Shift4 Payments (FOUR) 4 May 232023 Q1 Earnings call transcript

Thank you for standing by. My name is Briana, and I will be your conference operator today. At this time I would like to welcome everyone to Shift4's First Quarter 2023 Earnings Conference Call. [Operator Instructions]

I will now turn the call over to Tom McCrohan, you may begin your conference.

good earnings and conference and first to operator XXXX quarter call. you, morning, welcome everyone ShiftX's Thank With me Chief on ShiftX's Nancy Chief the our call today Officer, Disman, Lauber, are Taylor President Financial and Chief Strategy and Executive Officer; Officer. Jared Isaacman

being is Investor the which on our Relations at be found webcast investors.shiftX.com. of website, call This section can

quarterly letter, quarterly to related results quarterly our been shareholder financial posted materials Our have IR our website. to results and all other

statements materials differ Our and guarantees include result today are call These our could not factors. future statements. results of earnings materially, and performance and many important uncertainties of forward-looking the certain actual risks, as

the factors XX-K the Investor SEC's Additional those is information corporate Forms in Relations section reports and of our concerning you most our which on on website recent XX-Q, website. and available find can

non-GAAP GAAP related quarterly For call, discussed in measures letter. and information any this today's are available shareholder on the financial reconciliations

Jared? let call the me call turn With that – to over Jared.

morning, Tom. Thanks, Good everyone.

to and pleased meet or strong we guidance us less end-to-end to pace are volume, quarterly records start on quarterly believe our flow. fees will gross we previously that set including year, report network ranges. exceed provided results So free for the cash put to reasonably We revenue a

within was driven our from performance and converting high-growth verticals ongoing new Our success by our momentum service. contribution core, to gateway end-to-end volume

pullback likely spending. assumed consumer plan in XXXX a Our

January week by some with the Patrick's the see part, including softness around others. does quarter. most February seem did provided end was quarter. in consistent Day, there in of the was we typical strong For and the This trends fact spending St. any March did weekends of observe March. Early towards but in spending the exhibited last not commentary but moderate record spending we patterns concerning

data, would April test see May June, in and expect on will optimistic typically strength. where real but we the be cautiously to are We seasonal

XX% and account quarter, today for have emphasize in are It is important volume of data. total revised to volume we around new our taking compared watching due merchants end-to-end we positively represent closely restaurant to guidance our early while and back that approximately the rapid this hotels, So mix. to in larger volumes percentage shift in despite our XX% enterprise of XXXX. growing and growth is verticals our to occurred our restaurants This

On that note, volumes roughly annualized merchants platform $XXX on and gateway-only of XX we an addressable our end-to-end currently that XX more processing have additional in million the population. are than

to winning trend guidance large us raise either new net expect merchant This of only the environment. us accelerate diversification still a as expand we uncertain a an adding merchants is enterprise continue through or customer the face to converting of economic what what We confidence and simply this gateway in gives is even internationally.

and our So performance now on to results. quarterly

payment XX% generated XX% in gross in we quarter, network year-over-year in records. our first revenue quarterly the end-to-end year-over-year growth revenues growth gross For volume, fees, our growth were year-over-year all which and less XX%

travel with newer as continue and and core entertainment, leisure the to driver from an growth high-growth Tech derived gaming. increasing of such our Our Sexy verticals, primary sports and contribution be

We legacy direct a overhead; of unnecessary less Gateway are we which from consolidating monetizing parts POS our and brands SkyTab our predominantly sales and growth present of deleting are value initiative D, card factors: our which in overall gateway POS where and program. momentum require of in support model the which services; not hardware; continued profitability, less derived four properly accounts, high-growth sunset very a, our the enterprise require serving is new proud verticals, following

prior of years overall and All requirements unit of eliminated these CapEx initiatives model the economic have either growth or services. to our reduced enhance relative

initiatives. focus our core; our high-growth the areas; new global of verticals; three and on will rest expansion I comments my

does the core with business at starting -- And our includes high-growth the primary of to as entirety continue a ShiftX core our core our of with the reminder, So high-growth be high engine and volume growth. growth at of over for core XXX billion offering our over of March. $XXX of and library integrations the as time available integrated IPO is conversion payments built gateway software a mission-critical on of

many With our executing strategy, conversion still we further success of and sunset years early clearly the innings on in are strategy. of this gateway monetization

along and rates new win take merchants and net rates all associated Our between stable. conversions gateway with consistent remained their

last XXX% added of our -- also on of POS includes new our thousands named systems our quarter, component SkyTab. rates. growth our core and annualized QX growing have at high-growth restaurant Like over A system new with we volume

are ability stadiums including our hotels. across multiple to positioned verticals We offer in theme parks and serve POS SkyTab uniquely our we

with for example, also agreements two So which their major promoting restaurant SkyTab throughout quarter expanded their includes and successfully hotel franchise. clients, we them locations renewed this in past

our hotels, Considering serve believe pipeline that strong and close with our we promising. in for very new presence relationship companies software SkyTab is hotels this business

and evolving and entered into OpenTable providers software quickly are partnership the leading agreements with SkyTab and two online RestaurantXXX, reservation the of capabilities recently industry. Additionally, restaurant we accounting POS for

restaurant launch sales economic of cloud-based our insourcing direct SkyTab POS products offering. POS cash distribution time more our year pivoting to This important of substantially improved offering the by model reminder, margin was flow purposes; a late and coincide served it to new of our last a first, initiative As model. the unit two with the

this commission eliminated partners hired new best in-sourcing only of essentially component not of initiative. XXX we from the recurring all expense from existing accounts, but forward a as going our a So since initiative accounts also

acquired we SkyTab are believe for going basically we a demand of on far. so have expense variable So of lot results very which well markets that very, out we we're the and took working in to costly a additional know overhead

sunset of gradually allowed it legacy POS Second, us several also brands. to software our

