Payoneer Global Q2 2025 Earnings Report

Payoneer Global EPS Results

• Actual EPS: $0.05
• Consensus EPS: $0.06
• Beat/Miss: Missed by -$0.01
• One Year Ago EPS: $0.09

Payoneer Global Revenue Results

• Actual Revenue: $260.61 million
• Expected Revenue: $253.17 million
• Beat/Miss: Beat by +$7.45 million
• YoY Revenue Growth: +8.80%

Payoneer Global Announcement Details

• Quarter: Q2 2025
• Date: 8/6/2025
• Time: Before Market Opens
• Conference Call Date: Wednesday, August 6, 2025
• Conference Call Time: 8:30AM ET

Payoneer Global (NASDAQ:PAYO) operates as a financial technology company. It operates a payment infrastructure platform that provides customers with a one-stop, global, multi-currency account to serve their accounts receivable and accounts payable needs. The company delivers a suite of services that includes cross-border payments, physical and virtual MasterCard cards, working capital, risk management, and other services. It also offers various payment options with minimal integration required, full back-office functions, and customer support offered. The company's platform delivers bank-grade security, stability, and redundancy. It serves customers, such as small and medium-sized businesses in approximately 190 countries and territories worldwide. Payoneer Global Inc. was founded in 2005 and is headquartered in New York, New York.

Payoneer Global Q2 2025 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Record quarterly revenue ex-interest income rose 16% year over year, ARPU expanded 21% ex-interest, and adjusted EBITDA reached $66 million at a 25% margin.
• Positive Sentiment: Reinstated full-year 2025 guidance with total revenue expected between $1.04 billion and $1.06 billion and adjusted EBITDA ex-interest projected to more than triple versus 2024.
• Positive Sentiment: B2B franchise delivered 37% revenue growth, with mid-20% volume gains in APAC, LatAm, and EMEA, and launched a strategic partnership with Stripe to enhance global checkout.
• Neutral Sentiment: Exploring stablecoin integration to enable customers to send, receive, and off-ramp digital currencies, leveraging regulatory clarity from the Genius Act and Payoneer’s global banking network.
• Positive Sentiment: Share repurchases nearly doubled to $33 million in Q2, and a refreshed $300 million buyback authorization was announced, underscoring confidence in the company’s value.

Presentation

[Operator]

Good morning. Thank you for standing by. Welcome to Payoneer's Second Quarter twenty twenty five Earnings Conference Call. At this time, all lines have been placed on mute to prevent any background noise. Following the speakers' remarks, we will open the lines for your questions.

[Operator]

As a reminder, this conference call is being recorded. I would now like to turn the call over to Michelle Wang, Payoneer's Vice President of Investor Relations. You may begin.

[Michelle Wang, VP - IR at Payoneer Global]

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 the 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.

[Michelle Wang, VP - IR at Payoneer Global]

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 materials, which are available on our website. Additionally, please note we have posted an earnings presentation supplement alongside our earnings press release on investor.payoneer.com.

[Michelle Wang, VP - IR at Payoneer Global]

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.

[John Caplan, CEO & Director at Payoneer Global]

Good morning everyone. Thank you for joining us. Today I'll walk you through our strong second quarter results. We are executing against the significant opportunity in front of us and building the financial stack for cross border commerce. After that, Bea will take you through the financials and our reinstated full year 2025 guidance.

[John Caplan, CEO & Director at Payoneer Global]

Let's start with the big picture. Payoneer is the global payment solution for entrepreneurs and SMBs who power international commerce. These are manufacturers, exporters, agencies, creators and service providers from every corner of the world. They need to invoice and collect payments from customers globally, manage multiple currencies, pay suppliers and employees and access capital, all while navigating local regulations and legacy banking rails. That's where Payoneer comes in.

[John Caplan, CEO & Director at Payoneer Global]

We are their trusted partner delivering innovation at the intersection of global trade and digital finance. Q2 was another strong quarter for Payoneer. Our strategy is working. We're growing and unlocking meaningful operating leverage. In Q2 we delivered record quarterly revenue ex interest income, up 16% year over year ahead of our medium term target.

[John Caplan, CEO & Director at Payoneer Global]

We delivered 13,000 net new ICPs, up 2% year over year, led by tier one markets, which account for over 60% of our revenue. We delivered ARPU expansion of 21% ex interest income, our fourth consecutive quarter above 20, a sign of strong product adoption, smart pricing and a deliberate move upmarket. We delivered $66,000,000 of adjusted EBITDA, a 25% margin. We delivered over $15,000,000 of adjusted EBITDA ex interest income for the first six months of 2025, greater than what we delivered for the full year of 2024. And our latest guidance at the midpoint implies we expect to more than triple our adjusted EBITDA ex interest in 2025.

[John Caplan, CEO & Director at Payoneer Global]

We're strengthening the fundamentals of our business, improving earnings quality and building a platform designed for durable compounding growth. Global commerce is resilient and it continues to grow and evolve. Our customers are adapting to shifting trade flows and they're choosing Payoneer to help them grow. In China, we see long term momentum and growth in cross border commerce. And we have built a highly differentiated business over two decades serving this market.

[John Caplan, CEO & Director at Payoneer Global]

Our ecom customers are focused on both continuing to serve The U. S. While increasing their investment in new markets. In Q2, approximately a third of our China revenue came from sellers selling to non U. S.

[John Caplan, CEO & Director at Payoneer Global]

Markets. We're helping customers expand globally through our green channel product, supporting their ad spend with our virtual card and providing access to trusted tax and compliance partners. We don't just move money. We help our customers scale. B2B remains one of the fastest growing and most exciting parts of our business.

[John Caplan, CEO & Director at Payoneer Global]

We grew B2B revenue 37% in Q2, led by our largest customer segments. We continue to shift towards larger multi entity customers who have more complex needs. In APAC, LatAm and EMEA, we delivered mid 20% volume growth and continued take rate expansion. We have strong product market fit in these service oriented markets and our customers are rewarding us with their loyalty. At the same time, our China B2B business grew mid single digits in Q2.

