WEX Inc.WEX
WEX Inc. Revenue Disclosure
| 3. | Revenue | ||||
In accordance with Topic 606, revenue is recognized when, or as, performance obligations are satisfied as defined by the terms of the contract, in an amount that reflects the consideration to which the Company expects to be entitled in exchange for goods or services provided.
The following tables disaggregate our consolidated revenues, substantially all of which relate to services transferred to the customer over time:
| Year Ended December 31, 2025 | |||||||||||||||||||||||
| (in millions) | Mobility | Corporate Payments | Benefits | Total | |||||||||||||||||||
| Topic 606 revenues | |||||||||||||||||||||||
| Payment processing revenue | $ | 642.7 | $ | 395.9 | $ | 104.2 | $ | 1,142.8 | |||||||||||||||
| Account servicing revenue | 43.1 | 63.0 | 453.9 | 560.1 | |||||||||||||||||||
| Other revenue | 99.3 | 0.2 | 43.0 | 142.5 | |||||||||||||||||||
| Topic 606 revenues | 785.2 | 459.2 | 601.0 | 1,845.4 | |||||||||||||||||||
| Non-Topic 606 revenues | 600.8 | 18.2 | 196.4 | 815.4 | |||||||||||||||||||
| Total revenues | $ | 1,386.0 | $ | 477.4 | $ | 797.4 | $ | 2,660.8 | |||||||||||||||
| Year Ended December 31, 2024 | |||||||||||||||||||||||
| (in millions) | Mobility | Corporate Payments | Benefits | Total | |||||||||||||||||||
| Topic 606 revenues | |||||||||||||||||||||||
| Payment processing revenue | $ | 694.5 | $ | 409.7 | $ | 96.2 | $ | 1,200.5 | |||||||||||||||
| Account servicing revenue | 39.0 | 50.2 | 445.2 | 534.3 | |||||||||||||||||||
| Other revenue | 101.0 | — | 31.5 | 132.5 | |||||||||||||||||||
| Topic 606 revenues | 834.5 | 459.9 | 572.9 | 1,867.3 | |||||||||||||||||||
| Non-Topic 606 revenues | 566.4 | 27.9 | 166.7 | 761.0 | |||||||||||||||||||
| Total revenues | $ | 1,400.8 | $ | 487.8 | $ | 739.5 | $ | 2,628.1 | |||||||||||||||
| Year Ended December 31, 2023 | |||||||||||||||||||||||
| (in millions) | Mobility | Corporate Payments | Benefits | Total | |||||||||||||||||||
| Topic 606 revenues | |||||||||||||||||||||||
| Payment processing revenue | $ | 695.0 | $ | 428.0 | $ | 90.7 | $ | 1,213.7 | |||||||||||||||
| Account servicing revenue | 22.2 | 42.1 | 435.7 | 500.0 | |||||||||||||||||||
| Other revenue | 92.1 | — | 32.6 | 124.7 | |||||||||||||||||||
| Topic 606 revenues | 809.3 | 470.1 | 559.0 | 1,838.4 | |||||||||||||||||||
| Non-Topic 606 revenues | 573.4 | 26.8 | 109.4 | 709.6 | |||||||||||||||||||
| Total revenues | $ | 1,382.7 | $ | 496.9 | $ | 668.4 | $ | 2,548.0 | |||||||||||||||
Payment Processing Revenue
Payment processing revenue consists primarily of interchange income. Interchange income is a fee paid by a merchant bank (“merchant”) to the card-issuing bank (generally the Company) in exchange for the Company facilitating and processing transactions with cardholders. Interchange fees are set by the card network in open loop transactions and by the Company in closed loop transactions. WEX processes transactions through both closed-loop and open-loop networks.
•Mobility segment interchange income primarily relates to revenue earned on transactions processed through the Company’s proprietary closed-loop fuel networks. In closed-loop fuel network arrangements, written contracts are entered into between the Company and merchants, which determine the interchange fee charged on transactions. The Company extends short-term credit to the fleet cardholder and pays the merchant the purchase price for the cardholder’s transaction, less the interchange fees the Company retains. The Company collects the total purchase price from the fleet cardholder. In Europe, interchange income is specifically derived from the difference between the negotiated price of fuel from the supplier and the agreed upon price paid by fleet cardholders.