basically, efforts engineering, reminder single a manager service our unify POSitouch and as So strategy, And SkyTab POS, a and that is includes energize POS. restaurant development, which and sales to Harbortouch. product Future

eventually rapidly play us out many, over without also freed and to years of their And ShiftX. migrate the another believe acquiring a to modern resources and to up software having count. payments textbook enable capacity we add our company, head grow This will So customers' continue customers this significant that POS very represents to run software solution. and efficiency cross-sell playbook is many gain to legacy SkyTab their

again. completed back we that interested than an at acquisition So us We it years. has are for more five

payment XX,XXX this software acquired on which called over company So we a that not quarter to supports a representing POS are $XX opportunity Focus ShiftX. up POS, restaurants billion

acquiring software a have major us payment which an to in a not other POS, plan talent added together to we've a is capability processing and ShiftX allows relies to instead playbook with that on And By form payments payment does we we very very, POS Mike over to very, the Hamm. including plus bundle processing and use POS ShiftX, we Focus software work integration are vendors, and SkyTab. capabilities Focus several executing of time direct know which XX,XXX the eventually merchants owning on migrate of the existing Focus quickly. installed convert of by well base very

will about moving we we we've revenue an past, organic And payment believe sales them we and shown business comparable a model the restaurant and software from done that away POS XXXX consistent and believe strategy acquire pivot acquisition deals a very historic minute, with existing the revenue towards will license high-quality as in payments their past. the the volume be model instead and will in Taylor to Like and we customers. ultimately down low-cost wind talk in established hardware contributor this as of represents way SaaS so Focus we've integrated to prove a the approach in

volume XXXX contribution guidance a slightly So our in raise picture. entirely and short, outperformance to in the of revenue QX more view XXXX minimal be macro we attributed can optimistic expect and and

signed Arizona's including to the We hotels. during new numerous moving is brand resorts resort resort. quarter, which property on largest now named signature So XX-acre VAI, the

Vegas Las entertainment Additionally and we especially being an new center. signed notable properties one two large

also software retreat between represent power unique West XXX-plus a These leveraging balance Woodloch located We in of wins, the new and Manhattan. our simply signature Side of ,The nice conversions Hotel gateway Pennsylvania integrations. wins Lucerne Upper the signed in net SPA

moving on verticals. new to So

Our IPO, as and volume well end-to-end define markets of end reaching into steady and verticals sports which still entered new We incremental expansion long all new runway a which verticals benefit payment contributions merchants have nonprofits as within crypto contributions -- our new the our consisting entertainment, from methods volumes state is post including levels. from from APMs, alternative before from continue as sexy we gaming, international to tech, verticals, within and overall travel, our donations.

is reiterating that when for and partner settling impact be the to and you of the APMs essentially take worth those attention revenue as not will an revenue that future like may modeling can It's to in our expand gross gross PayPal, gateways becoming with funds APM The directly which be into we volumes revenue and gross international that and our internationally of bringing less transactions. we payment fees international of your network mix. portion consideration increasing same, so this context continue

of uptick entertainment gaming witnessed stadium strategic this last and into ticketing our relationships. from year volumes in late and enterprise ramp overall a new with travel, continued verticals course in The quarter incremental nice volumes, vertical, our including

the Our recently to announced also partnership quarter. PayPal ramp throughout with began

all just Sox of In of process Chicago the and where volume concessions as FedEx we White commanders all food for entertainment, as their parking sports guarantee will well in field, too. and Washington at Field will not but process beverage the retail we

ticketing all the with of we for water locations college and Park operations Lincoln along US and Denver and signed Arkansas Oregon signed sports, State Six we all an of beverage agreement also Chicago's beverage processing University. the process with food the beverage park in Flag and for University the In and in agreement Waterworld called sports, and their to with payment food Zoo. processing food popular Outside

and Alicia sales Philadelphia. non-sport the the including are in ticketing, tour. Center summer processing we including performances, all we Paciolan advanced Keys Wells recently announced ticketing live In with Fargo are for for

ticket begin is well, ticketing season that now pursuing which Paciolan as Now we college includes advanced will for live, sales. athletics

XX states with went go-live, also as their a in are OCT operating is added offering, live last anticipated gaming is this our the seven In to quarter. and OCT in jurisdictions. throughout which operators which market. highly in adding gaming, ShiftX week Two BetMGM we product integration currently are desired currently partnership additional online later in online

in company cross-platform verticals. games Light the & ShiftX signed digital agreement an leading the casino Wonder, brick-and-mortar and global with

will Adam ShiftX for a Adam a we via in Canada. table. enables provide access the solution support are cashless for transaction to card US, Specifically funds table the is debit players will but gaming product, be & adding leaving Light which also processing without Wonder's Initial games.

roster clients nonprofit of despite in marketplace an the processed Block nonprofits year, entered consider card has on platform of the our otherwise number annual nonprofits The donation of when We following nonprofits. over challenging added over Giving to general. Moving remarkable to X,XXX for over to joining X,XXX. grown our growth more in currently year this on really last to volume. our considerably XXX crypto platform space We a XXXX pipeline year connected to you bringing cross-sell $XXX donation current than million of processing nonprofits, especially

As giving over The $XX billion for $XX Block opportunity when a initially the our result, just pursuing customers, associated volume initial Giving opportunity is represents nonprofit over cross-sell a is total year of we billion. the existing charitable cross-sell. you billion sized well billion-plus announced $XX ago the the we're donation with we $XXX now

We ACH and to important smart billing recurring including are capabilities in software. donor donation third-party investing integrations forms, management still

fundraising such products the will and is our first card Giving Block we to in as right stock the The enhancements pursued key donor place. to traditional peer-to-peer win accounts our which donations, believe why all which cross-sell added we increase recently of We've

Block's on givingblock.com annual I'd highly you out giving The key at found the the which industry. on charitable more can Giving recommend stats XXXX report be to check for