[John Caplan, CEO & Director at Payoneer Global]

We continue our methodical approach to unlocking the multi trillion dollar China B2B opportunity. We are strengthening our financial stack to better serve the needs of our customers and drive our retention and ARPU. We've expanded our FX capabilities, launched smarter invoicing and deepened our ERP and third party integrations. We're delivering more automation, removing friction and increasing product engagement and adoption. In Q2, we launched a strategic partnership with Stripe to expand our global checkout footprint and enhance the product's capabilities.

[John Caplan, CEO & Director at Payoneer Global]

We are combining their best in class technology with our local market reach, expertise and customer relationships. This partnership improves our operating efficiency and lets us stay focused on our customer to provide them with an integrated financial stack. I'd like to share an example of a customer that is leveraging Payoneer as their global payment infrastructure to streamline their operations. Brand five zero one is a Korean beauty company with entities across Asia and The U. S.

[John Caplan, CEO & Director at Payoneer Global]

They're using Payoneer to consolidate their payments from major marketplaces, wholesale B2B sales and via their own website for direct to consumer sales through Payoneer checkout. They also use our cards for operational expenses such as advertising and subscription services. By choosing Payoneer they're able to eliminate inefficiencies in their operations and are thriving in a competitive, fast growing industry. That's the kind of customer journey we're enabling every day. We're excited about the momentum we're seeing in stablecoin and blockchain enabled payment technology innovation and adoption.

[John Caplan, CEO & Director at Payoneer Global]

We believe that increased regulatory clarity, including as the result of the enactment of the Genius Act, will unlock opportunity for Payoneer and provide a framework to drive stablecoin adoption, including by global businesses. Payoneer has unique assets that can help position us as a critical part of the infrastructure for this rapidly developing technology. We have distribution, deep customer relationships and connectivity to last mile bank infrastructure around the globe.

[John Caplan, CEO & Director at Payoneer Global]

We enable money moving across 7,000 trade corridors and allow our global customers to transact and hold multiple currencies within a single ecosystem. In pursuit of this opportunity, we're actively exploring enablement of stablecoin functionality for our customers. For example, we're exploring allowing our customers who already rely on us for business grade accounts to send and receive Stablecoin along with our full suite of AP and AR products. We're looking at using our world class last mile infrastructure to help businesses off ramp Stablecoin globally into the local currency that they need for their operations. We are also investing in scale and talent to drive and accelerate our innovation, serve our customers better and drive greater efficiency.

[John Caplan, CEO & Director at Payoneer Global]

We recently announced that we are opening a new technology hub in Gurgaon, India, one of the world's fastest growing economies and home to deep engineering expertise. We're backing our belief and our momentum with action. In Q2, we nearly doubled our share repurchases versus Q1. Today we're announcing a refreshed $300,000,000 buyback authorization. This reflects our conviction in the value of our business and the strength of our financial performance.

[John Caplan, CEO & Director at Payoneer Global]

We're focused. We're executing. And we're building a more valuable platform for our customers and delivering durable growth and compounding returns for our shareholders. Let me end with this. The future of commerce is cross border and it's global.

[John Caplan, CEO & Director at Payoneer Global]

Entrepreneurs in every part of the world are building great companies. But they still face legacy financial systems when they try to trade internationally. That's the problem Payoneer is solving. And it's a massive opportunity. I'll now hand it over to Bea to walk through the results and our reinstated guidance for 2025.

[Bea Ordonez, CFO at Payoneer Global]

Thank you, John, and thank you to everyone for joining us. Payoneer delivered a strong second quarter, executing with discipline and advancing our profitable growth strategy. In a complex global trade environment, we continue to generate revenue and adjusted EBITDA in line with our medium term targets and are reinstating our full year 2025 guidance. We remain confident in our ability to drive profitable growth and deliver long term value for our customers, employees and shareholders. Now turning to our second quarter results.

[Bea Ordonez, CFO at Payoneer Global]

We delivered revenues of $261,000,000 up 9% year over year. Revenue excluding interest income reached $2.00 $2,000,000 a quarterly record and was up 16 year over year, in line with our first quarter results. Our strong growth was driven by our B2B franchise, increasing adoption of our high value products and services such as checkout and card products and the ongoing implementation of our pricing and offering strategy. Total volume was up 11 year over year. SMB volume grew 9% year over year with volume from marketplaces up 6%, volume from B2B SMBs up 19% and checkout volumes up 83%.

[Bea Ordonez, CFO at Payoneer Global]

During the quarter, we saw modest softening in volumes from large e com marketplaces, likely in response to the global macro and tariff environment. Enterprise payouts volume increased 15% year over year, primarily due to strong demand in key travel routes we serve. Our Q2 take rate of 126 basis points decreased two basis points on a year over year basis, driven by lower interest income. We continued to drive significant expansion in our customer take rate, which increased nine basis points over the prior year period and one basis point sequentially. This reflects the ongoing impact of our pricing strategy, continued growth in our higher yielding B2B and checkout franchises and ongoing adoption of our card, strong growth in our higher take rate regions and the impact of our workforce management acquisition.

[Bea Ordonez, CFO at Payoneer Global]

Customer funds held by Payoneer increased 17% year over year to $7,000,000,000 partially offsetting the impact on our interest income revenue of lower rates. We generated interest income of $58,000,000 in the quarter. Growth in customer funds was above our expectations and in excess of our volume growth, with customer usage behavior moderating in certain key markets, likely in response to the uncertain macro environment. This demonstrates the trust our customers have in our platform and the value they place on the utility we provide. As of June 30, we had reduced our sensitivity to fluctuations in short term interest rates in relation to approximately $3,700,000,000 or roughly 53% of customer funds.

