Verra Mobility reports $28.31 million revenue for Q3 2026

Cover page 18 changes

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x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June September 30, 2026

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

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(Title of Each Class)

Nasdaq Capital Market

(Title of Each Class) (Trading Symbol) (Name of Each Exchange on Which Registered)

Class A Common Stock, par value $0.0001 per share VRRM Nasdaq Capital Market

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES x NO o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T ( 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). YES x NO o

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Non-accelerated filer

Smaller reporting company

Large accelerated filer x Accelerated filer o

Non-accelerated filer o Smaller reporting company o

Emerging growth company o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

In dicate Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b 2 of the Exchange Act). YES o NO x

As of August 3, October 27, 2026, there were 151,982,804 152,009,343 shares of the Company s Class A Common Stock, par value $0.0001 per share, issued and outstanding.

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FOR THE QUARTER ENDED JUNE SEPTEMBER 30, 2026

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Forward-looking statements 5 changes

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customer concentration in our Commercial Services and Government Solutions segments, including risks impacting these segments such as travel demand and legislation, risks relating to our contracts with our significant Commercial Services customers and the New York City Department of Transportation ( NYCDOT ), We announced that which comprises a material portion of our revenue, and the timing of payments. In May 2026, one of our three significant Commercial Services customers had issued a termination notice terminating with respect to its contract with us. that The customer subsequently withdrew the its termination notice in July 2026 and instead entered into a seven-year contract extension on terms that were materially less favorable to us than as compared to the prior agreement, including an option for the customer to modulate its fleet volume. During the third quarter of 2026, the customer significantly reduced its fleet volume under the contract and on October 2, 2026, we exercised our option to terminate the contract, effective January 30, 2027. We may be unable to replace the revenue that was expected under this contract on a timely basis or at all. A second significant Commercial Services customer entered into a five-year contract extension, also on terms materially less favorable terms to us than those of the prior agreement and with fleet volume modulation rights Within the next twelve months, we expect that are subject to engage terms and conditions set forth in contractual renewal discussions the agreement. In addition, the contract with the third significant Commercial Services customer Fluctuations is approaching renewal, and we are following the customer's procurement process. We may not be successful in fleet volume under these arrangements, any failure retaining the contract or may retain it only on terms less favorable to renew us than the third customer's current agreement. If we are not successful in retaining the third customer contract or if any renewal is on less favorable terms or at all, or any future termination than the current agreement and/or if either of any such the remaining contracts could cause our revenue, results of operations, and cash flows to vary from period to period and could is terminated, this would have a material adverse effect on our business, financial condition, and results of operations;

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our ability to successfully improve operational efficiencies, generate cost savings, and achieve expected benefits from our transformation and strategic initiatives, including organizational changes that could result in a change to our segment reporting;

risks related to our ongoing leadership transitions, including the transition to our new President and Chief Executive Officer, our reliance on an interim Chief Financial Officer provided through a third-party engagement and the search for a permanent Chief Financial Officer, and our ability to attract and retain key management personnel;

risks and uncertainties related to litigation, including pending securities litigation, and other disputes and regulatory investigations; and our ability to manage our substantial level of indebtedness.

risks and uncertainties related to our share repurchase program; and our ability to manage our substantial level of indebtedness.

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Financial statements 181 changes

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CONDENSED CONSOLIDA TED BALANCE SHEETS

$ 23.0 million at June 30, 2026 and December 31, 2025, respectively)

Unbilled receivables

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except per share data) September 30,

Cash and cash equivalents $ 136,972 $ 65,272

Restricted cash 3,144 3,046

Accounts receivable (net of allowance for credit losses of $ 20.4 20.7 million and $ 23.0 million at September 30, 2026 and December 31, 2025, respectively)

Unbilled receivables 108,721 56,100

Inventory 21,412 20,662

Prepaid expenses and other current assets 65,313 61,534

Total current assets 527,743 440,902

Installation and service parts, net 38,173 27,081

Property and equipment, net 266,947 208,703

Operating lease assets 43,869 36,359

Intangible assets, net 87,164 168,641

Goodwill 676,789 741,610

Other non-current assets 31,724 22,366

Total assets $ 1,672,409 $ 1,645,662

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Accounts payable $ 132,591 $ 101,813

Deferred revenue 28,863 26,650

Accrued liabilities 80,736 69,851

Tax receivable agreement liability, current portion 5,257 5,257

Current portion of debt 9,506 6,888

Total current liabilities 256,953 210,459

Debt, net of current portion 1,023,056 1,021,157

Operating lease liabilities, net of current portion 45,807 31,338

Tax receivable agreement liability, net of current portion 33,418 38,418

Asset retirement obligations 19,096 17,789

Deferred tax liabilities, net 10,319 16,341

Other long-term liabilities 18,943 17,200

Total liabilities 1,407,592 1,352,702

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Preferred stock, $ 0.0001 par value, 1,000 shares authorized with no shares issued and outstanding at June September 30, 2026 and December 31, 2025

Class A common stock, $ 0.0001 par value, 260,000 shares authorized with 151,981 152,008 and 153,557 shares issued and outstanding at June September 30, 2026 and December 31, 2025, respectively

Additional paid-in capital 542,140 547,274

Accumulated deficit ( 267,736 ) ( 243,759 )

Accumulated other comprehensive loss ( 9,602 ) ( 10,570 )

Total stockholders' equity 264,817 292,960

Total liabilities and stockholders' equity $ 1,672,409 $ 1,645,662

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CONDENSED CONSOLIDATED ST ATEMENTS OF OPERATIONS

AND COMPREHENSIVE (LOSS) INCOME

Three Months Ended June 30,

Six Months Ended June 30,

Cost of product sales

Total costs and expenses

(Loss) income from operations

Interest expense, net

Total other expenses

(Loss) income before income taxes

Income tax provision

Other comprehensive (loss) income:

Total comprehensive (loss) income

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE INCOME

Three Months Ended September 30, Nine Months Ended September 30, (In thousands, except per share data) 2026 2025 2026 2025

Service revenue $ 239,905 $ 243,219 $ 700,007 $ 678,598

Product sales 18,970 18,719 46,027 42,619

Total revenue 258,875 261,938 746,034 721,217

Cost of service revenue, excluding depreciation and amortization 14,888 9,246 36,489 18,658

Cost of product sales 17,638 12,826 39,963 29,804

Operating expenses 90,404 88,036 266,924 243,092

Selling, general and administrative expenses 43,438 47,757 128,281 147,724

Depreciation, amortization and (gain) loss on disposal of assets, net 26,947 29,264 85,405 86,551

Goodwill impairment 64,037

Impairment of intangible assets 40,354

Total costs and expenses 193,315 187,129 661,453 525,829

Income from operations 65,560 74,809 84,581 195,388

Interest expense, net 15,027 16,421 45,920 49,629

Loss on extinguishment of debt 21 69

Other income, net ( 4,744 ) ( 6,298 ) ( 14,878 ) ( 16,410 )

Total other expenses 10,283 10,144 31,042 33,288

Income before income taxes 55,277 64,665 53,539 162,100

Income tax provision 14,889 17,826 34,585 44,347

Net income $ 40,388 $ 46,839 $ 18,954 $ 117,753

Other comprehensive income (loss):

Change in foreign currency translation adjustment 144 ( 790 ) 968 7,723

Total comprehensive income $ 40,532 $ 46,049 $ 19,922 $ 125,476

Net (loss) income per share:

Basic $ 0.27 $ 0.29 $ 0.12 $ 0.74

Diluted $ 0.27 $ 0.29 $ 0.12 $ 0.73

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and 101 more changes in the filing

Note 2: Significant Accounting Policies 16 changes

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Revenue from a single Government Solutions customer exceeded 10 % 10% of total revenue. NYCDOT represented 21.8 24.1 % and 14.7 19.5 % of total revenue for the three months ended June September 30, 2026 and 2025, respectively, and 18.8 20.6 % and 15.0 16.7 % of total revenue for the six nine months ended June September 30, 2026 and 2025, respectively. NYCDOT represented 28.5 11.2 % and 31.1 % of total accounts receivable, net as of June September 30, 2026 and December 31, 2025, respectively. There was also approximately $ 33.1 55.6 million of unbilled revenue related to NYCDOT as of June September 30, 2026. There is no material reserve related to NYCDOT open receivables as amounts are deemed collectible based on current conditions and expe ctations. expectations. No other Government Solutions customer exceeded 10% of total accounts receivable, net as of June September 30, 2026 or December 31, 2025.

