Good afternoon. Thank you for joining us today for our earnings call to discuss the second quarter 2026 results.

With me today are Ron Clarke, our Chairman and CEO, and Peter Walker, our CFO. Our earnings release and supplemental materials for the quarter are available on the Investor Relations section of corpay.com.

Please refer to these materials for an explanation of the non-GAAP financial measures discussed on this call, along with the reconciliation of those measures to the most applicable GAAP measures. Our remarks today will include forward-looking statements about expected operating and financial results, strategic initiatives, acquisitions, and divestitures, among other matters.

Forward-looking statements may differ materially from actual results and are subject to a number of risks and uncertainties. Some of those risks are mentioned in today's press release and on Form 8-K, and can also be found in our annual report on Form 10-K.

These documents are all available on our website and at sec.gov. Now I'll turn the call over to Ron Clarke, our Chairman and CEO.

Ron?

Jim, thanks. Hello everyone, and thanks for joining today's call.

Up front here, I plan to cover three subjects: first, provide my take on Q2 results; second, share our updated guidance for 2026; and then lastly, I'll speak to our future and where we're headed. Let me begin with our Q2 results, which were very, very good.

We reported revenue of $1.34 billion, that's up 21%, coming in $45 million above our expectations. Q2 macro, super favorable to us.

It contributed about $30 million more than our expectations, meaning about $15 million of the beat was just underlying performance. We reported cash EPS of $7 on the button, that's up 36%, setting an all-time company earnings record.

Feels good. Our two biggest corporate payments deals, the Alpha acquisition and the Avid investment, contributed 39 cents of cash EPS accretion in the quarter, spot on our target.

Q2 fundamentals, very solid. Overall organic revenue growth, 10%.

That was led by our corporate payments segment at 16% and our vehicle payments segment at 8%. Taken together, our two biggest segments delivered 12% organic growth.

Operating trends also very good in the quarter, retention remaining steady at 93%, year-over-year sales, or new bookings, terrific, growing 30%, and same-store sales in the plus column, plus 1%. Look, these trends are super helpful and bode well for continued performance here in the second half.

All in all, really an outstanding quarter, an outstanding first half, really against both our expectations and maybe more importantly against the prior year. All right, let me make the turn to our 2026 outlook, where we're raising full-year revenue guidance to $5 billion 310 at the midpoint.

The bridge as follows: first, we'll flow through our Q2 $45 million revenue beat; second, we'll increase full-year revenue guidance another $15 million based on expected better macro and business fundamentals; we'll net out $40 million related to our expected Epyx divestiture, and there we're assuming a September 1 close. We will continue to outlook 10% organic revenue growth in the second half, with our corporate payments segment expected to maintain a mid-teens plus organic growth, and our lodging segment set to accelerate to mid-single digits.

On the earnings side, we're raising full-year 2026 cash EPS to $27.35 at the midpoint, that's up a ways from our $26 initial guide at the start of the year. The rest-of-year EPS bridge goes like this: we'll flow through our Q2 cash EPS beat of 45 cents; we'll raise the rest-of-year cash EPS another 20 cents; and we'll hold the Epyx divestiture EPS impact neutral as we plan to use the deal proceeds to repurchase CPAY shares.

Look, this higher full-year 2026 guidance implies good things: 17% full-year revenue growth, 28% full-year cash EPS growth, cash EPS for '26 up about $6 from 2025, cash EPS exit rate in Q4 exiting over $29, full-year cash EBITDA approximately $3 billion, and $1.8 billion of full-year free cash flow, which is approximately a 7% yield. The drivers really of this '26 performance are a combo of a few things: obviously, a very favorable macro environment for us, particularly the first half; the two big accretive corporate payments deals; and mostly just strong underlying fundamental operating performance.

Look, taken together, we've got a lot of confidence in the outlook. Last up today, I do want to share our thoughts on the future, the road ahead for the company.

We did post an updated investor presentation today to our website. It lays out our direction along with our growth algorithm.

I do want to say, we've really never felt clearer about the way forward, or even more excited about the prospects for the company. We're really in a great spot.

Let's start with the portfolio. We have said repeatedly that our plan is to create a simpler company with fewer bigger businesses.

You should expect to see us divest more subscale businesses like today's Epyx announcements, and really double down in three primary areas. First, spend management, which is our card and AP businesses.

