Financial Trends -- 9/10
Near-flawless financial execution. Revenue growth accelerating from +9% in CQ1 25 to +15% in
CQ4 25, driven by VAS momentum and cross-border strength. CY2025 net revenue of $40.0B (+11.3%),
GAAP EPS of $10.20, adjusted FCF of $21.6B with ~54% FCF margin. 5-year revenue CAGR of ~13.5%
and EPS CAGR of ~16%. The only minor ding is CY2025 op margin compression to 60.0% from 65.7%
driven by litigation provisions and higher incentives.
Weight: 25%
CY2025 Net Revenue
$40.0B
+11.3% YoY | 5yr CAGR ~13.5%
CY2025 GAAP EPS
$10.20
+4.8% YoY | 5yr CAGR ~16%
CY2025 Adj FCF
$21.6B
~54% FCF margin | TTM ~$22.9B
CQ4 25 Revenue Growth
+15%
Accelerating from +9% in CQ1 25
Annual Financial Summary (CY2021 - CY2025, $ Millions)
| Metric | CY2021 | CY2022 | CY2023 | CY2024 | CY2025 |
|---|---|---|---|---|---|
| Net Revenue | $24,105M | $29,310M | $32,653M | $35,926M | $40,000M |
| YoY Growth | — | +21.6% | +11.4% | +10.0% | +11.3% |
| Operating Income | $15,804M | $18,813M | $21,000M | $23,595M | $23,994M |
| Op Margin | 65.6% | 64.2% | 64.3% | 65.7% | 60.0% |
| GAAP Diluted EPS | $5.63 | $7.00 | $8.28 | $9.73 | $10.20 |
| EPS YoY Growth | — | +24.3% | +18.3% | +17.5% | +4.8% |
| Adj Free Cash Flow | $14,522M | $17,879M | $19,696M | $18,693M | $21,577M |
Key trends
- Exceptional compounding: 5-year revenue CAGR of ~13.5% and EPS CAGR of ~16.0%. Revenue has grown every year with double-digit growth
- Op margin compressed in CY2025: 60.0% vs 65.7% in CY2024, driven by litigation provisions and higher client incentives. Underlying business margins remain strong
- FCF generation is massive: $21.6B in CY2025, up from $18.7B in CY2024. FCF margin of ~54% of net revenue
- EPS growth slowed in CY2025: +4.8% vs +17.5% prior year, primarily due to the op margin compression. Non-GAAP EPS growth was stronger
8-Quarter Net Revenue and Operating Income ($M)
| Metric | CQ1 24 | CQ2 24 | CQ3 24 | CQ4 24 | CQ1 25 | CQ2 25 | CQ3 25 | CQ4 25 |
|---|---|---|---|---|---|---|---|---|
| Net Revenue | $8,775M | $8,900M | $9,617M | $9,510M | $9,594M | $10,172M | $10,724M | $10,901M |
| YoY Growth | +10% | +10% | +12% | +10% | +9% | +14% | +12% | +15% |
| Operating Income | $5,354M | $5,938M | $6,349M | $6,234M | $5,435M | $6,177M | $6,148M | $6,737M |
| Op Margin | 61.0% | 66.7% | 66.0% | 65.6% | 56.6% | 60.7% | 57.3% | 61.8% |
| Op Inc YoY Growth | -- | -- | -- | -- | +1.5% | +4.0% | -3.2% | +8.1% |
Key trends
- Revenue growth is accelerating: From +9% in CQ1 25 to +15% in CQ4 25 -- four consecutive quarters of improvement. This is a re-acceleration story
- Op margin dip in CQ1 25 was timing: 56.6% reflected litigation provision timing. CQ4 25 showed strong 810bp sequential improvement to 61.8%
- CQ4 25 was the standout quarter: +15% revenue growth, +8.1% op income growth, 61.8% op margin -- all best of the trailing 4 quarters
8-Quarter EPS -- GAAP and Non-GAAP
- CQ4 25 GAAP EPS of $3.03 represents a strong +17% YoY beat. Non-GAAP EPS of $3.17 grew +15% YoY
- Non-GAAP consistently above GAAP: Reflects litigation provision and restructuring adjustments
- Street estimates for FY2026E: ~$13.07 adjusted EPS, implying ~12-13% growth
8-Quarter Adjusted Free Cash Flow ($M)
- FCF generation is consistently robust: TTM adjusted FCF of ~$22.9B versus $580B market cap implies a ~3.9% FCF yield
- CQ4 25 FCF of $6.4B: +26.7% YoY, the strongest quarter in the trailing 8
- FCF yield of ~3.9% is attractive: Above the 5-year average of ~2.5-3.0%, reflecting the valuation discount
Payment Volume and Transaction KPIs (8 Quarters)
- Transaction growth stable at 9-10%: Consistent processed transaction growth reflects the steady drumbeat of the cash-to-digital shift
- Cross-border nominal growth accelerating to 18%: Favorable FX plus strong underlying volume. This is the highest-margin revenue stream
- Cross-border constant dollar at 12%: Solid underlying volume growth stripping out FX. Consistent across the past 4 quarters
Revenue Mix Detail -- CQ4 25 vs CQ4 24 ($M)
Consensus Estimates (FY2026 = Oct 2025 - Sep 2026)
| Metric | FY2026E (Street) | Implied Growth |
|---|---|---|
| Revenue | ~$44.3B | ~10-11% |
| EPS (adj) | ~$13.07 | ~12-13% |
| Analyst Rating | Strong Buy (20 analysts) | Avg PT $399 |
Management FY2026 guidance: Low double-digit adjusted net revenue growth and low double-digit
adjusted EPS growth (nominal basis). Management typically guides conservatively and delivers above.
Score rationale
Score: 9/10 -- Near-flawless financial execution. Revenue growth has been accelerating from +9% in CQ1 25 to +15% in CQ4 25, driven by VAS momentum and cross-border strength. FCF generation is massive at $21.6B in CY2025 with ~54% FCF margins. The 5-year revenue CAGR of ~13.5% and EPS CAGR of ~16% represent exceptional compounding for a $580B market cap business.
The only minor ding is the CY2025 full-year op margin compression (60.0% vs. 65.7% prior year) driven by litigation provisions and higher incentives. Underlying trends are exceptional. The CQ4 25 quarter was the standout: +15% revenue growth, $3.03 GAAP EPS (+17% YoY), $6.4B adj FCF (+27% YoY), and cross-border volume growing 18% nominal.
Data sourced from Daloopa, company filings, and earnings transcripts.