Financial Performance and Key Metrics Changes - Priority reported a 6% increase in net revenue, with adjusted gross profit and adjusted EBITDA growing by 10% and 6% respectively [5][9] - Adjusted EPS increased by $0.10, or 56% year-over-year, reaching $0.28 in Q3 [5] - The company ended Q3 with over 1.7 million customer accounts, up from 1.4 million in the previous quarter [6] - Annual transaction volume increased by nearly $4 billion to $144 billion, with average account balances improving by almost $200 million to $1.6 billion [6][10] - Adjusted gross profit margin improved to 39.2%, a 140 basis point increase from the prior year [10] Business Segment Performance Changes - Merchant Solutions revenue grew by 2% to $161.9 million, with core portfolio growth of 4% and contributions from Boom Commerce [19] - Payables segment revenue increased by 13.6% to $25.2 million, with buyer-funded revenues growing by 11.8% and supplier-funded revenues by 21.3% [20] - Treasury Solutions revenue rose by 18.2% to $55.7 million, driven by strong enrollment trends and increased billed clients [22] - Payables and Treasury Solutions accounted for nearly 63% of adjusted gross profit, reflecting a strategic shift towards higher-margin segments [18] Market Data and Key Metrics Changes - The company experienced stable merchant attrition, indicating macroeconomic factors affecting spending [6] - Revenue growth expectations for the full year were revised down to 8-10%, from a previous range of 10-12.5% [7] - The company raised the low end of its full-year gross profit guidance to $370 million, while adjusted EBITDA guidance was slightly improved to $223 million-$228 million [7][29] Company Strategy and Industry Competition - The company is focusing on expanding its commerce platform and enhancing its service offerings in higher-margin segments [12][13] - Recent acquisitions, including Boom Commerce and Dealer Merchant Services, are aimed at strengthening capabilities in automotive commerce and expanding distribution [14] - The reclassification of operating segments to Merchant Solutions, Payables, and Treasury Solutions reflects the evolving business mix and client base [8] Management's Comments on Operating Environment and Future Outlook - Management noted that Q3 was not among the best performing quarters, but emphasized internal growth and strategic investments [31] - The company is committed to maintaining cost discipline while investing in higher growth segments [13][32] - Preliminary expectations for 2026 include high single-digit revenue growth and adjusted gross margins expanding by 75 to 100 basis points [30][60] Other Important Information - The company generated $29 million in free cash flow for the quarter, totaling $71 million year-to-date [27] - Debt at the end of the quarter was $1 billion, with $157 million of available equity [25] - The company is focused on debt reduction while evaluating strategic acquisition opportunities [28] Q&A Session Summary Question: When did the company start seeing same-store sales weakness? - Management noted that signs of weakness began in August and accelerated in September, particularly in the restaurant, construction, and wholesale trade sectors [35][36] Question: What was the impact of lower revenue from specialized acquiring and historical residual purchases? - The impact was approximately $2 million on a year-over-year basis, down from $4.5 million in the first half of the year [38] Question: How much of the Merchant Solutions segment is still in specialized acquiring? - Specialized acquiring has grown quarter over quarter, but it remains a year-over-year headwind [54] Question: What drives the acceleration in gross profit guidance for Q4? - The acceleration is driven by higher organic growth in the Merchant Solutions segment and the full quarter impact of recent acquisitions [58]