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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Payoneer Global Inc | NASDAQ:PAYO | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
-0.03 | -0.51% | 5.84 | 5.72 | 5.91 | 5.92 | 5.76 | 5.83 | 2,233,238 | 01:00:00 |
Third consecutive year of 30%+ revenue growth since going public in 2021
Significantly expanded profitability in 2023
Payoneer Global Inc. (“Payoneer” or the “Company”) (NASDAQ: PAYO), the financial technology company empowering the world’s small and medium-sized businesses to transact, do business and grow globally, today reported financial results for its fourth quarter and full year ended December 31, 2023.
Fourth Quarter and Full Year 2023 Financial Highlights
($ in mm)4Q 2022
1Q 2023
2Q 2023
3Q 2023
4Q 2023
YoYChange2022
2023
YoYChange Revenue$183.6
$192.0
$206.7
$208.0
$224.3
22%
$627.6
$831.1
32%
Transaction costs as a % of revenue16.6%
14.1%
13.8%
14.6%
16.2%
(40 bps)17.6%
14.7%
(290 bps) Revenue less transaction costs$153.2
$164.9
$178.2
$177.6
$188.0
23%
$517.5
$708.8
37%
Net income (loss)(10.2)
7.9
45.5
12.8
27.0
n.m.(12.0)
93.3
n.m. Adjusted EBITDA10.6
38.8
56.0
58.2
52.2
393%
48.5
205.1
323%
Operational Metrics Active Ideal Customer Profiles (ICPs) ('000s)1488
491
495
502
516
6%
488
516
6%
Volume ($bn)2$16.5
$15.3
$15.3
$16.3
$19.0
16%
$59.7
$66.0
11%
Revenue as a % of volume ("Take Rate") 112 bps 125 bps 135 bps 127 bps 118 bps 6 bps 105 bps 126 bps 21 bps1.
Active ICPs are defined as customers with a Payoneer Account that have on average over $500 a month in volume and were active over the trailing twelve-month period.
2.
For a customer that both receives and later sends payments, we count the volume only once. We have updated our methodology to adjust for previously disclosed limited exceptions where both received and sent payments were counted in volumes, such that we count volume only once for a customer that both receives and later sends payments. The updated methodology has no impact on revenue and had, for all periods presented, less than a 3% impact on volume. The update has been applied to all periods reflected in the table above and we have updated the definition of volume accordingly (please see “Financial Information; Non-GAAP Financial Measures” below).
“We made meaningful progress in 2023 to expand access for small and medium-sized businesses (SMBs) to the digital, global economy. Payoneer is helping SMBs in over 190 countries and territories sell globally across multiple channels and consolidate their accounts receivable (AR) into their Payoneer Accounts. Our customers are also increasingly using Payoneer’s financial stack to optimize their accounts payable (AP). By capturing their cross-border AR and AP, we become an indispensable, trusted partner to their growth,” said John Caplan, Chief Executive Officer. “Our strategy is working, and we drove 6% year-over-year growth in our ideal customer profiles (ICPs) and 36% ARPU expansion. As we continue to execute our strategy and build on our fourth quarter momentum, I am confident we can deliver more value for our customers, employees, and shareholders in 2024 and beyond.”
Full Year 2023 Business Highlights
Fourth Quarter 2023 Business Highlights
2024 Guidance
“Payoneer began 2023 with a focus on profitable growth, and we have delivered. In 2023, we generated 32% revenue growth, over $90 million of net income, and quadrupled adjusted EBITDA to over $200 million,” said Bea Ordonez, Chief Financial Officer. “Our 2024 guidance reflects accelerating business momentum over the course of the year as we focus on acquiring and retaining active ICPs, increasing customer adoption of multiple products and services, and driving our two growth engines: B2B and Merchant Services. We intend to continue innovating, improving our customer experience, and strengthening our infrastructure to deliver long-term profitable growth.”
2024 guidance is as follows:
Revenue
$875 million - $885 million
Transaction costs
~17.5% of revenue
Adjusted EBITDA (1)
$185 million to $195 million
(1) Guidance for fiscal year, where adjusted, is provided on a non-GAAP basis, which Payoneer will continue to identify as it reports its future financial results. The Company cannot reconcile its expected adjusted EBITDA to expected net income under “2024 Guidance” without unreasonable effort because certain items that impact net income and other reconciling metrics are out of the Company's control and/or cannot be reasonably predicted at this time, which unavailable information could have a significant impact on the Company’s GAAP financial results. Please refer to “Financial Information; Non-GAAP Financial Measures” below for a description of the calculation of adjusted EBITDA.
