Remitly (RELY) Q1 2026 Earnings Call Transcript

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DATE

Wednesday, May 6, 2026 at 5 p.m. ET

CALL PARTICIPANTS

• Chief Executive Officer — Sebastian Gunningham
• Chief Financial Officer — Vikas Mehta

TAKEAWAYS

• Revenue -- $453 million, increasing 25% year over year and surpassing the midpoint of guidance by $16 million.
• Adjusted EBITDA -- $102 million, $9 million above midpoint guidance, and above $100 million for the first time.
• Send Volume -- $22.1 billion, up 37% year over year.
• Spend Volume Per Active Customer -- Nearly $2,300, reflecting 14% year-over-year growth and record levels for both amount and growth rate.
• Quarterly Active Customers -- Over 9.6 million, growing 20% year over year and accelerating quarter over quarter.
• Take Rate -- 2.05%, consistent with expectations and primarily influenced by mix of high-value senders and business customers.
• Rest of World Revenue Growth -- 31% year over year; U.S. revenue grew 25% year over year.
• UAE Send Volume -- Rose more than 150% year over year during a period of heightened regional uncertainty.
• Growth Accelerators Revenue -- Revenue from products and segments outside Core Send more than doubled year over year.
• High-Value Sender Volume -- Increased 73% year over year, with this segment defined as transactions of $5,000 or more and now representing an additional 220 basis points of mix.
• Business Send Volume -- Grew more than 30% quarter over quarter, ending with over 20,000 Business users.
• Receiver Product Launch -- First transactions executed and wallets now enable users to hold USD or USDC and withdraw to local bank accounts, mobile wallets, or cash.
• AI-Driven Efficiency -- More than 250 headcount reductions, and over 50 roles redeployed through AI-enabled organizational streamlining year to date.
• RLTE (Revenue Less Transaction Expenses) -- $308 million, up 28% year over year, representing 68% of revenue, an improvement of 156 basis points.
• Transaction Expenses -- $145 million, or 32% of revenue; provision for transaction losses was $21 million (9.3 basis points of spend volume), both better than internal expectations.
• Marketing Expense -- $82 million, up 20.7% year over year; as a percentage of revenue, 18.2%, a 67 basis point year-over-year improvement.
• Payback Period -- Remained under 12 months, with lifetime value to customer acquisition cost near 6x.
• Technology and Development Expense -- $58 million, up 14% year over year but only 12.7% of revenue, benefiting from AI-driven development cycles.
• Stock-Based Compensation -- Down 23% year over year to 6.1% of revenue, aided by forfeitures from staff reductions.
• Share Repurchases -- $44 million spent, equivalent to 2.8 million shares; quarter over quarter outstanding shares declined for the first time in company history.
• Free Cash Flow -- Exceeded $70 million, supported by record operating results.
• Cash Balance -- Approximately $650 million at quarter-end.
• Q2 2026 Revenue Guidance -- $483 million to $485 million, 17%-18% year-over-year growth expected.
• Full-Year 2026 Revenue Guidance -- $1.96 billion to $1.975 billion, targeting 20%-21% growth and revenue acceleration in the second half.
• Adjusted EBITDA Margin Outlook -- Q2: around 18% (up 250 basis points year over year); full-year: approximately 19%, also a 250 basis point expansion.
• Share Buybacks as Capital Priority -- "Our top priority for free cash flow, after organic investment and customer prefunding requirements, remains the repurchase of shares."
• AI Integration -- AI implemented across operations, customer support, and product development, resulting in compressed product cycles, reduced costs, and enhanced localization.
• Core Send Product Development -- Expanded WhatsApp and ChatGPT integration, introduced support for new payment rails and bank partners in multiple countries, and improved global card acceptance and authorization rates.

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RISKS

• Provision for transaction losses remains subject to quarterly fluctuations, and "transaction loss rates may fluctuate quarter to quarter."
• Guidance indicates second-quarter growth may be affected by "shifting in timing of Ramadan and Easter," elevated US tax refunds in Q1, and "tougher comps."
• Stock-based compensation is expected to "increase in absolute terms year over year," with second-quarter stock-based compensation projected as elevated due to increased hiring and prior-period forfeitures.

SUMMARY

Remitly Global (RELY 0.04%) delivered all-time-high quarterly revenue, adjusted EBITDA, and net income as customer growth accelerated and digital adoption expanded, particularly in the United States and UAE corridors. Growth from high-value senders and the Business segment substantially outpaced internal expectations, prompting additional dedicated investments and organizational focus in these areas. AI implementation led to significant operational efficiencies and contributed to both workforce reductions and enhanced customer support automation. Product innovation advanced with expanded integrations, new instant payment rails, and the formal launch of receiver wallets and card-based financial offerings. Management issued raised full-year growth and margin guidance, explicitly signaling confidence in both top- and bottom-line trajectory and emphasizing continued scaling of share repurchases as a core capital allocation priority.

• The Business and high-value sender segments each achieved upward volume inflections, and near-term product pipeline was characterized as "overachieved all our plans so far."
• CEO Gunningham said, "We will rely on smaller teams to drive ownership and autonomy," outlining a refined operating approach separating core remittance from growth initiatives, and prioritizing speed and AI integration.
• Rest of world revenues are growing faster than US, with no single send corridor having disproportionate influence over company performance.
• Unit economics for new card-based "Send Now, Pay Later" borrow product are anticipated to benefit from fee, interchange, and float income, with loans funded by a partner bank and restricted to existing customers with established repayment history.
• Management emphasized the cultural advantage of its "missionary energy" workforce and predicted revenue scaling with a stable workforce base due to AI-driven productivity gains.

