CPAY · Q4 2025 Earnings

Bullish

Corpay

Reported February 4, 2026

30-second summary

30-second take: Q4 revenue grew 21% YoY to $1.248B with 11% organic growth, driven by Corporate Payments revenue +39% (16% organic) and Vehicle Payments +15%; non-GAAP EPS came in at $6.04 and full-year EPS at $21.38 on $4.528B of FY revenue (+14%). Management initiated 2026 guidance of $5.215–5.315B revenue (+16% YoY at midpoint) and $25.50–26.50 adjusted EPS (+22% YoY at midpoint), with Q1 organic growth guided to 9% — below the full-year 10% — explicitly because of float compression from lower SOFR. The print confirms the portfolio rotation thesis from Q2: Corporate Payments is now the growth engine, Alpha/Avid integrations are tracking ahead, and lodging has stabilized into low-single-digit territory rather than being divested.

Headline numbers

EPS

Q4 FY2025

$6.04

Revenue

Q4 FY2025

$1.25B

+21.0% YoY

Operating margin

Q4 FY2025

45.2%

Key financials

Q4 FY2025

Metric	Q4 FY2025	YoY
Revenue	$1.25B	+21.0%
EPS	$6.04	—
Operating margin	45.2%	—

Guidance

Flywire initiates comprehensive FY2026 guidance: 16% revenue and 22% EPS growth driven by organic expansion across segments and realized deal synergies.

Guidance is issued for the full year only, refreshed each quarter. Prior and new below are the same FY updated this quarter.

New guidance

Metric	Period	Guide	YoY
Revenue	FY2026	$5.215 billion to $5.315 billion	16% YoY
Adjusted EPS	FY2026	$25.50 to $26.50	22% YoY
Organic Revenue Growth	FY2026	10% at the midpoint	—
Net Interest Expense	FY2026	$370 million to $400 million	—
Adjusted Effective Tax Rate	FY2026	25% to 27%	—
Fully Diluted Shares Outstanding	FY2026	Approximately 70 million	—
Revenue	Q1 FY2026	$1.19 billion to $1.23 billion	—
Adjusted EPS	Q1 FY2026	$5.33 to $5.57	21% YoY
Organic Revenue Growth	Q1 FY2026	9% at the midpoint	—
Corporate Payments Organic Revenue Growth	FY2026	Mid-teens	—
Vehicle Payments Organic Revenue Growth	FY2026	High single digits	—
Lodging Organic Revenue Growth	FY2026	Low single digit	—

Segment performance

Q4 FY2025

Segment	Q4 FY2025	YoY
Vehicle Payments	$0.573B	+15.0%
Corporate Payments	$0.481B	+39.0%
Lodging Payments	$0.113B	-7.0%
Other	$0.082B	+18.0%
Corporate Payments Organic Growth	16%	—

Capital & returns

Q4 FY2025

Segment	Q4 FY2025
Share Repurchases	$500M (1.7M shares)

Other KPIs

Q4 FY2025

Segment	Q4 FY2025
Organic Revenue Growth	11%
Adjusted EBITDA	$712.4M
Adjusted EBITDA Margin	57.1%
Vehicle Payments Transactions	221.9M
Corporate Payments Spend Volume	$81.4B
Lodging Payments Room Nights	7.9M

Management tone

Narrative arc: Q2 portfolio rotation under pressure → Q3 capacity-building credit amendment → Q4 portfolio rotation paying off / macro flips to tailwind.

Macro framing flipped from headwind to "friend." One quarter ago lodging was being put on a divestiture clock and management was hedging on tariffs and SOFR; this quarter Ron Clarke said "we are expecting the macro to be our friend, to be helpful here in 2026" with explicit mentions of favorable FX (particularly H1), lower SOFR, and tax rates. The anthropomorphizing language is unusual for a payments processor — peers typically embed macro optimism in numbers rather than calling it out. The shift signals management is willing to attach the 2026 guide credibility to external conditions, which makes the 22% EPS growth target more exposed to a SOFR or FX reversal than the prior cadence suggested.

