TFIN Q2 2025: ACV Surge to $80K & 14% EBITDA Margin
- Robust Integration and Revenue Upside: The successful integration of GreenScreens is already lifting average contract values from $37,000 to $80,000 with expectations for further growth through enhanced data integration and advanced intelligence offerings over the next 90 days.
- Margin Expansion in Payments Segment: The payments business showed a significant improvement with EBITDA margins reaching 14% this quarter, and management’s long‐term target is to push margins above 40%, signaling enhanced operational efficiency as revenue scales.
- Competitive Advantage Through Data and Diversified Value Chain: Triumph’s integrated approach across factoring, payments, and intelligence—bolstered by access to 40 billion data points and a unique market-leading data set—positions it to better serve a broad customer base, driving sustainable growth and reinforcing its market leadership.
- Integration risks and near-term earnings drag: The integration of GreenScreens brings challenges as the company works to merge its data into existing models, resulting in a reported $3 million quarterly drag that could continue to pressure earnings in the near term.
- Increased competitive pressures: Competitors are already moving to capture market share—for instance, DAT’s acquisition of a similar payment platform and traditional financial institutions targeting small truckers—which may exacerbate pricing pressures and hurt margins.
- Dilutive effects from a shifting customer and revenue mix: The addition of larger customers in the factoring business is leading to a lower average invoice size, indicating that mix shifts might dilute revenue per account and create volatility in overall pricing dynamics.
| Metric | YoY Change | Reason |
|---|---|---|
Net Interest Income (Q1 2024) | -7.9% | The decrease from $93.4 million to $86.0 million resulted from a modest 1.3% rise in interest income being overwhelmed by a sharp 118.2% increase in interest expense and a 125.6% jump in credit loss expense, eroding profitability. |
Noninterest Income (Q1 2024) | +36.1% | Noninterest income increased from $11.0 million to $15.0 million, driven by higher income from payments and other noninterest activities, partially mitigating the impact of rising expenses from previous periods. |
Payments Segment Revenue (Q1 2025) | +15.7% | Revenue from the Payments segment grew from $13,126,000 to $15,184,000, fuelled by a $988,000 increase in noninterest income and higher factored receivables, marking a strong recovery compared to Q1 2024. |
Factoring Segment Revenue (Q1 2025) | -1.2% | The Factoring segment saw revenue decline slightly from $36,405,000 to $35,961,000 as a $1,184,000 fall in noninterest income was only partly offset by a $579,000 increase in interest income, reflecting internal challenges from the prior period. |
Overall Noninterest Income (Q1 2025) | Increase of $2,191,000 | A company-wide boost in noninterest income, rising from $14,999,000 to $17,190,000, was primarily driven by improved fee and revenue streams across segments, showing a continuation of the growth seen in the previous period despite mixed segment performance. |
Total Revenue (Q2 2025) | -38% | Total revenue dropped dramatically from $208.962 million in Q2 2024 to $128.6 million in Q2 2025, reflecting underperformance in multiple segments outside of a relatively stable Banking segment, likely due to broader market challenges and a shift from previous high bases. |
| Topic | Previous Mentions | Current Period | Trend |
|---|---|---|---|
Integration of strategic acquisitions | Q1 discussion focused on plans to close the GreenScreens acquisition and early-stage integration efforts. Q4 omitted details, while Q3 addressed NextGen Audit initiatives via HubTran. | Q2 provided detailed integration of GreenScreens with a 90‐day timeline, clear data incorporation, and enhanced model precision. | Increased clarity and execution detail in integration, moving from planning to a more robust, data-driven deployment. |
Revenue growth and market expansion prospects | Q1 emphasized opportunities in payments, factoring, and early-stage FaaS growth. Q4 focused on market share goals in payments and factoring, and Q3 highlighted TriumphPay’s fee revenue increases despite market challenges. | Q2 highlighted robust growth in the transportation business with optimism around a 20% annual rate and noted accelerated intelligence segment growth. | Consistent optimism with refined segmentation and clearer growth targets in Q2. |
Technological innovation and advanced product offerings | Q1 discussed LoadPay, FaaS, and the next-gen audit platform. Q4 highlighted AI integration for touch‐free invoice processing, while Q3 underscored AI-powered invoice purchasing, LoadPay enhancements, and FaaS pilots. | Q2 emphasized selective AI integration, solid LoadPay account growth, FaaS expansion (e.g. RXO onboarding), and detailed intelligence benefits from GreenScreens. | Steady emphasis on technology, with increasing sophistication and integrated offerings in Q2. |
Operational efficiency and margin expansion | Q1 noted improved credit metrics and stable headcount, Q4 focused on technology-driven efficiency in factoring and FaaS with clear margin improvement targets, and Q3 mentioned fee revenue growth improvements indirectly. | Q2 stressed improved payments EBITDA margins (up to 14%), along with disciplined expense management to drive operational efficiency. | A consistent focus on driving efficiency through tech investments, with Q2 highlighting sharper margin improvements. |