We'll do more there, we'll head towards the procurement space more, we'll expand wider geographically. We will make that a bigger business.

In vehicle, we'll stay invested in our largest and most advantaged fleet businesses, and we'll also embed fleet into our spend management platform so that our spend management platform can serve the unique needs of fleet-intensive companies and their drivers. There's actually a slide, I think it's the last slide in our supplement, that lays out our progress there, where we're selling our spend platform to both fleet-intensive businesses and traditional businesses.

Take a look. Last area to double down will be cross-border.

Obviously, plan to do more there. We're in the process of adding new real-time private blockchain rails, also investing to build out our global banking and deposit offering.

Both of these things we think game changers for middle-market companies. The portfolio repositioning gives us a $600 billion revenue TAM for a $5 billion company today.

Look, it certainly gives us the potential to at least 10 times this company, to say $50 $50 billion over time. The second direction for us is to go left, which means we plan to help our clients with their indirect expense decision-making before they approve payments.

We'll help support decisions like the selection of vendors, the pricing of vendors, the terms of vendors, the renewal decisions they need to make with vendors, and we'll deliver a set of things to be helpful there. We'll provide some benchmarking data, we'll provide spend insights, we'll even guide clients on how to negotiate renewals to a better outcome.

Look, we really do aspire to bring more value and go left, better helping our clients with the expense management assignment. Finally, let me turn to our mid-term growth algorithm.

It remains unchanged. As a reminder, we target 10% plus organic revenue growth, low teens PBT growth, and over 20% cash EPS growth.

The model works, first again because there's a large opportunity for us to sell into, we do have proven retention and sales capabilities, and we generate a material amount of free cash flow yield. We do expect to have approximately $15 billion of available capital over the forecast period.

That's via a combo of our annual free cash flow plus higher debt capacity as our earnings grow. This capital is what creates EPS acceleration as we'll either buy back half of CPAY, or alternatively, we'll buy the earnings of other corporate payment companies based on the relative returns there.

Look, in conclusion today, we are obviously delighted with the Q2 performance, we're confident in our raised second half guide, again expecting mid-20s year-over-year cash EPS growth, and we're really excited about the future, the road ahead, and what Corpay can become. With that, let me turn the call back over to Peter to provide some additional details on the quarter.

Peter?

Thanks, Ron, and good afternoon, everyone. We delivered another outstanding quarter, with 21% revenue growth and 36% adjusted EPS growth year-over-year, marking our fourth consecutive quarter of outperforming expectations.

Our first-half performance was exceptional, and we're proud of what the team accomplished. While we've certainly benefited from favorable macro conditions, the foundation of our performance continues to be consistent, double-digit organic growth.

That consistency is the engine behind our compounding model, and we've now delivered double-digit organic revenue growth for five consecutive quarters, and 10% organic growth in five of the last six years. Having been in the CFO seat for just over a year, I can tell you these outcomes don't simply happen.

They are the result of constant focus, active management, and thousands of decisions made across the organization every day to drive returns. I wouldn't underestimate just how important our operating discipline is to our long-term performance.

Now let's turn to segment performance and the underlying drivers of our organic revenue growth in the quarter. Corporate Payments delivered 16% organic growth for the quarter, including a 180 basis point drag from float revenue compression driven by lower interest rates year-over-year.

The organic revenue growth was in line with our expectations, with strong performance in both Cross-Border and Payables. Overall, Corporate Payments continued to be driven by strong underlying customer activity, with organic spend increasing 43% to $95 billion.

Cross-Border continued to deliver strong sales and revenue performance in Q2. Alpha's integration continues to progress exceptionally well, with over 80% of Alpha's corporate volume now migrated to our global tech platform.

The Payables business continued to perform well, driven by sales and volume growth in Q2. We're also pleased with the strong performance of Avid, our minority investment, which is reflected as an equity investment in our financials.

Avid continues to execute well under new ownership, with sales growing more than 30%, continued strength in volume and revenue, and EBITDA more than doubling year-over-year to a record level. Vehicle Payments organic growth was 8%, right in line with our high single-digit expectations.

Brazil and Europe remain quite strong. In the US, growth remains consistent with our strategy of reallocating sales investment toward the higher-return opportunities within Corporate Payments.

Lodging was in line with our expectations, delivering sequential organic revenue growth improvement of 2% versus Q1 2026. We've now lapped the more episodic events last year that created tough comps, and we continue to expect organic growth to perform in the second half of the year.