•Interchange income in our Corporate Payments and Benefits segments relates to revenue earned on transactions processed through open-loop networks. In open-loop network arrangements, there are several intermediaries involved between the merchant and the cardholder and written contracts between all parties involved in the process do not exist. Rather, the transaction is governed by the rates determined by the card network at the point-of-sale. This framework dictates the interchange rate, the risk of loss, dispute procedures and timing of payment. For these transactions, there is an implied contract between the Company and the merchant. In our Corporate Payments segment, the Company remits payment to the card network for the purchase price of the cardholder transaction, less the interchange fees the Company earns. The Company collects the total purchase price from the cardholder. In our Benefits segment, funding of transactions and collections from cardholders is performed by third-party sponsor banks, who remit a portion of the interchange fee to us.
The Company has determined that the merchant is the customer as it relates to interchange income, regardless of the type of network through which transactions are processed. The Company’s primary performance obligation to merchants is a stand-ready commitment to provide payment and transaction processing services as the merchant requires, which is satisfied over time in daily increments. Since the timing and quantity of transactions to be processed by us is not determinable, the total consideration is determined to be usage-based variable consideration. The variability is satisfied
each day the service is provided to the customer and we consider the services performed each day in order to ascribe the appropriate amount of total fees to that day. We measure interchange revenue on a daily basis based on the services that are performed on that day.
In determining the amount of consideration received related to these services, the Company applied the principal-agent guidance in Topic 606 and assessed whether it controls services performed by other intermediaries. The Company determined that WEX does not control the services performed by merchant acquirers, card networks and sponsor banks as each of these parties is the primary obligor and interchange income is recognized net of fees owed to these intermediaries. Conversely, the Company determined that services performed by third-party payment processors are controlled by the Company and such fees paid to third-party payment processors are recorded as service fees within cost of services.
The Company additionally enters into contracts with certain large customers or strategic cardholders that provide for fee rebates tied to performance milestones. When such fee rebates constitute consideration payable to a customer or other party that purchases services from the customer, they are considered variable consideration and are recorded as a reduction in payment processing revenue in the same period that related interchange income is recognized. For the years ended December 31, 2025, 2024, and 2023, variable consideration, including fee rebates determined to be variable consideration, totaled $1.8 billion, $2.0 billion and $2.1 billion, respectively. Fee rebates made to certain other partners in exchange for customer referrals are not considered variable consideration and are recorded as sales and marketing expenses.
Account Servicing Revenue
In our Mobility segment, account servicing revenue is primarily comprised of monthly fees charged to cardholders based on the number of vehicles serviced. These fees are primarily in return for providing monthly vehicle data reports and are recognized on a monthly basis as the service is provided. The Company also recognizes revenue related to reporting services on telematics hardware placements, which are within the scope of Topic 606, and other fees recognized as revenue when assessed to the cardholder as part of the lending relationship, which are outside the scope of Topic 606.
In our Corporate Payments segment, account servicing reflects licensing fees earned for use of our accounts receivable and accounts payable SaaS platforms, all of which is within the scope of Topic 606.
In our Benefits segment, we recognize account servicing fees for the per-participant per-month fee charged per consumer on our SaaS healthcare technology platform and a program fee for custodial services performed on behalf of our HSA account holders. Customers, including health plans, third-party administrators, financial institutions and payroll companies, typically enter into three to five-year contracts, which contain significant termination penalties. This revenue is within the scope of Topic 606.
Our Corporate Payments and Benefits segments provide SaaS services and support, which are stand-ready commitments and are satisfied over time in a series of daily increments. Revenue is recognized based on an output method using days elapsed to measure progress as the Company transfers control evenly over each monthly subscription period.
Finance Fee Revenue
The Company earns revenue on overdue accounts, which is recognized when the fees are assessed. The finance fee is calculated using the greater of a minimum charge or a stated late fee rate multiplied by the outstanding balance that is subject to a late fee charge. Finance fee revenue also includes amounts earned by the Company’s factoring business, which purchases accounts receivable from third-parties at a discount, and finance charges earned on revolving portfolio balances. These revenues are outside the scope of Topic 606.
Other Revenue
In our Mobility segment, other revenue consists in part of transaction processing revenue, other fees charged to the merchants, professional services, including software development projects and other services sold subsequent to the core offerings, the sale of telematics hardware, and permit sales to our over-the-road customers, all of which are within the scope of Topic 606. Revenue is recognized when control of the services or hardware is transferred to our customers, in an amount that reflects the consideration that we expect to receive in exchange for those services. Additionally within our Mobility segment, other revenue consists in part of fees charged to cardholders, including carrier and other miscellaneous credit card fees, and interest and investment income, all of which is outside the scope of Topic 606 and accounted for under Topic 310.
In our Corporate Payments segment, the majority of other revenue reflects interest income earned on restricted cash balances, which is outside the scope of Topic 606. In our Benefits segment, other revenue includes interest income earned on the investment of HSA deposit balances held by WEX Bank, which is outside the scope of Topic 606 and is accounted for under Topic 320 and professional services revenue, which is within the scope of Topic 606, and is recognized as the services are performed in the amount we expect to receive from these services.