Webcast
Payoneer will host a live webcast of its earnings on a conference call with the investment community beginning at 8:30 a.m. ET today, February 28, 2024. To access the webcast, go to the investor relations section of the Company’s website at https://investor.payoneer.com. A replay will be available on the investor relations website following the call.
About Payoneer
Payoneer is the financial technology company empowering the world’s small and medium-sized businesses to transact, do business, and grow globally. Payoneer was founded in 2005 with the belief that talent is equally distributed, but opportunity is not. It is our mission to enable any entrepreneur and business anywhere to participate and succeed in an increasingly digital global economy. Since our founding, we have built a global financial stack that removes barriers and simplifies cross-border commerce. We make it easier for millions of SMBs, particularly in emerging markets, to connect to the global economy, pay and get paid, manage their funds across multiple currencies, and grow their businesses.
Forward-Looking Statements
This press release includes, and oral statements made from time to time by representatives of Payoneer, may be considered “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements generally relate to future events or Payoneer’s future financial or operating performance. For example, projections of future revenue, transaction cost and adjusted EBITDA are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “expect,” “intend,” “plan,” “will,” “estimate,” “anticipate,” “believe,” “predict,” “potential” or “continue,” or the negatives of these terms or variations of them or similar terminology. Such forward-looking statements are subject to risks, uncertainties, and other factors which could cause actual results to differ materially from those expressed or implied by such forward looking statements. These forward-looking statements are based upon estimates and assumptions that, while considered reasonable by Payoneer and its management, as the case may be, are inherently uncertain. Factors that may cause actual results to differ materially from current expectations include, but are not limited to: (1) changes in applicable laws or regulations; (2) the possibility that Payoneer may be adversely affected by geopolitical events and conflicts, such as the current conflict between Israel and Hamas, and other economic, business and/or competitive factors; (3) Payoneer’s estimates of its financial performance; (4) the outcome of any known and/or unknown legal or regulatory proceedings; and (5) other risks and uncertainties set forth in Payoneer’s Annual Report on Form 10-K for the period ended December 31, 2023 and future reports that Payoneer may file with the SEC from time to time. Nothing in this press release should be regarded as a representation by any person that the forward-looking statements set forth herein will be achieved or that any of the contemplated results of such forward-looking statements will be achieved. You should not place undue reliance on forward-looking statements, which speak only as of the date they are made. Payoneer does not undertake any duty to update these forward-looking statements.
Financial Information; Non-GAAP Financial Measures
Some of the financial information and data contained in this press release, such as adjusted EBITDA, have not been prepared in accordance with United States generally accepted accounting principles (“GAAP”). Payoneer uses these non-GAAP measures to compare Payoneer’s performance to that of prior periods for budgeting and planning purposes. Payoneer believes these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to Payoneer’s results of operations. Payoneer's method of determining these non-GAAP measures may be different from other companies' methods and, therefore, may not be comparable to those used by other companies and Payoneer does not recommend the sole use of these non-GAAP measures to assess its financial performance. Payoneer management does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses and income that are required by GAAP to be recorded in Payoneer’s financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgments by management about which expense and income are excluded or included in determining these non-GAAP financial measures. In order to compensate for these limitations, management presents non-GAAP financial measures in connection with GAAP results. You should review Payoneer’s financial statements, which are included in Payoneer’s Annual Report on Form 10-K for the year ended December 31, 2023 and its subsequent Quarterly Reports on Form 10-Q, and not rely on any single financial measure to evaluate Payoneer’s business.
Non-GAAP measures include the following item:
Adjusted EBITDA: We provide adjusted EBITDA, a non-GAAP financial measure that represents our net income (loss) adjusted to exclude: M&A related expense (income), stock-based compensation expenses, restructuring expenses, share in losses (gain) of associated company, gain from change in fair value of warrants, other financial expense (income), net, taxes on income, and depreciation and amortization.
Other companies may calculate the above measure differently, and therefore Payoneer’s measures may not be directly comparable to similarly titled measures of other companies.
In addition, in this earnings release, we reference volume, which is an operational metric. Volume refers to the total dollar value of transactions successfully completed or enabled by our platform, not including orchestration transactions. For a customer that both receives and later sends payments, we count the volume only once. Note: we have updated our methodology to adjust for previously disclosed limited exceptions where both received and sent payments were counted in volumes, such that we count volume only once for a customer that both receives and later sends payments. The updated methodology has no impact on revenue and had for all periods presented, less than a 3% impact on volume. The update has been applied to all periods reflected in the volume table in this press release and we have updated the definition of volume accordingly.
