Remitly Global Aktie

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.

All right. We are going to get started. Kicking off today, we've got Matt Oppenheimer, CEO and Co-Founder of Remitly, as well as Vikas, who's made a surprise appearance. Thank you for joining us today, Vikas.

Thank you.

All right. I wanted to just kind of kick it off high level with a review of some of the most recent quarter because on the call, you called this a defining quarter and a major inflection point for the company. So I was hoping you could talk about what made you say that. and why you're so excited about what's to come.

Yes. Defining quarter in many ways, Vikas will talk about some of the financials and how solid Q2 was from that standpoint. And then if you look at our vision, which is transform lives with trusted financial services that transcend borders, the announcements and the products that we talked about, specifically Remitly One, which is the umbrella for products like Remitly Flex, Remitly Wallet, and other products we'll talk about. We're incredibly excited because we know that with that product suite, we can move from transactional business to a business that has a wide range of financial services that we can uniquely offer to the 300 million individuals that live and work outside the country they're born. So pivotal moment, a lot of great products in the market now, and we're just getting started.

Great. Well, I also want to talk about some of these new initiatives. But first, let's go through some of the moving pieces in the core business. I think despite a number of headwinds related to immigration policy, the company's results have still been very strong. So as it relates to the core kind of immigrant centric remittances business, where are you seeing the greatest amount of momentum?

Yes. I'll talk about it at a strategic level, and then I'll turn it over to you to talk through the financials. I think that folks are surprised when you think about global payments. One, how cash-based they are. A lot of remittances in global payments are still done in physical cash. That is obviously rapidly shifting and there's a macro, just structural change that Remitly benefits from. And then what we've recognized is the platform that we built is incredibly extensible and incredibly valuable. And so what I mean by that is we have spent 14 years building out things like our global payment rails that enable us to transfer money across 170 countries, billions of bank accounts and mobile wallets and 470,000 cash pickup locations, 93% of transactions go through in less than an hour, 24 hours a day, 7 days a week, 97% don't require customer support.

And that kind of complexity of delivering money, I draw an analogy to oftentimes to Amazon's early e-commerce business. It's very hard to do if you're subscale and it's very hard to do quickly. But just like delivering a package gets more reliable and there's a flywheel component, our business is benefiting from that. And with that, I mentioned extensibility we recognized that -- and we actually had customers coming to our platform that were micro businesses and freelancers saying, "I want to use that platform for international payments as well."

We had what we call high dollar senders coming to our platform and saying, "that's great that you can send $250 to the Philippines, I need to send $10,000 to the Philippines or India or Mexico." And so that extensibility of moving upmarket where there's actually greater profit pools is enabled by the fact that we have this valuable platform that we have built out over the last 14 years. And when you think about the core business, we are 3% of the $2 trillion that are sent every year.

Adding small businesses at 10x is that $22 trillion per year. And so there's an enormous amount of room to grow there and then you layer on these other growth opportunities of deepening our relationships with customers. And we often say we're a growth company with no shortage of growth opportunities, and that's a very fun business to run.

Do you want to talk a little bit about some of the financials and how the business is doing from a financial standpoint, Vikas?

Yes. I think it goes back to the starting point, which is it was a defining quarter and not only that, if you look at each one, in general, we've had really strong momentum with 34% growth, 16% EBITDA, which is a Rule of 50, 2 quarters in a row, and we delivered GAAP profitability. So clearly, that gives us a lot of strength as we invest for the future. Now as you look at second half, it's different because the comps from last year were very strong. And this is where, as we have guided, the growth will moderate as well as, I'd say, we have much more line of sight in terms of where our business will land, which makes our guide much more realistic as we think about the second half of the year.

As you look at even beyond that, a lot of what we shared in terms of the new products are early days. So I just think about them as long-term growth drivers for our business. And clearly, we have built the capacity to invest. So even our expense guide includes all the new bets that we are making. So it's a very thoughtful approach where we are taking growth plus profitability plus investment as an equation and being very realistic in terms of what we are sharing.

That's great. Okay. Let's maybe dig into some of the new products. High-dollar senders you've already mentioned once, and this one is a little farther along. We can already see it playing out in some of the numbers. We've seen volume per active increase over the last year pretty significantly. There's been a little bit of an offsetting impact on take rate, but I think it's all been a very good story. Just remind us what you've done so far to target this market segment and just what's next on the road map?

Yes. So when you think about high dollar senders, as I mentioned, there's extensibility to our platform. And the things that are required to customize for that market are things like being able to send higher amounts without going through kind of what historically in the industry has been rudimentary tier limits. And with, again, more data, we have the ability to improve our machine learning and other AI-related models to be able to delineate between good customers or fraudulent -- good customers versus fraudulent transactions or any sort of bad actors. And that enables a $10,000 transaction to go through very quickly, very seamlessly. And that's where we're seeing opportunities. And it's improving to where it's not a tier-based system but it's very much risk adjusted for each individual customer, leveraging the data that we have.

And so lots of opportunities to kind of do some of that just to customize for higher dollar senders to be able to send. But outside of that, the amazing thing is the network and the platform that we built, as I mentioned, is very extensible. And so it's really about marketing and reaching those customers with what we already have as a very trusted brand in the market.

And a couple of additional thoughts there. And more and more financials. As we have seen, our send per QAU has been growing really well. In fact, we had a record dollar amount as well as record growth last quarter. A lot of that is backed by our high amount senders, which grew in volume north of 45%, and that was again a record growth for us. So lot of great momentum there. And keep in mind, a lot of it is, as Matt has said, extensible on the platform. So we have not made a very deliberate effort on the marketing side or from a targeting and that just tells us that the opportunity there is really strong, and we are very excited about that.

That's great. And so is this the same traditional sender with a different use case, like a one-off large payments that they need to make? Or is this a different type of customer? And have you thought about -- it sounds like it's been mostly a pull into this market segment? Have you thought about how that turns into a push over time through kind of marketing investments?

Yes. Well, first, what we find is that there's high dollar senders in every corridor. There are people sending money to Mexico that need to send $10,000, $20,000 more. There are some corridors where high dollar senders tend to make up a greater amount. Like if you think about intra-Europe, U.S., Europe, our largest transaction that we talked about, I think, in Q2 or Q1 was from Canada to the U.S. And so you'll have different corridors of different weightings of high dollar senders, but high dollar senders are across the globe. And so our recognized and trusted brands that we have, first and foremost, is already reaching those customers. They're already coming to our platform. And now we're just making it more purpose built to be able to handle those transactions very efficiently and effectively.

Great. Okay. So switching gears to Remitly for business. This is a real TAM expansion opportunity as you've mentioned. Can you talk about what you're seeing in terms of early traction and just feedback from customers?

Yes. So one other contextual thing, both as we're talking about high dollar senders and Remitly business is, if you look at that vision that I mentioned, transform lives with trusted financial services that transcend borders, we've only changed our vision once over the last years. And what we did is we expanded it. It used to have the word immigrant specifically in it. And what we found, I think, this is an important context is that we had businesses.

We had high dollar senders in corridors across the globe. That were coming to our platform and using it, but there was a cognitive dissonance with the team to say, but if our vision is to serve immigrants, how do we think about Remitly business, how do we think about high dollar senders? And so we expanded our vision just a couple of years ago. And that is -- that was in response to inbound customer demand that we had that were in these broader customer segments.

So with that context, the platform we built, you have Remitly business, which think about like a micro business, there's a customer just to make it real, named Mary, who moved from the Philippines to the U.S. And she's a bookkeeper. She moved here 20-plus years ago. And she has, as she's built her business, 5 or 10 contractors in the Philippines that she needs to pay. And so she already went to Remitly and tried to use our platform before we customized it with things like eKYB, which is electronic know your business as opposed to electronic, know your customer, which we've done for over a decade.

And she went through the friction of having to call our customers support, all of that because why did she do that? Because my view is that the segment in between consumer and what I would call medium and enterprise-sized businesses, is a segment that I think is underserved. And when I say it's underserved, it's because what they want, what Mary wants is the ability to send the 5 or 10 folks in an affordable, instant convenient way with a wide range of disbursement options. In the Philippines, that means everything from GCash, which is a mobile wallet to bank deposit to cash pickup.

And when you look at other companies that serve the medium and enterprise space, they have large sales teams. They have a lot of bells and whistles that Mary does not need. And when you look at our consumer platform, because we've optimized the unit economics to serve $500 transaction very efficiently and very profitably and very quickly, adding the minimal features that Mary needs to pay those 5 contractors is easy -- relatively easy for us to do. And so that's what we've been investing in. It's not only the eKYB, but there's a variety of other basic product suite features that Remitly business customers like Mary need, and we're just starting to be able to get going in that space.

And over time, I think while we start with micro businesses and freelancers we can continue to move upmarket because from our standpoint, those customers are way more profitable. Where for a business serving medium and enterprise, they're going to look less profitable. And to put just 1 number around that. 6x the average LTV to CAC ratio for Remitly business customer than an average Remitly consumer customer. So huge opportunity there and just getting started. Anything you'd add on that?

No, I think the financials are great, where we are addressing now $22 trillion in TAM versus the $2 trillion. And similar to what Matt said, the LTV is great, one sender sends to multiple receivers, average transaction size is 2x what we see in consumer. Early signs are great where we are seeing thousands of customers joined the platform. We launched in the U.S. In Q2, we had a fast follow and launched in the U.K. a couple of weeks back. So the product momentum, velocity, customer adoption, early signs are all positive. We feel really good about the long-term opportunity here.

That's great. So you said 6x your standard LTV to CAC, which I think is also 6%. Is that right? Is it like 36, okay. That's a lot.

But that's -- you're talking about the ratio -- you're talking about LTV -- more opportunity to be front-footed on marketing.

Okay. Got it. That makes more sense. All right. So then on the VAS opportunity, you alluded to it already in kind of a payroll context. But when you move into business, there's clearly a lot more opportunities for value-added services around the cross-border payments. We've seen other companies in the coverage kind of pursue these. How are you thinking about more products to kind of surround the Remitly business platform?

Yes. I think that there's features like bulk payout. There's features like scheduling, be able to do scheduled kind of payroll to a wide range of features that micro businesses and freelancers specifically need. It also connects some to our Remitly wallet strategy that we'll talk about in a minute. I think that there's a desire for folks to be able to hold value in addition to disperse funds immediately. And so there's a synergy with our overall consumer product road map with some of what we're building and what we hear from our Remitly business customers that they want and need.

Great. Great. Okay. You are on the heels flying back from New York from a big customer event this week where you announced a number of new products, including Remitly One. And so I wanted to maybe -- if we could just hand the floor over, can you give us an overview of the new products that you've announced and kind of what you're most excited about?

Yes. So that third part of our vision, financial services that transcend borders, okay? That part is really important to understand because it's our belief with a lot of data from our existing customers that financial services are not built for the 300 million individuals that live and work outside the country they are born. And so what we announced yesterday is Remitly One which is a membership product starting in the U.S. for customers that pay a $9.99 monthly fee. And in exchange for that $9.99 monthly fee, they get a variety of benefits that we announced and then benefits that we will be launching soon. And that helps us move from a transactional relationship more into a deeper relationship that solves a wide range of financial services needs for our customers, what are a few of those.

One of those would be Remitly Flex, which is a send now pay later solution that we launched earlier this year. We'll probably have separate questions on Flex, but really excited about the progress there. It's our anchor benefit. The second is a Remitly Wallet. So being able to store within the Remitly app, a U.S. dollar balance in the U.S. context. Over time, we'll roll that out to multi-currencies and we're also launching a USDC stablecoin in that wallet later this month. And then customers by specifically becoming Remitly One members can earn things like a 4% boost.

They can earn via various activities and being a Remitly One member, things like $5 monthly cash back. And so customers are not only able to send money, they're able to also manage their finances through tough times with things like Flex. And they're able to grow their funds via that 4% boost, the Wallet $5 cash back. And again, we're starting in the U.S., but we'll expand this to other countries across the globe to really meet the needs of the customer that lives a global life but historically has not had specific financial services that have met their needs.

Got it. And before we dig into some of the specific products, just do you have any high-level thoughts on what percentage of the user base might be -- what would this be like an appropriate -- like what do you think penetration could get to on the Remitly One product?

Yes, I draw the analogy to -- when I think about Amazon Prime, they launched with their anchor benefit free shipping, if you remember a long time ago. And then they added a range of benefits that different customers are attracted to different elements of that, right? Free shipping might be the core part, but they have everything from prime video to the many other benefits that Amazon Prime has.

I view Remitly One as that umbrella. And so I would see if you look at a benefit like Flex, I would see that being more beneficial for somebody who's maybe a lower dollar sender who needs to smooth that payroll. And that, by definition, is going to be different than a Remitly One member that might be interested in a multicurrency account and managing their kind of global treasury, so to speak. But obviously, a consumer wouldn't call it treasury, but they're global kind of savings to not only hold a USD account, if it's a U.S. -- if somebody has moved to the U.S., but also their Indian rupee account and potentially stablecoins and other stores of value that are more stable than the local currency that they hold.

So with that context, I think that there's a wide range of customers that we can serve with a variety of benefits that will be under that Remitly One umbrella. And we're seeing that, especially with Flex, our anchor benefit that we launched earlier this year. We're seeing, you'll probably ask about Flex separately in a minute, but we're seeing really good customer adoption and unit economics for that product gives us a lot of confidence that there's customer demand.

Yes. Well, let's go there then. The -- basically, send now pay later product, as you mentioned, how are you thinking about the use case? And also how are you thinking about terms, financial profile and any kind of like credit concerns that you guys might have? I know you're very good at managing that on the fraud side?

So we launched that earlier this year. We wouldn't be talking about it as our anchor benefit if we didn't both see the customer demand, and we didn't have a lot of data and analytics around repayment rates, which are high as well as the overall just unit economics, which is how we've always thought about the business. So looking at it and the profitability of it taking out cost of funds and credit losses, et cetera. And when you look at those metrics, it's very encouraging.

And I'm also encouraged, well, you're right, we have an expertise, I would say, in risk management, compliance, fraud prevention, credit risk is different. But when I look at our management team and when I look at our Board, we have built out a lot of expertise in that area. And we've actually had a lot of expertise in that area over a long period of time. You look at Nigel Morris, who is on our Board, who is the founder of Capital One Bank. He's been an amazing adviser inventor of both the opportunity and the risk management in this area. Phillip Riese was kind of second in command under Ken Chenault at American Express. And then we've actually opened an office in the Arlington, Virginia area to recruit a lot over the last couple of years really of strong analytical leaders from places like Capital One, and that's where the head of our Flex business is located is in the D.C. area.

So I, as CEO, I think a lot about risk management, just given that we're a fintech company. And I feel really, really encouraged by the expertise we have, the repayment rates, the unit economics, and it makes logical sense too. Because if you look at our data, I talked about this at the announcement yesterday. But if you look at the unique data that we have, which is what I think is going to be critical in terms of differentiating in an AI world, what's the proprietary data or tokens. We have a lot of proprietary data when you think about transaction data, when you think about identity, when you think about behavioral patterns. And those things can be used to broadly improve our risk management systems and just gives us a right to win in this space. and a right to serve a credit-invisible segment that has just not had other options, which is why they're willing to pay that $9.99 a month to be able to have all of the benefits that are offered within the Flex product suite.

So I guess to add on that, I think, dovetailing to what you were just saying. One of the other things that was announced yesterday was Remitly credit. Can you talk about how does that differ from the Remitly Flex product? And what do you see as the main benefit there?

Great point. So to be specific, Flex is a $250 line of credit -- or not line of credit, but ability for customers to send now and then pay back that transaction within 90 days. And in order to get benefits like being able to do multiple draws, being able to put auto pay. All of those things, you have to become a Remitly One member, which costs them $9.99. If you don't pay the $9.99, you can still become a flex member. But you have to wait for 3 business days for the funds to be received. You can only do 1 withdrawal at a time. And so we see really high adoption rate, again, because this segment of customers is very underserved of customers willing to pay that $9.99 to be a member.

That is what the -- and the customers have 90 days paid back up to $250. I think that's all the kind of nuances of the specific product for Flex. Now you mentioned that we have a credit establishment product, which is also trying to solve the problem that many of you probably know or have experienced, which is you move to a new country, even if you move from like the U.S. to the U.K., which I did, working for Barclays. The -- there is a large variance between credit access and creditworthiness, because I had no credit history in the U.K., okay? And so what the credit establishment product is, is leveraging things like the transactions that we're already sending to be able to report those to credit bureaus and be able to help our customers build credit with the credit bureaus and specifically in the U.S. to start actually establish a credit history and try to reduce the time between -- the variance between credit access and creditworthiness. And so that is going to be launched in the coming quarters.

Flex is already out there, but we're giving the market a sense of the wide range of benefits we'll be offering as part of this Remitly One membership. That's another benefit that's coming down the pipe. And there are a few others I can talk about as well, if it's helpful.

Yes. No, that's great. It came up similarly on our conversation with the firm yesterday about the importance of making sure that people using alternative credit get their information reported and they get credit for it.

Exactly.

Awesome. All right. Let's pivot over to the wallet. I've been really focused on that. I think it's really interesting to have this kind of multicurrency stored balance functionality as well as a card attached to the platform. What's your vision for the product there? And then maybe if you could talk about it. Like do you see the wallet being used more on the sender or the receiver side or both over time?

Yes. So the wallet is the ability in the U.S. right now to hold a USD balance within the Remitly app, okay? We'll be launching stablecoins later this month, as I mentioned, USDC, specifically. And important context with how Remitly has grown as a company. Fourteen years ago, bold vision, bold ambition, we started just with the U.S. to the Philippines, the only corridor we did. Because it helped us get the product right and then scale up in a very efficient and effective way. So to answer your question about the global need, yes, we will take what we've built in terms of the Remitly Wallet in the U.S. and we will add it not only to other countries where we already originate funds from. But we also are very serious about solving the problem that exists in a lot of emerging markets, which is currency in that emerging market is less stable.

And that's where stablecoins come into play, which is being able to offer a stablecoin balance like a USDC balance in markets where there is inflation and folks think about countries like Argentina or Zimbabwe, and they forget about countries like Turkey. Turkey, if you look over the last several years, the Turkish lira has devalued by 80%. So think about that for a minute right now that whatever you have in your bank account is now worth 20% of what it was just a few years ago.

