Financial Performance - The company reported a 16% increase in net revenues and a 12% increase in adjusted net income year-over-year on a non-GAAP currency neutral basis [6][33] - Operating expenses rose by 14%, with operating income increasing by 17% [34] - Net income and EPS increased by 12% and 14% respectively, with EPS at $4.15, including a $0.09 contribution from share repurchases [34] Business Line Performance - Payment Network net revenue grew by 13%, driven by domestic and cross-border transaction growth [38] - Value-added services and solutions net revenue increased by 22%, with acquisitions contributing approximately 4 percentage points to this growth [38] - Worldwide gross dollar volume (GDV) increased by 9%, with U.S. GDV up by 6% and international GDV up by 10% [35] Market Performance - Cross-border volume increased by 15% globally, reflecting growth in both travel and non-travel related spending [36] - Card present transactions grew significantly, with contactless transactions now representing 75% of all in-person switch purchase transactions [37] - The company continues to expand acceptance in various markets, including launching tap-to-pay in the Shanghai Metro [13] Company Strategy and Industry Competition - The company is focused on diversifying its business model and enhancing partnerships with leading merchants and fintechs [8][10] - New programs are being launched in various markets, including partnerships with American Airlines and Walmart [9][10] - The company is leveraging its data and product capabilities to differentiate its offerings and capture adjacent revenue opportunities [27][29] Management Commentary on Operating Environment and Future Outlook - Management remains positive about growth outlook, citing healthy consumer spending supported by low unemployment and wage growth [7][45] - The company is tightening its full-year net revenue outlook to the high end of the previously shared range, expecting low teens growth on a currency neutral basis [47] - Ongoing geopolitical and economic uncertainties are acknowledged, but the company maintains a diversified business model to mitigate risks [46] Other Important Information - The company repurchased $2.3 billion worth of stock during the quarter, with an additional $1 billion planned [34] - The effective tax rate is expected to be in the 20% to 21% range for both Q3 and the full year [49] Q&A Session Summary Question: Impact of lapping portfolios on growth metrics - Management confirmed that the lapping impact from portfolios like Citizens and Wells Fargo has become more pronounced and will continue through Q3 and Q4 [55][56] Question: Differentiation in value-added services - The company highlighted its focus on cybersecurity and personalized engagement solutions as key differentiators in its value-added services [62][66] Question: Cross-border volume growth expectations - Management noted that cross-border volumes are well diversified and continue to grow, with travel volumes representing about 60% of total cross-border volumes [95] Question: Client incentives and rebates - Management indicated that rebates and incentives as a percentage of payment network assessments are expected to increase in Q3, driven by a competitive market [101] Question: Update on Recorded Future performance - Management expressed excitement about the integration of Recorded Future, emphasizing its potential in threat intelligence and cybersecurity solutions [84][87] Question: Market share in regions with strong local players - The company is focused on differentiating its product set and building partnerships in markets like Brazil to capture cash transition opportunities [114]

Financial Data and Key Metrics Changes - Revenue for the second quarter was $230 million, an 8% increase over the prior year, while constant currency revenue was approximately $233 million, representing growth of 10% [5][11] - Adjusted EBITDA increased to $93 million, up approximately 8% year over year, with an adjusted EBITDA margin of 40.3% for the quarter [5][11] - Adjusted EPS of $0.89 was up 7% year over year, driven by strong adjusted EBITDA growth and lower interest expense [5][12] - Operating cash flow for the first half of the year was approximately $86 million, with $6.4 million returned to shareholders through dividends and $3.7 million in share repurchases [5][18] Business Line Data and Key Metrics Changes - Merchant Acquiring revenue grew 4% year over year to $47.3 million, with adjusted EBITDA of $20 million and an adjusted EBITDA margin of 42.3% [13] - Payment Services Puerto Rico revenue was $56.4 million, an increase of approximately 4% from the prior year, with adjusted EBITDA of $33 million and a margin of 58.5% [14] - Latin America Payments and Solutions revenue increased 15% year over year to $86.1 million, with adjusted EBITDA of $23.3 million, up approximately 33% from the prior year [15][16] - Business Solutions segment revenue increased approximately 4% to $64.5 million, with adjusted EBITDA of $26 