Vasta Announces Second Quarter 2025 Results
HIGHLIGHTS
In the 2025 sales cycle to date (which commenced 4Q24 through 2Q25), net revenue increased 14% to R$1,488 million compared to the same period of the 2024 sales cycle, mostly due to the conversion of Annual Contract Value ('ACV') bookings into revenue in the period. In 2Q25, net revenue totaled R$359 million, a 22% increase compared to the same period of the previous year.
Vasta's accumulated subscription revenue in the 2025 sales cycle to date year totaled R$1,340 million, a 16% increase compared to the previous year's sales cycle. Complementary solutions net revenue in the 2025 sales cycle increased 24% compared to the 2024 sales cycle, to R$228 million.
In this quarter, the public school sector, or business-to-government ('B2G') segment, achieved R$9 million in revenue coming from several new customers, totaling R$50 million in the 2025 sales cycle to date, compared to R$69 million in the same period of the 2024 sales cycle, when the totality of revenues from our contract with the State of Pará (1 st and 2 nd semesters) was booked all at once. In the 2025 sales cycle to date, the 1 st semester under our contract with Pará contract was booked in 4Q2024, and the 2 nd semester is expected to be performed in the second half of 2025.
In the 2025 sales cycle to date, Adjusted EBITDA increased by 8% reaching R$462 million, compared to R$428 million in the same period of the 2024 sales cycle, and Adjusted EBITDA Margin decreased by 1.6 p.p., from 32.7% to 31.1%. In 2Q25, Adjusted EBITDA totaled R$42 million, up from R$26 million in 2Q24, and Adjusted EBITDA Margin increased 2.9 p.p. to 11.7%, compared to 2Q2024, driven by a 0.8p.p. increase in gross margin and 2.0 p.p. reduction in marketing expenses.
Vasta recorded an Adjusted Net Profit of R$111 million in the 2025 sales cycle to date, a 1% increase compared to R$110 million in the 2024 sales cycle. In 2Q25, Adjusted net loss totaled R$29 million, a 22% increase compared to adjusted net loss of R$37 million in 2Q24.
Free cash flow (FCF) totaled R$224 million in the 2025 sales cycle to date, a R$134 million increase from R$90 million in the 2024 sales cycle. In 2Q25 FCF totaled R$80 million, a 108% increase from R$38 million in 2Q24. The last twelve-months (LTM) FCF/Adjusted EBITDA conversion rate improved from 31.9% to 57.7%, as a result of Vasta's growth and implementation of sustained efficiency measures. Additionally, the first semester of 2025 benefited from early collections relative to the 2025 sales cycle, which are expected to normalize throughout the next quarters of the year.
MESSAGE FROM MANAGEMENT
As we conclude the third quarter of the current sales cycle, Vasta´s net revenue reached R$1,488 million, a 14% increase compared to the same period of the 2024 sales cycle, mostly due to the conversion of ACV bookings into revenue. Accumulated subscription revenue in the 2025 sales cycle to date totaled R$1,340 million, a 16% increase year-over-year, reflecting our ability to sustain revenue growth. Our complementary solutions also posted strong performance, growing 24% in the 2025 sales cycle compared to the same period of 2024, supported by accelerated expansion in both student base and market penetration. The number of partners-school using our complementary solutions increased to a total of 2,149 schools.
Start-Anglo bilingual school operations continue to gain momentum, having generated R$4 million in subscription revenue during the 2025 sales cycle to date. This performance reinforces Start-Anglo's strategic relevance and its potential to become a significant growth driver. In a short time, Start-Anglo has moved from concept to reality, with seven operating units in 2025. As of this date, Start-Anglo has secured more than 50 contracts, including two flagship schools, a notable increase from 30 contracts signed in the same period of the 2024 sales cycle. We are actively working to convert our robust pipeline — currently over 250 prospects — into new agreements for Start-Anglo.
In the B2G segment, we recorded R$9 million in net revenue this quarter coming from new municipality customers, for a total of R$50 million net revenue in the 2025 sales cycle to date. In the 2024 sales cycle, we had booked R$69 million in net revenue, as the totality of revenues from our contract with the State of Pará (1st and 2nd semesters) was recognized in 1Q24. In the 2025 sales cycle to date, the 1 st semester under our contract with Pará contract was booked in 4Q2024, and the 2 nd semester is expected to be performed in the second half of 2025. We remain confident in our strategy to positively impact public education by serving this segment and its students with our extensive portfolio of core content solutions, digital platforms, and additional offerings, including custom learning solutions developed over decades in the private sector.
The continued growth of the company's profitability was another highlight of the 2025 sales cycle to date as the Adjusted EBITDA grew by 8% to R$462 million compared to R$428 million in the previous year, and Adjusted EBITDA Margin decreased from 32.7% in the same period of the 2024 sales cycle to 31.1% in the 2025 sales cycle to date. In proportion to net revenue, gross margin decreased 2.4 p.p. in the sales cycle to date, mainly due to a different mix of products, lower B2G revenues and higher marketing expenses related to business expansion.
Cash flow generation continues to be a key strength and one of the main highlights of the 2025 sales cycle to date. Free cashflow (FCF) totaled R$224 million, a R$134 million increase from R$90 million in the same period of the 2024 sales cycle. The last twelve-month (LTM) FCF/Adjusted EBITDA conversion rate improved from 31.9% to 57.7% reflecting Vasta's growth and the implementation of sustained efficiency measures. Additionally, the first semester of 2025 benefited from early collections relative to the 2025 sales cycle, which are expected to normalize throughout the next quarters of the year.
It is worth saying that these measures include certain improvements in our collection processes, including automation, reminders and past-due notifications, customer segmentation, and faster renegotiation of overdue receivables. On the payments side, we implemented several initiatives to enhance discipline in payments, such as rigorous financial planning, centralized payments scheduling, and negotiating longer payment terms with suppliers.
Moreover, we continue to make progress in deleveraging the company. The net debt/LTM adjusted EBITDA as of the end of 2Q25 was 1.90x, down 0.38x from 2Q24 and 0.16x from 1Q25, reinforcing our commitment to long-term value creation to our stakeholders.
In the 2025 sales cycle, Vasta provides approximately 1.5 million students with core content solutions and more than 560,000 students with complementary solutions. This is aligned with the company's strategy to focus on improving its client base in 2025 through a better mix of schools and growth in premium education systems (Anglo, PH, Amplia and Fibonacci), brands with higher average ticket, lower defaults, greater adoption of complementary solutions and longer-term relationships.
FINANCIAL PERFORMANCE
Net revenue
In the 2025 sales cycle to date (4Q24 through 2Q25), Vasta's net revenue totaled R$1,488 million, representing a 13.6% increase compared to the same period of the 2024 sales cycle. Subscription revenue grew 16.3% mainly driven by the conversion of ACV bookings into revenue. Non-subscription revenue increased 10.9%, supported by higher enrollment in the Start-Anglo flagship schools and Anglo pre-university course.
In 2Q25, Vasta's net revenue totaled R$358 million, a 21.8% increase compared to 2Q24, mainly due to ACV bookings conversion into revenue, and the results obtained in B2G. Non-subscription revenue was positively impacted this quarter by a seasonal effect related to the delivery of student books, besides higher enrollment of students mentioned above.
EBITDA
In the 2025 sales cycle to date, Adjusted EBITDA reached R$462 million, representing an increase of 8.1% in comparison to the same period of the 2024 sales cycle, with a margin of 31.1%, compared to 32.7% in the same period of the 2024 sales cycle. This increase in Adjusted EBITDA was mainly driven by gains in operating efficiency and improvement in PDA (provision for doubtful accounts), which offset lower net revenue in the B2G segment. In 2Q25, Adjusted EBITDA totaled R$ 42 million, a 62.4% increase compared to R$ 26 million in 2Q24, mainly impacted by growth in core content and B2G.
In the 4 th quarter of 2024, which is the first quarter of 2025 sales cycle, the Company proceeded with the partial reversal of the tax contingencies, based on the opinion of its legal advisors, related to the discussions of goodwill and other subjects derived from the acquisition of the Anglo Group in 2010 and subsequent restructuring, in the total amount of R$ 532,717, comprising (i) R$ 92,558 reversals of the principal portion, which impacted positively our general and administrative expenses (ii) R$ 233,198 reversals of the income tax and social contribution, (iii) R$ 206.961 reversal of interest and fines, in the Finance result.
Gross margin decreased 2.4 p.p. in the sales cycle to date mainly due to a different sales mix and lower net revenue in the B2G segment. Complementary solutions have grown at a faster pace despite royalties being owed to the owners of certain products. Adjusted cash G&A expenses declined by 0.5 p.p. driven by workforce optimization and budgetary discipline. Commercial expenses increased by 0.6 p.p. reflecting higher expenses related to business expansion and marketing investments. Provision for doubtful accounts (PDA), decreased by 0.9 p.p. in the 2025 sales cycle, mainly due to an additional provision booked in the 2024 sales cycle for expected credit losses related to customers in mainstream brands.
Finance Results
In the second quarter of 2025, finance income totaled R$18 million, a 14% increase from R$16 million in 2Q24. In the 2025 sales cycle to date, finance income slightly decreased to R$45 million from R$46 million in the same period of the 2024 sales cycle. Finance income was positively impacted by a gain of R$207 million recorded in 4Q24, due to the reversal of finance interest on tax contingencies reverted, as mentioned above.
Finance costs in 2Q25 increased 6.5% to R$68 million, from R$64 million in 2Q24. In the 2025 sales cycle to date finance cost decreased 11.3% compared to the same period of the 2024 sales cycle driven by the reduction of the interest on provision for tax, civil and labor risks as a result of the reversal of tax contingencies recorded in 4Q24.
Net profit (loss)
In the second quarter of 2025, adjusted net losses totaled R$29 million, a 21.8% reduction compared to losses of R$37 million in 2Q24. In the 2025 sales cycle to date, adjusted net profit reached R$111 million, a 1.4% increase from R$110 million in the same period of the 2024 sales cycle.
