Core Insights - Verra Mobility Corp (VRRM) reported quarterly earnings of $0.34 per share, exceeding the Zacks Consensus Estimate of $0.33 per share, and showing an increase from $0.31 per share a year ago, resulting in an earnings surprise of +3.03% [1] - The company achieved revenues of $236.03 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 1.36% and up from $222.43 million year-over-year [2] - The stock has gained approximately 4% since the beginning of the year, while the S&P 500 has increased by 7.1% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.34, with projected revenues of $237.87 million, and for the current fiscal year, the EPS estimate is $1.31 on revenues of $929.47 million [7] - The estimate revisions trend for Verra Mobility was mixed prior to the earnings release, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market [6] Industry Context - The Internet - Software industry, to which Verra Mobility belongs, is currently ranked in the top 32% of over 250 Zacks industries, suggesting that stocks in the top 50% outperform those in the bottom 50% by more than 2 to 1 [8]

Financial Data and Key Metrics Changes - Total revenue for Q2 2025 increased by 6% year-over-year to $236 million, exceeding internal expectations [6][16] - Adjusted EPS rose by 10% compared to the prior year, driven by operating performance, share repurchases, and reduced interest rates on term loan debt [6][18] - Consolidated adjusted EBITDA for the quarter was $105 million, a 3% increase year-over-year [17] Business Segment Data and Key Metrics Changes - Commercial Services revenue grew by 5% year-over-year, with RAC tolling revenue increasing by 4% [19][20] - Government Solutions service revenue increased by 7%, with total revenue up by 10% year-over-year, driven by product sales and expansion in photo enforcement programs [9][21] - T2 Systems revenue declined by 4%, attributed to reduced product sales and professional services revenue [13][22] Market Data and Key Metrics Changes - TSA volume declined by 1% year-over-year, with expectations for further modest declines in travel volume impacting revenue [8][25] - The demand for automated photo enforcement continues to grow, with enabling legislation adding approximately $225 million to the total addressable market [10][11] Company Strategy and Development Direction - The company is focused on stabilizing travel demand and finalizing the renewal contract with New York City, which is crucial for Government Solutions revenue [10][26] - The company anticipates continued growth in Government Solutions driven by camera installations and new customer contracts [26][27] - The ongoing ERP implementation is on schedule and expected to enhance operational efficiency [28] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding travel demand stabilization, while acknowledging potential risks from economic conditions [8][25] - The company reaffirmed its full-year 2025 financial guidance, with total revenue expected to be between $925 million and $935 million [25][26] - Management highlighted strong demand for automated enforcement and positive indicators in traffic safety improvements [12][29] Other Important Information - The Board of Directors authorized a $100 million stock repurchase program, which is available through November 2026 [14] - The company ended the quarter with a net debt balance of $893 million and maintained significant liquidity [24] Q&A Session Summary Question: Clarification on travel trends and assumptions for the second half - Management indicated that TSA throughput was around 99% to 100% and that they are using this rate for the second half of the year [36] Question: Insights on Fleet Management revenue decline - Management expects FMC revenue to decline further in Q3 due to macroeconomic factors and churn, but anticipates stabilization and growth thereafter [38] Question: Factors contributing to the guidance raise for Government Solutions - Management noted broad-based strength in product sales and service revenue growth outside New York City, leading to an increase in guidance [40] Question: Margins in Government Solutions and setup costs - Management explained that margin pressure was due to a mix of increased international sales and ERP implementation costs, with expectations for stabilization in the future [46][48] Question: Update on New York City contract renewal - Management stated they are working towards a resolution and will announce details once finalized [51] Question: M&A pipeline and share buyback strategy - Management confirmed ongoing interest in M&A opportunities while remaining opportunistic with share repurchases [54] Question: European operations and contributions - Management reported early success in Italy and other European countries, with multiple deployments underway [59][62] Question: Photo enforcement market and RFP process - Management indicated strong pipeline movement and conversion rates, with significant bookings translating into revenue [72]