million, down approximately 13% year over year [17] Market Data and Key Metrics Changes - The overall economic condition in Puerto Rico remains stable, with an unemployment rate near multi-decade lows of about 5.2% [8] - Passenger traffic in San Juan Airport was up approximately 11% year over year through April [8] - Latin America revenue increased 15% year over year or 20% on a constant currency basis, driven by organic growth and contributions from recent acquisitions [9] Company Strategy and Development Direction - The company plans to continue its share repurchase program, authorizing up to $150 million of shares to be repurchased through December 31, 2026 [9] - The company is focused on technology modernization, repricing initiatives, and margin optimization to drive growth [28][30] - The company expects to see gradual improvement in overall margins in the third quarter, with a reset lower in the fourth quarter due to a discount impacting revenue [24] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong performance in the first half of the year and an optimistic outlook for the second half, despite potential tariff impacts [34][35] - The company anticipates revenue growth of 6.6% to 7.6% for the full year, with adjusted EPS expected to grow between 4.87% from the previous year [20][21] - Management noted that the active pipeline for new business remains strong, with no significant pullback in demand due to macroeconomic factors [41][42] Other Important Information - The company’s liquidity remains strong at approximately $485 million as of June 30 [6][19] - The net debt position at quarter end was $673.6 million, with a net debt to trailing twelve-month adjusted EBITDA ratio of approximately 1.95 times [19] Q&A Session Summary Question: Update on strategic initiatives and their progress - Management highlighted that the entire segment grew double digits, with significant focus on technology modernization and repricing initiatives [28][30] Question: Outlook for the second half and macroeconomic impacts - Management indicated that the second half outlook is better than initially thought, with conservatism included regarding potential tariffs [34][35] Question: Insights on the active pipeline and business opportunities - Management confirmed a very active organic pipeline and expressed optimism about upcoming business wins, unaffected by tariff discussions [41][42] Question: Performance of ATH Mobile and growth drivers - Management noted that ATH Mobile's growth of 17% is driven by increased usage and network effects in Puerto Rico [43] Question: Acquisition strategy and focus areas - Management stated that they are actively looking for acquisition opportunities, particularly in Brazil, while integrating recent acquisitions [48][49] Question: Competitive advantages in Latin America - Management emphasized their proprietary technology, industry expertise, and local presence as key competitive advantages in Latin America [62][66]

Core Insights - GTCR, a Chicago-based private equity firm, achieved a significant exit by selling Worldpay for $24.25 billion, marking the largest private equity exit of 2025 so far [2][3] - The firm has managed to navigate a challenging market environment, completing notable transactions while many in the industry struggle to find buyers for their businesses [4][5] Group 1: Company Performance - GTCR manages $45 billion in assets, which is relatively small compared to major players like Blackstone and KKR, yet it has executed a remarkable transaction [3] - The firm sold Worldpay less than two years after acquiring a 55% stake from FIS for $18.5 billion, effectively doubling its investment [3] - GTCR is expected to return over $5 billion to investors this year, continuing a strong performance record for its flagship funds [4][5] Group 2: Historical Context and Leadership - Founded in 1980, GTCR has a long history in the private equity sector, with its founders being pioneers in the industry [5] - The current co-CEOs, Collin Roche and Dean Mihas, represent the second generation of leadership, with Roche having joined in 1996 and Mihas in 2001 [6] Group 3: Recent Transactions - Prior to the Worldpay sale, GTCR sold AssuredPartners for $13.45 billion and has also divested smaller companies like Antylia Scientific and Itel for over $1 billion each [4][5] - The Worldpay deal involved a complex asset swap with Global Payments, which acquired Worldpay while selling its card issuing solutions to FIS for $13.5 billion [7] Group 4: Future Strategy - GTCR is focusing on identifying new acquisition opportunities, having raised a new flagship fund of $11.5 billion and a strategic growth fund of $3.6 billion [8] - The firm currently has over $10 billion available for deployment, indicating a strong position to capitalize on market uncertainties [8]

