Group 1 - Flywire (FLYW) is effectively managing revenue challenges in its primary markets: the US, Canada, and Australia, particularly in the education sector due to stricter student visa regulations [1] - The combination of payment solutions and associated software is gaining traction in the market [1] Group 2 - The article reflects an individual investor's focus on undercovered companies, particularly in technology, software, electronics, and energy transition sectors [1] - The investor has over 7 years of personal capital investment experience and emphasizes the importance of identifying asymmetric investment opportunities for achieving market-beating returns [1]

Client Base and Market Presence - As of September 30, 2025, the company serves over 4,900 clients globally, including more than 3,100 educational institutions and over 100 healthcare systems[187]. - The company is diversifying its education client base internationally to reduce reliance on U.S. higher-education volumes[230]. Financial Performance - The total payment volume enabled by the company was approximately $29.7 billion, $28.2 billion, and $22.8 billion for the years ended December 31, 2024, and the nine months ended September 30, 2025 and 2024, respectively[188]. - The company generated revenue of $492.1 million and $403.1 million for the years ended December 31, 2024, and 2023, respectively, with a net income of $2.9 million for 2024[189]. - Revenue for the three months ended September 30, 2025, was $200.1 million, an increase of $43.3 million or 27.6% compared to $156.8 million in the same period of 2024[248]. - Revenue for the nine months ended September 30, 2025, was $465.5 million, an increase of $90.9 million or 24.3% compared to $374.6 million for the same period in 2024[262]. - Net income for the three months ended September 30, 2025, was $29.6 million, a decrease of $9.3 million or 23.9% compared to $38.9 million in 2024[248]. - Net income for the nine months ended September 30, 2025, was $13.5 million, a decrease of $5.3 million or 28.2% from $18.8 million in 2024[261]. Transaction and Payment Volume - The company achieved a 26.4% increase in total payment volume from $11.0 billion during the three months ended September 30, 2024, to $13.9 billion during the same period in 2025[188]. - Transaction revenue increased to $167.2 million for the three months ended September 30, 2025, up $32.7 million or 24.4% from $134.4 million in 2024, driven by growth in transaction payment volume[249]. - Transaction payment volume rose approximately 30.9% to $11.5 billion for the three months ended September 30, 2025, compared to $8.8 billion in the same period of 2024[249]. - Total payment volume for the nine months ended September 30, 2025, was approximately $28.2 billion, an increase from $22.8 billion in the same period in 2024, with transaction revenue contributing $22.9 billion and platform revenues $5.3 billion[279]. Expenses and Costs - Payment processing services costs were $72.3 million for the three months ended September 30, 2025, an increase of $17.7 million or 32.4% from $54.6 million in 2024, correlating with the increase in transaction payment volume[251]. - General and administrative expenses were $99.2 million for the nine months ended September 30, 2025, an increase of $4.6 million or 4.9% from $94.6 million in 2024[267]. - Interest expense increased to $3.0 million for the nine months ended September 30, 2025, compared to $0.4 million in 2024, reflecting a rise of $2.6 million or 650.0%[269]. - Cash used in investing activities for the nine months ended September 30, 2025, was $191.2 million, mainly due to the acquisition of Sertifi for $324.9 million, net of cash acquired[307]. Acquisitions and Investments - The company acquired Sertifi LLC for $330.0 million, aimed at accelerating its travel business and expanding offerings to over 20,000 hotel locations globally[193]. - The acquisition of Invoiced for approximately $51.7 million was intended to enhance the company's global expansion in the B2B vertical[194]. - The company plans to increase investments in technology and development, expecting expenses to rise but believing these will contribute to long-term growth and profitability[208]. Operational Challenges and Strategies - The company continues to face challenges in achieving profitability while focusing on expanding its client base and enhancing its payment solutions[191]. - The company implemented a restructuring plan in early 2025 aimed at improving operational efficiencies and reducing costs[241]. - The company expects to continue investing in technology and development to enhance client experience and attract new clients[237]. Market Conditions and Economic Impact - Seasonal fluctuations in revenue are expected, with the third quarter historically being the strongest due to the education peak season[210]. - A 40% reduction in international students in Canada has been reported since the implementation of a temporary intake cap on student permit applications[212]. - The Australian government has set a ceiling of 270,000 international students for 2025, which may adversely impact the company's business[213]. - The U.S. government's new $100,000 filing fee for H-1B visas could significantly increase personnel costs and affect hiring flexibility[218]. - The "One Big Beautiful Bill" in the U.S. may limit financial aid options, potentially reducing demand for higher education and impacting revenue[223]. - Inflation did not materially affect cash flows or operations during the three and nine months ended September 30, 2025[227]. Cash Flow and Financing - Net cash provided by operating activities for the nine months ended September 30, 2025, was $95.3 million, down from $127.2 million in 2024[301]. - The company may seek additional equity or debt financing in the future, depending on various factors including revenue growth and market conditions[299]. - Cash used in financing activities for the nine months ended September 30, 2025, was $53.9 million, primarily from the repayment of $110.0 million on the 2024 Amended Revolving Credit Facility[309].

