Paysafe Faces Class Action After $13.2M Q3 Credit Loss and $17M Revenue Cut
Paysafe faces a class action over alleged misstatements on banking relationships, reporting Q3 2025 credit loss expense of $13.2 million and write-offs of $9.9 million alongside a $17 million revenue guidance cut. The 2026 outlook aims to grow EBITDA, reduce net leverage below 5x, and align organic and reported growth.
1. Securities Class Action Allegations
Paysafe is confronted with a securities class action filed by investors who acquired shares between March 4, 2025, and November 12, 2025, alleging that statements about its banking relationships and risk management were misleading. Plaintiffs contend that the company’s exposure to higher-risk merchant categories undermined its ability to secure stable bank sponsorships, potentially harming shareholders.
2. Q3 2025 Losses and Guidance Adjustments
In Q3 2025, Paysafe recorded a credit loss expense of $13.2 million, up from $9.0 million in the prior-year quarter, and write-offs of $9.9 million versus $8.4 million a year earlier. The company reduced its full-year revenue guidance by $17 million at the midpoint and cut adjusted EPS guidance by $0.50 at the midpoint, while net loss widened to $87.7 million from $13.0 million.
3. 2026 Growth and Deleveraging Strategy
Paysafe’s 2026 outlook targets convergence of reported and organic growth, underpinned by strong retained earnings. Management plans to drive EBITDA expansion and reduce net leverage to below 5x, strengthening the balance sheet and decreasing reliance on external debt financing.