Things like 4% boost in those markets don't matter relative to can I hold a stable currency that doesn't devalue. And so when you think about the infrastructure that we're building with the wallet with Remitly One and as we think about going into 2026 and beyond, we'll also leverage stablecoin specifically to solve that customer pain point, which is holding a stable balance in emerging markets. And the reason Remitly can uniquely do that is because when you look, in my view, several years out of how the stablecoin journey will emerge, is a valid store of savings.

I think in most markets, and the world is a big place, every regulator and every market will react differently. But if you look at in most markets, there is still going to be the need to actually take that USDC or stablecoin balance and then be able to get it into a local currency or local account to be able to use it, whether that's cash pickup, whether that's bank accounts, whether that's mobile wallets. And so we are uniquely good at that last mile, that last step of being able to get it from a stablecoin balance into a local currency that folks -- and local store value that folks can actually be able to use. And so that's where we see ourselves being able to really drive adoption across the globe. And yes, the ambition for the Remitly Wallet are very much global.

Very good. Okay. I think that takes us to stablecoins next. We call this stablecoin summer. It seems like we're just getting started on the implementation side of things, talk about how -- what you're doing on stablecoins and what investors -- what else can we expect to see from Remitly on that front?

Yes. With any technology, you always work back from the customer, the first I already answered, which is solving the problem of being able to hold a stable currency in emerging markets. So that's number one. Number 2 is the only 1 to add, which is the problem that corporations have when it comes to being able to manage their global treasury FX cash management. And so we've already launched in the U.S. to Mexico corridor, the ability to improve our treasury and cash management via what's called a stablecoin sandwich, but leveraging partnerships with companies like Bitso to be able to see if we can improve some of our FX spreads. And the benefit of that is primarily during evenings and weekends when banking hours are closed.

Because as you can imagine, given that we've sent $65 billion in the trailing 12 months. We get very good rates, and we have a lot of efficiency. But if you can reduce the amount of working capital on nights and weekends and then you save the interest. And if you can reduce the FX volatility and spread then there's marginal opportunities for us to improve some costs and reduce a marginal amount of FX risk. That being said, I think it's super important to understand that the cost in remittances is less that area and more in the on-ramping and off-ramping of currency and funds.

So the amount we pay to collect funds via bank count or debit card and the amount that we paid to disperse funds at that endpoint to be able to do it 24 hours a day, 7 days a week. Those are the 2 largest costs. And if there's marginal benefits when it comes to the FX, treasury, cash management, via stablecoin, we're going to participate in that and test and be on the leading edge. But where I'm more excited is that first customer problem, which is being able to give customers around the globe, the ability to hold a more stable currency. Anything you'd add on the treasury side or really.

No, I'd say that the benefit is both on the consumer side as well as internal operations behind the scene. And the good news is that we have already created systems as well as processes where we can execute stablecoin for our treasury functions. And I think it's just a good learning experience, and we see good potential, especially if liquidity expands, it becomes a good alternate option for us.

Got it. I'm going to skip ahead a bit because we're talking about parts of the network and the continuous investments that you're making. And one of the things that we focused on a lot coming kind of around the time of the IPO was just the opportunity to see higher transaction margins over time, more efficiencies on some of those payout partners or pay in partners. Where are we in that journey? And could you just talk about the state of the union in terms of where you're looking to invest to deepen the network?

Yes. Still relatively early in the journey. And so when I say that, the unique global rails that we've built out have taken 14 years, but that's because we go to specific bank or financial services institutions and emerging markets. We do a commercial agreement. We do an integration in the right way. So it's not only instant transactions, but also sharing of compliance and other information that prevent the delay of any sort of transaction. And while we operate across 170 countries, and while we are proud of the fact that 93% of our transactions are delivered in less than an hour, we're not going to rest until we get that as close to 100% as possible. And there's a lot of opportunities for us to continue to reinvent those rails.

By doing that, we build an even larger moat because it's very hard to do. It gets easier though, with scale. And if you look at our global money movement team, they are continuing to improve and increase the velocity of integrations. And you have partners around the world that are knocking on our door to want to work with us, which I will tell you is very different than 14 years ago when I started the business.

That's great. Okay. A consistent theme, another consistent theme since the IPO has been the strength of the digital marketing program that's continued to drive CAC efficiency over time. And so I wanted -- I was hoping you could talk a little bit about some of the marketing investments that you're making. And any color on some of the recent trends in CAC?

Yes, I can jump in. And I'll just add a little bit more from the previous question also, which is we look at the revenue less transaction expense dollars as our North Star when it comes to managing the pay-in, payout costs, and we have seen really good efficiencies there. Last quarter, our RLT dollars grew 34%, and we have seen good solid growth consistently.

As you look at the marketing investments, it's a similar story. We have continued to leverage really well, especially over the last 4 to 6 quarters. And especially if you look at marketing per QAU, one metric we really find very insightful, especially given a lot of upper funnel marketing as well as just ability to retain customers through marketing. That's been a very promising metric for us as well. Of course, we are coming up against tough comps given we had really solid second half of last year on that metric. But overall, our marketing investments, especially as we scale bigger, the flywheel kicks in and we get the benefit of that. So we feel really good.

Great. Okay. I wanted to talk a little bit about Agentic and kind of dovetail in with your WhatsApp product, which I think is really interesting. In the spirit of this being the San Francisco Tech Conference, AI has been the theme for the last 3 or 4 years running. What are you doing on the genic front? And could you talk a little bit about the WhatsApp product that you have?

Yes. We built our virtual agent, which we started with customer support use cases. and we saw incredible customer satisfaction scores, and we continue to build out those use cases. We then recognized that a way to reach customers is to embed that same virtual agent that we can uniquely train with those tokens and transaction and other customer data that we have into platforms that customers already use like WhatsApp. We're also in the process of adding it to other messaging apps. So customers can start their dialogue and interaction with Remitly in a more seamless low friction way and sending money becomes as easy as having a conversation. So we're seeing good uptick there in terms of new customer adoption. I think it can help with things like managing CAC and bringing down marketing spend as well as continuing to accelerate growth.

Great. Okay. We've got about 1.5 minutes left. You have been really successful in sustaining really elevated growth since the IPO. I think for longer than what many thought was possible at the time of the IPO. The growth has remained very consistent. Margins have also expanded nicely. You had earlier that you've reached GAAP profitability. Can you just talk a little bit about how you think about longer-term profitability and sort of the priorities around getting the more consistent GAAP profitability over time?

Yes. Yes. Look, as I shared earlier, our equation is growth plus profitability plus investment, and we want to make sure that we are balanced across all of the three. As we look at the future, we think deeply about profitable growth as a very important means rather than just growth for the sake of growth. So as you look at even a lot of the bets that we are making, we are being very, very deliberate and thoughtful about the rollouts. And we want to make sure, if you take Flex, unit economics is really important for us rather than just driving the growth. If you look at wallet, we want to really get the implementation right, the product market fit right.

So I'd say the long-term bets create a huge TAM for us. But I'd say those are long-term bets, and we will be very, very purposeful in making sure that we continue to drive profitability and continue to expand our EBITDA. And as, of course, as we get larger and larger, just the mathematical law of large numbers will kick in. But overall, we feel that there's a long-term durability in our business, especially as we diversify into multiple different monetization machines.

That's great. Well, I think with that, we're just about out of time, but thank you so much for the conversation today. Congrats on the new products that you've announced, and I hope you guys get back home. I know you've been doing a lot of traveling.

Thank you.

Thank you, Will.

Good afternoon. I'm Matt Oppenheimer, Co-Founder and CEO of Remitly. Thank you for joining us today in New York and around the world at our first-ever product launch event, Remitly Reimagine. Archbishop Desmond Tutu, one of my personal heroes, once said, "My humanity is bound up in yours for we can only be human together." That belief is as true in global migration as it is anywhere. Miles may separate us, but our humanity binds us together.

For as long as humans have moved, they have carried more than just themselves across borders. They've also carried their families' futures and their obligations to those back home. From the earliest migrations built on the hope of prosperity to modern journeys for work, opportunity and freedom. People have crossed oceans and continents to build new lives. And with every step, our customers live that truth every day.

They leave behind what is familiar, not only to build a better life for themselves, but to support the people they love. In this world of division and angst, it's easy to think we are so different. But what I found running Remitly is that our core drivers are identical, providing for our families, creating success during our limited time on earth and having pride in making your corner of the world better, even for our customers if it means leaving it.

Their duty, their courageousness, their generosity remind us that sending money isn't just a transaction. It's an expression of connection, of responsibility, of humanity. That is why Remitly exists. To transform lives with trusted financial services that transcend borders. For the last 14 years, our customers have trusted us with one of the most important financial responsibilities, sending money across borders. We make global transfers fast, affordable and convenient so they can support loved ones and participate in the opportunities of a connected world.

That trust has fueled us. We have built one of the best global payout networks in the world, connecting billions of bank accounts and mobile wallets, hundreds of thousands of cash pickup locations in more than 170 countries, all supported by world-class regulatory expertise and compliance. And most importantly, a trust of over 8.5 million customers earned one transaction at a time. Here's one story.

Earlier this week, I had the privilege to talk with Guadalupe, a Remitly customer who moved to the U.S. from El Salvador a few years ago. Since then, she sent money back home to support her kids twice a week. For Guadalupe, Remitly isn't just an app. It's how she pays for her kids' food. It's how she keeps them in school. It's how she ensures their futures. In her own words, my children are my savings and investments. Guadalupe's story is one I've heard from many of our customers. Around the world, our customers already look to Remitly to move money quickly in urgent moments to manage their finances across borders and to grow towards long-term goals for their families.

It is a powerful reminder of our vision, but it also challenges us to do even more. On that note, we stand at the precipice of one of the most pivotal moments in financial history. The era of instant payments, digital wallets and stablecoins make it possible to radically deliver on our vision, a world where anyone can access the money they need anywhere they are. And now 2 innovative technologies are accelerating this future, AI and stablecoins.

Let's start with AI. I believe AI is one of the most transformational technologies in history, and we are already using it to solve real-world customer problems at scale. Last year, we launched our first proprietary AI assistant. It now handles millions of customer questions, freeing up our support team to focus on the toughest issues. This spring, we brought that assistant to WhatsApp, the most popular messaging app in the world.

Customers can check exchange rates, ask questions, even initiate transfers in the same app where they talk to their loved ones. Sending money just became as easy as a conversation. But this is just the tip of the iceberg. In an AI-powered world, the most valuable resource isn't models or computers. It's data tokens. Not crypto tokens or payment instruments, but the small pieces of structured information that AI models can read, learn from and act on.

I believe many tokens that train AI models like publicly available information on the Internet will become commoditized. Companies with proprietary tokens will have a significant competitive advantage. At Remitly, every token we generate is based on data protected by the same rigorous safeguards that we apply across all of our services.

Three types of tokens are especially powerful. First, transactions, which are billions of secure signals from payments across 170 countries that help us understand and predict flows. Second, identity or how customers prove who they are, which lets us increase speed and trust while reducing fraud. And third, usage patterns around the world, when and where money is moved, which helps us improve security and anticipate customers' needs.

These tokens enable us to enhance our AI tools and deliver smarter, more secure customer experiences. We can make creditworthiness assessments more accurate and expand access to credit. We can speed up transaction times while reducing friction. We can create support experiences that feel familiar and personalized. And we can keep finding and solving problems for our customers at scale. The knowledge we've gained from 14 years of delivering for our customers is the foundation that makes this possible.

Tokens plus trust, that's our edge in the AI era. At the same time, stablecoins unlock the ability to hold and move value 24/7, 365 days a year in something stable like the U.S. dollar. This solves a real need in emerging markets where local currencies can lose value overnight. With one of the most capable global payout networks in the world, we can do what others can't, turn stablecoin savings into everyday value.

Where other stop of the blockchain, Remitly can deliver school fees in Turkish lira, rent in Argentine pesos or protected savings in Zimbabwean dollars. Given the strong foundation we've built and the tremendous opportunity ahead of us to enhance our global platform with AI and stablecoins, we have raised our sights and inspired our teams to do the same. To evolve Remitly from a cross-border payments provider to a trusted financial partner, our customers can rely on every day, a partner that helps them move, manage and grow their money with the same peace of mind they already expect from Remitly, further expanding their ability to share in global opportunity.

At the heart of all of this is trust. In consumer financial services, trust is not optional. It is everything. It's earned transaction-by-transaction, relationship-by-relationship. And today, we are beginning the next chapter with the launch of Remitly One, a financial membership built for global life. Remitly One is built on the strength of our global platform, accelerated by AI that powers everything from fraud protection to customer support to personalized experiences and strengthened by stablecoins, which make value more stable and accessible across borders.

Remitly One launches in the U.S. today, laying the foundation for the next decade of Remitly innovation. Just as we began with one remittance corridor when we founded Remitly, U.S. to the Philippines and grew into a global network spanning over 170 countries. Today's launch is the first step towards bringing this membership to our customers worldwide. And to show you what this looks like in practice, the launch of Remitly One here in the United States and the road map for what comes next, I will hand it to Remitly's Chief Product and Technology Officer, Ankur Sinha.

Thank you, Matt, and thank you all for being here. For the last 14 years, our customers have trusted us to deliver on some of their most important financial responsibilities. That trust sets a high bar. It gives us both the permission and the responsibility to grow with our customers. We've proven we can deliver in the moments that matter most, but the dreams of our customers extend far beyond a single transaction.

They want stability when life is uncertain. They want tools to manage their money across borders. And they want opportunities to grow wealth and secure their families' futures. Today, we honor them with something transformational. We are launching Remitly One, a trusted financial membership for global life.

This all-in-one experience brings together a suite of Remitly products in the same app customers already trust and can now use to build a strong financial future. Remitly One launches today with a set of benefits and 3 core products designed to meet the financial needs our customers face every day. Flex, Wallet and Cards. To bring these products to life, you'll be introduced to Sophia, Annika and Matteo, whose stories are inspired by thousands of conversations our teams have with customers that shape what we built.

They illustrate how Remitly One will help people move, manage and grow their money with the same peace of mind they've always expected from Remitly. The first product, Remitly Flex, is designed to help customers move and manage their money across borders in urgent moments. Moving to a new country often means starting from scratch without a credit history or a financial safety net.

When cash is tight, even small emergencies can quickly turn into big ones. Flex was built to change that. Remitly Flex is our flexible funding solution that lets customers send now, pay later with a no interest cash advance up to $250 for free with funds available in 3 days. But Remitly One members unlock more value, instant access to funds, multiple withdrawals up to their approved limit and flexible repayment on their own schedule. To show you how Remitly Flex can add more breathing room to our customers' everyday financial lives, meet Sophia, a sales associate in San Diego. Sophia gets an urgent WhatsApp message from her father in Mexico. His car has broken down and needs help paying for repairs. Cash is tight until her next paycheck.

In the Remitly app, Sophia sees the option to send now pay later with Flex. By becoming a Remitly One member, she gets instant access to a no interest cash advance. She sends her dad the money he needs immediately right inside the app, she already trusts. No transfer or wait time required. After sending her dad the money she needs, she turns on AutoPay, so she doesn't have to think about it again later.

We began testing Flex with customers this year and early results are strong. Repayment rates are high. Most customers who try Flex come back. And when they do, they also send more with Remitly, deepening their relationship with us. That kind of engagement tells us that we're solving a real problem in a way that earns trust and deepens our relationship with customers. We will continue building on this foundation, exploring ways to use AI to strengthen risk management and underwriting as our offerings expand, always with customers at the center. The second product we're launching today is Remitly Wallet, built to help customers manage and grow their money. Wallet is our store of value product, offering a secure place to hold funds inside the app our customers already trust to send money. For many, it's the first time they've had a reliable store of value that works seamlessly across borders.

Remitly Wallet is free to use. And with Remitly One, it delivers even more value with a 4% annual boost cash reward on USD balances, turning everyday savings into steady progress towards future goals. Later this month, we'll also start to roll out access to multicurrency accounts, including the ability to store funds in USDC stablecoins, offering more options to plan, save and stay in control.

To show you how Remitly Wallet can help our customers' money go further, let me introduce you to Anika. Anika is a nurse who wants to contribute something special to her sister's wedding in India. She has used Remitly in Canada to send money to her grandparents in India. With 8 months until the wedding, she opens Remitly Wallet with a USD balance and joins Remitly One, earning a 4% annual boost on her balance.

Because her wallet is connected to Remitly's global payout network, she's able to access her funds whenever she needs to. As we were building the Remitly Wallet, I spoke with Alberto and Diana, a couple whose lives are split between the U.S. and Mexico. They travel often to see each other, and they need a simple way to use their money in both countries. In Diana's own words, if I can pay by card, I prefer to use the card. Their experience showed us something important. Sending and saving money is not enough. Our customers also need everyday access to it.

So we built it. This is the new Remitly card. We're starting to roll this out to Remitly One members in the U.S. starting today. They will be able to spend directly from their wallet anywhere with a debit card that has no foreign transaction fees. Just add it to Apple or Google Pay and tap a checkout.

And while this may sound like a simple convenience to many of us using a card with value to spend easily, we know that for many of our customers who lead global lives, instant global access to funds can be a hard thing to come by. Imagine Matteo, for example. His permanent address is in the U.S., but he travels often and works from different countries. He wants to grow his savings, but he needs easy access to multiple currencies. So he keeps extra cash in his Remitly wallet, steadily growing with annual boost rewards. Now Matteo would be able to add his Remitly debit card to Apple Pay and tap at the checkout counter in Boston or Bogota, instantly using the money is already stored safely in his wallet with no FX surprises and no waiting. And every time he does, he will earn rewards. If Annika, the nurse we met earlier, wants to pay for lunch in Vancouver or a gift for family in Mumbai, she can tap thematically debit card and pay instantly. No transfers, no hidden fees.

In addition to Flex, Wllet and Cards, another way we grow towards a stronger financial future is with rewards that turn everyday actions into steady progress. Members can earn cashback every month through simple things they're already doing to manage their finances, like adding funds to their wallet or setting up AutoPay for Flex. Annika and Sophia, 2 customers navigating very different realities are both earning a little extra money to use however they choose.

Cashback is one of the first rewards we're offering members, but it won't be the last. We're already testing new rewards as well as third-party benefits like identity protection and credit monitoring. These benefits are powerful on their own, but together, they're the start of something much bigger as we establish deeper, more meaningful relationships, supporting our customers' ability to achieve their dreams. Here's what's next for Remitly One. For many of our customers, arriving in a new country means becoming credit invisible. In the U.S. alone, more than 30 million people have little or no credit history. They may be working hard to earn a living, but the lack of history can be a huge barrier to rent an apartment, finance a car or even qualify for jobs. We wanted to change that.