X.X Moving times on mentioned XX over as global last we're on Payments expansion, journey. months, I've to the many a

new in product, We organically strategic U.S. a made all world those the inorganically are and us over then and merchant bringing markets. into expanding the all relationship successful and signature services following the that integrations

initiatives. M&A one pipeline both expansion To our organic end, terms investment priority remains our and allocation in number that capital of

We from regarding get in of acquisition our Finaro Europe still awaiting remains regulators are final obstacle deal which regulatory this closed. the bank to approval

as have banking Unfortunately, well matters their some close We believe that recently attention Europe deal the or regulators have last high-priority approximately regulators XX-days few will met the with less. and in as Finaro team high-profile had the European in and captured in months. the

of this use closing. We have and great made signing though, between time

So technical and we've over between ShiftX integrations the completed last Finaro the year platform.

card-not-present We card-present begun and transactions. have live processing transactions now

consolidated marketing We on operating plan. have and international organization and go-to-market opportunities, the strategy expansion collaborated commercial priorities, and

ground the after hit closing. running We ready are to

In fact, support we feel our able attention opportunities been in X.X Payments shift to of to amount that we've so priority. prepared other fair a of

include from our update accordingly Finaro, does a which deal any closing. not guidance XXXX following will reminder, As we contribution the

PSP online card-acceptance enterprise are international customers. quarter their benefiting processing connection last volume strike in focused is We from which also developers and and offering, we like currently tools with the for our on acquired

We in capabilities currently countries. now offer these XX over online

track is And are Our number opportunities organic expansion Caribbean year. we the and and to M&A LatAm, into on this completed exploring reach into our Africa Eastern expand Canada, of will that Europe be a APAC.

to allocation the on over thinking our priorities and how our provide success. currently call attitude handing about comments want some we Before additional Taylor, capital to I towards general XXXX, are

March early our about XXXX. and forthcoming We environment, have been as concerns as highlighting operating the expressing including concerns our of consistently

budgeting view informed process current spend. market been and will test willingness As has that of to entire a consumers' conditions our the our result, by guidance sustainability

Our a the consumer spending remains with low-end recession. stable mild assumes guidance reasonably upwardly revised assuming

climate uncertain continue and remain year. headcount on for this as possible laser-focused controlling plan been Given for the to as to we've expenses flat our

the companies believe that layoffs preference the navigate including to at several the responsible where Our ahead. I recent take to upgrade we is advantage talent way is appropriate. admire of tech to year

prior top quarters, is Global allocation Expansion with X.X requirements. on delivering capital our Consistent priority Payments our

a of smaller completely have from to We tactically beneficial strong opportunities ranging strategically transformational and significant pipeline transactions.

to position, of some a small time generating of locations. at closing ending have Considering elected with in quarter an cash same cash, stronger lot net times. are adjusted number operating leverage while and facility make we investments upgrades, ratio of our We a consolidating the X.X the our

sales $XXX workforce. buybacks. EBITDA million our buyback strong to we believe and prior CRM sheet below levels, improve We has in Valuation new authorized also EV system Board our force began internal in our making Considering to of a share investments will to which efficiency and replacements the include our present balance being productivity up

While we value. shareholder opportunistic create other about authorization, are this with prepared excited avenues admittedly are to to of we a variety be available

talk though. as experience As patting challenging do constantly ShiftX successes. pretty and we celebrating a only position are on isn't management the internal don't much want typical real to know team, attitude public I company the spend it's calls pretty I the can this you, earnings a back always processes things improving no end, ourselves to well all. we to are do the win, our products at customer operating we a about to we To how environment. and that ensure matter in assure

powerful and and the We can way. even following a executing that over way, there This get embracing staying effect believe small procedurally ShiftX urgency. flat, about improvements driven out is the parts, ownership, all time radical we'll have taking all which incremental is by compounding with the being

over Taylor? to With Chief the call that, Taylor I'll our Lauber. turn Officer, and President Strategy

allocation around Finaro our Jared's for year. capital priorities Thanks, of Jared, update and then provide like and the operating environment good on some morning, context remainder to the remarks and everyone. I'd regarding the

growth are who of gateway $XXX payment to verticals using in presence of integrated to we unique an thousands of are software and volume, internationally. little tens others multiple billion but a for customers very several franchise processing, ShiftX. technically reminder, emerging As avenues for that new have us,

volume And unlike customer companies, of new XX% proportions, XX% other to from grow we pursuit being gateway to equal additions growth. comes our with as coming customers. tend and growth all of In virtually in of opposed net all from industry these, conversions roughly payments

for growing nice e-commerce payments tailwind and be our Although, international us. should in presence a

need were $XXX a and to our another just of This our roughly exceed remaining would way convert volume adding to to if thinking opportunity, gateway. conversions, embedded nearly this from we of To come have customer. the about give only gateway medium-term that still the a-third is year guidance new single of incremental you growth on half billion without

in A For Starlink, the better notable you internal now. the discussing March. with despite our quarter, our we've contributor in from Jared first in came softening than which late in our mentioned several for was quarters transactions been volumes quarter all modest expectations the

timing cadence from enterprise including ramp takes such the volumes an are verticals, still things fully sales platform. getting or total the merchant volume new our season their as time ticket after integrating to the with familiar We our for to

several have know the enterprise-level now we their still merchants volume of ramp that full we potential. in Fortunately, are stage

Our as ramp. our Payments are we will from should But blended spreads spread activate you this growing a alternative moderation of International strategy. contribution X.X accounts. reflection enterprise expansion and a balance large and new methods merchants verticals and expect help lumpiness as pursue payment

basis anticipate full to several impact XX volume business within it have out the spreads during we the a large Based incremental may is an for quarter-to-quarter. influence around note but blended would our on evolving seasonality, little in exceeds important or and spread from example guidance, our factors To year. is all our merchants, points quarter that guidance one pointed quarter. another. one blended a updated average spreads APMs, It bit to spread lower be international may extent on the likely that I our

our remained January various we of Spreads witnessed holiday break across had an within through comp light high-growth benefits very terms from the easier and spring expected in core, year of cohorts stable. this from the our increased the a and ago. trends impact Omicron's quarter In in travel core high-growth Easter

plans about via this are or clock release triggers complete to upon status. To-date, to to XX-day application The for notify European that In bank regards a hearing step closing. our our notified yet final Finaro, the in notify have is X-K is step for is us fresh is our meeting which with be final trip our to regulators to final and press XX regulators. This closing team either approval. investors we application a and off complete, that the in is our

