Payoneer Global Inc. · NASDAQ:PAYO
Payoneer Global — Q1 2024 Earnings Presentation
26 slides from Payoneer Global's earnings presentation, May 8, 2024
Slide 1: 1Q 2024 Earnings Supplement
1Q 2024 Earnings Supplement Nasdaq: PAYO May 8, 2024
Slide 2: Disclaimers
Disclaimers This presentation does not constitute an offer to sell, a solicitation of an Non-GAAP Financial Measures similarly titled measures of other companies. offer to buy, or a recommendation to purchase any security. You should not construe the contents of this presentation as legal, tax, acco
Slide 3: Payoneer's mission: connect the world's underserved businesses
Payoneer’s mission: Connect the world’s underserved businesses to a rising, global economy 3
Slide 4: SMBs want to grow globally but transacting across borders is complex
SMBs want to grow globally but transacting across borders is complex, especially from emerging markets Can’t Can’t Can’t • My U.S. customers don’t want to send an • I want to match the currencies of my revenue • Why don't local lenders underwrite international money transfer to pay me, but I with my
Slide 5: 80M underserved SMBs
Global banks 80M Underserve small businesses underserved SMBs Fintech Primarily for P2P, and Need cross-border, with limited geographies B2B financial solutions designed for small Local banks businesses Underserve cross-border needs Source: Third-party research. 5
Slide 6: Payoneer serves diverse customer types
Payoneer serves diverse customer types and help SMBs in the fastest growing markets do business globally Contractors and Consumer goods Service Goods traders freelancers sellers providers and manufacturers Examples Pedro, Contractor Kevin, Elegoo Hannah, Accentline Serhii, Ukragroenergyinvest Brazil
Slide 7: We have unique assets and infrastructure
We have unique assets and infrastructure • Financial services institution regulated • Virtual account so customers are • 1.98M active customers, including across key markets, including US, always local, no matter where they 530K active Ideal Customer Europe, Hong Kong, Japan, Australia, are and who
Slide 8: We are pursuing a $6 trillion opportunity
We are pursuing a $6 trillion opportunity Audiences Manufacturers Services SMBs Goods merchants Contractors / freelancers Marketplace SMB Consumers SMB SMB Businesses Cross-border payment needs Source: Third-party research. Industry data and Payoneer volume market share as of 2022. 8
Slide 9: Payoneer is the multi-currency financial stack optimized for the global SMB
Payoneer is the multi-currency financial stack optimized for the global SMB Collect accounts receivable Access opportunity globally Manage accounts payable Merchant services Payoneer card (Checkout) B2B invoice Financial stack Withdraw money for global SMBs to bank account B2B load funds Manage and
Slide 10: ~2M customers use our cross-border AR, cash management, and AP solutions
~2M customers use our cross-border accounts receivable, cash management, and accounts payable solutions Accounts Receivable Cash Management Accounts Payable Merchant services Treasury Payoneer card B2B invoice Currency management Withdraw to bank account B2B load funds Intranetwork payments Pay vend
Slide 11: 21% volume growth in 1Q'24 driven by diverse channels
Accounts Receivable 21% volume growth in 1Q’24 driven by the diverse channels our customers sell through Enterprise volume direct to SMB customer volume into Payoneer Accounts bank account Defend our market leading Accelerate growth in a Expand into a fast-growing Drive continued scaled, position ma
Slide 12: Growing customer funds and significant interest income
Cash Management We are trusted, growing customer funds, and earning significant interest income Customer funds ($B) • $231M of interest income earned on customer funds in 2023 and $65M in 1Q’24 • 80%+ of customer funds are interest-bearing 8% $5.9 $5.5 • 74% of customer funds are held with U.S. dome
Slide 13: Proven track record of cross-selling accounts payable capabilities