Accounts receivable and PDA
The average payment term of Vasta's accounts receivable portfolio was 153 days in 2Q25, remaining stable in the same quarter of the previous year, and 35 days lower compared to 1Q25.
Free cash flow
Free cash flow (FCF) totaled R$80 million in 2Q25, a 108% increase from R$38 million in 2Q24. In the 2025 sales cycle to date, FCF totaled R$224 million, a R$134 million increase from R$90 million in the same period of the 2024 sales cycle. The last twelve-month (LTM) FCF/Adjusted EBITDA conversion rate improved from 31.9% to 57.7% as a result of Vasta's growth and implementation of sustained efficiency measures.
These measures include certain improvements in our collection processes, including automation, reminders and past-due notifications, customer segmentation, and faster renegotiation of overdue receivables. On the payments side, we implemented several initiatives to enhance discipline in payments, such as rigorous financial planning, centralized payments scheduling, and negotiating longer payment terms with suppliers. Additionally, the first semester of 2025 benefited from early collections relative to the 2025 sales cycle, which are expected to normalize throughout the next quarters of the year.
Financial leverage
As of the end of 2Q25, Vasta had a net debt position of R$917 million, a R$46 million decrease compared to 4Q24, mainly due to positive FCF generation, compensated by financial interest costs. Compared to 2Q24, the net debt decreased R$ 146 million. The net debt/LTM adjusted EBITDA as of 1.90x shows a downward trend, being 0.38x less than as of 2Q24.
ESG
Sustainability Report
In July 2025, we disclosed Vasta´s fourth sustainability report regarding the year of 2024 and it was prepared in accordance with international standards and the implementation of our corporate strategy, challenges, and achievements, while also reaffirming our commitment to transparency and sustainability. These include the publication of Greenhouse Gas Inventory (carried out since 2020), the maintenance of the FSC certifications (since 2008), the SOMOS Institute, devoted to building a more equitable society by creating opportunities for all who believe in the power of education, and 43% of our Board members belonging to underrepresented groups (women and LGBTQIAPN+).
The report complies with the Global Reporting Initiative (GRI) 2021 version and considers other standards recognized in Brazil and abroad, such as the Sustainability Accounting Standards Board (SASB) guidelines for the education sector, the guidelines of the IBC Stakeholder Capitalism Metrics from the World Economic Forum, and the principles of the International Integrated Reporting Council (IIRC).
The document is available at: https://ir.vastaplatform.com/esg/. Information contained in, or accessible through, our website is not incorporated by reference in, and does not constitute a part of, this press release.
In line with the topics identified in the materiality process, every quarter we present Vasta's most material indicators:
Key Indicators
ENVIRONMENT
Water withdrawal 1
SDGs
GRI
Disclosure
Unit
2Q2025
2Q2024
% HA
1Q2025
% HA
3, 11, 12
303-3
Total water
withdrawal
m 3
6,362
3,039
109%
7,343
(13%)
Municipal water
supply 1
%
100%
100%
0 p.p.
100%
0 p.p.
Groundwater
%
0%
0%
0 p.p.
0%
0 p.p.
Energy consumption within the organization 2
SDGs
GRI
Disclosure
Unit
2Q2025
2Q2024
% HA
1Q2025
% HA
12, 13
302-1
Total energy
consumption
GJ
2,809
3,856
(27%)
3,384
(17%)
Energy from
renewable sources 2
%
63%
52%
11 p.p.
66%
(3 p.p.)
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The increase in energy consumption this quarter was expected, as the variation reflects the production schedule of our distribution centers. At educational facilities, the increase aligns with the end of the school break period, with higher occupancy levels at the units.
SOCIAL
Diversity in workforce by employee category
SDGs
GRI
Disclosure
Unit
2Q2025
2Q2024
% HA
1Q2025
% HA
5
405-1
C-level – Women
%
22%
29%
(7 p.p.)
22%
0 p.p.
C-level – Men
%
78%
71%
7 p.p.
78%
0 p.p.
C-level- total 4
no.
9
7
29%
9
0.0%
Leadership (≥ managers)
– Women
%
41%
43%
(2 p.p.)
44%
(3 p.p.)
Total - Leadership (≥ managers)
– Men
%
59%
57%
2 p.p.
56%
3 p.p.
Leadership (≥ managers) 5
– total
no.
123
124
(1%)
124
(1%)
Academic staff – Women
%
27%
15%
12 p.p.
28%
(1 p.p.)
Academic staff – Men
%
73%
85%
(12 p.p.)
72%
1 p.p.
Academic staff 6
– total
no.
93
75
24%
96
(3%)
Administrative/Operational
– Women
%
55%
54%
1 p.p.
54%
1 p.p.
Administrative/Operational
– Male
%
45%
46%
(1 p.p.)
46%
(1 p.p.)
Administrative/Operational 7
– total
no.
1,253
1,229
2%
1,229
2%
Employees – Women
%
52%
51%
1 p.p.
51%
1 p.p.
Employees – Men
%
48%
49%
(1 p.p.)
49%
(1 p.p.)
Employees – total
no.
1,478
1,435
3%
1,458
1%
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We are proud to receive recognition as one of the Best Companies to Work For® 2024/2025 by Great Place to Work. This achievement represents much more than a certification: it validates our commitment and continuous efforts in building an organizational environment of excellence. Through initiatives focused on human development and employee wellbeing, we demonstrate that caring for people is a fundamental pillar of our corporate strategy, reinforcing our dedication to foster professional growth and personal fulfillment for all our team members.
We continue to maintain the Somos Futuro Program via Instituto SOMOS. The initiative enables public school students to attend high school at one of Vasta's partner schools. In this quarter, 227 young people were studying through the program, receiving didactic and paradidactic material, online school tutoring, mentoring, and access to the entire support network of the program, which includes psychological monitoring, in addition to the scholarship offered by the school.
During the quarter, we conducted the April Green Workshop, which engaged employees in topics related to contractor hiring procedures and third-party management, as well as safety protocols for high-risk activities and workplace safety best practices. Other significant initiatives during this period included the production of the "Lifestyle" podcast and the World Health Day campaign titled "Preventing Disease and Taking Care of You'. Additionally, the increase in the number of trained employees is attributed to the mandatory training renewal schedule, which is conducted according to the recycling periods established by regulatory standards.
GOVERNANCE
Ethical conduct
SDGs
GRI
Disclosure
Unit
2Q2025
2Q2024
% HA
1Q2025
% HA
16
2-25
Cases recorded in our
Confidential Ethics
Hotline 13
no.
32
21
52%
17
88%
10
406-1
Grievances regarding
discrimination received
through our Confidential
Ethics Hotline 13
no.
1
2
(50%)
1
0%
Confirmed incidents of
discrimination 13
no.
0
0
0%
0
0%
5
405-1
Employees who have
received training on
anti-corruption policies
and procedures
%
100%
100%
0 p.p.
100%
0 p.p.
Operations assessed for
risks related to
corruption
%
100%
100%
0 p.p.
100%
0 p.p.
Confirmed incidents of
corruption
no.
0
0
0%
0
0%
Expand
During the quarter, we recorded a significant increase in the number of reports due to intensified communication and awareness around the Cogna Confidential Channel (CCC), which was integrated into the Ombudsman Portal. This strategy facilitated access to the Channel, allowing requesters to be redirected to the CCC even when initial contact occurs through the ombudsman's office.
We did not record significant sanctions or fines related to economic and social issues, except for the normal course of business.
The Privacy Portal underwent a migration process to the Compliance section of the Cogna website. As a result, there was a slight reduction in the volume of cases received through the Portal, which are now primarily related to data subjects' rights as provided under Brazil's General Data Protection Law (LGPD). Due to the enrollment period, which occurs at the beginning of the year, there was a decrease in complaints received compared to last quarter.
FOOTNOTES
SDG
Sustainable Development Goal. Indicates goal to which the actions monitored contribute.
GRI
Global Reporting Initiative. Lists the GRI standard indicators related to the data monitored.
ND
Indicator discontinued or not measured in the quarter.
NM
Not meaningful
1
Based on invoices from sanitation concessionaires.
2
Acquired from the free energy market.
3
n.a.
4
Takes into the account the positions of CEO, vice presidents and director reporting directly to the CEO
5
Management, senior management and leadership positions not reporting directly to the CEO
6
Course coordinators, teachers, and tutors.
7
Corporate coordination, specialists, adjuncts, assistants and analysts.
8
Indicators reported on semi-annual basis (2Q and 4Q).
9
Total hours of training/employees trained.
10
Total accidents (with and without leave)/ Total man/hours worked (MHW) x 1,000,000
11
Work-related injury (excluding fatalities) from which the worker cannot recover fully to pre-injury health status within 6 months. Formula: Number of injuries/MHW x 1.000.000.
12
Fatalities/ MHW x 1,000,000.
13
Indicators measured from the first quarter of 2023. It used to be reported annually in Sustainability Reports
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CONFERENCE CALL INFORMATION
Vasta will discuss its second quarter of 2025 results on August 6, 2025, via a conference call at 5:00 p.m. Eastern Time. To access the call (ID: 3871721), please dial: +1 (888) 660-6819 or +1 (929) 203-1989. A live and archived webcast of the call will be available on the Investor Relations section of the Company's website at https://ir.vastaplatform.com. Information contained in, or accessible through, our website is not incorporated by reference in, and does not constitute a part of, this press release.