Our advisers are end delays. the we June unanticipated to despite of by track close still believe some Finaro on

at impressed are an contribution like calendar to expected excited financial the on Once the year I'd and accordingly. we with team very update been and for to mention that Finaro deal Finaro have guidance we the also close. closes, updating acquisition from providing anticipate have this XXXX our

million capital XX,XXX and April, $X.X software are provider in $XX In ShiftX. to we acquired company an of million. is POS allocation. in EBITDA base with a not using XXXX. profitable, Focus over Turning The generating roughly that restaurant This $X.X early revenue restaurants for installed in million is point-of-sale

associated running costs. focus base believe However, at roughly is this reasonable the acquisition represent a highly attractive card we this completed We pass installed of this restaurants for volume billion. with anticipate payment -- acquisition $XX valuations customer stand-alone but business, actually was

as because this convert the we We which bolster what existing weighting talent revenue profitability. and place pivoting revenue the our due do population will mean SkyTab believe model Over plan our will We the to the earlier. will protection also any payments our to opportunity to upgrade is distribution mentioned tech customers. towards economics downside not have existing capabilities it existing further the and well provide time, and guidance, Jared in as

attracts at for talented existing an rarefied and win the few candidates generation growth believe quarters flow balance puts and cash despite As an strong us who strategy, the accelerated we we've opportunity air, a pace. sheet and now, customers' been both join convert see mentioning ShiftX between climate. disciplined to our put to acquisition targets, uncertain in This We continue opportunity ourselves competition. and massive to distance

resources significant ripe we've decade. and a Focus both in M&A amount tuck-ins as the as result. environment last The investing towards seen deals a POS is of as are We transformational like for

CFO, like I'd that, to to the over call our With turn Nancy.

morning network impressive and the good delivered volume records we gross less quarterly In quarter, results, and including fees. revenue Taylor Thanks, everyone. first for

with the flow, year-over-year our delivered in several free over quarters. cash improvement also meaningful adjusted We past trends witnessed consistent

million, the gross For $XXX year over total grew $XX.X $XXX last revenue XX% were same less fees last year. of gross last year. up volume the the of to from billion and QX quarter, an million, increase XX% network same QX period revenues XX% quarter compared were

the adjusted quarter EBITDA $XX.X adjusted the margins for for were quarter and XX%. EBITDA was Our million our

launch our Our our quarterly verticals of improved new by the unit large were earned and to customers in a resulting momentum in-source of in high-growth driven higher decision our core, continued our connection and results from go-to-market from of SkyTab. our with distribution the portion gateway economics strength economics,

As to software and a to brands, consolidate major SkyTab decision, markets. sales establish a sunset reminder, POS team a POS in strategic this gradually was direct promote and many legacy

blended we basis expected, ramp XX.X to basis points for As is spreads. continue lower last ago very was a XX.X quarter points basis large merchants, spread enterprise XX year blended which quarter. versus the points first and add and resulting The in

enterprise decline in strategic and lower take quarter spreads by our last driven hospitality major operator The for in take signed rate against quarter stronger what from the QX rate QX sequential mix our is agreement new verticals, restaurant to with a seasonally slowest was merchants new higher customers. the a towards

Again, shift mix quarter-to-quarter. accounts enterprise blended our a XX ongoing enterprise new our year, spreads the towards volume to the expect Spreads full from as high-growth vary to Taylor larger entirely stable. growth the spread function points verticals. of We rapid compression average remained anticipate would And for core we basis our and mentioned, in can spreads. average strategic is accounts down though around

pleased with margin We expansion. to our continue be

represented product quarter vertical EBITDA XXXX launch XX expansion across nearly points first We despite the adjusted of this to nearly X,XXX the XX% compared growth-related delivered and including margins, SkyTab at expansion, of investments, -- levels. organization. quarter, upgrades ongoing margin roughly expansion, expansion, our ongoing For basis talent new the first international

million the to the margins on $XX Additional which including about spend year. further processing we ability improve for in-source opportunities to per horizon, are still

was conversion plus. adjusted XX% full Our well $XX.X cash of flow the year free our was cash guidance free adjusted in our XX%, above and million flow quarter

advantage our consolidate with to Jared mentioned applications. legacy replace systems internal upgrade our cash facilities and and We as free to are some modern force-based of taking our outperformance, more expand of sales flow

growth. cost support approach investments committed management to to balance million initiatives. quarter remain the for disciplined highly We to while our $X.X to Capital a included these expenditures continuing towards

AMC was quarter XX.X diluted Net was Class for basic the respectively. Net basis income diluted share shares was for million share a basis outstanding. per $X.XX per $X.XX per share million million first fully income AMC the $XX.X on and and a $XX.X average $X.XX on quarter diluted net on or income Adjusted

We of debt $XXX $X.X undrawn cash are facility. exiting of million billion quarter and the our million with over on $XXX just credit

