Remitly Global Aktie

Good day, and thank you for standing by. Welcome to the Remitly Third Quarter 2026 Earnings Call. [Operator Instructions] Please be advised that today's call is being recorded.

I would now like to hand it over to your first speaker, David Beckel, Head of Investor Relations. Please go ahead.

Good afternoon, and thank you for joining us for Remitly's Third Quarter 2026 Earnings Call. Joining me on the call today are Sebastian Gunningham, Chief Executive Officer of Remitly; and Vikas Mehta, Chief Financial Officer. Results and additional management commentary are available in the earnings release and presentation slides, which can be found at ir.remitly.com. Please note that this call will be simultaneously webcast on the Investor Relations website.

Before we start, I would like to remind you that we will be making forward-looking statements within the meaning of the federal securities laws, including, but not limited to, statements regarding Remitly's future financial results and management's expectations and plans. These statements are neither promises nor guarantees and involve risks and uncertainties that may cause actual results to vary materially from those presented here. You should not place undue reliance on any forward-looking statements. Please refer to the earnings release and SEC filings for more information regarding the risk factors that may affect results. Any forward-looking statements made in this conference call, including responses to your questions, are based on expectations as of today, and Remitly assumes no obligation to update or revise them, whether as a result of new developments or otherwise, except as required by law.

The following presentation contains non-GAAP financial measures. For a reconciliation of non-GAAP financial measures to the most directly comparable GAAP measures, please see the earnings press release and the appendix to the earnings presentation, which are available on the IR section of the website.

Now I will turn the call over to Sebastian to begin.

Thank you, Dave. Thank you for joining our third quarter earnings call. We reported revenue of $510 million, up 22%. Net income was $68 million, a sevenfold increase. Q3 was another record quarter for Remitly with customers send volume and revenue reaching all-time highs. These results reflect the trust our customers place in us to move money safely, fast and at the right value. They also reflect the growing scale of one of the world's largest cross-border networks.

Just as important and less visible in the numbers is our momentum in product development. This quarter, our team shipped more than twice as many updates and new features as last year and 30% more than last quarter. That speed powers our flywheel. New products attract new customers, more customers drive more volume, more volume lowers our cost. That gives us more capacity to invest in new products and the flywheel spins faster. It's also how we're evolving from a remittance company into a global financial services provider for people and businesses whose money crosses borders.

I'll start with an update on our 3 growth areas: consumer remittances, business payments and cards. First, consumer remittances. Our consumer business ranges from everyday senders who send less than $300 per transfer on average to customers sending up to $300,000 in a single transaction. All of them rely on the breadth, speed and reliability of our network. This quarter, that network got bigger and faster. We launched sending from Brazil. It's our first country where customers can both send and receive in the Remitly app. We added thousands of customers in the first few weeks with no paid marketing. Seven new payout options from Angola to Ecuador extended our reach to 11 million more accounts.

On speed, nearly 84% of our transfers now arrive in under a minute, up more than 50 basis points from last quarter. And U.S. real-time rails have cut U.S. bank deposit times from hours to seconds.

Large transfers are a new focus for us. Large transfer volume has grown more than 50% over the last 12 months as we remove friction and raise send limits. This month, we launched FX protection and guaranteed instant bank transfers for customers who regularly send more than 5,000 at a time. It gives them what they value most, rate certainty and speed. More benefits are coming, and we're bullish on this category. We've also broadened how we define our consumer remittance opportunity. It now includes recipients, not just senders. Recipients are a large untapped opportunity to build and monetize a 2-sided network. Each sender sends money to 2 or 3 recipients on average. Early data suggests engaged recipients go on to bring in new senders. So growth on one side can fuel growth on the other.

Now growth can start from the receiver side, too. Anyone in the world can now request money through the Remitly app and every request can bring a new sender into the network. Send with text works the same way. It makes sending and receiving money as easy as sending a text.

In the past year, our network connected more than 50 million senders and recipients in more than 175 countries and over 100 currencies. It's a core differentiator for Remitly. We know our senders deeply. New features like requesting money and send with text, let us start building direct relationships with recipients, too. We'll keep launching products that lift the financial lives of people on both ends and strengthen our flywheel.

Our second growth area is business payments, a more than $40 trillion opportunity. It brings in businesses and freelancers as a new customer base. Our business offering has 2 parts. The first is our Remitly branded product, where businesses send and receive money directly through Remitly. We're now in 26 countries with more than 30,000 business users and growing. It's a large underserved category, and it runs on the same network as our consumer business. Every business we add increases our scale and lowers our cost per dollar set.

The second is a platform offering. Any company can plug into our network through our APIs to move money globally. Last quarter, Etsy signed as our first platform partner, which will allow Etsy sellers in 15 countries to get paid through Remitly. It's the first of many partnerships and each one adds volume to our network. And we're just getting started. Many of the businesses that send money with us increasingly want to run more of their finances with us. That includes domestic payments, holding balances and paying international teams and contractors. In 2027, we plan to expand into payroll as we work towards becoming the main account for these businesses. Over time, we believe business payments could be as large a revenue source as consumer remittances.

Our third growth area is our new cards business. Last quarter, we launched the Remitly Global Card. It's a powerful all-in-one card that brings everything across-border life needs into one place. Cardholders get our best remittance prices to more than 175 countries, plus everyday spending and a full set of features that makes moving money easier. Our membership plan adds access to credit, so members can send money home before payday. This quarter, we added SmartRate and eSIM to membership benefits with more to come. Adoption is growing quickly. We're encouraged by early engagement and the lift we're seeing in remittance volume. We believe the Global Card belongs in the hands of all of our more than 50 million senders and recipients, and we're confident it will become a meaningful stand-alone revenue driver.

One network, 3 growing revenue streams. Our business has never been stronger. After almost 9 months as CEO, listening closely to investors in the industry, I've heard 4 main questions about the durability of our growth. I want to address each one directly, pricing, stablecoins, neobanks and our reliance on consumer remittances. First, pricing. Some investors worry about the long-term remittance pricing. Price is one of many levers we and others can pull to win customers, and customers often reward the lowest price.

Protecting margin in that environment takes 2 things. The first is the lowest cost to serve. Our scale and continuous cost improvements give us an advantage there. The second is the right price for the right customer at the right time. Over the past year, we built a proprietary pricing engine that uses advanced data, AI and machine learning to price every transaction in real-time. Together, they've helped grow transaction margin dollars by $75 million over the past year or 27%. Our competitive landscape rewards the scale player with the best cost structure. Quarter after quarter, we've shown we can compete on price and still expand our margins, and that advantage widens with every dollar we move.

Next, stablecoins. Some believe stablecoins will let anyone move dollars instantly and almost for free, making remittance providers unnecessary. We see it differently. A dollar stablecoin is a digital dollar. A blockchain is simply a new rail it moves on. We own the customer relationship and stablecoins becomes one more way our network moves money. Most importantly, we deliver the last mile. We get money to people where and how they need it. Stablecoins solve the middle of the journey, moving value quickly between treasuries. They don't solve the hard parts. Someone still has to take in local currency and run KYC and sanction checks. Someone has to stay licensed in every country and convert to pesos, rupees or naira. And someone has to deliver to a bank account, wallet or cash pickup point in a small town. That work is our network, and it's what makes us hard to copy.

A blockchain alone doesn't put cash in the hands of a family in rural Mexico or India. So we use stablecoins to strengthen an already diverse network. They give us more ways to move money faster and at a lower cost. We're a founding member of Open USD consortium. We use USDC and treasury to settle prefunding faster. And we've launched a stablecoin wallet and card for recipients in select Latin American countries.

We choose the fastest, lowest cost compliant path for every transfer. Any technology that lowers cost helps the scaled operator with the best cost structure most. Stablecoins are only about 1% of consumer cross-border payments today. This is an opportunity we're building on early, not a threat we're reacting to.

Next, neobanks. Some fintechs and neobanks are offering 0 fee transfers to win customers. But many of these free offers are only worked between the neobanks own accounts. They often come with limits or an FX spread attached. Our customers send to families who bank wherever they bank use a local wallet or pick up cash. Remitly reaches more than 5 billion potential recipients through banks, mobile wallets and nearly $500,000 cash pickup options, often in seconds. A bank present in 1 or 2 countries can't offer that. Banks and payments apps generally stop at the border. We start there.

Step back and you'll see neobanks and fintechs converging on the same products, accounts, cards, lending, investing, multicurrency balances and money transfers. What differs is where each of us started. Cross-border money movement is arguably the hardest to build. It means mastering the complexity of licensing, compliance, fraud prevention and payout in every country. We spent a decade building it. Very few companies can move money to billions of people in more than 175 countries in seconds with one tap. We built that network first. Now we're putting everything else our customers need on top of it, and each new offering comes faster.

This morning, we launched a new product that proves the point. For the first time, Remitly moves money within a country, not just across borders. Remitly Global Card customers in the U.S. can now send and request money from each other anywhere in the country. Paying your roommate down the street and sending money to family in Manila now happen in the same place. Think of it as a Venmo without borders, one app to pay people in the U.S. and in more than 175 countries. This is more than a new feature. It says a lot about where we're headed. Domestic payments happen more often than international transfers. So Remitly now becomes part of our customers' everyday financial lives, and it took a small team just a few weeks to build. That's what makes the global card so powerful. Remittances are our foundation and the Global Card is how we build on it. It brings the account to our customers. It offers card-to-card transfers wherever they are on a global network, few closed-loop players can match.

As we compete with neobanks for customers' everyday financial lives, we have 3 advantages: a head start on the hardest product, a licensed payout network in more than 175 countries and more than 50 million senders and recipients to offer it to. Our goal is for every Remitly customer on both sides of the transfer to hold a Global Card.

Our network took years to build, and there are no shortcuts, and the results speak for themselves. Active customers grew 17% year-over-year during the same period, many neobanks launched free offers in some of our largest geographies. We compete on a durable economics, not a subsidy with an end date.

Finally, our reliance on consumer remittances. Some see Remitly as a highly successful single product company, but they see it as one that's exposed to price pressure and shifts in global migration. Consumer remittances is our engine. It's growing 20%, more than twice the industry rate. And we have plenty of room to keep growing in a market worth more than $2 trillion a year. And it is no longer our only engine. Our future rests on 3 connected revenue streams running on one network, consumer remittances, business payments and the Remitly Global Card. Each one is a large opportunity in its own right. The same licenses, partners, treasury and risk models that serve a $300 transfer serve a $300,000 one.

Once you can move $1 across the border, moving $1 million is simple. That's why we believe business payments could one day be as large as our consumer business and the Global Card turns more than 50 million senders and recipients into potential cardholders, giving us a new way to serve them every day, not just when they send money home.

Each new revenue stream run on a network we've already scaled and optimized. So it adds low-risk, high-margin revenue. It also spreads our exposure across more customers and more send countries. We expect our new businesses to grow from about 5% of revenue this year to more than 10% in 2028.

These are the right questions to ask about any business, and I wanted to address them directly. In answering them, I've also laid out our strategy. We want to become an increasingly essential financial services provider for people whose lives cross borders. I conviction that all 4 questions come down to one, who owns the trusted global money movement network and how valuable is it? Owning it means being accountable for everything it takes to move money safely at scale. That means knowing the customer, maintaining hundreds of licenses and monitoring millions of transactions a week. Remitly owns one of the largest licensed money movement networks in the world. It's taken more than a decade to build, features may be easy to copy a network like ours is not. That network is our foundation. We're now building a global financial services company on top of it, the account, the card and business payments, all on rails we already own. Every product we add makes the network more valuable, and the network makes every new product faster and cheaper to launch.

Let me close with this. I can't look back on this quarter or ahead at our strategy without recognizing the exceptional team behind it. Our people are relentlessly focused on our mission. They give customers the trust, reliability and speed they can't get anywhere else. Together, our network and our team are our durable competitive advantage. Every transfer makes that advantage stronger. The results show it. Revenue has grown at a 35% compounded annual rate over the last 5 years. To everyone at Remitly, thank you for what you've built and for what you're building next.

Vikas will walk you through our early outlook for next year. It reflects an environment that's hard to predict this far out. But our confidence doesn't depend on the environment. It depends on what we built, a battle-tested network, a team that executes quarter after quarter and customer trust earned one transfer at a time. None of it can be copied or rushed. We'll keep winning share in remittances. We'll keep diversifying our revenue, and we'll keep building the financial home for a cross-border world.

I'll now hand the call over to Vikas.

Thank you, Sebastian, and good afternoon, everyone. We delivered another excellent quarter of profitable growth and strong free cash flow with revenue growth and adjusted EBITDA margin together exceeding the Rule of 45, reflecting solid execution and a rigorous attention to cost discipline. Third quarter revenue was $510 million, $4 million above the midpoint of our guidance and up 22% year-over-year. Adjusted EBITDA was $121 million, $28 million above the midpoint of our guidance at a 24% margin, our highest ever.

Let me share an overview of our third quarter results and then provide our outlook for the fourth quarter of 2026 and our updated guidance for the full year. As we have done in the past, we will also provide an early perspective on 2027. Top line growth accelerated sequentially this quarter, driven by continued strength in core send and the scaling of our growth businesses. Our performance relative to our guidance reflects the continued benefits of regulatory changes in the United States, supporting a shift towards digital remittances and momentum at Remitly business.

Unpacking revenue drivers for Q3, send volume grew 25% to $24.4 billion. Send volume per active customer reached a record of more than $2,350, up 7% year-over-year, driven by higher average transaction sizes, which reflects a higher mix of business and large transfers and an increase in transactions per active customer. Quarterly active customers grew 17% year-over-year to 10.3 million. Quarterly active customer growth remained strong, supported by share gains across geos, especially in the U.S. to Latin America corridors. Our take rate this quarter was 2.09%.

Now let me dive deeper into our revenue performance from a geographic and new product perspective. From a send perspective, U.S. revenue grew 25%, reflecting continued share gains in key geographies. Rest of the World revenue grew 23% year-over-year, accelerating from prior quarter's pace. We continue to see robust activity in the UAE, where revenue grew over 150% year-over-year and are excited about the opportunities afforded by our expanded licenses there.

On the received side, revenue from transactions to regions outside of India, the Philippines and Mexico once again grew faster than overall revenue growth and comprised over half of our revenue mix.

Now moving on to our newer businesses. We continue to gain traction and scale, and our growth accelerators are on a track to comprise around 5% of total revenue in 2026 and exceed 10% of total revenue by 2028. I'll start by highlighting the strong performance of Remitly business this quarter, which once again saw an acceleration in volume growth. We ended the quarter with more than 30,000 Remitly business users, a little over a year in Remitly businesses gaining momentum through continuous improvement of the user experience and a growing diversified customer base. Over the last 2 quarters, time to onboard has improved 38%, and we launched multiple product enhancements, including Send by Link, Bulk Send and QuickBooks Online integration.

Next, let me share an update on large transfers, who we previously referred to as high-value centers. Large transfer volumes grew 25% year-over-year. As we shared last quarter, large transfer volumes were affected by Reserve Bank of India's foreign currency mobilization measures, which began in Q2 and concluded in August. Large transfer volumes outside of India grew 80% year-over-year in Q3, an acceleration from Q2's pace. We are seeing particularly strong growth to the UAE, where we completed multiple 100,000-plus transfers this quarter.

Shifting to receivers. Our suite of receiver products has the ability to unlock a direct relationship with tens of millions of recipients. Products like Send with Text and Paytech let us begin building those relationships and the global receiver card, which is now available in 4 countries, provides a new means of monetizing payment flows after a transaction is sent.

Finally, Remitly Global Card, which allows card members to send, spend, save and get paid from the same account. The Remitly Global Card has been available for a little over 1 quarter. And this week, we are expanding general availability to customers across the U.S. Global Card customers can also send and request money from one another anywhere in the country. This is a significant milestone for Remitly as we move beyond international transfers to serving our customers' everyday financial needs. We remain excited about the traction we see with our newer businesses and the opportunities for these offerings ahead.

Moving on to our expenses. We delivered leverage across every single expense category this quarter. These results are the product of a deliberate focus on cost discipline and the widespread use of AI internally, which has driven significant improvements in operating efficiency, particularly in fraud detection, engineering and our support functions.

Turning to our focus of driving profitable growth on Slide 12. Transaction margin dollars grew 27% to $347 million, again outpacing revenue growth with transaction margins reaching 68%, up 312 basis points year-over-year. The expansion in transaction margins reflects strong customer activity, lower transaction losses, improved partner economics and the scale benefits of our network. Transaction expenses this quarter were $162 million and as a percentage of revenue was 32%. Excluding provision for transaction losses, other transaction expenses were $141 million, improving 134 basis points year-over-year as a percentage of revenue. This improvement reflects higher efficiencies across our network as well as a continued shift in mix towards digital receive volumes. Provision for transaction losses was $21.3 million or 8.7 basis points as a percentage of spend volume. We continue to make investments in our data ecosystem and AI/ML models, which are yielding benefits. As our network grows, so does our data graph, giving us more intelligence to improve our fraud prevention.

With that, let me walk you through the specific non-GAAP expense categories. Marketing investments remain disciplined and growth focused. Marketing grew 14.6% year-over-year and was 19.7% as a percentage of revenue, a 119 basis point reduction from prior year levels. Marketing spend per active customer was $9.69, down 1.9% year-over-year, reflecting contribution from unpaid and organic channels. This month, we are launching a new global partnership with Indian cricketer, Jasprit Bumrah, widely regarded as one of the greatest bowlers of all-time ahead of Diwali, one of India's largest holidays. Our LTV to CAC ratio was above 6x, while our payback period remained under 12 months. Lifetime value of new cohorts continued to expand, growing 9% year-over-year.

Customer support and operations expense was $27.3 million and as a percentage of revenue was 5.3%, improving 83 basis points year-over-year and continuing a multiyear trend of steady operating leverage. Our virtual agent Remy reduced average handling times by 22% since launch. Technology and development expense was $56.3 million and as a percentage of revenue was 11%, improving 216 basis points year-over-year. AI-related benefits allow us to ship more and faster with the same headcount. Even as AI usage increases, we were able to reduce all token costs 55% in Q3 by actively managing usage across models.

G&A expense was $42.8 million, flat year-over-year. We delivered significant leverage again this quarter, 180 basis points as a percentage of revenue to 8.4% of revenue, reflecting a continued rigorous focus on operating discipline and the ongoing rationalization of our geographic footprint.

Strong revenue growth, combined with operating leverage and cost discipline led to a record level of adjusted EBITDA of $121 million. Adjusted EBITDA outperformance was driven by higher-than-expected revenue, lower-than-expected transaction losses and higher-than-expected AI-related operating efficiencies.

Net income was $67.6 million, up sevenfold year-over-year, resulting in a 13% net income margin. With several consecutive quarters of solid profitability, we will reference diluted EPS as a key performance metric going forward. Diluted EPS is an increasingly relevant lens through which we measure the business. Diluted EPS was $0.30 in Q3, up over 640% year-over-year.

Our North Star remains growth in free cash flow while managing dilution and Q3 delivered on both. Free cash flow grew to $88 million, reflecting strong operating leverage, partially offset by the timing of working capital. Outstanding shares were 214 million, up 2% year-over-year, reflecting our disciplined approach to dilution management and share repurchase activity.

Stock-based compensation was lower year-over-year for the third consecutive quarter. It declined 1% and at 7.8% of revenue was 176 basis points lower as a percentage of revenue than the third quarter of 2025 due in part to lower headcount. For all of 2026, we expect stock-based compensation to decrease modestly in absolute terms year-over-year. In Q3, we opportunistically bought back $14.4 million worth of stock or 612,000 shares. Year-to-date, we have repurchased 4.5 million shares. We continue to be disciplined in how we deploy capital towards buybacks.

Let me now share an update on capital allocation. We recently took 2 important measures to improve working capital management and flexibility in how we deploy free cash flow. First, we upsized our revolver to $1 billion from $550 million. We prefund certain customer transactions to ensure funds are available to recipients in a timely manner, which means most of our cash sits overseas. A larger revolver provides us incremental flexibility to use our cash for other corporate needs.

Second, we increased our share buyback authorization from $200 million to $500 million, reflecting both our confidence in the long-term trajectory of the business and our view that repurchasing shares is an attractive use of capital. Taken together, these actions give us more capacity to return capital while ensuring customer demand is fully met.

With that, I will move to our outlook. For the fourth quarter of 2026, we expect revenue of $531 million to $533 million or 20% to 21% growth. We continue to see strong momentum in our core and expect the continued shift toward digital remittances, growth in newer geographies and the scaling of our newer businesses to once again drive year-over-year growth of more than 20%.

Breaking down revenue growth. In Q4, we anticipate send volume growth to exceed revenue growth and revenue growth to exceed quarterly active customer growth. Send volume per active customer is expected to grow in the mid- to high single-digit range, supported by the continued shift in mix towards large transfers and businesses.

For the full year, we expect revenue between $1.989 billion and $1.991 billion, a growth rate of 22%, reflecting strong demand in our core and growing levels of contributions from our newer businesses.

Now let us pivot to profitability and expense guidance, starting with transaction margins. We expect Q4 transaction margins to moderate year-over-year as we face a tough transactional loss rate comparison in the prior year quarter. No transaction loss rates fluctuate quarter-to-quarter. We expect full year transaction margins to be modestly higher than 2025 levels on a normalized basis.

Shifting to marketing. For Q4, we expect marketing spend per QAU to be modestly higher year-over-year as we invest in customer growth, extend our Skip the Line campaign and increase brand marketing. Marketing expense per QAU faces a difficult comparison in Q4 as last year benefited from a deliberate approach to holiday period spend. As a reminder, Q4 is a seasonally high marketing investment quarter. These investments set us up well for 2027.

Putting this all together, we expect Q4 adjusted EBITDA to be between $104 million and $106 million or around 20% margin. For the full year, we expect adjusted EBITDA to be between $441 million and $443 million, representing an adjusted EBITDA margin of around 22%, an expansion of more than 550 basis points year-over-year. This improved adjusted EBITDA outlook reflects a more favorable outlook for revenue, our commitment to cost discipline and our ability to leverage AI as we invest in growth. Our outlook also assumes normal levels of transaction losses for Q4.

Now let me share some early thoughts on 2027. We expect revenue growth to be in the high-teens range for next year. This outlook assumes continued strength in our core and strong growth in newer businesses. As always, foreign exchange volatility, geopolitics and macroeconomic conditions are difficult to predict 1 year in advance. And while we expect to continue to take share through digital conversions of cash remittance volumes, we face a tough comp associated with the initial implementation of the 1% remittance tax. Therefore, we currently expect revenue growth to be at the lower end of this range. This is an early look, and Q4 results will be important in shaping our formal guidance for the year.

Moving to profitability. We expect 2027 adjusted EBITDA margins to be broadly in line with our guidance for 2026. As noted on prior earnings calls, adjusted EBITDA in 2026 benefited from lower-than-expected expenses due primarily to the reassessment of business initiatives following Sebastian's arrival. In 2027, we expect a more normalized level of investment spending. But as always, we will remain disciplined, ensuring a high return on capital and a balance between growth and profitability.

Before I close, let me come back to the framework we laid out at Investor Day last year. We remain committed to delivering more than a Rule of 40 outcome through 2028, defined as the sum of our revenue growth CAGR from 2025 to 2028 plus our 2028 adjusted EBITDA margin. This framework reflects a balanced approach to growth, profitability and investment and is the way in which we run the business.

To summarize, in Q3, we delivered another quarter of excellent results across our key financial metrics. We delivered record revenue, adjusted EBITDA and adjusted EBITDA margin and a more than sevenfold year-over-year increase in net income, underscoring the power and scalability of our business model.

With that, Sebastian and I will open up the call for your questions. Operator?

[Operator Instructions] First question will come from the line of Ramsey El-Assal from Cantor Fitzgerald.

Vikas, I was wondering if you could help us quantify the in-quarter impact from the Reserve Bank of India's temporary foreign currency measures. I know that they ended a month earlier than you anticipated, but I'm just trying to figure out what the result would have been had that headwind not been in numbers.

Yes. First of all, thank you for the question. And I just wanted to start off with just reiterating that it was an excellent quarter, record revenue. Most importantly, the transaction margin dollars growing at 27% and a record high transaction margin percentage.

If you look at specifically the high-value centers or as we now call it large transfers, there are 2 parts to the story. One is the India story where your question is and one is beyond that. And let me just share the beyond India story first very quickly and then get to your questions. Beyond India, we continue to see really strong strength in large transfers, and this was mostly because of just a very deliberate focus that we are putting on this part of the business as well as newer features that we have introduced, including remedy reserves and price guarantees. And that resulted in a growth of over 80% volume growth for the non-India side of business.

Now if you look at India specifically, and I did visit India recently meeting a lot of the partner banks and got the firsthand commentary as well. And they saw a very interesting dynamic, which is for us, the scheme was across 2 quarters, both Q2 and Q3. And as you know, we provided some commentary in Q2. The first phase of that scheme garnered around $50 billion in volume. And then RBI announced that it would shorten the duration of that scheme by a month. And then there was a massive acceleration in that amount and that reached more than $125 of mobilization through that scheme, which to give you some context is greater than 80% of annual remittances to India. So definitely, the scheme had a sizable impact and drew a pretty large balance, which the money transfer operators really did not participate in.

Now it's hard to quantify what was the actual impact on the growth rate, but the dimensions that I gave you hopefully help you understand the magnitude of it. I just want to reiterate again that even if you -- including the impact of that, we were able to grow overall 50% plus over the last 12 months from a volume growth perspective. So we feel very optimistic about the large transfer business. And while there will be a pull forward impact from this, we feel over time it will deliver results.

And our next question will come from the line of Tien-Tsin Huang from JPMorgan.

Thanks for sharing the '27 views. I'm just curious, thinking about the high-teens revenue growth and the similar margins as '26 as you've called out. Should we consider this initial look as a deliberate investment year comment given the margin discussion plus some of the AI potential? I know there's a lot of focus on the accelerator. So I just want to understand what the framework is.

Thank you for the question. And if you look at FY '27 view, first of all, I'd say that it's an early look to help you think about the 2027 growth. Now the key point is with excellent performances through the year, including Q3 and Q4 foundation that we will set that will then create the right setup for FY '27.

I'll share a few thoughts on the revenue assumptions and profitability assumptions, which will help you model things better. The first is, we've seen continued strength in the core business, and we expect that to continue. And we will continue to focus on the newer geographies that we are investing in like UAE. So feel very good about that. In addition to that, we have the newer businesses and we expect strong growth to continue. And as we have shared, this will contribute more than 10% of the revenue in 2028.

Now 2 important points to additionally highlight. The first one is remittance tax will lap. So it will have tougher comps. And secondly, the card business is a newer business that will ramp through '27 and we'll start seeing a material impact from 2028 and beyond. Outside of that, as you very well know, FX volatility, geopolitics are all difficult to model. But overall, we feel very optimistic.

Shifting to profitability assumptions, continued operating discipline, as you have seen from us. But to your point, yes, there will be the reassessment period of priorities is over. And as Sebastian now shifts his attention on these key priorities will be in an investment mode, but in a very thoughtful way, in a disciplined way, similar to what you have seen from us.

Just highlighting a couple of important nuances here. And keep in mind that transaction loss has been a good guide for us over the last few quarters. As we look at 2028 to '27, we are continuing to model in the same range that we have shared, which is the 9 to 13 bps with average of 11 bps. And in fact, if you normalize '26 for that, then you will see, in fact, an expansion in margin in a theoretical way.

And the final point there is, AI has been a really good positive for us from a productivity as well as a cost perspective. We'll continue to see benefits, but 2026 was definitely a very strong year from that. So overall, looking forward to a balanced equation of growth, profitability and investment as we head into 2027.

Yes. And also -- thanks for the question. I'd also add that you've probably seen really an increase in the buildup of new products and features. And we did that over the last 6 months with really no increase in headcount or investment. So we've been very, very frugal in the way we do this. And of course, AI is helping us. When I think about the investment for the next 12 months and then I put my AI hat on, it really is a new equation that's emerging because very small teams can launch stuff very fast. And so, we think -- and you're reflecting this on the new products, we think we have a tailwind building on the speed and the effectiveness of the products that we can launch globally. So it's a very interesting moment as we look at the next 12 months, certainly from a product perspective and an investment perspective.

Our next question comes from the line of Cris Kennedy from William Blair.

Just wanted to follow-up on Tien-Tsin's question. Vikas, can you just kind of compare and contrast your visibility today versus your visibility last year? It's kind of the same setup in terms of your preliminary outlook.

Yes. I think that's a great question. And even reflecting back, one thing comes out very clear that the ability to forecast out is extremely difficult, and we saw so many moving pieces that we hadn't expected like the RBI scheme as well as just the geopolitical dynamics. So clearly, uncertainty remains. And I would say that a few things that we use as our basis for projection that makes us feel very, very confident. First of all, a lot of our business is based on past cohorts and being able to model that cohorts gives us more and more stability of that.

The second thing I'd say that has changed this year versus last year is just the use of AI and ML when it comes to forecasting, whether it is for our business purposes or for our revenue projections. And we feel that over the last couple of quarters, we have been able to really get precise in our forecasting. So that would be a positive change from just getting close to our forecasting accuracy goals over here.

Outside of that, the newer businesses, I'd say, are in a more mature stage or more evolved stage than what they were last year, which gives us more confidence. So overall, a few puts and takes, but feeling very good about forecasting accuracy internally. And secondly, just the strength of cohorts that gives us confidence in our outlook.

And our next question will come from the line of Alex Markgraff from KBC Markets.

Maybe just a quick question on QAU growth. It's a bit slower than anticipated. Just curious if we should be kind of -- the right level we should be thinking about if there's kind of a step down in growth to be considering here with the shift to larger customers and business customers or if there's something sort of seasonal or onetime to consider in the 3Q number?

I'm glad you asked that question because I think there are a few nuances which I want to highlight a bit. But before that, I'll just zoom out and share an important aspect, which is the key metric because sometimes we can look at the smaller part of the equation and that could be misleading. Our biggest level goal is the free cash flow per share. If you look at specific line items, transaction margin dollars is where we are anchored. As I shared earlier, transaction margin was the highest that we've had at 68% and the margin dollar growth was 27%. If you look even sort of more detailed into the volume growth, which is quarterly active users times the spend per QAU, it was 25%. And again, we had a record spend per quarterly active user. And in addition to that, we had record transactions per QAU this quarter. So really very, very good underlying trends of the business.

Now if we go into the nuances, and this gives me an opportunity to share a few important points. The first is, there is a sequential view versus a year-over-year view. And if you look at a year-over-year view, really very strong trends over here. Overall growth of 17% to your point, the mix played an important role where both the large transfers and business customers are driving more strength over here. So it's about the quality of QAU rather than just the QAU number, and that's what helped us to get to a record spend per QAU.

And to give you more flavor of that, the NPAs or the new customers acquired this quarter were higher year-over-year. So we saw underlying strong strength there. And in addition to that, one of the metrics that I like a lot personally, which is the net dollar retention rate was the highest that we have ever seen. So both on the customer acquisition as well as the retention front, it was a really very strong quarter.

Now looking at it sequentially is very important on the nuances. The first point I'd highlight is that, as you will note on Slide #10, we have highlighted that Q2 was revised, and that was the only quarter that was revised due to data migration that we did, and that just the Q2 number, first of all, take note of that on Slide 10.

The second important nuance over there is, with remittance tax, H1 has been really very strong from a customer acquisition perspective, especially on the offline to digital customers. And Q2, in fact, was the record new customer acquisition quarter for us. So there's a little bit of a comparison also aspect there. Overall, really a strong quarter from a quarterly active user perspective, the growth, the quality of acquisition, even as you see the leverage that we are getting in marketing. So we are able to drive acquisition at the right cost. So overall, really fundamentally a very strong business. Acquisition is strong and being able to target the right customers.

Our next question will come from the line of David Scharf from Citizens Capital Markets.

This is Zach on for David. Congrats on the strong quarter. I wanted to dig in a little bit more on the quarterly active users growth. So a little bit of a diversion between the send volume growth and the active users growth, kind of a 900 basis point gap between the 2 versus 800 last quarter. Obviously, not -- still good growth overall, but I wanted to see if we can kind of get more context on how the mix shift might drive growth in send volume per average customer.

Yes. So similar to the previous answer I gave, underlying really strong trends that you can see in the business. And again, I'd highlight the most important metric that we look at is the transaction margin dollar growth, which was 27% and highest transaction margin at 68% that we have ever had. If you look at the volume trends, the volume trends were very strong with record spend per QAU, which was driven again by the record transactions per QAU. And that was in addition to the mix shift that we are seeing where we are seeing north of 30,000 businesses, which are helping drive that as well as large transfer volume, which continues to be in a positive direction. So overall, the fundamentals of the business are very strong.

From a QAU perspective, as I shared, a few nuances, I'll not repeat those. But overall, strong growth at 17% and the key is that, it sets us up really well in our business for future growth. And that's why we are very confident about Q4 as well as '27.

And our next question will come from the line of Aditya Buddhavarapu from Bank of America.

Just a couple for me. Firstly, when you -- if we go back to the EBITDA margin outlook for 2027, could you just break it down in terms of the key areas of investment thinking about? So when we look at the areas like marketing, tech spending, customer support, et cetera, where do you think the focus will be? And in general, which markets or products would you be focusing on?

And second question, could you just go back to what you said on pricing. So you mentioned that cost -- the lowest cost to serve ultimately win. So when you think about the future benefit -- scale benefits and the future network cost savings that you get, do you look at reinvesting that into lower pricing? Or do you sort of think you can back in the margin as we go forward?

Yes. So on the 2027 investment priorities, you mentioned marketing. I'd say yes to all. And we're getting -- we're significantly getting this AI tailwind everywhere. We're getting it in CS. We're getting it in products. We're getting it in marketing. And so you have these 2 forces. You have -- we are investing and we're investing across the company, but we're also getting this tailwind from AI. So we have to move the dial pretty much it's almost on a weekly basis at this point because you get very quick responses and very quick outcomes. If you look at how -- look at 2027, even the software factory or the product factory is probably duplicating its output every 3 or 4 months. And so, it's -- I'm being evasive because it's a yes answer to everything you said, but it doesn't necessarily mean that it adds dollars to the investment. It's just we are investing more, but I think we're investing more by also getting much more output from the structure that we have.

And like -- I think like every company in the world right now, you're trying to measure how fast can you adopt AI. And so -- because there are some bottlenecks in safety and there's some bottlenecks in skill sets, but we're at the leading edge of adopting across the business, and you mentioned a few. And so I think our output -- let me put it this way. I think our investment was going to continue very strong, but our output in 2027 may be very interesting to watch.

Our next question will come from the line of Gus Gala from MCH.

I'm just holding the '27 margin broadly in line with calendar '26, just it shakes out to like a 22% incremental. I think that's below calendar '24 incremental margins. I just want to understand what is -- let's just balance it this way. What is the core versus the new products that we'll be investing in? Will we expect maybe just kind of help us think about the snapback in margins over the longer run. And then just reconciling the growth in margin comments a bit with competitors, our sense of the larger legacy guys slowing the price competition, perhaps a little bit squeezed on marketing dollars because they're getting closer to a breakeven level, right, network effects unwinding and all that. Just help us unpack the thinking here. You guys have given good cushion in the past. I think investors really want to know what is conservatism here and what is, "Hey, we're seeing an inflection, hey, the share shift from cash to digital will be slower next year because of the lap." All that would be very helpful.

Yes. Let me -- thank you for the question. Very, very articulate and very clear question. And I'll start and then Sebastian can add more flavor on the investments and other thoughts. So if you look at FY '27, first of all, this is an early look, right? We just wanted to give you the balanced equation of growth and profitability. The second thing I'd say is that, as you look at FY '27, 2 important points. One is transaction loss. I talked about it, which is we are taking this 11 basis point assumption. That's our standing assumption 9 to 13 bps early right now to talk about '27, but we still wanted to give you a view. If you normalize '26, let's say, for example, taking that 11 bps, then it would be a 50 bps expansion and not flat year-over-year. So that's just one flavor to show you the sensitivity of some of the variables and potential upside in some sense.

Second, again, it's early to say right now because we're still not done with Q4. But whether you think about marketing or CS or others, we have leveraged across each line, and we feel really good going into '27. But I think like one quarter early to talk specifics about that. But overall, we feel really good.

The final point which Sebastian talked a lot about in his prior answer, which is AI. We feel AI will continue to give. Now look, we all are looking at AI token costs and how they have reduced. I talked about that earlier, which is like 55% reduction there. And we don't know what that will be next year. So if the cost benefits continue to be at the same pace as this year, we could see better outcomes, but that's something that we did not want to start making predictions around. So overall, we feel really good about '27 and being able to give you an early look at that in Q4 is something that we felt confident this time that we could do that. So we get that.

But I'll hand it over to Sebastian to share additional thoughts on...

Two quick high-level thoughts on -- you pointed out marketing. Marketing is evolving. I mean, AI is changing marketing. And while we have some very well-defined customer acquisition and long-term value guidelines and how we invest, AI is changing that mix, and we think it's a tailwind for the business. Of course, the larger you get, you get the benefits of word of mouth. So we're monitoring that very carefully. I do believe that over time, we will continue to get more efficient and probably get the benefits of AI.

On the investment on the newer businesses, if you looked at the size of the -- these new businesses have the luxury of starting from a white sheet of paper for the most part. And so they've been assembled as AI-first teams. And so if you looked at the investment, your reaction, you should probably -- given the signals that we're seeing, you should probably say, why aren't you investing more? And the answer to that is because we're moving very fast. We're getting the benefits of AI with these teams. They are generally smaller teams than any business we would have built 10 years ago. So that -- it's very fluid, and that's what we're -- our projections for the investment in 2027 have those tailwinds behind it, but a lot of stuff that we're learning as we go forward.

Thank you. And this concludes the question-and-answer session. Thank you for your participation in today's conference. This does conclude the program. You may now disconnect. Everyone, have a great day.

All right. We are going to get started with the next session. We are very pleased here to have both Sebastian Gunningham and Vikas Mehta from Remitly here, CEO and CFO, respectively. Thanks for joining us. Always a pleasure to have Remitly at the conference.

Thank you.

Congrats on your conference.

Thank you. It's not over yet.

Very impressive.

All right. Sebastian, thanks for being here. You've been in the seat for a little over 6 months. You came into a business that was already compounding at a very high rate. What have you learned in the first 6 months? And what have you changed? And where do you think you can have the most impact from here?

Yes. Well, first, I'd say that when you join a business and you start to peel the onion, 1 or 2 things can happen. The more you peel the worse, the less you like or the more you peel the more you like. And I'd say that I had the luxury of joining a very solid company being put together over many years. The moats are real around the network, the infrastructure, the compliance, customers love the product. So there was a lot of boxes that checked right and I think the company is really a fantastic company.

I'd say that my focus since joining has been number one is diversifying the revenue stream. We have a very good core business, but we've built this amazing network with hundreds of licenses around the world. We can distribute to almost 5 billion bank accounts -- users and bank accounts, about 1 billion wallet users. We have about 500,000 cash pickup points around the world. So diversifying the revenue on the shoulders of that network means we are focusing on higher-value senders. We're focusing on Remitly Business. You saw an announcement this morning. We're now in the platform business also, which means we're using this fantastic infrastructure that we've built to offer it to companies who want to pay people cross-border. Etsy has millions of sellers. We're now plugged into the Etsy ecosystem. We have a pipeline of other companies that are interested.

And finally, we've launched a cards business where we offer our customers a whole bunch of benefits in their cross-border lives with the card. So I say objective number one has been to start a very aggressive diversification revenue. So far, so good. We're seeing some really good signs. Number two is, I think I've AI the company, and this AI journey has many, many angles to it. I'm AI the cost side. We've seen a lot of product launches since I joined the speed at which we're launching features. We launched -- you can now e-mail money. You can send money across the world almost as easily as sending an e-mail. We call it send with Link. We've launched a bunch of features for business.

So on the revenue side, AI has allowed us to reinvent the software factory, generating many more features, many more features improve the product and improved product generates revenue. And hopefully, we'll see growth into the future. On the cost side, like every other company, seeing a lot of efficiencies, what 5 people could do, now 2 people could do -- can do and on down the line. So you're seeing that in our bottom line, in our expansion, in our margin expansion.

And then finally, so number one, as I said, number one is diversification. Number two is the acceleration of AI across the whole company. And number three is continuing to expand this moat that we've built with this distribution network around the world. We're launching new corridors, new send countries, new licenses. We just got UAE. I was in Japan a month ago, we got that license. We got -- so we continue to expand around the world as we move money cross-border. So super fantastic first 6 months. I like the business. I think the market is big. We've earned the right to win. And so we're going to keep at the speed.

Great. And a lot to cover there. I'll try to keep it high level for one more before diving in. So you continue to gain share at 20% plus growth. While some of the legacy cash-oriented players in the industry, clearly seeing lower levels of growth, struggling with share. How would you frame where we are in this offline to digital conversion cycle in the remittance space? And how much runway is left in that shift before it's simply a market growth story rather than a share shift story?

Yes. Well, if we met 3 years ago, we'd already see the data points clearly that the shift from cash to digital is happening. Here we are today, let's say, the world is 50-50. It's not hard to predict that if we were sitting here 3 years from now, that trend is going to continue. Different countries are moving at different speeds. Remember, for us, the cash, we do not deal with cash in the send countries. We only deal with banked customers, but we send the receiving market receives in cash. So when you ask the impact to us is that transition. So in the send countries, a lot of customers are transitioning to digital, and we get the benefit of that, a little bit some tailwinds from these tax benefits.

But I think just generally, customers are just finding it easier to deal with cash and the economics are better. And on the receiving side, it's all over the map. I mean there are some countries that are going all digital. Brazil is a very digital market for us. Mexico is probably 50-50, and it varies across the world. So we're on the right side of that trend. And by being on the right side means you've got all your energy in producing great digital experiences. You've got all your unit economics figured out for digital-only experiences. You've got all your compliance, you've got all your regulatory, you've got all your licenses. So we were born digital, and we're as digital as ever now, and I think we're going to continue to benefit from that trend.

Great. Maybe just before we go any further, I'll get kind of the obligatory macro question out of the way. What are you seeing in terms of activity levels in your customer base? And specifically, Vikas, I think you flagged some softer higher value send volumes in June tied to some of the recent actions by the Indian government. Maybe just unpack what's happening there and what the range of outcomes could be.

Yes. First of all, as you saw, our first half annual results have been outstanding. And as a part of that, our high-value sender story is the one that actually helped us drive strong growth as one of the factors. And what we saw in the second quarter was that with the Indian government using different programs to manage their foreign exchange volatility, they came up with schemes where -- which created funds being moved in a different way than the usual cross-border remittance or payments. And that scheme ended early. It was supposed to end, end of September, but has ended end of August, which means that going forward, we'll not see impact from that, but it will have similar to what we saw in Q2, a little bit of a headwind in the Q3 time frame. But that's, call it, the detailed part of it.

If you zoom out from what we can control, we have made big headways with regards to high-value sender. The first thing is, as you have seen us talk about, we have continued to raise the limits of what people can send. We started with $25,000, $50,000. Now more recently in the last quarter, we talked about transactions, which are north of $300,000. Beyond that, we talked about one customer who sent more than $1 million, and this was a U.S.- India transaction as well. So we are seeing great use cases from additional aspects, we are putting more concierge type services for these high-value senders, so that experience for them is a VIP experience.

Outside of that, every aspect of that transaction, we are refining it and making sure that these can go through quickly. We are giving an additional feature we had it was a wire transfer facility that has just eased things for the senders as well. So overall, very excited about what we have for the high-value sender. It's a key growth accelerator for us in the coming years. As we've said, we're just scratching the surface. We have not really targeted marketing in a big way in those use cases. And as we do that, we'll continue to drive strong momentum in that space.

Yes. All very clear. And just on the point in India, like the guidance assumes 3 months of headwinds, and it sounds like it's going to be 2.

Correct.

Okay. Got it. All right. Sebastian, just coming back to the topic of AI, you framed AI around 3 benefits, kind of speed, trust and cost. I think cost has been the most visible so far. You've seen pretty significant out performance on the OpEx side. How would you frame the opportunity for AI to accelerate momentum and either revenue growth or profitability from here?

Yes. I think that we're all -- this is a journey that we're all on. I'm sure you guys are on it also. And I'd say that the initial killer app is in the software factory, which is this amazing productivity that you can gain in building products and engineering. I think all companies are at different stage. But I will tell you internally, I don't think the week goes by without a wow moment with our engineering teams or with our product building team. So that -- and it looks like the models are going to continue to get better and better. So I anticipate we have many more wow moments ahead. So that's obviously a big tailwind in productivity and cost.

The revenue side, we all have to prove the revenue piece of this. I think that -- I think every CEO right now is trying to say, okay, I got the tailwinds of cost. What do I see on the revenue side? For us, as I see it right now, the speed at which we're launching these features, you see it in the -- especially features that customers love. I mean there's no benefit in launch features that customers don't love. But in the adoption of the features that we're launching, those generate more engagement, they generate more revenue. And so we -- our growth -- I don't -- I can't attribute a specific piece of our growth to AI, but I'm seeing it every day. And I assume that over the next few years, we're going to get very good at measuring the cost of AI and the growth impact of AI.

But for us, it seems quite impactful for the business right now. We launched an entire card business in less than 60 days. And we have 10 million customers, if you picture that 10 million customers with a card that they can use to send, that they can use for liquidity, that they can use for loyalty, that they can use for store money. That's 2 or 3x the size of Remitly right there just with cards, and we were able to do that very fast. That's the kind of impact that AI can have. And we have -- on that card business alone, we've got a very long list of great features that are going to be coming to market every week.

Yes. Makes sense. Related question, the cost is one that we get a lot post print. You raised the full year EBITDA guide to roughly 20% margins -- 21% margins, up more than 400 basis points year-over-year. You're already tracking well ahead of the pace implied by the long-term targets laid out at Investor Day. So how are you thinking about the margin framework from here given the momentum that we've seen over the last year?

I'd say that the way we look at the business is more broader than that. We think about the growth, the profitability and the investment. And we don't look at a quarterly view. We look at annual and medium term and long term. And as we think about that, we did see a lot of benefit from a margin perspective, especially as we were very disciplined on some of the projects. And even all the projects that Sebastian mentioned, whether it was rolling out the card or doing partnerships on Remitly Business or expanding those, we have been very disciplined through that. AI was also a factor, which has continued to help us.

As we look forward, we'll continue to maintain that balanced growth equation or balanced equation with growth, profitability and investment. As you know, second half of the year is a very important time to set the foundation for next year. So clearly, marketing is an area where we'll be very, very focused and we'll be looking at making the right programs and campaigns that set us up well for the next year. In addition to that, as you know, we saw some really positive transaction loss numbers in the first half. And while we are very excited and optimistic, the transaction loss is an area which is volatile. And as we know, keeping that 11 basis point average that we have given as a guide would be the right thing. So all in all, I feel that the story is really great for us where we have been able to drive growth along with expanded margins while we invest into the new businesses. Now while being disciplined, we also know that there's no shortage of growth opportunities and we want to invest, and we will invest.

Makes sense. All right. Let's talk about the core send business, which is still the vast majority of the revenues. When you look at the core business specifically, stripping out the growth accelerators, what are the biggest drivers of durable growth from here? And how do you think about the balance between corridor expansion and share gains within the existing corridors?

