Corpay (CPAY) Q3 2026 Earnings Call: Corporate Payments Growth Accelerates

Key Takeaways

• Corpay reported Q3 2026 revenue of $1.38 billion, up 18% year over year, while cash EPS increased 32% to $7.54.
• Organic revenue grew 11%, marking the sixth consecutive quarter of double-digit organic growth. Corporate Payments led the quarter with 18% organic growth, or 20% excluding float.
• Organic Corporate Payments spend increased 24% to $95 billion. Companywide sales rose 24%, retention remained at 92.2%, and same-store sales increased 2%.
• Management raised its Q4 outlook to approximately $1.37 billion of revenue and $7.65 of adjusted EPS at the midpoint. Full-year 2026 guidance increased to $5.35 billion of revenue and $28 of adjusted EPS.
• Corpay expects 9%–11% organic revenue growth in 2027, with Corporate Payments growing at least in the mid-teens. Management also expects approximately $2 billion of free cash flow available for acquisitions or share repurchases.
• The company continues to simplify its portfolio through non-core divestitures while directing more capital toward Corporate Payments, particularly spend management.

Key Financial Data

Business and Operating Performance

Corporate Payments

Corporate Payments was Corpay’s main growth engine, with organic revenue increasing 18%. Cross-border and spend management both contributed, supported by new sales and higher customer activity.

Cross-border organic sales grew more than 25% year over year. Corpay said the migration of Alpha’s corporate systems was substantially complete, while integration of global bank accounts remained on track for early 2027.

Spend management benefited from sales and volume growth. Corpay expects more than $500 million of new Corporate Payments business in 2026, which management said should create a 7%–8% revenue growth ramp into 2027 as bookings convert into revenue.

The company is also expanding spend management internationally. Its U.K. platform reached more than $1 billion of annualized volume and was expected to exit Q4 with a $15 million revenue run rate. Management plans to increase selling investment and pursue both organic expansion and acquisitions outside the U.S.

Vehicle Payments and Brazil

Vehicle Payments delivered 8% organic growth. Corpay intends to keep investing in the segment to support high-single-digit growth, with incremental distribution spending weighted toward Brazil and Europe.

Two Brazilian vehicle debt acquisitions are expected to grow more than 30% in 2026 and now represent about 20% of Corpay’s Brazil consumer revenue. Management also highlighted strong sales growth in its Brazilian B2B electronic payment product for shippers and truck drivers.

Lodging

Lodging organic growth improved to 3%. The larger workforce lodging business grew at a double-digit rate, while smaller areas such as insurance and airlines performed less strongly. Management said the business is recovering, although the outlook for some smaller lodging assets remains uncertain.

Acquisitions and Portfolio Rotation

Alpha and Avid are exceeding Corpay’s initial 2026 accretion targets. Management expects the two investments to contribute more than $1.40 of cash EPS accretion in 2026, compared with the original $1 target.

Avid’s EBITDA doubled year over year to a record level. Corpay expects Avid to generate double-digit organic revenue growth in 2026 and materially increase earnings again in 2027. Management said the probability of acquiring the remaining Avid stake has increased, but no decision is certain.

Corpay completed two non-core divestitures in 2026, receiving approximately $1.2 billion of proceeds. Those proceeds supported repurchases of more than 3 million shares, or roughly 5% of the company. Additional divestiture candidates are in the market, primarily smaller or growth-constrained assets outside Corporate Payments.

AI and Payment Infrastructure

Corpay has introduced conversational virtual assistants and proprietary AI agents across several businesses. One cross-border AI agent analyzes client positions and recommends hedging solutions, with the objective of identifying risk-management opportunities and improving productivity.

On digital payment rails, management said private blockchain and tokenized-currency networks are gaining relevance because they are programmable and available around the clock. Corpay is using JPMorgan’s Kinexys network for tokenized currency and BVNK for stablecoin capabilities, although the company said stablecoin volume remains limited.

Management Guidance

The full-year revenue outlook includes approximately $120 million from two businesses divested during 2026. That revenue will not be included in Corpay’s reported 2027 revenue base. Management said the divestitures were neutral to adjusted EPS because of associated share repurchases.

For the medium term, Corpay outlined an objective of increasing adjusted EPS from $28 in 2026 to approximately $50 by 2029. Management said this objective depends on sustained organic growth of about 10%, cash profit expansion, disciplined repurchases and accretive Corporate Payments acquisitions.

Risks and Points to Watch

• Approximately 100 basis points of Q3 Corporate Payments growth came from monetization initiatives that management is not certain will repeat in Q4. On a normalized basis, management characterized Q3 Corporate Payments organic growth as about 17% and total organic growth as about 10%.
• Vehicle Payments faces a more difficult year-over-year comparison in Q4.
• The $120 million of 2026 revenue from divested businesses will not recur in Corpay’s 2027 reported revenue.
• Financial institution clients in the Mastercard cross-border partnership are taking longer to implement than corporate clients, slowing revenue conversion relative to management’s preferred pace.
• Lodging has improved, but performance remains uneven across workforce, insurance and airline-related businesses.
• Management’s 2027 and 2029 objectives depend partly on sales production, retention, acquisitions and capital allocation outcomes.

Analyst Q&A Highlights

• Visibility into 2027 growth: Management attributed its confidence to the combination of stable retention, same-store sales growth and the revenue ramp from 2026 bookings. Corporate Payments retention is closer to 95%, according to the company.
• Corporate Payments monetization: Corpay is expanding beyond virtual cards through debit cards and paid or faster ACH products. Management said 80%–85% of payment spend currently remains unmonetized, creating an opportunity to broaden merchant payment methods.
• Spend management M&A: The current acquisition focus reflects timing rather than reduced interest in cross-border assets. Corpay is still integrating Alpha, particularly its banking infrastructure, while directing near-term M&A resources toward spend management.
• Foreign-exchange volatility: Management said FX volatility can help or hurt activity by as much as roughly 10% depending on timing and mix, but the effect generally normalizes over a quarter and is not material over a full year.
• Brazil growth: The Brazilian business is benefiting from vehicle debt services and a B2B payment product for shippers. Management said the latter’s sales were growing approximately 40%.
• Portfolio simplification: Corpay expects further divestitures over the next 14 months and additional Corporate Payments acquisitions. Management emphasized that sales will be selective and will consider valuation and tax leakage.
• Processing economics: A larger Corporate Payments mix can improve processing efficiency because cross-border and spend management use fewer platforms than the geographically fragmented Vehicle Payments business. Management cautioned that total margins may not necessarily rise because Corporate Payments also requires higher sales investment.