Financial Data and Key Metrics Changes - Total revenue for the quarter increased by 6% year-over-year to $236 million, exceeding internal expectations [6][18] - Adjusted EPS rose by 10% compared to the prior year, driven by operating performance and share repurchases [6][20] - Consolidated adjusted EBITDA for the quarter was $105 million, an increase of approximately 3% year-over-year [19] Business Segment Data and Key Metrics Changes - Commercial Services revenue grew by 5% year-over-year, with RAC tolling revenue increasing by 4% [21][22] - Government Solutions service revenue increased by 7% year-over-year, with total revenue up by 10% [10][23] - T2 Systems revenue declined by about 4% for the quarter, driven by reduced product sales and professional services revenue [14][24] Market Data and Key Metrics Changes - TSA volume declined by about 1% year-over-year, with year-to-date TSA volume remaining flat compared to last year [9] - The macroeconomic environment is stabilizing, with consumer confidence improving, although travel demand is lower than previous forecasts [9][14] Company Strategy and Development Direction - The company is focused on expanding its Government Solutions segment, particularly in automated photo enforcement, which has seen legislative support across the U.S. [11][12] - A $100 million stock repurchase program has been authorized, reflecting the company's commitment to returning value to shareholders [15] - The company is maintaining its full-year 2025 financial guidance, with expectations for growth in Government Solutions and stabilization in the parking business [14][26] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth prospects in the Commercial Services segment despite anticipated challenges in the third quarter [7][14] - The company is closely monitoring the airline industry as a key indicator for travel demand, which impacts the commercial services business [9][26] - Management highlighted the importance of finalizing the renewal contract with New York City, which is expected to provide clarity on future revenue [11][53] Other Important Information - The company has seen a significant increase in total addressable market (TAM) for automated photo enforcement, with recent legislation adding approximately $225 million [12] - The ongoing ERP implementation is on schedule and within budget, with the most complex portions largely complete [29] Q&A Session Summary Question: Clarification on travel trends and assumptions for the second half - Management indicated that TSA throughput is expected to remain around 99% to 100% for the second half of the year, aligning with guidance [36][37] Question: Insights on Fleet Management challenges - Management acknowledged a small decline in FMC revenue due to macroeconomic factors and customer churn, expecting further declines in Q3 before stabilization [39] Question: Government Solutions guidance improvement - Management noted broad-based strength in Government Solutions, with higher product sales and accelerated demand for photo enforcement driving the guidance increase [42][43] Question: Margins in Government Solutions - Management explained that margin pressures were due to a mix of increased international sales and ERP implementation costs, with expectations for stabilization as growth continues [48][50] Question: Update on New York City contract renewal - Management confirmed ongoing negotiations for the New York City contract, emphasizing the importance of finalizing the agreement for future revenue clarity [53] Question: CapEx and revenue relationship - Management clarified that increased CapEx is in preparation for future demand, with expectations for significant growth in the Government Solutions business [88] Question: D&A guidance for the back half of the year - Management indicated that the decrease in D&A is due to the amortization of previous deals running off, not a reduction in overall expenses [90]