In summary, we delivered 10% organic growth in Q2, driven by sales growth of 30% and retention rates of 93%, all quite robust. Our Corporate Payments and Vehicle Payments segment totaled 84% of our Q2 revenue and delivered a combined organic growth rate of 12%, consistent with Q1.

Taken together, these results reinforce our confidence in the durability of our growth model and support our decision to increase full-year guidance. Now looking further down the income statement, operating costs increased 9%, excluding the impact of FX, M&A, stock compensation, amortization, and a settlement charge.

The settlement charge of $100 million relates to the FTC matter and is subject to final Commission approval. The 9% increase was primarily due to sales investments and modestly higher credit losses.

Adjusted EBITDA margin of 57.3% was up approximately 100 basis points over the prior year, primarily due to operating leverage and flow-through of macro benefit. Our adjusted effective tax rate for the quarter was 25.3%.

The year-over-year decrease in the tax rate was driven by our improved mix of earnings. Turning to the balance sheet, we ended the quarter in a very strong financial position.

Our leverage ratio finished at 2.55 times, and we had approximately $1.6 billion of available capacity under our revolving credit facility. During the quarter, we repurchased $321 million worth of stock, retiring approximately 1 million shares.

As of quarter end, we still had roughly $1.4 billion remaining under our current share repurchase authorization. We also completed the refinancing of our revolving credit facility and term loan A, increasing the size of our revolver by approximately a billion dollars to $3.7 billion, while paying down our term loan B by a billion dollars.

Over the past nine months, we've successfully refinanced our entire debt stack, extending maturities, lowering borrowing costs, and further strengthening our balance sheet. More importantly, from a capital allocation perspective, we've increased our financial flexibility and are well positioned to continue executing our balanced strategy of both meaningful share repurchases and disciplined, accretive M&A.

Finally, I'd like to touch on our interest rate profile. Following the Alpha acquisition, our restricted cash balance increased significantly, primarily reflecting the growth of the global bank account business.

Our cash now creates a meaningful natural hedge against our floating rate debt, with approximately 85% of our exposure naturally offset during the second quarter. Including our interest rate swaps, we were effectively more than 120% hedged.

Given the strength of that natural hedge, we don't expect to enter into additional interest rate swaps going forward. Now let me share some additional information on our updated 2026 full-year and Q3 outlook.

As Ron mentioned, we signed a definitive agreement to sell Epyx, a non-core vehicle payments asset. We expect the transaction to close this fall, likely between September and October.

For planning purposes, we've assumed a September 1st closing. The transaction is expected to reduce 2026 revenue by approximately $40 million, or roughly $10 million per month, but is not expected to have an impact on adjusted EPS because we intend to redeploy the proceeds into share repurchases.

We're raising our 2026 revenue guidance to $5.31 billion at the midpoint, growing 17% year-over-year. Importantly, this guidance continues to assume approximately 10% organic revenue growth for the year.

Our updated revenue outlook flows through our Q2 beat of $45 million, raises the rest of the year by $15 million driven by a combination of macro favorability and business momentum, partially offset by $40 million from the sale of Epyx. We're raising our full-year guidance for adjusted EPS to $27.35 per share at the midpoint, growing 28% year-over-year.

This captures the 45-cent beat in Q2 and raises guidance by 20 cents from higher revenue and productivity improvements over the rest of the year. Our Q3 revenue guide is $1.355 billion at the midpoint, growing 16% year-over-year.

We expect Q3 organic revenue growth in the range of 9% to 11%. We expect adjusted EPS of $7.15 at the midpoint, growing 26% year-over-year.

Stepping back, our model is built to compound over time. We remain focused on consistently delivering double-digit organic growth, maintaining strong margins, and deploying capital where we believe it generates the highest long-term returns for shareholders.

Additional details regarding our full-year guidance raise and Q3 outlook can be found in our earnings release and earnings supplement. Operator, please open the line for questions.

Hi, thank you so much for taking my question, and another great quarter. As freight prices remain healthy and fleet operators seem to be in a much better place than they were God knows post-COVID, do you see an opportunity to open up the credit box a little bit more, maybe lean in harder to some slightly higher risk parts of the market to drive on the vehicle side of the business, obviously, to drive incremental growth?

Hey Ramsey, thanks for the question. We do experience with fuel prices going up and the demand that there's naturally a higher risk to credit losses.