Full Earnings Call Transcript

Complete Earnings Call Transcript

Management Remarks

Operator

Hello, and welcome, everyone joining today's Corpay Third Quarter 2026 Earnings Conference Call. [Operator Instructions] Please note, this call is being recorded. [Operator Instructions]

And it's now my pleasure to turn the meeting over to Jim Eglseder, Investor Relations.

James Eglseder

Good afternoon, and thank you for joining us today for our earnings call to discuss the third quarter 2026 results. With me today are Ron Clarke, our Chairman and CEO; and Peter Walker, our CFO.

Our earnings release and supplemental materials for the quarter are available on the Investor Relations section of corpay.com. Please refer to these materials for an explanation of the non-GAAP financial measures discussed on this call along with a reconciliation of those measures to the most applicable GAAP measures.

Our remarks today will include forward-looking statements about expected operating and financial results, strategic initiatives, acquisitions and divestitures, among other matters. Forward-looking statements may differ materially from actual results and are subject to a number of risks and uncertainties. Some of those risks are mentioned in today's press release and on Form 8-K and can also be found in our annual report on Form 10-K. These documents are all available on our website and at sec.gov.

So now I'll turn the call over to Ron Clarke, our Chairman and CEO. Ron?

Ronald F. Clarke

Okay. Jim, thanks. Good afternoon, everyone, and thanks for joining our Q3 2026 earnings call. Upfront here, I'll plan to cover three subjects: First, provide my take on our Q3 results, share our Q4 forecast and an early preview of 2027. Second, I'll cover our portfolio transformation and M&A progress. And then lastly, I'll share just a few exciting developments since we last spoke.

Okay. Let me begin with our Q3 results. We reported Q3 revenue of $1.38 billion, that's up 18% and cash EPS of $7.54. That's up 32%. These results better than expectations. We had a slightly better macro in the quarter, and our spend management business overperformed.

Overall, organic revenue growth in Q3, 11% that marked six consecutive quarters of double-digit organic revenue growth. Inside that, our Corporate Payments segment accelerated to 18% organic growth, actually 20%, excluding float. Vehicle Payments segment grew 8% right on expectations.

Trends in Q3 quite good. Sales or new bookings up 24% versus prior year, retention stable at 92.2% and improving same-store sales plus 2% for the quarter. We did continue to get meaningful earnings accretion from our 2 big deals, Alpha and Avid in the quarter. So look, in summary, another very good quarter, very clean and importantly, our corporate payments growth accelerating.

Okay. Let me make the turn to our Q4 outlook. We are raising Q4 revenue guidance at the midpoint to $1.37 billion and cash EPS at the midpoint to $7.65. That would be up 27%. We expect Q4 overall organic revenue growth of 10% at the midpoint, led by our corporate payments growth, which we expect to remain in the high teens, and that's consistent with what we've been delivering all year. We do have preliminary October results and have incorporated those into this overall guide.

Assuming we achieve today's Q4 guidance, our full year 2026 results will finish as follows: Full year revenue would finish up 18%. Cash EPS would be up over 30%, and cash EPS of $28 for the full year would be a full $2 higher than our initial $26 guide back in February. So look, a terrific year financially.

Okay. On to a 2027 preview. We are again out looking 9% to 11% organic revenue growth in 2027. Corporate Payments segment, again, we're expecting mid-teens growth or better there. Our corporate payments new sales this year here in 2026, expected to top $0.5 billion. So that provides really an embedded revenue ramp for growth into 2027. We'll also put roughly $2 billion of free cash flow to work next year either on spend management acquisitions or buybacks wherever we see the best return.

All right. Let me make the turn to our portfolio transformation and M&A. Again, we're progressing our portfolio transformation to fewer bigger businesses. The portfolio becoming simpler. Corporate payments becoming larger. We have divested two non-core businesses here in 2026, receiving proceeds of about $1.2 billion. We used those proceeds to buy back over 3 million CPA shares or roughly 5% of the company.

We have launched a couple of additional divestiture candidates that are in the market now. We're also continuing to pursue new and meaningful corporate payment acquisition targets that can further accelerate our mix shift to more spend management.

In terms of performance, our two most recent deals Alpha and Avid exceeding our 2026 accretion targets. We expect together, they'll contribute over $1.40 of cash EPS accretion this year versus our going-in $1 target. We have migrated Alpha's cross-border corporate payments line of business off its IT platform and on to ours, along with its back office compliance and ops functions.

Avid doing well. We expect Avid to double earnings here in 2026 and then materially increase them again in 2027. Maybe more importantly, Avid expects to execute this year with double-digit organic revenue growth, which would be the first in a long time. So these deals aren't just financially accretive, they're making our corporate segment bigger, more profitable and more important to us.

On the Brazil front, we did acquire two Brazil vehicle debt companies last year. Combined, these two deals will grow over 30% this year here in 2026. And those two deals will now represent about 20% of our overall Brazil consumer revenue, so becoming significant. So it makes this vehicle debt adjacency terrific add-on for us. It's really just another example of finding attractive adjacencies around businesses where we already have some kind of built-in advantage.

So look, the important point here is the portfolio rotation. It's working. We're simplifying the company. We're putting more capital behind corporate payments and the assets we bought, they're performing. And you should expect to see even further rotation again next year.

