Usio Sees ACH Records, Education Payments and Ion Platform Fueling Profit Growth

Key Points

• Usio’s ACH business is accelerating: Volume rose 34% year over year in the first half of 2026, with the third quarter marking another record and gross margins around 70%. Education payments, including student refunds and school-voucher programs, are key growth opportunities.
• New platforms could improve profitability: Usio Ion may generate interest income from $80 million-$100 million already held in its ecosystem, with potential access to an additional $300 million in deposits. The Usio One integration initiative is also intended to improve operating leverage and cross-selling.
• Financial performance strengthened: First-half revenue increased 17% to more than $49 million, adjusted EBITDA rose 65%, and Usio posted positive net income versus a prior-year loss. The company raised its full-year revenue-growth outlook to 14%-16% and expects a new Harris Computer partnership to expand its government and utility customer base.

Usio NASDAQ: USIO executives outlined growth across its payment-processing businesses, highlighted new opportunities in education and government payments, and pointed to operating leverage and its Usio Ion platform as potential drivers of profitability.

Chief Executive Officer Louis Hoch described Usio as a fintech payment processor supporting multiple payment methods, ranging from printed checks to ACH, real-time payments and card-based transactions. The company operates four complementary business lines: payment facilitation, ACH processing, card issuing and Output Solutions, its print-and-mail operation.

Hoch said the company works with large enterprises, pharmaceutical companies and more than 200 U.S. cities and counties. He cited Los Angeles County as an example of a customer using all four of Usio’s business lines. The county uses Usio for mailed notices containing payment QR codes, payment processing for fees and fines, check disbursements and 13 active card programs.

Payment Facilitation and ACH Growth

In payment facilitation, Usio processes credit and debit card transactions for integrated software vendors rather than selling directly to individual merchants. Hoch said the company shares roughly half of the revenue generated from payments with its software partners. He cited PracticeSuite, whose software is used by 20,000 doctors’ offices, as an example of an integrated software customer.

Hoch said ACH processing volume rose 34% year over year during the first six months of 2026. The company’s ACH business carries a 70% gross margin, according to Hoch, and the third quarter set an all-time record for ACH volume. He said each of the previous six quarters had also produced record ACH volumes.

Asked about the drivers of ACH growth, Hoch said Usio has added sales and gained traction in student-payment distributions, much of which is delivered through ACH. He said ACH remains an economical way to send money, while the company is also positioned to support shifts toward real-time payments.

“We have every payment channel, so it doesn’t matter how the market shifts,” Hoch said. “If we see a shift from ACH to real-time payments, we’re going to be there.”

Card Programs and Education Opportunities

Chief Accounting Officer Michael White said Usio’s card-issuing division primarily distributes prepaid Mastercard products through government agencies and nonprofit programs. Spending on prepaid cards issued by Usio totaled just under $115 million in the first half of 2026, up 9% from a year earlier.

White acknowledged that the business has faced difficult comparisons due to one-time programs and the loss of an end customer served through a reseller. However, he highlighted education-related opportunities, including state school-voucher programs and Title IV student refunds.

Through a partner, Usio currently processes 37 state school-voucher programs that accounted for $1.3 billion in payments over the previous 12 months, White said. Five of those programs currently use cards, while the rest use ACH. One additional state program involving more than $1 billion is in implementation, he added.

For university student refunds, Usio’s consumer-choice platform allows recipients to select ACH, prepaid cards, digital-wallet delivery, pinless debit, real-time payments or checks. White said the flexibility can be applied across universities, nonprofits and government clients.

Output Solutions, Ion and Harris Partnership

Usio’s Output Solutions division, acquired in 2020, prints and mails recurring statements, invoices, government notices and other documents. In the first half of 2026, printed-and-mailed volume increased 36% while electronic-document activity rose 45%, White said.

The company launched an internal integration initiative called Usio One at the beginning of 2025, consolidating sales, customer support, information technology and finance functions across the business lines. White said the effort is intended to improve operating leverage and increase cross-selling.

White also discussed Usio Ion, a business-banking platform acquired in November 2025. The platform is designed to allow payment customers to settle funds into a Usio-managed wallet rather than an external bank account. Usio currently has between $80 million and $100 million of funds in its ecosystem at a given time and believes Ion could provide access to another $300 million in deposits, according to White.

“That revenue goes straight to the bottom line,” White said of interest earned on funds held in the ecosystem.

Separately, Usio recently announced a partnership with Harris Computer, a Constellation Software subsidiary. Under the arrangement, Usio will serve as a preferred payments provider for Harris’ utility and government software customers, offering payment processing and print-and-mail services. White said implementation may take time because government and utility customers can move slowly, but he characterized the opportunity as potentially meaningful.

Financial Results and Outlook

For the first six months of 2026, Usio reported revenue of more than $49 million, up 17% year over year. Gross profit increased 9%, adjusted EBITDA rose 65%, and the company reported positive net income of $400,000 compared with a $600,000 loss in the prior-year period.

As of June 30, Usio had $6.5 million in cash and what White described as essentially no debt, aside from equipment financing related to its Output Solutions printing operation.

The company raised its full-year revenue-growth guidance after its second-quarter results and now expects growth of 14% to 16%, compared with its initial outlook of 10% to 12%.

Hoch said the company’s technology platform is already built, limiting the need for substantial incremental selling, general and administrative expenses as processing volume grows. He said additional costs could include customer-service staff and cloud-server capacity, but characterized those as relatively modest compared with the company’s volume opportunity.

About Usio (NASDAQ:USIO)

Usio, Inc is a financial technology company that provides electronic payment and money-movement services to businesses, government agencies, financial institutions and other organizations. The company supports the acceptance and processing of credit and debit card payments, automated clearing house (ACH) transactions and electronic bill payments through its payment technology platform.

Usio also offers prepaid card and disbursement solutions, including services that can be used for payroll, incentives, refunds, healthcare payments and other controlled payment programs.

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