Payoneer Global Inc.

Good morning and thank you for standing by. Welcome to the Payoneer's first quarter 2025 earnings conference call. At this time, all lines have been placed on mute to prevent any background noise. Following the speaker's remarks, there will be a question and answers that will open your line for questions. As a reminder, this conference call is being recorded. I would now like to turn the call over to Michelle Wang, Payoneer's VP of Investor Relations.

Thank you, Operator. With me on today's call are Payoneer's Chief Executive Officer, John Kaplan, and Payoneer's Chief Financial Officer, Bea Ordonez. Before we begin, I'd like to remind you that today's call may contain forward-looking statements, which are subject to risks and uncertainties. For more information, please refer to our filings with SEC, which are available in the Investor Relations section of Payoneer.com. Actual results may differ materially from any forward-looking statements we make today. These forward-looking statements speak only as of today, and the company does not assume any obligation or intent to update them except as required by law. In addition, today's call may include non-GAAP measures. These measures should be considered in addition to and not instead of GAAP financial measures. Reconciliation to the nearest GAAP measure can be found in today's earnings press release, which is available on our website. Additionally, please note that we've posted an earnings presentation supplement alongside our earnings press release on investor.payoneer.com. All comparisons made on today's call are on a year-over-year basis, unless otherwise noted. With that, I'd like to turn the call over to John to begin.

Good morning, everyone, and thank you for joining us. Payoneer has a long-term opportunity to become the essential partner for cross-border S&Bs to help connect them to the global economy. Today, I'll share how we're leveraging our core assets to build momentum and navigate the rapidly changing trade landscape. We will then walk through our first quarter financial results and provide context on our 2025 outlook. We serve nearly 2 million entrepreneurs in SMBs, including over a half a million who fit our ideal customer profile. Our customers are engaged in cross-border trade, operating in more than 190 countries and territories, and selling to a wide range of end markets. They provide marketing, IT, customer support, and other services to a diverse set of global industries and countries. They also sell a broad set of goods wholesale through marketplaces and direct to everyday consumers around the world. Through their multi-currency Payoneer account, our customers manage their cross-border accounts receivable and accounts payable, including using our card and workforce management products. We call this the Payoneer Financial Stack. Around that stack, we have built a significant moat over the past 20 years. Licenses across key markets from China to Europe to the U.S. We have expertise in local markets and robust infrastructure aligned with local regulatory needs. Enduring partnerships with leading freelance, travel, content, and e-commerce goods marketplaces. a robust and resilient infrastructure of global bank and PSP relationships that enable connectivity across 7,000 payment corridors, employees on the ground in over 35 countries, and a scalable support model that serves our nearly 2 million customers. 2024 was a record year for Payoneer, and we've carried that strength into our Q1 2025 results. Revenue grew 16% year over year, excluding interest income, ahead of our stated medium-term targets. Our B2B business continues to grow significantly. B2B revenue increased 37%, driven by growth in APAC, EMEA, and Latin America. We see strong demand and product market fit in these service-focused markets. Adjusted EBITDA was $65 million, with a 27% margin. Excluding interest income, Q1 was our highest adjusted EBITDA quarter in nearly three years and was the fourth consecutive quarter of profitability net of interest. We continue to focus our efforts on quality customers. We've been actively shifting our customer portfolio and targeting the highest value segments by industry, region, size, and product need. At the same time, We are cross-selling more of our products and expanding our relationships with our customers. Our results reflect our strategy. We're growing volume and revenue with our 10K plus ICPs. 10K plus ICP volume was up 8% in Q1, while revenue was up 18%. Our ARPU growth, excluding interest income, accelerated for the seventh straight quarter, reaching 22% growth year over year. This is the direct result of our customer mix shift and successful cross-sell of more products and services. Our results reflect the value we're delivering to our customers as they continue to scale and grow their cross-border businesses. Global trade is being reshaped. For businesses around the world, this is a challenging and clarifying moment. like the first few months of COVID were five years ago. We spent the past few weeks listening to our customers. Our conversations give us more conviction about what we're building and how we're building it here at Payoneer. One customer said to me, the changing macro environment fuels innovation and reinvention, and I'm glad I have Payoneer supporting me as I expand my business to more countries. Our customers are nimble and rapidly adapting to change. Last month at Payoneer's 20th anniversary, we brought together 20 customers from around the world. Here's what they told us. They're increasingly diversifying both where they sell and how they source materials and talent. Many are more focused on Europe, Southeast Asia, Latin America, and Australia as they pivot the Payoneer account becomes even more useful. They're building distributed teams around the world in order to benefit from global talent capabilities. As they do, they're turning to Payoneer's account payable capabilities, including our workforce management product. Payoneer is built to support them. We see this current disruption as a meaningful long-term opportunity Because Payoneer isn't just built for the old model of trade, we're positioned for the new one. And as value chains diversify, we are positioned to benefit. First, we combine local presence with global scale. Our teams are on the ground in the world's most entrepreneurial regions. In Q1, our APAC and Latin America customer regions each grew revenue over 20%. Together, they represent about a third of our firm's total revenue, with an average take rate of approximately 2% to 3%. These are regions where we expect continued tailwinds as trade routes shift and businesses expand their global footprints. We have over a half a million ICPs that are roughly evenly distributed across our five regions. Approximately 40% of our revenue comes from helping customers sell to non-U.S. markets. We are well positioned to grow with our customers as they diversify the regions they sell to. Second, our global regulatory footprint. We have recently closed our acquisition of a licensed China-based payment provider, becoming only the third foreign player licensed in China. China is an important market for us. About a third of our revenue comes from China-based exporters, while only 20% of our overall annual revenue is tied directly to the U.S. to China trade corridor. China exports to over 120 countries, and as our Chinese customers drive their goods distribution to more markets around the world, including Europe, Latin America, Southeast Asia, we will help them diversify, and we will grow with them. We also applied for a cross-border payment aggregator license in India, the fastest growing top five economy in the world. They are a country that stands to benefit from this new trade landscape. We are also actively pursuing licenses in Canada, Israel, and beyond. We're investing in the future of trade, global, regulated, diverse, and powered by entrepreneurs and cross-border S&Ps. Third, trade is increasingly services-based. Our customers include service providers such as BPOs, software developers, marketing firms, and remote workers on marketplaces. Outsourcing and remote work will continue, especially in uncertain times, as companies look to grow and to optimize their own P&Ls. We are well positioned, including our new workforce management solution, to help customers capitalizing on this trend. Payoneer has weathered uncertainty before, and we've come out stronger. This is another moment to turn change and disruption into opportunity. We're staying close to our customers, we're staying disciplined in our execution, and we're moving fast to seize new opportunities in emerging markets. By doing just that, we believe we can create long-term value for shareholders. and we continue to play a vital role in the global economy. With that, I'll turn it over to Bea to take you through the numbers and our outlook for the year.