Remitly (US:RELY) The Motley Fool·2025-12-03 04:10Core Viewpoint - Remitly Global's strong earnings report was overshadowed by concerns over slowing growth and rising credit risk, leading to a significant sell-off in its stock despite solid performance metrics [1][6]. Financial Performance - In the third quarter, Remitly reported a 21% increase in active customers, reaching 8.9 million, and a 35% rise in send volume to $19.5 billion, resulting in a 25% revenue increase to $419.5 million, surpassing the consensus estimate of $413.7 million [5]. - Adjusted EBITDA rose by 29% to $61.2 million, indicating strong operational performance [5]. Market Reaction - The stock hit a 52-week low and finished down 16% for the month, reflecting investor disappointment despite the positive earnings report [2][4]. - The sell-off was exacerbated by management's guidance for the fourth quarter, projecting revenue of $426 million to $428 million, which was below the consensus estimate of $430.5 million [7]. Growth Outlook - Management indicated that revenue growth is slowing, with expectations of high teens growth in 2026, suggesting potential maturation of the core business [8]. - Despite the slowing growth, Remitly is currently trading at a price-to-sales ratio of less than 2 and 12 times its expected EBITDA for the full year, indicating it may be undervalued [8]. Strategic Initiatives - The company is expanding its platform with new products like Remitly Business and the Remitly One membership program, which includes features such as "send now, pay later" and stablecoin transfers [6]. - Targeting high-value senders and recent product expansions suggest that there is still significant upside potential for the stock [9].