Earnings call transcript: Shift4 Payments Q2 2025 misses EPS forecast

Shift4 Payments Inc. reported its Q2 2025 earnings, revealing an earnings per share (EPS) of $1.10, which fell short of the forecasted $1.22. Despite this miss, the company achieved a significant revenue surprise, reporting $966.2 million against a forecast of $409.79 million. In pre-market trading, Shift4’s stock fell by 8.35% to $93.67, reflecting investor concern over the EPS miss. According to InvestingPro analysis, the stock appears undervalued based on its Fair Value calculation, with analysts maintaining a strong buy consensus and a high target of $150.

Want deeper insights? InvestingPro offers comprehensive analysis with 12 additional ProTips and a detailed Pro Research Report for Shift4 Payments, helping investors make informed decisions. The stock’s decline comes amid a broader market context, with Shift4’s price moving away from its 52-week high of $127.50.

Key Takeaways

• EPS of $1.10 missed the forecast of $1.22.
• Revenue of $966.2 million significantly exceeded expectations.
• Pre-market stock price dropped by 8.35% to $93.67.
• Payment volumes grew by 25% year-over-year.
• International expansion and product innovation remain focal points.

Company Performance

Shift4 Payments demonstrated robust growth in Q2 2025, with payment volumes reaching $50 billion, marking a 25% increase year-over-year. The company also reported $413 million in gross revenue less network fees, a 29% rise from the previous year. InvestingPro data shows impressive revenue growth of 27.39% over the last twelve months, with a strong financial health score of 2.98 (rated as "GOOD"). The company maintains a healthy current ratio of 1.36, indicating solid operational efficiency. This growth is fueled by strategic acquisitions and international expansion, positioning Shift4 as a leader in the hospitality and entertainment sectors.

Financial Highlights

• Revenue: $966.2 million, up significantly from the forecast.
• EPS: $1.10, down from the forecast of $1.22.
• Adjusted EBITDA: $255 million, a 26% year-over-year increase.
• Subscription & Other Revenue: $97.7 million, up 37% year-over-year.

Earnings vs. Forecast

Shift4’s Q2 2025 EPS of $1.10 was below the expected $1.22, representing a 9.84% miss. However, the company delivered a substantial revenue beat, with actual revenue of $966.2 million compared to the forecast of $409.79 million, a surprise of 135.78%. This divergence indicates strong top-line growth despite the EPS shortfall.

Market Reaction

Following the earnings release, Shift4’s stock price decreased by 8.35% in pre-market trading, settling at $93.67. This decline reflects investor concerns over the EPS miss, despite the impressive revenue performance. InvestingPro indicates the stock has shown significant volatility, with a beta of 1.81, yet has delivered a strong 66.83% return over the past year. The company trades at a P/E ratio of 34.79, which appears justified given its growth trajectory.

Get exclusive access to detailed valuation metrics, real-time alerts, and expert analysis with an InvestingPro subscription. The stock’s movement contrasts with its 52-week high of $127.50, indicating a cautious market sentiment.

Outlook & Guidance

Shift4 maintains a positive outlook for the remainder of 2025, forecasting gross revenue less network fees between $1.965 billion and $2.035 billion, with adjusted EBITDA expected to range from $965 million to $990 million. The company anticipates continued growth from its Global Blue acquisition, projecting $300 million in revenue contribution for the second half of the year.

Executive Commentary

CEO Taylor Lauber emphasized the company’s strategic expansion, stating, "We believe we are still very early in the convergence of payments and software." Lauber also highlighted the integration of Global Blue and SmartPay as pivotal moves, noting, "Global Blue gave us the conviction that that plus SmartPay was a hell of a good idea."

Risks and Challenges

• Currency fluctuations affecting international spending.
• Potential market saturation in key sectors.
• Macroeconomic pressures impacting consumer spending.
• Integration challenges with new acquisitions.
• Competitive pressures in the payments industry.

Q&A

During the earnings call, analysts focused on Shift4’s international expansion strategy and integration of Global Blue. Questions also addressed consumer spending trends and the company’s approach to stablecoin and agentic commerce, reflecting interest in Shift4’s future growth avenues.

Full transcript - Shift4 Payments Inc (FOUR) Q2 2025:

Conference Operator: Greetings. Welcome to Shift4’s Second Quarter twenty twenty five Earnings Conference Call. At this time, all participants are in a listen only mode. A question and answer session will follow the formal presentation. Please note this conference is being recorded.

I will now turn the conference over to Thomas McCroen, EVP, Investor Relations. Thank you. You may now begin.

Thomas McCroen, EVP, Investor Relations, Shift4: Thank you, operator, and good morning, everyone, and welcome to Shift4’s second quarter twenty twenty five earnings conference call. With me on the call today are Taylor Lauber, our CEO and Nancy Dissmann, our Chief Financial Officer. This call is being webcast on the Investor Relations section of our website, which can be found at investors.shift4.com. Today’s call is also being simulcast on X Spaces, formerly known as Twitter, which can be accessed through our corporate Twitter account, Shift4. Our quarterly shareholder letter, quarterly financial results and other materials related to our quarterly results have all been posted to our IR website.

Our call and earnings materials today include forward looking statements. These statements are not guarantees of future performance and our actual results could differ materially as a result of certain risks, uncertainties and many important factors. Additional information concerning those factors is available in our most recent reports on Forms 10 ks and 10 Q, which you can find on the SEC’s website and the Investor Relations section of our corporate website. For any non GAAP financial information discussed on this call, the related GAAP measures and reconciliations are available in today’s quarterly shareholder letter. With that, let me turn the call over to Taylor.

Taylor Lauber, CEO, Shift4: Good morning, everyone. Thanks for joining the call. While I will hit our strong Q2 financial performance in a minute, these past few months are illustrative of so much more than that. The Shipwort team has accomplished more since our last earnings call than we have an entire year’s prior. More importantly, they’ve done it well and without compromising the day to day.

I’m truly humbled to get to call myself Just to name a few of our accomplishments and wins this quarter, we successfully diversified our capital structure with a $3,300,000,000 capital raise in May, which provided both the funding for Global Blue and also retired near term debt maturities. We are beginning to hit our stride in several European markets where we can now sell a broad suite of products be that restaurants, hotels, sports and entertainment, unified commerce, etcetera. We streamlined our onboarding systems allowing us to board over 1,000 new merchants per month in Europe alone. And again, this is just the beginning. We signed a pending acquisition of SmartPay, which essentially lets us capitalize on our leading products in restaurants, hotels, sports and entertainment by adding an incredible distribution network.