INDUSTRY GLOSSARY

• RLTE (Revenue Less Transaction Expenses): Net revenue after deducting transaction processing costs; a key measure of profitability in remittance platforms.
• QAU (Quarterly Active Users/Customers): Number of individual customers who have used the platform at least once during the quarter.
• High-Value Sender: Customer segment defined as those transacting $5,000 or more in a single remittance.
• Send Now, Pay Later: Short-term credit product for remittance senders, functioning on an invite-only basis for repeat users.
• Stablecoin: Cryptocurrency pegged to the value of a stable asset (e.g., USD), enabling faster and lower-cost cross-border payments.

Full Conference Call Transcript

David Beckel: Thank you for joining us for Remitly Global, Inc.’s first quarter 2026 earnings call. Joining me on the call today are Sebastian Gunningham, Chief Executive Officer of Remitly Global, Inc., and Vikas Mehta, Chief Financial Officer. Results and additional management commentary are available in the earnings release and presentation slides which can be found at ir.remitly.com. Please note that this call will be simultaneously webcast on the Investor Relations website. Before we start, I would like to remind you that we will be making forward-looking statements within the meaning of the federal securities laws, including, but not limited to, statements regarding Remitly Global, Inc.’s future financial results, and management’s expectations and plans.

These statements are neither promises nor guarantees and can involve risks and uncertainties that may cause actual results to vary materially from those presented here. You should not place undue reliance on any forward-looking statements. Please refer to the earnings release and SEC filings for more information regarding the risk factors that may affect results. Any forward-looking statements made in this conference call, including responses to your questions, are based on current expectations as of today, and Remitly Global, Inc. assumes no obligation to update or revise them whether as a result of new developments or otherwise, except as required by law. The following presentation contains non-GAAP financial measures.

We will reference non-GAAP operating expenses, adjusted EBITDA, and free cash flow on this call. For a reconciliation of non-GAAP financial measures to the most directly comparable GAAP metric, please see the earnings press release and the appendix to the earnings presentation which are available on the IR section of our website. Now I will turn the call over to Sebastian to begin.

Sebastian Gunningham: Thank you, everyone, for joining our first quarter 2026 earnings call. Q1 was another exceptional quarter for Remitly Global, Inc. We delivered record revenue and adjusted EBITDA, both above the high end of our guidance ranges and another quarter of record adjusted EBITDA margin and net income, and adjusted EBITDA exceeded $100 million for the first time. These results reflect three durable characteristics of our business. First, the resilient business model, which led to another quarter of share gains. Second, growing contribution from new businesses and categories. And third, continued expense and capital allocation discipline.

Each of these durable characteristics continue to compound, giving me great confidence in our ability to generate sustainable long-term growth in revenue, profits, and free cash flow. That confidence was reflected in nearly a fourfold increase in the pace of share repurchases this quarter. I want to use my time today to reflect on what I have learned in my first 90 days, discuss our evolving approach to delivering customer value through new products and offerings, and expand how we plan to use AI to drive growth and continued operating efficiencies. In my first 90 days as CEO, I have been very focused on gaining a deeper understanding of the business.

I traveled to a number of our global offices, spent time with teams on the ground, and conducted an internal deep dive spanning product, engineering, marketing, finance, and operations. I also spent time talking directly with our customers to understand firsthand what they value most about our product. It has been an intense 90 days. My goal was straightforward: understand what is working, what can work better, and learn as much as I can about the people and the culture that built this great company. I have also made some important people, product, and operational changes that are quickly helping accelerate the trajectory of the business.

From this period of listening and learning, a clear set of operating priorities has emerged. I have already begun putting them into action. We will rely on smaller teams to drive ownership and autonomy. We will distinguish clearly between our core remittance business and newer growth initiatives, allowing each to operate with the speed, focus, and rigor required by its stage of maturity. We will adopt a disciplined approach to building products, starting with customer needs and working backwards. We will embed AI across everything we do. And we have designed the company so that speed is the default. My time with employees and customers also reinforced the things I believed about Remitly Global, Inc. before joining.

First, the culture is genuinely distinctive. There is a missionary energy here and a sincere belief that moving money across borders should be reliable, fast, secure, and fair, especially for a community that has historically been overcharged and underserved. What sustains that culture is the caliber of the people who carry it. Across every function and every country I visited, I encountered talented, deeply committed individuals who bring real energy and care to this mission every day. That culture and those people are a real competitive asset, and I intend to protect and amplify both.

Second, our core strengths—trust, network breadth, and operating scale—put us in a strong position to continue gaining share and growing our offerings to better serve the cross-border needs of our customers. My conversations with customers reinforce that trust is the most consequential of these strengths. These are people sending money for life-changing events, supporting family members, covering medical bills, building a future from a distance. For them, knowing the money will arrive reliably, quickly, and fairly is paramount. And if things do go wrong, it is important that they know there is an instant 24x7 global structure in place to fix it. As financial services become increasingly automated and digitized, trust becomes more valuable, not less.

