Performance was driven by a 26% surge in Consumer Services, specifically travel money and bill payments, which helped offset a 9% decline in adjusted revenue from the Consumer Money Transfer segment. Management attributes retail headwinds in The Americas to shifting geopolitical environments and immigration policy changes, though transaction growth rates in the U.S.-Mexico corridor improved by hundreds of basis points relative to Q3. The company is transitioning from a pure remittance provider to a 'r ...

Core Viewpoint - Western Union's stock is experiencing bearish pressure due to mixed financial results, with earnings exceeding expectations but revenue falling short of consensus estimates [2][3]. Financial Performance - The company reported fourth-quarter earnings of 45 cents per share, surpassing analyst estimates of 43 cents and showing a 12.5% increase from 40 cents a year ago [2]. - Revenue for the fourth quarter was $1.008 billion, missing the consensus estimate of $1.045 billion and declining 4.73% year-over-year [2]. - Full-year revenue decreased by 4% on a reported basis and 2% on an adjusted basis, excluding Iraq [3]. Guidance and Projections - Western Union projects GAAP sales between $4.254 billion and $4.375 billion, and adjusted sales between $4.237 billion and $4.357 billion, which is above the consensus estimate of $4.120 billion [3]. - Adjusted EPS guidance is set at $1.75 to $1.85, aligning closely with expectations, while GAAP EPS guidance is below market forecasts [3]. Segment Performance - The company experienced mixed momentum across segments, with Consumer Services reporting a 15% growth and Branded Digital growing by 7% [4]. - However, the core Consumer Money Transfer (CMT) segment saw a revenue decline of 7% in the fourth quarter, with adjusted revenue falling by 9% [4]. - For the full year, Western Union generated $4.1 billion in revenue, down 4% on a reported basis, while adjusted EPS remained steady at $1.75 [4]. Shareholder Returns - The company returned $529 million to shareholders through dividends and buybacks, alongside reporting $544 million in operating cash flow [5]. Analyst Ratings - Analysts have shown mixed sentiments towards Western Union, with Cantor Fitzgerald initiating coverage with an underweight rating and a $9.00 target [6]. - Keefe, Bruyette & Woods maintained a market perform rating but raised the target from $9.00 to $10.00 [6]. - UBS and Susquehanna also maintained neutral ratings, with UBS setting a target at $9.00 and Susquehanna increasing its target to $10.00 [7]. Stock Performance - At the time of publication, Western Union shares were down 6.04% at $8.87 [7].

Financial Performance - For the quarter ended December 2025, Western Union reported revenue of $1.01 billion, a decrease of 4.7% year-over-year [1] - EPS for the quarter was $0.45, an increase from $0.40 in the same quarter last year [1] - The reported revenue was 2.65% below the Zacks Consensus Estimate of $1.04 billion, while the EPS exceeded the consensus estimate of $0.43 by 4.34% [1] Key Metrics - Total Consumer Money Transfer transactions were 73.1 million, matching the four-analyst average estimate [4] - Cross-border principal for Consumer Money Transfer reached $27.7 billion, surpassing the two-analyst average estimate of $27.24 billion [4] - Revenue from Consumer Services was $136.9 million, below the five-analyst average estimate of $147.58 million, but showed a year-over-year increase of 14.7% [4] - Revenue from Consumer Money Transfer was $871.5 million, which is a 7.2% decline compared to the year-ago quarter and below the average estimate of $889.52 million [4] - Segment Operating Income for Consumer Services was $23.2 million, lower than the average estimate of $35.29 million [4] - Segment Operating Income for Consumer Money Transfer was $175.4 million, exceeding the average estimate of $159.07 million [4] Stock Performance - Shares of Western Union have returned +0.3% over the past month, while the Zacks S&P 500 composite experienced a -1% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3]

