NYAX — Nayax Ltd.

Summary of Nayax (NYAX) Q4 2025 Earnings Call

1. Key Financial Results and Metrics

• Net Income: Achieved $35.5 million, a significant turnaround from a loss in the previous year, marking the company's first profitable year.
• Total Revenue: Reached $400 million, representing a 28% year-over-year growth, with approximately 24% organic growth.
• Recurring Revenue: Constituted 72% of total revenue, growing 29% to about $287 million.
• Gross Margin: Improved to 48.2% from 45.1%, driven by enhanced processing economics and operational efficiencies.
• Adjusted EBITDA: Increased to $61.1 million, or 15.3% of revenue.
• Installed Base: Expanded to approximately 1.46 million connected devices, adding over 200,000 devices in 2025.
• Average Revenue Per Unit (ARPU): Increased to approximately $239, up 11% year-over-year.

2. Strategic Updates and Business Highlights

• Acquisitions: Completed five strategic acquisitions in 2025, including Lynkwell and UpPay, enhancing geographic reach and technological capabilities.
• Vertical Expansion: Focused on automated self-service across 40 verticals, with significant growth in EV charging, amusement, and car washes.
• Product Launches: Introduced the VPOS Media device, enhancing customer engagement through a screen-based experience.
• Geographic Focus: Expanded operations into new markets, particularly in Latin America and Asia, with a dedicated focus on Japan.
• Operational Efficiency: Aiming to increase revenue per employee to $1 million through resource optimization and AI integration.

3. Forward Guidance and Outlook

• 2026 Revenue Guidance: Expected to be between $510 million and $520 million, reflecting organic growth of 22% to 25%.
• Adjusted EBITDA Margin: Projected around 17%, translating to $85 million to $90 million.
• Free Cash Flow: Anticipated conversion of approximately 40% of adjusted EBITDA, a significant improvement from 2025.
• Net Revenue Retention Rate: Expected to remain around 120%, with 75-80% of growth coming from existing customers.

4. Bad News, Challenges, or Points of Concern

• Free Cash Flow: Came in lower than guidance at approximately $12 million, impacted by working capital investments and increased accounts receivable.
• Take Rate Volatility: Experienced fluctuations in take rates, which may affect revenue predictability.
• Dependence on Acquisitions: Future growth heavily relies on successful integration of acquisitions and expansion into new verticals.

5. Notable Q&A Insights

• Hardware Deployments: Strong Q4 hardware sales are expected to drive future recurring revenue growth, particularly in EV charging and other verticals.
• Gross Margin Outlook: Anticipated to remain high, with expectations of reaching or exceeding 50% in the long term.
• Acquisition Strategy: Management confirmed intentions to pursue 2-3 acquisitions annually, leveraging a robust cash position of over $300 million.
• Revenue Mix: Higher-value verticals like EV charging are growing faster than traditional vending, indicating a shift in revenue composition.
• Embedded Financial Services: Plans to expand Nayax Capital's offerings, including deposit accounts and lending, to enhance ARPU from existing customers.

Overall, Nayax demonstrated strong financial performance in 2025, with a focus on strategic growth through acquisitions and expansion into new markets and verticals. The outlook for 2026 remains positive, though challenges related to cash flow and market dynamics persist.