Our EBITDA. net based X.X for end X.X leverage four at the quarter was approximately adjusted adjusted contribution the all when initiatives times, quarters times, of recent of on and trailing

strong sheet pursue profile Our invest will in opportunistically flow and business cash balance Jared free earlier. repurchase continue shares to allow as the priorities mentioned us and strategic to our

the Turning guidance, reflects the volumes guidance increasing for to the as economic full in the first regarding end free and scenarios flow. the high When introduced proves and KPIs range low for business February, year are our for XXXX variety and which events outperformance and given range the increase operating quarter. a well is adjusted of we our of appropriate we The current cautious our quarter tempered end cash accounted ranges of guidance optimism in by of hindsight we environment. first late the indicated EBITDA in our the

best-in-class recent climate to contemplate implies guidance become we modest our of profitability confident trends. growth continuation uncertain peer remain to in high our Regardless and we guidance of of environment guide Since end the our among low only operating of introducing and consumer the the believe macroeconomic deliver a spending. The end the headwinds set. our more ability in continues has

when closing adjusting and guidance not date the mentioned, certain. Taylor included will is be our Finaro becomes As

year-over-year $X.X representing includes year-over-year of year-over-year billion growth. $XXX representing total adjusted Our end-to-end $XXX XX% fees XX% guidance less volumes Gross updated million XX% revenues of revenue Gross growth, to XX% growth. and $XXX XXXX XX% $XXX to billion, representing XX% million, to billion $XXX network of EBITDA of $X.XX million, growth. to million representing XX% to $XXX for billion to XX% to year-over-year to

adjusted cash approximately We assumption from basis points points to previously. XXX free $XXX anticipate least guidance ranges our $XXX prior adjusted basis of flow approximately of expand to XXX and be our EBITDA million at midpoint the versus margins million up at

Finaro guidance this or contemplated a any As reminder, XXXX. include does in other M&A not

call let Jared. me back turn that, With to now the

And Nancy. ready Thank Operator? you, operator, questions. take we to are

Rayna question first comes Your Instructions] from [Operator with Kumar UBS.

Your is open. now line

processing Good are Congrats new that wins Jared of these entertainment while as just an others noticed ticketing existing some the well? sports sports this the I customers team. gain concessions, morning, of and food to currently you of that And and see for wins. and do processing some the include What you opportunity ticketing and of as include on some you beverage for? not enable your entertainment do ticketing. factors do

just yeah, Sure, to for timing think And comes have, question. with agreements. or I Rayna. the existing sports Thanks teams down this really leagues the existing of These providers.

all venues our as many So of entertainment previously it's to agreements, we actually the the the processing. and contemplated in get sports that of with announced well as ones forward going

parking we have picked retail mentioned I examples we where as sales. up mean, and we merchandise this So quarter,

prize. is Of the course, ticketing

Ticketmaster forward an pretty should So try lot to have integrations the be we their couple providers over but years, roll should it going much current our a now easier ticketing when well that existing last and switch agreements announced be idea flip. that their off with as we easy but as customers we'll which capture is previously upfront, everyone, as of the to

So other and probably their time, XX we I over I ticketing has mean, agreement one ShiftX. already can that that stadium major NFL since ago moving that of is to months think announced expired

So, forward. the that going really timing. It's contractual should pace just be

sunset time volume have think to on provide year the number the conversions. --on gateway the was line be million convert then, over in customers you ago? will $XXX on XX helpful. the Can it. Got do a you XX-plus And end-to-end that what you or remaining the Very business? gateway And what

I'll we endeavored Gateway we've year the a on is that although This that. did million. hit count last a that sunset specific don't say portion disclosed that a Sure. Sure, deliver We from have efforts Taylor. $XX year will I ago, Rayna. that significant of

So, we’ve been we enterprise with that publicly customers. a now success have for increased while saying

the over us it of -- remaining has seen. more saying don't remain around to comfortable last than since of that but I about year. be half but And too I'd obviously March XX, want joined will gives that be optimism be to last the point XX, some So, at specific and increased

I Yes, XX new of think excess process million $XXX right of have end-to-end like in It's the the is the interesting in point also volume. is that one Rayna just stat mark today like out on virtually net to that's we wins. customers half approximately

I of So our company about about close conversions consistent to month, public gateway. wins from since from this, a our our we've come XX% as new every production mean, net been comes from rather that it XX% time seems very and just

massive So population that a the gateway our quite while addressable production other there's month. on our market customers XX-plus represents still move every And XXX large. to over half million-plus of the is of still

Great. Thank you.

comes Your with next Suisse. Chiodo from question Credit Timothy

line open. Your is now

morning, Good you. Thank Great. everyone.

comment XX%. a mentioned at now mix roughly restaurant You on the end and

letter verticals? just verticals. You've some a you comments directional the of kind has hoping hotels other also bit and round just a around I follow-up vertical by in and graphic made to have shareholder past of it the could finer the on retail on the And and going in sense a point putting put point hotel a finer maybe on a guidance. new little a was get out us new can brief I that mix just of updated then, end-to-end

further. Taylor even a to data us. to and for our intention mean, then We full It wasn't can first I have in Tim, I crack weigh provide and invite subvertical don't Tom of core. at in take within high-growth or Yes. Nancy by front that breakout that

long know I ago is mean look, last, I think the year to I point on stakes $XXX how back calls was don't going going are saying, to March I XXXX, earnings the of a right? really

the was we on we've -- we take less reflecting expressing going highest for restaurant has cautious because are that concern exuberance about been lot. mean year a a mean vertical with our the on especially restaurants specifically guidance, in raised the network over the fees, ahead now. to something I more been rate revenue I gross the business. volume into year We're contributor

is the for very, at lot. IPO in we shifted certainly being we the share So are We're almost our restaurants significant, of ahead. the investors pandemic, the very all a we mix wanted year that But closely. beginning were that inside the business that the of to point like optimistic time with rather is has that a when our cautiously watching

of that we the the a taking shift part in hotels. on lot was started story of Now first

ow the answer hotels. is we have a lot of

lot We have a of retail. specialty

strategic We and have of safety stadiums have lot a accounts lot a accounts. we tech of

to weather So starts the now that restaurant we at the IPO. far, reason the business diversified have whatever were than the more weather a is far -- industry time of if ShiftX that point pullback, better far is prepared to for being