Core Insights - Flywire (FLYW) reported $194.1 million in revenue for Q3 2025, a year-over-year increase of 28.2% [1] - The EPS for the same period was $0.23, down from $0.30 a year ago [1] - Revenue exceeded the Zacks Consensus Estimate of $179.54 million by 8.11%, and EPS surpassed the consensus estimate of $0.19 by 21.05% [1] Financial Performance Metrics - Total Payment Volume reached $13.9 billion, exceeding the average estimate of $12.61 billion [4] - Revenue from transactions was $167.2 million, compared to the average estimate of $155.82 million, reflecting a year-over-year increase of 24.4% [4] - Revenue less ancillary services for transactions was $165.7 million, surpassing the average estimate of $151.93 million, also showing a 24.4% year-over-year change [4] - Revenue less ancillary services for platform and other revenues was $28.4 million, exceeding the average estimate of $24.79 million, with a significant year-over-year increase of 56% [4] - Revenue from platform and other revenues was $33 million, compared to the estimated $26.2 million, marking a 47.5% increase year-over-year [4] Stock Performance - Flywire's shares have returned -0.3% over the past month, while the Zacks S&P 500 composite increased by 2.1% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Core Insights - Flywire (FLYW) reported quarterly earnings of $0.23 per share, exceeding the Zacks Consensus Estimate of $0.19 per share, but down from $0.30 per share a year ago, resulting in an earnings surprise of +21.05% [1] - The company generated revenues of $194.1 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 8.11% and increasing from $151.4 million year-over-year [2] - Flywire has outperformed consensus EPS estimates two times in the last four quarters and has topped revenue estimates three times in the same period [2] Financial Performance - The earnings report indicates a mixed trend in estimate revisions ahead of the release, leading to a Zacks Rank 3 (Hold) for the stock, suggesting it will perform in line with the market [6] - Current consensus EPS estimate for the upcoming quarter is -$0.01 on revenues of $136.13 million, while for the current fiscal year, it is $0.04 on revenues of $572.06 million [7] Industry Context - The Internet - Software industry, to which Flywire belongs, is currently ranked in the top 32% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Flywire's stock performance [5]

Financial Data and Key Metrics Changes - Revenue less ancillary services for Q3 2025 was $194 million, representing a 26% year-over-year FX-neutral growth, or 28% on a spot basis [24] - Adjusted EBITDA increased to $57.1 million for the quarter compared to $42.2 million in Q3 2024, with an adjusted EBITDA margin up 155 basis points year-over-year [30] - Total payment volume climbed to $13.9 billion, 26% higher year-over-year, highlighting the growing strength and scalability of the platform [27] Business Line Data and Key Metrics Changes - The education vertical saw significant growth, with more than half of new education wins coming from outside traditional Big Four markets [4][17] - In the travel vertical, revenue growth was driven by continued momentum in destination management companies and luxury accommodations, significantly exceeding Q3 bookings planned [19] - Healthcare revenue growth approached the organic corporate average, driven by recent wins with large enterprise customers [5] Market Data and Key Metrics Changes - The U.K. market represented approximately one quarter of total revenues and grew above the organic corporate average growth rate in Q3 [11] - Australia’s performance was significantly better than expected, growing above the organic corporate average growth rate during the quarter [15] - In Canada, existing clients are increasingly expanding into domestic payment flows, helping diversify revenue [16] Company Strategy and Development Direction - The company focuses on optimizing go-to-market excellence, accelerating product innovation, and cultivating high-performing teams [3] - Flywire aims to deepen client relationships, expand market share, and drive durable, high-margin growth as it evolves from a cross-border payments company to a diversified global software and payments leader [7] - The strategy includes deeper integrations in the U.K. to position Flywire as the sole channel for all significant university payment flows [11] Management's Comments on Operating Environment and Future Outlook - Management noted that macro conditions were better than expected, supporting strong execution and client demand across markets [3] - The company anticipates sustained growth outside the Big Four markets, with strong momentum in APAC and EMEA regions [17] - Management expressed confidence in navigating complex times and highlighted the diversified business model as a strength [42] Other Important Information - The company raised its full-year revenue and EBITDA guidance based on better-than-expected macro conditions [24] - The balance sheet remains strong, ending the quarter with $212 million in cash and cash equivalents, with just $15 million of outstanding debt [31] - The company repurchased 0.8 million shares for approximately $10 million under its share repurchase program [32] Q&A Session Summary Question: Can you provide perspective on the U.K. client penetration metric? - Management indicated that 12 clients in the U.K. are at 90% penetration, which is a core element of their strategy to consolidate payment flows [38][39] Question: What is the preliminary outlook for 2026? - The outlook for 2026 includes mid-single-digit pressure primarily from the U.S., with Canada and Australia also expected to experience some negative impact [40][41] Question: How do geopolitical headwinds affect growth expectations? - Management acknowledged that while geopolitical headwinds have eased, they remain prudent in their growth expectations, particularly in the U.S. market [42] Question: What is the impact of new education wins outside the Big Four? - Management noted that while new wins outside the Big Four may be smaller in size, they are contributing meaningfully to growth and market share [56] Question: How does the company plan to balance investments in sales and marketing? - The company is focused on targeted investments in areas with growth potential while maintaining efficiency in spending [58]