In this earnings release, we also reference ARPU. ARPU (Average Revenue Per User) is defined as the Revenue from Active Customers divided by the number of Active Customers over the period in which the Revenue was earned. Active Customers for these purposes are defined as Payoneer accountholders with at least 1 financial transaction over the period. Revenue from Active Customers represents revenue attributed to Active Customers based on their use of the Payoneer platform, including interest income earned from their balances, and excluding revenues unrelated to their activities.
TABLE - 1 PAYONEER GLOBAL INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (U.S. dollars in thousands, except share and per share data) (Unaudited) Three months endedDecember 31, Year endedDecember 31,2023
2022
2023
2022
Revenues $224,320
$183,558
$831,103
$627,623
Transaction costs (Exclusive of depreciation and amortization shown separately below and inclusive of $1,781, $1,491, and $220 interest expense and fees associated with related party transaction in 2023, 2022, and 2021 respectively)36,320
30,392
122,291
110,165
Other operating expenses39,686
41,304
160,609
149,199
Research and development expenses34,972
32,902
119,197
115,041
Sales and marketing expenses51,762
52,194
196,654
164,564
General and administrative expenses27,124
29,997
100,929
90,010
Depreciation and amortization8,750
5,333
27,814
20,858
Total operating expenses198,614
192,122
727,494
649,837
Operating income (loss)25,706
(8,564)
103,609
(22,214)
Financial income (expense): Gain from change in fair value of Warrants11,824
5,031
17,359
33,963
Other financial income (expense), net3,763
1,005
11,568
(10,131)
Financial income, net15,587
6,036
28,927
23,832
Income (loss) before taxes on income and share in losses of associated company41,293
(2,528)
132,536
1,618
Taxes on income14,272
7,610
39,203
13,586
Share in losses of associated company—
13
—
2
Net income (loss) $27,021
$(10,151)
$93,333
$(11,970)
Other comprehensive income (loss), net of tax Foreign currency translation adjustments—
2,087
—
(2,429)
Other comprehensive income (loss), net of tax—
2,087
—
(2,429)
Comprehensive income (loss) $27,021
$(8,064)
$93,333
$(14,399)
Per Share Data Net income (loss) per share attributable to common stockholders — Basic earnings (loss) per share $0.08
$(0.03)
$0.26
$(0.03)
— Diluted earnings (loss) per share $0.07
$(0.03)
$0.24
$(0.03)
Weighted average common shares outstanding — Basic354,697,812
352,756,697
361,678,893
348,044,831
Weighted average common shares outstanding — Diluted379,881,231
352,756,697
392,665,718
348,044,831
Disaggregation of revenue
The following table presents revenue recognized from contracts with customers as well as revenue from other sources:
Three months endedDecember 31, Year endedDecember 31,2023
2022
2023
2022
Revenue recognized at a point in time $156,114
$137,813
$573,902
$533,213
Revenue recognized over time660
7,723
16,925
30,354
Revenue from contracts with customers $156,774
$145,536
$590,827
$563,567
Interest income on customer balances $64,867
$35,894
$230,634
$55,292
Capital advance income2,679
2,128
9,642
8,764
Revenue from other sources $67,546
$38,022
$240,276
$64,056
Total revenues $224,320
$183,558
$831,103
$627,623
The following table presents the Company’s revenue disaggregated by primary regional market, with revenues being attributed to the country (in the region) in which the billing address of the transacting customer is located, with the exception of global bank transfer revenues, where revenues are disaggregated based on the billing address of the transaction funds source.
Three months endedDecember 31, Year endedDecember 31,2023
2022
2023
2022
Primary regional markets Greater China(1) $80,244
$55,675
$287,944
$195,663
Europe(2)44,170
38,334
166,868
130,850
Asia-Pacific(2)32,424
24,060
114,335
84,817
North America(3)23,499
29,408
97,434
92,045
South Asia, Middle East and North Africa(2)23,400
19,167
87,237
69,239
Latin America(2)20,583
16,914
77,285
55,009
Total revenues $224,320
$183,558
$831,103
$627,623
1.
Greater China is inclusive of mainland China, Hong Kong, Macao and Taiwan
2.
No single country included in any of these regions generated more than 10% of total revenue
3.
