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Date

Tuesday, May 12, 2026 at 5 p.m. ET

Call participants

  • President and Chief Executive Officer — Mark R. Newcomer
  • Chief Financial Officer — Jeffery Baker
  • President, Patient Affordability — Matthew Turner
  • Chief Payments Officer — Matthew Lanford

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Takeaways

  • Revenue -- $28 million, a 50.8% increase, surpassing the high end of prior guidance.
  • Net income -- $5.4 million, up 110% year over year.
  • Adjusted EBITDA (excluding stock-based compensation) -- $10.6 million, representing 113.4% year-over-year growth.
  • Operating margin -- 23.8%, rising over 1,000 basis points year over year and above the 20%-22% guided range.
  • Patient affordability revenue -- $15.7 million, an 82% increase, with claim volume up approximately 49%.
  • Financial assistance delivered (patient affordability) -- More than $540 million in the quarter, up from $320 million the previous year.
  • Active patient affordability programs -- 141 as of the call, versus 135 at quarter end; on track for 147-150 by next quarter.
  • New programs launched -- Four new patient affordability programs launched during the quarter, bringing active program count to 135 at quarter end.
  • Plasma revenue -- $11.7 million, a 25% increase; average monthly revenue per center rose to $6.7 thousand from $6.5 thousand.
  • Plasma center count -- 573 as of quarter end, 22 fewer than the prior year, with a reduction mainly due to the sale or closure of low-performing centers not using Paysign services.
  • Gross profit margin -- Expanded to 65% from 62.9%, reflecting a greater pharma revenue mix.
  • Cost of revenues -- Up 42.2%, but well below revenue growth, due to increased call center, processing, and commission expenses.
  • Total operating expenses -- $11.6 million, up 25.5%, also below revenue growth rate.
  • Selling, general, and administrative expenses -- $8.9 million, a 20.5% rise, including $1.3 million of stock-based compensation.
  • Depreciation and amortization -- Increased $0.84 million, primarily from Gamma acquisition amortization and capitalized software costs.
  • Income before taxes -- $7.5 million, up from $3.3 million in the prior year.
  • Effective tax rate -- 27.2%, compared to 20.5% in the previous year, due to discrete stock-based compensation adjustments from share price increases.
  • Adjusted EBITDA margin -- 37.8%, up from 26.7% last year.
  • Fully diluted share count -- 61 million, up from 55.1 million a year ago.
  • Unrestricted cash -- $20.5 million and zero bank debt at quarter end.
  • Restricted cash -- $159 million, a $15 million increase, driven by higher customer deposits and funds on card.
  • Full-year revenue guidance -- $106.5 million-$110.5 million, projecting 30%-35% growth.
  • Gross profit margin guidance -- 60%-62% for the full year.
  • Net income guidance -- $13 million-$16 million, or $0.21-$0.26 per diluted share.
  • Adjusted EBITDA guidance -- $30 million-$33 million, or $0.49-$0.53 per diluted share.
  • Expected plasma center count -- 555-560 in the next quarter, reflecting the closure of 19 low-performing centers in May.
  • Seasonality -- Pharma revenue expected to peak in Q1 and moderate, while plasma revenue is forecasted to build throughout the year post-tax season.
  • Platform capabilities -- CEO Mark R. Newcomer said, "Do not see any other peers that are out there that have built anything like we have built."

Summary

The call underscores a strong inflection point for Paysign (PAYS 0.26%) with the first-time shift of pharma surpassing plasma as the largest revenue segment, highlighting strategic execution. Management communicated that revenue conversion to operating income improved materially, as approximately $9.4 million in incremental revenue yielded $4.2 million in incremental operating income. The company cited real-time business wins during the industry’s top specialty summit, translating to a pipeline on track to beat last year's net program adds—roughly half attributable to new clients and half to growth from existing ones.

  • Management confirmed no expected financial impact from the closure of 19 plasma centers, as affected cardholders are anticipated to migrate to proximate locations.
  • Patient affordability programs delivered nearly a full prior-year’s revenue within a single quarter, evidencing a rapid acceleration in both client ramp and dollar volumes processed.
  • Plasma average loads per center rose on a year-over-year basis "for the first time since the industry experienced an inventory correction that began in 2024".
  • Matthew Turner affirmed the existing systems’ capability, stating no additional capital or IT build-out is needed to support expected program growth this year or beyond.
  • Next quarter’s patient affordability active program count is projected at 147-150, and plasma center count at 555-560, with guidance fully incorporating anticipated seasonal and structural shifts.