Credit quality management and risk mitigation | Q1 described proactive credit stress management (40% resolution progress) and Q4 briefly mentioned applying consistent credit practices in factoring. Q3 did not cover this topic. | Q2 reported materially improved credit quality with net charge-offs under $1 million and robust fraud prevention protocols. | Enhanced focus with tangible improvements in Q2, building on earlier proactive risk management strategies. |
Competitive landscape and market dynamics | Q1 acknowledged freight market headwinds and competitive pressures while noting opportunities. Q4 detailed CH Robinson’s entry into factoring and market share ambitions, and Q3 underscored the ongoing freight recession with network resilience. | Q2 reiterated competitive pressures and freight market challenges, emphasizing their dominant presence in key segments and proactive positioning. | Continued recognition of market challenges with steady confidence in competitive positioning, though Q2 focuses more on leveraging data capabilities. |
Customer mix transformation and revenue dilution risks | No mentions in Q1, Q4, or Q3 [N/A]. | Q2 introduced a discussion on shifting customer mix impacting average invoice sizes, advising focus on the payments segment for clearer market signals. | A new emerging topic in Q2 reflecting concerns on revenue dilution from evolving customer segments. |
Execution and monetization uncertainty of new initiatives | Q1 reviewed uncertainties in monetizing new initiatives such as FaaS and the CH Robinson relationship. Q4 stressed cautious rollout of intelligence, LoadPay, and FaaS with gradual revenue expectations, and Q3 discussed incremental revenue from TriumphPay. | Q2 described a transition from growth to value mode with active repricing conversations and detailed plans to capture monetization from innovations. | An evolution toward more immediate monetization as products mature, while remaining cautious in execution. |
Strategic partnerships and network expansion | Q1 emphasized the CH Robinson relationship and legacy client upgrades. Q4 provided an in‐depth discussion of CH Robinson’s rollout, market share targets, and LoadPay channel integration, and Q3 focused on network growth via C.H. Robinson’s onboarding. | Q2 did not explicitly mention CH Robinson but referenced strong industry relationships and a broad network presence supporting strategic growth. | A well-established theme in previous periods; while Q2 is less explicit, the network strength underpins ongoing strategic partnerships. |
Shifting role and evolving perception of the Intelligence segment | Q1 positioned Intelligence as a strategic growth engine tapping a $600M market. Q4 discussed its evolution driven by customer feedback, emphasizing neutrality, high margins, and data credibility, whereas Q3 omitted discussion. | Q2 underscored the Intelligence segment as the fastest-growing area with detailed GreenScreens integration and higher engagement with top brokers. | A reaffirmation of high growth potential, building on earlier customer-driven evolution with enhanced integration and strategic positioning in Q2. |
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Margin Outlook
Q: What’s the outlook for EBITDA margin?
A: Management expects margins to steadily improve from 14% this quarter, targeting a long-term level above 40% by scaling revenues faster than expenses, reflecting a disciplined operating model. -
GreenScreens Integration
Q: How will GreenScreens integrate and perform?
A: The acquired GreenScreens, with a $10M ARR base, is set for integration over 90 days, with early signs showing increased ACV—from approximately $37K to $80K in the pipeline—boosting its performance. -
Supply Chain Finance
Q: What growth potential exists for supply chain finance?
A: Management is enthusiastic about expanding supply chain finance as it naturally enhances liquidity and operational efficiency for brokers, forming a core part of their value-added suite. -
Factoring Dynamics
Q: Will invoice prices shift with customer mix changes?
A: While the average invoice size may be tempered by a diversified customer mix—including larger, multi-service clients—the change reflects a robust and broad-based factoring strategy. -
Deposit Mix
Q: What is the composition of noninterest deposits?
A: More than half of the noninterest deposits originate from mortgage warehousing, with just under half coming from TPAY float, signaling a stable and focused deposit base. -
Load Pay Impact
Q: What revenue can be expected per account?
A: Mature load pay accounts are estimated to generate around $700+ in revenue on average, though initial dilution may occur with new account additions until they fully mature. -
Competitive Impact
Q: How does DAT’s move affect the competitive landscape?
A: Though DAT’s acquisition of a payment platform targets the factoring space, management views it as one among many competitive moves in a crowded market, not fundamentally altering long-term market dynamics. -
Factoring Volume & Seasonality
Q: Do reported factoring volumes include FAS; is intelligence seasonal?
A: The invoice volume figures blend both traditional factoring and FAS, while the intelligence segment has shown remarkable stability with virtually no seasonal fluctuations. -
Corporate Expense Investments
Q: How will rising noninterest expenses benefit the company?
A: Increased spending on information security and infrastructure is designed to strengthen risk management and operational efficiency, ensuring the company remains resilient despite high transaction volumes.
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