The company saw the revenue growth in its Merchant Solutions segment slow to 2% year over year during the quarter, according to a presentation released Thursday.
Its other two segments saw faster year-over-year revenue gains, with Payables up 14% and Treasury Solutions up 18%, per the presentation.
Priority noted in a Thursday earnings release that it renamed its three operating segments, with the previous SMB, B2B and Enterprise becoming Merchant Solutions, Payables and Treasury Solutions, respectively.
The company said in the release that the new names better reflect each segment’s solutions sets and the increasingly larger customers they serve.
Priority Chairman and CEO Tom Priore said during the earnings call that in the Merchant Solutions segment, during the third quarter, “same-store sales decelerated in multiple areas.”
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“Alternatively, merchant attrition remained stable, leading us to conclude that macroeconomic factors influencing spending are affecting performance and will likely persist through the remainder of the year,” Priore said.
Priority Chief Financial Officer Tim O’Leary said later during the call that the macroeconomic factors causing slower growth in Merchant Solutions affected that segment’s core portfolio.
“Lower growth in the core portfolio compared to the first half of the year was largely attributable to a pullback in consumer spend within a few industry verticals, including restaurants, construction and wholesale trade,” O’Leary said.
During the call, Priore highlighted two acquisitions Priority made during the third quarter, including the revenue agreements and customer relationships of Boom Commerce, one of its reseller partners, and substantially allof the assets of Dealer Merchant Services (DMS), a vertically focused reseller in the auto and truck dealership sector.
“The Boom transaction adds veteran sales depth with exclusive distribution partnerships expanding our West Coast capabilities, while the addition of the DMS team will underpin our strategy to lean into the future of automotive commerce with vertically focused distribution and integrated payments, treasury and payables solutions to the steadily growing and historically defensive area of consumer spending,” Priore said.
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