Those who have followed previous acquisitions like Vectron know this playbook well. In Canada, we continue to expand our presence and win in the verticals we serve best. We are powering payments at the Canadian Tennis Open, which is currently underway in Toronto. Jared moved into the role of Executive Chairman and myself the CEO. This allows us to continue to execute on our mission with the benefit of our founder and largest shareholder remaining focused on movers.

Make no mistake, this is a loss for our country and for humanity more broadly, but a win for Shift4. The Global Blue acquisition closed in early July and we welcomed Antin International and Tencent as strategic shareholders. They each own a little less than 1% of our equity, but collaborate with our teams regularly on product capabilities in order to make payment complexity for our merchants and their consumers easier. All of this and much more was accomplished without taking our eye off the ball. Our financial results were in line with our expectations and marked by quarterly records across several of our KPIs.

Some financial highlights for the quarter include 25% year over year growth in payment volumes to $50,000,000,000 This is our first quarter generating over $50,000,000,000 in payment volumes. 29% year over year growth in gross revenue less network fees to $413,000,000 26% year over year growth in adjusted EBITDA to $2.00 $5,000,000 and 49.6% adjusted EBITDA margins. 37% year over year growth in subscription and other revenues to $97,700,000 also a Q2 record and blended spreads of 62.6 basis points versus 61.5 in 2024, ahead of our full year guidance. How is all this possible? Our algorithm is much simpler than I think many understand.

We believe we are still very early in the convergence of payments and software, especially when it comes to international markets. We seek out technologies that will make us highly differentiated to merchants and give us an edge in large industry verticals. When we have an idea, we build, buy or partner quickly with conviction and with an intense focus on capital efficiency. This playbook began well over twenty years ago, but has been refined constantly and today we are number one in hotels, number one in sports and entertainment and number two in restaurants. For emphasis, we recently won the corner collection of hotels, the Golden Gate Hotel and Casino, Blackcomb Springs, Camelback, Capital Vacations, Ponte Vedra Beach Resorts and many more.

We had a record quarter of SkyTab systems installed in restaurants supported in small part by the European success that I mentioned earlier. We are well on track to meeting our goal of 45,000 SkyTab systems installed globally in 2025. SkyTab continues to deliver for our customers in some of the most intense environments including a futuristic diner and EV charging destination that recently opened in LA. Our sports and entertainment business continues to put points on the board adding food and beverage payments to the Cleveland Cavaliers in addition to ticketing. University of Kentucky, University of Arizona, the Glastonbury Festival, the Detroit Lions and many more entertainment venues recently joined Shift4.

Perhaps most exciting of all, SkyTab venue is coming to Madison Square Garden, home of the New York Knicks and Rangers as well as Radio City Music Hall and the Beacon Theater, a whole suite of New York institutions. We also quietly invest in capabilities for marquee customers that we think will have relevance in the future and set us up better to win. BYD is an example of a new partner that is introducing our services to its dealerships in Latin America. Those of you at our Investor Day will recall us previewing some of these new and emerging capabilities back then. With the acquisition of Global Blue, we will accelerate our geographic expansion and dominance in these verticals.

We will also gain scarce market leading products in an entirely new vertical, which is luxury retail. I want to officially welcome the over 2,000 Global Blue colleagues located around the world to the Ship four team. I cannot be more excited about this acquisition and the long term implications company. Adding Global Blue’s technology capabilities, the employee talent and the strong reputation with global retailers will accelerate our global expansion plans. Combined, we will offer a truly differentiated right to win within the retail vertical.

It’s important to note that too often you’ve seen other companies first enter adjacent vertical only to later determine they lack a unique go to market offering. As we have hopefully demonstrated time and time again, that is not our approach. We first determine our unique differentiation before entering a new vertical, which helps us underwrite our success. Global Blue is very similar to our success in stadiums. I would argue not a single person on this call would have predicted our market position today in sports and entertainment four years ago when we announced the acquisition of Venue Next back in March 2021.

The acquisition of Global Blue is classic shift forward just on a larger scale. We believe it is our responsibility to shareholders to continue delivering long term value creation by executing on this algorithm even at a larger scale. Inclusive of the capital deployed to acquire Global Blue, we’ve invested about 5,400,000,000 of capital since our IPO back into the business across three major categories customer acquisition, product investment and acquisitions. This $5,400,000,000 of capital has generated an associated annual EBITDA contribution of $890,000,000 and free cash flow of $514,000,000 We are investing capital back into the business at returns below our current trading levels or at roughly 6.1 times EBITDA multiple and a 10% free cash flow yield, which compares to our current trading levels of about 15 times EBITDA and a 6% free cash flow Regarding the balance of the year, integrating Global Blue remains a key priority as well as continuing our international expansion and continuing to execute. Obviously, none of this would be possible without a stable of products that merchants see value in and so we continue to invest meaningfully in SkyTab, SkyTab Venue and our broader payment platform.

We now have over 1,200 integrations up from about three fifty just five years ago with European capabilities being a particular area of focus. Of note, I’ve already personally entertained productive conversations with a number of key Global Blue customers both at the executive level and in physical stores. The early feedback from these conversations has only served to reinforce my conviction that this combination has created something unique in the FinTech industry. Having witnessed our success in other verticals, it’s hard to temper my enthusiasm for this new journey we’re on. Since hosting our Analyst Day back in February, it’s also worth reminding everyone that we are now tracking towards the most likely medium term guidance scenario.

As you recall, we provided three guidance scenarios at our Analyst Day, sit on our hands, the combination of Global Blue and most likely with that most likely scenario calling for 30% plus gross revenue less network fee growth and 30% EBITDA growth, all with the ultimate goal of exiting at a run rate $1,000,000,000 in free cash flow. With the acquisition of Global Blue now behind us and the recent tuck in acquisition in Australia and New Zealand, we are clearly tracking to deliver on the most likely objectives established this past February. Before turning the call over to Nancy, I wanted to quickly provide an update on the May capital raise given the number of eight Ks we issued was likely very difficult to keep up with. In short, the roughly $3,300,000,000 of capital raised in May was intentionally diversified across a combination of fixed and floating rate instruments, including our first euro denominated debt offering to align with our growing European presence and included preferred equity in the form of a $1,000,000,000 mandatory convertible instrument. On the mandatory converts, we issued 10,000,000 shares of mandatory convertible notes at $100 a share.

In essence, will receive approximately 10,000,000 shares of Class A when the notes mature in May 2028. And because they settle in shares, these notes are not are treated as equity and not as debt. We also hold cash on hand for our December maturity and have already paid off our 2026 maturity, giving us lots of flexibility for the years ahead. We expect net leverage at year end to be approximately 3.5 times. Nancy will review some of the modeling related impacts to consider such as quarterly interest expense and what share count to use for the purposes of calculated non GAAP adjusted EPS in her remarks shortly.

