Priority Technology Holdings, Inc.

Greetings. Welcome to Priority Technology Holdings' first quarter 2026 earnings call. This time, all participants will be in listen-only mode. The question and answer session will follow the formal presentation. If anyone today should require operator assistance during the conference, please press star zero from your telephone keypad. Please note that this conference is being recorded. At this time, I'll now turn the conference over to Meghna Mehra, Managing Director of ICR. Thank you, Meghna. You may now begin.

Good morning, and thank you for joining us. With me today are Tom Priori, Chairman and Chief Executive Officer of Priority Technology Holdings, and Tim O'Leary, Chief Financial Officer. Before giving our prepared remarks, I would like to remind all participants that our comments today will include forward-looking statements, which involve a number of risks and uncertainties that may cause actual results to differ materially from our forward-looking statements. The company undertakes no obligation to update or revise the forward-looking statements whether as a result of new information, future events, or otherwise. We provide a detailed discussion of the various risk factors in our SEC filings, and we encourage you to review these filings. Additionally, we may refer to non-GAAP measures, including but not limited to EBITDA and adjusted EBITDA during the call. Reconciliations of our non-GAAP performance and liquidity measures to the appropriate GAAP measures can be found in our press release and SEC filings available in the Investors section of our website. Before I turn the call over to Tom, I would like to say that on today's call, we will only be discussing Priority's financial and operational results and outlook. We will not be commenting on or answering questions related to the Special Committee's ongoing evaluation of the Take Private proposal. Please continue to refer to the company's prior press releases for the latest on that topic. With that, I would like to turn the call over to our Chairman and CEO, Tom Priori.

Thank you, Meghna, and thanks to everyone for joining us this morning. I'll cover our aggregate first quarter performance and outlook before handing the call over to Tim, who'll provide segment-level performance, key trends, and developments across our business segments and priority overall. This morning, we reported strong growth in both revenue and profits for the first quarter. As summarized on slide three, priority had a solid Q1 by every key financial metric. growing net revenue by 11%, generating adjusted gross profit and adjusted EBITDA growth of 13% each, and increasing adjusted EPS by 27% year-over-year to $0.28. We ended the first quarter with 1.8 million total customer accounts operating on our commerce platform, which is up 50,000 from the end of 2025. annual transaction volume increased by 3 billion from year end to 153 billion, and average account balances under administration improved by over 100 million from year end to 1.8 billion. Tim will provide more context on the full year outlook later in the call, but I can reflect that the value our diverse partners and customers see in our unified commerce platform and elegant product solutions provides continued confidence that we will sustain the momentum in our merchant solutions, payables, and treasury solution segments. Turning our attention to aggregate Q1 results on slide four, revenue of $249.6 million increased 11% from the prior year. This led to a 13% increase in adjusted gross profit to $98.8 million and a 13% improvement in adjusted EBITDA to $58.1 million. Adjusted gross profit margin of 39.6%, increased 70 basis points from the prior year's first quarter, reflecting the ongoing performance of our diverse high margin payables and treasury solution segments, combined with the accretive impact of acquisitions completed in the second half of 2025. For those of you who are new to priority, slides five and six highlight our vision for connected commerce. The Priority Commerce platform is purpose-built to streamline collecting, storing, lending, and sending money. It delivers a flexible financial tool set for merchant acquiring, payables, and treasury solutions designed to accelerate cash flow and optimize working capital for businesses. I would encourage you to play the short one- to two-minute videos embedded in the product links on the slide to gain a deeper appreciation of why customers are consistently partnering with Priority to reach their commerce goals, and why we're emerging as a go-to solution provider for embedded commerce and finance solutions. Slide six highlights a typical partner experience with our commerce APIs orchestration capabilities for payments and treasury solutions. This enables partners to use a single API tailored to their specific objectives. Customers connecting via API can access all routes for digital payment acceptance, create traditional and virtual bank accounts, issue physical and virtual debit cards, enable lockbox for checks, configure single vendor and advanced bulk vendor payments, and many other commerce options that create new revenue opportunities and operating efficiency. We continue to standardize payment operations and key operational workflows across diverse industry segments where money movement and treasury tools are critical to the value chain to broaden and diversify our revenue sources while maintaining our cost discipline. This vision explains why Priority has consistently performed across varying economic cycles. Our customers in current market conditions, particularly the accelerating narrative of AI's impact on SaaS providers, reinforce our belief that systems connecting payments and treasury solutions to accept and distribute funds in multi-party environments will be critical as businesses put greater demand on software and payment solution providers to deliver a full suite of core business solutions on a single relationship. At this point, I'd like to hand the call over to Tim, who will provide further insights into the health of our business segments along with current trends in each that factored into our first quarter results and our confidence for sustained performance in 2026.