Repay Holdings Reports Q2 Growth Despite Challenges

Repay Holdings reported Q2 revenue of $75.6 million, a slight YoY increase, despite a 2% decline in gross profit and a net loss impacted by a $103.8 million goodwill impairment. Adjusted EBITDA was $31.8 million, and free cash flow conversion improved to 71%. The company repurchased 4.8 million shares and expanded its integrated software partnerships and AP supplier network. Repay Holdings remains optimistic about its future, reiterating its 2025 outlook for accelerating growth in the fourth quarter.

Repay Holdings Corp (RPAY) reported its Q2 2025 earnings, revealing a mixed performance with a significant miss on earnings per share (EPS) expectations. The company's actual EPS was -$1.15, a stark deviation from the forecasted $0.20, representing a negative surprise of 675% [1]. Despite the EPS miss, revenue exceeded forecasts, coming in at $75.62 million against a forecast of $73.57 million, a 2.79% positive surprise. The stock saw a 4.08% increase during the regular session but dropped 1.75% in after-hours trading.

The company's revenue grew by 1% year-over-year, while gross profit declined by 2%. Adjusted EBITDA was $31.8 million, with a 42% margin. Free cash flow conversion improved to 71%. The company repurchased 4.8 million shares and expanded its integrated software partnerships and AP supplier network. Key takeaways include a significant EPS miss, a modest year-over-year revenue increase, and strong liquidity with a current ratio of 3.71.

Repay Holdings maintains a robust gross profit margin of 77.03% but has not been profitable over the last twelve months. The company's CEO, John Morris, highlighted the company's core growth strategy and resilient business model, emphasizing the momentum from prior enterprise sales initiatives and the growing network effect.

Looking ahead, Repay Holdings expects sequential quarterly normalized gross profit growth in Q4, with projections of high single-digit to low double-digit growth. The company remains focused on capital allocation priorities, including organic growth and strategic mergers and acquisitions. Despite the EPS miss, the company's strong liquidity and growth prospects suggest potential upside opportunity.

References:
[1] https://www.investing.com/news/transcripts/earnings-call-transcript-repay-holdings-misses-q2-2025-eps-forecast-93CH-4183979