Shift4 Payments (FOUR, Financial) experienced a significant drop of 18% following its Q4 report. Despite delivering strong EPS results and meeting revenue expectations, the FY25 revenue guidance was softer than anticipated. Additionally, the announcement of a substantial acquisition of Global Blue (GB, Financial) for $7.50 per share in cash, a 15% premium to Tuesday's close, contributed to the stock's decline.

• Q4 results were robust, showing records across key performance indicators such as end-to-end volumes, gross revenue less network fees, adjusted EBITDA, and adjusted free cash flow. End-to-end payment volumes surged 49% year-over-year to $47.9 billion. FY25 revenue guidance lacked detail, but Q1 is on track for expected volume and revenue.
• FOUR expanded into new markets with significant wins, including partnerships with 18 Alterra Mountain Company resorts, ticketing for the IKON Pass, and renewals with Great Wolf Lodge. Additional deals were signed with the NY Yankees, Dallas Mavericks, Portland Trailblazers, and Arizona Diamondbacks.
• The Global Blue acquisition will enhance FOUR's international presence. Global Blue offers payment services, tax refunds, and dynamic currency conversion, operating in 52 countries. The deal is expected to close in Q3.
• Global Blue serves luxury retailers like LVMH, Prada, and Fendi. FOUR sees a $500+ billion payment cross-sell opportunity, with its total cross-sell funnel expanding to over $1.4 trillion post-acquisition.
• This $2.5 billion acquisition, the largest in FOUR's history, will be funded with existing cash and a $1.8 billion short-term bridge financing, to be replaced with long-term debt and convertible financing.

Despite the light FY25 guidance, the primary concern for investors is the Global Blue acquisition. The deal represents FOUR's largest purchase, raising concerns about the price and debt involved. However, FOUR argues that Global Blue is undervalued and will support its geographic expansion. Nonetheless, investors remain cautious about the acquisition's fit and financial implications.