Shift4 Payments, Inc. (NYSE:FOUR) Q3 2023 Earnings Call Transcript

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Nancy Disman: Yes, I would think about Q4 as right now, our expectation going into the quarter, excluding the acquisitions, was certainly that Q4 would be a strong blended quarter. Q3 actually came in better than our initial expectations. So I expect Q4 to look similarly to what you saw in Q3. The 65 basis points, you heard us call it out as kind of a stabilizing of the spreads. Unfortunately, which ultimately ends up being a positive, is as we bring on large enterprise merchants quarter-to-quarter, there will be some movement. But I think if you use 65 as kind of an exit rate into Q4, you’d be at a good spot.

Jared Isaacman: And the one thing I want to call out, because we mentioned this in passing, but it’s an important consideration, is we do have to pay attention to exchange rates now with Finaro being a part of the business. So the impact on dollar versus euro is going to be something that can play a role. And obviously, there can be some volatility associated with that. But we’re not seeing any meaningful spread changes on a customer by customer, or vertical by vertical, or even geography by geography basis. It’s just another thing to keep in mind.

Jamie Friedman: Okay. And then for my follow-up, just to try and advance that conversation to 2024. So I realize we don’t have the revenue. We’ve got the volume and the guidance. But in terms of maybe qualitatively, how to think about the inputs for the blended spread for next year, because it sounds like you’re boarding a lot of enterprise activity. I mean, Jared was specific and articulate, enthusiastic about how much going on there. At the same time, Taylor, you’re saying you got international, which I would assume has a higher blended spread. So any way to think about the blended spread trends for next year will be helpful. Thank you.

Nancy Disman: Yes. And we’re really being careful to not go too far into giving anything on 2024 guide. We’ll talk, obviously, the next time we’re together about that in great detail. But I would just answer it similarly to the earlier question which is using 65 as kind of an exit rate right now from a modeling perspective is certainly reasonable. There will be puts and takes and exactly what you just summarized which is continuing going up market obviously comes at lower spreads but with all the international expansion that will be coming in at higher spreads. We also love what we’re seeing in our new verticals as we expand in S&E with ticketing which also brings that kind of vertical lines up from a spread perspective. So I think the blend that we’re at now if we’re putting a stake in the ground, but I would not take this as a guide point. I think 65 is a fairly stabilized blended spread right now for where the business is.

Jamie Friedman: Got it. Thank you. Thank you both.

Operator: Thank you. This will conclude today’s conference. You may disconnect your lines at this time, and thank you for your participation.

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