Significant customer revenues were generated through three two of the Company s Commercial Services customers, with each exceeding 10 % 10% of total revenue for certain of the periods presented. Commercial Services Customer A represented 11.0 % and 14.7 % was below 10% of total revenue for the three and nine months ended June September 30, 2026 and 2025, respectively, and 12.0 represented 16.2 % and 15.2 15.6 % of total revenue for the six three and nine months ended June September 30, 2026 and 2025, respectively. Commercial Services Customer B represented 12.8 13.9 % and 11.2 11.4 % of total revenue for the three months ended June September 30, 2026 and 2025, respectively, and 12.4 12.9 % and 11.5 % of total revenue for the six nine months ended June September 30, 2026 and 2025, respectively. Commercial Services Customer C represented 10.5 % and 11.0 % was below 10% of total revenue for the three months ended June September 30, 2026 and represented 10.4 % of total revenue for the three months ended September 30, 2025 respectively and 10.3 10.0 % and 10.6 % of total revenue for the six nine months ended June September 30, 2026 and 2025, respectively. No Commercial Services customer exceeded 10 % 10% of total accounts receivable, net as of June September 30, 2026 or December 31, 2025.

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Balance at June 30, 2026

Balance at June 30, 2025

The following presents the activity in the allowance for credit losses by reportable segment for the six nine months ended June September 30, 2026 and 2025, respect ively: respectively:

($ in thousands) Commercial

Balance at January 1, 2026 $ 21,530 $ 386 $ 1,088 $ 23,004

Credit loss expense 13,196 74 566 13,836

Write-offs, net of recoveries ( 16,152 ) ( 2 ) 1 ( 16,153 )

Balance at September 30, 2026 $ 18,574 $ 458 $ 1,655 $ 20,687 ($ in thousands) Commercial

Balance at January 1, 2025 $ 16,038 $ 332 $ 648 $ 17,018

Credit loss expense 17,280 186 911 18,377

Write-offs, net of recoveries ( 11,812 ) ( 133 ) ( 369 ) ( 12,314 )

Balance at September 30, 2025 $ 21,506 $ 385 $ 1,190 $ 23,081 (1) This primarily consists of receivables from drivers of rental cars for which the Company bills on behalf of its customers. Receivables not collected from drivers within a defined number of days are transferred to customers su bject subject to applicable bad debt sharing agreements. The allowance for credit losses for driver-billed receivables was 84 91 % and 85 % of the total Commercial Services allowance for credit losses as of June September 30, 2026 and 2025, respec tively. respectively.

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Deferred revenue represents amounts that have been invoiced in advance and are expected to be recognized as revenue in future periods, and primarily relates to Government Solutions and Parking Solutions customers. As of June September 30, 2026 and December 31, 2025, the Company had approximately $ 9.4 9.3 million and $ 8.9 million of deferred revenue in the Government Solutions segment, respectively. The Company recognized $ 1.4 0.7 million and $ 0.9 million of revenue excluding exchange rate impact during both the three months ended June September 30, 2026 and 2025, respectively, and $ 4.7 5.4 million and $ 5.6 6.5 million of revenue excluding exchange rate impact during the six nine months ended June September 30, 2026 and 2025, respectively, related to amounts that were included in deferred revenue as of December 31, 2025 and 2024. As of June September 30, 2026 and December 31, 2025, the Company had approximately $ 15.1 22.4 million and $ 20.1 million of deferred revenue in the Parking Solutions segment, respectively. The Company recognized $ 6.5 2.7 million and $ 7.8 1.1 million of revenue during the three months ended June September 30, 2026 and 2025, respectively, and $ 15.6 18.3 million and $ 17.8 18.9 million of revenue during the six nine months ended June September 30, 2026 and 2025, respectively, related to amounts that were included in deferred revenue as of December 31, 2025 and 2024.

Remaining performance obligations represent the amount of contracted future revenue not yet recognized as the amounts relate to undelivered performance obligations, including both deferred revenue and non-cancelable contracted amounts that will be invoiced and recognized as revenue in future periods. The Company elected the practical expedients to omit disclosure for the amount of the transaction price allocated to remaining performance obligations with an enforceable contract term of one year or less and the amount that relates to variable consideration allocated to a wholly unsatisfied performance obligation to transfer a distinct good or service within a series of distinct goods or services that form a single performance obligation. As of June September 30, 2026, total transaction price allocated to performance obligations in the Government Solutions segment that were unsatisfied or partially unsatisfied was $ 199.6 187.0 million, of which $ 82.7 81.9 million is expected to be recognized as revenue in the next twelve months and the rest over the remaining performance obligation period.

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Note 3: Prepaid Expenses and Other Current Assets 9 changes

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($ in thousands) September 30,

Prepaid services $ 22,576 $ 22,925

Prepaid tolls 13,190 8,425

Income taxes receivable 9,604 14,213

Deposits 5,404 3,113

Short term investments 4,418

Prepaid insurance 2,574 1,761

Costs to fulfill a customer contract 1,475 761

Total prepaid expenses and other current assets $ 65,313 $ 61,534

Note 4: Goodwill and Intangible Assets 22 changes

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The Company first evaluated the recoverability of its long-lived asset groups by comparing the carrying amount of each asset group with the estimated undiscounted cash flows expected to be generated by the asset group. The estimated undiscounted cash flows of the Parking Solutions asset groups, consisting of customer relationships, trademark and developed technology, were less than its carrying amount. Accordingly, the Company measured the asset group at fair value and recognized a $ 40.4 million impairment of intangible assets during the three and six nine months ended June September 30, 2026, primarily allocated to customer relationships. The impairment loss is presented separately within impairment of intangible assets on the condensed consolidated statements of operations. The Company did not identify an impairment of the long-lived asset groups associated with its other reporting units.

After recognizing the long-lived asset impairment and related deferred-tax effects, the Company performed quantitative goodwill impairment tests for each of its reporting units. The estimated fair values of the Commercial Services, Government Solutions North America and Government Solutions International reporting units exceeded their respective carrying amounts, and no goodwill impairment was recognized for those reporting units. The estimated fair value of the Parking Solutions reporting unit was less than its carrying amount. Accordingly, the Company recognized a $ 64.0 million goodwill impairment during the three and six nine months ended June September 30, 2026, which is presented separately within goodwill impairment on the condensed consolidated statements of operations.

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Balance at June 30, 2026

($ in thousands) Commercial

Balance at December 31, 2025 $ 425,231 $ 214,313 $ 102,066 $ 741,610

Goodwill impairment ( 64,037 ) ( 64,037 )

Foreign currency translation adjustment ( 1,270 ) 486 ( 784 )

Balance at September 30, 2026 $ 423,961 $ 214,799 $ 38,029 $ 676,789

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Customer relationships

Developed technology

Amortization expen se was $ 14.3 million and $ 16.4 million for the three months ended June 30, 2026 and 2025, respectively, and was $ 29.9 mil lion and $ 33.1 million for the six months ended June 30, 2026 and 2025, respectively.

September 30, 2026 December 31, 2025

($ in thousands) Gross

Trademarks $ 4,232 $ 2,801 $ 4,822 $ 2,484

Patent 500 292 500 217

Customer relationships 523,344 449,405 559,256 412,488

Developed technology 36,348 24,762 40,656 21,404

Gross carrying value of intangible assets 564,424 $ 477,260 605,234 $ 436,593

Less: accumulated amortization ( 477,260 ) ( 436,593 )

Intangible assets, net $ 87,164 $ 168,641

Amortization expense was $ 11.6 million and $ 15.6 million for the three months ended September 30, 2026 and 2025, respectively, and was $ 41.5 million and $ 48.7 million for the nine months ended September 30, 2026 and 2025, respectively.

