Paysafe (NYSE:PSFE) Posts Quarterly Earnings Results, Misses Estimates By $0.11 EPS

Key Points

• Paysafe reported quarterly EPS of $0.44, missing the $0.55 consensus estimate by $0.11; revenue of $439.57 million also fell short of expectations.
• Revenue grew just 1% year over year, while adjusted EBITDA declined 17% and margin fell to 24%. Management cited market and regulatory pressures and expects headwinds to weigh more heavily in Q4.
• There were pockets of growth: active users increased 14% to 8.1 million, and Merchant Solutions revenue rose 2%, supported by iGaming and direct SMB sales—but management said these gains are not yet enough to offset broader pressures.

Paysafe (NYSE:PSFE - Get Free Report) posted its earnings results on Thursday. The company reported $0.44 EPS for the quarter, missing analysts' consensus estimates of $0.55 by ($0.11), FiscalAI reports. Paysafe had a negative net margin of 11.82% and a positive return on equity of 10.31%. The business had revenue of $439.57 million for the quarter, compared to analyst estimates of $448.53 million. Paysafe updated its FY 2026 guidance to 1.450-1.540 EPS.

Here are the key takeaways from Paysafe's conference call:

• Q3 revenue rose just 1% year over year, while Adjusted EBITDA fell 17% and margin declined to 24%. The company cited tougher regulatory and market conditions, unfavorable foreign exchange, weaker-than-expected sales ramp-up, and higher expenses; a $203 million goodwill impairment contributed to a GAAP net loss but was non-cash.
• Paysafe lowered its full-year outlook to approximately 4% revenue growth, with management expecting headwinds to weigh more heavily in Q4, particularly in digital wallets, crypto, and financial trading. Executives said it remains unclear how much of the pressure will extend into 2027.
• Three-month active users grew 14% to 8.1 million, and newer products showed strong growth: PaysafeWallet rose more than 30%, PagoEfectivo’s wallet user base grew more than 40%, and video gaming grew over 20%. Management cautioned that these initiatives are not yet large enough to offset headwinds, and digital-wallet ARPU declined 10% amid mix shifts.
• Merchant Solutions revenue increased 2%, with double-digit growth in iGaming and direct SMB sales; combined direct and agent-channel revenue grew 8%, supported by a 17% year-to-date increase in active agents. Management expects SMB to maintain a mid-single-digit growth profile, while non-gaming e-commerce remains more challenged.
• Net leverage was 5.5x at quarter-end and is expected to remain around that level at year-end, partly reflecting refinancing costs and a $39 million litigation payment. Management said it is targeting roughly half a turn of deleveraging annually over the next two to three years, supported by free cash flow and efforts to release cash tied up in working capital and banking arrangements.

Paysafe Price Performance

Shares of PSFE traded down $2.94 during mid-day trading on Thursday, hitting $3.88. 3,170,031 shares of the company were exchanged, compared to its average volume of 406,000. The company has a debt-to-equity ratio of 4.38, a quick ratio of 1.17 and a current ratio of 1.17. Paysafe has a 1-year low of $3.81 and a 1-year high of $10.04. The stock has a market cap of $200.26 million, a price-to-earnings ratio of 5.78 and a beta of 1.80. The company has a 50 day moving average of $6.06 and a 200-day moving average of $7.09.

Insider Buying and Selling

In other Paysafe news, insider Richard Swales sold 10,000 shares of the stock in a transaction that occurred on Friday, August 14th. The stock was sold at an average price of $6.58, for a total transaction of $65,800.00. Following the completion of the transaction, the insider owned 34,456 shares of the company's stock, valued at $226,720.48. This represents a 22.49% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available through this hyperlink.

Analysts Set New Price Targets

A number of equities analysts have issued reports on PSFE shares. BTIG Research lowered their price target on Paysafe from $12.00 to $11.00 and set a "buy" rating on the stock in a research report on Wednesday, July 29th. UBS Group set a $7.00 price objective on Paysafe and gave the company a "sell" rating in a research report on Friday, August 14th. Susquehanna set a $7.00 target price on Paysafe and gave the stock a "neutral" rating in a research note on Wednesday, August 12th. Weiss Ratings reiterated a "sell (d-)" rating on shares of Paysafe in a research report on Wednesday, November 4th. Finally, Zacks Research lowered Paysafe from a "hold" rating to a "strong sell" rating in a research report on Wednesday, July 15th. One analyst has rated the stock with a Buy rating, two have issued a Hold rating and three have issued a Sell rating to the stock. Based on data from MarketBeat, the stock presently has a consensus rating of "Reduce" and a consensus price target of $8.50.

Paysafe Company Profile

Paysafe Limited is a payments technology company that provides services to businesses and consumers. Its offerings include payment processing and merchant solutions, digital wallets, and prepaid payment products designed for online and in-person transactions. The company's consumer brands include Skrill and NETELLER digital wallets and paysafecard, a prepaid option that lets customers pay online without using a traditional payment card. Paysafe also supports merchants with tools for accepting and managing payments across digital channels.

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