Okay. So last up today, I do want to share just a few exciting developments since we spoke last. So first, on the AI front, we've made some real progress. AI for us is now providing some tangible clients and productivity benefits. We've launched conversational virtual assistance across a number of our businesses being used to help automate our clients' work.

We are incorporating the new AI tools into our client-facing IT development work boosting IT productivity. And we've developed some really cool proprietary AI agents. I'll call out one, our super dealer clone in our cross-border business. It analyzes and recommends hedging solutions across our global client base and uncovers kind of new risk mitigation opportunities that our dealers might otherwise miss. So really exciting. Look, so for us, AI isn't just about productivity. It's also about helping identify opportunities to serve our clients better.

So corporate payments, you may recall that we entered the U.K. market earlier this year with our Corpay Complete spend management solution that leverages our U.S. tech platform and our pretty big presence in the U.K. So this year, with that platform, we've now grown the U.K. spend management volume to over 1 billion annualized exiting Q4 with a $15 million revenue run rate. So it proves our U.S. tech platform can travel internationally. We do have customers, distribution infrastructure around the world. So taking our corporate payments platform to new markets does create additional runway for us.

So last up, we dropped our new, what we call hidden gem video ad on the Corpay website today. It out CP's relative performance within the storied S&P 500 Index. So if you screen the S&P 500 for companies that grow revenue more than 9%, grow profits more than 15% and have margins above 50%, there are 18 companies. And Corpay is one of them joining other elite performers, the likes of Microsoft, Visa, Mastercard and NVIDIA. So look, Corpay combines a pretty rare combination of growth, margins and free cash flow.

So look, to wrap today in conclusion, again, obviously pleased with our Q3 performance. We put up some real growth versus last year and marked again, six straight quarters of double-digit organic growth. Our corporate payments segment, again, high teens growth in the quarter. We are raising our Q4 guidance based on the momentum along with our preliminary view of October. Excited about 2027. We're out looking another year of double-digit organic growth. And again, roughly $2 billion of free cash flow to put to work. And overall, we're building a simpler company with fewer bigger and faster-growing businesses. So lots of progress.

So with that, let me turn the call back over to Peter. He'll provide some additional details on the quarter and our outlook.

Peter Walker

Thanks, Ron, and good afternoon, everyone. We delivered another excellent quarter with 18% revenue growth and 32% adjusted EPS growth year-over-year, both ahead of our expectations. Organic revenue growth was 11%, our sixth consecutive quarter of double-digit organic growth. The quarter demonstrates the durability of our model. We continue to benefit from strong execution across the business and a favorable macro environment.

Sales grew 24%, same-store sales increased 2% and retention remained healthy at 92.2%. Those results reflect the focus and discipline of our teams as we continue to invest behind the opportunities with the strongest long-term returns.

Now let's turn to our segment performance and the underlying drivers of our organic revenue growth in the quarter. Corporate Payments delivered 18% organic growth in the quarter, accelerating from Q2. The performance was driven by continued strength in both cross-border and spend management. We're pleased with the momentum in these businesses driven by new sales growth and strong underlying customer activity with organic spend increasing 24% to $95 billion.

Cross-border continued to deliver strong sales performance with year-over-year sales growth over 25% on an organic basis. The Alpha corporate system migration is substantially complete and the global bank account integration on track for early 2027.

Our spend management business, formerly referred to as our payables business, performed exceptionally well, driven by sales and volume growth. We continue to be pleased with the strong performance of Avid, our minority investment, which is reflected as an equity investment in our financials. Avid continues to deliver sales growth, strength in volume and revenue and EBITDA doubled year-over-year to a record level.

Vehicle payments delivered 8% organic growth, consistent with Q2 and in line with our expectations. The business continues to execute well across the globe. We remain focused on allocating our investments to the highest return opportunities, including investing in vehicle payments to continue high single-digit growth. Lodging delivered 3% organic growth, improving sequentially for the third consecutive quarter. While there's still work to do, the direction of the business is encouraging and consistent with the progress we expected through the year.

In summary, our 11% organic growth was broad-based across the largest businesses. Corporate Payments and vehicle payments, which together represent over 80% of our revenue delivered a combined 13% organic growth rate. These results give us continued confidence in the consistency and compounding of our model.

Now looking further down the income statement. Operating costs increased 9%, excluding the impact of FX, M&A, stock compensation, amortization and a prior year other operating loss of $11 million. The 9% increase reflects growth investments and the cost of supporting higher volumes. Adjusted EBITDA grew 17% to almost $800 million and adjusted EBITDA margin was 57.4%.

The strong margin reflects the high flow-through of revenue growth as well as continued operating discipline. Adjusted EPS grew 32%, driven by strong operating performance, accretive M&A almost 5 million less shares from buybacks and a lower adjusted effective tax rate of 23.4%. The year-over-year decrease in the tax rate was primarily driven by excess tax benefits in the period related to grandfathered stock options exercised.

Turning to the balance sheet. We generated approximately $500 million of free cash flow in the quarter. We ended the quarter at 2.72x leverage. Following the November 2 closing of the maintenance divestiture and application of the proceeds, pro forma leverage is approximately 2.47x and decrease sequentially. Post receipt of the maintenance divestiture proceeds, we had approximately $2.6 billion of total liquidity including $1.7 billion of undrawn capacity under our revolving credit facility.

During the quarter, we repurchased $750 million of stock or approximately 1.9 million shares. Also, the Board approved a $1 billion increase to our share repurchase authorization, bringing total remaining capacity to approximately $1.6 billion. This is another example of our disciplined capital allocation approach. -- maintaining a strong balance sheet, investing in the business and returning excess capital to shareholders when it represents an attractive use of capital.

Now let me share some additional information on our updated 2026 full year and fourth quarter outlook. We are raising our full year revenue guidance to $5.35 billion at the midpoint, growing 18% year-over-year. We're also raising full year adjusted EPS guidance to $28 at the midpoint, growing 31% year-over-year.