ABOUT VASTA
Vasta is a leading, high-growth education company in Brazil powered by technology, providing end-to-end educational and digital solutions that cater to all needs of private schools operating in the K-12 educational segment, ultimately benefiting all of Vasta's stakeholders, including students, parents, educators, administrators, and private school owners. Vasta's mission is to help private K-12 schools to be better and more profitable, supporting their digital transformation. Vasta believes it is uniquely positioned to help schools in Brazil undergo the process of digital transformation and bring their education skill set to the 21st century. Vasta promotes the unified use of technology in K-12 education with enhanced data and actionable insight for educators, increased collaboration among support staff and improvements in production, efficiency and quality. For more information, please visit ir.vastaplatform.com. Information contained in, or accessible through, our website is not incorporated by reference in, and does not constitute a part of, this press release.
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements that can be identified by the use of forward-looking words such as 'anticipate,' 'believe,' 'could,' 'expect,' 'should,' 'plan,' 'intend,' 'estimate' and 'potential,' among others. Forward-looking statements appear in a number of places in this press release and include, but are not limited to, statements regarding our intent, belief or current expectations. Forward-looking statements are based on our management's beliefs and assumptions and on information currently available to our management. Such statements are subject to risks and uncertainties, and actual results may differ materially from those expressed or implied in the forward-looking statements due to of various factors, including (i) general economic, financial, political, demographic and business conditions in Brazil, as well as any other countries we may serve in the future and their impact on our business; (ii) fluctuations in interest, inflation and exchange rates in Brazil and any other countries we may serve in the future; (iii) our ability to implement our business strategy and expand our portfolio of products and services; (iv) our ability to adapt to technological changes in the educational sector; (v) the availability of government authorizations on terms and conditions and within periods acceptable to us; (vi) our ability to continue attracting and retaining new partner schools and students; (vii) our ability to maintain the academic quality of our programs; (viii) the availability of qualified personnel and the ability to retain such personnel; (ix) changes in the financial condition of the students enrolling in our programs in general and in the competitive conditions in the education industry; (x) our capitalization and level of indebtedness; (xi) the interests of our controlling shareholder; (xii) changes in government regulations applicable to the education industry in Brazil; (xiii) government interventions in education industry programs, that affect the economic or tax regime, the collection of tuition fees or the regulatory framework applicable to educational institutions; (xiv) cancellations of contracts within the solutions we characterize as subscription arrangements or limitations on our ability to increase the rates we charge for the services we characterize as subscription arrangements; (xv) our ability to compete and conduct our business in the future; (xvi) our ability to anticipate changes in the business, changes in regulation or the materialization of existing and potential new risks; (xvii) the success of operating initiatives, including advertising and promotional efforts and new product, service and concept development by us and our competitors; (xviii) changes in consumer demands and preferences and technological advances, and our ability to innovate to respond to such changes; (xix) changes in labor, distribution and other operating costs; our compliance with, and changes to, government laws, regulations and tax matters that currently apply to us; (xx) the effectiveness of our risk management policies and procedures, including our internal control over financial reporting; (xxi) health crises, including due to pandemics such as the COVID-19 pandemic and government measures taken in response thereto; (xxii) other factors that may affect our financial condition, liquidity and results of operations; and (xxiii) other risk factors discussed under 'Risk Factors'. Forward-looking statements speak only as of the date they are made, and we do not undertake any obligation to update them in light of new information or future developments or to release publicly any revisions to these statements in order to reflect later events or circumstances or to reflect the occurrence of unanticipated events.
NON-GAAP FINANCIAL MEASURES
This press release presents our EBITDA, Adjusted EBITDA and Adjusted net (loss) profit and Free cash flow (FCF), which is information provided for the convenience of investors. EBITDA and Adjusted EBITDA are among the key performance indicators used by us to measure financial operating performance. Our management believes that these Non-GAAP financial measures provide useful information to investors and shareholders. We also use these measures internally to establish budgets and operational goals to manage and monitor our business, evaluate our underlying historical performance and business strategies and to report our results to the board of directors.
We calculate EBITDA as net (loss) profit for the period/year plus income taxes and social contribution plus/minus net finance result plus depreciation and amortization. The EBITDA measure provides useful information to assess our operational performance.
We calculate Adjusted EBITDA as EBITDA plus/minus: (a) income tax and social contribution; (b) net finance result; (c) depreciation and amortization; (d) share-based compensation expenses, mainly due to the grant of additional shares to Somos' employees in connection with the change of control of Somos to Cogna (for further information refer to note 23 to the audited consolidated financial statements); (e) provision for risks of tax, civil and labor losses regarding penalties, related to income tax positions taken by the Predecessor Somos – Anglo and Vasta in connection with a corporate reorganization carried out by the Predecessor Somos – Anglo; (f) Bonus IPO, which refers to bonus paid to certain executives and employees based on restricted share units; and (g) expenses with contractual termination of employees due to organizational restructuring. We understand that such adjustments are relevant and should be considered when calculating our Adjusted EBITDA, which is a practical measure to assess our operational performance that allows us to compare it with other companies that operates in the same segment.
We calculate Adjusted net (loss) profit as the (loss) profit for the period/year as presented in Statement of Profit or Loss and Other Comprehensive Income adjusted by the same Adjusted EBITDA items, however, added by (a) Amortization of intangible assets from Business Combination and (b) Tax shield of 34% generated by the aforementioned adjustments.
We calculate Free cash flow (FCF) as the cash from operating activities as presented in the Statement of Cash Flows less (a) income tax and social contribution paid; (b) tax, civil and labor proceedings paid; (c) interest lease liabilities paid; (d) acquisition of property, plant and equipment; (e) additions to intangible assets; and (f) lease liabilities paid.
We understand that, although Adjusted net (loss) profit, EBITDA, Adjusted EBITDA, and Free cash flow (FCF) are used by investors and securities analysts in their evaluation of companies, these measures have limitations as analytical tools, and you should not consider them in isolation or as substitutes for analysis of our results of operations as reported under IFRS. Additionally, our calculations of Adjusted net (loss) profit, Adjusted EBITDA, and Free cash flow (FCF) may be different from the calculation used by other companies, including our competitors in the education services industry, and therefore, our measures may not be comparable to those of other companies.
Our main deliveries of printed and digital materials to our customers occur in the last quarter of each year (typically in November and December), and in the first quarter of each subsequent year (typically in February and March), and revenue is recognized when the customers obtain control over the materials. In addition, the printed and digital materials we provide in the fourth quarter are used by our customers in the following school year and, therefore, our fourth quarter results reflect the growth in the number of our students from one school year to the next, leading to higher revenue in general in our fourth quarter compared with the preceding quarters in each year. Consequently, in aggregate, the seasonality of our revenues generally produces higher revenues in the first and fourth quarters of our fiscal year. Thus, the numbers for the second quarter and third quarter are usually less relevant. In addition, we generally bill our customers during the first half of each school year (which starts in January), which generally results in a higher cash position in the first half of each year compared to the second half.
A significant part of our expenses is also seasonal. Due to the nature of our business cycle, we need significant working capital, typically in September or October of each year, to cover costs related to production and inventory accumulation, selling and marketing expenses, and delivery of our teaching materials at the end of each year in preparation for the beginning of each school year. As a result, these operating expenses are generally incurred between September and December of each year.
Purchases through our Livro Fácil e-commerce platform are also very intense during the back-to-school period, between November, when school enrollment takes place and families plan to anticipate the purchase of products and services, and February of the following year, when classes are about to start. Thus, e-commerce revenue is mainly concentrated in the first and fourth quarters of the year.
KEY BUSINESS METRICS
Annual Contract Value, or ACV, is a non-accounting managerial metric and represents our partner schools' commitment to pay for our solutions offerings. We believe it is a meaningful indicator of demand for our solutions. We consider ACV is a helpful metric because it is designed to show amounts that we expect to be recognized as revenue from subscription services for the 12-month period between October 1 of one fiscal year through September 30 of the following fiscal year. We define ACV as the revenue we would expect to recognize from a partner school in each school year, based on the number of students who have contracted our services, or 'enrolled students,' that will access our content at such partner school in such school year. We calculate ACV by multiplying the number of enrolled students at each school with the average ticket per student per year; the related number of enrolled students and average ticket per student per year are each calculated in accordance with the terms of each contract with the related school. Although our contracts with our schools are typically for 4-year terms, we record one year of revenue under such contracts as ACV. ACV is calculated based on the sum of actual contracts signed during the sales period and assumes the historical rates of returned goods from customers for the preceding 24-month period. Since the actual rates of returned goods from sales during the period may be different from the historical average rates and the actual volume of merchandise ordered by our customers may be different from the contracted amount, the actual revenue recognized during each period of a sales cycle may be different from the ACV for the respective sales cycle. Our reported ACV is subject to risks associated with, among other things, economic conditions and the markets in which we operate, including risks that our contracts may be canceled or adjusted.