Yes. I think -- first of all, you've got to be priced right. This is a customer that likes a good service at a good price. And so I'd say that the first focus to make sure we're very efficient in the service we provide and how we price. And by the service, I mean, the speed, the cost and the broadness of the network that we offer. So that are the core businesses. And that won't change. We'll be focused on that forever. The second piece that's driving the growth is we have a very good app. The stickiness of -- I don't like the word stickiness, but customers come back to us a lot, whatever you want to call it, the long-term value or the stickiness of the customer or the repeatability.

Our numbers are very, very strong. And we know when we get a customer, we can keep it. We can keep -- we built the trust, we've built the network, we built the support. And so that's another key component of the core business. And that's -- you see it in our market share numbers. We're very personalized. We've got all these different, we treat the Mexican corridor, we treat the China corridor, we treat the Japanese corridor, all very uniquely for the needs of that customer.

And then the final one, which is a more obvious answer is you just have to keep expanding the markets we serve. We have 5,000 corridors. We think we're halfway through the potential 10,000 corridors in the year in the world. We deal with hundreds of currencies, but we're launching -- we launched Brazil as a send country. We launched Japan as a send country. We continue to expand the places in the world where you can send money. So those are the 3 things that keep fueling the core business. So far, it looks really healthy. We continue to gain share. We continue to do our customer growth. We crossed 10 million active customers last quarter. That growth seems to be solid. Customers are finding us. They're staying with us, and they're using us to send more money.

Great. It sounds like a lot of momentum. Maybe going over to the Remitly Global card. You launched this a few weeks ago. It looks like a pretty significant step with the debit card, wallet, stablecoin balances, lines of credit, direct deposit, all into one product, like a really significant of the core product, which you just went through. Could you walk through what this product does for the customer, what types of demand that you're responding to with that product? And then importantly, how do you expect it to augment the growth profile of the core send business?

Yes. Well, it's early days. The signals right now are great. The -- as you said, I like the way you put it, it's going to be the best card on the planet for our customer who lives cross-border. And we're very focused on the needs of that customer, how the card can help them, whether it be, as you say, with liquidity, short-term liquidity loans with better rates when they're sending money, better speed, they can use it to spend, they can use it as a USDC card. So we have -- and as I said, we have a long list of things to do it to inject into the card. Early days in the rollout, it's only U.S. We have all the countries in the world to get to. We're super excited about it. I think it's a construct our customers understand. People know that you can accumulate value with cards, know how to use them. We believe we can start to build deposits into those cards, which we're already seeing.

So there's just a lot of wins. And the way -- to the end of your question, this keeps the customer more engaged. The unit economics of the card are as good or better as the unit economics of the remittance business. So you can picture all kinds of scenarios where the card helps the remittance business, the remittance business helps the card. And we think that flywheel can be very beneficial to us. So only upside from here. So far, so good. I've been using the card for a month. It's fantastic. And I think most customers will get to -- we have a free version. We've got a membership. We have a lot of ideas here. But by the way, you should get a card. It's good. It's good. I'll send you a note and have you start using the Remitly card, it's very good.

I'll use it. I find someone to send money to. Okay, high-value senders. I think this is one of the most concrete drivers of growth among the growth accelerators. It's one where you're further along. You've seen a lot of initial success. We talked a little bit about some of the near-term dynamics a second ago with the Vikas. What is your strategy around sustaining the growth in that product longer term? And how do you think about scaling the marketing engine around that product?

Yes, I can share a few thoughts, Sebastian, feel free to add. Overall, the high-value sender business is in its very early innings. We have really not gone in a more deliberate way thus far. And as we are now maturing our product with increased spend limits, our next step will be to create more focused marketing campaigns as well as going after specific use cases. The other aspect is also geographic. We have seen a lot of our high-value senders are naturally in the, call it, domain where the incomes are higher. And this is where it has created some concentration of corridors. Our next step there would be creating more diversification similar to what we did in core over the last 15 years. So as we drive that diversification, the revenue will be more, I'd say, stable and durable along with the growth trajectory.

Finally, I'd say that the -- internally, we have created more focused teams on these use cases, which has created a dedicated focus on reducing the friction for these customers. So to your point, HVS, as we call it, is farthest along across the growth accelerators. Again, we see huge opportunity in this space, especially as we add more marketing muscle to it.

Yes, I think when you create -- when you spend 10 years creating this network to move $1 in 1 second anywhere in the world, it turns out that you can move $1 or you move $1 trillion. It doesn't really -- once you've built the infrastructure, and so for us, this is just expanding our market TAM by going -- by mostly customers finding us so far. We'll get to the point where we start to market to customers. But right now, we're just getting this inbound of people that are just sending a lot more money using this awesome network that we've built. So it's a tailwind for the business. We think it's a big market. And it's -- the quality of our network has just opened up this new TAM for us.

Yes. All right. Let's maybe move to the next growth accelerator, which is Remitly Business. How is your level of confidence in this growth accelerator evolved? And what evidence are you seeing that you might be able to devote greater resources to this? I'm sure the Etsy announcement will maybe play into that.

Yes. Well, the business is -- I mean, I look at the numbers every day. It's really -- it's hitting its stride. You have to get the product, there's so many use cases for small businesses, whether they're paying freelancers, whether people are requesting to be paid in different parts of the world to businesses in the U.K. or the U.S. We have this platform business that we've just launched with Etsy. So there's multiple sides to the business, to Remitly Business, again, standing on the shoulders of this broad cross-border network that we've built. And we're out there. Again, early days, very strong signals.

We're seeing week-on-week growth. I look at the numbers. And so far, so good. We have a lot of features that we continue to -- this is also -- it has a component that's a bit of a partnership business. So the Etsy, when you plug into these big e-commerce networks or gig type companies that have all these employees that are moving money around the world, Remitly Business is not only a consumer for small proprietors or small businesses, it also ends up being a partnership type business. So we're building out all the pieces and seems like a very large market, larger than the consumer market. So we believe we're going to get our fair share of that market, and I think it's going to have a meaningful impact on our revenue, too.

And well one of the best parts about partnerships like this is that the business model is really good. And all of a sudden, we get access to new customers, and there's no CAC, right? There's no customer acquisition cost. That's a big game changer for us. Secondly, it is one to many. And we work very hard to create a partnership like this. And then all of a sudden, step changes in the equation. So from a business model perspective also, partnerships like this are accelerant to the business.

I mean I think maybe we can double-click a little bit on the Etsy partnership. It's a really interesting announcement. Can you talk about who do you view as the customer in this relationship? Is it the marketplace? Or is it the end customer or the small business selling on that marketplace? And there's other competitors in this market. Why is -- what's Remitly's right to compete in that market versus some of the incumbents?

Yes, it's a good question. I mean both the marketplace, Etsy is a customer, of course, as is the merchant who's using Remitly to move money or get paid around the world. The completeness of our network, there are a few competitors. I think that we have as good a network as anybody. I think we can -- we have excellent service for these merchants. So I think it's one of many models that we can have in business. I think millions of sellers now have access to money Remitly. And I think we're going to win our fair share of this market.

Great. And finally, on the receiver strategy. I know this one is a little bit more nascent, more experimental. Scaling 2-sided networks and payments is kind of notoriously difficult. But could you help us dream the dream on what success would look like here 3 to 5 years out if it plays out?

Success would look like -- we have 10 million customers that send money -- send $100 billion to 30 million or so customers in 170 countries. That's the picture of Remitly. And I think success would look like if all those customers had a Remitly account on both sides. Once that happens -- and then if you're receiving money in Argentina and you have a Remitly account, you can still distribute that money to the network that we put in place, whether you want cash or you want to go to bank account.

Once all those pairs are put in place with a Remitly account, we have a lot of optionality on speed, on price, on services, on extra offerings. I'm not going to disclose, but there was one of our partners at one country said, we receive a lot of money from Remitly. We'd like you to offer our customers a preapproved loan on the send side. So by the time the receiver gets the money in this country through this bank, the bank had preapproved the loan. Why? Because we know the sender, they knew the receiver. So once you establish those pairs, there's a lot of there's a lot of optionality that you have in the business. And that's how we're thinking about it. I think there's a lot of positives to it for both the customer, for Remitly, for our network. And as you said, early days, really nice signals. We'll see where it goes.

Great. All right. Vikas, I want to tap you in here on pricing and the philosophy around pricing. Take rate has drifted lower on a reported basis over time. I think you said that's almost entirely due to mix, high-value senders scaling, business customers, digital payout mix. So 2 parts. How should investors think about the underlying pricing trends kind of net of these mix dynamics? And second, how do you expect headline take rate and transaction margins to trend over time?

I'd say we think slightly differently compared to how you framed the question and the way we think about it is in 2 aspects. One is what does it mean for the customer? And second is how do we think internally about the financials. From the customer, we think about the value that is delivered to the customer, which is across the trust, experience as well as providing a fair as well as transparent pricing. And as we think about that, we rigorously manage all these different measures to make sure that the customer gets a great experience and overall value.

As far as the second point with regards to take rate, which is, again, we don't talk about take rate internally as much. We think about free cash flow and more at a customer level gross margin dollars. And the goal is to expand gross margin dollars and grow that on a continuous basis. If you go further into that, I would say that the important thing is if we can do the right things with regards to the value to the customer, we can drive gross margin dollar growth, especially if we are driving continuous scale benefits across the partner ecosystem with transaction expense, with transaction loss, we touched upon that earlier as well as the overall customer support. So overall, it's a broader equation for us with regards to value as well as thinking about gross margin dollars.

Makes sense. Sebastian, you picked up several regulatory license recently, UAE, U.K., you mentioned Japan at the top of the conversation. Can you talk about the priorities from a regulatory and licensing perspective and maybe call out where you see the biggest opportunities where licenses are the big unlock?

Yes. Well, on the regulatory side, the opportunity is you have to be perfect, basically. This is moving money around the world is highly regulated and Remitly from day 1 was built from the bottom up, even the tech to make sure that this is -- that we are world-class. I don't -- you don't get to participate in this business if you're not world-class in this area. We've had a very good playbook of getting licenses, managing them. We have 100-plus licenses around the world. We continue -- we have a long list to still keep going. We've got plans for 2 or 3 years.

These licenses take a long time. The application process is complex. So it's a differentiator for us. We're very good at it. We keep working at it. I think once you get the license, then you got to get the product, then you got to start your marketing engine, then you got to get the customers, you got to build the trust. And market by market is different. If you look at UAE, the major corridors are India, Bangladesh, Pakistan, you got to get that right. You got to get how the customers pay into the process right. Some of these economies are cash first. So you got to go to places where they're depositing their cash and then onboard it on to Remitly. So we know how to do this. We continue to expand it. I think it's going to be part of our growth story. And it is a real differentiator for anybody wanting to move money across borders.

Yes. We're almost out of time, but maybe one final question here on capital allocation. You generated $130 million of free cash flow in the quarter. You stepped up buybacks meaningfully. The share count actually declined sequentially in Q1 this year for the first time. So how are you thinking about capital allocation framework holistically, including thoughts on the potential to see more M&A over time?

Yes, I can start. I'd say that, again, very balanced capital allocation approach. The first most important use of cash for us is our organic growth. We talked about it a lot during the last 30 minutes, but no shortage of growth opportunities in the core, continue to expand markets beyond that growth accelerators are all running on full cylinder. Second best use of cash is buybacks. Again, we'll be very opportunistic and take the benefit of any dislocation in pricing. Those would be the 2. There's a very high bar for inorganic. At the same time, we are always going to be looking around to find the best opportunities, but the bar is very high.

Makes sense. In the last couple of seconds here, Sebastian, Vikas, any final closing remarks?

No. Thank you for the invitation. We're very optimistic, and I think we have a real nice growth opportunity in the years ahead. It's a very large TAM. We have a lot of good ideas, and I'm super optimistic about the trajectory that we're on.

That's great. Well, we can leave it there. Thanks for joining us today.

Thank you so much.

[Audio Gap] the CEO, Sebastian Gunningham; and the CFO, Vikas Mehta. Today's discussion is based on topics that are top of mind with investors. We're going to start with Sebastian and talk about some of the key initiatives, then we'll move to the numbers. Then we'll talk about the core remittance business and finish with some of the growth accelerators.

For those of you on the call, you can e-mail me or submit questions through the portal. We have about 45 minutes and a lot to get through. So why don't we get started and thanks again for joining us.

So Sebastian, this question was asked on the earnings call, and I think it's worth asking again. But what are you most excited about as you head into the second half of 2026 and enter 2027?

Well, Cris, first, thank you for hosting this. Yes, we had an excellent quarter, and we -- the company is hitting on many cylinders. And it's hard to pick one big idea. And I think at this point it's the sum. If you think about our customer, our customer cares about sharp pricing. It cares about moving money fast across the vast network and it cares about a great service. And so the company over the last few months has been iterating on all of these 3 and that they sum up to gaining market share, better trust, more activity. So we think we're in -- we're focused on the right things.

We have a lot of initiatives to keep sharpening our prices across the world, across the 5,000 corridors. We continue to expand our network. We're getting new licenses. The money is moving faster. And our service in many ways, whether it be through the help of AI or all kinds of things that we're doing in customer centers and the features that we're giving customers continues to improve. And the reason in strategy, you want to focus on what's changing, but you also want to spend a lot of time on what's not changing. There will not be a customer in the next 100 years who wants to pay more money for moving -- for transferring money across the world. There will not be a customer who will tell you, please move my money slower. And there will not be a customer that says, give me a worse service.

So those things, we were very clear what's not going to change in our business. And as we get better and better in that, we continue to gain market share and we continue to gain momentum. And I think I could answer this question a year from now, probably in exactly the same way as long as we continue to get better.

Now diversifying the business has been a key initiative since the IPO. And clearly, it's an area that you're focused on. Just talk about Remitly's tech stack and its global network that supports and enables your ability to diversify.

Well, diversifying the revenue stream is very important. And this is a top priority for the company. It's a top priority for me as the CEO. And we've built a fantastic infrastructure to move money across the world. And our initial focus, what we call these core senders, which are these $200 to $300 sends that happen at large scale. And we've got 10 million customers who do that.

But the network that we've built is so good that we certainly found high-amount senders starting to use it. And high amount senders are a different profile. They're sending money to themselves, they're sending money to investments around the world. And so that is diversification number one, which is now we're building a business around that high-value segment.

Diversification number two happened when we started to see that lots of businesses start to use this infrastructure. Businesses can go from small businesses to medium businesses to the very, very large businesses who move trillions a day. And so we found that small businesses, people that use freelancers and there's thousands of use cases, it's really incredible to watch that are using the Remitly infrastructure. So diversification, stream #2, is a small business -- is the small business revenue stream.

And the third diversification has been a receiver world. So we send money, 10 million people send $100 billion a year to 30 million or 40 million people around the world. And we've never really done anything with the 40 million people that are receiving the money. But a combination of the crypto rails and stablecoins and us being able to issue cards has introduced us to the possibility that we could make a business out of the receivers. Early days, we've some great ideas. We've launched the app in 170 countries. We're generating some revenue already. So stay tuned on the receiver side.

And then across all these revenue streams, we've launched our Remitly Global card, and that's a fantastic card for people that live across borders, we call it. So people that do live in one country but have all their family relationships or they travel across borders. And this card is very focused on serving that community, either when you travel with the card, when you need to borrow money short term to -- or liquidity issues, where you have loyalty points where you want to use it card-to-card sends, there's just a lot of features in this card, which we think applies to all our customers.

So to answer your question, very important focus of the company. We do have one big revenue stream, which is the core senders. We've got 3 or 4 in the works, all showing very good traction. All growing fast. We have some other ideas, but our mission is to make sure that we keep diversifying the revenue of the business to make us a much more durable and high-growth business.

And Cris, we have a very quantifiable way to measure that, and we have put a goal of, as you know, 5%, approximately, for this year and then over 10% of the revenue mix by 2028. So definitely a great traction as Sebastian shared and very clear goals for us to diversify.

I'll just add one last point on that, which is -- this is not only a diversification through different customer types or through different product features, it's also a revenue stream diversification. So this is now where we can get into membership revenue, get into interchange, get into float-related interest income. So there's a diversification of income source as well.

We'll dive into each of these growth drivers going forward a little bit later in the discussion. Now your results have clearly outpaced most or all of your peers. Have you seen anything change in the behavior of your competitors and talk about your opportunities to gain additional market share?

No. The -- well, we -- I, honestly, haven't spent much time looking at the competitors. I think, as I said, I think we keep focusing on the core drivers of what makes us gain market share. And if you look around the world, we have tailwinds and headwinds and the company adjusts very, very fast to those. We had the 1% tax on the cash remittances. So that was a bit of a tailwind in the U.S.

We have new licenses. Then you've got the puts and takes of immigration trends all over the world, generally favorable to the business. And so I'd say that not so like -- we -- if you look at what I spent the last hour doing this morning is I look at every corridor, I look at the metrics, I look how sharp our pricing is. I look how good -- the amount of defects, how many calls. And so basically, if you just keep iterating on what we do well, I think naturally, market shares begin to move. We live in a world where you and I are one click away from an alternative in pretty much everything in our life. And so it's not different for moving money. So you just got to be the best.

All right. Now, Sebastian, you joined earlier this year. You have a history and a passion of using technology to become more efficient. Just talk about some of the tangible opportunities that you see to leverage AI and technology at Remitly.

So AI has -- I've said that it has 3 buckets that we can affect. Obviously, the first one is the cost bucket. I think there's not a CEO in the world who's not getting some benefits from AI as cost. And that space -- that's -- I've seen it every day. I mean, I don't think a week goes by without some kind of wow moment as you're watching a team build something, you start to push and ask questions and somebody in the back of the room lifts the hand and says, "I can do this at half the price with half the people and triple the speed using AI." And this is -- as you march down pretty much all the functions of the company, I anticipate that over the next 2 or 3 years, this really is a tailwind, I think, for every business in the world, but we're very AI forward.

The second bucket is the customer feature and service bucket. AI allows you to do things faster, better, but be careful. Not all these chatbots are great. And -- but behind the scenes, you can help people on the phone, you can help people in chat. So there's a general impact of AI, just making the customer experience better and better and faster.

And then the third bucket, the most unknown bucket is how does it affect your top line. So there's no doubt that AI is affecting the bottom line. There's no doubt that generally, we are being able to provide a much better service. And then the unknown yet is how much is it going to affect the top line. And my basic answer to that is if you can build products faster, products generate revenue, if you can build product faster, you generate products faster and then you generate more revenue. We are seeing that. We launched the global card. We launched it in barely 60 days with a very small team. Throughout all my past and all the great companies I've been at, that would have taken 3, 4, 5x the time that it took us. And that's purely an impact of AI.

So we are living proof that you can launch a product faster, you can start to generate revenue faster. So -- and these are early days. I'm sure you're seeing it in your company. Everybody who's on the call is living some version of this. I am somewhat obsessed with what AI can do to make us better. I think that -- I think the company probably feels it. And I think we're going to get a lot of benefits. And I still think it's early days. I mean it was December that you had the first Anthropic kind of the first jump in the Opus release for building products for engineers. Every 3 or 4 months since then, we've had Fable was the latest. Now you're getting another view with Codex and you've got the open source models coming in. I predict that by December this year, we'll probably have 2 or 3 more aha moments. So this is a journey we're all on, and I think that we're very, very plugged into how to use this and learning to be efficient as a result.

In addition to technology, I think you've made some structural changes to Remitly. Can you just talk a little bit about those and what the potential outcomes are?

The new wave -- firstly, I think that the new -- and driven by AI, AI is going to drive smaller teams with collapsing skill sets. So when you had a designer, you had a software engineer, you had a product manager, those over time are going to collapse into one skill. So, a, the teams get smaller, the skills collapse. So naturally, the hierarchical structures of the past are going to have to evolve. And I've made a huge jump forward and flattened the organization and pushing teams to be smaller. There are some trade-offs, of course. You have to have better coordination. It's a little bit of a messier process, but you move a lot faster, decisions are made faster. The information can flow through all these different tools much faster. So I'm evolving the organization to many small teams moving very fast in a much flatter structure, which I think is going to have an impact on our results and the products that we can deliver over the next few years.

Let's move to the pivot to the numbers. Vikas, can you just remind us of some of the dynamics that we should remember as we look into the back half of this year? The low fraud costs and the difficult comparison in the December quarter?

Yes. I'd say, first of all, we've had an excellent start to the year. The first half has been excellent. Really strong traction in multiple areas as well as maintaining cost discipline. One of the things that we did as Sebastian joined was to take a stock of different initiatives and see where we wanted to invest. We have now firmed up on those initiatives. So we'll be unlocking those investments over the second half. As we look at some of the categories like transaction loss, as you said, we have seen a lot of fantastic benefits from AI as well as the team has done a great job.

Fraud prevention is a top priority. At the same time, we know that it's -- when we are innovating and we open up surface area, whether it is new geographies or new payment types, threat vectors do open up. And so we want to be cautiously optimistic over there. So we continue to maintain the stance we did, which is a 9 to 13 bps of an average where over the next 2 quarters, it will be around 11 bps. But outside of that, we feel really optimistic.

And finally, I'd say that second half of the year is always a setup for the next year and how well we do. So we'll be investing in marketing for growth. We feel that right now, it's the time to gain more market share. And our Skip the Line campaign has been very successful in the first half, and we'll be continuing to double down on that effort as well. So overall, very, very optimistic about the second half. The setup is really good. We have 10 million-plus quarterly active users, which creates a nice durable revenue growth as well as cost discipline helps us have strong EBITDA margins and, finally, investing for future growth.

And about investments, managing investments and margin expansion, you have that Rule of 40 framework, which is defined by revenue growth plus EBITDA margin. And historically, you've talked about EBITDA margin, contribution margins of about 30%. It's been much higher than that level over the last couple of quarters. Just talk about those different dynamics and maybe the flexibility of giving you more opportunity to invest? And are we at a new level in terms of margins contribution.

The Rule of 40 framework has been very helpful for us in our capital allocation. And our capital allocation is simple, drive durable growth, drive profitable growth and, finally, invest to build the future. And if you look at all the 3, we are hyper focused on each of them. First one, our growth rates have been excellent, and we continue to diversify that growth as well.

Secondly, the EBITDA margins with the cost discipline with AI and just a very disciplined framework where we only invest when we see a long-term profitability is -- has been a differentiator.

And finally, our investment framework is something that we keep sharpening every quarter. And now with Sebastian at the helm, there's a very focused process around goal setting and initiatives review. So overall, feel great about the Rule of 40 framework. The goals that we set at Investor Day, we have been marching along quite well. And overall, we feel really, really positive in terms of our key initiatives.

And Sebastian, just along that same line, you mentioned more products is a focus for you. Can you just remind us of kind of how long does it generally take before you get comfortable to make that decision, either to reinvest in the business or to potentially pivot into something new?

Yes, it's a good question. There's a bit of an art and a science to this. Obviously, you want to -- especially -- let me take the Remitly Global Card as an example. So we've been testing pieces of that card, the membership, the lending, the short-term liquidity, but we've added a pseudo bank account for everybody. We've added the ability to lower -- we can be very efficient on prices if you're sending card to card, no foreign transaction fees. You can deposit your salary there. So we've made -- we've expanded the value of the card and now it's in the market getting traction.

And for a business like us, we've said in the next 2 years, these businesses have to be 10% -- or are going to be 10% of the total. So let's say, in 2 years or 3 years, for $3 billion, 10% is $300 million and we've got some of these in the works. I would unscientifically say we expect if any of these businesses get to $100 million in revenue, I think they're $1 billion opportunities for Remitly, which means we've crossed that chasm. We've gone from the $1 million, $2 million, $5 million growth rates, the high growth rates we're seeing now. When we get to something like $100 million, then you say you've got to double down. This is a $1 billion business. Or some of these products may have a fast start and then plateau. It depends on how the market feels about it, at which point you've got to have to build them also and move and allocate to the next product.

So it's a good question, we should keep asking it. But I'd say, unscientifically, I'm looking to -- for these products, they're all in markets that I know could be billion dollar opportunities for somebody. We have tremendous products in the market. We are a great candidate to make them all, whether it be the business sender, the high-value sender, the receivers and the card. We think they're all billion dollar revenue opportunities. The question is, will they be and how do we decide to double down on them? So far, so good. All the products are going really well. We're very excited. But we've got a big revenue base. And so competing against the core business is the tall order.

Speaking of, let's pivot to the core remittance business. This is probably 95% of your revenue this year. Now there's multiple growth levers in this business, we think about market share gains, expanding into new geographies, intra-regional transfers. Just talk about the different levels of investment and the time to ramp for each of these levers.

Yes. The -- a couple of -- there's a couple of core pieces that drive the growth. First of all, we have 5,000 corridors around the world. And we call it corridors when you move -- you can move, say, pound to some currency in Africa, that's a corridor. And even with 5,000 corridors, which is a tremendous coverage and one of the best in the world, we're only 50% -- we're only 50% of the way in covering the whole world. So number one is we have a big -- we have a team that's very focused on continuing to expand the places and the ability to move money anywhere in the world at the speed and cost that you can expect from Remitly.

The second piece, obviously, we do drive customer acquisitions. We've got a very good engine to drive new customers. We've got a marketing machinery that's been proven around the world. We continue to perfect that. AI gives us some tailwinds to keep personalizing by communities. The Chinese community is different than the Indian community, it's different than the Paragon community. And we approach all those communities around the world very, very specifically. And we've got lots of programs to keep driving that growth.

So I'd say that the -- expanding the network and expanding the precision of our marketing to continue to get new customers and repetition from existing customers are probably the 2 most significant drivers that we have to growth in the core business. And then, of course, you can never forget that you've got to be priced right. And so that's -- scale matters in this business. We are a scaled business at this point. We're getting all the benefits of the unit economics and the cost benefits. And that allows us to be very price competitive, which is also a key part of winning in this market.

Now immigration patterns is a big topic. Can you just talk about how these trends either have or have not impacted your business?

It's different all over the world. I mean you obviously -- if you look at the actual legal immigration patterns in the U.S., they are fairly stable over time. I think there's about 1 million green cards that get given every year. So -- and that hasn't changed that much. You have other countries where it's different. I was in Japan a couple of weeks ago. Japan is importing a lot of labor. As you know, they have a population decrease. And so the Japan to Filipino corridor, Japan to China corridor is very active these days. So you've got that immigration.

So I think at all times around the world, there's these puts and takes. For our business, it has not affected us yet, as you see in the numbers. And I think that you and I can agree that over the next 10, 15 years, immigration trends are just going to continue to go up. I mean the world is still moving around and a lot of the West is importing labor, and I think that's going to continue in some form or fashion. So we have not -- despite the noise and the ups and downs depending on the administration, especially in the U.S., we have not seen any impact on -- remember, we only work with a banked customer. So you cannot open a Remitly account unless you have a bank. So that -- obviously, that piece of the immigration has proven to be quite stable over time.

At your Investor Day, you've talked about how Remitly has maybe 10% to 15% market share within your most established markets. Just talk about the key drivers of growth within your most established regions.

Well, that's -- I'll let Vikas answer, but I'll react to your number. That's actually a good or a bad number. When you say 10%, it means that we have 90% to go. When you mean 10%, you say that's a pretty successful market piece of market share. So I put both hats on. I think that we've proven to really understand this customer in some of these markets, the bigger markets that you can -- U.S. to Mexico, U.S. to Philippines, U.S. to India, Great Britain to India. But by the same token, we're 10%. So we've got a long way to go, a lot of opportunity, a lot of customers who have not used Remitly yet. So we view it as a very big opportunity yet. But I'll let Vikas take on some more specifics.

Yes. No, I think it goes back to where Sebastian started that customers care about sharper pricing, the speed as well as experience. And we know that it's a fragmented market. So it's not like a lot of big players over here. And in a fragmented market, continuing to win share is a very important priority for us. We feel offline to online has been a nice secular tailwind through and through of our business. But now especially with the cash remittances, it provides a further catalyst. We believe that, that is not over yet. In the first half, we saw benefits, but we extended our Skip the Line campaign. So we'll continue to push for that.

Beyond that, I would say that as we add more products and create a nice virtuous cycle, even the send/receive loop that we have makes it much stronger. Secondly, as we move more towards giving customers the power to have a wallet to send, spend, save and borrow, it creates further stickiness as well as creates a higher value proposition. So overall, we feel there's a lot more room even in the core sender to continue to grow.

And just to go back to the second quarter trends, we did notice a slowdown in Canada and Rest of the World. Can you provide a little bit more color as to what drove those trends?

Yes, Cris. And before even I jump into that, I'd say that the -- if you look at overall results, our revenue growth was really strong, and we beat the guidance considerably. And this is where the power of revenue diversification comes into play. So let me start with Canada, for example. We have seen more macro headwinds over there, and that's something that the industry has talked about with more constrained immigration policies there. Now clearly, while we see that, we are not sitting on our laurels. We want to continue to win market share. So even in that market, which has been growing slowly, we continue to win market share.

On the Rest of the World, I would say it was more specific to African corridors where the year-over-year comps were tougher. And hence, we saw that. Rest of World continues to be a growth driver for us, and we'll see that over time as well. This is where we can continue to expand markets, as Sebastian shared, as well as increase the send to send, as we call it, between the more higher end, call it, developed economies where Australia, U.K., Europe, I think the transactions within those economies can continue to grow for us. So overall, we're very optimistic about the future. At the same time, revenue diversification is the name of the game, whether it is through corridor, diversification or through the different revenue streams or customer categories.

And speaking of Rest of the World, UAE, I think, has been a big focus of ours. And I think you guys entered that market in 2023. Earlier this year, you opened an office. You got a new license. Can you just talk about the journey and the opportunity within that market?

Yes. Well, we've been focused on the UAE for years, but it's a very important country for us, $50 billion in annual remittances, 90% of that population are migrants. 50% of outbound is digital. So it's a very highly fragmented market. This new license allows us to bring a whole group of new products to market, including our global card. And so we're very excited. I think it's -- I think we have to earn our spot there. We've been there for years. We've got an office there. We're growing the team. So far, so good. I think it's actually a perfect market for Remitly and one that I think we're going to win in.

Let's pivot to stablecoins. It's been a big focus of investors. Just talk about how you're using stablecoins today? What are the benefits? And talk about maybe the rationale for joining the open USD initiative.

Yes. So I'll start with the open USD initiative. I mean it's -- I think the world is still trying to figure out where and how the consumer is going to use stablecoins at scale. And I think that the OUSD consortium was a really good move in the direction to make sure you globalize the stablecoin that you use that many companies come to share it.

And so for a stablecoin, you're going to need trust, you're going to need adoption and you're going to need shared economics. And in our view, OUSD does all 3, which is the companies involved are part of the world's current movement of money. Adoption seems to be a key part of this and all of us that have signed up are going to be obviously adopting this new stablecoin in our products.

And number three, is that we share in the economics of the value that's created from the use of the stablecoin. So it's early days. We haven't launched anything specific with OUSD yet, but we're working on a few products. And so we'll see how that plays out.

On the broader stablecoin use, there's a few use cases for us. Obviously, trying to -- we can use it in our treasury settlements as we can move money 24/7 into some of our destinations. We preposition money across the world to make sure we can deliver it very fast. And there are corridors where if there's enough liquidity, moving to a stablecoin model allows us to do that faster without having to preposition money because we can do it in one second through the stablecoin rails.

There is a consumer use case. It's very small still, and the consumer use case is -- there's a large part of the world who wants to hold that money in dollars, and that is difficult to do in today's fiat model. And stablecoins and stablecoin wallets and stablecoin cards where allowed, allow a mass of the world to be able to hold dollar currencies. That's a use case that we've launched a card in Argentina. We've launched a card in Pakistan. If you're sending money to somebody in Argentina, you can send it to the stablecoin wallet. That person will receive it in a wallet. They can spend, they can keep it in a card, they can spend it. It's small, but I think that it could have -- depending how all the regulatory framework evolves, that could be a use case that's interesting.

And then as far as the actual rails, we're very cost efficient. And any place around the world where we find that stablecoins can improve our costs, it's one more tool in our arsenal, and we will happily be using it. So it's not a one size fits all. It's early days, but we are adopting it where it makes sense and where it makes sense for our customers, too.

Let's -- we have like 10 more minutes. Let's move to the growth accelerators, which, as you said earlier, should represent about 5% of revenue this year with a goal of at least 10% in 2028. Maybe we'll start with high-value senders. I asked the question earlier, but talk about how your tech stack enables high-value senders because our work suggests that not every provider can do that. So just talk about your comfort level and some of the risks to power that business.

Yes. I can start there. Sebastian, you can add. High-value sender is such an important growth driver for us. As you said, Cris, the first reason is that the network already exists. We already have customers who want to send and call it, 12 months back because of partner constraints or otherwise, we were not able to enable. We have worked a lot on the product to enable that. We had our first $300,000 transactions, not one, many. This last quarter, we had one customer send more than $1 million in the most recent quarter. So overall, there's a huge unlock that's happening. And this is where we haven't really even invested in marketing and creating awareness. So we feel the upside here is right in front of us. So overall, we feel very excited about high-value senders, and that will continue to be a growth focus for us.

In addition to marketing, I assume you're going to be adding additional services to help capture that market. On the call, you mentioned adding wire capabilities. Can you just talk about some of the additional services that this market requires?

Yes. And the default for anybody to send high amount of money around the world is usually your bank. But this -- so -- and the reason you use your bank is because you trust it and you've got a long relationship with it and it's easy to move -- that's where you have your money. So we have to compete against a very well-functioning system that's worked for 50, 60, 70 years, whatever the number, maybe hundreds of years really, if you think of how the world has moved money.

And so -- but there is a segment of the population who really -- we were very well price competitive. We move money very fast. That customer needs a white-glove service. They need to be able to really address problems when they happen very fast. And so we're moving into that space. We've launched a white-glove service. You should try us, by the way, if you have to pay somebody around the world a lot of money, use Remitly and you'll see that the app is a little bit different because you've got to focus -- you're optimizing for different things, things like foreign exchange, account wallet fees. If you're sending $100,000, a $2 fee is not that important, but the FX is.

And so we're evolving the product very fast. The signals are very good. People are using us to send money in large amounts. And in some of those corridors where we're very well -- where we have a lot of reach, it's working very well for us. So it's a new segment for us. I mean it's a new revenue stream for us, and we're -- we think it's large, and we're just getting started.

Moving to SMB. There's a lot of companies that are going after that business. Sebastian, you talked about it earlier. Just talk about your right to win. And who are you really focused on going after within the SMB business?

The -- I think it's the small S in SMB is what I primarily focus on. The use cases, I was in the Philippines a month ago, and I sat down with freelancers -- I sat down with salespeople who get paid by U.S. companies to do sales calls. There -- I sat down with people that do -- there was one person who analyzes roof pictures for an insurance company in the U.S. who bids on changing roofs. So you take a picture of the roof and this person runs it through that software. And so you have all these use cases, which kind of match sometimes big companies, so sometimes S -- small S and even the Ms, but mostly to a freelancer type of population around the world. And it really is amazing to -- if you go through all the use cases. And it's a very big market, very -- there's just so many use cases. So it's a very, very fragmented market.

We are going to get very, very good at the small end of small businesses and that freelancer. Those virtuous cycles get built between the connection between the freelancer and the company they're working for and they're using freelancing for a number of companies, so they introduce Remitly to other companies. It's a very global market. We see countries like Pakistan, Mexico, providing lots of different types of business services. So we're early days. It's a very large market. I guess that's the -- it's a very large market, very fragmented. So you have to be good and you have to figure out your go-to-market if we're going to get large in this market. But so far, so good.

And then similar to high-value senders, are there additional services that are required to kind of go after what you want to go after?

Yes. You have to -- it's a different KYC process, know your customer or know your business. It's a more -- there's a bit more friction involved as you sign up as a business. You need features like being able to pay 10 people at the same time versus 1 at a time. You need to be able to plug into the different accounting systems and ERP systems that the small businesses use. So there is a -- we've got a team dedicated to building the product. It's improved dramatically. We're seeing -- we've launched it in the EU also. So we're going to expand globally. So yes, it requires additional features, it requires additional process and it requires a different type of service also.

And last but not least, I think you've kind of unified the strategy around Flex, Wallet, Send Now, Pay Later into the card offering. Can you just talk about kind of the strategy there and what differentiates Remitly relative to some of the other competitors?

Yes. I think we were probably guilty of too many ideas. And so we launched too many products and ended up probably even confusing ourselves. So we've simplified it all under the construct of a card. And the card now provides -- it has the Send Now, Pay Later product, which is a short-term liquidity lending product. We've got a membership product where we offer -- we're launching data plans for people that are traveling. So we include a data plan for your phone and the ability to get liquidity. We've launched different price points when you're sending card to card because for us, we can manage those rails directly.

And so we -- the Remitly Global card, I think, is a milestone product for the company because we have a very long list of new things we can put into our customers. And with this card construct, it's very easy just to insert them into the card. And so the team was telling me yesterday, they want to launch cards for kids, for example. So parent has a card, you can have a -- kids can have a card and he can have pocket money. And I'm not saying we're launching that immediately, but I'm just saying that an idea like that it just completely starts to fit into the card. So we're very excited. We have years of work to make this the most incredible card on the planet for people that move around different countries.

I just saw some questions also. I just want to add some flavor to that. I think this does create a nice use case where there is send, spend, save, borrow, which does create like one of the important goals for us is to have bigger wallet balances that ultimately start creating that revenue diversification and unit economics on this is powerful.

The other point around the borrow, Send Now, Pay Later. We have a phenomenal team behind the scenes. We have seen a very thoughtful management of risk over here. So we'll continue to do that. And that's why the focus is on all the send, spend, save and borrow, and not just like we are moving away from just Send Now, Pay Later. We are moving much more into a card product, and that is the reason for that.

Okay. Great. One last question real quickly on capital allocation. Clearly, share buybacks and internal investment is a key priority. But what's your latest thoughts on M&A?

Yes. So not -- we believe our capital allocation plans as they stand right now are the right ones. We have a share buyback program. We are looking to allocate money to growth since we have the opportunities because this is a -- we're in a very big market. We have a lot of growth opportunities. We want to be very balanced in this capital allocation. So as of right now, no plans. We have -- we're very busy, and we have a long list of our own ideas to keep the growth growing. So no M&A plans as of right now, and we're going to stick with our capital allocation plans as we stand right now.

And then, Cris, one additional thing that happened over the last 6 months is with AI, the bar has risen very high, right? And as Sebastian said, the speed and velocity of innovation internally has gone like really, really fast. So our organic road map is very strong.

Well, unfortunately, we're going to leave it there. I want to thank everyone for joining us today and a special thanks to Vikas and Sebastian. We look forward to continuing the conversation. Have a good afternoon.

Thank you, Cris. That's great. Thank you.

Thank you.

Good day, and thank you for standing by. Welcome to the Remitly Second Quarter 2026 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your first speaker today, David Beckel, Head of Investor Relations. Please go ahead.

Good afternoon, and thank you for joining us for Remitly's Second Quarter 2026 Earnings Call. Joining me on the call today are Sebastian Gunningham, Chief Executive Officer of Remitly; and Vikas Mehta, Chief Financial Officer. Results and additional management commentary are available in the earnings release and presentation slides, which can be found at ir.remitly.com. Please note that this call will be simultaneously webcast on the Investor Relations website.

Before we start, I'd like to remind you that we will be making forward-looking statements within the meaning of the federal securities laws, including, but not limited to, statements regarding Remitly's future financial results and management's expectations and plans. These statements are neither promises nor guarantees and involve risks and uncertainties that may cause actual results to vary materially from those presented here. You should not place undue reliance on any forward-looking statements.

Please refer to the earnings release and SEC filings for more information regarding the risk factors that may affect results. Any forward-looking statements made in this conference call, including responses to your questions, are based on current expectations as of today, and Remitly assumes no obligation to update or revise them, whether as a result of new developments or otherwise, except as required by law.

The following presentation contains non-GAAP financial measures. For a reconciliation of non-GAAP financial measures to the most directly comparable GAAP metric, please see the earnings press release and the appendix to the earnings presentation, which are available on the IR section of our website.

Now I will turn the call over to Sebastian to begin.

Thank you for joining our second quarter earnings call. My first 6 months as CEO have been intense, and they've confirmed something I already knew. Remitly matters deeply to its customers. This quarter's results prove it. Record revenue, record adjusted EBITDA, both above the high end of guidance again. We also achieved an important milestone for the company, over 10 million quarterly active users aided by record new customer additions. That's a direct reflection of the trust and confidence customers place in Remitly and our team's ability to execute.

This quarter's strong results reflect 3 enduring attributes of our business. First, a strategy that works, providing affordable, fast and trusted money movement for a wide range of global customers. Second, a competitive position that is strong and defensible. We continue to gain share and the advantages of lower cost, network breadth and operating scales are compounding. And third, a cost discipline that is structural. The operating leverage in this business is real, and AI is driving genuine productivity gains, which can be redeployed to invest in growth, strengthening our confidence in the top line while we continue to expand adjusted EBITDA margins.

Today, I will provide an update on my operating philosophy, discuss our progress across our core business and growth accelerators and explain how AI has been shaping the economics of our business model and share our latest view on capital allocation. When I joined, I was clear about how I wanted this organization to work. Smaller teams, clearer ownership, customer-first design, AI embedded everywhere, speed as the default. This quarter, we kept building towards that. The result is a flatter, faster-moving company.

Product teams are being consolidated into fewer locations to take advantage of faster speeds to design build and launch features. Fewer layers mean [ fairer ] ownership and faster decisions. Faster decisions mean more products and more products mean more revenue. And through this rapid evolution, our culture has held. Our team continues to obsess over building the most affordable, fastest and most trusted way to move money. They understand every transaction matters to a real family, and I'm proud to confirm what I see every day. Everybody at Remitly cares deeply about our customer-focused mission.

Moving on to an update on our business. Last quarter, I introduced a framework for how we think about our opportunities. Core senders, high-value senders, business senders and receivers against 4 offerings, which are send, borrow, spend and save. Everything outside our core send, we call growth accelerators. This quarter, we shipped against all these boxes. As we broaden our offerings beyond remittances, we build a powerful flywheel, driving better loyalty, higher volumes and more diversified revenue. This quarter's results are evidence that the flywheel is turning.

I'll now cover key customer and product updates across core send and our growth accelerators. Our global pay-in and payout network is our strongest competitive advantage. This quarter, we expanded our network on the dimensions customers care about most, reach, speed and reliability. We added 5 countries, New Zealand, Niger, Mali, Angola and Botswana, bringing the total received geographies to 179. 32 of these countries are now send and receive enabled.

Speed and reliability matter to our customers and are important drivers of retention. This quarter, new real-time pay-in rails, FedNow and Real-Time Payments in the U.S. improved our pay-in funding speeds. And in the second quarter, nearly 70% of Remitly's global funded transfers were delivered in under 20 seconds, an all-time high. Further, payments and customer onboarding improvements drove record pay-in acceptance and record low defect rates, reinforcing the basics that drive customer trust in the Remitly platform.

Last month, we announced our participation in Open USD, a stablecoin consortium as a founding member. This new stablecoin has the potential to cut pay and settlement times by up to 1 day and lets us share in stablecoin wallet economics. Since our last earnings call, we strengthened our regulatory foundation across 3 important geographies. We received the stored value facilities license from the Central Bank in the UAE, an electronic money institution license in the U.K. and an extension of our EU payments institution license. These licenses open the door to new products designed specifically for customers in these regions.

Each of our growth accelerator gained important traction this quarter. Our approach to investing in growth is deliberate. We start small and scale only when we see product market fit and a clear return. Vikas will cover the financials. I will cover the operating highlights. High-value senders are those who send $5,000 or more in a single transaction, often for property investments or larger transfers to family. For them, reliability matters most and the economics of earning their loyalties are strong. In Q2, we lowered friction across a number of dimensions for these customers and added bank wires as a funding option. And in Latin America, a key growth region for this customer category, we raised send limits and eliminated unnecessary customer actions. As a result, high-value send volume more than doubled in the U.S.-Mexico corridor.

Remitly business grew strongly again this quarter with sequential revenue and volume growth both accelerating quarter-over-quarter. New features like bulk send and the addition of 23 new countries in the European Union are helping broaden our customer base. More than 80% of customers added to the business platform this quarter are new to Remitly and usage is sticky with the average business customer sending money 10 times a quarter. This quarter, we grew the receiver product from 6 to 130 countries. It's still early, but we're optimistic about its potential to drive send revenue and eventually spend and save. The bet with receivers is simple: build direct relationships with receivers and senders will follow. In countries where stable currencies and dependable financial services are scarce, we think we can serve receivers better than anyone.

We recently launched a global stablecoin wallet [ and with ] debit card, starting our rollout in Latin America, a first-of-its-kind offering, letting receivers get paid, hold and spend in USDC. Longer term, we want to be a big part of our receivers' financial lives, not just where one transaction lands. This is the first step.

Last week, we launched the Remitly Global Card, an all-in-one product for our customers to borrow, to spend and to save as easily as they can send money home. The Remitly Global Card is the next step in our journey from a remittance company to a broader suite of products our customers need and want. The Remitly Global Card combines one-of-a-kind features, including our best remittances prices, faster and lower fee sends, no fee everyday spending, a bank account for everyone, the ability to hold and move money in fiat currency or USDC, instant transfers between Remitly Global cardholders, no foreign transaction fees, direct deposit, global ATM access and a line of credit to the Remitly Global Card membership plan, among other valuable new features for our global customers.

The launch of this card marks an important milestone for our company. For millions of people, banking wasn't built for them. This card is. With the Remitly Global Card, we are giving communities who live across borders, frictionless access to borrowing, spending, saving and sending. No paperwork, no bank branch, no waiting. All card members get default access to the lowest cost, fastest remittance options on Remitly. Our customers shouldn't have to shop for the best rate every time they send money home. The Remitly Global card allows us to more fully address the financial needs of tens of millions of customers who have sent or received money via Remitly. And our intent is to put the Remitly Global card in the hands of each and every Remitly customer over time. In the coming quarters, we plan to expand the Remitly Global card to additional countries, enabling seamless direct payouts for global workers and broader multicurrency holding capabilities for consumers and businesses worldwide.

Finally, an update on AI. There are 3 ways AI benefits Remitly: speed, trust, cost. Speed, we build and ship faster; trust, we deliver a better, more personal experience and cost, we run leaner. This quarter, all 3 move forward. Speed and trust gains are starting to show up in the top line through faster launches and a better customer experience. Cost remains the clearest AI win so far. AI-driven productivity has allowed us to hold headcount below plan as I reoriented the company towards speed and tested our growth bets. I ask every team the same question. Show me the number that proves your function is more self-driving than it was 1 quarter ago. The answers are getting better.

Before I hand the call to Vikas, I want to say a word on capital allocation. This quarter, we generated $130 million in free cash flow. Today, this management team is balancing 2 things: reinvesting in profitable growth and executing share buybacks within the limits set by our Board. We believe this is the right plan, and we'll continue to update our shareholders as our thinking evolves.

Let me close with this. We delivered an excellent quarter. We're gaining ground with customers in geographies that matter. We're doing it more efficiently than ever. Our products are working for customers. I'm optimistic, not because of our forecast, but because of what I see in the business every day. Thank you.