The United States is the Company’s country of domicile. Of North America revenues, the US represents $22,452 and $28,453 for the three months ended December 31, 2023 and 2022, and $93,371 and $87,438 during the years ended December 31, 2023 and 2022.
TABLE - 2 PAYONEER GLOBAL INC. RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA (UNAUDITED) (U.S. dollars in thousands) Three months ended Year ended December 31, December 31,2023
2022
2023
2022
Net income (loss) $27,021
$(10,151)
$93,333
$(11,970)
Depreciation and amortization8,750
5,333
27,814
20,858
Taxes on income14,272
7,610
39,203
13,586
Other financial (income) expense, net(3,763)
(1,005)
(11,568)
10,131
EBITDA46,280
1,787
148,782
32,605
Stock based compensation expenses(1)17,338
13,827
65,767
52,150
Share in loss of associated company—
13
—
2
M&A related expense (income)(2)451
—
3,468
(2,323)
Gain from change in fair value of Warrants(3)(11,824)
(5,031)
(17,359)
(33,963)
Restructuring charges(4)—
—
4,488
—
Adjusted EBITDA $52,245
$10,596
$205,146
$48,471
Three months ended, Dec. 31, 2022 Mar. 31, 2023 June 30, 2023 Sept. 30, 2023 Dec. 31, 2023 Net income (loss) $(10,151)
$7,938
$45,549
$12,825
$27,021
Depreciation and amortization5,333
6,039
5,909
7,116
8,750
Taxes on income7,610
9,172
5,747
10,012
14,272
Other financial income, net(1,005)
(2,350)
(4,318)
(1,137)
(3,763)
EBITDA1,787
20,799
52,887
28,816
46,280
Stock based compensation expenses(1)13,827
16,927
16,173
15,330
17,338
Share in losses of associated company13
—
—
—
—
M&A related expense(2)—
774
498
1,745
451
Loss (gain) from change in fair value of Warrants(3)(5,031)
252
(13,586)
7,799
(11,824)
Restructuring charges(4)—
—
—
4,488
—
Adjusted EBITDA $10,596
$38,752
$55,972
$58,178
$52,245
1.Represents non-cash charges associated with stock-based compensation expense, which has been, and will continue to be for the foreseeable future, a significant recurring expense in our business and an important part of our compensation strategy.
2.Amounts for 2023 relate to M&A-related third-party fees, including related legal, consulting and other expenditures. Amounts for the year ended December 31, 2022 relate to a non-recurring fair value adjustment of a liability related to our 2020 acquisition of optile.
3.Changes in the estimated fair value of the warrants are recognized as gain or loss on the statements of comprehensive income (loss). The impact is removed from EBITDA as it represents market conditions that are not in our control.
4.We initiated a plan to reduce our workforce during the year ended December 31, 2023, and had non-recurring costs related to severance and other employee termination benefits.
TABLE - 3 PAYONEER GLOBAL INC. EARNINGS (LOSS) PER SHARE (U.S. dollars in thousands, except share and per share data) (Unaudited) Three months ended December 31, Year ended December 31,2023
2022
2023
2022
Numerator: Net income (loss) $27,021
$(10,151)
$93,333
$(11,970)
Denominator: Weighted average common shares outstanding — Basic354,697,812
352,756,697
361,678,893
348,044,831
Add: Dilutive impact of RSUs, ESPP and options to purchase common stock24,453,273
—
30,256,559
—
Dilutive impact of private Warrants730,146
—
730,266
—
Weighted average common shares — diluted379,881,231
352,756,697
392,665,718
348,044,831
Net income (loss) per share attributable to common stockholders — Basic earnings (loss) per share $0.08
$(0.03)
$0.26
$(0.03)
Diluted earnings (loss) per share $0.07
$(0.03)
$0.24
$(0.03)
TABLE - 4 PAYONEER GLOBAL INC. CONSOLIDATED BALANCE SHEETS (U.S. dollars in thousands, except share and per share data) December 31,2023
2022
Assets: Current assets: Cash and cash equivalents $617,022
$543,299
Restricted cash7,030
2,882
Customer funds6,390,526
5,838,612
Accounts receivable (net of allowance of $385 in 2023 and $246 in 2022)7,980
12,878
Capital advance receivables (net of allowance of $5,059 in 2023 and $5,311 in 2022)45,493
37,155
Other current assets40,672
36,278
Total current assets7,108,723
6,471,104
Non-current assets: Property, equipment and software, net15,499
14,392
Goodwill19,889
19,889
Intangible assets, net76,266
45,444
Restricted cash5,780
4,848
Deferred taxes15,291
4,169
Investment in associated company—
6,429
Severance pay fund840
1,095
Operating lease right-of-use assets24,854
15,260
Other assets15,977
12,021