Core Insights - The company reported adjusted earnings per share of $0.45, an increase from $0.40 in the same quarter last year, indicating a potential stabilization in its retail business despite ongoing geopolitical challenges [1][34] - Consumer money transfer transactions decreased by 2.5% in the quarter, but cross-border principal growth showed resilience, suggesting a strong customer base adapting to macroeconomic conditions [2][37] - The company aims to build a digital-first, retail-enabled consumer services model, leveraging its global brand and payment capabilities to moderate fluctuations in its core remittance business [3][4] Financial Performance - For the fourth quarter, the company reported revenue of $1 billion, reflecting a 5% decline year-over-year on an adjusted basis [3][32] - The full year GAAP revenue was $4.1 billion, with adjusted revenue growth excluding Iraq down by 2% due to challenges in the Americas retail business [32][34] - Adjusted operating margin for the full year was 20%, up from 19% in the previous year, benefiting from cost discipline [34] Consumer Services and Digital Growth - Consumer services adjusted revenue grew by 26% in the fourth quarter and nearly 30% for the full year, driven by travel money and bill payments [35][36] - The branded digital business saw a 13% increase in transactions and a 6% rise in adjusted revenue, marking nine consecutive quarters of revenue growth [38][39] - The digital business now accounts for over 40% of the principal sent globally, with significant growth opportunities in the Middle East and other regions [21][22] Market Dynamics and Strategy - The company is focusing on operational efficiencies and expanding its payment capabilities to drive productivity and market competitiveness [4][6] - Recent geopolitical changes in regions like Chile and Venezuela are impacting migration and mobility, creating a dynamic environment for the business [8][62] - The implementation of a U.S. remittance tax has not materially impacted the business so far, but the company is closely monitoring its effects [9][15] Partnerships and Expansion - The company has secured several new exclusive partnerships, including with Canada Post and Deutsche Post, expected to generate at least $100 million in incremental retail revenue annually [27][29] - The company is expanding its wallet capabilities in various countries, including Australia, Mexico, Singapore, and the Philippines, to enhance customer retention and monetization [12][13][25] - The company is also developing a digital asset strategy, including the launch of a U.S. Dollar payment token and partnerships for stablecoin transactions [24][25][73] Outlook - The adjusted revenue outlook for 2026 is projected to grow by 6% to 9%, with adjusted EPS expected to be between $1.75 and $1.85 [44][45] - The company anticipates that the integration of Intermex will contribute positively to its financial performance, with expected synergies enhancing overall profitability [70][71] - The company is adapting its customer acquisition strategies to remain competitive in a changing market landscape, particularly in response to aggressive offers from lower-scale players [76][77]

The Western Union Company (NYSE:WU) Q4 2025 Earnings call February 20, 2026 08:30 AM ET Company ParticipantsBryan Keane - Head of North America Payments Processors and IT Services ResearchDarrin Peller - Managing DirectorDevin McGranahan - CEOJames Faucette - Managing DirectorMatt Cagwin - CFORayna Kumar - Managing Director of Fintech Equity ResearchTimothy Chiodo - Managing DirectorTom Hadley - VP of Investor RelationsWill Nance - VPConference Call ParticipantsTien-tsin Huang - Senior AnalystOperatorGood d ...

The Western Union Company (NYSE:WU) Q4 2025 Earnings call February 20, 2026 08:30 AM ET Company ParticipantsBryan Keane - Head of North America Payments Processors and IT Services ResearchDarrin Peller - Managing DirectorDevin McGranahan - CEOJames Faucette - Managing DirectorMatt Cagwin - CFORayna Kumar - Managing Director of Fintech Equity ResearchTimothy Chiodo - Managing DirectorTom Hadley - VP of Investor RelationsWill Nance - VPConference Call ParticipantsTien-tsin Huang - Senior AnalystOperatorGood d ...

Core Insights - Western Union reported adjusted EPS of $0.45, beating the consensus estimate of $0.43, but its core Consumer Money Transfer business declined 7% year-over-year to $871.5 million, indicating deeper structural challenges [1][2] - The company's fourth-quarter revenue fell 5% year-over-year to $1.01 billion, contributing to a full-year revenue decline of 4% to $4.05 billion [1][2] - Operating cash flow dropped 48% from $1.05 billion in 2021 to $406.3 million in 2024, raising concerns about the sustainability of its 9.9% dividend yield [1][2] Financial Performance - The net income collapsed 70% to $114.4 million due to restructuring charges and asset impairments related to winding down Russian operations [1] - Adjusted operating margins improved to 20% from 17% a year earlier through aggressive cost-cutting measures [1] - The company returned $529 million to shareholders in 2025, with $304 million in dividends and $225 million in buybacks [1][2] Digital Transformation Efforts - Western Union launched a US Dollar Payment Token (USDPT) on the Solana blockchain to compete in the $900 billion global remittance market [1] - The Branded Digital segment now accounts for 30% of Consumer Money Transfer revenues, showing growth of 7% in revenue and 13% in transaction volume [1] - The company is also building a Digital Asset Network for on-chain cross-border payments and opening a Global Capability Center in India focused on AI-led innovation [1] Strategic Acquisitions - Western Union is acquiring Intermex, expected to close in Q2 2026, which raises questions about the strategy of consolidating physical retail while transaction volumes migrate online [1][2] - Consumer Services revenue surged 15% in Q4 to $136.9 million, driven by the Eurochange Limited acquisition, indicating successful M&A targeting adjacent markets [1] Future Outlook - Management issued 2026 guidance for 5% to 8% GAAP revenue growth and adjusted EPS of $1.75 to $1.85, contingent on the successful closure of the Intermex acquisition [2] - Analyst consensus is largely negative, with a majority rating the stock as "Reduce" and a 12-month price target averaging $9.96, indicating skepticism about future earnings stabilization [2] - The company faces a critical period over the next 18 to 24 months, where the success of its digital initiatives and the integration of Intermex will be pivotal for its stock value and dividend sustainability [2]

