Nayax Q3 Earnings Call Highlights

Key Points

• Q3 revenue rose 23% to $128 million and adjusted EBITDA increased 32.9% to $24.2 million; gross margin hit a company-record 49.6%. Nayax posted a $1.1 million net loss, citing higher financial expenses and stock-based compensation.
• Recurring revenue grew 21% and reached about 73% of total revenue, while adjusted operating expenses fell by more than $4 million from Q2. Transaction value rose 26% to $2.2 billion.
• Nayax reaffirmed 2026 guidance of $510 million–$520 million in revenue excluding IPS, and forecasts $530 million–$540 million including IPS. The company is integrating its $350 million IPS acquisition, which is expected to contribute about $20 million in Q4 revenue.

Nayax NASDAQ: NYAX reported 23% revenue growth and record gross margin in the third quarter of 2026, as the payments technology company expanded its recurring business and reduced adjusted operating expenses.

Revenue rose to $128 million from $104 million a year earlier, while adjusted EBITDA increased 32.9% to $24.2 million, or 19% of revenue. The company reported a net loss of $1.1 million, compared with net income of $3.5 million a year earlier, which Chief Financial Officer Sagit Manor attributed to higher financial expenses and stock-based compensation.

Management reaffirmed its full-year outlook excluding the recently acquired IPS Group and added the parking company’s expected fourth-quarter contribution to its forecast. Nayax now expects 2026 revenue of $530 million to $540 million and adjusted EBITDA of approximately $90 million to $95 million, including IPS.

Recurring Revenue and Margins Improve

Recurring revenue increased 21% and accounted for approximately 73% of total revenue, up from roughly 62% in the first quarter of 2023, according to Co-Founder and Chief Executive Officer Yair Nechmad. The company ended the quarter with nearly 1.6 million managed and connected devices and approximately 131,000 customers globally.

Total transaction value rose 26% to $2.2 billion. Average revenue per unit increased 11% year over year to $255, which Manor attributed to the conversion of machines from cash to cashless payments and expansion into higher-value markets including electric vehicle charging, amusement and car washes.

Overall gross margin reached 49.6%, a company record. Recurring gross margin improved to 54.8% from 53.6% a year earlier, while processing margin rose to 41.6% from 39.6% and software-as-a-service margin increased to 77.3% from 76.3%.

Hardware revenue grew 27% to $34.5 million, driven primarily by expansion of the EV platform. Hardware gross margin improved to 35.2% from 28.1% in the second quarter, helped by higher average selling prices and lower costs for the VPOS Media product family.

Adjusted operating expenses fell by more than $4 million from the second quarter to $40 million. Manor said cost reductions included employee-related, marketing and information technology expenses. Adjusted net income rose to $14.1 million from $10.2 million a year earlier.

IPS Integration and Expansion Plans

Nayax completed its $350 million acquisition of IPS Group on Oct. 1, giving it a foothold in smart parking. Nechmad said IPS serves more than 250,000 parking spaces and that Nayax expects to begin converting IPS payment volume to its processing platform and introduce the business to continental Europe over the next 12 months.

Chief Strategy Officer Aaron Greenberg said approximately $500 million in cashless volume already flows through IPS, which historically has not acted as the payment facilitator. Nayax is working on an integration that it believes could increase processing revenue and margins, though Greenberg said it would take some months to see payment throughput.

Greenberg also said Nayax does not intend to make another large acquisition soon and is focused on integrating IPS and reducing leverage. The company remains open to smaller acquisitions that add services, strengthen its offerings in particular industries or expand its presence in selected regions, he said.

Outside parking, Nechmad highlighted a distribution partnership with Getnet intended to expand Nayax’s reach in Latin America, starting with Chile, followed by Brazil, Mexico and Argentina. A separate agreement with Allied Electronics is expected to bring Nayax’s VPOS Media 5 payment devices to U.S. fuel pumps in the coming months.

In EV charging, Nechmad said a network of 2,000 chargers moved onto the company’s platform using Lynkwell software. Greenberg said EV revenue remains below 10% of company revenue, although it has been growing quickly.

Full-Year Outlook and Cash Flow

Nayax reaffirmed its 2026 revenue guidance of $510 million to $520 million excluding IPS, including organic growth of 22% to 25%. It expects IPS to contribute approximately $20 million of revenue and $5 million of adjusted EBITDA in the fourth quarter.

Manor said the fourth quarter is seasonally the strongest for Nayax’s core business. She cited orders in hand and a tracked pipeline in EV charging, fuel and retail as support for the outlook. The company also expects to deliver more than 10,000 units ordered by a Southeast Asian amusement operator in the third quarter.

Nayax generated $18.1 million in operating cash flow and $10 million in free cash flow during the third quarter. For the full year, it continues to expect free cash flow conversion of approximately 5% to 10% of adjusted EBITDA, excluding IPS, as it invests in financial services, EV charging deployments and component sourcing.

Manor said Nayax has provided approximately $12 million in short-term operating investments for Lynkwell charging deployments since the beginning of the year, including approximately $5 million in the third quarter. Some deployments are funded ahead of customer payments, including payments made after customers receive government grants.

Looking further ahead, Manor reiterated the company’s goal of a 30% adjusted EBITDA margin in 2028. She said a 2027 margin between 26% and 28% would be consistent with that trajectory, while stressing that the company had not provided formal 2027 guidance.

About Nayax (NASDAQ:NYAX)

Nayax Ltd. is a financial technology and commerce platform company focused on unattended and self-service retail. Its offerings combine cashless payment processing with business management and consumer-engagement tools. The company provides payment devices and software that support cashless transactions, remote monitoring, sales reporting and loyalty programs. Its solutions serve operators in markets such as vending, self-service laundries, micro markets and other unattended retail settings. Founded in 2005 and headquartered in Israel, Nayax serves merchants and operators in markets around the world.

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