Corpay, Inc. Q4 FY2025 earnings call

• Q4 results: Revenue $1.248 billion, up 21%; cash EPS $6.04, up 13%. New sales/bookings up 29% vs prior year, same-store sales up 1%, revenue retention stable at 92%, cash EBITDA >$700M.
• 2025 highlights: Full year revenue $4.5 billion, up 14%; cash EPS $21.38, up 12%; organic revenue growth 10% for full year. Acquisitions of Alpha, Avid, and second vehicle debt company in Brazil; Mastercard investment in cross-border business.
• 2026 guidance: Full year revenue midpoint $5.265B (+16% y/y), cash EPS midpoint $26 (+22% y/y); drivers include fundamentals, accretive acquisitions (Alpha and Avid contributing ~$300M incremental revenue and $1 cash EPS), and favorable macro.
• 2026 priorities: Further simplify portfolio and accelerate corporate payments rotation; improve U.S. sales, particularly for vehicle payments and lodging solutions; expand payables with new enterprise accounts, UK sales, and new monetization options; enhance cross-border capabilities including multicurrency accounts and stablecoin; implement AI in client UIs, reduce live agent expense, and speed merchant matching.

Corporate Payments delivered 16% organic growth in Q4, with overperformance from Alpha and spend volumes up 44% pro forma to over $81 billion. Cross-border continued strong sales and revenue performance, with Alpha integration progressing and first joint sale with Mastercard. Payables had strong sales performance in Q4, in early stages of market penetration with strategic investment in Avid. Vehicle Payments had 10% organic revenue growth, with strong results in U.S., Europe, and Brazil. Lodging, representing less than 10% of total revenue, decreased 7% year over year, with assumption of low single-digit growth in 2026 with headwinds in the first half.

2026 full year revenue midpoint $5.265B, up over $700M vs 2025; cash EPS midpoint $26, up 22%. Driven by fundamentals (record Q4, good trends), accretive acquisitions (Alpha contributing ~$300M incremental revenue, Alpha-Avid contributing ~$1 cash EPS), and favorable macro (FX rates, SOFR rates, constant tax rate). Guidance does not include impact of divestitures or major capital allocation actions beyond delevering.

Forward-looking statements may differ materially from actual results. Risks include macroeconomic uncertainties, integration challenges of acquisitions, and potential impact of regulatory changes.

Q: Andrew Jeffrey asked about payables monetization and dimensionalizing the initiative.

A: Ron Clarke said they're testing eChecks, debit, and instant payments, expecting impact in Q2/Q3, creating more legs for the business long term.

Q: Andrew Jeffrey followed up on domestic vs Brazil vehicle payment organic growth.

A: Peter Walker said UFCP business had ~5% organic growth in Q4, Europe, rest of world, and Brazil tracked consistently for 10% overall organic growth for vehicle payments.

Q: Darrin Peller asked about sustainability of U.S. Fleet acceleration and modeling.

A: Ron Clarke said sales is the answer, with U.S. vehicle business seeing positive same-store sales for first time in six quarters, and Peter Walker discussed expense rationalization and margin expectations.

Q: Tien-Tsin Huang asked about corporate payments backlog and margins.

A: Ronald F. Clarke said confidence in corporate payments is high, with payables having longer implementation cycles and cross-border having shorter sales to implementation cycles; Peter Walker discussed expense rationalization targeting over $75M of expense out.

Q: Mihir Bhatia asked about lessons from pay by phone and corporate payments priorities.

A: Ronald F. Clarke said lessons include thesis not always perfect but still making return, and discussed timelines for corporate payments priorities like monetization in 2026.

Q: Sanjay Sakhrani asked about divestitures liquidity and lodging.

A: Ronald F. Clarke said two other vehicle businesses in process, use of proceeds for share buybacks, and lodging has stabilized but needs new sales; Peter Walker discussed lodging outlook.

Q: Nate Svensson asked about Alpha overperformance and Mastercard joint sale.

A: Ronald F. Clarke said Alpha integration and people performance better than expected, and Mastercard partnership has strong pipeline and potential long-term impact.

Q: Ramsey El-Assal asked about sales conversion to revenue and stablecoins.

A: Ronald F. Clarke said conversion varies by business (payables slower, cross-border faster), and stablecoin demand is currently low but they're building capabilities.

Q: Rayna Kumar asked about lodging drivers and EBITDA margin.

A: Peter Walker said lodging has low single-digit growth with back half pickup, and EBITDA margins increasing quarter over quarter 2026 but slightly down year over year due to acquisitions.

Q: Trevor Williams asked about organic guide cadence and Brazil growth.

A: Peter Walker and Ronald F. Clarke discussed Q1 organic growth due to float headwinds and Brazil growth sustainability from extended network and Sempra credit card sales.

Q: Michael Infante asked about stablecoin cost compression.

A: Ronald F. Clarke said no current demand seen, rails insignificant in cost structure, and they're staying tuned but not seeing high risk.

Q: David Koning asked about minority interest.

A: Peter Walker said they'd discuss in more detail offline.

Q: Madison Sewer asked about Mastercard partnership upside.

A: Ronald F. Clarke said it's a timing call with large pipeline and potential big contribution if successful