News Release

• Total revenue of $263.6 million
• Net loss of $(48.2) million
• Net cash provided from operations of $56.4 million
• Entered into a seven-year contract extension with Avis Budget Group, Inc.
• Entered into a five-year contract extension with Hertz
• Revising fiscal year 2026 guidance

MESA, Ariz., Aug. 5, 2026 /PRNewswire/ -- Verra Mobility Corporation (NASDAQ: VRRM), a leading provider of smart mobility technology solutions, announced today the financial results for the second quarter ended June 30, 2026.

"I am proud of what our team accomplished during the second quarter, delivering revenue and profitability above our internal expectations while continuing to execute well across the business," said Jon Keyser, Interim Chief Executive Officer of Verra Mobility. "During the quarter, we also retained two of our most important customer relationships by extending our long-standing agreements with Avis Budget Group and Hertz. These agreements, together with our selection by the City of Los Angeles to implement California's largest speed safety program, reflect the strength of our technology, our operational capabilities and the trust our customers place in Verra Mobility."

"This has been a transformative quarter for our company. On behalf of our leadership team, I want to sincerely thank our employees for embracing change, acting with urgency and re-centering our focus on customer success. Their commitment is helping build a more agile, customer-centric Verra Mobility and positions us for long-term value creation."

Second Quarter 2026 Financial Highlights

• Revenue: Total revenue for the second quarter of 2026 was $263.6 million, an increase of 12% compared to $236.0 million for the second quarter of 2025. Service revenue growth was 10%, driven by 17% growth in our Government Solutions segment and 6% growth in our Commercial Services segment. Government Solutions service revenue growth was driven primarily by a $12.0 million increase in New York City revenues associated with new camera installations, net of pricing changes under the new contract. The remaining $5.1 million in growth is attributable to expansion in bus lane, speed and other services. The increase in Commercial Services revenue was due to increased product adoption and tolling activity compared to the prior year which contributed to a $4.1 million growth in rental car companies ("RACs") tolling revenue, with the remainder primarily driven by higher violations processing. Parking Solutions service revenue increased by $0.2 million compared to the second quarter of 2025, as increased revenue from our software as a service ("SaaS") product offerings was partially offset by decreases in subscription services and professional services revenue related to parking management solutions.
• Net (loss) income and Diluted Earnings Per Share ("EPS"): Net loss for the second quarter of 2026 was $(48.2) million, or $(0.32) per share, based on 151.9 million diluted weighted average shares outstanding. Net income for the comparable 2025 period was $38.6 million, or $0.24 per share, based on 161.5 million diluted weighted average shares outstanding. The decrease in net income for the second quarter of 2026 was primarily due to impairments on goodwill and intangible assets recorded for the three months ended June 30, 2026 and an increase in operating expenses, partially offset by margins on product sales and installation services and a decrease in selling, general and administrative expenses.
• Adjusted EPS*: Adjusted EPS for the second quarter of 2026 was $0.38 per share compared to $0.34 per share for the second quarter of 2025.
• Adjusted EBITDA*: Adjusted EBITDA was $110.7 million for the second quarter of 2026 compared to $105.3 million for the same period in 2025. Adjusted EBITDA Margin* was 42% and 45% of total revenue for the 2026 and 2025 periods, respectively.
• Net Cash Provided from Operations: Cash provided by operating activities decreased by $18.7 million from $75.1 million for the three months ended June 30, 2025 to $56.4 million for the three months ended June 30, 2026. Net (loss) income quarter-over-quarter decreased by $86.8 million, from $38.6 million in 2025 to $(48.2) million in 2026. The aggregate adjustments to reconcile net (loss) income to net cash provided by operating activities increased $94.3 million mainly due to the impairments on goodwill and intangible assets recorded for the current period, a prior period uncertain tax position reserve release and the mark-to-market adjustment on the share-based proceeds, partially offset by decreases in stock-based compensation, deferred income taxes and credit loss expense. The aggregate changes in operating assets and liabilities decreased by $26.3 million in 2026 compared to the prior year period and were primarily due to an increase in the net use of working capital, of which the majority was attributable to an increase in accounts receivable, unbilled receivables and inventory, partially offset by an increase in accounts payable.
• Free Cash Flow*: Free Cash Flow was $32.6 million for the second quarter of 2026 compared to $40.3 million for the prior year period. The decline in Free Cash Flow is attributable to the items impacting cash provided by operating activities (as discussed above), partially offset by a reduction in capital expenditures.