Industry glossary

  • Patient affordability programs: Pharma-backed initiatives enabling patients to manage or lower out-of-pocket costs for prescribed therapies, often via copay assistance and affordability benefits managed through third-party platforms.
  • Plasmapheresis: A process by which plasma is collected from donors using specialized hardware in plasma centers, a key component of the plasma donor compensation business referenced in the call.
  • Copay maximizer/accumulator programs: Health insurance policies or pharmacy benefit manager strategies affecting how drug manufacturer assistance is applied to patient deductibles and copays, referenced as influencing client and platform demand.

Full Conference Call Transcript

Mark R. Newcomer: Thank you, Kevin. Good afternoon, everyone, and thank you for joining us today for PaySign's first quarter 26 earnings call. I am Mark R. Newcomer, president and chief executive officer. Joining me today is Jeffery Baker, our chief financial officer. Also on the call are Matthew Turner, president of patient affordability, and Matthew Lanford, our chief payments officer. Both of whom will be available for Q&A following our prepared remarks. Earlier today, we announced our first quarter financial results. Which marked the strongest start to a year in PaySign's history. Revenue grew 50.8% to $28 million, exceeding the high end of guidance we provided in Mark.

Net income increased 110% to $5.4 million and adjusted EBITDA increased 113% to $10.6 million Most notably, operating margins increased 1.04 thousand basis points or 10.4 percentage points year over year demonstrating the operating leverage inherent in our business as we scale across health care and financial ecosystems. We continue to see strong growth across the patient affordability business in the first quarter. Revenue grew 82% year over year to $15.7 million, and claim volume was approximately 49% higher than Q1 25, driven by a combination of new programs launched over the past year, organic growth within the existing programs, the continued ramp of our largest pharmaceutical clients.

As expected, this rate reflects a larger and more established revenue base than a year ago. In Q1 alone, patient affordability generated nearly as much revenue as it did in 2025. During the quarter, our patient affordability business delivered more than $540 million in financial assistance to patients. A meaningful step up from approximately $320 million in the first quarter of last year. That growth reflects both the increased number of patients we are serving and the expanding role our business plays in supporting access to high cost branded therapies. Our dynamic business rules technology continues to deliver substantial economic value to our pharmaceutical clients and the patients that rely upon their therapy.

Demonstrating both the scale our platform now operates at and the differentiated value our technology provides in helping manufacturers navigate Copay Maximizer, and accumulator programs. We launched 4 new programs in the first quarter bringing total active programs to 135. As is typical for the industry, Q1 is the most operationally constrained period of the year as manufacturers, payers and pharmacy partners work through plan year transitions, formulary changes, and deductible resets. Against that backdrop, our pipeline remains robust and we are on track to exceed the 55 net program additions we launched in 2025.

Strength of that pipeline reflects the trust pharmaceutical manufacturers continue to place in PaySign as a partner in helping patients access and afford the therapies they need. Taken together, the increase we are seeing in program count claim volume and benefit dollars deployed reinforce both the scalability of our platform and the durability of demand for our solutions. Last month, we attended the Assembia Specialty Pharmacy Summit, ASX26, in Las Vegas. Asembia is the most important annual gathering in the specialty pharmaceutical industry and consistently 1 of the most productive pipeline generating events on our calendar. It is where the decision makers across pharmaceutical manufacturers, specialty pharmacies, hub providers, and payer partners come together in 1 place.

And the conversations we had during those 3 days helped shape our commercial road map for the balance of the year. ASX 26 was no exception. We conducted more than 50 meetings over 3 days and closed new business while on-site. The breadth and depth of these conversations combined with the deals we secured in real time reinforce our confidence in both the demand environment and the strength of our pipeline heading into the remainder of 2026. Turning to our plasma donor compensation business, In the first quarter, plasma contributed $11.7 million in revenue. A 25% increase over $9.4 million in Q1 25. Our plasma business also remains a strong source of cash generation, facilitating investments in high opportunity areas.

