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    CPAY
    Earnings call· Mar 2026(Q1 FY26)

    CORPAY Q1 FY26 earnings call CPAY

    May 7, 2026 Source

    Executive summary

    Corpay Q1 FY26 — Blowout Quarter with Strong Organic Growth and Raised Full-Year Guidance

    Corpay delivered an outstanding Q1 FY26, marked by strong organic revenue growth and significant beats on both top and bottom lines, leading to a confident raise in full-year guidance. The company is actively executing its portfolio rotation towards Corporate Payments, with strategic divestitures and acquisitions underway, aiming for a simpler, high-growth model focused on three global business categories.

    Highlights

    5

    • Reported revenue of $1.26 billion, up 25% year-over-year.

    • Cash EPS of $5.80, up 29% year-over-year.

    • Overall organic revenue growth of 11% for the fourth consecutive quarter.

    • Corporate Payments organic revenue grew 16% (18% excluding flow compression), reaching 40% of total revenues.

    • New sales/bookings up 24% and overall retention finished at 93.5%.

    Concerns

    3

    • Divestiture of PayByPhone resulted in a $75 million reduction to rest of year revenue guidance.

    • Adjusted EBITDA margin slightly down year-over-year due to acquisitions.

    • Higher interest expense expected for the rest of the year, though offset by share buybacks.

    Guidance & targets

    10
    CategoryTargetConfidence
    Full-year 2026 Revenue
    $5.290 billion at the midpoint
    high materiality
    High
    Full-year 2026 Organic Revenue Growth
    10%
    high materiality
    High
    Full-year 2026 Cash EPS
    $26.70 at the midpoint
    high materiality
    High
    Q2 Revenue
    $1.295 billion at the midpoint
    medium materiality
    High
    Q2 Organic Revenue Growth
    9% to 11%
    medium materiality
    High
    Q2 Adjusted EPS
    $6.55 at the midpoint
    medium materiality
    High
    Midterm Cash EPS
    double cash EPS to $50 a share
    high materiality
    High
    Midterm Cash Generation
    about $15 billion
    high materiality
    High
    Midterm Organic Revenue Growth
    10%
    high materiality
    High
    Midterm Earnings Growth
    15% plus
    high materiality
    High

    Segment performance

    3
    SegmentRevenueYoYQoQMargin
    Corporate Payments
    Exceeded expectations driven by strong cross-border and payables performance. Currency volatility was a helpful backdrop for sales. Constituted 40% of overall revenues in Q1.
    Organic growth excluding flow compression: 18%Spend volumes: $82 billion (up 43% organically)Alpha organic revenue growth: 17% (ex-flow compression)Alpha client migration to tech platform: 15%Avid EBITDA growth: 50% over Q1 2025Payables sales performance: strong
    		—16%——
    Vehicle Payments
    Solid results across all three geographies (US, Europe, Brazil). Higher fuel prices benefited the segment. Divestiture of PayByPhone completed.
    US same-store sales: +1%Brazil business forecast: high teens rest of yearEurope business: steady around 10%
    		—10%——
    Lodging
    Better than expected performance, raising confidence for growth acceleration in the second half of the year. Base has stabilized after prior IT issues.
    Same-store sales: +6%
    		—flat7% vs Q4 2025—

    Operational metrics

    30
    Q1 Revenue Beat
    $50 millionvs guidance
    Q1 FY26

    Approximately 2/3 of the beat was due to better performance, not macro related.

    Rest of Year Revenue Raise
    $50 million
    Rest of FY26

    Result of higher fuel price expectations and continued better fundamental performance.

    Revenue Reduction from Divestiture
    $75 million
    Rest of FY26

    Reflects the divestiture of PayByPhone on March 31.

    Q1 Cash EPS Beat
    $0.35vs guidance
    Q1 FY26

    Flowed through to full-year guidance.

    Rest of Year Cash EPS Raise
    $0.35
    Rest of FY26

    Coming from the expected $50 million in rest of year higher revenue.

    Lower Share Count Impact
    offset
    FY26

    From year-to-date share buybacks, offsetting expected higher interest expense.

