Record Revenue and Strong Top-Line Growth
Q1 revenue of $358.4M, up 30.2% year-over-year, a company record and above prior expectations.
Paymentus Holdings
· PAY
May 4th, 2026
Summary
- Earnings Call Date:
- 2026-05-04
- Change Since:
- -24.07%
- Next Earnings Date:
- 2026-08-10
Earnings Call Sentiment
PositiveThe call presented strong, broad-based operational and financial outperformance: record revenue, accelerating transaction growth, materially higher adjusted EBITDA, improved per-transaction economics, raised full-year guidance, a healthy balance sheet with no debt, and the launch of a potentially transformative, patented AI-native product (Billio/Bill Wallet) with early organic traction. Near-term challenges include contribution margin compression from mix shifts, higher operating expenses as the company invests in growth, temporary free cash flow pressure due to working-capital timing, modest Q2 conservatism tied to seasonality and onboarding timelines, and ongoing interchange expense exposure that management aims to monetize over time. Overall, the positives substantially outweigh the manageable near-term headwinds.
Company Guidance
Management raised guidance after a strong Q1 beat and provided detailed metrics: Q1 revenue $358.4M (+30.2% YoY), contribution profit $109.7M (+25.2%), adjusted EBITDA $42.4M (+41.5%) with an adjusted EBITDA margin of 38.7% (adjusted EBITDA was 38.7% of contribution profit, +450 bps YoY), transactions 203.4M (+17.4%), average revenue per transaction $1.76 (vs $1.59, ≈+11%), contribution profit per transaction $0.54 (vs $0.51), adjusted gross profit $92.4M (+27.3%), non‑GAAP OpEx $53.0M (+16.3%), non‑GAAP net income $26.9M ($0.21/sh, +50% EPS YoY), cash $342.1M, free cash flow $20.9M, DSO 29 days, working capital $365.4M, no debt and 129.3M diluted shares. Guidance: Q2 revenue $340M–$350M, contribution profit $108M–$111M, adjusted EBITDA $38M–$40M (Q2 Rule of 40 implication 51–55); full‑year 2026 revenue $1.425B–$1.440B (midpoint ≈+19.7% YoY), contribution profit $450M–$457M (midpoint ≈+17.4%), adjusted EBITDA $165M–$172M (midpoint ≈+22.6%), full‑year Rule of 40 53–56, non‑GAAP tax rate 25%—management emphasized prudence around seasonality and onboarding despite strong bookings, backlog and pipeline and reiterated long‑term targets of ~20% revenue growth and 20–30% adjusted EBITDA growth.
Robust Profitability Expansion
Contribution profit of $109.7M, up 25.2% YoY, and adjusted EBITDA of $42.4M, up 41.5% YoY with an adjusted EBITDA margin of 38.7% (record).
Healthy Transaction Growth and Mix Improvement
Processed 203.4M transactions, up 17.4% YoY; average revenue per transaction rose ~11% to $1.76 (from $1.59), and contribution profit per transaction improved to $0.54 from $0.51.
Strong Rule of 40 and Efficiency Metrics
Rule of 40 was 64 for the quarter (vs. 61 in Q4), reflecting solid balance of growth and profitability; incremental adjusted EBITDA margin ~56%.
Raised Full-Year 2026 Guidance
Full-year revenue guidance raised to $1.425B–$1.440B (midpoint ≈ 19.7% YoY growth); contribution profit guidance $450M–$457M; adjusted EBITDA guidance $165M–$172M (midpoint ≈ 22.6% YoY growth).
Strong Cash Position and No Debt
Cash & cash equivalents at $342.1M (up from $324.5M sequentially), free cash flow of $20.9M in Q1, and zero debt, supporting financial flexibility and M&A optionality.
Broadening Customer Base and Pipeline
Signed new clients and channel partners across utilities, insurance, telecommunications, government, property management, consumer finance, banking, education, and health care; sizable backlog and robust pipeline supporting future visibility.
Strategic AI-Native Product Launch with Early Traction
Launched patented AI-native service commerce suite (Billio and Bill Wallet). Early rollout to ~100k users across >1,000 cities with high conversion and no marketing spend; Bill Wallet claimed to reduce payment time by ~75% and creates potential to monetize interchange over time.
Operator
Good day, and welcome to the First Quarter 2026 Paymentus Holdings, Inc. Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. To ask a question during the session, please press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, press star 11 again. Please be advised that today’s conference is being recorded.
I would now like to hand the conference over to your speaker, David Hanover, Investor Relations. Please go ahead.
David Hanover
Thank you, Operator. Good afternoon. Welcome, and thank you for joining the webcast to review our first quarter 2026 results. Our earnings release documents are available on the Investor Relations section of paymentus.com. They include the earnings presentation that we will reference during this webcast. This webcast is being recorded. I hope everyone has had a chance to review those documents. Our founder and CEO, Dushyant Sharma, will make some opening remarks before Sanjay Kalra discusses the details of the first quarter and our guidance.
Following our prepared remarks, we will take questions. Let me remind you we will make forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, and we will refer to non-GAAP financial measures during this webcast. Forward-looking statements are based on management’s current expectations and assumptions that are subject to risks and uncertainties. Factors that may cause our actual results to differ ...
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