Financial Performance - Third quarter revenue increased by 27.6% year-over-year to $200.1 million, compared to $156.8 million in the same quarter of 2024[4] - Revenue less ancillary services increased by 28.2% to $194.1 million in Q3 2025, compared to $151.4 million in Q3 2024[6] - Flywire reported Q3 2025 revenue of $200.1 million, a 27.5% increase from $156.8 million in Q3 2024[24] - Net income for Q3 2025 was $29.6 million, a decrease of 23.4% compared to $38.9 million in Q3 2024[34] - Adjusted EBITDA increased to $57.1 million in Q3 2025, compared to $42.2 million in Q3 2024, with an adjusted EBITDA margin of 29.4%[6] - Adjusted EBITDA for Q3 2025 reached $57.1 million, up 35.2% from $42.2 million in Q3 2024[34] - Net income for the nine months ended September 30, 2025, was $13.464 billion, down from $18.799 billion in 2024, representing a decrease of approximately 28.5%[28] - Revenue for the nine months ended September 30, 2025, increased to $465.5 million, a 24.2% increase from $374.6 million in 2024[30] - Adjusted gross profit for the nine months ended September 30, 2025, was $287.9 million, compared to $237.3 million in 2024, reflecting a growth of 21.4%[30] Client Acquisition and Growth - The company signed over 200 new clients across all verticals in Q3 2025, excluding Sertifi properties[6] - Sertifi contributed $12.9 million to revenue in Q3 2025, adding 8 points of revenue growth year-over-year[4] - Flywire anticipates FX-neutral revenue less ancillary services growth of 23-25% year-over-year for FY 2025[8] Expenses and Liabilities - Total operating expenses for Q3 2025 were $167.9 million, up from $136.5 million in Q3 2024, representing a 22.9% increase[24] - Flywire's total liabilities rose to $430.7 million as of September 30, 2025, compared to $307.7 million at the end of 2024[26] - The company paid down $45 million of debt related to the Sertifi acquisition, with $15 million remaining as of the end of Q3 2025[6] Cash Flow and Investments - Cash flows from operating activities for the nine months ended September 30, 2025, were $95.289 million, down from $127.221 million in 2024, a decrease of approximately 25.1%[28] - The company reported a net cash used in investing activities of $191.168 million for the nine months ended September 30, 2025, compared to $204.582 million in 2024[28] - The company acquired businesses net of cash acquired for $324.921 million during the nine months ended September 30, 2025, significantly higher than $45.438 million in 2024[28] Share Repurchase and Stock Performance - The company repurchased approximately 0.8 million shares for about $10 million, with $192 million remaining in the share repurchase program[6] - The company repurchased common stock amounting to $64.319 million during the nine months ended September 30, 2025, compared to $22.883 million in 2024[28] Market Outlook and Strategy - Flywire raised its FY 2025 revenue guidance by 400 bps at midpoint and adjusted EBITDA margin guidance by 75 bps at midpoint[1] - Flywire's Adjusted EBITDA margin growth expectations remain positive despite current market challenges[21] - The company is focusing on cross-border expansion and enhancing its client base in the business-to-business sector[21] - Flywire plans to continue developing new solutions and services to meet anticipated technology needs in the financial services sector[21]

Q3 2025 Performance Highlights - Revenue reached $200.1 million[12] - Gross Margin was 62.3%[12] - Net Income was $29.6 million[12] - Total Payment Volume increased by 26.4% to $13.9 billion[14] - Revenue Less Ancillary Services (RLAS) grew by 28.2% to $194.1 million[14] - Adjusted EBITDA was $57.1 million, representing 29.4% of RLAS[14] Q3 2025 Performance vs Guidance - Total RLAS exceeded guidance by $13.0 million[15] - Year-over-year RLAS Spot Growth beat guidance by 860 bps[15] - Year-over-year RLAS FXN Growth beat guidance by 930 bps[15] - Sertifi Revenue was $12.9 million, exceeding guidance by $2.4 million[15] - Adjusted EBITDA exceeded guidance by $4.8 million[15] FY 2025 Outlook - The company raised FY 2025 FX-Neutral Revenue Less Ancillary Services growth guidance to 23-25%[76] - The company expects Sertifi to contribute $42-44 million in revenue[76] - The company raised Adjusted EBITDA Margin Expansion guidance to 330-370 bps[76]