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Remainder of 2026 $ 11,352

Note 5: Accrued Liabilities 10 changes

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($ in thousands) September 30,

Accrued salaries and wages $ 27,387 $ 41,050

Accrued customer consideration 20,000

Accrued interest payable 9,157 4,204

Current portion of operating lease liabilities 6,705 6,750

Income taxes payable 5,522 3,278

Advanced deposits 3,491 3,270

Self-insurance liability 2,719 1,796

Restricted cash due to customers 2,718 2,616

Total accrued liabilities $ 80,736 $ 69,851

Note 6: Debt, Net 20 changes

The following table provides a summary of the Compan y Company s debt, net at:

($ in thousands) September 30,

Amended Term Loan $ 681,916 $ 687,082

Senior Notes 350,000 350,000

Less: original issue discounts ( 1,948 ) ( 2,193 )

Less: unamortized deferred financing costs ( 5,810 ) ( 6,844 )

Total debt, net 1,032,562 1,028,045

Less: current portion of debt ( 9,506 ) ( 6,888 )

Total debt, net of current portion $ 1,023,056 $ 1,021,157

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The Amended Term Loan bears interest at a per annum rate equal to Secured Overnight Financing Rate (" SOFR ") plus an applicable margin of 2.00 %, or a base rate plus an applicable margin of 1.00 %. As of June September 30, 2026, the interest rate on the Amended Term Loan was 5.6 5.9 %. The Amended Term Loan amortizes in equal quarterly installments in aggregate amounts equal to 1.00 % of the original principal amount of the Amended Term Loan beginning March 31, 2026, with the balance payable at maturity, is subject to mandatory prepayment provisions upon the occurrence of certain specified events, and is repayable at any time at the borrowers election. The Company evaluated the refinancing transactions on a lender-by-lender basis and accounted accordingly for debt extinguishment and debt modification costs (for the portion of the transactions that did not meet the accounting criteria for debt extinguishment).

During the six nine months ended June September 30, 2026, the Company made quarterly repayments totaling $ 3.4 m illion 5.2 million on the Amended Term Loan. During the six nine months ended June September 30, 2025, the Company made voluntary prepayments totaling $ 4.5 6.8 million on the 2021 Term Loan. As a result, the total principal outstanding was $ 683.6 681.9 million a s as of June September 30, 2026.

The Company r ecorded recorded less than $ 0.1 million of loss on extinguishment of debt during both the three and six nine months ended June September 30, 2025, related to the write-off of pre-existing deferred financing costs and discounts in connection with the early repayments. .

In addition, the Amended Term Loan requires mand atory mandatory prepayments equal to the product of the excess cash flows of the Company (as defined in the Amended and Restated Term Loan Agreement) and the applicable prepayment percentages (calculated as of the last day of the fiscal year), as set forth in the following table:

Consolidated First Lien Net Leverage Ratio (As Defined in the Amended and Restated Term Loan Agreement) Applicable

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Outstanding borrowings under the Amended Revolver accrue interest at per annum rate equal to SOFR plus a margin ranging from 1.25 % to 1.75 % or a base rate plus a margin ranging from 0.25 % to 0.75 %, in each case, depending on the quarterly average undrawn availability under the Amended Revolver in the prior quarter. The Amended and Restated Revolving Credit Agreement also provides for the option, subject to receiving additional commitments from lenders and the satisfaction of certain conditions, to increase the loan commitments under the Amended Revolver by up to an amount equal to the greater of (x) $ 75.0 million and (y) the amount by which the borrowing base exceeds the aggregate commitments at such time. There were no outstanding borrowings on the Amended Revolver as of June September 30, 2026 or December 31, 2025. The availability to borrow was $ 115.4 127.3 million at June September 30, 2026, calculated as the Company's borrowing base which consists of certain eligible accounts receivable and inventory balances, less any outstanding borrowings and letters of credit up to the maximum commitment available.

A commitment fee on the unused portion of the Amended Revolver is payable quarterly at (x) an annual rate of 0.375 %, when quarterly average usage was less than 50 % of the loan commitments in the prior quarter or (y) an annual rate of 0.250 %, when quarterly average usage of the Amended Revolver was greater than or equal to 50 % of the loan commitments in the prior quarter. The Company is also required to pay participation and fronting fees at 1.38 % on $ 3.7 4.9 million of outstanding letters of credit as of June September 30, 2026.

All borrowings and other extensions of credits under the Amended Term Loan, Senior Notes and the Amended Revolver are subject to the satisfaction of customary conditions and restrictive covenants including absence of defaults and accuracy in material respects of representations and warranties. Substantially all of the Company s assets are pledged as collateral under the Amended Term Loan and the Amended Revolver. At June September 30, 2026, the Company was compliant with all debt covenants in its debt agreements.

From time to time, the Company enters into equipment financing arrangements in the normal course of business, including certain equipment leases and purchases accounted for as financing arrangements. Amounts outstanding under these arrangements are included in "Other debt" in the table above and were not material to the Company s overall financial position, liquidity, or capital resources as of June September 30, 2026.

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The Company recorded interest expense, including amortization of deferred financing costs and discounts, of $ 15.5 15.0 million and $ 16.6 16.4 million for the three months ended June September 30, 2026 and 2025, respectively, and $ 30.9 45.9 million and $ 33.2 49.6 million for the six nine months ended June September 30, 2026 and 2025, respectively.

The weighted average effective interest rate on the Company s outstanding borrowings was 5.6 5.8 % as of both June September 30, 2026 and 5.6 % as of December 31, 2025.

Note 7: Fair Value of Financial Instruments 12 changes

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Hierarchy September 30, 2026 December 31, 2025

($ in thousands) Carrying

Term Loan 2 $ 675,990 $ 661,459 $ 680,339 $ 692,235

Senior Notes 2 348,230 322,875 347,706 346,500

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As a result of a legal settlement finalized in February 2026, the Company received ordinary shares of a publicly traded company based in Australia. The shares are classified as short-term investments within the prepaid expenses and other current assets line on the condensed consolidated balance sheets and are measured at fair value on a quarterly basis. The fair value of these shares is determined using quoted closing market prices on the Australian Securities Exchange, an active exchange, as of the measurement date. Accordingly, the investment is classified within Level 1 of the fair value hierarchy. The following summarizes the change in fair value of equity securities included in selling, general and administrative expenses on the condensed consolidated statements of operations and comprehensive (loss) income which consists of adjustments related to the equity securities re-measured to fair value at the end of the reporting period:

($ in thousands) Three Months Ended

September 30, 2026 Nine Months Ended

Beginning balance $ 5,237 $

Equity securities acquired from legal settlement 7,865

Change in fair value of equity securities ( 819 ) ( 3,447 )

Ending balance $ 4,418 $ 4,418

The Company has an equity investment measured at cost with a carrying value of $ 2.1 million and $ 2.0 million as of June September 30, 2026 and December 31, 2025, respectively, and is only adjusted to fair value if there are identified events that would indicate a need for an upward or downward adjustment or changes in circumstances that may indicate impairment. The estimation of fair value requires the use of significant unobservable inputs, such as voting rights and obligations in the securities held, and is therefore classified within Level 3 of the fair value hierarchy. There were no identified events that required a fair value adjustment during the six nine months ended June September 30, 2026 and 2025.

Note 9: Income Taxes 6 changes

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1 0. Stockholders Equity

Share Repurchases and Retirement

In October 2023, the Company s Board of Directors authorized a share repurchase program for up to an aggregate amount of $ 100.0 million of its outstanding shares of Class A common stock, par value $ 0.0001 (the Class A Common Stock ), over an 18-month period. After the Company repurchased an aggregate 3.5 million shares for approximately $ 87.3 million in fiscal year 2024, in December 2024, the Company s Board of Directors authorized the repurchase of up to an additional $ 100.0 million of its outstanding shares under the then-existing program, providing the Company with approximately $ 112.7 million available for repurchases. In December 2024, the Company entered into an accelerated share repurchase agreement ( ASR ) with a third-party financial institution and paid $ 112.7 million to receive an initial delivery of 3,821,958 shares of its Class A Common Stock. The final settlement occurred on March 3, 2025, at which time, the Company received an additional 685,934 shares of Class A Common Stock calculated using a volume-weighted average price over the term of the ASR agreement. In connection with the settlement, the Company reduced the par value from common stock and $ 2.4 million from additional paid-in capital calculated using an average share price, with an offset of $ 2.4 million to accumulated deficit on the condensed consolidated statements of stockholders equity. All repurchased shares were subsequently retired. The prior repurchase authorization expired on April 30, 2025.

In May 2025, the Company s Board of Directors authorized a new share repurchase program for up to an aggregate amount of $ 100.0 million of the Company s outstanding shares of Class A Common Stock over an 18-month period. On October 23, 2025, the Company s Board of Directors authorized the repurchase of up to an additional $ 150.0 million of the Company s outstanding shares of Class A Common Stock under the existing May 2025 program, providing the Company with $ 250.0 million available for repurchases. During the fourth quarter of fiscal year 2025, the Company paid $ 133.4 million to repurchase 6,028,853 shares of its Class A Common Stock through open market transactions, which shares it subsequently retired.