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YETI Reports Second Quarter 2025 Results
AUSTIN, Texas--(BUSINESS WIRE)--YETI Holdings, Inc. ('YETI') (NYSE: YETI) today announced its financial results for the second quarter ended June 28, 2025. YETI reports its financial performance in accordance with accounting principles generally accepted in the United States of America ('GAAP') and as adjusted on a non-GAAP basis. Please see 'Non-GAAP Financial Measures' and 'Reconciliation of GAAP to Non-GAAP Financial Information' below for additional information and reconciliations of the non-GAAP financial measures to the most comparable GAAP financial measures. Second Quarter 2025 Highlights Net sales decreased 4%, reflecting a more promotional drinkware market environment, caution from consumers and our retail partners, and inventory constraints driven by our supply chain transition. EPS increased 3% to $0.61; Adjusted EPS decreased 6% to $0.66, inclusive of $0.07 net impact of higher tariff costs in the second quarter of 2025 Repurchased 0.7 million shares for $23 million Matt Reintjes, President and Chief Executive Officer, commented, 'We are making excellent progress on our long-term strategic priorities—accelerating innovation, expanding our global brand, and diversifying our supply chain. We are seeing these strategies play out in the market with momentum in product innovation and diversification across our portfolio with notable strength in bags, our global expansion with exceptional performance in the UK and Europe and strong end user demand in Canada and Australia, and the transformational shift in our supply chain. Our brand continues to expand, connecting both domestically and, importantly, globally. Amidst a disruptive macroeconomic environment, we are positioning YETI to deliver long-term, sustainable top and bottom-line growth supported by a strong financial foundation. Our strong balance sheet and robust free cash flow generation are enabling investment in growth initiatives while also advancing our capital allocation priorities, including share repurchases. We exited the second quarter with encouraging momentum across our key growth drivers, and we are seeing signs of continued improvement in the third quarter, reinforcing our confidence in the trajectory ahead.' Second Quarter 2025 Results Sales and adjusted sales both decreased 4% to $445.9 million, compared to $463.5 million during the same period last year. Direct-to-consumer ('DTC') channel sales decreased 1% to $248.6 million, compared to $250.4 million in the prior year quarter. Wholesale channel sales decreased 7% to $197.3 million, compared to $213.1 million in the same period last year, due to a decline in both Drinkware and Coolers & Equipment. Drinkware sales decreased 4% to $236.4 million, compared to $246.5 million in the prior year quarter. As expected, Drinkware growth in our international regions was more than offset by a decline in our U.S. region, reflecting a challenging market and inventory constraints driven by our supply chain transition. Coolers & Equipment sales decreased 3% to $200.6 million, compared to $205.9 million in the same period last year. Growth in hard coolers was more than offset by a decline in soft coolers during the quarter. Sales in the U.S. decreased 5% to $367.8 million, compared to $386.9 million in the prior year quarter. International sales rose 2% to $78.1 million, compared to $76.6 million in the prior year quarter reflecting strong growth in Europe and our launch in Japan. This was partially offset by conservative inventory purchases and caution from our wholesale partners in other international regions against robust consumer demand. Gross profit decreased 3% to $257.6 million, or 57.8% of sales, compared to $264.3 million, or 57.0% of sales, in the second quarter of 2024. The 80 basis points increase in gross margin was primarily due to lower product costs, selective price increases implemented in the second quarter of 2025 and the absence in the current year quarter of purchase accounting inventory step-up amortization, partially offset by higher tariff costs. Adjusted gross profit decreased 4% to $257.6 million, or 57.8% of adjusted sales, compared to $267.5 million, or 57.7% of adjusted sales, in the second quarter of 2024. The 10 basis points increase in adjusted gross margin was primarily due to lower product costs and selective price increases implemented in the second quarter of 2025, partially offset by higher tariffs. Selling, general, and administrative ('SG&A') expenses decreased 1% to $195.5 million, compared to $196.9 million in the second quarter of 2024. As a percentage of sales, SG&A expenses increased 140 basis points to 43.9% from 42.5% in the prior year period. This increase was primarily due to higher technology expenses related to our growth investments. Adjusted SG&A expenses decreased 2% to $184.4 million, compared to $187.5 million in the second quarter of 2024. As a percentage of adjusted sales, adjusted SG&A expenses increased 80 basis points to 41.3% from 40.5% in the prior year period. This increase was primarily due to higher technology expenses related to our growth investments, partially offset by lower employee costs. Operating income decreased 8% to $62.0 million, or 13.9% of sales, compared to $67.4 million, or 14.5% of sales during the prior year quarter. Adjusted operating income decreased 9% to $73.2 million, or 16.4% of adjusted sales, compared to $80.0 million, or 17.3% of adjusted sales during the same period last year. Other income increased to $5.8 million compared to other income of $0.4 million in the second quarter of 2024, primarily due to higher foreign currency gains related to intercompany balances in the current year. Net income increased 1% to $51.2 million, or 11.5% of sales, compared to $50.4 million, or 10.9% of sales in the prior year quarter; Net income per diluted share increased 3% to $0.61, compared to $0.59 in the prior year quarter. Adjusted net income decreased 7% to $55.2 million, or 12.4% of adjusted sales, compared to $59.6 million, or 12.9% of adjusted sales in the prior year quarter; Adjusted net income per diluted share decreased 6% to $0.66, compared to $0.70 per diluted share in the prior year quarter. Six Months Ended June 28, 2025 Results Sales and adjusted sales both decreased 1% to $797.0 million, compared to $804.9 million in the prior year period. DTC channel sales increased 2% to $444.8 million, compared to $438.2 million in the prior year period, primarily due to growth in Coolers & Equipment. Wholesale channel sales decreased 4% to $352.2 million, compared to $366.7 million in the same period last year, primarily due to a decline in Drinkware, partially offset by growth in Coolers & Equipment. Drinkware sales decreased 4% to $442.0 million, compared to $461.1 million in the prior year period. Drinkware growth in our international regions was more than offset by a decline in our U.S. region, reflecting a challenging market, and inventory constraints driven by our supply chain transition. Coolers & Equipment sales increased 5% to $340.8 million, compared to $325.8 million in the same period last year, primarily driven by strong performance in bags and hard coolers, partially offset by a decline in soft coolers. Sales in the U.S. decreased 4%, to $639.0 million, compared to $662.7 million in the prior year period. International sales increased 11%, to $158.0 million, compared to $142.2 million in the prior year period reflecting strong growth in Europe, Canada and our launch in Japan. The 11% increase in international sales included an FX headwind of approximately 260 basis points. Gross profit increased to $459.3 million, or 57.6% of sales, compared to $459.1 million, or 57.0% of sales, in the prior year period. The 60 basis points increase in gross margin was primarily due to lower product costs, the absence in the current year quarter of purchase accounting inventory step-up amortization, and selective price increases implemented in the second quarter of 2025, partially offset by higher tariff costs and lower mix of our Drinkware category. Adjusted gross profit decreased 1% to $458.9 million, compared to $463.9 million, in the prior year period. Adjusted gross margin was flat at 57.6%, compared to the prior year period. Lower product costs and selective price increases implemented in the second quarter of 2025 were offset by higher tariff costs and lower mix of our Drinkware category. SG&A expenses increased 3% to $375.6 million, compared to $365.9 million in the prior year period. As a percentage of sales, SG&A expenses increased 160 basis points to 47.1% from 45.5% in the prior year period. This increase was primarily due to higher technology expenses related to our growth investments, and higher employee costs related to non-cash stock-based compensation. Adjusted SG&A expenses increased 2% to $350.5 million, compared to $344.3 million in the prior year period. As a percentage of adjusted sales, adjusted SG&A expenses increased by 120 basis points to 44.0% from 42.8% in the prior year period. This increase was primarily due to higher technology expenses, related to our growth investments. Operating income decreased 10% to $83.7 million, or 10.5% of sales, compared to $93.2 million, or 11.6% of sales during the prior year period. Adjusted operating income decreased 9% to $108.4 million, or 13.6% of adjusted sales, compared to $119.6 million, or 14.9% of adjusted sales during the same period last year. The 9% decrease in adjusted operating income included an FX headwind of approximately 210 basis points. Other income of $7.1 million compared to other expense of $3.7 million in the prior year period, primarily due to foreign currency gains related to intercompany balances in the current year period versus foreign currency losses on intercompany balances in the prior year period. Net income increased 2% to $67.8 million, or 8.5% of sales, compared to $66.3 million, or 8.2% of sales in the prior year period; Net income per diluted share increased 5% to $0.81, compared to $0.77 in the prior year period. Adjusted net income decreased 9% to $81.0 million, or 10.2% of adjusted sales, compared to $88.9 million, or 11.0% of adjusted sales in the prior year period; Adjusted net income per diluted share decreased 6% to $0.97, compared to $1.03 per diluted share in the prior year period. Adjusted net income per diluted share included an FX headwind of approximately $0.02 or 220 basis points of growth. Balance Sheet and Liquidity Review Cash was $269.7 million, total debt, excluding finance leases and unamortized deferred financing fees, was $75.9 million, and our $300 million Revolving Credit Facility remained undrawn as of the end of the second quarter of 2025. Inventory decreased 10% to $342.1 million, compared to $378.3 million at the end of the prior year quarter. Capital Allocation Update Pursuant to our existing $450 million share repurchase authorization, in the second quarter of 2025, we repurchased approximately 745,000 shares of YETI's common stock on the open market for $23.0 million. Based on our current expectations, we anticipate completing approximately $200 million in share repurchases during 2025. In addition, in August 2025, we acquired certain assets, including designs, tooling, and intellectual property, related to a shaker bottle for $38 million in cash. Updated 2025 Outlook Mr. Reintjes concluded, 'Our confidence in the business and the underlying operating fundamentals supporting our full-year outlook remains unchanged. I'm particularly pleased with the execution on our ongoing supply chain transition which will meaningfully diversify our footprint and capabilities, positioning us for continued expansion and innovation driving long-term success. We are modestly lowering our top-line expectations to reflect