Our disbursement network, customer support excellence, and compliance capabilities create a trust and safety advantage—a durable, hard-to-replicate edge that protects our customers in every corner of the world and strengthens our global platform. Third, I believe AI and stablecoins will accelerate our growth and not just increment it. Companies like Remitly Global, Inc. with trusted customer relationships, complex regulatory dependencies, and a proprietary network will be great beneficiaries of AI tailwinds. The company now knows I am somewhat obsessed with applying this newly found intelligence into our business. As I will explain, we are moving quickly to ensure we take full advantage of AI to move faster, lower costs, improve product quality, and compress product development timelines.

Stablecoins are a different kind of opportunity—not a universal solution, but a targeted one—encouraging us where they offer a clear cost or speed advantage. Stablecoins give us another tool to reduce FX costs, improve settlement speed and efficiency, and deliver better outcomes for our customers. With that as context, let me turn to how I am thinking about the opportunity ahead and why I believe we are only beginning to scratch the surface. When I joined Remitly Global, Inc., I was asked whether I planned to change our strategy as the new CEO. The answer is no. The vision, the customers we serve, and the focus on cost, speed of delivery, and trust are right, and they will not change.

Where I differ is the pace with which we can achieve our vision and execute our strategy. I have full confidence Remitly Global, Inc. will be a larger, more diverse provider of cross-border financial services, and the most important app for those that send or receive money internationally. To explain why, let me share a framework I have used internally. I think about our opportunities as a four-by-four matrix: four customer categories on one axis and the four primary ways we deliver value to those customers on the other.

The four categories are: one, our core senders—our established base who send money for critical nondiscretionary reasons; two, high-value senders—a fast-growing category with significant untapped share for Remitly Global, Inc.; three, businesses—a massive and underserved category for which we are seeing rapid traction even with a very early feature set; and four, receivers—the 30+ million people around the world who receive money from Remitly Global, Inc., most of whom are not senders today. For each of these customers, we are grouping four categories of product offering, broadly defined around sending money, borrowing money, spending money, and saving money.

At the intersection of the four customer and product categories are many unique opportunities to serve our customers with products they need to live their cross-border financial lives. Each customer category and product offering reinforces the others, drawing on shared infrastructure and data to create compounding benefits as we scale. Core Send comprises the vast majority of our revenue today and is the base from which all our offerings are built, leveraging 14 years of experience, network depth, and an optimized cost structure, as well as a DNA of trust and speed that is difficult to replicate. Everything outside of Core Send we think of as growth accelerators.

Our borrow, spend, and save products fuel the flywheel around sending money by addressing a broad set of cross-border financial needs. A more complete financial services experience, in turn, drives improved loyalty, higher remittance volumes, and diversifies our revenue sources. This framework is not a change, but a refinement of the strategy we presented at Investor Day. It provides a blueprint for execution and a disciplined lens for prioritization. We will go deep where the opportunity is largest and where we have the clearest right to win. And when I look at where we stand today, we have honestly only just started addressing a handful of these opportunities.

I will provide a brief update on recent progress and initiatives across each of our key near-term opportunities, starting with Core Send. In Core Send, we improved our distribution to new users, expanded integration with WhatsApp and ChatGPT, and deepened our network reach across every region we serve, improving reliability, speed, and access for customers around the world. On the receive side in Latin America, we integrated Brazil’s and Colombia’s central-bank-backed instant payment rails and added Banco Bolivariano as a direct bank partner in Ecuador. In Asia, we added KBZPay in Myanmar, Rocket in Bangladesh, and Coins.ph in the Philippines, extending our reach to tens of millions of users with near-instant fiat and stablecoin wallet-based payouts.

In Africa and the Middle East, we launched new receive markets, including the UAE, bringing total receive countries to 170. On the send side, we enabled Discover card acceptance and launched access to FedNow and RTP in the US, allowing customers to fund transactions instantly from bank accounts while lowering our cost. Underpinning all of this, continued innovation in our payments and fraud systems brokered higher card acceptance and authorization rates globally in Q1, reinforcing network strength while improving speed, reliability, and the experience. In the near term, we are focused on using AI to deliver real-time automated pricing across our 5,000+ corridors, enabling regional leaders to capture incremental demand by delivering more customer value.

We will also apply AI across the Remitly Global, Inc. experience to improve the moments that matter most to customers: how long a transfer takes to arrive, how they pay, and how we keep them coming back. And we will accelerate the pace of geographic expansion, bringing our leading digital remittance experience to some of the largest, fastest-growing send and receive countries in the world. This quarter, we updated our definition of high-value senders to include only those who send $5,000 or more in a single transaction, which better aligns our strategy, focus, and resources with the specific needs of those who send higher transaction amounts. This customer needs a high-touch, certainty-first experience.

And when we earn that trust, they generate substantially more value per customer than our core senders. In Q1, we continued to remove friction and improve the experience for these customers by increasing send limits with network partners and simplifying the onboarding experience. Our near-term focus for this category is to streamline pay-in methods and improve our risk assessment process while better targeting and addressing the specific and diverse needs of customers within this category. Our business offering continues to scale, growing volumes 30% quarter over quarter ahead of expectations.

In Q1, we launched our business receiver product in five new countries, allowing freelancers and contractors in parts of Latin America and Asia to request and receive payments from clients in 26 countries around the world. We also launched a new feature that allows businesses to initiate the payment process by sending a link to the recipient’s email or phone, eliminating cumbersome data management and trust issues that often cause friction for small businesses. Our near-term focus for our business offering is continued improvements to the onboarding experience, geographic expansion, and a steady drumbeat of features that appeal uniquely to small and medium-sized businesses sending money internationally.