Financial Data and Key Metrics Changes - The company reported a 133% year-over-year increase in consolidated income from operations, a 57% increase in consolidated adjusted EBITDA, and a 290% increase in EPS [4] - Gross profit increased 15% year-over-year, with a gross profit margin reaching a record high of 37.1% [11][12] - Adjusted EBITDA margins reached 15% in the third quarter [7] Business Line Data and Key Metrics Changes - At NRS, recurring revenue increased 23% year-over-year, driven by a 37% revenue increase from merchant services and a 32.3% increase in SaaS fees, despite a 12% decrease in advertising and data revenue [4] - The fintech segment, including Boss Money, generated over $5 million in adjusted EBITDA compared to $244,000 in the year-ago quarter [6] - Traditional communications segment income from operations and adjusted EBITDA both jumped over 30% year-over-year [8] Market Data and Key Metrics Changes - Subscription revenue increased 7% to $21.5 million in the quarter, with a higher constant currency increase of 11% [16] - The remittance platform, Boss Money, saw a 27% increase in transactions and a 25% increase in revenue [5] Company Strategy and Development Direction - The company is focusing on developing new offerings that leverage the NRS platform to help retailers compete with larger chains, particularly in online ordering and delivery [5] - The company is pursuing next-generation growth initiatives and is in the budgeting process for fiscal 2026 [9][19] - The company is exploring acquisitions but emphasizes the importance of paying the right price to extract value [29][33] Management's Comments on Operating Environment and Future Outlook - Management noted that the third quarter was slightly softer than the second quarter due to expected seasonal factors, but they remain pleased with overall performance [10] - The company expects to meet its adjusted EBITDA goal of $126 million for the full year [19] - Management expressed confidence in the long-term profitability of traditional communications as a cash generator [17] Other Important Information - The company set up a bad debt expense provision of $1.4 million related to amounts due from a client [13] - The company repurchased $6 million of employee-owned shares to satisfy tax obligations triggered by vesting [18] Q&A Session Summary Question: Insights on NRS growth and sales strategy - Management indicated that increased efforts in bringing new and existing retailers onto the merchant processing platform contributed to strong numbers this quarter [22] Question: Details on AI agent customer base - Most customers for the AI agent are existing NetSuite phone customers, with plans to expand to new customers in the future [24] Question: Future M&A activity - Management confirmed they are looking at acquisitions but will only pursue those that offer good value [29] Question: Impact of reduced advertising revenue from a partner - Management noted that while a significant partner's contribution has decreased, other advertising revenues have been growing nicely, and they are close to covering the decline [50][51] Question: Future EBITDA margins for NetSuite phone - Management expressed uncertainty but indicated that new initiatives could lead to substantial margin improvements over time [54] Question: Investment in customer acquisition for Boss Money - Management acknowledged the potential for increased investment in customer acquisition to capture market share from legacy players [57]

Summary of Fiserv (FI) 2025 Conference Call Company Overview - **Company**: Fiserv - **CEO**: Mike Lyons, recently appointed and previously associated with PNC Bank - **Industry**: Financial Technology (Fintech) and Payment Processing Key Points and Arguments Financial Performance and Growth - Fiserv has achieved 40 consecutive years of over 10% EPS growth, indicating a stable growth trajectory [1] - The financial segment is projected to grow at 6% to 8% this year, reflecting a strong demand for technology solutions among financial institutions [12][10] - The company serves approximately 10,000 financial institutions globally, with a significant presence in the U.S. [14] Technology and Client Relationships - Fiserv emphasizes a "client first mindset," focusing on understanding client needs and delivering tailored solutions [6] - The company has 13,000 software engineers, enabling it to provide advanced technological solutions to financial institutions [4] - The demand for modernized payments and digital solutions is increasing, with banks needing to adapt to consumer expectations for ease of transactions and automation [13] Strategic Initiatives - Fiserv is modernizing its core banking systems, consolidating from 16 to 5 core systems, with a focus on cloud-based solutions [16] - The company is pursuing embedded finance opportunities, allowing merchants to offer banking-like services [17] - Recent acquisitions, such as Payfair, are aimed at enhancing Fiserv's capabilities in embedded finance and card issuing [18] Clover and Merchant Segment - Clover, Fiserv's merchant platform, is experiencing low double-digit growth, with expectations for significant revenue growth in the coming years [40][54] - The