a slightly more prolonged recovery in drinkware in the U.S. At the same time, we are raising our EPS outlook, primarily due to our strong operating execution and reflecting tariff reduction on China-sourced products, partially offset by increased tariffs on imports from other regions. As we look to the second half of 2025, we remain incredibly excited about the innovation we have planned, the continued strength and momentum of our brand, and the global opportunities we see in front of us.' For Fiscal 2025, a 53-week period, compared to a 52-week period in Fiscal 2024, YETI expects: Adjusted sales to be flat to up 2% (versus previous outlook of between 1% and 4%) including an approximately 300 basis point unfavorable impact from supply chain disruptions; Adjusted operating income as a percentage of adjusted sales between 14.0% and 14.5% (versus previous outlook of 12.0%). This outlook reflects an approximate 220 basis point net impact from higher tariff costs versus the prior year; An effective tax rate of approximately 25.5% (versus previous outlook of 26.0%; compared to 24.5% in the prior year period); Adjusted net income per diluted share between $2.34 and $2.48 (versus previous outlook of between $1.96 and $2.02) including an approximately $0.40 net unfavorable impact from higher tariff costs; Diluted weighted average shares outstanding of approximately 82.0 million (versus previous outlook of 83.7 million); Capital expenditures of approximately $50 million (versus previous outlook of $60 million), primarily to support investments in technology, new product innovation, and our supply chain; and Free cash flow between $150 million and $200 million (versus previous outlook of between $100 million and $125 million). Conference Call Details A conference call to discuss the second quarter of 2025 financial results is scheduled for today, August 7, 2025, at 8:00 a.m. Eastern Time. Investors and analysts interested in participating in the call are invited to dial 800-717-1738 (international callers, please dial 646-307-1865) approximately 10 minutes prior to the start of the call. A live audio webcast of the conference call will be available online at A replay will be available through August 21, 2025 by dialing 844-512-2921 (international callers, 412-317-6671). The accompanying access code for this call is 1166514. About YETI Holdings, Inc. Headquartered in Austin, Texas, YETI is a global designer, retailer, and distributor of innovative outdoor products. From coolers and drinkware to bags and apparel, YETI products are built to meet the unique and varying needs of diverse outdoor pursuits, whether in the remote wilderness, at the beach, or anywhere life takes you. By consistently delivering high-performing, exceptional products, we have built a strong following of brand loyalists throughout the world, ranging from serious outdoor enthusiasts to individuals who simply value products of uncompromising quality and design. We have an unwavering commitment to outdoor and recreation communities, and we are relentless in our pursuit of building superior products for people to confidently enjoy life outdoors and beyond. For more information, please visit Non-GAAP Financial Measures In addition to our results determined in accordance with GAAP, we supplement our results with non-GAAP financial measures, including adjusted net sales, adjusted gross profit, adjusted gross margin, adjusted SG&A expenses, adjusted operating income, adjusted net income, adjusted net income per diluted share (which we also refer to as adjusted EPS), free cash flow as well as adjusted gross profit, adjusted SG&A expenses, adjusted operating income and adjusted net income as a percentage of adjusted net sales. Our management uses these non-GAAP financial measures in conjunction with GAAP financial measures to measure our profitability and to evaluate our financial performance. We believe that these non-GAAP financial measures provide meaningful supplemental information regarding the underlying operating performance of our business and are appropriate to enhance an overall understanding of our financial performance. These non-GAAP financial measures have limitations as analytical tools in that they do not reflect all of the amounts associated with our results of operations as determined in accordance with GAAP. Because of these limitations, these non-GAAP financial measures should be considered along with GAAP financial performance measures. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures. A reconciliation of the non-GAAP financial measures to such GAAP measures can be found below. YETI does not provide a reconciliation of forward-looking non-GAAP to GAAP financial measures because such reconciliations are not available without unreasonable efforts. This is due to the inherent difficulty in forecasting with reasonable certainty certain amounts that are necessary for such reconciliation, including in particular the impacts of product recalls and realized and unrealized foreign currency gains and losses reported within other expense. For the same reasons, we are unable to forecast with reasonable certainty all deductions and additions needed in order to provide a forward-looking GAAP financial measures at this time. The amount of these deductions and additions may be material and, therefore, could result in forward-looking GAAP financial measures being materially different or less than forward-looking non-GAAP financial measures. See 'Forward-looking statements' below. Forward-looking statements This press release contains ''forward-looking statements'' within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical or current fact included in this press release are forward-looking statements. Forward-looking statements include statements containing words such as 'anticipate,' 'assume,' 'believe,' 'can have,' 'contemplate,' 'continue,' 'could,' 'design,' 'due,' 'estimate,' 'expect,' 'forecast,' 'goal,' 'intend,' 'likely,' 'may,' 'might,' 'objective,' 'plan,' 'predict,' 'project,' 'potential,' 'seek,' 'should,' 'target,' 'will,' 'would,' and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operational performance or other events. For example, all statements made relating to our cash generation abilities, our position to deliver sustainable top- and bottom-line growth, growth initiatives, capital allocation priorities, our share repurchase program, consumer buying behavior, inventory constraints, supply chain challenges, a promotional retail environment, the impact of tariffs, future financial performance, capital expenditures, and our expectations for opportunity, growth, and investments, including those set forth in the quotes from YETI's President and CEO, and the 2025 financial outlook provided herein, constitute forward-looking statements. All forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those that are expected and, therefore, you should not unduly rely on such statements. The risks and uncertainties that could cause actual results to differ materially from those expressed or implied by these forward-looking statements include but are not limited to: (i) economic conditions or consumer confidence in future economic conditions; (ii) our ability to maintain and strengthen our brand and generate and maintain ongoing demand for our products; (iii) our ability to successfully design, develop and market new products; (iv) our ability to effectively manage our growth; (v) our ability to expand into additional consumer markets, and our success in doing so; (vi) the success of our international expansion plans; (vii) our ability to compete effectively in the outdoor and recreation market and protect our brand; (viii) the level of customer spending for our products, which is sensitive to general economic conditions and other factors; (ix) problems with, or loss of, our third-party contract manufacturers and suppliers or an inability to obtain raw materials; (x) fluctuations in the cost and availability of raw materials, equipment, labor, and transportation and subsequent manufacturing delays or increased costs; (xi) adverse changes in international trade policies, tariffs and treaties, including increases in tariff rates and the imposition of additional tariffs; (xii) our ability to accurately forecast demand for our products and our results of operations; (xiii) our relationships with our national, regional, and independent retail partners, who account for a significant portion of our sales; (xiv) the impact of natural disasters and failures of our information technology on our operations and the operations of our manufacturing partners; (xv) the integration and use of artificial intelligence; (xvi) our ability to attract and retain skilled personnel and senior management, and to maintain the continued efforts of our management and key employees; (xvii) the impact of our indebtedness on our ability to invest in the ongoing needs of our business; and (xviii) our ability to successfully execute our share repurchase program and its impact on stockholder value and the volatility of the price of our common stock. For a more extensive list of factors that could materially affect our results, you should read our filings with the United States Securities and Exchange Commission (the 'SEC'), including our Annual Report on Form 10-K for the year ended December 28, 2024 and our Quarterly Report on Form 10-Q for the quarter ended June 28, 2025, as such filings may be amended, supplemented or superseded from time to time by other reports YETI files with the SEC. These forward-looking statements are made based upon detailed assumptions and reflect management's current expectations and beliefs. While YETI believes that these assumptions underlying the forward-looking statements are reasonable, YETI cautions that it is very difficult to predict the impact of known factors, and it is impossible for YETI to anticipate all factors that could affect actual results. The forward-looking statements included here are made only as of the date hereof. YETI undertakes no obligation to publicly update or revise any forward-looking statement as a result of new information, future events, or otherwise, except as required by law. Many of the foregoing risks and uncertainties may be exacerbated by the global business and economic environment, including ongoing geopolitical conflicts. Solely for convenience, certain trademark and service marks referred to in this press release appear without the ® or ™ symbols, but those references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights to these trademarks and service marks. YETI HOLDINGS, INC. (Unaudited) (In thousands) June 28, 2025 December 28, 2024 June 29, 2024 ASSETS Current assets Cash $ 269,673 $ 358,795 $ 212,937 Accounts receivable, net 163,595 120,190 159,050 Inventory 342,131 310,058 378,296 Prepaid expenses and other current assets 52,771 37,723 56,966 Total current assets 828,170 826,766 807,249 Property and equipment, net 138,224 126,270 131,858 Operating lease right-of-use assets 84,732 78,279 80,425 Goodwill 72,308 72,557 72,894 Intangible assets, net 176,165 172,023 136,886 Other assets 3,445 10,225 2,993 Total assets $ 1,303,044 $ 1,286,120 $ 1,232,305 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable $ 152,290 $ 158,499 $ 175,199 Accrued expenses and other current liabilities 116,803 128,210 112,138 Taxes payable 18,584 38,089 23,821 Accrued payroll and related costs 13,900 28,610 17,856 Operating lease liabilities 21,054 19,621 16,365 Current maturities of long-term debt 6,331 6,475 6,481 Total current liabilities 328,962 379,504 351,860 Long-term debt, net of current portion 70,143 72,821 75,829 Operating lease liabilities, non-current 79,455 73,586 78,217 Other liabilities 21,752 20,102 20,539 Total liabilities 500,312 546,013 526,445 Stockholders' Equity Common stock 897 892 