Corpay CPAY · USD

SegmentsThe Company reports information about its operating segments in accordance with the authoritative guidance related to segments. We manage and report our operating results through three reportable segments: Vehicle Payments, Corporate Payments (includes aggregation with cross-border operating segment), Lodging Payments and an Other category (which combines Gift and Payroll Card operating segments). These reportable segments align with how the Company's Chief Executive Officer, who is the Chief Operating Decision Maker (CODM), allocates resources, assesses performance and reviews financial information. The CODM uses segment operating income to make decisions regarding the allocation of resources (including financial resources and capital spending) to each segment primarily in the annual budget and forecasting process and reviews budget to actual variances for segment operating income on a monthly, quarterly and annual basis to assess the performance of each segment.

RevenueThe Company provides payment solutions to our business, merchant, consumer and payment network customers. Our payment solutions are primarily focused on specific spend categories, including Vehicle Payments, Corporate Payments, Lodging Payments and Other. The Company provides solutions that help businesses of all sizes control, simplify and secure payment of various domestic and cross-border payables using specialized payment products. The Company also provides other payment solutions for fleet maintenance, employee benefits and long-haul transportation-related services. Payment ServicesThe Company’s primary performance obligation for the majority of its payment solutions (Vehicle Payments, Corporate Payments, Lodging Payments and Other) is to stand-ready to provide authorization and processing services (payment services) for an unknown or unspecified quantity of transactions and the consideration received is contingent upon the customer’s use (e.g., number of transactions submitted and processed) of the related payment services. Accordingly, the total transaction price is variable. Payment services involve a series of distinct daily services that are substantially the same, with the same pattern of transfer to the customer. As a result, the Company directly allocates and recognizes variable consideration in the period it has the contractual right to invoice the customer. Similarly, for the toll product within Vehicle Payments, the Company's primary performance obligation is to stand-ready each month to provide access to the toll network and process toll transactions. Each period of access is determined to be distinct and substantially the same as the customer benefits over the period of access. The Company records revenue for its payment services net of (i) the cost of the underlying products and services; (ii) assessments and other fees charged by the credit and debit payment networks (along with any rebates provided by them); (iii) customer rebates and other discounts; and (iv) taxes assessed (e.g., VAT and VAT-like taxes) by a government, imposed concurrent with a revenue-producing transaction. Variability arising from rebates is generally resolved and/or reset within the reporting period to which the variable consideration is allocated.

Commitments and ContingenciesIn the ordinary course of business, the Company and its subsidiaries (collectively, the "Company") is involved in various pending or threatened legal actions, arbitration proceedings, claims, subpoenas and matters relating to compliance with laws and regulations (collectively, "legal proceedings"). Based on our current knowledge, management presently does not believe that the liabilities arising from these legal proceedings will have a material adverse effect on our consolidated financial condition, results of operations or cash flows. However, it is possible that the ultimate resolution of these legal proceedings could have a material adverse effect on our results of operations and financial condition for any particular period.FTC MatterIn October 2017, the Federal Trade Commission (FTC) issued a Notice of Civil Investigative Demand to the Company for the production of documentation and a request for responses to written interrogatories. After discussions with the Company, the FTC proposed in October 2019 to resolve potential claims relating to the Company’s advertising and marketing practices, principally in its U.S. direct fuel card business within its North American fuel card business. The parties reached impasse primarily related to what the Company believed were unreasonable demands for redress made by the FTC. On December 20, 2019, the FTC filed a lawsuit in the Northern District of Georgia against the Company and Ron Clarke. See FTC v. FleetCor Technologies, Inc., No. 19-cv-05727 (N.D. Ga.). The complaint alleged the Company and Ron Clarke violated the FTC Act’s prohibitions on unfair and deceptive acts and practices. The complaint sought among other things injunctive relief, consumer redress and costs of suit. On April 17, 2021, the FTC filed a motion for summary judgment. On April 22, 2021, the United States Supreme Court held unanimously in AMG Capital Management v. FTC that the FTC does not have authority under current law to seek monetary redress by means of Section 13(b) of the FTC Act, which is the means by which the FTC has sought such redress in this case. The Company cross-moved for summary judgment regarding the FTC’s ability to seek monetary or injunctive relief on May 17, 2021.

