Western Union(US:WU)2025-07-28 20:08Financial Performance - Second quarter 2025 revenue was $1.03 billion, a decrease of 4% on a reported basis and 1% on an adjusted basis, excluding Iraq[2]. - GAAP EPS for Q2 2025 was $0.37, down from $0.41 in the prior year, while adjusted EPS was $0.42, down from $0.44[3]. - Net income for Q2 2025 was $122.1 million, a decrease of 13% compared to $141.0 million in the prior year[20]. - Net income for the six months ended June 30, 2025, was $245.6 million, a decrease of 13% compared to $283.7 million in 2024[24]. - Total consolidated revenues for the second quarter of 2025 were $1,026.1 million, down 4% from $1,066.4 million in the same period of 2024[26]. - Adjusted revenues (non-GAAP) for the first half of 2025 showed a year-over-year decline of 6%[30]. - The company expects full year 2025 revenue to be between $4,085 million and $4,185 million, with adjusted revenue between $4,035 million and $4,135 million[8]. - The company projects FY2025 revenues (GAAP) in the range of $4,085 million to $4,185 million, with adjusted revenues (non-GAAP) expected between $4,035 million and $4,135 million[49]. Segment Performance - Consumer Money Transfer segment revenue decreased 8% on a reported basis, with transactions declining 3% compared to the prior year[4]. - Branded Digital revenue grew 6% on both a reported and adjusted basis, with transactions up 9%[5]. - Consumer Services segment revenue increased by 39% on a reported basis and 41% on an adjusted basis, driven by the expansion of the Travel Money business in Europe[9]. - Consumer Money Transfer revenues decreased by 8% to $885.0 million in Q2 2025, compared to $965.0 million in Q2 2024[26]. - Operating income for the Consumer Money Transfer segment fell by 12% to $167.7 million in Q2 2025, down from $191.5 million in Q2 2024[26]. - The total segment operating income margin for Consumer Money Transfer was 19% in Q2 2025, down from 20% in Q2 2024[26]. - Consumer Services segment revenues (GAAP) increased by 28% year-over-year for FY2024, with a forecasted growth of 34% for 2Q25[34]. - The operating margin for Consumer Services segment is projected to be 22% for 2Q25, up from 11% in 2Q24[34]. Cash Flow and Assets - Cash flows from operating activities increased to $147.9 million in the first half of 2025, compared to $60.2 million in the same period of 2024[24]. - Net cash used in investing activities was $177.4 million for the six months ended June 30, 2025, compared to $68.4 million in 2024[24]. - Cash and cash equivalents at the end of the period were $1,404.5 million, a decrease from $1,485.4 million at the end of June 2024[24]. - Total assets as of June 30, 2025, were $7,984.3 million, down from $8,370.5 million at the end of 2024[22]. Tax and Operating Margins - Operating margin for 2025 is projected to be between 18% and 20% for GAAP and 19% to 21% for adjusted[8]. - The GAAP effective tax rate is expected to be between 19% and 21%, while the adjusted effective tax rate is projected to be between 13% and 15%[8]. - The effective tax rate (GAAP) for FY2024 was -51%, while the adjusted effective tax rate was 13%[45]. Regional Performance - North America region revenues (GAAP) decreased by 1% year-over-year for FY2024, with a forecasted decline of 9% for 2Q25[32]. - EU & CIS region revenues (GAAP) showed a slight decline of 2% year-over-year for FY2024, but are expected to grow by 5% in 2Q25[32]. - MEASA region revenues (GAAP) experienced a significant decline of 19% year-over-year for FY2024, with a forecasted decline of 25% for 2Q25[32]. - LACA region revenues (GAAP) increased by 2% year-over-year for FY2024, but are projected to decline by 13% in 2Q25[32]. - APAC region revenues (GAAP) decreased by 7% year-over-year for FY2024, with a forecasted decline of 4% for 2Q25[32]. Adjustments and Non-Cash Items - The company will no longer adjust for the estimated impact of Argentinian hyperinflation starting in 2Q25, as inflation has moderated to less than 50%[35]. - Non-cash recognition of deferred tax assets has been excluded from reported results due to its significance[53]. - The Company has removed the non-cash reversal of deferred tax assets from its 2025 adjusted net income and earnings outlook[53]. Other Notable Events - The Company experienced a significant increase in business originating from Iraq starting March 2023, attributed to policy changes by U.S. and Iraqi regulators[53]. - In July 2023, the U.S. Treasury and the Federal Reserve banned 14 Iraqi banks from conducting U.S. dollar transactions, impacting the Company's operations[53]. - The Central Bank of Iraq suspended the Company's largest agent in October 2023, but the agent was later reinstated[53]. - Management believes that revenue measures excluding Iraq revenues provide better consistency and comparability to prior periods[53]. - The Company reorganized its international operations in Q4 2024, recognizing deferred tax assets associated with this reorganization[53]. - Transactions and revenue are categorized based on the region where the money transfer is initiated[53]. - The North America region represents the Company's Consumer Money Transfer segment, including the U.S. and Canada[53]. - The Company excludes revenues generated from Iraq websites and mobile applications from the definition of Branded Digital due to significant volatility[53].