CPI Card Group Lifts 2026 Revenue and Cash-Flow Outlook
Second-quarter revenue rose 15% to $149.2 million as the company raised 2026 free-cash-flow guidance to $45 million–$50 million.
CPI Card Group Inc. (PMTS), a payments technology company providing physical and digital payment solutions to U.S. financial institutions, processors and fintechs, raised its 2026 revenue-growth and free-cash-flow outlook after a second quarter that exceeded its expectations.
The company now projects high-single-digit to low-double-digit revenue growth for the year, up from prior guidance of high-single-digit growth, and free cash flow of $45 million to $50 million, up from a conversion rate in line with 2025 results of $41 million. All other 2026 targets were affirmed, including low-to-mid single-digit Adjusted EBITDA growth and a year-end net leverage ratio between 2.5x and 3.0x.
Revenue in the quarter ended June 30, 2026, increased 15% to $149.2 million from a year earlier. That year-over-year rate slowed from 20% in the first quarter, when revenue was $147.1 million, after a 22% increase in the fourth quarter of 2025. The second quarter was driven by strong performance in Secure Card Solutions.
Net income increased 294% to $2.0 million, or $0.17 a share, from $518,000 a year earlier. Adjusted EBITDA increased 7% to $24.1 million. The earnings result was primarily attributable to Secure Card Solutions overperformance and more than $3 million of tariff refunds, partially offset by uneven demand in Prepaid Solutions. Net income was also impacted by $2.8 million of integration costs primarily related to Arroweye.
Secure Card Solutions, which includes Arroweye on-demand solutions, posted revenue of $110.9 million, up 17%. The increase was driven by higher sales of contactless cards and personalization services and the addition of Arroweye. Segment gross profit increased 29%, and gross margin increased 250 basis points, primarily due to increased revenue and tariff refunds.
Prepaid Solutions revenue increased 18% to $22.6 million, primarily due to an accounting change implemented in the second quarter of 2025, partially offset by comparisons with strong sales of higher-value packaging solutions a year earlier. Segment gross profit increased 17%, and gross margin remained consistent at over 28%.
Integrated Paytech revenue increased 4% to $20.1 million, with gross profit margin remaining consistent at over 55%. Companywide gross profit increased 21% to $48.5 million.
The company acquired TRISM to expand instant issuance. With the deal, CPI now serves more than 3,000 U.S. financial institutions with instant issuance, compared with approximately 2,500 before the acquisition, and raised 2026 annual revenue-growth guidance in Integrated Paytech from 15% plus to approximately 20%. Integrated Paytech segment revenue growth in the second half of the year is expected to increase, driven by momentum in Card@Once and digital solutions and the addition of TRISM.
For the six months ended June 30, revenue increased 17% to a company record of $296.3 million. Secure Card Solutions revenue increased 25% to $220.7 million. Prepaid Solutions revenue decreased 3% to $44.7 million. Integrated Paytech revenue increased 2% to $39.5 million. First-half Adjusted EBITDA increased 8% to $47.2 million.
Cash from operating activities was $42.1 million in the first half, compared with $9.9 million a year earlier. Free cash flow was a company record $36.1 million, compared with $0.8 million. The increase was primarily driven by company performance, strong working capital management and lower capital spending.
As of June 30, cash and cash equivalents were $21.4 million, and 10% Senior Secured Notes due 2029 were $265.0 million. The net leverage ratio decreased to 2.7x, down from 3.6x in the second quarter last year and 3.1x at year-end. On July 15, the company redeemed $26.5 million, or 10%, of its Senior Notes.
The Adjusted EBITDA outlook remains unchanged, as benefits from stronger Secure Card Solutions performance and tariff refunds are expected to be largely offset by continued investment in Integrated Paytech and ongoing uneven demand in the higher-margin Prepaid Solutions segment.