*Non-GAAP measure; refer to "Non-GAAP Financial Measures" further below for explanatory notes and a reconciliation to the most directly comparable GAAP measure.

We report our results of operations based on three operating segments:

• Commercial Services offers automated toll and violations management and title and registration solutions to rental car companies, fleet management companies and other large fleet owners.
• Government Solutions delivers automated safety solutions to municipalities, school districts and government agencies, including services and technology that enable photo enforcement cameras to detect and process traffic violations related to speed, red-light, school bus and city bus lane management.
• Parking Solutions provides an integrated suite of parking software, transaction processing and hardware solutions to universities, municipalities, parking operators, healthcare facilities and transportation hubs in the United States and Canada.

Second Quarter 2026 Segment Detail

• The Commercial Services segment generated total revenue of $115.1 million, a 6% increase compared to $109.1 million in the same period in 2025. Segment profit was $77.2 million, a 7% increase from $72.0 million in the prior year period. The increases in revenue and segment profit compared to the prior year period resulted from increased product adoption and tolling activity compared to the prior year which contributed to a $4.1 million growth in RAC tolling revenue, with the remainder primarily driven by higher violations processing. The segment profit margin was 67% for the second quarter of 2026 and 66% for the second quarter of 2025. Second quarter 2026 segment profit margins benefitted from lower credit loss expense.
• The Government Solutions segment generated total revenue of $128.5 million, a 20% increase compared to $107.1 million in the same period in 2025. The increase was due to a 17% increase in service revenue over the prior year period, primarily driven by a $12.0 million increase in New York City revenues associated with new camera installations, net of pricing changes under the new contract. The remaining $5.1 million in growth was attributable to an expansion in bus lane and speed camera-related revenue and other services. In addition, product revenue increased approximately $4.3 million from the prior year period. The segment profit was $31.2 million in 2026 compared to $30.1 million in the prior year period with segment profit margins of 24% for 2026 and 28% for 2025. The decline in segment profit margins compared to the prior year period was primarily driven by increased costs to support project implementations and the pricing change under the New York City contract.
• The Parking Solutions segment generated total revenue of $20.0 million, a 1% increase compared to $19.9 million in the same period in 2025, which was due primarily to an increase in SaaS product offerings, partially offset by decreases in subscription services and professional services revenue related to parking management solutions compared to the prior year period. The segment profit was $2.3 million compared to $3.2 million in the prior year period with segment profit margins of 11% for 2026 and 16% for 2025.

Liquidity and Debt: As of June 30, 2026, cash and cash equivalents were $49.6 million and total debt, net was $1,035 million. Net cash provided by operating activities was $56.4 million for the three months ended June 30, 2026, and $97.2 million for the six months ended June 30, 2026.

Net Debt and Net Leverage*: As of June 30, 2026, Net Debt was $993.2 million and Net Leverage was 2.4x, as compared to $971.8 million and 2.3x as of December 31, 2025.

*Non-GAAP measure; refer to "Non-GAAP Financial Measures" further below for explanatory notes and a reconciliation to the most directly comparable GAAP measure.

Change in Executive Leadership and Organizational Realignment

On June 1, 2026, we announced that David Roberts had departed as our President and Chief Executive Officer and as a member of our Board of Directors. The Board appointed Jon Keyser, previously our Chief Transformation Officer and Executive Vice President and Chief Legal Officer, as Interim President and Chief Executive Officer and retained an executive search firm to assist with a comprehensive search for a permanent successor.

On June 17, 2026, we announced organizational changes intended to accelerate our transformation initiatives, strengthen customer focus and create a more agile and efficient operating model. These changes are intended to build upon a hybrid operating model that centralizes key functions, including Human Resources, Finance, Legal, Government Relations, Engineering and Product Management. Stacey Moser was appointed Chief Customer Officer with responsibility for sales, account management and marketing across our Commercial Services and Government Solutions businesses. We are evaluating the effect of these organizational and internal management reporting changes on our operating and reportable segments.

Commercial Services Customer Contracts

We announced that one of our three significant Commercial Services customers had issued a notice terminating its contract with us; that customer subsequently withdrew and rescinded the notice and instead entered into a seven-year contract extension on terms materially less favorable to us than the prior agreement, including an option for the customer to modulate its fleet volume. A second significant Commercial Services customer entered into a five-year extension, with options to extend, also on materially less favorable terms and with fleet volume modulation rights.

