Wise (LON:WISE) reported first-half net revenue growth of 23% to nearly $1.5 billion, as more customers used its services to move money across borders and spend with its cards. The company said it expects full-year revenue growth to land in the upper half of its medium-term target range.
Income before tax was $335 million in the first half of fiscal 2027, giving the payments company a 23% margin, Chief Financial Officer Emmanuel Thomassin said on the earnings call. Wise also expects full-year margins around the high end of its 2025 range.
Thomassin said the outlook assumes no material changes in central bank interest rates. He added that the company had not speculated on further rate moves in the next six months.
Cross-border and card activity grow
Wise served 16 million customers in the half, who sent or converted $141 billion internationally, up 24% from a year earlier, according to Thomassin. Cross-border volume grew 30% in the U.S. and 28% in Asia-Pacific.
Business cross-border volume increased 35% and accounted for 31% of the company’s total cross-border volume. Wise Platform, which provides services to banks and other partners, grew nearly 50% and represented about 6% of cross-border volume.
Cross-border activity generated $705 million in revenue, up 19%. Revenue grew more slowly than volume as the average take rate fell to 50 basis points from 52 basis points a year earlier, reflecting pricing investments, Thomassin said.
Customers spent more than $27 billion using Wise cards, an increase of 33%. Card revenue rose 43% to $252 million, helped by faster growth in regions with higher interchange rates and increased use by businesses, which also carry higher rates. Other revenue, including from domestic transactions and asset products, rose 27% to $145 million.
At the end of September, customers held $32 billion in Wise Accounts, up 22% year over year. Interest income rose 16% to $464 million, while Wise paid customers $113 million in interest during the half. Thomassin said the average yield fell to 2.9% from 3.2% a year earlier because of shifts in central bank rates.
Expansion and investment
CEO and co-founder Kristo Käärmann said Wise had begun operating in Chile and Thailand and had joined Malaysia’s real-time DuitNow payment system. In the latest quarter, 78% of transactions arrived in recipients’ bank accounts in under 20 seconds, he said.
Wise has also started rolling out foreign exchange forwards in the U.K., allowing business customers to lock in exchange rates up to six months ahead. Käärmann said the feature addresses the needs of increasingly large business customers seeking more certainty over their cash flows.
The company increased direct investments by 44% year over year to $911 million in the half. Thomassin said Wise expects investment growth, excluding one-off items, to slow in the second half, although it would remain flexible if opportunities with high returns arise.
Transaction expenses and transaction and credit losses totaled $239 million, down 10% year over year, or 16% of net revenue compared with 23% a year earlier. Thomassin said direct connections to payment systems and improved terms with partners as volumes grow had helped reduce costs. The comparison also included non-comparable effects related to the accounting treatment of available-for-sale debt securities, he said.
Platform partnerships and settlement
Käärmann said two large North American banks went live on Wise Platform during the period, bringing the number of live partners from the region’s 20 largest banks to three. He identified Morgan Stanley as one of the new banks and said growth was also coming from existing partners using Wise for more of their cross-border flows.
Thomassin also said Wise Europe had reached an agreement with Brussels prosecutors to fully resolve and settle a matter concerning queries about its business, with no admission of wrongdoing. He said the settlement terms would not be disclosed and that the amount was not material to the company’s results.
Wise had completed nearly half of the share purchase program of more than $500 million that it announced in June, Thomassin said.
About Wise (LON:WISE)
Wise plc provides cross-border and domestic financial services for personal and business customers in the United Kingdom, rest of Europe, the Asia-Pacific, North America, and internationally. Its product portfolio includes international money transfer, wise account, international debit card, amount transfer, receive money, wise platform, business debit card, and mass payment services. The company was formerly known as 456 Newco plc and changed its name to Wise plc in June 2021. Wise plc was founded in 2010 and is based in London, the United Kingdom.
