‘We Are Just Beginning’ Says Shift4’s CEO As He Reviews a Strong Quarter

Shift4 Payments Inc. early Thursday reported a 26% jump year-over-year in September-quarter processing volume as the company continues to deploy assets acquired in its $2.5-billion deal for the Swiss processor Global Blue.

“We are number one in hotels, number one in stadiums, and we are just beginning to bring these strengths to the world,” noted chief executive Taylor Lauber during a conference call held to discuss Shift4’s quarterly results, which include a 62% surge in gross profit to $409.6 million for the quarter, matching the company’s four-year compound annual growth rate in the category.

Results like that are helping to fuel expansion at Shift4 as the Center Valley, Pa.-based company prepares to absorb early next year the U.S. and Canadian assets of the French processor Worldline S.A., collectively known as Bambora North America. That deal, expected to close in the first quarter next year, will bring to Shift4 one of the largest processors of automated clearing house volume in the U.S. market, Lauber said.

Now, Lauber said, Shift4 looks to execute on a two-pronged strategy, characterized by enterprise merchants served by Global Blue at one end of the spectrum and by its bread-and-butter small-and-medium-size sellers at the other. “We put our chips where we think the verticals are going to be the strongest,” Lauber said. “It’s going well across the board.” Still, the company’s original strategic focus hasn’t blurred with the Global Blue deal, he added. “What we’re really good at is getting the mom-and-pop store a point of sale,” he said. “That’s really good and really hard to leave.”

At the same time, Lauber defended Shift4’s recent action to support its stock, which he said is “trading at levels we were trading at in December 2020. The obvious thing to do is to buy as much of our equity as we’re permitted to do. We’re excited to deploy capital on such an obvious basis.” And, he hinted, Shift4 is far from pulling back on its acquisition strategy. “These dollars aren’t coming at the expense of a missed M&A opportunity,” he said. The company’s shares were trading at just shy of $70 early Thursday.

The absorption of Global Blue and the Bambora deal come as the company’s largest shareholder, founder and former CEO Jared Isaacman, is set after some delay to take over the National Aeronautics and Space Administration. President Trump originally nominated Isaacman for that role early this year but withdrew the nomination in May after disclosures that Isaacman had donated to Democratic candidates. The reversal of that decision came Nov. 4.

But Isaacman has left Lauber in a strong position that shows few signs of weakening. Revenue for the quarter, at $589.2 million, was up 61% year-over-year, fueling that surge in gross profit as the company leverages its longstanding positions in the hospitality and stadium markets. “We put our chips where we think the verticals are going to be strongest,” Lauber told analysts on Thursday’s call.