As a housekeeping item, the $5.35 billion includes approximately $120 million from the two divestitures completed in 2026, which were neutral to adjusted EPS due to buybacks. This $120 million will not be included in our 2027 print revenue.

Our updated outlook reflects the flow-through of our third quarter outperformance, raises fourth quarter due to favorable macro conditions and continued underlying strength in the business and the updated closing date of the maintenance divestiture. For the fourth quarter, we expect revenue of approximately $1.37 billion and adjusted EPS of $7.65 at the midpoint.

Before I close, I want to put our midterm opportunity in perspective. We are clear on the direction of the company, build a simpler portfolio of scaled advantaged businesses, expand our corporate payments platform to deploy capital where it can compound value most effectively. Our objective is to continue to be a top quartile S&P growth compounder.

The growth algorithm we outlined in our investor presentation can compound adjusted EPS at more than 20% annually from $28 this year to approximately $50 per share by 2029. That objective is supported by sustained 10% organic revenue growth, cash profit expansion and disciplined share repurchases and accretive corporate payments M&A.

Over time, a larger corporate payments mix and continued investor confidence in our growth model could support a re-rating of our valuation.

So operator, that concludes our prepared remarks. Please open the call for questions.

Operator

[Operator Instructions] We'll take a question from Ramsey El-Assal with Cantor Fitzgerald.

Question-and-Answer Session

Ramsey El-Assal

Another great quarter here. I want to ask about the sales growth of 24%. That's a great outcome. Just curious if you can give us any more color on where you're seeing the strength in the business.

Ronald F. Clarke

Ramsey, it's Ron. Yes, another good sales number. I just want to point out a huge amount now in our Corporate Payments business. I quoted in the thing for the full year, we're looking at probably $500 million plus of new business. And I want to point out to people that creates because it gets booked, obviously, over the course of the year, right, some as late as November and December. That creates kind of a ramp of 7% or 8% revenue growth in 2027. So sometimes people don't appreciate the power of sales that we make in the prior year in terms of this benefited in the forward year. So -- also Brazil, super good in terms of sales blockbuster, including the vehicle debt thing that I mentioned. So those two would be best. And I'd say our international business maybe helped a little bit by fuel prices also super good. So those three all high performers in the quarter.

Ramsey El-Assal

Awesome. One quick follow-up for me. Are you seeing any downstream impact from higher diesel prices on credit performance or any other aspects of the fleet side of the business I know the freight's got a role, and I know that freight prices don't necessarily correlate, but I was just curious if you're seeing any impact in the business from just a sustained higher kind of diesel price level.

Ronald F. Clarke

Yes. I think it helps, Ramsey, a bit on sales, right, higher prices that creates more cost of control. I say a my bid a same-store sales soft is still probably a point or so when the prices being higher, people cutting back a little bit, but nothing significant. As I mentioned, our consolidated business was plus 2% in terms of same-store sales. So 2 of the 11 points come from the client base getting healthy. So fortunately, not much in terms of the impact from the price.

Operator

We'll move next to Michael Infante with Morgan Stanley.

Michael Infante

Nice results here. Ron, you called out on your prepared remarks, the M&A focus within corporate payments being on spend management. Why is that relative to cross-border? Is that just a function of the portfolio being pretty well rounded out post alpha with the MCA product, and you sort of feel like incremental acquisition can sort of improve the value proper competitors in the core payables business? Just any color there would be great.

Ronald F. Clarke

Yes. That's a super good question. I would say it's really more timing. So I don't want anyone to leave the call, thank buy more across border. Mostly, it's just trying to digest what we've got. We've done a lot there. We're still digesting Alpha, particularly on the banking side. And so -- we turned our energy starting in the spring over the spend management category both here and abroad. So it's really just that. We want to keep building both of those categories, but the 1 up right now is spend management.

Michael Infante

Makes a lot of sense. And then just for a quick follow-up. I'm curious if there's any context you could share on the U.S. Canada corridor in corporate payments in the quarter. Was there any notable take rate pressure we should be aware of that maybe actually made the growth, which obviously incrementally accelerated potentially be a little bit more depressed than it otherwise would have been?

And then stepping back, like as you sort of think about higher levels of FX evolve being good for your hedging business? Like are there instances where customers, for whatever reason, are sort of choosing to wait for Val to reside a little bit before placing those hedging trades? I'm just trying to think about the puts and takes between those two.

Peter Walker

Michael, it's Peter here. So on your Canada U.S. quarter question, I would say nothing unusual happening within that corridor. You did ask about kind of the uptick in corporate payments. And so I just wanted to share with you, there's about 100 basis points of, call it, onetime monetization happy within Q3 that we don't know is necessarily repeatable in Q4. So corporate payments normalized is probably more like [ 17 ]. And overall, organic is more like [ 10 ].

Ronald F. Clarke

Michael, it's Ron. Just to follow up, it was a good question. So we've studied what you said of, hey, when we look at the volatility index around FX, how does it affect things. So we've looked at it over a longer period of time. I think for our business, given the mix it can have kind of up to a 10% help or hurt. But basically, what happens is the timing that you spoke of, it kind of cleans up over a quarter. to your point, if someone is kind of still for a month and the tariff on some of the contracts is running out the base tend to get the thing cleaned up. So I'd say over a quarter, and honestly, over the year, it doesn't have a big impact.

Operator

We'll move on now to Sanjay Sakhrani with KBW.

Sanjay Sakhrani

Very nice acceleration in Corporate Payments. I'm just curious, was there anything specific that drove that inside the business? And then do we think that, that type of growth is sustainable as we move into next year?

Ronald F. Clarke

Sanjay, very good question, and it was kind of all things firing volume was up crazy good because of my comment earlier about we've been making a lot of sales the retention to get in that business is above the line average is closer to 95%. And I'd say some of the extra juice is we've gotten focused a bit more on the monetization front. So we've got a couple more dances in our repertoire. So said just virtual cards, we did launch earlier this year, debit cards as a way to monetize. And we've advanced what we call kind of paid or ACHs getting paid for ACH. So it would be a mix of those things. volume from, again, continued good retention, crazy amount of sales getting online and then a bit better monetization, particularly here in Q3.

