Payoneer (US:PAYO)2025-05-07 13:32Financial Data and Key Metrics Changes - Revenue grew 16% year over year excluding interest income, reaching $247 million, with adjusted EBITDA of $65 million and a 27% margin [10][25][32] - Net income was $21 million compared to $29 million in the same quarter last year, with basic and diluted earnings per share at $0.06 and $0.05 respectively [32] - Customer funds held by the company increased 11% year over year to $6.6 billion, contributing to interest income of $58 million despite declining average interest rates [28][29] Business Line Data and Key Metrics Changes - B2B revenue increased 37%, driven by growth in APAC, EMEA, and Latin America [11] - SMB volume grew 7% year over year, with B2B SMB volume up 21% and merchant services volume up 88% [26] - The take rate increased to 1.25%, up one basis point year over year, with SMB customer take rate up 11 basis points [27][28] Market Data and Key Metrics Changes - APAC and Latin America customer regions each grew revenue over 20%, representing about a third of total revenue [17] - Approximately 40% of revenue comes from helping customers sell to non-US markets, indicating a strong global presence [18] Company Strategy and Development Direction - The company aims to become the essential partner for cross-border SMBs, leveraging core assets to navigate the changing trade landscape [6][10] - Focus on quality customers and targeting high-value segments by industry, region, size, and product need [12][33] - Recent acquisition of a licensed China-based payment provider enhances the company's regulatory footprint in key markets [19][21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in long-term opportunities despite current macroeconomic uncertainties and potential impacts from tariffs [33][36] - The company is suspending its previously issued full-year 2025 guidance due to high uncertainty around global trade policies [33][35] - Management noted that SMBs are resilient and adapting to changes, with expectations for continued growth in the second quarter [34][37] Other Important Information - Total operating expenses increased 14% to $217 million, driven by higher transaction costs and labor-related expenses [30][31] - The company is focused on diversifying its business and investing in core capabilities to support customers [36][37] Q&A Session Summary Question: Customer reception to price increases and pricing power - Management stated that the pricing strategy remains customer segment-focused, with no immediate changes despite macro uncertainties [39][41] Question: Trends in customer onboarding and retention - Management highlighted strong net revenue retention among large customers and ongoing efforts to improve retention [42][43] Question: Clarification on the $50 million revenue impact from tariffs - Management explained that the $50 million figure is based on various assumptions regarding customer behavior and market dynamics [46][49] Question: Breakdown of revenue from China to the US - Management indicated that larger sellers in China are expected to be more resilient to tariffs, with a diverse range of sellers supported [60][62] Question: Impact of tariffs on overall margins - Management noted that while there could be impacts from tariffs, they do not anticipate a material effect at lower levels [77][78] Question: Evidence of pull forward in volumes - Management acknowledged the difficulty in determining pull forward effects due to various external factors impacting volume [80][81] Question: Changes in the number of ideal customer profiles (ICPs) - Management clarified that the focus is on maximizing profitable revenue growth rather than the quantity of ICPs, with significant growth in revenue from larger customers [84][86]