Paymentus at Oppenheimer Conference: Strategic Growth and AI Focus

On Tuesday, 12 August 2025, Paymentus Holdings Inc (NYSE:PAY) presented at the Oppenheimer 28th Annual Technology, Internet & Communications Conference. The company showcased its impressive Q2 performance, driven by a strong revenue increase and transaction growth. CEO Dushyant Sharma and CFO Sanjay Kalra outlined Paymentus’s strategic initiatives, highlighting their focus on AI and a diverse platform to mitigate economic risks.

Key Takeaways

• Q2 revenue surged by 42%, with transactions up 25% year-over-year.
• Paymentus targets a 20-30% compound annual growth rate (CAGR) for both revenue and adjusted EBITDA.
• The company’s platform is designed to be vertical agnostic, serving industries like utilities and telecommunications.
• AgenTiC AI is being leveraged to enhance customer experiences and internal processes.
• Paymentus is strategically positioned to withstand economic downturns due to its focus on non-discretionary spending.

Financial Results

• Revenue Growth: Q2 revenue increased by 42% year-over-year.
• Transaction Volume: Transactions rose by 25% compared to the previous year.
• EBITDA Margin: Incremental adjusted EBITDA margin stood at 54%.
• Long-Term Growth Targets: Aiming for a 20-30% CAGR in both revenue and adjusted EBITDA.
• Working Capital: Approaching $300 million, indicating strong financial health.

Operational Updates

• Vertical Agnostic Platform: Paymentus’s platform can serve a wide range of industries, enhancing its market reach.
• Enterprise Customer Growth: The platform’s adaptability to complex workflows has driven growth among large enterprises.
• AI Integration: AgenTiC AI is being utilized to improve both customer interactions and internal operations.
• Instant Payment Network: Positions Paymentus to serve the entire customer base effectively.
• Enhanced Onboarding: Improved processes developed during the pandemic are now aiding customer acquisition.

Future Outlook

• Revenue Potential: Paymentus is confident in becoming a multibillion-dollar revenue company due to its vast market opportunity.
• Economic Resilience: The company’s focus on non-discretionary spending and diversification across verticals helps mitigate macroeconomic risks.
• AI-Powered Infrastructure: Plans to expand client services using AI technology.
• Capital Allocation Strategy: Emphasizes organic growth, with an openness to mergers and acquisitions if opportunities arise.

Q&A Highlights

• Competitive Edge: Paymentus differentiates itself with a unique platform and ecosystem.
• Economic Risks: The focus on essential spending provides protection against economic downturns.
• Customer Acquisition: Streamlined onboarding and strong client relationships drive growth.
• Capital Strategy: Prioritizes organic growth while maintaining a robust balance sheet.

For a complete understanding of Paymentus’s strategic direction and detailed financial performance, refer to the full transcript below.

Full transcript - Oppenheimer 28th Annual Technology, Internet & Communications Conference:

Reina Kumar, Lead, Fintech Equity Research, Oppenheimer: Good afternoon, everyone. I am Reina Kumar, and I lead, fintech equity research here at Oppenheimer. Today, I am fortunate to have Paymentus management with us, including CEO, Dushyant Sharma, as well as chief financial officer, Sanjay Kalra. Thanks for joining us today.

Dushyant Sharma, CEO, Paymentus: Thank you, Nina, for having us here.

Reina Kumar, Lead, Fintech Equity Research, Oppenheimer: Great. So I’m gonna start out with my questions. However, we do wanna make this as interactive as possible. So feel free to type in any questions you have for Deshant or Sanjay in the the the panelist q and a, and I will be happy to read out any questions out loud. So to start off with, so second quarter revenue, that was up 42%.

Transactions increased 25%. You mentioned, you feel confident about Paymentus’ ability to be a multibillion dollar revenue company. Can you talk about which verticals are using the strongest momentum and where you see the most untapped opportunity?

Dushyant Sharma, CEO, Paymentus: Well, thank you for the question. I think from our perspective, I think what’s actually working extremely well for us is the way we designed our platform. We designed our platform to be the vertical agnostic, so this horizontally scalable platform, as well as we believe that no customer of any size should be too large or too small for the platform. And the reason we were doing that and the reason we designed it that way was because a typical household has, you know, number of bills is ten, twelve, 15, and they continue to rise. And long term, we believe that the company that has the ability to serve all of those bills or a vast majority of those bills is going to be a very desirable platform.