With that, I’ll turn the call over to Nancy.

Nancy Dissmann, CFO, Shift4: Thank you, Taylor. We delivered another quarter of consistent and solid results in line with our expectations setting new second quarter records across several of our key performance indicators. Volume grew 25% year over year to $50,000,000,000 Gross revenue less network fees grew 29% to $413,000,000 and adjusted EBITDA grew 26% to $2.00 $5,000,000 Our Q2 adjusted EBITDA margins were 50%. Excluding the drag from recent acquisitions, adjusted EBITDA margins would have been 53%. We expect to benefit from higher levels of operating leverage as the year progresses and we add incremental payment volumes from cross selling and working through our existing backlog.

Since Q2 twenty twenty two, we have grown adjusted EBITDA over 3x and expanded margins over 1,300 basis points, all while also deploying capital on acquisitions that were highly dilutive to the margin profile of the business. Through continued execution on cross sell synergies and deleting the parts, we’ve maintained best in class margins of 50%. We will continue to follow the Shift4 playbook, delete legacy parts and continue to expand margins and repurpose resources towards future growth. Our Q2 blended net spreads were strong at 63 basis points and we now expect full year spreads to be stronger than the 60 basis points we previously communicated given in part to our international success. Spreads remain stable across our core business of restaurant, hospitality and specialty retail.

Subscription and other revenue was $98,000,000 in Q2, up 37% compared to the same period last year. The growth was once again driven by our success across SMB, SkyTab and further penetration of the sports and entertainment vertical as well as contribution from recently completed acquisitions. Ongoing deprecation of legacy revenue from recent acquisitions will continue to influence year over year growth rates for the remainder of the year. Q2 organic gross revenue less network fee growth was in line with our expectations and we are on track for 20% plus organic revenue growth for the full year. Our adjusted free cash flow in the quarter was $118,000,000 representing 57% adjusted free cash flow conversion.

Included in the $118,000,000 is $9,000,000 in prepaid interest we received in May from the recent issuance of 2,032 notes, which will be included in the August semi annual interest payment. This affects both Q2 and Q3 adjusted free cash flow, but nets to zero on a full year basis. We remain on track to deliver 50% plus free cash flow conversion for the full year. GAAP net income for the second quarter was $41,000,000 and GAAP diluted EPS was $0.32 per share. Non GAAP adjusted net income for the quarter was $109,000,000 or $1.1 per share on a fully diluted basis.

Of note, our non GAAP share count now contains an additional 10,000,000 shares related to the mandatory convertible preferred issued in the quarter, bringing our total share count for the quarter to 99,300,000.0 shares. We had our most active quarter of financing activity since the IPO. In May, we raised $3,300,000,000 of total capital to fund the acquisition of Global Blue and to repurchase the outstanding 4.625% senior notes due in November 2026. The $3,300,000,000 raise consisted of the following: $1,300,000,000 of senior notes, which was a combination of USD and euro denominated notes $1,000,000,000 of mandatory convertible preferred stock and $1,000,000,000 of floating rate Term Loan B, which closed on July 3 in conjunction with the Global Blue transaction. For adjusted free cash flow modeling purposes, you should now expect approximately $75,000,000 of cash interest payments on debt in Q1 and Q3 and $40,000,000 in Q2 and in Q4.

Additionally, we upsized the capacity of our revolving credit facility from $450,000,000 to $550,000,000 During the second quarter, we opportunistically repurchased $85,000,000 of common stock at an average of $74 per share. And as a reminder, the twenty twenty five converts principal will be redeemed in Q4 with $690,000,000 of cash on hand with any premium to be settled with common stock. We are well positioned to fuel our future growth. And as previously discussed at our Investor Day, we expect net leverage at year end to be less than 3.5 times. As indicated by our recent capital raise, which as Taylor mentioned was diversified across a combination of debt and equity instruments, we continue to prioritize maintaining low leverage to ensure financial stability and flexibility.

At the same time, we remain opportunistic in pursuing strategic M and A that aligns with our growth objectives and delivers long term value. Now turning to guidance. We are updating 2025 financial guidance to include the contributions from Global Blue and introducing Q3 guidance. I want to step through the highlights of the guidance bridge as it pertains to our outlook for the rest of the year. First, we continue to expect organic gross revenue less network fees for the full year to grow north of 20%.

We are modestly raising our gross revenue less network fee guidance by $5,000,000 to a range of $1,665,000,000 to $1,735,000,000 representing 23% to 28% growth before considering the impact of Global Blue. On a standalone basis, we expect Global Blue’s revenue in the back half of the year to be $334,000,000 with adjusted EBITDA of $137,000,000 When translating these results to GAAP and Shipwort’s presentation of gross revenue less network contribution for the remainder of the year will be $300,000,000 of gross revenue less network fees and $125,000,000 of adjusted EBITDA. As a reminder, the revenue synergies we have previously highlighted will have no impact in 2025. You can refer to page 18 of our shareholder letter for a complete bridge of Global Blue’s expected contribution to Shift four. The resulting full year consolidated guidance is a raise of gross revenue less network fees to a range of 1,965,000,000.000 and $2,035,000,000 representing 45% to 50% growth and a raise of adjusted EBITDA to a range of $965,000,000 and $990,000,000 representing 42% to 46% growth.

For third quarter, we expect gross revenue less network fees of approximately $590,000,000 and adjusted EBITDA of approximately $290,000,000 expect the contribution from Global Blue to be split about fifty-fifty between Q3 and Q4. And finally, for clarity, this guidance does not include the impact of our previously announced acquisition of SmartPay. Before I hand the call back to Taylor, I appreciate the opportunity to share a few brief remarks. It is with careful consideration that I made the difficult decision to retire from my role as CFO. It has been an extraordinary privilege to work alongside the Shift4 team during a remarkable period of growth and global expansion.

To ensure a seamless transition to Chris, I will continue to serve as a strategic advisor through the end of the year. I’m also looking forward to rejoining the Board of Directors where I will remain fully committed to supporting Shift4’s long term strategy, execution and value creation for our shareholders. With that, let me now turn the call back to Taylor.

Taylor Lauber, CEO, Shift4: Thank you, Nancy. It’s been amazing to work alongside of you. The team and I really appreciate your efforts these last few years and are excited to have you back the Board. Chris Cruz has joined us here on the call to have a chance to say hello, although many of you listening have already met him. Lastly, and I’m sorry to end on a somber note, but I simply couldn’t neglect to acknowledge the pain my former colleagues at Blackstone and everyone at 345 Park Avenue are dealing with.

The completely senseless nature of what happened is something I’m still coming to grips with. All I can say is that it should serve as a reminder to cherish time with your loved ones and work harder to make this world better. Thank you.