During the six months ended June 30, 2026, the Company paid $ 50.2 million to repurchase 2,215,800 shares of its Class A Common Stock through open market transactions, which shares it subsequently retired. In addition, the Company recorded approximately $ 0.5 million within accrued liabilities on the condensed consolidated balance sheets as of June 30, 2026 for direct costs related to the excise tax payable on net share repurchases. During the six months ended June 30, 2026, the Company made approximately $ 1.4 million of excise tax payments. In connection with these repurchases, the Company reduced the par value from common stock and $ 7.8 million from additional paid-in capital calculated using an average share price, and by increasing accumulated deficit for the remaining cost of $ 42.4 million. As of June 30, 2026, $ 66.3 million remains available under the Company s authorized share repurchase program.

The Company s effective income tax rate was ( 14.1 26.9 % and 26.7 27.6 % for the three months ended June September 30, 2026 and 2025, respectively, and ( 1,133.5 64.6 % and 27.2 27.4 % for the six nine months ended June September 30, 2026 and 2025, re spectively. respectively. The decrease increase in effective tax rate for the nine months ended September 30, 2026, was primarily driven by the goodwill impairment recorded for the six nine months ended June September 30, 2026, which is not deductible for tax purposes.

Note 11: Stock-Based Compensation 6 changes

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Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30, ($ in thousands) 2026 2025 2026 2025

Operating expenses $ 1,522 $ 1,452 $ 4,588 $ 4,053

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Total stock-based compensation expense

Total stock-based compensation expense $ 721 $ 4,961 $ 7,868 $ 18,696 (1) Credit to selling, general and administrative expenses is related to the reversal of unvested share-based compensation as a result of executive leadership transition.

Note 12: Tax Receivable Agreement 1 change

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At Ju ne September 30, 2026, the TRA liability was $ 38.7 million of which approximately $ 5.3 million was the current portion and $ 33.4 million was the non-current portion, both of which are included in the respective tax receivable agreement liability line items on the condensed consolidated balance sheets. During the second quarter of nine months ended September 30, 2026, the Company made an estimated a payment of $ 5.0 million related to the 2025 tax year.

Note 13: Commitments and Contingencies 1 change

The Company has issued various letters of credit under contractual arrangements with certain of its domestic and international vendors and customers. Outstanding letters of credit under these arrangem ents arrangements totaled $ 3.7 mil lion 4.9 million at June September 30, 2026. Additionally, the Company ha d had $ 2.3 mill ion million of bank guarantees at June September 30, 2026 required to support bids and contracts with certain international customers.

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Legal proceedings 103 changes

We are subject to legal and regulatory actions that arise from time to time in the ordinary course of business, and may be subject to similar or other claims in the future. Legal disputes and other claims and proceedings may relate to, among other things, intellectual property, commercial arrangements, negligence and fiduciary duty claims, vicarious liability based on conduct of individuals or entities outside of our control, including our third-party service providers, antitrust claims, deceptive trade practices, general fraud claims, and employment law claims, including compliance with wage and hour regulations. In addition to more general litigation, at times we have also been a named party in claims made against our customers, including putative class actions challenging the legality and constitutionality of automated photo enforcement and other similar programs of our Government Solutions customers, and consumer fraud claims brought against us and our Commercial Services customers alleging faulty disclosures regarding our services. From time to time, we may also be reviewed or investigated by U.S. federal, state, or local regulators, or regulators in the foreign jurisdictions in which we operate regarding these and other matters, including proper licensing and tax assessments. All litigation is inherently unpredictable and we could incur judgments or enter into settlements or claims in the future that could materially impact our results.

When necessary, we accrue estimated amounts related to legal proceedings within accrued liabilities on the condensed consolidated balance sheets. The information contained in Note 13, Commitments and Contingencies , included in Part I, Item 1 of this Quarterly Report on Form 10-Q is incorporated herein by reference.

Except as otherwise noted above, there have been no material developments in legal proceedings. For previously reported information about legal proceedings refer to Part I, Item 3, Legal Proceedings, of our Annual Report on Form 10-K for the year ended December 31, 2025, and Part II, Item 1, in our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2026.

It em 1A. Risk Factors

Part I, Item 1A. Risk Factors in our Annual Report includes a discussion of our risk factors. Other than the risk factors below, there have been no material changes from the risk factors described in our Annual Report. We may disclose changes to such risk factors or disclose additional risk factors from time to time in our future SEC filings.

Our Commercial Services and Government Solutions segments have several large customers that account for a significant portion of our revenue, and a reduction in demand, materially less favorable terms or pricing in new or amended agreements as compared to the current agreements, or the loss, even temporarily, of one or more of such customers has and could have in the future a material adverse effect on our business.

Our business experiences varying levels of customer concentration. For example, in our Government Solutions segment, NYCDOT represented approximately 21.8% and 14.7% of our total revenues for the quarters ended June 30, 2026 and 2025, respectively. We entered into a new contract with NYCDOT, effective January 1, 2026, to manage New York City s automated enforcement camera safety programs for a five-year period. The terms of the new contract are materially different than our prior contract with NYCDOT, including service level agreements, service credits, liquidated damages, cybersecurity, and subcontracting requirements. If we do not successfully perform the contract pursuant to its terms, it could have a material adverse effect on our business, financial condition, and results of operations. We may continue to rely on a small number of customers in our Government Solutions segment to represent a significant portion of our total revenues in any given period. The loss of any of our top Government Solutions customers could have a material adverse effect on our business, financial condition, and results of operations.

We also experience customer concentration in our Commercial Services segment. Three of our Commercial Services customers collectively accounted for 34.3% and 36.9% of our total revenues for the quarters ended June 30, 2026 and 2025, respectively. We face risks associated with the renewal of Commercial Services customer agreements. We announced that one of our three significant Commercial Services customers had issued a notice terminating its contract with us; that customer subsequently withdrew the notice and entered into a seven-year contract extension on terms materially less favorable to us than the prior agreement, including an option for the customer to modulate its fleet volume. A second significant Commercial Services customer entered into a five-year extension, with options to extend, also on materially less favorable terms than the prior agreement and with fleet volume modulation rights. Within the next twelve months, we expect to engage in contractual renewal discussions with a third significant Commercial Services customer.

Fluctuations in fleet volume under these arrangements could cause our revenue, results of operations, and cash flows to vary from period to period and could have a material adverse effect on our business, financial condition, and results of operations. Additionally, any failure to renew the third customer's agreement on favorable terms or at all or any future termination of such contracts could have a material adverse effect on our business, financial condition, and results of operations.

We are currently conducting a search for a new permanent CEO and managing our CEO transition with interim leadership. We depend on the services of key executives and any inability to attract and retain key management personnel could have a material adverse effect on our business.

We believe that our future success depends upon the services of our executive management team, who have critical experience and relationships that we rely on to implement our business plan and growth strategy. From time to time, there have been and may be future changes in our executive management team resulting from the hiring or departure of these executives. Following the recent departure of our Chief Executive Officer, we are currently operating under the leadership of an Interim Chief Executive Officer while our board of directors conducts a search for a permanent successor. We cannot predict how long this search process will take, whether it will result in the identification and successful onboarding of a qualified permanent candidate, or whether such a candidate will be selected from inside or outside the Company. Effective succession planning and leadership transitions are complex undertakings, and any delay in appointing a permanent Chief Executive Officer, or any perception by employees, customers, investors, or other stakeholders that our leadership is unstable, could adversely affect our business.

Additionally, as our business grows, we may need to attract and hire additional management personnel. We have employment agreements with some members of senior management that include non-competition provisions; however, we cannot prevent our executives from terminating their employment and may not be able to fully enforce non-competition provisions limiting former executives or key personnel from competing with us following any departure. Moreover, we do not carry key-man life insurance on the lives of our executive officers, employees, or advisors. Our ability to retain our key management personnel or to identify and attract additional management personnel or suitable replacements is dependent on a number of factors, including the competitive nature of the employment market and our industry. Any failure to retain key management personnel or to attract additional or suitable replacement personnel has and in the future could cause uncertainty among investors, employees, customers, and others concerning our future direction and performance and could have a material adverse effect on our business, financial condition, and results of operations.

Our goodwill and intangible assets have been subject to impairment and may be subject to further impairment in the future, which could have a material adverse effect on our results of operations, financial condition, or future operating results.