I in to can for just it And layer a of bit rank kind you, Tim. little stack

was lodging and new about. and a been opportunity by largest contributor. in the The has followed other Retail the second very stable verticals quarter vertical talked we expansion

the last have So we've growing been got some modestly a enterprise pretty grow it's the handful years. stable vis-à-vis of other occasion, customers. large on a We over few them. that win contributor components all with but We

guide to the board. this Thank revenue SaaS follow-up received want Great. year a we the That's across kind that from currently Taylor. earlier just and right. sure would acquisition, there I got rev brief context and be XXXX rev The small but in including to you make Jared then of you mentioned it partners really token you're is, The both share assuming of I including focus know you are SaaS helpful their streams the or associated other acquisition? they current a plus contribution share, nothing with some I'm fiscal

but nothing, let why. as me to specific including we're So be

Our contribution and that we the this for profitability year acquired revenue that diminished internal diminished actually it has the in plan as well. is is the acquisition

out should business plan, will to go for the paid a right? So plan on we as not well of what basis it a the want that point remainder that's year, contribute not but our the we through of

the guidance emphasize than what for the they that Our that plan base the less works much deliver we exceed contributions business To more XXXX. cohesive us plan we'd sort customer bundled expect we short-term will outlined that extent year, were payment the a well target be them our and goals the plus we but is in we'd that like of financial that in solution. software the to of helps

Yes.

first shares and the that's that whatever closing our reinforce $XX Tim, revenue thing or rev had this here, competitors million $X.X Let is happen so the that the pause at on times $X into we've from playbook run are there's went because going me off. points of of million competitors focus those XXXX. some time EBITDA, in to before going just Like in processing billion three approximately accounts to XX,XXX cut

a to from software, them step to as revenue and current also the contributes mentioned, we're some and pivot like hardware sort take And over business going will moved backwards. selling currently time which So the payments. of Taylor model then away to instantly SaaS and

in So to well running we talking XXX% because out, their much time mean, as I three path like you we're like in niolate know you're that about net a current Taylor put works than organic I this previously. this, model pretty better like successful growth really to revenue from them point

play $XX accounts if So, billion of bit forward. little we're successful years to it into that guide, we're business factored the go yes, a going not our in backwards next our because will is results, converting take over the sure XX,XXX for out actually payment XXXX but to in handful volume

Perfect. Thank questions. both of those for you

Will Goldman from Nance Your question next is Sachs. with

open. Your line is

that how at a think to Do the What platforms sequencing to and of then end I Hey, longer-term, when this guys. wanted that taking really that last Thanks roll of this the benefits Good And do over benefits have? of question. with same future-proofing the you acquisition. mean, the the piggyback talk I SkyTab of financial aggressively that strategic versus like? the executing ISV And how morning. you that into could think question. about maybe sequencing do platform. time? on does as volume converting focus one SkyTab of two-step platform kind to legacy just you Is for about of out kind look it on the you process? all you about business longer-term the to

the the point because is negotiations. I'll he of something Will, like done first half So sequencing through hit playbook, time and is this as then mentioned of the we've part we're Jared a can this in transaction walk

to point years in many working on as out, want with is is, Jared discussion this been for mentioned I them. one we've So

exciting, So it the we plan an in get able master while in is just fact that It's really really a but were asset liked. that not that regard. for to we strategic necessarily we've done a April been after

Yes.

in XXXX a several acquired and legacy four one-time from hardware span of payments towards over POS the So incredibly providers of in pivoted we years jumping playbook, one-time SaaS away model I mean, their sales months span of in a successful. three terms on in software, and

the support drawback what's different lots software Now teams. there well of your supporting is to that you're

now So of over on a was different merchant-facing of lots you're your lots think I occasionally years. mean, of I have criticism couple software. teams last developing support different support the this Bears that software had to

ago. Now what did and we three which a offering, do basically really sunseted around all unified everyone quarters those SkyTab. We product single brands is

it teams, so our what our mean, that engineering I So teams, service teams, training get developers, our our marketing -- that many freed you our efficiencies. did is up support,

POS. would SkyTab say are forward is in So like of towards now efforts like I our XX-some-odd a percent single marching direction what

some lots we and legacy some have still it that's of and portion them have of the those of brands, because supporting lots team on are customers growing. You

So important. that's

done is to we've on been free POS. to able some up resources, what take Focus And

who for even the team. going are the run XXXX team a this this What leadership like executive total perfectly can't the be one. senior the like is So well, know range, on a of are know how here is, the a in in on ball management it playbook, it and lot people deal with to $XX-some-odd our Focus team run million that to or that's middle

plays in merchants XX,XXX and business years, year expected, business new couple first it over. that over lots volume have failure And already as next the customers billion converting gone $XX the of of past is of out it's period, which their you have great, volume because usually lots again in and

this you like the So, fall of from of to time part wins, plan. into that camp broader as pick our can up strategic time would tactical nice

Jared. last color, point. that maybe follow-up, appreciate And just I that it. a Got on

You kind allocation. management of mentioned priorities around, and team capital

initiatives distributors international, and inorganic capacity stand-in of going lot here, from buyback, near-term on, Finaro. on? we of a team this got Focus you've some digest sort additional going Do SkyTab, or as like POS, a a about initiatives you we got should have as the acquisitions have for of think guys you You feel management of

question. Yes. It's really a great

philosophies right the organization started incredible two way, a I bring really So, - like first from to of and I the mean largely all, if that you recall the ShiftX ago years ShiftX. Rob, about

parts is been fail. literally right reduce the for the principles of and are years. because there parts complexity, two parts that One out take We've the to costly doing

we various to mean initiative Sunset to and we Gateway maintain have in XX The I one at probably our different had that all point, invest competitors. connections of

that We we and service mentioned have as to. point-of-sale multiple different legacy on and develop support I brands, had to provide

adding we headcount have that years continuing the costly than without to and which more ago. efficiency, did of business, two necessarily add lot far out that a last we the say capacity taking complexity the spending seen are is, today What years, brings of parts I'd We've organization.

the Finaro, so work much our mean to this extent us to and prepared on allowed his I closing permissible opportunities. Also, to prolonged Taylor signing turn length, attention mentioned advisers the integration from transformational bigger at that that we has -- plan. our as period largely show arm's remarks, more in can by

capital So lot communicated, capacity. is Free to point up. way flow we a to initially we close cash is, quarter Finaro is two And look I ago. than with a have think what deal of respect or a year allocation, the going later

other rather we'd have deploy capital we think into. that priorities, I

inside buying of valuation on an mentioned But remarks, as EBITDA we're basis, back where I were in previously. we my

plenty organic So and have and a bit, more a cash little we'd year ago investments. for a we of can than still with probably opportunistic be inorganic we little other have had thought capacity

fine. that's think I

it, taking makes the Appreciate Got sense. question.