Starting next spring, Remitly One members in the U.S. will be able to access a line of credit designed to help establish their credit history through simple activities by reporting everyday financial activities like sending money home to a U.S. credit bureau will help customers establish the recognized credit profile they need. Starting this month, Remitly One members will also be able to store value in USDC stablecoins in their wallet.

And later this year, they'll be able to send it to compatible wallets. We've partnered with Circle and Bridge to harness the power of stablecoins for cross-border payments. Long term, this will enable us to move value instantly, reduce friction in liquidity and treasury and give customers the ability to hold their savings in something stable like the U.S. dollar.

Remitly has spent 14 years building the compliance and regulatory frameworks, FX capabilities and local partnerships that make stablecoins practical for customers. Holding USDC in a wallet is only valuable if you can easily use those funds in your local economy. Remitly's robust global payout network spans billions of bank accounts and mobile wallets and hundreds and thousands of cash pickup locations worldwide. That last mile access is what turns stablecoin savings from an abstract idea into something people can rely on in their daily lives.

With Remitly One, we're building on the trust our customers have placed in us, fulfilling that responsibility by giving them borrowing power in urgent moments, savings that grow steadily, everyday spending that works seamlessly across borders and rewards that add up over time. Remitly One launches at just under $10 per month and customers can join the waitlist today by going to remitly.com/one. Remitly One will enable us to deliver on our audacious vision to transform lives with trusted financial services that transcend borders by strengthening the most valuable part of our business.

The relationship we have with our customers. By offering everyday tools to move, manage and grow their money with confidence, customers will engage more consistently and stay with us longer. Remitly One will become our highest value customer offer, bringing current and future services into a single holistic membership and driving deeper customer engagement and retention. With Remitly One, we've taken the first step in our evolution from a payments provider to a true financial partner, helping customers prosper, build better lives and share in the opportunities of global innovation.

We'll meet customers in the moment they choose us to move money and stay with them from covering an emergency expense to planning for a child education, Remitly One will be there. This is how we move from transactional to transformational. This is Remitly One, a financial membership built for global life and a foundation for the next decade of Remitly innovation. Let's watch it come to life.

[Presentation]

Thank you all for coming.

Welcome, and thank you for standing by. I would like to inform all participants that this conference call as well as any Q&A may be recorded. Where a company is presenting, recording may also be posted on their website. Views and opinions expressed by any external speakers on this call are those of the speakers and not of JPMorgan. Parts of this conference call may be reproduced in JPMorgan Research. If you have any objections, you may disconnect at this time. Unless otherwise permitted by internal JPMorgan policy, members of JPMorgan Investment and Corporate Banking are not permitted on this call and to disconnect now. I would now like to turn the call over to your host.

Great. Thanks, everyone, for joining. My name is Tien-tsin Huang. I'm the payments IT services analyst at JPMorgan. So I have a really timely webinar. I think Remitly has done a great job of doing a lot more investor outreach and the product velocity has definitely stepped up. That's a big theme in payments and fintech right now. They have their first product keynote tonight as well in New York City. So we are actually live and in person with the management team. So we've got Matt Oppenheimer, Chairman and CEO, Co-Founder. I've always respected Matt a great deal. I think of Matt as a true mission-led CEO, which I think is really important in our sector. We got Vikas Mehta, CFO; and Luv Sodha as well from Investor Relations. But welcome. Thank you guys for doing this.

Thanks.

Thank you.

Great to be here, and it's been great. I think you've followed us since 10-plus years ago, you've noticed from the very beginning. So it's great to see you again.

You look the same when I had the first session and one of our next-gen payment conferences with private companies, you look the same, Matt. So yes, it's been a while. And I've learned a lot covering the sector. I don't always tell you that, but I definitely learned a lot. And so these sessions are super helpful for us. So thank you for doing it.

So yes, I know you'll cover a lot of this at the keynote tonight at 5:00. So I'm sure people will tune in for that. So this is hopefully a good buildup to that. And I know you did this session with my friend, Will, a few weeks back. So I'm trying not to be too redundant, but he did start, and I'm going to start with the same question. In the second quarter, you talked about 2Q being a defining quarter and an inflection point as it relates to product innovation. So I know you're going to give us more details, but I did want to just talk about, right, we put things in Excel and we have these quick conversations, but a lot of hard work goes into it. A lot of investments have gone into it. We've seen the headcount grow in things, and now we're seeing some of the output of that. So why now? Why is now the time to come out and talk about all this product innovation at Remitly?

Yes. Yes, absolutely. It really was a pivotal quarter for us. Obviously, in addition to the core business just continuing to do well. Over the last 14 years, we've really built a purpose-built global platform for cross-border finance, not just payments. And so we think about the security, the compliance, reliability, a lot of the data and analytics that we have that we can leverage in AI and other areas. And so that foundation obviously now powers from a payment standpoint, 170 countries. And in Q2, we said, how do we take that platform and build on top of it in a broader way to accomplish our vision of transform lives with trusted financial services that transcend borders. So what that meant in Q2 in terms of what was coming to life is Remitly Business and excited about the traction and momentum there, which we'll talk more about. I'm sure Remitly One, which is really going to be the focus of the event tonight and going into more depth on that. And if you want to find out more about the event tonight, it's Remitly.events, you can go and find out how to join that. Stablecoin integrations, Agentic AI move from a road map to a reality. And so this foundation we've built is very extensible. And we'll talk about that, I'm sure, in the conversation today, and we'll certainly talk about that tonight.

Yes. So I think we talked about this idea that Remitly spent so much time, Matt, building that trust with the users and you're doing so well in cross-border peer-to-peer, it makes sense to extend. -- into more financial services. And you said right, that the mission or the vision is transforming lives with trusted financial services that transcend borders. So the question I have for you is, what is your right to win as a financial services provider. We've got a lot of companies we cover that are trying to bank their user base. Why should Remitly do the same and win?

Yes. Yes. I'd say it's 3 things. The first is you just mentioned customer trust. We served 8.5 million customers that rely on us to send money when it really, really matters. 93% of those transactions are delivered in less than an hour. And you know, Tien-tsin, from covering the space over a lot of years, has really hard to deliver and gets better every quarter. And then 97% are complete without customer support. And so that reliability and that trust really gives us the permission to do more. So trust is number one. Number two is our tech platform. And over the last several years, we've built what we call our North Star.

We built towards a more modular tech platform that internally we call our North Star architecture. And that's purpose-built to not only accelerate the velocity of delivering our global payments product, but also makes it extensible to be able to add other new products on top of it, whether that's leveraging it for our authentication systems, which we can use to roll out new products or leveraging it to really capture the data and signal that we have on our customers across pay in, payout, device, velocity, transaction velocity, FX, fraud. So that is number two, is the tech platform we've built is I think, unique and very powerful. And then the third is -- I'll talk about this again tonight, but our product ambitions have just raised because we've recognized what is possible for us to do for the 300 million individuals that live and work outside the country they're born, plus millions of small businesses, which expand our TAM by 10x.

And I think that ambition is raised because of the first 2 things I mentioned, but also there's amazing technology at our disposal right now. When you think about stablecoins, when you think about AI, and all of that moves us towards that vision. And those 3 things, customer trust, a technology platform and just raised product ambitions give us, I think, the right to win in this space in a very exciting and fun way.

Okay. Good. So you mentioned 8.5 million customers and the 300 million available that live outside -- work outside their home country. So let's start with 8.5 million. How banked or happily banked, maybe is a better question, are these customers today, right? So I'm trying to understand what percentage of those users could potentially use some of the products that you're going to be talking about more tonight.

Yes. Yes, it's a great question because I think even the term banked is really important to define, right? And it's something we've thought a lot about over the last 14 years. Because when you think about it from a store of value standpoint, our customers link their bank account or their debit card in the U.S. context for another payment instrument in other countries. So they have a store of value.

What they don't have, if you talk to a lot of our customers, and I'll give you some customer examples here in a bit, is the ability to bridge credit access and creditworthiness once someone moves to a new country. the ability to hold multicurrency accounts and think about how to manage their treasury, so to speak, their personal treasury on a global basis. I think that's available to the most affluent on the planet, but not to our customers historically. And that's where things like stablecoins, I think, can get really exciting. And just the ability to travel and be able to -- and I'll talk more about this in terms of specificity tonight again, but the ability to just manage one's global financial life. That is where I think we can delineate. We're not trying to be a domestic neobank that space is crowded. We're not trying to get into areas that I think are well served.

Our customer segment, I would argue, is less well served in some of those areas. And again, we have the unique right to win to serve them. And I think over time, what that will do is not only increase ARPU, in terms of additional revenue streams, but it just deepens the relationship. And I think it will drive increasing engagement for our customer base when you think about the next decade of Remitly innovation. And so really, really excited across those fronts as well as the outputs that it will drive.

Right. So think about the outputs as an analyst and maybe Vikas, you want to chime in here. You mentioned ARPU, you mentioned engagement. How should we measure the progress and the success here in the short and mid long term?

Yes. No, it's a great question. And first of all, we are very excited about just the wallet share that we are able to address now. And we are now moving into adjacent spaces, including send now, pay later or providing a store of value as well as, of course, double downing on our strength of the transaction side and doing that in a very meaningful way through Remitly One, which creates a deeper engagement. So on one hand, we are diversifying with a lot of new monetization models from membership fees to interest income to fees for the send now, pay later.

So that's one thing that we feel really good, especially as we move into the next 10 years of building new businesses. The second space we are very excited is the Remitly business side, where we'll be able to add a whole new customer segment. And this is very -- again, very adjacent. So from an investment perspective, we are not adding a ton of investment to get in there and leveraging a lot of our core systems. So that's the second piece that we feel very excited. And not only are we increasing ARPU on the consumers, we are adding the consumer segment. And as we do that, I'd say the first thing is we are expanding the TAM massively going from $2 trillion to $20 trillion. Even the early signs we have seen are very positive across all these different businesses.

Some are further, some are very early. So again, these are early days. And as we go forward, first priority for us is to make sure that we are addressing the customer need in a very deep and a very connected way. And then we'll continue to expand this. So I think about this as a 5- to 10-year horizon in terms of how we will scale and grow. And in our, I would say, early days, it will be much more about the product market fit.

Okay. Got it. So just -- over that time horizon, we've gotten this question, so I'll ask it here. Can you just outline -- we're using the term guardrails here. So the guardrails around the investment in the new products that you're talking about, could we see a change in incremental margins that we've been observing over the last year or so? And should the existing R&D that you put in so far support, right, the new products that you're about to launch and will launch in the next 5, 10 years? Because we have seen headcount growth. So just curious how all of that will change or evolve? Or have we seen that in the run rate today?

I'd say that we have been very thoughtful and disciplined in how we have innovated. And the core principle that we go ahead with is growth plus profitability plus investments. So we want to be very balanced in our posture. That's something that you have seen even in our past quarters, where a lot of these initiatives we have been working on for quarters and years.

So this is not like a fresh investment, if you may. And at the same time, we have been able to drive very strong performance. As you saw in the first half of the year, we grew 34% and maintained a 16% EBITDA margin, like Rule of 50, both quarters, which shows that not only can we grow and drive profitability, but we can invest to build the future. One of the things that Matt said earlier is a lot of it is based on the core platform investment. So the North Star architecture that we have built now enables a lot of these new businesses and to spin up the new businesses, the incremental investment is not a step change, it's incremental. If you look at a lot of our core services, whether they are managing transaction loss, whether it is the analytics on pricing side, whether it is marketing, we are able to extend all these assets we have into our new businesses. And that creates a long-term leverage and a really strong business model for us.

Got it. Yes, because I know you mentioned modularize and a lot of the investments have been gone through the rigor. Over the years, you spun out a lot of different things in the past, right? So we're assuming that all that has gone in to support where we are today with some of these launches.

Yes. Yes. And I actually credit our -- who will be speaking tonight Ankur Sinha, who's our -- now Chief Product and Technology Officer, but he came in as our actual first-ever CTO, we -- about 3 years ago, 3.5 years ago. And before that, we were delivering at high velocity. But it wasn't towards a North Star architecture that made it so every single code that our engineers write gets higher ROI, so to speak, from an investment standpoint because of the progress made towards a vision of a North Star architecture.

And then you never achieve that vision exactly, but working towards that over several years and having company-level goals around it, make it so the velocity is higher, the return is higher, the reliability is higher, the security is higher. And I'm really grateful for that. And I think that, that's also, again, why it's a pivotal moment because we've got the foundation to be able to build and deploy product just much faster.

Yes. No, it's important. So I'm glad you went through that. So thank you for that. So let's talk about some of the details. I was struggling with which ones to start with, but let's do business and then talk about One and flex in the wallet, if that's okay,

Right.

So I know a lot has been discussed around business the last couple of quarters. It's now live in the U.S. Maybe start with what you've learned so far, where are you doubling down? Where might you sell some things down, where are you now?

Yes. Yes, I'd say there's been 3 early learnings. The first is, I think we have the right segment with the right product that we're offering. So we're focusing on freelancers and micro businesses. And that avoids an overbuilt kind of medium to enterprise like product for this segment, which doesn't need an enterprise stack, but fits to our strengths, fast onboarding, low cost to serve, solid pricing because we have a low cost to serve and reliable delivery. So that's number one, right segment, right product. And that's not a huge surprise because we had customers, again, already coming to our platform, trying to use it.

And we just haven't automated some of the things like KYB, know your business, et cetera. But it's always a positive signal when you have customers that are going through a lot of friction to use your product when it isn't even optimized for it. So that has been validated.

The second is the economics are attractive. If you look at the average business sends, they're 2x consumer. Repeat usage is strong. Early signals support a 6x LTV versus consumer given the frequency and volume. So that's number two, the economics are really attractive. And then number three is, given some of the product velocity, we've had some big onboarding wins in terms of automated EKYB, real-time screening, attestation flows, that's lifting approvals and conversion.

And then features like bulk and recurring payments, simple reconciliation, some of the basics that, again, this segment needs some of those foundational features, we're now building out to make Remitly a daily tool for those businesses. And so the outcome is strong. It's strong early adoption, healthy early retention. And I look at customers like Tony, which kind of make it real, but Tony is based in the U.S. He runs a business -- small business that manages short-term rentals in the Dominican Republic.

He heard about Remitly from one of his contractors in the DR, who managed some of the repairs. And before he was relying on wire transfers that took days. You can imagine the fees related to that, and he didn't have as many choices for how funds could be received. In terms of DR, there's very specific ways that folks like to receive money.

With Remitly, he can send whatever is most convenient to his workers, cash pickup, push to card. In the DR, one of the unique things is it's one of the markets that still has door-to-door delivery. So you have the courier deliver those funds to your door. And so businesses like Tony's firm are relying on Remitly to pay overseas contractors, suppliers quickly, and it gives them exactly the solution he needs.

And I'm convinced there are millions of customers like Tony out there, and we're just getting started in being able to serve that segment. And over time, I think we can actually move upmarket. Our ambitions are large. But just like we've been successful for the last 14 years, focus early days on a specific segment and then kind of land and expand. And I think we're doing that with Remitly business right now and really excited about what's to come.

I had a question on here, like who you're taking share from. You kind of mentioned wire transfers. So I'll ask that question together with the pricing philosophy around business. I believe it's priced similarly to the personal side. But as we think about the opportunity because it's wire transfer is a potential share donor, this question of wholesale plus versus retail minus pricing. What's your philosophy on there? Because some of the wire transfer pricing is quite high, and it's a bad experience and all that good stuff. You're going at it from a very low cost still relative to that, I believe. But what's your philosophy around pricing and solving that issue?

Love that question because it's something that I put a lot of time and thought into actually thinking about. So one of my professors at Harvard Business School was Clay Christensen, he's since passed, but it was just an amazing, amazing individual. Obviously, wrote the Innovator’s Dilemma, one of my favorite classes and just favorite humans. I think that when you think about wholesale, whether it's bank wire transfers or whether it's other technologies that are serving kind of SMBs and enterprise, what you see is those businesses are moving upmarket because you look at just the innovator's dilemma, it's easier to chase those very large profit pools of larger customers.

And I think that's created a window of -- I like your term kind of retail minus where we have the cost -- we have the focus and ability from a unit economic standpoint to serve micro businesses and freelancers because I think that segment has kind of been left in the middle. And I think in some ways, from an innovator's dilemma standpoint, for us, those look like even higher LTV customers, and we have a unique low cost to serve in terms of our unit economics. They don't need all the bells and whistles, and we don't have the overhead of large sales teams and other things like that, perfect fit. And so I view us as kind of the disruptor, so to speak, in the Remitly business space. And that's why we are focused on micro businesses and freelancers to start because I think that's the segment that is very obvious for us to be able to provide a superior product.

So how do you find these users? You mentioned the Tony example of hearing it from one of the contractors, but how do you find these users, how do you advertise or how do people discover it?

Yes. Well, if you look at our brand overall, there's a high overlap, like the contractor that we mentioned in the Tony example. And so I think a lot of customers are finding us organically. But we're also thinking about innovative partnerships and other things that we can use to drive additional awareness or customer adoption for this segment. So organic, and we're in the process really of putting together a marketing playbook that will include both a lot of tools we use already as well as potential partnerships for where businesses serve this kind of freelancer and micro business segment, but they don't have the payment capabilities, and so we could be a good potential channel partner for them.

Okay. Good. Just on the margin side, Vikas, thinking about -- reading about it, there's a dedicated business support. I know there's some other reporting that you do that's distinct. We should probably talk about fraud as well. But tell us about the current margin for that business? And how do you see it in comparison to the consumer side or the retail side?

First of all, as I shared earlier and Matt added as well, a lot of what we have built is on top of our existing systems. So I think that's the biggest place of benefit for us as you think about leverage as well as expense profile. The second is, as you said, as we move more into the business segment, there will be business-specific needs, whether it is creating the workflows from a product perspective, whether it is targeted marketing or whether it is thinking about specific levers we need to use to grow that business. So as we look at that, I'd say in the early days, we are going to continue to leverage a lot using the existing systems. And then selectively, we will keep investing so that we can -- the 10x TAM increase that we have in front of us, we can leverage that and drive massive growth around that.