[Bea Ordonez, CFO at Payoneer Global]

This consists of approximately 1,800,000,000 of assets underlying customer funds that are invested in a portfolio of U. S. Treasury securities and term based deposits as well as interest rate derivatives on approximately $1,900,000,000 of funds underlying customer balances providing a floor against interest rate declines below 3%. We will continue to actively manage our hedging programs while always prioritizing liquidity and security. Total operating expenses of $231,000,000 increased 19%, primarily driven by increases in labor related expenses, higher transaction costs, consultancy fees, as well as the investments to scale up card product and the effect of recent acquisitions, including our EasyLink acquisition in China and our workforce management acquisition.

[Bea Ordonez, CFO at Payoneer Global]

Transaction costs of $41,000,000 increased 10%, broadly in line with volume growth. Transaction costs represented 15.6% of revenue, an increase of approximately 20 basis points from the prior year period, primarily due to lower interest income. Excluding interest income, transaction costs represented 20.1% of revenue, a decrease of around 120 basis points versus the prior year period, despite mix shift towards higher take rate, higher transaction cost products and driven by improvements in our chargebacks and losses and lower costs related to our capital advance offering. Sales and marketing expense was up $7,000,000 or 13% year over year, driven primarily by higher labor related costs, including from our workforce management acquisition and by card related incentives in support of Chinese and other good sellers. Other operating expenses were up $1,500,000 or 4%, primarily due to higher IT and communication costs.

[Bea Ordonez, CFO at Payoneer Global]

R and D expense increased $10,000,000 or 36%, mainly due to higher labor related costs, including in relation to our workforce management and EZ Link acquisitions. G and A expense increased $11,000,000 or 42%, primarily due to higher legal and consulting fees, including in relation to our India license application, as well as higher labor related costs. Adjusted EBITDA was $66,000,000 representing a 25% adjusted EBITDA margin in the quarter despite the $7,000,000 headwind from interest income. This is the fifth consecutive quarter of positive adjusted EBITDA excluding interest income. Net income was $19,000,000 compared to $32,000,000 in the second quarter of last year.

[Bea Ordonez, CFO at Payoneer Global]

Basic and diluted earnings per share were both $05 down from $09 in the prior year period. We ended the quarter with cash and cash equivalents of $497,000,000 delivering continued strong cash generation. Over the last twelve months, operating cash flows have significantly exceeded net income, providing incremental opportunities to invest for profitable growth and return capital to shareholders. During the quarter, we repurchased approximately $33,000,000 worth of shares at a weighted average price of $6.8 nearly double the amount we purchased in the first quarter. As John mentioned, our Board recently authorized an amendment to our share repurchase program, increasing the program's repurchase authority to up to 300,000,000 Given our strong performance in the first half of the year, our visibility into the third quarter and a less severe tariff environment, particularly between The U.

[Bea Ordonez, CFO at Payoneer Global]

S. And China, we are reinstating 2025 guidance. We expect total revenue between $1,040,000,000 and $1,060,000,000 dollars above the full year guidance we issued in February. This includes higher interest income of $225,000,000 and $815,000,000 to $835,000,000 of revenue excluding interest income. We expect our growth rate for revenue excluding interest income to be fairly consistent from Q3 to Q4.

[Bea Ordonez, CFO at Payoneer Global]

The top end of our core revenue range is in line with our guidance in February, despite a more challenging macro environment. For the 2025, we anticipate high single digit growth in total volume and expect that our strategic focus on higher take rate products and geographies and pricing initiatives will enable us to continue to deliver yield expansion and revenue growth that outpaces volume growth. We expect volume from SMBs that sell on marketplaces to continue to grow by mid single digits and mid teens B2B volume growth in the second half of the year. We anticipate low double digit B2B volume growth in Q3 accelerating to high teens in Q4 as strong rest of world B2B volume growth is partially offset by slower growth in our China B2B franchise. Given the lower take rate profile in China compared to other regions, we expect B2B revenue to grow at roughly 25% for the second half of the year.

[Bea Ordonez, CFO at Payoneer Global]

For the full year, we expect transaction costs as a percentage of revenue to be approximately 16.5%, significantly below our expectations at the beginning of the year and representing a modest step up transaction costs for the 2025. This reflects continued business mix shift towards higher take rate and also higher transaction cost products and geographies, as well as the impact of lower interest income. When excluding interest income, transaction costs as a percentage of revenue has been roughly stable over the past two years. We continue to work to optimize the economics of our business from a transaction cost perspective by utilizing our scale and leveraging and deepening our strategic relationships. We are actively working on a number of initiatives that leverage blockchain technology, bringing real time treasury management capabilities to our platform.

[Bea Ordonez, CFO at Payoneer Global]

We have rolled out real time funds transfer capabilities on chain in specific corridors, enabling us to move funds between global accounts with greater speed, automation, and transparency. In collaboration with SITI, we're excited for the opportunity to expand these capabilities to additional markets in the coming quarters. We also plan to extend these capabilities via other banking partners, further enhancing our treasury management flows and delivering enhanced capabilities to our customers. Additionally, we recently signed a new long term agreement with Mastercard further solidifying this important strategic relationship. We have seen substantial growth in our card product since beginning this partnership over four years ago with nearly 6,000,000,000 of card usage over the trailing twelve months.

[Bea Ordonez, CFO at Payoneer Global]

We are further deepening our relationship and in partnership with Mastercard launching an SMB growth hub to better serve customers globally and to drive further innovation and engagement. We expect 2025 adjusted OpEx, which represents our guidance for revenue, less adjusted EBITDA and transaction costs of approximately $610,000,000 Our outlook for transaction costs is materially lower than we had anticipated at the start of this year and this enables us to make incremental investments in our business, including in regulatory licensing efforts in key jurisdictions, in scaling our card product, and in stablecoin focused initiatives. We are investing to support our long term growth trajectory while still expecting to exceed our 25% adjusted EBITDA margin target. Based on our strong performance in the first half of the year, we are raising our guidance for adjusted EBITDA, which we expect to be between $2.60 and $275,000,000. At the midpoint, this represents an adjusted EBITDA margin of approximately 25% for the full year.