Thank you, Sebastian, and good afternoon, everyone. We delivered another excellent quarter of profitable growth and strong free cash flow, reflecting solid execution and a rigorous attention to cost discipline. Second quarter revenue was $495 million, $11 million above the midpoint of our guidance and up 20% year-over-year. Adjusted EBITDA was $115 million, $28 million above the midpoint of our guidance at 23% margin.

Let me share an overview of our second quarter results and then provide our outlook for the third quarter of 2026 and our updated guidance for the full year. Strong top line results this quarter reflected momentum in core send and the continued scaling of our growth accelerators. Revenue outperformance this quarter was driven by a number of factors. Regulatory changes in the United States continued to support a shift towards digital remittances, driving another quarter of record new customers acquired. And Mother's Day weekend volumes strongly exceeded expectations. As noted last quarter, the pacing of Q2 growth relative to Q1 was due to a shift in the timing of Ramadan and Easter to earlier in the year.

Unpacking revenue growth drivers for Q2, send volume grew 27% to $23.5 billion. Send volume per active customer reached a record $2,300, up 6% year-over-year, driven by growth in high-value senders and business customers as well as higher average transaction sizes among core senders. Quarterly active customers grew 20% year-over-year to 10.2 million. This was our first quarter above 10 million QAUs, an important milestone, which validates the strength and durability of our business model. Quarterly active customer growth remained strong due to effectiveness of our Skip the Line campaign, which targets customers seeking alternatives to cash-based remittance methods. Our take rate this quarter was 2.11%.

Now let me dive deeper into our revenue performance from a geographic and new product perspective. From a send perspective, U.S. revenue grew 24%, reflecting continued share gains in key geographies. Rest of the world revenue grew 18% year-over-year. On the receive side, revenue from transactions to regions outside of India, the Philippines and Mexico once again grew faster than overall revenue growth and comprised over half of our revenue mix.

I will now discuss the performance of our growth accelerators. As a reminder, growth accelerators include all customer categories and offerings outside of core send. Our growth accelerators continue to gain traction and scale and are well on track to comprise around 5% of total revenue in 2026 and exceed 10% of total revenue by 2028.

Let me take a few minutes to provide more detail on the performance of each of our primary growth accelerators. Let me start with high-value senders. High-value sender volume grew 37% year-over-year, a 70 basis point increase in mix year-over-year. We achieved a number of milestones with high-value senders this quarter, including our first transaction of $300,000 and our first customer to spend more than $1 million in a single quarter. This quarter, we also expanded our customers can fund transfers by adding bank wires. Customers can now wire funds directly to Remitly, which we then deliver instantly through our global network, avoiding the cost and delays of traditional international wire. This gives more customers, particularly high-value senders, a flexible way to fund transactions and is already resonating. Customers using wires send nearly 3x more per transaction.

This quarter, high-value sender volume growth was softer in June due to fluctuations in the Indian rupee relative to primary send currencies as well as short-term foreign currency mobilization measures announced by the Reserve Bank of India. We expect [ sends ] affecting Indian corridors to normalize over the course of the year. Further, we have a robust pipeline of high-value [ standard ] product enhancements. And in the second half of the year, we are expanding our marketing and targeting efforts for this important customer category.

Now moving on to Remitly Business. Remitly business performance continues to exceed our expectations. We ended Q2 with over 25,000 Remitly business users and saw a sequential acceleration in quarter-over-quarter growth for both volume and revenue. Growth was supported by the continued reduction in friction associated with onboarding and transaction flows.

Shifting to receivers. Our receiver offering generated revenue for the first time this quarter, an important inflection point for this business. The receiver product allows us to unlock a direct relationship with more than 30 million receivers on our platform, creating a new flywheel at little to no marketing cost.

Finally, our fourth growth accelerator, spend, save and borrow. We are excited to share an important milestone, the launch of the Remitly Global Card. With this offering, card members can send, spend, save and get paid money from the same account. The Remitly Global Card is an important strategic offering and enabler of revenue diversification as we extend the value of the Remitly platform further into our customers' financial lives. The Remitly Global Card comes with no monthly fees or minimums. Customers can further upgrade to our membership plan, which for $9.99 per month contains valuable benefits, including access to an open-end line of credit that customers can use to remit money home before payday and pay back over time. We plan to evolve our liquidity offerings, which more than doubled year-over-year to a card-focused format over time. The newer card plan format is showing strong early customer uptake with response and conversion rates exceeding prior benchmarks. Lines of credit associated with the Remitly Global Card are funded by a third-party bank partner. As a result, we expect receivables associated with our liquidity products to reduce over time.

Turning to our focus on driving profitable growth on Slide 13. This quarter, we are replacing the term revenue less transaction expense, an abbreviation RLTE, with transaction margin, which we believe is a more intuitive description of this metric. Transaction margin is calculated in the same manner as the measure we previously referred to as revenue less transaction expense in prior periods.

Transaction margin dollars grew 25% to $334 million, outpacing revenue growth. Transaction margin dollar growth reflects strong customer activity as well as improved partner economics, [ routing ] optimization and economies of scale. Transaction margins were 67%, improving 235 basis points year-over-year. Transaction expenses this quarter were $161 million and as a percentage of revenue were 33%. Excluding provisions for transaction losses, other transaction expenses were $137 million, improving 51 basis points year-over-year as a percentage of revenue. This reflects improved network economics as well as continued shift in mix towards digital receive volume. We continue to see early benefits from the use of stablecoins in our treasury settlement operations, but the impact remains modest in absolute terms.

Provision for transaction losses was $24.5 million or 10.4 basis points as a percentage of [ spend ] volume. This was better than expected as we continue to benefit from efficiencies afforded by the AI-driven fraud prevention and detection model deployed late last year.

With that, let me walk you through the specific non-GAAP expense categories. Marketing investments remain disciplined and growth focused. We spent $96.5 million on marketing in Q2, up 20.9% year-over-year. As a percentage of revenue, marketing expense was 19.5%, roughly in line with prior year levels. Marketing spend per active customer was $9.46, up 0.9% year-over-year and in line with our expectations. Marketing consists primarily of advertising and promotions. This quarter's notable brand campaigns included the expansion of our Skip the Line campaign to new U.S. cities, a World Cup promotion featuring Cristo Fernández of Ted Lasso fame and additional marketing investment in the UAE. Promotions, including those in contra revenues grew 35% year-over-year, reflecting a deliberate focus on driving higher retention and win back among our back book of customers.

Our LTV to CAC ratio was about 6x, while our payback period remained under 12 months. Continued efficiencies reflect growth in customer acquisition through unpaid channels and word of mouth. As a reminder, our marketing investments drive returns for many years beyond initial investments due to our growing base of repeat users. Customer support and operations expense was $26.2 million and as a percentage of revenue was 5.3%, improving 68 basis points year-over-year and continuing a multiyear trend of steady operating leverage.

Technology and development expense was $55.5 million and as a percentage of revenue was 11.2%, improving 175 basis points year-over-year and reflecting the benefits of embedding Agentic AI into our engineering and product teams. Despite a modest increase in AI-related spend, the benefits of AI-related labor productivity have outweighed the direct AI spend, a trend we expect will continue. G&A expense was $41 million, declining 11% year-over-year, our first year-over-year decline in G&A ever as a public company. We delivered significant leverage this quarter, 295 basis points as a percentage of revenue year-over-year, reflecting lower-than-expected hiring as we evaluate business priorities, along with a continued rigorous focus on operating discipline.

Strong revenue growth, combined with operating leverage and cost discipline led to a record level of adjusted EBITDA of $115 million. Adjusted EBITDA outperformance was driven by higher-than-expected revenue, lower-than-expected transaction losses and lower-than-expected expenses due to the ongoing assessment of business initiatives following Sebastian's arrival.

Net income was $206 million, which included $140.6 million release of tax valuation allowance. Our North Star is growth in free cash flow while managing dilution, and Q2 demonstrated continued progress on both counts. Free cash flow nearly tripled year-over-year to over $130 million. This was aided by strong operating leverage, favorable working capital as well as lower property and equipment spending as we [ lap ] the build-out of our new headquarters from last year.

Outstanding shares were $212 million, up 3% year-over-year, reflecting our disciplined approach to dilution management and share repurchase activity. Stock-based compensation was lower year-over-year for a second consecutive quarter. It declined 9% year-over-year, coming in at 7% of revenue, which is 228 basis points lower than the second quarter of 2025 due in part to lower-than-planned hiring. For all of 2026, we continue to expect stock-based compensation to increase modestly in absolute terms year-over-year, but decrease as a percentage of revenue.

We continued repurchasing shares in Q2, opportunistically buying back $21 million worth of stock or over 1.1 million shares. Year-to-date, we have repurchased almost 4 million shares. This reflects conviction in our long-term growth opportunities and a view that share repurchases are an attractive use of capital. We'll continue to be disciplined and opportunistic in how we deploy capital towards buybacks.

With that, I will move to our outlook. For the third quarter of 2026, we expect revenue of $505 million to $507 million or 20% to 21% growth. We continue to see strong momentum in our core, and we expect the continued shift toward digital remittances, growth in new geographies and the scaling of our growth accelerators to contribute to total company revenue growth of over 20% in the second half of the year, an increase relative to prior expectations.

Breaking down our revenue growth, in Q3, we anticipate send volume growth to exceed revenue growth and revenue growth to modestly exceed quarterly active customer growth. Send volume per active customer is expected to grow in the mid- to high single digit range, supported by the continued shift in mix towards high-value senders and businesses. For the full year, we expect revenue between $1.978 billion and $1.988 billion, a growth rate of 21% to 22%, reflecting strong demand in our core and growing levels of contributions from our growth accelerators. As a reminder, we are lapping a particularly strong holiday season in Q4, which drove outsized volume growth in the prior year.

Now let us pivot to profitability and expense guidance. Starting with transaction margins. We expect Q3 transaction margins to be slightly higher than the prior year. Note, transaction loss rate may fluctuate quarter-to-quarter. We remain disciplined about optimizing customer lifetime value while rigorously managing risk across our platform. For the full year, we continue to expect transaction margins to be broadly in line with the 2025 numbers on a normalized basis.

Shifting to marketing. We expect continued marketing efficiencies in the back half of 2026 as we prioritize high ROI marketing opportunities. For Q3, we expect marketing spend for QAU to be slightly higher year-over-year as we expand our Skip the Line campaign and increased brand marketing in the UAE. Please note, marketing expense for QAU faces a tough comparison in Q4 as last year benefited from a focused and intentional approach to holiday period spend. Putting this all together, we expect Q3 adjusted EBITDA to be between $92 million and $94 million, translating to an adjusted EBITDA margin around 18% to 19%, an expansion of over 350 basis points year-over-year. For the full year, we expect adjusted EBITDA to be between $410 million and $415 million, representing an adjusted EBITDA margin of around 21% and expansion of over 400 basis points year-over-year. This improved adjusted EBITDA outlook reflects a more favorable outlook for revenue, Sebastian's deliberate assessment of the business in the first half of the year and our commitment to continued cost discipline, leveraging AI as we invest in growth.

As always, we remain rigorously focused on balancing growth and profitability and we'll continue to look to further leverage the benefits of AI as we invest in top line growth. Our outlook also assumes normal levels of transaction losses for the remainder of the year. To summarize, in Q2, we delivered another excellent quarter with results that were strong across our key financial metrics. We achieved over 20% revenue growth and over 23% adjusted EBITDA margins. We delivered record GAAP profitability and record free cash flow, underscoring the power and scalability of our business model.

With that, Sebastian and I will open up the call for your questions.

[Operator Instructions] Our first question comes from Tien-Tsin Huang with JPMorgan.

Nice results here. Sebastian, I thought, given your prepared remarks kind of triggered me to think of asking you about what you're excited about the most amongst some of the things you talked about and where you're leaning in more? We heard about Global Card, USDC, AI. It sounds like business also outperformed. What's changed in the last 90 days in terms of your excitement and where you're leaning in more?

Good question. Thank you. I think I'd say the sum of the parts, I think we are hitting on many cylinders right now. I think the sum of the parts look really good to us. We're a very diversified business globally. As I've said before, you get these puts and takes on different corridors. I really like the rhythm that we're gaining on upgrading the products, the new launches. So it's hard for me to pick one specific piece, Tien-Tsin. But I would say that today, standing here today, I'm very pleased with the momentum on many pieces of the business. Of course, as you look under the cover, as you look under the hood of the business, there are many pieces that make up the delivery of this money movement, whether it be on the network side, on the risk side, on the compliance side, there's just a lot of good momentum across the company. So you force me to pick one piece, I'm avoiding your question and saying, I think it's the sum of everything right now.

Our next question comes from Ramsey El-Assal with Cantor Fitzgerald.

Vikas, you mentioned that you'll be expanding your marketing efforts for the high-value senders in the second half. Can you think -- help us think through kind of the cadence and the magnitude of that investment? Is it kind of a gradual ramp through the balance of the year, a more meaningful step-up in marketing spend later in the year? How should we think about that from a modeling perspective?

So overall, I would say that we remain very confident in our high-value sender business and the long-term growth potential of that business. As we have shared in the prior few quarters, we are just getting started there, raising the send limits, making product enhancements. In fact, this quarter, you saw some very interesting highlights. We had our first set of $300,000-plus transfers. That's a pretty big milestone compared to where we were 12 months back. And within the same construct, one of our customers sent more than $1 million in the recent quarter. And that just tells that the demand is there. Our network is set up for that. And it's just a matter of focus and marketing for us. And once we can be more targeted, we can see a lot of benefits here.

We haven't invested a lot in the marketing in the specific high-value sender market. And again, we will be very deliberate. We will be gradual and we'll be thoughtful how we increase the marketing. We'll learn from our early marketing campaigns before we expand more in FY '27. But overall, I'd say disciplined, but at the same time, focused and thoughtful marketing in the [ HVAC ].

Our next question comes from Cris Kennedy with William Blair.

I think productivity gains from AI is a key theme from the call and incremental EBITDA margins were over 60% in the quarter. I think that's nearly double kind of what you've historically talked about. Can you just talk about the levers there and what that means going forward and the opportunities to reinvest back in the business?

Yes. I think we're on this -- I think we're all on this AI journey. And I just reflect that I don't -- a week doesn't go by that you don't get some kind of wow moment on what you can do inside the company with AI. We -- and it varies across -- obviously, the most obvious ones are some of the -- the fact that you can constrain some of your people growth but speed is money, productivity is money, simplifying the organization is money also. So it slowly compounds. And as you get -- we track almost every piece of our AI usage down to the individuals, down to the production of code and the use across the company, and we're launching all different agents that do different tasks within the company. So this is a snapshot in time. You're seeing the benefits. Your question is, is this going to accelerate over time? It's hard to say. I certainly don't see it decelerating. And I think that we can look over the next few years, and we're just going to keep learning how this is going to change our company, how it changes the management. So it is a theme. We live it every day. And I think I'm optimistic about the future trajectory and the efficiencies that we can get with AI within Remitly.

Yes. And if I were to add on the expense categories, if you look at -- Cris, if you look at all the expense categories, we got benefits across the board, whether you think about transaction loss and the AI/ML capabilities that we are building, that has definitely -- we have seen that over the last couple of quarters. If you go further into customer support, that's a key area of benefit that we have been harvesting. This quarter, specifically, the 2 standouts were the technology and development spend, which just grew in mid-single digits, thanks to the net AI benefits that we were getting in spite of a modest increase in the AI spend. And finally, G&A, that was the biggest one of the first year-over-year decline as we are able to harness that benefit across all our support functions, whether it's legal, HR, finance and the platform. So AI net benefit for us has been a positive, clearly early days, and we will be very mindful and thoughtful here.

Our next question comes from Alex Markgraff with KBCM.

I wanted to ask about the receiver side monetization. It's obviously a compelling opportunity. I was hoping maybe just to discuss the sort of right to earn wallet share with these folks, the receivers. I'm curious what the sort of wedge or value proposition that's distinct from local or other global peers would be that you'd point to with Remitly card and other offerings.

It's very -- so thank you for the question. It's very early days. Your question is what earns us the right to offer services to this receiver. It's a very unique transaction when somebody in some part of the world receives money from sender in Remitly. And so at that point, in all the mechanisms, we know the money, we know the receiver. And so there are many things that we could do to encourage that receiver to either spend the money, we can put the money in USDC. We can put it in cards. We can keep it in accounts. We can offer savings products. So the theory of it is very compelling. And we have, as we've said, about somewhere in the order of 30 million or 40 million receivers around the world. We have not proven that yet. We have a team rapidly iterating. We see some really good signals.

We've launched a bunch of products. And then I'd also remind you that I think some large portion of our transactions are pair-to-pair transactions, which is they repeat often. So every month, sender A sends to receiver B and those 2, that pair is connected many times during the year. So you could imagine all kinds of products that we could offer to that pair. So early days, we feel it's one of the investments that we're making. We feel there's an opportunity here. We have not proven it. So we'll keep you updated on how that advances.

Our next question comes from David Scharf with Citizens Capital Markets.

You know what, the results are so strong, I guess I'll ask a devil's advocate question just to kind of mix things up a little. And it relates to the growth accelerators. Did I hear correctly, and I think it's dated from the Investor Day, maybe it's unchanged, did I hear Vikas say the expectation is 10% of revenue by 2028?

That's correct, more than 10%.

Okay, more than 10%. I guess the devil's advocate question is, why isn't that larger? I mean it seems like these are tremendous opportunities, particularly on the business side. Obviously, you spend a lot of focus in these presentations highlighting these 4 distinct categories or silos. Can you -- I'm just trying to get a sense if 10% is a reflection of, a, conservatism; b, just the core C2C business is so strong secularly that, by definition, kind of weighs down that mix. Am I kind of incorrect thinking that, that's a number that 2 years from now is actually going to end up being higher?

David, first of all, thank you for your optimism. We share that optimism. And what I'd say is that we want to be very thoughtful with the new products to get the product market fit right. We want to test them out in a way that they are really battle tested. And then once we have that validation, [indiscernible] core marketing and really drive the acceleration. And rather than putting a very tight time frame to it, we look at the bigger price than the total addressable market. And if you look at all our bets, they are huge and massive. If you take Remitly business, that is bigger than our core consumer business. If you look at high-value senders, the network remains the same and the upside is massive.

If you look at Remitly Global Card and receivers, everything Sebastian said that there are so many use cases that they could really unlock and create a massive potential. And I'd say these are 5-year, 10-year bets that could really diversify our business, make it a multi-revenue stream business. And our objective right now is to invest in them in a way that we make them long-term successful rather than trying to get some short or medium-term wins. But at the same time, we feel really confident to get to the 10% plus threshold. We'll keep updating you. But overall, we feel the focus is really on the long term.

Yes. I think well said, I would -- I mean, if you take -- we've given this time frame of 2028, but let's take the time frame. I think we'd probably be disappointed over a longer time frame if they weren't much bigger businesses. All the bets we're making are in very large markets. And so the fact that we're still in the bets and growing and excited about it means that we're not going for a 10% -- what's 10% of what are we, $2 billion revenue, 10%. So, we're going for much bigger opportunities here. So I think it's a fair question. We will obviously keep updating you. We -- all the signals we see, we will kill any business that doesn't be on a trajectory to get really large. We have plenty of opportunities and plenty of businesses. We have a lot on our plate right now. So we'll just keep you posted on -- we're going to stick to the response that Vikas gave for now, but we're working hard to make it a lot bigger.

Our next question comes from Gus Gala with MCH.

So I think an interesting topic to get into would be you're seeing some, let's say, changes in pricing actions, maybe a little bit of distress from larger legacy peers in North America. I mean, that's really the core business. Is there -- can you talk about the opportunity there in terms of the lower cap rate? It sounds like pricing being taken back maybe not lead to think that digital marketing competition is coming down a little bit. And then if we think about the second half of '26, just on the margin, just I'll squeeze in my question, 19% margin versus a 23% this quarter, plus 50% in the first half, you're guiding to a 23% incremental in the back half. I get the incremental investment in HBS, but that -- our math is kind of low double digit of total volume. And you're assuming consistent transaction loss rate, anywhere else in OpEx we should be thinking about [ or ] investment?

Thank you for your question. I'd say that if you -- I'll answer your second part of the question first and then move to the first and Sebastian can add more to that first part as well. If you think about the EBITDA margin guidance, it's something that we have put a lot of thought into it. And even as you see that and if you look at the year-over-year increment, it is 350 bps just in Q3. And if you take the FY '26 guide, it's a 4 percentage point increase year-over-year. So clearly, we are making a lot of progress when it comes to expanding EBITDA margins. If you see the first half of the year, I'd say there has been some, call it, specifics over there.

First of all, Sebastian joined us in that first quarter and has been evaluating the business initiatives in a rigorous way, and that created a little bit of a pause as we decided which ones we want to go and invest deeper into. In addition to that, revenue outperformance as well as the lower transaction loss that we have seen, which we -- in our assumptions going in the out quarters, we are normalizing that to 11 bps. But that creates some, call it, added first half benefit for us, which especially in the transaction loss we are normalizing for second half. Outside of that, we feel there are opportunities in marketing investments that, again, we will be evaluating on a very specific basis. But that goes to your first part of the question.

We see massive opportunity for market share gains. We saw that in the first half with the remittance tax, and we leveraged our Skip the Line campaign. And we did that in the first quarter, but we saw remarkable benefits, and we decided to extend that in the second quarter, and we shared that with you last quarter. And we are further taking it forward in the second half of the year. So we share the same thoughts where we feel the opportunity to grab share is there, and we are going to be front-footed as we look at the second half and FY '27.

Yes. And we intend to be very aggressive in pursuing this market share. The opportunity is there. There's no -- from a customer perspective, there's no magic here. The customer wants sharper pricing, wants to move money faster and wants a better service, and we're very focused on all 3. We're iterating on 3. Our pricing is getting sharper. We are moving money faster and our service is getting better every day. So the result of that is just going to be continued market share gains. And this happens across the world. We have many corridors where we already have a very good market share, but we see opportunity in the larger corridors, in the smaller corridors. And I think that this is a good moment for us to be quite aggressive in pursuing that market.

I'm showing no further questions at this time. Thank you for your participation in today's conference. This concludes the program. You may now disconnect.

Let's get started. So good afternoon. My name is Aditya Buddhavarapu. I cover Remitly here at Bank of America. Very excited to be hosting Remitly at our 6-week earnings conference for the first time, and pleased to have CFO, Vikas Mehta.

Vikas, thank you for joining and taking the time.

Thank you, Aditya.

So look, let's get straight into it. Do you want to maybe start off with giving us sort of intro to the Remitly story, talk about the origin and then how you got here and I guess a few points about the evolution on that journey?

Yes. As I said, thank you for the invitation Aditya, and great to be here. Remitly is an exciting story. We will be almost 15-year old. And in that journey, I'd say there have been 2 chapters that are really prominent and we are about to essentially started our third chapter now. And the first chapter was started, we started with U.S. as our focus from a send perspective. Our first few receiving countries were Mexico, India and the Philippines. We really honed our business to that initial foray and then expand it further.

In 2021, when we had our IPO, we had 1,400 corridors, and again, very U.S.-centric at that point. Then we started with the second chapter. And the second chapter was about a few things. One was about global expansion. So from 2021 through 2025, we expanded to more than 5,600 corridors right now.

We also really got scale economics working for us. This is where we started generating strong positive EBITDA margins and have especially expanded our margins over the last couple of years in very sharp way. And the final thing in that chapter was about making sure that the unit economics and the business model were very accretive to us. So with U.S. expansion, strong growth in the Chapter 1 with international expansion, proving the business model, expanding margins in Chapter 2. We started the Chapter 3 right now, which is about diversification. This also marks a new CEO for us with Sebastian Gunningham, who is leading that chapter for us.

As we started that chapter, we -- in the most recent quarter, we did more than $100 million in EBITDA. That was our first $100 million EBITDA quarter. We also had strong growth of 25% revenue, 37% volume growth. So the growth story continues for us, and we see that as an exciting trend. And now as we diversify into newer customer categories as well as use cases for customers, we feel that the Remitly story continues to come and have a very positive and exciting future ahead.

Great. So you've clearly come a long way. If you take a step back, volumes have increased tenfold since 2019 or I think last year, you were about $75 billion of spend volumes, but that still represents only about 4% of your sort of addressable consumer remittance market. So how should we think about the sort of the next 5, 10 years? What are the key growth drivers? Maybe you can expand on some of the opportunities you talked about at the CMD last year in December as well. And also maybe how Sebastian coming on board as the CEO has maybe some of that or brought some new ideas there.

Yes. I would put our growth drivers in 2 categories. The first is existing core business, which you pointed out, we have less than 5% market share in that. And then the revenue diversification, which I talked about, which essentially we have a 0% market share there. Let me start with the first one. And if you think -- if you dissect the core sender market, let's say, and think about the key drivers and catalysts for growth for us. It starts, first of all, with market share gains.

To your point, less than 5% market share. The market is fragmented. We are now a scale player, one of the only few ones who have north of $1 billion in revenue, as you said, reaching $100 billion in volumes, still growing north of 30%, 35%. So that creates a nice virtuous flywheel for us, which will continue to accrue to help us win share. Within that, if you think about the core trends of the shift from traditional brick-and-mortar to digital, that is ongoing. It accelerated during COVID. It further accelerated recently with the remittance tax in the U.S.

We feel that there is still room ahead on that conversion of traditional to digital and we'll continue to benefit from that. In addition to that, I'd say the other important aspect is global expansion. There's a lot of room for us to continue to expand. As I said, we have 5,600 corridors. If you look at others, they talk about 20,000 corridors. And so we have a lot of room there. We shared at our Investor Day that out of the top 50 send corridors, we only have about 50% of those.

So again, from even the sizing of that geographic expansion, I'd say that there's substantial room for us to continue to expand. On the other hand, if you see the diversification story, a lot of these are adjacencies, whether it is high-value senders or Remitly Business or receivers. These are markets that came to us. These are customers who were using us for different purposes and came to us and said, "Can you help us get these features, which would make it easier for us." So we feel the product market fit is very strong. And what we need to do is drive a deeper focused efforts on those aspects.

So if you feel very excited, if you take Remitly Business, for example, that's 10x the TAM of the consumer side, which is $20 trillion. And as I said, we have de minimis share there. So a lot of upside as we think about the next 3, 5, 10 years. And beyond that, moving into Send Now, Pay Later, moving into products which can help our customers save as well as spend will be additional areas, again, which are all adjacencies. We have a strong set of 10 million quarterly active users. And as they adopt these other use cases, even with this captive user base, we'll be able to continue to grow in a very strong way.

Okay. Great. It's clearly lots of areas that you're focusing on and we will dig into those. Before that, do you also want to maybe talk about what enables all of this growth? So the underlying infrastructure you built in terms of partnerships, pay-in, payout methods, applications for consumers. Just maybe talk of all of those elements of the offering, which will underpin that story.

Yes. I think I'd say the strategic differentiation that we have is the infrastructure that we have built. And this infrastructure has a lot of different, call it, layers, if you may. And it begins with a strong technological foundation. When we started in that 15 years back, the approach we took was a very technology-first approach. And this is where we did not -- we never had a brick-and-mortar presence. We always started with web and then quickly moved to a mobile-first approach and embrace that as our foundation.

Even as we look at AI right now, we are, again, leaders in embracing that and making sure that it bolsters our platform, similar for stablecoin. So I'd say technology layer strength is, I'd say, a big differentiation for us. The second highlight I'd give is compliance and regulatory strength. And this is where we -- as a company, we have always thought about compliance as a design component rather than an add-on. So any time we are thinking about a new geography, new licensing, we start with the construct around what's the best compliance angle that we can take here and don't discount that at all.

And as we do that, especially when you run a business at scale, it creates consistency. It creates -- from a customer perspective, also, we feel being compliant helps us to create that strong relationship with the customer where they know they are working with a partner who is committed and who is going to do the right thing. So that would be a very important part of that layer. And the third layer I would talk about is the transaction layer. This is the whole partner ecosystem, if you may. This is how we can get transaction done in less than 20 seconds. This is how we can reduce the transaction defect rate where high 90% of our customers have seen less transactions happening.

This takes a long time to build. I'd say that both on the partner ecosystem, directly working with government rails like UPI and Pix or building stablecoin rails. I think this layer is, I would say, the biggest differentiation for us and optimizing that at scale creates massive economies of scale as well as a structural advantage for us.

Great. So you spoke about some of those products you're looking at, whether that's spend, save. But also we hear it as high-value SME. These are in relatively early stages. Can you maybe just give an update on the rollout, which one is maybe slightly more advanced and which might scale earlier and some maybe a bit later?

I'd say that to your point, all these different initiatives are at different stages. I'd say that, again, we gave this 4x4 framework. So I'll just repeat that a little bit and then share where we are in each of these. From a customer category perspective, we have core senders. We have high-value senders, we have Remitly Business and we have receivers. From a use case perspective, we have send, we have spend, save and borrow. So if you think about customer categories, core, of course, is our bread and butter. But beyond that, high-value senders is the one we have a lot of traction.

This is not something new. Our core experience always provided ability for high-value senders, but we were not as focused on that opportunity. Now as Sebastian comes in as a new leader, he is putting these 4 buckets and creating leadership and accountability for each of these. So that's where we feel high-value senders is already a decent percentage of the volume -- and from a revenue perspective, it's a low single-digit contributor. We believe there's a lot of headroom on that one, and that's something exciting.

Remitly Business, I would say it's the distant second, something that we just started over the last, call it, 18 months. And we've seen a lot of very good initial signals on that. The team is fantastic. They are working backwards from what the customer is looking for, building features at a very fast pace. We've talked about 20,000-plus businesses on the platform at this point. The unit economics are fantastic. So that's, I'd say, the second one. And the receivers is very new. It's very nascent, just, I'd say, months in that versus, call it, peers in the Remitly Business side. But it's very exciting.

If you think about every sender, there is approximately 3 to 4 receivers. So call it, our 10 million quarterly active users, you're talking about 30 million to 40 million receivers. So all of a sudden, that opens up a huge market for us. And a lot of use cases are such, especially if you take freelancers where the receiver is initiating the request for payments. So we are already seeing very good early adoption in that space. If you think about the use cases, again, send is a predominant use case. But outside of that, I'd say we have rolled out Remitly Flex, which enabled the Send Now, Pay Later. So that journey is already underway for the last 18 months. The save and spend are initiatives we are working on right now. I'd say we have rolled out but selectively, and you'll continue to see us do more and more on that side.

Okay. Great. And clearly, all of those new products and then required investments and product tech, et cetera. So can you talk about how you're looking at balancing your growth ambitions with that sort of profitability as you move forward? And where should we think about that sort of margin trajectory for the long term?

Yes. It's a great question. I think about that a lot. And this also goes back to just the discipline that we have as a company in thinking about growth profitability, and capital allocation. This is where we don't want to get too swayed on either of the directions, and we want to have a balanced approach there. If you just look at our past as an indicator of how we have operated, we have been north of Rule of 40, Rule of 50 clearly over the past, call it, 24 months. And in doing so, if you just take the last quarter, for example, our revenue growth was 25% and EBITDA margin was 22%.

Again, a great example that we can do both the things at the same time. So while we are investing right now, we are able to generate good margins. And that is even before, call it, the AI advantages are kicking in. And another important facet in how we are running our growth portfolio is that all these are adjacencies, right? All the things that I said, whether it is all the customer categories or the use cases, none of them are like springing out of beyond the remittance business, if you may. And that's the reason why we are able to have a very, very synergistic growth plan.

So take, for example, Send Now, Pay Later, 0 marketing needed for that. The reason is that we are only offering Send Now, Pay Later to our existing customers and that, too, selectively for customers who have good credit history with us. That's one example. If you take Remitly Business, the infrastructure is exactly the same. It's offered in all the same corridors in the same rollout. Of course, we get to select, let's start with U.S. first, prove that and then move beyond. So clearly, there is an infrastructure advantage. If you take receivers, it's similar. The receiver relationship is already there, a little weak, but we can build stronger relations there. So a lot of it is adjacencies, and that creates a nice profitability angle to it.

Great. And as that margin scales up, how do your priorities on capital allocation look like, whether that's organic investment into the business, any opportunities for M&A, but also returns to shareholders, which is something that you have been doing more recently? So if you could expand on that as well.

Yes, very prudent capital allocation approach, something that we have deliberately thought a lot about and put in place. Our first priority is organic growth. As you highlighted, we have a lot of important initiatives in play here. And we want to make sure that we continue to deliver against that. And as we have said before, no shortage of growth opportunities, right? So high ROI opportunities in front of us. We are going to manage them in a high unit economics outcome way.

So that is the most important bucket, if you may, from our capital allocation perspective. As you think beyond that, we have put a buyback program in place now for over 3 quarters. And we feel that there is a great opportunity for us to return the money to the shareholders and also take the benefit of, in our opinion, what we believe is a discounted stock compared to the fundamentals and making sure that we can reduce our dilution as well as put money behind buyback.

And to highlight one data point there, last quarter, we tripled our buyback compared to the previous quarter. So we will definitely work with our dollars there and make sure that we continue to back our buyback program. The last point is on M&A. I'd say with -- especially with AI, the technology bar is very high. We can do things very quickly with AI now, as you know. And beyond that, we have a fantastic technology team, building Remitly Business receivers, send Now, Pay Later, so on and so forth. So organically, we have been able to leverage our technology teams to continue to build strong products and features. So I'd say that very balanced capital allocation plan, starting with organic growth and then buybacks.

Okay. Great. Zooming in on this year specifically, so you started off Q1 with, as you said, 37% volume growth, 25% revenue growth. So all of those are tracking ahead of even your guidance for the full year. So how do you think about the cadence of growth during the year? Any -- do you think about the seasonality? And maybe anything you're seeing right now given macro geopolitical uncertainty as well?

Think if you step back a little bit, I'd say the beauty about cross-border payments business is the resilience, and we love that business, right? Like we've seen that whether there are macro ups and downs, the business continues to deliver. And that's what you saw with the 37% volume growth. That's what you saw through the entire last year with very, very strong volume growth in the same 35% to 40% range. So that's the good part that the business is very predictable. And as we have said, our business works based on cohorts. And the customers that bet on us last year and the year before and so on and so forth are the ones that are driving majority of our revenue, right, 80%, 90%.

So the ability to predict our business is very good. We talked about record new customer acquisition last quarter. So overall, the business momentum is really strong. So that gives me a lot of confidence in the current quarter, in out quarters for rest of the year. So that's one strong fundamental aspect of our business. Outside of that, yes, there are nuances in Q1 and Q2 seasonality in H1 and H2. We talked about a few of those in our Q1 prepared remarks, a few being holiday timing, put forward a few things and created comparison, call it, differences last year versus this year.

Similarly, just the revenue comps that we had last year, very, very strong revenue growth, same like H1 last year. So it's a little bit of a comp distortion there. But if you tease out all of that, really a strong fundamental position that we have right now, strong growth, as highlighted in volume and revenue, and we feel that deep confidence in how we see our second quarter shaping as well as the full year.

Good to hear. At the beginning, you did talk about how you differentiate yourself and maybe we can go into that a bit more. So cross-border payments more broadly is quite a fragmented industry. Who do you come up against across the core sort of consumer market, but also as you move into high-value business with the key players in the space? And what is your win in those segments and I guess, the different criteria that customers would consider?

Yes. Yes. I'd say that if you go back to even a lot of thoughts we had shared at Investor Day in December, it's a similar thought process I'll share right now, which is if you think about our competition, I'd put them in a 2x2 scale or 2x2 framework. On one hand, it's scale, players who are, I'd call it, sub-$1 billion revenue and north of $1 billion revenue for ease. And on the other hand, you will take, call it, players who are brick-and-mortar and players who are digital.

If you think about, call it, subscale players in general, we have a massive structural advantage when it comes to cost, being able to do $75 billion, being, call it, top 5 player for our partners when we go and negotiate FX prices or other rates. In general, the cost structure benefits that you get when you are operating at scale just creates a huge advantage. So I'd say scale versus subscale is a huge advantage for us. And there are very few players who are at scale who are growing at the pace we are growing. You can count on one hand fingers.

On the other hand, if you look at traditional brick-and-mortar and digital, again, the business models are completely different, and there is a huge advantage being a digital player. And that's something that we have proven even with our expansion of EBITDA margins. So if you now parse it out to, call it, scale and digital players, I think that's what we think about as the real competition. And within that, we take a viewpoint of creating deep trust with the customer. We are hyper focused on making sure that the speed, the pricing, the, call it, ability for our customers to reach out to our customer support, just the overall customer experience that we give is differentiated versus anyone else.

And I'd say, given the market is fragmented, we are not as hyper focused on our competitor. We feel that there could be multiple winners in this space. What we believe is that if we can provide our customers a differentiated and a delightful experience, then we'll be one of the winners. That's what matters to us.

Got it. On your point about scale and how that drives cost advantages. So how do you think about then what do you do with that cost advantage, the ability to maybe funnel that back into price or again back into the business? And just more broadly, how do you think about your philosophy on pricing overall?

Yes. I'd say that, again, something that we think deeply is we want to provide our customers a very holistic experience. That is superior. And that holistic experience includes a fair price. It includes an experience that is stellar, whether it is the speed of app and the latency or whether it is customer support or whether it is with regards to any issues that they may have and the resolution thereof. So I think that's very, very important. And that also is true with the pay-in and payout experiences for any corridor that we support. So we want to give the best experience across each corridor to each customer.

And in that framework, we feel that price plays an important role, but it's not the only factor that plays a role. And this is where we want to make sure that we have investments in our customer support, in our technology and development, in our infrastructure setup, creating multiple options for pay-in and payout. So that's part 1. The part 2 is, as we have shared with regards to just the margin profile, we want to keep our margins relatively flat. If you think about our, what we call, revenue less transaction expense margin. I think that's -- we don't want to. We want to be thoughtful both for our customer as well as for our investors.

The benefits that we get, we want to pass it to both our customers as well as to our investors. And we know that below the gross margins, there is a lot of scale advantage that we can get. And as we scale, we can continue to leverage there. So overall, I'd say that's the plan that we have been running. That gives us a consistent RLTE margin, but massive scale on the bottom line through managing those fixed expenses. And ultimately, we want our customer to have a great experience.

Right. And how do you think about then the role of stablecoins, both in terms of, I guess, all of those things you talk about, the user experience, price? So what role does that play today and then maybe going forward?

That stablecoin is very interesting. We believe it is an enabler to our business and something that I'd say, augments really well with the existing infrastructure that we have. If you think about the 3 legs of our infrastructure stool, we have our partner ecosystem for our rails. We have the direct government rails, and we have stablecoin rails. So really being able to leverage the best option at that point of time for that corridor is how we optimize. So that's one way.

The second aspect is the customer side, which is what does the customer really want. If they want stablecoin, we'll provide stablecoin. This is where I have stablecoin on my wallet, customers can do the same and customers can transfer. We know that in some countries, especially where there is high FX volatility, Argentina being an interesting example. Sometimes the receivers want stablecoin instead of their currency, and this is where we have enabled that. We believe that this is of a nuanced use case rather than a primary use case. We are enabling that.

We'll continue to update you how we see the demand coming through. But right now, it's much more of making sure we can give all customers all different kind of options. The last aspect is around the working capital side. We have seen benefits there, but limited liquidity pools as we have shared before. Nothing has changed dramatically there. So overall, I'd say it's an enabler for us. It helps us. It's not a disruptor or a game changer thus far. But we are very deep in that, and we understand the technology well and want to make sure that we harness it for our customers' benefits.

And one aspect of stablecoins, which comes up is everything around compliance and so on. And that's a broader topic for the industry as well. So could you maybe again go into how compliance is design, how it works? How you approach building that relationship with regulators and then what that means from a customer perspective?

Yes. I think the good news for us that it is within the umbrella of our compliance program, right? So we don't want to take an exception there. And we want to again see what is the art of possible. We want to work with the regulators first and we want to make sure that we are complying through all of that. If you look at, call it, the rules of stablecoin in China or India are very different than Brazil, are very different than other countries, right? So Argentina, let's say. And we want to look at each country and be hyper compliant and at the same time, understand the regulations and where there is an ability to support that and support that as well.

So I'd say nothing changes for us dramatically. We have a very highly compliant infrastructure and everything that you said, the KYC and the AI/ML foundations are very strong with stablecoin as well.

Okay. Great. And AI is something that's come up multiple times in this discussion. How are you using AI to also maybe for helping the customer experience? And then you again mentioned that there's more upside potentially from AI from a margin standpoint. So how do we think about that as well?

I'd say early days on AI right now, but from a -- just a thought leadership perspective, we have a new CEO, Sebastian Gunningham, and he is very AI-forward in his thinking. He has already spent a lot of time. He used to run Amazon Marketplace and was there more than a decade. He brings a lot of that phenomenal machine learning, AI experience. He's been pushing really hard to make sure that we can think about both an AI-first approach of thinking from first principles, how to run an AI-led company. And also in terms of infusing AI in our existing workflows.

So if you look at all of our functions right now, we are deeply thinking about AI, have started leveraging AI workflows in a very substantial way. A couple of examples would be customer support. We've talked about it where we see massive efficiencies and just the ability to support customers across different channels through AI is very, very strong. The second example is tech and dev. Of course, that's like a use case that every company talks about, and we have seen great benefits there.

But beyond that, I'd say one of the things that we have done is come up with a new role type of job description, which is the knowledge development engineer. We believe that this is a role that can manage end-to-end workflows, leveraging AI. So we are substantially investing in rethinking some of the roles and how we can redesign the organization of the future. So overall, we deeply committed to the AI story, but as I said, early days. And every day, we learn more and every day, we continue to improve.

Got it. Maybe if we take a step back and go to some of those growth drivers you mentioned, you said geographic expansion or corridor expansion is one lever you can look at. What's the approach to entering new markets? How do you look at gaining scale, becoming competitive when you go into Saudi or any of these markets coming up?

So a few things. One is we have a very well-tested playbook. As I said, we were 1,400 corridors in 2021. Right now, we are 5,600 corridors. And the playbook has worked really well for us. We know exactly how to think about the stages of expansion. Now the second part of that, which is even more interesting is that every new corridor is nuanced. If you think about the payments that work in India versus Dubai versus Africa, it's all different, right? Pay in and payout types. And this is where we have to not only take that playbook, but customize for that new geography.

So behind the scenes, we have a road map on what that global expansion looks like. I'd say there are companies, there are corridors where we have seeded those corridors, right? So think about Japan, Brazil, and we need to really pour gasoline to really drive them much, much faster. So I think that's one category. The second is, if you think about newer geographies, Middle East is a big one for us. As I shared earlier, we have approximately 50% of the top 50 corridors or top 50 send countries. So if you take Saudi or if you take Bahrain or others, there is a huge opportunity there.

The regulatory construct there may be different. You may have to partner with a local player there or you may have to have a different licensing approach. So that is the customized aspect of it.

And finally, I'd say that our ability to have the same partner ecosystem quickly synergize is very helpful. So think about UAE, for example, most of the receive countries from UAE are India, Pakistan, Bangladesh, Philippines, et cetera. And because of that, we already have receive partners in all these countries. So when we unlock UAE, it becomes very easy because the payout side is already very well-baked. And the same would be true when we do that for Saudi or for other countries. So that makes it exciting. At the same time, it's not as huge of a lift. But again, every geography is nuanced.

Okay. Great. I think we're almost at the end of our time. So maybe to close, as you look out over the next year or so, what are you most excited about in terms of product, markets, et cetera? And maybe also, is there anything that keeps you up at night in terms of maybe some of the business you think about?

I think the most exciting thing for us right now is the leadership of Sebastian. We are able to think in a very different way. I think he is bringing an AI-first approach to running the company. He is driving focus with this 4x4 I talked about. There is an accountability leadership measurement and follow-through done in a very precise way. And the last thing I'd say on that is speed of execution. I think just the ability to come out with features and products in a weekly sprint rather than monthly or quarterly. Gone are the days where we want to sort of wait for quarters. Now it's on a daily and a weekly basis.

So I think that those are 3 that are very exciting. And I'm really looking forward to the results next year and the year after on how we can continue to diversify. Very important. Continue to harness the AI efficiencies and become a company that can show others how it is done. And finally, all of that should accrue to the business model as well as the financials. So very excited about that.

What keeps me up at night always is, are we doing the best we can do with our customer experience. And we are in a business where there are millions of transactions that we do. And how can we get to a place where all of them are defect-free. All of them have outstanding experience. How can we make sure that we do that in the most compliant way. So I'd say that's the most important thing for me. Fortunately, we have an awesome team. We have a great foundation and a phenomenal track record. So luckily, I sleep well at night.

Great. Sounds great. Thanks a lot, Vikas, for joining us and for sharing your insights.

Thank you, Aditya.

All right. Let's get started. Thanks, everybody, for joining. My name is Tien-Tsin Huang. I cover the payments and IT services sector at JPMorgan. And we've had Remitly come to the conference, support the conference many times in the past. And so super excited to have them back.

Sebastian Gunningham, the new CEO is here. So welcome. Thank you for being here.

Thank you.

And we've got Vikas Mehta as well the CFO. So I prepared a lot of questions. So hopefully, we covered all the topics that investors have sent through. So thank you for sending that.

But Sebastian. Again, thanks for being here. I thought we just kick it off with you, what's been 90 days or so.

Coming up on 90 days, yes.

Surprises. What are you excited about? What have you changed? What are some of the callouts that you call -- you'd mentioned to investors that maybe are a little bit familiar with the story.

When you join a company, one of two things happen, you begin to peel the onion and you: A, this is a terrible decision. The more you peel the worse it gets. Or B, is as you begin to peel the onion, the more you peel the better it gets. And I'm happy to report that Remitly is the latter.

I'd call out a few things. Number one is, we have a very unique customer base and the size of those markets is larger than I thought and even the adjacent markets. And so there's a lot of people -- the problem of moving money around the world is very complicated for most of these customers. And so the problem is still there, whether you're a business, whether you want to send $5,000 to India today, it's complicated. And so the markets are very large. There seems to be a large opportunity. We've built a fantastic network. And so surprise number one is I think there's a lot of runway for this business.

Surprise number two is it takes many years to build trust and the full second to lose it. And Matt and the team really over these 10 years, I think they were very focused on making sure that the service was fantastic. And so surprise number two is it's a very well put together company. We solve problems for us. This customer that's sending $100 back to their family needs a person to solve stuff for us. So I'd say that a very solid trust infrastructure.

And the third surprise, which is a little bit newer is, I think we're probably all living. AI is a big tailwind in all sense. I mean, obviously, we're all talking about the AI cost dividend, but the benefits of speed that AI brings really affects this business and helps this customer the benefits of trust that AI can -- I mean, we solve some pretty complicated problems. And so I'd say that the third surprise is, and I think we're all kind of waking up to this every morning is there are fantastic tailwinds and on the positive side of AI for our customers, for employees, and for the business in general.

Yes. I think sometimes too much talk of fear mongering and things like that around AI. So I'm glad you're speaking to it from a positive standpoint. We'll talk a little bit more about AI, but I think before we dig in, just thinking about -- and I really like your operating priorities that you called out, smaller team, speed. Some of it is AI oriented, right? And then focusing on your growth accelerators and core send, like anybody coming in that's new, putting in changes, what do you think you'll -- where do you think we'll see the most immediate impact across your operating priorities?

