Wise plans $500 million buyback as profit falls despite revenue gain
Wise Group PLC late on Thursday unveiled plans for a more than $500 million buyback programme, as it posted a decline in earnings but saw its margin edge past medium-term guidance.
The London-based money transfer services reported $660.4 million in pretax profit for the financial year ended March 31, down 8.0% from $717.5 million a year earlier.
The company noted this reflected an income before tax margin of 26%, coming in slightly ahead of its 20% to 25% guided range for the medium term. For financial 2025, the company reported a pretax profit margin of 34%, while on an underlying basis, it was 21%.
Net revenue advanced 19% to $2.50 billion from $2.10 billion, as transaction revenue grew 22% to $1.89 billion from $1.55 billion.
Interest income on customer balances improved 6.3% to $806.1 million from $758.3 million, while interest expense on customer liabilities fell 4.3% to $196.9 million from $205.7 million.
Wise reported a 21% uplift in active customers to 18.9 million from 15.6 million, with card spend rising 37% to $43.6 billion from $31.9 billion.
The weaker earnings amid the improved top line were due to higher costs, as total operating expenses grew 39% to $1.91 billion from $1.37 billion.
Wise on Thursday also set out plans for an over $500 million share buyback programme. It doesn’t pay a dividend.
Looking ahead to the current financial year, Wise is targeting net revenue growth around the middle of its 15% to 20% medium-term target range on a constant currency basis. The company said this assumes no material changes in interest paid to customers as well as no material change in central bank rates.
Wise is also targeting an income before tax margin at the top of the 20% to 25% range.
Shares in the company were up 6.5% at 883.87 pence in early trading in London on Friday, having risen 4.6% to $11.57 during after-hours trading in New York. It released its results after the New York market close on Thursday.
Wise made its debut on the Nasdaq last month, while maintaining a secondary listing on the London Stock Exchange’s Main Market.
Earlier in June, the company’s shares came under pressure following regulatory scrutiny from Brussels, with Wise noting it was ‘working with the Brussels prosecutor to respond to queries about our business’.
‘Over the last year we added new licenses, direct connections, launched new product features and added Wise Platform partners as we progressed on our mission,’ Co-Founder & Chief Executive Officer Kristo Kaarmann said on Thursday. ‘We went live with two new direct connections in Brazil and Japan, gained new license approvals in South Africa, UAE and Thailand, rolled out Assets to Brazil and added partners including Raiffeisen Bank and UniCredit.’
The CEO added: ‘With $43 trillion moved across borders by people and businesses every year, we remain focused on the opportunity ahead and building ’the’ network for the world’s money.’
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