So what’s playing out right now is actually exactly that. We started with the hardest vertical to succeed in, which is utilities. You have three or four areas there. You have water, electricity, gas, and waste and and sewer services and so on. And if you take those aside and you go into insurance and other government services as well, like paying for your taxes and your insurance, your home insurance, auto insurance, life insurance, and then you go into further other vertical that is your telephone and so on.

So, basically, the entirety of our business is focused on the nondiscretionary side of the economy, the the bills you have to pay, you need to pay to continue to, you know, move forward in your life. And in terms of all of as a result of all of this, I think we are seeing tremendous opportunities in all of the verticals. We are not seeing any in fact, all of the verticals, including our core vertical, utility and government services and so on, continues to do extremely well for us. So, we are we find ourselves in a very fortunate situation.

Reina Kumar, Lead, Fintech Equity Research, Oppenheimer: Understood. That that’s very helpful. Can you expand upon what’s driving your success with large enterprise customers? As you continue to scale your business, are you able to offer more attractive economics to these customers while still generating strong operating leverage?

Dushyant Sharma, CEO, Paymentus: I think on the if I may actually start with the operating leverage piece first, I mean, that is fundamental to the design of our business, like the way we have designed our business, the way we have designed our business model. We want we have demonstrated that we can continue to grow the business, continue to maintain our innovation framework while deliver increasing our margins through the strong operating leverage. That strong operating leverage allows us to do serve a vast variety of customers, including the largest clients, where on a per unit basis, the margins may move around. But, overall, the profitability from those accounts is very, very impactful. And what’s drive driving our growth in the enterprise sector is, frankly, all of the hardware we have put into our platform.

We adopted a very different philosophy right from the beginning, which was platform purity was important to us. Having one code base was important to us. It was important that all of our clients are able to consume the same platform, same services, and our platform should have the functionality and the capability that we can address all of the needs of our clients through configurations, not customizations. And the old legacy infrastructure we used to exist was very custom built, highly customized for each client. So if a client requires new in first new requirements, now you’re having to reopen the code and go through months and months of cycle of custom development, if not years.

Clients are tired of that, whether that service provider is internal, in house service provider, or external legacy third party. They want change. They want change at the speed of light or speed of business, and they want an ability to be able to meet the requirements whether they’re regulatory or business needs and their platforms to react that way. So that’s what is driving our success.

Reina Kumar, Lead, Fintech Equity Research, Oppenheimer: Understood. You discussed some of this on your earning call, but can you explain in a bit more detail on how AgenTiC AI has a has a potential to fuel future revenue growth for Paymentus?

Dushyant Sharma, CEO, Paymentus: Yeah. I mean, Rina, that’s one of the things we wanted to call out was we we we felt that I think our investors need to know that in in very simple terms, that Paymentus is as as excited as it can be or any business can be about AI revolution. The primary drivers are for for any company to be successful within an enterprise to be able to modernize using agentic AI, there are few fundamental principles. First is, can you handle my this is any organization will ask you the same question. Can you handle my data?

Can you handle my data securely? Can you handle my data in a way that if you’re improving the processes and the decision making capabilities for my organization, that growth that secret algorithm is not somehow transported to my competitors. So I’m a a large business, and I’m operating the I used AI and AI models, and all of a sudden, I used my data to train the AI model, and now my competitor is getting better. So some of those things which are fundamental to any business, Paymentus already does them and does really well. We know how to handle and separate and securely manage a client’s data resources and data lakes while managing thousands more on the same platform.

And then on top of that, how do we handle the security, the complexity of the workflows? And all of those things we already do extremely well, and we do all of this while only charging per on a per transaction basis. So from our perspective, we are ripe for success because as the software seems to be losing a little bit of its luster because of the AI involvement now in in the business processes, we are as excited as we can be. So how we will start to help our clients? And, obviously, I wanna make sure that our investors know that we are already using AI for productivity purposes, and you can see expanding margins and so on.

So you’re already seeing some impact of that in our business, and you’ve been seeing that for a while, expanding margins. But, externally, what we are saying is we’re gonna start with the ex improving the customer experiences using AI, and then we will dovetail that into the improving the internal processes for the organizations we serve. And our main goal will remain that we want to do more and more business for and serve more and more of our clients using our infrastructure, which will be AI powered.