Sanjay Sakhrani

Got it. And then maybe just to go back to the questions on expense management. I think it's the cross-border piece of your story is pretty well known now and appreciate it. I guess when we think about expense management and then you layer in Avid as well to some extent. Like what's the kind of growth rate that business can see over a sustained period, maybe over the intermediate term, like the next 3 years. I'm just curious if it's the same type of growth that the cross-border Corporate Payments business can deliver.

Ronald F. Clarke

Yes. It's another good question. I mean, the TAM is obviously gigantic, right? Kind of all the domestic indirect spend of the business. And so it's really a function of sales investment there. I think the biggest difference in the two businesses is our cross-border business is super global. 75% of the revenue of that business is originated outside of the U.S.

So think Canada, U.K., Europe, Australia, et cetera. Whereas in the spend management business, even including Avid, it's predominantly a U.S. business today, which is why I called out our interest in Europe, not only doing it ourselves by moving our tech over, but also looking at acquisitions. And so I'd say that it certainly has the TAM to be a beast in terms of the size of the business and the focus that we're on is kind of opening up now additional markets where we can bring the product beyond the U.S.

Operator

We'll move on now to Tien-Tsin Huang with JPMorgan.

Tien-Tsin Huang

I just wanted to ask on the quarter, of course. Just thinking here about the visibility into double-digit growth next year? How would you characterize that the visibility part maybe compared to last year or last couple of years?

Ronald F. Clarke

Tien-Tsin, good to hear from -- is how I characterize it. And I was saying to people earlier that he talking about the growth of in the company, a [ 10, 13, 19 -- 10, 13, 19 ] and we don't spend enough time on the growth algorithm for revenue, hey, how do you get to 10%. And so I continue to say to you guys, hey, how are sales in the quarter, how is retention in the quarter, how we're saying sales. That is the growth. And so the way we get to 10% is pay the base grows 2%. We sell a bunch, we lose the 8%. And so the beauty particularly as we rotate in the corporate payments is my comment earlier that we sell more of it in the prior period.

So the example that I gave of if we sold, call it, $500 million of corporate payments last year, we already know how much revenue we're going to get from the ramp in 2027 that we didn't get in 2026. And we also have a good sense of how much we get in the current year, like what will we sell like we're up 24%. So we're how much of that print in 2027. So it gives us a pretty wide band, if you think about it, to build the plant the revenue exits and I keep 92% of it, the same-store sales inches up one point or two. I've already got the ramp in the bag and even myself the same amount as the prior year, I know what we print -- so the variables to get to a number, this is the business you can plan. I'll remind you of. So we like that, and I'd say it's even more so in the Corporate Payment space than in the vehicle.

Tien-Tsin Huang

I'm familiar to ADP in a lot of ways. I know you've said that to me before.

Ronald F. Clarke

That's how I got your partners, a ante model, I chase. You got it.

Tien-Tsin Huang

That's been a durable one for three decades have tracked. Just maybe as my follow-up, I'm just curious because coming off of some of these conferences, digital assets and tokenized deposits, blockchain rails. Any change or surprise in activity there, movement there, Ron?

Ronald F. Clarke

We just think, Tien-Tsin, we feel clear if the world has caught up to our view. But what I think we would say is we're pretty convinced that people should separate currencies, tokenize to from crypto or Sangos from the rail, from blockchain versus Swift or something else. So our view of the world is the winner will be tokenized yet because you've already -- everyone's already got it and it's what's worked. And that the blockchain is going to be a super interesting additional rail because it's programmable and it's 24/7. So it's the banks, as you see the announcements as they get ready to credit positions that come off of the blockchain 24/7, we see way increase in that rail being used. And so we're still kind of short on the stable going narrative and believe in the blockchain rail coming on as the banks start to move that crediting to real time. So that's what we're behind. We're investing a lot and we see it already. The mix of our business that move from Swiss started to move on to these private blockchain rails and stuff. And so we think the lift in that is going to be quite substantial next year.

Operator

We'll move on now to Darrin Peller with Wolfe Research.

Darrin Peller

You mentioned investing in the vehicles area to maintain high single-digit growth. Is this just a specific geo or further in sales and marketing or product development? Just help us understand a little bit more about where you're putting it towards and the outcome?

Ronald F. Clarke

Yes. Darrin, so again, the vehicle business is global. It's here, it's in Europe and in Brazil. And I think we've said repeatedly, we kind of love our competitive positioning even more in Brazil and in Europe, super dominant. We've got leading products and stuff. So -- of the three geos, we tend to spend more kind of incremental money distribution money in those places and the margins are quite attractive and stuff. And so look, we're balancing. We said repeatedly, we're balancing, particularly the sales of tech investment in vehicle versus corporate payments the target trying to keep the vehicle business in all geographies in the high single digits and put most of the money behind, obviously, Corporate Payments. So really no change in approach there, and you should continue to see the best market, the best geography for sale, the second best year and the third, the U.S.

Darrin Peller

Okay. All right, Ron. Just a quick follow-up on the divestitures. Again, I appreciate the announcement on the -- of another investor this quarter. Just Help us understand how we should think about further divestitures. I mean, should we expect it to be in the vehicles business? Or -- and as you focus on a few large businesses, could we see something more strategic? Just any more color you can give us to update us would be great.

Ronald F. Clarke

That's a good question, Darrin. So I did mention at the top that we've got a couple additional message of assets in the market now, I think, call it, $1.5 billion to $2 billion, war. And so yes, generally, the answer is you would find smaller niche year vehicle businesses or other kind of non-core, noncorporate payments businesses as the life of candidates. And basically, it's either size. It's small or b, it's TAM constrained. We don't think we can grow at a higher rate.

