Financial Data and Key Metrics Changes - Priority Technology reported a net revenue growth of 8% for the full year 2025, with adjusted gross profit and adjusted EBITDA growth of 14% and 10% respectively [5] - Adjusted EPS increased by $0.52 or 102% year-over-year to $1.03 for fiscal 2025 [5] - Q4 revenue was $247.1 million, a 9% increase from the prior year, leading to a 19% increase in adjusted gross profit to $100.2 million and a 16% improvement in adjusted EBITDA to $60.1 million [8][9] Business Line Data and Key Metrics Changes - Merchant Solutions generated Q4 revenue of $165.3 million, up 6.2% year-over-year, with 3% organic growth [16] - Payables segment revenue increased by 12.7% year-over-year to $26.8 million, with adjusted gross profit rising by 15.9% [18] - Treasury Solutions segment revenue grew by 17.8% to $57.3 million, driven by strong enrollment trends and an increase in billed clients [20] Market Data and Key Metrics Changes - The total customer accounts on the commerce platform increased to 1.8 million from 1.2 million year-over-year [6] - Annual transaction volume increased by $20 billion to $150 billion [6] - Average account balances under administration improved by $500 million to $1.7 billion [6] Company Strategy and Development Direction - The company anticipates achieving 6%-9% top-line revenue growth in 2026, with adjusted EBITDA expected to range from $230 million to $245 million [8][25] - Priority is focusing on high-margin segments and investing in new verticals, including real estate, healthcare, and sports entertainment [51][52] - The company is positioning itself to leverage AI's impact on SaaS business models while maintaining a disciplined tech expense structure [28][29] Management's Comments on Operating Environment and Future Outlook - Management noted stabilization in the macro environment compared to Q3, with expectations of similar conditions for 2026 [35] - The company is cautious about headwinds from lower interest rates and a challenging consumer spending environment [8][36] - Management expressed confidence in the growth of the Merchant Solutions, Payables, and Treasury Solutions segments despite market challenges [7][12] Other Important Information - The company successfully remediated a material weakness in its internal controls over financial reporting as of December 31, 2025 [27] - Free cash flow generated in Q4 was $28 million, with a run rate of approximately $112 million [23][24] Q&A Session Summary Question: Is there stabilization in the macro environment? - Management indicated that Q4 showed stabilization compared to Q3, with guidance reflecting current trends [35] Question: Update on enterprise business pipeline? - The pipeline remains strong, but conversion timelines are variable, particularly in real estate and sports [38] Question: Average CFTPay monthly enrollments? - The slowdown in Q4 is seasonal, with expectations for an uptick in Q1 as consumers resolve debts [43] Question: Key strategic priorities for 2026? - The company will continue to invest in high-growth areas, particularly in sectors like real estate and healthcare [50] Question: How to bridge the gap between gross profit and EBITDA growth? - The divergence is mainly due to investments in personnel and technology, with interest rate headwinds affecting both gross profit and EBITDA [71]

Priority Technology (NasdaqCM:PRTH) Q4 2025 Earnings call March 10, 2026 10:00 AM ET Company ParticipantsDylan Hinds - Research AssociateMeghna Mehra - Managing Diretor of Investor RelationsTim O'Leary - CFOTom Priore - Chairman and CEOVasu Govil - Managing Director of Equity Research.Conference Call ParticipantsBrian Kinstlinger - Director of Research and Senior Technology AnalystDavid Duke - AnalystJacob Stephan - Senior Research AnalystOperatorGood day, and welcome to the Priority Technology Holdings Fou ...

Financial Data and Key Metrics Changes - Priority Technology reported a net revenue growth of 8% for the full year 2025, with adjusted gross profit and adjusted EBITDA growth of 14% and 10% respectively, and adjusted EPS increased by 102% year-over-year to $1.03 [4][5] - For Q4 2025, revenue was $247.1 million, a 9% increase from the prior year, leading to a 19% increase in adjusted gross profit to $100.2 million and a 16% improvement in adjusted EBITDA to $60.1 million [6][12] - Adjusted gross profit margin for Q4 was 40.6%, up 360 basis points from the prior year, reflecting strong performance in high-margin segments [7][12] Business Line Data and Key Metrics Changes - Merchant Solutions generated Q4 revenue of $165.3 million, a 6.2% increase year-over-year, with 3% organic growth [14] - Payables segment revenue increased by 12.7% year-over-year to $26.8 million, with adjusted gross profit rising by 15.9% to $7.4 million [17] - Treasury Solutions revenue for Q4 was $57.3 million, up 17.8% year-over-year, driven by strong enrollment trends and an increase in billed clients [19] Market Data and Key Metrics Changes - The company ended 2025 with 1.8 million total customer accounts, up from 1.2 million the previous year, and annual transaction volume increased by $20 billion to $150 billion [5] - Average account balances under administration improved by $500 million to $1.7 billion [5] Company Strategy and Development Direction - The company anticipates achieving 6%-9% top-line revenue growth in 2026, with adjusted EBITDA expected to range from $230 million to $245 million [6][24] - Priority is focusing on its Connected Commerce platform to streamline financial operations for businesses, emphasizing the importance of compliance and operational efficiency [8][10] - The company is investing in high-growth areas such as real estate, healthcare, and sports entertainment, while also addressing the competitive landscape with modern technology solutions [49][50] Management's Comments on Operating Environment and Future Outlook - Management noted stabilization in the macro environment in Q4 compared to Q3, with expectations of similar conditions for 2026 [33] - The company is cautious about potential headwinds from lower interest rates and is adjusting growth expectations accordingly [34][25] - Management expressed confidence in the long-term stability and performance of the company despite economic uncertainties [29] Other Important Information - The company successfully remediated a material weakness in its internal controls over financial reporting as of December 31, 2025 [26] - Free cash flow for Q4 was $28 million, with expectations for continued cash generation in 2026 [21][58] Q&A Session Summary Question: Stabilization in the macro environment - Management indicated that Q4 showed stabilization compared to Q3, with guidance for 2026 reflecting similar macro conditions [33] Question: Update on enterprise business pipeline - The pipeline remains strong, but conversion timelines are variable, particularly in real estate and sports entertainment [36] Question: Average CFTPay monthly enrollments - The slowdown in new enrollments in Q4 was seasonal, with expectations for an uptick in Q1 [40] Question: Key strategic priorities for 2026 - The company will continue to invest in high-growth areas and maintain a disciplined approach to M&A [47][62] Question: Sustainability of Payables EBITDA growth - Management expects EBITDA growth to correlate more closely with revenue growth moving forward, with no significant margin shifts anticipated [72]