Euronet Worldwide ((EEFT)) has held its Q3 earnings call. Read on for the main highlights of the call.
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Euronet Worldwide’s recent earnings call painted a picture of resilience amidst challenging macroeconomic conditions. The company reported strong adjusted EPS growth and highlighted strategic advancements in partnerships and technology. However, revenue growth fell short of expectations due to external pressures, particularly affecting the Money Transfer and epay segments. Despite these hurdles, Euronet remains optimistic about future prospects, viewing current challenges as temporary and focusing on long-term growth opportunities.
Strong Adjusted EPS Growth
Euronet delivered a commendable 19% year-over-year growth in adjusted earnings per share, maintaining its trajectory of double-digit earnings growth. This performance underscores the company’s ability to navigate through economic headwinds while continuing to enhance shareholder value.
Merchant Services Business in Greece
The Merchant Services business in Greece was a standout performer, with operating income increasing by 33% year-over-year. This growth was driven by robust transaction volumes and continued expansion in the merchant base, reflecting the strength of Euronet’s operations in this region.
Ren and Dandelion Initiatives
Euronet’s strategic initiatives, including partnerships with Citibank for real-time cross-border payments and a strategic agreement with Fireblocks for blockchain integration, highlight significant advancements in technology and partnerships. These initiatives are expected to enhance Euronet’s competitive edge in the financial technology landscape.
Digital Money Transfer Growth
The digital money transfer segment showed impressive growth, with direct-to-consumer digital transactions increasing by 32% year-over-year. These transactions now account for 16% of total money transfer transactions, indicating a successful shift towards digital solutions.
Successful Convertible Bond Offering
Euronet successfully completed a $1 billion convertible bond offering at an attractive interest rate of 0.625%, maturing in 2030. This move enhances the company’s financial flexibility, providing additional resources to support strategic initiatives and growth opportunities.
Revenue Growth Below Expectations
Despite the positive developments, Euronet’s revenue growth fell below expectations due to macroeconomic challenges and changes in immigration policies that affected transaction volumes. This shortfall highlights the impact of external factors on the company’s financial performance.
Epay Segment Revenue Decline
The epay segment experienced a 5% decline in revenue compared to the previous year, primarily due to a shift within the wholesale mobile top-up business. This decline underscores the challenges faced in adapting to changing market dynamics.
Money Transfer Segment Challenges
The Money Transfer segment faced difficulties, with operating income and adjusted EBITDA decreasing by 2% and 1%, respectively. Remittances to Mexico declined by more than 12% year-over-year, reflecting the impact of restrictive immigration policies on transaction volumes.
Macroeconomic and Policy Challenges
Global economic uncertainty and restrictive immigration policies in the U.S. and other countries have posed significant challenges for Euronet. These factors have impacted revenue and transaction growth across all segments, highlighting the need for strategic adaptability.
Forward-Looking Guidance
Despite the challenges, Euronet remains optimistic about its future, projecting a 12% to 16% year-over-year earnings growth as previously forecasted. The company reported revenue of $1.1 billion, operating income of $195 million, and adjusted EBITDA of $245 million for the third quarter of 2025. Euronet’s ability to expand its operating margins by 40 basis points compared to the previous year demonstrates its resilience and strategic focus on long-term growth.
In conclusion, Euronet Worldwide’s earnings call highlighted a mix of resilience and challenges. While the company faced revenue growth shortfalls due to external pressures, its strong adjusted EPS growth and strategic advancements in technology and partnerships underscore its potential for future success. Euronet’s optimistic outlook and focus on long-term growth opportunities provide a positive narrative for investors and stakeholders alike.