And so we kind of apply that screen. We study the tax leakage and stuff and pick candidates where we think we can keep simplifying the company, right, have fewer bigger businesses. So it's not so much just category -- the only category we're not divesting obviously is Corporate Payments we're acquiring. But you could see the lodging business and the vehicle business select pieces inside those businesses that don't make sense for us to hold long term that makes sense for someone else to own to be better owner than us. So that's what we're focused on.

And we're being smart, I think, in patient. We're not throw them out of the plane at any price. We're being thoughtful about the state of those businesses. And again, the tax leakage on and selling things like this maintenance 1 where effectively it's a push. -- we can exit the business and get enough proceeds to kind of wash the thing from an earnings perspective. So -- my message to everybody is we're going to keep doing it. We're not liking the super duper rush. We're going to keep you'll see more stuff sold in the next 14 months, and you'll see more stuff acquired in corporate payments. So when we're sitting here a year from today, in addition to the differential growth rates, you'll see the mix keep moving as we acquire corporate payments and divest everywhere else.

Operator

We'll move on now to Rayna Kumar with Oppenheimer.

Rayna Kumar

I just want to ask on lodging. So you had organic growth improved to 3%, but room nights remain down and revenue per room increased. So could you just talk about how much of the recovery is pricing versus mix? And if you think this recovery is sustainable and just the long-term plans for launching?

Ronald F. Clarke

Yes, that's another good question. So yes, the rate and the volume is really just what you said, it's mix. So for example, we talked about this emergency kind of client or FEMA that has sporadic kind of uneven volumes and it is super duper cheap. So when that thing flexes up or down, hey, there's a lot of rooms that are achieved right, there's no rooms that are achieved that drives the average room rate up or down. So there's really nothing other than that going on. It's just it has a big swing because, again, it's so cheap.

On the more important question, the recovery question, it is clearly better. I mean let me point out something may be more important. So yes, hey, the lodging business is in positive territory. I think it's lot plus 3 for the quarter. In the size that the biggest business, which we continue to like a lot, we call workforce, which means we go to businesses that have kind of blue collar people that stay kind of blue-collar hotels, that workforce business is up double digit. And so the other smaller Darrin's question, nicer things like insurance or airlines are doing less well. And so it's averaging to that 3% that gives us do better, we think, again, in Q4 on a combined basis.

So the headline is the bigger business in lodging, the important -- the more important one is doing significantly better than a couple of years ago when it was a problem child. And yes, we do think we can make that. It used to be for the first 10 years, we own in a terrific business, and we think we can make get a good business again. It's already pretty good business here in Q3.

The other SA, the jury is still out on those of whether they're fixable or not.

Operator

We'll move on now to Ken Suchoski with Autonomous Research.

Kenneth Suchoski

I wanted to ask about Corporate Payments and the outlook there. You're obviously growing high teens to 20% ex float year-to-date. 20% this quarter. Is there any reason the underlying business wouldn't keep growing at these levels next year, right? You have the 7- to 8-point ramp from new sales retention is great. So that was the first part of it.

And then the second part was just on the reported like corporate payments organic number because you've been absorbing this 200 basis point float headwind and as you lap that and it turns neutral or possibly a tailwind, just help us bridge from where we are today to that mid-teens or better type level. Is that just conservatism necessarily? Or are there other offsets like the onetime monetization this quarter, comps or take rate or anything like that?

Ronald F. Clarke

Ken, that's another good question. I'd say first and foremost, it's just early days. It's the first of November of the year. We are eagerly working on the plans and try to get precision, right? We're trying to get whatever, $5 billion or $6 billion. So there's a lot of details to do. We're willing to help to your point, to the extent that the sulfur curves become true. I think the thing picks up kind of 25 basis points per quarter next year, kind of $75 million for the total. That will help. That may give us a point or so depending on our deposit balance.

But the main answer to the question of, hey, are we at 15, 17 or 20 is just sales. Like the retention number I keep saying it's like super stable. We have statistics, we have the clients, they like the product. That thing is like super duper solid. And so it's really this level of investment that we put in and the production that we get -- and so I'm making this up, if we sold $550 million instead of $500 million, you can do the math that would add another point or two right to the growth in the following year. So the positive thing is we roll into the next year kind of headway already getting there, right? We've sold enough and retaining enough that if we were yes, we still have a decent growth rate heading into 2027. So the crane the top of it is going to be just what level of sales production do we get.

A good one, a little bit better than this year or a great one lot. So that's why we always say, "Oh, is it 16, 17, 18, what is it? It's really a function of that level of sell-in production.

Kenneth Suchoski

Yes, it seems like the corporate payment sales are becoming a bigger part of the mix. as well by our estimates. Just one on Avid because the results are really impressive there. I mean doubling earnings year-over-year, I think you talked about growing double-digit organically exiting this year. So just maybe give us some detail on what's driving that? Is it sales investment you put in? Is it product changes? Is it pricing? What's driving that? And how durable is that?

Ronald F. Clarke

I think it's been great to them if you talk to the guys there getting out of the public things that could work on the business, I think, has helped that the management team there is focused and we, with our partner have been kind of super clear on, hey, these are the things and you're on and we've way stepped up the sales investment in the business. we pushed some of the monetization things that we think were laid down, and we cut the cost structure a bit or I should say, rightsize the cost structure to the thing.

And so -- and a lot of that happened throughout 2026. I can't remember, we closed the thing in the fall about a year. So by the time we get the plan in place and go when we were kind of into '26. So one of the reasons I say that the '27 numbers will be better, it's a lot of the things that Mike and Dan are putting in there going during this calendar year. And so some of that will just literally roll into 2027.

So it's just in a -- they always had a really good business, like happy clients, higher retention stuff. I think it hasn't been product. They've got a good product. It's really been on the economics that we bring a way aggressive pricing and cost and economic profit lends to a business. And so they've kind of taken that thing and they're getting way better numbers, and they're going to get better numbers. I think the 27 will be materially better. And we think even better after that, they signed some significant new partners this year and stuff. And so the business is really performing well.

