Paymentus (PAY) Oppenheimer 27th Virtual Annual Technology, Internet & Communications Conference summary

Market opportunity and business model

• Operates in a large, growing market focused on essential household bills, with significant untapped potential and strong operating leverage.

• Services non-discretionary sectors, making the business resilient to economic downturns and recessions.

• Revenue model is transaction-based, avoiding license and implementation fees, which appeals to billing companies seeking efficiency and cost savings.

• Platform enables consolidation of disparate systems, offering a unified solution for billing companies.

• Historical growth persisted through past recessions, the pandemic, and inflationary periods.

Financial performance and targets

• Targets annual revenue growth of 20%+ and Adjusted EBITDA growth of 20–30%, with historical CAGRs above 25%.

• Strong backlog and pipeline across all biller sizes and verticals, with improving trends in recent quarters.

• Same-store sales growth is the largest driver, supported by digitalization and long-term contracts averaging around five years.

• High operating leverage due to a single platform for all verticals, resulting in strong margins and cash generation.

• Confident in meeting 2024 guidance and maintaining long-term growth cadence into 2025.

Competitive landscape and differentiation

• Displaces both legacy providers and in-house solutions, with a focus on simplifying bill payments through innovation.

• Main competitors include large conglomerates like FIS and Fiserv.

• Differentiated by a modern, unified technology platform, broad payment channels, and proprietary Instant Payment Network.

• Platform is vertical-agnostic, allowing entry into new sectors without versioning issues.