EverCommerce Inc. Q2 FY2025 earnings call

• Strong second quarter results: Revenue exceeded the top end of guidance range, adjusted EBITDA of $45 million beat the top end of guidance range with a 30.4% margin. Adjusted EBITDA margin expanded over 230 basis points year-over-year.
• Vertical focus: EverCommerce focuses on EverPro, EverHealth, and EverWell verticals, with Marketing Technology Solutions classified as discontinued operations.
• Payments and TPV: Payments revenue pro forma grew 6.8% year-over-year, TPV was approximately $12.9 billion, nearly 7% year-over-year growth. Higher TPV growth at top solutions, offset by lower growth in legacy payment products.
• Credit facility: Repriced and extended credit facility in July, increasing financial flexibility and resulting in approximately $1.3 million in annual interest savings.
• Customer base: Over 725,000 customers across verticals. Annualized net revenue retention was 97% in the trailing 12 months.

EverCommerce has three major verticals: EverPro, EverHealth, and EverWell. The second quarter revenue was $148 million, up 5.3% year-over-year. On a pro forma basis, subscription and transaction revenue grew 7.4% year-over-year. Adjusted EBITDA was $45 million, which beat the top end of the guidance range, representing a 30.4% margin. Adjusted EBITDA margin expanded more than 230 basis points year-over-year. Payments revenue, excluding fitness solutions, grew 6.8% year-over-year. On a pro forma basis, for the last 12 months, revenue was $574.1 million, representing 7.9% year-over-year growth. Subscription and transaction revenue grew 8.1% year-over-year. Payments revenue on a pro forma basis grew over 6.8% and accounted for approximately 21% of overall revenue. The annualized total payments volume (TPV) expanded to approximately $12.9 billion, a nearly 7% year-over-year growth. EverPro and EverHealth verticals represent 95% of consolidated revenue.

• Third quarter 2025: Expected total revenue of $146.5 million to $149.5 million and adjusted EBITDA of $41 million to $43 million.
• Full year 2025: Expected total revenue of $581 million to $601 million, and adjusted EBITDA increased to a range of $171 million to $177 million.

Q: Congrats on the strong quarter. Can you give a state of the union on where you are in terms of your transformation initiatives and how you guys think you're progressing against that?

A: When talking about transformation optimization, it's ongoing. Many are looking for opportunities in optimization to gain more margin. Focused on creating more energy and focus within BUs and verticals like EverHealth and EverPro. CEOs Evan Berlin and Josh McCarter are building out organizations and teams, seeing positive results in efficiency and sales/marketing efficiency.

Q: Congrats on another good quarter. Circling back on the revenue guide. You beat expectations on the top line for now 2 straight quarters and you maintained the full year guide. Any thoughts on deals pulled into the first half or anything for the second half?

A: First half of the year was strong, didn't pull in anything unusual from a revenue perspective in Q1 or Q2. Do a bottoms-up build, look at different factors within solutions. Feels like what we're guiding towards is appropriate for Q3 and Q4 with prudence.

Q: Given the Circle IPO in June and all the subsequent investor attention that's gone into understanding the potential of stablecoins to affect payments revenue streams, how do you think about the potential for stablecoins to affect take rate or method of payment in your service-based SMB customer base over the medium and long term, if at all?

A: In terms of focusing on stablecoins and how it's going to affect current payment methods, that is not currently on the road map. We provide many ways for customers to get paid, and to date, there's been 0 requests for things of that nature. Will be responsive to the marketplace if and when that happens, but not on the short-term or midterm road map currently.

Q: Can you talk about the improved visibility you have into the business as a result of the Mar Tech discontinuation and eventual divestiture when giving us guidance now?

A: From a visibility perspective, taking out Mar Tech from continuing operations makes it much more linear. There's very little seasonality. It continues to refocus where everyone is spending time and effort on EverPro, EverHealth, and EverWell. Continue with optimization efforts, intend to take costs out on an optimized basis to make continued investments for revenue expansion.