Financial Performance - Total revenue for Q2 2025 was $236 million, a 6% year-over-year increase[6] - Adjusted EBITDA for Q2 2025 reached $105 million, representing a 3% year-over-year growth[6] - Adjusted EPS for Q2 2025 was $034, a 10% year-over-year increase[6] - Free Cash Flow for Q2 2025 was $40 million, a 55% year-over-year increase[6] Strategic Highlights - Colorado and Nevada passed School Bus Stop Arm Enforcement laws, creating an incremental total addressable market of $40 million[10] - Government Solutions achieved solid Q2 bookings, potentially adding $21 million of incremental full run-rate ARR, bringing the trailing twelve months total to approximately $60 million[10] - A new $100 million stock repurchase program was authorized by the Board, valid through November 2026[10] Segment Performance - Commercial Services revenue increased by 5% year-over-year, driven by increased product adoption and tolling activity[11] - Government Solutions service revenue grew by 7% year-over-year, with 11% growth outside of New York City[11] - Parking Solutions SaaS and Services revenue remained relatively flat year-over-year, primarily due to a decline in installation and other professional services[11] 2025 Financial Outlook - The company reaffirmed its 2025 financial outlook, but noted a risk to the lower end of guidance ranges due to uncertainty in travel demand[11] - The company expects total revenue growth of 6% at the mid-point of guidance, resulting in revenue between $925 million and $935 million[43]

PART I—FINANCIAL INFORMATION [Item 1. Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) This section presents Verra Mobility's unaudited condensed consolidated financial statements for the period ended June 30, 2025, including balance sheets, statements of operations, stockholders' equity, and cash flows, with detailed notes on accounting policies and financial positions [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets increased to $1.695 billion from $1.614 billion at year-end 2024, driven by a significant rise in cash and cash equivalents, while total liabilities remained stable and total stockholders' equity grew due to net income Key Balance Sheet Items (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $147,651 | $77,560 | | Accounts receivable, net | $217,359 | $206,503 | | Goodwill | $742,390 | $735,615 | | Total assets | $1,695,432 | $1,614,489 | | **Liabilities & Equity** | | | | Long-term debt, net | $1,031,430 | $1,034,211 | | Total liabilities | $1,343,330 | $1,349,364 | | Total stockholders' equity | $352,102 | $265,125 | [Condensed Consolidated Statements of Operations and Comprehensive Income](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income) For the three months ended June 30, 2025, total revenue increased 6.1% year-over-year to $236.0 million, and net income grew 12.7% to $38.6 million, with diluted EPS rising to $0.24 Q2 Financial Performance (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Total Revenue | $236,025 | $222,426 | +6.1% | | Income from Operations | $63,194 | $61,169 | +3.3% | | Net Income | $38,575 | $34,223 | +12.7% | | Diluted EPS | $0.24 | $0.20 | +20.0% | Six-Month Financial Performance (in thousands, except per share data) | Metric | H1 2025 | H1 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Total Revenue | $459,279 | $432,156 | +6.3% | | Income from Operations | $120,579 | $115,522 | +4.4% | | Net Income | $70,914 | $63,372 | +11.9% | | Diluted EPS | $0.44 | $0.38 | +15.8% | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2025, net cash provided by operating activities significantly increased to $138.1 million, while net cash used in investing activities rose due to higher equipment purchases, and cash used in financing activities decreased due to lower share repurchase activity Cash Flow Summary for Six Months Ended June 30 (in thousands) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $138,113 | $74,368 | | Net cash used in investing activities | ($56,019) | ($27,677) | | Net cash used in financing activities | ($10,920) | ($60,917) | | **Net increase (decrease) in cash** | **$72,771** | **($14,324)** | [Notes to the Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) The notes provide details on the company's business segments, significant accounting policies, and financial statement line items, including customer concentrations, goodwill, intangible assets, long-term debt, and segment-level financial performance - The company operates through three segments: Commercial Services (toll/violations management), Government Solutions (photo enforcement), and Parking Solutions (software/hardware)[28](index=28&type=chunk)[29](index=29&type=chunk)[30](index=30&type=chunk) - Significant customer concentration exists: for the six months ended June 30, 2025, NYCDOT represented **15.0%** of