Your Peller Research. Wolfe with next is from question Darrin

open. is line Your

to go wanted Thanks. later, I get Hi, a closes lot you been move I on than the that do to little I -- able to know international pretty for buildout. -- deal guys. a quarter. just of up to guys more quickly. the Finaro work sooner when fortunately, to hopefully, ready Nice have follow

But, done And position maybe means be you're far, when help us relationships customer have of of of talked a understand to kind plans so going the large the only so more expansion you terms in Thanks. about. what of, leveraging hope you've not in we've just US some internationally and closes generally, from just the others. one with little that the what and deal what you to see

business process should that a as aspects meaning routed of Yes, technical we're stands I'll transaction sure. and to Finaro the customer been right? and want customer settle integrated begins US, each entity. volume payment are ShiftX work the customer development hit partners, completed let to a ShiftX the I'll and talk Finaro So internationally. that other ShiftX a the a versa to at platform vice ShiftX cohesive US this, all systems, on in for that's for partners Jared, it about but The settle technically as and in and to it's Finaro Finaro, to today

kind big our the past So, lot of products the of strategic development the in pieces that successful think do development US Europe, of in the executing think throughout kind world, over have place. international a we few now the Europe, cetera. the against front, complete. the all ambitions largely then so we've made the mentioned. et kind and there's, months, all project right? And that against There's on So, business to exciting a priorities. set the technical successfully distributing the there's Jared e-commerce, most of And technical restaurants are that been have of card-present of throughout executing transactions, two us pronged over There's hotels, customers I is

a a that development of effectively all we of business is of drive complete. the technical underpinnings the are question how now new what it's largely priorities region. kind work And in So,

time just so much Yes. I to much work. there's I mean Darrin, so there's this, on mean had right? to to we've talk

months we three since like so had or we've it. think announced I

of strategic So, platforms. one both that's more I have just mean first way all than between customer cross-border we processing

integrations amount make So, somewhere been transactions not an Europe. range existing XXX dozen like that card-present We've and leveraging doing of we US, the volume. the Europe. been a in like insignificant have our in in in several We've now special

operator times people mean think referenced example in I very restaurant has in group operator, the I UK. we've many for well-known -- US locations the opening hospitality one like

there success now be we turn awesome story. so We have can That's people testing going an to live. them

on Europe international think going cloud-based to organic into POS to a leverage expansion product restaurant Finaro strategy how got integrations working to in I Europe that very different in we're different language I So, support to best how with and you've to big fiscal team How offering. requirements? support customer team you is solve are with Eastern going it collaborating and distribution? a want mean locations Europe distribute it and work

doing So, prolonged we're because it's of close into initiatives to that like organic of process. on an ahead the all the phase into in energy able America signing M&A get such to North the mention not like is Caribbean. moving -- to and going Canada much just we're post so marriage deal a we're lucky

we're on be I as that this our point focused the performed part has timeframe out whole of business but didn't is right? Darrin if a businesses core own well to these its a are we our strategy stand-alone throughout pretty vision obviously that profitable the because we right wrong. I'd against Finaro So, the before growing nicely M&A it well grand business really risk we my want that on ambitions. at averse that's it done get business We execute remiss

e-commerce. And I year that cross-border year that. a well. nicely given point XXXX tough business have largely they a over be given, for So, helps performed is do which shouldn't us are that the the that out to fact

really just follow-up Thanks. around free Right. would cash. Nancy guys. I be and can margins helpful my That's

obviously the You seems like to the tens regard of the -- would now. had in we've run you in now are what with improvement kind initiatives showing it you some said of right that they're

leverage it there or the maybe yields? Are a levers story larger now great. Is just I'm albeit be Just we able that should little more an that see should next be year how mean would operating just curious think forward? over to X? enterprise about I offsetting we going more color on

all think those it's I Yes, of things.

which one our bring obviously, around The us, to processing, think is that map there That's biggest the road one. called the ahead right? still the script certainly in I of opportunity I is in-house on out largest opportunity the still.

that out a a I the more in we and still the larger I we to leverage we're mix. as efficient That model about this but know generally and model servicing service talked is quarter But last customers. think operating upmarket lot just go continue much right playing as

think room. So, I still there's

for are making in-house. some needed We investments as

I called still nonrecurring room. ongoing opportunity as that versus rate there look run some of stuff think of the kind CapEx that out see kind of we we little bit we more is one-time. But spread at a kind of think as So you'll

do So, in improvement. that you the guide

to close and And think just to continuing comes leverage to the like I the vest a model improve we always defending little that and the operating keep from bit spend. internal

Jared quite kind improve we're I that to pushing think a there keeps flat. little still room probably bit of of but a joke where for we're right keeping there's everything at. not And

guys. Okay. Thanks

Thank you.

