Repay Holdings Corp. (RPAY) - Q3 2025 10-Q Summary
Business Context and Reporting Period
This filing covers the quarterly period ended September 30, 2025. Repay Holdings Corporation operates as a payment processing solutions provider serving vertical markets through two reportable segments: Consumer Payments (approx. 85% of revenue) and Business Payments (approx. 15% of revenue). The company is headquartered in Atlanta, Georgia, and trades on the NASDAQ under the symbol RPAY.
Key Financial Metrics
| Metric | Q3 2025 (3 Months) | Q3 2024 (3 Months) | YTD 2025 (9 Months) | YTD 2024 (9 Months) |
|---|---|---|---|---|
| Revenue | $77.7 million | $79.1 million | $230.7 million | $234.8 million |
| Net Income (Loss) | ($6.6) million | $3.2 million | ($122.8) million | ($6.4) million |
| Net Loss Attributable to Company | ($6.4) million | $3.2 million | ($116.6) million | ($6.0) million |
| Diluted EPS | ($0.08) | $0.03 | ($1.34) | ($0.07) |
| Adjusted EBITDA | $31.2 million | $35.1 million | $96.2 million | $104.3 million |
| Cash & Equivalents | $95.7 million | $189.5 million (Dec 2024) | Restricted Cash: $46.2 million | |
| Total Debt (Carrying Value) | $425.8 million | $496.8 million (Dec 2024) | Includes $146.3M current maturities | |
| Operating Cash Flow (YTD) | $67.8 million | $115.8 million |
Material Changes vs. Prior Period
- Revenue Decline: Total revenue decreased 1.8% QoQ and 1.7% YTD compared to 2024. The decline is attributed to client losses and the absence of political media spending seen in Q3 2024 due to the election cycle, partially offset by new client growth.
- Goodwill Impairment: The company recognized a non-cash impairment loss of $103.8 million for the nine months ended September 30, 2025. This was primarily driven by a $103.2 million impairment in the Consumer Payments segment due to a decline in stock price, changes in discount rates, and lower comparable company multiples.
- Debt Reduction: The company repurchased $73.5 million of its 2026 Convertible Senior Notes in August 2025, resulting in a $1.4 million gain on extinguishment. Total debt carrying value decreased from $496.8 million at year-end 2024 to $425.8 million.
- Operating Expenses: Selling, general, and administrative (SG&A) expenses decreased 4.1% QoQ and 3.7% YTD, largely due to reductions in equity compensation expenses.
Guidance, Outlook, and Risks
- Outlook: Management expects cash flow from operations, current cash, and available borrowing capacity ($250 million revolver) to be sufficient to fund operations and debt service for the next 12 months and the following five years.
- Share Repurchases: The Board increased the share repurchase program authorization to $75 million. As of September 30, 2025, approximately $23.0 million remains available. The company repurchased 3.1 million shares for $15.6 million in Q3 2025.
- Tax Receivable Agreement (TRA): The company holds a TRA liability of $197.6 million. Changes in the fair value of this liability (driven by accretion and discount rate changes) significantly impact reported net income but are excluded from Adjusted EBITDA.
- Risks: Key risks include exposure to economic conditions affecting consumer loan markets, regulatory changes in payment processing, and the ability to execute growth strategies. The company noted that the impact of the "One Big Beautiful Bill Act" (OBBBA) tax reform is currently not expected to be material to the 2025 effective tax rate.
Investor Verification Checklist
- Impairment Drivers: Verify the specific assumptions used in the discounted cash flow and market comparable methods that led to the $103.2 million goodwill impairment in the Consumer Payments segment.
- Client Concentration: Assess the impact of "previously announced client losses" mentioned in the MD&A on future revenue stability.
- Debt Maturity Wall: Confirm the refinancing strategy for the remaining $146.5 million of 2026 Notes maturing in February 2026.
- TRA Liability: Monitor the Early Termination Rate (currently 5.96%) and its impact on the $197.6 million TRA liability valuation.
- Non-GAAP Reconciliations: Review the reconciliation of Net Loss to Adjusted EBITDA ($31.2M) and Adjusted Net Income ($18.2M) to understand the magnitude of non-cash adjustments relative to GAAP losses.