Lodging moved off the divestiture clock. In Q2, Clarke said lodging "either gets fixed and it gets growing or it goes." This quarter the framing softened to "while clearly not recovering, progress continues" with low-single-digit growth assumed for 2026 and a return to positive organic in H2. The 60%+ EBITDA margin disclosure in Q&A is also new — management is now anchoring on profitability rather than growth as the retention rationale. The implicit signal: divestiture timeline has been pushed out, and the 10% organic "floor" introduced in Q2 has been relaxed for this asset.

AI moved from absent to operational. AI did not appear in the Q2 narrative. This quarter Clarke said "we have gotten religioned around AI," with conversational AI in pilot across client UIs and AI agents already reducing live-agent expense in the lodging business. "Religioned" is a colloquial signal of cultural alignment, not a press-release pilot announcement — and the deployment is being used to defend lodging margins specifically.

Portfolio rotation now has a defined exit schedule. Q2 framed divestitures as "two non-core vehicle businesses formally on the block" with proceeds targeted to fund Alpha. This quarter management disclosed a signed Pay by Phone agreement closing in Q2 2026, plus two more vehicle divestitures in late-stage process with $1B–$1.3B combined proceeds expected within 30 days, all earmarked for CPAY share repurchases at current pricing. The capital-allocation thesis has tightened from "fund Alpha" to "fund Alpha and shrink the share count."

Cross-border via the MasterCard channel went from "first joint sale" to a 50–70 opportunity pipeline. Q2 disclosed the partnership signing; Q4 disclosed two closed joint sales (ahead of the "one" mentioned in prepared remarks) and 50–70 opportunities in process, concentrated in Europe. This is the clearest evidence of revenue-synergy realization from the strategic pivot articulated last quarter.

Recurring themes management leaned on this quarter:

organic growth consistency (10% for 4 of last 5 years)corporate payments rotation and accelerationM&A integration delivering accretion (Alpha, Avid)sales momentum and bookings strength (29% growth)macro tailwinds materializing (FX, SOFR, tax rates)portfolio simplification and non-core divestitures

Risks management surfaced:

Float revenue compression from lower interest rates (200 bps drag in Q4)Lodging business headwinds continuing in H1 2026Trade-related uncertainty (mentioned as headwind despite resilience)Material weakness remediation (now resolved)Execution risk on multiple divestitures and integrations

Q&A highlights

Andrew Jeffrey · William Blair

Asked about payables monetization initiatives, specifically around e-check and non-check-based payments, timeline for yield improvement, and whether this could add to segment organic revenue growth.

Management indicated they are moving away from reliance on virtual cards for monetization by offering multiple payment methods (e-checks, debit, ACH+, instant payments). Expects impact in Q2-Q3 2025. Noted that merchants prefer choice and some will accept these methods where they won't accept virtual cards.

Q2-Q3 2025 expected timeline for monetization impactMultiple payment method options being tested: e-checks, debit, ACH+, instant paymentsResearch shows merchant preference for payment choice

Darren Peller · Wolf Research

Asked about sustainability of double-digit vehicle payment growth, particularly U.S. vehicle acceleration, and what's needed to push same-store sales meaningfully higher. Also asked about cadence of acquisition contribution and interest expense outlook.

Management noted U.S. vehicle business has stabilized with positive same-store sales for first time in 6 quarters, stable retention, and higher approval rates. Primary driver for growth acceleration is sales. On acquisitions, expects $1B in EBITDA accretion from Avid/Alpha deals in 2026 with biggest unlock coming in H2 from IT system sunset. Interest expense to decline due to $1.8B annual cash flow and favorable SOFR curve.

U.S. vehicle same-store sales positive for first time in 6 quartersApproval rates up, credit good in U.S. vehicle$1B EBITDA accretion target from Avid/Alpha dealsH2 2025 IT system sunset unlock expected

Tenjin Wang · JP Morgan

Asked about mid-teens corporate payments growth expectations, backlog visibility, room for upside, and margin impact from expense rationalization.

Management confirmed mid-teens growth with strong confidence. Payables business has good sales due to longer implementation cycle creating visibility. Cross-border has faster sales-to-implementation and rocking sales, though float compression (particularly from Alpha integration) is a near-term headwind. Targeting $75M expense reductions ($50M executed), with margins climbing sequentially as fixed cost base benefits from revenue growth.