Looking ahead, we expect continued revenue growth as existing centers fill excess capacity much of which has been unlocked by recent advances in plasmapheresis hardware. Bringing significant efficiencies to the plasmapheresis process. In response to that capacity gain several of our larger collectors have consolidated operations closing some lower performing centers. Historically, these closures have had minimal impact on our results as donors typically transition to nearby centers. And we expect that same pattern to play out following our clients' closure of 19 centers in early May. We exited the quarter with 573 centers an increase of 89 centers over the previous year. But 22 less than 2025.

As several low performing centers were either sold to collectors that do not utilize our services or closed. Again, we do not believe these closings will negatively affect our growth outlook, and we continue to pursue the remaining plasma collection companies that we do not currently service. In late April, we sponsored the International Plasma Protein Congress in Milan, Italy, where we engaged with plasma collectors, device manufacturers, and industry participants from The US Europe and Asia. The conference generated meaningful progress for our Software-as-a-Service suite of solutions, including the discussions with plasma collection companies across all 3 regions and with plasmapheresis device manufacturers regarding direct integration to our platform.

Direct integration of our software with plasmapheresis device eliminates manual steps that can introduce human error in the collection process. It also streamlines implementation and reduces friction for collection centers when transitioning to our platform. Creating a clear operational benefit. Beyond The US, we continue to view Europe and Asia as significant long term opportunities for our SaaS solutions across the blood and plasma collection industries. In summary, the first quarter marked an outstanding start to 2026. And a meaningful inflection point for PaySign. We delivered record results across the business and more importantly validated strategic direction we have set. Purpose built platforms grounded in deep industry expertise, scaling with discipline as we grow.

With strong momentum in patient affordability, a robust pipeline, and expanding opportunities both within and beyond health care, are well positioned to drive sustained growth and create long term value for shareholders, customers, and the individuals we ultimately serve. With that, I will turn it over to Jeffery for additional details on our first quarter financial results.

Jeffery Baker: Thank you, Mark. Good afternoon, everyone. As Mark highlighted, our first quarter results reflect the continued momentum in our business the growing financial impact of our patient affordability platform and the inflection point we have reached as it relates to operating leverage. For the first quarter, total revenues increased 50.8% year over year to $28 million Pharma industry revenue increased 81.9% year over year to $15.7 million. Driven by 45 net pharma patient affordability programs launched during the past 12 months and a corresponding increase in monthly management fees, setup fees, claim processing fees, other billable services such as dynamic business rules and customer service contact center support. Process claims increased by approximately 49% compared to 2025.

For the first time, pharma surpassed plasma to become our largest revenue contributor in the quarter. A milestone that reflects the strategic direction we have been executing against and the growing importance patient affordability plays in our business. Plasma revenue increased 24.9% year over year to $11.7 million The average monthly revenue per center increased to $6.67 thousand versus $6.52 thousand and the average number of loads per center increased on a year over year for the first time since the industry experienced an inventory correction that began in 2024. As Mark noted, we exited the quarter with 573 centers below our guidance of 589 as 1 customer notified us they had sold all their centers to a competing provider.

These centers contributed approximately $650 thousand in 2025 revenue and averaged less than $3.5 thousand per month in revenue, which is below the corporate average of $6.67 thousand. Gross profit margin expanded to 65% from 62.9% in 2025, reflecting a greater mix of pharma revenue which carries higher gross margins than our plasma business. Cost of revenues increased 42.2% driven mainly by increased call center support expense associated with the growth in both our plasma and pharma businesses and higher processing and commission costs, all of which grew well below our revenue growth of 50.8%. Demonstrating the operating leverage inherent in our business. Total operating expenses were $11.6 million an increase of 25.5% from $9.2 million in 2025.

Again, well below our revenue growth rate. Selling, general, and administrative expenses increased 20.5% to $8.9 million, which includes stock-based compensation of $1.3 million. Depreciation and amortization increased $835 thousand due primarily to the amortization of intangible assets from our Gamma acquisition and capitalization of new software development costs. A highlight of the quarter is overall operating leverage amidst strong revenue growth. Operating margin expanded to 23.8% from 13.4% in 2025, an improvement of over a thousand basis points. Put another way, we converted approximately $9.4 million in incremental revenue into $4.2 million in operating income. Here are a few other important details for the quarter. Income before taxes increased to $7.5 million from $3.3 million in 2025.

