Tyro Payments (ASX:TYR) used its FY2026 half-year earnings call to highlight improving payment volume trends, stronger profitability and cash generation, and increased investment plans for the second half as it pushes into new growth initiatives and integrates its recently announced acquisition of Thriday.
New CEO outlines focus and Thriday rationale
Chief Executive Officer Nigel Lee, speaking on his first results call as Tyro’s new CEO, positioned the company as a “domestic champion” built to address the complexity faced by Australian small and medium-sized businesses. Lee said Tyro now supports more than 76,000 merchants and processes more than A$43 billion in annual transaction volumes, arguing that scale and operating discipline can translate into “durable cash generation” and capacity to fund further growth.
Lee also emphasized customer feedback on Thriday, saying its customers are “genuinely evangelical,” reflected in high ratings and word-of-mouth recommendations. He said Tyro’s job will be to “preserve and scale that customer obsession” while leveraging Tyro’s infrastructure, reach, and balance sheet.
Payments rebound supports top-line momentum
Chief Financial Officer Emma Burke said the half-year reflected a shift in payments momentum versus the prior year, when total payment volumes were down nearly 1% compared with the previous period. In the first half of FY2026, total payment volumes increased 4%, driven by 5.6% growth in “Tyro Core” payment volumes.
Within Tyro Core, Burke said growth was broadly consistent at 4%–5% across retail, hospitality, and services. She attributed the improvement to a general uplift in consumer spending, lower churn, and the contribution from larger merchants onboarded in FY2025 who are now contributing more meaningfully.
In Health, Burke reported 9.4% volume growth as Tyro continued focusing on specialist, allied health, and dental segments. She noted that increased bulk billing funding introduced by the government at the end of the half has put some pressure on general practitioner volume growth, and Tyro will monitor how practices adapt. Burke said the change does not affect Tyro’s outlook for growth in its “key health subverticals,” and she reiterated confidence in the medium-term health growth outlook.
Burke also highlighted weaker performance in volumes tied to Bendigo merchants, which fell 10% during the half. She said Tyro continues to work “constructively” with Bendigo to identify opportunities to improve overall performance.
On pricing economics, Burke said payment margin increased by 0.8 basis points compared with the first half of FY2025, primarily due to improved scheme and interchange fees, and Tyro has begun passing some of those reduced fees through to customers. The combination of higher volumes and margin improvement drove a 6% increase in payments gross profit to A$104.1 million.
Banking products see increased adoption and lending momentum
Burke said Tyro’s banking products continued to evolve to support adoption. The company launched a transaction account to new customers in September, and Burke said the addition of a debit card and instant payments improved day-to-day utility, helping drive a 38% increase in active users. She said this functionality will be made available to existing merchants in the coming months.
Tyro also launched its Tyro Flexi Loan merchant cash advance product to new customers in December. Burke said the end-to-end experience is more streamlined, and early customer feedback has emphasized simplicity and flexibility for managing cash flow and funding business growth. Loan originations increased by close to 20% compared with last year, and Tyro saw a higher average loan size.
Burke said banking gross profit increased 5.4%, supported by momentum in key banking metrics, including growth in the number of merchants using banking alongside payments. She also reported net return on banking improved to 12.2% from 11.7%, largely due to improved lending portfolio profitability.
Profitability rises; investment to increase in second half
Burke said the company maintained cost discipline in the first half, with gross profit up 5% and operating expenses down 2.9%, improving Tyro’s operating efficiency measure to 64% from 69%. She cautioned that expenses will be higher in the second half due to annual salary increases, the timing of project and marketing spending, and AML-related compliance investment.
On earnings and cash flow, Burke reported:
- EBITDA increased 19.8% to A$39.5 million, with an EBITDA margin of 33.6%.
- Statutory profit was A$17.7 million, up 72% from the prior comparable period.
- Free cash flow was A$13.6 million, up 52% year over year.
- Available funds were over A$140 million, which Burke said supports flexibility to fund the next phase of growth.
Burke reiterated full-year guidance of gross profit between A$230 million and A$240 million and an EBITDA margin between 28.5% and 30%, saying Tyro was on track at the half-year. She noted that increased investment in the second half is expected to keep the full-year EBITDA margin within the guidance range.
Management highlights growth priorities and guidance-related Q&A
Lee outlined four areas of growth focus: health, banking, e-commerce, and larger merchants. He described health as attractive with higher barriers to entry and said Tyro will continue expanding beyond general practitioners into specialists, allied health, dental, and newer subverticals including aged care and pet. In banking, he said integrated offerings can increase customer satisfaction and lifetime value, and the company is exploring additional lending products aimed at better serving larger merchants.
Lee also pointed to a “structural shift” toward online and omnichannel commerce, calling e-commerce a high-growth segment where Tyro can build on its card-present scale. For larger merchants, he said Tyro is seeing increased demand for local expertise and reliable execution, citing enterprise wins in FY2025 and continued momentum in FY2026 to date.
During Q&A, Canaccord’s Owen Humphries asked about the implied step-up in second-half operating costs under the unchanged guidance. Management responded that the second-half cost increase is expected to be driven primarily by timing-related investments, including additional AML compliance work in preparation for legislative changes, as well as project spending and marketing tied to go-to-market initiatives. Management also pointed to annual salary increases taking effect in January and confirmed there would be a step-up in absolute operating costs in the second half.
Humphries also asked about churn trends. Management said Tyro has continued to see a positive trend in total transaction value (TTV) churn, which supported growth during the period, though churn is still not back to historical average levels. Management said it remains focused on improving retention through expanded product utility across payments, banking, lending, and financial management tools.
About Tyro Payments (ASX:TYR)
Tyro Payments Limited engages in the provision of payment solutions to merchants in Australia. The company operates through two segments, Payments and Banking. The Payments segment acquires and processes electronic payment transactions from merchants; and sells terminal accessories. The Banking segment provides merchant cash advances, transaction banking accounts, and term deposit accounts, as well as business loans. It primarily serves hospitality, health, retail, trades and services, and corporate industries.