We've taken a provision for that within the quarter, a slight provision for it, but what I would say is we're not going to weaken our underwriting standards to gain business here.

Fair enough. Then on a follow-up for me, you announced the Epyx divestiture and you also talked about the intention to create a simpler company.

Should we think about that as more trimming more of these very small kind of embedded business lines, or is there an appetite or demand out there for a larger simplification of something like a lodging segment or larger chunks of the business?

Hey Ramsey, it's Ron. It might be both.

I'd say we're on the track for the first thing you said. We've ID'd another two, three, four businesses that are kind of subscale or not as related like the Epyx thing.

As I said, on other things, we want better performance first, right? I want to have improved performance, because then it gives us options.

I'd say you should look for more of the Epyx-like things over the next six to 12 months, and if performance improves, maybe something additional.

Got it. Thank you.

You bet.

Even we can't hear you, Tien-Tsin.

Oh, is this better?

There you go.

Sorry to waste your time. As always, nice to talk to you guys.

Just thinking maybe for you, Ron, just has the bar changed at all for M&A and buybacks given pipeline, valuation? I know you're focused on these divestitures you've announced, one that you just said.

Has the bar changed?

I don't think so, Tien-Tsin. Like I said last time, if anything, we've seen some of the transactions, some of the deals on the acquisition side get back into a realistic range.

I think we're actually in a pretty good spot.

No, glad to hear it. Then just on the bookings front, that was really strong.

Maybe just double-clicking on that, how broad-based was it? Where are you outperforming?

Can you replenish the pipeline as we go into the second half?

It was pretty good. I'd say I'm looking at that report.

It was pretty broad-based. We did kind of high teens year-over-year in the vehicle and crazy, something close to 40% sales growth in the corporate payment segment, we're obviously selling a lot of that.

Now again, we poured incremental investment into it, there's more spend behind that reflecting the increase. No, it's good.

We target, I think, sales to grow 20% to kind of hit our growth algorithm, this is a bit better than that. I'd say our rest of year is probably targeting about that 20% again.

All right, great. Done.

Thank you.

Good to talk to you, Tien-Tsin.

Thank you. Ron, the Corporate Payments division obviously did really well with the organic revenue growth up 16%.

As we look ahead, it seems like the comparisons get easier. Can this growth rate sort of sustain itself if not accelerate from here?

I think it's a good question, Sanjay. I think it's a function again of investment.

We're guiding basically to 16 plus here in the second half, which is obviously attractive. We've got super line of sight in that business on both the retention and base.

I'm staring at it, it's better than our line average, right? Our line average is 93.

That business is closer to 96% or 97% retention, and the base is positive, it's in the plus column. Whenever you have that set up, it's not complicated for math people that the whole growth rate is sales, right?

It's just really the sales. As I said to Tien-Tsin's question, we sold 40% more in the quarter.

That's the toggle. Again, unlike the startups, we always are trying to balance making a buck with growing, and so that's the balancing act.

We put incremental money into it, we've taken a bit of money out of the vehicle thing, and so I'd say that's our plan for now. We're continuing to build spend on that, and we'll update if we decide to invest more as we look into next year.

We're obviously pleased with this growth rate.

Okay. The second question is just on the divestitures.

As we think about the divestitures you will make or that you've identified, do those accelerate the revenue growth rate, or are they just sort of too small to have an impact? Then maybe you could also just comment on what you're seeing in the M&A market in terms of acquiring stuff.

Thanks.

I'd say the answer to the first part is it depends. We have businesses, I guess we've announced to you guys two divestitures this year, and the answer is those would actually be slightly growth dilutive to us.

The parking business was a high flier, right, grew I have in front of me, 20 or 20, 25%, and this Epyx thing was a kind of a perennial 10, 11% grower. Some of the other things we're looking at, Sanjay, might be lower growth, if I said, hey, we have three or three or four things in the block, my comment would be it'd be a mix.

Some of the stuff might be a little bit slower growing. It's really what you said, we're just trying to clean house with kind of smaller things.

We need to add billions of revenue to the company, and so growing a $100 million business to $110 is not getting us there. That's the emphasis.

I'd say the same thing on the acquisition side. Obviously, we did a couple of pretty large transactions last year.

We've got our gun sights on some other pretty significant things, and so as I said to Tien-Tsin, we're super clear on what we want to acquire, what would be helpful. We target or are in discussions obviously with those companies, and some of those transactions are meaningful, and because of the way we can run the things, they're actionable.

