Repay's KUBRA deal adds revenue and takes margin away

Repay Holdings released its third-quarter 2026 results on November 9. Total revenue was $153.4 million, up 97% from $77.7 million a year earlier. The company reports organic growth of 14%, including a 9-point contribution from political media revenue. In its Consumer Payments segment, the release says KUBRA, the business Repay acquired, contributed about $65 million of revenue, representing 8% year-over-year growth.

Margins moved the other way. Total gross margin was 65%, compared with 74% a year earlier, and the cost of services rose to $53.9 million from $19.9 million. Repay raised its target for annualized cost synergies exiting 2026 to $11 million from $8 million.

The outlook changed in two places. Repay kept its 2026 revenue guidance at $490 million to $500 million and adjusted EBITDA at $168.5 million to $176 million. It lowered its normalized organic revenue growth guidance to 5% to 6% from 7% to 9%, and its free cash flow conversion guidance to 20% to 25% from 30%. Net leverage was 3.8 times at quarter-end, and the company says it remains on track to get below 3.0 times by the end of 2027.

The release gives no purchase price for KUBRA in the part we read. Its cash flow statement shows $348.2 million paid for the acquisition over the first nine months of 2026, net of cash acquired.