The company recorded an income tax provision of $2 million resulting in an effective tax rate of 27.2%. Compared to 20.5% in 2025. The higher rate reflects discrete item adjustments primarily related to the increase in our stock price at 3/31/2026 compared to the same period last year, which reduced the tax benefit from stock based compensation relative to the prior year period. Net income for the quarter totaled $5.4 million or $0.09 per fully diluted share, an increase from $2.6 million or $0.05 per fully diluted share in the first quarter 25.

Adjusted EBITDA, which excludes stock-based compensation, and is used by management to evaluate core operating performance, increased 113.4% to $10.6 million or $0.17 per fully diluted share versus $5 million or $0.09 per fully diluted share in 2025. Adjusted EBITDA margin expanded to 37.8% from 26.7% a year ago. The fully diluted share count used in calculating per share amounts was 61.0 million versus 55.1 million in the prior year period. We exited the quarter with $20.5 million in unrestricted cash and zero bank debt. Restricted cash increased $15 million to $159 million primarily related to customer program deposits for our plasma and pharma customers and an increase in funds on card. Now turning to our outlook.

Our first quarter results exceeded our guidance across every line of the income statement. Revenue of $28 million exceeded the high end of our 27 to $27.5 million guidance range. Operating margin of 23.8%, finished above our guided range of 20 to 22% and net margin of 19.4% exceeded the top of our 17 to 19% range. Based on our strong start to the year, we are increasingly confident in our ability to achieve the upper end of our 2026 guidance ranges. We continue to expect full year revenue of $106.5 million to $110.5 million representing 30 to 35% year over year growth. With gross profit margins between 60% to 62%.

Net income is expected to be in the range of $13 million to $16 million or $0.21 to $0.26 per diluted share, and adjusted EBITDA is expected to be in the range of $30 million to $33 million or $0.49 to $0.53 per diluted share. As of today, we have 141 active patient affordability programs and expect to exit the quarter with 147 to 150 active programs. Also expect our active plasma center count to decline to 555 to 560 centers as a customer closed 19 underperforming centers in May. As in the past, we do not expect any financial impact from these closures as we expect cardholders from these underperforming centers to transition to other centers.

As a reminder, there is seasonality in both our main businesses. Pharma revenues are typically highest in the first quarter as patient affordability claims peak with annual insurance deductible resets and then moderate throughout the balance of the year. Plasma revenues, by contrast, tend to be softest in the first quarter and build through the remainder of the year as donor activity normalize following tax refund season. These seasonal dynamics are anticipated and fully reflected in our full year guidance. Overall, our first quarter results validate the financial framework we laid out, and the operating leverage we are generating gives us confidence in our ability to continue delivering on the forecast we have outlined for 2026.

With that, I would like to turn the call back over to Kevin for questions and answers.

Operator: Thank you. We will now be conducting a question and answer session. If you would like to before pressing star 1. Our first question is coming from Jacob Stephan from Lake Street Capital Markets. Your line is now live.

Analyst (Jacob Stavant): Yes. Hey, guys. Appreciate you taking the questions. Congrats on a nice quarter here. Mark, you made a comment that in the beginning of the call, you said you expect to exceed 55 net program adds that you did in 2025. I guess for starters, what is kind of driving the confidence in the strength in the pipeline Is there 1 is there a 1-time event out there that you are seeing? Or is this mostly and that maybe is a part b. Is this mostly newer existing customers that are additive in the back half of the year?

Matthew Turner: Hey. This is Matthew Turner. So I think if you were to look at what the pipeline looks right now, there is a pretty good mix probably around 50/50 when you look at the program count, you know, that we are talking about now, like, you know, going over 55. Half are gonna be entirely new clients and the other half are going to be growth inside of existing clients. I do not think it is any you know, there is not 1 moment of inflection point Last time we are on the call, we talked about kind of what inning were we in.

And I think, you know, this is showing that what we built on know, in the first inning, right, is coming true now. So we have got a larger client base. We are going to continue to see the new programs from those clients. And then also selling never stops. So, we are always trying to bring new, clients onto the platform.