Conference Operator: Thank you. We’ll now be conducting a question and answer session. Our first question comes from the line of Timothy Chiodo with UBS. Please proceed with your questions.

Timothy Chiodo, Analyst, UBS: Great. Thank you for taking the question. I want to hit on two, if you don’t mind. The first one is around international and Australia. And the second one, if you don’t mind, I’ll follow-up.

It’s around the 200,000,000,000 to $220,000,000,000 in end to end volume guide. On the first one, so international, you’ve mentioned roughly 3,000 or more, 3,000 plus SkyTab installs internationally per quarter. And you made the acquisition of SmartPay to further enter the Australian market. That market has been of investor interest. It looks like Toast is also entering into Australia.

Maybe you just talk a little bit about the SmartPay acquisition and the Australia market and what is attractive about that, that has both you and entering it roughly at the same time? And then we’ll come back on the end to end volumes, if you don’t mind.

Taylor Lauber, CEO, Shift4: Yes, sure. Thanks, Tim. It’s a great question. I would say it starts with a market that for a company like us, really any American company relatively easy to enter compared to some of the other more complex geographies, meaning language barriers are zero, fiscalization of product is much more minimal than some of the more complicated countries in Europe for example. So a product like SkyTab is pretty compatible out of the gates in a place like Australia.

This is lesser known, but Global Blue had a really impressive and emerging payments capability in Australia. They supported a few 100 hotels, for example, with their own full stack payment processing platform. And so while we’ve been looking at SmartPay for a number of years, Global Blue gave us the conviction that that plus SmartPay was a hell of a good idea. In fact, we were debating in our Board meeting how to prioritize these different things. When you saw the two on the same page, it became obvious you had to kind of pursue both of them.

What it gives us is an awesome distribution capability. So the reason that we’re having the kind of scaled success in Europe as quickly as we are is because we’re taking products and know how that we’ve matured in The United States over the past two decades and we’re applying them to markets that are right for those that consolidation of software and payments with established sales forces. And so at the end of the day, we believe SmartPay will give us that established sales force and we’ll bring the products and capabilities to bear.

Timothy Chiodo, Analyst, UBS: Excellent. Thank you, Taylor. That’s really helpful. The item around the modeling or the 200,000,000,000 to $220,000,000,000 in end to end volume, I was hoping you could put some context around if any of the assumptions around implementation of the backlog might have changed at all implied in that 200,000,000 to $220,000,000 And the other item being, we know that there was a small amount of acquiring volume that came over from Global Blue and to what extent that volume is included in the 200,000,000 to $220,000,000,000 for the full year and then obviously specifically in the second half?

Nancy Dissmann, CFO, Shift4: Hey, good morning, Tim. I’ll jump in a little and Taylor could always supplement. As you said, they had a small acquiring business which we have included. It’s well sub $2,000,000,000 from that perspective. So think about that as in relation to our overall guide.

And really we spent some time on the volume bridge and you could see from a blended take rate perspective this quarter which came in very strong, that’s always going to move based on mix. We’ve talked about that if we moved our guide, it would be based on timing of some of our large enterprise deals getting accelerated or delayed, right? So some of that I think is we would say this quarter is completely in line with our expectations. And we looked at the kind of breadth of guide range and felt like even with the high end of that goalpost, we still felt comfortable that it was the right range to stick with even with the small amount of Global Blue acquiring coming in for that Australia business. So really feel great about the backlog sitting pretty much where it was in Q1 just based on things coming in and out.

But it’s really that timing of enterprise go lives that we can’t completely control that is causing us to kind of stick with the guide range that we had.

Timothy Chiodo, Analyst, UBS: Thank you, Nancy.

Conference Operator: Thank you. The next question comes from the line of Will Nance with Goldman Sachs. Please proceed with your questions.

Will Nance, Analyst, Goldman Sachs: Hey guys, I appreciate you taking the question. I’m wondering if you can talk about some of the European restaurant initiatives. You’ve continued to talk about the pace of SkyTet systems installs across UK and Ireland as well as some of the Vectron cross sell. So you just talked upon about some of the benefits of entering a place like Australia where the localization is not as intense. Wondering if you could talk about kind of where you stand on the German market?

And then separately, just kind of what you’re seeing out of The UK and Ireland from net adds and just remind us where you are on distribution in those markets?

Taylor Lauber, CEO, Shift4: Yes, sure. All going kind of well and as expected. Maybe one thing that we neglected to mention is that formal control of the Vectron business was completed in Q2. So we’re able to kind of pull some of the operational levers that we would not be we were not able to control. So production is ramping really nicely inside of that business and wake of what I think were kind of a handful of quarters apologizing for the slower pace than we had initially expected when we announced the transaction kind of well over a year ago.

So Vectron is going really nicely. Just to remind the audience, this is the idea of attaching payments to a really large basket of awesome established Vectron customers. And then over time, we can go back and sell SkyTap into this population. It’s a market that requires more fiscalization requirements, more customization of the software for the local German market and we’re able to do that. Vectron also has a sales force that kind of extends beyond just Germany.

So that sales force is ramping up as well introducing our payments product to their established customers and any new customers they come across. That’s all going great. I’m like really thrilled that the acquisition well over a year in the making has kind of largely come to fruition at this point in time, learned a ton through that process. In The U. K.

And Ireland, it is a similar story, which is we have a large established group of salespeople now introducing the SkyTap product across a variety of merchants and it’s going incredibly well. The one thing I would say to kind of moderate expectations is that generally speaking these European businesses are a little smaller, although we are seeing spreads that are better than we originally modeled because investors are I’m sorry merchants are embracing this kind of software integrated product in mass. So the markets are contributing really nicely. We actually struggled early on to get our boarding capabilities ready to deal with the onslaught, but we are there now and we’re boarding kind of as I mentioned well over 1,000 merchants a month across the market.

Will Nance, Analyst, Goldman Sachs: Awesome. No, that’s great. And then you hit a little bit on some of the spreads outperforming in European markets. Is that the primary reason why you’re sounding a bit more constructive on spreads and just any other puts and takes across the business that are worth calling out as you think about pricing dynamics?

Taylor Lauber, CEO, Shift4: Yes, sure. So I think it’s important to think about the evolution of our business which is that at the time of our IPO we had this really, really large gateway cross sell opportunity and every gateway customer was kind of meaningfully larger than the average customer in our book and we are also adding capabilities like stadiums, enterprise, etcetera. What that meant was higher volume per merchant kind of every single month and a moderation in spreads down to kind of the 60 basis point level, which if you go back to the early calls, that’s about where we predicted it would land. As you start to expand internationally, you’re boarding the same number of merchants you are globally, but you’re also adding on merchants internationally that are a little bit smaller than that average cohort. So this is where volume moderates on a per merchant basis a little bit, But we underwrite every one of these transactions we do incredibly conservatively and I think that’s kind of showing itself in the spreads we’re seeing from international customers meaning they are willing to embrace a higher cost product if you’re delivering all this value of software plus payments plus hardware all tightly integrated together.

