Financial Trends -- 8/10

Among the strongest financial profiles in the coverage universe -- a >50%-share network operating at 60-66% operating margins, ~55-60% FCF margins, and a steadily shrinking share count. Net revenue is re-accelerating: FQ2'26 printed +17% reported / +16% constant-dollar, the fastest since 2022, led by cross-border, data processing, and 25%+ growth in VAS and CMS that mix-shift toward higher-margin revenue. The lone blemish is the FY2025 GAAP op-margin dip to 60.0% on an elevated litigation provision -- not structural cost creep; FQ2'26 snapped back to 64.4%. No penalty modifiers apply. Weight: 25%

FQ2'26 Net Revenue

$11.23B

src | +17% reported / +16% cc | Accelerating

Op Margin

64.4%

FQ2'26 GAAP | Best-in-class

Adj FCF (FY25)

$21.6B

Record | +15% YoY

Share Count

Declining

~2.5%/yr buyback | No dilution

Quarterly Net Revenue Trajectory ($M)

Quarter	24Q2	24Q3	24Q4	25Q1	25Q2	25Q3	25Q4	26Q1
Net Revenue	$8,900M	$9,617M	$9,510M	$9,594M	$10,172M	$10,724M	$10,901M	$11,230M
YoY (reported)	+9.6%	+11.7%	+10.1%	+9.3%	+14.3%	+11.5%	+14.6%	+17.1%
Constant-$ YoY (mgmt)	+12%	+11%	+11%	+14%	+11%	+13%	+13%	+16%

Revenue re-accelerating: constant-$ growth inflected from +11% to +16%. FQ2'26 net revenue of +17% reported / +16% cc is the fastest since 2022. The reacceleration is broad -- data processing and cross-border both inflected higher, and Value-Added Services (~30% of net revenue, +24-25% cc) plus CMS (+24% cc) are out-growing the core, mix-shifting the model toward higher-growth, higher-margin revenue.

Annual Financial Summary (FY ends September 30)

Metric	FY2021	FY2022	FY2023	FY2024	FY2025
Net Revenue ($M)	$24,105M	$29,310M	$32,653M	$35,926M	$40,000M
Rev YoY	—	+21.6%	+11.4%	+10.0%	+11.3%
Non-GAAP EPS ($)	$5.91	$7.50	$8.77	$10.05	$11.47
Non-GAAP EPS YoY	—	+26.9%	+16.9%	+14.6%	+14.1%
GAAP Op Margin	65.6%	64.2%	64.3%	65.7%	60.0%
Non-GAAP Net Income ($M)	$12,933M	$16,034M	$18,280M	$20,389M	$22,542M
Implied Diluted Shares (M)	2,187	2,137	2,086	2,029	1,966

Key trends

Revenue compounding at ~13% CAGR: From $24.1B (FY21) to $40.0B (FY25), with quarterly momentum now re-accelerating to +16-17% in FQ2'26 on cross-border, data processing, and VAS/CMS mix
Non-GAAP EPS compounding at ~18% CAGR: Four straight years of double-digit growth ($5.91 to $11.47), outpacing revenue on buybacks and margin
Best-in-class margins: GAAP operating margin holds a 60-66% band; the FY25 dip to 60.0% is a litigation-provision artifact, not structural, and FQ2'26 rebounded to 64.4%
Share count declining: Implied diluted shares fell from 2,187M (FY21) to 1,966M (FY25), ~2.5%/yr, buyback-driven with no dilution

Annual Revenue by Line ($M)

Revenue Line	FY2021	FY2022	FY2023	FY2024	FY2025
Service	$11,475M	$13,361M	$14,826M	$16,114M	$17,539M
Data Processing	$12,792M	$14,438M	$16,007M	$17,714M	$19,993M
International Transaction	$6,530M	$9,815M	$11,638M	$12,665M	$14,166M
Client Incentives (contra)	($8,367M)	($10,295M)	($12,297M)	($13,764M)	($15,751M)
Net Revenue	$24,105M	$29,310M	$32,653M	$35,926M	$40,000M

The two processing lines plus international (cross-border) are the core network toll; all three compound at double-digit rates. Client incentives are a growing contra-revenue cost of retaining issuer/co-brand relationships, but net revenue still compounds at ~13%.

Free Cash Flow ($M)

Metric	FY2021	FY2022	FY2023	FY2024	FY2025
Cash from Operations	$15,227M	$18,849M	$20,755M	$19,950M	$23,059M
Adjusted FCF	$14,522M	$17,879M	$19,696M	$18,693M	$21,577M
FCF YoY	—	+23.1%	+10.2%	-5.1%	+15.4%
FCF Margin	60.2%	61.0%	60.3%	52.0%	53.9%

FCF positive and growing -- record $21.6B in FY25 (+15%). Annual adjusted FCF runs a ~52-60% margin, funding a fresh $20B buyback ($9.2B returned in FQ2'26). The FY24 -5.1% dip and the noisy quarterly prints (a $2.6B / -40% FQ2'26 trough) are litigation-escrow, working-capital and tax timing -- not deterioration. Annual FCF is the cleaner signal and it is clearly rising.

Blemishes -- Not Operational Deterioration

Blemish	Detail	Penalty
FY25 GAAP Op-Margin Dip	GAAP op margin fell to 60.0% (from 65.7% FY24) on an elevated litigation provision in opex -- a one-time/legal item, not cost creep. Op income still grew; Non-GAAP margins held ~67%; FQ2'26 snapped back to 64.4%	None
Quarterly FCF Volatility	Quarterly adjusted FCF swings 23-77% margin; FQ2'26 trough of $2.6B (-40% YoY) is escrow/working-capital and tax timing. Annual FCF is positive and growing every year	None

Both blemishes are timing/legal, not operational. The FY25 margin dip is a litigation-provision artifact that reversed in FQ2'26; quarterly FCF lumpiness is escrow and tax timing. Operating income grew every year and hit a record $7,234M in FQ2'26. No penalty modifiers apply -- FCF is positive and growing, shares are declining, op income is rising, and debt is flat-to-down.

Score Rationale

Score of 8/10 reflects a high-quality compounder with improving top-line momentum. No penalty modifiers applied.

Supports 8/10:

Net revenue re-accelerating to +17% reported / +16% cc in FQ2'26 -- the fastest since 2022
Best-in-class 60-66% GAAP operating margins; FQ2'26 rebounded to 64.4%
Record adjusted FCF of $21.6B in FY25 (+15% YoY), ~55-60% FCF margins
Share count declining ~2.5%/yr, buyback-driven, no dilution
Four straight years of double-digit non-GAAP EPS growth ($5.91 to $11.47, ~18% CAGR)
VAS (~30% of net revenue, +24-25% cc) and CMS (+24% cc) mix-shifting toward higher-margin revenue

Acknowledged blemishes (no penalty):

FY25 GAAP op-margin dip to 60.0% -- litigation provision, not structural; reversed in FQ2'26
Quarterly FCF volatility -- escrow/working-capital/tax timing, not deterioration

Held back from a 10 only because margins are flat-to-modestly-expanding rather than a clean 100+bps annual expansion, and annual revenue growth has been steady ~11% rather than a multi-year acceleration.

Data sourced from Daloopa (company_id: 206). Fiscal year ends September 30. All financials in USD.