Shift4 Payments, Inc.

Greetings. Welcome to the shift for first quarter 2025 earnings conference call. At this time, all participants are in listen-only mode. The question and answer session will follow the formal presentation. If anyone today should require operator assistance, please press star zero from your telephone keypad. As a reminder, this conference is being recorded. It's now my pleasure to introduce Tom McCohen. Thank you, Tom. You may now begin your presentation.

Thank you, operator, and good morning, everyone, and welcome to Shift4's first quarter 2025 earnings conference call. With me on the call today are Taylor Lauber, our president and incoming CEO, and Nancy Disman, our chief financial officer. This call is being webcast on the investor relations section of our website, which can be found at investors.shift4.com. Today's call is also being simulcast on Xspacers, formerly known as Twitter, which can be accessed through our corporate Twitter account at Shift4. Our quarterly shareholder letter, quarterly financial results, and other materials related to our quarterly results have all been posted to our IR website. Our call and earnings materials today include forward-looking statements. These statements are not guarantees of future performance, and our actual results could differ materially as a result of certain risks, uncertainties, and many important factors. Additional information concerning those factors can be found in our most recent reports on Forms 10-K and 10Q, which you can find on the SEC's website in the investor relations section of our corporate website. For any non-GAAP financial information discussed on this call, the related GAAP measures and reconciliations are available in today's quarterly shareholder letter. With that, let me turn the call over to Taylor.