If you look at our focus on marketing, right now, our focus is to go after consumers who also have a business profile. And that, again, helps us to target in a more leveraged way. As we move forward, we'll continue to do that, but also selectively start targeting more business-specific customers. So I'd say, as we look forward over the next 6 months, we continue to feel that there's a lot of leverage that we can gain from the existing investments as we move into the next year and beyond as we grow, we'll continue to drive selective investment in those areas to drive meaningful growth as well.

And is the investment also investing in potential fraud by opening up the application funnel is taking more?

Yes. Thus far, we have not seen any different fraud profile. So for us, we are using the same infrastructure. And I'd say the early traction has been good. As we have said, we have thousands of customers there, but we have not seen any meaningful distinctions there. The second thing that I'd like to highlight is what Matt said earlier, which is we have 6x LTV over here on the business customer versus our consumer. which gives us meaningful opportunity over the long term, which also gives us an ability to invest in marketing. So our 6x LTV is what we are looking at to make sure that that's the potential we have. And then it is definitely a responsibility for us to invest meaningfully just seeing that high LTV.

Yes. No, we like the approach. I mean I think what we've learned over the last few years in payments, right, B2B is really hard. We saw Western Union get rid of their B2B business and just focus on the consumer, but it does feel like you're taking a very careful and thoughtful approach to it. But as you think about SAM and TAM and a lot of this will depend on your rollout schedule for geos, how quickly can we see this expand into more territories and corridors?

Yes. So on the overall TAM, it goes from $2 trillion to $22 trillion. And that doesn't include enterprise. It doesn't include a lot of the higher end of the market. So 10x pretty amazing. To answer your question on rollout, the focus right now is, again, stay focused on that micro business segment standpoint. Again, focus, I think, has been short-term focus with long-term audacious goals has been a key to our success, but expand rapidly as you think about the geographies by which we can offer that service to small businesses. So we launched the U.S. in Q2, which we shared. U.K. launched in August, which we're really excited about. Canada is going to follow in Q4. And from there, we'll add markets and capabilities like some of the capabilities I mentioned to both serve that segment better as well as move upmarket over time. But our view is that the whole $22 trillion evolves towards modern rails and our platform, we think, is really well suited to participate meaningfully in that transition.

Okay. Good. Anything else in business? Or should we move on to One?

Move on to One.

Move on to One. Let's do it. So Remitly One, a lot of good questions I fielded from the investment community on this one, guys. Just the membership program, that you called it the foundation of a new ecosystem. So maybe elaborate on that to start? And what's the pitch to consumers to sign up and pay for membership?

Yes. I think it is exactly the foundation for a new ecosystem. And again, we'll go into a lot of the specificities around pricing and other elements tonight. But I draw the analogy to the early days of Amazon. When you think about Amazon Prime, it added free shipping as that kind of anchor benefit and the entry point to a much, much broader ecosystem. And I chuckle these everything from like Prime video to -- we all know or presumably most of us know is Prime customers. It's amazing the number of benefits that they offer.

But they started with one anchor benefit that really resonated, which was free shipping. And I think that Remitly One is similar. It begins with a single clear benefit and grows from there. And again, we'll talk more about this tonight, but I think that anchor benefit is Flex, which is our short-term liquidity product that lets customers send now, pay later in moments when timing matters most. And for many customers, that peace of mind is incredibly valuable. And beyond Flex, Remitly One over time is going to bring together a wide set of benefits that give customers more control, flexibility, predictability. We'll talk about some of those other benefits today or this evening, and we talked a little bit in Q2 earnings about that. And all that is going to live in the same app that customers already trust and use regularly. So no additional app or download is going to be required. And importantly, as we've mentioned, we've built it on top of the infrastructure we already have. So not only does it not add significant incremental cost, but the velocity of innovation to get to product market fit is just much faster.

And we'll measure success by looking at, as we talked about, the RLTE per customer ARPU, but retention is one that I think is really important when we think about the next decade of innovation because I think this will -- you think about, again, the Amazon Prime analogy, you don't think about going anywhere else because you've got such a deep relationship with Amazon given that Prime membership. And I think Remitly One will be that. The only other thing that I'll add just to make it a little more real. Actually, I'll come back to a customer story unless you want me to talk about it right now.

Sure, now. We're with you.

I just think, it -- I think it makes it real. So this is a big week for us, obviously, right? We've got Remitly One, the Reimagine event tonight. We're excited about today. We're excited about tomorrow in San Francisco. But I started off the week by talking to a customer in Guadalupe. And Guadalupe is a Flex customer that's the send now, pay later. And then by having a Remitly One membership, she gets additional benefits. But let's just talk about Guadalupe for a minute. She moved from El Salvador to the U.S. and to provide for children back home.

She's 2 kids back in El Salvador that she hasn't seen since she moved to the U.S. in 2022. Just think about that for a minute. It's unbelievable. She works in a couple of jobs, and she sent money nearly every week to support her family since she joined us in 2022. And went -- sorry, she moved here in 2022, if I said 2002. So when unexpected expenses arose, she used -- last year, she used Flex, and she since repaid successfully. And for her, Flex meant that she could keep helping her family when it mattered most, and she needed to smooth some of those cash flows. And I will tell you, when I was talking to Guadalupe, her loyalty and commitment and appreciation for Remitly being there when she needed it the most was incredibly powerful. But just Guadalupe's story is incredibly meaningful.

And so to your point, Tien-tsin, about being mission-driven, Guadalupe is one of thousands of customers, and it shows that I think have the real need for Remitly One type membership and strengthens customer trust, deepens loyalty and positions us more than just a transaction provider and being a true financial partner in people's cross-border lives. So that's what we're excited about.

No, that's a good case study just to comp me thinking, right? We -- we've learned a lot covering a lot of these new neobanks and fintechs, including Chime, and you appreciate the liquidity needs of everyday Americans and how they can tap into that in emergency payments and here it is so close to home, right, sending money back home with family, of course, is critically important tied to your mission. But we've definitely learned that the liquidity needs of that everyday user is real. It's still untapped and underserved. So it does seem like an opportunity. But before we talk about Flex and that part of it, I just -- I like the Amazon Prime or Walmart+ example, and I was thinking about that in financial services. So American Express, of course, has premium Platinum products and Chase has that as well. You give certain benefits, access to ecosystem, travel. Of course, that's on the high end of the spectrum.

But within payments and fintech a lot of the services are more merchant funded, right? Interchange is funded by merchants and these rewards get paid back. Buy now, pay later is a transactional purchase for discretionary goods, also merchant funded. So help us compare and contrast whether it be a neobank or a fintech experience, I know it's a different use case here, but there is some habituation, I think, for, hey, I can get a loan for free or very little and then have the freedom to do what I need to do versus I'm going to pay Remitly a subscription fee for access to the same, a similar service. So help us understand how this fits or is differentiated or what problem it solves versus what a neobank is trying to do, which is I know more transactional. Can you follow my question?

Yes, I do. Yes. And I think what you'll hear about when we talk about Remitly One tonight, first off is the umbrella is there are different pockets of customers and segments of customers that we can serve. There's a customer like Guadalupe that might need that short-term cash flow. But by definition, won't be as interested as, call it, our more affluent customers that have multicurrency and global cash flow required -- or not global cash -- global, just treasury and money management requirements or needing the ability to seamlessly be able to go back home and use the funds in their global multicurrency account.

And so one thing to view Remitly ON as is an umbrella with different segments of customers that will be attractive in different parts of the value prop and product offering. Again, not all that dissimilar to something like Amazon Prime. Some people love certain benefits, some people love other benefits. And so that's a way to view Remitly One overall. When you think about the model for that, I think that the -- it goes back to our customers being underserved. And so when you look at the desire, and we're already seeing this, even though we're just talking about launching it today, the desire to pay that monthly membership fee for benefits that we're offering, it's because a lot of folks maybe on this call that have moved to a new country. When you think about the bridge between credit access and credit worthiness, I mean, they're credit invisible. It doesn't mean they don't have high creditworthiness. But there needs to be a company like Remitly that has the data, the analytics. I call them tokens. I'll talk more about tonight, but unique tokens that we can use to be able to bridge that gap between credit access and creditworthiness.

And we can uniquely do that. Customers are willing to pay for it because it's not something that some of the others send now pay later or other providers can do because they don't have the unique relationship and data that we have on our customers to bridge that gap. On the more affluent side, we have a global payout network of billions of bank accounts across the globe. So we'll probably talk about the wallet here in a second. But when you think about storing both fiat as well as stablecoins across the globe, being able to do something with those funds is something that we are incredibly good at. So you might have a savings account, but if you need to get it into that local Indian bank account where you need to actually, like Tony, be able to get funds to the recipient in cash so they can use them in the Dominican Republic. We have those unique assets. Customers are willing to pay for those benefits because it's an underserved segment that we can uniquely add value to. So it always comes back to the customers and different companies, to your point, will have different business model. What we say -- what we see is as long as you solve the customer problem in a material way, and we have the right to do that and right to do it uniquely, customers are willing to pay for that service.

Yes. And we learned that, right? It's hard to get fee-free checking, right? And we've observed that some of the things you're talking about accessing foreign bank accounts is not available to -- without a cost. So here, you're making it available as part of the subscription. So I think it's quite genius. So I'm curious to see how it plays out, and I'm sure we'll learn more. That's why I asked the question because we're so conditioned to learning it one way, Matt. I think we need to better understand how to unbundle all these different services and see how it might be ascribed to a user of Remitly ON. So thanks for going through that. I think you touched upon a lot of Remitly ONE. Maybe to drive it home, it's good to talk about Flex, if it makes sense to pivot to Flex. So on the -- it's not a secret. Short-term liquidity products are hot right now, at least in fintech. And so buy now, later, we include in that instant loans, spare financing, all part of that. Here are you're going after it with Sow pay later. So how does it work? Give us a little bit more on the terms and the eligibility, the limits and whatnot, just a -- just to start to ground us.

Yes. That is a lot of what we will talk about tonight, the Remitly Reimagine event. And so I don't want to overshare before that. But that's exactly what we'll go into more depth on is what Flex is, how it works, what you get with a Remitly One membership, how much a Remitly One membership costs. So I would say tune in tonight for a lot of details on that.

Okay. Yes. I mean you've given us some clues, but it's similar to BNPL and Spirit, short-term liquidity. But your underwriting, you've mentioned your data advantages. What's proprietary? I mean you see a lot, but you don't necessarily see the income from a direct deposit that maybe a neobank might see, Matt. But you are trusted. They're giving you a lot of their part earned income to send money back home. So you do see quite a bit. Tell us more on what you can share on your underwriting advantage.

Yes. Yes. I think that I go back to when I started the business, I was living in Kenya, and I was working for Barclays Bank Kenya. And folks forget that in markets like Kenya, there aren't credit bureaus, at least they weren't at the time this was 14 years ago. And I guess how Barclays Bank Kenya did credit underwriting, payroll. That was how they did it, right? Makes sense. And I think that there's analogies. Obviously, we're talking about folks in the U.S., but you could have somebody who moved from Kenya to the U.S. or you could have somebody obviously, that moved from a variety of countries that we serve. One, they're not going to have necessarily a credit history that we can -- that a business can rely on even in the country they came from. Although, by the way, that still exists even if a customer comes from like the U.K., it's broken how like that customer who moves from the U.K. has to build credit in the U.S. So I think it's a broad problem. Let's take the Kenyan example, where it's even a bigger problem, moves to the U.S.

And I view things like international payments, which are often used for daily living expenses, rent, education, things like that, a little bit akin to payroll, right? And obviously, we're talking about the sender, not the recipient in this instance. But that's exactly what we've seen. And we have seen that it is a good signal for various credit underwriting purposes. And then we have a lot of other data on our customers as well. But we're excited about some of the signals that we've seen since we launched Flex. And we think, again, that gives us the unique right to win within this segment.

Yes. No, I think you got a lot of interesting data for sure. One more question on is everyone on the Investor side asked me to ask you, right? Will you be funding and bearing the credit risk? Will you be taking on some forward flow contracts at some point as this grows? What's the path for funding it?

Yes. I would say that, look, right now, we are in very early stages of Flex. And as we think about it, similar to the example Matt gave, we have a lot of history on the customers, and that gives us a lot of confidence in being able to, first of all, give the credit. Secondly, at the early stages, fund that as well. We have a strong balance sheet. And as we go further along in the journey in Flex and as we see the product market fit, we'll absolutely assess other options to say should we fund it in a securitized way or other means. And we'll also be very, very cost responsible here because we want to make sure that the cost of capital is real, and we want to account that in our business model and economics, even though it is self-funded or funded externally. So irrespective, we will keep that as a principle.

Okay. Good. Now we find one more. On the wallet, just to hit some of these questions front, I know you've covered some of it, and you'll give us more. But maybe I wanted to ask you what it is versus maybe more importantly, what it isn't because there's a lot of different wallets out there on the store value side, and a lot of them have links to debit cards and award models and things like that. So maybe start with that?

Yes, absolutely. It is a borderless store value, and it's multicurrency, starting with Fiat today and then USTC this month. so Stablecoins this month. And it's built inside, as I mentioned, the trusted cross-border platform that our customers already used. And where we differentiate again is that last mile usability, so customers can hold value, including Stablecoins, but then you use it through the same global payout fabric. And as the wallet more excited. We're just getting started. I think it's not an add-on, it's a durable node to the ecosystem that we're building.

Right. It's an important distinction. So I know you announced partnerships with Bridge and Circle Bridge has been very active in the space and giving a lot of attention. What do they bring to the table?

Yes. So Bridge unlocks our ability to do stable coin disbursements as a payout option. So in addition to the billions of bank accounts mobile wallets and cash pickup locations, we can disperse with Bridge strike to Stablecoin wallets across the globe without compromising speed, compliance, trust. And so it's plugging in new rails to a platform that does that already very well. That's bridge and excited about the partnership.

And then on the circle front, are you doing any hinting with their new own blockchain a the cross-border payments initiative that they've launched? Just curious how that play into it?

Yes. Two things with Circle and USDC. First is the ability to let customers hold a stable value, stable store value alongside Fiat, especially in volatile currency markets. And again, we'll be launching that, starting in the U.S. this month and then rolling out to new countries over time.

And then the second circle partnership gives us a treasury team, 24/7 settlement to instrument and improve FX, treasury, cash management. And so those are the 2 things with Circle back end as well as front-end customer-facing wallets.

Okay. Good. I know I don't want to take up too much more of your time. This is so great. just bridging it into the Stablecoin discussion just to simplify it for us. I mean, is there real demand? You talked about USEC, I heard you and Will talk about the volatility and the depreciation of certain currencies, and that is really tough for some of these highly volatile FX nations, but tell us more about what's the real demand here for it?

Yes. I think that the world is a big place. And I think demand will vary depending on the country, but there's absolutely demand to hold a more stable currency in a variety of countries around the world, not all, but a variety of countries. I think about -- people obviously think about things like Argentina, Zimbabwe that are known as hyperinflation. I actually like to use the Turkey example. In the last few years, if you own Turkish lira, if you held the Turkish lira, it has devalued by 80%. I just think we lose concept of what that looks like, especially sitting in the U.S. of how foundational it is to hold a more stable value and a more stable store value and currency because we haven't lived through that kind of inflation, right? And so at least in recent memory. And so I always go back to the customer. There is absolutely a customer problem to be solved when it comes to storing a more stable currency in more volatile countries and currencies around the globe. And with our payout network, we think we have the ability to offer those kind of savings accounts across the globe over time and then give customers the ability to move front savings into local bank accounts, cash pickup, mobile wallets, ways that customers can then use those funds that they can rest easy and with more peace of mind that their currency is not being devalued at the rates that I mentioned in countries like Turkey.

Yes. No, that definitely makes sense. I mean I feel like the craze of stablecoin has calmed down since the summer for sure. I think Will has talked about that. But the one thing I've said to investors for a while, Matt, is that you've been very smart on this subject. I mean you work with Libra from the very beginning, and that was -- I think you were one of the first to partner with them when Libra got off the ground. So you're aware. I'm sure you've learned a lot. You're talking to all these different disruptors. So this evolution to get here, what would you say is maybe underappreciated about what you've learned and why it's net positive for Remitly and not net negative, which some of the skeptics might argue?

Yes. I'd say 2 things. One is regulation matters a lot and will vary depending on the country. So that will be really interesting to follow how that plays out. And that's one of our core competitive advantages. Since day 1, our -- one of our first few hires was our Global Compliance Officer, used to ramp compliance for Amazon Payments. And that's foundational for us.

So one is regulation, which I think we're well suited to help navigate on a global basis. And then the second is I don't buy the thesis that stablecoins will completely replace local currencies. I think they'll be part of an ecosystem. They'll be part of multicurrency accounts. But both because of how commerce is done in most countries and because of governments wanting to have their own fiat currency in most countries, not all. Some markets are already dollarized. But I think the vast majority of countries, there will be a demand to hold a stablecoin in stable currency to the extent governments will allow it. But the second thing is you have to be able to do something with that currency in local fiat currency or even exchange between various stable coins.

And that's where we excel, whether that's the billions of bank accounts, mobile wallets, cash pickup locations, going from stablecoin to -- going from crypto to crypto, crypto to fiat. And -- so to the extent there's savings that solve that pain point on a global basis, which I think there will be in stablecoins, being able to use those stablecoins in a way that is fungible and valuable and fast, that's where we can add value. So those are the 2 things. Regulation, being able to use the funds, we're going to both those things.

Good. Anything else we have on Stablecoins?

That's fantastic.

We're almost out of time, probably over time actually. Let's make sure we hit something on Agentic AI quickly, just the cost versus revenue opportunity and how you see that examples. And if you could also just talk about WhatsApp and what might come behind that and how that's been taken so far by users, ask it all together.

Yes. It's the question is revenue versus cost. Well, I was going to say both, but revenue is what I'm even more excited about. We're obviously driving a lot of efficiencies as well. But specifically, I think we can use Agentic AI to meet customers where they're at. So the WhatsApp product that we launched, we took our virtual assistant that we had built internally to do customer support. We add additional use cases, and then we're plugging it into platforms like WhatsApp, creating a great opportunity for users to come and interact and build trust with Remitly in a really seamless, low friction way. And then it also can power personalization, which helps build trust, intent prediction, dynamic onboarding, which I think from a revenue standpoint, the reason we're 3% of the market is because our business -- the foundational thing is trust. And I think that we can use Agentic AI in some of those ways to broaden access, increase conversion and improve growth. Really excited about it.