total revenue, and three Commercial Services customers represented **15.2%**, **11.5%**, and **10.6%** of total revenue, respectively[36](index=36&type=chunk)[37](index=37&type=chunk) - As of June 30, 2025, the Government Solutions segment had remaining performance obligations of **$169.5 million**, with **$75.9 million** expected to be recognized as revenue in the next twelve months[43](index=43&type=chunk) Segment Revenue and Profit (Six Months Ended June 30, 2025, in thousands) | Segment | Total Revenue | Segment Profit | | :--- | :--- | :--- | | Commercial Services | $210,439 | $135,139 | | Government Solutions | $208,922 | $59,500 | | Parking Solutions | $39,918 | $6,122 | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=25&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the financial results for the three and six months ended June 30, 2025, highlighting a 6.3% year-over-year revenue increase for the six-month period to $459.3 million, driven by increased travel volume and enforcement program expansion, alongside recent events, liquidity, capital resources, and debt obligations - Total revenue for the six months ended June 30, 2025, increased by **6.3%** to **$459.3 million**, driven by growth in the Commercial Services and Government Solutions segments[103](index=103&type=chunk) - The company is in contract negotiations with NYCDOT for a new five-year contract expected to commence after the current one expires in December 2025, where a material change in terms could adversely affect financial results[104](index=104&type=chunk)[12](index=12&type=chunk) - A new **$100.0 million** share repurchase program was authorized on May 17, 2025, valid until November 2026, following the conclusion of the previous ASR program in March 2025[107](index=107&type=chunk) - The company's Revolving Credit Agreement commitment was increased from **$75.0 million** to **$125.0 million** in May 2025, with no outstanding borrowings as of June 30, 2025[105](index=105&type=chunk)[159](index=159&type=chunk) [Results of Operations](index=29&type=section&id=Results%20of%20Operations) For Q2 2025, revenue grew 6.1% year-over-year, driven by increases in Commercial Services and Government Solutions service revenue, while operating expenses rose 8.6% due to higher subcontractor costs, and net income increased 12.7% to $38.6 million, aided by reduced net interest expense Q2 2025 vs Q2 2024 Revenue by Segment (in thousands) | Segment | Q2 2025 Revenue | Q2 2024 Revenue | YoY Change | | :--- | :--- | :--- | :--- | | Commercial Services | $109,050 | $103,985 | +4.9% | | Government Solutions | $107,100 | $97,715 | +9.6% | | Parking Solutions | $19,875 | $20,726 | -4.1% | - The increase in Government Solutions service revenue was primarily driven by the expansion of bus lane and school bus stop arm enforcement programs, contributing **$4.6 million** in Q2 2025[127](index=127&type=chunk) - Net interest expense for Q2 2025 decreased by **$2.2 million** year-over-year to **$16.6 million**, attributed to voluntary debt prepayments and a lower interest rate from the October 2024 refinancing[133](index=133&type=chunk) [Liquidity and Capital Resources](index=35&type=section&id=Liquidity%20and%20Capital%20Resources) The company's primary liquidity sources are cash from operations and its Revolver, with $147.7 million cash on hand and $123.9 million available under the upsized $125.0 million Revolver as of June 30, 2025, alongside early debt repayments and a new $100 million share repurchase program - Cash and cash equivalents stood at **$147.7 million** as of June 30, 2025[159](index=159&type=chunk) - The company increased its Revolver commitment to **$125.0 million** in May 2025 and had **$123.9 million** available for borrowing as of June 30, 2025[159](index=159&type=chunk) - The final settlement of the December 2024 Accelerated Share Repurchase (ASR) agreement occurred on March 3, 2025, with the company receiving an additional **685,934 shares**[162](index=162&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=38&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate risk associated with its variable-rate 2021 Term Loan, which had an outstanding balance of $691.1 million at a 6.6% interest rate as of June 30, 2025, with a 1% interest rate change estimated to impact annual interest expense by approximately $6.9 million, following the cancellation of its interest rate swap agreement in Q3 2024 - The company is exposed to interest rate risk from its variable-rate 2021 Term Loan, with a balance of **$691.1 million** at June 30, 2025[183](index=183&type=chunk)[184](index=184&type=chunk) - A **1%** movement in interest rates is estimated to change annual interest expense by approximately **$6.9 million**[185](index=185&type=chunk) - The company's interest rate swap agreement was canceled in Q3 2024, leaving it unhedged against interest rate fluctuations on its term loan[185](index=185&type=chunk) [Item 4. Controls and Procedures](index=38&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of June 30, 2025, despite changes to certain processes and internal controls over financial reporting resulting from the first phase implementation of a new global ERP system - The CEO and CFO concluded that disclosure controls and procedures were effective as of June 30, 2025[186](index=186&type=chunk) - A significant change in internal control over financial reporting occurred during the quarter with the first phase implementation of a new global ERP system[187](index=187&type=chunk) PART II—OTHER INFORMATION [Item 1. Legal Proceedings](index=40&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal actions in the ordinary course of business, notably the Brantley v. City of Gretna class action lawsuit concerning a safety camera program, for which a settlement agreement received preliminary court approval in April 2025, with the final amount yet to be determined - The company is a defendant in the Brantley v. City of Gretna class action lawsuit concerning a safety camera program[191](index=191&type=chunk) - A settlement agreement for the Brantley case received preliminary court approval in April 2025, but the final amount is pending final court approval[191](index=191&type=chunk) [Item 1A. Risk Factors](index=40&type=section&id=Item%201A.%20Risk%20Factors) This section updates the company's risk factors, highlighting that share repurchase programs may not enhance long-term shareholder value, could increase stock price volatility, and will diminish cash reserves, further noting the 1% excise tax on net share repurchases that increases program costs - A new risk factor was added concerning share repurchase programs, stating they may not enhance shareholder value and could increase stock price volatility[194](index=194&type=chunk) - The company highlights the **1%** excise tax on net share repurchases, introduced by the Inflation Reduction Act, which increases the cost of buying back stock[194](index=194&type=chunk)[199](index=199&type=chunk) [Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities](index=42&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities,%20Use%20of%20Proceeds,%20and%20Issuer%20Purchases%20of%20Equity%20Securities) During the three months ended June 30, 2025, Verra Mobility did not purchase any of its Class A Common Stock and did not have any sales of unregistered equity securities - There were no purchases of the company's Class A Common Stock during the three months ended June 30, 2025[200](index=200&type=chunk) - There were no sales of unregistered equity securities during the three months ended June 30, 2025[201](index=201&type=chunk)

[Verra Mobility Q2 2025 Earnings Release](index=1&type=section&id=Verra%20Mobility%20Announces%20Second%20Quarter%202025%20Financial%20Results) This section details Verra Mobility's Q2 2025 financial performance, segment results, liquidity, corporate actions, and full-year guidance [Second Quarter 2025 Financial Highlights](index=1&type=section&id=Second%20Quarter%202025%20Financial%20Highlights) Verra Mobility reported strong Q2 2025 results with a 6% increase in total revenue to $236.0 million and a 12.8% rise in net income to $38.6 million. The performance was driven by growth in both the Government Solutions and Commercial Services segments, leading the company to reaffirm its full-year 2025 guidance despite caution around stabilizing travel demand Q2 2025 Key Financial Metrics | Metric | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Total Revenue | $236.0M | $222.4M | +6% | | Net Income | $38.6M | $34.2M | +12.8% | | Diluted EPS | $0.24 | $0.20 | +20% | | Adjusted EBITDA | $105.3M | $102.2M | +3% | | Adjusted EPS | $0.34 | $0.31 | +9.7% | | Net Cash from Operations | $75.1M | $40.0M | +87.7% | - Revenue growth was primarily driven by a **7% increase** in the Government Solutions segment and a **5% increase** in the Commercial Services segment[6](index=6&type=chunk) - The increase in net income was mainly attributed to higher income from operations and a decrease in interest expense compared to the prior year[6](index=6&type=chunk) - Management reaffirmed the full-year 2025 financial guidance but expressed caution that a modest