    Adjusted EBITDA Margin
    54.6%slightly down over prior year
    Q1 FY26

    Primarily due to acquisitions.

    Adjusted Effective Tax Rate
    26.8%year-over-year increase
    Q1 FY26

    Due to the favorable impact of employee stock options on the tax rate last year.

    Leverage Ratio
    2.7x
    Q1 FY26

    Ended the quarter in excellent shape.

    Available Borrowing Capacity on Revolver
    $1.4 billion
    Q1 FY26

    As of quarter end.

    Share Repurchases Executed
    $786 million
    Q1 FY26

    Pre-purchased shares in advance of receiving PayByPhone proceeds.

    Share Repurchase Authorization Remaining
    $1.8 billion
    Q1 FY26

    Board approved an additional $1 billion in the most recent meeting.

    Credit Facility Upsize
    over $1 billionversus existing levels
    Q2 FY26

    Proceeds to pay down portion of Term Loan B expiring April 2028. Not reflected in current guidance.

    Overall Retention
    93.5%
    Q1 FY26

    This metric now includes the cross-border business.

    New Sales/Bookings Growth
    24%
    Q1 FY26

    Happy with this performance.

    Same-Store Sales
    flat
    Q1 FY26

    Company-wide.

    Corporate Payments Revenue Mix
    40%
    Q1 FY26

    Of overall revenues.

    Corporate Payments & Vehicle Payments Revenue Mix
    85%
    Q1 FY26

    Of Q1 2026 revenue.

    Corporate Payments & Vehicle Payments Combined Organic Growth Rate
    12%
    Q1 FY26

    Combined growth for the two largest segments.

    Operating Costs Growth
    10%
    Q1 FY26

    Primarily due to higher transaction volumes and higher bad debt.

    Payables Business USA Origin
    100%
    Historical

    Up until about 6 months ago, now expanding to Europe.

    Payables Spend Management Europe Revenue Run Rate
    $15 million
    Current

    Current run rate for the newly launched spend management business in Europe.

    Cross-Border Business Sales Growth
    40%
    Q1 FY26

    Base business sales growth.

    Cross-Border Business Revenue
    $1.5 billion
    2026

    Ballpark estimate for the year.

    Mastercard Partnership Sales Contracts
    3 or 4
    Q1 FY26

    Sales contracts made through the partnership.

    Mastercard Partnership Pipeline Accounts
    50
    Q1 FY26

    Accounts in the pipeline from the partnership.

    Middle Market Company Revenue Range
    $300 million - $400 million
    Current

    Target revenue range for companies in the middle market sales strategy.

    Cross-Border Business Origination
    75%
    Current

    Percentage of business originated in other geographies (Canada, UK, Continental Europe, Singapore, Australia, etc.).

    Cross-Border Market Share
    1%
    Current

    Of a $160 trillion market, highlighting significant opportunity.

    Revenue Climb Q1 to Q4
    $100 million
    FY26

    Absolute revenue increase built into the guide from Q1 to Q4.

    Industry KPIs

    4
    MetricValueDetails
    Capital returns$786 millionUSD
    Cross border volume—
    Payments volume gdv$82 billionUSD
    Net revenue yield take rate62 basis pointsbps

    Product announcements

    3
    ProductTypeDetails
    Blockchain Rails for Global Settlement Networklaunch
    Multicurrency Account Banking Businessexpansion
    Spend Management Businesslaunch

    Deals & partnerships

    4
    PayByPhoneSale of non-core asset.

    Divestiture completed on March 31.

    JPMorganAgreement to integrate blockchain rails for global settlement network.

    Partnership to speed the addition of blockchain rails to Corpay's global settlement network.

    BVNKAgreement to integrate blockchain rails for global settlement network.

    Partnership to speed the addition of blockchain rails to Corpay's global settlement network.

    MastercardStrategic partnership for cross-border business.

    Mastercard introduces Corpay to its client base, leveraging Corpay's expertise, particularly for multicurrency bank accounts.

    Risks & headwinds

    5
    Float revenue compressionQ1 FY26

    200 basis point drag

    Mitigation: Offset by strong performance in cross-border and payables.

    Higher interest expenserest of year

    offset by lower share count

    Mitigation: Expected to be offset by lower share count from year-to-date share buybacks.