When you -- a fresh set of eyes on any company usually, you uncover the bottlenecks that are not so obvious for all of us work in different work environments, and we get into the rhythm of different things and so a fresh set of eyes. And I think probably the biggest impact is going to be the rate of change in our products and releases.

So we have a lot of ideas. If you -- we have these cards that are launching and the team told me that, a list of 100 ideas, and I was like, okay, listen, so -- and what's different, what's changing the world is usually you have to do a lot of choosing between A and B with AI and the speed and very small teams, you get to really increase the cadence of product.

And anecdotally, I think there's a direct correlation between more product and more revenue to just this. And so I think we have that ahead of us. And so I'm organizing the company to be very fast. AI, in some ways, you really have to change -- when you come in on Monday morning to a company that's moving with the speed of AI, is most uncomfortable. So you've got to change the machinery inside of how people work, the size of the teams, how the decisions are made, how the process are done, where do you take risk with AI and where you don't. Both in the financial industry, it's not a free for all with risk, that's for sure. So I think that you're going to see a very fast cadence of products and something that I think our customers are really going to enjoy.

Good. Now I do want to talk about product because, again, with the trust you have and the large installed base, it feels like an opportunity, right, to attach more product and expand ARPU. But before we get there, just the question around the decision process of going into the corporate workforce reduction, the 10%. The question of offense versus defense and what motivated that decision for you to do that? Again, I know it wasn't an easy one. And it sounds like you're redeploying the bulk of the savings there. But walk us through what changed there? What was impacted and what kind of savings -- redeployment of savings should we expect?

Yes. I'm going to -- I'm going to give that over to Vikas. I'm not -- it was a little bit overlapping with my first day, so -- and then I'll give you some comments on how I see it going forward.

Great. First of all, I'd say that we have remained very cost disciplined over the past number of years, and this was just another example of being very thoughtful and disciplined. The decision was something that we took with a lot of months of preparation and just deeply understanding the organization and how to frame it in a way that helps us be more and more productive over time. So it was something that was very well thought out. And as Sebastian said, we made that decision in February, but a lot of the planning was done prior to that.

As you think about, call it, the way in which we did that was -- it was more broad-based rather than focused on one particular function or one particular region. The second thing I'd say is that exactly as you were saying, we were looking at the future and saying what are the areas where we want to put our bets in and whether it is moving into the Remitly business customer category, whether it is expanding further into send now, pay later or wallet or with other initiatives like card. So a lot of it was to say, how do we free up the capacity, so we can put it to use in places which can accelerate our growth for the long term.

Yes. And looking forward, there's no doubt that with AI, you can do more with less. And the killer app with AI right now is in the software factory, right? And so I think all of us have this interesting dilemma going forward, which is if you're saving $100 on people with AI, A, are you going to spend tokens? Is the person going to be -- is the $200,000 engineer going to be replaced by $200,000 of token.

Number two is to give it to the bottom line. Number three is, if you've got a lot of growth markets, you put those $100 into growth. And so you -- all our investors are going to I think ask every company, okay, it's clear that there's $100 somewhere in this tailwind of AI, what are you going to do with it? And I think there's different answers for different situations. We're looking at all our options. We're very biased to the growth. We have very large markets. We have lots of opportunities. So to do more with less, I think is going to benefit the overall top line more. And obviously, we'll balance some give on the bottom line also. But it's a happy problem in some ways that we all face for the next 2 or 3 years.

Okay. No, good. I'm glad...

And I will just add, which is in the net balance of equation, what you saw us raising EBITDA guide beyond the Q1 beat by approximately $10 million was essentially, as Sebastian said, passing it to the bottom line, while redeploying it for growth initiatives.

So organizing things will be something we need to prioritize. I like the 4 x 4 matrix that you talked about, right? And I wrote it down without my reading glasses: core senders, high-value senders, businesses, receivers. And then, of course, you're competing in your core send business, and then there's borrow, spend, and save talk about that which -- with quite a bit. So how should we organize across that matrix in the what you're focusing on first?

Well, the -- it's a very simple matrix in the sense that I'll give you comfort that we didn't invent these customer pieces. So the high value -- we were looking at our data, and so most of our core senders are sending $200, $300 -- $250 home on average. But we start to look at the data and there's a bunch of $5,000, $10,000, $20,000, $30,000 remittances. So -- and that customer is different. They're usually sending for investment, for real estate, they're sending to themselves. You need a white glove service. So that -- when we saw that, then we're going to double down. It's a huge market. And so we're going to build -- we've built a team that's dedicated to that.

The same with business. We found a lot of businesses using Remitly to send money all over the world. And so we said, okay, that's a different -- they need to do bulk send, they need to send to 3 people, not just 1. You can imagine all the business use cases.

And then this other market, which is the millions of receivers around the world who get money, and we don't do anything with them. They've interacted with Remitly. They've had a great experience. They receive the money. It's a happy moment. And so we've got that big market ahead of us.

And then on the other side, we've got the Send which is sort of say, there's 16 boxes, there's one which is the big box, which is Send Core. We've got a bunch of boxes that are already non-zero. So we think we have a very right to play in all of them. We're going to prioritize obviously the biggest opportunities.

Right now, we're looking at it from the customer perspective. But we've been testing some what we call Send Now, Pay Later, which is a killer idea. Customers love it. We give them $100 to $200 for 30 days for a short-term liquidity. We know the customers invite only -- we're very excited about that program. We've obviously got all kinds of debit cards and credit cards, not credit -- debit cards, where we can inject loyalty.

So it's just -- there's an overall relationship that comes. Remember, this person usually comes to a country. He doesn't have a credit history. We can help them with that. He doesn't have access to the financial system in general. So if you put that all in a package, we have a lot of products we can inject that. Lending is one, spending is one with a debit card, and saving is another. We can have a current account. We can do multicurrency, all the very, very basic needs of this segment. So we're going to go after our 4 x 4. We've got a lot of boxes to fill. And we think there's a lot of growth in those areas.

Let's just stay with this, if you don't mind...

Yes. Yes.

An important subject for me, right? You have the trust with that user, right? They're probably underserved from a banking perspective. So you mentioned it right, you're going to push borrow, spend and save, which means you're going to compete more against some of these neobanks that are all trying to do the same thing, right? They're all familiar including the BNPL, companies who are trying to bank their users, this whole concept of embedded banking and embedded finance, but it feels like the remittance side because you already have the inflow of money gives you a natural opportunity to extend into these areas.

But how do you view the competitive landscape there, Sebastian, as you study it from the outside. Is this how real or easy or hard will this be given the competition is all trying to do the same thing?

Yes. It's somewhat ironic that all the banks want to get into remittances and all remittances just want to get into banking.

That's right.

But I'd say -- well, number one, I'd say these are very big markets. There's not a one winner -- there's not a winner takes all market. There'll be a lot of great winners and you're seeing a lot of new banking often. I was just putting the buckets into a banking bucket or a remittance bucket.

I think that if you really just chase -- and people like Chad have probably done this very well. Would you just chase what the customer needs, you end up in the right place. And some of it is services that the banks provide and some of it is services that are very unique to our customer base. For us, Send is our anchor. So we're -- we've built this global cross-border infrastructure to send money.

And so when we think of lending, when we lend you $100 our customer base, you can only do one thing with those $100. That's send it to your family. You can't go by shoes, you can't go buy candy. We lend it to you in the Remitly account and that money goes one place only, that's the Send. And we'll do the same with all the products. So we're anchored on Send. That makes us a little bit different than a bank.

And then we're going to build out, and we'll see in some places, overlap, some places, partnerships. I think there'll be -- it's a big world out there and a lot of unsolved problems. So I think that the best will win. I will say just to wrap up the thought, you got to be low cost, you've got to send money fast, and you've got to provide a great service. If you don't do that, you're not winning in this market because there's a lot of great players that are participating.

How much of a differentiation do you can drive with this strategy to further support or amplify your Core Send business? Because the question from investors, Vikas, you know this is pricing, is it a race to the bottom on the pricing side. But could this change the competitive dynamics as you think about just Core Send, if you bring it back to the core business?

I think at the highest level, you're getting a certain revenue per customer right now, and this is basically with the remittance business. I think there are many opportunities to grow that revenue percent. The revenue per customer around all these borrow, save and use the money, so I think that the -- I think remittances is a great anchor to start.

Like if you gave me a choice, current account is probably a good one, too. Like if you gave me a choice, I look at all the financial infrastructure of your life, and I'd say where would I like a starting point to be able to build on? I think sending money abroad is pretty -- it's a pretty good place to start, and that's where we are.

Agree. You gave me inflows right up front. I mean that's...

That's right.

So I don't want to...

Tien-Tsin, a couple of points. The first one is the incrementality. As you said, I think we have seen already we have run this program now for more than 12 months. And we have seen cohorts of users where if they have Send Now Pay Later, they are sending more than what they used to. So clearly, that's driving growth, which drops to bottom line.

The second is we are -- as Sebastian said, we are only lending to our existing customers. So we have underwriting history, and we have seen their behavior. So that's another I'd say, strength that we have and a differentiator. The final point I'd make is a lot of these are adjacencies that we are going into, which means that from a cost perspective, there's a natural advantage. We are not really doing step function changes. A lot of it is just redeployment as we spoke earlier. So the inherent economies of scale continue to accrue even as we move into Send Now, Pay Later or Remitly business or other things that you mentioned.

Good. Incrementality is important -- look, I think it's a fun thing to talk about that's why I want to spend time upfront. I'm feeling the heat from not asking some stock questions. So I'll get into that, but thanks for going through that.

So let's bring it back to the quarter and sort of the outlook, a popular question people had me ask you here is just thinking about the second quarter and the implied reacceleration in the second half. What's driving that confidence to show the acceleration in the second half? Maybe just getting back to the business here.

Yes. I'd see that, first of all, as you saw really Q1 sets the foundation for the full year. The second is, I think the way even we shared that in our earnings prepared remarks, which is a lot of it was timing changes or One-timers, which were creating a little bit of Q1 to Q2 change there.

If you combine Q1 and Q2 and just look at H1 and then look at H2 or look at Q3, Q4 it looks much more linear. So there's no real big change happening. And this is important to understand because our business has a lot of predictability, and it is linear growth. So what we are really excited in the second half is the growth accelerators as they kick in. Our core is strong. Our U.S. growth was 25%, and really strong growth, and volume really growth in QAU, record net new customers, which always is helpful because that sets the base for years to come.

So really feeling confident about solid setup to the year. Looking at H1 in entirety is the right way to do it. And second is growth accelerators kicking in second half, of course, much more in '27 and '28. That's what excites us.

I think also if you think about the inputs of the business, we continue to improve our cost structure, we continue to add new partners around the world that can distribute money. So when you're sending money to any country, you've got 4 or 5 options, we continue to grow the number of new corridors that are launching, we continue to grow the number of countries that could send money out. So we've got 3 or 4 announcements coming up new countries that can now send money out.

We continue to grow the speed of the money. We continue to grow the quality of the app, we continue to launch new features. So all the inputs, these are all small little pieces, our service is just continuously getting better with the help of AI, the speed at which we answer calls and solve problems. So you just put all that in a cocktail and there's a good momentum to the business in addition to some of the factual things that are driving the growth.

No, thanks for going through that. How about just the incremental margins then because there's a -- I know you did a reduction in force, but there's also a need to spend in market and drive awareness of some of these new products but continue to grow the core, including corridors, as you both mentioned, is there any change in the incremental margin trajectory?

I'll give you the numerical view and Sebastian can add more of the, call it, organization view. If you look at our history, we've had, call it, margin expansion every single quarter over the past many, many quarters, even as we look into Q1 and future, we have leverage across each line, right? So the incremental margin potential in this business is strong and solid.

The other important part, which we touched a little bit, but I can be more explicit which is investing in new growth, which is the growth accelerators is done very thoughtfully. And in a way, that is redeploying some savings, but also dropping some of that to the bottom line. So we feel really good about incremental margin potential of the business. Again, we explained a lot of one-timers in Q1, which make it a little noisy, but if you parse that out and look at just the consistency of incremental margins that should continue.

Yes. And being good in this business has a scalable flywheel. Communities -- all these communities are quite close knit. They share their experiences, I use Remitly to send money. It was really well priced, it was very fast, it was great. And then on the receiving side, you also get these -- so the business has unit economic scalings, but it's also got appeal scaling like in a way that the larger you get, the more people get to know about you the more, especially if you're good, those experiences grow. I lived this at Amazon. We did very little marketing, but just the word-of-mouth in the school yard just got that flywheel spinning. And I think that's a very important part of our future, too.

Yes, probably underappreciated. Staying with -- I do want to ask about CAC, but just thinking about one nerdy question around the model and expenses. It does feel like transaction loss has been running on the low side. There's a lot of ways for me to ask this, but it feels like some potential the base set of baseline lower than the 9 to 13 that you've talked about, whether it be with using Stablecoins for settlement or just seeing better data. But on the other flip side, you are doing higher send, higher amount businesses well, which could expose you to more risk.

So how do those things build together to think about transaction expense because it does feel like it could go lower.

Yes. So I'll pass that into 2: Transaction expense and transaction loss. Transaction expense, I think we've been very disciplined and continue to see the leverage. Again, mix has role to play, and we have talked about it being payout different choices. And thus far, we have seen the shift to digital has been very helpful, especially on the payout side, and that's been driving some of that leverage. I think the more interesting point, which is what you were highlighting was the transaction loss where we saw a step change reduction in fact, Q4, we had 7.2 bps. That was the low that we hit for a long, long period of time and then more recently, 9.3 bps.

Now what is underpinning this success is a shift in the models. We were able to incorporate a lot of learnings and use AI/ML to make it more powerful model. And what was most impressive here is that we were not degrading the user experience at all. The sideline rates were also at its best. At the same time, the transaction loss was at its best, best of both the worlds that's what we want to see. Now keep in mind that last year, in Q2, our transaction loss was 15.3 bps, right? So it hit another end of the spectrum. And this is what we are dealing with here, which is sometimes it's 2 steps forward, 1 step back.

And I'd say give us a few more quarters. Right now, the range I'm using -- we are using is 9 to 13 bps. That's what we have communicated historically, which is taking 11 bps as an average. If we continue to see this performance over the next couple of quarters, I think it will be a good opportunity for us to rebase line it.

And then the stablecoin low-cost rail settlement opportunity, how real is that?

So this is interesting -- it's evolving fast. We've analyzed all 5,000 of our corridors, the pay in, pay out, the exact unit cost, FX, et cetera. So we know in detail the cost of every corridor. And we've compared it to what would stablecoin cost be.

And as of today, Monday, 90% of our corridors using fiat, using the old-fashioned system are lower cost than stablecoin. There's about 10% that are more efficient using stablecoins and we're all in using stablecoins in those corridors. So as of right now, it's a small piece of our overall infrastructure. We're very efficient already in our cost structure. But remember, it's not only just the rails, you've got to do all the KYC, the AI/ML. In this business, you need to know who's sending the money and do you allow that transaction through, as you know. And so if you put all the pieces together some really nice places to use stablecoins, but the majority is still our old-fashioned infrastructure works very well.

Yes. The 90-10 is a great stat to have. On the just -- we're almost out of time. Just thinking about the actives, quarterly actives Sebastian, and you mentioned Amazon and what you've learned. I think you're growing close to 20%, I believe...

Yes.

On the consumer side. So is the CAC model changing? Do you see some opportunity to maybe dial that up or down? And then I have a follow-up on the customer side.

Yes, I think -- well, let me put it this way. It's not going to go up. I think that AI -- I think every marketing organization in the world, or every -- is starting to rethink how you do marketing. And we've got a lot of unknowns around the corner, which is what rollout the LLM is going to be. We've launched WhatsApp, which is growing very fast as a way to acquire customers and customers use it. We've launched a way on ChatGPT to query the prices. So there's a lot of change ahead. I think -- and we can obviously continue to get efficient when you start to get unstructured data with these LLMs combined with structured data and all these machine learning models in marketing.

I think you've got a lot of opportunity. So I can't -- we have our CAC. It's part of our business. I think that over the next few years, we're going to get a lot of leverage on some of the new ideas, the data and how marketing evolves in our space.

Okay. Good. And just the health of the user base that you have, especially you're coming in and observing it. I know resiliency has been something Matt has reached to us for quite some time. But with higher energy prices, I know tax refunds just happen. There's a lot of geopolitical concern out there, employment seems full in this category. What signals are you watching on the consumer? Is that a high high-risk area for you?

Yes. It's a very price-sensitive consumer. You got to win with cost. If not, you're not going to win. The -- we see -- we have a -- like all consumer base, we've got a very loyal base. We've also got consumers that shop around a lot. But in general, we're very happy with how the models were playing out. We see people just grow all the cohort analysis that we do. This is a service that people come back to. And the team -- Matt and the team and all the team has been here, build something that's very structurally very, very solid, customers love Remitly, they come back. And I think that bodes well for the future of the products that we're going to start to introduce to them.

Yes. So send now, pay later is one. I know you've got the wallet, the card. So you're going to learn a lot of line of credit...

Line of credit.

as well, what guardrails do you have in place to ensure that you're extending credit and can pivot if things change?

Yes. I'd say that we learned a lot over the last 12 months. We ran the Flex program. And we did a few experiments there with different membership rates, call it, $7, $10, we had models where we would look at different cohort types. And through that experience, we learned a lot. And we felt really confident that this business is really good unit economics and the business model works. And this is where, as Sebastian joined, we made the decision to get to the next stage of it, which is work with a banking partner and create an arrangement where all the credit access is given through that bank.

We own the risk because we -- again, know the benefits of learning from the underwriting data and hence, we can get low cost of capital from the bank. So it's really a good model in that sense. And then bringing that and pushing that forward with a card product which is really important glue to that whole initiative is how we want to take it further. But overall, we feel really good about the unit economics. We have the data, which helps us keep those guardrails, in terms of loss provisions. Third is it's invite only. So we are the ones who decide whom and how much credit we want to give. So overall, really good checks and balances, very strong leadership behind it, people who have done it for decades, and that gives us a lot of confidence to keep it going.

I did get a couple of investors that asked me to ask you all which is the -- is that banking product specific to consumers? Or is it also applicable to small business as well thinking about because that's a big theme in payments right now is the bank those small business.

Very, very good question. I see us not yet, but it's in -- it's on our list. I think that there' a very big industry and a very big business out there to do small business lending well done. And we -- not -- and all this -- and all our planning, and all the ideas right now it's on the list, but not immediately.

Tien-Tsin you could take another end to it, which is the receiver credit. We know our receivers also well, they receive money from our senders on a regular basis. So as Sebastian said, hundreds of ideas and a lot to work through.

Okay. No, I know it's growing very quickly, so natural to think that, that maybe is something down the road.

Okay. Almost out of time, just thinking about M&A, I think Sebastian in the call you said, you are building the muscle, but not ready to do anything that's too obvious, but to get to where you want to be again, especially with some of these newer products, I know the velocity is moving up internally, but would it be easier to buy in and give some scale in some of these tangential spaces? Is that a priority?

Yes, we're building the machinery to at the right time, go on offense. We've got these 16 boxes. I think every box has a different answer. One could be a partnership, one could be an acquisition. In some cases, you may want to acquire customer, in some cases, you may want to acquire market share, in some cases, you may want to acquire technology. So we're doing a lot of work. We're building a team. We're going to get very good at this. We're generating the free cash flow that we need and obviously building up the equity value. So I think the time will come. It's not now. We're very focused. I think we have to put some -- a few more pillars in place, but I see us going on the offense in the future.

Okay. Good. We're less than 2 minutes left. So I thought we'd close it out. Maybe just ask you, Sebastian is the easy question of -- we talked about a lot of different things -- sounds like you have a lot of energy in going after it. What are you most excited about, right? If we're spinning it forward a year from today and you're back to talk about something new that we haven't discussed, is it something there? Or is it back to the matrix, what would you tell us that you're most excited about?

I think that the company does have a bit of a missionary feel to it. This is a customer -- and this customer has a rock and roll in their life with everything that goes on around them that they don't control. You mentioned gas prices. And so we have a really nice list of things to help that customer.

And I think it's kind of -- and I've run into a few -- I was talking to some people at home the other day who are using Remitly. And it's just as you knock out, they say, this is amazing, accept money through X, Y, Z, and it arrived under 15 seconds. Now I can do this and now I can do that. And so I think that it's fun to join a company. I mean we always have to -- work is work, you work very hard. We have to generate money. We've got to keep everybody -- shareholders, employees, and customers happy. But I think the next -- I think I'm very looking forward to the next 12 months to all this sequence of products that I think we're going to get a very, very good reception in our customer base, and of course, grow the company, which is the ultimate objective here.

Yes. No. It seems like product velocity is a big theme in payments in fintech...

Yes, definitely.

There's going to be a lot to track with Remitly. But thanks for giving us the update. I appreciate you being here. Awesome.

Awesome. Thank you very much.

Thank you, both.

That's great.

Good day, and thank you for standing by. Welcome to the Remitly Q1 2026 Earnings Call.

[Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, David Beckel. Please go ahead.

Good afternoon, and thank you for joining us for Remitly's First Quarter 2026 Earnings Call. Joining me on the call today are Sebastian Gunningham, Chief Executive Officer of Remitly; and Vikas Mehta, Chief Financial Officer.

Results and additional management commentary are available in the earnings release and presentation slides, which can be found at ir.remitly.com. Please note that this call will be simultaneously webcast on the Investor Relations website.

Before we start, I would like to remind you that we will be making forward-looking statements within the meaning of the federal securities laws, including, but not limited to, statements regarding Remitly's future financial results and management's expectations and plans. These statements are neither promises nor guarantees and can involve risks and uncertainties that may cause actual results to vary materially from those presented here. You should not place undue reliance on any forward-looking statements.

Please refer to the earnings release and SEC filings for more information regarding the risk factors that may affect results. Any forward-looking statements made in this conference call, including responses to your questions, are based on current expectations as of today, and Remitly assumes no obligation to update or revise them, whether as a result of new developments or otherwise, except as required by law.

The following presentation contains non-GAAP financial measures. We will reference non-GAAP operating expenses, adjusted EBITDA and free cash flow in this call. For a reconciliation of non-GAAP financial measures to the most directly comparable GAAP metric, please see the earnings press release and the appendix to the earnings presentation, which are available on the IR section of our website.

Now I will turn the call over to Sebastian to begin.

Thank you, everyone, for joining our first quarter 2026 earnings call. Q1 was another exceptional quarter for Remitly.

We delivered record revenue and adjusted EBITDA, both above the high end of our guidance ranges and another quarter of record adjusted EBITDA margin and net income, and adjusted EBITDA exceeded $100 million for the first time. These results reflect 3 durable characteristics of our business.

First, a resilient business model, which led to another quarter of share gains; second, growing contributions from new businesses and categories; and third, continued expense and capital allocation discipline.

Each of these durable characteristics continue to compound, giving me great confidence in our ability to generate sustainable long-term growth in revenue, profits and free cash flow. That confidence was reflected in nearly a fourfold increase in the pace of share repurchases this quarter.

I want to use my time today to reflect on what I've learned in my first 90 days, discuss our evolving approach to delivering customer value through new products and offerings, and expand how we plan to use AI to drive growth and continued operating efficiencies.

In my first 90 days as CEO, I've been very focused on gaining a deeper understanding of the business. I traveled to a number of our global offices, spent time with teams on the ground and conducted internal deep dive spanning product, engineering, marketing, finance and operations. I also spent time talking directly with our customers to understand firsthand what they value most of our product. It's been an intense 90 days.

My goal was straightforward: understand what is working, what can work better, and learn as much as I can about the people and the culture that built this great company. I've also made some important people, product and operational changes that are quickly helping accelerate the trajectory of the business.

From this period of listening and learning, a clear set of operating priorities has emerged. I have already begun putting them into action. We rely on smaller teams to drive ownership and autonomy. We will distinguish clearly between our core remittance business and newer growth initiatives, allowing each to operate with the speed, focus and rigor as required by the stage of maturity. We will adopt a disciplined approach to building products, starting with customer needs and working backwards. We will embed AI across everything we do, and we have designed the company so that speed is the default.

My time with employees and customers also reinforce 3 things I believed about Remitly before joining.

First, the culture is genuinely distinctive. There is a missionary energy here and a sincere belief that moving money across border should be reliable, fast and fair, especially for a community that has historically been overcharged and underserved. What sustains that culture is the caliber of the people who carry it.

Across every function and every country I visited, I encountered talented, deeply committed individuals who bring real energy and care to this mission every day. That culture and those people are a real competitive asset, and I intend to protect and amplify both.

Second, our core strengths, trust, network breadth, and operating scale put us in a strong position to continue gaining share and growing our offerings to better serve the cross-border needs of our customers.

My conversations with customers reinforce that trust is the most consequential of these strengths. These are people sending money for life-changing events, supporting family members, covering medical bills, building a future from a distance. For them, knowing the money will arrive reliably, quickly and fairly is paramount. And if things do go wrong, it is important that they know there is an instant 24/7 global structure in place to fix it. As financial services become increasingly automated and digitized, trust becomes more valuable, not less.

Our disbursement network, customer support excellence and compliance capabilities create a trust and safety advantage, a durable, hard-to-replicate edge that protects our customers in every corner of the world and strengthens our global platform.

Third, I believe AI and stablecoins will accelerate our growth and not just incrementally. Companies like Remitly with trusted customer relationships, complex regulatory dependencies and a proprietary network infrastructure will be great beneficiaries of AI tailwinds. The company now knows I'm somewhat obsessed with this newly found intelligence into our business.

As I will explain, we are moving quickly to ensure we take full advantage of AI to move faster, lower costs, improve product quality and compress product development time lines.

Stablecoins are a different kind of opportunity, not a universal solution, but a targeted one. In corridors where they offer a clear cost or speed advantage, stablecoins gives us another tool to reduce FX costs, improve settlement speed and efficiency and deliver better outcomes for our customers.

With that as context, let me turn to how I'm thinking about the opportunity ahead and why I believe we are only beginning to scratch the surface.

When I joined Remitly, I was asked whether I plan to change Remitly's strategy as the new CEO. The answer is no. The vision, the customers we serve, the focus on cost, speed of delivery and trust are right, and they will not change. What I differ, is the pace with which we can achieve our vision and execute our strategy.

I have full confidence Remitly will be a large, more diverse provider of cross-border financial services and the most important app for those that send or receive money internationally.

To explain why, let me share a framework I've used internally. I think about our opportunities a 4x4 matrix, 4 customer categories on one axis and the 4 primary ways we can deliver value to those customers on the other.

The 4 categories are: one, our core senders, our established base who send money for critical nondiscretionary reasons; two, highly valued senders, a fast-growing category with significant untapped share for Remitly; three, businesses, a massive and underserved category for which we are seeing rapid traction even with a very early feature set for this customer. And the fourth category is receivers, the 30-plus million people around the world who receive money through Remitly, most of whom are not senders today.

For each of these customers, we are grouping 4 categories of product offerings, broadly defined around sending money, borrowing money, spending money and saving money. At the intersection of the 4 customer and product categories are many unique opportunities to serve our customers with products they need to live their cross-border financial lives. Each customer category and product offering reinforces the others, drawing on shared infrastructure and data to create compounding benefits as we scale.

Core Send comprises the vast majority of our revenue today and is the base from which all our offerings are built, leveraging 14 years of experience, network depth and optimized cost structure as well as a DNA of trust and speed that is difficult to replicate. Everything outside of Core Send, we think of as growth accelerators.

Our Borrow, Spend and Save products fuel a flywheel around sending money by addressing a broad set of cross-border financial needs. A more complete financial services experience, in turn, drives improved loyalty, higher remittance volumes and diversifies our revenue sources.

This matrix is not a change, but a refinement of the strategy we presented at Investor Day. It provides a blueprint for execution and a disciplined lens for prioritization. We will go deep where the opportunity is largest and where we have the clearest right to win. And when I look at where we stand today, we have honestly only just started addressing a handful of these opportunities.

I'll provide a brief update on recent progress and initiatives across each of our key near-term opportunities, starting with Core Send.

In Core Send, we improved our distribution through new or expanded integration with WhatsApp and ChatGPT and deepened our network reach across every region we serve, improving reliability, speed and access for customers around the world. On the Receive side, in Latin America, we integrated Bre-B, Colombia Central Bank-backed instant payment rail and added Banco Bolivariano as a direct bank partner in Ecuador.

In Asia, we added KBZPay in Myanmar, Rocket in Bangladesh and Coins.ph in the Philippines, extending our reach to tens of millions of users with near instant fiat and stable coin wallet-based payouts. And in Africa and the Middle East, we launched new Receive markets, including the UAE, bringing total received countries to 170.

On the Send side, we enabled Discover card acceptance and launched access to FedNow and RTP in the U.S., allowing customers to fund transactions instantly from bank accounts while lowering our costs.

Underpinning all of this, continued innovation in our payments and fraud system drove card acceptance and authorization rates globally in Q1, reinforcing network strength while improving speed, reliability and the customer experience. In the near term, we are focused on using AI to deliver real-time automated pricing across our 5,000-plus corridors, enabling regional leaders to capture incremental demand by delivering more customer value.

We will also apply AI across the Remitly experience to improve the moments that matter most to customers, how long that transfer takes to arrive, how they pay and how we keep them coming back. And we will accelerate the pace of geographic expansion, bringing our leading digital remittance experience to some of the largest, fastest-growing Send and Receive countries in the world.

This quarter, we updated our definition of high-value senders to include only those who send 5,000 or more in a single transaction, which better aligns our strategy, focus and resources with the specific needs of these who send higher transaction amounts. This customer needs a high-touch, certainty-first experience. And when we earn that trust, they generate substantially more value per customer than our core senders.

In Q1, we continue to remove friction and improve the experience for these customers by increasing send limits with network partners and simplifying the onboarding experience.

Our near-term focus for this category is to streamline pay-in methods and improve our risk assessment process while better targeting and addressing the specific and diverse needs of customers within this category.

Our business offering continues to scale, growing volumes 30% quarter-over-quarter ahead of expectations. In Q1, we launched our Business Receiver product in 5 new countries, allowing freelancers and contractors in parts of Latin America and Asia to request and receive payments from clients in 26 countries around the world.

We also launched a new feature that allows businesses to initiate the payment process by sending a link to the recipient's e-mail or phone, eliminating cumbersome data management and trust issues that often cause friction for small businesses.

Our near-term focus for our business offering is continued improvements on the onboarding experience, geographic expansion and a steady drumbeat of features that appeal uniquely to small- and medium-sized businesses sending money internationally.

Our Receiver strategy targets the more than 100 million people in the world who receive money in one currency and spend in another. Last month, we reported our first Receiver transaction following the launch of our Receiver & Request product in 6 countries, creating a new source of cross-border volume in countries where we already have a strong Send presence.

With this launch, we also introduced a wallet that enables receivers to hold funds in USD or USDC stablecoins and withdraw to local bank accounts, mobile wallets or cash pickup locations. Our near-term focus for receivers is country expansion and enabling widespread access to stablecoin across our wallet offerings.

Moving to Borrow, Spend and Save. Last year, we announced a range of products aimed at supporting these use cases, Send Now, Pay Later for our customers' liquidity needs and wallet and card for sending, spending and saving money with benefits. We have seen strong traction with these offerings as we continue to build, test and iterate with revenue more than doubling year-over-year.

Building on these learnings and experience, this quarter, we will expand our offering for customers who have a need to Send Now, Pay Later, Spend and Save. For a low monthly fee plan, these customers will receive access to a global debit card to spend, a wallet to save, a short-term line of credit offered by a bank partner for remittances and benefits to reward loyalty, remittance use and the timely payment of credit balances.

We believe there is a strong preference among customers with short-term liquidity needs for a card-based experience, where loyalty and rewards are a central feature. This will be the first of our Remitly card offerings that target specific use cases, addressing the unique needs of a broad cross-section of our customers. We have a long list of ideas for our card platform beyond Send Now, Pay Later that we plan to execute over the coming quarters.

Our goal is to make the Remitly card the most versatile and best debit card in the world for the 300 million international migrants and 80-plus million small businesses worldwide.

Our strategy is simple: expand the value and capabilities we deliver to the broad range of people and businesses sending money globally. Investors should expect a meaningful acceleration in the pace of product enhancements as we expand our offerings, guided by the operating principles we have put in place around clear ownership, distributed accountability and a bias for speed.

Finally, I want to touch on the benefits we expect to derive from AI. Over the past several months, many of our peers have reported significant AI-driven gains in productivity and cost efficiencies. The pace of AI advancement is real and the impact is substantial. Remitly is fully part of the shift, and I will lead that effort aggressively.

We have organized our thinking around 3 types of AI benefits.

The first is the cost benefit, which drives greater operating efficiency and long-term cost savings. We've gone methodically through the organization function by function, to identify where we can use AI going forward to drive efficiency gains while maintaining or improving productivity.

Through this process, we have identified opportunities to streamline our organization, building on the more than 250 headcount reductions and over 50 roles redeployed through efficiency gains year-to-date. That is a deliberate choice grounded in our confidence that AI-driven efficiencies can allow us to do the same work and in most cases, more work with a leaner organization.

The second benefit of AI is speed, which helps unlock a faster operating cycle. Throughout our product and engineering teams, a new profile of skill set is emerging that combines product design, engineering depth and AI fluency in one person.

We are calling them knowledge development engineers, and they are helping us disrupt the decades-long bottlenecks of product ideation, building, testing and launching from months and years to days. I would note that eliminating one bottleneck quickly reveals the next.

So, as a company, we are actively rethinking every step in the process to deliver products that are, that move seamlessly from idea to customer value to deliver exceptional products and services. The speed AI benefit is harder to quantify than the cost benefit, but we believe its potential compounding effect on our ability to build, ship and iterate will be an enormous structural tailwind.

The third and most consequential benefit of AI in the long run is the trust benefit. For our customers, trust means safety and comfort, speed and fair pricing and a high-quality person to talk to when things go wrong.

AI can improve our ability to deliver on all 3. Take localization at scale. With AI giving us a broader and deeper understanding of our customers, we can now tailor the experience across every corridor with a level of personalization that wasn't previously possible.

That relevance builds trust and trust underpins everything we do. 3 to 4 years from now, I believe this company will generate significantly more revenue with roughly the same number of people. The AI benefits is how I believe we will generate the investment capacity to get there, and we intend to put a large portion of that capacity back into growth.

Let me close with this. Q1 was an exceptional start of the year; record results above guidance and a business that continues to demonstrate its resilience and its upside. But what energizes me most is not what is behind us. It is what lies ahead. We have a core business that is growing and improving. We have a strong portfolio of growth accelerators that are at the very early stages of what they can become.

The early benefits of AI are beginning to create real measurable capacity for investment. And we have a team and a culture, I believe, is among the most mission-driven I've encountered in my career.

I want to thank every member of the Remitly team. The execution, the energy and the commitment to our customers that shows up every day are what makes these results possible. And I want to thank our investors for their continued confidence and trust in this company.

With that, I will turn the call over to Vikas.

Thank you, Sebastian, and good afternoon, everyone. We delivered another quarter of profitable growth and strong free cash flow, reflecting continued share gains and solid execution.

First quarter revenue was $453 million, up 25% year-over-year and $16 million above the midpoint of our guidance. Revenue outperformance this quarter was driven by a number of factors.

Recent regulatory changes in the United States drove an increase in customers' use of digital remittances, resulting in record new customer acquisitions. We also benefited from elevated demand associated with higher tax refunds in the U.S. and favorable market conditions in key corridors.

Adjusted EBITDA was $102 million, $19 million above the midpoint of our guidance. Adjusted EBITDA outperformance was driven by higher-than-expected revenue, lower-than-expected transaction losses, and short-term pause in hiring following in-quarter headcount reductions.

Now let me share an overview of our first quarter results and then provide our outlook for the second quarter of 2026 and our updated guidance for the full year.

Unpacking revenue growth drivers for Q1, Send volume grew 37% to $22.1 billion. Supporting this strong volume growth, Send volume per active customer increased to nearly $2,300 or 14% year-over-year growth, a record on both an absolute and percentage growth basis. This was driven by growth in both transactions per active customers and record growth in average transaction size as we continue to win share and gain traction with high-value senders and business customers.

Quarterly active customers grew 20% year-over-year to over 9.6 million, ahead of our expectations. QAU growth accelerated quarter-over-quarter, reflecting the shift in offline to online conversions associated with recent regulatory changes in the United States. Our Skip the Line campaign, highlighting the lower cost and convenience of digital remittances has been effective in attracting new customers seeking alternatives to traditional cash-based remittance methods.

QAU growth was further supported by improved retention, reflecting enhancements in the core product to improve speed, reliability and the overall customer experience. As expected, volume and revenue exceeded QAU growth, as we saw a greater mix of Send volume from high-value senders and businesses. Our take rate this quarter was 2.05%, in line with expectations.

The year-over-year change was driven primarily by growth in volume from high-value senders and business customers as well as a higher digital payout mix, which improved by more than 250 basis points year-over-year. As I have discussed in previous quarters, take rate is heavily influenced by mix, so it is not a great metric for analyzing our underlying business performance.

We believe RLTE dollar growth and RLTE per active user are more indicative of our success than take rate when analyzing our performance.

Now let me dive deeper into our revenue performance from a geographic and new products perspective.

From a Send perspective, U.S. revenue grew 25%, driven by continued share gains. Rest of the World grew 31% year-over-year, showcasing the geographic diversification of our business. Our broad footprint means no single corridor disproportionately dictates our outcomes.

Notable highlights from the Rest of the World this quarter include continued strength in the UAE, where we saw a meaningful increase in activity. Send volumes in the UAE rose over 150% year-over-year due in part to a short-term surge in volumes during a period of heightened regional uncertainty.

On the Receive side, revenue from transactions to regions outside of India, the Philippines and Mexico grew faster than the overall revenue growth and now comprise over half of our revenue mix, further diversifying our business.

I'll now move to discuss the performance of our growth accelerators.

As a reminder, growth accelerators include all customer categories and offerings outside of core Send. Now let me dive deeper into a few notable highlights for Q1.

As Sebastian shared earlier, this quarter, we are simplifying our structure for defining customers based on average transaction size. High-value senders are now those who send a transaction of $5,000 or more. This change reflects a refined focus on customers whose needs are specific to larger transaction amounts.

In Q1, high-value senders volume grew 73% year-over-year, reflecting a 220 basis point year-over-year increase in mix. We continue to see outsized growth from high-value senders as we improve the customer experience and expand and refine our targeting of this customer category. And we'll continue to build on this momentum with product enhancements that further reduce friction and cater to the specific needs of these senders. Remitly business continues to scale ahead of expectations.

We ended Q1 with over 20,000 Remitly business users and more than 30% quarter-over-quarter growth in business Send volume. Send volume and RLTE contribution per business customer was more than 2x higher than our core during the quarter. We launched our Receiver product this quarter, enabling direct access to the more than 30 million individuals and businesses who receive funds today from Remitly senders, but are not yet themselves Remitly customers. While nascent, we are very optimistic about this new offering.

Now moving to Borrow, Spend and Save initiatives. Revenue from these offerings more than doubled in Q1. This quarter, we are expanding our Send Now, Pay Later offering, the comprehensive and simpler card-based experience for customers who have a need to Send Now, Pay Later, spend and save. This evolved offering will provide customers with a global debit card, a wallet, a short-term credit line for remittances funded by a banking partner and rewards for timely payments, all for a low monthly plan fee.

As with prior Send Now, Pay Later offerings, this product will be made available only to existing Remitly customers with demonstrated repayment behavior. Unit economics for this product are expected to be strong as it will generate plan and interchange fees and float income. The short-term loans will be issued by a bank partner and the lines of credit tend to perform better than non-recourse advances.

Moving forward, we expect the majority of growth in our Send Now, Pay Later borrowing solution to come from this card-based format. Continue to expect revenues from new products as we previously defined to more than double this year. High-value senders are expected to be additive to prior expected growth ranges associated with new products.

Now including high-value senders, revenue from all growth accelerators is expected to be around 5% of total revenue in 2026 and exceed 10% of total revenue by 2028.

These growth accelerators address customer needs that are adjacent to core senders, providing an efficient means of diversifying our business revenue base, while driving cost synergies from the shared use of our technology.

Turning to our focus on driving profitable growth on Slide 13. As I noted earlier, Revenue Less Transaction Expenses or RLTE, is a useful indicator of our business model's long-term success. RLTE dollars grew 28% to $308 million, outpacing revenue growth and reflecting strong customer activity, improved partner economics, routing optimization and economies of scale. RLTE as a percentage of revenue this quarter was 68%, improving 156 basis points year-over-year.

We remain focused on long-term RLTE dollar growth as we continue to attract new customers, innovate with new products and scale.

Transaction expenses this quarter were $145 million and as a percentage of revenue was 32%. Excluding provisions for transaction losses, other transaction expenses were $124 million, improving 114 basis points year-over-year as a percentage of revenue and reflecting improved network economics.

Provision for transaction losses was $21 million or 9.3 basis points as a percentage of Send volume, better than our expectations as we continue to benefit from efficiencies afforded by the AI-driven fraud prevention and detection model deployed late last year.

With that, let me walk you through the specific non-GAAP expense categories.

Notably, we delivered leverage across all expense categories once again in Q1. In Q1, we reduced our corporate workforce by more than 10% as a part of a broader effort to sharpen our organizational focus and drive efficiencies across the business. These were not easy decisions but were necessary to ensure we continue driving operating efficiencies as we scale our growth accelerators.

Marketing investments remain disciplined and growth focused. We spent $82 million on marketing in Q1, up 20.7% year-over-year. As a percentage of revenue, marketing expense was 18.2%, improving more than 67 basis points year-over-year due to continued efficiencies.

Marketing spend per active customer was $8.56, up 0.7% year-over-year, in line with our expectations. This quarter, we launched a Skip the Line campaign, a strategic initiative targeting off-line senders in the U.S. who historically relied on in-person cash agents to send money to Latin America.

By meeting these customers where they already are, whether on WhatsApp or on billboards in their neighborhoods, we were able to drive meaningful growth in new customer acquisition from a category that is difficult to reach.

Campaign results across our targets show strong lifts in Remitly awareness, consideration and intent to try. Our Lifetime Value to customer acquisition cost ratio was above 6x, while our payback period remained under 12 months. Continued efficiencies reflect growth in customer acquisition through unpaid channels and word of mouth. As a reminder, our marketing investments drive returns for many years beyond our initial investment given our growing base of repeat users.

Customer support and operations expense were $25 million and as a percentage of revenue was 5.5%, improving 69 basis points year-over-year and continuing a multiyear trend of steady operating leverage.

Today, over 97% of transactions are completed without any agent contact, a remarkable milestone that reflects both the reliability of our service and the sophistication of our AI-driven support capabilities.

That customers do need help, our AI-based assistants are meaningfully reducing the need for human intervention, and early customer satisfaction scores tell an encouraging story with AI-led interactions performing as well as human agent interactions.

Technology and development expense was $58 million and as a percentage of revenue was 12.7%, improving by 127 basis points year-over-year. Technology and development expenses grew 14% year-over-year, meaningfully below the pace of our revenue growth. We are beginning to see the benefits from embedding Agentic AI deeply into our engineering and product development teams.

Our engineers are using AI-assisted code generation and automated testing to compress development cycles, ship faster and reduce the cost per feature delivered. We are still in the early innings and expect AI to be a durable contributor to technology-related operating leverage going forward.

G&A expense was $41 million, growing only 2% year-over-year, our lowest growth rate ever as a public company. We delivered significant leverage, 209 basis points as a percentage of revenue year-over-year, reflecting deliberate and disciplined attention to our cost structure.

In total, expense efficiencies this quarter reflect both benefits of operating leverage and a pause in hiring as we optimize our organization to better enable Sebastian's operating principles. Moving forward, we expect AI benefits to contribute significantly to the funding of our growth accelerators.

Strong revenue growth, combined with efficiency and discipline, led to adjusted EBITDA of $102 million. We also delivered $49 million of GAAP net income, more than 300% growth compared to $11 million of net income in the first quarter of 2025.

As we noted at Investor Day, our North Star is driving free cash flow growth while managing dilution and Q1 demonstrated continued progress on both fronts.

Free cash flow grew to over $70 million in Q1. The difference between adjusted EBITDA and free cash flow is explained by working capital, capital expenditure and restructuring payments.

Outstanding shares were 210 million, down quarter-over-quarter for the first time in our company's history, reflecting our disciplined approach to dilution management, including an elevated pace of share repurchase activity.

Stock-based compensation was down 23% year-over-year, coming in at 6.1% of revenue, approximately 382 basis points lower than the first quarter of 2025. This benefit was partially aided by forfeitures associated with headcount reductions in Q1. For all of 2026, we expect stock-based compensation to increase in absolute terms year-over-year, but decrease as a percentage of revenue, as grants associated with recent leadership changes are partially offset by higher forfeitures.

Q2 stock-based compensation will be elevated, reflecting both hiring activity that shifted out of Q1 and challenging year-over-year comparisons, as forfeitures in prior year were concentrated in Q1.

We were meaningfully more active in repurchase of shares in Q1, opportunistically buying back $44 million or 2.8 million shares, nearly double the shares we repurchased since launching the program in the second half of last year. This reflects conviction in our long-term growth opportunities and a view that share repurchases are an attractive use of capital. We'll continue to be disciplined and opportunistic in how we deploy capital towards buybacks.

We ended the quarter with around $650 million of cash. As a reminder, cash and access to liquidity are strategic assets in scale global money movement businesses like ours. This quarter, cash on hand, along with our revolving credit facility were optimally used to fund customer transactions and satisfy regulatory safeguarding requirements across thousands of corridors and regulatory jurisdictions. Our top priority for free cash flow after inorganic investments and customer prefunding requirements remains the repurchase of shares.

With that, I'll move to our outlook.

For the second quarter of 2026, we expect revenue of $483 million to $485 million or 17% to 18% growth. Second quarter growth reflects the shifting in timing of Ramadan and Easter to earlier in the year, elevated U.S. tax refunds benefiting Send volumes in Q1 and increase in volumes late in Q1 associated with geopolitical events and tougher comps.

We continue to see strong momentum in our core, and we expect the continued shift towards digital remittances, share gains and the scaling of our growth accelerators to contribute to total company revenue growth of around 20% in the second half of the year, an increase relative to prior expectations.

Breaking down our revenue growth expectations. In Q2, we anticipate Send volume growth to exceed revenue growth and revenue growth to be in line with quarterly active customer growth. Send volume per active customer is expected to grow in the mid- to high single-digit range, supported by a shift in mix toward high-value senders and businesses.

For the full year, we expect revenue between $1.96 billion and $1.975 billion, reflecting a growth rate of 20% to 21%.

As noted, we expect growth to accelerate in the second half of the year, reflecting strong demand in our core and additional contributions from our growth accelerators.

Now let us pivot to profitability and expense guidance.

Starting with RLTE, we expect Q2 RLTE margins to be modestly higher year-over-year, driven primarily by normalization of transaction losses. As a reminder, Q2 of last year was impacted by an outsized transaction loss stemming from a sophisticated fraud attack in May. For the full year, we expect R LTE margins to be broadly in line with 2025 on a normalized basis.

As always, transaction loss rate may fluctuate quarter-to-quarter, and we remain disciplined about optimizing customer lifetime value while rigorously managing risks across our platform.

