8 million** in the same period of 2024[167](index=167&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=46&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate exposure on its undrawn variable-rate revolving credit facility - The primary market risk is interest rate risk associated with the floating-rate revolving credit facility, where increases in interest rates could increase the cost of debt if utilized[182](index=182&type=chunk) - The company does not expect significant impact from inflation or foreign currency exchange rate risk[180](index=180&type=chunk)[184](index=184&type=chunk) [Controls and Procedures](index=48&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective, with no material changes to internal controls over financial reporting - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of June 30, 2025[186](index=186&type=chunk) - No material changes to internal control over financial reporting were identified during the quarter[187](index=187&type=chunk) [PART II – OTHER INFORMATION](index=49&type=section&id=PART%20II%20%E2%80%93%20OTHER%20INFORMATION) [Legal Proceedings](index=49&type=section&id=Item%201.%20Legal%20Proceedings) The company does not anticipate any material adverse effects from ongoing legal proceedings - The company states that it does not expect any currently pending legal proceedings to have a material adverse effect on its business, prospects, or financial results[189](index=189&type=chunk) [Risk Factors](index=49&type=section&id=Item%201A.%20Risk%20Factors) No material changes to previously disclosed risk factors were reported for the quarter - No material changes to risk factors were reported for the quarter[190](index=190&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=49&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased over 5 million shares at an average price of $4.72 per share during Q2 2025 Issuer Purchases of Equity Securities (Q2 2025) | Period | Total Shares Purchased | Average Price Paid per Share | Shares Purchased as Part of Program | | :--- | :--- | :--- | :--- | | April 2025 | 619 | $4.39 | — | | May 2025 | 1,667,033 | $4.39 | 1,411,298 | | June 2025 | 3,356,296 | $4.88 | 3,353,168 | | **Total** | **5,023,948** | **$4.72** | **4,764,466** | [Other Information](index=49&type=section&id=Item%205.%20Other%20Information) The General Counsel adopted a Rule 10b5-1 trading plan for the potential sale of up to 90,000 shares - The company's General Counsel, Tyler B. Dempsey, adopted a Rule 10b5-1 trading plan on June 13, 2025, for the sale of up to **90,000** shares of Class A common stock[195](index=195&type=chunk) [Exhibits](index=51&type=section&id=Item%206.%20Exhibits) The report includes required exhibits and certifications from key executive officers