890 Treasury stock, at cost (324,824 ) (281,587 ) (200,878 ) Additional paid-in capital 445,671 405,921 402,495 Retained earnings 681,885 614,125 504,687 Accumulated other comprehensive (loss) gain (897 ) 756 (1,334 ) Total stockholders' equity 802,732 740,107 705,860 Total liabilities and stockholders' equity $ 1,303,044 $ 1,286,120 $ 1,232,305 Expand YETI HOLDINGS, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (In thousands) Six Months Ended June 28, 2025 June 29, 2024 Cash Flows from Operating Activities: Net income $ 67,760 $ 66,251 Adjustments to reconcile net income to cash provided by (used in) operating activities: Depreciation and amortization 26,297 23,559 Amortization of deferred financing fees 321 326 Stock-based compensation 21,317 17,325 Deferred income taxes 6,968 (1,966 ) Impairment of long-lived assets — 2,025 Other (7,292 ) 2,343 Changes in operating assets and liabilities: Accounts receivable (40,769 ) (60,085 ) Inventory (28,864 ) (25,380 ) Other current assets (11,506 ) (9,946 ) Accounts payable and accrued expenses (35,560 ) (50,065 ) Taxes payable (18,572 ) (13,503 ) Other 799 1,402 Net cash used in operating activities (19,101 ) (47,714 ) Cash Flows from Investing Activities: Purchases of property and equipment (19,943 ) (21,636 ) Business acquisition, net of cash acquired — (36,164 ) Additions of intangibles, net (11,143 ) (14,635 ) Net cash used in investing activities (31,086 ) (72,435 ) Cash Flows from Financing Activities: Repayments of long-term debt (2,109 ) (2,109 ) Taxes paid in connection with employee stock transactions (1,563 ) (1,202 ) Payments of finance lease obligations (12,150 ) (2,491 ) Repurchases of common stock (22,984 ) (100,000 ) Excise tax paid on repurchases of common stock (1,562 ) — Net cash used in financing activities (40,368 ) (105,802 ) Effect of exchange rate changes on cash 1,433 (72 ) Net decrease in cash (89,122 ) (226,023 ) Cash, beginning of period 358,795 438,960 Cash, end of period $ 269,673 $ 212,937 Expand YETI HOLDINGS, INC. Supplemental Financial Information (Unaudited) (In thousands) Three Months Ended Six Months Ended June 28, 2025 June 29, 2024 June 28, 2025 June 29, 2024 Net sales $ 445,892 $ 463,499 $ 797,020 $ 804,893 Product recall (1) — — — — Adjusted net sales $ 445,892 $ 463,499 $ 797,020 $ 804,893 Gross profit $ 257,569 $ 264,306 $ 459,291 $ 459,119 Transition costs (2) — 3,208 (395 ) 4,755 Adjusted gross profit $ 257,569 $ 267,514 $ 458,896 $ 463,874 Selling, general, and administrative expenses $ 195,545 $ 196,886 $ 375,596 $ 365,882 Non-cash stock-based compensation expense (11,173 ) (8,828 ) (21,317 ) (17,325 ) Long-lived asset impairment — — — (2,025 ) Organizational realignment costs (3) — — (994 ) (1,122 ) Stockholder matters (4) — — (2,760 ) — Transition costs (5) — (140 ) — (682 ) Business optimization expense (6) — (415 ) — (415 ) Adjusted selling, general, and administrative expenses $ 184,372 $ 187,503 $ 350,525 $ 344,313 Gross margin 57.8 % 57.0 % 57.6 % 57.0 % Adjusted gross margin 57.8 % 57.7 % 57.6 % 57.6 % SG&A expenses as a % of net sales 43.9 % 42.5 % 47.1 % 45.5 % Adjusted SG&A expenses as a % of adjusted net sales 41.3 % 40.5 % 44.0 % 42.8 % Expand (1) Represents adjustments and charges associated with product recalls. (2) Represents a favorable true-up of estimated disposal costs in connection with the acquisition of Mystery Ranch, LLC for the six months ended June 28, 2025. Represents inventory step-up costs and inventory disposal costs in connection with the acquisition of Mystery Ranch, LLC for the three and six months ended June 29, 2024. (3) Represents employee severance costs in connection with strategic organizational realignments. (4) Represents advisory and legal fees related to a stockholder matter that resulted in a cooperation agreement signed in March 2025. (5) Represents transition costs in connection with the acquisition of Mystery Ranch, LLC, including third-party business integration costs. (6) Represents start-up, transition and integration costs associated with our new distribution facility in the United Kingdom. Expand YETI HOLDINGS, INC. Supplemental Financial Information (Unaudited) (In thousands, except per share amounts) Three Months Ended Six Months Ended June 28, 2025 June 29, 2024 June 28, 2025 June 29, 2024 Operating income $ 62,024 $ 67,420 $ 83,695 $ 93,237 Adjustments: Non-cash stock-based compensation expense (1) 11,173 8,828 21,317 17,325 Long-lived asset impairment (1) — — — 2,025 Organizational realignment costs (1)(2) — — 994 1,122 Business optimization expense (1)(5) — 415 — 415 Transition costs (3) — 3,348 (395 ) 5,437 Shareholder matters (4) — — 2,760 — Adjusted operating income $ 73,197 $ 80,011 $ 108,371 $ 119,561 Net income $ 51,151 $ 50,396 $ 67,760 $ 66,251 Adjustments: Non-cash stock-based compensation expense (1) 11,173 8,828 21,317 17,325 Long-lived asset impairment (1) — — — 2,025 Organizational realignment costs (1)(2) — — 994 1,122 Business optimization expense (1)(5) — 415 — 415 Transition costs (3) — 3,348 (395 ) 5,437 Shareholder matters (4) — — 2,760 — Other (income) expense, net (6) (5,773 ) (391 ) (7,149 ) 3,710 Tax impact of adjusting items (7) (1,323 ) (2,989 ) (4,294 ) (7,358 ) Adjusted net income $ 55,228 $ 59,607 $ 80,993 $ 88,927 Net sales $ 445,892 $ 463,499 $ 797,020 $ 804,893 Adjusted net sales $ 445,892 $ 463,499 $ 797,020 $ 804,893 Operating income as a % of net sales 13.9 % 14.5 % 10.5 % 11.6 % Adjusted operating income as a % of adjusted net sales 16.4 % 17.3 % 13.6 % 14.9 % Net income as a % of net sales 11.5 % 10.9 % 8.5 % 8.2 % Adjusted net income as a % of adjusted net sales 12.4 % 12.9 % 10.2 % 11.0 % Net income per diluted share $ 0.61 $ 0.59 $ 0.81 $ 0.77 Adjusted net income per diluted share $ 0.66 $ 0.70 $ 0.97 $ 1.03 Weighted average shares outstanding used to compute adjusted net income per diluted share 83,463 85,468 83,503 86,313 Expand (1) These costs are reported in SG&A expenses. (2) Represents employee severance costs in connection with strategic organizational realignments. (3) Represents a favorable true-up of estimated disposal costs in connection with the acquisition of Mystery Ranch, LLC for the six months ended June 28, 2025. Represents transition costs, inventory step-up and inventory disposal costs, and third-party business integration costs in connection with the acquisition of Mystery Ranch, LLC for the three and six months ended June 29, 2024. (4) Represents advisory and legal fees related to a stockholder matter that resulted in a cooperation agreement signed in March 2025. (5) Represents start-up, transition and integration costs associated with our new distribution facility in the United Kingdom. (6) Other (income) expense, net substantially consists of realized and unrealized foreign currency gains and losses on intercompany balances that arise in the ordinary course of business. (7) Represents the tax impact of adjustments calculated at an expected statutory tax rate of 24.5% for each of the three and six months ended June 28, 2025 and June 29, 2024. Expand Six Months Ended June 28, 2025 Six Months Ended June 29, 2024 Net Sales Product Recalls (1) Adjusted Net Sales Net Sales Product Recalls (1) Adjusted Net Sales Channel Wholesale $ 352,208 $ — $ 352,208 $ 366,697 $ — $ 366,697 Direct-to-consumer 444,812 — 444,812 438,196 — 438,196 Total $ 797,020 $ — $ 797,020 $ 804,893 $ — $ 804,893 Category Coolers & Equipment $ 340,789 $ — $ 340,789 $ 325,848 $ — $ 325,848 Drinkware 442,039 — 442,039 461,103 — 461,103 Other 14,192 — 14,192 17,942 — 17,942 Total $ 797,020 $ — $ 797,020 $ 804,893 $ — $ 804,893 Geographic Region United States $ 639,047 $ 639,048 $ 662,682 $ — $ 662,682 International 157,973 — 157,972 142,211 — 142,211 Total $ 797,020 $ — $ 797,020 $ 804,893 $ — $ 804,893 Expand (1) Represents adjustments and charges associated with product recalls. Expand YETI HOLDINGS, INC. Supplemental Financial Information (Unaudited) (In thousands) Six Months Ended June 28, 2025 June 29, 2024 Net cash used in operating activities $ (19,101 ) $ (47,714 ) Less: Purchases of property and equipment (19,943 ) (21,636 ) Free cash flow $ (39,044 ) $ (69,350 ) Expand
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Income Lab and Independent Advisor Alliance Partner to Power Personalized Retirement Planning for Advisors
DENVER--(BUSINESS WIRE)-- Income Laboratory, Inc. (Income Lab), maker of award-winning retirement planning software, today announced a strategic partnership with Independent Advisor Alliance (IAA), one of the nation's leading hybrid RIAs. This collaboration brings Income Lab's dynamic retirement planning platform to IAA's network of over 142 partner firms, offering powerful tools to support personalized retirement planning at scale. 'Income Lab delivers powerful insights through an intuitive platform, enabling advisors to offer personalized, high-quality planning at scale. It meets advisors where they are and elevates the entire client experience.' -Lauren Grames, IAA As the demand for more personalized financial planning grows, advisors are turning to Income Lab's modern platform, built to help guide clients toward retirement and address the complexities of retirement planning. 'At IAA, we're dedicated to equipping advisors with the innovative technology and support they need to build stronger client relationships and grow their businesses with confidence,' said Lauren Grames, Director of Advisor Technology. 'Income Lab delivers powerful insights through an intuitive platform, enabling advisors to offer personalized, high-quality planning at scale. It meets advisors where they are and elevates the entire client experience.' Income Lab equips advisors with intelligent tools to answer the most critical questions retirees ask: How much can I safely spend in retirement? What happens if markets, inflation, or taxes change? Which accounts should I draw from and when, to minimize taxes? Advisors can also take advantage of features like plan scenario comparisons, tax-smart withdrawal strategies, Roth conversion modeling, and Social Security optimization, all within an easy-to-use interface that enhances both the planning process and client experience. 'We're excited to partner with IAA to bring next-generation retirement planning tools to their advisor network,' said Johnny Poulsen, CEO and co-founder of Income Lab. 'We're proud to support IAA's growing advisor network and share in their commitment to delivering exceptional client experiences. Together, we're equipping advisors with modern tools that elevate the planning experience and help them deliver greater value to the clients they serve.' For more information about Income Lab's full suite of retirement planning solutions, visit About IAA Independent Advisor Alliance (IAA) is a leading hybrid firm strategically focused on empowering financial advisors to succeed as independent business owners by providing services that align with each advisor's unique needs and challenges. IAA supports its partner firms with customized support services, resources, and programs designed to optimize efficiencies, reduce expenses, retain and attract clients, assist with succession planning, boost revenue, and more. For more information, visit About Income Lab Income Lab equips financial advisors with cutting-edge software for retirement planning, ongoing retirement income management, and client engagement. With personalized, data-driven insights, advisors help clients navigate changing economic conditions and fine-tune income strategies for long-term success and tax efficiency. Income Lab has been recognized as a top retirement planning solution—named 'Best in Show' at the 2022 & 2023 XYPN Advisor Tech Expos, the 'Highest-Rated Retirement Distribution Planning Tool' in the 2023 & 2024 T3/Inside Information Survey, and a 'Stand Out' in the Report for satisfaction and value.