company is focused on expanding Clover's capabilities, integrating various services such as payroll and cash management [46][49] - Fiserv aims to enhance operational excellence and expand distribution channels for Clover, leveraging partnerships with banks and ISOs [53] Market Dynamics and Competitive Landscape - The competitive landscape remains challenging, but Fiserv believes there is still room for growth, particularly in the merchant segment [41] - The company is not experiencing market saturation and continues to explore new markets, including international expansion [51] Economic and Market Outlook - The macroeconomic backdrop is viewed positively, with stable demand for Fiserv's services [64] - The Fiserv Small Business Index indicates a steady growth rate, reflecting the health of small businesses [66] Emerging Trends - Fiserv is exploring opportunities in stablecoins and cryptocurrency, preparing to support clients with wallet and custody solutions [33][34] - The company is positioned to assist both financial institutions and merchants in adapting to technological changes in the payment landscape [37] Additional Important Insights - The merger with First Data has proven beneficial, with synergies still being realized [21] - Fiserv's approach to client engagement is centered on providing integrated solutions that meet the evolving needs of small businesses [45] - The company is committed to operational improvements and enhancing customer service to drive user engagement with its platforms [57] This summary encapsulates the key insights from the Fiserv conference call, highlighting the company's strategic direction, growth prospects, and market positioning within the fintech industry.

Financial Data and Key Metrics Changes - The company reported record first-quarter revenues with a 5% increase in revenues, and a 6% increase excluding net income, which was down from the previous year [4][5] - Total processing volume increased by 34%, with ACH processing volume up 36% [5][19] - Adjusted EBITDA rose to $700,000 in the quarter, up from $500,000 in the previous quarter [6] - Cash position improved to $8.7 million at quarter end, generating $700,000 in cash during the quarter [6][26] Business Line Data and Key Metrics Changes - PayFac processing dollars were up 33%, leading to a 25% increase in PayFac revenue, which now accounts for approximately 59% of total card revenues [12][19] - ACH revenues increased by 33%, with electronic transaction volumes up 36%, marking the sixth consecutive quarter of growth [19] - Output Solutions revenues increased by 12% sequentially, with electronic documents processed up 5% [20] Market Data and Key Metrics Changes - The company is experiencing strong growth in its PayFac business, with 17 new ISVs in various stages of implementation [12] - The company is focusing on small to medium business markets, leveraging its technology to diversify its account base [23] Company Strategy and Development Direction - The company launched the UCO-one initiative to enhance cross-selling opportunities across its business lines [10][18] - There is a strategic focus on improving gross and EBITDA margins, with a long-term goal of achieving 25% gross margins and 8% to 10% EBITDA margins [40][26] - The company is exploring M&A opportunities that align with its strategic goals and can provide synergies [44][26] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving 14% to 16% revenue growth for the year, driven by a strong pipeline of deals expected to close in the second half [8][27] - The company is insulated from macroeconomic challenges due to its diversified product portfolio [27] - Management highlighted the potential of new technologies, including a biometrics AI-driven application, to revolutionize payment methods [24][26] Other Important Information - The company is committed to improving operating leverage, with headcount below that of the previous year [6] - The company is generating strong cash flow and has a healthy balance sheet, providing flexibility for growth initiatives and potential acquisitions [26] Q&A Session Summary Question: Clarification on organic revenue growth - Management confirmed that adjusting for spoilage revenue from the previous year, organic growth was over 10% [29] Question: Insights on UCO-one initiative and sales team composition - The company has 12 quota-bearing salespeople and is moving to a standardized CRM to facilitate cross-selling [32][34] Question: Gross margin decline explanation - Management explained that the decline was due to the absence of high-margin spoilage revenue from the previous year [35] Question: Future gross margin expectations - Management aims to return gross margins to mid-20s as revenue scales [40] Question: M&A criteria and opportunities - The company looks for synergies, favorable acquisition multiples, and the ability for acquired companies to operate independently post-acquisition [44] Question: Investor sentiment and stock performance - Management noted increased interest from quant funds and positive investor sentiment due to strong financial performance [45][46]