And on the WhatsApp side, just what's the latest there? Is there more potential commencement or partnerships that you see that could build from that?

Yes. It's both. We've integrated into WhatsApp. So that is live and showing early traction. And then we're leveraging that same virtual agent to be able to plug it into other messaging platforms that you can imagine that will be coming soon.

Okay. So that's on the company.

Yes.

I know we're out of time. We talked about a lot of different things. Thank you, of course, for the time. But you've said many times here in other forms, right, just getting started. Product velocity, like I said, is really important for the sector now. Can we expect a regular cadence of product updates from the company starting with this keynote tonight?

Yes. And again, that ties the pivotal kind of moment for us, but yes, and very excited about tonight and very excited about what's to come.

Okay. Good. Well, thank you guys for the time. I will be there and eager to see would you unveil, but I appreciate you guys spending the time that you did.

Thank you.

Thank you.

Good to see you guys. Thank you.

All right, everyone. We are going to get started. I'm going to get a quick disclosure out of the way first. So we are required to make certain disclosures and public appearances about Goldman Sachs' relationship with companies that we discuss. The disclosures relate to investment banking relationships, compensation received or 1% or more ownership. We're prepared to read allow these disclosures upon request for any issuer. However, they are available to you as clients in our most recent reports and on our firm portal. So with that, I'm Will Nance. I cover payments and fintech here at Goldman Sachs. We are very excited here to have Remitly Co-Founder and CEO, Matt Oppenheimer as well as CFO, Vikas Mehta. There has been a lot going on in the cross-border space. And in the last few months, it's been dubbed stable coins summer. The investor interest and how stable coins could reshape various parts of the financial ecosystem has been very elevated, but Remitly has also been very busy this summer and had a number of product announcements on their most recent earnings call, shares reacted pretty favorably.

We want to spend a little bit of time today digging deeper into both of those things. And so we're going to spend a little bit of time talking about some of the new products and some of the recent developments from the Remitly earnings call. and then we're going to dive deeper into the topic of stable coins and how they impact the remittance and cross-border industry at large. So let's start off with a couple of the product innovations. Matt, Vikas, thanks for being here. Really appreciate you guys taking the time to do this.

Thanks, Will. Yes, great to be here. Really excited about the conversation.

So you guys had, I think, one of the biggest product unveilings that I can recall since the IPO, Matt, I think you kind of deemed a bit of an inflection point in the trajectory of the company in terms of the amount of products you're rolling out soon. There's an upcoming product demo where we will hear more. But maybe just high level, can you level set for what are some of the recent developments on the product side that you guys were excited to share with us on the earnings call?

Yes. Thanks, Will. Definitely an inflection point, defining quarter for Remitly, and we were excited to talk about not only how we're extending the platform that we've built to serve new types of customers. So Remitly business we've talked about in the past, but continued trajectory there. high-dollar senders we've talked about and then also adding new products to our existing customers in terms of Remitly One, which is the membership product that we'll talk more about at Remitly reimagine in September.

And within that, things like Remitly Flex, which is our Send Now Pay Later solution as well as the Remitly Wallet, which will obviously connect to the stablecoin conversation that we'll talk about. But all of that is in service of the vision that we have, which is transform lives with trusted financial services that transcend borders, and more than happy to go into more depth on any of those areas you want to talk about.

Great. So there's a lot there. Let's -- you started on Remitly business, so maybe that's a good place to start. You guys have mostly focused on the consumer side of the cross-border since the company's founding. You've been talking the last couple of quarters about enhancements to the KYC process and some changes that you've made to be able to accommodate micro businesses on the platform. Can you talk a little bit more about those product enhancements and maybe what it's taken to kind of broaden out the aperture of the platform?

Yes. Well, Remitly business that's interesting was born from the fact that we had a lot of customers who were small businesses that were coming to our platform and trying to use it. And that was a signal to us that, one, we have the platform that's really unique and special in terms of speed, reliability, affordability but also extensible and serving an unmet need of customers that just historically have not been served.

And so what we found is that, to your point about some of the product improvements that we've made, the primary thing we did out of the gate was just we changed the KYC from -- know your customer to know your business and having an automated KYB flow. But then we've started adding things like real-time watch list screenings, industry-specific attestation flows, expanding the types of businesses that we can serve.

And we're in the process of rolling out some high-impact features that we've heard from our customers around bulk and recurring payments, transaction labeling, streamlined reconciliation tools. But the growth of it has been very exciting. And when you take a step back, we've talked about our total addressable market in terms of volume being $2 trillion. This expands at 10x to $22 trillion total. And as we often say Remitly, it feels like we're very much just getting started. And I see that in the overall growth of the Remitly business volume user base, as we talked about, those users also have a much higher lifetime value. But I also see it in customer stories. And so if you look at examples like a customer named Tony that we were talking about internally who's based in the U.S. runs a small business that manages short-term rentals in the Dominican Republic. And he actually heard about Remitly from one of his contractors who manage the repairs for some of his properties. And before Remitly was doing wire transfers and other expensive slow options. And now he's a Remitly business customer, and he relies on Remitly business to send money to his overseas contractors out there, big opportunity for us uniquely to serve them.

Yes. And I guess what else can you tell us about some of those customer profiles. I think the people in the U.S., it's a very large market and very domestic centric. I don't think -- there's not always a great understanding or an intuitive understanding for what these businesses what these cross-border needs look like. So anything that's really surprised you or the types of businesses that you thought I didn't know that was a thing, and now they are, and now we're helping them.

Yes. I would say, the biggest area, and this is why we started by calling up micro businesses, although we've expanded to Remitly business, given that I think over time, there's a wide range of businesses that we can serve. But if you think of what we can uniquely do out of the gate, it's that small business that maybe has 5 or 10 contractors, the freelancer space is very large in terms of freelancers needing to get paid from folks that they're working for in the U.S. or Europe or you name it.

And you've got 5 or 10 employees. You don't need a lot of bells and whistles. You need an affordable which -- given our unit economics and how we've optimized that for a low dollar tender, we can do uniquely well. You need a fast service which again, customer sending $250 in our kind of bread and butter out of the gate, they have to have a fast service because it's emergency medical expenses, it's paying for things like basic living expenses, et cetera. So the micro business needs that they have like freelancers or like Tony's example, paying contractors, we uniquely do incredibly well.

And so I would see us starting in that micro business segment and then continuing to both move upmarket and continuing to add new geographies. So we're in the U.S. now, but you'll hear more from us soon in terms of how we're rolling out that capability to other geographies where we already have the licensing and infrastructure.

That's great. Maybe that's a good segue to the high-value centers. This is something you've been talking about for a bit, I think starting as long ago, it was about a year ago, you started talking about Remitly for seafarers, which I think you mentioned is also a very high dollar amount Ascend where are we on the rollout? And what can you tell us about the transaction economics here? And I think related to that, I'd also be curious to hear your thoughts on just what this does to your corridor mix because my sense is that, that may look a little bit different than your traditional remittance corridors?

Yes. So overall, really excited if you start with kind of the punchline output, year-over-year send volume growth of over 45% for customers spending more than $1,000 and the mix increasing 300 basis points year-over-year to those high dollar centers as we categorize them. So lots of growth there. I think when it comes to corridor mix, it certainly opens the aperture for us to serve a wider range of customers. that are already building brand awareness and affinity with Remitly.

So I think about like we did ads in the Heathrow Airport as an example. And I think that we had a lot of customers who have been in some of our historically large corridors that certainly saw those ads, but we also saw folks that were traveling within Europe, from U.S. to Europe, a lot of other countries we serve. And so I think it makes the marketing dollars that we're deploying even more efficient, more effective. But I also think, well, to your point about corridor mix, while it will cause a shift in corridor mix over time. There's also a lot of high dollar senders in the corridors that we're in. And historically, we were putting, I think, transaction limits on them that we're prudent, but we've improved leveraging machine learning, leveraging the data that we have, leveraging the sophistication of our compliance and product teams to have more precise not tier limits that are kind of rudimentary in some ways, but more precise algorithmic approaches to assigning the amount of customer consent based on their specific risk profile.

And so I think that we have a lot of opportunities in our existing corridors and new corridors, and you see that in the overall growth of that segment. You see it in the overall mix shift. And I think we're uniquely positioned again to be able to take this platform that, in some way, served the hardest customers to serve that will continue to grow and serve but extend it and be able to add additional customer types. Like what we call high dollar centers. And one other example to the point of having customers that are in the corridors that we serve, there's a customer named Prasant who we were also talking about internally, signed up with Remitly in 2019. And initially, he sent just a few dozen smaller transfers to support his family in India. And he chose Remitly because this is his words, it was straightforward and had no hassles. Since then, he's completed over half a dozen cross-border payments through Remitly totaling tens of thousands of dollars each to support his family and manage investments. And so it's customers like Prasant, who I don't think we were serving as well as we could in the early days. We've just expanded that platform to be able to serve customers like him and customers in a lot of other geographies more effectively.

And I know one thing that always comes with higher risk limits on the transactions is the potential for higher fraud. That's remained relatively well contained, but anything you can share on sort of the results from some of the sophistication of the new risk limits that you've put on in terms of managing higher levels of sand with lower levels of fraud, et cetera.

Yes. We have not seen increased fraud rates for higher dollar centers in terms of that being any sort of cause for increased fraud. I think that if you take a step back and you think about the fraud vectors also applied a $250 transaction being picked up in pickup methods like cash. Larger transactions tend to be bank to bank. And so there's offsetting reasons why there might be a lower risk profile as well. And I think that we, again, have a competitive advantage when it comes to our fraud systems. It's largely been compliance innovations, I would say, that have enabled us to do it in a very risk-based way and have a more sophisticated approach to our higher dollar centers.

Makes sense. And then just on this idea of kind of more sent to send type markets, U.S. to U.K., U.K. to Continental Europe, et cetera, can you just talk about like the differences in sort of operationally what it's like to operate in those corridors? How FX spreads, on-ramp off-ramp costs, what does pricing and unit economics look like in some of these corridors relative to some of your more traditional corridors?

Yes. The punch line is the unit economics in those corridors are quite favorable. And they're favorable because when you're sending a $10,000 transaction versus a $250 transaction, a lot of folks focus on take rate. But you can do the math. In terms of take rate, obviously, is the price divided by volume. If you increase the multiple of $10,000 versus $250, that can be a much lower take rate and still be a very profitable transaction and very profitable customer.

So that's point one. Point two is you tend -- in those -- in higher dollar centers, you tend to have less, or very little cash pickup. It tends to be more digital disbursement, usually bank accounts, sometimes things like mobile wallets. Those disbursement options tend to be, as you'd expect, lower COGS, lower variable cost for us, which can increase profitability and also gives us the opportunity to pass along savings to customers compared to the overall average.

And then with our scale, we have been able to drive down costs on behalf of customers because our pay-in and payout, which are the 2 largest kind of variable costs. 4 years ago when I started the business, the rates we were getting could not be more different than the rates that we're getting now, given that we're sending tens of billions of dollars. And so with that, we have an opportunity to really take, again, a segment that we've optimized, expand it to, in some ways, a higher profitable segment in a way that's really elegant and good for customers.

Interesting. Interesting. Maybe more profitable segment. That's an interesting characterization. I want to shift to Remitly One and knowing that you have an upcoming product event, I'm curious about anything that you can tell us about what this product might look like. I was interpreting from the comments that this could be a subscription-oriented product. Maybe if you could talk a little bit about the benefits of more of a membership model and what that might look like? And is this a platform for you to build a deeper relationship over time with customers than what you've historically had?

Yes. Yes. definitely a platform to build a more deep relationship with customers, definitely tune into the Remitly reimagined product Day on September 9, where you'll be able to hear more both for myself and Anker Sinha, who's our Chief Product and Technology Officer. So this will be an ongoing dialogue. But to give you a little bit more detail, Remitly One, I think, delivers tangible value to customers, starting with 2 products that you can get outside of Remitly One, and that's, as I mentioned, Remitly Flex, or Send Now Pay Later solution and our Remitly wallet.

But you only get the basic features if you don't have a Remitly One membership. So let's take the Send Now, Pay Later example with Remitly Flex. Remitly One members will get access to special benefits like flexible repayment schedules, free instant funding. And we've seen strong early demand and good repayment history for Flex as well as it being a powerful upsell for membership for the additional benefits. And then on the remote wallet side, we want to be able to give our customers the option to store multi-currencies both for Fiat and stable coins. I think that the early customer feedback in the U.S. there shows promise.

And Remitly One members will get access to special benefits like interest, cash rewards on balances, things like that. And so the important thing when you think about Remitly One is it's not a loyalty program. Loyalty programs are like what airlines do, loyalty programs or what maybe some of the traditional competitors in our space do. which is just like getting points or things like that for usage. Reline is adding value. The analogy I draw is something like Amazon Prime, where when you think about Amazon Prime in the early days, it made the core e-commerce experience better and their killer feature out of the gate was that free shipping. And for us, I think we've got a few, including the ones I mentioned, with Remitly Flex and the Remitly wallet, that add distinct independent value but adjacent value to that core remittance transaction. And when you look at a 5-year time line, you can see where that goes, right? You can see the wide range of benefits that specifically our customers. When you think about an individual and there are 250 million individuals plus businesses that on the individual front, live and work outside the country, they're born.

And financial services are just not designed for them. and even things adjacent to financial services, just additional benefits of coming to a new country and feeling that there is a company taking care of them and supporting their needs. That is a segment that I think has been underserved. That is a segment that we can serve with Remitly One via a wide range of benefits in the coming quarters and years, and we're incredibly excited about being able to talk more about it again on September 9.

That sounds great. We will tune in. I want to talk about each of those products. And I guess starting with Remitly Flex. So it sounds like there is a bit of a credit component to this. So I'd be curious to hear about your thoughts on that, the underwriting how you're thinking about the rollout? And then big picture, what are the pricing dynamics? And maybe for anyone who didn't turn into the earnings call, remind us about kind of the use case and the value prop of this product?

Yes. So if you think about Remitly Flex, it's up to $250. The customers can send and then they have to pay back in a short period of time. And if you look at that kind of send now, pay later, products, we believe it's very unique, and we believe it's very already, if I look at some of the customer feedback deepening the relationship with our customers because there are times where there is an emergency medical expense, where there's school fees, where, as I mentioned, there's just basic living expenses that a lot of our customers need funds to send at those times, and we help them with that kind of cash flow smoothing.

And so you -- the way it works tangibly, as I mentioned, up to $250 in credit to send. And if you are not a remotely 1 member, you get those funds in 3 days. So you have to wait 3 days. If you are Remitly One membership, and you pay that monthly membership fee, you get access to funds instantly, you avoid having to pay that fee to access funds and we'll go into more detail in terms of some of the other Remitly One benefits, but it makes that Flex experience significantly better for members of Remitly One. And we've seen the repayment rates be positive. We have a lot of expertise at the board and managerial level around thinking about the right metrics to measure the profitability of that product. And the important thing is it's because lending is such a broad space. This is a very short-term cash advance to our customers that I think has limited working capital implications.

And I think it also -- we have a lot of rigor and leadership around this to all manage it really effectively. So I'm really excited, and I think that the opportunity for us to add value to our customers in a unique way here. is big. We're seeing that in early customer feedback, both quantitatively and quantitatively, and we're just getting started when it comes to that product.

That's great. All right. And then I wanted to hit on Remitly wallet as well. This is 1 that I'm personally excited about because I think we have seen the journey that Remitly has been on at the time of the IPO with the Passbook product over the last year Remitly Circles product. And I'm curious if you could speak to the journey you've been on to get to this point of allowing stored balance functionality on the platform. How you're thinking about the rollout to the broader app? And anything you could tell us about just the implementation and kind of what was the lift like that it took to get here? And what's kind of left in front of you to get this fully deployed?

Yes. Yes, totally. So I think that the good news is if you look at a lot of the infrastructure, we had built out via that separate circle app that we had talked about. And so from a time line to integrate and launch, it was much faster because a lot of the -- what we call platform for our store value product was already there. We've now taken that integrated it into the core Remitly app in a way that doesn't disrupt the flow. That's why we wanted to do it separately out of the gate, and get that core functionality built out.

So we have that platform to be able to what we'll get to in a bit, talk about how do we think about stable coins evolving and how does that integrate into our product. how do we add other Remitly on benefits like interest like benefits or others that we'll talk about in September. And so it's a really foundational capability that is now embedded into our core app, and we're really excited about the platform that, that gives us to then add a wide range of benefits for our customers.

One thing that I know we chatted a bit about after the earnings call. When I think about a wallet and stored balance, one of the things that comes to my minder card products, things like debit cards. And so Curious if that's on the road map, if that's already baked in and just how you're thinking about the potential monetization opportunities that come from having store balances on the platform?

Yes. I think there's certainly a kind of foundational set of features that customers expect when it comes to holding a store value, a multicurrency account, et cetera. And so you mentioned debit cards. We'll talk more about those features broadly and specifically at the Remitly Reimagine event in September.

Sounds good. It's good teaser. Okay. I had one for Vikas here just because there were so many products that were announced. The guidance was obviously, you beat the quarter, you raised the guidance, it was very strong. If you could just talk about the -- how you think about the revenue contribution from some of these new products? And maybe clarify what's sort of baked into the guidance that you've provided to 2025 and how you think about timing of actually seeing a bigger contribution from some of these things?

Yes. Well, first of all, thank you so much for this opportunity. Q2 was a very strong quarter. And most importantly, as Matt said, we delivered breakthrough innovation. And as we say internally, we are just getting started. So very excited about the September 9 event and what we have in the offerings for futures. As you think about just the guidance, we are already 7.5 months into the year. And hence, we have a lot more clarity in terms of the outlook. This is very different from, call it, a quarter back or 2 quarters back when there was a lot of macro uncertainty also with tariffs and Remitly Stacks and other things. We feel we are in a much more clearer environment right now. A lot of those topics have been resolved. And with that certainty, it gives us a chance to give a guidance that's much more realistic and grounded.

So if you feel really good about what we have shared. The second is just mathematically, as you see the comps are really tough in Q3, especially. We grew 39% year-over-year last year same quarter. So it's more of the comps that's creating a little bit of difference from a quarter-over-quarter growth perspective. But overall, we remain very confident and we remain very excited. And again, as I said, the guide that we have given is much more closer to the pin, given just the macro certainties now and us having a very clear view of what our business will deliver.