Our receiver strategy targets the more than 100 million people in the world who receive money in one currency and spend in another. Last month, we recorded our first receiver transaction following the launch of our receiver and request product in six countries, creating a new source of cross-border volume in countries where we already have a strong send presence. With this launch, we also introduced a wallet that enables receivers to hold funds in USD or USDC stablecoins and withdraw to local bank accounts, mobile wallets, or cash pickup locations. Our near-term focus for receivers is country expansion and enabling widespread access to stablecoins across our wallet offerings.

Moving to borrow, spend, and save, last year we announced a range of products aimed at supporting these use cases: Send Now, Pay Later for our customers’ liquidity needs, and wallet and card for sending, spending, and saving money with us. We have seen strong traction with these offerings as we continue to build, test, and iterate, with revenue more than doubling year over year. Building on these learnings and experience, this quarter, we will expand our offering for customers who have a need to send now, pay later, spend, and save.

For a low monthly fee plan, these customers will receive access to a global debit card to spend, a wallet to save, a short-term line of credit offered by a bank partner for remittances, and benefits that reward loyalty, remittance use, and the timely payment of credit balances. We believe there is a strong preference among customers with short-term liquidity needs for a card-based experience; loyalty and rewards are a central feature. This will be the first of our Remitly Global, Inc. card offerings that target specific use cases, addressing the unique needs of a broad cross-section of our customers.

We have a long list of ideas for our card platform beyond Send Now, Pay Later that we plan to execute over the coming quarters. Our goal is to make the Remitly Global, Inc. card the most versatile and best debit card in the world for the 300 million international migrants and 80+ million small businesses worldwide. Our strategy is simple: expand the value and capabilities we deliver to the broad range of people and businesses sending money globally. Investors should expect a meaningful acceleration in the pace of product enhancement as we expand our offerings, guided by the operating principles we have put in place around clear ownership, distributed accountability, and a bias for speed.

Finally, I want to touch on the benefits we expect to derive from AI. Over the past several months, many of our peers have seen AI-driven gains in productivity and cost efficiencies. The pace of AI advancement is real, and the impact is substantial. Remitly Global, Inc. is fully part of the shift, and I will lead that effort aggressively. We have organized our thinking around three types of AI benefits. The first is the cost benefit, which drives greater operating efficiency and long-term cost savings. We have gone methodically through the organization, function by function, to identify where we could use AI going forward to drive efficiency gains while maintaining or improving productivity.

Through this process, we have identified opportunities to streamline our organization, building on the more than 250 headcount reductions and over 50 roles redeployed through efficiency gains year to date. That is a deliberate choice grounded in our confidence that AI can allow us to do the same work—and in most cases, more work—with a leaner organization. The second benefit of AI is speed, which helps unlock a faster operating cycle. Throughout our product and engineering teams, a new profile of skill set is emerging that combines product design, engineering depth, and AI fluency in one person.

We are calling them knowledge development engineers, and they are helping us disrupt the decades-long bottlenecks of product ideation, building, testing, and launching from months and years to days. I would note that eliminating one bottleneck quickly reveals the next. So as a company, we are actively rethinking every step in the process to deliver products that move seamlessly from idea to customer value to deliver exceptional products and services. The speed benefit is harder to quantify than the cost benefit, but we believe its potential compounding effect on our ability to build, ship, and iterate will be an enormous structural tailwind. The third and most consequential benefit of AI in the long run is the trust benefit.

For our customers, trust means safety and comfort, speed, and fair pricing, and a high-quality person to talk to when things go wrong. AI can improve our ability to deliver on all three. Take localization at scale. With AI giving us a broader and deeper understanding of our customers, we can now tailor the experience across every corridor with a level of personalization that was not previously possible. That relevance builds trust, and trust underpins everything we do. Three to four years from now, I believe this company will generate significantly more revenue with roughly the same number of people.

The AI benefits are how I believe we will generate investment capacity to get there, and we intend to put a large portion of that capacity back into growth. Let me close with this. Q1 was an exceptional start to the year—record results above guidance and a business that continues to demonstrate its resilience and its upside. But what energizes me most is not what is behind us. It is what lies ahead. We have a core business that is growing and improving. We have a strong portfolio of growth accelerators that are at the very early stages of what they can become. The early benefits of AI are beginning to create real, measurable capacity for investment.

And we have a team and a culture I believe is among the most mission-driven I have encountered in my career. I want to thank every member of the Remitly Global, Inc. team. The execution, the energy, and the commitment to our customers that shows up every day are what make these results possible. And I want to thank our investors for their continued confidence and trust in this company. With that, I will turn the call over to Vikas.

Vikas Mehta: Thank you, Sebastian, and good afternoon, everyone. We delivered another quarter of profitable growth and strong free cash flow, reflecting continued share gains and solid execution. First-quarter revenue was $453 million, up 25% year over year and $16 million above the midpoint of our guidance. Revenue outperformance this quarter was driven by a number of factors. Recent regulatory changes in the United States drove an increase in customers’ use of digital remittances, resulting in record new customer acquisitions. We also benefited from elevated demand associated with higher tax refunds in the US and favorable market conditions in key corridors. Adjusted EBITDA was $102 million, $9 million above the midpoint of our guidance.