Financial Data and Key Metrics Changes - The company reported record first quarter revenues with a 5% increase in revenues, and a 6% increase excluding net income, which was down from the previous year [4][6] - Total processing volume increased by 34%, with ACH processing volume up 36% [4][6] - Adjusted EBITDA rose to $700,000 in the quarter, up from $500,000 in the fourth quarter of 2024 [5] - Cash position improved to $8.7 million at quarter end, generating $700,000 in cash during the quarter [5][6] Business Line Data and Key Metrics Changes - PayFac processing dollars were up 33% in the quarter, leading to a 25% increase in PayFac revenue, which now accounts for approximately 59% of total card revenues [11][12] - ACH revenues increased by 33%, with electronic transaction volumes up 36%, marking the sixth consecutive quarter of growth [17][18] - Output Solutions revenues increased by 12% sequentially, with electronic documents processed up 5% [19][20] Market Data and Key Metrics Changes - The company is experiencing strong growth in its PayFac business, with 17 new ISVs in various stages of implementation [11] - The company is focusing on small retail merchants with a new filtered spend program, which allows targeted spending [13] Company Strategy and Development Direction - The company is pursuing a dual mandate to grow the business while improving profitability through better leveraging of its infrastructure [6][25] - The UCO-one initiative aims to enhance cross-selling opportunities across business lines, with early successes already noted [8][10] - The company is strategically focused on the small to medium business market and plans to add a payroll card offering to its portfolio [22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving 14% to 16% top-line revenue growth for the year, with expectations for acceleration in the second half [6][26] - The company remains insulated from macroeconomic challenges due to its diversified product portfolio [26] - Management highlighted the potential of new technologies, including a biometrics AI-driven application, to revolutionize payment methods [23][24] Other Important Information - The company is generating strong cash flow and has the flexibility to evaluate strategic acquisitions [25] - Management emphasized the importance of efficiency and productivity efforts to improve gross and EBITDA margins [25] Q&A Session Summary Question: Clarification on organic revenue growth - Management confirmed that there was over $1 million in spoilage revenue in the year-ago period, affecting organic growth rates [30] Question: Insights on UCO-one initiative and sales team composition - The company has 12 quota-bearing salespeople and is moving to a standardized CRM to facilitate cross-selling [33][35] Question: Gross margin decline explanation - Management explained that the decline in gross margin was due to the absence of high-margin spoilage revenue from the previous year [37] Question: Future gross margin expectations - Management aims for gross margins to reach around 25% as revenue scales [42] Question: M&A criteria and opportunities - The company looks for synergies, favorable acquisition multiples, and the ability for acquired companies to operate independently post-acquisition [46][47]

Summary of Global Payments (GPN) FY Conference Call - May 13, 2025 Company Overview - **Company**: Global Payments (GPN) - **Industry**: Payments and IT Services Key Points and Arguments Transaction Update - Global Payments is optimistic about the recent asset swap transaction involving Worldpay, despite the macroeconomic uncertainty at the time of announcement [6][7][8] - The transaction is viewed as a unique opportunity that enhances long-term value creation for the company [7][8] - The integration of Worldpay is expected to create a powerful combination due to complementary strengths between the two businesses [10][12] Market and Economic Conditions - The consumer market remains resilient, with stable spending trends observed throughout 2025 [13][14] - Wage growth is steady, and inflation is under control, contributing to a favorable backdrop for consumer spending [14][15] - Global Payments has seen positive trends in international markets, particularly in Asia, with increased cross-border activity [19] Business Performance - The first quarter results were strong, with stable underlying trends and good execution across the business [18][19] - Global Payments did not experience the same deceleration as peers, attributed to unique business dynamics and execution [21][22][23] Integration Strategy - The integration of Worldpay will be approached with a focus on creating a unified operating model, avoiding a return to a holding company structure [28][29] - The goal is to combine the businesses under a common brand and leverage existing scalable processes [29] Depth vs. Breadth Strategy - Global Payments aims to maintain