Thanks, Tom, and good morning, everyone. We had another busy quarter, and it was great to see many of you at our recent Investor Day event in February. This morning, I'll provide thoughts on our first quarter results, key priorities that give us confidence in the years ahead, and an update on our recently announced acquisition of Global Blue. I will then turn the call over to Nancy for a detailed review of our quarterly results and our upcoming guidance. Before providing the financial metrics, I wanted to provide some grounding on the growth drivers within the business, which are especially important during times of economic uncertainty. We have strong product offerings across several large markets and are generally number one in each, with the exception of restaurants where we are strong number two. We had world-class customers in each of these verticals, such as Aspen Hospitality, the Satay Hotels, Pittsburgh Pirates, Colorado Rockies, Formula One Miami Grand Prix, and the PGA Tour. We also refused to leave our success to chance. As such, our M&A strategy has afforded us a massive collection of customers whereby we can cross-sell our services. the Boston Red Sox, Herberber Bakeries, and the Ace Hotel Toronto are just three examples of this strategy in action, although there are many more, and we've highlighted a few of them in our materials, which you can find on our website. Interestingly, though, these recent wins will matter more in the years ahead, as the largest contributor to our current performance is generally the wins of last year fully seasoning. Those of you who can recall Jared reading what seemed like a yellow page's worth of wins from last year's earnings calls are now seeing the fruits of that in our results. As such, we posted strong Q1 results that were largely in line with our expectations and are raising our full year 2025 guidance to reflect our confidence in our ability to execute. Some highlights. Our volumes increased 35% year over year to 45 billion. Quarterly volumes were in line with our expectations with year over year growth modestly impacted by the timing of leap year and the Easter holiday. We witnessed stable volume trends across all of our end markets and continue to monitor trends closely in light of the recently implemented trade policies. It should come as no surprise that we never count on an improving economy to drive our success. Gross revenue less network fees increased 40% to $369 million. A combination of stable spreads and subscription and other revenue resulted in our net revenue growing faster than our volumes. We are unlocking significant value from our recent acquisitions, and I will provide some additional details on that topic in a few minutes. Adjusted EBITDA increased 38% to 169 million. We delivered 46% adjusted EBITDA margins, which were modestly above our guidance of 45%. Nancy will comment on our forward margin profile a bit later during the call. And lastly, we delivered adjusted EPS of $1.07 per share. We were pleased with these results and are very excited to execute on our priorities for the balance of the year. I think it's important to note that these priorities are not new, but rather a continuation of what has made us successful for the past 26 years. Our first priority is to keep doing what's made us so successful in the first place. In the US, we are focused on adding new merchants while simultaneously expanding our share of wallet. In restaurants, we continue signing up new merchants onto our SkyTab offering, and also introduce Skytap Air, our latest handheld device that's going to be launching in the next few weeks. It's something we're quite proud of, and I'd encourage you all to take a look at our shareholder letter for some details on it. I gave a few examples of wins earlier, but the product is scaling nicely across a variety of environments. For example, we signed all U.S. locations of Nando's, a fast-growing quick service chicken chain that is expanding quickly in North America with plans to reach over 500 U.S. locations over time. This is replicating its enormous success already in the United Kingdom and elsewhere. In hospitality, we continue to add net new hotels and resorts while simultaneously cross-selling our payments to hotels operating on our gateway. I mentioned Aspen Hospitality and the Satay Hotels earlier, but there are dozens of examples ranging from boutiques like the Nantucket Hotel to large resorts such as the Cooper in Charleston, South Carolina. In stadiums, we are keeping our eye on the ball, puck, et cetera, across all major professional leagues. and are partnering with organizations beyond the four major sports leagues. To that end, and I mentioned this earlier, we've signed the Formula One Miami Grand Prix and the PGA Tour, but also the Red Rocks Amphitheater. Our second priority is unlocking synergies from acquisitions such as Revel, Givex, and Eigen. We are already making progress across all of our recent deals, with each effectively following the Shift4 playbook to a tee. Across just these three most recent acquisitions, we have already achieved more than 20 million in EBITDA synergies in the first quarter. Deals from many years ago also continue to bear fruit, as I cited in some of the cross-sells that I mentioned earlier. As a reminder, our playbook is focused on identifying a unique capability critical to the commerce experience, which we then bundle with our payment processing expertise. We are not buying a company simply to do the same thing as us and then drive cost synergies by removing overlaps. Instead, we unlock meaningful recurring payment revenue by bundling our own payment capabilities with the unique and scarce technology capability we now own. Once we own this new capability and the talent involved in building it, we are inherently more competitive and win more new business in addition to the embedded cross-sell. Some examples of this in action are Revel, which we acquired in June of last year. Revel already has a robust payments cross-sell funnel with over 7,000 locations going live on Shift4 payments as of the Q1 close. Of note, many of these are chains, which was a segment of the restaurant market that was a unique strength of Revel. We have already incorporated many of these Revel capabilities into Skytab, which make it naturally more competitive and enterprise. We have also integrated the product teams from Eigen into Shift4. As a reminder, Eigen is a payment gateway we acquired in November of last year with a presence in Canada and the United States. We have already cross-sold payments to approximately 100 large Eigen gateway-only customers and are making significant progress on combining the gateways into a single one and deleting the Eigen part. The talent that built Eigen now helps us execute on our platform roadmap much more quickly. It should come as no surprise that the gift and loyalty capabilities from Givex are in the process of being fully integrated in SkyTab as our default offering. And we have cross-sold payments to approximately 100 Givex merchants since we've officially launched our cross-sell efforts just in February. We will also delete a part as Givex gift and loyalty capabilities were far superior to our native offerings. As a reminder, we acquired Givex just a few months ago in November of last year. Last but not least is executing on our near-term strategy while also thinking about the future. By taking what has made us successful for 26 years and replicating it all over the world, we can set ourselves up for success for decades to come. As we shared at our recent Investor Day, we are currently operating in six continents, up from only one less than two years ago. We recently unlocked Latin America and are already in the process of signing marquee enterprise clients in that region. In Europe, where tightly bundled software plus payment solutions are less common, we are making tremendous progress signing up restaurants, particularly in the UK, Ireland, and Germany. Our momentum has picked up significantly this year. We're now signing up over 1,000 restaurants a month internationally. These are the priorities that I believe will ultimately enable us to deliver on our financial commitments we made to you all and to drive meaningful, profitable growth over the medium term. Before turning the call over to Nancy, I thought I'd provide a quick update on GlobalBlue. For those of you that possibly missed our February announcement, GlobalBlue is a market-leading payment platform supporting tens of thousands of luxury brands worldwide, including Louis Vuitton, Hermes, Valentino, Fendi, Prada, Burberry, Cartier, and many, many more. GlobalBlue operates a two-sided payment network with over 15 million consumers utilizing GlobalBlue's quick and seamless mobile app when purchasing luxury goods at over $400,000. retail stores around the world. When shopping abroad, consumers purchasing these luxury items are eligible for a VAT tax refund, which is facilitated by GlobalBlue. GlobalBlue also facilitates the option to convert purchases into the cardholder's home currency, which is something known as dynamic currency conversion. The GlobalBlue business is an exceptional standalone business. The luxury VAT tax refund industry has proven to be highly resilient, as affluent consumers wield substantial economic spending power, account for half of all consumer spending, and hold an estimated $1.3 trillion in excess savings. We have high confidence in unlocking $80 million of revenue synergies from this transaction by the end of 2027, primarily through bundling our embedded payment solution with Global Blue's VAT tax refund and dynamic currency conversion capabilities. We estimate the embedded payment cross-sell opportunity alone to be over $500 billion in volume. In addition, we continue to expect two of the world's largest FinTech companies, Ant Financial and Tencent, to remain shareholders in the combined business, and both of these wallets providers have committed to collaborate with us on e-commerce opportunities around the world. We are on track for an early Q3 close, subject to regulatory approvals. As I mentioned in my shareholder letter, we have a track record of growing volumes during the most challenging of economic times. Since the company was founded, We have successfully grown our payment volumes every year, including during COVID and the great financial crisis of 2008 and 2009. We have experienced five recessions in the past 26 years, and we have grown our payment volumes in every single one of them. I hope that by understanding our strategies that I just highlighted, it becomes obvious to you all that in many ways we welcome uncertainty. We thrive in times of uncertainty. And because it's our operating model, product lines, unit economics, and enormous cross-sell funnel all become more valuable when the future is uncertain. That's not to say we operate with rose-colored glasses. And in fact, it's exactly the opposite. We operate out of an abundance of caution and a mindset of paranoia. We are never complacent and constantly finding ways to evolve. With that, I'll turn the call over to Nancy, who will outline our 2025 financial guidance and key other stats for the quarter. Nancy?