Reina Kumar, Lead, Fintech Equity Research, Oppenheimer: Understood. It’s very helpful detail. What’s your view on the competitive dynamics in the space, and how how do you think you’re differentiating your instant payment network to maintain an edge?

Dushyant Sharma, CEO, Paymentus: Yeah. I mean, I think overall, not just obviously, our propriety network and some payment network is is big and unique. But more than that, I think the overall infrastructure, the the the platform, as I talked about a little bit earlier, the way we have designed our platform, the all functionality, the capability of the platform we have built is now uniquely differentiated. Customers are and after using it for years, customers enjoying and are becoming a pretty strong promoters for us as we are growing our customer base. And so overall, the platform, the ecosystem via build, the instant payment network you’ve called out, all of that actually is unique and in in two ways.

One is that is it is offering differentiated capability that you otherwise won’t be able to get that easily. Like, even a large organization is not gonna be able to build payment us regardless of how many floors of programmers and engineers you have. It is the it has taken us years to build all of those capabilities where you can implement complex workflows without programming. So that’s the one part. The the second part is all the rails we have put in place for payment as platform to be universally available to all of your customers.

Instant payment network is a way for a given business, a billing company to reach all of your all of their customers, not just the ones which are interacting directly on our platform. But if you’re walking into the retail store making a cash payment, that payment should take place in real time using our platform. You’re going to a bank site to make a payment. That plat that payment could take place using our platform. So we are trying this instant payment network uniquely positions us to be able to serve 100% of a given customer base, not just the ones who are coming to our platform directly.

Reina Kumar, Lead, Fintech Equity Research, Oppenheimer: Got it. Okay. It’s helpful. If and just as a reminder, if anyone has any questions for Deshant or Sanjay, feel free to type them in. I’m happy to read them out loud.

So in the meantime, what macroeconomic trends do you think pose the biggest risk to, you know, your continued strength and volume and revenue growth? And what levers, you know, do you have to hedge against, you know, a negative macro environment? I know you did talk heavily about just, you know, being focused on nondiscretionary spending, but just wanna know what do you think is most at risk in a negative macro environment.

Dushyant Sharma, CEO, Paymentus: I think in in we we are actually in a different frame of mind where we are rather excited because of the way the positioning of the business is, where you rightly pointed out about serving the nondiscretionary side of The US economy puts us in a very very fortunate situation where we are actually able to deliver good results and and and somewhat insulated from all the macroeconomic environments. And long I mean, we have dealt with various economic events over the tenure of our business in 2008 to 02/2012. And at 10/12, we had COVID, obviously, inflationary challenges we all dealt with, and we continue to grow the business. So I think we have a proven ability at this point that the business is built around a very specific need the businesses have, which is we are provided the service, and the services we are providing are very important to a typical household, and we need to get paid. And who can help us get those monies in the door quickly and efficiently without losing our shirt and collecting.

And that’s what we are doing. That’s what we are providing. So we find ourselves in a very fortunate situation.

Sanjay Kalra, Chief Financial Officer, Paymentus: And, Ryan, if I may just add that the diversity we have seen over the years, by expanding into multiple verticals have kind of reduced our risk from macroeconomic challenges. You know, if we go years back when the company was more focused only on utilities, would say, we were more prone to economic impacts of inflation and whatnot. But given we have moved and we’ve, kind of diversified into many verticals, including financial services, insurance, government, telecommunications, health care, and whatnot. So any business, you know, we are our platform is agnostic to any business. And as far as we keep on diversifying, that’s one thing which is helping us shield the economic challenges in a better way.

At the same time, the scale which we have achieved of the company, that has given us immense immunity towards dealing with these challenges. And we still impact these things still impact us, but not to that extent that they used to. So I think both these things have really helped us become more stable and project our durability of revenue and even be able to guide kind of give a give a long term model which we talk about. Despite of knowing the economic challenges, we are confident talking about it. I think that’s that speaks to the fact that these things are not as impactful to us as maybe to other companies who are not into the kind of verticals we are in.

Reina Kumar, Lead, Fintech Equity Research, Oppenheimer: Understood. Okay. That that’s really helpful. The color. If you guys would discuss your customer acquisition strategy, and I know on your earning call, you discussed Paymentus’ ability to replace broad based legacy infrastructure within an enterprise.

What’s the strategy to get those customers to move off of that infrastructure over to Paymentus?