Accounts Payable Proven track record of cross-selling our accounts payable (AP) capabilities Usage by number of products used by a customer 1 AP product 38% 38% 36% 34% 33% 32% 32% 30% 31% Larger SMBs have more complex AP needs. 22% 21% 22% 20% 20% 20% As we enhance our 2 AP products 23% 22% 22% pro
Slide 14: Focus on Ideal Customer Profiles (ICPs)
We are focused on our Ideal Customer Profiles (ICPs) because they represent the vast majority our revenue Customers % of total revenue 57K >50% $10K+/month ICPs 530K Active ICPs1 473K ~25% $500-$10K/month ICPs 1.4M <10% <$500/month non-ICPs Active non-ICPs 1.98M active customers ~90% + Enterprise pa
Slide 15: Faster ICP growth in higher take rate regions
We are driving faster ICP growth in higher take rate regions and with larger, higher volume ICPs Active ICPs (‘000s) Active ICPs (‘000s) 530 530 491 69 491 57 +13% 62 50 YoY +15% 104 YoY in 93 higher take rate regions 106 127 473 +7% 441 YoY 93 98 108 102 29 30 1Q23 1Q24 1Q23 1Q24 N. America Europe
Slide 16: Revenue growth reflects accelerating momentum
Revenue growth reflects accelerating momentum Total Revenue ($M) Revenue excluding interest income and onboarding fees from an enterprise client1 ($M) 19% $228 $224 $208 $159 $163 $207 $144 $148 $192 $134 21% 14% 8% 5% 5% 1Q23 2Q23 3Q23 4Q23 1Q24 1Q23 2Q23 3Q23 4Q23 1Q24 Year-over-year growth rate 1
Slide 17: Operating leverage even as transaction costs increase
We are delivering operating leverage even as transaction costs increase due to business mix shift Transaction cost as a percentage of revenue Adj. EBITDA ($M) and adj. EBITDA margin (%) 16.2% 14.9% 68% 14.6% $65 14.1% 13.8% $56 $58 $52 $39 29% 28% 27% 23% 20% 1Q23 2Q23 3Q23 4Q23 1Q24 1Q23 2Q23 3Q23
Slide 18: Our strategy for profitable growth
Our strategy for profitable growth Efficient go-to-market Comprehensive financial Optimized operations and approach for ICP stack for ARPU growth and capital allocation acquisition and retention TAM capture + + $205 Organic 25% Partnerships 8% 6% 2% $48 Sales & Marketing $6 $28 2020 2021 2022 2023 C
Slide 19: Cash flow generation enables capital return to shareholders
Our strong cash flow generation enables us to return capital to shareholders and maintain strategic flexibility Operating cash flows ($M) $40M $51M $587M $159 Operating Share Cash and cash cash flows1 repurchases1 equivalents $84 $40 $20 $4 2021 2022 2023 1Q23 1Q24 Note: data as of March 31, 2024. 1
Slide 20: 2024 full year guidance as of May 8, 2024
2024 full year guidance as of May 8, 2024 $895-905M ~17.5% $200-210M Revenue Transaction costs as a % Adjusted EBITDA1 of revenue Guidance for fiscal year, where adjusted, is provided on a non-GAAP basis, which Payoneer will continue to identify as it reports its future financial results. The Compan
Slide 21: Our roadmap to profitable growth
Our roadmap to profitable growth Medium-term Long-term (through 2026) (beyond 2026) Mid-teens 20%+ revenue growth revenue growth 25% 25%+ Adjusted EBITDA margin Adjusted EBITDA margin 21
Slide 22: Appendix
Appendix ©Payoneer
Slide 23: Volume and revenue trends
Volume and revenue trends Volume ($M) 1Q23 2Q23 3Q23 4Q23 1Q24 YoY QoQ SMBs that sell on marketplaces $9,770 $9,921 $10,261 $11,777 $11,002 13% -7% B2B SMBs 1,678 1,759 1,781 2,156 2,232 33% 4% Merchant services 29 41 63 102 92 217% -10% volume growth SMB customer volume $11,477 $11,721 $12,106 $14,
Slide 24: ICP and revenue by region trends
ICP and revenue by region trends Active ICPs ('000s) 1Q23 2Q23 3Q23 4Q23 1Q24 YoY QoQ By size: $500-$10K/month 441 443 449 461 473 7% 3% $10K+/month 50 52 53 55 57 13% 3% Total 491 495 502 516 530 8% 3% By primary regional market: APAC 106 109 114 121 127 19% 5% Europe 108 106 102 100 102 -6% 2% SAM
Slide 25: Reconciliation of net income (loss) to adjusted EBITDA
Reconciliation of net income (loss) to adjusted EBITDA Twelve months ended, ($ in thousands) Dec. 31, 2020 Dec. 31, 2021 Dec. 31, 2022 Dec. 31, 2023 Net income (loss) $ (23,746) $ (33,987) $ (11,970) $ 93,333 Depreciation & amortization 17,095 17,997 20,858 27,814 Taxes on income 8,320 8,711 13,586
Slide 26: Thank you.
Thank you. payoneer.com