Adjusted EBITDA outperformance was driven by higher-than-expected revenue, lower-than-expected transaction losses, and a short-term pause in hiring following in-quarter headcount reductions. Now let me share an overview of our first-quarter results and then provide our outlook for 2026 and our updated guidance for the full year. Unpacking revenue growth drivers for Q1, send volume grew 37% to $22.1 billion. Supporting this strong volume growth, spend volume per active customer increased to nearly $2,300, or 14% year-over-year growth—a record on both an absolute and percentage growth basis. This was driven by growth in both transactions per active customer and record growth in average transaction size as we continue to win share and gain traction with high-value senders and business customers.

Quarterly active customers grew 20% year over year to over 9.6 million, ahead of our expectations. QAU growth accelerated quarter over quarter, reflecting the shift in offline-to-online conversions associated with recent regulatory changes in the United States. Our Skip the Line campaign, highlighting the lower cost and convenience of digital remittances, has been effective in attracting new customers seeking alternatives to traditional cash-based remittance methods. QAU growth was further supported by improved retention, reflecting enhancements in the core product to improve speed, reliability, and overall customer experience. As expected, volume and revenue exceeded QAU growth, as we saw a greater mix of send volume from high-value senders and businesses. Our take rate this quarter was 2.05%, in line with expectations.

The year-over-year change was driven primarily by growth in volume from high-value senders and business customers, as well as a higher digital payout mix, which improved by more than 250 basis points year over year. As I have discussed in previous quarters, take rate is heavily influenced by mix, so it is not a great metric for analyzing our underlying business performance. We believe our LTV dollar growth and RLTE per active user are more indicative of our success than take rate when analyzing our performance. Now let me dive deeper into our revenue performance from a geographic and new products perspective. From a send perspective, US revenue grew 25%, driven by continued share gains.

Rest of world grew 31% year over year, showcasing the geographic diversification of our business. Our broad footprint means no single corridor disproportionately dictates our outcomes. Notable highlights from the rest of world this quarter include continued strength in the UAE, where we saw meaningful increase in activity. Send volumes in the UAE rose over 150% year over year, due in part to a short-term surge in volumes during a period of heightened regional uncertainty. On the receive side, revenue from transactions to regions outside of India, the Philippines, and Mexico grew faster than overall revenue growth and now comprise over half of our revenue mix, further diversifying our business.

I will now move to discuss the performance of our growth accelerators. As a reminder, growth accelerators include all customer categories and offerings outside of Core Send. As Sebastian shared earlier, this quarter we are simplifying our structure for defining customers based on average transaction size. High-value senders are now those who send a transaction of $5,000 or more. This change reflects a refined focus on customers whose needs are specific to larger transaction amounts. In Q1, high-value sender volume grew 73% year over year, reflecting a 220 basis point year-over-year increase in mix.

We continue to see outsized growth from high-value senders as we improve the customer experience and expand and refine our targeting of this customer category, and we will continue to build on this momentum with product enhancements that further reduce friction and cater to the specific needs of these senders. Remitly Global, Inc. Business continues to scale ahead of expectations. We ended Q1 with over 20,000 Business users and more than 30% quarter-over-quarter growth in business send volume. Send volume and RLTE contribution for Business customers were more than 2x higher than our core during the quarter.

We launched our receiver product this quarter, enabling direct access to the more than 30 million individuals and businesses who receive funds today from Remitly Global, Inc. senders but are not yet themselves Remitly Global, Inc. customers. While nascent, we are very optimistic about this new offering. Now moving to borrow, spend, and save initiatives. Revenue from these offerings more than doubled in Q1. This quarter, we are expanding our Send Now, Pay Later offering to a comprehensive and simpler card-based experience for customers who have a need to send now, pay later, spend, and save.

This evolved offering will provide customers with a global debit card, a wallet, a short-term credit line for remittances funded by a banking partner, and rewards for timely payments—all for a low monthly plan fee. As with prior Send Now, Pay Later offerings, the product will be made available only to existing Remitly Global, Inc. customers with demonstrated repayment behavior. Unit economics for this product are expected to be strong, as it will generate plan and interchange fees and float income. The short-term loans will be issued by a bank partner, and the lines of credit tend to perform better than nonrecourse advances.

Moving forward, we expect the majority of growth in our Send Now, Pay Later borrowing solution to come from this card-based format. We continue to expect revenues from new products, as we previously defined, to more than double this year. High-value senders are expected to be additive to prior expected growth ranges associated with new products. Now, including high-value senders, revenue from all growth accelerators is expected to be around 5% of total revenue in 2026 and exceed 10% of total revenue by 2028. These growth accelerators address customer needs that are adjacent to Core Send, providing an efficient means of diversifying our business revenue base while driving cost synergies from the shared use of our technology.

Turning to our focus on driving profitable growth. As I noted earlier, revenue less transaction expenses, or RLTE, is a useful indicator of our business model’s long-term success. RLTE dollars grew 28% to $308 million, outpacing revenue growth and reflecting strong customer activity, improved partner economics, routing optimization, and economies of scale. RLTE as a percentage of revenue this quarter was 68%, improving 156 basis points year over year. We remain focused on long-term RLTE dollar growth as we continue to attract new customers, innovate with new products, and scale. Transaction expenses this quarter were $145 million, and as a percentage of revenue were 32%.

