Usio (USIO) investor relations material

Business overview and segments

• Operates three main segments: card issuing (prepaid, Mastercard exclusive), acquiring (credit/debit card processing, ACH), and print/mail services.

• Payment facilitation is the flagship product, sold through software vendors, enabling them to act as processors and share interchange revenue.

• Print/mail division processed 7 million checks for Gap Inc. and serves regulated entities, municipalities, and utilities.

• Apple uses the technology to test wallet capabilities; Mastercard provides frequent referrals.

• Acquired Akimbo (2016) and Output Solutions (2020), expanding capabilities and revenue streams.

Financial performance and growth

• Processed $8.4 billion in payments and 61 million transactions in the last year, with both metrics expected to grow into 2026.

• Reported $85.4 million in revenue last year; Q1 revenue of $25.5 million marked 16% growth over prior year.

• Adjusted EBITDA margin at 3% in Q1, with expectations for margin improvement as scale increases.

• Guidance for 2026 is 10%-12% revenue growth, normalizing for one-time events and customer acquisition losses.

• Strong balance sheet with $7.7 million in operating cash, minimal debt, and increasing settlement fund balances.

Business model and margins

• Payment facilitation earns about $0.25 net per $100 transaction after revenue sharing; highly volume-driven.

• ACH is the highest margin product, earning $0.70 per transaction with up to 70% margins, targeting recurring payments for lenders and institutions.

• Card issuing generates revenue from card creation fees ($0.35-$4), 1%-2% interchange, and 2%-4% spoilage fees, with 30%-40% margins.

• Print/mail earns $0.15-$0.18 per page plus postage margin, with 18%-22% margins; also offers electronic bill presentment.

• Operating leverage allows for significant payment volume growth without major increases in headcount or infrastructure.