decline in travel volume could lead to results trending toward the lower end of the guided ranges[3](index=3&type=chunk) [Segment Performance](index=2&type=section&id=Second%20Quarter%202025%20Segment%20Detail) The Government Solutions segment led growth with a 10% revenue increase to $107.1 million, driven by program expansions. The Commercial Services segment grew 5% to $109.1 million from increased product adoption and tolling activity. The Parking Solutions segment saw a 4% revenue decline to $19.9 million due to lower one-time product sales Q2 2025 Segment Revenue and Profit | Segment | Revenue (Q2 2025) | Revenue (Q2 2024) | % Change | Segment Profit (Q2 2025) | Segment Profit (Q2 2024) | % Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Commercial Services | $109.1M | $104.0M | +5% | $72.0M | $69.5M | +4% | | Government Solutions | $107.1M | $97.7M | +10% | $30.1M | $29.9M | +1% | | Parking Solutions | $19.9M | $20.7M | -4% | $3.2M | $2.8M | +14% | - Government Solutions growth was driven by the expansion of bus lane, school bus stop arm, speed, and red-light enforcement programs[11](index=11&type=chunk) - Commercial Services growth resulted from increased product adoption, tolling activity, and European operations[11](index=11&type=chunk) [Liquidity and Cash Flow](index=2&type=section&id=Liquidity%20and%20Cash%20Flow) As of June 30, 2025, the company held $147.7 million in cash and cash equivalents. Net cash from operations significantly increased to $75.1 million for the quarter, driving Free Cash Flow up to $40.3 million. Net Debt was reduced to $893.4 million, improving the Net Leverage ratio to 2.2x from 2.4x at the end of 2024 Liquidity and Debt Position (as of June 30, 2025) | Metric | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $147.7M | $77.6M | | Net Debt | $893.4M | $968.0M | | Net Leverage | 2.2x | 2.4x | Q2 Cash Flow Performance | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net Cash Provided by Operations | $75.1M | $40.0M | | Free Cash Flow | $40.3M | $26.0M | - The substantial increase in cash from operations was primarily due to improved working capital management[11](index=11&type=chunk) [Corporate Developments](index=3&type=section&id=Corporate%20Developments) During the quarter, Verra Mobility increased its Revolving Credit Agreement commitment to $125 million, completed an accelerated share repurchase, and authorized a new $100 million share repurchase program. The company also entered into a lease for a new corporate headquarters in Mesa, Arizona - On May 15, 2025, the company amended its Revolving Credit Agreement, increasing the commitment from **$75.0 million to $125.0 million**[12](index=12&type=chunk) - The company completed an accelerated share repurchase (ASR) on March 3, 2025, receiving a total of **4,507,892 shares**. The prior repurchase program ended on April 30, 2025[13](index=13&type=chunk) - On May 17, 2025, the Board of Directors authorized a new share repurchase program for up to **$100.0 million** of Class A Common Stock, valid until November 2026[14](index=14&type=chunk) - A lease agreement for a new corporate headquarters in Mesa, Arizona was signed on May 29, 2025, with relocation expected in early 2026[15](index=15&type=chunk) [2025 Full Year Guidance](index=3&type=section&id=2025%20Full%20Year%20Guidance) Verra Mobility reaffirmed its full-year 2025 guidance, projecting total revenue between $925 million and $935 million and Adjusted EBITDA of $410 million to $420 million. Key underlying assumptions include an effective tax rate of 28.5% to 29.5% and capital expenditures of approximately $110 million Full Year 2025 Financial Guidance | Metric | Guidance Range | | :--- | :--- | | Total Revenue | $925M - $935M | | Adjusted EBITDA | $410M - $420M | | Adjusted EPS | $1.30 - $1.35 | | Free Cash Flow | $175M - $185M | - Key assumptions for the 2025 guidance include: - Weighted average diluted share count of **~163 million** - Effective tax rate of **28.5% to 29.5%** - Depreciation and amortization of **~$110 million** - Capital expenditures of **~$110 million**[21](index=21&type=chunk) [Financial Statements](index=10&type=section&id=Financial%20Statements) This section presents Verra Mobility's condensed consolidated balance sheets, statements of operations, and cash flows for the reported periods [Condensed Consolidated Balance Sheets](index=10&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) As of June 30, 2025, total assets stood at $1.70 billion, up from $1.61 billion at year-end 2024. The increase was driven by a significant rise in cash and cash equivalents