Mid-teens corporate payments growth guidance26% growth referenced for full segment$75M expense reduction target (50% executed)3-4 points of margin expansion from Q1 to Q4 sequentially

Nate Svensson · Deutsche Bank

Asked about Alpha outperformance drivers, revenue synergies, organic growth contributions, and details on first MasterCard joint sale partnership results and pipeline.

Management attributed Alpha outperformance to cultural integration and sales team embrace of parent company's products and credit capabilities. Already closed 2 MasterCard joint sales (not just 1). MasterCard partnership showing exceptional early results with 50-70 opportunities in process, particularly strong in Europe. Partnership thesis of combining MasterCard's relationships with company's products proving successful.

2 MasterCard joint sales closed (exceeded expectations)50-70 MasterCard partnership opportunities in processStrong Europe concentration in MasterCard pipelineAlpha integration performing ahead of expectations

Sanjay Sakrani · KBW

Asked about liquidity from Pay by Phone divestiture and other pipeline divestitures, expected proceeds, use of funds, and drivers for turning around lodging business.

Management indicated two other vehicle businesses in late-stage process, with combined proceeds of $1B-$1.3B expected within 30 days. All proceeds from divestitures earmarked for corporate payments acquisition (CPAY) purchases at current pricing. Lodging business has stabilized on same-store sales (flat) after fixing IT, product, and customer issues, similar to U.S. vehicle trajectory. Primary growth driver now is new sales; business generates 60%+ EBITDA margins.

Two vehicle businesses being divested in late-stage process$1B-$1.3B expected proceeds from pipeline divestituresDivestiture proceeds designated for CPAY purchasesLodging same-store sales stabilized (flat)

Answers to last quarter's watch list

Use of proceeds from the Seventeenth Amendment ($900M Term B-6 + $1.0B incremental revolver). Management framed the 2026 outlook around realized Alpha and Avid synergies and disclosed $7.7B year-end debt against $1.8B annual cash flow generation, with interest expense guided to decline to $370–400M in 2026. The capacity action from November now reads as Alpha acquisition financing plus general liquidity for the cross-border ramp. Status: Resolved positively

Pro forma leverage after $1.9B incremental capacity. Net interest expense guidance of $370–400M for 2026 (below trailing run-rate implied by the new debt stack) suggests management expects organic deleveraging plus favorable SOFR. No covenant stress signaled and the combined Alpha+Avid contribution is tracking to ~$1 of cash EPS accretion. Status: Resolved positively

Lux 2 Luxembourg legal opinion delivery. Not addressed on the print; an operational technicality that did not surface in 2026 guidance commentary or Q&A. Status: Continue monitoring

What to watch into next quarter

Q1 organic growth print vs. 9% guide. The 9% vs. FY 10% gap is attributed entirely to float compression — a Q1 print materially below 9% would imply business deceleration, not just SOFR drag.

Pay by Phone close and the two other vehicle divestitures. Management told KBW $1B–$1.3B in proceeds would clarify within 30 days; watch the announcement structure and the share-repurchase pace, since the 2026 guide excludes buybacks and shares-out is guided to ~70M flat.

MasterCard pipeline conversion. 50–70 opportunities in process and 2 closed — watch whether the conversion rate produces incremental revenue commentary by mid-2026 or whether the pipeline stalls.

Corporate Payments organic growth holding at mid-teens through 2026. Q4 printed +16% organic; mid-teens for the full year implies modest deceleration. Watch whether float drag is contained to 1–2 points or expands.

Lodging same-store sales trajectory and the H2 inflection. Management's "back half returns to positive organic" call requires same-store to turn from -7% to flat-to-positive by Q3. If H1 prints worse than low-single-digit decline, the divestiture conversation reopens.

AI cost-takeout disclosure. "Religioned around AI" with live agent reduction in lodging — watch for quantified opex impact in 2026 quarterlies, since management is anchoring lodging retention on margin rather than growth.

Sources

Corpay Q4 2025 Press Release (Form 8-K Ex. 99.1), SEC filing dated 2026-02-04: https://www.sec.gov/Archives/edgar/data/1175454/000117545426000008/ex991q4_2025.htm
Corpay Q4 2025 earnings conference call commentary and Q&A (referenced via transcript extraction)

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