Ashwin comes Citi. question next Shirvaikar with from Your

Your open. line is

of talent resorts had between larger the and morning things I sort speak restaurants is can QSRs you to like A Good good Thank mom-and-pop maybe diner folks. places that? here. you places appropriate? results the Whatever breakout say Congratulations. type so was question within

total rather end part It's the to -- of downturn it's across is to the portfolio. market. a of smaller still a of trying guess your to impact get I -- what but still large a I'm sort your dissect becoming largest

that service we're in Yeah, largely start sure. table restaurants. say I'll and

can multinationals. large they a diner location the all up owner example from to So you a operated way vary single have

-- more pretty we've winning been So diversification there's broad around the years in space. upmarket recent of We've more that. and

kind mentioned You of hospitality.

our that market handful into large restaurant to wins hospitality their year over think locations. worth of noting SkyTab it's last I the opportunity involved the a

I service in that food start brands and across operated number pockets we've win hospitality in expect think the want But you of to table that we've space. with and to service it's for then So given table diversified the specifically got unique vertical. beverage that the pretty historically

winding the to the sort would understand that perspective kind benefits of of could to if multiyear you benefit. increase say the -- of various Understood. But speaking, Understood. continues the a what relative effort of numbers? from know your expect relative pieces? help you get and the you brands a sales from that versus out SkyTab, maybe continue pieces it's roughly cadence And to the concentration of break do as to hit down penetration how other the benefits various cadence I it

Yeah. approximation. just I throw I'm mean like general going a to

retrain supports to Taylor a Tom, had correct most XX% your nearly Nancy a But to new labor-intense you counties, commissions It's customer would I've the distribution. the to or managers. to times hardware. items, small third-party that. just for jump restaurant. in In Lots restaurants. menu mean customer So of month, all calls largely me. get acquire. sorts our of us were educated also new the if But is codes of quit, past, every We've before I I got phone price most workforce there like in-sourced said changing relatively like of managers many you various tax guess, it costly think give I

labor very intense. So

imagine Now legacy different five that four across or brands. POS

or So different have now really know to five well. four software you solutions

standards ordering, at it's on like new them make develop support have You devices, to super online handheld them not encryption all. efficient

talent pounding because the and of legacy-based those a which business been this like of we're of staying the I've do go able the can more lot year out when like headcount that So table we all couple still take parts the for of quarters upgrading flat on to are into systems. last

should not so you're the to customers to software applications new leverage the able we is already and anymore. to able add idea organization in support be lots be the So capacity and going you're having lots many of because different to

one. like that's So

is go are product, someone just SkyTab looking sexier need to Two it's see We Not hybrid it's cost going Windows-based the and of to cost updates. us less into our like third-party tools deploy. in better access on. like of bloated to remote to it's to the actual Android-based. kind on hardware tools less. less. systems log and own POS It considerably solution mention the very support also of make The cloud use We what's don't fails can SkyTab hardware expensive. cloud-based. very and cloud-based the since supportability is

forward. quarter everything a to like that these migrate cloud-based going solution. amazing you to carry is benefits And are are going us single So as just every

lots yet more the the addressable a to There it's to just more use we are right feature customers all now have market, with that use because even going of both are it's addition lot solution. In success two again market a Toast cloud-based distribution have market set cloud-based solutions us of fact in intense solution. want to -- the labor It's and is Windows-based intense and and good to and don't the a more the addressable maintenance monster.

Thanks.

Operator, one we take question. more will

In Andrew the interest from Jeffrey of time final with question Securities. Truist our comes

Your line open. is now

Andrew. Hey,

SkyTab. the that about you point-of-sale love I'm path of how you vertically installed potentially are a I further with means for SkyTab being about you see SkyTab solutions your advantages enterprise legacy Can these description little POS of the integrating some thinking the Jared, bit and against able discussed. evolution customers to systems? bigger what And talk just of mostly a go as after

about there. to Yes. There's talk much so

costing hotel to both just two the two differentiate this more access stadiums. with little – a just what So in game let's fine. and winning are there's new customers the is providers huge, teaming our with pretty addressable just are of market hotel we net knowing – market, that that's right? to management middle property like our and there's And certainly going like do is in start where think really And hunt that bit let's little there, to bit overlap just and is system only only So we're a really players us. the just I – out operators plan for going

like announced those merchandising, their SkyTab stadiums a mobile ordering, restaurants doing previously have the past. we're our the And So the them. the in lot ticketing, that we've in of all

natural other cross-sell us. like a that's But So the hotels. for also bundle is

management system product using using properties. hotel integrations we property older have like here advantage have, hotel they're could they're That's Business remarks, my we Two multiyear have costly our I the So to renewed that wish already expanded Windows-based promote really relationships cost disclosed those have using It's SkyTab in them are. mentioned and operators like we tokens probably then prepared strong we I their and system. scope a into we of they because already. huge agreements and with all the agreements Intelligence hotel and assuredly major with an POS an older

us. advantage big for a that's So

have other on. to simply The in a know markets. we're with country is coverage, be the lot are of We partners successful going years we we've on lots just distribution best had in-sourced that based the of our all data for SkyTab we over

of So kind we're out going US. the in that's how and go to conquer

are the globally. take of opportunity to advantage going Toast exists Both certainly and that us

We be distributing will Europe SkyTab year. definitely POS in this

it in doing be to right? deleting those question, previous lots like well. mentioned to as with can so I then going already installed journey, they're all And by that's parts the base, think I efficiencies the respect existing unlock a of we and lots operational

of very SkyTab mindful we a deploying existing start your flow, you to customers. I are of being mean systems free cash POS lot

we get from some might a revenue you're hardware. revenue, but SaaS lift little capture You previously didn't a deploying bit of

to be by when just going not cash you're about we So trying free their customers is know solution flow of of like legacy is well at thousands way SkyTab SkyTab, because the from that that's it's upgrade if we're the every we're to upgrading existing going how costly. talk to with you results that we're having quarter and customers tens where

ignore. It's also something you can't

within everybody responsible operational a product, organization. a over of two, unlock to the about be it efficiencies years, You're to on just three two, get going the single next ton want

day. your to the back get all I’ll Thanks, helpful. super That’s inputs. Appreciate

Thank everyone today and talk call Thanks. us to And we'll soon. you on I appreciate the you. joining

conference call. today's concludes This

now may disconnect. You