Core Viewpoint - Western Union is highlighted as an attractive dividend investment due to its high yield of 9.7%, significantly above the S&P 500 average of 1.1% [1] Group 1: Dividend Attractiveness - The dividend yield of Western Union is appealing for income-focused investors, supported by a reasonable payout ratio of around 40% [2] - The last dividend increase occurred in 2021, but the high yield may offset concerns about the lack of recent increases [2] Group 2: Business Overview - Western Union operates as a money transfer company, generating $1.03 billion in revenue in Q3 2025, indicating a large customer base reliant on its services [3] - The company has been adapting its business model to enhance its digital offerings, responding to increased competition from digital-native competitors [4] Group 3: Revenue Trends and Challenges - Revenue has been declining over the years, primarily due to competition and the need to lower fees, which has negatively impacted sales [4][5] - The gross profit margin has decreased from approximately 45% a decade ago to the low 30% range recently [5] Group 4: Valuation and Growth Outlook - Western Union appears to have reset its business, but future growth prospects are uncertain and expected to be modest [6] - The stock's price-to-earnings and price-to-book value ratios are below their five-year averages, indicating a potential value opportunity [6] Group 5: Investment Considerations - For yield-focused investors, Western Union presents an attractive risk/reward profile, but monitoring dividend coverage and revenue trends is crucial [7] - If revenue stabilizes, Western Union could become a reliable cash-generating stock, though significant business growth is not anticipated in the near term [7]

Core Viewpoint - Western Union is expected to report its fourth-quarter 2025 results on February 20, 2026, with earnings estimated at 43 cents per share and revenues of $1.04 billion [1]. Earnings Estimates - The fourth-quarter earnings estimate has seen one downward revision and no upward revisions in the past month, indicating a year-over-year earnings increase of 7.5% [2]. - The Zacks Consensus Estimate for quarterly revenues suggests a year-over-year decrease of 2.1% [2]. Annual Projections - For the full year 2025, the Zacks Consensus Estimate for Western Union's revenues is $4.08 billion, reflecting a 3.1% year-over-year decline [3]. - The consensus estimate for 2025 EPS is $1.73, indicating a year-over-year decrease of 0.6% [3]. Earnings Performance History - Western Union has beaten the consensus estimate in two of the last four quarters and missed twice, with an average surprise of 0.6% [3]. Earnings Prediction Model - The company's earnings prediction model suggests a likely earnings beat due to a positive Earnings ESP of +1.51% and a Zacks Rank of 3 (Hold) [4]. Revenue Breakdown - Consumer Services revenues are projected to increase by 23.6%, while Consumer Money Transfer revenues and C2C transactions are expected to decline year-over-year [7]. - The Zacks Consensus Estimate for Consumer Money Transfer revenues indicates a 5.2% year-over-year decrease, while the estimate for C2C transactions shows a 2.5% decline [8]. Geographic Revenue Trends - Revenues are expected to decline year-over-year in North America, the Middle East, Africa, South Asia, East Asia, and Oceania, contributing to lower overall revenues [9]. Operating Income Insights - The consensus mark for operating income from the Consumer Money Transfer segment indicates a 6.4% year-over-year decline, while the model predicts a 7% fall [9]. - Conversely, the Consumer Services segment is expected to see a significant increase in operating income, with estimates suggesting a 163.4% year-over-year surge [10]. Expense Management - The model estimates a 2.4% year-over-year decrease in total operating expenses, attributed to lower service costs and SG&A expenses, which may support bottom-line growth [11].

Core Insights - A new federal excise tax of 1% on international money transfers funded with cash, money orders, or cashier's checks took effect on January 1, 2026, impacting U.S. consumers who rely on remittances [1] Group 1: Tax Implications - The 1% tax will significantly increase costs for millions of U.S. money transfer consumers who support family overseas [1] - The tax applies only to cash-based transfers, allowing digital transactions to avoid this fee [2] Group 2: BOSS Money App Features - BOSS Money app enables users to send money internationally without incurring the new tax by using debit cards or bank accounts [2] - The app is designed to provide low rates, transparent pricing, and secure technology, enhancing user experience [3] - BOSS Money has received over 110,000 five-star reviews, indicating high customer satisfaction [4] Group 3: Service Overview - BOSS Money offers fast, secure, and reliable money transfers from the U.S. and Canada to various regions including Latin America, the Caribbean, Africa, and South Asia [5] - The service includes multiple payout options such as cash pick-up, mobile money, and direct deposits to bank accounts and debit cards [6] - BOSS Money provides features like real-time transfer tracking, bilingual support, and a referral program that rewards users for successful referrals [6]