Excluding provisions for transaction losses, other transaction expenses were $124 million, improving 114 basis points year over year as a percentage of revenue and reflecting improved network economics. Provision for transaction losses was $21 million, or 9.3 basis points as a percentage of spend volume, better than our expectations as we continue to benefit from efficiencies afforded by the AI-driven fraud prevention and detection model deployed late last year. With that, let me walk you through the specific non-GAAP expense categories. Notably, we delivered leverage across all expense categories once again in Q1.

In Q1, we reduced our corporate workforce by more than 10% as part of a broader effort to sharpen our organizational focus and drive efficiencies across the business. These were not easy decisions but were necessary to ensure we continue driving operating efficiencies as we scale our growth accelerators. Marketing investments remain disciplined and growth-focused. We spent $82 million on marketing in Q1, up 20.7% year over year. As a percentage of revenue, marketing expense was 18.2%, improving more than 67 basis points year over year due to continued efficiencies. Marketing spend per active customer was $8.56, up 0.7% year over year, in line with our expectations.

This quarter, we launched a Skip the Line campaign, a strategic initiative targeting offline senders in the US who historically relied on in-person cash agents to send money to Latin America. By meeting these customers where they already are—whether on WhatsApp or on billboards in their neighborhoods—we were able to drive meaningful growth in new customer acquisition from a category that is difficult to reach. Campaign results across our targets show strong lift in familiarity, awareness, consideration, and intent to try. Our lifetime value to customer acquisition cost ratio was about 6x, while our payback period remained under 12 months. Continued efficiencies reflect growth in customer acquisition through unpaid channels and word of mouth.

As a reminder, our marketing investments drive returns for many years beyond our initial investment given our growing base of repeat users. Customer support and operations expense was $25 million, and as a percentage of revenue was 5.5%, improving 69 basis points year over year and continuing a multiyear trend of steady operating leverage. Today, over 97% of transactions are completed without any agent contact—a remarkable milestone that reflects both the reliability of our service and the sophistication of our AI-driven support capabilities. When customers do need help, our AI-based assistants are meaningfully reducing the need for human intervention, and early customer satisfaction scores tell an encouraging story, with AI-led interactions performing as well as human-agent interactions.

Technology and development expense was $58 million, and as a percentage of revenue was 12.7%, improving by 127 basis points year over year. Technology and development expenses grew 14% year over year, meaningfully below the pace of our revenue growth. We are beginning to see the benefits from embedding agentic AI deeply into our engineering and product development teams. Our engineers are using AI-assisted code generation and automated testing to compress development cycles, ship faster, and reduce the cost per feature delivered. We are still in the early innings and expect AI to be a durable contributor to technology-related operating leverage going forward.

G&A expense was $41 million, growing only 2% year over year—our lowest growth rate ever as a public company. We delivered significant leverage—209 basis points as a percentage of revenue year over year—reflecting deliberate and disciplined attention to our cost structure. In total, expense efficiencies this quarter reflect both the benefits of operating leverage and a pause in hiring as we optimize our organization to better enable Sebastian’s operating principles. Moving forward, we expect AI benefits to contribute significantly to the funding of our growth accelerators. Strong revenue growth combined with efficiency and discipline led to adjusted EBITDA of $102 million.

We also delivered $49 million of GAAP net income, more than 300% growth compared to $11 million of net income in 2025. As we noted at Investor Day, our North Star is driving free cash flow growth while managing dilution, and Q1 demonstrated continued progress on both fronts. Free cash flow grew to over $70 million in Q1. The difference between adjusted EBITDA and free cash flow is driven by working capital, capital expenditures, and restructuring payments. Outstanding shares were 210 million, down quarter over quarter for the first time in our company’s history, reflecting our disciplined approach to dilution management, including an elevated pace of share repurchase activity.

Stock-based compensation was down 23% year over year, coming in at 6.1% of revenue—approximately 382 basis points lower than 2025. This benefit was partially aided by forfeitures associated with headcount reductions in Q1. For all of 2026, we expect stock-based compensation to increase in absolute terms year over year but decrease as a percentage of revenue, as grants associated with recent leadership changes are partially offset by higher forfeitures. Q2 stock-based compensation will be elevated, reflecting both hiring activity that shifted out of Q1 and challenging year-over-year comparisons, as forfeitures in the prior year were concentrated.

We were meaningfully more active in repurchasing shares in Q1, opportunistically buying back $44 million, or 2.8 million shares—nearly double the shares we repurchased since launching the program in the second half of last year. This reflects conviction in our long-term growth opportunities and a view that share repurchases are an attractive use of capital. We will continue to be disciplined and opportunistic in how we deploy capital towards buybacks. We ended the quarter with around $650 million of cash. As a reminder, cash in excess of liquidity requirements is a strategic asset in scaled global money movement businesses like ours.

This quarter, cash on hand, along with our revolving credit facility, were optimally used to fund customer transactions and satisfy regulatory safeguarding requirements across thousands of corridors and regulatory jurisdictions. Our top priority for free cash flow, after organic investment and customer prefunding requirements, remains the repurchase of shares. With that, I will move to our outlook. For Q2 2026, we expect revenue of $483 to $485 million, or 17% to 18% growth. Second-quarter growth reflects the shifting in timing of Ramadan and Easter to earlier in the year, elevated US tax refunds benefiting send volumes in Q1, an increase in volumes late in Q1 associated with geopolitical events, and tougher comps.

