Q2 2026 Repay Holdings Corp Earnings Call Transcript
Key Points
- Repay Holdings Corp (RPAY) delivered strong Q2 2026 results with 33% reported revenue growth and 6% organic growth, exceeding expectations.
- The KUBRA acquisition is already showing early success, with $4.5 million in annualized run-rate synergies realized in the first month and a clear path to $8 million by year-end and $20 million-plus by 2028.
- Business Payments segment saw robust 32% reported revenue growth (19% normalized), driven by a 65% year-over-year expansion in the AP supplier network to 731,000 vendors and strong software partner momentum.
- The company is leveraging AI tools to enhance operational efficiency, reallocating over 775 development hours per month, which supports faster integration and innovation.
- Management reiterated full-year 2026 guidance with expected revenue of $490-$500 million and double-digit organic growth in the second half, backed by a strong pipeline and client ramps.
- Free cash flow generation was solid at $27.4 million (75% conversion), and the company is committed to deleveraging to below 3x net leverage within 18 months.
- Organic growth in Consumer Payments was only 4% in Q2, below the company's double-digit target, though management expects acceleration in H2.
- Gross profit margin declined to 70% from 76% year-over-year, primarily due to KUBRA's lower-margin mix, which could pressure profitability in the near term.
- Adjusted EBITDA margin fell to 36% from higher levels, reflecting KUBRA's integration costs and natural mix, with full-quarter impact expected in Q3.
- The company faces significant integration risks with KUBRA, including platform upgrades and client migration, which could disrupt operations if not managed carefully.
- Net leverage increased to 3.7x pro forma, and the company must generate consistent cash flow to meet its deleveraging target, which may limit capital allocation flexibility.
- Political media revenue, while a tailwind, is cyclical and not a sustainable growth driver, with normalized growth (excluding political) at 7-9% for the full year.
Good afternoon. I'd like to welcome everyone to Repay Holdings Corporation's second-quarter 2026 earnings call. This call is being recorded, August 10, 2026.
I'd like to turn the session over to Stewart Grisante, Head of Investor Relations at Repay. Stewart, you may begin.
Thank you. Good afternoon, and welcome to Repay's second-quarter 2026 earnings conference call. With us today are John Morris, Co-Founder and Chief Executive Officer; and Robert Houser, Chief Financial Officer.
During this call, we will be making forward-looking statements about our beliefs and estimates regarding future events and results. Those forward-looking statements are subject to risks and uncertainties, including those set forth in the SEC filings related to today's results and in our most recent Form 10-K. Actual results may differ materially from any forward-looking statements that we make today.
Forward-looking statements speak only as of today, and we do not assume any obligation or
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