Fluctuations in fleet volume under these arrangements could cause our revenue, results of operations, and cash flows to vary from period to period and could have a material adverse effect on our business, financial condition, and results of operations. Additionally, any future termination of either extended contract could have a material adverse effect on our business, financial condition, and results of operations.

Goodwill and Intangible Assets Impairments

We recorded a $64.0 million impairment to goodwill in our Parking Solutions segment during the six months ended June 30, 2026, which is presented in a separate line item on the consolidated statements of operations. This was in connection with our 2026 assessment of goodwill impairment which determined that the Parking Solutions reporting unit carrying value exceeded the estimated fair value. As part of this assessment, we determined that the carrying value of certain intangibles within the Parking Solutions segment were not recoverable and recorded a $40.4 million impairment to intangibles in our Parking Solutions segment during the six months ended June 30, 2026, which is presented in a separate line item on the consolidated statements of operations.

2026 Full Year Guidance

Any guidance that we provide is subject to change as a variety of factors can affect actual operating results. Certain of the factors that may impact our actual operating results are identified below in the safe harbor language included within Forward-Looking Statements of this press release.

We are providing the following forward-looking guidance, which includes Adjusted EBITDA, Adjusted EPS, and Free Cash Flow, all of which are non-GAAP financial measures (defined below).

Based on our first half 2026 results and our outlook for the remainder of the year, we are revising our 2026 full year financial outlook to the following:

• Total Revenue of $945 million to $965 million
• Adjusted EBITDA of $360 million to $370 million
• Adjusted EPS of $1.11 to $1.17
• Free Cash Flow of $105 million to $115 million

Underlying Assumptions for 2026 Full Year Guidance

• Weighted average fully diluted share count expected to be approximately 153 million shares for the full year 2026
• Effective tax rate (including state taxes) is expected to be 28.0% to 29.0%, with approximately $35 million in total cash taxes expected to be paid in 2026. The effective tax rate for non-GAAP adjustments is provided in the Reconciliation of Net Income to Adjusted Net Income and Calculation of Adjusted EPS
• Depreciation and amortization expense expected to be approximately $120 million for 2026
• Total interest expense, net expected to be approximately $62 million, of which approximately $60 million is expected to be net cash interest paid
• Change in working capital (change in operating assets and liabilities) is expected to result in a use of cash of approximately $30 million for 2026 primarily related to both our recent RAC contract renewals and the timing of expenditures and collections of our ongoing installation work in New York City
• Capital expenditures (purchases of installation and service parts and property and equipment) are expected to be approximately $135 million for 2026 relating primarily to camera installations and MOSAIC implementation

Conference Call Details

Date: August 5, 2026
Time: 5:00 p.m. Eastern Time
To access this conference call by telephone, register here to receive dial-in numbers and a unique PIN to join the call.
Webcast Information: Available live in the "Investor Relations" section of our website at http://ir.verramobility.com.

A replay of the call will also be made available on the Investor Relations website. A copy of the earnings call presentation will be available on the Investor Relations section of our website.

About Verra Mobility

Verra Mobility Corporation (NASDAQ: VRRM) is a leading provider of smart mobility technology solutions that make transportation safer, smarter, and more connected. The company sits at the center of the mobility ecosystem, bringing together vehicles, hardware, software, data, and people to enable safe, efficient solutions for customers globally. Verra Mobility's transportation safety systems and parking management solutions protect lives, improve urban and motorway mobility, and support healthier communities. The company also solves complex payment, utilization, and compliance challenges for fleet owners and rental car companies. Headquartered in Arizona, Verra Mobility operates in the United States, Australia, Europe, and Canada. For more information, please visit www.verramobility.com.