[Bea Ordonez, CFO at Payoneer Global]

Excluding interest income, we expect adjusted EBITDA of 43,000,000 at the midpoint, over 3x the amount we generated in 2024 and in line with the target we have communicated at our fourth quarter results in February. Our 2025 guidance assumes a stable macro environment in the second half of the year and that global tariffs remain broadly comparable to today's levels. Our second quarter twenty twenty five results underscore the strength of our execution. In a dynamic macro and tariff environment, we grew revenues, expanded our SMB take rate, increased ARPU and delivered adjusted EBITDA in line with our communicated targets. We are well positioned to deliver on our full year guidance and remain focused on creating long term shareholder value.

[Bea Ordonez, CFO at Payoneer Global]

We are now happy to answer any questions you may have. Operator, please open the line.

[Operator]

Thank you. We will now begin the question and answer please press star one on your telephone keypad to raise your hand and join the queue. If you would like to withdraw your questions, simply press star one again. If you are called upon to ask your question and are listening via speakerphone in your device, please pick up your handset to ensure that your phone is not on mute when asking your question. We do request for today's session that you please limit to one question and one follow-up and requeue for any additional question.

[Operator]

And our first question comes from the line of Nate Svensson with Deutsche Bank. Your line is open.

[Nate Svensson, Director, Senior Equity Research Analyst - Payments, Processors & IT Services at Deutsche Bank]

Nice results and great to see the reinstated guide. Maybe at the highest level, just given there are so many headlines still going around on tariffs, what gave you the confidence to reinstate that higher guide and at a slightly higher level than what we saw previously? Maybe more explicitly on tariffs, I know B, you called out that tariffs, the levels stay at broadly the same level as what we have today. Any other explicit impact baked in from tariffs? I know previously you had called out that $50,000,000 number.

[Nate Svensson, Director, Senior Equity Research Analyst - Payments, Processors & IT Services at Deutsche Bank]

I assume it's probably lower today than it was on the last call. And then last thing, you mentioned slower volume at some large e com platforms. Anything else that you're supposedly seeing with regards to tariffs in 2Q numbers or this quarter to date?

[Bea Ordonez, CFO at Payoneer Global]

Sure. Thanks for the question, Nate. Look, so as you noted, we held the top range of our core revenue guidance in line with the full year guidance we gave back in February. We raised at the midpoint. We raised our adjusted EBITDA at the midpoint as well, all as we continue to navigate and our customers continue to navigate this super dynamic environment.

[Bea Ordonez, CFO at Payoneer Global]

And we reinstated guidance. Look, to your point, we're obviously a quarter out from when we reported last, which was in May and barely three weeks out from the original three to four weeks, the original tariff announcement. We have greater visibility into what the tariff environment is likely to look like. It is obviously much less severe, certainly as between the China US corridor. We have some degree of visibility into Q3, and we're beginning to see the outlines of how we might expect the business to perform overall and felt very comfortable in our ability to continue navigating.

[Bea Ordonez, CFO at Payoneer Global]

We have a very resilient business as our guidance clearly demonstrates and feel confident about navigating to hit our full year guidance through the end of the year. In terms of marketplace volumes, look, we called out some modest softening in the back half of Q2. It's always difficult to attribute the exact cause, but likely related to some tariff impact. We had said back in May that tariff impacts, when we see them, would likely be felt in the back half of the year, and our guidance implies some modest softening in marketplace volumes, to about the mid single digit range in terms of volume growth. So all of that is embedded.

[Bea Ordonez, CFO at Payoneer Global]

We don't provide and we're not gonna provide an explicit number for tariff headwind. We've embedded assumptions based on how we understand the environment today.

[Nate Svensson, Director, Senior Equity Research Analyst - Payments, Processors & IT Services at Deutsche Bank]

Yeah, super helpful. Bien, obviously, don't envy your position given all the changes that are going on. I do have to ask about stablecoins. I think given sort of the merchants you serve and the role you play in the B2B payments ecosystem, I actually think there's a real role for Stablecoins here in helping you serve your end customers. And it was great to hear some of the initiatives that you're undertaking on the Payoneer side of things.

[Nate Svensson, Director, Senior Equity Research Analyst - Payments, Processors & IT Services at Deutsche Bank]

But I'd be really interested to hear what merchants are telling you with regards to their demand or appetite to adopt stablecoins. Spend a lot of time debating the topic with investors, but it would be great to hear how real this is for the merchants that you're serving on a day to day basis.

[John Caplan, CEO & Director at Payoneer Global]

Yeah, this is John. Thanks for the question. The I think we are in the earliest, earliest days of understanding both the use cases and the demand among merchants, right? As we've mentioned on the call we believe that the, we have an exceptional set of assets and relationships with customers and trust with our banks and our marketplace partners globally to help take our deep customer relationships, our global distribution to add new currencies into the experience for our customers as they seek to use them. And our last mile relationships enable us to help customers turn whatever currency they're doing business in into the local fiat that they use domestically. And so we see a long term opportunity. I think a lot of the hype cycle is exciting but the practical use case and I think what hopefully investors have gotten comfortable with the way we run Payoneer today is we are very pragmatic about helping our customers participate in the global economy. And right now they primarily do that in dollars and we're helping them do that exceptionally well.

[John Caplan, CEO & Director at Payoneer Global]

And as they explore the use of new currencies and new ways of transacting, we will be there to support them.

[Nate Svensson, Director, Senior Equity Research Analyst - Payments, Processors & IT Services at Deutsche Bank]

Thanks, John. Look forward to tracking the progress there.

[John Caplan, CEO & Director at Payoneer Global]

Thanks.

[Operator]

Our next question comes from the line of Trevor Williams with Jefferies. Your line is open.

[Trevor Williams, Managing Director at Jefferies LLC]

Thanks. Good morning, guys. I wanted to ask on China specifically and just how merchants there have responded to the tariffs and thinking kind of about more distribution into Europe or rest of world. John, I think in your prepared remarks, I heard you say that now about a third of your China revenue is coming from selling into non US markets. I'm curious how that number has changed more recently and just bigger picture if the current environment has kind of helped accelerate any of your share gains locally in China to be able to facilitate sales into kind of more non US markets? Thanks.