Shifting to marketing. We expect continued marketing efficiencies in 2026 as we prioritize high ROI marketing opportunities. For Q2, we expect marketing spend per QAU to be slightly higher year-over-year as we engage customers around the timing of the World Cup, expanding our Skip the line Campaign to select countries and launch brand marketing in the UAE.

Putting this all together, we expect Q2 adjusted EBITDA to be between $86 million and $88 million, translating to an adjusted EBITDA margin around 18%, an expansion of around 250 basis points year-over-year.

For the full year, we expect adjusted EBITDA to be between $370 million and $385 million, representing an adjusted EBITDA margin of around 19%, also an expansion of around 250 basis points year-over-year.

This improved EBITDA outlook reflects a more favorable outlook of revenue and our commitment and ability to balance growth and profitability, leveraging the benefits of AI as we continue to invest in driving top line growth.

Our outlook also assumes normal levels of transaction losses for the remainder of the year. We expect to generate positive GAAP net income each quarter this year and strong year-over-year growth in GAAP net income and free cash flows.

To summarize, in Q1, we delivered another quarter of exceptional results across our key financial metrics, achieving 25% revenue growth and 22% adjusted EBITDA margins. We also delivered record GAAP profitability and strong free cash flow, underscoring the power and scalability of our business model.

With that, Sebastian and I will open up the call for your questions. Operator?

[Operator Instructions] Our first question comes from the line of Tien-Tsin Huang with JPMorgan.

Nice results here. I want to, if you don't mind, Vikas, I know you went through this in the guidance, but maybe can you drill down a little bit more in the upside factors in the quarter, the thinking for the second quarter and the balance of the year. There's a lot of moving pieces with the tax refunds being higher and the remittance tax, and you talked about some of the geopolitical favorable market conditions and whatnot. So how does this impact your thinking on seasonal trends for the second quarter and second half? What new risk might there be here versus upside opportunity that may have been different than, say, 90 days ago?

Tien-Tsin, first of all, thank you for the question. And as I shared on the call, Q1 was an exceptional quarter, really strong highlights across the board, all the way from record new customer acquisition to record Spend per quarterly active users.

Some of the highlights in the quarter included just the positive impact that we got from remittance tax and the shift from offline to online customers that aided our record new customer acquisitions. In addition to that, the higher U.S. tax refunds as we have seen, especially in the core sender segment, this is a really positive impact that we saw.

Again, a lot of it is art and science, but clearly, there was some correlation there, especially in the late March time frame. Beyond that, as we highlighted, holiday timing, both Easter as well as Ramadan moved up a couple of weeks earlier in the year, which gave us a positive overall Q1 shape.

Finally, as we noted, the global uncertainty with regards to geopolitics, especially in the Middle East corridors, created an upside on the UAE volumes, which grew north of 150%. So overall, really strong quarter. And as you know, Q1 becomes the foundation for full year. And with the record new customer acquisition, that creates a nice follow-through in out quarters.

As we highlighted, the full year guidance is north of 20%, which means that in the second half of the year, there is a reacceleration that happens. And especially this is driven by both the strength in our core business as well as propelled by the growth accelerators Sebastian talked about.

So overall, we remain very confident as we start the year. And just the overall business model that we have, which drives predictability, resilience as well as diversification gives us more and more confidence.

Our next question comes from the line of Ramsey El-Assal with Cantor Fitzgerald.

I wanted to ask about your M&A approach. It seems like in the last several quarters, the kind of growth vectors in your business have just exploded just in terms of product proliferation, monetizable services. Is that changing the way you're looking at M&A to have so many more opportunities to sort of accelerate these different growth paths through M&A?

And then also, if you could just clarify one point, Vikas, on Tien-Tsin's last question. How should we think about that 1% cash remittance tax impact, which has been positive trending through the rest of the year? Is it something that you guys are counting on? Or is it something that you're seeing now? Are you're not sure you'll continue to see? Just a finer point on that, too.

Yes. So let me take the acquisition question. Clearly, as we see all the growth in these new customer categories, the high-value senders, the business senders, and the receivers, the volume, we are starting to analyze acquisitions a little bit different. As you know, we have not been a very acquisitive company. We don't, we are starting the process to understand what does it mean to have this kind of growth in these categories and where can we accelerate that.

On the core business, I don't, as of right now, standing here today, I don't see anything obvious on the horizon. But I do, but we are, we're building up the muscle to learn how to do this, and I anticipate that sometime in the future, we will probably be able to answer this question more specifically. On the 1%, we don't have any science behind the 1%. We've got a lot of anecdotes, and we saw this in Q1, I suspect it's probably going to continue for the remainder of the year. It's hard to tell whether we captured a lot of it now or a lot of it is coming. There still is a fairly large group of people that transact in cash. I think it's inevitable that this will continue. Maybe it will take a couple of years, maybe it will take the remainder of this year.

But as I said, we take it as an article of faith that it was one of the tailwinds to our business, and we expect it to continue for the rest of the year.

And just to add a point or two to Sebastian's thoughts. We'll continue to invest in the Skip the line campaign. We have seen a lot of success coming through that. And secondly, the product enhancements, we want to meet where the customers are. As we shared earlier in the quarter, we came out with enhancements to WhatsApp. We launched a ChatGPT integration. So we feel that by creating strong product enhancements, we can continue to drive the offline to online shift.

Our next question comes from the line of Darrin Peller with Wolfe Research.

Look, I want to back out, if we take out of the equation, the, let's call it, the remittance tax, the Mid East impact or the, even tax refunds, just anything that might be shorter term and not a business model opportunity for you guys. When I think of the sustainable drivers of upside, the growth accelerators effectively, help us understand where they came in versus your prior expectations.

I mean if you looked at high-value senders or business or receivers or even some of the borrow on Spend and Save areas, I'm curious to know where they're trending versus what you initially thought. And then maybe a little more on go-to-market around high-value senders and business just because it seems like such a great, I mean, it's really contributing to the volume growth rate. And I know it's an area of real focus for you guys. So I'm curious where you see that going from here in terms of your ability to invest in it and ensure that it stays a key contributor.

Yes. So I'll make the comment that, first of all, these are not segments that we invented. As we looked at all the data and we looked at the customers coming to Remitly, we started to see this high value greater than $5,000 transactions, $10,000, $50,000. And so it was customers finding us and starting to use the platform. And so we've done, this is not, we have a lot of ideas to make the product that much better. So without much investment we've started, we see a lot of growth in this area, and it's overachieved all our plans so far.

As of right now, we've now dedicated a full team. We have a full engineering team. So we're launching new features for that customer daily at this point. The business, the same thing happened. We started to see small businesses using the Remitly infrastructure. As you know, if you're a small business in the U.S., it's very painful to move money across the world. And so we've done the same thing. That business continues to overachieve our plans. We've now dedicated a team. We have a full engineering team. We have a new, that's a different go-to-market model. We have more partnerships.

So we are also seeing week-to-week improvements. And as you know, that's a very large market. We don't, you don't need to be, you don't need to win that much to make it a pretty big business.

I was in Manila last week, and I was talking to a group of freelancers, and this is a very active group of people who are requesting money to be paid from the U.S. the virtual assistants, virtual salespeople, and this is happening all over the world. So we see a lot of traction there. And then the final category is a little bit more unknown.

That's these 30 million customers around the world who receive money from Remitly. We've launched our first set of products. It's very early days. I don't, that's not contributing much yet. We think it's a big opportunity, but that we have to navigate our way through that, see what the right products are. So overachievement in high-value senders, and we're doubling down on that, overachievement on the business side, and we're doubling down with that. And on the receiver side, seems a very exciting market, TBD.

Our next question comes from the line of Cris Kennedy with William Blair.

Just wanted to follow up on the Remitly, the business initiative. Clearly, it's outperforming your expectations. But is there any way to frame kind of how that business is ramping relative to the high-value send initiative that was launched maybe 18 months ago?

Yes. I think from; the high-value sender is an extension of our core sender market. So if you look at the product needs of that sender, it's a close cousin to all the needs of the core sender. The business sender is different, has different requirements. They need bulk send, they need different integrations to their ERPs and payment systems. So it's a bit of a different customer. So the, it's a little bit of an unfair comparison because the go-to-market is going to be different.

And we've seen the overachievement without much go-to-market investment yet. And so I'd say that if you were to look at the numbers, it's probably pretty, it's a pretty similar ramp of growth between the high-value senders and the business senders, but quite different potential as to what we need to do to continue to accelerate that growth.

Our next question comes from the line of Aditya Buddhavarapu.

Could you just give an update on the rollout of the wallet and card? The U.S. was, of course, the first market, but any update on maybe the rollout into other markets during 2026? And also maybe somewhat related to that, the rationale behind focusing on the card as the main channel for Send Now, Pay Later product. What did you see which made you take that route?

Yes. Well, first, I'll start by for the last year, we've been experimenting with this Send Now, Pay Later idea, which is a short-term liquidity loan and we've had a very, very strong signal. So we, this is a killer idea, we think. And we're going to, customers have told us that the use of a card is extremely valuable. So we're wrapping up a number of ideas under this card construct, which obviously are going to help the economics and allows us to really simplify how we go to market with this.

Remember that the Send Now, Pay Later is an invite only. The customer already sent once on Remitly. We know some stuff. So we think it's a very interesting product. The signals of all the testing over the last year are very good. And so we see that launch as quite a lot of potential. We've obviously got a long list of things that we're going to add to a card to make it, to make customers use it and loyalty, and you can imagine all the things that we can add to a card.

It is U.S.-focused first. We're doing it with a bank partnership. But our ambition is to make this global. But as of right now, we're going to go for the next few quarters with a U.S. launch only.

Our next question comes from the line of David Scharf with Citizens Capital Markets.

This is Zach on for David. Congratulations on another strong quarter. I wanted to dig in a little bit on the mix with the high-value senders. So obviously, as it's ramping up, it sounds like over 10% of revenue by 2028. I want to see if there's any kind of commentary or anything to kind of highlight in terms of how that shift will impact any kind of geographic mix or concentration or any expectations for loss rates versus the kind of core senders book?

Yes. Thank you for the question. As we highlighted, we're very excited about the high-value senders customer category. And as we highlighted, this used to be part of just our core Send, but we are increasing our focus putting a dedicated organizational structure and muscle behind it, putting a product thought process as well as marketing focus around it. And as we do that, we see the potential is massive, right?

So we're super excited for the potential here. Even as we do that, in parallel, we are seeing very strong performance. As you saw this quarter, the high-value senders volume grew 73%. And as we look at a lot of product enhancements, increasing our Send limits, we feel that the volume, especially on the, call it, 10,000 plus, 25,000 plus, 50,000 plus, a lot of those are really big greenfield opportunities for us where we can start attracting more and more customers.

If you even think about our marketing message, that is more generic. And as we try to make it more targeted and focused towards these customers, we feel the awareness as well as the overall service that we provide should resonate really well. So very excited about it. The availability is across the globe, same as what our core sender availability is. So from a mix, from targeting the customers, we believe that it should be a global adoption and global growth, and that makes it even more exciting for us.

Our next question and final question comes from the line of Zheqian Deng with KeyBanc Capital Markets.

This is Zheqian on behalf of Alex Markgraff. And I was wondering if you could provide more context on Remitly in ChatGPT, any financial consideration in it? And also a question on WhatsApp expansion. How can we assume Remitly to expand on this? Obviously, there's more geo coverage, but seems there's also an opportunity on the Receive side partnership as well.

Yes. Thank you. Good question. So no financial interchange with ChatGPT. These are early days. We're clearly entering a time where customers are probably going to interface with all their financial services with different interfaces and be it WhatsApp and WeChat and ChatGPT, all the LLMs and the chats and eventually agents also. So we're, we have a lot of experiments going on.

We've announced the WhatsApp integration, which allows customers to interact directly with Remitly through WhatsApp. ChatGPT is an early experiment. We see some use there, and it's growing day by day. I follow that every day. And we have a long list of ideas to make sure that all the Remitly infrastructure and all the benefits of the cost efficiencies, the speed and the service behind moving money is available and relevant if these evolutions in how people interface with money movement changes.

So early days, good signals so far, and we'll keep you posted on what the next set of ideas are.

Thank you. This concludes the question-and-answer session. Thank you for participating in today's conference. This concludes the program. You may now disconnect.

Good day, and thank you for standing by. Welcome to the Remitly Fourth Quarter and Full Year 2025 Earnings Conference Call.

[Operator Instructions]

Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, David Beckel, Vice President of Investor Relations. Please go ahead.

Good afternoon, and thank you for joining us for Remitly's Fourth Quarter and Full Year 2025 Earnings Call. Joining me on the call today are Matt Oppenheimer, Co-Founder and Chief Executive Officer of Remitly; Sebastian Gunningham, incoming CEO of Remitly; Vikas Mehta, Chief Financial Officer. Results and additional management commentary are available in the earnings release and presentation slides, which can be found at ir.remitly.com. Please note that this call will be simultaneously webcast on the Investor Relations website. Before we start, I would like to remind you that we will be making forward-looking statements within the meaning of the federal securities laws, including, but not limited to, statements regarding Remitly's future financial results and management's expectations and plans. These statements are neither promises nor guarantees and involve risks and uncertainties that may cause actual results to vary materially from those presented here.

You should not place undue reliance on any forward-looking statements. Please refer to the earnings release and SEC filings for more information regarding the risk factors that may affect results. Any forward-looking statements made in this conference call, including responses to your questions, are based on current expectations as of today, and Remitly assumes no obligation to update or revise them, whether as a result of new developments or otherwise, except as required by law.

The following presentation contains non-GAAP financial measures. We will reference non-GAAP operating expenses, adjusted EBITDA and free cash flow in this call. These metrics exclude items such as stock-based compensation, payroll taxes related to stock-based compensation, pledge 1% contribution, integration, restructuring and other costs and other income and expense. For a reconciliation of non-GAAP financial measures to the most directly comparable GAAP metric, please see the earnings press release and the appendix to the earnings presentation, which are available on the IR section of our website.

Now I will turn the call over to Matt to begin.

Thank you, Dave, and thank you, everyone, for joining us today for our fourth quarter earnings call. Today's call is an important and especially exciting one for me as we announced the appointment of and welcome Sebastian Gunningham ham as Remitly's new CEO. He could have not [indiscernible] to joining Remitly any better. We ended this strategically important year with incredible results, growing revenue by 29% and reaching adjusted EBITDA of $272 million in 2025, exceeding our guidance for both. This very strong finish to the year, and our outlook for next year reflects the strength of our product platform, team and strategy and is the result of 15 years of hard work guided by a simple vision that sending money and receiving money across borders should be reliable, fast and fair.

Prior to founding Remitly, I lived and worked on 3 continents and saw how painful and uncertain basic financial flows could be for people who move money across borders. That experience was the seed for our now broader vision, transform lives with trusted financial services that transcend orders. I'm reminded of the importance of that vision every time I connect with customers like [indiscernible], a customer since 2019, who joined Remitly through word of mouth during graduate school. She used Remitly initially to support her parents. Since then, she has lived in multiple countries sending larger and larger amounts over time and recently used Remitly to transfer $60,000 in 1 transaction to meet tax obligations.

She is what we call a high amount sender, a customer category that grew send volumes more than 40% year-over-year in 2025. She says she prefers Remitly relative to banks and other competitors because of our competitive exchange rate and the speed of transfers.

That vision, our unrelenting commitment to delivering positive and trusted customer outcomes and the power of our scale platform have resulted in substantial growth over the years. Since just 2020, quarterly active users have grown by nearly 5x and revenue has expanded more than sixfold. I'd like you to think about that for a moment. Just 5 years ago, Remitly was around $250 million in revenue, serving close to 2 million customers. We are now over $1.6 billion in revenue, serving more than 9 million customers. That momentum in our core money movement business continues. And with less than 4% share of the consumer TAM alone, there is significant headroom to expand further. Beyond money movement, our portfolio of new products provides an opportunity to grow and diversify revenue by creating stronger relationships with customers we serve.

In my comments, I will share 3 key updates: First, I will reflect on our achievements in 2025; second, I'll share how this past year's accomplishments inform our strategic priorities for 2026; and finally, I will provide additional color on my decision to transition to the Chairman role, how I will stay engaged in that capacity and explain why Sebastian is the right leader for the company going forward. I will then turn the call over to Sebastian to more formally introduce himself.

Starting with the reflection on the past year. 2025 put simply was a phenomenal year for Remitly. Strategically and financially, it was one of the most pivotal years in Remitly's history, culminating in an Investor Day and the issuance of our medium-term outlook in which we expect to generate up to $3 billion of revenue and $600 million of adjusted EBITDA by 2028. Equally importantly, it created the right moment to accelerate execution with a new leader. Our exceptional performance in 2025 was underpinned by 3 things. First, strength in our core money movement product; second, early contributions from new products, which enable our long-term vision of becoming a leading and trusted provider of financial services that transcend borders; and third, efficiency gains and operating leverage, which drove record levels of adjusted EBITDA, GAAP profit and free cash flow.

Starting with core money movement. 2025 marked another year of rapid customer growth. We ended the year with more than 9 million quarterly active users close to $75 billion of annual spend volume and more than $1.6 billion of revenue, growth of 29% year-over-year continuing our track record of significant share gains amid one of the more challenging political and macroeconomic environments in recent memories. This growth was driven by an expansion of our reach with new customer categories like high amount senders. The strength of our platform, which allowed us to test, iterate, gather market intelligence and leverage learnings faster than ever and our continued focus on improving the customer experience.

Our relentless attention to trust, reliability, speed and simplicity and delay drove further increases in retention rates and customer lifetime value. Our platform also enables meaningful progress in the launch and adoption of new products. This past year, we launched our send now, pay later product, Flex. Flex is our first product outside of global money movement to surpass 100,000 users, reflecting its strong appeal with a large portion of our customers and it bridges timing mismatches between earnings and the transfer needs among our customer population.

We ended the year with around 120,000 total Flex users and saw solid double-digit quarter-on-quarter growth in users each quarter throughout the year. We also launched a product focused on businesses, Remitly Business, a global money movement product that allows small- and medium-sized businesses to pay international contractors, vendors and employees. The focus for Remitly Business this past year was on developing and testing features that appeal first to micro businesses while at the same time, managing a product road map that enables us to scale quickly to address the roughly $20 trillion global money movement opportunity for small and medium-sized business customers.

Early traction for Remitly Business is strong as we ended the year with more than 15,000 business customers on the platform. The third major new product launch last year was our membership program, Remitly One, which ties all our new product offerings, liquidity, wallet and card into a unified experience that rewards engagement and build daily habits. Early adopters have shown strong demand for the Send Now, Pay Later feature as we continue to extend the availability and features of our wallet and card and refine other rewards and benefits.

In 2025, we also delivered record levels of efficiency, profitability and cash generation, significantly outperforming our expectations. Just 1 year ago, the business had a negative net income of $37 million and today has net income of $68 million, with $41 million of that coming in the fourth quarter alone. Momentum and profitability is being driven by several reinforcing forces. First, AI-enabled operating enhancements are fundamentally improving both efficiency and velocity. For example, a recently upgraded fraud model, leveraging AI and integrated data across our platform helped drive record low transaction losses as a percentage of send volume and lower side line rates in Q4, contributing roughly $10 million of incremental [indiscernible] dollars versus our forecast.

And in product development, we have reduced developer time for product enhancements by combining processes that involve many data sources and human judgments into agent automated workflows, bringing up developer and engineering time for more strategic higher-impact projects. Second, scale continues to strengthen our flywheel, driving improved unit economics across transaction expenses and other major expense categories. Third, optimization and treasury operations aided by AI models and stablecoin have driven continuous improvements to our FX costs. These factors, together with a disciplined approach to hiring, contributing to an expansion of adjusted EBITDA margin of more than 500 basis points year-over-year, enabled full year GAAP profitability for the first time in our history and drove a tripling of free cash flow. We will carry this momentum from 2025 into 2026 as we progress towards the 3-year financial goals we laid out at Investor Day of up to $3 billion in revenue and $600 million in adjusted EBITDA.

Slide 6 presented at our Investor Day, is the strategic blueprint we will use to drive improvements in our platform and products while ensuring we remain laser-focused on meeting the most critical cross-border financial needs of a growing group of customer categories. I'll touch on key priorities for each.

Starting with our platform. At Remitly, we see AI as a tremendous tailwind for improving our platform and an enabler of our strategic and financial goals. In 2026, we will further expand the use of agentic and AI systems company-wide to amplify productivity, streamline operations, lower fraud risk, improve customer satisfaction and speed product development and decision-making. We will expand our use of stablecoins by enabling broader assets to USDC and further embedding stablecoin and treasury operations to generate incremental working capital efficiencies and lower transaction costs.

Moving to products and specifically, our new products, credit liquidity, wallet, membership and our money movement products targeting businesses. In 2026, we will continue to test and optimize while moving to a full scale launch for a number of our new products in key geographies. We expect in total to more than double revenue from new products this year. Vikas will provide more detail about specific growth initiatives for the upcoming year in his commentary.

Finally, I'll discuss our priorities for growing the customer categories we outlined at Investor Day. In 2026, we will continue to expand our presence of the high amount senders or those that send more than $1,000 per transaction, a large, important and underserved customer category. Our unit economics optimized for lower transaction amount give us a huge competitive advantage as we extend to higher send threshold. In 2025, we saw volumes from high amount senders grow 15 percentage points faster than low amount senders, and we expect another year of strong growth in high amount send volumes as we further extend send limits. 2026 is also expected to be an important year for geographical expansion. We continue to scale in the UAE, launched outbound service in Japan early in Q1 and plan to enable sending from the Kingdom of Saudi Arabia and potentially in Brazil, subject to regulatory approvals.

I could not be more excited about Remitly's prospects in 2026 and beyond. Our growth today reflects the cumulative benefit of core strength developed over the last 15 years. Trust, a proprietary global money movement network and the compounding advantages of scale. We built a digital-first platform that dramatically lowered the cost and friction of cross-border transfers, helping to significantly reduce the industry cost of [indiscernible] transfer and saving customers billions of dollars as a result.

We turned a largely cash-based, slow remittance process into a near instant experience from millions of people, resulting in real tangible improvements in people less. Looking ahead, the work to drive positive business outcomes and the achievement of our medium-term financial targets is clear and interdependent. We will further accelerate product velocity, so we can convert product proofs in a broad adoption. We will continue to institutionalize operational excellence with tighter cadences, repeatable playbooks and a relentless focus on execution quality. We will manage costs thoughtfully and we have done it by strategically reducing head count and reallocating resources to high-impact growth areas. And we will treat AI as a structural lever, using models to speed product delivery, improve underwriting and risk controls, reduce fraud risk, automate audit and compliance and make marketing measurably more effective.

Doing these things together at scale and with continued focus on capital discipline is what moves us from a global payments company to a company that offers a wider range of financial services that transcends orders, one capable of transforming lives for individuals and businesses with cross-border financial services needs. And with the foundation and plans in place, I am excited to hand the reins over to a new leader who will dramatically accelerate the delivery of new products and the realization of our vision.

The transition has been and will continue to be done with a lot of intentionality. I went to the Board a while back to start discussing the succession planning. I didn't know if it would take a quarter or several years to find my successor, but I had the conviction that now was the time to find an incredible successor. The company is doing exceptionally well. The vision is clear and with the right leader, we can meaningfully accelerate delivery while I continue as Chairman. The Board and I ran a deliberate exhausting process to identify that leader, defining a success profile, completing thorough interviews and running independent pre-hire diligence and assessment. Sebastian Gunningham emerged as the leader, who is an exceptional fit for what we need in our next phase. Originally from Argentina and with extensive professional experience in Latin America, he perceived better than most, the need for timely and reliable cross-border payment solutions and a stable currency. He also has great exposure to founder-led companies and cultures at the most senior levels, reporting directly to Larry Ellison at Oracle and Jeff Bezos at Amazon.

With this experience, he brings a rare combination of product rigor and operational discipline. He grew Amazon's Marketplace business to a multi-hundred billion GMV business and he's led growth companies as CEO at various stages. Finally, he has broad experience in financial services, running Amazon payments during his tenure at Amazon and more recently Chair of Santander Consumer Finance. Simply put, he is uniquely suited for Remitly as a product-led technology executive and strong operator with incredibly unique experience at both very large and growth-stage technology and financial services companies.

As I have gotten to know Sebastian, it became clear that he is exactly what Remitly needs right now. and I am so excited for you to know him going forward. I will remain an active adviser for Sebastian and the Chairman of Remitly. My top priority is to work with Sebastian on an organized and thoughtful transition as he ramps up as CEO in the coming months. Sebastian and I are highly complementary. He will relentlessly drive product velocity and operational cadence. I will provide a founder's perspective, support strategic external relationships and ensure continuity of our long-term vision. We will operate in a tight partnership. On a personal note, I think this more is stepping up and stepping away. I will continue to be the largest individual shareholder with no plans to sell for the foreseeable future and I will remain deeply engaged as Chairman, not as an operator of the business where I will defer to Sebastian.

I also plan to devote more time to systematic problems where Remitly's experience and scale could help. For example, remittance policy that supports safe digital adoption and regional work and fast-changing sending hubs like the Middle East, where an onshore presence, policy engagement and other macro issues are important to our customers.

These are longer-term cross-industry initiatives that I will pursue from a strategic vantage point and where our platform and AI capabilities provide practical levers to effect change. Let me close by reaffirming the one sentence that guides everything we do and that remains unchanged, transform live with trusted financial services, that transcend borders, that is the North Star for every product decision and every operational choice.

The platform, products and the team are now in place to deliver that ambition at a much larger scale. The work ahead is to increase velocity and execution quality, so more customers benefit faster. With that, I will now hand it over to Sebastian for a short introduction.

Thank you, Matt. First, I want to congratulate Matt and the entire Remitly team on an exceptional 2025, ending the year with 29% revenue growth from $272 million in adjusted EBITDA is a testament to the strength of the platform we've built over the last 15 years. It's a privilege to join a company executing with such consistency and discipline of results. Second, I've been asked what attracted me to Remitly. The answer is a combination of mission, opportunity and time. Let me start with the mission. Remitly serves a global community that has been historically underserved and overcharged. After getting to know Matt, it became clear that this mission is an authentic reflection of the [indiscernible]. This makes the work of serving this community meaningful, and it makes the impact were.

Next, the opportunity. Global remittances is a monster category with room for multiple strong players. Remitly has around 4% of the Consumer Payments segment alone. There is plenty of space for growth as money movement around the world is only going to get bigger and more important. Then the product. Customers love the Remitly product, high trust and repeat usage proved that Remitly is a product value story. That trust built across more than 5,300 global corridors is a moat that doesn't reset overnight. The unit economics also work, as you are seeing in these latest results, this is a business with scale advantages that will continue to accrue into the future.

And finally, timing. AI is a big tailwind for this business. For me, personally, the timing is very good. I have a data and science background and have been deep in the evolution of real. I believe AI will be transformative and I also believe incumbents with established business models and happy customers are going to be huge beneficiaries of AI. I'm going to aggressively lead that journey at Remitly.

Putting all these points together, it became a very compelling reason to say yes, to leading Remitly. I've also been asked how I would brand myself as I step into this role. My career has been defined by building and launching products at some of the best companies in the world, leading large-scale engineering and business teams and operating within complex organizations. I have also spent the last 5 years working deep in banking and payments. Paired with my data science background and deeply attuned to the way AI is transforming the space. I'm a product-first operator, someone who believes in combining rigorous operational discipline with the speed of technological innovation.

Let me close with this reflection. Remitly operates in a fast-growing ever-evolving and over $22 trillion annual cap. In this environment, in my opinion, there is only 1 durable advantage that matters, build the best product. In digital financial services, the product is the business. That will be my focus and the way we keep growing our customer base, delivering a great service and driving our revenue growth. I look forward to interacting with all our analysts and shareholders and to working closely with Matt and the Board to deliver on the ambitious long-term vision we have laid out for Remitly.

Thank you so much, Sebastian. I am so incredibly excited that you are here. You're focused on building the best product combined with disciplined execution is going to result in really exciting results for our company and customers and it reinforces the strategy we laid out at Investor Day and strengthens our confidence in delivering on our ambition of $3 billion in revenue and $600 million in adjusted EBITDA by 2028. With that, I'll now turn the call over to Vikas to walk through our financial and operating highlights for the quarter.

Matt, thank you for your leadership. Sebastian, welcome to Remitly. Good afternoon, everyone. As we shared at Investor Day, we are focused on profitable growth, strong free cash flow and manage dilution to drive long-term shareholder value. Q4 and full year results clearly demonstrated our ability to do that. We delivered a pretty strong quarter and full year with record revenue and adjusted EBITDA. Fourth quarter was $442 million revenue, up 26% year-over-year. Adjusted EBITDA was $89 million resulting in an adjusted EBITDA margin of 20%, our highest quarterly adjusted EBITDA margin ever. Our performance this quarter was driven by key primary factors: the revenue growth aided by a strong December holiday period with efficiently managed marketing spend, lower-than-expected transaction losses, reflecting the benefits of a new AI-driven fraud reduction and prevention model and rigorous management of operating expenses.

For the full year, we once again delivered profitable growth. Revenue was $1.635 billion, up 29% and adjusted EBITDA was $272 million, resulting in an adjusted EBITDA margin of nearly 17%, an increase of more than 500 basis points year-over-year, as you can see on Slide 12. Importantly, we delivered our first full year of GAAP profitability with $68 million of net income. We delivered these results by carefully managing both top line and bottom line throughout the year with revenue ending up more than $60 million above and adjusted EBITDA more than $80 million above the midpoint of our initial 2025 guidance.

I'll begin with an overview of our fourth quarter results and then share our outlook for the full year and first quarter of 2026. Let me first unpack revenue growth drivers for Q4. Send volume grew 35% to $21 billion, consistent with the prior quarter's pace, supporting the strong volume growth, send volume per active customer increased to over $2,200, a 13% year-over-year growth to reach its highest level, both on an absolute and percentage growth basis. This was driven by growth in both transactions per active customer and record growth in average transaction size, as we continue to win share and gain traction with high amount senders and business customers. Quarterly active customers increased 19% year-over-year to nearly 9.3 million, in line with expectations.

Our retention remains strong, reflecting the benefits of investments in the core product to improve speed, reliability and the overall customer experience. As expected, volume and revenue exceeded QAU growth as we saw a greater mix of volume from high amount senders. Before I dive into our performance, let me define our 3 customer tiers by send volume. Low amount senders are those that stand under $1,000 per transaction. High amount senders are customers that spend between $1,000 and $10,000 per transaction and very high amount senders are customers that send over $10,000 per transaction.

In Q4, we saw a continued shift in mix towards volumes from higher amount senders and very high amount senders. High amount sender volume grew 40% year-over-year and very high amount sender volume grew 105% year-over-year as shown on Slide 14. Growth in volume from high amount senders and very high amount senders accelerated in Q4, increasing our mix of send volume from these years by over 350 basis points year-over-year. These 2 customer tiers are a strategic focus for us. And as we noted at Investor Day, now they comprise nearly 50% of send volume. This quarter, our take rate was 2.13%, in line with expectations. Growth in volumes from high amount senders was one of the main contributors to year-over-year changes in take rate, both for the quarter and the fiscal year. Since take rate is heavily influenced by mix, it is not a great metric for analyzing our underlying business performance. We believe that [indiscernible] dollar growth or RLD for active customers, which highlights shortly are more indicative of results than take rate for analyzing our performance.

Now let me dive deeper into our revenue performance from geographic and new product perspective. From a send perspective, U.S. revenue grew 28%, driven by continued share gains. [indiscernible] revenue grew 26% year-over-year, accelerating sequentially and showcasing the geographic diversification of our business. Notably, in Q4, we saw strong adoption of our product in UAE with more than 150% quarter-over-quarter growth in new customers. On the receive side, revenue from transactions to regions outside of India, the Philippines and Mexico grew faster than overall revenue growth and now comprises over half of our revenue mix. Before moving to a review of profitability, I'll discuss progress means with new product areas, focusing on Remitly business, Send Now, Pay Later, wallet and card and our membership program. As Matt noted, we are seeing strong indications of product market fit for each. Our goal over the next 3 years is to scale these products to drive adoption within our existing customer base and leverage new products as a means of attracting first-time users to the Remitly platform.

As noted at our Investor Day, we expect these new products to contribute 5% to 10% of total revenue by 2028. In 2025, new products contributed a little more than 1% to our revenue, and we expect new product revenue contribution to more than double in 2026. Revenue from new products include flat Remitly business, Wallet and Card and Remitly One. With that overview, let me share a few highlights as it pertains to our new products. Starting with Remitly Business. Remitly Business is our global money movement product tailored to the 80 million small and medium businesses with cross-border financial needs. Remitly business addresses an opportunity more than 10x the size of our core consumer payments business. As Matt noted, our early focus with this product has been micro businesses. This subcomponent of the $20 trillion business TAM wants a low friction repeatable payment workflow that can be easily integrated into the system, small businesses use all with the same level of trust our core consumers enjoy. We have seen strong traction for Remitly Business in the 6 months it has been offered with over 15,000 businesses on the platform as its transaction sizes for business customers are roughly twice those of our core customer category. Remitly Business is currently available to businesses in the U.S., Canada and the U.K. with plans to expand in the EU in 2026.

In 2026, we also plan to add features that appeal to larger businesses with more advanced cross-border payment needs like recurring and bundled payments. Moving on to Send Now, Pay Later. We continue to see strong product market fit for Flex with active users reaching around 120,000 and revenue nearly doubling sequentially in Q4. Unit economics for Flex in Q4 are encouraging and in line with expectations. Our data reviews that Flex customers spend more than non-Flex members and loss rates are trending in line with expectations. In 2026, we leverage key learnings from early cohorts to continue to expand.

As we have shared at Investor Day, this spring, we will also launch Remitly Credit, a recourse line of credit that will offer customers access to higher mutate and provide customers a means of establishing a credit history. Finally, wallet and card are foundational elements offer a broader financial services offering and are expected to be a key enabler of the adoption and utility for over new products, allowing customers and businesses to store, save and spend money. We are seeing encouraging early traction with over 60,000 wallets created to date despite a controlled product rollout. Flex Advance, Wallet and Card and upcoming Remitly Credit comprise the core set of features for Remitly One, our flagship membership product. While members have shown a strong interest in flat benefits, we expect to unlock Wallet and cards global availability, launched radically car credit and grow other benefits and rewards as we expand penetration of Remitly One among our customer base throughout 2026.

Turning to our focus on driving profitable growth on Slide 16. As I noted earlier, the Revenue Less Transaction Expenses, or RLTE, is a useful indicator of our business model's long-term success. RLTE dollars grew 30% to $305 million reflecting strong customer activity, improved partner economics, routing optimization and economics of scale. RLTE as a percentage of revenue this quarter was 69%, a record high, improving 252 basis points year-over-year. We remain focused on long-term RLTE dollar growth as we continue to attract new customers, innovate with new use cases and scale.

Transaction expenses this quarter were $138 million and as a percentage of revenue was 31%, excluding provision for transaction losses other transaction expenses were $123 million, improving 200 basis points year-over-year as a percentage of revenue as we continue to benefit from the improved network economics. The mix of digital received transactions increased year-over-year by more than 300 basis points, continuing a trend that has been positive for our business and customers.

Provision for transaction losses was $15 million or 7.3 basis points as a percentage of send volume, a record low and better than our expectations. As noted, improved performance this quarter is due in part to a recently deployed AI-driven fraud prevention and detection model. With that, let me walk you through the specific non-GAAP expense categories. Notably, we delivered leverage across all expense categories in Q4. Marketing investments remain disciplined and growth focused. We spent $88 million on marketing in Q4, up 11.5% year-over-year.

As a percentage of revenue, marketing expense was [ 19.9% ], improving more than 250 basis points year-over-year. Marketing spend per active customer was $9.49, down 6.5% year-over-year. This outcome was driven by a more focused and intentional approach to invest in customer acquisition around peak holiday period aided by ongoing implementality testing, which allows us to more efficiently meet our targets by optimizing spend across geographies. We were able to deliver these marketing efficiencies while supporting growth in higher on standards and business customers. Notable campaigns in Q4 included a focus in the U.S. on capturing and driving offline to online conversion through our WhatsApp send, product and campaign featuring awareness of the 1% remittance tax on cash remittances. Our lifetime value to customer acquisition cost ratio was about 6x, while our payback period remained under 12 months.

As a reminder, our marketing investments drive returns for many years beyond our initial investment, given our growing days of repeat users. Customer support and operations expense was $27 million and as a percentage of revenue was 6.1%, improving 12 basis points year-over-year and continuing a trend that we have seen over the past couple of years. AI-based assistants are driving lower agent contact rates with early customer satisfaction scores, indicating AI-led interactions can perform as well or better than human agents.

Technology and development expense was $56 million, and as a percentage of revenue was 12.7%, improving by 83 basis points year-over-year. Technology and development expense grew 18% year-over-year, reflecting our ability to more efficiently manage technology spend while delivering robust product innovation, across product and engineering, agentic AI is accelerating development velocity support generation and testing, enabling rapid design markups, enhancing customer service supporting transaction completion, streamlining document verification and powering the install language gearing.

In Q4, we further increased our leading metrics across [indiscernible] and reliability. Over 65% of transactions were dispersed in under 20 seconds, increasing 7 points in Q3. More than 97% of transactions were completed without customer support contact and our platform delivered 99.9% of time. G&A expense was $45 million, an improvement of 130 basis points as a percentage of revenue year-over-year, reflecting continued leverage across the business. Overall, we continue to maintain rigorous discipline on hiring and non-headcount spend while investing in compliance, geographic expansion and AI tools.

As Matt noted, we are investing in AI across the organization with AI, now an important element of performance objectives comp-wise. We expect to generate operational efficiencies and top line benefits from these investments through increased productivity and more targeted efficient customer acquisition. Strong revenue growth combined with efficiency and discipline led to record adjusted EBITDA of $89 million. We also delivered a record GAAP net income quarter to $41 million of GAAP net income, a significant improvement compared to a $6 million net loss in the fourth quarter of 2024.

As we noted at the Investor Day, we're not [indiscernible] is to drive free cash flow while managing dilution. 2025 showcases our ability to drive meaningful growth in free cash flow while prudently managing dilution. Free cash flow was $283 million in 2025, which more than tripled from the prior year. Outstanding shares grew only 5% year-over-year. resulting in substantial growth in free cash flow related to growth in our share count. This quarter, we adjusted our presentation of cash flow, making it simpler for investors to calculate a model by removing the impact of pass-through customer funding activity.

I'll now discuss dilution management on Slide 18. In 2025, we made progress across each of the metrics we track. Stock-based compensation as a percentage of revenue was 9.5% for the full year, approximately 250 basis points lower than in 2024. In Q4, stock-based compensation was $41.3 million, 0.8% lower year-over-year, the first year-over-year decline in quarterly stock-based compensation in the company's exchange. Dilution declined to 5%, a 140 basis point year-over-year improvement supported in part by the $23.9 million worth of share repurchase in 2025 under our [ 200 million ] authorization. The net burn rate fell 2.9% in 2025, improving 200 basis points year-over-year.

With that, I'll move to our outlook. For the first quarter of 2026, we expect revenue of $436 million to $438 million or 21% growth. First quarter revenue guidance reflects a strong start to the year continuing the momentum we have observed exiting 2025, favorable seasonality as well as early customer acquisition benefits associated with the recent [ 1% ] debt of cash [ revenue ]. Breaking down our revenue growth expectations, consistent with recent trends, we anticipate send volume growth to exceed revenue growth and revenue growth to outpace quarterly active customer growth, driven by continued momentum among high amount senders and businesses. Sell volume for active customer is expected to grow in the mid- to high single-digit range supported by the shift in mix towards among senders and businesses as we continue to make strategic investments and expand engagement in these customer categories.

For the full year, we expect revenue between $1.94 billion and $1.96 billion, reflecting a growth rate of 19% to 20%. And I'll provide more context on our outlook for the year. The majority of our revenue in 2026 comes from prior year cohorts, giving a strong visibility to the following year. As noted, we expect revenues from new products to more than double in 2026. New products growth will be driven primarily by flat remittance volume, membership fees and growth in business remittance volumes.

Now let us give it to profitability and expense guidance, starting with RLTE. We expect Q1 and full year RLTE margin to be broadly in line with 2025 levels, adjusting for normalized transaction loss rate. As always, transaction loss rate may fluctuate quarter-to-quarter, and we remain disciplined about optimizing customer lifetime value while rigorously managing risk across our platform.

Shifting to marketing. We expect continued marketing efficiencies in 2026 as we prioritize high ROI marketing opportunities in our core remittance business while continuing to invest in marketing for new products and customer categories. For Q1, we expect marketing spend per QAU to be roughly flat year-over-year. Putting this all together, we expect Q1 adjusted EBITDA to be between $82 million and $84 million, translating to an adjusted EBITDA margin of around 19%. For full year, we expected adjusted EBITDA to be between $340 million and $360 million, representing an adjusted EBITDA margin of around 18% as product and marketing investments supporting new products are expected to build throughout the year.

The improvement in adjusted EBITDA margin year-over-year reflects continued operating leverage, supported by the prudent use of AI to improve operating efficiency and actions taken this quarter to better align with global resources with our most significant growth opportunities. We expect to generate positive GAAP net income each quarter this year and strong year-over-year growth in GAAP net income and free cash flow.

In terms of cash flow priorities, after organic investments, our top priority will rename the repurchase of shares. At current stock prices, we believe the repurchase of shares provide a strong return on capital and we expect to increase the quarterly pacing of our buyback activity in 2026.

To summarize, in Q4, we delivered very strong results across our key financial metrics, achieving 26% revenue growth and 20% adjusted EBITDA margins. We also delivered record GAAP profitability and strong free cash flow, underscoring the power and scalability of our business model. Thank you, Matt, for your inspiring leadership all these years with very strong momentum exiting 2025 and Sebastian's leadership going forward, we are excited about the future. With that, Matt, Sebastian and I will open up the call for your questions.

[Operator Instructions]

Our first question comes from Tien-Tsin Huang with JPMorgan.

Great. Yes. I just want to add my thanks to Matt as well. I learned a lot from you, Matt, and what you've built. So hopefully, we'll be able to stay connected here. My question, maybe just for Sebastian as we have you, and I'm sure we'll learn more and I appreciate your intro on yourself. But just given your background, what's really interesting, I would love to hear a little bit more on how your prior experience prepares or informs your decision to join and lead Remitly, given that it is a smaller consumer platform different than some of the larger enterprise businesses that you led. So just love to hear your thoughts on that.

So thank you for the question. Some of my prior experiences include leading product organizations and engineering organizations and some of the best companies in the world, some of those were big. Some of those were smaller. I've run large, complex businesses in many continents. I've been a CEO a number of times. And specific to payments on the Remitly business, I did run the payments business at Amazon, as I mentioned, both on the consumer side and on the merchant side, those were not always big, but they did scale. And this included all the money in and the money out channels for the Amazon business. And then finally, over the last few years, I've played both the Board role and a product role at Santander, helping its very successful global digital transformations in its core business and its payments business. So I think the sum of all these experiences position me well to lead Remitly in this next chapter of scaling.

Great. Yes. And the only thing that I will add, Tien-Tsin, is huge thank you to you. I've known you for a decade, you're an amazing analyst, and I appreciate all the thoughtful questions and coverage. I am incredibly excited for Sebastian to be here. And I -- which you could see me because I have a huge smile on my face sitting next to him here in Seattle. I've lost my voice as you can potentially hear. So I'm speaking a bit more slowly and calmly, but the feeling I have is he's calm optimism about this change. And you'll hear more from Sebastian and Vikas today, which is great. And just super excited about what's to come.

Our next question comes from Ramsey El-Assal with Cantor Fitzgerald.

I'll also add, Matt, it has been terrific interacting with you. all these years and welcome to you, Sebastian. Matt, I'm going to spare your voice and actually ask Vikas a question. What are you seeing out there in terms of kind of macro impacts to the business thinking things like FX or immigration policy or any other external factors. I guess the more nuanced question is, did you grow through any headwinds? Or are these macro factors that are in the headlines just not impacting your business?

Thank you for the question. And I'd start with the fact that we had an exceptional year in a quarter as we ended the year with record revenue, record EBITDA and EBITDA margin. And a lot of that was because of really strong execution, especially in the December holiday period, we saw significant outperformance even compared to our internal expectations. And as we noted, it was along with driving marketing efficiencies at the same time. So a lot of it was really strong execution, understanding the customer needs and really having a product and a marketing message that has resonated with our customers.

As we look forward, we shared our guide and the drivers of the guide. I'd say, first of all, building on a strong FY '25 gives us a lot of predictability coming into the year. We see that our customer is very resilient even in sort of geopolitical volatile background, which again strengthens our confidence with regards to the guidance. The one additional factor, which is a good tailwind at least in the beginning of the year is the 1% remittance tax that's applicable for cash remittances. So we definitely see a strong start to the year because of that. But overall, the diversification that we have across geographies, customer and new products, the new product momentum we have seen thus far, all of us -- gives us a great confidence in the guidance we have put forward.

Our next question comes from Aditya Buddhavarapu with Bank of America.

Just wanted to say Matt, congratulations on the successful run at Remitly and Sebastian, welcome. I have a couple of questions actually for Vikas as well. When I look at the 2026 guidance, you're talking about the 19%, 20% growth on revenues for the full year, with Q1 actually being at 21%. So could you just talk a bit more about the cadence of revenues through the year? Is Q1 faster than the full year outlook because of the 1% remittance tax giving some tailwind given you have actually easier comps in H2 -- actually, there may be some degree of conservatism there given maybe macro uncertainty. So just some color on the quarterly cadence and they're also related to the outlook for '26 when you expect Q4 was 20% adjusted EBITDA margin for '26, the implied margin is close to about 18%, 19%. So could you talk what's driving maybe that sort of margin in -- for the full year being lower than Q4.

Yes. Aditya, first of all, thank you for the question, and thank you for initiating coverage on Remitly. I'd start with your second part of the question, and then I'll go the first part. So as you noted, we exited 2024 with a very strong Q4 and a record EBITDA margin of 20%. There were a few reasons for that outperformance. And I'd say the 3 key ones being a strong holiday period, along with marketing efficiencies, which pretty much grow 1/3 of that, call it, beat to guidance. The second important factor was a record loan transaction loss. It was at 7.3 basis points, which again, was very, very strong, especially given the new AI model that we have been able to deploy. And the final one was disciplined expense management. So as we look at we think about, for example, the transaction loss tends to be volatile. And we -- in our guidance and our forecast, we look at the normal range, historical range, which is 9 to 13 bps and we take that as, call it, the baseline. Outside of that, we really feel that with strong execution, again, we are going to continue to drive margin expansion compared to the full year FY '25.

At the same time, we view the organic opportunity ahead of us is huge. And as we have spoken about it earlier, the new product momentum has been good. So we want to invest behind that trend that we are seeing. So overall, we feel it's a very balanced profitability plus growth equation we are striking here.

Shifting to your question on the revenue drivers and the seasonality thereof, the first point I'd make is that H1 versus H2, it's a similar thing that we saw last year, where the growth rates moderate in the second half, it's a little bit of the larger the business gets, it tends to follow that curve.

The second thing I would say is, as you noted, in Q1, we benefit from the [ remittance tax ], and there's a little bit of a shift in the Ramadan timing also, moving a few weeks ahead compared to last year, and both those give us stronger confidence with regards to Q1. So overall, really looking forward to an exciting 2026. And as I said, a strong foundation from 2025 gives us a great momentum going in.