DebtCredit Agreement and Securitization FacilityThe Company’s debt instruments at December 31 consist primarily of term notes, revolving lines of credit and a Securitization Facility as follows (in thousands):20252024Term Loan A note payable (a), net of discounts$2,918,787$3,083,037Term Loan B note payable (a), net of discounts3,934,4032,327,174Revolving line of credit facilities (a)1,325,0001,262,000Other obligations (c)497869Total notes payable, credit agreements and other obligations8,178,6876,673,080Securitization Facility (b)1,823,0001,323,000Total debt$10,001,687$7,996,080Current portion$3,345,530$2,769,974Long-term portion6,656,1575,226,106Total debt$10,001,687$7,996,080_____________________(a)The Company is party to a $10.15 billion Credit Agreement (the "Credit Agreement"), with Bank of America, N.A., as administrative agent, swing line lender and letter of credit issuer and a syndicate of financial institutions (the "Lenders"), which has been amended multiple times. The Credit Agreement provides for senior secured credit facilities (collectively, the "Credit Facility") consisting of a revolving credit facility in the amount of $2.8 billion, a Term Loan A facility in the amount of $3.3 billion and a Term Loan B facility in the amount of $4.1 billion, consisting of a $3.15 billion Term Loan B-5 and a $0.9 million Term Loan B-6, as of December 31, 2025. The revolving credit facility consists of (a) a revolving A credit facility in the amount of $1.3 billion with sublimits for letters of credit and swing line loans and (b) a revolving B facility in the amount of $1.5 billion with borrowings in U.S. dollars, euros, British pounds, Japanese yen or other currency as agreed in advance and sublimits for swing line loans. The Credit Agreement also includes an accordion feature for borrowing an additional $750 million in Term Loan A, Term Loan B, revolving A or revolving B facility debt and an unlimited amount when the leverage ratio on a pro-forma basis is less than 3.75 to 1.00. Proceeds from the credit facilities may be used for working capital purposes, acquisitions and other general corporate purposes. The maturity date for the Term Loan A and revolving credit facilities A and B is June 24, 2027. The Term Loan B-5 has a maturity date of April 30, 2028, and the Term Loan B-6 has a maturity date of November 5, 2032. On May 3, 2023, the Company entered into the thirteenth amendment to the Credit Facility.

Income TaxesIncome before the provision for income taxes is attributable to the following jurisdictions for years ended December 31 (in thousands):202520242023United States$289,052$278,330$322,856Foreign1,252,6271,106,7831,002,149Total$1,541,679$1,385,113$1,325,005The provision for income taxes for the years ended December 31 consists of the following (in thousands): 202520242023Current:Federal$102,328$168,982$155,647State22,2457,52825,614Foreign373,062269,588208,532Total current497,635446,098389,793Deferred:Federal(40,323)(62,190)(46,676)State4,414(19,080)(8,088)Foreign8,00516,5538,086Total deferred(27,904)(64,717)(46,678)Total provision$469,731$381,381$343,115For the year ended December 31, 2025, the Company adopted ASU 2023-09 on a prospective basis. In preparing the tabular rate reconciliation, the Company presented the effects of cross-border tax laws net of U.S. tax credits. The tax effects for all jurisdictions of changes in judgment related to tax positions taken in prior annual reporting periods, and associated interest, are reported in the changes in unrecognized tax benefits category. The provision for income taxes differs from amounts computed by applying the U.S. federal statutory rate of 21% to income before income taxes for the year ended December 31, 2025, in accordance with guidance after the adoption of ASU 2023-09, due to the following (in thousands, except percentages*):2025U.S. federal tax at statutory rate$323,75321.0%State and local income taxes, net of federal income tax effect21,0611.4Foreign tax effects:Australia:Gain (loss) on sale30,5172.0Other14,8401.0Brazil:Statutory tax rate difference between Brazil and U.S.47,1433.1Withholding taxes17,4161.1Other(24,700)(1.6)Canada16,3361.1Other foreign jurisdictions5,6540.4Effect of cross-border tax laws17,0971.1Changes in unrecognized tax benefits19,7761.3Other adjustments(19,160)(1.2)Effective tax rate$469,73130.5%*Columns may not calculate due to rounding.The provision for income taxes differs from amounts computed by applying the U.S. federal tax rate of 21% for both 2024 and 2023, to income before income taxes for the years ended December 31, 2024 and 2023, in accordance with guidance prior to the adoption of ASU 2023-09, due to the following (in thousands, except percentages): 20242023Computed “expected” tax expense$290,87721.0%$278,25121.0%Changes resulting from:Change in valuation allowance(64,289)(4.6)22,4471.7Foreign tax credits1,3090.1(98,641)(7.

