Paysafe (US:PSFE)2026-03-03 21:01Financial Performance - Net cash flows provided by operating activities decreased by $17,649 to $236,155 for the year ended December 31, 2025, from $253,804 in 2024 [480]. - Net cash used in investing activities increased by $32,030 to $140,410 for the year ended December 31, 2025, from $108,380 in 2024 [483]. - Net cash used in financing activities decreased by $117,416 to $163,383 for the year ended December 31, 2025, from $280,799 in 2024 [485]. Liquidity and Borrowing - As of December 31, 2025, the Company had $250,168 in cash and cash equivalents, compared to $216,683 in 2024 [467]. - The total principal amount of external borrowings was $2,639,448 as of December 31, 2025, compared to $2,390,689 in 2024 [464]. - The Company believes its current cash level and borrowing capacity will be sufficient to meet operational needs and planned requirements for the foreseeable future [489]. - The Company is required to maintain minimum levels of liquidity within its regulated businesses in the United Kingdom and Ireland [466]. - The Company had $226,184 drawn on its $305,000 revolving credit facility as of December 31, 2025 [463]. Interest Rate and Currency Risk - As of December 31, 2025, a 100 basis point increase in interest rates would result in a $13.2 million unfavorable impact on net loss [452]. - The Company actively manages interest rate risk through interest rate swaps to convert floating rates to fixed rates [451]. - A 10% strengthening of the U.S. dollar would decrease the Company's net assets by $8.1 million [455]. Asset Valuation and Impairments - Goodwill for the Digital Wallets and Merchant Solutions reporting units was $1,441,303 and $635,044, respectively, with fair values exceeding carrying values by 5% and 9% [515]. - Intangible asset impairments recognized for the years ended December 31, 2025, 2024, and 2023 were $785, $823, and $1,254, respectively [518]. - A valuation allowance of $37,577 for U.K. deferred tax assets and $95,519 for U.S. deferred tax assets was recognized due to non-realizability [509]. - The Company has not recognized any goodwill impairment expense despite a sustained decline in share price [514]. - The Company regularly reviews finite-lived intangible assets for impairment, with complex assumptions affecting valuations [516]. Legal and Contingent Liabilities - The Company maintains liabilities for losses from legal actions that are recorded when probable and can be reasonably estimated [519]. - The Company has contingent consideration payables related to the acquisition of merchant portfolios, representing probable payouts [493]. - The Company has a liability to customers recognized as funds payable and amounts due to customers, with a current year outflow in Settlement funds - merchant and customers, net consistent with a decline in customer accounts and other restricted cash [488]. Credit Losses - The Company updated assumptions for estimating credit losses, which did not materially impact the estimated credit loss expense for the year ended December 31, 2025 [506].