Business Wire
24 minutes ago
- Business Wire
ACI Worldwide, Inc. Reports Financial Results for the Quarter Ended June 30, 2025
OMAHA, Neb.--(BUSINESS WIRE)--ACI Worldwide (NASDAQ: ACIW), an original innovator in global payments technology, announced financial results today for the quarter ended June 30, 2025. ACI also increased its 2025 financial guidance. "We delivered solid second quarter and first half results, reflecting the organizational improvements we have invested in and the momentum we generated by signing renewals and new business early in the year,' said Thomas Warsop, president and CEO of ACI. 'These structural shifts have enabled us to pursue more strategic opportunities and move towards a more scalable and less seasonally weighted financial model. Looking ahead, we remain focused on increasing shareholder value through sales execution, enhancing the growth orientation across ACI, and the continued development and rollout of Connetic, our next generation payments hub platform.' 'Our momentum from last quarter continued to build in Q2, with revenue from Payment Software segment growing 18% and Biller segment growing 13% over the first half of 2024,' said Robert Leibrock, Chief Financial Officer of ACI. 'While Q2 adjusted EBITDA reflected the timing of higher-margin license contracts and renewals, our adjusted EBITDA for the first half of 2025 increased by 24% compared to the same period last year. In line with our commitment to balanced capital allocation and continued shareholder returns, we repurchased 2.4 million shares in Q2, representing 2.4% of shares outstanding. Given the robust performance across the business, we are raising our full-year outlook for both revenue and adjusted EBITDA for 2025.' Q2 AND 1H 2025 FINANCIAL SUMMARY In Q2 2025, revenue was $401 million, up 7% from Q2 2024. Recurring revenue in Q2 2025 of $322 million was up 13% from Q2 2024 and represented 80% of total revenue. Q2 2025 net income of $12 million compares to a net income of $31 million in Q2 2024. Q2 2025 adjusted EBITDA was $81 million, down 13% from Q2 2024, reflecting the timing of higher-margin license contracts this year. Q2 cash flow from operating activities was $50 million, versus $55 million in Q2 2024. In Q2 2025, Payment Software segment revenue declined 1% and segment adjusted EBITDA decreased 12%, versus Q2 2024. In Q2 2025, Biller segment revenue grew 16% and segment adjusted EBITDA grew 6%, versus Q2 2024. First half 2025 revenue was $796 million, up 15% from first half 2024. Recurring revenue in first half 2025 of $607 million was up 11% from first half 2024 and represented 76% of total revenue. First half 2025 net income of $71 million, which includes a $22 million after-tax gain on the sale of ACI's minority interest in India-based Mindgate, compares to net income of $23 million in first half 2024. Adjusted EBITDA in first half 2025 was $175 million, up 24% from first half 2024. Cash flow from operating activities in first half 2025 was $128 million, versus $178 million in first half 2024, largely due to the timing of receivables. In first half 2025, Payment Software segment revenue grew 18% and adjusted EBITDA grew 29%, versus the first half 2024. In first half 2025, Biller segment revenue grew 13% and adjusted EBITDA grew 4%, versus the first half 2024. ACI ended Q2 2025 with $190 million in cash on hand and a debt balance of $904 million, representing a net debt leverage ratio of 1.4x adjusted EBITDA. In the quarter, the Company also retired its $400 million senior unsecured notes maturing in August 2026 with an incremental term loan under the credit facility that matures in February 2029. During Q2 2025, the Company repurchased approximately 2.4 million shares for $119 million in capital, representing 2.4% of outstanding shares. First half 2025 repurchases totaled approximately 2.7 million shares for $134 million in capital. At the end of Q2 2025, the Company had approximately $223 million remaining on the share repurchase authorization. RAISING FULL YEAR 2025 OUTLOOK AND NEW THIRD QUARTER OUTLOOK ACI is raising guidance for the full year 2025. ACI now expects that total revenue for the full year of 2025 will be in the range of $1.710 billion to $1.740 billion, ahead of the previously issued guidance of $1.690 billion to $1.720 billion, and ahead of the guidance issued in February 2025 of $1.685 billion to $1.715 billion. ACI currently expects adjusted EBITDA for the full year 2025 will be in the range of $490 million to $505 million, ahead of the previously issued guidance of $480 million to $495 million. The company expects that total revenue for Q3 2025 will be in the range of $460 million to $470 million, and adjusted EBITDA for Q3 2025 will be in the range of $155 million to $165 million. CONFERENCE CALL TO DISCUSS FINANCIAL RESULTS Today, management will host a conference call at 8:30 a.m. ET to discuss these results. Interested persons may access a real-time teleconference webcast at To join the live audio call, please dial +1 (800) 715-9871, provide your name, the conference name of ACI Worldwide, Inc. and conference ID 88945; alternatively, to reduce operator assisted delays joining the call, we invite you to register in advance by visiting This process will provide you with a unique passcode allowing you to join the call without operator assistance. About ACI Worldwide ACI Worldwide, an original innovator in global payments technology, delivers transformative software solutions that power intelligent payments orchestration in real time so banks, billers, and merchants can drive growth, while continuously modernizing their payment infrastructures, simply and securely. With nearly 50 years of trusted payments expertise, we combine our global footprint with a local presence to offer enhanced payment experiences to stay ahead of constantly changing payment challenges and opportunities. © Copyright ACI Worldwide, Inc. 2025. ACI, ACI Worldwide, ACI Payments, Inc., ACI Pay, Speedpay and all ACI product/solution names are trademarks or registered trademarks of ACI Worldwide, Inc., or one of its subsidiaries, in the United States, other countries or both. Other parties' trademarks referenced are the property of their respective owners. To supplement our financial results presented on a GAAP basis, we use the non-GAAP measures indicated in the tables, which exclude significant transaction-related expenses, as well as other significant non-cash expenses such as depreciation, amortization, and stock-based compensation, that we believe are helpful in understanding our past financial performance and our future results. The presentation of these non-GAAP financial measures should be considered in addition to our GAAP results and are not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Management generally compensates for limitations in the use of non-GAAP financial measures by relying on comparable GAAP financial measures and providing investors with a reconciliation of non-GAAP financial measures only in addition to and in conjunction with results presented in accordance with GAAP. We believe that these non-GAAP financial measures reflect an additional way to view aspects of our operations that, when viewed with our GAAP results, provide a more complete understanding of factors and trends affecting our business. Certain non-GAAP measures include: Adjusted EBITDA: net income (loss) plus income tax expense (benefit), net interest income (expense), net other income (expense), depreciation, amortization and stock-based compensation, as well as significant transaction-related expenses. Adjusted EBITDA should be considered in addition to, rather than as a substitute for, net income (loss). Net adjusted EBITDA margin: Adjusted EBITDA divided by revenue net of pass-through interchange revenue. Net adjusted EBITDA margin should be considered in addition to, rather than as a substitute for, net income (loss). Diluted EPS adjusted for non-cash and significant transaction related items: diluted EPS plus tax effected significant transaction related items, amortization of acquired intangibles and software, and non-cash stock-based compensation. Diluted EPS adjusted for non-cash and significant transaction related items should be considered in addition to, rather than as a substitute for, diluted EPS. Recurring revenue: revenue from software as a service and platform as a service fees and maintenance fees. Recurring revenue should be considered in addition to, rather than as a substitute for, total revenue. ARR: New annual recurring revenue expected to be generated from new accounts, new applications, and add-on sales bookings contracts signed in the period. FORWARD-LOOKING STATEMENTS This press release contains forward-looking statements based on current expectations that involve a number of risks and uncertainties. Generally, forward-looking statements do not relate strictly to historical or current facts and may include words or phrases such as 'believes,' 'will,' 'expects,' 'anticipates,' 'intends,' and words and phrases of similar impact. The forward-looking statements are made pursuant to safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements in this press release include but are not limited to: (i) our move towards a more scalable and less seasonally-weighted financial model, (ii) looking ahead, we remain focused on increasing shareholder value through sales execution, enhancing the growth orientation across ACI, and the continued development and rollout of Connetic, our next generation payments hub platform, (iii) given the robust performance across the business, we are raising our full-year outlook for both revenue and adjusted EBITDA for 2025, and (iv) Q3 2025 and full-year 2025 revenue and adjusted EBITDA financial guidance. All of the foregoing forward-looking statements are expressly qualified by the risk factors discussed in our filings with the Securities and Exchange Commission. Such factors