We continue to see strong momentum in our core, and we expect a continued shift towards digital remittances, share gains, and the scaling of our growth accelerators to contribute to total company revenue growth of around 20% in the second half of the year—an increase relative to prior expectations. Breaking down our revenue growth expectations, in Q2 we anticipate send volume growth to exceed revenue growth, and revenue growth to be in line with quarterly active customer growth. Send volume per active customer is expected to grow in the mid- to high-single-digit range, supported by a shift in mix toward high-value senders and businesses.

For the full year, we expect revenue between $1.96 and $1.975 billion, reflecting a growth rate of 20% to 21%. As noted, we expect growth to accelerate in the second half of the year, reflecting strong demand in our core and additional contributions from our growth accelerators. Now let us pivot to profitability and expense guidance. Starting with RLTE, we expect Q2 RLTE margins to be modestly higher year over year, driven primarily by normalization of transaction losses. As a reminder, Q2 of last year was impacted by an outsized transaction loss stemming from a sophisticated fraud attack in May. For the full year, we expect RLTE margins to be broadly in line with 2025 on a normalized basis.

As always, transaction loss rates may fluctuate quarter to quarter, and we remain disciplined about optimizing customer lifetime value while rigorously managing risks across our platform. Shifting to marketing, we expect continued marketing efficiencies in 2026 as we prioritize high-ROI marketing opportunities. For Q2, we expect marketing spend per QAU to be slightly higher year over year as we engage customers around the timing of the World Cup, expand our Skip the Line campaign to select countries, and launch brand marketing in the UAE. Putting this all together, we expect Q2 adjusted EBITDA to be between $86 and $88 million, translating to an adjusted EBITDA margin around 18%, an expansion of around 250 basis points year over year.

For the full year, we expect adjusted EBITDA to be between $370 and $385 million, representing an adjusted EBITDA margin of around 19%, also an expansion of around 250 basis points year over year. This improved EBITDA outlook reflects a more favorable outlook for revenue and our commitment and ability to balance growth and profitability, leveraging the benefits of AI, while we continue to invest in driving top-line growth. Our outlook also assumes normal levels of transaction losses for the remainder of the year. We expect to generate positive GAAP net income each quarter this year and strong year-over-year growth in GAAP net income and free cash flows.

To summarize, in Q1 we delivered another quarter of exceptional results across our key financial metrics, achieving 25% revenue growth and 22% adjusted EBITDA margins. We also delivered record GAAP profitability and strong free cash flow, underscoring the power and scalability of our business model. With that, Sebastian and I will open up the call for your questions. Operator?

David Beckel: Thank you.

Operator: Thank you. At this time, we will conduct the question-and-answer session. As a reminder, to ask a question, you will need to press *11 on your telephone and wait for your name to be announced. To withdraw your question, please press *11 again. In order to accommodate as many individuals as possible during the Q&A portion, each caller will be permitted to ask one question only with no follow-up. Please stand by while we compile the Q&A roster. Our first question comes from the line of Tien-Tsin Huang with JPMorgan. Your line is live.

Tien-Tsin Huang: Hi. Thanks a lot. Nice results here. I want to, if you do not mind, because I know you went through this in the guidance, but maybe can you drill down a little bit more into the upside factors in the quarter, the thinking for the second quarter and the balance of the year. There are a lot of moving pieces with the tax refunds being higher and the remittance tax, and you talked about some of the geopolitical, the favorable market conditions and whatnot. So how does this impact your thinking on seasonal trending for the second quarter and second half?

What new risk might there be here versus upside opportunity that may have been different than, say, 90 days ago?

Vikas Mehta: Tien-Tsin, first of all, thank you for the question, and as I shared on the call, Q1 was an exceptional quarter—really strong highlights across the board, all the way from record new customer acquisition to record send per quarterly active users. Some of the highlights in the quarter included the positive impact that we got from the remittance tax and the shift from offline to online customers that aided our record new customer acquisitions. In addition to that, the higher US tax refunds—as we have seen, especially in the core sender segment—were a really positive impact. Again, a lot of it is art and science, but clearly there was some correlation there, especially in the late March timeframe.

Beyond that, as we highlighted, holiday timing—both Easter as well as Ramadan—moved up a couple of weeks earlier in the year, which gave us a positive overall Q1 shape. Finally, as we noted, the global uncertainty with regards to geopolitics, especially in the Middle East corridors, created an upside on UAE volumes, which grew north of 150%. So overall, a really strong quarter. And as you know, Q1 becomes the foundation for the full year, and with the record new customer acquisition, that creates a nice follow-through in out quarters.

As we highlighted, the full-year guidance is north of 20%, which means that in the second half of the year, there is a reacceleration that happens, driven by both the strength in our core business as well as propelled by the growth accelerators Sebastian talked about. Overall, we remain very confident as we start the year, and the overall business model that we have—which drives predictability, resilience, as well as diversification—gives us more and more confidence.

Operator: One moment for our next question.

Operator: Our next question comes from the line of Ramsey Clark El-Assal with Cantor Fitzgerald. Your line is open.

Ramsey Clark El-Assal: I wanted to ask about your M&A. It seems like in the last several quarters, the kind of growth factors in your business have just exploded, just in terms of product proliferation and monetizable surfaces. Is that changing the way you are looking at M&A to, you know, if there are so many more opportunities to sort of accelerate these different growth paths through M&A? And then also, if you could just clarify one point because on Tien-Tsin’s last question, how should we think about that 1% cash remittance tax impact, which has been positive, trending through the rest of the year?