Analyst (Jacob Stavant): Got it. And I mean, if I am running the numbers, that kind of implies like, 190 programs exiting 2026. I guess from a capacity standpoint, you know, you guys feel like you have the extra bandwidth? I guess, what is needed to fully add those programs?

Matthew Turner: I do not think there is anything else needed. I mean, we will continue to hire people to support the business even on the account management side. From an IT perspective, the systems are robust and well positioned to handle growth that we have this year and any years coming. So we have built systems that are high availability, high demand, the partners that we have in the space are all used to higher claim volumes like this. So we are confident we have everything in place that we need to continue to scale the growth year after year.

Analyst (Jacob Stavant): Got it. And then maybe if we could just touch on, the some of the guidance commentary. I know you guys said you expect revenue to be roughly equal Looking at kind of the, you know, the plasma centers, obviously, you are expecting a decline in Q2 here. I think that implies a pretty significant ramp in the back half for plasma revenue. If I am catching that right.

Jeffery Baker: No. I we revenue for plasma should be up sequentially and continue to grow throughout the rest of the year. So the centers that we called out for the quarter that were sold were garbage centers, to be quite honest with you. And they were below our corporate averages. And then the centers that were consolidated or shut down, that company has other centers within the proximity of the ones that they close. So what is going to happen is those cardholders are just going to move over. But we have you know, there are some there I put some comments out there to give you kind of a heads up.

I mean, we saw average loads per center up for the first time since 2024 on a year over year basis. So we talk about the inventory overhang that we experienced all throughout 2025. And we are seeing early indications that we are through that. Now what you are seeing is some of the plasma companies trying to become more efficient. They are closing underperforming centers. We have run the numbers on those centers. They should have closed them a long time ago to be honest with you, but the matter of fact that we have gone through this before, pretty much every year, and it does not impact the number.

So we expect plasma to continue to grow throughout the year. And hold to that 50/50 mix right now as we see it. Subject to change as we move forward.

Analyst (Jacob Stavant): Okay. Appreciate the color, guys. Congrats again. Thanks, Jacob.

Operator: Thank you. Next question is coming from Gary Prestopino from Barrington Research. Your line is now live.

Analyst (Gary Prestopino): Hey, good afternoon, everyone. Jeffery, you guys were throwing around a lot of numbers here. I want to make sure that I have got this right. By your press release, you say you have a 135 pharma programs right now. Correct?

Jeffery Baker: No. Part of the press release for the quarter, we exited the quarter with 135 programs. As I sit here today, at 05:20, we have 141 active programs. By the end of the end of the second quarter, I have told you that we will have between 147 to 150. Active programs.

Analyst (Gary Prestopino): Okay. that is what I was, confused about. And then for the plasma, you got 573, and you are gonna be between 550 and 560.

Jeffery Baker: Right. We were at 573 million at the end of the quarter. And then we had a customer notify us that they were shutting centers on May 5th, 19 centers and then I have said that we expect it in the second quarter between 555 and 560 as we have some other new centers opening in the pipeline.

Analyst (Gary Prestopino): Okay. that is helpful. I just want to make sure I got that right. So you talked a little bit Mark, about your plasma platform.

Mark R. Newcomer: And how you are integrating into these providers. What are the competitive advantages to an entity integrating into the platform, number 1? How does that work in conjunction with the app that you have developed? And then are there any other players out there that have a platform with your technological capabilities? If we look at our entire ecosystem of what we built, the platform with the various modules of the app the CRM, the qualitative analysis, and everything else.

Do not see any other peers that are out there that have built anything like we have built. it is kind of you know, some of the, you know, some of the feedback we have gotten from you know, the various conferences we have gone to is a game changer. It, you know, the fact that all of the pieces of the software can communicate together and feed off 1 another is definitely a step up.

Analyst (Gary Prestopino): From what folks have had. So, you know, if you look at it from, you know, from a plasma center perspective, it provides less friction for what they have currently and allows for a center to really not only have less friction, but just more ease of use in how they interact with the donors engagement, all the way through.

Mark R. Newcomer: So it really, you know, it is really about less friction and just better capabilities.

Analyst (Gary Prestopino): Okay. Thank you. And then just a couple just a couple more, and I will jump off. I believe 1 of the individuals, and I forgot your name on this, is that you are talking about the pharma programs and about 50% are takeaways and 50% are new programs. Is that about