We can actually do them. I'd say, like always, stay tuned on the acquisitions front.

Thank you.

You bet.

Good afternoon. Thank you for taking my question.

Ron, I was wondering if you could give us an update on the Mastercard, the FI channel. I think previously you've called out three wins.

Where does the pipeline stand, and are you still expecting a couple of points of cross-border acceleration from that? I just trying to get an update on that Mastercard partnership and where things stand with the pipeline.

Thank you. Yes,

it's another good question. I think we said it last time, if I had Mark, the guy that runs it, or the Mastercard folks, at the high level better than expected again.

I think the thesis that we had that Mastercard knows bank folks and we know cross-border and that's a good combo, that's proving to be true. The numbers are good.

We're now at 10 FIs that have been closed. On the last report I saw, we've got 100 active additional FIs in the pipeline.

I would say it's positive. The offer is resonating.

Mastercard is being super helpful in introductions. With FIs, the selling cycle is definitely longer, Mihir, than it is with corporates.

I would say we're still bullish on it, and I said to the Mastercard people when we did the deal, please don't make this a press release. I got to applaud their effort and the energy so far.

I'd say so far, good.

Great. Then if I could ask about just the global banking, I think, Ron, you described it in your prepared remarks as a game changer.

Just trying to think about the monetization timeline there. I think Peter called out some of the benefits of the hedging, but just from a revenue standpoint for CPAY, what's the monetization timeframe, and what kind of expectations should we have over the next year or two?

I think we should see a big step up next year. We still, frankly, are building the product.

Let me give the baby 101 here. What we do is we open local foreign bank accounts.

If there's a company in Atlanta, they're trying to do business in Europe, boom, in less than a week or a few days, we can open a foreign bank account for them, which would take months, years potentially through a correspondent. The work that we're doing, Mihir, in the thing is effectively linking multiple local accounts.

Let's say the client in Atlanta wants to open something in the UK, on the continent, and Australia, and we go open three local foreign accounts in those jurisdictions so that they can ride on the pipes there. What we're finishing up is tying those together and then balancing them back to that account's primary bank account, let's say back here in Atlanta.

That kind of second part, I'm going to call that the enhanced, the better product than just the one-off sell the local account, which is where Alpha kind of focus. That is due to be out of the kitchen in Q4.

Two things: one is I think we'll sell a lot more of it because it's way more attractive, right, to go to an account and tell them, I can add these in different places, but then tie them all together for you. Then second, we're going to sell the you know what out of it back to the client base.

Think of how many middle-market clients we have in cross-border, in payables, even in fleet here and internationally. That's the second part of the idea, is to tell all the existing clients we have, whether they're in cross-border or not, hey, we can be way helpful in this way.

I'd say it's going good, Alpha's selling a lot of the kind of the single local thing, but the hopes are that this kind of premium offer will be a big deal next year.

Got it. Thank you.

Yep.

Hey guys, thanks. Ron, you talked about the opportunity to cross-sell your fleet card, your fleet management products into the spend management customer base.

Maybe just talk us through how you're thinking about that cross-sell opportunity now, and where it stands, where could it go more broadly across other products in AP and bill pay also and cross-border? Where are the opportunities to further expand with your existing base that you have now?

It's a good question, Darrin. It has been a long articulation of that.

We did stick in, you probably haven't seen it yet, but if you guys on the call would open at some point the what do we call it, Jim, the earnings supplement, the last page in there, Darrin, is an internal slide where we actually show what you're asking, which is, we call it internally a spend management platform, call it cards plus software. Basically, on that same platform, a client can buy different things.

Drivers could buy fleet stuff, travelers could buy T&E stuff, procurement or purchasing people could buy purchasing stuff. If you look at the thing which is interesting is, we take that same platform and we sell it to fleet-intensive businesses, and if you see that slide, not shockingly, they buy a lot of fleet, a lot of fuel.

They do buy some other stuff, like at the mid-size ones, almost half their spend is non-fuel. Then we sell the same exact thing to kind of traditional companies, maybe the white collar that don't have the same kind of drivers, and they buy a little bit of fuel, but all the other spend categories.

The message to everybody is we're just embedding it. In other words, we're taking the fleet networks that we built and the point-of-sale data capture and the mobile apps for people, and we're just sticking it in the same platform so that when our guys go to companies, they can actually ask them, hey, do you have a lot of drivers and fuel, or don't you?