So I think over time this kind of volume per merchant will continue to evolve as we expand into new markets. But the spreads embedded in a software plus payments product are strong. They’ve historically been very strong in The United States. And as we teach kind of the rest of the world the benefits you get from all this integration, I think they’re willing to pay a little more than a traditional bank term loan.

Will Nance, Analyst, Goldman Sachs: Great. Thanks for taking the questions guys. And congrats Nancy. It’s been great working with you.

Nancy Dissmann, CFO, Shift4: Thank you.

Conference Operator: Our next questions are from the line of Dominic Vaughan with Rothschild and Company. Please proceed with your question.

Dominic Vaughan, Analyst, Rothschild and Company: Hello, Taylor, Tom, Nancy. Nancy, it’s been a pleasure to work with you. Chris, very nice to meet you as well. So our question is Shift4 has been very good on execution on store small acquisitions, rolling out SkyTab, consolidating systems, removing brands. Global Blue does seem like quite a different asset.

It’s a lot larger consumer facing geographically distant. So what is the sort of integration strategy evolving for the steel and what safeguards have you implemented to avoid the sort of strategic missteps that we’ve seen from others in the industry with scale and into transformational M and A? Thank you.

Taylor Lauber, CEO, Shift4: Yes. It’s actually probably the question, right as we embark on this journey. It’s 2,000 employees. They’re all located outside The United States. It’s a large acquisition from a cultural perspective.

I will say we learned a lot of lessons from our early international acquisitions which is the pace of getting an acquisition closed always takes longer than you anticipate when you’re dealing kind of cross border in the regulatory environments there. Happy to report this deal closed kind of well within our expectations or at least the expectations we set for the Street, which is great. And then if I were to pull you into kind of the 80 pager we sent the Board kind of rationalizing this transaction, the number one deal objective was keep the current momentum that the Global Blue business has had for the last five years and don’t disrupt that as a result of your kind of cross sell ambitions. So what does that mean? It means we are as quick as we always have been to integrate functions like finance and legal and HR, but a little bit slower to kind of disrupt the day to day business model that exists inside the business.

Jacques who is the CEO of Global Blue is now President of Shift4 International. Our non U. S. Functions will report into him to make sure he’s building a consistent organizational structure that we can operate from and that their TFS business which is like really, really dominant continues to win at the pace it’s been winning at. Over time, we’re going to take the conversations that Global Blue naturally has with their customers and introduce a much broader suite of payment products.

But I think as we set kind of expectations around our Investor Day, we’re going to take a little bit more time than we would in a smaller acquisition in The United States for example.

Dominic Vaughan, Analyst, Rothschild and Company: No, makes sense and it’s a lot more sensible as well. When it comes to the $1,000,000,000,000 in cross sell, I believe $500,000,000,000 of that, let’s say half, derives from Global Blue. Can we have a bit of a breakdown or cadence of where the rest comes from? And maybe how much of that do you sort of try and plan to migrate to ship for annually? Also what are targets there?

Thank you.

Taylor Lauber, CEO, Shift4: Yes, sure. So setting aside the $500,000,000,000 of Global Blue which is comprised of global retailers, local boutiques, international department stores, etcetera, the remaining $500,000,000,000 is from a combination of different acquisitions that we’ve done whether that be Give X which was a really large gift card franchise. Again, fulfilling a pretty small function of the overall payments value chain, but a critical and sticky one across really big merchants, the likes of a Nike for example, who work with Givex. Aiken was not a trivial gateway with about $30,000,000,000 of payment volume flowing through that. So and then you’ve got still large contributors in the likes of a Rebel and other things.

So again, we sort of view the strategic imperative to be to keep that cross sell funnel as full as possible. They all are on different cylinders. Small customers move faster than big customers, certain verticals move faster than others. Everyone has their own kind of purchasing cycle. But as long as we can keep that funnel really, really big, you’ve got an embedded base of customers to go talk to.

I referenced in my scripted remarks, we had several Global Blue customers reach out to us proactively through their account management teams at Global Blue saying everything Shift4 is saying about our payments stack and its complexity is correct. We would love to find ways to simplify this over time. So again, our products are awesome. We are a category leader in hotels and restaurants and stadiums and now in global retail. So the product suite is incredibly strong.

It’s about introductions to customers and those customers are so much more quick to answer the phone when you’re already fulfilling a core function for them. So that’s what the acquisition side of the coin kind of helps supplement inside of the business.

Dominic Vaughan, Analyst, Rothschild and Company: Great. Thank you, Tyler.

Conference Operator: Our next questions are from the line of Darrin Peller with Wolfe Research. Please proceed with your questions.

Darrin Peller, Analyst, Wolfe Research: Hey, guys. Nancy, all the best with and congrats on the announcement. And Chris, congrats as well. Guys, I just want to touch base on the underlying trends in the business and maybe help us understand what you’re seeing macro and consumer standpoint in the underlying sub segments. And then even looking now into July and August, a little more color on that.

And then maybe as a sort of attached to that is what assumptions on the consumer and the underlying? I know same store sales is only a minor contribution to your underlying growth. But just help us understand what you’re embedding in the organic outlook of the business, Global Glue aside for a moment.

Taylor Lauber, CEO, Shift4: Yes, sure. I’ll talk about the consumer for a little bit and then I’ll pass it over to Nancy. I think the trends are largely as we’ve seen for a long time now. And I mean like longer than a year which is there’s pressure undoubtedly but it’s very modest inside the restaurant vertical itself. I say this because restaurants have come off of really awesome years in the recovery of COVID and a modest single digit same store sales compression.

I think we anticipated and quite frankly anticipated a year before it actually occurred. So that’s been a steady trend, no real meaningful difference from what we would have talked about in other earnings calls. It becomes more moderated as we look around the world because that trend does not exist everywhere which is encouraging. Hotels are kind of flat which again these are off of pretty awesome travel years. And I think if your Instagram feed looks anything like mine everyone seems to be traveling to Europe these days which is encouraging for both our hotel business and for Global Blue business.

So I would say consumer trends seem pretty stable. Our base of retail is grown quite a bit with the inclusion of Global Blue. We’ll start to get more insights into that over time, but nothing really surprising. Nancy, anything you want to add in?