Operator

We'll move on now to Dave Koning with Baird.

David Koning

And I guess my question is on Brazil. You gave a nice disclosure about Brazil revenue dollars. And from looking at that, if I kind of back out currency, it looks like that accelerated a little bit in Q3, maybe the higher teens more mid-teens in the first half of the year. And I guess you have that phenomenon, but then transactions, total transactions decelerated just a bit. So maybe describe kind of what's happening maybe the Google ad search data, all the Brazil stuff.

Ronald F. Clarke

It's doing well. And the Google thing is still not working well, although the government and Google have agreed that it will be back. They're just running through some papers. So we think certainly no later than January 1, that thing will be back. But the Brazil thing is doing well for a few reasons. One, it's a giant in the core business, and I think keeps coming along. But the two accelerants have been this vehicle debt thing that I named, which probably doesn't sound that clear, but we've got 7 million or 8 million people that have accounts and have total accounts and stuff. And so we literally go to them plus 80 million people that don't go on the toll road and we say, look, we're connected to every DMV, which is 36 in Brazil and can immediately reregister on your phone and let you know if you have a ticket and when it's due and pay it online and stuff. And so that add-on thing is just crazy growing. We've got like a 5% share of the business. It's compounding. It's got 5x the TAM because you can drive anywhere and still need a registration and stuff.

So I do want to point out that although it seemed like a bit of a side show when we entered, it's left the side show status, right? It reaches 20% of the business and compounding faster. The second one is we're just killing it on the B2B side. This thing called Valley which in English pause on the translation, but basically suppliers or shippers have to pay for drivers to go places. And so we came up with a Super Duper electronic product that if you're like a serial manufacturer or shipper and you got to pay like 100 truckers to go somewhere, the product literally defines exactly where they can go and when so that it's optimized. The shipper doesn't pay any more than they need with stuff. And so we are selling crazy amounts of that product like the sales growth is at 40%. So those two things are going at crazy levels of growth on top of a pretty sound, solid business to begin with.

Operator

We'll move next to Mihir Bhatia with Bank of America.

Mihir Bhatia

I wanted to start first with just Corporate Payments. I mean you obviously have very nice spend growth there. I think there's a little bit of a gap to the revenue growth, I think the spend was 24%, revenue was 18%. You did talk a little bit about better monetization. And I think you've talked in the past about citing bigger clients. But maybe just remind us what's driving the gap? And how should revenue continue to grow? Meaning should this gap increase as we get into '27 and '28.

Ronald F. Clarke

It's just mix, like, if we -- I think we said we signed a giant elephant to it took a while to eat -- it's at a completely different kind of a rate. So you move a ton of volume through the system and you move less revenue through. So no, there's nothing structurally between the spend levels and the revenue we're obviously focused on revenue more than spend. But you do raise a good question, which is we have a lot of spend. I don't know what it is 80%, 85% of the spend that we move billions and billions that is not monetized. And so -- as I mentioned earlier, that is the assignment but we are on trying to widen the ways that we can pay merchants that's useful to them beyond virtual cards. And we're seeing a lot of success, as I mentioned, with debit cards. That's another way to pay. We've got a lot more people to take this kind of recon and fast instant kind of ACH product. And so we did get a lift, as I mentioned, in Q3 on that. So that would be the other thing. We keep selling a lot, like I mentioned earlier, in addition to what's already in the bag. And then basically try to push this monetization a bit higher with some of the merchants.

Mihir Bhatia

Got it. Maybe then just switching quickly to Avid. You mentioned -- you scope doing quite a bit of detail on it. And progress they've made. But given you have the option to buy the rest of it, I believe, in 2028, does the progress you're seeing now make that increasingly likely? Should we just think about that as a remaining use of capital in 2028? And is Avid part of the $50 EPS guide?

Ronald F. Clarke

That's another good question. So I don't know, like we have an option, a couple of years out to buy it tomorrow, we could buy it up to whatever 2 years plus from now. So like what we want is what you said, which is to see more progress, I want to see more absolute profitability there so that when we send the capital, we're bringing more earnings into the company. And I do still want to see further acceleration in their revenue closer to our corporate payments book of business. And so we're kind of cheering and help directing from the sidelines to get the company's performance higher. But I would say yes, to your question is that the likelihood of us calling and buying the balance of that company is certainly higher than when we closed on it a year ago. But I'd still say not certain. We'll obviously look at everything else that we can buy with that capital in a couple of years and make the call as we get closer.

Operator

We'll move on now to Chris Zhang with UBS.

Chao Zhang

My first question is about your partnership or relationship with MasterCard and BVNK and specifically focusing on the maybe the cross-border business as MasterCard and BVNK recently launched a Global Money platform. And -- we've been getting some of the questions on whether this is any potential opportunities for you to partner, whether it is some of the competition to your multicurrency account business? And now in your multicurrency account probably approach those clients from a different perspective in the form of local bank account opening. But maybe can you just talk to maybe comparing contracts, some of the differences between the MasterCard and PV&K partnership and your opportunities with them specifically related to the Global Mining platform and multicurrency accounts and whether just in the market, whether you're seeing maybe some of the competition picking up because of some of the newer offerings out there.

Peter Walker

Yes. Chris, this is Peter. Thanks for the question. So maybe folks on the MasterCard partnership for a ownership was focused on our cross-border business. MasterCard an investment in us as part of that. And that is a go-to-market to partner with Mastercard with FIs and really sell our cross-border products into FIs. And so what I'd say is that, that partnership has been going well in terms of full pipeline. We signed up quite a few clients. But what we are learning is that FIs are much longer to implement than our corporate clients. So I'd say it's going well, but it's going probably slower than we would ideally like it to be.