To your point, it's not a dumb idea now to go back to all the big-size fleet guys and say, hey, how about buying some other stuff on the same thing? Going to the regular guys and asking, hey, did we miss the fact that you actually have some drivers?

I think it's going to be simpler, hopefully, for people outside. It's not just a bunch of kludgy proprietary fleet things.

It's literally now core to this spend offering that we're going to take out in the market. I think advantaged, Darrin, because other guys that make business cards or corporate cards don't have 20-year-old networks for fleet purchasing or even the virtual card network that we've built.

They have just vanilla Mastercard or Visa networks. I think us attaching those networks to kind of our card program is going to be a pretty big advantage.

We collect more data than they do, we have better economics at those merchants than they do. If you take a peek at that thing, hopefully the slide in there will be explanatory.

All right, that's really helpful. Thanks, Ron.

Just maybe a quick follow-up if you can on margins. We continue to see them ticking up sequentially.

Should we expect for when we're thinking about further expansion from here, just how much more investment do you think is needed to sustain this type of 10% plus organic profile? Clearly it's not small.

You're not on a low margin base for now, and so I'm curious what your thoughts are on that. Thanks.

Hey Darrin, it's Peter. Thanks for the question.

What I would say is for the quarter, we obviously achieved a really strong 57% EBITDA margin. A lot of that was helped by flow-through of favorable macro, right?

For the back half, we kind of expect to be slightly below where we are last year, and we feel like we're really invested at the right level to deliver on the organic growth targets. We already achieve really strong margins.

The thought is that we won't look to accrete those significantly.

Okay. More of an investment story, that makes sense.

Guys, thanks.

Thanks, Darrin.

Hey guys. Great job.

One thing I was just wondering about, it looked like Brazil remains a little slower than normal, and you still had a great quarter. I guess I'm wondering how much better maybe it would have even been if Brazil was running normal, and maybe am I right about that?

How's the Google partnership or ad search stuff going? Maybe just reflect on all of that.

Dave, hey, it's Ron. I'd say, to your point, splitting hairs, it was a smidge slower.

Yes, we're still sitting in the same spot with the Google search. We have a couple of, like always, new ideas.

You'll see that thing kind of in our rest of year, we have that thing ticking back up again a point or two in Q3 and Q4. We haven't basically planned in that forecast for that Google issue to resolve, but we have some other kind of tricks up our sleeve there to keep that thing chugging.

The free-flow thing is actually helping us. I don't know if people on the call know what that is, but still a third to 40% of all the toll transactions in Brazil are not electronic.

I think like 7% of the market is now moved to free-flow, which means there's no other way to pay. You have to pay electronically, you can't pay with cash or a credit card.

It's bringing incremental travelers into the mix. Things like that, along with some of the sales things we're doing, so that thing will be again high teens performance here in the second half.

Great. Thank you.

Just one follow-up. The other revenue stream was up a lot sequentially in Q3, it was up about $20 million sequentially last year in Q3.

Does that create a tough comp at all, or is that kind of normal seasonality going forward?

Appreciate the question. As our gift business is in there in the other, that's really the largest component, and there's quite a bit of volatility between the quarters in the gift business.

Last year, they also had the changeover in terms of the new cards, which really drove that up. I'd say it does create a tougher comp in other in the back half of the year.

Gotcha. Thanks, guys.

Great job.

Thanks, Dave. Thank you.

Hey guys, nice results, and thanks for the question. Ron, I thought your commentary on go left was pretty interesting, was maybe hoping for a little more color on what your optionality there looks like in practice.

I guess what products and solutions you plan to bring to market to help clients with vendor selection, pricing, etc. Is this going to require a certain level of investment, either organic or inorganic, or is it simply more kind of reorganizing your existing resources into something that will help clients?

Then maybe lastly, how big do you think that opportunity could be and what could it add to growth in the coming years?

Super good question. Big, Nate, would be my comment.

At the high level, it's the AI models, right? Those things are changing the game in lots of places, and not shockingly, they're changing the game in and around corporate procurement and contract management and price comparisons and all that kind of stuff.

This idea from talking to our clients and having tons of clients and stuff is, hey, I've got, in our case, $800 million of indirect expense, and you guys are super helpful at helping us manage and control and pay all that. Should I have it?