Total assets $7,283,119
$6,594,651
Liabilities and shareholders’ equity: Current liabilities: Trade payables $33,941
$41,566
Outstanding operating balances6,390,526
5,838,612
Other payables117,508
97,334
Total current liabilities6,541,975
5,977,512
Non-current liabilities: Long-term debt from related party18,411
16,138
Warrant liability8,555
25,914
Other long-term liabilities49,905
29,831
Total liabilities6,618,846
6,049,395
Commitments and contingencies Shareholders’ equity: Preferred stock, $0.01 par value, 380,000,000 shares authorized; no shares were issued and outstanding at December 31, 2023 and December 31, 2022.—
—
Common stock, $0.01 par value, 3,800,000,000 and 3,800,000,000 shares authorized; 368,655,185 and 352,842,025 shares issued and 357,590,493 and 352,842,025 shares outstanding at December 31, 2023 and December 31, 2022, respectively.3,687
3,528
Treasury stock at cost, 11,064,692 and 0 shares at December 31, 2023 and December 31, 2022.(56,936)
—
Additional paid-in capital732,894
650,433
Accumulated other comprehensive loss(176)
(176)
Accumulated deficit(15,196)
(108,529)
Total shareholders’ equity664,273
545,256
Total liabilities and shareholders’ equity $7,283,119
$6,594,651
TABLE - 5 PAYONEER GLOBAL INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (U.S. dollars in thousands) Year ended December 312023
2022
Cash Flows from Operating Activities Net income (loss) $93,333
$(11,970)
Adjustment to reconcile net loss to net cash provided by operating activities: Depreciation and amortization27,814
20,858
Deferred taxes(11,122)
731
Stock-based compensation expenses65,767
52,149
Share in losses of associated company—
2
Gain from change in fair value of Warrants(17,359)
(33,963)
Transaction costs allocated to Warrants—
—
Foreign currency re-measurement (income) loss(4,359)
2,752
Changes in operating assets and liabilities, net of the effects of business combinations: Other current assets(4,310)
(11,421)
Trade payables(8,326)
24,284
Deferred revenue1,348
224
Accounts receivable, net4,898
964
Capital advance extended to customers(299,139)
(223,819)
Capital advance collected from customers290,801
237,834
Other payables13,619
16,608
Other long-term liabilities232
(3,480)
Operating lease right-of-use assets10,248
10,686
Other assets(3,956)
1,521
Net cash provided by operating activities $159,489
$83,960
Cash Flows from Investing Activities Purchase of property, equipment and software(8,459)
(10,504)
Capitalization of internal use software(39,333)
(18,329)
Related party asset acquisition(3,600)
—
Severance pay fund distributions, net255
628
Customer funds in transit, net930
33,939
Net cash inflow from acquisition of remaining interest in joint venture5,953
—
Net cash provided by (used in) investing activities $(44,254)
$5,734
Cash Flows from Financing Activities Proceeds from issuance of common stock in connection with stock based compensation plan, net of taxes paid related to settlement of equity awards13,203
21,346
Outstanding operating balances, net551,914
1,437,358
Borrowings under related party facility26,855
29,363
Repayments under related party facility(24,582)
(26,755)
Common stock repurchased(55,436)
—
Net cash provided by financing activities $511,954
$1,461,312
Effect of exchange rate changes on cash and cash equivalents $4,458
$(2,719)
Net change in cash, cash equivalents, restricted cash and customer funds631,647
1,548,287
Cash, cash equivalents, restricted cash and customer funds at beginning of year6,386,720
4,838,433
Cash, cash equivalents, restricted cash and customer funds at end of year $7,018,367
$6,386,720
Supplemental disclosure of cash flow information: Cash paid for taxes, net of refunds $40,910
$9,425
Cash interest paid $1,767
$1,466
Supplemental information of investing and financing activities not involving cash flows: Property, equipment, and software acquired but not paid $810
$109
Internal use software capitalized but not paid $10,159
$4,392
Right-of-use assets obtained in exchange for new operating lease liabilities $19,842
$13,003
Common stock repurchased but not paid $1,500
$—
View source version on businesswire.com: https://www.businesswire.com/news/home/20240228385123/en/
Investors: Michelle Wang investor@payoneer.com Media: Alison Dahlman PR@payoneer.com
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