Flywire Corp Q1 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Timothy Chiodo - UBS - Analyst : Great. Thank you for taking the question. I want to talk a little bit about the UK mix. So you made some comments around the momentum in the UK. At least in estimates, I believe the UK business is just shy in terms of its mix of revenue relative to the US. So it's a pretty important market. If you could talk just broadly around kind of a rough range around the type of growth you're seeing in the UK. The reason for this is we can kind of get a sense of the growth contribution. So it's roughly 20% of revenue growing roughly XY percent-ish. We can kind of get a sense of what the revenue growth contribution is. Thanks.

Question: Tien-Tsin Huang - JPMorgan - Analyst : Thanks so much. I'm just curious, just thinking about the sources of upside this quarter. It sounds like it was Australia, of course, travel. But is there a way to maybe to rank in reminds what came in a little bit ahead of plan? And where do you have a little bit more conviction on growth versus REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 06, 2025 / 9:00PM, FLYW.OQ - Q1 2025 Flywire Corp Earnings Call the last time we got on the call together. I heard where the visibility is tough. I'm curious where you have maybe a little bit more conviction on the upside.

Question: Tien-Tsin Huang - JPMorgan - Analyst : Just really quickly, I know it's probably not in the minds of everyone, it's just health care is doing a little bit better in terms of your outlook there as well. Does it feel like you're sort of turning the corner and getting to a good place because it does feel like it's very insulated from everything that everyone was worried about.

Question: Dan Perlin - RBC Capital - Analyst : Thanks, Mike, you made a comment about education, shifting to some maybe nontraditional markets. I think you said you got the big four, it's 40% of global education, but you have like 20 other markets that represent another 40%. So my question is how much of those, let's say, 20 markets REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 06, 2025 / 9:00PM, FLYW.OQ - Q1 2025 Flywire Corp Earnings Call today is Flywire addressable and then if there's not the case, is there something that you can bring to bear in that market, let's say, in the next 6 to 9 months?

Question: Dan Perlin - RBC Capital - Analyst : I'm sorry.

Question: Dan Perlin - RBC Capital - Analyst : Got it. That's great. Thanks for the clarity. Just a quick follow-up on the travel customer growth. In one of the slides, I mean, you put up some interesting dynamics there and you also put the revenue growth kind of contributions over kind of a year-on-year perspective. I guess the question is when we think about like the implementation backlog, how big is that today? And kind of what time frame would you be thinking about getting that converted?

Question: Tyler DuPont - Bank of America - Analyst : Good afternoon. This is Tyler DuPont on for Jason. I wanted to start by asking about the competitive positioning within education and whether there have been any changes to the landscape due to the current geopolitical environment? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 06, 2025 / 9:00PM, FLYW.OQ - Q1 2025 Flywire Corp Earnings Call It was encouraging to hear your SFS solution is beginning to gain more traction among higher ed institutions. But sort of given where we are today, it will be great to hear your thoughts. For example, are you seeing competitors competing more aggressively on price to win? Or is it more steady as she goes, just in a more muted demand environment? Just any clarity around competitive dynamics, given the market that we're in right now?

Question: Tyler DuPont - Bank of America - Analyst : And then just any update regarding the operational and business portfolio review you mentioned? I Know you mentioned it a bit in the prepared remarks, but just sort of perhaps if you can clarify how far along in the process we are? How we should be thinking about margin implications? See FY25 margin expansion guide is now 200 bps at the midpoint. I think it was 300 bps as of last quarter. Is any of that due to the review? What sort of investments are you making there to that's driving that? Just any clarity around the review and margin implications?

Question: Chris Kennedy - William Blair - Analyst : Yeah. Good afternoon. Thanks for taking the questions. The disclosures comparing the education versus the travel vertical are interesting. Is there any way to think about the NRR opportunity between the two verticals?

Question: Chris Kennedy - William Blair - Analyst : And then just, I guess, a follow-up to that. When you think about NRR for the company, I mean, historically, it's been over 120%. And it's 114% last year, going to come down a little bit. But when you think about the long term, can you kind of talk about where you think this business should be at?

Question: Charles Nabhan - Stephens - Analyst : Hi, good afternoon, and thank you for taking my question. I just had a modeling question about EBITDA for the back half of the year. And I understand that things are very fluid and subject to change. But if my math is correct, it's coming out to about 40 bps of expansion in the second half of the year. I'm just curious how we should think about that from a cadence standpoint in the third and the fourth quarter as it stands today, how you're thinking about the timing of investments or any other puts and takes there?

Question: Charles Nabhan - Stephens - Analyst : And as a follow-up, I wanted to ask about the gross profit per customer slide, slide 18, particularly for travel. The expansion potential is pretty remarkable there, but if I'm looking at that chart, there's a bit of a dip from year one to year two, and then there's a pretty significant ramp up from three to four. I was hoping you could kind of walk us through how business -- how that expands over the course of a travel customer relationship. This seems to be a little different from what we're used to within the education vertical. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 06, 2025 / 9:00PM, FLYW.OQ - Q1 2025 Flywire Corp Earnings Call