Shift4 Payments 2025 Q1 Earnings Net Income Declines 31.6%

Shift4 Payments (FOUR) reported its fiscal 2025 Q1 earnings on Apr 29th, 2025. The company missed analyst expectations for earnings per share, reporting $0.24 versus the anticipated $0.71. Despite this, Shift4 Payments raised its guidance for the full year, projecting gross revenue less network fees to grow between 23% and 28%. The company also anticipates adjusted EBITDA to increase by 24% to 28%, supported by stable consumer spending trends and resilience in various economic conditions.

Revenue
Shift4 Payments saw a 19.9% rise in total revenue, reaching $848.30 million in Q1 2025, compared to $707.40 million in Q1 2024. Payments-based revenue significantly contributed to this growth with $755.70 million, while subscription and other revenues added $92.60 million, culminating in the impressive total of $848.30 million.

Earnings/Net Income
Shift4 Payments's EPS fell by 22.6% to $0.24 in Q1 2025 from $0.31 the previous year. Net income also declined significantly to $19.50 million, representing a 31.6% decrease from $28.50 million in Q1 2024. This indicates a challenging earnings period for the company.

Price Action
The stock price of Shift4 Payments edged up by 2.11% during the latest trading day, surged 16.70% over the most recent full trading week, and climbed 3.91% month-to-date.

Post-Earnings Price Action Review
The recent earnings report positively impacted Shift4 Payments' stock price, resulting in a maximum return of 2.60% over the backtested period. This suggests that the company's earnings metrics, including revenue, net income, and EPS, can favorably influence its stock price. The positive returns observed imply that Shift4 Payments, along with other market participants, benefits from favorable earnings metrics, enhancing investor confidence.

CEO Commentary
Taylor Lauber, Incoming CEO, emphasized that Shift4 Payments is thriving despite economic uncertainty, attributing strong Q1 results to a 35% year-over-year volume increase to $45 billion and a gross revenue growth of 40%. He noted the importance of their M&A strategy, cross-selling capabilities, and a solid foundation built on existing customers. Lauber highlighted strategic priorities such as expanding merchant relationships, unlocking synergies from acquisitions, and ensuring international growth. He stated, “We thrive in times of uncertainty,” reflecting an optimistic outlook as they continue to execute on established strategies while remaining cautious about external factors.

Guidance
Shift4 Payments raised its full-year guidance for gross revenue less network fees to between $1.66 billion and $1.73 billion, reflecting 23% to 28% growth. Adjusted EBITDA is now expected to be between $840 million and $865 million, representing 24% to 28% growth. For Q2, the company anticipates gross revenue less network fees between $405 million and $415 million with adjusted EBITDA margins around 50%. The outlook is supported by stable consumer spending trends and the expectation of continued resilience in various economic conditions.

Additional News
Shift4 Payments has been actively engaging in mergers and acquisitions, recently extending its tender offer to acquire Global Blue, a strategic move aimed at enhancing cross-selling opportunities and expanding its market presence. Additionally, Taylor Lauber has taken over as the new CEO, bringing fresh leadership to guide the company's growth and international expansion efforts. Furthermore, Shift4 Payments announced a partnership with Great Wolf Resorts, expanding its role as their global payments provider, underscoring its strategy to strengthen merchant relationships and leverage new business opportunities.