0001794669-25-000027
SEC filingRevenue grew 17% on 25% volume increase, but net income attributable to Shift4 fell 13% due to higher interest and taxes.
For the three months ended June 30, 2025, Shift4 Payments reported gross revenue of $966.2 million, up 17% from $827.0 million in the prior year period. Payments-based revenue increased 15% to $868.5 million, driven by a 25% increase in volume to $50.1 billion, partially offset by lower unit pricing from larger merchants. Subscription and other revenues grew 37% to $97.7 million, primarily due to recent acquisitions and higher SkyTab SaaS revenue.
Cost of sales: Network fees rose 9% to $552.8 million, in line with payments revenue growth. Gross revenue less network fees (a key non-GAAP metric) increased 29% to $413.4 million, indicating expanding margins from mix shift to higher-value subscription revenue and scale. Other costs of sales increased $32.1 million to $120.9 million, driven by acquisitions and residual commissions.
Operating expenses: General and administrative expenses rose 18% to $130.4 million, reflecting headcount growth and acquisitions. Depreciation and amortization increased $10.9 million to $57.6 million, mainly from acquisition-related intangible amortization and equipment under lease for SkyTab. Professional expenses grew 31% to $15.2 million due to acquisition costs (notably Global Blue). Advertising and marketing doubled to $7.1 million on brand awareness spend.
Below the line: Interest expense surged to $39.4 million from $8.1 million, reflecting the issuance of $1.65 billion of 2032 Senior Notes and $798.5 million of 2033 Euro Notes. Interest income increased to $19.2 million on higher cash balances. Income tax expense was $14.6 million (26% effective rate) versus a $1.8 million benefit in the prior year, which included a tax benefit from non-redeemable noncontrolling interest allocation.
Consolidated net income was $41.1 million versus $54.5 million, but net income attributable to Shift4 Payments, Inc. was $34.0 million versus $39.2 million, a decrease of $5.2 million due to higher interest and tax expense.
While Shift4 does not report formal segments, the revenue mix reveals two key dynamics: (1) Payments-based revenue grew 15%, slower than volume (+25%), indicating continued mix shift toward larger merchants with lower take rates; (2) Subscription and other revenues grew 37%, outpacing payments, suggesting successful upselling of SkyTab POS and other value-added services. The combination drove a 29% increase in gross revenue less network fees, a metric management uses to track value creation. Operating leverage is evident as Adjusted EBITDA grew 26% to $205.1 million, with margin expanding to 21.2% from 19.6%.
Management highlighted several forward-looking elements: After the July 2025 financing (including a $1.0 billion term loan and $100 million revolver increase), annualized interest expense is projected to be approximately $243 million, including $12 million of non-cash deferred financing fee amortization. The pending acquisition of Smartpay Holdings (NZ$296.4 million) is expected to close in Q4 2025, deepening presence in Australia/New Zealand. The Global Blue acquisition closed in July 2025 for ~$2.7 billion, and the company intends to delist Global Blue shares and terminate SEC reporting. Cash and cash equivalents stood at $3.03 billion as of June 30, 2025, though a significant portion was used for the Global Blue acquisition. The stock repurchase program had $206 million remaining as of June 30, 2025. No explicit revenue or earnings guidance was provided, but the strong volume and subscription trends suggest continued momentum.
Cash and cash equivalents totaled $3,029.3 million as of June 30, 2025, up from $1,211.9 million at year-end 2024, primarily due to debt and equity financings for the Global Blue acquisition. Total debt increased by $898.5 million to $3,731.8 million (carrying value), reflecting $1,348.5 million in new issuances (including $550 million of 6.750% Senior Notes due 2032 and €680 million of 5.500% Senior Notes due 2033) partially offset by $450.0 million repayment of the 4.625% Senior Notes due 2026. The company also has $688.6 million in current portion of debt (2025 Convertible Notes maturing December 2025). Inventory was $7.1 million, and deferred revenue (contract liabilities) was $15.6 million.
No material purchase commitments or contractual obligations beyond debt and lease liabilities are disclosed in the notes. The company's commitments primarily arise from debt service and contingent consideration related to acquisitions ($26.8 million as of June 30, 2025). There are no supply or capacity purchase commitments reported.
Stock repurchases under the May 2024 program totaled $148.2 million for 1,834,895 shares (average $80.72 per share) during the six months ended June 30, 2025. As of June 30, 2025, $206.0 million remains available under the authorization. The company issued $1.0 billion of 6.00% Series A Mandatory Convertible Preferred Stock in May 2025, accruing $9.5 million in dividends. No common stock dividends were declared. Debt management included the issuance of $550 million of 6.750% Senior Notes due 2032 and €680 million of 5.500% Senior Notes due 2033, with proceeds used to fund the Global Blue acquisition and repay $450 million of 2026 Notes. The company recognized a $3.1 million loss on debt extinguishment from the repayment.
Shift4 Payments operates as a single reportable segment. The chief operating decision maker (CEO) evaluates performance based on consolidated net income. Disaggregated revenue for Q2 2025 includes payments-based revenue of $868.5 million (89.9% of total) and subscription and other revenues of $97.7 million (10.1%). Geographic mix is not disclosed, though the company primarily operates in the U.S. The segment note provides a detailed breakdown of significant expenses, including network fees, other costs of sales, and employee expenses.
Net income of $60.6M was significantly lower than operating cash flow of $238.5M, indicating strong cash generation due to non-cash charges. Depreciation and amortization of $173.6M and equity-based compensation of $41.2M were the main add-backs, offset by a deferred tax benefit of $20.5M. Working capital changes consumed cash: accounts receivable increased $24.0M, while accounts payable provided $17.0M. Capitalized customer acquisition costs ($22.2M) and other items were also uses. Capex intensity (capex/CFO) was 39% ($92.8M / $238.5M), reflecting continued investment in software and equipment. The large financing cash inflow of $1,626.1M was driven by proceeds from debt ($1,313.2M) and preferred stock ($1,000.0M), partially offset by debt repayment ($450.0M) and share repurchases ($148.2M). The effect of exchange rate changes added $82.1M to cash, leading to a large net increase in cash. No dividends were paid.