For Remitly and Payoneer, cross-border payments volume and revenue soared during the third quarter, according to their earnings reports, but activity at their larger legacy rival Western Union was more tepid.
Remitly, which caters to consumers seeking to send payments to people in other countries, reported third-quarter send volume jumped 42% over the year-earlier period to $14.5 billion, according to an earnings press release issued last week. That increase was the company’s highest in eight quarters as it logged a record number of new customers, Remitly Chief Financial Officer Vikas Mehta told analysts on an Oct. 30 webcast discussion of the results.
The activity pushed Seattle-based Remitly’s revenue up 39% over the year-ago quarter to $336.5 million, the company said. The company isn’t necessarily counting on the heightened use to continue in the fourth quarter, Mehta said.
The company experienced some “tailwinds, especially with the strength in the U.S. corridors,” Mehta said on the webcast. “While some of those tailwinds could continue, we thought it prudent not to include or bake them in into our Q4 outlook.”
The activity led to net income of $1.9 million for Remitly for the third-quarter, compared to a loss of $35.7 million for the year-earlier period, according to an earnings presentation.
At Payoneer, which targets its cross-border payments service at the business-to-business market, the company reported record quarterly volume as that third-quarter metric rose 25% to $20.4 billion, according to a Tuesday earnings press release.
That jacked up Payoneer’s quarterly revenue by 19% to $248.3 million, more than tripling net income to $41.6 million for the quarter.
New York-based Payoneer, which has been expanding by way of acquisitions, has increasingly sought to satisfy larger companies’ cross-border needs, as part of a revised strategy introduced by CEO John Caplan. Before Caplan took the top post last year, Payoneer had focused more on providing payment service to small and mid-sized businesses using e-commerce marketplaces.
“On the heels of volatile results in 2023, year-to-date results have been more predictable, and we continue to believe the opportunities remain vast,” analysts at financial firm William Blair told their clients in a Tuesday note, referring to the Payoneer results.
Meanwhile, Denver-based Western Union reported third-quarter revenue slid 6% to $1.04 billion as an income contribution from Iraq decreased compared to the year-earlier period, according to an Oct. 23 press release. Still, the company’s net income for the quarter increased 55% to $264.8 million as its expenses decreased and its provision for taxes swung significantly.
As the 171-year-old company seeks to increase the appeal of its newer digital payments options, it’s making some progress, with that offering charting an 8% increase in revenue for the quarter. Still, it only makes up a quarter of revenue from its main consumer money transfer segment, which shrunk during the quarter.
The company’s consumer money transfer business accounts for 90% of its revenue while ancillary consumer services provide another 10%, the release said.
