Paysafe (PSFE) Q3 2024 earnings summary

Executive summary

• Revenue grew 8% year-over-year to $427 million in Q3 2024, with merchant solutions up 11% and digital wallets up 4%.

• Adjusted EBITDA rose 1% to $117.8 million, with margin expanding 70 basis points from Q1 2024.

• Net leverage improved to 4.7x from 5.0x at year-end 2023, reflecting debt repayments and EBITDA growth.

• Full-year 2024 outlook reaffirmed, with revenue guidance of $1,713–$1,729 million and adjusted EBITDA of $471–$484 million.

• Portfolio optimization and hiring initiatives completed ahead of schedule, with strong eCommerce and iGaming growth.

Financial highlights

• Total payment volume reached $38 billion, up 8% year-over-year; take rate steady at 1.1%.

• Adjusted net income was $31.4 million; adjusted EPS was $0.51, down from $0.57 last year due to higher tax expense.

• Unlevered free cash flow was $89.9 million in Q3, with a 68% conversion rate.

• Net debt decreased by $39 million sequentially; $25 million remains in the share repurchase program.

• Gross profit (excluding depreciation and amortization) increased to $249.0 million from $232.3 million year-over-year.

Outlook and guidance

• 2024 revenue guidance: $1,713–$1,729 million, above initial guidance.

• Adjusted EBITDA guidance: $471–$484 million, margin 27.5%-28%.

• Net leverage expected to remain between 4.6x and 4.7x at year-end.

• FX sensitivity: every 1% euro weakening impacts revenue by $6–$8 million annually.

• Management expects continued momentum into 2025.