Forward-Looking Statements

This press release contains forward-looking statements which address our expected future business and financial performance, and may contain words such as "goal," "target," "future," "estimate," "expect," "anticipate," "intend," "plan," "believe," "seek," "project," "may," "should," "will" or similar expressions. Forward-looking statements include statements regarding changes and trends in the market for our products and services, including expected operating results and metrics, such as revenue growth and expected margins; expansion plans and opportunities; expectations regarding the fluctuations in fleet volume under our arrangements with two of our significant Commercial Services customers; expectations relating to our selection by the City of Los Angeles to implement California's largest speed safety program and the contract with the New York City Department of Transportation ("NYCDOT"); expectations regarding the prospect for long-term renewal with our other significant Commercial Services customer; our ability to improve operational efficiencies, generate cost savings and improve customer centricity; our ability to achieve expected benefits from transformation and strategic initiatives; full year guidance for 2026, including expected total revenue, Adjusted EBITDA, Adjusted EPS, and Free Cash Flow, and the underlying assumptions for the 2026 full-year guidance, including expected weighted average fully diluted share count, effective tax rate and cash taxes, expected depreciation and amortization expenses, expected interest expense, net and total net cash interest, expected change in working capital, expected capital expenditures, and expected operating expenditures; expectations relating to momentum across key growth areas and our pipeline; our ability to meet our long-term outlook; the expected benefits of our smart mobility platform, including margin expansion impact; and expectations concerning our share repurchase program. Forward-looking statements involve risks and uncertainties, and a number of factors could cause actual results to differ materially from those currently anticipated. These factors include, but are not limited to, the impact of negative industry and macroeconomic conditions, including inflation and higher interest rates, the impact of government actions and regulations, such as tariffs, trade protection measures, and military conflicts, on our customers or Verra Mobility; customer concentration in our Commercial Services and Government Solutions segments, including risks impacting these segments such as travel demand and legislation, and the risk of losing a customer; risks related to our contract with NYCDOT, which comprises a material portion of our revenue, including the timing of payments; risks associated with fluctuations in fleet volume under our arrangements with two of our significant Commercial Services customers; risks associated with the renewal of Commercial Services customer agreements or any future termination of any such contracts; risks related to the contractual renewal discussions with our third significant Commercial Services customer; risks and uncertainties related to our government contracts, including legislative changes, termination rights, delays in payments, audits, and investigations; decreases in the prevalence or political acceptance of, or an increase in governmental restrictions regarding, automated and other similar methods of photo enforcement, parking solutions, or the use of tolling; our ability to successfully implement our acquisition strategy or integrate acquisitions; failures in or breaches of our networks or systems, including as a result of cyber-attacks or other incidents; risks and uncertainties related to our international operations and our ability to develop and successfully market new products and technologies into new markets; our failure to acquire necessary intellectual property or adequately protect our intellectual property; our ability to manage our substantial level of indebtedness; our ability to maintain effective internal controls over financial reporting; risks related to our goodwill and intangible assets, which have been subject to impairment and may be subject to further impairment in the future; our ability to properly perform under our contracts and otherwise satisfy our customers; risks associated with the use of artificial intelligence ("AI") and related tools and our ability to achieve expected benefits from AI; our ability to incorporate AI into our business and transform our data into valuable insights, deliver more intelligent software and hardware, improve our efficiency of our operations and create a new generation of AI-enabled transportation solutions that strengthens customer outcomes, improves roadway safety and increases the long-term value of our technology platform; decreased interest in outsourcing from our customers; our ability to keep up with technological developments and changing customer preferences; our ability to compete in a highly competitive and rapidly evolving market; risks and uncertainties related to our share repurchase program; risks and uncertainties related to litigation, including pending securities litigation, and other disputes and regulatory investigations; our reliance on specialized third-party providers; and other risks and uncertainties indicated from time to time in documents we filed or will file with the Securities and Exchange Commission  (the "SEC"). In addition, no assurance can be given that any plan, initiative, projection, goal, commitment, expectation, or prospect set forth in this press release can or will be achieved. This press release should be read in conjunction with the information included in our other press releases, reports, and other filings with the SEC. Additional information regarding the factors that may cause actual results to differ materially from these forward-looking statements is available in our SEC filings, including our 2025 Annual Report on Form 10-K and first quarter 2026 Quarterly Report on Form 10-Q. These forward-looking statements speak only as of the date of this press release and except to the extent required by applicable law, we do not assume any obligation to update or revise any forward-looking statement, whether as a result of new information, future events and developments, or otherwise. Understanding the information contained in these filings is important in order to fully understand our reported financial results and our business outlook for future periods.

Additional Information

We periodically provide information for investors on our corporate website, www.verramobility.com, and our investor relations website, ir.verramobility.com.