Got it. That's very clear. Okay. I want to transition this conversation a bit towards stable coins and talk about some of the -- some of these dynamics, specifically as they relate to Remitly, but also you guys are experts at cross-border, and I know there's a lot of people trying to understand just how stable coins fit into that ecosystem. So Look, the company was founded 14 years ago, you've been diligently building out the capabilities that you have today to reach thousands of corridors. I think most people know cross-border payments are very complex but they don't really understand how they work and what it takes to actually move money from one country to another. So I thought it might be a good idea to just level set here how a company like Remitly actually conducts cross-border payments today and how you would go about building a platform like the 1 you have today from scratch?

Yes. Yes. Great question, Will. I think that -- and a great foundation for them, as we then talked about stable coins, which I'm really excited to do. I think it's -- when I look back 14 years ago, we set out to solve a problem that is still ongoing, but we've made a dent in which was a problem I faced in Kenya in terms of how inconvenient and expensive it was to get paid in British pounds, living Canyon shillings, give money back to U.S. dollars. It was all the things that everybody knows, expensive and convenient.

And if you look fast forward now, we made a dent in the sense that if you look at a $250 transaction, it's down to about 5%, plus or minus, at an industry level from about 8%. And we charge just over 2% on average. And that means more money getting back to folks love ones. But what I underestimated at the beginning and still, to your complexity point, is a journey is the sense that it's a very complex process to send money internationally that's fraught with delays and unexpected occurrences. And so we're proud 93% of our transactions are delivered in less than an hour, which is among the best in the industry, but delays still happen. And I think it's important to make that real for what it means because if you open an app or a competitor's app or you name it, you won't always see what it means when transactions are delayed. And so I wanted to -- there's an example, I won't say which competitor, but a trust pilot review, where a traditional provider said, my transaction was on hold for several days. despite sending my identification multiple times, the issue was never results. Customer service was unhelpful and I felt like I was being scanned. And you can kind of just feel the weight of that if it's for something like an emergency medical expense. And I actually think our traditional competitors just like us have really good intent to try to get money back quickly and efficiently. But the problem is hard to solve.

And when we talk about complexity, every step of cross-border transactions are inherently difficult. So accepting pay in, accepting funds, which we call pay in via pathwork of banks, payment processors, local wallets delivering funds, which requires a wide range of various payout methods, settlement times, last mile infrastructure. Foreign exchange, as you can imagine, real-time conversion, fraud prevention, compliance, treasury operations and then multiply that by 170 countries, 100 currencies, and you can kind of get a sense of why moving money globally is so hard, so costly and so full of friction. We have leveraged technology, and this will be how we segue into stable coins in a bit to improve that, both cost and reliability.

If you look specifically at digitization A lot of the transaction flow has been digitized. It's not by all means completely digitized yet, which folks can lose sight of but we're on that journey, and we're leading the effort when it comes to that. Because over the last decade, we've built this vertically integrated global platform that gives us control at every step, direct -- examples like direct integrations with local rails, intelligent routing to reduce cost and increase speed, embedded compliance and fraud prevention, a global operations network. And the results are more resilient capital efficient and customer-focused foundation that's hard to replicate because it takes time to work with all of these global financial services institutions. and build out the kind of network that we've built.

Last thing I'll say is I do draw -- Jeff Bezos was an early investor. This was back 14 years ago when Amazon was a lot smaller than it was today. And based in Seattle, I do think about that analogy of e-commerce. Like if you look back to the days of late '90s, early 2000s, ordering online was slow, expensive, unreliable. And that what we experience now when it comes to the e-commerce took decades to perfect. And when new technologies emerged, whether that was cloud computing, machine learning, robotics and the warehouses, Amazon was positioned better than anyone to take advantage of those technologies.

And I think we're in a similar position today in the cross-border space because we've built -- we've spent over a decade building a lot of the compliance infrastructure, the customer experience and knowledge of how this processing system works. And so that gives us not only the opportunity to serve customers well, but also when new technologies come out, whether that's real-time payment systems, whether that's stable coins as they mature, we're ready, and we're excited. And that's why we talked about it in the last earnings call. And so to answer your question to wrap it up, Will, if I were starting from scratch today, and that is the mentality of Remitly.

Amazon says day one, we say we're just getting started all the time. It feels like that. We focus on trust, we focused on cost efficiency. We focus on speed. But now we've got new tools, modern payment rails, tokenized settlement options like stable coins, orchestration layers that can dynamically route funds in real time. And those do solve some challenges, they don't solve all of them, regulation, fraud, liquidity management, market-by-market differences still need to be solved. But the goal hasn't changed. The customer problems haven't changed. The technologies we continue to leverage to solve those core fundamental problems.

Super helpful. All right. So I want to continue to sort of set the stage here and just kind of level set on some of the inherent costs in cross-border. And I think one of the things that comes up a lot in the stablecoin conversation is the lower cost of sending money, the fact that it's kind of limited to the marginal cost of sending money on the blockchain, which you can kind of ask them to to 0 over time. And so One of the things that I wanted to just discuss is when we see the numbers in the Remitly model, we see that transaction costs as a percentage of volume runs at about 70 basis points. And my understanding is that varies considerably based on corridor rails, et cetera. You just touched on some of the different variables. So maybe you could talk a little bit about what the marginal costs are in cross-border? And if there's any way to delineate that between on-ramp off ramp, the currency conversion, settlement, SWIFT in correspondent banking, what do you spend the most time thinking about the cost opportunity to minimize in the business?

Yes. Yes. So first off, you're right, it really varies depending on the quarter, our average transaction size, a lot of variables, and we look at the business that way, which maybe I'll come back to in a minute. But if you up-level it I think of like 3 large variable costs that I spend a lot of time and energy focused on and I'll list them in order of magnitude from highest to lowest. Off-ramping funds, on-ramping funds, and then I'm going to bucket other costs, which includes things like foreign exchange, risk, KYC tools, things like that, that we use on a per transaction basis.

Those first 2 are much larger than the third, which is an important context as we think about the rest of the conversation. Our ability to deaverage those costs, I think, has been a key competitive advantage. And I think it's, again, important to make it real with the customer example or 2. If you think about an ACH transaction from the U.S. to India, it might cost us only pennies if it's going to be an ACH transaction, regardless of transaction size. So you can imagine that's well below, it would be well below the average all up of 70 basis points because it's pennies as opposed to a debit card transaction picked up in cash in Mexico involves much higher on-ramp fees because of a debit card, more complex and higher cost for the disbursement because it's cash pickup. And we're good at that kind of precision, not only finding the right price for the right customer.

You can imagine across 170 countries, you also have to merchandise and explain that to a customer in a way that matches the speed of the payment method, the type of payment disbursement and the cost of all of those in a way that helps them maintain trust but also charges them the right amount because that could be a very different variable cost than in other customers. And so there's -- that complexity is where I would say, Remitly shines, not just in optimizing the economics behind the scenes, but explaining it to customers in a clear way. And so as technology evolves, we're getting even better at that, whether it's mobile delivery, machine learning, conversational AI interfaces, I think we have the opportunity to continue to innovate in that space. But at a punchline level, payout, pay in other costs, including FX risk, et cetera, those are the 3 biggest costs in that order.

That's super helpful. Okay. And then I guess, maybe we can bring stable coins into this conversation because that dovetails nicely. When you think about a stable coin transaction, what it can do for your network efficiency, what part of the transaction do you think it's most useful for in addressing costs? And maybe where is it not applicable?

Yes. So again, I always come back to what's the customer problem. And so even today, big opportunities to drive down costs and increase reliability and efficiency. And I think there's 2 ways that stable coins can do that. One is infrastructure. That's in that third variable cost, which is making the flow of money behind the scenes, faster, cheaper, more flexible, more transparent. And then the second is there is demand. And there has been demand for a long time. We can talk about this and how stables might solve it.

But there's demand if you are in an emerging market, there is demand to hold a more stable currency than the currency in that local market. And again, to make it real, I was thinking about Turkey. And let's just -- this is -- all the other examples I've mentioned are actual folks. This one, though, I just wanted to kind of picture a small business owner in Istanbul, okay, let's call her Laila.

Over the past -- over the last 5 years, and this is Turkey, there's a lot of countries out there like this. The Turkish lira has lost more than -- this actually surprised me, 5 years, Turkish lira has lost more than 80%, 8-0, 80% of its value against the U.S. dollar. And so Laila is working hard, let's say, to save for her kids education or maybe reinvest in our shop. But every month, Her savings are losing purchasing power. And so stability is not like a nice to have and it pales in comparison to like how much interest can I earn?"If the currency is deflated by has gotten less value by 80% over 5 years. That is a big customer problem. So those are the 2 problems. Problem number one, infrastructure. Problem number 2 is customers in emerging markets would like to hold a more stable currency. I'm happy to go through each. Maybe it makes sense to start with infrastructure because I -- but we can go through in whichever order you'd like in terms of [indiscernible].

Yes, let's talk about it.

Okay. You want to start with infrastructure?

Yes.

Okay. Cool. I think that we talked about how we're leveraging already the ability to use stable coin to improve our real-time treasury and liquidity. So instead of prefunding across 100-plus corridors, stable coins could help us move funds instantly, including weekends and holidays. That means less trapped capital, faster settlement and precision in how we deploy liquidity. I think there's opportunities for smarter FX management in tough corridors where there is illiquid or volatile currencies. I think that unchanged settlement gives us kind of always on transparency and auditable trail of funds. And then finally, I think there's elements of programmable money when it comes to imagining things like automatic refunds, instant partner networks, things like that.

So that's the opportunity. And there is a clear pay point. And I do think when we look 5 or 10 years out, there will be a lot more stable coins that will be used to improve some of the infrastructure of sending money globally. it's modest right now. It isn't making an impact now. We're investing more again in that 5- to 10-year time line. And when we contextualize it, that's the third most -- and it's a bucket of other costs that I mentioned in terms of treasury FX cash management. So that might actually even have a bigger impact for other businesses that are trying to manage global funds. For us though, again, if there's a customer problem, us being the customer in this instance and there's opportunity to improve the system, we're going to be investing ahead of the curve and really innovating in that space, which is what we're doing. So we can actually gain the benefits of some of those infrastructure and FX components that I mentioned.

So that settlement thing has come up a lot, I think. And I don't know if Turkey is a good example if there's another market that comes to mind where either the volatility of the currency or the capital controls into that market or just normal banking hours. makes it a pain for you guys to manage the settlement and the working capital needs of the business. And so again, if Turkey is not the right example, I'm sure there is 1 that you do have. But like can you make it real for us in terms of where you see the biggest friction on your own rails around settlement and where stable coins met actually, is it more the 9 to 5 banking hours thing? Or is it currency liquidity and capital controls that you're fighting more often?

Yes, it's more the 9 to 5 banking component. And what that means is if we're distributing funds to customers instantly because our product goes 24 hours a day, 7 days a week, then we have to -- we announced this last earnings, we have a $550 million line of credit, right? That line of credit has a cost. It's not -- if you do the math, not near as large of a cost of some of the other variable costs that I mentioned, but it would reduce the need for things like that $550 million line of credit because of the fact that we would have the ability to do the things that I mentioned in terms of real-time settlement.

That also could marginally decrease the foreign exchange exposure as well. But again, I'm giving the broader context for Remitly and then more broadly, I think about also companies who are moving have other foreign exchange needs, working capital considerations. I think there'll be action in this space, and it will be exciting and it will be beneficial for us, but I think it will be even more beneficial for companies outside of the remittance space. If you look at this specific area, because I think that as rails get faster globally, there are other companies that can reap even more benefits from that.

Okay. Okay. So then, I guess, the next was customer need, right? That was great on the structural costs. One of the things that you mentioned on the earnings call, which I thought was interesting was the Dominican Republic, where the delivery mix that involves someone physically showing up at the door to deliver cash. And I'm sure that's not something that sits at the efficient frontier of payments, but that's a market convention thing. It's not a remitly thing. There's clearly a reason why the customers want that. So how do you think about stable coins in that example, clearly, it's helpful, what needs to happen? And what are the benefits to the customer and also what are the events to Remitly in that scenario?

Yes, yes. So I think that this -- the problem of customers wanting to hold a local currency that's less inflationary like Laila story, I think is one that I think about a lot because if you think about it, it's not a new phenomenon. Like if you look at the top 1% globally, they have U.S. dollar accounts. They have the ability to hold multicurrency accounts across the globe. It's just historically, that's not been available to most consumers around the globe.

And so I think first, if you go into the actual problem we're solving, it's about the ability to store their savings, their savings in a more stable currency. I'm not talking about replacing all local currency. I don't think that is something that most governments will allow because they're going to want local taxes, payroll, any day-to-day transactions to happen in their local currency. But when it comes to savings, families that are setting aside for education, for home, for retirement in a country that has a more volatile currency, holding that in something like U.S. DC is ideal, okay? So there's 2 ways that we're solving that. One is, I mentioned that when you think about the Remitly wallet, the ability for customers in Turkey or Nigeria or Argentina or Zimbabwe or you name it, to be able to hold UDC is something that we want to enable customers to do in their Remitly wallet. And that is something we're incredibly good at because if you take a step back, what we are good at is we are good at the translation of feet to stable, stable to stable, stable to any of those perputations.

That is what we have done very well at. And so we can do this in a way that others can't because one, we built the trust of 8.5 million consumers, really importantly, because I think this is a question that I'm happy to talk about more. We can operate within a strong regulatory framework, which I think is an open question as we think about stable coins evolving.

And I don't know which of these is most important, honestly. The last is very important because if it's a savings account, there still has to be that last mile network for those funds to be able to be usable in real life for that customer in Turkey or Nigeria. And we have the ability to send a 4 billion bank accounts, 470,000 cash pickup locations, 4 million bank counts or mobile wallets and even things like door-to-door delivery in the Dominican Republic. That gives us a really large competitive advantage, especially in this adoption phase of folks wanting to save, but still needing to use those funds. So that's number 1 is whole USTC or another stable coin in a remit wallet. Number 2 is I mentioned that disbursement network we have. We're opening up that disbursement network to be able to send money to a stable coin wallet across the globe. And that is just an extension of how we have always built a network in the way that customers want to receive it. And in fact, in some markets today, like Honduras is an example, 100s is a dollarized economy.

So if you go to the really product and you try to send money to Hunters, you send money from USD to USD. There's a fee associated with it. If you send money to the Philippines because they have such a large population in the U.S. and their folks in the Philippines that want to hold USD. There is an option to send money from USD to a USD account in the Philippines. And so that construct already exists. I think stable coins will broaden the ability for more folks to be able to hold stable currencies. And we're going to be great at both giving customers the ability to store that with the remotely wallet or send that to other stable coins across the globe.

The one last thing -- I'll stop there, but I'm happy to talk more about any aspect of that, including some of the regulatory components, which I think are going to be really interesting as they evolve.

No, I definitely want to come -- that's actually my next question. But I guess before we move on to that, I just -- there's one thing that you didn't mention, which is just stable coins being an accelerant to digitization trends more broadly? I know this is something you've talked about, I think, actually in the Philippines over the last couple of years and the adoption of mobile wallet. So to go back to the #1 cost in this market is that off-ramp into the local economy are there areas like the Philippines, like the Dominican Republic, potentially some, maybe some of these markets where you see more demand for stable currencies, where your structural cost to the transaction is still very high. And if we do see the market adopt something like a stable coin, what could that do to your cost structure and to pricing trends more broadly in the industry?

Yes. In terms of where we're seeing adoption, it's super important that it's early in the sense that it's not -- we're not seeing widespread adoption yet. The great thing about our strategy is that, given the 2 elements that I just mentioned and the fact that we have trust with 8.5 million customers, we will have a front row seat to seeing where that adoption is actually taking place. And that can drive our product road map and other things that will help us capitalize on exactly what you said, well, which is digitization because I love it if a transaction is being sent into digitized form of disbursement like a stable clone wallet as opposed to cash pickup. And I love it because, one, it's more reliable. I can bring up that 93% of being delivered in less than an hour. And two, as you can imagine, there's a real cost to having cash picked up.

And so we have to pay that disbursement partner relatively more. then we'll need to pay to actually have funds delivered to a stable coin wallet. And so it is a continuation of this digitization trend that's very positive for our business and very positive for customers.

Got it. Okay. Let's talk about regulation, very important. We -- obviously, the passing of the Genus Act in the U.S. was a big catalyst for the stable coin conversation over the summer. One of the things that almost every company in the cross-border space Remitly included, has spoken about is just the complexity of managing the licensing and the KYC and regulatory requirements to move money cross-border, every end market, every receive market, every transaction and every customer needs to be kind of managed responsibly. So what did it take for Remitly to obtain the licensing to operate. And when you think about stable coins, like what do you see as some of the -- maybe the regulatory hurdles that need to be cleared to implement them?

Yes. Maybe I'll start with the second, and then I'll go to the first. I think on the second -- it's going to vary by country. Like the world is a very large place, and it's going to be fascinating to see how various. Actually, let me say the U.S., the U.S. first, let me take one step back. The U.S. with tiginiusAct has created regulatory clarity for stable coin issuance and the stable going ecosystem in the U.S. That should be applauded in my view, because the innovation can build off of that, and you're seeing that with companies like Circle and others. That regulatory clarity does not exist in a lot of emerging markets yet. And that is where I would argue a lot of the stable coin actually like usage when you think about that customer problem has the opportunity to grow the fastest.

The challenge is because that regulatory clarity doesn't exist in most markets, it's going to, by definition, very. I think some regulators will embrace it. I think other regulators will try to stop it, and they will be able to stop it because the moment you try to get the money out of that stable coin wallet to do something with it, that's often via locally regulated institutions, whether that's banks, whether that's telcos, whether that's large merchants. I think that that's where regulators can actually influence their local economy to not allow it. So yes, you could have somebody in an unregulated environment in Nigeria as an example, that holds USDC, but it will halt adoption if that customer can't do anything with those funds or it's very, very difficult, too. And so that's where I feel like we have a big competitive advantage. I shouldn't say if we feel like that's where we have a competitive advantage. We have relationships with financial services institutions across the globe, and we have a regulatory infrastructure that has taken years to build. And given that I came from banking in Kenya, we took it seriously from day 1. Our second hire was our compliance officer. He was the Compliance Officer for Amazon Payments. And he was with the company for about 10 years before he retired. We have an equally impressive compliance team now. But the reason I mentioned that is because building out the licenses whether that's e-money licenses, whether that's -- there's all different sorts of regulatory options, obviously, in terms of when we talk about the regulatory framework. Some are more catered towards banks, some are more catered towards digital payments, et cetera. but compliance is something that we have done well from day 1.