both depth and breadth in its merchant services, focusing on commerce enablement solutions for a wide range of merchants [31][32][34] - The transaction with Worldpay is seen as a way to enhance capabilities across the full spectrum of merchant opportunities [34] Competitive Positioning - The combined entity will have significant scale, with a projected processing volume of $4 trillion, allowing for substantial investment in innovation [11][37] - Global Payments aims to differentiate itself through feature-rich product offerings and a strong service experience, rather than competing solely on price [41][42] Product Launch: Genius Platform - The Genius platform is being launched to consolidate point-of-sale capabilities, designed for dynamic environments like restaurants and retail [44][46] - Genius is positioned as a fully integrated solution that can cater to both small businesses and large enterprises [49][50] Worldpay's Growth Profile - Worldpay is currently a mid-single-digit grower, with significant investments made in product and capability, particularly in e-commerce and enterprise sectors [54][55] - The integration is expected to enhance Global Payments' ability to serve software platform and marketplace partners with tailored solutions [57] Cost Synergies - Global Payments is confident in achieving the projected $600 million in cost synergies from the Worldpay integration, which represents about 18% of Worldpay's expense base [68] Future Outlook - The company anticipates a period of consolidation in the payments industry, driven by the need for scale and regulatory pressures [82][84] - Global Payments is focused on maintaining its investment-grade credit rating while also returning capital to shareholders post-divestitures [75][76] Capital Allocation - The company plans to continue stock buybacks while managing leverage, aiming to return significant capital to shareholders in the coming years [74][76][78] Additional Important Insights - The integration of Worldpay is expected to free up resources and attention previously dedicated to the issuer business, allowing for a more focused execution strategy [63][64] - The management expresses confidence in their team's ability to execute the integration successfully, emphasizing the importance of execution in realizing the transaction's potential [65][66]

Financial Data and Key Metrics Changes - In Q1 2025, revenue was $77.3 million, representing a decrease of 4% year over year [22] - Reported gross profit declined by 5% year over year, with consumer payment segment gross profit also down by 5%, while business payment segment gross profit increased by 77% year over year [22] - Adjusted EBITDA for Q1 was $33.2 million, maintaining an adjusted EBITDA margin of approximately 43% [23] - Reported free cash flow was negative $8 million, impacted by client losses and working capital changes, but excluding these impacts, free cash flow conversion would have been similar to 38% in Q1 2024 [24] Business Line Data and Key Metrics Changes - Consumer payments showed core growth with contributions from existing clients and new client wins, despite client losses impacting reported growth [8][12] - Business payments reported a gross profit increase of approximately 7% year over year, with a normalized growth of about 12% when excluding political media contributions from the previous year [13][22] - Instant funding product in value-added services saw transaction volumes rise approximately 19% year over year [11] Market Data and Key Metrics Changes - Non-discretionary consumer spending remained resilient year to date, with no major impacts observed from macroeconomic factors [9][52] - The company signed two new software partnerships in consumer payments, increasing total software partners to 182 [10] Company Strategy and Development Direction - The company concluded its strategic review process, focusing on organic growth investments rather than M&A, believing this will yield the best results for shareholders [16][17] - Key operational priorities include enhancing the direct sales model, capitalizing on monetization opportunities, and building indirect partnership channels [17] - The company aims for sequential quarterly normalized gross profit growth, projecting high single-digit to low double-digit growth by Q4 2025 [18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to invest organically and produce results that generate shareholder value, with expectations for growth acceleration in the second half of 2025 [18][19] - The macroeconomic environment has changed, but the company remains focused on profitable growth and cash flow generation [16][19] Other Important Information - The Board of Directors increased the share repurchase program authorization to $75 million, maintaining a strong balance sheet with ample liquidity [19][25] - Tim Murphy, the CFO, will be stepping down, with Thomas Sullivan appointed as interim CFO [20][19] Q&A Session Summary Question: Can you provide additional color on the consumer