Nancy Dissmann, CFO, Shift4: Pretty much, I will sound more like a repeat, but just signs of overall stable consumer spending trends largely in line with what we saw exiting Q2 twenty twenty four, I’m sorry, and in Q1. I would say really since mid last year, we’ve seen it fairly stable. I know we’ve given out before kind of a flat to minus two on restaurants and a range on hotels of maybe a minus two to a plus two. And I feel like we’re still within that corridor. So, really not much changing.

And I think we always comment that we’re pretty resilient during uncertain times, but these really haven’t we haven’t seen uncertainty like we’ve kind of planned for that range of expectations and that’s what we’re still seeing in the current market conditions.

Darrin Peller, Analyst, Wolfe Research: Okay. That’s great to hear. Thanks. Just one quick follow-up would be on I know Global Loop, the question was somewhat asked, but I’m really trying to understand a little bit more of we understand the opportunity for merchants to utilize GlobalWoo under your ability to help them realize consumers are, for example, in need of a VAT tax reimbursement, something that I don’t think they’ve effectively they could do So the opportunity to cross sell seems pretty material from our perspective. I’m just curious what kind of awareness campaigns you anticipate getting out to the market?

How what kind of timeframe do you anticipate the merchant base understanding these opportunities and cross sell taking hold?

Taylor Lauber, CEO, Shift4: Yes. It’s a great question and it’s really important I think whether it’s kind of the acquisition of Shift4 from many years ago all the way through to now, we’ve learned a ton of lessons in this regard. There’s a few what I would call laws of physics in this strategy. The first is small merchants move a heck of a lot faster than large merchants. That’s not just the complexity of the integration.

It’s that when you have like an owner operator single decision maker that’s a same day decision and like a same week implementation versus an enterprise which is deciding over quarters and implementing over years. So we kind of applied that methodology to our conversion strategy. Now that’s a fine thing because you generally earn higher spreads on smaller merchants than you do on larger merchants. Like again, the merchant is still very valuable. So the first product we intend to introduce is kind of a single all in one terminal that makes the life of that merchant a lot easier.

It’s consolidating five or six things on their countertop in that watch boutique or that perfume store in Paris into a single solution that does a lot of what the enterprises have already figured out with that, which is it’s identifying at the point of payment that the consumer is eligible for this and it’s walking the sales representative through what can be a convoluted process in certain geographies. That’s why when you go into the likes of Louis Vuitton in Paris, is an incredibly seamless experience and where you go into another store and they might not be even be aware that you’re eligible for this and prompt you for it. What Global Blue has had a ton of success at doing is increasing the rate within which refunds occur in merchants that were already eligible for a very long period of time and the consumer experience is unparalleled. So we intend to kind of bring that enterprise grade consumer experience and sales experience down to as small a merchant as we can inside the Global Blue ecosystem. And then are already underway on all the really tough stuff.

The tough stuff is integrating all the retail software that sits behind the counter in a large department store or in the likes of a Louis Vuitton for example. Those sales will undoubtedly take more time both to occur and to implement, but you get a ton of volume when they come in.

Darrin Peller, Analyst, Wolfe Research: That’s exciting stuff. Great. Thanks, Tyler.

Conference Operator: Thank you. Our next question is from the line of Darrin Perlin with RBC Capital Markets. Please proceed with your question.

Dan Perlin, Analyst, RBC Capital Markets: Sometimes we get more. It’s Dan Perlin with RBC. Thanks, everyone. So a quick question on Global Blue here again. So the $300,000,000 of adjusted revenue contribution in the second half, I’m just trying to reconcile that to an organic number for them, like what the organic growth rate on that base would be.

Really what the idea is as that starts to anniversary and obviously four quarters from now, it additive to that 20 plus percent number or helping support the duration of that growth?

Taylor Lauber, CEO, Shift4: Yes, sure. So the contribution quite frankly is very consistent with the expectations that they had set for the Street as a standalone public business. So it’s very consistent in that regard. I think they set mid teens level expectations over the medium term. This is a continuation of that theme.

There is a little bit of currency noise and I think we have to do a better job of kind of educating you all on this. It is not your traditional European business that whereby a depreciated dollar is net positive when you think about results like a depreciated dollar means less shopping in Europe and then it’s translated back into U. S. Dollar results. So there’s a little work to kind of explain the currency dynamics inside the business.

But in general the business is performing quite well. They continue to win and it’s very consistent with the trends that they’ve been expecting as a standalone business. And in large part we represent it that way because we don’t intend to have meaningful synergies in the back half of the year across the business. This was one and I think we set these expectations back in February that we said we want to take time to get the product solution right and get the conversations with customers in the right spot. Timing of the close was somewhat uncertain at the time and so our product teams and our go to market teams are heavy at work and we hope to surprise you in that regard.

But the reported contribution as described here and we put a bridge in the materials to kind of help people get from what they would traditionally report as numbers to how they manifest themselves in our financials is exactly what they had kind of set forth to the Street as a standalone business.

Dan Perlin, Analyst, RBC Capital Markets: Yes. Okay. That’s super helpful. I think it’s super helpful as well. Just one other one quickly on Global Blue.

Understanding the synergies are not to materialize in 2025, but obviously starting in 2026. But just trying to understand the areas or the plan of attack first. I think you’ve talked in the past about maybe the DCC product being something that could be attached to a lot of the hotels here domestically and that might be an area of kind of first attachment. But then also thinking through the SMB book that they have and the opportunities around SkyTab and payments. So just anything to help us think about maybe the order of operation in terms of what you’re going to attack first?

Dominic Vaughan, Analyst, Rothschild and Company: Thank you.

Taylor Lauber, CEO, Shift4: Yes. Great question. So it is worth segmenting into the two populations, two large cohorts of products within the Global Blue Suite. So the currency conversion product that’s already intensely underway from a technical integration standpoint and that’s the ability for us to introduce that product to our own customers where we traditionally have not offered that. That applies both in Europe and to The United States.

It takes a little bit longer to implement in The United States. But once that’s done, we expect the uptick of that product adoption to be near instantaneous. This is something that merchants generally just turn on. It’s not a cost for them. In fact, it can be a revenue driver for them.

So merchants accept this product. It’s not even really a sale as much as it is just turn it on and educate them on how it works so that when the consumer is prompted they understand how to walk them through it. That will happen in a more binary sense, again giving ourselves the time to get the technical implementation right, but it will be more binary and then we’ll introduce that product as part of our standard offering over time. The payments cross sell has more complexity to it. Again, the concept that smaller merchants generally adopt to the cross sell faster because it’s a single decision maker we believe to play true.