Our next question comes from Will Nance with Goldman Sachs.

And Matt, it's been a pleasure working with you. I guess one, maybe for Sebastian. I think in the prepared remarks, Matt called out the ability to accelerate product innovation and execution and some operational benefits given your history. When you look at the business kind of exiting the year in the mid-20s on revenue, margins expanding nicely, where do you feel like you can have the most impact in some of those things that Matt mentioned at the top of the script? What do you expect to be your main areas of focus as Matt kind of hands over the reins.

Yes. Thanks for the question. I start as CEO tomorrow, so I don't want to get ahead of myself here. I think I'll make a couple of comments. I think these are very large markets. We are -- we've got a lot of traction in the consumer markets. We see, as Vikas and Matt have said, an opportunity in the business market and even within the business market, there are many, many subsegments. I think product -- having the right product for each of these segments is super important. So I think that overall, any velocity in product development is going to give us all kinds of opportunities in these large markets that we have to address. So a little bit early for me to have a strong opinion, but very excited about what we can do in these markets.

Our next question comes from Chris Kennedy with William Blair.

Yes. Congratulations to both Matt and Sebastian. Just a follow-up, Sebastian. You mentioned your history with data science and your enthusiasm around AI. Can you just provide more color as to kind of what the opportunity is at Remitly?

So maybe I'll stay away from -- I'll make just a few general comments. I think there are a number of buckets of AI. There's the customer-facing part of AI. There's the internal efficiencies facing part of AI, there's the software product -- the software factory part of AI. So -- and we've all been following this. I think there's -- as I said, for an incumbent like Remitly with a very strong business model, the right unit economics and the customer that loves the product, and probably doesn't only apply for Remitly, I think that the right AI adoption just gives us a lot of tailwinds into the next few years. So that will be my general statement. I'm very optimistic with what I've seen so far. I think it's going to be a very strong multiplier for the company over time.

Our next question comes from Alex Markgraff with KBCM.

Matt, Sebastian, congrats to both of you. I guess just -- I don't know if these are for Matt or Vikas, but just a couple of questions on new products. I'd be curious to understand sort of what sort of observable benefits you've seen from Flex and one on wallet share. And then just sort of curious on willingness to pay anything you've learned in these early days around willingness to pay for those from customers.

Thanks, Alex. Vikas one. We have been very impressed with what we have seen thus far from Flex. First of all, it opens up a whole new category with Send Now, Pay Later. And as we talk at Investor Day, if you look at our customers and segment them or categorize them, you will have the low amount tenders, high among vendors, businesses and receivers. And as you look at low amount tenders, there's a clear mismatch between the timing of earnings and when they need to make payments. In addition to that, specifically for our customers, sometimes there's also a mismatch between their credit history versus the creditworthiness.

And this is where we feel we can fill that gap and voice in a meaningful way for the customer, along with driving really positive unit economics and creating shareholder value. And what we have seen thus far is pretty promising. 120,000 users, revenue almost doubling quarter-over-quarter. And along with that, clearly maintaining strong unit economics as well as having provisions very much in line with our expectations.

The last point I'll make on that is, we've also seen very interesting insights that the Flex users especially members tend to send more than the non-Flex users/members. And that clearly shows that not only are we creating a new category, we are actually creating a path where higher volumes are sent and we are reducing some of the friction that was existing earlier. So overall, excited about Flex as well as Send Now, Pay Later in general.

And our final question comes from Darrin Peller with Wolfe Research.

Matt and Sebastian, congrats to both of you guys. I just wanted to touch back [indiscernible] quarter is a clear about that names. But if you look at both [indiscernible], it was obviously a very strong upside surprise. And so when we think about the opportunity you're seeing in terms of the higher spenders. And maybe just reminding us what other scenarios, what other results grow, but we love to hear what you're seeing in terms of strategy around Ispenders and that's really driving that and maybe other factors all that you see in the quarter driving the upside?

Thanks, Darrin. Clearly, the trend that we are seeing is that the higher mom centers are sending more and the product improvements that we are doing, raising the send limits, having the right marketing campaigns are resonating as well. And this shows in the numbers. We had in record send per QAU, both from a dollar perspective, about $2,200 as well as growth at 13%. And if you feel that further, in fact, you provided a slide that breaks out low amount senders, high amount senders and we added 1 more tier to call out very high amount senders, which is people who spend or send more than $10,000 per transaction. And we are seeing really high growth rates with north of 40% on the high amount senders and north of 100% send volume out for the very high amount senders. And again, as we say, we are just getting started there, and with more product innovations and a more front-footed marketing campaign in that space will continue to drive higher market share gains, and we feel very excited about that in 2026 and beyond.

Great. And I'll just wrap with a couple of thoughts. Our ambitions at Remitly have never been higher. And if you look at our vision of transform lives with trusted financial services that transcend borders, that is our anchor. And as we think about this transition, as we think about Sebastian coming on, as we think about its product-led leadership, operational excellence, that is going to be a huge, huge accelerant to help us accomplish the vision and financials that we laid out at Investor Day.

And to wrap, as my last earnings call as CEO, I just want to say an enormous thanks to our investors, to our analysts, to all of our thousands of team members and to our millions of customers around the globe. This business is already making an enormous impact and it is because of you, and we are very much more than ever just getting started.

Thank you. This concludes the question-and-answer session and today's conference call. Thanks for participating. You may now disconnect.

All right. Welcome, everyone. I think we'll go ahead and get started here. Good morning. I'm David Beckel, Head of Investor Relations at Remitly, and would like to welcome you to Remitly's first ever Investor Day. We have an exciting couple of hours planned for you. Our CEO and Remitly's Co-Founder, Matt Oppenheimer, will outline our long-term vision and strategic direction. Pankaj Sharma, Remitly's Chief Business Officer and the second longest tenured Remitly speaking today will showcase the durable growth potential of our core remittance business.

Our Chief Product and Technology Officer, Ankur Sinha, who before joining Remitly, spent 15 years at 2 of the world's largest technology companies, Microsoft and Google. He'll provide an overview of new customer categories we're pursuing, the new products we're launching and the underlying platform driving Remitly's innovation. And our CFO, Vikas Mehta, who you all know, will outline our plans for driving long-term shareholder value. This presentation in total will last a little bit more than 2 hours, after which point, we'll take a quick break and then get to your questions.

Now before we start, I would like to remind everyone that we will be making forward-looking statements within the meaning of the federal securities laws, including, but not limited to, statements regarding Remitly's future financial results and management's expectations and plans. These statements are neither promises nor guarantees and involve uncertainties that may cause actual results to vary materially from those presented here.

You should not place undue reliance on any forward-looking statements. The following presentation also contains certain non-GAAP financial measures. For a reconciliation of non-GAAP financial measures to the most directly comparable GAAP metric, please see the appendix, which is also made available online. I'll now turn the presentation over to CEO, Matt Oppenheimer. But before I do, here's a short video explaining who Remitly is and where we're headed.

[Presentation]

Good morning, everyone. I am thrilled to welcome you to Remitly's first-ever Investor Day. Today, we'll talk about how we're building a durable and global financial services company, one that offers financial services that truly transcend borders and a company that combines a bold vision with disciplined execution to deliver both meaningful customer impact and outstanding shareholder returns.

Here's where I'll take us this morning. First, I'm going to set the stage. I'll ground us in where we are today, our vision, the momentum behind our business and how we think about long-term value creation. Second, I'll talk about our vision and growth strategy, specifically expanding on the customer categories that we serve and our product vision in more detail that we have for our customers. Third, I'll talk about our core strengths. I will specifically answer some really important strategic questions. Why has Remitly won over the last 15 years? Why will we continue to win? And why are we uniquely positioned to accomplish the vision that I'll lay out.

Next, I'll cover technology trends. I'll share how specifically stablecoins and AI are already accelerating the delivery of our vision even further and expanding our long-term upside. Along the way, I'll connect the dots from who you'll hear from next, Pankaj, Ankur and Vikas and later Q&A with Ronit and Saema because the story of Remitly obviously, is a team effort of thousands of Remitlians around the globe, including Remitly's Board of Directors, many of whom have traveled to be here today.

Finally, I'll cover shareholder value. I will explain how our vision and driving shareholder returns are obviously deeply aligned. We have deep conviction that our structurally advantaged business model is great for shareholder returns. And Remitly is already GAAP profitable, growing fast and scaling efficiently. And as you'll hear today, we are on track to deliver nearly $3 billion in revenue and close to $600 million in adjusted EBITDA by 2028.

All right. So starting with our vision. Our vision is 9 very carefully selected words: transform lives with trusted financial services that transcend borders. There are 3 parts to that vision that are important to understand. The first, transform lives. It captures our purpose. The second, trust. It is nonnegotiable in consumer financial services and specifically in our industry. It's overlooked, but the most important asset. It's also very hard to build and maintain. Remember this because I'll come back to it as one of our core strengths.

And then finally, financial services that transcend borders. This right here defines our unique competitive position. We serve a global community that is often underserved and overcharged, and we do so with reliability, fairness and humanity. This same vision guides us as we expand to new countries, new customer categories and entirely new products. In order to contextualize our vision, we must briefly understand our roots. Before starting Remitly, I lived and worked on 3 continents. And back in 2011, I was living and working in Kenya. I was getting paid in British pounds. I needed to convert to Kenyan shillings to pay my daily living expenses, and I eventually had to get money back to U.S. dollars.

I experienced firsthand how hard it was to send money internationally, which we all know, right? It's expensive, it's inconvenient, it's unreliable. And I also saw how hard it was beyond payments to get basic things set up like a bank account or to get access to credit being new to a country. That sparked our vision to create the leading financial services company that offered financial services that truly transcend borders. That idea is the core of everything that we continue to do. However, we started to solve this problem with a principle that I advise entrepreneurs on today, bold visions, I believe, are only accomplished with intense short-term focus and always, of course, working back from the customer. Sounds obvious, but most entrepreneurs with bold visions, I believe, often lack short-term focus.

And Jeff Bezos, who was one of Remitly's very early investors, did this exceptionally well. Obviously, Amazon had an incredibly bold vision. But people forget, Amazon not only started within e-commerce, but they started specifically and only as a bookseller online. For us, our vision has been financial services that transcend borders. Yet we started with a focus not only on remittances for low amount senders, but specifically focused on one corridor, U.S. to the Philippines for 2 years. And you can see our first customer here, Earl Golla, who's become one of my good friends. He was in my wedding. He's a wonderful human, sending his first transaction to the Philippines. And 2 years later, we added India, 2 years later. And then another year later, we added Mexico. So keep in mind, 4 years into the business, we were only in 3 corridors or 3 country pairs when we say the word corridor.

With that strong foundation from that intense focus, we then expanded to many new corridors over the last decade or so, 5,300 corridors today, but primarily focused on low amount senders where people sending a few hundred dollars needed to get money home and focused on high friction corridors, emerging markets destination where speed is even more critical and complexity runs incredibly high. But you can't deliver a great product until you built the infrastructure which we have spent the last decade building out.

Solving those hard problems to start was not only important from a mission standpoint. But if you think about it from a classic disruption theory standpoint, it got us focused on the hardest problem to solve for often overlooked customers, and then it required us to engineer efficiency in the unit cost into every layer of our model. And this helped us achieve significant scale, yet, as you'll hear about in a moment, we are still just a fraction of that market with ample headroom for growth.

But most of you know our story as it pertains to low amount centers. It's a critical part of our business, and it will continue to be. Pankaj will go into more depth here, and I am excited for you to hear from him. So today, I want to talk about the future. In the future, Remitly will be the premier financial services company that offers financial services that transcend borders for 300 million individuals and over 80 million small businesses with cross-border needs. You will see this specific slide a lot today.

So let me walk you through a few examples of what it means from a customer and product standpoint. It means offering low amount customers additional benefits to deepen the relationship by adding more value via membership and loyalty, products like Remitly One and send now, pay later, which leverage our unique remittance data to provide credit access to those that are credit invisible with the credit bureaus but have high creditworthiness. It means a high amount sender living in France that needs to make a $25,000 transfer to Canada can do so at a lower cost and faster speed, again, thanks to our disruptive approach that gives us highly optimized unit economics to move upmarket.

It means a small business owner in Pakistan, who has just completed some digital design work for a customer in the U.K. can use our platform to get paid immediately and affordably. And it means receivers such as the mothers of one of our customers in Argentina, can receive her remittance into a more stable U.S. dollar stored value account, leveraging stablecoins on the back end, all within her Remitly wallet. And then instantly and affordably withdrawing those funds given Remitly's unique network that I'll talk more about in a minute.

We're taking a focused approach to these broader products. But over time, you will see all 4 of these products offered to all 4 of these customer segments, all powered by Remitly's unique platform. And you'll hear more about each of these areas from Ankur and Pankaj today. Needless to say, so I'm going to cover this section briefly, our vision presents a huge opportunity. The global cross-border payments market only, just payments. Consumer and small business is massive and still growing. Over $22 trillion flows across borders each year.

Our customer category alone, the consumer customer category is around $2 trillion of that total, and we're just scratching the surface there. What's powerful is we're not limited to that. As we launch each new product, whether it's high amount senders, businesses or receivers, it expands our total addressable market by orders of magnitude. Make no mistake, this is a multitrillion dollar opportunity, and we are already executing against it with proven economics. This large market opportunity and disciplined execution is working, and it has resulted in significant growth. We have grown from 1.9 million quarterly active users just back in 2020 to 9 million quarterly active users or 5x. We've grown send volume from $12.1 billion in 2020 to $70 billion or 6x. And we've grown revenue less transaction expense or RLTE, which you'll hear about today, 7x to $1 billion over the last 12 months. That scale, as you'll hear about in a moment, did not come from chasing growth at any cost. It came from building trust corridor by corridor, customer by customer.

And that brings me to a question that investors and a lot of folks often ask, how has Remitly consistently outperformed in such a competitive market? It comes down to 3 core strengths: trust, network and scale. I'll tell you more about each of these areas, starting with trust. As I mentioned, trust is so important to our customers and business that it's 1 of our 9 very carefully selected words in our vision statement because make no mistake, trust is the foundation. We send life-changing transfers. And in that context, delays are not acceptable and a reliable, fair and secure product is paramount.

Additionally, we're required by regulators and with our various risks systems to collect a multitude of personal information. And for everyone in this audience, I want you to take a second. And I want you to think about giving out your information, specifically your name, your address, your Tax ID or social security number, your date of birth, your bank account information and then potentially additional information like a pay stub, a passport or details on the source of funds for your transfer.

Now imagine that you're new to this country and already in a heightened state of nervousness. Suddenly in that context, saving $1 or $2 for a better price matters less than reliability, fairness, security, all of which ladder up to trust and all of which are nonnegotiable. And customers, because of this, make no mistake, do their research. And when they do their research, they see our apps carry a 4.8 plus star ratings and Trustpilot industry-leading scores of 4.6 with over 5 million reviews. Our brand earns repeat use in advocacy. Trust drives retention, retention drives lifetime value and lifetime value paired with discipline drives free cash flow. That's why trust is our first core strength and the reason we win corridor by corridor, which Pankaj will go into more depth in his section.

Our second strength is our network. It is the engine that powers how money is moved across the globe fast, reliably and affordably. And I'm going to spend a minute on this, given its complexity and its importance. Our proprietary global partner and payout network spans more than 5,300 corridors, again, country pairs, more than 100 currencies and more than 170 countries, spanning over 5 billion bank accounts, mobile wallets and cash pickup options, delivering funds instantly and conveniently.

This takes decades to build, especially if you want to build direct access to the last mile, which we have done with our network. And that makes it fundamentally higher quality than both the legacy remittance players as well as bank wire transfer networks like SWIFT. What does this mean for customers? At a high level, it means 94% of transfers arrive in the recipient's bank account or wallet in under an hour, 24 hours a day, 7 days a week. And there are so many other stats and elements that I want to talk about here, but Pankaj is going to go into more detail, and so you'll hear even more what it means for customers from him.

This network is further reinforced by our proprietary data, as you can imagine, processing more than 100 terabytes of data, powering personalization, speed and advanced fraud prevention. You'll hear more from Ankur on that. And then finally, a key part of our network is our regulatory and compliance infrastructure with over 100 financial services licenses across the globe that enable us to operate safely and responsibly. This network is the second of the 3 core strengths that make Remitly's competitive advantage durable and scalable.

Finally, on scale. Scale is where it all compounds. And this is the Remitly flywheel. Our flywheel, to be clear, has a lot of depth around it. And if you were at Remitly, you would see it's deeply integrated into our strategic planning process. Every spoke, lower cost structure, better prices, enhanced customer experiences, more customer actions and greater service selection drives the center of the flywheel, which as investors, you will appreciate is free cash flow.

And here's the exciting thing. We have reached an inflection point where profitability is now reinforcing growth. Our free cash flow has gone from negative $1 million just 3 years ago, just 3 years ago to $214 million in the last 12 months. Strong unit economics plus scale as defined by our flywheel, plus OpEx discipline equals greater free cash flow. And I am super excited about what this chart will look like in another 3 years and specifically scaling to $600 million in adjusted EBITDA, which Vikas will share some more detailed numbers on in his section.

These are Remitly's 3 core strengths: trust, network and scale. These strengths create a durable competitive moat as Remitly consolidates a highly fragmented industry with the largest incumbent holding only about 6% market share, leaving room for several digital-first winners, but only the ones that have more scale. Remitly's combination of a trusted brand, network and proven scale positions us to win customers who increasingly demand reliable, fast and locally dependable remittance services, which we uniquely deliver.

With that understanding of our vision and our strengths, let's turn to the next section, which I want to share some thoughts on some technology trends that we're leveraging to accelerate velocity towards accomplishing that vision. I'll start with stablecoins as the first, and then we'll cover AI as the second. At Remitly, it's important to contextualize that we have leveraged technologies, emerging technologies since our inception. The way we've been successful has been a simple principle, but often overlooked when new technologies are emerging. It's always work back from the customer. This could be the end customer being Remitly as a customer or it could be our end consumers.

And with stablecoins, there are both opportunities. Ankur will talk about some of the more incremental opportunities that you can see here, specifically our treasury and network. I want to talk about the more transformational, which is the third. stablecoin wallets, and this is where I believe stablecoins present the biggest opportunity for our business. Specifically, I am incredibly excited about customers being able to hold a USD stablecoin in digital wallets as a store of value in emerging markets where the currency is more volatile.

Historically, dollar and multicurrency accounts have been something that have been available to those with high net worth or those in developed countries, but not everyone around the globe. We will enable that future. However, as we enable that future and we leverage stablecoin technology, regulation will still dictate stablecoin usage. So I believe that stablecoin usage will vary by country, and we have a great perspective given that we operate in 170 countries. Some countries have already banned it. Some countries have embraced it. And I believe most and many countries will continue to embrace it, but with constraints, giving customers the ability to hold some savings -- savings in a USD account, but eventually requiring that funds be converted into local fiat currency.

We will uniquely offer these stablecoin savings accounts in emerging market countries where it is possible. Why is that the case? Why can we uniquely do this? Three reasons. First, we already have access to 20 million receivers that are receiving funds mostly in emerging markets. Second, we are great at making these funds useful locally given the Remitly network. And third, we have a differentiated regulatory approach and expertise that enables the future that I just mentioned. This is a huge opportunity and a key part of our strategy. You'll hear more from Ankur on this in a bit.

Just as stablecoins reshape how money has moved, AI is transforming how we build, scale and serve customers. Our Agentic AI now resolves 1/3 of customer support chats. 4x faster than human counterparts with equal or higher customer satisfaction. Remitly on WhatsApp leverages AI to make it even easier for customers to digitally interact, accelerating that off-line to online shift given that it's an easy, low friction way to start to engage with Remitly on a platform that they already use.

And then behind the scenes, as you can imagine, but it is very palpable at Remitly, AI makes our operations faster and leaner across all functions, product, engineering, risk management, customer support, finance, marketing across the board. So in short, with AI, it means better experiences, faster innovation, higher margins. And Ankur will show how AI accelerates our product velocity and improves customer value, while Vikas will connect the dots on margin and OpEx discipline. That is the future and where we're heading, and those are the technologies that we are leveraging to get there.

As I close things out, I want to circle back on a few points on what this means for you, our investors. The first point is obvious but important, and that is that our vision and shareholder returns are very aligned. Our strategy and comprehensive strengths are underpinned by a simple equation with 5 distinct levers that drive long-term shareholder value. At the end of the day, all of them ladder up to our North Star, growth in adjusted free cash flow per share. Everything you'll hear about today, our core business growth, customer expansion, new products, durable RLTE and marketing and OpEx discipline works together to achieve that goal. These levers ensure that every dollar creates durable value for our shareholders and fuels sustainable revenue and margin expansion.

And later today, you will hear from Vikas, who will take you through the how these levers specifically translate into our financial model and long-term returns. No one yet has accomplished what we have set out to do, to create financial services that truly transcends borders that is trusted by millions of senders, receivers and businesses around the world. But the foundation is here. The technology is ready, and our momentum has never been stronger. And as I've said before, and I'll reinforce today, we are a growth company with no shortage of growth opportunities. If the first 15 years were about cross-border payments for low amount senders, the next chapter will be about continuing that journey, but expanding possibilities to new customer categories and products powered by AI, stablecoins and strength of our platform.

We are executing from a position of confidence and discipline with clear line of sight to $3 billion in revenue by 2028 and a model that only gets stronger with scale. As you know, I end every earnings call with a customer story. And that's because this is only possible because of the 9 million quarterly active users we serve. 9 million individuals, 9 million stories and journeys, 9 million reasons why we do what we do. And to make just one of these stories a little more real and tangible. We will now hear from a customer who has been with Remitly since August 2022.

[Presentation]

We are incredibly grateful for customers that like the one you just heard from. And with that, I am excited to turn it over to Pankaj, who is not only our Chief Business Officer, but also someone that I've had the privilege of working with over the last 8 years. Pankaj?

Thank you, Matt. Hearing you articulate that vision always reminds me why this work matters. I joined Remitly 8 years ago when we were a start-up doing $100 million in revenue. And since then, we have scaled more than 15-fold. But what hasn't changed is why we do this. As someone who has lived and worked across 3 continents, I have experienced firsthand how hard and painful cross-border financial services can be. And that's exactly why I care so deeply about this work.

I'm really excited to take you through how we have built one of the most trusted and reliable global money movement products in the world, a product that has earned the confidence of millions of customers worldwide. I will explain how by scaling across new geos and customer categories, we are set to drive the next phase of durable profitable growth, powered by the same differentiated growth engine that has made Remitly a leader in global money movement.

If I step back, Remitly's growth story has always been grounded in trusted, repeat relationships with our customers. There are 3 key drivers of this growth engine. First, geo and customer category expansion. As we win the confidence of our customers in existing corridors through a superior and reliable product, we use that experience to unlock new corridors and new customer categories, widening our addressable opportunity.

Second, efficient customer acquisition. Every dollar we spend is measured against customer lifetime value, not just new customer counts. And we balance global scale with localized and culturally nuanced approaches to drive high ROI customer acquisition. And third, strong lifetime value and retention, built on reliable, delightful experiences paired with fair intelligent pricing that aligns value for customers and for us. And together, these drivers reinforce one another, making our growth durable and profitable.

Our growth can be summarized with a simple but powerful equation. Active customers, times customer lifetime value, which we measure as RLTE, or revenue less transaction expense. Every growth decision from marketing to pricing to product experience is viewed through this lens.

And through a disciplined, maniacal focus on this growth objective function, we have delivered staggering active customer growth of 13.5x since 2019, while also driving customer LTV expansion measured in terms of RLTE per customer by 43% in the same time period. And it reflects the power of staying disciplined on what matters most, and we see a long runway to keep strengthening both sides of this equation.

Now let's go one click deeper into each pillar of our durable growth engine, starting with how we are expanding reach through new geographies and new customer categories. Let's start with the big picture. Remitly today is only a 3% share of the $2 trillion consumer cross-border payments volume globally, and that's the opportunity in front of us. The global shift from offline to digital remittances continues to accelerate, and Remitly is leading that transition and capturing significant share as a result. Even within our core corridors of Mexico, India and Philippines, we have significant room to expand. We have grown our share from 4% to 12% in just 5 years. That's compounding at 35% annually compared to the industry average of less than 10%.

And these are multiyear growth corridors with expanding remittance volumes and our share gains continues to accelerate. So we are winning the share of volume where we already compete and there is substantial global opportunity in front of us. Moving to geo expansion opportunities. We started in 2012 with just 3 corridors. As Matt highlighted, the first corridor being U.S. to Philippines, then U.S. to India and then U.S. to Mexico. And these 3 corridors covered a mere 10% of global C2C remittances volume.

Today, we operate across more than 5,300-plus corridors. And as we expand across geographies, we continue to unlock incremental TAM. Our corridors now cover 61% of global C2C remittances volume. And that expansion reflects a disciplined, repeatable playbook. We deepen share where we are strong at and then expand methodically into new geos, new customer categories, new use cases where our trusted model scales best. And while meaningful, our coverage map, as you can see over here, presents a significant growth opportunity. We are live in only 24 of the top 50 send countries from a C2C remittances TAM perspective, where the top 50 represent 92% of the global C2C TAM.

Our next chapter of growth will come from both share gains in existing regions and expanding into the remaining high opportunity geographies and new customer categories. The next geography expected on our road map is the Kingdom of Saudi Arabia, which, as you might know, is one of the largest remittance sending countries in the world.

Let's move now to new customer categories. As Matt noted, Remitly historically has focused on serving low amount transfers that are high frequency, where trust, reliability and trust and access matter most. And as we have built scale, trust and efficiency with those customers, it's opened a huge opportunity for us to go upstream, serving high amount transfers and small- and medium-sized businesses who send large amounts less frequently but are far more valuable from a customer lifetime value perspective.

And the high amount sender category is massive and underserved, very few scaled digital players. And hardly any banks prioritize this use case because it's not core to them. And these customers already trust us with their money. By expanding our send limits, tailoring our pricing and improving our product experiences, we have started to win share of this category. High amount transfers now make up nearly half of our monthly send volume. And importantly, customers that send higher amounts have higher lifetime value and lower cost of acquisition compared to less than $1,000 senders.

And the next frontier is small- and medium-sized businesses, another large and underserved category where cross-border payments remain slow and complex and where Remitly's trusted low-cost platform gives us a real advantage. And Ankur will provide more details on those category expansions. Now let's move on to the next layer of our growth engine, the efficient and profitable acquisition of customers. At Remitly, we have built one of the most data-driven, high-performing customer acquisition systems in fintech, where we balance global reach, local nuance, cost efficiency and long-term value creation.

And our customer acquisition engine is designed not just to convert new customers, but to build trust from day 1. And we accomplished this across 4 stages, as you can see on the slide. At Discover, we meet customers in their own language and context, ensuring that they feel seen and understood. At Tri, we deliver a frictionless onboarding experience that just works. And at Trust, we sustain industry-leading customer satisfaction as evidenced by our 76 NPS for repeat customers and App Store ratings that are near 5 stars.

And at word of mouth, it comes full circle. Over half of our new customers have heard about Remitly from their friends and family. And as a result, every acquisition dollar that we spend has a high probability of creating a customer that not only stays but brings others with them.

Let's unpack what makes it so effective. So our customer acquisition engine runs on 3 reinforcing levers. First, global scale tailored for local nuances, marketing campaigns that run across 30-plus countries, 25-plus marketing channels and 13-plus languages, all tailored for cultural nuances, but powered by one single unified global platform. Second, high-impact targeting and creative discipline. Every marketing campaign is built around deep diaspora insights, combining emotional storytelling with data-backed targeting.

And third, relentless data-driven optimization, using data, machine learning and AI models to continuously test and reallocate every marketing dollar based on incremental ROI. And the result is industry-leading returns, over 6x LTV to CAC ratio and under 12 months payback. Let's look at how that scale and local relevance come to life.

I'll now provide a bit more context on how we build brand awareness on a global scale. Our brand awareness engine is fundamentally different than broad mass market marketing. Our audience is incredibly diverse and deeply niche. And what I mean by that is, for example, the way a Mexican customer in the U.S. discovers and consumes media is very different from, say, a Tunisian customer living in France or an Indian customer living in Australia. So instead of spraying marketing dollars across upper funnel channels, we build brand awareness with precision.

We segment diaspora communities using deep cultural and behavioral insights, including what they value, what they celebrate, where they gather and how they consume media. We then activate through in-language creative, community-rooted placements and passion points that matter locally from sports to music to regional influencers. And increasingly, now we are using AI to scale that creative work, generating and adapting localized assets faster. So we can meet the needs of this diverse customer segment with more relevance and more velocity than ever before.

And the result is a brand engine that scales globally but feels very local. And that delivers far higher efficiency and impact than traditional broad reach marketing. Let me bring this to life with a couple of examples. So the first one in Australia, we localized our messaging and creative to diaspora communities and backed it with highly targeted out-of-home and digital campaigns. And that drove 139% lift in consideration and ultimately a 7% lift in new customer acquisition.

In Los Angeles, we applied the same playbook, localized creative and emotional storytelling through TV and out-of-home and saw double-digit growth in new sign-ups and new customer acquisition. These examples showcase how we convert cultural understanding and local position into measurable, profitable customer growth, a playbook that scales efficiently across markets. And the more we scale, the smarter and more efficient our brand awareness engine becomes.

Marketing efficiency improvements actually compound as we grow and optimize within regions. And as you can see in this example, in one of our newer regions, EMEA and APAC, as localization deepened and channels matured, our LTV to CAC ratio improved by more than 60% since 2021. And every new geo follows the same disciplined arc, test, localize, optimize and scale. And the longer we operate in a region, the smarter our models get and the more efficient every marketing dollar becomes.

And the same disciplined data-driven model delivers even stronger returns when we apply it to our most valuable customer categories. For example, the high dollar customers have an LTV to CAC ratio that is more than 50% better than others, allowing us to scale at extremely attractive payback. Our efficient acquisition engine is only one part of the story. What truly sets Remitly apart is what happens after those customers are acquired, how we retain, how we delight and how we grow customer lifetime value.

Let's start with a look at the data. So as you can see on the left, our 90-day retention rate is at its highest ever, up 8 percentage points since 2019, a clear signal of customer loyalty and stickiness in that crucial early adoption window. And on the right, you can see that each new cohort scales faster, sustains higher volume trajectories over time and stays longer.

And as we look at this data, there are 2 points that I want to highlight. First, our 5-year customer cohort LTV is actually understated. These cohort curves clearly show that customers stay active and spend longer than 5 years, which means the long-term economic value of each customer cohort is much higher than what our LTV model suggest. The second point is about the back book opportunity. As our back book of customers that have used Remitly grows, now millions of trusted long-tenured customers, we have significant headroom to deepen engagement with them. As we enhance the overall experience, introduce new products, we can activate and retain more of that base, increasing quarterly active users and RLTE per user without proportional acquisition spend.

So this combination of sustained retention and a growing back book forms a strong compounding growth engine. Our strong retention rates are a direct reflection of 3 pillars of our customer experience advantage. The first one, trust and reliability. Trust is the emotional foundation of our brand and shows up in our Trustpilot score, as Matt was also highlighting, 4.6, an industry-leading score. And reliability is our operational backbone with industry-leading 4.9 uptime.

Second, speed. It's a clear differentiator for us with 94% of our transactions completed less than 1 hour and 63% are completed instantly. And third, simplicity and delight, a product that just works every time as reflected in our segment-leading App Store ratings and turns satisfied customers into word of mouth as reflected in our high NPS scores. I'll spend a minute diving deep into each of these pillars, starting with the foundation, trust and reliability.

As Matt mentioned, trust is the foundation of our competitive strength. Trust is earned in part through industry-leading reliability metrics and scores. Reliability in turn, is supported by our network, built over 14 years of disciplined spend and scale. Remitly Network is today one of the most modern, diversified and intelligent global payout networks in the industry. Our network is now hybrid, combining direct fiat rails and with stablecoin and blockchain-enabled settlement, allowing us to move liquidity more efficiently, operate 24/7 and bypass many limitations of traditional correspondent banking.

Further to the stats on this slide, which you heard from Matt as well, over 60% of our global volume is routed directly to the recipients value store with no intermediary hops. And in fact, no more than 3.4% of our overall volume is completed with one single aggregator. And this network is our operational differentiator, delivering millions of customers fast, safe, secure and reliable money transfers so that they return again and again.

The second pillar of our customer experience advantage is speed, which is one of the clearest benefits of our global platform and one of the hardest advantages to replicate. Today, 63% of transfers on Remitly are instant and 94% arrive under an hour, placing us at near best-in-class globally. What drives this is our next-generation payments network that was highlighted in previous sections, I covered and Matt covered as well.

But speed alone isn't the full story. What really matters is the peace of mind. And one of the most customer-centric things that we do at Remitly is our perfect delivery promise, telling customers exactly when their money will arrive down to the minute and then working relentlessly to meet that commitment. We hit that promise 96% of the time, and we track it obsessively internally because we know how much trust is built when we deliver not just fast, but predictably and reliably.

This combination of instant delivery, reliability and a promise that we stand behind is incredibly hard to replicate. And it's one of the biggest reasons customers choose us and stay with us. And final lever of our customer experience advantage is simplicity and delight. When a customer sends money through Remitly, it just works instantly, intuitively and reliably. Features like sending via WhatsApp or two-step repeat sends make the experience seamless, turning convenience into habit. And that loyalty is what translates into our ever stronger cohorts and higher customer value.

The compounding and durable nature of our customer experience trends is evident in our data. Every year, our cohorts perform better than the last. On the left, you'll see 2025 cohorts sending more per customer than any year prior. And on the right, transactions per active customers for the last 2 annual cohorts are at record highs. Our customers are both staying longer as well as engaging more deeply with us. And put together, we have a strong retention engine and every new cohort performs better than the last, stays longer and spends more.

I'll now discuss pricing. When you deliver the most trusted, reliable, fast, simple and delightful experience, price becomes just one part of the value equation. Customers don't stay with Remitly because we are the cheapest. They stay because we are the most trusted, transparent and fair. Our pricing model balances customer value with long-term returns, grounded in cost-plus pricing discipline and optimize intelligently for sustainable growth.

Let's unpack this a bit more. As we scale and leverage new digital rails like stablecoin, our cost to serve continues to come down, driven by scale efficiencies, smarter network optimizations and the ongoing shift from cash to digital payouts, which are more than 70% cheaper than cash-based methods. Since 2018, our transaction cost per transfers have dropped 44% as higher volumes secure lower fixed COGS from pay-in and payout partners, a cost advantage that subscale players simply can't access.

What's powerful is how we apply those efficiencies. We apply a cost-plus pricing discipline, which means pricing based on underlying unit cost drivers deaverage corridor by corridor. And this approach allows us to both pass savings to our customers, strengthening loyalty while retaining our LTE margins. And that disciplined pricing philosophy shows up directly in how we price different corridors, and I'll bring that to life with 2 examples in the next slide.

So our pricing approach reflects both the underlying cost to serve and customer preferences in each region. For example, in the U.S. to India corridor, customers can choose between faster delivery or better FX terms. And the corridors pricing structures mirrors that choice, balancing speed with savings. In the U.S. to Colombia corridor examples, many families still receive cash, while others use digital methods like bank deposits or mobile wallets. And we align our pricing to those cost differences, offering flexibility without compromising fairness. And it's a great example of how our deaveraged cost-plus pricing model works in practice.

And behind that flexibility is a deeply data-driven system that learns from customer behavior and constantly refines affordability corridor by corridor. Every pricing decision is informed by thousands of data points per corridor. And in this example, it's one of our top 10 global corridors. We used elasticity modeling to calibrate affordability to local customer sensitivity. And as you can see, that optimization led to a 96% increase in RLTE even with stable take rates. And this is our intelligent pricing engine in action, where we balance affordability for our customers with sustainable returns for Remitly.

When we look at everything we have covered today, acquisition, retention, pricing, it's easy to think purely in terms of systems and numbers, which I'm sure this audience loves to look at. But for our customers, it shows up in a very different way. It shows up as peace of mind. We heard from a customer previously, here's another testimonial. Brisa sends money from the U.S. to Mexico and Guatemala. For her, this isn't a financial transaction. It's a commitment to her family, to her responsibilities, to the people who depend on her.

And as many of us in this room may not have personally experienced the challenges of sending money across borders, the uncertainty, the lack of transparency, the emotional weight of hoping it gets there on time and the vulnerability of having to enter your personal details into an app, trusting that your most sensitive information will be protected. And that's the lived reality of millions of people globally, and that's the problem we exist to solve.

What Brisa values over here, simplicity, reliability, clarity and choice is exactly what our model is designed to deliver. She can choose the delivery method that works for her family, sees the rate upfront, tracks her transfer in real time and knows it will arrive safely. And when you consistently remove friction from something that important, year after year, customers build deep trust in the experience, driving customer loyalty and word of mouth. And Brisa story is just one example, but it reflects the experience of millions of people who rely on Remitly to support the people they love across borders and across distances.

We have now come full circle. Everything we have talked about, expanding reach, acquiring efficiently, retaining and growing customer value comes together in one growth engine, an engine powered by real customer impact and strengthened by disciplined execution. That's why our growth compounds, more customers, higher value every year. And we are only at the beginning of this -- of what this platform can enable. The relationships we have built and the capabilities we have scaled open new frontiers of how we serve customers across borders and across their financial lives. And to walk you through that future, I'll hand it over to Ankur, someone who consistently pushes us to reimagine what's possible, and I'm excited to hear his perspective over here next. Welcome, Ankur.

Thank you, Pankaj. I have to say, I absolutely love the passion and dedication with which Pankaj has driven and grown our business. So thank you, Pankaj. Good morning, everyone, and thank you for being here. I joined Remitly almost 4 years ago, inspired by the opportunity to serve our customers and through to my role, help drive growth through innovation. Today, I'm excited to take you on a journey to look at how our products and our platforms are redefining financial access for our customers across the world.

I'll focus a bit more on showing than telling. So that means you'll see demos and metrics as examples of how these products come to life. Our vision has always been to transform lives with trusted financial services that transcend borders. And 2025 marks the inflection point where that vision becomes a full ecosystem reality. We're evolving from a single product remittance company into a trusted financial partner.

The evolution spans 3 dimensions: customers who we serve, products, how we serve them and platform, our core differentiator that enables new product development and customer value. Pankaj has covered how we offer money movement services to both low amount and high amount centers. We've also expanded to serve businesses and more recently, the receivers as new customer categories. We evolved our product offerings to include liquidity and credit through our Flex suite, a wallet and card and a membership through Remitly One, building on our strength in global money movement.

And at the foundation lies our Remitly platform, powered by AI and strengthened by stablecoins, connecting everything we do into one intelligent ecosystem. I'll start with our platform, then cover the new customer categories we're serving and end with the product lines with demos weaved into each. Our platform is our superpower. It lets us innovate faster, scale globally and deliver new customer value without reinventing infrastructure.

We purposefully built this platform architecture to enable the foundations of our multiproduct strategy. We've evolved from a single platform system to be a flexible and scalable platform, powered by shared services, modular components, real-time data platforms and advanced AI and ML models, all grounded in security and trust. There are 5 defining characteristics of our platform that drive growth, reinforce our competitive strengths and generate sustainable cost improvements. I'll cover each briefly.

First is rapid innovation. Over the past year, our platform has become our growth engine, driving the velocity of our innovation. We launched 5 new products in the last 12 months alone, a record pace while improving our developer throughput by 36%. Now you might ask why 2025 and why so many new products in 12 months? There are 2 reasons why that I want to briefly mention. First, our platform investments from 2023 and 2024 unlocked much faster product development.

Second, we test and iterate in market to get customer validation and only then broaden exposure of these products. This combination of a mature shared platform and much stronger customer signals on these new offerings is what enables more innovation now than in previous years. Second, for trust and compliance, our unified risk systems that span all of our products have driven record trust scores, reflected in sideline rates at all-time lows with a 50% reduction, 50% reduction year-over-year while optimizing transaction losses within our guardrails.

At the same time, driving 99.99% of reliability and maintaining 0 material security incidents since our IPO has helped further drive trust with our customers. Third, our platform enables a unique data advantage through insights generated from the data we collect and process. This data powers our intelligent pricing and differentiated experiences Pankaj talked about, leading to record high retention for existing customers. It also allows us to target our customers more effectively, whether that's in how we market or in using the proprietary data signals we have to better underwrite who we upsell our liquidity products to. This led to a 12% penetration for our Flex product, you'll hear about later.

Our data advantage also allows us to use these data signals we get to more effectively combat fraud through our AI and ML models. Fourth, on the AI front, we've used AI for many years effectively, and GenAI has further enhanced our efficiency to drive results. Speaking of results, from CS to fraud or pricing as areas or our teams in engineering, marketing, compliance or finance, this drives our ability to act faster and provide more effective service to our customers.

Our AI systems have helped reduce customer service costs by 40% this year and contact rates by nearly half, again, nearly half to be at historical lows, while at the same time, our defect rates have also dropped to record lows. Fifth, our platform enables us to improve margins as the scale of our volumes and the breadth of our integrations allow us to sustainably reduce unit costs while enhancing the redundancy and customer experience. Pankaj covered how we've reduced our cost to serve by 44% since 2018. This is what platform leverage looks like, bringing scale, reliability and innovation together to drive improvements in margins.

Let's move to talk about new customer categories we're expanding to serve, starting with one that is most exciting right now, businesses and how we're serving them with Remitly business. Small and medium businesses have been the heartbeat of the global economy, yet they've been underserved for decades. We saw a huge opportunity to extend our trusted network to them, offering simplicity, affordability and speed at scale. Let's take a quick look at how Remitly business works in action.

[Presentation]

Let's take a step back and look at the space a little bit. There are over 80 million small businesses worldwide, representing a more than $20 trillion opportunity. Yet most are underserved by legacy banks and fintechs, which focus a lot more on medium and large enterprises. Our business offering solves a number of these key pain points, common among incumbent solutions. Traditional solutions have been manual and slow. Onboarding, sending or receiving can take days. Remitly Business changes that. It's simple and fast to onboard and customers can send or receive in minutes, minutes, not days.

Our small business customers also told us that existing solutions are often priced for larger enterprises, making them feel expensive and misaligned with their needs. Remitly's scale in money movement and the similarity between these small businesses' payment behavior and consumer remittances, which we've scaled at, allow us to price right for these global small businesses.

Similarly, the overall experience in many of these existing solutions felt bloated for small businesses. They just wanted to onboard, make their payments and keep growing. So we designed our product experience specifically for these small business use cases, optimized for the fastest time to value at an affordable price. Our customer promise for these small businesses is super clear, make these cross-border payouts feel as easy as a domestic transfer. Our competitive edge is rooted in 3 things: access, trust and integration. For access, with coverage in over 170 countries and more than 100 currencies, we already operate one of the most extensive networks in the world. For trust, as Matt and Pankaj both noted, our customers trust us because we deliver every single time. Reliability at 99.99% and 94% of transactions delivered in less than an hour from our platform. And our integrated solution with payments, wallets, invoicing and recurring payouts, what that means is small businesses can focus on running their operations and not have to manage this complexity.

In the broader market, there are providers that offer strong rates or multicurrency wallets and others that cater to freelancers or larger enterprises. But none of them combine global emerging market reach, consumer simple design and enterprise-grade trust the way we do. Many platforms still require prefunding an account, lengthy onboarding or complex API-heavy setups.

We are building something different, a payment experience where a small business or a freelancer can send or receive funds instantly, often with just a simple payment link and without requiring the other party to create an account. Plus, we bring something few others can't, broad payout flexibility options where these businesses can send to mobile wallets, cash pickup locations or bank accounts in over 170 countries. That last mile advantage inherited from our money movement network gives us reach others simply cannot match.

The early success of this offering has been super encouraging, a shout out to our Remitly business team, a small and mighty team that has driven these results in 2025. We already have more than 10,000 active business customers, representing a small fraction of that $20 trillion opportunity, but growing really, really fast. These customers transact twice as often and send twice the transaction size of our core customers and have a much higher lifetime value than our core customers as well. This isn't a future vision for small businesses. This is happening now, and we're super excited to see where that number goes next year.

Let's take a look next at one of Remitly's largest untapped opportunities, our millions of receivers. Historically, these have been passive customers, typically waiting for funds to arrive. Over the years, we've built deep reach, millions of these receiver profiles with verified e-mails, phone numbers and brand trust. Unlike legacy and off-line players, we have the digital connection to engage them directly.

Until now, we've never really fully activated the space. But today, we're using that data, those relationships and that awareness to bring receivers into our platform, not just as recipients, but as customers. With our new capabilities, you'll see here in a second, they become active participants in the Remitly ecosystem. Let's see what that looks like in action.

[Presentation]

Let's take a look at the opportunity here a little bit more broadly. Freelancers, gig workers and families will be able to receive hold, receive, hold and manage funds, powered by stablecoins and our network. On the receive side, we're starting with freelancers. These are people earning globally and living locally, designers in Manila, developers in Bangalore, content creators in Mexico City. They don't just receive payments, they manage income, convert currencies and spend, and Remitly is uniquely built to serve them.

A focus on freelancers in particular, opens a massive new growth opportunity, extending our platform from senders to earners and from remittances to the global digital economy, unlocking a new category of customers. We launched our freelancers product in Q4, an additional step in serving the receive side of small and micro businesses globally. This freelancer opportunity alone is enormous, over 1.5 billion freelancers across the globe, contributing over $2.5 trillion in the global economy. Their pain points are super clear, late payments, high fees and limited ways to access funds.

When we talk to them, we've got to know 85% of them get paid late and many lose over 5% to 10% in fees or bad FX rates. Remitly fixes that with fast, affordable and reliable cross-border payments. Clients can pay a freelancer through a simple payment link, no sign-up needed, and the freelancers can receive in hours, not weeks. We also plan to enable similar functionality for our consumer receivers as well coming in 2026.

With our multicurrency wallet, receivers will be able to request funds from anywhere, convert between currencies instantly and hold stable value. They will be able to withdraw locally using Remitly's trusted network, unlocking empowerment and flexibility in 80-plus countries. This is a huge opportunity for Remitly. Turning these receivers across our consumer category and freelancers could increase our base to three to fivefold. Our goal is simple: make getting paid globally as easy as getting paid locally.

Moving to new products. So we'll cover our product lines now, starting with liquidity and credit, which is our focus on enabling credit access for the credit invisible. Note that the customers we target at Remitly are typically banked since they pay in with methods like a bank account or a debit card. Millions of Remitly's customers have steady income but have no formal credit history, inhibiting their ability to get credit access when they needed the most. We're changing that by using this transaction data, their past history with us to unlock fair and transparent financial access.

Let's look at how our liquidity product, Remitly Flex, works in action, enabling a customer to send now even when access to liquid funds can be challenging and also how it helps them even more when paired up with their Remitly One membership.

[Presentation]

Let's dig in a bit at the customer opportunity here. If you look at existing Remitly customers, about 1/3 of those customers have no credit bureau record and 1/4 of them have queried for costly short-term alternatives. Through Remitly and our Flex product suite, they can gain access to affordable liquidity when they most need it. And as we launch our credit product, establish their credit history with every transfer, enabling a better pathway for them to ascend in their financial lives.