    IT issues in Lodging segmentpast

    bled us over 6 to 12 months

    Mitigation: Base has stabilized, Q1 same-store sales +6%, expected mid-to-high single-digit growth in H2.

    Micro market challenges for Vehicle Paymentspast

    credit losses, client losses, short account lives

    Mitigation: Shifted focus to middle market for USA sales, which offers more stable and larger accounts.

    Slower sales cycle for Mastercard partnershipongoing

    3-4 sales contracts, 50 accounts in pipeline

    Mitigation: Formula is working, with sales contracts and pipeline accounts building; strong interest in multicurrency bank accounts.

    What to watch in Q2 FY26

    5

    Divestiture of meaningful non-core asset

    Q2 FY26
    CurrentIn late innings
    TargetSigned or not signed

    Why it matters

    This will further advance the portfolio rotation towards Corporate Payments and free up capital for strategic acquisitions or buybacks.

    I will say, one, that we're super late innings on a pretty meaningful transaction of divestiture. And so that will either happen or not happen, maybe get signed or not in this quarter.

    Q&A highlights

    6

    Inquiring about the sustainability of strong underlying trends and macro help, and if there's more upside to the full-year guidance given the Q1 performance.

    Management confirmed strong Q1 performance and noted that while Q1 had an easier comp, the rest of the year has higher comps. The guidance raise reflects continued business performance and macro favorability, with a built-in revenue climb from Q1 to Q4.

    “Remember, in our business, we take the absolute revenue up about $100 million from Q1 to Q4. So there's a climb already built into the guide to start.”

    asked by Sanjay Sakhrani · answered by Ronald F. Clarke

    2 min read5 chapters

    Detailed Narrative

    01

    Q1 Performance Highlights

    Corpay reported a "blowout quarter" with Q1 revenue of $1.26 billion (up 25% year-over-year) and cash EPS of $5.80 (up 29% year-over-year). Approximately two-thirds of the $50 million Q1 revenue beat was attributed to better performance across the board rather than macro factors. Organic revenue growth was 11% for the fourth consecutive quarter, driven by Corporate Payments (16% organic, 18% excluding flow compression) and Vehicle Payments (10% organic).

    02

    Portfolio Rotation and Strategic Priorities

    The company is actively rotating its portfolio towards Corporate Payments, which now constitutes 40% of overall revenues. This involves divesting non-core, TAM-constrained businesses (e.g., PayByPhone divestiture, reducing revenue guidance by $75 million) and acquiring Corporate Payment assets. Key priorities include increasing USA sales in the middle market (targeting companies with $300-$400 million in revenue), widening monetization in payables, developing multicurrency accounts, integrating Alpha, and incorporating AI for product enhancement and expense savings.

    03

    Cross-Border Business Momentum

    The core cross-border business is performing exceptionally well, with Alpha organic revenue growing 17% in Q1 (excluding flow compression) and 15% of Alpha clients already migrated to Corpay's tech platform. New agreements with JPMorgan and BVNK aim to integrate real-time blockchain rails into the global settlement network, enhancing global commerce for middle-market companies. The base business sales were up 40% in Q1, contributing to an estimated $1.5 billion in revenue for 2026.

    04

    Midterm Vision and Financial Objectives

    Corpay's midterm strategy focuses on building three global businesses: employee payments, B2B payments, and cross-border payments, all centered on helping businesses manage expenses. Objectives include sustaining 10% organic revenue growth, achieving 15%+ earnings growth, and doubling cash EPS to $50 per share during the forecast period, supported by an expected $15 billion in cash generation. The company aims to build a simpler, more attractive, and consistent high-growth entity.

    05

    Lodging Segment Recovery

    The Lodging segment showed meaningful sequential improvement, landing flat for the quarter, a significant turnaround from previous declines. Same-store sales for Lodging were up 6% in Q1, indicating a strong stabilization and expected mid-to-high single-digit growth in the second half of the year due to pipeline build-up. This recovery is a positive shift from the negative 18% same-store sales seen eight quarters prior.

    AI-generated summary of the company’s earnings call. Not investment advice.