Verra Mobility Third-Quarter Revenue Falls 1%

The Tip Desk · November 10, 2026 · 4 min read

Third-quarter revenue was $258.9 million as Commercial Services fell 14% and the company reaffirmed 2026 guidance.

Verra Mobility Corporation (VRRM), a provider of smart mobility technology, reported third-quarter revenue of $258.9 million, down 1% from $261.9 million a year earlier, after 12% year-over-year growth in the second quarter.

The reversal in the top line came from Commercial Services. That segment’s revenue fell 14% to $100.3 million from $117.3 million a year earlier. Segment profit declined 22% to $61.3 million from $78.3 million.

The company said rental-car tolling revenue dropped $16.1 million, or 20%, because of contract extensions with two significant customers on terms it described as materially less favorable, fleet-volume fluctuations with one significant customer, and reduced travel demand. U.S. Transportation Security Administration passenger volume in the third quarter was about 3% lower than a year earlier. Fleet-management revenue decreased $2.2 million, or 13%; the company said that normalizing for a one-time operational adjustment and prior-period churn, fleet-management revenue would have grown 4%. Commercial Services profit margin was 61%, versus 67% a year earlier, which the company tied to reduced rental-car tolling, higher credit-loss expense, and lower volume rebates.

Government Solutions offset that decline. Segment revenue rose 12% to $136.8 million from $122.6 million a year earlier. Service revenue increased 13%, including $8.6 million from expansion in speed, red-light, bus-lane, school-bus and other services outside the New York City Department of Transportation contract and $5.6 million from NYCDOT installation revenue net of pricing changes under the new contract. Segment profit was $39.1 million versus $31.3 million a year earlier, with margin of 29% versus 26%, which the company attributed to NYCDOT installation volume, revenue mix and lower wage expenses.

Parking Solutions revenue declined 2% to $21.7 million from $22.1 million a year earlier. Segment profit was $3.5 million versus $3.8 million, with margin of 16% versus 17%.

Net income was $40.4 million, or $0.27 a share, versus $46.8 million, or $0.29 a share, a year earlier. The company said the decrease was primarily due to lower revenue and margins. Adjusted EPS was $0.36 a share versus $0.37 a share. Adjusted EBITDA was $103.9 million versus $113.3 million a year earlier, and Adjusted EBITDA margin compressed to 40% from 43%, with the company citing an approximate 560-basis point decline in Commercial Services profit margin as the primary driver.

Cash generation moved the other way. Net cash provided from operations rose to $114.5 million from $77.7 million a year earlier, and free cash flow rose to $89.4 million from $49.0 million. The company said the increase reflected items affecting operating cash, including a decrease in accounts receivable, and a reduction in capital expenditures. Cash and cash equivalents were $137.0 million as of September 30, 2026. Net debt was $903.3 million and net leverage 2.2x, versus $971.8 million and 2.3x as of December 31, 2025.

In July the company entered a seven-year extension with Avis Budget Group after that customer withdrew a termination notice. During the third quarter, Verra Mobility said ABG significantly and abruptly reduced fleet volumes. On October 2, 2026, it exercised its right to terminate the agreement effective January 30, 2027, and engaged Quinn Emanuel to protect intellectual property related to tolling and violations solutions. It also renewed Hertz for five years. Enterprise Mobility’s contract expires September 30, 2027.

During the nine months ended September 30, 2026, the company recorded a $64.0 million goodwill impairment and a $40.4 million intangible-asset impairment in Parking Solutions.

The board appointed Jon Newhard as President and Chief Executive Officer effective November 1, 2026. Craig Conti stepped down as chief financial officer effective November 4, 2026, and Matthew Kvarda was appointed interim chief financial officer effective November 5, 2026. The company said it will determine future segment reporting after the transition.

Verra Mobility reaffirmed 2026 full-year guidance of $945 million to $965 million in revenue, $360 million to $370 million in Adjusted EBITDA, $1.11 to $1.17 in Adjusted EPS, and $105 million to $115 million in free cash flow. Underlying assumptions include a full-year TSA volume decline of over 1% versus 2025 and a working-capital cash use of about $40 million related in part to rental-car contract renewals and New York City installation timing.