We launched Remitly Flex, a no-interest send now, pay later product for trusted senders just this past year. Note that this product is offered by invitation only, only to those with demonstrated remittance history, helping us mitigate risk. Flex has specific benefits for Remitly One members who pay a monthly fee and get no fee instant access to fund transfers and have up to 90 days to repay their balances.

Nonmembers have 30 days, but are required to wait 3 days for funds availability or pay a fee for sending instantly. Early next year, we'll enable Flex users to get a bank-sponsored credit product that also allows them to establish credit history by just doing their payments with Remitly. These products create new revenue streams while deepening loyalty and engagement. We're not just moving money. We're moving the financial progress for these customers.

Early adoption of Flex validates a very strong product market fit. As you can see, Flex has achieved over 120,000 active users, and that's about 12% of our active base. These customers also send 30% more than average. These are our core customers who are not using Flex and are adopting our membership products at a faster rate. Vikas will provide more detail on the unit economics of a Remitly Flex customer with a Remitly One membership, which is expected to provide a higher net take rate than our remittance product.

Now let's talk about wallet and card. This, in my mind, is the foundation of how we become a trusted financial partner for our customers. These products enable customers to store, save and spend money globally. It's the bridge from sending money to living globally with financial freedom. Here's what the wallet and card experience looks like in action, convenient, global and built on trust.

[Presentation]

Let's take a step back from the demo and look at the market opportunity here. The opportunity for these products is massive. There are over 100 million high-income senders with the need for these services our wallet and card provide. Nearly 50% of Remitly send volume comes from customers sending more than $1,000, as you heard from Pankaj. With Remitly Wallet, these customers can hold and convert stable value.

With the Remitly Card, they can spend globally. Our wallet and card are uniquely well suited to address common pain points for our high amount senders. Many existing solutions can be cumbersome, often requiring extensive documentation to set up digital wallets and apply for a debit card. Our solution leverages Remitly's streamlined KYC processes to sign up customers quickly and effortlessly. Many competitive products when used across borders for send and spend scenarios end up with a lot more costs for our customers coming from fees and charges. Our wallet and card helps save on them with the integrated wallet and card benefits, allowing these customers to send, spend and earn better.

Finally, most of our customers' financial livelihoods reside in multiple locations, requiring painful layers of friction. Our wallet in card will create a unified multicurrency solution, allowing easy access to funds when and where our customers need it. This creates a trusted financial partner for the millions who live and work across borders. Remitly Wallet is currently live in the U.S., allowing customers to load, store and soon receive direct deposits.

The card now in testing connects this wallet to the world, virtual today, physical next year. These create new interest and interchange revenues and deepen daily engagement with our customers. Remitly One members get special benefits with our wallet and card, boost rewards on balances and cash back on spend. The early traction on this product has been super encouraging, over 40,000 accounts created thus far, focused on high amount senders.

Note that this product was launched earlier in July, so the traction for these customers has been super strong. These users transfer 75% more on then average and hold balances that generate recurring revenue for us. It is early proof, early, but really, really good solid proof that Remitly can become a global financial partner for these customers.

Now let's bring it all together with Remitly One, our membership and loyalty offering. It ties our products into a unified experience that rewards engagement and builds daily habits. Members stay longer, use more products and get more value with each interaction. It truly has been a membership built for global life. Remitly One is expected to appeal to all of our customers over time with certain features and product sets appealing uniquely to low and high amount senders, respectively.

Members enjoy instant funding through Flex, cash back with our card, Boost rewards on wallet balances and the ability to get credit and establish credit history coming early next year. We've launched Remitly One in the U.S., as you saw at our Remitly Reimagine event, and we'll start testing it internationally next year. Remitly One already has over 100,000 active members. Now take a step back and think about it. We broadly announced this product at Remitly Reimagine, and we can already see over 100,000 active members using the product and providing us recurring revenue.

We also know that membership drives higher retention, higher multiproduct adoption and this predictable recurring revenue. This is how we build lifelong customer relationships, deepening their emotional connection with Remitly's brand.

Now let's take a step back and talk about enablers. All of this innovation we talked about, new products, new customer categories, everything we do is powered by 2 foundational enablers at Remitly, AI and stablecoins. These are not future bets. These are operational realities that give us structural advantage.

Let's look at how they're reshaping both our experiences as well as our economics. Let's talk about AI first. AI is not an exploration at Remitly. It's live, scaled and driving measurable return. Our AI virtual assistant, as you heard from Matt, now resolves 1/3 of all chat contacts and does so 4x faster than humans with equal or better customer satisfaction rates. And we're just getting started on this one.

Next comes voice AI support and ecosystem integration with platforms like ChatGPT. Agentic AI overall is quickly becoming a core growth lever for Remitly, automating support and using the same platform to accelerate onboarding and driving customer retention at scale. As an example, for Remitly on WhatsApp, our monthly active users have grown significantly for our off-line prospects converting to online customers. This AI-driven onboarding has so far delivered 3x higher sign-up rates and 42% better conversions than on the web where we historically engaged these off-line prospects.

What's even more exciting is how these customers use the product. 74% of these customers complete a transaction within WhatsApp, whether that's sending, checking rates or getting updates. This shows real customer traction. AI is not just handling support, it's creating conversion and retention loops. Let's take a look at AI in action, serving customers instantly in their channel of choice.

[Presentation]

I personally love this experience. And if anybody of you want to try it out, I'm happy to use my phone and show you around after these demos are done. This is how I send money to my mom back in India when I have to send her money every month. Repeat sends in WhatsApp are seamless and easy to do. No app download required.

Let's talk about stablecoins. Stablecoins for Remitly have quietly become an important part of how we move money and then manage liquidity. There are 3 examples of use cases we'll talk about. On the treasury side, we've begun using stablecoins to fund currencies that make up 15% of our prefunding, allowing near instant global settlement with 24/7 access, reducing the amount of working capital locked up. This has driven an incremental improvement in FX spreads in one of our key markets over the last 2 quarters compared to the best available fiat pricing from our trading partners.

We expect this to get better as the liquidity pools for stablecoins evolves in many markets. On the network side, stablecoin rails expand customer choice by enabling disbursements not only in local fiat but also in USD-backed stablecoins, giving customers more flexibility in how they receive and hold value. At the same time, we're leveraging stablecoins within our FX and treasury operations to reduce the underlying cost of money movement, savings that improve our unit economics and allowing us to pass these towards customers.

On the wallet side, we've launched in the U.S. and are currently working on expanding this to 80-plus countries, enabling customers to hold and move stable currencies seamlessly. Altogether, stablecoins are strengthening our financial foundation, lowering cost, improving FX economics and extending 24/7 liquidity to customers around the world. Much like how we created the world's best network for digital and physical money movement, we're now doing the same with fiat and stablecoins.

Bringing it all together, our strategy connects customers and products through one intelligent Remitly platform. We're scaling faster, launching more products and expanding margins. AI and stablecoins power efficiency. Our trust with customers powers growth. This is Remitly's evolution from remittances to a true financial partner. This visual brings everything full circle, customers, products and our platform unified in a way that drives immense value for customers around the globe.

Every node here is alive with real customers, real products powered by a real platform. And finally, this rail captures 2025's momentum and what comes next in 2026. We're executing with speed, precision and purpose, transforming lives with trusted financial services that transcend borders.

[Presentation]

I will now hand it over to Vikas who's been a phenomenal partner as we've launched and scaled these products. Thank you, Vikas.

Thank you very much. First of all, it's amazing to see the breakthrough innovations, and I want to thank Ankur, the product and engineering team for delivering outstanding innovation. It's great to see you all for our first Investor Day at Remitly.

And over the last 90 minutes, you have heard Matt talk about how we have evolved into a global financial services company and built on our vision. You've heard Pankaj talk about how we continue to gain share and redefine the consumer cross-border payments market. And more recently, you heard Ankur show exciting innovation. The demos and presentation capture the passion our teams put in creating differentiated customer experience.

So now, in the next 30 minutes, I'll describe four key things. First is what really drives our powerful business model. Second, I'll reflect on what's top of mind for you. Third, I'll highlight our strong track record and essentially what creates a solid foundation for us to continue to deliver in the future. And finally, I'll share our medium-term outlook and the key drivers and levers of that.

And by the end of the presentation, I'm hopeful to make one simple point. As we deliver great customer experience, we will also deliver outstanding shareholder value. This is what our business model is all about. So, let's dive in.

Let me start with our business model. There are three key pillars that drive our powerful business model, starting with massive growth opportunity. Matt highlighted we don't have shortage of growth opportunities, and we are in the early innings of this massive trajectory. The second is our compelling unit economics. We have a flywheel motion and with scale, we can drive long-term margin expansion. And finally, we are disciplined with our capital allocation. We are hyper focused on how every single dollar is spent and we get the highest ROI for that. These three pillars ultimately drive adjusted free cash flow per share that compounds over the long term.

This is the financial equation and the algorithm, and it is as simple as that. So, let me unpack it further. Adjusted free cash flow per share, as Matt shared, is the framework we use to assess our business performance.

Let me simplify this further for you. It starts with growth, and it is focused around driving sustainable, durable long-term revenue growth with our robust core business; secondly, with expansion in our customer categories; and finally, continued expansion of new products. At the same time, we are very disciplined about how we operate. We continue to reduce cost to serve, which drives higher RLTE dollars and the growth thereof.

We stay efficient and disciplined in managing our operating expenses, including our stock-based expenses and compensation. In our industry, it is also very critical that we manage working capital very diligently. This combination gives us a model that drives incremental operating margins, resulting in strong free cash flows as we scale.

We are also very thoughtful with our capital allocation. Managing dilution is very critical to drive adjusted free cash flow per share. This is now the North Star metric for us as a management team.

And in the following slides, I'll illustrate how the components of the equation have come together and how this growth algorithm will continue to drive outsized shareholder returns going forward. But before I do that, let me talk about what's really important for you and reflecting on the key themes.

As we prepared for this event, we talked to several of you, both from the sell side as well as the buy side. And we heard your feedback, questions as well as inputs. And four key themes came across. It started with growth and the durability thereof. Second, it was about profitability and the ability to continue to expand our margins. Third, it was about stablecoins. And fourth, it was around dilution.

And this is what was really highlighted across the presentations that you have seen with Matt, Pankaj and Ankur highlighting how our growth is durable, how we are building a multi-platform, multiproduct portfolio and how our growth is product-led and enabled with strategic marketing.

In the next few slides, I'll show exactly how it manifests in our financials and our future outlook. So with that, let me jump into our first most important lever that is our strong growth. You can see here our stellar track record of delivering durable and sustainable growth. Over the past 5 years, our business has scaled meaningfully, starting on the left with our send volume. Send volume has increased nearly 6x from roughly $12 billion now to $70 billion, reflecting both expanding footprint of our global network and at the same time, the trust that we have built with the customers who rely on Remitly for speed, reliability and transparency in every transaction.

Along with that, our revenue has also grown 6x over the same period from around $250 million to over $1.5 billion now. This has been driven by consistent customer demand, which most importantly has been fueled by superior customer experience. And this superior customer experience translates into sustainable growth in quarterly active users as well as increasing send per active customer.

As you can see here, our quarterly active customers over time have grown 5x since 2020, demonstrating the breadth and depth of our engagement with our customer base and our ability to acquire new senders at a healthy pace. In addition to that, the engagement has been deep and solid. As you can see, our send volume per active customer has also expanded over time. And more recently, we are at record highs. That has been driven by increasing send limits, greater traction with high amount senders and strong repeat usage, a lot of what was reinforced by Pankaj earlier.

This speaks to enduring relevance of our product, and it's also how we are thinking about building the strong foundation going forward. This all comes through with a strong product-led approach to innovation.

Remitly is a technology company. Our extensible platform positions us to serve a diverse set of customers all the way from low amount senders, high amount senders, businesses as well as receivers. That product-led approach is what allowed us to scale so quickly in the core cross-border payments market and establish a foundation for trust for millions of customers.

Now we are building on that foundation into a digital financial services company through Remitly Business, Remitly One, and that is along with that, strengthened by stablecoins as well as Agentic AI. This is what I mean when I say that Remitly is a company that has been led with product innovation.

Along with that, marketing is a critical driver, and it has been a strategic enabler. If you look at our marketing as a percentage of revenue, that has continued to leverage from 26% in 2021 to just over 20% now on a last 12-month basis as our business has grown meaningfully over that time. In addition to that, even if you look on a per customer basis, our marketing spend per active user has declined at a consistent rate. And if you calculate that, that's 4% annual rate, reflecting better efficiency in both acquisition and retention. It's a great example of how the combination of a product-led marketing -- product-led engine as well as marketing discipline work hand-in-hand, driving durable, efficient growth and increasing customer lifetime value over time.

Now moving to the next question. We get this question a lot. which is, is cross-border payment a commodity business or a differentiated business? And I want to address that head on. First of all, as you look at these two views, I wanted to clear a few misperceptions. The first one is with regards to take rate. It's conceived that, "hey, if take rates are going down, it's a bad thing. Is it a bad signal?"

And I wanted to highlight a few things. The first is that take rate is a function of mix and is not a great metric to analyze our business. The mix is across pay-in, payout, geographies or transaction sizes. We believe that our LTE dollar growth or our LTE per active user is a much better metric to analyze our performance. And I'll demonstrate it with a little bit of an illustration and an example. If you think about our transaction sizes, if you take transactions that are below $500 with a gross take rate approximately of 3%, you have transactions between $500 to $1,000 with approximate gross take rate of 2% or $1,000 to $10,000 cohort with a gross take rate of 1%. Further, as we expand $10,000 and above, the gross take rate goes below to 0.5%.

If you take this as a scenario and think about the two extremes, starting with the $500 transaction at a gross take rate of 3%, that is $15 in revenue. On the other hand, a $10,000 customer with 0.5% take rate is $50 in revenue. That is 3x more revenue with a take rate that is 6x lower. And that is the reason why we deeply care about RLTE dollar growth and not gross take rate.

Now let me help you understand the second point, why we think this business is a differentiated business. This goes back to where Matt shared the core strengths. It starts with trust, network and scale. These are not replicable overnight. And this is what creates differentiation.

In addition to that, what Pankaj highlighted as our superpowers, analytics, data-driven approach to thinking, customer first and the customer lifetime value as well as CAC equation that you have to drive with a meaningful focus, optimizing that with every turn. These trends allow us to outcompete peers, continually optimizing pricing by corridor, ensuring we deliver great value to customers. Further, as Ankur showcased, our product solidifies differentiation through adopting newer technologies like Agentic AI and stablecoins.

That's a great segue to talk about the other top question that you have, which is around stablecoin and how that impacts economics for Remitly.

Let me start with one clear statement, and that is stablecoins are a secular trend favoring our business. This trend is captured across treasury and network operations as well as customer-facing perspective from a wallet standpoint.

Let's take the Treasury and Network operations. Ankur highlighted a few thoughts there. While still early and capped by limited liquidity pools, our initial stablecoin trades in some key corridors have successfully lowered foreign exchange-related costs. We have a great track record of delivering network efficiency over time. As you can see over here, our transaction expense, excluding losses, has steadily come down every single year and are less than 29% over the last 12 months. Stablecoins will enable us to continue to drive leverage here.

Moving to the next point around the value for wallet. It creates value both for the customer as well as for Remitly. Stablecoins help our customers save money in a currency as well as a value, which creates a hedge essentially against any foreign exchange volatility.

For Remitly, it opens up new ways to serve our customers, enabling stablecoin balances, float revenue, interchange, et cetera. In short, stablecoin enhance our platform economics and deepen customer engagement and is a win-win that strengthens the foundation of our long-term growth as well as economics.

Now moving to the profitability side of the equation. As I shared, we have a strong growth trajectory. We have secular trends like Agentic AI and stablecoin helping us. But beyond that, we are hyper focused on driving operating margin discipline.

If you look at it, margin expansion has been across each line item. And that just doesn't happen by chance. It's the result of our diligence and very thoughtful approach across every single line. And that translates because of disciplined hiring, increasing AI fluency, using automation tools, prioritizing strategic investments and ensuring every dollar that we spend drives durable profitable growth.

Now this is what becomes the output of all those amazing things that we have been doing. As you can see, our Revenue Less Transaction Expense is now over $1 billion and has grown more than 6x since 2020, reflecting both volume growth and continued optimization of our economics.

Adjusted EBITDA has similarly scaled over time. And from a negative margin of 8% in 2020, we are at 15% over the last 12 months. This steady margin expansion is the outcome of our powerful business model that combines product-led growth and disciplined pricing and marketing, all working together to drive efficient, durable financial performance.

Now it all comes back to free cash flow per share. This is the equation that we are solving for. As you can see, managing dilution is equally important part of that equation, and we have been hyper focused on that. You can see the impact of our actions to control dilution. Stock-based compensation as a percentage of revenue has steadily declined from around 15% in 2023 to just over 10% on a trailing 12-month basis. That's a meaningful step down and a reflection of a more disciplined approach to equity usage. Similarly, dilution and net burn rate have also had steep declines.

These results are not by accident. This is a product of intentional decisions, all the way from disciplined hiring, offering cash in lieu of equity for new hires and a leadership team that has demonstrated commitment with our CEO declining New Equity Awards for 3 consecutive years.

That's what translates into adjusted free cash flows. This is my favorite view by far. This is what shows how consistent improvement in every aspect of the business drives great results. And you can see here our adjusted free cash flows have gone from negative $16 million in FY '20 to $214 million on a trailing 12-month basis. That's a compounded growth rate of 77% annually and reflects both operating leverage and disciplined investment decisions.

Let me pause here and reflect again. That's a 77% compounded annual growth rate in our adjusted free cash flows. And while you compare it against the share count, which has only modestly grown at 7%, that combination creates compounded free cash flow per share over the long term in a very meaningful way. This is the power of our business model with massive growth, compelling unit economics and disciplined capital allocation. And that is what differentiates us.

So, if you bring all of this together, how do we compare with the rest of the world? We feel really good about our growth, profitability and free cash flow. And as you look at top 1,700 technology and financial companies that are public and look back over the last 12 months and filter for companies that have delivered north of $1.5 billion in revenue, have grown north of 30% have EBITDA margins of north of 10%. We are at 14.8%. We could have chosen 15%, but we chose 10%. And our GAAP profitable, you get 24 companies from a universe of 1,700 companies. That is less than 1.5%. We are in top 1.5% of the overall space, which gives us a lot of pride, but at the same time, we are not resting on our laurels. We are relentlessly building on this foundation to create an even stronger future.

Let me talk about future now. As you have looked at our impressive track record, the drivers for growth and profit expansions continue to be solid.

Let me share with you our plans for the future to continue to deliver shareholder value as well as share our medium-term outlook. But before that, I want to share what really is underpinning that medium-term outlook and what gives us that conviction.

Let's start with our massive growth opportunity. As we look into the future, we believe we can deliver sustained long-term growth from four main levels. As you can see over here, Matt, Pankaj, Ankur shared a lot of these, and I'll bring it all together.

Matt shared, we started in low amount sender category and have expanded successfully into high amount senders. We still see a lot of headroom in both these categories. Next year, the remittance tax for cash pay-in will create an opportunity to win share in low amount senders. And with product enhancement, higher send limits and focused marketing, we believe we'll continue to win share in high amount senders.

From a geographic perspective, while we still have a lot of growth left in our existing 5,300 corridors, we are excited about the potential to unlock key new regions. In addition to that, what Pankaj shared was very interesting. We have less than 50% of top 50 sender countries currently, and we'll continue to expand our send markets with imminent plans in the Middle East.

Third, we are expanding into new customer categories, like Remitly Business, receivers, and we are unlocking new use cases as well as new ways of monetization.

The fourth one, as Pankaj as well as Ankur highlighted, we are introducing new services and products like Remitly One, Remitly Liquidity with regards to credit card products, et cetera. These create newer use cases, unlock broader total addressable market as well as create deeper relationship with our customers.

Let me now jump into the profitability part of it and how the compelling unit economics create a nice combination with the massive growth opportunity. As I've shared before, Revenue Less Transaction Expense is one of the best metrics to analyze our business and Revenue Less Transaction Expense per user is the best gauge to analyze the monetization of new products. We see a meaningful opportunity to expand Revenue Less Transaction Expense per user further.

As I explained just a few minutes before, as you think about high amount senders, that's a great opportunity for us to further expand our RLTE per user. As customers adopt more products from our ecosystem, the monetization will naturally deepen. And we expect, over time, all of our new product offerings to be accretive to Revenue Less Transaction Expense per active user.

The multiproduct adoption is what drives our path forward towards a sustained growth in Revenue Less Transaction Expense per user over time. An additional benefit that we get with this ecosystem of products is the flywheel, as Matt explained, which increases retention as well as creates a reinforcing circle for us.

One such great example is Flex. In the next slide, I'll explain with a concrete example how this is accretive to our business from a revenue less transaction expense perspective. So, let's jump into the example on the unit economics for Flex. Before I jump in, I want to create a small bridge explaining net take rate as well as Revenue Less Transaction Expense and how they are significantly similar in the way we think about it. So, the definition of net take rate is pretty simple. It is Revenue Less Transaction Expense divided by send volume.

So, if you now unpack the Flex unit economics, there are a lot of similar variables to our core consumer cross-border payment business. Revenue is earned both from membership as well as from cross-border transactions. Direct expenses include transaction fees. At the same time, there are Flex-related variable expenses, provision for losses as well as notional cost of capital. Netting these expenses to the revenue, you get Flex contribution profit. And if you divide that Flex contribution profit with the send volume, you get net take rate.

So in this example, as you can see, we are taking an example of a user who, on a monthly basis, takes an advance of $150 and repays it back. As you can see over time, for the full year, this drives a revenue of $159. And after factoring all the costs I highlighted, you get $112 as contribution profit per member at the end of the year. That's a meaningful increase in the net take rate, which is over 6% and compares really favorably compared to our core consumer net take rate, which is approximately 1.5%.

Even if you factor churn and provision for losses, which have been in line with expectations thus far, our expectation for Flex net take rate is to be at least double. In addition to that, we are very thoughtful in how we roll this. As Ankur explained, this is a gated product, and we are very thoughtful in whom we provide this facility to. In addition, the short-term repayment cycles, the recurring usage patterns create a strong feedback loop for managing risk efficiently. As we execute on new products, this gives us great confidence and conviction. And over the next few slides, I'll share how that translates into our near-term and medium-term outlook.

Now let me share our 2026 early outlook. Starts with revenue. We continue to expect high teens revenue growth. Revenue growth is expected to be driven by continued strength in core remittance business and growth from new products. In addition to that, today, we are issuing an outlook for adjusted EBITDA in 2026 in the range of $300 million to $320 million. And at midpoint of the range, this translates into a margin expansion of approximately 150 basis points and a 30% year-over-year growth in EBITDA. We will balance growth, profitability and investments into new products and customer categories.

That leads us to the medium-term outlook. As you look forward, we are super excited to share the medium-term outlook. And the reason is that our confidence both in the durability of our growth and profitability, which is scaled through our business model continues to be embedded in very clear levers. As I've shared before, we have a balanced approach to growth, profitability and investments.

Looking forward, we are aiming for a Rule of 40 framework. That means CAGR for next 3 years of growth, revenue growth as well as the 2028 EBITDA margin will total at least 40%.

Now let me unpack that further. On top line, we are aiming for $2.6 billion to $3 billion in revenue in 2028. The range is largely associated with growth in new products, which we expect to comprise between 5% and 10% of total revenue by 2028. Importantly, while we drive strong revenue growth, we also see meaningful opportunities to expand adjusted EBITDA margins. By 2028, we expect 20% to 22% adjusted EBITDA margin, resulting in $575 million to $600 million of adjusted EBITDA.

To achieve these outcomes, we will drive incremental adjusted EBITDA margins of approximately 30% over the course of next 3 years, inclusive of investment in new products. Overall, we remain focused on profitable growth and delivering the Rule of 40 framework. So. Let me unpack that a little further.

So we have outlined the medium-term margin aspirations. And as I look at all the key line items, we feel very strongly that through leveraging our strong foundation as well as leveraging AI and stablecoin-related benefits, disciplined global hiring as well as marketing leverage over time through word of mouth, we will continue to drive adjusted EBITDA margin expansion.

As I think about Revenue Less Transaction Expense, I went in a lot of detail about how we think about the new products and how they will be accretive. But beyond that, I feel stablecoins will further help us leverage. Our transaction loss in that segment, as you know, is always range bound, and we think that it will be between the 9 and 13 basis points, as we have shared before.

As you look at technology and development, that again benefits with all the technology trends, including Agentic AI. We'll continue to be disciplined in our hiring. At the same time, we will invest for future growth. Beyond that, customer support, marketing, G&A will continue to leverage as we invest in technologies that help automation as well as be disciplined with our hiring approach. So overall, we remain very, very confident and convicted about our adjusted EBITDA margin expansion over 2028 and beyond that.

Along with adjusted EBITDA margins, it's important to drive disciplined capital allocation. As we scale the business, expand margins, we are equally focused on ensuring that our growth translates into shareholder value. A key part of the discipline is how we manage dilution.

Looking ahead, we expect to maintain the trajectory and bring stock-based compensation as a percentage of revenue down further in the range of 7% to 10% as a percentage of revenue over the next 3 years.

Together, these commitments ensure that as Remitly grows profitably and scales, we do so in a way that minimizes dilution and enhances long-term shareholder value. That brings us back to where we started. Everything we have shared today from sustainable long-term revenue growth, margin expansion and disciplined investment approach comes back to our North Star metric, adjusted free cash flow per share.

In addition to the medium-term outlook on EBITDA, the limited working capital needs and low CapEx that is part and parcel of our business helps us drive adjusted EBITDA conversion into free cash flow approximately at 80% range over the medium term. The focus on managing dilution further drives compounding adjusted free cash flow growth over time. This is what makes Remitly's business model powerful. We are driving top line growth, profitability and doing it in a way that compounds shareholder returns over the long term.

So this brings us to the end essentially, and I wanted to reinforce the powerful business model that we have. We are in the early innings of a massive growth opportunity. We have unit economics that are compelling, which further get reinforced with scale. And finally, we are hyper focused on managing dilution and have disciplined capital allocation approach.

Goes back to the simple point I made earlier, as we deliver great value to our customers, we will also deliver outstanding value for our shareholders. And we are just getting started.

I'll now turn it back to Matt to wrap things up.

That was incredible. Thank you, Vikas, Pankaj and Ankur, incredible job. That was wonderful. Before we close, a brief personal note to reinforce my excitement of what lies ahead.

As many of you know, I'm not just the Co-Founder and CEO, I am also a very significant shareholder, like many of you. I currently own approximately 5 million shares, about 20% of which I acquired through option exercises just this year, but held those shares. I intend to remain a long-term owner.

And while I had a 10b5-1 plan in place to sell shares in 2025, I no longer have one in place, and I have no plans to sell shares for the foreseeable future. The strategy and projections we shared today gives me strong conviction that we can deliver meaningful customer impact and outsized financial returns. We have clear line of sight to $3 billion in revenue by 2028 and a path to significantly higher adjusted EBITDA margins.

In short, I am incredibly proud of what the team has built, I'm invested in our future, and I'm excited about what comes next.

So with that, we will take a 10-minute break, and then we'll be back to take your questions. Thanks.

All right. We'll get start with Q&A in just a minute here. We got everyone. All right. Welcome back. We now have the entire team on stage to take your questions.

Before we dive in, let me introduce two additional members of our executive leadership team joining us, Saema Somalya, our Chief Legal and Corporate Affairs Officer; and Ronit Peled, our Chief People Officer.

Now for those in the room, we ask that you do limit yourself to one question at a time to make sure that everyone has a chance to ask a question. And for those listening online, we will be taking questions through the app. If you are listening via webcast, please feel free to submit a question through the webcast interface, and we'll do our best to answer as many questions as we can.

After the Q&A session for those in the room, we'll be hosting a networking session with management afterwards. So please, do stick around.

All right. With that, we will begin the Q&A session. Ramsey?

Ramsey El-Assal from Cantor. Thanks so much for a super informative presentation. Really appreciate it. I wanted to ask about stablecoin demand. I think your kind of role in that value chain is potentially quite interesting. What are you seeing out there in the field in terms of demand? Are your customers looking to hold stablecoins? Is that something that you're sort of sensing? Is it more of a demand to pull program? Does that make sense?

Yes. Yes. Thanks, Ramsey. And it's great to see you. I'll start and then let Ankur add anything he has. I think it's still early days when it comes to stablecoin demand and adoption. I think we're on the cutting edge in terms of leading that. And I think we have big opportunities, as I mentioned, on the Remitly wallet side, given the network that we have, given the fact that we have 20 million recipients. But I think that like most consumer financial technologies, it comes down to trust, and that has an adoption curve of its own. So that's on the consumer side.

And then I think on the Network and Treasury side, a lot of it is about liquidity, and the liquidity is still pretty limited. But again, we're investing in that so we can be at the forefront if and when some of that materializes.

Anything you'd add, Ankur?

I would say I'd draw it back to the analogy in terms of just like we've built, in my mind, the world's best network for physical and digital money movement, whether that's digital wallet payout, bank account payout or cash pickup applications or home delivery. We're doing the same thing with fiat and stablecoins. We started with that partner-first approach. So we do partner with the majority of the stablecoin providers and seeing where that drives customer value externally to the wallet use case Matt talked about. And then internally with that treasury, where we've done the integration. So as liquidity pools evolve, we'll start to see more and more of that benefit.

I just wanted to ask on the guide. So particularly when we're looking at '26, you're talking about that high teens number. And on a CAGR basis, it does imply some form of acceleration off of that. So can you provide a little bit of context about what gives you the confidence in that? Is it new products? Is it some of those new geographies coming online? Just any additional context there.

Yes. Zach, thank you for the question. And our confidence and conviction in 2028 comes from the new products, right? So first, our core business continues to remain very strong and healthy. And as we look forward, all the different levers we talk today, whether it's geographic expansion, new customer categories as well as, sort of, moving into the new products, whether it's liquidity and credit or savings or cards, that will continue to drive that growth.

If you think about even the current traction that we have had thus far, we are seeing really good early signals. And that is what is really helping us be much more convicted. So if you take, as Ankur was highlighting earlier, Remitly One or take Flex, we have more than 100,000 active users, which is a recurring form of revenue with membership. Now that's very durable. That's a sustainable trend.

The second, if you take Remitly Business, we have more than 10,000 businesses already on the platform. And we know that the customer lifetime value and the economics for that use case is very, very strong.

Behind the scenes, as Ankur shared, Wallet is now selectively live, and we are rolling it out and the early signals, again, are very powerful. So overall, we feel that the underlying core business strength is solid. And on top of that, as we continue to add new products and drive the momentum there, that should materially have a strong impact. And to size that further, that's why we gave the 5% to 10% range. So, as you think about 2028 revenue range we gave, which was $2.6 billion to $3 billion, we believe that we will have 5% to 10% of the contribution of that coming from new products. So again, early signs are really solid, gives us a lot of conviction.

Great. If you don't mind, I'll ask a clarification and a question. So Mike, a quick clarification -- good presentation, by the way, very clear and direct. My clarification question is first, with the move towards high send -- senders -- high dollar senders as well as for credit and liquidity, you will take on more risk naturally as part of the business. So, appetite for transaction losses and there's always a trade-off between loss and growth. So, tell us what the framework is on that.

And then just my main question, maybe for Matt. I know we've talked about this, but I want to hear it from you based on the presentation. Thinking about your right to win in financial services and you're rooted in remittances, as you talked about the founding. Can you talk about why that's an advantage versus the competition that's doing it from different routes? Like you have domestic P2P, I think Walmart was here, they're talking about OnePay and they're using commerce as a chance to build off of that. Of course, you've got other BNPL providers are also doing banking as well. So just tell us what that -- what the pros and cons are for being a remittance company, if that's okay.

Yes. Yes, great questions on both fronts. And, Tien-Tsin, and I'll start. I think on the risk front, I think that with high amount senders, it's important to contextualize the chart that Pankaj showed, which is over 50% of our volume is already from high amount senders, as defined by over $1,000. So that is a continuation. That's one of the things we wanted to communicate today, because I think that, that is very much a continuation of a journey that we've been on. I wouldn't expect material changes in terms of our risk exposure or approach to that.

And then with our Send now, pay later, Flex and credit products, I think that we have already proven and will continue to prove that we are prudent risk managers. And we're taking a very -- talking about the focus point I made earlier, very focused intentional approach to ramping up that business. And as Vikas mentioned, we have in our control who we invite into that. We have remittance data to be able to do the underwriting. It's only getting better as we continue to refine that. And we feel really good about that area.

And then, it's actually a good segue to the competitive dynamics. Because we -- as I mentioned, that last part of the vision, financial services that transcend borders. We believe that the 300 million individuals and 80 million businesses that have cross-border needs, very few to no companies have really approached it from how do you solve their needs first and then go deeper where required and where adjacent to their cross-border needs.

So, Send now, pay later is a good example in the sense that we're not going into mortgages. We're not going into like domestic lending. We have no right to win in that space. We are focused on a Send now, pay later product that leverages remittance data to provide credit to not sub-prime, but credit invisible customers that have moved to a new country. That is financial services that transcends borders. And so, that's where we see our unique competitive advantage and why we're so excited about the vision we laid out today.

And I'll add a few financial points to that. If you think about our strategy in general, we are going into adjacencies, places where we are very, very comfortable with and where we have core strength. So, as you talk about high amount senders, the network that we have built, the customer support we have built, essentially, everything that we have built can continue to cater to the high amount senders.

And as Pankaj highlighted earlier, the LTV to CAC for high amount senders is even better than what it is for the low amount senders, right? So in fact, the economics for the high amount senders are better, right? So that's part one.

As we explained similarly for Flex, again, as Matt shared, the use case is only for sending remittances. And we have a lot of rich history. We are very measured. And if you look at that customer example, it can go all the way to 4x from a net take rate perspective. And even if you factor the provision for losses or other aspects, and we are even including notional cost of capital as a part of that, we are still double net take rate compared to our core customers. So overall, we feel risk management is at the core of everything that we do. We're very thoughtful in creating a business model that has both growth as well as profitability.

It's David Scharf at Citizens. Thanks once again for just the breadth of this presentation. A bigger picture question, Matt, whenever -- a lot of fintechs, particularly marketplace lenders throughout their evolution of ultimately taking on bank licenses, whenever I hear the term global financial services and you're talking about more lending, there's card issuing, interchange. I realize the 2028 outlook is just 5% to 10% from new products. But do you see a point at which your product mix, whether it's from a funding advantage, deposit funding or otherwise, leads you to get a bank license?

Yes. I'll start that, and then I'll turn it over to Saema to add anything. I think that our regulatory approach has been efficient in the sense that it's been more asset-light, things like getting a banking license for those that have gone through it or know is not for the faint of heart. And so, when I talk about 100 licenses, it tends to be money transmission licenses. Sometimes there's a stored value account. It's not going and getting a full banking license. And that's not currently on our road map given that I think we actually have a competitive advantage, how we think about our regulatory infrastructure, how we think about our banking partnerships, both on the origination and the receive side.

And when you look at our product road map, none of those necessitate going out and getting a banking license. So again, not currently in the road map. And if anything, I think that our regulatory approach has been a competitive advantage in terms of delivering the product that we talked about to customers. Saema, anything you'd add?

Yes. Maybe a couple of things. I mean, the first one is, it's obviously a very interesting time in financial services regulation. So, we're watching that ball really closely. And I think plus one to what you already said, Matt, I think the one additional note I would make about that is, if something like a federal payments charter were to come out, that would be something that would be of great interest, and we're watching that space closely.

That being said, I think, you all follow banks probably more closely than I do in terms of market. From my experience, and I, formerly, am from a bank. My experience is the regulatory overhead that goes with that -- the additional capabilities that go with that bank license, unless you're using those particular capacities, as Matt described, they impose a huge amount in the CCAR process, the ALCO process, like all of those risk processes that are mandated with an OCC or a Fed charter are really substantial and impose millions and millions of dollars of overhead.

So, I think being really judicious about what is the return on that investment is very top of mind for us as we think about banking charters in particular as they stand today.

This is -- I'm Raj Sharma from Texas Capital Bank. Wonderful presentation, really very clear and cogent and help me understand the business significantly well. I have several questions, but I'll ask one right now, which is, it's about profitability inflection and CapEx needs of the business. Are you at a point where you don't have to invest heavily on the platform and that you can leverage that where you are and you can grow and profitability? Also, can you talk about the CapEx needs, sort of, going forward? You didn't highlight that on your -- and then I'll pass it on.

Okay. It's a great question, and I'll start and Ankur can follow. Overall, we have a very, I'd say, CapEx-light approach to how we run our business. And this is what helps us translate a lot of our adjusted EBITDA and convert that into free cash flow. As I shared, and you can do the math for yourself, like we see at least 80% or around that range of conversion from adjusted EBITDA.

While I'm answering that question, I'll also highlight working capital is an important element in our business, and we manage that rigorously. And while we manage that, again, we feel we can convert 80%. So given the platform investments that we have made thus far, we feel really comfortable with our adjusted EBITDA outlook as well as the conversion into free cash flow.

Yes. I'll just say, I mean, the only thing that's important to watch, but also it shows in the results, if you see, as an example, that tech and dev as a percent of revenue, we did grow in '23, because we were trying to get the platform set up and foundations established so we can build new products. But you see us getting leverage in '24, '25, and we expect that leverage to continue to grow.

And second, the cost of serving part that Pankaj has covered is also a reflection of platform strength, where we've seen our cost to serve customers reduced by 44% since 2018. So that's also continued leverage from an actual transaction expense side that we expect to keep going lower.

It's Darrin Peller from Wolfe. Look, my question is more around the new products. When we think about Flex and Wallet and just overall Remitly One, the pacing that you expect to come out of that, and your plan to go to market around that. I'd love to get a little bit more color and detail on, a, what took you from 0 to, let's call it, 100,000 Remitly One users today or for that matter, 120,000 Flex, I believe? What do we expect those KPIs to look like next year, the year after and '28 in terms of the actual numbers of users as a percentage of the 8 million, 9 million you have today? And what's the plan? How are you going to make sure everyone knows this thing exists?

Yes. Yes, I'll start with that one and then turn it over to Ankur, if he has anything to add. I would say that, like I said, I think it would be -- it depends on the product, first off. And hopefully, today gave clarity of continuing to grow the cross-border payments element, there's credit and liquidity. There's multi-currency account and wallets and then all of that is in the construct of the Remitly One membership and loyalty.

And what I'd say is, we're taking an intentional approach to that. We've given the financial elements in terms of what it will look like by 2028. But as we roll that out, I mentioned that focus is a key part of our success from day 1. And so the vision is very clear. The path towards that vision, I think we're being very, very intentional about. So we can do it in the right -- with the right unit economics in the right way.

And importantly, in terms of how you get the word out, when you take a step back, it's really important to recognize that, that is focused on our existing customers. And so we -- as you think about gating like the Remitly One/Flex example that you mentioned, we're offering it to existing customers. So there's not incremental marketing expense that's material. It's about gating it and offering it to existing Remitly customers at the right time, in the right way at the right unit economics, and we're excited about continuing to do that. Anything you'd add?

I would just reiterate the adjacency and focus point, Darrin. I think the adjacency part is important, because at the point of -- if I pick on even the Remitly Business offering, when you look at that, the consumer behavior patterns are very similar to what we saw in high amount senders. So, the underlying capabilities as well as the marketing dollars you need to invest get managed based on that.

And then focus is making sure that we're picking the areas that we see that adjacency drive value. So when we see the numbers, when we see 100,000 members, we see 120,000 on Remitly Flex, we see 10,000 active businesses on Remitly Business. We look at that signal from customers, see what's working well and then drive further investment. We're able to get that growth. And then if it doesn't, reassess and drive differently based on the customer signal.

Okay. Just one very quick follow-up. Vikas, probably for you. What's the embedded assumption for active user growth over the next few years? I don't know if I saw that.

Yes. Yes. I'd probably go back to your -- the first question because probably that's how you are thinking about what's the pacing over time and how to model it. I would say that from a new product perspective, currently, less than 1% of our revenue is new product-driven. As I said, over the next 3 years, it should be between the 5% to 10%. And I would expect that to be, I'd say, evenly, but more, I'd say, second and third year would be where we would start seeing a lot of traction and upside coming from that. So that's first part of your question.

The second, from an active user perspective, I think it's very tricky, because this is where what we were trying to explain that as we shift more to high amount senders, businesses becomes very hard to then say, "how should we think about that?"

Overall, if I have to give you the view, which I'd say is reasonably consistent with how you should think about '26 as well as going out to '28, it would be starting with the first point that we expect our send per active user to continue to grow. Now clearly, as we move to business, as we move high amount senders, that should show that.

The second is we expect our volume growth to be higher than our revenue growth. Again, that's very consistent with what I shared even with that example.

And third, I would say with quarterly active users, I'd say that tracks more or less in the line or probably slightly lower than the growth in revenue. So those would be the three that I'd highlight that gives you, hopefully, a good algorithm to drive 3-year revenue growth.

Let's get a question from this side of the room.

Great. Cris Kennedy from William Blair. You mentioned the Middle East and Saudi Arabia a few times, and you've been in the UAE for a couple of years. Can you just talk about the Middle East and UAE and how that business is going, what the opportunity is?

Yes. Great question. Look, we are excited about the overall Middle East region. If I look at the overall region over there, as we expand, as you saw in my slides as well, our geo expansion strategy has been very intentional in terms of really understanding where we are strong, where we have the strengths. And when I say strength in terms of the network on the more disbursement side as well. So if you look at some of the Middle East markets, most of the action in the flows are going into the regions where we are extremely strong at from a network perspective, that's South Asia, Southeast Asia, Africa.

So from that perspective, we feel really strong about the opportunity that lies within the Middle East. And we are seeing in the UAE, right, really strong growth coming in. In fact, from an overall -- if you look at the mix on the marketing spend efficiency side, we are actually seeing much more efficient growth that is coming from the UAE market, purely because of the factor that I outlined that there is a flywheel effect that happens because of the receive side customer segment that we are serving. And there is obviously the brand that we have created, which directly serves us.

And the Kingdom of Saudi Arabia is the next opportunity for us that we are -- we feel really excited about, because the mix is also very similar, and we feel very strong about the network that we have created and the brand that we have created. So overall, good opportunity for us going forward.

I'll add a couple of points to that. Thank you, Pankaj, very well said. If you think about some of these Middle East send markets, they are in the top 5 worldwide. So it's a huge opportunity.

Second, I'd go back to what Matt shared that, we started with Philippines and then India, and then Mexico, and it takes time, right? And once you gain traction, then it's really, really solid. But it takes time. It doesn't happen overnight, and it's building trust with the customer, building the network. So, as we think about Middle East, we'll follow the same very thoughtful approach that we have always had, where we want to build a long-term strength over there. And we don't want to just, sort of, go in with -- we want to again have a product-led innovation approach to win in the market, and that's what we'll do.

We'll take a question from Mario.

Great presentation. Really enjoyed it. The amount of capital cash that the business is going to generate over the next 3 years, and we can do some calculations, there seems to be a tremendous amount of room for share repurchases. I know you have an authorization. But to some extent, if the market doesn't place a high enough valuation on the company, which right now, seemingly it doesn't really kind of buy into 2028 yet, would the company be okay sending significant amount of capital back to shareholders via repurchase?

Yes. I think that. Mario, as I shared, disciplined capital allocation is a core part of our powerful business model. And as a part of that, we are both focused on not only managing dilution, but also buybacks. Earlier in the year, we came with a $200 million authorization for buybacks. We have two simple goals. One is managing dilution. But also if there is an opportunity with a dislocated stock price, we want to be opportunistic. And our Board has been very supportive, and we have already, thus far, executed well against that authorization.

We feel that with continued strength in our business, that gives us very clear signals that we should optimize for that and definitely do the right thing, driving buybacks when that opportunity as well as dislocation happens. And I think that hopefully came through very powerfully even with Matt talking about how he perceived his investment in the company and how committed he is and the opportunity he sees that as well.

Anything you'd add, Matt?

No, I think you answered that question really well. And Mario, I just want to say thanks to you for -- you've been very helpful in terms of giving feedback across a variety of elements to the business, and we appreciate it.

I'll take a couple of questions from online before we go back to the room. So, a question from online. We've talked a lot about culture in the past as one of our unique strengths. So the question is really around how our culture is evolving as we expand into new products, new categories, particularly in light of the adoption of AI. Probably, Ronit, a question for you.

Sure. So overall, culture is a very key differentiator for us and a key advantage in the company. We have employees that are very, like, even in recent surveys, we're seeing that, very, very connected to our mission, very connected to our long-term vision, and very engaged in delivering the opportunity ahead. We also have the strong connected value of reimagine what's possible that is very -- is driving a culture of innovation, productivity and efficiency with AI. And as you heard throughout the presentation, we have every section, every leader, every function thinking how to, like, deliver faster and leaner in an innovative way to drive the best outcome for our customers.

We have employees that we're -- we encourage employees to think like long-term owners and we incentivize them to do so. And in everything that we're doing, you saw if it's in the platform, if it's in the marketing companies, if it's in the CS, of like, efficiencies, every employee is really like committed and every leader to drive that within our culture.

Great. One more from online. This one is about structural considerations internationally, particularly direct integrations, how we think about investing in direct integrations and the extent to which the infrastructure and the network we've built is a competitive advantage, specifically around the regulatory construct. So the question is really around the discipline that we engage around regulation and rules and how complex that is as we expand going forward.

Yes, I'll start that, and then I'll turn it over to either Saema or -- yes, to Saema. So, I think that, one thing over the last 14 years of building this business, when you think about that in mile or last mile in terms of distribution, there's no silver bullets. And so in some countries like Brazil, we've integrated directly with PIX. It is an amazing disbursement option in Brazil. It is the go-to. It is the go-to way to send money there. That exists with other integrations we've done and other disbursement options like UPI in India, et cetera.

But in 170 countries, it varies depending on the market. And so, what we're good at, is looking at how do customers want to receive funds in those markets. If we need to get local licensing or if we need to do a direct integration with the local payment rails like the Brazil example, then we'll do that.

But in order to get access to 5 billion bank accounts, mobile wallets and over 400,000 cash pickup locations, there has to be a country-by-country approach, and that's what we've proven that we can do well to result in things like 94% of transactions going through in less than an hour, 24 hours a day, 7 days a week.

Anything that either of you would add?

Yes. I mean I think I would add that at this point, we have a portfolio of over 100 global licenses that span dozens of countries as well as many products. And so, we feel really good about our go-to-market muscle and our ability to go in and work collaboratively with central bank regulators and policymakers across a global footprint to obtain the licenses we need, where it's the right thing for us to do for our global expansion plans.

And then also, because of the strength of that policy and regulatory relations function, maintain those licenses over time. You have probably noticed, some of our competitors have struggled with that a little bit. There have been growth restrictions and license, sort of, instability with shutoffs for some of our competitors. We're really proud of the fact that over our 10-year operating history, we haven't really had that. And so, we really credit our team's strength in those areas of working with central bank regulators, really understanding their concerns, and we've been able to maintain a smooth growth runway for the business to operate against.

Going back to the audience.

I'm Zoe Deng from KeyBanc Capital Markets. Going back to the new product offering, which ones of the new products do you expect to scale the fastest and why? And overall, the headcount needed to support the scaling and product iteration?

