Flywire Corp SEC 10-K Report

Flywire Corp, a leading global payments enablement and software company, has released its 2024 10-K report, showcasing significant financial growth, strategic acquisitions, and an expanded global footprint. The report highlights the company's robust performance in the payments industry, driven by its next-gen payments platform and proprietary global payment network.

Financial Highlights

Flywire Corp reported strong financial performance for the year ending December 31, 2024:

• Revenue: $492.1 million, an increase of 22.1% from the previous year, driven by growth in transaction payment volumes and new client acquisitions.
• Gross Profit: $306.9 million, reflecting a gross margin of 62.4%, up from 61.4% in the prior year, indicating improved efficiency in cost management.
• Net Income: $2.9 million, compared to a net loss of $8.6 million in the previous year, highlighting a significant turnaround in profitability.
• Adjusted EBITDA: $77.9 million, representing an adjusted EBITDA margin of 16.4%, up from 11.0% in the prior year, demonstrating enhanced operational efficiency.

Business Highlights

Flywire's business performance in 2024 was marked by several key operational achievements:

• Next-Gen Payments Platform: Flywire's platform facilitates global payment flows across multiple currencies and payment types, integrating seamlessly into clients' existing apps and workflows. It offers tailored invoicing, settlement, reconciliation tools, and flexible payment plans, enhancing the accounts receivable process.
• Proprietary Global Payment Network: The network includes global, regional, and local banking partners, enabling payments in over 240 countries and territories and in more than 140 currencies. It supports a variety of payment methods, including local bank transfers and digital wallets, optimized for regulatory and compliance standards.
• Vertical-Specific Software: Flywire offers software tailored to the education, healthcare, travel, and B2B sectors, integrating with clients' existing systems to streamline payment processes and enhance customer engagement through interactive dashboards and reporting tools.
• Client Growth and Retention: As of December 31, 2024, Flywire serves approximately 4,500 clients globally, with significant presence in education, healthcare, travel, and B2B sectors. The company reported a net dollar-based retention rate of approximately 114% for 2024.
• Geographical Expansion: Flywire has expanded its global reach, now operating in over 240 countries and territories, supporting more than 140 currencies, and leveraging local market knowledge to enhance its payment network.
• Acquisitions: In 2024, Flywire acquired Invoiced, a SaaS B2B company, and Sertifi, a hospitality-specific software and payments platform, to enhance its service offerings and expand its client base.
• Channel Partnerships: Flywire has formed partnerships with financial institutions like Bank of America and payment providers such as China UnionPay, enhancing its indirect sales strategy and expanding its ecosystem.
• Future Outlook: Flywire plans to continue expanding its client reach, increase payments platform monetization, and pursue strategic acquisitions to complement its organic growth. The company aims to leverage its Flywire Advantage to scale into new verticals and geographic markets.

Strategic Initiatives

Flywire has undertaken several strategic initiatives to bolster its market position and financial flexibility:

• Strategic Acquisitions: In August 2024, Flywire acquired Invoiced, a U.S.-based SaaS B2B company, to accelerate its global expansion in the B2B vertical. Additionally, in November 2023, Flywire acquired StudyLink, an Australian-based SaaS education company, to strengthen its position in the Australian higher education market.
• Capital Management: Flywire has been actively managing its capital through a share repurchase program and a public offering. In August 2024, the company announced a share repurchase program of up to $150 million, repurchasing 2,386,856 shares for $45.6 million by the end of 2024. Additionally, in August and September 2023, Flywire completed a public offering, raising $260.1 million in net proceeds. The company also entered into a new $125 million revolving credit facility in February 2024, replacing the previous $50 million facility, to enhance its financial flexibility.
• Future Outlook: Flywire plans to continue its strategic focus on expanding its client base and enhancing its product offerings through acquisitions and organic growth. The company aims to leverage its increased liquidity from the public offering and credit facility to support these initiatives. Flywire also intends to maintain its share repurchase program to manage its capital structure effectively. The company is committed to investing in technology and development to drive long-term growth and profitability, while also exploring opportunities for further international expansion.

Challenges and Risks

Flywire faces several significant risks that could impact its business operations and financial performance:

• Market Risks: The company operates in a highly competitive market with rapidly evolving industry standards, which may affect its ability to maintain or increase market share. Fluctuations in foreign currency exchange rates could materially and adversely affect cash flows and results of operations, especially given the company's significant cross-border payment volume. Economic and political instability, including geopolitical tensions and conflicts, could negatively impact global economic conditions and the company's operations.
• Operational Risks: The company has a history of operating losses and may not achieve or sustain profitability in the future, with significant investments required in technology, sales, and marketing. The company's ability to scale its business quickly enough to meet a growing client base is critical, and failure to do so could harm operating results. The restructuring plan announced in February 2025, which includes a workforce reduction, may not yield intended efficiencies and could negatively impact workforce morale and execution of strategic plans.
• Regulatory Risks: The company is subject to extensive regulations related to payments and financial services, including privacy, data protection, and anti-corruption laws, which could impact operations and increase compliance costs. Changes in payment card network fees or rules could harm the business, as could any failure to comply with regulatory requirements.
• Emerging Risks: The healthcare and education sectors, key markets for the company, are undergoing significant changes that could impact demand for the company's solutions. This includes regulatory changes affecting international student visas in Canada and Australia, which have already impacted revenue. The company's expansion into new verticals, such as B2B payments, carries risks due to limited experience and higher risk profiles associated with these payments.
• Management Strategies: The company is undertaking a comprehensive operational and business portfolio review to identify efficiencies and synergies, though the outcomes and benefits of these reviews are uncertain. Efforts to expand direct and channel sales capabilities and grow marketing reach are ongoing, with significant resources being invested to drive revenue growth.

SEC Filing: Flywire Corp [ FLYW ] - 10-K - Feb. 25, 2025