We intend to use our website including our quarterly earnings presentation as a means of disclosing material non-public information, additional financial and operating metrics and for complying with disclosure obligations under Regulation FD. Accordingly, investors should monitor our website, in addition to following our press releases, SEC filings, public conference calls, webcasts, and social media. In addition, you may enroll to automatically receive e-mail alerts and other information about our company by visiting "Email Alerts" under the "Investor Resources" section of the "Investors" portion of our website.

Non-GAAP Financial Measures

In addition to disclosing financial results that are determined in accordance with U.S. generally accepted accounting principles ("GAAP"), we also disclose certain non-GAAP financial information in this press release. These financial measures are not recognized measures under GAAP and are not intended to be, and should not be, considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. EBITDA, Adjusted EBITDA, Free Cash Flow, Adjusted Net Income, Adjusted EPS, Adjusted EBITDA Margin, Net Debt, and Net Leverage are non-GAAP financial measures as defined by SEC rules. These non-GAAP financial measures may be determined or calculated differently by other companies. As a result, they may not be comparable to similarly titled performance measures presented by other companies. Reconciliations of these non-GAAP measurements to the most directly comparable GAAP financial measurements have been provided in the financial statement tables included in this press release, and investors are encouraged to review the reconciliations.

We are not providing a quantitative reconciliation of Adjusted EBITDA, Adjusted EPS, or Free Cash Flow which are included in our 2026 financial guidance above, in reliance on the "unreasonable efforts" exception for forward-looking non-GAAP measures set forth in SEC rules because certain financial information, the probable significance of which cannot be determined, is not available and cannot be reasonably estimated without unreasonable effort and expense. In this regard, we are unable to provide a reconciliation of forward-looking Adjusted EBITDA to GAAP net income, Adjusted EPS to net income per share and Free Cash Flow to net cash provided by operating activities, due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliation. Due to the uncertainty of estimates and assumptions used in preparing forward-looking non-GAAP measures, we caution investors that actual results could differ materially from these non-GAAP financial projections.

We use the non-GAAP metrics EBITDA, Adjusted EBITDA, Free Cash Flow, Adjusted Net Income, Adjusted EPS, and Adjusted EBITDA Margin to measure our performance from period to period, to evaluate and fund incentive compensation programs and to compare our results to those of our competitors. We use the non-GAAP metrics Free Cash Flow in connection with managing the business and we use the non-GAAP metrics "Net Debt" and "Net Leverage" to understand our overall leverage position and to evaluate capital allocation decisions. In addition, we also believe that these non-GAAP measures provide useful information to investors regarding financial and business trends related to our results of operations and that when non-GAAP financial information is viewed with GAAP financial information, investors are provided with a more meaningful understanding of our ongoing operating performance, liquidity, and leverage relative to other periods. These non-GAAP measures have certain limitations as analytical tools and should not be used as substitutes for net income, cash flows from operations, earnings per share, other consolidated income, cash flow, or debt data prepared in accordance with GAAP.

EBITDA and Adjusted EBITDA

We define "EBITDA" as net (loss) income adjusted to exclude interest expense, net, income taxes, depreciation and amortization. "Adjusted EBITDA" further excludes certain non-cash expenses and non-recurring items.

Free Cash Flow

We define "Free Cash Flow" as net cash flow provided by operating activities less purchases of installation and service parts and property and equipment.

Adjusted Net Income

We define "Adjusted Net Income" as net (loss) income adjusted to exclude amortization of intangibles and certain non-cash or non-recurring expenses such as loss on extinguishment of debt, among other items.

Adjusted EPS

We define "Adjusted EPS" as Adjusted Net Income divided by the diluted weighted average shares for the period.

Adjusted EBITDA Margin

We define "Adjusted EBITDA Margin" as Adjusted EBITDA as a percentage of total revenue.

Net Debt

We define "Net Debt" as total debt, net excluding original issue discounts and unamortized deferred financing costs, less cash and cash equivalents.

Net Leverage

We define "Net Leverage" as Net Debt divided by the trailing twelve months Adjusted EBITDA as of the current quarter-end.

Additional Metrics

Recurring Revenue or Recurring Service Revenue

We define "Recurring Revenue" or "Recurring Service Revenue" as all revenue other than product sales for each of our segments, as we typically generate revenue on a recurring monthly basis under long-term contracts with our customers. This includes our Commercial Services segment where we generate service revenue through processing of tolls, violations, and titles and registrations.

 

 

 

 

 

 

 

 

Investor Relations Contact
Mark Zindler
mark.zindler@verramobility.com

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SOURCE Verra Mobility