We perform a goodwill and long-lived asset impairment test for each reporting unit annually, or more frequently if indicators for potential impairment exist. Indicators that are considered include significant changes in performance relative to expected operating results, significant negative industry or economic trends, or a significant decline in our stock price, and/or market capitalization for a sustained period of time. In addition, we assess the current and future economic outlook for our reporting units during the fiscal year. While we believe the assumptions used in determining whether there was impairment and the amount of any resulting impairment were reasonable and commensurate with the views of a market participant, changes in key assumptions in the future, including increasing the discount rate, lowering forecasts for revenue and operating margin, customer attrition, or lowering the long-term growth rate, could result in additional charges; similarly, one or more changes in these assumptions in future periods due to changes in circumstances could result in future impairments in one or more reporting units. We recognized a $40.4 million impairment of customer relationship, trademark and developed technology intangible assets during the three and six months ended June 30, 2026 in connection with our assessment that the estimated undiscounted cash flows of the Parking Solutions asset group were less than its carrying amount. We also recorded a $64.0 million impairment to goodwill in our Parking Solutions segment during the three and six months ended June 30, 2026 in connection with our assessment that the Parking Solutions reporting unit s carrying value exceeded the estimated fair value and we cannot predict if or when additional future goodwill impairments may occur. Any future goodwill impairments could have material adverse effects on our operating income, net assets, or our cost of, or access to, capital, which could harm our business. See Note 4, Goodwill and Intangible Assets , in Part I, Item 1, Financial Statements, for additional information.

We are subject to securities litigation, which is expensive and could adversely impact our business.

In June 2026, a putative securities class action complaint was filed against us and certain of our officers. The case is pending. See Note 13, Commitments and Contingencies, included in Part I, Item 1, Financial Statements in this Report for more information. Litigation of this type is expensive and could result in substantial cost and divert resources from our business regardless of the outcome of such litigation, which could have an adverse effect on our business, financial condition, results of operations or prospects. Any adverse determination in litigation could also subject us to significant liabilities.

The Company is subject to legal and regulatory actions that arise from time to time in the ordinary course of business. The Company records a liability when it believes it is probable a loss will be incurred, and the amount of loss or range of loss can be reasonably estimated. The assessment as to whether a loss is probable, reasonably possible or remote, and as to whether a loss or a range of such loss is estimable, often involves significant judgment about future events. When necessary, the Company accrues estimated amounts related to legal proceedings within accrued liabilities on the condensed consolidated balance sheets. The ultimate cost of litigation or settlement could be materially different than the amount of the current estimates and accruals and could have a material adverse impact on the Company s consolidated financial position, results of operations, or cash flows.

On June 4, 2026, a putative securities class action was filed in the United States District Court for the District of Arizona, captioned Otucu v. Verra Mobility Co., et al., on behalf of a putative class of investors who purchased the Company's common stock between February 24, 2026 and May 26, 2026. The complaint alleges violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and seeks an unspecified amount of damages on behalf of investors that purchased or otherwise acquired Company common stock between February 24, 2026 and May 26, 2026. The complaint alleges that defendants materially misled the putative class with respect to the Company s statements regarding contract renewal negotiations with a Commercial Services customer and guidance with respect to full year 2026. The Company intends to defend this matter vigorously. The Company has not recorded any loss or gain contingencies associated with this matter as it is not probable or reasonably estimable at June September 30, 2026.

14. Segment Reporting

The Company has three operating and reportable segments: Commercial Services, Government Solutions, and Parking Solutions. Commercial Services offers toll and violation management solutions and title and registration services to RACs, Direct Fleets, FMCs, and other large fleet owners. Government Solutions offers photo enforcement automated safety solutions and services to states, municipalities, counties, school districts, and law enforcement agencies of all sizes. Parking Solutions provides an integrated suite of parking software, transaction processing and hardware solutions to its customers.

The operating and reportable segments were determined based on how the Company s Chief Operating Decision Maker ( CODM ) regularly reviews the operating results of the various components of the Company for which discrete financial information is available, including based on the nature of the products and services and the type of customer. The Company defines the CODM as its Chief Executive Officer. The Company s CODM primarily uses actual revenues and segment profit (defined below) as compared to previously budgeted amounts to evaluate the operating performance, allocate resources, and deploy capital to the segments.

Segment performance is based on revenues and income from operations before depreciation, amortization, and stock-based compensation. The measure also excludes interest expense, net, income taxes and certain other transactions and is inclusive of other income, net. The tables below refer to this measure as segment profit. The aforementioned items are not indicative of operating performance, and, as a result, are not included in the measures that are reviewed by the CODM for the segments. Other income, net included in segment profit below consists primarily of credit card rebates earned on the prepayment of tolling transactions and gains or losses on foreign currency transactions and excludes certain non-operating expenses inapplicable to segments.

The CODM does not use discrete asset information to evaluate operating performance at the segment level, and as such, the Company has not reported assets disaggregated by reportable segment.

The following tables set forth financial information by segment for the respective periods:

For the Three Months Ended September 30, 2026

($ in thousands) Commercial

Service revenue $ 100,333 $ 122,463 $ 17,109 $ 239,905

Product sales 14,382 4,588 18,970

Total revenue 100,333 136,845 21,697 258,875

Cost of service revenue, excluding depreciation and amortization 575 10,031 4,282 14,888

Cost of product sales 13,878 3,760 17,638

Operating expenses 25,304 58,847 4,731 88,882

Selling, general and administrative expenses 17,643 14,593 5,327 37,563

Loss (gain) on disposal of assets, net 733 ( 8 ) 725

Other (income) expense, net ( 4,517 ) ( 356 ) 116 ( 4,757 )

Segment profit $ 61,328 $ 39,119 $ 3,489 $ 103,936

Interest expense, net 15,027

Other reconciling items (1)

Income before income taxes $ 55,277

(1) This consists of depreciation and amortization expense, stock-based compensation, and other costs to reconcile to total income before income taxes.

For the Three Months Ended September 30, 2025

($ in thousands) Commercial

Service revenue $ 117,296 $ 108,293 $ 17,630 $ 243,219

Product sales 14,267 4,452 18,719

Total revenue 117,296 122,560 22,082 261,938

Cost of service revenue, excluding depreciation and amortization 624 4,200 4,422 9,246

Cost of product sales 9,484 3,342 12,826

Operating expenses 26,417 55,968 4,199 86,584

Selling, general and administrative expenses 18,036 21,095 6,374 45,505

Loss on disposal of assets, net 7 723 730

Other income, net ( 6,072 ) ( 221 ) ( 5 ) ( 6,298 )

Segment profit $ 78,284 $ 31,311 $ 3,750 $ 113,345

Interest expense, net 16,421

Loss on extinguishment of debt 21

Other reconciling items (1)

Income before income taxes $ 64,665

(1) This consists of depreciation and amortization expense, stock-based compensation, and other costs to reconcile to total income before income taxes.

For the Nine Months Ended September 30, 2026

($ in thousands) Commercial

Service revenue $ 313,201 $ 335,586 $ 51,220 $ 700,007

Product sales 35,103 10,924 46,027

Total revenue 313,201 370,689 62,144 746,034

Cost of service revenue, excluding depreciation and amortization 1,506 23,687 11,296 36,489

Cost of product sales 30,001 9,962 39,963

Operating expenses 72,181 175,461 14,694 262,336

Selling, general and administrative expenses 53,015 50,244 16,847 120,106

Loss on disposal of assets, net 2 1,420 5 1,427

Other (income) expense, net ( 13,840 ) ( 1,219 ) 157 ( 14,902 )

Segment profit $ 200,337 $ 91,095 $ 9,183 $ 300,615

Interest expense, net 45,920

Goodwill impairment 64,037

Impairment of intangible assets 40,354

Other reconciling items (1)

Income before income taxes $ 53,539

(1) This consists of depreciation and amortization expense, stock-based compensation, and other costs to reconcile to total income before income taxes.

For the Nine Months Ended September 30, 2025

($ in thousands) Commercial

Service revenue $ 327,735 $ 300,246 $ 50,617 $ 678,598

Product sales 31,236 11,383 42,619

Total revenue 327,735 331,482 62,000 721,217

and 23 more changes in the filing

MD&A 206 changes

6 unchanged paragraphs

In connection with the executive leadership and organizational realignment described under Recent Events , we are evaluating the effect of changes to our organizational structure and internal management reporting on the identification of our operating and reportable segments. We continue to report three operating and reportable segments for the periods presented. Depending on how the organizational and internal management reporting changes affect the financial information regularly reviewed by our chief operating decision maker the Company's Interim Chief Executive Officer, into in assessing performance and allocating resources, the evaluation could result in a change to our segment reporting in a future period, including reporting as a single operating and reportable segment. Any such change would be reflected beginning in the period in which the change becomes effective, with prior-period segment information recast as required.