Core Insights - Flywire Corporation reported a 27.6% year-over-year increase in revenue for the third quarter of 2025, reaching $200.1 million, compared to $156.8 million in the same quarter of 2024 [4] - The company raised its fiscal year 2025 revenue guidance by 400 basis points at the midpoint and adjusted EBITDA margin guidance by 75 basis points at the midpoint [1][5] Financial Performance - Revenue less ancillary services increased by 28.2% year-over-year to $194.1 million in Q3 2025, compared to $151.4 million in Q3 2024 [4] - Total payment volume rose by 26.4% to $13.9 billion in Q3 2025, up from $11 billion in Q3 2024 [4] - Net income for Q3 2025 was $29.6 million, down from $38.9 million in Q3 2024 [4] - Adjusted EBITDA increased to $57.1 million in Q3 2025, compared to $42.2 million in Q3 2024, with an adjusted EBITDA margin of 29.4% [4] Client Acquisition and Market Position - The company added over 200 new clients across all verticals in Q3 2025, excluding the added Sertifi properties [4][10] - Flywire deepened its partnership with Workday to integrate into the Workday Student Information System, enhancing its service offerings [4] Guidance and Future Outlook - For fiscal year 2025, Flywire anticipates FX-neutral revenue less ancillary services growth of 23-25% year-over-year, with adjusted EBITDA margin growth of 330-370 basis points [6] - For Q4 2025, the company expects FX-neutral revenue less ancillary services growth of 23-27% year-over-year [7] Strategic Developments - The company repurchased approximately 0.8 million shares for about $10 million, with $192 million remaining in the share repurchase program [4] - Flywire paid down $45 million of debt related to the Sertifi acquisition, leaving $15 million of debt outstanding [4]

Core Insights - Flywire Corporation has appointed Nicole James as Chief People Officer, effective November 4, 2025, to lead its global HR function [1][2] - CEO Mike Massaro emphasized that James' experience in digital transformation and talent development aligns with Flywire's strategic priorities [2] - James previously held leadership roles at Credit Karma, Unite Us, and Square, where she scaled people functions and led global expansion efforts [2] Company Overview - Flywire is a global payments enablement and software company that combines a proprietary global payments network with vertical-specific software [5] - The company supports over 4,800 clients with diverse payment methods in more than 140 currencies across over 240 countries and territories [7] - Flywire integrates with leading ERP systems to optimize payment experiences and eliminate operational challenges for clients [6] Recognition and Culture - Flywire has been recognized as one of America's Greatest Companies by Newsweek and one of the World's Top FinTech Companies by CNBC [4] - The company is noted for its award-winning culture and high-performing teams, which are central to its operational success [4][3]

Core Insights - Flywire is positioned as a vital partner for U.S. higher education institutions, helping them enhance revenue and student success amid changing federal policies and enrollment pressures [1][2] - The Flywire Student Financial Software (SFS) is delivering significant ROI by automating processes and protecting enrollment revenue, with institutions reporting improved working capital cycles and reduced operational burdens [2][3] Financial Performance and Metrics - Institutions utilizing Flywire's SFS have experienced a drop in default rates from as high as 34% to as low as 1% due to self-service, accurate, and intuitive payment plans [2] - Flywire has activated over 827,000 payment plans since inception, collected over $360 million in past-due tuition, and achieved more than $72 million in pre-collection savings for partner institutions [5] Institutional Adaptation and Innovation - Keynote speakers emphasized the need for institutions to adapt to demographic and market shifts, diversify student populations, and create sustainable revenue streams to remain competitive [4] - Flywire's commitment to innovation is evident in its ability to meet the evolving needs of institutions across the U.S. higher education landscape [3] Client Success Stories - Southern Methodist University processed nearly 25,000 transactions and collected over $1.5 million in past-due debt shortly after implementing SFS [8] - Central Washington University saw its payment plan default rate drop dramatically from 34% to less than 1% after implementing SFS Collection Management [8] - Purdue University recovered over $7 million and resolved more than 70% of accounts since implementing SFS Collection Management [8] Awards and Recognition - Flywire recognized several institutions for their achievements in leveraging innovation to drive efficiency and improve student experiences during the Flywire Fusion event [6][8] - Citi was awarded the inaugural 2025 Partner of the Year for its long-standing partnership with Flywire, supporting its strategic growth [8]