The BVNK was -- which is now owned by Mastercard, it's a different partnership where we partner with BVNK to enable our stable coin rails that we established earlier this year. So -- moving to tokenizes currency, we wanted to make sure that we had stablecoins available and we're doing that via B&K as a partner there. And then we've also partnered with JPM using their Conexus network for digital -- I'm sorry, for tokenized currency. So I'd say the Canexus network has really been where we've moved the majority of our volume. We're still not seeing a lot of volume on a stablecoin side.

Ronald F. Clarke

And Chris, it's Ron. Just to add on to what Peter said about the competition. So like our my view is they're more of a platform kind of provider, and we're more a marketer. So for us, the competition or the opportunity is taking multicurrency accounts to the markets, to the accounts and prospects that we have. So obviously, without we've got a dominant position in the asset management group along with all those fund administrators. .

So as we widen that product to new geographies, we already have built in clients, right? I've got Bank Capital in Boston. I've got bank capital in U.K. I've got a bank Capital in Australia. And so -- and then second, we got a ton, I don't know, 30,000, 40,000 corporate clients, midsized clients that we're signing up thousands every year. The idea of taking these products to the clients that we have as an add-on. So don't mix kind of the supply of the products, if you will, from the marketing. So yes, there's probably more competition in making of the products, but our real advantage is in the marketing of selling of the products.

Chao Zhang

All right. And Peter, appreciate the color. My follow-up is on the organic growth in the Q4 guide, that's 10%. Do you can you talk to some of the moving parts between that and the 11% is delivered in Q3? And if you were to be more conservative in some of the areas, where would that be? And specifically, I guess, for lodging, do you expect some of the pickup, knowing it's like a smaller piece, but I think basically, it's trending a little lower than previously expected. And then for vehicle, what's kind of the outlook outside of Brazil, especially in North America and the rest of the world.

Peter Walker

Yes. So Chris, at the start of the call, I talked a little bit about corporate payments in the third quarter and the fact that we had about 100 basis points of, call it, monetization initiatives that we're not sure repeatable in 4Q. So call that 100 basis points off of the '18 and off of the 11%. So it's really a 10 to 10. So you're seeing really eagle performance between the two quarters. So that's kind of the main takeaway that I would give you. Maybe the other point that I would add is vehicle payments is obviously a little bit of a tougher comp over Q4 of last year.

Ronald F. Clarke

Yes. Chris, the other thing is just the history of Q3 and Q4. We've got years, 5, 10 years that you guys have. They tend to be super comparable in terms of revenue. In fact, if you look at our guide, probably plus or minus $10 million or so. We do have a lot of staff based on days in which businesses are stronger in Q4 and stuff. And so to Peter's point, it's kind of mostly a mirror image that the print you see in Q3 will look super similar to that in Q4, probably with the one call out Peter just made.

Operator

We'll move next to Madison Suhr with Raymond James.

Madison Suhr

You touched on it a few times just around early traction in the U.K. with Spend Management. Clearly, a huge TAM to go after across Europe. Ron, you touched on the geographic expansion opportunity. So the question is really just how aggressive do you plan to be on rolling out into other countries? And should we think about this as an early 2027 event?

Ronald F. Clarke

Yes. Madison, it's a good question. I think we wanted to start with this market because it's our second biggest market and find out like can we make it work? Can the platform travel and be adaptive to there? And can we get people trained up and leverage the customers we have and all that kind of stuff. And so we kind of went at it a bit modestly, but that's $1 billion, like from kind of like from zero.

So it was like that's good. So now I'm staring we're staring at the plans for next year and sitting in their submission is to double again the selling investment in that thing. And so also, clearly, we're looking at the deals in those geographies. So I would say that you guys should expect to see more spend management revenue in more geographies that are outside of the U.S., both organically where we send our platform and stand up people, we have people in all these places and tons of salespeople in these places, but also that we may acquire -- customers or products in that region probably do both of those things.

Madison Suhr

Okay. That's helpful. And then just a real quick follow-up. Just on the Brazil competitive environment. Any meaningful changes to what you're seeing just around new entrants or pricing in that market specifically?

Ronald F. Clarke

Not really other than I think the banks are getting tired. I think the great idea 5 years ago, Hey, I get something away free, it's going to be great. I think that they're getting a little wary of the thing. And it's got a place where now like 3 or 4 of the banks are literally taking our product and will -- Look, I think at some point, there'll be tired of that, and we'll look forward to that day. But -- our product is still so advantaged at such broader networks than just the toll tag, the free flows, the new thing, which we're on. So we're a high ads, if you will, on that product. And so we'd like the banks to like either charge or go away, but really nothing new right now.

Operator

We'll move on now to Dominick Gabriele with Loop Capital.

Dominick Gabriele

The business really has turned towards corporate payments. And so when we think about this mix shift over the long term, given it does feel like it could accelerate, I'm looking at your processing cost as a percentage of revenue, and they've ticked down over the last number of years. And I'm just wondering if there's a mix shift benefit across that line item, in particular, given the payments that folks may use or whatever it may be. If you could help us understand some of the mix shift benefits of moving towards more corporate revenue as a percentage of the total in the P&L, I'd really appreciate it.

Ronald F. Clarke

Dominick, it's Ron. That's a very astute observation. The simple answer is your right to processing economics are better because there's fewer systems. So if you think about like our vehicle business, which is in the U.S., the U.K. and Brazil, we probably run six platforms that are specialized, let's say, for the trucking business or the partner business or in Brazil or something, whereas in the corporate payments business like cross-border we run one processing system. And we just closed Alpha's corporate processing system, and it's been management, same thing. And so the operating leverage, if you will, of effectively have running one system with more volume on the flow-through margins to your point against the processing costs are better. So that is the main -- again, this other costs, obviously, we might spend more on selling because we want to try to grow faster and stuff. So I don't want to imply the total margins are better. In fact, it probably not because of the growth rate. But you're on the right thing. It's really scale against a number of processing systems.

Operator

Thank you. This does conclude our question-and-answer session as well as our call today. You may now disconnect your lines, and everyone, have a wonderful day.