[John Caplan, CEO & Director at Payoneer Global]

Thanks Trevor. It's a great question and an important one. We've held 15 events in China for sellers looking to expand across Europe, Latin America and Middle East really bringing together an ecosystem of partners to help them think about through the logistics, tax, legal considerations when they're expanding. So we are our customers partners as they help them explore expanding. They're very focused on expanding particularly in Europe and Latin America and our green channel program has had I think the best ever demand of that product we've seen as customers look to explore ways to drive their distribution and improve the resilience of their business models, not just selling to The United States but selling globally.

[John Caplan, CEO & Director at Payoneer Global]

A third of our revenue comes from Chinese customers. Of that 20% is China to The US. Approximately 10% is China to the rest of the world. And we have not seen a significant shift in that composition in Q2. It's really I think too soon to see it.

[John Caplan, CEO & Director at Payoneer Global]

What I do think is really important is how dedicated the China sellers are to their US distribution and what they see the events of April 2 as a catalyst, a springboard to force them into more global distribution both of which will serve Payoneer well in the long term.

[Trevor Williams, Managing Director at Jefferies LLC]

Okay.

[John Caplan, CEO & Director at Payoneer Global]

I'll just add one other note about that. As we saw our China customers holding increased balances on the platform. You saw the balances grow by 17% Q2 year over year. That balance growth is future revenue growth for us and I think that's something just important to highlight.

[Trevor Williams, Managing Director at Jefferies LLC]

Okay. No, that's helpful. Thanks, John. And then just as my follow-up, within the ICP growth and I know it's an imperfect metric, maybe you guys could parse out some of the puts and takes within some of the headline growth rates there both on kind of the overall and then the 10,000 a month ICP growth would be great. Thanks.

[John Caplan, CEO & Director at Payoneer Global]

Yeah. We made we made a very conscious, and we've been talking about it at length. We made strategic shifts over the past year to align our resources focusing on durable and profitable revenue growth. And our ICP portfolio really reflects those decisions. If you go back all the way to 2023, 23% of our total customers are ICPs.

[John Caplan, CEO & Director at Payoneer Global]

In in 2025, it was 28%. So we've, you know, continually driven ICPs as a percentage of our total portfolio. We're driving faster b to b customer growth which is very exciting for us. We're targeting larger multi entity customers. Those that bring in quarter of a million dollars a month in volume and greater.

[John Caplan, CEO & Director at Payoneer Global]

They use more products. They have more complex needs. They stay longer. Our net revenue retention for those, that cohort is exceptionally strong. And we continue to fine tune our risk appetite across the portfolio generally to make sure that the folks that we add to the platform reflect our focus in the long term.

[John Caplan, CEO & Director at Payoneer Global]

So in Q2 volume growth from 10 ks plus ICPs, we saw 20% volume growth, really exceptionally and exciting for us in our business. And I'm pleased by the execution of the team, and we continue to drive cross sell and momentum in the portfolio. We I expect the ICP growth to be, as I've said in the past, you know, the word we like to use around here is lumpy. Right? Some quarters it's up.

[John Caplan, CEO & Director at Payoneer Global]

Some quarters it's down. Some quarters it's flat. It has to do with the overall portfolio mix. What we're focused on doing to drive ICP growth, we're beginning to work with reseller programs which is an exciting innovation. We have more and more deep focus into specific regions and we're driving our funnel conversion for the over 11,000,000 people who show up at payoneer.com to start creating Payoneer accounts.

[John Caplan, CEO & Director at Payoneer Global]

We have an exceptional brand, great relationships, last mile delivery that entrepreneurs around the globe are increasingly coming to us to, to be their foreign bank alternative as they grow their business.

[Trevor Williams, Managing Director at Jefferies LLC]

Appreciate it. Thanks guys.

[Operator]

Next question comes from the line of Will Nance with Goldman Sachs. Your line is open.

[Will Nance, Vice President at Goldman Sachs]

Hey guys, thanks for taking the questions and congrats on the great quarter and reinstatement of guidance. Great to see. I wanted to ask on the B2B volume growth. Came in at high teens. I think the guidance was kind of low double digits and then back to high teens.

[Will Nance, Vice President at Goldman Sachs]

And you alluded to some kind of moving pieces in the China B2B corridor. So I was wondering if you could expand a bit on that. I know that's been kind of an ebb and flow type of region for you. Like would you is there something going on there in the market from a competitive perspective? Would you attribute this more to just the macro environment and some of the things that you called out on the SMB e commerce corridor?

[Will Nance, Vice President at Goldman Sachs]

And just talk through, I mean, how you view that exit rate in the fourth quarter, and I think you call that mid-20s ex China as kind of like a run rate as we think about going forward.

[Bea Ordonez, CFO at Payoneer Global]

Thanks for the question, Will. So yeah, look, we've talked in the past about our b to b business and really sort of drawn the distinction between the China business, which is a goods business by and large, and the rest of world business, which is a services business, the relative differences in those two business lines for us or in those two portfolios. Just to sort of level set again, our b to b rest of world portfolio is about 80% of total b to b volume and about 90% of the revenue and China makes up the rest. Right? Our China portfolio, I like the term you used, has seen some ebbs and flows.

[Bea Ordonez, CFO at Payoneer Global]

Right? We have a a relatively speaking, tiny slice of a very big market. We estimate the market in China from a goods perspective b to b to be about 2,300,000,000,000.0. We have a very tiny slice. These are bigger sellers.

[Bea Ordonez, CFO at Payoneer Global]

Serving b to b good sellers in China is more complex. Because they're bigger sellers, it's a more volatile portfolio just because the GMV per customer is larger. And so what we see in those ebbs and flows is a more volatile dynamic that in effect distorts the overall volume growth of the B2B portfolio as a whole. So yes, we've had sort of ebbs and flows or fits and starts with that. We're continuing to invest in finding product market fit in China.