I can start, and Ankur, you can jump in. As we shared, we see two strong opportunities, and we have been highlighting that over the past few quarters. I'd say the first one is Remitly Business. This is where we have seen a lot of initial success. It's -- As Ankur shared, it's a similar platform that is used to enable it. It is an adjacencies. We started with our customers who are individuals that also had business needs and validated the product market fit and then further expanded that even beyond the United States to Canada and U.K. when we saw success coming from that.

From a unit economics perspective, as we highlighted earlier, we see the LTV of Remitly Business is very high. And that is because, one sender has multiple receivers and even the frequency of the send is, I'd say, one, more consistent and more frequent. So that really creates a very, very powerful business model from a Remitly Business perspective.

And Ankur highlighted all this compete differentiation, why we think that the customers choose us versus others. Again, early days, but we see huge opportunity. The incremental -- the point you made, I think Ankur will probably be much more, I'd say, clearer and deeper on that, but the incremental spend has been very minimal in terms of the engineering resources, in terms of how it was enabled, and that was the power of platform and the extensibility that was able to deliver that.

The second example I would give is Remitly One and Flex. That's the other product that we have had a lot of initial success with. And a lot of the proof points there are due to the strong team behind the scene. This is a very experienced team. They have done a credit product multiple times before. And that is also a reason why we feel good about the risk management in that business. And again, of course, we are very measured in our approach. But I'd say those two are the ones that are showing great initial success. And Ankur can share more about the resourcing side of it.

Yes, I would reiterate those two. I would say Remitly Business and Remitly One are definitely further along on the success and scaling cycle for new products. I would also say it ties into a virtuous loop, right? Because I do think as those customer categories like businesses or like the Remitly Flex offering that ties into Remitly One with low amount senders adds the ability for customers to consume more, right? So, like the businesses would want a Wallet, because the receivers would want One, right?

Or somebody who's taking money and sending would want to see the benefit of what a Wallet could provide for them. So it does create a virtuous cycle. So, we expect that to continue to grow as well.

I think on the capital allocation side, all of these investments started really small. I would say if you look at the Remitly Business team, it was small and mighty when we started earlier in the year. Same with Remitly Flex started with a really small team, because we're leveraging that platform that I spoke about and then Vikas has mentioned of that usage of the same platform capabilities allows us to build and scale these products without a lot of additional capital investment, and we expect that to continue to grow.

That's great. We'll go in the front here.

It's Gustavo from Monness, Crespi, Hardt. Thanks for putting together the presentation. So, looking at the high amount and low amount senders, it looks like an 8x versus a 5x between the two, just ballparking it, fair to think the 90-day retention is similar to that spread. I'm just going to put in all the questions now.

I imagine right now, that delta has a little to do with product density or multiproduct usage. Which customer segment do you see more attached from down the road? How are you thinking about that?

And then the last one is competitive intensity amongst the high amount senders. Why do you think there's less competitive intensity?

Maybe I'll kick off, touching upon the competitive intensity point and then Ankur can then cover the attach rates. It's a fascinating insight actually, right, when we look at the customer segmentation within that. And what we are seeing is, generally speaking, that high dollar sender category, there's much less competition. Because, if you look at kind of the wider ecosystem, hardly any banks prioritize this use case, right? And generally, these customers use that banks and very few digital scale players that we see. So, from our perspective, that's one of the reasons why the competition is low.

Secondly, if you look at this, like when somebody sends I mean, $10,000, $20,000, $50,000, trust matters a lot, right? And the strength that we have created from our network actually gives us a great opportunity because we have done the hard part, which is the building trust with that lower dollar senders and the network, the last mile connectivity that Matt also talked about across 5,300-plus corridors. So it gives a very clear opportunity for us to go upstream within that particular category of the customers.

And the third thing is the unit economics. If I look at it, we have optimized the unit economics already for the lower transfers, which is the harder part, right? Because as we bring down the transaction cost to transfer, -- so which means that, all the upside for us as we go upstream is like significant upside and within -- from a LTV perspective, and that's the reason why the LTV is also higher for us. So, we remain like super excited about that.

I feel like the competition is low in that segment. We have done the hard part. We have optimized the unit economics, build the network strength. And I think we see a lot of opportunity on the upside.

Ankur, anything from your side?

Yes, I would say from a new product attach rate perspective, it obviously varies by the product. So I would say, for example, if you look at the low amount senders category, we've seen higher resonance and attach for our Flex product, which obviously offers liquidity when there's a cash gap. I would say for our high amount senders, we've seen a higher attach to our Wallet & Card product, because they have the disposable income that they want to store, get benefit and then spend globally in terms of global expats and earners there.

I think the benefit across both of those is because we've built the underlying platform and optimize the unit economics for each of these customer segments, we're able to get a higher RLTE per user as these products scale. And that's what we expect to see. We're seeing that right now in some of the results we shared, and we expect that to grow.

I'm Rajul Bothra from Goldman Sachs. I appreciate the directional LTV commentary around different customer types, but digging in a little bit more. How should we think about the magnitude of that difference in LTV by customer type or maybe the stack ranking of LTV and how you're thinking about the drivers of that? It sounds like primarily maybe higher volume or more consistent volumes, but if there's anything else we should be thinking about there?

I can start and then Pankaj can jump in. Thank you for the question, Rajul. As you think about lifetime value, I would say it's not only that it is differentiated by customer categories. It also depends on the geography, right? And there are multiple flavors of that. So we've simplified, of course, with the customer category view. But clearly, if you think about Remitly Business, that has a strong LTV. And that LTV is driven by the frequency, by the repeat nature of the send, multiple senders -- multiple receivers for the same sender.

I'd say high amount senders is a close one, but it again has a high LTV, as I shared with you. One $10,000 transfer already drives a pretty big amount from a customer outlook. However, keep in mind that sometimes the frequency of those high amount senders is not as, I'd say, predictable as it is for the low amount senders. So that's a little bit of the offset there. And of course, with the low amount senders, the strength we have seen is the resilience that irrespective of the ups and downs, we continue to see a very resilient spend. But clearly, it is at a lower amount that is same. So that's, I'd say, the general view on how to call it, stack-ranked, but Pankaj feel free to add anything.

Yes. I mean, I think not a lot to add, but just double-clicking on the unit economics that Vikas pointed to the LTV. I mean, that's our bread and butter. I mean, that's my favorite topic, like I can spend hours on that.

I think it's the -- if you look at it, like we look at generally the 5-year period, and within that, how we calculate is basically the cumulative RLTE dollars. So that's why even the -- you see a lot of focus that we outlined on those RLTE dollars, because every decision that we are making, whether from a marketing spend perspective or pricing engine, how it works and as we are optimizing the unit cost to serve, all ladders up to sort of how do we optimize and maximize the RLTE dollars. So that remains our kind of North Star from that perspective.

And if you would, sort of, break it down that cumulative RLTE dollars, it goes into the actual transaction behaviors and the customer behaviors, whether it's the send amount that they are sending, whether it's the transactions per active customers that we actually see, and to Vikas's point, on a per transaction basis, like how much of the RLTE dollars that you're gaining within that.

So based on the geography, based on the categories that we are serving, it actually varies a lot. But ultimately, we remain completely focus on terms of the 5-year cumulative RLTE dollars and just maximizing that.

And then final point, as you see, one of the curves that I was outlining, which is one of my favorite charts is where you see basically the 5-year LTV is actually understated, right? Because still customers from 2012, those cohorts are transacting with us. And that basically speaks in terms of the trust and the reliability that we have built with those customers, which is very, very hard to replicate from that perspective. So overall, hopefully, it gives you a perspective, but happy to take it further as well.

Sambodhi Sarkar, here, from Strivepoint Capital. Big fan of Remitly and we're large holders of the stock as well from our fund. One slide that you put up where you had that filter and you're talking about revenue growth of 30%, right? And when we look at the future outlook, that's like the CAGR that you're implying is meaningfully lower, while you have a huge TAM ahead, a lot of new products, a lot of new geographies. So, I wanted to understand, is there an ambition or a drive to get back to the 30% plus revenue growth or RLTE growth, like whichever it is, that you are trying to optimize for? Because we see a lot of levers and a lot of underpenetration. So, just trying to understand like is there an ambition or a drive to get back to the 30% plus revenue growth?

Yes. No, I'd say, first of all, thank you for your support and conviction in Remitly. And as we shared, we have multiple growth levers, and that's something that Matt reinforced with no shortage of growth opportunity. So, even in the core, which is where Pankaj shared that we have, call it, 15% share in our key geographies. Now that is clearly there is upside to that. If you look at geographic expansion, we are in 5,300 corridors. We can continue to expand there.

If you look at customer categories, we are just starting on a couple of these, same with the product. I'd say it's much more of the phasing and sequencing and how we are thinking about it, because we want to remain very balanced with regards to profitability along with it.

And this is, I'd say, some flavor of the earlier questions also how much do we plan to invest. And what we want to do is have a very thoughtful approach where we are leveraging our platform, driving extensibility, maintaining a very strong discipline on marketing efficiency and making sure that every dollar we invest gets the highest return, and doing that in a way that ultimately gets you to the Rule of 40. So our focus is on delivering the Rule of 40, right?

And if we can drive faster growth, great. If we can drive better profitability, great. But ultimately, it goes back to driving balanced growth and profitability, hitting the Rule of 40. Anything, Matt, you would add?

That's great. Well said.

And I think we have time for one more question. You've had your hand up, yes.

Prashik, this side, from 8th Wonder Fund. Amazing presentation, and thank you for sharing about new product and expansion. I'm trying to understand what's happening with the existing customer base. So my question is, let's say, if you stop acquiring new customer today, what would be natural growth from the existing customer for the business?

Yes. I can start and Pankaj, you can jump in. So first of all, thank you for joining us, and thank you for the question. I would say, again, I'll steal some of your thunder there, but Pankaj shared a lot about the back book, and he talked about how we have this lifetime value that extends even beyond the 5 years.

The other aspect is we talk a lot about quarterly active users and even Matt shared the 9 million quarterly active users. But that's quarterly. And a lot of users may not have a quarterly approach of sending, right? I may send annually to my mother or you may buy a house once in 2 years or whatever that capital spend is. So clearly, the installed base or customer base or whatever you want to use that as your term is much bigger.

And in a lot of cases, we have already touched these customers. So, our ability to even reactivate some of these provide an incentive for them to get back into sending for different motivations they may have, whether it is the exchange rate, whether whatever it may be, are very good. That's clearly a place where we are investing, where we want to really have a strong back book and drive growth through that. So clearly, top of mind for us.

Yes. I think I'll just reiterate the point around the term back book that we use over here is, it's massive, right? Millions of customers up until now have actually used Remitly platform, and these are long tenured users for us. And I'm excited about some of the new products that we are launching. And even the experience, if you look at it within the core, it has massively like up level like from a conversion, speed, transaction experience that we offer to our customers, which means that we have a lot of opportunity to sort of reactivate that customer base, which then results in higher QAUs and higher RLTE per user.

And I mean, ultimately, as Vikas was also pointing out, I mean, ours is a cohort business, right? It's a beautiful business. As you continue to give a really good value to the customers that you acquire, give them the trust, reliability and they stay with you, right? And I think we believe in that experience, because that has been the fundamental kind of secret sauce for us. I mean, which is not so much a secret, but ultimately, like it's a simple thing, but it's a very powerful thing that you really focus on what matters most to the customers and they stay with you, and you can see from the cohort curves. And from us, like that's the beauty of it. You continue to acquire good quality cohorts and they build the business for the future.

Yes. And the only thing I'll add briefly before turning it back to Dave is, I think there's an opportunity to really understand the terminal value of this business. And I like the way you asked the question, because if you look at that cohort chart, we shared things like that, things like the fact that 55% of customers hear about us via friends and family is there is much more stability.

And then, to your point about marketing as a dial, but even without marketing, the amount of word of mouth, given the product we deliver and given the amount of marketing we've spent in the past results in this stable growing business that is incredibly exciting. And it's always been that way. And you can see that when you look at that cohort chart. But one of the goals today was to really explain the why behind that, so investors can really internalize and understand how this business continues to grow in the future.

Maybe the only additional point I'd add is for the same existing customer, this is where the affinitization and attach of new products has all been helpful. So the low amount senders with Flex, the high amount senders with Wallet & Card, which I think would further help drive value for those existing customers.

Great. Thank you, team, and thank you all for your questions. We'll conclude the Q&A session there. And for those that submitted online that we didn't get a chance to, we'll get back to you by e-mail.

So with that, I will hand it back to Matt for closing remarks.

Great. I just want to say thanks. It's been a really exciting day from our standpoint. It's great to also see about half the audience that we've known well for years and the other half of the audience that is new. And I'm glad that all of you had an opportunity to meet the broader Remitly team. It's an incredible team. We have an incredible vision. And as we often say internally at Remitly, we're just getting started. So with that, thank you all very much.

Thank you for standing by, and welcome to Remitly's Third Quarter 2025 Earnings Call. [Operator Instructions] As a reminder, today's program is being recorded.

And now, I'd like to introduce your host for today's program, Dave Bickle, Vice President, Investor Relations and Strategic Planning. Please go ahead, sir.

Thank you. Good afternoon, and thank you for joining us for Remitly's Third Quarter 2025 Earnings Call. Joining me on the call today are Matt Oppenheimer, Co-Founder and Chief Executive Officer of Remitly; and Vikas Mehta, Chief Financial Officer. Results and additional management commentary are available in the earnings release and presentation slides, which can be found at ir.remitly.com. Please note that, this call will be simultaneously webcast on the Investor Relations website.

Before we start, I would like to remind you that, we will be making forward-looking statements within the meaning of the federal securities laws, including, but not limited to, statements regarding Remitly's future financial results and management's expectations and plans. These statements are neither promises nor guarantees and involve risks and uncertainties that may cause actual results to vary materially from those presented here.

You should not place undue reliance on any forward-looking statements. Please refer to the earnings release and SEC filings for more information regarding the risk factors that may affect results. Any forward-looking statements made in this conference call, including responses to your questions, are based on current expectations as of today, and Remitly assumes no obligation to update or revise them, whether as a result of new developments or otherwise, except as required by law.

The following presentation contains non-GAAP financial measures. We will reference non-GAAP operating expenses and adjusted EBITDA in this call. These metrics exclude items such as stock-based compensation, payroll taxes related to stock-based compensation, our pledge 1% contribution, integration, restructuring and other costs and other income and expense. For a reconciliation of non-GAAP financial measures to the most direct comparable GAAP metric, please see the earnings press release and the appendix to the earnings presentation, which are available on the IR section of our website.

Now, I will turn the call over to Matt to begin.

Thank you, Dave, and welcome to Remitly. Thank you to everyone joining us for our third quarter earnings call. In Q3, we exceeded our guide, reflecting momentum from last quarter and the early benefits of our growth initiatives, further demonstrating the strength and durability of our business model.

Remitly is a structurally advantaged financial platform built for durable growth. Revenue growth of 25% and adjusted EBITDA margins of 15% reflects our disciplined execution and focus on sustainable profitable growth even as we continue to invest and expand.

Today, I will focus on how our third quarter success directly validates our ambition to expand from being a leader in money movement to capturing a larger portion of the $22 trillion total addressable market. Our performance in the third quarter reflects the value of trust as the engine and competitive advantage that secures our enduring relationship with the customer.

At Remitly, trust means something very specific. It is about mastering the difficulty of delivering a seamless end-to-end experience at a fair customer-centric price with near-instant delivery and the protection provided by stringent risk management. We deliver trust by mastering complexity on the inside, so we can deliver radical simplicity on the outside. The underlying mechanics behind every transaction lead to that peace of mind.

We are obsessed with eliminating the customer's core anxiety, delivery uncertainty. In the third quarter, our reliability metrics improved even further, 99.99% uptime across the app and web and speed metrics that underscore the value of instant delivery with over 94% of all transactions completed in under an hour and over 97% of transactions completed without customer support contact.

Our platform is built on a powerful foundation with trust at its core. We want to communicate today how that platform is extending across 2 main fronts: new customer categories and new products as shown on Slide 5. Specifically, I will share an update on our success with customer categories, including business and high amount senders. I will also provide an update on new products with an update on Remitly One, including Flex and stablecoin.

Moving to Slide 6. Remitly Business continues to scale rapidly as we execute against a large opportunity. As we highlighted in Q2 with Remitly Business, we expanded our TAM more than tenfold from approximately $2 trillion to $22 trillion as we aim to serve millions of small businesses paying international contractors, vendors and employees.

Following the successful launch in the U.S. in Q2, we expanded into the U.K. and Canada, marking a major step in building a global small business payments platform. Our product allows small businesses to onboard, verify and send internationally in minutes. A seamless extension of the trusted experience we've built for consumers as we pursue a low-touch, product-led go-to-market approach for business customers, designed to drive efficient, scalable growth of this important customer category.

The number of total businesses using the Remitly platform grew sequentially this quarter to nearly 10,000 and average transaction sizes are roughly twice those of our core consumer category. We've continued to strengthen our trust and KYB engine, resulting in higher approval rates and lower onboarding friction for businesses, while keeping our platform secure and our customer experience world-class. As a direct result of these improvements, business send volume has nearly doubled on the platform sequentially.

To show this, let me share Derek Jefferson's story. A Remitly user since 2019, who recently became a Remitly business user. Derek runs a small business, HTDBComics, in the U.S., creating comic books that feature a superhero who protects the vulnerable. Derek leverages 3 consultants in Nigeria, who help him storyboard and illustrate the comic. Derek loves Remitly because our custom business experience makes it "super easy" to pay the team in Nigeria. Derek has already sent thousands of dollars across dozens of transactions in 2025.

Looking ahead, we are seeing exciting customer adoption, and we remain confident the Remitly business will be a contributor to sustainable revenue growth, margin expansion and long-term shareholder value as it expands our reach from individuals to the millions of entrepreneurs and small companies powering the global economy.

Now on to high amount tenders on Slide 7. Remitly's global payments platform has ably served both small and large transactions for years, but we have put additional focus on this growing category given our unique ability to serve these customers with a fast and affordable product.

Throughout Q3, we continued to expand send limits on our platform for certain U.S. customers, now unlocking up to $100,000 per transfer. This targeted expansion enables a larger portion of our customer base to move more significant amounts seamlessly while maintaining our high standards for compliance and security.

To accelerate awareness and adoption, we launched marketing campaigns in key high-volume send countries and in-app notifications targeted to high- amount senders. We also made deliberate strategic investments in pricing to attract and retain customers sending over $1,000 per transfer, within specific corridors like the U.S. and Canada to India. These transactions led to over 40% year-over-year send volume growth for customers sending more than $1,000, an increase in mix from these customers of more than 200 basis points year-over-year.

As we continue to remove friction, increase transparency and deliver best-in-class service for high-mount senders, we are positioning Remitly to become the most trusted global payments platform for high-value cross-border money movement, unlocking a massive underpenetrated opportunity that will continue to contribute to our growth.

Now shifting from new customer categories to new products. I'll start with an update on Remitly One on Slide 8. Remitly One represents the next chapter in our product evolution from a transactional to a more long-term financial relationship.

At our Reimagine event in September, we introduced Remitly One as a bold new way for the millions of people who live their financial lives across borders to move, manage and grow money in one trusted platform. Flex is our flexible funding solution that lets customers send now pay later, addressing a key customer pain point, timing mismatches between earnings and transfer needs, especially for those that are credit invisible.

With over 100,000 active users at the end of Q3, this product is designed to bring liquidity to our customers underserved by the broader financial system. Our proprietary data allows us to identify a valuable category among our 8.9 million customers who demonstrate consistent and responsible financial behavior, enabling us to prudently match their liquidity access with their past cross-border payments behavior. Flex provides an essential safety net for time-sensitive payments like medical emergencies or tuition as well as a deeper long-term relationship with these customers.

Remitly Wallet, which allows direct deposit and multicurrency balances and our digital debit card compatible with Apple Pay and Google Pay have shown healthy early adoption. These products expand engagement beyond send events and are expected to diversify revenue over time through interchange, while reinforcing our core value proposition. We continue to leverage stablecoins to enable growth in cross-border finance, seeing potential in 3 main areas: FX, treasury and cash management, improved disbursement rails and digital wallet features as shown on Slide 9.

Within our treasury operations, we've tokenized portions of our U.S. dollar liquidity to move funds across markets in near real time. This capability enhances our ability to fund operations globally, improves capital efficiency by reducing idle float and strengthens our FX treasury and cash management, all while maintaining the transparency and control expected from a regulated platform.

On the customer side, stablecoins enable a hybrid network that combines our already scaled fiat infrastructure with blockchain interoperability. We initially launched USDC in the United States to rapidly build the foundational infrastructure and compliance framework for our wallet. And we have since integrated stablecoins into our payout network for disbursements in partnership with Bridge a Stripe company.

Recently expanding this capability into 2 key volatile currency environments, Nigeria and Argentina, where customers seek stability and flexibility. Looking ahead, we are focused on enabling customers to manage and hold more stable digital currency balances within a Remitly wallet.

As we look ahead to 2026, we remain deeply optimistic about our position. We have built a formidable platform that still commands only a small share of a massive and growing market with significant upside ahead. Three key factors will drive our growth next year.

First, our new customer expansion efforts continue to unlock new corridors and customer categories such as Remitly business customers, extending our reach and reinforcing our global network effects.

Second, our product portfolio expansion is gaining momentum as early successes with Flex and Remitly One lays the groundwork for broader offerings such as credit and multicurrency accounts for our nearly 8.9 million customers.

And third, we are well positioned to benefit from a powerful shift from cash to digital remittances aided by the One Big Beautiful Bill going into effect on January 1, 2026, which imposes a 1% tax on cash and other physical remittance instruments that exempts digitally funded transactions. This legislation significantly amplifies the advantage of our digital-first model.

In closing, at Remitly, we start with the recognition that financial services do not naturally transcend orders, and we are designed to do exactly that. That is why we are built unlike other digital payment providers that create local market ecosystems and stitch them together.

Our borderless global network is a key component of our unique competitive advantage. Remitly now supports more than 5,300 corridors with more than 5.4 billion bank accounts and mobile wallets and over 490,000 cash pickup locations.

Finally, we hope you will join us either virtually or in person at Remitly's first Investor Day since our IPO on December 9, 2025, where we will be sharing more of our long-term vision and detailed road map.

Now, I'll hand it over to Vikas to walk through our financial and operating highlights from the quarter.

Thank you, Matt, and good afternoon, everyone. We delivered another strong quarter of profitable growth. As shown on Slide 12, third quarter revenue was $419.5 million, up 25% year-over-year, and adjusted EBITDA was $61.2 million, representing a 15% margin. Despite facing the toughest comp for the year, results exceeded expectations with revenue and adjusted EBITDA both $7 million above the midpoint of our Q3 guidance. We continued our track record of GAAP profitability in Q3, reflecting disciplined execution across the business.

Now, I will begin with an overview of our third quarter results and then share our outlook for the fourth quarter of 2025. As we did last year, we will also provide some early perspective on 2026.

Let me unpack the revenue growth drivers. Send volume grew 35% to $19.5 billion. Supporting this strong volume growth, send volume per active customers increased 11% year-over-year. This was driven by growth in both transactions per active and average transaction size as we continue to win share and gain traction with higher amount senders and business customers.

Quarterly active customers increased 21% year-over-year to nearly 8.9 million, in line with expectations. Our retention levels continue to remain strong. Take rate was 2.15%, in line with expectations.

Now, let me dive deeper into our revenue outperformance from a geographic and new products perspective. From a Sand side, U.S. revenue grew 28%, driven by continued share gains. Rest of the world grew 20% year-over-year, a sequential deceleration, reflecting the toughest comp of the year in Q3. Note, the rest of the world revenue grew 58% year-over-year in Q3 2024.

On the receive side, revenue from regions outside of India, the Philippines and Mexico grew 31% year-over-year. Similar to last quarter, our Mexico receive revenue growth outpaced overall revenue growth. We are continuing to outperform in the Mexico receive corridor, growing meaningfully faster in that corridor than the broader industry. Our outperformance showcases how our focus on localized innovation, including offering QR code-based cash pickup is driving share gains in Mexico.

Before moving to a review of profitability, I'd like to highlight our progress with new customer categories and products. As Matt noted, we are seeing strong momentum with new customer categories. Enhancements to the Remitly business platform and market expansion efforts drove a near doubling of business send volume sequentially in Q3, and new marketing campaigns and product enhancements targeting high amount senders resulted in 40% year-over-year send volume growth for customers sending more than $1,000 an increase in mix of more than 200 basis points.

I'll focus my commentary around product momentum on Flex, which continues to scale rapidly and is becoming an important driver of growth and engagement for Remitly. Flex is our flexible funding solution that lets customers send now, pay later with a no interest cash advance.

Remitly One members get access to funds, multiple withdrawals and repayment on their own schedule over 90 days. As Matt highlighted, we have over 100,000 active Flex users at the end of Q3. Flex revenue has also nearly doubled sequentially in Q3, supported by 3 monetization levers: instant funding fees from nonmembers, membership revenue and cross-border payment revenue as funds are exclusively used to send money. Early results show that Flex users transact more frequently, reinforcing its role in deepening customer relationships.

On the cost side, Flex operates with minimal incremental cost to serve and early cohorts show strong repayment activity with provision for credit loss rates in line with expectations as we continue our measured rollout. While Flex is still nascent, membership cohorts have demonstrated strong unit economic progress.

Importantly, notional cost of capital is considered when measuring unit economics of the Flex product. Flex is designed to be capital efficient with high transaction volumes and minimal balance sheet exposure. Flex is offered primarily to existing customers with established cross-border payment history, giving us access to rich first-party data and control over customer receivables balance.

As a result, nearly 90% of our $20.8 million of outstanding receivables are current, which allows us to recycle capital efficiently. We expect loan balances growth to be measured, balancing a controlled and deliberate pace of expansion along with improving unit economics. As cohorts mature, we'll continue to scale Flex as a product that deepens customer engagement and expands our platform for future value-added services.

Turning to our focus on driving profitable growth on Slide 13. Transaction expenses this quarter were $146.7 million and as a percentage of revenue were 35%. Excluding provision for transaction losses, other transaction expenses were $121.7 million, improving 38 basis points year-over-year as a percentage of revenue. The mix of digital receive transactions increased year-over-year by more than 200 basis points, continuing a trend that has been positive for our business and customers.

While early days, we have started leveraging stablecoins to unlock network efficiencies. Provision for transaction losses was $25 million or 12.8 basis points as a percentage of send volume, in line with our expectations.

Our ongoing investments in AI-driven risk models enable us to proactively mitigate fraud trends while preserving the trusted seamless experience our customers expect. As I shared in prior quarters, revenue less transaction expense or RLTE expansion is an indicator of the long-term business model success.

RLTE dollars grew 23.4% to $272.8 million, reflecting strong customer activity and economies of scale. RLTE as a percentage of revenue this quarter was 65%, consistent with what we have seen in the second quarter. We are focusing on long-term RLTE dollar growth as we continue to attract new customers, innovate with new use cases and scale.

With that, let me walk you through the specific non-GAAP expense categories on Slide 14. Marketing investments remain disciplined and growth focused. Marketing spend was $87.5 million, up 25% year-over-year and at 20.8% of revenue, which is consistent with what we had in the same quarter prior year.

Q3 also marked the first quarter where we began comping the marketing efficiencies achieved in the second half of 2024. Marketing spend per active customer was $9.88, up 3% year-over-year, reflecting ongoing high ROI investments in growth initiatives. We continue to invest strategically behind high amount centers and business customers. Our LTV to CAC was about 6x, while the payback period remained under 12 months. As a reminder, marketing investments drive returns for many years beyond our initial investment given repeat behavior.

Customer support and operations expense was $25.9 million and as a percentage of revenue was 6.2%, improving 21 basis points year-over-year, continuing a trend we have seen over the past couple of years. Our AI-based virtual assistant and product improvements have enabled lower agent contact rates while maintaining strong customer satisfaction ratings.

Technology and development expense was $55.4 million and as a percentage of revenue improved by 53 basis points year-over-year. Technology and development expenses grew 20% year-over-year as we become more efficient in managing our spend while delivering robust product innovation.

Our technology investments continue to deliver on the metrics that matter most. As Matt shared in Q3, over 94% of transactions were disbursed in under an R. More than 97% were completed without customer support contact, and our platform delivered 99.99% uptime. These results demonstrate the reliability and trust we are earning as we scale globally.

G&A expenses was $42.8 million, improving 35 basis points as a percentage of revenue year-over-year, reflecting continued leverage across the business. We are also investing in AI across the organization from writing code to writing documents to reimagining our internal operations and processes. For investors, that means we are building a smarter, more agile Remitly, one that scales faster, serves customers better and delivers long-term shareholder value.

Overall, we continue to maintain rigorous discipline on hiring and non-headcount spend while investing in compliance, geographic expansion and AI tools. Strong revenue growth, combined with efficiency and discipline led to adjusted EBITDA of $61.2 million. Once again, we delivered a positive GAAP net income quarter with $8.8 million GAAP net income, a significant improvement compared to a $1.9 million net income in the third quarter of 2024.

Stock-based compensation was $40 million and as a percentage of revenue was at 9.5%, approximately 214 basis points lower than the third quarter of 2024. In Q3, we repurchased $11.9 million of shares under our $200 million authorization, reflecting our confidence in Remitly's future and our commitment to building lasting value for both customers and shareholders.

With that, I will move on to our outlook shown on Slide 15. For the fourth quarter of 2025, we expect revenue of $426 million to $428 million or 21% to 22% growth. The majority of our revenue in 2025 comes from prior year cohorts, giving us greater visibility into the durability of our revenue growth. The expected trend in our revenue growth drivers remain consistent with recent quarters.

We anticipate send volume growth to exceed revenue growth and revenue growth to outpace quarterly active customer growth, driven by the continued momentum among business and high amount senders. Send volume per active customer is expected to grow in the mid-single digits, supported by higher transaction frequency. For the full year, we expect revenue between $1.619 billion and $1.621 billion, reflecting a growth rate of 28%.

Now, let us pivot to profitability and expense guidance. Starting with transaction expenses. We expect Q4 transaction expenses as a percentage of revenue to be slightly higher than Q3. As a reminder, in Q4 of 2024, we had significantly low transaction losses at 9 basis points as a percentage of send volume.

For Q4, we expect transaction losses to remain consistent with Q3 2025. As always, these metrics may fluctuate quarter-to-quarter, and we remain disciplined in optimizing customer lifetime value while rigorously managing risk across our platform.

Shifting to marketing. We expect marketing investments in Q4 will continue to deliver strong ROI. We'll make these investments while prioritizing efficiency. Recall, we began delivering the meaningful marketing per QAU efficiencies in the second half of 2024. So, as we lap those improvements in the second half of 2025, we would expect marketing per QAU to grow by mid-single digits, especially as we support new product adoption.

Putting this all together, we expect Q4 adjusted EBITDA to be between $50 million and $52 million, translating to 12% margins. For the full year, we expect adjusted EBITDA to be between $234 million and $236 million, representing an adjusted EBITDA margin of 15%. We expect to generate modest positive GAAP net income in the fourth quarter of 2025 as we plan to make growth-enhancing investments, improve adjusted EBITDA as well as manage dilution, net burn rate and stock compensation expense effectively.

Now, let me share some early thoughts on 2026. There are a few puts and takes to consider at this stage. As Matt highlighted, on the positive side, the federal remittance tax on cash transfers, continued product innovation and early progress in new geographies should provide modest tailwind for the business.

While these growth tailwinds are still in the early innings and will not be major contributors next year, they are laying strong foundation for future growth. At the same time, the recent immigration headwinds in key send countries such as the U.S. and Canada could potentially weigh on new customer acquisition.

Taking all these factors into account, we currently expect the revenue growth to be in the high teens range for 2026. This remains an initial view and Q4 results will be important in shaping our formal guidance for next year. As always, we remain focused on balancing growth with disciplined execution under the same profitable growth framework that has guided us in the past.

To summarize, in Q3, we delivered strong results across our key financial metrics, achieving 25% revenue growth and 15% adjusted EBITDA margins. We also delivered another quarter of GAAP profitability, underscoring the strength and scalability of our model.

Looking ahead, we are excited to share more about our long-term business model, including the durability of our growth and margin profile at our first Investor Day in New York City on December 9. We remain confident in the long-term growth potential and disciplined in our capital allocation approach.

With that, Matt and I will open up the call for your questions. Operator?

[Operator Instructions] And our first question comes from the line of Tien-Tsin Huang from JPMorgan.

Took a lot of notes here. Just thinking about '26 and the high-teens outlook that you're initially setting here. I appreciate you called out some of the tailwinds, but it doesn't sound like you're assuming much contribution from some of the new products or maybe the tax tailwind, that kind of thing. Just want to better understand what you've assumed or have not assumed in the high teens outlook.

Yes, Tien-Tsin, thank you for the question. I'd start with FY '25 first because that sets a strong foundation for a strong FY '26. And clearly, H1 as well as Q3 were strong proof points of our execution. As you saw, Q3 revenue grew 25% margin at 15% and strong performance trends across the board, whether it was send per QAU growth as well as send volume growth.

As we look at FY '26, we still have Q4 remaining, and that sets a strong foundation. But the early view that we have right now gives us a lot of optimism. It starts with the strong foundation and the durability of remittance business in general. Beyond that, we believe that remittance tax, which will take shape starting 2026 will be a net benefit for us. Again, early days, and we'll see how that progresses. But behind the scenes, our marketing efforts, our execution is tailored to take share more and more from the physical to the digital space.

Secondly, I would say the new products and customer categories, early days, but we are very excited about what we are seeing across the board, whether you look at the Remitly business momentum, or you look at on the product side from a Flex perspective.

Overall, we want to be prudent and thoughtful, especially with the restrictive immigration stance we have seen as well as just the broader macro uncertainties. And that's why sort of the early initial view we wanted to give you to just start thinking ahead. Overall, we remain very focused on balanced growth, profitability and investments. And most importantly, we want to deliver expanding margins as we go along. So overall, we feel great about the setup for FY'26.

Great. And maybe I'll just follow up on that since you mentioned it. Just thinking about incremental margins in the next several quarters, given what you've learned so far from the launch of the new products and some of the initiatives. Again, I know it's early, but just the discipline and the safeguards that you have in place to guide you to some level of incremental margin. Any thoughts on that?

Yes. I would say that, we remain very balanced, as I said, with just an overall approach where we want to deploy capital very thoughtfully to drive growth, profitability and at the same time, investing in the future bets. And you've seen us execute in FY '25 very, very thoughtfully where we have invested in these big bets. But at the same time, we have continued to leverage on the big expense categories and continue to drive margin expansion. So, our approach even going into FY '26 will be similar, where we want to really drive productivity gains. We want to drive efficiencies while we prioritize the important bets.

Yes. And overall, Tien-Tsin, the only other thing I'd add is when you just think about the overall both '26 and long-term potential of the business, I think that the $22 trillion market share where we're less than 1%, huge opportunities there and especially as we expand and go kind of upmarket as we think about higher dollar senders, as we think about small businesses, we continue to win share as there's a shift that continues from cash-based remittance players to digital remittance players, and I think that will be aided by the remittance tax in 2026.

And then, as we think about leverage on the bottom line and just increased velocity, I think that there's a lot of really reimagining what's possible at Remitly when it comes to leveraging tools like AI. So, as we go into '26, very excited. And obviously, we want to give an early view in terms of guidance. But when you think about the overall trajectory of the business, both on the top and bottom line, we're very optimistic and very excited about what's to come, and we're excited to talk more about that as well at our Investor Day in December.

And our next question comes from the line of Gus Gala from Monness, Crespi, Hardt & Company.

I want to go back to the incremental margin swing you're kind of pointing towards in 4Q. I guess that a lot of it is the marketing coming up. Can you help us think of the magnitude of it coming from more top funnel spending versus maybe CVCs at bottom funnel coming up? And then is that kind of high single-digit incremental margin? I'll ask it more point blank. Is that kind of the right bogey we should be thinking about in the first half '26, although growth we're thinking high-teens?

Yes. I think at a strategic level, when you look at the overall just flywheel of our business in terms of -- I think this is true of most payments businesses. But certainly, as we get more scale, the center of the flywheel that we've shared in the past and that we'll talk about more at Investor Day is ultimately adjusted free cash flow.

And when you think about it from an overall scale and growth standpoint, the flywheel is very much spinning. And so, we're able to not only be able to drive down costs, both variable costs and fixed costs, but we'll also be able to leverage the ability to drive more to the bottom line as we think about the investments we've made to build a brand that, obviously, if you look at last quarter, 8.9 million customers used our products. But if you look at the word-of-mouth effects, it gives us the ability, whether it's on the variable cost component and continuing to drive leverage there on the marketing component and being able to leverage the trusted brand and user base that we have.

And then obviously, as we think about just all of the investments that we're making to deliver both a fundamentally different way of completing international payments as well as a fundamentally different way to provide cross-border financial services. We're just getting a lot of leverage as we are accomplishing that very exciting vision.

So, I'll let Vikas talk about more specifically how we think about expanding margins in '26. But the punchline from my standpoint is the flywheel is spinning with more scale. We generated a lot of cash this year. And as we head into next year, we have a lot of levers at our disposal to both grow on the top and bottom line.

Yes. And just to follow up, I would say that Q4, Gus, as you think about it from a revenue perspective, the trends will be consistent with what we have seen in prior quarters. And what that means is that our send volume growth will continue to outpace revenue growth. If you look from a QAU perspective, especially as we mix shift into the high amount senders as well as business, every QAU will be driving a lot more from a send per QAU, which means that revenue growth will be greater than QAU growth. And again, we feel really great about our send per QAU trajectory.

I'll just share a few stats of what we saw this quarter, for example, we saw a record send per QAU, right? Like really, really solid performance there. And this was backed by record average transaction size growth as well as the highest average transaction size we have seen in 10 quarters. In addition to that, we have seen record transaction per active customer. So, it's a lot of really good foundation there, and we continue in Q4 with a similar optimism. So, the revenue trends continue to be similar. And as you know, majority of our cohort revenue after first full year continues through. So, we feel good that once we have a strong foundation, it just drives continuous momentum.

As you look at the expense side of the house, as Matt said, we'll continue to leverage technologies from AI to stablecoin to improve, call it, G&A leverage as well as transaction expense improvement. And as we do that, we will be very thoughtful about a very important aspect, which is investment, which builds our long-term shareholder value. So, it will just be a balance, as I said, and we remain very optimistic.

[Operator Instructions] Our next question comes from the line of Cris Kennedy from William Blair.

It seems like you've got a lot of opportunities. Can you just talk about how you balance investment going into new send markets versus kind of some of the newer initiatives that you're working on?

Yes. Thanks, Cris. Yes, I'll take that one. I think that the -- what I said a few quarters ago, which remains more true today than ever is we're a growth company with no shortage of growth opportunities. And so I think that the good news is that we get more efficient at a variety of different growth areas, whether that is continuing to launch and expand new markets, which we'll continue to do as we head into 2026, whether it's continuing to grow in our existing markets, of which there's very large opportunities there, whether it's continuing to grow in new segments or new customer categories like Remitly business or high dollar senders.

And then finally, when it comes to investing in new products to accomplish the vision around financial services that transcend borders. And what I'd say, Cris, is if you look over the last couple of years, we've invested in a much more extensible platform to do so. And so, I mentioned something called the North Star Architecture. that our technology team put together a couple of years ago now.

And then as we've been building and deploying code, both in our existing core remittance business as well as new products, we've had company-level goals where we have been basically driving endpoint compliance to the North Star Architecture. So, we've been able to deliver results for the business while making progress against this North Star Architecture. And what that means is that across those areas I mentioned, our existing markets, new markets, new customer categories and new products, it's just getting more efficient and more effective.

And then you layer on AI as a tool, which the company is very much embracing across all aspects. And it's not as much of an either/or component. It's more about where do we strategically focus within those 4 areas, and there's growth opportunities across all 4.

And our next question comes from the line of David Scharf from Citizens Capital Markets.

Maybe just shifting to the new products and specifically Flex, which it seems like has quite a bit of early momentum based on the number of users that was about 100,000. I'm wondering, can you provide us with a sense for maybe at maturity, what the credit profile of this product is? I think you had mentioned 90% current, which I'm interpreting as a 10%, maybe 30-plus day delinquency rate early on.

As the portfolio seasons, that's going to come down. But I'm trying to get a sense relative to maybe other short-term buy now, pay later products with sort of a 1% to 3% delinquency rate. Just how we ought to assess ultimately what the kind of risk-adjusted returns are of this product?

Thank you, David. Let me start and Matt can add to that. So, I'll share the same excitement you did in terms of just overall momentum of the business, 100,000-plus active users, revenue almost doubling sequentially, as well as just a minimal incremental cost that this business needs from just getting to that next stage. So really great diversification opportunity for us as a company, and we are very excited about it. I'll just clarify a couple of things that helps you think better with regards to the aging as well as the balances.

So, the first thing I'd say is that, the way the program works is send now, pay later, and there is a particular duration, whether for membership or for the non-membership. And based on what we have seen from the cohorts, we are very pleased with the cohort aging of receivables and that we have 90% current balance for members and nonmembers compared. And what we are particularly happy is that, there is negligible balance that remains over 90 days past due and that the charge-offs have been immaterial since the program's inception.

So, the way it works is slightly different than what you were narrating and the charge-off is call it, beyond 120 days. And the repayments that we have seen in that 0 to 30, 30 to 60, 60 to 90 have been very promising. And these details are available in 10-Q, so you can look into more detail there.

Yes. The only thing I'd add, David, is I think when you look at the overall Flex product, it's our flexible funding solution. Obviously, it's Send Now, Pay Later. And Remitly One members get access to funds like multiple withdrawals, repayment on their own terms and schedule. And it's adjacent to our core cross-border payments business. And you were right to call out that we now look at more than 100,000 active users as of September 30. So, we're really pleased with the progress there.

And I think the second point is providing liquidity to our customers and underwriting is complex. And so as CEO, the way to be successful in complex areas is having the right expertise on the team, and that's critical. And it's important to note we have decades of experience in the underwriting space from the Board level to the Flex leadership to the team broadly to help guide our strategic direction there. And we can leverage a lot of proprietary data from 8.9 million customers to where we're uniquely positioned to bridge the underwriting variance between customers that move to a new country and just don't have credit history but may have very high creditworthiness.

And so, we're excited about the traction there. I think we'll go into more depth at Investor Day in December on this point. I would not impute the 10% that you mentioned to 10% losses. And I'd also keep in mind that, given the expertise that we have, given how it's adjacent to our payments business, we can very much throttle who we let into that, and we can be very selective in terms of making sure that we're offering that to creditworthy customers.

And so, a lot of levers at our disposal there, a lot of expertise. We'll go into more detail on Investor Day. But really excited about having 100,000 active users and really excited about the unit economics and overall creditworthiness that we're seeing of our customer base.

And our next question comes from the line of Zoe Deng from KeyBanc Capital Markets.

This is on Zoe on for Alex. And could you talk a little bit about the economics of the business and how we compare to the high dollar centers as an example?

Great. Okay. I think the question was related to Remitly business and how that compares to high dollar senders. And so, I'm happy to go into that. I think that the interesting thing that I've mentioned, but just to reinforce is the fact that our product is very much extensible. So, we started the business serving kind of lower income, lower average transaction size customers.

And in order to do that, getting the unit economics, getting the variable cost down, getting the speed and reliability right is foundational. And so, if you kind of think about it from a classic innovators' dilemma standpoint, moving upmarket is easier for us. And so we have done that with both high dollar senders and with our Remitly business product. But our structural advantage is on the lower end where we start in terms of micro businesses, in particular, because they have not been served by traditional financial institutions.

And if you look in Q3, we continued to strengthen our KYB or Know Your Business engine, resulting in higher approval rates. We also refined our risk and business verification checks to lower friction. And we've seen great customer momentum so far. The number of total businesses has grown sequentially to nearly 10,000 now active on the platform.

And in terms of your question, how it compares to our other high-dollar senders and other individual P2P remittance transactions, the average transaction sizes are roughly twice those of our core consumer category. So, business send volume has nearly doubled on the platform sequentially. We also rolled out new markets to the U.K. and Canada specifically, and we are really excited about what's to come in the Remitly business space. And as we say, Remitly, we're just getting started and certainly are in the business space.

And our next question comes from the line of Zachary Gunn from FT Partners.

So just -- I want to go back to the guide a little bit, 4Q and the '26 commentary. You're talking about traction with new products and business. But on a net dollar basis, you're implying in 4Q, you're going to have the lowest dollar amount since, I think, 1Q '24. Similarly, '26 implies a large step down in the amount of incremental dollars. So, what is decelerating or not performing that's causing the drag?

And then similarly, I just want to ask on the take rate quickly because I understand it's being impacted by business and larger volume customers coming on. But maybe could you just comment on how much of the take rate compression this quarter was customer mix versus any impact from pricing investments or anything else?

Zach, I'll take that, and I'll start in the reverse order. Let me start with the second part of your question and then move to first. Look, if you think about the take rate part of your question, I would go back to what we have shared over the last, call it, 4 quarters, which is our North Star metric is the long-term RLTE or Revenue Less Transaction Expense dollars. And that's a much better indicator of our business.

And the reason is, to some extent, all the things you mentioned, like take rate is impacted by a lot of different factors from transaction size to corridors to pay-in, payout types to customer segment mix.

And especially, as you may have seen, we have made a few important bets over here with Remitly business with the high amount senders. And even as Matt was saying, the innovator's dilemma point, we have been able to be aggressive as we think about high amount senders. That's an area where, as we mentioned, we have been more experimental where we have made price investments. And there's nothing we have to lose over there because it's a new market for us.

So overall, we feel that long-term RLT dollars is a much better metric, and that's where, as you pointed, even though our gross take rate went down, our year-over-year RLT dollars grew over 23%.

Moving to your other question with regards to Q4 and FY '26. I'd say a couple of additional comments in addition to what we had shared earlier. The first one I'd say is that H2, and we've talked about it before also, in general, it is a much tougher comp. And if you look at Q3, Q4 last year, we had very strong revenue growth. And that is a tough comp to go against. So that's one reason.

The second is, if you look at EBITDA and the expense side of the guide for Q4, Q4 is an important quarter. This is where we'll be making important marketing investments and setting up for a strong FY '26. Again, we'll be measured, we'll be disciplined. But hopefully, that gives you some additional context.

This does conclude the question-and-answer session of today's program. I'd like to hand the program back to Matt Oppenheimer for any further remarks.

Great. Thanks, everybody. And I'll just close with a couple of comments. One, really looking forward to outlining our broader vision and telling you more about the progress in the business at our Investor Day in December. And then the second, as always, is that we always circle back to a customer story at the end. That's why we do what we do.

And today, I'll talk about a quote from Derek, who is fittingly a Remitly business customer. Derek shared with us that Remitly became his go-to app. He said, "It's click, click and the money is arriving". We thank him for his loyalty and for trusting Remitly to get money to his business reliably and seamlessly. And thank you, everybody, for joining us. We appreciate your support. We're excited about the opportunities ahead and look forward to sharing our progress at Investor Day and beyond as we continue to execute on our vision to transform lives with trusted financial services that transcend borders.

Thank you, ladies and gentlemen, for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.