And I think that not only do we have a lot of the licensing infrastructure, just expertise to apply for new licenses should we need them. But also, we have relationships with highly regulated institutions in emerging markets around the globe. And so as we think about that regulatory question when it comes to stable coins, I think we can be on the forefront of helping solve that. And it connects to the pain point of, okay, I've got the savings in USDC, but what do I do with them? That is an area where given our scale size and credibility in this space, I'm excited for us to lead as this space continues to evolve.

Very good. That sounds exciting. We've got about 10 minutes left here. I have a couple more that I wanted to cover. I wanted to talk about fraud. I think that's 1 thing that gets missed a lot in this conversation. It's a huge costs that you need to manage, 1 of the, I guess, the scariest things that everyone in the payment space talks about is some fraud vector and not catching it soon enough. A recent example, I think Remitley fraud costs were elevated this past quarter by about 3 basis points off of 13% due to an isolated fraud incident. So I guess, maybe walk us through that, what -- how do you detect that and manage fraud. And how do you think about special considerations for managing fraud risk with stable coins?

Yes. I think that when you -- overall -- I'll kind of break out the question in 2 parts. On the first part, the I won't repeat what we had in our earnings. But yes, our fraud loss for the last quarter was right around 15 basis points. But if you look at that 1 specific targeted event and you exclude that, it was within the 13 basis point range that is within normality. And I think our team did a great job of isolating that and then being able to react. And we weren't the only ones in the industry impacted by some sophisticated fraud events.

So continues to be a big competitive advantage for us, continues to get better as we get more data because we can feed that into our own custom-built machine learning models to delineate between bad actors and good customers. that's part of delivering that 93% within an hour and continuing to get that up. And I think that only becomes more important in a stable coin environment because I think a lot of investors on this call probably know, but when you think about things like card schemes and other payment networks, while they aren't as fast, there's recourse and there's multiple layers of protections for the consumer. And so when you think in a stable coin world, where it's nonreversible and it's done. I think that the companies that will be able to actually deliver that instantly are ones that will not only have the right compliance infrastructure, but we'll do fraud incredibly well. And that's something that does get better with scale because you have more data, you have more analytics, you have more sophistication to be able to do some of the things that I mentioned in terms of delineating between good and bad customers. And so excited about -- well, I would say, an industry level, it's a problem that needs to be solved, excited about our ability to really lead the way and solve that.

No, I mean, 13 basis points is a very low level on an ongoing basis, and it's kind of in range bound for a very long time. So I know it takes a lot to get to that level and maintain it. I wanted to talk a little about -- we talked a lot about where the industry is headed, the opportunities longer term. To bring this conversation back more to the nearer term as we end the call, I wanted to go back to the Remitly wallet and some of the specific stable points features that you are thinking about rolling out in the near term. What do you envision for customers to be able to use stable coins on the Remitly wallet? And what is sort of the road map or time line for other use cases for stable coins, both customer-facing and internally?

Yes. I think that if you look at the wallet, I think that first, it's about continuing to build out the infrastructure to where folks have the basic features that they need. You alluded to some, I won't steal the thunder of some of the things that we're going to talk about in September at the product day, but I think that those are coming along nicely. And then I think it's about expanding the number of currencies and the number of countries that customers are able to hold those funds in both Fiat and stable coin currencies. And right now, you see USGC given the regulatory clarity and given their momentum, and so we're excited to have partnered with them. But we're well positioned to be able to expand to a wide range of currencies in terms of what customers want to hold, and we're excited to be able to do that for customers. And then you wrap it all in that Remitly One umbrella and membership model. And I am incredibly excited about being able to offer to customers a lot of benefits that they'll get in exchange for paying us a monthly fee to be a member of Remitly One.

And that's where I think a lot of excitement happens, not only within the stable coin space, but when you think about really accomplishing our vision of financial services that transcend borders, the last part of our vision. So that's where we started. It's a good place to start to wrap, which is making a huge impact on the globe, 8.5 million customers just last quarter, transforming lives. That's the first part of the vision with trusted financial services that transcend borders, -- and as I say, we often say internally a Remitly, we're just getting started. And certainly, with some of the latest technologies coming out with the fact that we're only 3% of the market, and that's just payments. I am incredibly excited about some of these things. We don't even talk about AI today, but stable coin AI, a lot of innovative new technologies as well as just the continued digitization of international payment system that has historically been cash and been slow. We are just getting started, and we are excited about accomplishing that vision of transforming lives with trusted financial services, the trends and borders.

Awesome. Matt, thank you very much for spending the time today. Matt Abacos, it's been great. I think I learned a lot. I know other people did as well. It's a fascinating space, and it's 1 that I know there's a lot of demand for people to learn about, and I think you've given a lot of people a lot of stuff to think about. So thank you. I hope you guys have a great summer. Thanks for doing this, and we're looking forward to seeing you at the Goldman Sachs conference in San Francisco in a few weeks as well as at the product event on September 9.

Likewise, thanks so much, Will. Really enjoyed the conversation.

Thank you, Will.

Good day, and thank you for standing by. Welcome to Remitly's Second Quarter 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, Luv Sodha, Investor Relations. Please go ahead.

Thank you. Good afternoon, and thank you for joining us for Remitly's Second 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 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 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, Luv, and thank you to everyone for joining us for our second quarter earnings call. Q2 was a defining quarter for Remitly. Not only did we deliver exceptional financial performance, but we also achieved breakthrough product innovation. Vikas will cover Remitly's exceptional financial performance in detail. So I will use my time today to focus on the new products, services and experiences that we have introduced into the market in the first half of the year. These innovations are changing customers' lives, expanding our TAM and further fortifying our business model, positioning us to shape the future of global financial services.

Our vision continues to be clear: to transform lives with trusted financial services that transcend borders. With over 8.5 million customers, we are no longer simply enabling cross-border peer-to-peer payments. We are becoming the modern financial platform for globally connected people and businesses. Today, I am excited to share the momentum behind our product innovation engine and why Q2 represents an inflection point for Remitly across multiple dimensions.

I will highlight 4 core focus areas of product innovation in 2025, shown on Slide 5. First, I'll start with our product momentum on Remitly business. Second, I am excited to introduce Remitly One, a first-of-its-kind membership for customers with cross-border needs. Third, I will share our innovative Stablecoin initiatives. And fourth, I'll showcase our approach to Agentic AI to create a more personalized, frictionless experience. In all these areas, we are building on our existing strengths as well as leveraging new technology innovations to further strengthen our lead.

Let's dive deeper into each one, starting with Remitly Business. With Remitly Business, we expanded our TAM more than tenfold from approximately $2 trillion to over $22 trillion as we aim to serve the 1.5 billion freelancers and millions of small businesses increasingly paying international contractors, vendors and employees. We are starting with small businesses and freelancers in this category who primarily need reliable, fast and affordable service, something that Remitly does uniquely well.

Formally launched in the U.S. in Q2, Remitly business is already emerging as an engine of growth. Built on our proven differentiated money movement infrastructure, it delivers the same intuitive click and send experience our consumer customers love, now tailored for the trust, control and compliance standards small business require. We are excited about upcoming launches in the U.K., Canada, Australia and the EU alongside vertical-specific onboarding flows, which will further accelerate our growth and broaden our global reach. With fast onboarding, automated eKYB and instant reach to over 100 countries, businesses can go live in minutes.

Our transparent competitive pricing is differentiated, while built-in fraud detection and real-time attestation help ensure transactions are secure. We're also rolling out additional features like bulk and recurring payouts, payment requests and streamlined reconciliation to simplify operations and support growth at scale. We are seeing strong early momentum and have onboarded thousands of businesses in Q2. Average transaction sizes are nearly twice as large as those of our core consumers. Thus far, retention signals are also tracking ahead of our expectations, leading to business customer lifetime value roughly 6x higher than consumer centers.

We are confident that Remitly business, anchored by an unrivaled customer experience and best-in-class pricing will be a contributor to sustainable revenue growth, margin expansion and long-term shareholder value. Looking ahead, Remitly is becoming the platform of choice, not only for individuals, but for the millions of businesses powering the borderless economy.

Moving to the second area. I am thrilled to give you a preview of Remitly One, a new membership program uniquely targeting cross-border needs. Remitly One will launch in September. With Remitly One, we are announcing not just another set of features, we are launching a bold new relationship. For the first time, customers can become members of a platform customized to address their cross-border financial needs. Remitly One is our first-ever membership program, designed not around transactions, but around customer relationships. It's a single, seamless membership that brings together cross-border payments with financial products to store, spend, grow your funds, get liquidity and other value-added services, all through a consistent and optimized experience.

Remitly One will be anchored at launch with 2 initial products, Remitly Wallet and Remitly Flex. Wallet and Flex are available stand-alone to customers today, but Remitly One members will get unique benefits with their membership.

Let me double-click into Remitly Wallet and Remitly Flex. Remitly Wallet will serve as a secure multicurrency store value for both fiat and stablecoins designed to meet the needs of our customers. Fully integrated into our platform, the wallet will allow customers to manage balances, plan payments and engage with their finances in a centralized trusted environment. It will provide access to both fiat currencies and stablecoins, offering a safe, flexible way to hold and use funds across borders.

Early customer feedback in the U.S. shows strong promise with the Remitly Wallets potential as a daily financial companion. Remitly One members will get access to special benefits that are like interest such as cash rewards on balances as well as other benefits like cash back on transactions and dollar credits for using their wallet.

Remitly Flex is our flexible funding solution, offering short-term liquidity, allowing eligible customers to send now, pay later. This structure provides an essential safety net for time-sensitive payments like medical emergencies or tuition without any interest or late fees associated with traditional lending. Importantly, Flex is powered by our proprietary transaction and other customer data, giving us a unique real-time view into customer behavior, cross-border payment history and financial patterns. This allows us to consider risk responsibly and without friction in customer categories where others cannot.

Remitly One members will get access to special benefits like flexible repayment schedules, free instant funding and more. We have seen strong early demand and good repayment history for Flex as well as powerful upsell to membership for the additional benefit. Remitly One, its benefits and the underlying offerings like Wallet and Flex will be integrated into the Remitly experience, accessible from the same app, our millions of customers already trust. There will be a unified experience that will scale with their needs, no learning curve, just more value every day. And this is just the beginning.

Remitly One is the foundation of a new ecosystem, one where membership drives daily engagement, emotional loyalty and long-term financial growth. We will continue to add an expanding set of benefits, all designed for their lives when they need them most. We look forward to showcasing Remitly One, including customer use cases and demos as well as what comes next at our upcoming product launch event on September 9, our first of a signature series we are starting called Remitly Reimagine.

Now moving on to the third area, Stablecoins. The toughest challenge for stablecoin users is ensuring secure on- and off-ramps to fiat currency. Our global money movement network, regulatory licenses and deep compliance expertise uniquely position us to integrate stablecoin capabilities at scale. Our stablecoin initiatives position us to lead the next wave of modernization in cross-border financial infrastructure through 3 specific initiatives.

First, customers will have the option to store and manage stablecoin balances along with traditional fiat in their Remitly Wallet. This will especially be beneficial for customers in inflationary economies with high currency fluctuations. We are in beta testing and plan to launch this in September, working with Circle, a financial technology company that is accelerating stablecoin adoption.

Second, customers will be able to receive cross-border payments in stablecoin compatible wallets, seamlessly rooted from our established fiat infrastructure. One of Remitly's core differentiators is our highly scaled fiat network, which enables instant cross-border transfers across 170 countries. We are excited to extend this network by integrating blockchain rails starting with stablecoin disbursement. This innovation enhances both our payout flexibility and global reach. The rollout is also in beta and plan to launch in September in partnership with Bridge, a Stripe company.

Third, for internal efficiencies, we've integrated tokenized U.S. dollar stablecoins like USDC into internal treasury operations to fund liquidity across global markets. This allows near instant settlement across time zones and weekends, which will enable quicker transaction processing, greater reliability and lower cost when customers send money with us. Together, these stablecoin initiatives enable us to modernize cross-border money movements firmly positioning us at the forefront of stablecoin innovation in cross-border payments.

Following the stablecoin update, the fourth area that I am excited to showcase is our approach to Agentic AI. At Remitly, we believe the next frontier of digital financial services will be intelligent, conversational and personalized. That's why we are building an Agentic AI platform for this future, purpose-built for customers who use cross-border financial services. Today, our Agentic AI-enabled support experience handles nearly 2 million real-time interactions with customers, resolving issues, predicting intent and adapting contextually, all while reducing cost to serve and increasing satisfaction.

We do not view AI merely as an efficiency unlock. We believe AI helps us generate revenue and bring new customers into our platform. As an example, based on industry data, a significant portion of cross-border transactions in the U.S. to Latin America markets are still conducted offline. Our Agentic AI innovations, including Remitly on WhatsApp, will enable us to drive this secular off-line to online shift. This Agentic AI platform is embedded directly into WhatsApp, the most popular messaging app in the world with nearly 3 billion customers and enhances customer acquisition and onboarding.

With Remitly on WhatsApp, we've reimagined the cross-border payment experience as a simple conversational flow, send money, check exchange rates, get help, all via WhatsApp. Our vision is to make Remitly trusted, embedded and intelligent wherever customers are, and it's working. Conversion rates for Remitly on WhatsApp are highest among customers who were previously transacting offline, proving that conversational AI can be a powerful on-ramp to digital inclusion. Remitly on WhatsApp is already available to our U.S. and Spanish customers sending to 11 countries, including Mexico and India.

Our platform innovation goes beyond WhatsApp. The same Agentic AI-powered experience can be scaled across any conversational interface where our customers live and communicate, whether that's Meta's Messenger, which is launching soon, conversational platforms that are emerging or platforms that haven't even emerged yet.

In a world where financial institutions are still adapting the basic automation, we are not only constantly looking for ways to stay ahead of the curve, we are helping define it. With Agentic AI, Remitly is building not just a better interface, but a smarter relationship, one that makes cross-border finance feel as seamless as chatting with a friend, and we are just getting started.

In closing, our vision at Remitly remains bold and unwavering to transform lives with trusted financial services that transcend borders. With over 8.5 million customers and a platform built for both individuals and businesses, we are a global fintech platform purpose-built for the digital age, meeting the full financial needs of global citizens and businesses who have long been underserved by legacy systems. We are doing this leveraging the latest technology, innovating with AI and stablecoins to deliver intuitive, agentic and trusted financial experiences. From enabling Agentic AI for cross-border payments to the launch of Remitly One, Wallet, Flex and our business product, we are not just expanding our platform, we are creating entirely new categories of digital financial engagement.

The thing that's most exciting is that we can uniquely do this given our scale. We've talked about our flywheel in the past, and our flywheel is working. We are delivering on our commitment to profitable growth, investing in high ROI opportunities that expand our TAM and extend our advantage. And we are doing so while accelerating innovation, expanding into new customer categories and unlocking massive TAM. We are proud of what we have built. We are energized about what lies ahead, and we are just getting started.

Now I'll hand it over to Vikas to walk through our financial and operational highlights from the quarter.

Thank you, Matt, and good afternoon, everyone. We delivered another strong quarter of growth, expanded profitability margins while also investing in innovation.

As shown on Slide 12, second quarter revenue was $411.9 million, up 34% year-over-year, and adjusted EBITDA was $64 million, representing a 16% margin. Results exceeded expectations with revenue $28 million above and adjusted EBITDA $18 million above the midpoint of our Q2 guidance. We again delivered GAAP profitability, an important milestone that we expect to sustain going forward. Before I dive into our quarterly results and outlook, let me address a macro topic that has been top of mind for investors, remittance tax. The one big beautiful bill, which applies a 1% tax to cash and other physical instruments exams digital cross-border transfers funded via bank accounts, credit and debit cards.

All of our transactions are digitally funded and typically passed through both bank KYC standards at the payment instrument level as well as incremental KYC standards on Remitly's platform, which gives us a structural advantage against legacy cash-based providers. We expect this tax to further accelerate the shift from off-line to online, benefiting Remitly when it's implemented on January 1, 2026. In short, this legislation is a tailwind for our business. And as Matt highlighted earlier, our product innovation around Agentic AI will further accelerate the shift from offline to online.

Now I will begin with an overview of our second quarter results and then share our outlook for the full year and third quarter 2025. Let me unpack the revenue growth drivers. Send volume grew 40% to $18.5 billion, driving the strong volume growth. Send volume per active customer increased a record 12% year-over-year. This was driven by strong growth, both in transactions per active customer and average transaction size as we continue to win share and gain traction with high amount senders and micro business customers. Quarterly active customers increased 24% year-over-year to over 8.5 million, in line with our expectations, driven by continued retention and strength in new customers acquired in the quarter. Take rate was 2.23%, in line with our expectations.

Now let me dive deeper into our revenue outperformance from a geographic and customer category perspective. A key dimension of our scale is geographic diversification. From a send perspective, U.S. revenue grew 35%, in line with last quarter, driven by continued share gains. Rest of the world grew 40% year-over-year, ahead of our overall revenue growth. On the receive side, revenue from regions outside of India, the Philippines and Mexico grew 41% year-over-year. Despite the overall remittance market to Mexico remaining soft in Q2, our Mexican receive business revenue growth outpaced our overall revenue growth. This outperformance is a clear indication that we are continuing to gain share in the Mexican market, growing meaningfully faster than the broader industry.

Besides geographic diversification, we are also seeing success in diversifying our customer categories. As we noted last quarter, high amount senders is a key area of strategic focus for us. Using AI, we are able to reduce friction and enable higher send amounts without compromising compliance. Combined with our deep partner integrations, we have raised transaction limits significantly and streamlined the experience end-to-end. This has led to a record year-over-year send volume growth of over 45% for customers sending more than $1,000, and the volume mix from these customers increased by 300 basis points year-over-year.

We introduced 2 new features, send to self and multi-corridor sending, designed specifically to reduce operational friction and unlock new use cases for expats, international professionals and globally mobile families. Given that high amount senders is a new category for us, we are also making deliberate strategic investments in competitive pricing to attract and retain this valuable cohort. And to accelerate adoption in H2, we have launched targeted marketing push tailored specifically to the needs and motivations of high amount senders.