[Bea Ordonez, CFO at Payoneer Global]

We see it as a really exciting adjacent opportunity given our strong brand in China, given our capabilities there. But today, it is tiny, and we see some of these fits and starts. Our rest of world business, which look at as we say, is more than 90% of that b to b, revenue, and it's worth noting our b to b revenue as a whole is about, a third of our total core revenue today. That revenue flow is growing, very impressively. We're showing, as we said in q two, 22% volume growth in that rest of world portfolio, and we're growing the revenue overall 37%.

[Bea Ordonez, CFO at Payoneer Global]

So as we move into the back half of the year, as you called out, Will, we're calling for low double digit growth in Q3, accelerating to high teens growth as we exit the year, higher than that from the rest of world perspective, and still feel very confident that we will hit more than 25% revenue growth overall. So this remains for us the real lever and driver of growth in our business given its growing importance to the portfolio as a whole.

[Will Nance, Vice President at Goldman Sachs]

That's super helpful and kind of dovetails with my next question, which is the take rate dynamics here. Obviously, you guys have just historically seen stronger growth in higher take rate regions, Latin America and APAC. B2B business is growing faster. Within the B2B business, you're seeing some mix out of China, so there's a mix dynamic. The e commerce business, there's an assumption of a little bit lower growth.

[Will Nance, Vice President at Goldman Sachs]

So I guess maybe when you zoom out, you look at all the pricing dynamics and take rate dynamics. Is there a way that you could kind of bucket some of the take rate expansion you're seeing kind of between mix related dynamics, macro related dynamics and anything else that you would kind of attribute it to on the pricing side? Appreciate it.

[Bea Ordonez, CFO at Payoneer Global]

Yeah, of course, Will. So look, I think what is often sort of not fully appreciated about our business is how consistently we've been able to demonstrate our ability to increase yields in our portfolio. We have driven take rate expansion in our SMB business for multiple consecutive quarters now, including in Q2 where we expanded our take rate by nine basis points, and we saw take rate expansion across the portfolio. Right? We grew our marketplace SMB take rate by two basis points.

[Bea Ordonez, CFO at Payoneer Global]

That's mostly a factor of increased card adoption. We grew our card portfolio 25%, record usage on our card in the quarter. We grew our b to b take rate by 26 basis points. That is, as you know, Will, in your question, somewhat a factor of geo mix, strong growth rest of world, relatively weaker growth as we just talked about in China, pricing power within that book, and adoption of our card as well, particularly in Latin America where we see really strong growth, as well as the acquisition of the workforce management business. Right?

[Bea Ordonez, CFO at Payoneer Global]

So lots of levers that we are deploying within that business to expand our yield, to expand our take rate. And similarly, within our checkout business. Right? We announced our partnership with Stripe. Really excited to see continued take rate expansion there.

[Bea Ordonez, CFO at Payoneer Global]

So as you said, we have sort of multiple drivers and impact, to that take rate. We don't really kinda look to decouple them and sort of explain each. But we're demonstrating additional utility and it shows up in the take rate that we're able to deliver quarter after quarter.

[Will Nance, Vice President at Goldman Sachs]

Yeah. No, that's great. Sounds like a lot of just organic take rate expansion, which is great to see. Appreciate you taking the questions and congrats again.

[Bea Ordonez, CFO at Payoneer Global]

Thanks, Will.

[Operator]

Our next question comes from the line of Chris Kennedy with William Blair. Your line is open.

[Cristopher Kennedy, Research Analyst - Financial Services & Technology at William Blair]

Good morning. Thanks for taking the questions and appreciate all the detail. There any way to think about the EBITDA margin profile ex float as you think about the business going forward over the long term?

[Bea Ordonez, CFO at Payoneer Global]

So look, I think the main way to think about it is that we have continued to drive expansion in our, I'll call it our core adjusted EBITDA profile. Right? At the midpoint, our guidance for adjusted EBITDA ex interest income is roughly 3x what we delivered last year, even as the environment is, as we've said, dynamic. Right? So we feel confident that even as we mix shift into more complex business lines, even as we make investments both organic and inorganic, that we continue to hit both our headline, I'll call it, adjusted EBITDA margin target of 25%, but importantly and critically continue to improve the overall profitability dynamics of the core business excluding interest income and you're seeing that show up in the number in the first half of this year.

[Bea Ordonez, CFO at Payoneer Global]

We've already delivered more core adjusted EBITDA than we did for all of 2024 and we expect to continue to accelerate into the back half of the year even as we make investments and we're continuing to invest, as John said in his prepared remarks, in our licensed infrastructure that is an important enabler of our business and an important moat around our business. We're continuing to invest in our platform capabilities and the team that supports it, by expanding in India as we discussed, and we're continuing to make investments in our money market infrastructure and last mile capabilities, which ultimately unlock the additional opportunities within our ecosystem. So we feel very comfortable with the trajectory that we're taking.

[Cristopher Kennedy, Research Analyst - Financial Services & Technology at William Blair]

Understood. Thank you for that. And then as a follow-up, you talked about implementing blockchain to improve your treasury management operations. Can you just talk a little bit more about kind of the benefits that you are seeing from that or what you can see from that? Thank you.

[Bea Ordonez, CFO at Payoneer Global]

Sure. Happy to. Look, as John said in his prepared remarks, one of the unique assets that we think positions us really well to drive adoption of Stablecoin, to integrate the important capabilities of Stablecoin into our ecosystem, is really our last mile infrastructure. Right? In a very real world, we solve for the last mile challenge, the AILs adoption in certain use cases around stablecoins.

[Bea Ordonez, CFO at Payoneer Global]

Right? Ultimately, users need to be able to, yes, receive stablecoin within, their ecosystem, but ultimately to off ramp it to other use cases within their local jurisdictions or otherwise. So we have, as we've talked in the past in other contexts, an extensive bank and PSP network that allows us to solve for that, challenge. So what we've already done and one of the the well known use cases, as you know, Chris, from a a stable coin adoption perspective is internal treasury management capabilities. What we've done is already to integrate via one of our, banking partners, Citi, their capabilities to move tokenized funds through their global network to integrate those capabilities into our own treasury management capabilities.