Stock-Based CompensationThe Company accounts for stock-based compensation pursuant to relevant authoritative guidance, which requires measurement of compensation cost for all stock awards at fair value on the date of grant and recognition of compensation, net of forfeitures, over the requisite service period for awards expected to vest.The Company has a Stock Incentive Plan (the "Plan"), pursuant to which the Company's Board is permitted to grant equity to employees and directors. Under the Plan, a maximum of 20.65 million shares of the Company's common stock is approved to be issued for grants of restricted stock and stock options.The table below summarizes the expense recognized within general and administrative expenses in the Consolidated Statements of Income related to stock-based compensation for the years ended December 31 (in thousands): 202520242023Stock options$30,959$30,822$24,342Restricted stock71,67885,90291,744Stock-based compensation$102,637$116,724$116,086The tax benefits related to stock-based compensation, inclusive of the tax benefits upon the exercises of options and vesting of restricted stock were $38.1 million, $60.7 million and $22.1 million for the years ended December 31, 2025, 2024 and 2023, respectively.The following table summarizes the Company’s total unrecognized compensation cost related to outstanding stock awards as of December 31, 2025 (cost in thousands): UnrecognizedCompensationCostWeighted AveragePeriod of ExpenseRecognition Remaining(in Years)Stock options$50,3541.65Restricted stock36,8770.58Total$87,231Stock OptionsThe following summarizes the changes in the number of shares of stock options outstanding for the following periods (shares and aggregate intrinsic value in thousands): SharesWeightedAverageExercisePriceOptionsExercisableat End ofYearWeightedAverageExercisePrice ofExercisableOptionsWeightedAverage FairValue ofOptionsGranted Duringthe YearAggregateIntrinsicValueOutstanding at December 31, 20225,301$188.123,512$159.46$113,681Granted411222.51$66.28Exercised(648)172.0140,983Forfeited(81)241.78Outstanding at December 31, 20234,983192.183,182163.54451,039Granted169285.11$97.38Exercised(2,271)188.61324,577Forfeited(397)253.49Outstanding at December 31, 20242,484191.971,760171.95364,092Granted598325.28$84.88Exercised(432)155.6986,899Forfeited(57)240.35Outstanding at December 31, 20252,593$227.701,551$185.93$206,036Expected to vest at December 31, 20251,042$289.

LeasesThe Company primarily leases office space, data centers, vehicles and equipment. Some of the Company's leases contain variable lease payments, typically payments based on an index. The Company’s leases have remaining lease terms of one year to thirty years, some of which include options to extend from one to five years or more. The exercise of lease renewal options is typically at the Company's sole discretion; therefore, the majority of renewals to extend the lease terms are not reasonably certain to exercise and are not included in Right of Use (ROU) assets and lease liabilities. Variable lease payments based on an index or rate are initially measured using the index or rate in effect at lease commencement. Additional payments based on the change in an index or rate are recorded as a period expense when incurred. Lease modifications result in remeasurement of the lease liability as of the modification date. Other assets include ROU assets, other current liabilities include short-term operating lease liabilities and other non-current liabilities include long-term lease liabilities at December 31, 2025 and 2024 as follows (in thousands): 20252024ROU assets$99,641$77,998Short term lease liabilities$29,237$24,340Long term lease liabilities$85,288$64,718The Company does not recognize ROU assets and lease liabilities for short-term leases that have a term of twelve months or less. The effect of short-term leases were not material to the ROU assets and lease liabilities.Under ASC 842, the Company discounts future lease obligations by the rate implicit in the contract, unless the rate cannot be readily determined. As most of our leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the lease commencement date in determining the present value of the lease payments. In determining the borrowing rate, the Company considers the applicable lease terms, the Company's cost of borrowing and for leases denominated in a foreign currency, the collateralized borrowing rate that the Company would obtain to borrow in the same currency in which the lease is denominated. Total lease costs for the years ended December 31, 2025, 2024 and 2023 were $28.0 million, $26.9 million and $29.7 million, respectively. Variable lease costs and short-term lease costs were immaterial for all periods presented.

Acquisitions and Investments2025 AcquisitionsGringo AcquisitionIn February 2025, the Company acquired 100% of Gringo, a leading Brazil-based vehicle registration and compliance payment company, for approximately $153.7 million, net of cash and cash equivalents acquired of approximately $10.2 million. Immediately prior to the acquisition, the Company infused capital equal to the purchase price into Zapay, one of the Company's less than wholly owned subsidiaries, in order for Zapay to complete the acquisition of Gringo. As a result of the capital infusion by the Company, the Company's controlling interest in Zapay increased to approximately 86%. This transaction, which was accounted for separately from the business acquisition, was recorded as an equity transaction. The Company financed the acquisition using available cash. Results from the Gringo acquisition have been included in the Company's Vehicle Payments segment from the date of acquisition. The Gringo acquisition was accounted for as a business combination. The related acquisition accounting is preliminary as the Company is still completing the valuation of intangible assets, income taxes, working capital, and contingencies. None of the goodwill attributable to the acquisition of Gringo is expected to be deductible for tax purposes. Noncompete agreements signed in conjunction with this acquisition were accounted for separately from the business acquisition. There were no material measurement period adjustments recorded during the year ended December 31, 2025 related to the Gringo acquisition.The following table summarizes the preliminary acquisition accounting for the Gringo acquisition noted above (in thousands):Trade and other receivables$8,591Prepaid expenses and other current assets4,284Other long term assets847Goodwill129,885Intangibles24,270Accounts payable(1,370)Other current liabilities(5,036)Other noncurrent liabilities(8,557)Total consideration paid$152,914The estimated fair value of intangible assets acquired and the related estimated useful lives consisted of the following (in thousands):Useful Lives (in Years)ValueTrade names and trademarks - indefinite livedN/A$13,457Proprietary technology53,360Customer and vendor relationships2 to 207,453$24,270Alpha AcquisitionIn July 2025, the Company announced, pursuant to Rule 2.