Should I have $750 million in expense, and should I have these people I have? This idea is super adjacent, Nate, to what we do.

It's left, it's earlier, it's before you approve the payment, you decide whether you should have the expense and stuff. We're vetting a set of partners that have done some things here and looking at kind of integrating some of those capabilities.

What's interesting is we've got gazillions of clients already that they're telling us they approved the payment, we're making the payment with huge amounts of spend where we're not helping on the decision support very much, let alone telling new prospective clients, hey, we can be even more helpful to you. I think it's a big, big deal both in terms of revenue acceleration in that spend business and potentially sales, Nate, of getting people more interested, because bosses want to spend less indirect expense, AP managers want it to work well, the process to work better, right, and not have fraud, not to lose money and stuff.

We're really trying to appeal to that C-suite a bit more with these add-ons, if you will.

Interesting stuff. I guess just for a follow-up, sorry, just a little bit of feedback, I don't know if that was on my end.

Anyway, it was on the beat and raise. Obviously, some help from macro, but also you called out underlying momentum, I guess both in 2Q and for the rest of the year.

Was hoping you could maybe put a finer point on that underlying momentum. Is there one or two segments you would maybe call out as being better than expected in 2Q and then, I guess, for the rest of the year relative to your prior expectations?

I know high level, the relative growth rates sound like they're all in the same ballpark, I guess just on the margin, what came in better than expected and what do you expect to be better than expected for the rest of the year?

Hey Nate, appreciate the question. Maybe starting with the rest-of-year guide question that you put forward, our thought process here is it's a relatively immaterial raise at $15 million of revenue and 20 cents EPS.

Our message is our confidence in achieving our back half guidance, and just a reminder that we set a significant climb for ourself in the back half of the year. Absolute revenue is growing, call it $100 million Q1 to Q4, and absolute EPS is growing, call it over $1.50 from Q1 to Q4.

Quite impressive numbers by themselves in Q4. Again, just sharing with everybody our confidence in achieving those.

Hey Nate, it's Ron. What mostly I don't want you to miss, hey Ron, hey, how's your guide versus last time, and make sure your lens is on, it's 25% cash EPS growth in the second half over the prior year.

That's what we're focused on, is delivering an absolute growth rate and amount, exiting at 29 bucks or something. That's our main message, is don't miss that the numbers that we're sticking out there are significant as prior versus prior period.

Yep,

main message well received. Thanks, guys.

You bet.

Hey guys, good afternoon. Appreciate taking the questions.

You talked about some reallocation of investment from US vehicle to corporate payments. Obviously, the US business is much slower growth.

I guess maybe touch on your confidence level around sustaining high single-digit organic vehicle growth, especially as you reallocate some of those resources. It seems like it would be pretty high given your comments just now around high teens Brazil growth.

Would love to just hear your thoughts about the sustainability, especially in lieu of some of those reallocations of resources. Yes,

it's another good question. The first thing I'd say is they're good businesses, whether they're growing 8% or 10%.

They're durable as hell, they're hard to knock over, they're super profitable, they have advantaged stuff, networks, tech people, and stuff. The first headline to people is don't discount just the quality of the businesses.

The second point I'd make is the infamous pivot we made a couple of years ago, has landed us now at literally line average retention, particularly in the US and international markets. Historically, because they were smaller, the vehicle businesses had a worse loss rate, lower retention rate, and generally they had a worse same-store sales.

I'm happy to report today, problem solved. Because we've changed the mix of business, it was always larger internationally, but because we've moved the mix here in the US larger, we've now gotten to line average loss rates and same-store sales again around flat to the plus one.

It's really just a straight sales game, Madison, is my message. The growth rate now that we have stable base, which we didn't have, and way improved retention because of the business mix, now it's literally just selling.

It's just investment level and productivity. That's what we're still toggling with.

We've only have so much money, right, to try to make returns. We're trying to trade that off between the vehicle business and other people value our corporate payments business higher, I'd say we've leaned a little bit more that way.

I'd say it's high. If we keep spending money on sales and we keep making sales, I referenced high teens sales growth in Q2 over the prior year, we're still selling stuff.

I'd say that's the answer. It's stable, if we spend money and make sales, we can keep growing high single digits.

That's helpful. A follow-up on corporate payments here.