[Bea Ordonez, CFO at Payoneer Global]

And what that gives us is an ability to move funds 24 by seven so we're not sort of beholden to cut off times and so on to get automation of those movements, to get programmability of those movements, and overall to really enable better capabilities internally and therefore enable better capabilities within our ecosystem for our customers. That's what we're doing sort of with the broader context. So this is an exciting real world use case for us and we're continuing to expand and it adds real value to how we manage our ecosystem from a liquidity perspective, from a risk perspective, from an FX perspective.

[Cristopher Kennedy, Research Analyst - Financial Services & Technology at William Blair]

Got it. Thanks for all the color.

[Operator]

Next question comes from the line of Sanjay Sakhrani with KBW. Your line is open.

[Sanjay Sakhrani, Managing Director at Keefe, Bruyette & Woods (KBW)]

Thank you. Good morning. I have one more on tariffs, which was, as we've seen the tariff drama sort of unfold, I'm just curious if you've seen any more resiliency from your customers and sort of how to evolve their business around tariffs. So just as we think about what might be on the come, how different you guys feel about their ability to deal with tariffs on a go forward basis? And then just one related point.

[Sanjay Sakhrani, Managing Director at Keefe, Bruyette & Woods (KBW)]

I mean, there been any impact from your customers on this de minimis exemption going away? I'm just curious as we think about that China to U. S. Corridor, how we see that playing through? Is the full impact in there already? Or could there be a residual one? Thank you.

[John Caplan, CEO & Director at Payoneer Global]

Thanks, N. J. There is no impact from the de minimis really of any I think we talked about in the past is single digit low single digits and not an impact for us. What I think you, what I think is important to note about our customer book is we have 2,000,000 entrepreneurial creative hardworking hustling business owners in 01/1990 countries and territories committed to growing their businesses. So we benefit from their grit frankly and their grit suggests that they are very focused on globalizing their businesses even more, driving increased distribution, cleaning up their portfolios of products to make sure that they're selling the right products in the right markets at the right price.

[John Caplan, CEO & Director at Payoneer Global]

So we haven't seen anything other than impressive entrepreneurship from the entrepreneurs we serve and great effort from the Payoneer team. I mentioned before the 15 events we've done in China, the work our teams are doing across the globe. I shared in my prepared remarks the case study of brand five zero one which is a business that is using Payoneer for B2B wholesale activity, using our cards for expenses, using checkout for the direct to consumer work and selling on marketplaces. Those are the kind of customers we love serving and provide them a full financial stack solution for their international operations.

[Sanjay Sakhrani, Managing Director at Keefe, Bruyette & Woods (KBW)]

Got it.

[Sanjay Sakhrani, Managing Director at Keefe, Bruyette & Woods (KBW)]

And I guess I got one more on stablecoins. Obviously, encouraging that you're incorporating it your business. I'm just curious, the one question we just get quite frequently is sort of the disruptive threat. I'm just curious sort of how you guys think about it being a disruptive threat. I know there's lots of advantages to your model.

[Sanjay Sakhrani, Managing Director at Keefe, Bruyette & Woods (KBW)]

But I'd love to just hear from you in terms of sort of how you guys think about that angle of it. Thanks.

[Bea Ordonez, CFO at Payoneer Global]

Yeah. Look, thank you for the question. Like any new innovation or new technology, it can be disruptive, right? It's whether you're well positioned to take advantage of the disruption and we are confident that we are. Again, what has been a headwind to adoption, to stablecoin more broadly, and it's obviously growing massively and as John said, we welcome the regulatory clarity that comes with the Genius Act.

[Bea Ordonez, CFO at Payoneer Global]

But some of the headwinds to broader adoption have been solving the last mile challenge. We can do that. The complexity for end users of managing multiple wallets and keys and cold storage and all of that, we can integrate. And today, we already provide a single utility, if you like, that allows users to manage currencies and to hold funds across a complex ecosystem. So we already abstract that complexity today within our ecosystem, and we feel we're well positioned to do that, which is why we're focused on looking to add digital wallet capability.

[Bea Ordonez, CFO at Payoneer Global]

So, again, disruptive any innovation can be disruptive. We're well positioned. Ultimately, for us, we view the value, as being able to seamlessly connect those modern digital currencies with all of the value that that comes in terms of programmability and real time settlement with the legacy banking infrastructure and rails that we have within our ecosystem in a way that is user friendly and enables the ultimate business needs of the customers that you're serving. We're well positioned to do that. We're we're excited.

[Bea Ordonez, CFO at Payoneer Global]

So we we view it as a long term, opportunity for us.

[Sanjay Sakhrani, Managing Director at Keefe, Bruyette & Woods (KBW)]

Thank you.

[Operator]

Next question comes from the line of Mayank Tandon with Needham and Company. Your line is open.

[Mayank Tandon, Senior Analyst at Needham & Company]

Thank you. Good morning. John or B, are you able to share any metrics around churn levels either by segment or for the company as a whole? I'm just curious to see if there's any impact from the higher tariffs uncertainty and sort of related would be, you had more difficulty onboarding customers because there might be resistance to working with you just given some of the uncertainty in the market? So curious around like churn and potential for onboarding customers because of the uncertainty.

[John Caplan, CEO & Director at Payoneer Global]

Thanks for the question. Our revenue retention has continued to improve modestly year over year, and we see retention as a very exciting opportunity for us. It's one of the reasons why we've moved the portfolio towards customers and focused on specific geographies. And given the profile of our customer base, as you'd expect, we see higher volume and revenue retention than we do individual logo retention. That's sort of the nature of the game when you serve small businesses.

[John Caplan, CEO & Director at Payoneer Global]

Our ICP retention is significantly higher than our non ICP retention. And retention of our managed ICPs, you know, a call out to some of the extraordinary people that work at Payoneer. We have local teams on the ground serving customers and high, in emerging markets, part of their local ecosystem, speaking the local language. Our managed ICPs, those that have the relationships directly with the CSM perform better than the non managed or unmanaged ICPs. And the team is working hard at productizing management services ICPs as we scale.