But it’s generally kind of a mid-twenty six level where you’re like got a full suite of products in enough countries that you can sell on a reliable basis. Keep in mind there’s payment I don’t want to overcomplicate the situation, but there’s payment integrations that become more relevant for one market or another. There’s really making sure that the software works incredibly well and that transition from payment to that experience is seamless. We want to get that right and we don’t want to disrupt their core business which has been winning a lot. So you’ll notice a prudence in kind of the integration plan here that is somewhat atypical of acquisitions that we do at Shift4 because we’re not trying to break their go to market model immediately the way we have with other businesses.

Dan Perlin, Analyst, RBC Capital Markets: Great. Thank you so much.

Conference Operator: Our next questions are from the line of Dan Dolev with Mizuho. Great

Darrin Peller, Analyst, Wolfe Research: results

Dan Dolev, Analyst, Mizuho: here. Taylor, maybe a higher level question about kind of the how stablecoins fit into the merchant acquiring process. Our house view is that there’s no disruption whatsoever, but interested in your views on how you see kind of stablecoin fitting into consumer commerce that would be great? Thank you.

Taylor Lauber, CEO, Shift4: Yes, sure. I think it’s important to kind of separate two views. View is a product supplier to our customers and then kind of the longer term view of what do we think this thing is going to do to the overall economy. To the first point there, we are in the business of helping merchants accept whatever currencies they view as most valuable to them conducting commerce. It’s in our earnings materials.

We’re helping Blue Origin accept cryptocurrency and stablecoins for space flights. They view that as valuable. We enable that and we always want to be on the cutting edge of enabling merchants to accept what they think is most relevant. With regard to the broader applicability of stablecoins, think it has the most applicability in cross border where consumers in certain countries that have a rapidly inflating currency might want to hold on to something that’s not that currency and stablecoins do provide a mechanism for them to do that in a somewhat efficient way. And to the extent they’re holding on to that stuff, merchants obviously around the world would like to take that.

So we’re in the business of enabling it. I think in larger more established markets like The United States, I think the value that the traditional card brands offer is almost always misunderstood. There’s a heck of a lot of value you get as a user of the Visa network or the American Express network or the MasterCard network that is embedded in some of those costs that you pay. And consumers undoubtedly over time have reverted to those methodologies. A U.

S. Consumer using stablecoins in The United States doesn’t get near the value from that transaction that they get in the form of fraud protection and chargeback insurance and rewards and all the other stuff that you get as a traditional card scheme member. So hopefully you get kind of the two sides of the brain there which is, I don’t think it’s going to disrupt the world in The United States. I think it’s got some applicability in other markets. And I think adoption of those from those other markets will always be under kind of some level of regulatory scrutiny, which will slow progress.

With that being said, if merchants see value in it and want to take it, we’re going to enable them as quickly as possible and I think we’ve done that.

Dan Dolev, Analyst, Mizuho: Yes, we agree. Thank you so much and congrats again. Great quarter.

Conference Operator: Our next questions are from the line of Sanjay Sakhrani with KBW. Please proceed with your questions.

Thomas McCroen, EVP, Investor Relations, Shift40: Thank you. Good morning. Taylor, it seems like you guys are making a lot of progress on multiple fronts from what I heard from your prepared remarks. I guess when we think about some of the organic growth opportunities over the next year and a half, like where do you think you have the most potential for outperformance? And where are the biggest risks?

Taylor Lauber, CEO, Shift4: So SkyTab is undoubtedly hitting its stride. We see that nationally. The adoption is incredible. We also see it in The United States. I think you can even just go to Twitter and see the number of installs that we’re doing or some portion of them every single day.

So the SkyTap product and our ability to kind of maintain and grow our position in the restaurant vertical is kind of top of the list from a product initiative standpoint inside the company. Once you step away from that, you’ve got a payments platform that needs to be able to support some of the most complex circumstances in the world and we find tons of relevance for that every single day whether it’s kind of the enterprise customers that we’re signing up or the ability to instantly turn on geographies for some of the customers that are expanding rapidly around the world. That’s kind of the two largest focuses of product investment. Obviously, our stadium product benefits from both of those things when we invest in that regard. Having kind of a world class business supporting hotels, restaurants stadiums is going to have relevance all over the world.

And again, we’re like, I don’t know, nine months into supporting Europe in even a trivial way and we’re adding kind of thousands of merchants very quickly as a result of that. That’s the organic business doing its thing. And then what we try to do is supplement that with what we call a foot in the door or a shot on goal through acquisitions where we can inherit customers that have traditionally owned a larger and more complicated payment stack and want to work with fewer vendors, but the solution isn’t otherwise available. So you’ll see that manifest itself in us introducing our traditional payments products to Global Blue customers in a way that integrates what had been a complicated handoff for them in some cases in the past. Same thing with GIVEX customers, same thing with Revel customers, etcetera.

So I know I said a lot there, but this is really about taking products that we know have market appetite organically and getting them in as many geographies as we can as quickly as possible. SmartPay is a great example of that. We anticipate the transactional close kind of inside of Q4. So I don’t want to get ahead of ourselves but that SmartPay team is going to get an entirely new set of products as a result of being part of the Shift4 franchise. What they offer to customers will look nothing like what they have done in the past and that is kind of taking the both sides of that coin that I mentioned and delivering them all at once.

Thomas McCroen, EVP, Investor Relations, Shift40: Got it. Thank you. And sorry I meant to say congratulations to Nancy and Chris. But maybe just a question on the outlook. And Taylor, you mentioned the most likely case seems in view now.

And if you do the math, it just seems like organic growth can get you there after this year. I’m just curious if we think about the M and A pipeline and sort of what you would want to do over the next two years, should we expect that that’s minimal because you’re still integrating Global Blue? And then as we think about like the organic growth potential of Global Blue, think those that was asked in many different ways. Like is that like is it equal, dilutive to sort of like the core organic growth rate ex Global Blue? I’m just trying to think through the algorithm as we think about the most likely case occurring.

Thanks.

Taylor Lauber, CEO, Shift4: Yes, sure. So Global Blue will continue to and we tried to lay this out in our Investor Day materials. The organic contribution of business without ever adding customers via M and A is quite strong and that’s like what we think is something like mid teens as we go out like multiple years. So yes, we believe our ability to deliver our core products into new markets is quite strong and our product positioning inside of these markets is very good. Global Blue adds on an entirely new market for us.

So we try to represent that in a somewhat I think conservative way, which is that we kind of let investors choose their own adventure, which is Global Blue continues to execute as is or they slow down and we introduce cross sell. Either way, you can get to the same spot. I think neither of those is the likely scenario. I think they continue to execute and we introduce products and I think they accelerate beyond what they’ve traditionally done and what we’ve laid out in the forecast. That’s something that I think when you add their capabilities and talent to our product suite, think you can get there reasonably easily.