Contract Balances
The majority of the Company’s receivables are either due from cardholders who have not been deemed our customer as it relates to interchange income or from revenues earned outside of the scope of Topic 606, and are therefore excluded from the table below. The Company’s contract assets consist of upfront payments to customers under long-term contracts and are recorded upon the later of when the Company recognizes revenue for the transfer of the related goods or services or when the Company pays or promises to pay the consideration. The resulting asset is amortized against revenue as the Company satisfies its performance obligations under these arrangements. The Company’s contract liabilities consist of customer payments received before the Company has satisfied the associated performance obligations. The following table provides information about these contract balances:
| (in millions) | ||||||||||||||||||||
| Contract balance | Location on the consolidated balance sheets | December 31, 2025 | December 31, 2024 | |||||||||||||||||
| Receivables | Accounts receivable, net | $ | 57.1 | $ | 60.4 | |||||||||||||||
| Contract assets | Prepaid expenses and other current assets | 17.6 | 9.9 | |||||||||||||||||
| Contract assets | Other assets | 36.2 | 29.1 | |||||||||||||||||
| Contract liabilities | Accrued expenses and other current liabilities | 26.7 | 28.6 | |||||||||||||||||
| Contract liabilities | Other liabilities | 64.8 | 51.3 | |||||||||||||||||
Impairment losses recognized on our contract assets were immaterial for the years ended December 31, 2025, 2024 and 2023. In the years ended December 31, 2025, 2024 and 2023, we recognized revenue of $27.5 million, $25.5 million and $7.8 million included in the opening contract liabilities balances, respectively.
Remaining Performance Obligations
The Company’s unsatisfied, or partially unsatisfied performance obligations as of December 31, 2025 represent the remaining minimum monthly fees on a portion of contracts across the lines of business, deferred revenue associated with stand ready payment processing obligations and contractually obligated professional services yet to be provided by the Company. The total remaining performance obligations below are not indicative of the Company’s future revenue, as they relate to an insignificant portion of the Company’s operations.
The following table includes revenue expected to be recognized related to remaining performance obligations at the end of the reporting period.
| (in millions) | 2026 | 2027 | 2028 | 2029 | 2030 | Thereafter | Total | ||||||||||||||||||||||||||||||||||
Minimum monthly fees(1) | $ | 70.8 | $ | 29.7 | $ | 14.7 | $ | 4.2 | $ | 1.7 | $ | — | $ | 121.1 | |||||||||||||||||||||||||||
Other(2) | 31.9 | 27.0 | 28.0 | 28.5 | 8.6 | 7.2 | 131.2 | ||||||||||||||||||||||||||||||||||
| Total remaining performance obligations | $ | 102.7 | $ | 56.7 | $ | 42.7 | $ | 32.7 | $ | 10.3 | $ | 7.2 | $ | 252.2 | |||||||||||||||||||||||||||
(1)The transaction price allocated to the remaining performance obligations represents the minimum monthly fees on certain service contracts, including substantive termination penalties that require the counterparty to pay the Company for the aggregate remaining minimum monthly fees upon an early termination for convenience. These obligations will be recognized within account servicing revenue.
(2)Represents deferred revenue and contractual minimums associated with payment processing service obligations. Consideration associated with certain relationships is variable and the measurement and estimation of contract consideration is contingent upon payment processing volumes and maintaining volume shares, among others.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 13, 2026 | Showing above |
| 2024 | Feb 20, 2025 | |
| 2023 | Feb 23, 2024 | |
| 2022 | Feb 28, 2023 | |
| 2021 | Mar 1, 2022 | |
| 2020 | Mar 1, 2021 | |
| 2019 | Feb 28, 2020 | |
| 2018 | Mar 18, 2019 | |
About Revenue Disclosures
Revenue disclosures under ASC 606 explain how a company identifies performance obligations, allocates transaction prices, and determines when revenue is recognized. This section is essential for understanding whether reported revenue reflects genuine economic activity or aggressive accounting choices. Analysts examine the mix of point-in-time versus over-time recognition, which directly affects revenue timing and comparability.
Key signals: rising contract liabilities (deferred revenue) suggest strong future revenue visibility, while declining contract assets may indicate slowing project milestones. Watch for variable consideration estimates — rebates, returns, and performance bonuses that require management judgment. Significant changes in disaggregated revenue by geography or product line can reveal shifting business mix before it appears in headline numbers. Compare revenue growth against contract liability growth to assess sustainability, and scrutinize any changes in the timing of recognition that coincide with earnings pressure.