Usio NASDAQ: USIO reported second-quarter fiscal 2026 revenue growth of 19% and its second consecutive quarter of positive GAAP net income, while raising its full-year revenue growth outlook.
Senior Vice President and Chief Accounting Officer Michael White said the company met or exceeded analyst expectations for revenue and earnings. Revenue growth accelerated from 15% in the first quarter, while business-unit growth excluding interest income approached 20%, he said.
Usio reported net income of $280,000, or $0.01 per share, and adjusted EBITDA of $1.1 million, more than double the year-earlier quarter. Gross profit dollars rose 12%, and selling, general and administrative expenses declined by about $190,000 from a year earlier despite the increase in revenue.
“This marks our second consecutive quarter of positive GAAP net income, an important milestone,” White said, adding that the quarter’s net income came from core operations and did not include unusual or one-time items.
Total payment dollars processed increased 27% from a year earlier, while payment transactions also rose 27%. White said no customer represented more than 10% of total revenue and that a majority of revenue remained recurring.
Card and ACH businesses post growth
Greg Carter, executive vice president of Payment Acceptance and chief revenue officer, said Card revenue increased 28% year over year to $9 million, marking the segment’s best second-quarter revenue performance. Card processing dollars rose 13%, while transactions increased 19%.
The performance was led by the company’s payment facilitator, or PayFac, business, where revenue increased 43%. PayFac accounted for more than three-quarters of Card revenue, according to Carter.
Merchant count increased 34% during the first six months of the year. Carter described the PayFac model as a “flywheel” in which Usio adds independent software vendors, or ISVs, whose subscriber and merchant bases then grow over time.
“New ISVs, ISV growth, and then merchant growth within that community” are the components of that growth model, Carter said during the question-and-answer session.
Chairman and CEO Louis Hoch said revenue in Usio’s ACH business, its most profitable unit, increased 21%. ACH transactions grew 34%, payment dollar volume rose 28%, and return-check processing increased 35%. July set a monthly ACH transaction record, he said.
Hoch also said the company had grown its real-time payments, or RTP, customer base to 12 accounts from none a year ago. Some customers have shifted volume from PINless debit to RTP, which produces less revenue per transaction but carries higher margins, according to Hoch.
Card Issuing, education programs and Output Solutions
Card Issuing experienced what Hoch called an “improved quarter” despite continuing revenue headwinds. Purchase volume increased 11%, while card loads were flat and transactions declined slightly. The company signed 16 new issuing clients during the quarter and had more than 20 clients either in implementation or scaling volumes.
Management highlighted school voucher programs and university loan-refund distributions as prospective issuing growth opportunities. Hoch said Usio expects to serve school voucher programs in approximately five or six states, up from two states discussed previously. The programs represent roughly $1.5 billion in total expected volume, he said.
One state is expected to disburse about $1.2 billion, according to management. While initial voucher-program distributions have largely moved through ACH, Hoch said the programs provide opportunities for multiple channels on Usio’s platform.
The company also expects to begin distributing Title IV university loan-payment refunds for several universities through a fintech partner in the second half. That partner currently serves 30 universities through another processor, and Usio believes it could transition those programs over time.
Output Solutions revenue rose 22% in the second quarter, accelerating from 19% growth in the first quarter. Pieces processed and mailed increased 43%, while electronic documents processed and delivered grew 49%.
Hoch said Output Solutions set monthly revenue records in each month of the first half and signed 11 new contracts while renewing two existing agreements. The business installed a new high-speed printer that is about four times faster than existing equipment and provides four times the resolution. Management expects the equipment to reduce labor, maintenance and ink costs while expanding the company’s ability to produce higher-quality print work.
Ion rollout and guidance increase
Usio is developing Usio Ion, the new name for PostCredit, which Hoch said is designed to sit across the company’s divisions. The platform has been beta tested by a handful of customers, and management said feedback has been positive.
Hoch said Ion could create revenue through card spending, accelerated settlement fees and, primarily, float income from customer funds held on the platform. He said the company currently has between $80 million and $100 million held on behalf of others at a given time, and management believes Ion could potentially support more than $200 million of daily balances.
Management said Ion’s fuller launch will be a key factor in lifting gross margins beyond the company’s stated near-term range of 23% to 25%. Usio also expects improved pricing from sponsoring banks beginning in the third quarter as processing volumes increase.
For fiscal 2026, Usio raised its revenue growth guidance to 14% to 16%, from its prior expectation of 10% to 12%. The company also expects to continue generating positive adjusted EBITDA.
Cash and cash equivalents totaled $6.4 million at quarter-end. White said the decline from the start of the year primarily reflected the timing of annual cash outlays, stock repurchases and investments in strategic initiatives, including Ion. During the first six months of 2026, Usio repurchased 281,000 shares for approximately $371,000.
About Usio (NASDAQ:USIO)
Usio, Inc NASDAQ: USIO is a financial technology company that delivers integrated payment, transaction processing, and money services solutions. The company's platform combines merchant acquiring, multi‐rail payment enablement and business management tools to support merchants, financial institutions and business partners in automating and securing electronic and cash‐based transactions.
Through its subsidiaries, Usio provides a broad range of products and services, including point-of-sale terminals, payment gateway services, automated teller machine (ATM) processing, bill payment, money order issuance, domestic and international money transfer and remittance solutions.
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