Dushyant Sharma, CEO, Paymentus: Yeah. I think as you can see, we have referred to that in in our calls that and and frankly, it is actually being well received by our clients because they all look at our transcripts as well. The the main main thing which is helping us is that during the COVID period, we had to become very, very good at understanding how we can onboard the customers without actually being on-site, especially the large ones. And so we made a lot of enhancements into our platform, the processes, and so on. And now the the when the COVID is sort of well behind us, at least from its major impact, and and we are back to being able to meet our clients face to face, it has actually created a little bit of a tailwind for us.

We’re able to whiteboard solutions, use the tools we have built over the years to quickly onboard the clients or at least demonstrate the how quickly we can migrate the data. And since we have been doing it for a while, we have done it in a very complex, diverse verticals. It becomes very comforting for the clients. And you’re absolutely right. It is a it’s a very important undertaking for any organization.

And to replace the legacy infrastructure with Paymentus, it is they take it very seriously. But they become very comfortable not just looking at our public discourse on this topic, and they can see through the numbers themselves, but also because of what we’re able to demonstrate to them. We handhold the entire process. They can see exactly how well we have architected our solution of on our onboarding solution. All all the instrumentation is driven to make it easy for them to onboard on us without having to do a lot of changes on theirs their end.

So that is that is what is driving the it actually ends up being a catalyzing event for us because of what we have built on the onboarding engineering side.

Reina Kumar, Lead, Fintech Equity Research, Oppenheimer: Understood. You know, moving on to your partnership ecosystem, who are your primary channel partners, and how do the economics compare when when acquiring transactions through the partnership ecosystem versus your own direct go to market strategy?

Dushyant Sharma, CEO, Paymentus: I think that is one of our key strengths of our business. What what we our go to market strategy, which used to be focused directly reaching out to the clients, we were able to successfully take our time to choose the right partnership strategy, which was neutral from a financial impact perspective for both both economically, but also from a growth perspective, the efficiency of getting the deals done. And and based on that strategy, we decided various channel strategies. So for example, we said, why can’t the folks who we are giving business to from payment processing perspective could also help us, grow our business, as they encounter similar, situations where paymentless platform could be useful? Likewise, bank partners, similarly software vendors.

And all of the other vendors that come they’re they’re part of this the life cycle of a given organization’s delivery. We are partnering with them at increasing pace, and our partnership is Shipley’s ecosystem is very strong. And and and frankly, the way it is working is there is no frustration which are typically that exist. The the dichotomy, if you will. The one side you have the direct strategy and the other side you have the partnership strategy.

We have been able to find the right balance between the two and and work hand in hand together in many cases. So that’s partnership remains a very strong very strong go to market strategy for us, complementing our direct go to market strategy.

Reina Kumar, Lead, Fintech Equity Research, Oppenheimer: Understood. Two q incremental adjusted EBITDA margin is 54%. What’s driving your increase in incremental margins, and how sustainable do you think that is?

Sanjay Kalra, Chief Financial Officer, Paymentus: Well, let me ask, answer the last part first. It is sustainable, and it is sustainable for a long term, we believe. Given the operating leverage on the business is high, and it’s coming to light only now as we are scaling the business. The scale will definitely highlight it more and more as we progress and move forward, not only to more verticals, but as our platform gets used more and more, we will see that coming to light. And that’s that’s the best part about this business model.

And, in the middle incrementally be the margins. You’ve seen the trends for the past few quarters, and that’s definitely going in line with the way the business growth is coming in. So we don’t need to spend as much for whether it’s sales and marketing, whether it’s r and d or g and a. So as much as the contribution profit or gross margin comes into play. So when they fall, the majority of them fall to the bottom line instead of us spending all the money.

We do, at times, make, decisions to spend on sales and marketing given the operating leverage is high, and we might wanna use the strong pipeline in front of us to convert the bookings. And that’s the right investment for the company. So we, at times, do make this make those decisions. And as our shared business model, we recalibrate our expenses based on how the margins are coming in. So we would we would take those opportunities at times for the right reasons.

But overall, in the longer term to model the business, I think it’s it’s reasonable to assume that longer term the margins will get better. And our long term model is, in play in terms of we believe the long term CAGR 20% top line growth, I e gross revenue, and the bottom line adjusted EBITDA dollars to grow between 2030%. That that is we are very confident about.

Reina Kumar, Lead, Fintech Equity Research, Oppenheimer: Understood. Okay. That’s good insight. Can you talk a little bit about your capital allocation strategy and what m and a opportunities you’re seeing out there?