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Increased total revenue by $27.9 $24.8 million, or 6.1%, 3.4%, from $459.3 $721.2 million in the six nine months ended June September 30, 2025 to $487.2 $746.0 million in the same period in 2026. The increase was mainly due to installation revenue from the NYCDOT program, and expansion in speed, bus lane, school bus, red light, school bus and other services and installation revenue from the NYCDOT program in the Government Solutions segment.

Generated cash flows from operating activities of $97.2 $211.8 million and $138.1 $215.8 million for the six nine months ended June September 30, 2026 and 2025, respectively. Our cash on hand was $49.6 $137.0 million as of June September 30, 2026.

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On June 1, 2026, we announced that David Roberts had departed as our President and Chief Executive Officer and as a member of our Board of Directors. The Board appointed Jon Keyser, previously our Chief Transformation Officer and Executive Vice President and Chief Legal Officer, as Interim President and Chief Executive Officer and retained an executive search firm to assist with a comprehensive search for a permanent successor.

On June 1, 2026, we announced that David Roberts had departed as our President and Chief Executive Officer and as a member of the Board. The Board appointed Jon Keyser, previously our Chief Transformation Officer and Executive Vice President and Chief Legal Officer, as Interim President and Chief Executive Officer. On September 30, 2026, we announced that Jon Newhard was appointed by the Board as President and Chief Executive Officer effective November 1, 2026. On October 2, 2026, we entered into a Separation, Transition and Release Agreement (the "Separation Agreement") with Mr. Keyser. Under the Separation Agreement, Mr. Keyser s last day of work as our Interim President and Chief Executive Officer will be October 31, 2026, he will resign from all officer and director positions with us and our subsidiaries and affiliates effective November 1, 2026, and he will continue as a full-time employee in the role of Special Advisor through December 31, 2026 to support the Company and the Chief Executive Officer leadership transition.

On October 15, 2026, we announced that Craig Conti will resign as our Executive Vice President and Chief Financial Officer, effective November 4, 2026, to pursue another opportunity in a different industry. Mr. Conti s decision was not related to our financial or operating results or to any disagreement with us regarding our financial, operational, accounting or reporting policies or practices. The Board has retained an executive search firm to conduct a comprehensive search for a permanent Chief Financial Officer. On October 29, 2026, the Board appointed Matthew Kvarda, a Managing Director with Alvarez & Marsal North America, LLC ( A&M ), as Interim Chief Financial Officer and principal financial officer, effective November 5, 2026, to serve in such role until a permanent Chief Financial Officer is appointed. Mr. Kvarda s services will be provided pursuant to an engagement letter between the Company and A&M.

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We announced that one of our three significant Commercial Services customers had issued a notice terminating its contract with us; that customer subsequently withdrew the notice and entered into a seven-year contract extension on terms materially less favorable to us than the prior agreement, including an option for the customer to modulate its fleet volume. A second significant Commercial Services customer entered into a five-year extension, with options to extend, also on materially less favorable terms than the prior agreement and with fleet volume modulation rights. Within the next twelve months, we expect to engage in contractual renewal discussions with a third significant Commercial Services customer.

Fluctuations in fleet volume under these arrangements could cause our revenue, results of operations, and cash flows to vary from period to period and could have a material adverse effect on our business, financial condition, and results of operations. Additionally, any failure to renew the third customer's agreement on favorable terms or at all or any future termination of such contracts could have a material adverse effect on our business, financial condition, and results of operations.

In May 2026, one of our three significant Commercial Services customers issued a termination notice with respect to its contract with us. The customer subsequently withdrew its termination notice in July 2026 and entered into a seven-year contract extension on terms that were materially less favorable to us as compared to the prior agreement, including an option for the customer to modulate its fleet volume. During the third quarter of 2026, the customer significantly reduced its fleet volume under the contract and on October 2, 2026, we exercised our option to terminate the contract, effective January 30, 2027. We may be unable to replace the revenue that was expected under this contract on a timely basis or at all. A second significant Commercial Services customer entered into a five-year contract extension, also on terms materially less favorable to us than those of the prior agreement and with fleet volume modulation rights that are subject to terms and conditions set forth in the agreement.

In addition, the contract with the third significant Commercial Services customer is approaching renewal, and we are following the customer's procurement process. We may not be successful in retaining the contract or may retain it only on terms less favorable to us than the current agreement. If we are not successful in retaining the third customer contract or if any renewal is on less favorable terms than the current agreement and/or if either of the remaining contracts is terminated, this would have a material adverse effect on our business, financial condition, and results of operations. See Part II, Item 1A, Risk Factors for additional information.

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We recorded a $64.0 million impairment to goodwill in our Parking Solutions segment during the six nine months ended June September 30, 2026, which is presented in a separate line item on the condensed consolidated statements of operations. This was in connection with our 2026 assessment of goodwill impairment where the Parking Solutions reporting unit's carrying value exceeded the estimated fair value. As part of this assessment, we determined that the carrying value of certain intangibles within the Parking Solutions segment were not recoverable and recorded a $40.4 million impairment to intangibles in our Parking Solutions segment during the six nine months ended June September 30, 2026, which is presented in a separate line item on the condensed consolidated statements of operations. Refer to Note 4, Goodwill and Intangible Assets , in Part I, Item 1, Financial Statements, for additional information.

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We monitor the U.S. Transportation and Security Administration (the TSA ) passenger volume ( TSA Passenger Volume ) as one of several measures for Commercial Services revenue growth. TSA Passenger Volume measures the number of passengers screened by the TSA at United States airports, which correlates to the number of vehicles rented by travelers and toll road usage. TSA Passenger Volume in the second third quarter of 2026 was approximately 1% 3% less than TSA Passenger Volume for the same period in 2025.

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Three Months Ended June September 30, 2026 Compared to Three Months Ended June September 30, 2025

1 unchanged paragraph

Cost of product sales

Selling, general and administrative expenses

Impairment of intangible assets

Total costs and expenses

(Loss) income from operations

Interest expense, net

Total other expenses

(Loss) income before income taxes

Income tax provision

Government Solutions

Total service revenue

Commercial Services service revenue increased by $6.0 million, or 5.5%, from $109.1 million for the three months ended June 30, 2025 to $115.1 million for the three months ended June 30, 2026. The increase was primarily due to increased product adoption and tolling activity compared to the prior year which contributed to a $4.1 million growth in RAC tolling revenue, with the remainder primarily driven by higher violations processing compared to the same period in 2025.

Government Solutions

Operating expenses by segment

Total operating expenses

Three Months Ended June September 30,

Percentage of Revenue Increase (Decrease)

($ in thousands) 2026 2025 2026 2025 $ %

Service revenue $ 239,905 $ 243,219 92.7 % 92.9 % $ (3,314) (1.4) %

Product sales 18,970 18,719 7.3 % 7.1 % 251 1.3 %

Total revenue 258,875 261,938 100.0 % 100.0 % (3,063) (1.2) %

Cost of service revenue, excluding depreciation and amortization 14,888 9,246 5.8 % 3.5 % 5,642 61.0 %

Cost of product sales 17,638 12,826 6.8 % 4.9 % 4,812 37.5 %

Operating expenses 90,404 88,036 34.9 % 33.6 % 2,368 2.7 %

Selling, general and administrative expenses 43,438 47,757 16.8 % 18.2 % (4,319) (9.0) %

Depreciation, amortization and (gain) loss on disposal of assets, net 26,947 29,264 10.4 % 11.2 % (2,317) (7.9) %

Total costs and expenses 193,315 187,129 74.7 % 71.4 % 6,186 3.3 %

Income from operations 65,560 74,809 25.3 % 28.6 % (9,249) (12.4) %

Interest expense, net 15,027 16,421 5.8 % 6.3 % (1,394) (8.5) %

Loss on extinguishment of debt 21 0.0 % 0.0 % (21) (100.0) %

Other income, net (4,744) (6,298) (1.8) % (2.4) % 1,554 (24.7) %

Total other expenses 10,283 10,144 4.0 % 3.9 % 139 1.4 %

Income before income taxes 55,277 64,665 21.3 % 24.7 % (9,388) (14.5) %

Income tax provision 14,889 17,826 5.7 % 6.8 % (2,937) (16.5) %

Net income $ 40,388 $ 46,839 15.6 % 17.9 % $ (6,451) (13.8) %

Service Revenue . Service revenue increased decreased by $23.2 $3.3 million, or 10.4%, 1.4%, to $246.7 $239.9 million for the three months ended June September 30, 2026 from $223.5 $243.2 million for the three months ended June September 30, 2025, representing 93.6% 92.7% and 94.7% 92.9% of total revenue, respectively. The following table depicts service revenue by segment:

Three Months Ended June September 30,

Percentage of Revenue Increase (Decrease)

($ in thousands) 2026 2025 2026 2025 $ %

Commercial Services $ 100,333 $ 117,296 38.8 % 44.8 % $ (16,963) (14.5) %

Government Solutions 122,463 108,293 47.3 % 41.3 % 14,170 13.1 %

Parking Solutions 17,109 17,630 6.6 % 6.8 % (521) (3.0) %

Total service revenue $ 239,905 $ 243,219 92.7 % 92.9 % $ (3,314) (1.4) %

Commercial Services service revenue decreased by $17.0 million, or 14.5%, from $117.3 million for the three months ended September 30, 2025 to $100.3 million for the three months ended September 30, 2026. The decrease was primarily due to a $16.1 million reduction in RAC tolling revenue, due to the effect of contract extensions entered into with two of our significant customers on materially less favorable terms, fleet volume fluctuations with one significant customer, and reduced travel demand compared to the same period in 2025.