[John Caplan, CEO & Director at Payoneer Global]

And the retention in general is an increasing focus for us. And I think the work the team has done to put in place tools to help us both track, manage, cross sell our ICPs are working and we're pleased with our progress there.

[Mayank Tandon, Senior Analyst at Needham & Company]

Got it. Okay. I'll move to maybe a more

[John Caplan, CEO & Director at Payoneer Global]

Oh, you asked a second.

[Mayank Tandon, Senior Analyst at Needham & Company]

Sure.

[John Caplan, CEO & Director at Payoneer Global]

Sorry, Mike. You asked a second question which I just was reading in my notes. It said, are customers hesitant to onboard because of tariffs? I think quite to the contrary, we saw ICP growth in China at 11% growth. So we, you know, we are not seeing reticence.

[John Caplan, CEO & Director at Payoneer Global]

I think the opposite. People, you know, to be point about stable coins generally, we are trusted. And being trusted means that folks are turning to Payoneer to participate in the global economy.

[Mayank Tandon, Senior Analyst at Needham & Company]

Got it. Actually, you answered my second question, so I'll ask something else instead, which is, you mentioned the facility in Gurgaon. I just want to understand, is that going to be showing up in terms of operating expenses on the R and D line? Or what is sort of the motivation behind that? Is that more because it's about able to hire engineers to do R and D in a hub like India?

[Mayank Tandon, Senior Analyst at Needham & Company]

Or what are some of the main factors behind this initiative?

[Bea Ordonez, CFO at Payoneer Global]

So look, happy to take the question. Look, in general, we're looking to operate our ecosystem with a view to ensuring resilience, recruiting the best talent, and having access to the best talent as we continue to invest in our platform more broadly. We have a fantastic team based out of Israel that support our platform. We have folks all over the world. As you know, we're a very global company.

[Bea Ordonez, CFO at Payoneer Global]

We did a ton of research, and India represents a real opportunity. We already have a foothold there, as part of our workforce management acquisition and in other areas. It represents a real opportunity to tap into one of the largest tech talent hubs in the world. So, yes, it will be, incremental, investment into our platform. It gives us resilience, access to a bigger pool of talent. That is important. And we will continue to manage to the medium term adjusted EBITDA targets that we have talked about and feel very comfortable that we can do that.

[Mayank Tandon, Senior Analyst at Needham & Company]

Great. Thank you so much for taking my questions.

[Operator]

And our last question comes from the line of Daniel Peller with Wolfe Research. Your line is open.

[Daniel Krebs, Senior Associate at Wolfe Research, LLC]

Hi, thanks. This is Daniel Krebs on for Darren. I just wanted to follow-up on the great take rate expansion we've seen and how to think about that relative to Stablecoin integration. Any early sense of how you think about the unit economics of the Stablecoin off ramp versus a traditional payout? And if this presents any sort of headwind to consistent yield growth over time? Thank you.

[Bea Ordonez, CFO at Payoneer Global]

No. Thanks for the question. Look, think too early to say, right? What we have laid out why we think we can play in this space, we're exploring and making investments in the back half of the year to begin to build out that infrastructure. I think the take rate dynamics are going to depend very much on the particular use cases that we enable within our ecosystem.

[Bea Ordonez, CFO at Payoneer Global]

I think the overall sort of message that we wanna leave you with is obviously sort of what I said to to the other question that we have demonstrated consistent ability to, drive take rate expansion because we deliver more utility. And as we deliver more utility, whether that's access to more markets, whether that's a card product, whether that's a best in class checkout capability, we can command higher yield, and that shows up in the take rate. So stablecoin is really just one more aspect of that. And we feel good that we can continue to drive take rate expansion as we add to the financial stack, as we serve more complex customers with more complex needs. So what we again, we feel good about that trajectory and good about sort of how we're performing there.

[Daniel Krebs, Senior Associate at Wolfe Research, LLC]

Great. Thank you. And then maybe as a related follow-up, is is there any sense of what percentage of your revenues today are driven by FX conversion fees? And maybe if you could provide a sense of how this directionally has changed over time as you guys have broadened out the product suite? Thank you.

[Bea Ordonez, CFO at Payoneer Global]

Look, we've talked about it in the context of pricing strategy more generally where we saw an opportunity and we were able to sort of unlock it. We saw an opportunity to more effectively monetize FX within our ecosystem based on enhancements to the product, adding capabilities, and ensuring that we were monetizing those additional capabilities appropriately and also looking at corridor by corridor pricing and so on. So we've been able to optimize over time, and that has shown up in some of the pricing sort of discussions that we've had. We haven't sort of we don't disaggregate our revenue based on FX and core and so on. We we charge customers fees for the utility that we provide, and FX is one component of that.

[Operator]

We have no further questions and so I'll hand the call back to the management team for any closing remarks.

[John Caplan, CEO & Director at Payoneer Global]

Thank you everybody for your questions and your participation this morning. We really had a great second quarter and we're confident our strategy is working. We're excited about the opportunities in front of us and the strength of our platform, the resilience of our customer base and the focus on innovation that positions us to drive long term sustainable growth. I want to particularly thank our team for their relentless commitment and our shareholders for their continued trust. We're excited about what's next and we're just getting started as we like to say. Thanks everybody.

[Operator]

Thank you everyone. This concludes our call and you may now disconnect your lines.

Participants

Executives

• Michelle Wang, VP - IR
• John Caplan, CEO & Director
• Bea Ordonez, CFO

Analysts

• Nate Svensson, Director, Senior Equity Research Analyst - Payments, Processors & IT Services at Deutsche Bank
• Trevor Williams, Managing Director at Jefferies LLC
• Will Nance, Vice President at Goldman Sachs
• Cristopher Kennedy, Research Analyst - Financial Services & Technology at William Blair
• Sanjay Sakhrani, Managing Director at Keefe, Bruyette & Woods (KBW)
• Mayank Tandon, Senior Analyst at Needham & Company
• Daniel Krebs, Senior Associate at Wolfe Research, LLC