AvidXchange (AVDX -0.05%), a provider of automated accounts payable software and payment solutions to middle-market companies, reported its second quarter 2025 earnings on August 6, 2025. GAAP revenue for Q2 2025 was $110.6 million, just above the analyst estimate of $110.22 million (GAAP). Non-GAAP earnings per share landed at $0.05, while GAAP results swung to a loss of $9.5 million stemming from one-time merger expenses. Operational metrics like GAAP gross margin and transaction volume modestly improved, though overall customer and payment activity grew at a slow pace. With an impending acquisition by TPG and Corpay, AvidXchange management suspended financial guidance, leaving the outlook uncertain for the coming periods.
| Metric | Q2 2025 | Q2 2025 Estimate | Q2 2024 | Y/Y Change |
|---|---|---|---|---|
| EPS (Non-GAAP) | $0.05 | $0.06 | $0.05 | 0.0% |
| Revenue (GAAP) | $110.6 million | $110.22 million | $105.1 million | 5.2% |
| Non-GAAP Gross Profit | $81.6 million | $76.3 million | 6.9% | |
| Non-GAAP Gross Margin | 73.8% | 72.6% | 1.2 pp | |
| Adjusted EBITDA | $17.4 million | $17.5 million | (-0.6%) |
Source: Analyst estimates for the quarter provided by FactSet.
Company Overview and Core Business Activities
AvidXchange offers cloud-based software designed to automate invoice and payment processes for the middle market. Its main platform streamlines accounts payable workflows, enabling businesses to transition away from manual processes like paper checks. The software helps companies process bills, manage supplier networks, and make secure payments more efficiently.
The company’s growth hinges on expanding the volume of payment transactions and onboarding new customers in underpenetrated markets. It serves over 8,500 business buyers and 1.35 million suppliers. Success depends on enlarging its network, deepening relationships, and integrating with diverse software partners. The company’s key focus areas are increasing transaction yield, expanding market reach, and adapting to changes in the broader economy, such as shifts in interest rates and middle-market demand.
Quarterly Highlights: Financial and Product Progress
GAAP revenue rose 5.2% from the prior year. Revenue slightly exceeded consensus estimates. Total transactions processed increased 1.8% to 20.1 million, and payment volume advanced 4.1% to $21.5 billion. The average yield per transaction improved 3.2% to $5.50.
Profitability metrics were mixed. Non-GAAP gross margin improved to 73.8%, up from 72.6% in Q2 2024. Adjusted EBITDA was $17.4 million compared with $17.5 million in the prior year. On the downside, sharp increases in operating expenses weighed on the bottom line. Sales and marketing expenses (GAAP) rose 15% to $23.1 million compared to Q2 2024. Research and development expenses increased 8% to $27.0 million compared to Q2 2024. General and administrative expenses were $33.5 million (GAAP), including $6.4 million in merger-related costs, compared to $22.6 million in Q2 2024. As a result, GAAP net results flipped from a minor profit to a notable loss.
Interest income (GAAP), which reflects the earnings from holding customer funds and investments, fell 10.2% to $10.6 million compared to Q2 2024. The company reported that operational cash flow improved for the first half of 2025, providing some balance to the higher expense load, and marketable securities (GAAP) increased to $71.5 million as of June 30, 2025, more than doubling since December 2024.
No major product launches or new integrations were reported. The platform continued to offer end-to-end software and payment solutions, aiming to digitize and automate accounts payable for its sizable customer base. The company also continued its focus on maintaining compliance amid a complex regulatory landscape. There were no announced dividends and no declared changes to payout policy or trend. AVDX does not currently pay a dividend.
Looking Ahead: Guidance and Key Watch Points
The company suspended its previously issued financial outlook for fiscal 2025, citing its pending acquisition by TPG in partnership with Corpay. Management also opted not to hold an earnings call for this period. As a result, there is no formal financial guidance for the remainder of the year, leaving investors without visibility into future revenue or earnings trends.
With the business in a transition phase and operational transparency reduced, investors will likely focus on how the merger progresses and its impact on core metrics like customer count, payment volume, expense control, and cash flow. The swing to a GAAP net loss and flat non-GAAP net income, together with higher expenses and muted customer expansion, are important areas to monitor in future earnings announcements or acquisition updates.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