Turning to our focus on driving profitable growth on Slide 13. Transaction expenses this quarter were $143.8 million and as a percentage of revenue were 34.9%. Excluding provision for transaction losses, other transaction expenses were $115.7 million, improving 175 basis points year-over-year as a percentage of revenue. The mix of digital receive 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 $28 million or 15.2 basis points as a percentage of send volume.

This came in above our expectations due to a sophisticated fraud incident in May. We responded swiftly, closing off the attack vectors and bolstering our already robust fraud detection systems. This was an isolated event and led to a discrete nonrecurring loss of $3.8 million. Excluding this onetime item, provision for transaction losses would have been $24.2 million or 13.1 basis points, consistent with our expectations.

Looking ahead, we'll continue to enhance our AI-driven risk models to proactively adapt to evolving fraud patterns without compromising the seamless customer experience that defines Remitly. As I've shared in prior quarters, RLTE expansion is an indicator of the long-term business model success. RLTE dollars grew 35% to $268.1 million, reflecting strong new and existing customer activity and economies of scale. RLTE as a percentage of revenue this quarter was 65.1%, modestly better than the percentages we saw last year.

As you will note, while there is a mix impact of high amount senders on take rates in the short term, over the long term, these customers help us drive incremental RLTE dollar growth. We are focused 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 spend was $79.8 million, up 10.4% year-over-year. As a percentage of revenue, it declined 422 basis points to 19.4%, reflecting improved efficiency. This performance was driven by gains in both digital and brand marketing as well as continued strength from word of mouth. In Q2, we also deepened our brand relevance with key audiences through high-impact sports partnerships. Notable ones include a multiyear sponsorship of the England and Wales Cricket Board, our partnership with Concacaf Gold Cup, a soccer tournament that reached record-breaking viewership this year and our ongoing support of Major League Cricket in the United States.

These campaigns are designed to connect authentically with our core customer base of global citizens, celebrating cultural connection and driving awareness in high-density corridors. Marketing spend per quarterly active customer was $9.38 in Q2, 11% year-over-year decline, underscoring our focus on returns from marginal investments. Customer support and operations expense was $24.6 million and as a percentage of revenue was 6%, improving 46 basis points year-over-year, continuing a trend that we have seen over the last couple of years.

Our AI-based virtual assistant and product improvements have enabled lower agent contact rates and strong customer satisfaction ratings. Technology and development expense was $53.4 million and as a percentage of revenue improved by 225 basis points year-over-year. Technology and development expenses grew 15% year-over-year as we become more efficient in managing our spend while delivering breakthrough product innovation. We are delivering on the metrics that matter most. In Q2, over 93% of transactions were disbursed in under NR, more than 97% were completed without customer support contact, and our platform delivered 99.99% uptime. These are not just operational steps. They are proof points of the trust we are earning at scale.

G&A expense was $46.3 million and was modestly higher as a percentage of revenue. We saw modestly higher provisions related to collectability of amounts due from certain processing partners with unique risk indicators in the quarter. We proactively assess the collectability of balances with various partners and prudently reserve when appropriate. 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 $64 million. We delivered our second consecutive positive GAAP net income quarter with $6.5 million GAAP net income, a significant improvement compared to a $12.1 million net loss in the second quarter of 2024. Stock-based compensation was $38.1 million and as a percentage of revenue was 9.2%, approximately 288 basis points lower than the second quarter of 2024.

Now moving on to our outlook on Slide 15. Given that we are 7 months into the year, we have a stronger line of sight into performance and underlying trends, which gives us greater confidence in our updated outlook. This guidance reflects a more realistic and grounded view of where we expect to land for the full year. For the third quarter of 2025, we expect revenue of $411 million to $413 million or 22% to 23% growth. As you will note, the third quarter faces the toughest revenue comp of the year. The majority of our revenue in 2025 comes from prior year cohorts, giving us greater visibility into the durability of our revenue growth.

If we unpack the revenue growth expectations further, we expect revenue to outgrow quarterly active customers due to continued strength in high amount senders and micro business customers. Growth in send volume per quarterly active customer is expected to increase mid-single digits, primarily by higher frequency of transactions and continued strength in higher amount senders and micro businesses. Consistent with recent trends, we also expect send volume growth to outpace revenue growth for both Q3 and FY 2025.

Higher transaction sizes lead to higher send volume growth, driving our LTE dollars higher even with moderating take rates. Given our traction with high amount senders and micro business customers, we believe volume growth is a stronger indicator of our future growth potential in addition to quarterly active customers.

For the full year, we expect revenue between $1.61 billion and $1.62 billion, reflecting a growth rate of 27% to 28%. This outlook reflects the outperformance in the first half of 2025, the confidence we have in durable customer behavior and strong returns from our marketing investments. Note, we will be lapping tougher comps in the second half of 2025 due to the outperformance in the back half of 2024.

Shifting to our adjusted EBITDA outlook. We expect Q3 adjusted EBITDA to be between $53 million and $55 million, translating to 13% margins. Starting with transaction expense. We expect Q3 transaction expense as a percentage of revenue to be in line with full year 2024. Please note, in FY 2025, we are lapping the benefits from key payment processing partnerships that we realized in 2024. We are aware of recent developments where some partner banks are introducing fees for API access, which may increase costs for fintechs that rely heavily on ACH. However, the vast majority of our funding comes through debit cards and credit cards. As we have shared before, transaction losses may vary from quarter-to-quarter, and we remain disciplined in optimizing customer lifetime value and rigorously managing risk.

Shifting to marketing. We expect our marketing investments in Q3 will continue to deliver strong ROI. We'll increase our marketing investments over the next 6 to 12 months to support initiatives around high amount senders, micro businesses and membership. We will make these investments while prioritizing efficiency. Our LTV to CAC was about 6x in Q2, while our payback period remained under 12 months. As a reminder, our marketing investments drive returns for many years beyond our initial investments given repeat behavior.

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 as we support product innovation. For the full year, we expect adjusted EBITDA to be between $225 million and $230 million, representing an adjusted EBITDA margin of 14%. We expect to generate modest positive GAAP net income in the third 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, respectively.

Overall, we expect to deliver positive GAAP net income for the full year. This outlook provides us with the flexibility to make key growth investments while at the same time, deliver efficiencies across our operating expense base. As part of this balanced approach to investing for growth while maintaining financial discipline, we are also taking thoughtful steps to strengthen our capital position. In late June 2025, we closed on an upsized $550 million secured revolving credit facility, replacing the $325 million agreement from 2021.

As our business continues to scale, this increased facility provides the additional liquidity required to prefund rising customer transaction volumes, especially around peak periods like holiday weekends when transaction volumes are significantly higher. This ensures we can continue to deliver seamless real-time money movement across global corridors.

GAAP profitability, strong free cash flow generation and optimism in our future give us the confidence to authorize a $200 million share repurchase program. While we continue to invest organically in our business, opportunistically investing in a share buyback program to manage dilution is also important to our capital deployment strategy. We do not have a specific timetable for repurchases and will act judiciously, consistent with our disciplined capital allocation approach. The share repurchase program reflects confidence in our ability to deliver for our customers while also building long-term value for our shareholders.

To summarize, we delivered Rule of 50 for the second consecutive quarter with 34% revenue growth and 16% adjusted EBITDA margins while also investing in innovation. This momentum reflects Remitly's diverse durable revenue growth along with profitability, and we remain committed to relentless innovation.

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

[Operator Instructions]

And our first question comes from Tien-Tsin Huang of JPMorgan.

Matt, I appreciate your enthusiasm here around all these fun initiatives. I'll ask on that, if you don't mind, just -- anything else you can share on the expected time line and the geographic phasing for the rollout of these products like business and Remitly One, Wallet, of course, the stablecoin remittances. And I'm curious if you can just comment on if you expect these initiatives to be accretive to both revenue and profit because it feels like there's a lot to do here to promote these initiatives properly to your user base. Is that going to alter your profit commitments in any way?

Yes, I'll start, and then I can let Vikas add on some of the latter part of your questions. Yes, Tien-Tsin, I appreciate the question. We are incredibly excited about both expanding to new customer segments like Remitly Business, which we mentioned we launched in Q1, continued to grow really nicely in Q2. And then excited about Remitly One, which is our membership product that includes 2 products that are already live, Remitly Flex, which is our send now, pay later solution and Remitly Wallet, which is the ability to store both fiat and over time, stablecoins as well. So incredibly excited about the foundation that gives us to continue to innovate, serve new customers, serve our existing customers with additional services. And I don't expect it to impact marketing line items, areas like that. I think that we have clear plans to be able to continue to grow those products.

Yes. Let me just add a few quick points. So first of all, we have given a detailed guide for Q3 and the full year. So that covers everything that we have discussed in all the new products. A few double clicks though that may be helpful over here. The first is, as we highlighted, we are seeing strong success -- early success with SMB, where the transaction sizes are larger, the retention profile is better. So clearly, that has its own dynamics with regards to send per QAU as well as take rates.

Beyond that, if you look at the P&L line items, thus far, we have not specifically invested in marketing in new areas, but now starting second half, we will be focusing with targeted campaigns on newer areas. So definitely, that's already built into our guide, but just highlighting that, which will, of course, drive additional marketing investments. But again, all within the envelope of what we have shared. In addition to that, tech and dev will also be an important area of investment, especially as we innovate. Overall, as I shared earlier, it's all part and parcel of our guide that we have given. So no specific changes and very excited about the innovation that's coming ahead of us.

And our next question comes from Will Nance of Goldman Sachs.

I would echo Tien-Tsin's comments on the new products. It's great to see some of the momentum and some of the investments that you've been making paying off. I wanted to talk maybe on the -- I'll just kind of pick on Remitly Wallet for a second. Maybe you can talk a little bit in more detail about the customer profile that you'd be going after, how you think about kind of cross-sell to the existing customer base versus maybe unlocking a different type of customer? And just how you think about unit economics in that space and pricing and just how it may alter the complexion of the business as that product sales?

Yes, absolutely. Happy to, Will. And I'm glad you can sense the excitement. It's definitely a defining quarter for Remitly. When it comes to the Wallet, we are excited about giving our customers the ability to store both fiat and stablecoins. And I think in terms of the types of customers that we can serve, I think there's opportunities across the board. I think that starting with our existing customer base, we have 8.5 million quarterly active users that I think have a need to store multicurrencies across the globe.

And then over time, I think that oftentimes, a place that we can capture demand is when customers move to a new country. There's a broad financial services set of needs that they have, getting money back to their families is where we focused on historically. And I think also getting that initial bank account set up is an area where there's a pain point. So I think that lots of opportunities there and really excited about what's to come.

And our next question comes from Ramsey El-Assal from Barclays.

Great results tonight. I wanted to ask you guys what you're actually seeing in the marketplace when it comes to stablecoin demand from your customers. There's obviously a kind of emerging market use case already sort of an inflation hedging use case. Are your customers -- are you getting signals that they're looking for you to provide these capabilities? Or is this more sort of like you're laying in these solutions just to be prepared as the market evolves, if that makes sense?

Yes. Yes. Thanks, Ramsey. Whenever I look at new technologies, whether it's AI or stablecoin, I look at what is the problem that can be solved for customers. And I think that the first problem that can be solved is exactly what you said. There is a demand in a lot of countries for customers to hold a less volatile currency. And I think stablecoins are a potential solution for that. The solution that we're offering when it comes to how to leverage stablecoins is, one, the ability to hold stablecoins as part of their Remitly Wallet. And then the second is we are incredibly good at getting funds to customers the way that they want to receive them. And we can do that via 4 billion bank accounts and mobile wallets.

We can do that via over 400,000 cash pickup locations. We can even door-to-door delivery in some markets where it's popular in the Dominican Republic. What we're excited about today is announcing that we'll be giving our customers the ability to send money to stablecoin wallets across the globe to give them another option of a way to send money back home to their families, and we'll be doing that in partnership with Bridge, which is obviously a Stripe company. And so I see those 2 solving the first pain point is customers in emerging markets wanting to hold a stable currency.

And then the second is we could be the potential customer. And we have already launched within our treasury team the ability to leverage stablecoins to improve our FX, treasury and cash management.

Now to your point, Ramsey, that's the future. That's where the world is headed. Modest usage now because sometimes technology takes time to adopt, especially in financial services. But I think we're investing in the future. We're ahead of the curve, and we're excited about what's to come.

And our next question comes from Cris Kennedy of William Blair.

Can you just talk a little bit more about your wallet initiative, kind of how you're thinking that your customers would utilize and spend those balances and kind of talk about the float opportunity for Remitly?

Yes. Yes, absolutely, Cris. And I'll build on a little bit more too of what I answered with Will. So I think that there is, as I mentioned, the desire to hold multicurrencies, whether that's fiat or stablecoins. And the exciting thing is we're putting it in the overall context of a membership solution. And so that's where Remitly One comes into play. Customers will be able to hold balances without a Remitly One membership.

But then by becoming a Remitly One member, they'll be able to earn interest like rewards to be able to actually increase those cash balances, and there'll be more seamless integrations with things like being able to send money. So we will talk more about the Wallet, about Flex and about Remitly One, the membership that gives customers additional benefits of those 2 products and others at the product launch event, Remitly Reimagine that I mentioned will be happening in September. So excited to share even more then.

And our next question comes from David Scharf of Citizens Capital Markets.

I wanted to just follow up on the stablecoin discussion. Given that FX markup is a significant component of the fee structure of any send, can you discuss how holding a stablecoin sort of impacts the unit economics? I mean, are we -- should we be thinking about a different revenue model for stablecoin type transactions, either on the send or receive side?

Yes. Thanks, David. I think the quick answer is I expect the revenue model to be similar. I think that what we are fundamentally good at and what will remain is the fact that we are good at getting one currency to another, and that could be fiat, stablecoin, stablecoin, fiat, it could be via cash pickup, it could be via a lot of the options that I mentioned. But doing that requires an enormous amount of infrastructure, an enormous amount of regulatory expertise and an enormous amount of risk systems that do it quickly and also at a low cost.

And so I would say that the model will remain similar, and we feel really well positioned in terms of our ability to drive stablecoin adoption given that we have always been and will continue to be in the business of currency conversion, and we're very well positioned to do that with stablecoin as we've been with fiat.

And our next question comes from Alex Markgraff of KBCM.

Matt, could you talk about Remitly business a little bit? I mean from a TAM standpoint, pretty compelling. You shared some unit economics. But maybe just some thoughts on competition and the pricing dynamic in B2B versus P2P remittances. And then just anything you'd flag on sort of first-party versus partnership type opportunities with Remitly Business.

Yes. Thanks, Alex. I would love to talk about Remitly Business. So Remitly Business was born out of the fact that we had a lot of customers coming to our platform, trying to use it. And it was not previously optimized in terms of a streamlined automated KYB meaning know your customer flow and a lot of other features that I mentioned in my opening remarks that small and micro businesses need. So the question is why were customers coming to our platform to use it in the first place despite the fact that there was friction in the early days. And it's because that segment of customers, we're talking about folks who are sending money to freelancers who might be on the lower end of the overall business or SMB segment in terms of average transaction size.

That segment, we believe, is not well served. And the reason it ties a bit to your cost point is because they do not need a lot of the additional features, but what they do need is a reliable, fast and affordable product. And what we've done in the consumer space is we have really optimized the unit economics for exactly that and really optimize the experience for exactly that. And so we're really excited now that we've actually optimized our product for small businesses. We believe we can continue to kind of move upmarket over time. I think that we can add the features that initially micro and small businesses require. And then over the medium to long term, I think that we can continue to serve a wide range of businesses because, as I mentioned, it's 10x the overall TAM, increasing our TAM to $22 billion. And we always say we're just getting started. We are very much just getting started with Remitly business.

And our next question comes from Gus Gala of Monness, Crespi, Hardt & Company.

I wanted to ask about the CAC per quarterly active moderation in the back half. Is it kind of -- I mean, you're talking about performance marketing to drive business, but is there under or beyond that maybe for the core business, are we putting in more in top funnel in the back half? Just help us think about that. And one clarification, if I can squeeze it in. The guide, you clearly raised by more than the beat. How much of that -- is any of that coming from new innovations? Clearly, the business part is some of it because it's been in market since Q2, but just help us delineate that.

Thanks, Gus. I'll take this one. Let me answer the second part of your question. If you look at the guide and the beat, I'd say, given that a lot of the new initiatives are early, in addition to that, as Matt clarified, Remitly One launches in September. So clearly early days. So a lot of the upside you are seeing is from the core business.

Now moving to your question around marketing. Let me clarify a few things. I think the first is we have seen a very efficient marketing engine with continuous 6x plus CAC to LTV, LTV to CAC as well as payback periods less than 12 months. So that continues to remain a strength for us. As we look at second half of the year, just comps are very, very tough. Last year, in the second half, we had a lot of efficiencies. The marketing per QAU really went up and in terms of just efficiency. And as we comp some of those tough last year numbers, it's just more of law of numbers there.

In addition to that, as we innovate and launch new products, we want to have a targeted focus supporting those newer initiatives. So I think a mix of those 2 is what you are seeing here in terms of the outlook of marketing what we have shared. But overall, marketing continues to be a very important lever for us in attracting new customers and building for our future.

And our next question comes from Zachary Gunn of FT Partners.

I also wanted to just follow up on the stablecoin dynamic. So today, if we break down your transaction expenses, pay-in and payout costs are each about 30 basis points of overall volume. So for transactions where customers want to receive cross-border payments in stablecoins, how do those relative economics compare, especially when you might have a party like Bridge involved who would want to share in those economics?

Yes. I think that -- great question. And I think overall, I think that it's comparable when you look at it as a disbursement option effectively. And then I think there's upside for us as we think about the Remitly Wallet product, where we're actually storing stablecoin value, whether that's earning net interest income in areas like that or whether it's earning other benefits, I think that there's lots of opportunity as we think about stablecoin adoption for the economics to work very well for us.

I'm showing no further questions at this time. I'd like to turn it back to Matt Oppenheimer for closing remarks.

Great. Thank you so much, and thank you, everyone, for the incredibly thoughtful questions. As always, I will end with a customer story. This one is from a Remitly Business customer, named Tony. And Tony shared with us the first transaction was flawless, and it was convenient and it was fast. So I have been hooked ever since. We thank Tony for his loyalty and for trusting Remitly to get money to his business reliably and seamlessly.

Thank you, everybody, for joining us. We appreciate your support. We are excited about the opportunities ahead, and we look forward to sharing our progress as we continue to execute on our vision of transforming lives with trusted financial services that transcend borders.

This concludes today's conference call. Thank you for participating, and you may now disconnect.