After a Record 2023, Thomas Priore and Priority Starts 2024 With Strong Earnings Report

Following record fiscal 2023 earnings, Priority Technology Holdings reported an 11.2% jump in revenue and a 21.2% increase in adjusted gross profit for the first quarter of 2024. Thomas Priore, chairman and CEO of Priority, said the result shows the company’s dedication to creating a unified commerce experience continues to succeed with clients.

Priore credited Priority’s unprecedented performance to investments in technological infrastructure and the diversification of services. This includes the third quarter 2023 acquisition of Plastiq, a business-to-business payments company that provides working capital solutions and automated accounts payable and receivable.

“Maintaining the momentum we established throughout 2023, we delivered solid results in [small and midsize businesses], B2B payables, and enterprise payments in the first quarter of 2024,” Thomas Priore said in an earnings call with analysts and investors. “Our unified commerce vision continues to resonate with our customers, combining payments and banking functionality in a single platform. It’s accelerated by the strength of our diverse business lines that were positioned to benefit from higher interest rates and to perform in a variety of macroeconomic environments, including the one we’re experiencing today.”

 

Priore noted that Priority processed about $120 billion in transactions in the past 12 months. The company also administered $980 million in average daily deposits at the end of the first quarter of 2024. Priore said in the earnings call that he expects this growth to continue throughout 2024.

 

“We are laser-focused on the continued innovation of our SaaS payments and banking suite of services and accelerated commerce engine, and are eager to meet the evolving needs of our growing portfolio of customers and enterprise partners,” he said.

Priority Exceeds Expectations in a Variety of Financial Metrics

The first quarter 2024 report featured impressive numbers across the board for Priority when compared to the same quarter in 2023. Revenue for Q1 2024 surged 11.2%, from $185 million to $205.7 million. Adjusted gross profit jumped 21.2%, from $63.1 million to $76.4 million. Operating income for the quarter increased 66.3%, from $16.8 million to $28 million, while adjusted EBITDA increased 23.1%, from $37.6 million to $46.3 million.

When looking at revenue per segment, Priority generated $21.1 million in revenue from B2B services, driven by the acquisition of Plastiq as well as growth in CPX, the end-to-end B2B payments platform that automates all accounts payable to reduce costs and generate cash for companies when they pay suppliers. Adjusted gross profit from B2B reached $6.2 million.

The enterprise segment generated $40.9 million in revenue for Priority, driven by new monthly enrollments and billed clients, an increase in the number of Passport program managers, growth in deposit balances, and a stable interest rate environment, according to the earnings report. The quarterly adjusted gross profit from the B2B and enterprise segments exceeded that from the small and midsize business segment, representing 59% of the company’s adjusted gross profit.

The Q1 2024 report follows Priority’s record 2023 earnings. In addition to quarterly revenue and adjusted gross profit highs, the company earned a $275.3 million profit in 2023, a 21% gain over 2022.

Thomas Priore noted that the company’s continued growth reflects its commitment to operating as the leading platform for unified commerce, delivering integrated payments and banking solutions at scale.

“Our customers and current market conditions continue to reinforce our belief that systems combining features of both payments and banking to distribute funds in multiparty environments will be critical as businesses put greater demands on software and payments solution providers to accelerate cash flow and optimize working capital,” Priore said in the earnings call about the company’s record 2023 earnings. “We’re committed to meeting our customers’ expectations by refining the experience of our partners to make working with Priority as seamless and simple as we can.”

He added that Priority’s clients range from small to large businesses with a growing number of clients using B2B and enterprise solutions. “We are highly focused on the continued innovation of our SaaS payments suite of services and the path-forward commerce engine and are eager to meet the evolving needs of our growing portfolio of customers,” Thomas Priore said.

Thomas Priore Talks About the Future of Priority and Unified Commerce

Thomas Priore co-founded Priority in 2005 with a mission to make payments more convenient and accelerate cash transactions, focusing primarily on SMBs. It’s since grown into a fintech powerhouse that delivers integrated payments and banking services for businesses of all sizes. Priority has also expanded into a wide variety of industries, offering B2B and B2C services for companies in real estate, health care, construction, e-commerce, and consumer finance.

Priority continues to add clients and forge partnerships. For example, on April 23, 2024, Priority announced a new strategic partnership with Ahrvo Labs Inc. and its portable identity gateway. The partnership integrates Priority’s payment and banking offerings into the gateway, a payment and banking network that provides access to 200-plus financial institutions through one onboarding process.

In the earnings call about the company’s 2023 earnings, Thomas Priore said Priority’s leadership expects “strong growth in margin trends in our business channels to continue in the year ahead.”

He added that everything Priority has done in the past several years, including investment in technology infrastructure and the acquisition of Plastiq, was done “with intention and purpose to provide our customers with an elegant, unified commerce experience, combining our pillars in acquiring payables and banking on a single platform.

“Our results are demonstrating we’re achieving that goal. Priority has made the turn to delivering tech-enabled services that accelerate cash flow and optimize working capital through a powerful commerce platform to collect, store, lend, and send money, allowing us to approach the marketplace in acquiring payables and banking solutions in a unique way.”