Government Solutions service revenue increased by $17.1 $14.2 million, or 17.4%, 13.1%, from $98.0 $108.3 million for the three months ended June September 30, 2025, to $115.0 $122.5 million for the three months ended June September 30, 2026. The increase was primarily driven by a $12.0 million an increase of $8.6 million attributable to expansion in New York City revenues associated with speed, red light, bus lane, school bus and other services outside of NYCDOT. The remaining $5.6 million in growth is attributable to NYCDOT installation revenue on new camera installations, net of pricing changes under the new contract. The remaining $5.1 million in growth is attributable to expansion in bus lane, speed and other services.

Parking Solutions service revenue increased decreased to $16.6 $17.1 million for the three months ended June September 30, 2026, from $16.5 $17.6 million for the three months ended June September 30, 2025. The increased decreased revenue was primarily driven by SaaS product offerings, partially offset by decreases a reduction in subscription professional services and professional subscription services related to parking management solutions, partially offset by increases in SaaS product offerings.

Product Sales . Product sales were $16.9 $19.0 million and $12.5 $18.7 million for the three months ended June September 30, 2026 and 2025, respectively. The increase was entirely due to an a $0.2 million and $0.1 million increase in product sales in the Parking Solutions and Government Solutions segment. segments, respectively. Customer buying patterns vary greatly from period to period related to product sales.

Cost of Service Revenue, Excluding Depreciation and Amortization. Cost of service revenue, excluding depreciation and amortization increased from $4.6 $9.2 million for the three months ended June September 30, 2025 to $14.2 $14.9 million for the same period in 2026, mainly due to NYCDOT installation increased recurring service costs and increased recurring NYCDOT installation service costs.

Cost of Product Sales . Cost of product sales increased by $5.1 $4.8 million from $8.9 $12.8 million in the three months ended June September 30, 2025 to $14.0 $17.6 million in the three months ended June September 30, 2026, which was due to increased product sales primarily driven by the New York City NYCDOT expansion. partially offset by lower margin on product sales in the second quarter 2026 compared to the second quarter of 2025.

Operating Expenses . Operating expenses increased by $9.3 $2.4 million, or 11.4%, 2.7%, from $81.3 $88.0 million for the three months ended June September 30, 2025 to $90.6 $90.4 million for the three months ended June September 30, 2026. The increase in 2026 compared to the prior year period was primarily in the Government Solutions segment due to increases of approximately $7.7 $7.6 million driven by increases in subcontractor, information technology, rent and recurring services and rent costs, partially offset by $5.1 million in lower wage expense. Operating expenses as a percentage of total revenue decreased increased from 34.5% 33.6% to 34.4% 34.9% for the three months ended June September 30, 2025 and 2026, respectively. The following table presents operating expenses by segment:

Three Months Ended June September 30,

Percentage of Revenue Increase (Decrease)

($ in thousands) 2026 2025 2026 2025 $ %

Commercial Services $ 25,304 $ 26,417 9.8 % 10.1 % $ (1,113) (4.2) %

Government Solutions 58,847 55,968 22.7 % 21.4 % 2,879 5.1 %

Parking Solutions 4,731 4,199 1.8 % 1.6 % 532 12.7 %

Operating expenses by segment 88,882 86,584 34.3 % 33.1 % 2,298 2.7 %

Other expenses 1,522 1,452 0.6 % 0.5 % 70 4.8 %

Total operating expenses $ 90,404 $ 88,036 34.9 % 33.6 % $ 2,368 2.7 %

Selling, General and Administrative Expenses. Selling, general and administrative expenses decreased to $44.0 $43.4 million for the three months ended June September 30, 2026 compared to $48.5 $47.8 million for the same period in 2025. This was primarily due to a $7.2 $7.9 million decrease in stock-based compensation wages and benefits expense and a $1.2 $4.3 million decrease in credit loss expense stock-based compensation, partially offset by a $4.1 $7.9 million increase in expenses related to organization restructuring and executive transition costs and a $2.1 million increase in credit loss expense compared to the same period in the prior year. Selling, general and administrative expenses as a percentage of total revenue decreased from 20.5% 18.2% to 16.7% 16.8% for the three months ended June September 30, 2025 and 2026, respectively. The following table presents selling, general and administrative expenses by segment:

Three Months Ended June September 30,

Percentage of Revenue Increase (Decrease)

($ in thousands) 2026 2025 2026 2025 $ %

1 unchanged paragraph

Government Solutions

Total selling, general and administrative expenses

Goodwill Impairment. We recorded an impairment loss of $64.0 million for the three months ended June 30, 2026, as a result of the May 2026 assessment of goodwill impairment in our Parking Solutions segment. See Note 4, Goodwill and Intangible Assets , for additional information.

Impairment of Intangible Assets. We recorded an impairment loss of $40.4 million for the three months ended June 30, 2026, as a result of the May 2026 interim impairment assessment of long-lived assets in our Parking Solutions segment. See Note 4, Goodwill and Intangible Assets , for additional information.

1 unchanged paragraph

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4 unchanged paragraphs

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and 126 more changes in the filing

Market risk 2 changes

1 unchanged paragraph

Interest rate risk represents our exposure to fluctuations in interest rates associated with the variable rate debt represented by the Amended Term Loan, which has an outstanding balance of $683.6 $681.9 million at June September 30, 2026. respectively. As of June September 30, 2026, the interest rate on the Amended Term Loan was 5.6%. 5.9%.

Based on the June September 30, 2026 balance outstanding, each 1% movement in interest rates will result in an approximately $6.8 million change in annual interest expense.

Controls and procedures 3 changes

1 unchanged paragraph

Our disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Exchange Act) are designed to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC s rules and forms and to ensure that information required to be disclosed is accumulated and communicated to management, including our principal executive and financial officers, to allow timely decisions regarding disclosure. Our Interim Chief Executive Officer and Chief Financial Officer, with assistance from other members of management, have evaluated the effectiveness of our disclosure controls and procedures as of June September 30, 2026. Based upon such evaluation, our principal executive officer and principal financial officer have concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of such date.

1 unchanged paragraph

During the quarter ended June 30, 2026, we completed the multi-phase implementation of a new global enterprise resource planning ( ERP ) system to replace components of our operating and financial systems. The completed implementation resulted in changes to certain of our processes and internal controls, including new applications, interfaces and reports that support our financial reporting. The newly implemented ERP system was used during the quarter ended June 30, 2026, and the new and modified processes and controls were used to prepare our condensed consolidated financial statements for the three and six months ended June 30, 2026 included in this Report.

Except as described above, There have been no changes to our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended June September 30, 2026 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting

Risk factors 14 changes

Part I, Item 1A. Risk Factors in our Annual Report includes a discussion of our risk factors. Other than the risk factors below, there have been no material changes from the risk factors described in our Annual Report. We may disclose changes to such risk factors or disclose additional risk factors from time to time in our future SEC filings.

Our Commercial Services and Government Solutions segments have several large customers that account for a significant portion of our revenue, and a reduction in demand, materially less favorable terms or pricing in new or amended agreements as compared to the current agreements, or the loss, even temporarily, of one or more of such customers has and could have in the future a material adverse effect on our business.

Our business experiences varying levels of customer concentration. For example, in our Government Solutions segment, NYCDOT represented approximately 24.1% and 19.5% of our total revenues for the quarters ended September 30, 2026 and 2025, respectively. We entered into a new contract with NYCDOT, effective January 1, 2026, to manage New York City s automated enforcement camera safety programs for a five-year period. The terms of the new contract are materially different than our prior contract with NYCDOT, including service level agreements, service credits, liquidated damages, cybersecurity, and subcontracting requirements. If we do not successfully perform the contract pursuant to its terms, it could have a material adverse effect on our business, financial condition, and results of operations. We may continue to rely on a small number of customers in our Government Solutions segment to represent a significant portion of our total revenues in any given period. The loss of any of our top Government Solutions customers could have a material adverse effect on our business, financial condition, and results of operations.