to $147.7 million. Total liabilities remained stable at $1.34 billion, while total stockholders' equity increased to $352.1 million from $265.1 million Key Balance Sheet Items (in thousands) | Account | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $147,651 | $77,560 | | Total current assets | $475,135 | $393,999 | | Total assets | $1,695,432 | $1,614,489 | | Long-term debt, net | $1,031,430 | $1,034,211 | | Total liabilities | $1,343,330 | $1,349,364 | | Total stockholders' equity | $352,102 | $265,125 | [Condensed Consolidated Statements of Operations](index=11&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) For the second quarter of 2025, total revenue increased 6% year-over-year to $236.0 million. Income from operations grew modestly to $63.2 million, and with lower interest expense, net income rose 12.8% to $38.6 million, resulting in a diluted EPS of $0.24 Q2 Statement of Operations Highlights (in thousands) | Account | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Total revenue | $236,025 | $222,426 | | Income from operations | $63,194 | $61,169 | | Interest expense, net | $16,572 | $18,845 | | Net income | $38,575 | $34,223 | | Diluted EPS | $0.24 | $0.20 | [Condensed Consolidated Statements of Cash Flows](index=12&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) For the three months ended June 30, 2025, net cash provided by operating activities more than doubled to $75.1 million from $40.0 million in the prior-year period. Net cash used in investing activities increased to $34.8 million due to higher equipment purchases, while financing activities used a minimal $2.2 million Q2 Statement of Cash Flows Highlights (in thousands) | Account | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $75,148 | $40,036 | | Net cash used in investing activities | ($34,800) | ($13,740) | | Net cash used in financing activities | ($2,186) | ($54,636) | | Net increase (decrease) in cash | $39,394 | ($27,830) | [Non-GAAP Financial Measures and Reconciliations](index=7&type=section&id=Non-GAAP%20Financial%20Measures%20and%20Reconciliations) This section provides reconciliations of GAAP to non-GAAP financial measures, including Adjusted EBITDA, Adjusted Net Income, Adjusted EPS, Net Debt, and Net Leverage [Reconciliation of Net Income to Adjusted EBITDA](index=14&type=section&id=Reconciliation%20of%20Net%20Income%20to%20Adjusted%20EBITDA) Adjusted EBITDA for Q2 2025 was $105.3 million, a 3% increase from $102.2 million in Q2 2024. The reconciliation from net income includes adjustments for interest, taxes, D&A, and other items like stock-based compensation. The Adjusted EBITDA margin was 45% for the quarter, compared to 46% in the prior year Net Income to Adjusted EBITDA Reconciliation (in thousands) | Line Item | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net income | $38,575 | $34,223 | | Interest expense, net | $16,572 | $18,845 | | Income tax provision | $14,027 | $13,369 | | Depreciation and amortization | $29,155 | $27,465 | | **EBITDA** | **$98,329** | **$93,902** | | Stock-based compensation & other | $7,000 | $8,249 | | **Adjusted EBITDA** | **$105,321** | **$102,151** | [Reconciliation of Net Income to Adjusted Net Income and Adjusted EPS](index=15&type=section&id=Reconciliation%20of%20Net%20Income%20to%20Adjusted%20Net%20Income%20and%20Calculation%20of%20Adjusted%20EPS) Adjusted Net Income for Q2 2025 was $55.2 million, up from $51.9 million in Q2 2024. After adjusting for items like amortization of intangibles and stock-based compensation, the Adjusted EPS was $0.34 per share, compared to $0.31 in the prior-year period Adjusted Net Income and Adjusted EPS Calculation (in thousands, except per share data) | Line Item | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net income | $38,575 | $34,223 | | Total adjustments after tax effect | $16,598 | $17,683 | | **Adjusted Net Income** | **$55,173** | **$51,906** | | Diluted weighted average shares | 161,543 | 168,615 | | **Adjusted EPS** | **$0.34** | **$0.31** | [Reconciliation of Net Debt and Net Leverage](index=16&type=section&id=Reconciliation%20of%20Total%20Long-Term%20Debt%2C%20Net%20to%20Net%20Debt%20and%20Net%20Leverage) As of June 30, 2025, Net Debt was calculated at $893.4 million, a decrease from $968.0 million at the end of 2024. This reduction, combined with a higher trailing twelve months Adjusted EBITDA of $407.4 million, resulted in an improved Net Leverage ratio of 2.2x Net Debt and Net Leverage Calculation (in thousands) | Line Item | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Total long-term debt, net | $1,031,430 | $1,034,211 | | Less: Cash and cash equivalents | ($147,651) | ($77,560) | | **Net Debt** | **$893,408** | **$968,008** | | Trailing twelve months adjusted EBITDA | $407,446 | $401,614 | | **Net Leverage** | **2.2x** | **2.4x** |