include, but are not limited to, increased competition, business interruptions, cybersecurity incidents or failure of our information technology and communication systems, security breaches, our ability to attract and retain senior management personnel and skilled technical employees, future acquisitions, strategic partnerships and investments, divestitures and other restructuring activities, implementation and success of our strategy, impact if we convert some or all on-premise licenses from fixed-term to subscription model, anti-takeover provisions, exposure to credit or operating risks arising from certain payment funding methods, loss caused by theft or fraud, customer reluctance to switch to a new vendor, our ability to adequately defend our intellectual property, litigation, consent orders and other compliance agreements, our offshore software development activities, risks from operating internationally, including fluctuations in currency exchange rates, events in eastern Europe and the Middle East, adverse changes in the global economy, compliance of our products with applicable legislation, governmental regulations and industry standards, the complexity of our products and services and the risk that they may contain hidden defects, legal and business risks from artificial intelligence technology incorporated into our products, risks to our business from the use of artificial intelligence by our workforce, complex regulations applicable to our payments business, our compliance with privacy and cybersecurity regulations, compliance with requirements of the payment card networks and Nacha, exposure to unknown tax liabilities, changes in tax laws and regulations, consolidations and failures in the financial services industry, volatility in our stock price, demand for our products, failure to obtain renewals of customer contracts or to obtain such renewals on favorable terms, delay or cancellation of customer projects or inaccurate project completion estimates, changes in card association and debit network fees or products, impairment of our goodwill or intangible assets, the accuracy of management's backlog estimates, the cyclical nature of our revenue and earnings and the accuracy of forecasts due to the concentration of revenue-generating activity during the final weeks of each quarter, restrictions and other financial covenants in our debt agreements, our existing levels of debt, incurring additional debt, events outside of our control including natural disasters, wars, and outbreaks of disease, and revenues or revenue mix below expectations. For a detailed discussion of these risk factors, parties that are relying on the forward-looking statements should review our filings with the Securities and Exchange Commission, including our most recently filed Annual Report on Form 10-K and our Quarterly Reports on Form 10-Q. ACI WORLDWIDE, INC. AND SUBSIDIARIES (unaudited and in thousands, except per share amounts) 2025 2024 2025 2024 Software as a service and platform as a service $ 271,258 $ 235,399 $ 508,341 $ 451,131 License 56,711 65,582 141,204 95,555 Maintenance 50,421 48,733 99,063 96,487 Services 22,868 23,765 47,215 46,325 Total revenues 401,258 373,479 795,823 689,498 Operating expenses Cost of revenue (1) 234,800 203,238 448,178 394,345 Research and development 41,107 35,410 80,015 70,403 Selling and marketing 28,741 28,551 60,927 55,301 General and administrative 37,651 24,993 65,243 50,993 Depreciation and amortization 24,101 27,586 48,086 55,195 Total operating expenses 366,400 319,778 702,449 626,237 Operating income 34,858 53,701 93,374 63,261 Other income (expense) Interest expense (14,527 ) (18,471 ) (29,210 ) (37,481 ) Interest income 3,934 3,953 7,998 7,962 Other, net (6,393 ) 1,156 17,347 (869 ) Total other income (expense) (16,986 ) (13,362 ) (3,865 ) (30,388 ) Income before income taxes 17,872 40,339 89,509 32,873 Income tax expense 5,670 9,452 18,437 9,737 Net income $ 12,202 $ 30,887 $ 71,072 $ 23,136 Income per common share Basic $ 0.12 $ 0.29 $ 0.68 $ 0.22 Diluted $ 0.12 $ 0.29 $ 0.67 $ 0.22 Weighted average common shares outstanding Basic 104,376 105,395 104,860 106,097 (1) The cost of revenue excludes charges for depreciation and amortization. Expand ACI WORLDWIDE, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited and in thousands) Three Months Ended June 30, Six Months Ended June 30, Cash flows from operating activities: Net income $ 12,202 $ 30,887 $ 71,072 $ 23,136 Adjustments to reconcile net income to net cash flows from operating activities: Depreciation 3,189 3,564 6,345 7,195 Amortization 20,912 24,022 41,741 48,000 Amortization of operating lease right-of-use assets 2,407 2,431 4,842 4,999 Amortization of deferred debt issuance costs 620 662 1,270 1,598 Deferred income taxes (1,745 ) 510 (4,208 ) 1,516 Stock-based compensation expense 16,411 10,720 28,038 18,819 Gain on sale of equity investment — — (25,927 ) — Other 1,591 (756 ) 873 (2,067 ) Changes in operating assets and liabilities: Receivables 7,051 (27,671 ) 48,691 99,598 Accounts payable 4,932 5,297 12,411 4,849 Accrued employee compensation 8,980 6,569 (16,202 ) (19,884 ) Deferred revenue (3,193 ) (5,590 ) (7,841 ) 8,317 Other current and noncurrent assets and liabilities (23,560 ) 4,372 (33,087 ) (17,818 ) Net cash flows from operating activities 49,797 55,017 128,018 178,258 Cash flows from investing activities: Purchases of property and equipment (2,156 ) (1,746 ) (4,326 ) (4,954 ) Purchases of software and distribution rights (5,383 ) (4,442 ) (12,142 ) (19,024 ) Proceeds from sale of equity investment — — 46,021 — Net cash flows from investing activities (7,539 ) (6,188 ) 29,553 (23,978 ) Cash flows from financing activities: Proceeds from issuance of common stock 819 704 1,632 1,397 Proceeds from exercises of stock options 214 277 796 752 Repurchase of stock-based compensation awards for tax withholdings (13,156 ) (3,037 ) (20,226 ) (6,339 ) Repurchases of common stock (119,362 ) (57,159 ) (133,770 ) (119,674 ) Redemption of 2026 Notes (400,000 ) — (400,000 ) — Proceeds from revolving credit facility 290,000 — 290,000 164,000 Repayment of revolving credit facility (30,000 ) — (100,000 ) (152,000 ) Proceeds from term portion of credit agreement 200,000 — 200,000 500,000 Repayment of term portion of credit agreement (9,375 ) (9,375 ) (18,750 ) (538,448 ) Payments on or proceeds from other debt, net (6,447 ) (5,975 ) (10,664 ) (8,669 ) Payments for debt issuance costs (134 ) — (134 ) (5,141 ) Net increase (decrease) in settlement assets and liabilities (26,751 ) 12,782 61,573 (6,151 ) Net cash flows from financing activities (114,192 ) (61,783 ) (129,543 ) (170,273 ) Effect of exchange rate fluctuations on cash 4,118 (1,024 ) 5,909 1,290 Net increase (decrease) in cash and cash equivalents (67,816 ) (13,978 ) 33,937 (14,703 ) Cash and cash equivalents, including settlement deposits, beginning of period 366,771 238,096 265,018 238,821 Cash and cash equivalents, including settlement deposits, end of period $ 298,955 $ 224,118 $ 298,955 $ 224,118 Reconciliation of cash and cash equivalents to the Consolidated Balance Sheets Cash and cash equivalents $ 189,697 $ 156,983 $ 189,697 $ 156,983 Settlement deposits 109,258 67,135 109,258 67,135 Total cash and cash equivalents $ 298,955 $ 224,118 $ 298,955 $ 224,118 Expand Three Months Ended June 30, Six Months Ended June 30, Adjusted EBITDA (millions) 2025 2024 2025 2024 Net income $ 12.2 $ 30.9 $ 71.1 $ 23.1 Plus: Income tax expense 5.7 9.4 18.4 9.7 Net interest expense 10.6 14.5 21.2 29.5 Net other (income) expense 6.4 (1.1 ) (17.3 ) 0.9 Depreciation expense 3.2 3.6 6.4 7.2 Amortization expense 20.9 24.0 41.7 48.0 Non-cash stock-based compensation expense 16.4 10.7 28.0 18.8 Adjusted EBITDA before significant transaction-related expenses $ 75.4 $ 92.0 $ 169.5 $ 137.2 Significant transaction-related expenses: Cost reduction strategies 5.1 0.4 5.1 3.0 Other 0.4 0.4 0.4 0.7 Adjusted EBITDA $ 80.9 $ 92.8 $ 175.0 $ 140.9 Revenue, net of interchange: Revenue $ 401.3 $ 373.5 $ 795.8 $ 689.5 Interchange 151.1 124.2 281.9 236.6 Revenue, net of interchange $ 250.2 $ 249.3 $ 513.9 $ 452.9 Net Adjusted EBITDA Margin 32 % 37 % 34 % 31 % Expand Three Months Ended June 30, Six Months Ended June 30, Segment Information (millions) 2025 2024 2025 2024 Revenue Payment Software $ 179.3 $ 181.7 $ 380.1 $ 322.8 Biller 221.9 191.8 415.7 366.7 Total $ 401.3 $ 373.5 $ 795.8 $ 689.5 Recurring Revenue Payment Software $ 99.8 $ 92.3 $ 191.6 $ 180.9 Biller 221.9 191.8 415.8 366.7 Total $ 321.7 $ 284.1 $ 607.4 $ 547.6 Segment Adjusted EBITDA Payment Software $ 83.3 $ 94.6 $ 189.8 $ 146.9 Biller 39.8 37.4 70.7 68.2 Note: Amounts may not recalculate due to rounding. Expand Six Months Ended June 30, 2025 2024 EPS Impact of Non-cash and Significant Transaction-related Items (millions) EPS Impact $ in Millions (Net of Tax) EPS Impact $ in Millions (Net of Tax) GAAP net income $ 0.67 $ 71.1 $ 0.22 $ 23.1 Adjusted for: Gain on sale of equity investment (0.20 ) (21.7 ) — — Significant transaction-related expenses 0.04 4.1 0.03 2.9 Amortization of acquisition-related intangibles 0.08 8.3 0.12 12.7 Amortization of acquisition-related software 0.06 6.4 0.06 6.7 Non-cash stock-based compensation 0.21 22.2 0.13 14.3 Total adjustments $ 0.19 $ 19.3 $ 0.34 $ 36.6 Diluted EPS adjusted for non-cash and significant transaction-related items $ 0.86 $ 90.4 $ 0.56 $ 59.7 Expand Three Months Ended June 30, Six Months Ended June 30, Recurring Revenue (millions) 2025 2024 2025 2024 SaaS and PaaS fees $ 271.3 $ 235.4 $ 508.3 $ 451.1 Maintenance fees 50.4 48.7 99.1 96.5 Recurring Revenue $ 321.7 $ 284.1 $ 607.4 $ 547.6 Expand New Bookings (millions) Three Months Ended June 30, TTM Ended June 30, 2025 2024 2025 2024 Annual recurring revenue (ARR) bookings $ 24.3 $ 13.1 $ 79.5 $ 68.8 License and services bookings 58.1 80.7 290.2 268.5 Note: Amounts may not recalculate due to rounding. 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