Obviously, you guys mentioned that you expect to maintain this mid-teens plus organic growth in the second half. You gave some color on retention versus new sales, but I was hoping you could maybe also double-click on just what you're seeing on the cross-border versus payables sides, and just any changes in expectation from the recent teach-in, or are things kind of tracking with what you laid out there?

Thanks.

Not much difference between those two kind of sub-lines. I'd say they're both, it's not like one is 10 and one is 23 or something, they're both kind of paired up in terms of the growth rate.

They're both selling a lot and stuff. As I said, I think the couple of exciting things there that could potentially make us do better is the bank thing that I mentioned earlier, if we deliver that version 2.0 and take it back to the base.

Then second, it's getting the payables and spend management product over the pond, which we've done, and grabbing that TAM, and we've got more sales and clients there. Those would be the two kind of upsides of kind of offering something or going somewhere that's not kind of in the current numbers.

Both of those things are in flight, if they take hold and do better, both of those things could be helpful to next year.

Hey guys. Thanks for taking my question.

You've previously spoken about the 40% of your flows within cross-border that are still on SWIFT. I think you previously had mentioned trying to take that volume mix down closer to the mid-teens level by leveraging some of the private blockchain rails like Kinexys.

Ron, you obviously highlighted that in your prepared remarks, too. I just wanted to ask on SWIFT directly just given their announcement about some more real-time capabilities as well.

How do you think about that volume mix shift and sort of the differentiation between that SWIFT real-time rail relative to something like a Kinexys in the decision tree there? Thanks, guys.

Michael, Ron, it's a good question. For us, because it's a rail, it's just speed and cost.

To your point, whether it's the JPM thing or Citi announced a similar thing. To me, having the banks kind of rally a consortium that wants to do this speedy blockchain thing, forget the stupid stablecoins, but just tokenized real money, we love that.

I think we said it before, I think 40,000 I think is the number, I think we've done 40,000 transactions already over the JPM private blockchain. It's not just on a paper, it's real, we're actually moving money.

The guy running the thing tells me, hey, I think we could get to half by the time we leave for Christmas. I think we could get literally half of our wires from SWIFT onto one of these things.

Look, if SWIFT somehow matched the speed and which they haven't today with their cost, between us, we're kind of indifferent in a way, right? As long as the thing goes there fast and it's low cost and super reliable and we can follow the breadcrumbs, we don't feel strongly.

The main message for me is, we like the idea of tokenized fiat currency. We love the idea of helping clients move money instantaneously to merchants 24/7.

If some of the banks, Michael, have said they literally credit it outside of banking hours. What do you need to get in and out of freaking stablecoins for if you can just tokenize a euro and send it to somebody instantaneously and it gets credited right away?

For us, I've said this repeatedly, the banks' announcements and moves, I think, way increase the chance of the outcome being what we've said, what we think is going to bounce here.

Makes a ton of sense. Then just a quick follow-up on Avid to the extent that you can share anything interesting in terms of underlying split there between software and payments revenue at this point, and sort of the willingness of suppliers to pay for that incremental software functionality over time with everything going on with AI?

Thanks, guys.

At the high level, Avid is doing super good. I think we said their earnings last quarter were up 50% over the prior year.

More importantly to me, I just had a review last week, their revenue growth is expected to tick up double digits as we get into the back half year. The revenue growth has been the key indicator for us, which they're bullish on.

The composition of that revenue to your point is been not much change. I'd say that the software revenue has been pretty stable, I think it's kind of low single digits growing, we've seen no attrition, no losses from clients in terms of paying the thing.

They're doing a very good job in getting wider monetization. They've gone beyond virtual cards, they've added debit now as another way electronically, they've got a lot more volume on paid ACH, if you will, that goes a lot faster.

I'd say generally the thing is going well, and we don't see a lot of risk on the software side. They're also way AI-ing their software, they're putting in a lot of cool things that they couldn't do before that clients like, I don't know if you like this, but called FetchMe, where, hey, normally I'm the little person that sends out 100 invoices, I don't see Ron Clarke's invoice, the thing goes and fetches it, brings it back.

I would say they're sexing up, they're making the software better for clients, which adds value, and so we're liking it. I'd say I'm more excited about that company.

We didn't say it, but the combo of Avid and Alpha is going to come in above I think I gave a dollar and I gave 39 cents, but that thing's going to be, pretty above the dollar, which is one of the reasons we're up above 35. Both of those big transactions, Michael, are performing for us.

That's great detail. Thanks, Ron.