Core Points - Verra Mobility Corporation will report its financial results for the second quarter ended June 30, 2025, after market close on August 6, 2025 [1] - The conference call and live webcast to discuss the financial results will be hosted by CEO David Roberts and CFO Craig Conti at 5:00 p.m. ET on August 6, 2025 [2] - A live webcast will be available on the Company's Investor Relations website, and a replay will also be accessible [3] Company Overview - Verra Mobility Corporation is a leading provider of smart mobility technology solutions, focusing on making transportation safer, smarter, and more connected [4] - The company integrates vehicles, hardware, software, data, and people to provide efficient solutions for customers globally, addressing transportation safety and parking management [4] - Headquartered in Arizona, Verra Mobility operates in North America, Europe, Asia, and Australia [4]

Financial Performance - Verra Mobility's total revenue grew by $10.5 million, reaching $98.5 million in Q1 2019, compared to $88.0 million in Q1 2018 [11] - Adjusted EBITDA increased to $51.3 million, up from $45.6 million in the same quarter of 2018 [11] - The company generated $37.4 million in cash flow from operations [11] - Net debt leverage decreased from 5.1x in Q2 2018 to 3.8x in Q1 2019 [8] Segment Performance - Commercial Services - Commercial Services revenue increased by 22%, reaching $62.6 million in Q1 2019 [13, 19] - Commercial Services adjusted EBITDA improved to $38.0 million in Q1 2019, up from $29.8 million in Q1 2018 [19] - Commercial Services adjusted EBITDA margin expanded from 58% in Q1 2018 to 61% in Q1 2019 [19] Segment Performance - Government Solutions - Government Solutions revenue decreased by 3% to $35.9 million in Q1 2019 [17, 19] - Government Solutions adjusted EBITDA declined to $13.2 million from $15.8 million in the prior year [19] - Government Solutions adjusted EBITDA margin was 37% [18] Revenue Composition - Government Solutions accounted for 36% of Q1 revenue, while Commercial Services contributed 64% [10]

Financial Performance - Consolidated - Verra Mobility's total revenue in Q2 2019 increased by $11.4 million to $109.6 million, compared to $98.2 million in Q2 2018[28] - Adjusted EBITDA for Q2 2019 was $59.7 million, up from $54.6 million in the same quarter of 2018[28] - The company's leverage ratio decreased, reflecting increased EBITDA and strong cash flow generation[28] - The company generated cash flow from operations of $8.4 million[28] Financial Performance - Commercial Services - Commercial Services revenue for Q2 2019 was $68.1 million, a 14% increase compared to the same quarter in the prior year[19] - Adjusted EBITDA for Commercial Services in Q2 2019 improved by $4.4 million, or 11%, to $44.1 million[19] Financial Performance - Government Solutions - Government Solutions revenue for Q2 2019 increased by 8% to $41.5 million compared to the same quarter in the prior year[19] - Adjusted EBITDA for Government Solutions in Q2 2019 increased to $15.6 million from $14.7 million in the prior year[19] Guidance - The company updated its full-year 2019 revenue guidance to a range of $433 million to $441 million, representing year-over-year growth of 11% to 13%[29] - Adjusted EBITDA guidance for full-year 2019 was updated to a range of $235 million to $240 million, representing year-over-year growth of 12% to 15%[29] - The adjusted EBITDA margin is expected to be between 54.3% and 54.4%[29]

Financial Performance - Q3 2019 - Total revenue grew to $128.2 million in Q3 2019, an increase of $20.6 million or 19% year-over-year from $107.6 million in Q3 2018[37] - Adjusted EBITDA reached $70.8 million, up from $61.9 million in the same quarter of 2018[37] - Commercial Services revenue was $77.6 million in Q3, an 8% increase year-over-year[29] - Government Solutions revenue was $50.6 million in Q3, a 42% increase year-over-year[29] Profitability & Margins - Commercial Services adjusted EBITDA was $51.1 million in Q3, a $1.7 million or 3% improvement year-over-year[29] - Government Solutions adjusted EBITDA was $19.8 million in Q3, a $7.2 million or 58% improvement year-over-year[29] - Pro Forma Adjusted EBITDA margin was 55%[32] Debt & Leverage - Net debt leverage decreased to 3.3x[36] Acquisition - Verra Mobility acquired Pagatelia to accelerate European expansion[13]