The whole point of the most likely scenario is we intend to reinvest our capital into ways to improve whether it’s our market positioning or our go to market pipeline. And I feel really strongly about this and I know it’s somewhat controversial. What the Vectron sales team gave us in Germany is a massive accelerant into that market versus going it alone. We believe the SmartPay team can do that for us as just another example in Australia and that’s like two countries in a really, really big world. So we hope that through thoughtful capital allocation we can accelerate the introduction of our products in these markets and we intend to do that.

And I would say after just a very, very short period of people thinking about Global Blue and Shift4 as a combined entity and now in 50 more countries than we were before, that’s manifesting itself. I mean the number of opportunities we have to get established organizations and bring them in and empower them with product is enormous.

Conference Operator: Thank you. Our next question comes from the line of Rayna Kumar with Oppenheimer. Please proceed with your question.

Thomas McCroen, EVP, Investor Relations, Shift41: Good morning. Thanks for taking my question and congratulations to Nancy and Chris. Could you give us an update on how travel trends are impacting Global Blue? So the last monthly update we got from Global Blue showed a significant slowdown in sales and store growth. Has that recovered this summer?

And what are you seeing so far in the third quarter?

Taylor Lauber, CEO, Shift4: Yes, sure. So it has certainly moderated. And by that I mean that slowdown is not pulling itself through all the summer months. But what I think is important is there are currency pairs that matter a lot when you’re thinking about that business. The two largest are the U.

S. Dollar versus the euro and then secondarily Chinese currency versus neighboring countries whether that’s the yen or the euro as well. All this to say and I’m sorry to pull people back into like into the snooze fest three zero one level courses in college, but lower value of a shopper’s home currency when they’re traveling means that they spend less. When they travel and we saw that by the way in the form of U. S.

Dollar and the Chinese currency being depreciated in the wake of tariffs. Now that is moderated, which is good. You also picked up a busier travel season in general and I think the fear of tariffs in the consumer has moderated as well as we started to see the whole saga play out. All that’s encouraging. And then there’s the very simple manifestation of their reported results which are pretty euro denominated being translated back into dollars which we get a little bit of a tailwind with.

All this to say, lot of currency noise is somewhat ballasted inside the business, but we do pay attention to The U. S. Shopper and the Chinese shopper and how much they’re spending on a regular basis.

Thomas McCroen, EVP, Investor Relations, Shift41: Thanks, Taylor. It’s very helpful. And then one follow-up. So egentic commerce is obviously a very hot topic right now in FinTech. Given the use cases for travel bookings and hotels, are you actively investing in technology or partnerships to explore opportunities in agentic commerce?

And can you talk about what you think are the implications for the industry?

Taylor Lauber, CEO, Shift4: Yes, sure. I would say it’s not dissimilar from the stable point question which is we view it as a strategic imperative to pay attention to where things are going. We do think agentic commerce has the ability to cause some leapfrogs in evolution. Basically a company that kind of creates the right solution will be far ahead of market incumbents as a result of kind of the breakthroughs in technology. With that being said, the travel industry has a lot of established rails that get relied on for this stuff and we think we’re a natural beneficiary of that.

And by the way, yes, we will invest in these technologies and spend a lot of time doing them. And we will apply the same algorithm we always apply which is do we build, do we buy, do we partner when we’ve seen a disruptive scenario in the marketplace. So it’s too early to tell for sure. It’s not something we’re ignoring and it’s something obviously we’re hearing as much of from everyone else. But in general, your average hotel does not want to change its entire tech stack to take advantage of these and they certainly don’t want a separate deposit and a separate point of reconciliation.

So we’ll have relevancy in that kind of regardless of the technologies that emerge.

Nancy Dissmann, CFO, Shift4: Thank you.

Conference Operator: Thank you. Our last question will come from the line of John Davis with Raymond James. Please proceed with your questions.

Thomas McCroen, EVP, Investor Relations, Shift42: Hey, good morning guys. And I’ll add my congrats to Nancy Chris, forward to working with you. And Nancy, we’ll miss you for sure. I’ll leave you with two, Nancy, here.

So first, gross margins, I think down about 150 basis points year to date and they were down last year. How much of that is driven by acquisitions? And how should we think about gross margins kind of in the balance of the year especially once we add in Global Blue?

Nancy Dissmann, CFO, Shift4: Yes. So from a trending perspective, you should expect them to look similar to how they look now, plus or minus. So I think using Q2 trends for remainder of the year will kind of work from a modeling perspective. And I would just say, I know consensus a lot of times has gross margin calculated differently than we look at it internally, because we take the EUL amortization against gross margin. And I would highlight that there will be some purchase accounting implications and amortization into that line from Global Blue as well.

So I would just say if you consider those items and trend based on what we’re seeing this quarter that should get you close.

Thomas McCroen, EVP, Investor Relations, Shift42: Okay. Thanks. And then as we head into 2026, and I know you reiterated the 50% free cash flow conversion this year, but now that Global Blue is closed, maybe help us think about the puts and takes to free cash flow conversion as we get to next year? I think you have higher cash taxes potentially. Just the puts and

Dan Perlin, Analyst, RBC Capital Markets: takes there would be helpful.

Nancy Dissmann, CFO, Shift4: Yes. So a couple of things, but I would say I would caveat this to say that when we come out for 2026 guide, while I won’t be here, I will make sure Chris takes care of you guys this way that we’ll have to give you some more guidance on cash flow because the free cash flow at Global Blue is very seasonal. So what we’ll see in the back half versus what we’ll see the first two quarters next year, there definitely is some real seasonality trends in the way their cash moves. So I don’t want to get ahead of it right now, but I would just place hold that and probably go back to their prior public mark to just take a look at their seasonality. And we’ll think through how we’ll guide that when we come back out for 2026.

They’re a great cash flow generator, but they have more lumpiness to theirs than we do. And of course, will point you guys back to my prepared remarks on cash interest just to make sure we pick that up from the recent debt raise and for sure in cash taxes just consistent with what we’ve guided that those moving up slightly just from income generation if nothing else. So I know there’s a lot of pieces there and we’ll make sure Tom and Paloma are armed to take you guys through it. But absolutely, we’ll be back on that for 2026 guide.

Will Nance, Analyst, Goldman Sachs: Okay. Thank you very much.

Conference Operator: Thank you. At this time, we’ve reached the end of our question and answer session. I hand the floor back to management for closing remarks.

Taylor Lauber, CEO, Shift4: That’s it. We got a long day of callback. So we look forward to speaking to you all then. And thanks very much for joining the call.

Conference Operator: This will conclude today’s conference. You may disconnect your lines at this time. Thank you for your participation.

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