Financial Performance - Payoneer reported revenues of $260.6 million and $507.2 million for the three and six months ended June 30, 2025, representing increases of 9% and 8% year-over-year, respectively[148]. - Net income for the three months ended June 30, 2025, was $19.5 million, a decrease of 40% compared to the prior year[144]. - Adjusted EBITDA for the three months ended June 30, 2025, was $66,425 thousand, compared to $72,778 thousand for the same period in 2024[194]. - Adjusted EBITDA for the six months ended June 30, 2025, was $131,856 thousand, slightly down from $138,013 thousand in the same period of 2024[194]. Volume and Customer Funds - The company processed $20.7 billion and $40.4 billion in volume during the three and six months ended June 30, 2025, compared to $18.7 billion and $37.2 billion in the same periods of 2024[132]. - Customer funds on Payoneer's platform grew to $7.0 billion as of June 30, 2025, contributing to increased interest income revenue despite a decline in interest rates[136]. - Volume for the three months ended June 30, 2025, was $20,688 million, an 11% increase compared to $18,713 million in the same period of 2024[189]. - Volume for the six months ended June 30, 2025, reached $40,363 million, a 9% increase from $37,169 million in the same period of 2024[189]. Expenses - Research and development expenses increased by 36% to $37.4 million for the three months ended June 30, 2025, driven by higher employee-related costs and contractor expenses[152]. - Research and development expenses increased by $15 million, or 25%, to $74.7 million for the six months ended June 30, 2025, driven by higher employee compensation and contractor expenses[153]. - Sales and marketing expenses rose by $11.5 million, or 11%, to $112.0 million for the six months ended June 30, 2025, primarily due to increased employee-related expenses and marketing expenditures[155]. - General and administrative expenses increased by $16.6 million, or 33%, to $66.9 million for the six months ended June 30, 2025, largely due to higher employee compensation and consulting expenses[159]. - Depreciation and amortization expenses rose by $9.8 million, or 49%, to $29.9 million for the six months ended June 30, 2025, mainly driven by increased amortization of internal use software[160]. - Transaction costs rose to $40.6 million for the three months ended June 30, 2025, a 10% increase attributed to higher bank and processor fees[149]. Cash Flow and Liquidity - Net cash provided by operating activities was $124.4 million for the six months ended June 30, 2025, an increase of $43.5 million compared to the prior year[176]. - Net cash used in investing activities decreased by $831.8 million to $133.5 million for the six months ended June 30, 2025, reflecting a shift in investment strategy[183]. - Net cash provided by financing activities was $2.2 million for the six months ended June 30, 2025, a decrease of $456.6 million compared to the prior year[185]. - As of June 30, 2025, the company had $497.1 million in cash and cash equivalents, indicating strong liquidity[169]. - The company repurchased 6,692,475 shares for $49.7 million during the six months ended June 30, 2025, with $54.1 million remaining available for future repurchases[171]. Acquisitions and Strategic Moves - The company acquired Payeco Finance Information Holding Corporation on April 9, 2025, enhancing its regulatory infrastructure in China[142]. - Payoneer also acquired Skuad Pte. Ltd. on August 5, 2024, to strengthen its financial services for SMBs operating internationally[143]. Market and Regulatory Environment - The company anticipates a negative impact on revenue from declining interest rates over the medium term due to recent Federal Reserve rate cuts[136]. - Payoneer continues to monitor geopolitical events, including the ongoing conflicts in Israel and Ukraine, which may affect its operations and revenue[137][141]. - The company is evaluating the potential impacts of the One Big Beautiful Bill Act on its effective tax rate and deferred tax assets, but does not expect a material impact for the period ended June 30, 2025[165]. Foreign Exchange and Interest Rate Risks - The company held $1.8 billion in term deposits and U.S. Treasury Securities, which could be materially affected by changes in interest rates[201]. - The company has entered into interest rate floor contracts with respect to $1.9 billion in customer funds to mitigate risks from declining interest rates[202]. - A hypothetical 10% strengthening or weakening of the U.S. dollar against the New Israeli Shekel could have a material impact on unrealized gains or losses[204]. - The company generates revenues from foreign exchange transactions, which are influenced by market conditions and regulations[206]. - Management closely monitors volume and revenue to ensure continued growth in funds and business activity on the platform[190].
PAYONEER GLEQ.WARRT.EXP(PAYOW) - 2025 Q2 - Quarterly Report