Sanjay Kalra, Chief Financial Officer, Paymentus: Yeah. So in terms of capital allocation, our priorities remain unchanged since some time, and we wanna focus more on organic growth. And we are sitting on a very decent amount of cash on our balance sheet, and total working capital is approximately approaching $300,000,000. So we feel very good about our balance sheet strength, and we would like to use that or keep it available for working capital needs, which would be needed to grow our business organically, given we have got a very strong pipeline and the TAM itself, which we operate in, and the kind of the growth we have experienced in the past few years, and we wanna keep marching on that path, keeping our long term model in in sight. So we think at times for scaling the business, you might need cash, and that’s the right investment for us, and that’s the right place for us to spend the cash in and keep the capital available for.

But in the meantime, we are also growing cash and if the working capital needs don’t need that cash, we might need that we might keep that cash as approach to look at any m and a, but that’s definitely not on the cards. There’s nothing in play, and there’s nothing which we are targeting for. That’s only in case we wanna do something at some point and some interesting opportunity comes into play. So there’s nothing which we really need to fill in our gaps in the road map, whether it’s for fee for any product features or any particular verticals. I think we are self sufficient in terms of our technology platform.

So it’s more of an opportunistic view rather than a needs view for the company on m and a.

Reina Kumar, Lead, Fintech Equity Research, Oppenheimer: Got it. Okay. Helpful. I you know, as as you look at the business for the next one to two years, what are you both excited about the most, and what else keeps you up at night?

Dushyant Sharma, CEO, Paymentus: I think, you know, when you’re running a twenty four seven business, you’re always on in some ways. The business is, you know, it’s a it’s a twenty four seven business. So the so, you know, what keeps you up at night to make sure that business continues to run twenty four seven and runs well. But in terms of the opportunities, what is exciting, I think we have we feel like that we are at a perfect inflection point. We have a sizable market opportunity.

In fact, huge market opportunity. There are trillions of dollars here, and this is this is not like a traditional payment solution. This is actually a platform where businesses are running their entire life cycle of customer engagement and billing and payments on our platform. So as so it ends up being very additive as with each biller you’re adding, your platform is learning, you are learning, but also you’re getting revenue and through operating leverage profitability. So we feel like that we build the scale and infrastructure and the market has opened up and it has moved in our direction.

And as a result, next couple of years, we are looking forward to not only deliver on our Kiger model, but also set the con continue to set the foundation for Paymentus to be a very successful business for years to come even after that. Sanjay, you want to add?

Sanjay Kalra, Chief Financial Officer, Paymentus: Yeah. I’ll I’ll say from my perspective, the best part about this business is the visibility we have and the durability of the growth we have seen and the durability we have today. It just keeps on getting better and better as we proceed from one quarter to the next. And the operating leverage on the business is coming to coming to light as we are scaling. So I think from a risk profile perspective, given the strong TAM and pipeline we have and the strong bookings and backlog growth we have seen, especially the cash generating ability we have in the business, it’s just very exciting and it’s not easy to find in today’s market.

So we feel I mean, we remain very excited about the times to come and prosper much better from where we are.

Reina Kumar, Lead, Fintech Equity Research, Oppenheimer: Great. So we only have a few minutes left. So, you know, is there anything I didn’t ask you, Dushyant or Sanjay, that you would like to highlight to investors?

Sanjay Kalra, Chief Financial Officer, Paymentus: Sanjay? Well, I just shared my view as well, and I say we remain excited about the growth opportunities in front of us, and especially q two, which we just exited. We are exiting at a very good situation on our balance sheet, on our backlog, on our line of sight, and our operating leverage. We feel great that we have a strong platform which can cover lot of non discretionary services across a variety of vertical verticals. Our backbone is dependent on on lot of business and lot of bills getting paid.

And as more and more bills are gonna get paid and as more and more bills are gonna get digitalized as not only technology advances, but as the new generation starts to come on paying more bills, more digitally than manual bills, I think there is an inherent growth, inherent leverage in this business automatically built. So we we feel very excited, and we are looking for our next steps in the business.

Reina Kumar, Lead, Fintech Equity Research, Oppenheimer: Great. Okay. Well, Dushyad, Sanjay, thanks for joining us today. And to everyone else listening, thanks for listening. And if you have any questions, feel free to reach out to me.

Have a great

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