spending environment? - Management noted resiliency in non-discretionary consumer spending, with no major impacts from overall payment processing related to macroeconomic factors [29] Question: Given the increased buyback authorization, do you plan to continue leaning into this rather than M&A? - Management confirmed that they will opportunistically repurchase shares when the share price is disconnected from intrinsic value, while focusing on organic growth [30][31] Question: How far did you go down the strategic review process? - The company assessed various strategic alternatives but concluded that additional investment in organic growth would yield the best results for shareholders [34] Question: Can you help us think about the EBITDA growth trajectory over 2025? - Management indicated that adjusted EBITDA growth would follow a similar path as gross profit growth, with no incremental spend beyond what has been forecasted [38] Question: What are you seeing in terms of repayment volume health in the auto vertical? - Management reported strength in nondiscretionary spending in the auto sector, with no specific issues observed [77]

Financial Data and Key Metrics Changes - In Q1 2025, revenue was $77.3 million, representing a decrease of 4% year over year [19] - Reported gross profit declined by 5% year over year, with consumer payment segment gross profit also down by 5%, while business payment segment gross profit increased by 77% year over year [19] - Adjusted EBITDA for Q1 was $33.2 million, reflecting approximately 43% adjusted EBITDA margins [21] - Reported free cash flow was negative $8 million, impacted by client losses and working capital changes [22] - As of March 31, the company had approximately $165 million in cash and access to $250 million in undrawn revolver capacity, totaling $415 million in liquidity [23] Business Line Data and Key Metrics Changes - Consumer payments showed core growth with contributions from existing clients and new client wins, despite client losses impacting reported growth [6][10] - Business payments reported a gross profit increase of approximately 7% year over year, with a normalized growth of about 12% when excluding political media contributions from the previous year [11][19] - The company signed two new software partnerships in consumer payments, increasing total software partners to 182 [8] Market Data and Key Metrics Changes - The company noted resiliency in non-discretionary consumer spending year to date, despite economic unpredictability [7] - The sales pipeline for enterprise clients remains healthy, with ongoing efforts to enhance payment capabilities [7][8] Company Strategy and Development Direction - The company concluded its strategic review process, focusing on organic growth investments as the best way to create shareholder value [13][14] - Key operational priorities include enhancing the direct sales model, capitalizing on monetization opportunities, and building indirect partnership channels [15] - The company aims for sequential quarterly normalized gross profit growth, targeting high single-digit to low double-digit growth by Q4 2025 [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to invest organically and produce results that generate shareholder value [16] - The company anticipates free cash flow conversion exceeding 50% in Q2 and accelerating above 60% by year-end, excluding one-time impacts [22] - Management acknowledged the ongoing macroeconomic uncertainties but emphasized the strength of their business model and value proposition [7][10] Other Important Information - The company announced an increase in its share repurchase program authorization to $75 million [17] - Tim Murphy, the CFO, will be stepping down, with Thomas Sullivan appointed as interim CFO [18] Q&A Session Summary Question: Can you provide additional color on the consumer spending environment? - Management noted resiliency in non-discretionary consumer spending year to date, with no major impacts from overall payment processing related to macroeconomic factors [26][27] Question: Given the increased buyback authorization, do you plan to focus more on this rather than M&A? - Management confirmed that they will opportunistically repurchase shares when they believe the share price is disconnected from intrinsic value, while still focusing on organic growth [28][30] Question: How far did you go down the strategic review process? - Management indicated that the decision to conclude the review was based on the belief that additional investment in organic growth would yield the best results for shareholders [33][34] Question: Can you discuss the EBITDA growth trajectory for 2025? - Management expects adjusted EBITDA growth to follow a similar path as gross profit growth, with no incremental spend beyond what has been forecasted [36] Question: What are the trends in the auto vertical? - Management reported strength in nondiscretionary spending within the auto vertical, with no significant changes observed in client dynamics [75]