We also experience customer concentration in our Commercial Services segment. Three of our Commercial Services customers collectively accounted for 29.5% and 38.0% of our total revenues for the quarters ended September 30, 2026 and

2025, respectively. In May 2026, one of our three significant Commercial Services customers issued a termination notice with respect to its contract with us. The customer subsequently withdrew its termination notice in July 2026 and entered into a seven-year contract extension on terms that were materially less favorable to us as compared to the prior agreement, including an option for the customer to modulate its fleet volume. During the third quarter of 2026, the customer significantly reduced its fleet volume under the contract and on October 2, 2026, we exercised our option to terminate the contract, effective January 30, 2027. We may be unable to replace the revenue that was expected under this contract on a timely basis or at all. A second significant Commercial Services customer entered into a five-year contract extension, also on terms materially less favorable to us than those of the prior agreement and with fleet volume modulation rights that are subject to terms and conditions set forth in the agreement. In addition, the contract with the third significant Commercial Services customer is approaching renewal, and we are following the customer's procurement process. We may not be successful in retaining the contract or may retain it only on terms less favorable to us than the current agreement.

If we are not successful in retaining the third customer contract or if any renewal is on less favorable terms than the current agreement and/or if either of the remaining contracts is terminated, this would have a material adverse effect on our business, financial condition, and results of operations.

We are in the midst of CEO and CFO transitions, and we depend on the services of key executives. Any inability to successfully transition leadership or to attract and retain key management personnel could have a material adverse effect on our business.

We believe that our future success depends upon the services of our executive management team, who have critical experience and relationships that we rely on to implement our business plan and growth strategy. From time to time, there have been and may be future changes in our executive management team resulting from the hiring or departure of these executives. Following the departure of our former Chief Executive Officer in May 2026, we have operated under the leadership of an Interim President and Chief Executive Officer. On September 30, 2026, our Board appointed Jon Newhard as President and Chief Executive Officer, effective November 1, 2026. In addition, on October 8, 2026, Craig Conti notified us of his resignation as Executive Vice President and Chief Financial Officer, effective November 4, 2026, and the Board has retained Spencer Stuart to conduct a search for a permanent Chief Financial Officer. The Board has appointed Matthew Kvarda, a Managing Director with Alvarez & Marsal North America, LLC ( A&M ), as Interim Chief Financial Officer, effective November 5, 2026. Mr. Kvarda will provide his services pursuant to an engagement letter with A&M, will remain an employee of A&M, and is not expected to serve as our permanent Chief Financial Officer. Either we or A&M may terminate the engagement on short notice, and an interim officer may be less familiar with our business, systems and personnel than a permanent officer. We cannot predict the duration of the search or whether we will be able to identify and successfully onboard a qualified successor on a timely basis. Effective succession planning and leadership transitions are complex undertakings, and we cannot assure you that Mr. Newhard s integration into the Company, or the transition of our Chief Financial Officer role, including the transition from an interim to a permanent Chief Financial Officer, will be successful or that our new leadership will be able to effectively implement our business plan and growth strategy.

The concurrent transition of our principal executive officer and principal financial officer may also place additional demands on our management team, including with respect to our financial reporting processes and internal control over financial reporting. Any disruption arising from these transitions, including any related changes to our strategy or management team, or any perception by employees, customers, investors, or other stakeholders that our leadership is unstable, could adversely affect our business.

Additionally, as our business grows, we may need to attract and hire additional management personnel. We have employment agreements with some members of senior management that include non-competition provisions; however, we cannot prevent our executives from terminating their employment and may not be able to fully enforce non-competition provisions limiting former executives or key personnel from competing with us following any departure. Moreover, we do not carry key-man life insurance on the lives of our executive officers, employees, or advisors. Our ability to retain our key management personnel or to identify and attract additional management personnel or suitable replacements is dependent on a number of factors, including the competitive nature of the employment market and our industry. Any failure to retain key management personnel or to attract additional or suitable replacement personnel has and in the future could cause uncertainty among investors, employees, customers, and others concerning our future direction and performance and could have a material adverse effect on our business, financial condition, and results of operations.

Our goodwill and intangible assets have been subject to impairment and may be subject to further impairment in the future, which could have a material adverse effect on our results of operations, financial condition, or future operating results.

We perform a goodwill and long-lived asset impairment test for each reporting unit annually, or more frequently if indicators for potential impairment exist. Indicators that are considered include significant changes in performance relative to expected operating results, significant negative industry or economic trends, or a significant decline in our stock price, and/or market capitalization for a sustained period of time. In addition, we assess the current and future economic outlook for our reporting units during the fiscal year. While we believe the assumptions used in determining whether there was impairment and the amount of any resulting impairment were reasonable and commensurate with the views of a market participant, changes in key assumptions in the future, including increasing the discount rate, lowering forecasts for revenue and operating margin, customer attrition, or lowering the long-term growth rate, could result in additional charges; similarly, one or more changes in these assumptions in future periods due to changes in circumstances could result in future impairments in one or more reporting units. We recognized a $40.4 million impairment of customer relationship, trademark and developed technology intangible assets during the nine months ended September 30, 2026 in connection with our assessment that the estimated undiscounted cash flows of the Parking Solutions asset group were less than its carrying amount. We also recorded a $64.0 million impairment to goodwill in our Parking Solutions segment during the nine months ended September 30, 2026 in connection with our assessment that the Parking Solutions reporting unit s carrying value exceeded the estimated fair value and we cannot predict if or when additional future goodwill impairments may occur. Any future goodwill impairments could have material adverse effects on our operating income, net assets, or our cost of, or access to, capital, which could harm our business. See Note 4, Goodwill and Intangible Assets , in Part I, Item 1, Financial Statements, for additional information.

We are subject to securities litigation, which is expensive and could adversely impact our business.

In June 2026, a putative securities class action complaint was filed against us and certain of our officers. The case is pending. See Note 13, Commitments and Contingencies , included in Part I, Item 1, Financial Statements in this Report for more information. Litigation of this type is expensive and could result in substantial cost and divert resources from our business regardless of the outcome of such litigation, which could have an adverse effect on our business, financial condition, results of operations or prospects. Any adverse determination in litigation could also subject us to significant liabilities.

Unregistered sales of stock 2 changes

1 unchanged paragraph

We did not have any purchases of our Class A Common Stock during the three months ended June September 30, 2026.

1 unchanged paragraph

We did not have any sales of unregistered equity securities during the three months ended June September 30, 2026.

Other information 1 change

1 unchanged paragraph

During the three months ended June September 30, 2026, none of o ur our directors or officers (as defined in Rule 16a-1(f) promulgated under the Exchange Act) adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement (as each term is defined in Item 408 of Regulation S-K).

Exhibits 27 changes

1 unchanged paragraph

Form of Retention Award Notice of Grant of Restricted Stock Units and Award Agreement (Interim President and Chief Executive Officer and Chief Financial Officer) under the Verra Mobility Corporation 2018 Equity Incentive Plan.

Form of Retention Award Notice of Grant of Restricted Stock Units and Award Agreement (Chief Customer Officer) under the Verra Mobility Corporation 2018 Equity Incentive Plan.

Form of Retention Award Notice of Grant of Restricted Stock Units and Award Agreement (U.S. Participants (Non-Executive)) under the Verra Mobility Corporation 2018 Equity Incentive Plan.

Form of Cash Retention Bonus Agreement (Interim President and Chief Executive Officer and Chief Financial Officer).

Form of Cash Retention Bonus Agreement (Chief Customer Officer).

Form of Retention Award Notice of Grant of Restricted Stock Units and Award Agreement (Non-U.S. Participants).

Description Form File No. Exhibit Filing Date Filed

3.1 Second Amended and Restated Certificate of Incorporation of Verra Mobility Corporation.

8-K 001-37979 3.1 October 22, 2018

3.2 Amended and Restated Bylaws of Verra Mobility Corporation.

8-K 001-37979 3.1 November 9, 2023

10.1# Executive Employment Agreement, dated a s of October 1, 2026, by and between VM Consolidated, Inc. and Jon Newhard.

3 unchanged paragraphs

2 unchanged paragraphs

and 15 more changes in the filing