Is it something that you guys are counting on, or is it something that you are seeing now or you are not sure you will continue to see? Just a finer point on that too. Thank you.

Sebastian Gunningham: Yes. Let me take the acquisition question. Clearly, as we see all the growth in these new customer categories—the high-value senders, the business senders, and the receivers—we are starting to analyze acquisitions a little bit differently. As you know, we have not been a very acquisitive company, but we are starting the process to understand what it means to have this kind of growth in these categories and where we can accelerate that.

On the core business, as of right now, I do not see anything obvious on the horizon, but we are building up the muscle to learn how to do this, and I anticipate that in the future, we will probably be able to answer this question more specifically. On the 1% cash remittance tax, we do not have any science behind the 1%. We have a lot of anecdotes, and we saw this in Q1. I suspect it is probably going to continue for the remainder of the year. It is hard to tell whether we captured a lot of it now or a lot of it is coming.

There still is a fairly large group of people that transact in cash. I think it is inevitable that this will continue. Maybe it will take a couple of years. Maybe it will take the remainder of this year. But as I said, we take it as an article of faith that it is one of the tailwinds to our business, and we expect it to continue for the rest of the year.

Vikas Mehta: And just to add a point or two to Sebastian’s thoughts, we will continue to invest in the Skip the Line campaign. We have seen a lot of success coming through that. And secondly, on the product enhancements, we want to meet customers where they are. As we shared earlier in the quarter, we came out with enhancements to WhatsApp, and we launched a ChatGPT integration. So we feel that by creating strong product enhancements, we can continue to drive the offline-to-online shift.

Operator: One moment for our next question.

Operator: Our next question comes from the line of Darrin Peller with Wolfe Research.

Darrin Peller: Alright. Hey, guys. Thanks. Look, I want to back out—if we take out of the equation the, you know, let us call it the remittance tax, the Mideast impact, or even tax refunds—just anything that might be shorter term and not a business model opportunity for you guys. When I think of the sustainable drivers of upside—the growth accelerators, effectively—help us understand where they came in versus your prior expectations. I mean, if you looked at high-value senders or business or receivers or even some of the borrow, spend, and save areas, I am curious to know where they are trending versus what you initially thought.

And then maybe a little more on go-to-market around high-value senders and business, just because it seems like such a great—I mean, it is really contributing to the volume growth rate. And I know it is an area of real focus for you guys. So I am curious where you see that going from here in terms of your ability to invest in it and ensure that it stays a key contributor.

Sebastian Gunningham: I will make the comment that, first of all, these are not segments that we invented. As we looked at all the data and we looked at the customers coming to Remitly Global, Inc., we started to see this high-value cohort. We put in that it is greater than $5,000 transactions—$10,000, $50,000. Customers were finding us and starting to use the platform. We have a lot of ideas to make the product that much better. Without much investment, we are seeing a lot of growth in this area, and it has overachieved all our plans so far. As of right now, we have now dedicated a full team.

We have a full engineering team, and we are launching new features for that customer daily at this point. The Business—the same thing happened. We started to see small businesses using the Remitly Global, Inc. infrastructure. If you are a small business in the US, it is very painful to move money across the world. That business continues to overachieve our plans. We have now dedicated a team. We have a full engineering team. We have a different go-to-market model. We have more partnerships. We are seeing week-to-week improvements. And as you know, that is a very large market. You do not need to win that much to make it a pretty big business.

I was in Manila last week, and I was talking to a group of freelancers, and this is a very active group of people who are requesting to be paid from the US—virtual assistants, virtual salespeople. This is happening all over the world. So we see a lot of traction there. And then the final category is a little bit more unknown. That is the 30 million customers around the world who receive money from Remitly Global, Inc. We have launched our first set of products. It is very early days. That is not contributing much yet. We think it is a big opportunity, but we have to navigate our way through that and see what the right products are.

So, overachievement in high-value senders and we are doubling down on that. Overachievement on the Business side, and we are doubling down on that. And on the receiver side, it seems a very exciting market—TBD.

Operator: One moment for our next question.

Operator: Our next question comes from the line of Cristopher David Kennedy with William Blair. Your line is open.

Cristopher David Kennedy: Good afternoon. Thanks for taking the question. Just wanted to follow up on the Remitly Global, Inc. Business initiative. Clearly, it is outperforming your expectations. But is there any way to frame how that business is ramping relative to the high-value send initiative that was launched maybe 18 months ago? Thanks for taking the question.

Sebastian Gunningham: From a product perspective, the high-value sender is an extension of our core sender market. If you look at the product needs of that sender, it is a close cousin to all the needs of the core sender. The Business sender is different and has different requirements. They need bulk send. They need different integrations to their ERPs and payment systems. It is a bit of a different customer. So it is a little bit of an unfair comparison because the go-to-market is going to be different. We have seen the overachievement without much go-to-market investment yet.

If you were to look at the numbers, it is probably a pretty similar ramp of growth between the high-value senders and the Business senders, but with quite different requirements as to what we need to do to continue to accelerate that growth.

Operator: One moment for our next question. Our next question comes from the line of Aditya Buddhavarapu. Your line is open.

Aditya Buddhavarapu: Hey, Sebastian. Thanks for taking my question. Can you just give an update on the rollout of the wallet and then card? The US was a close first market, but any update on maybe the rollout into other markets during 2026? And, also, maybe somewhat related to that, the first time shifting focus to the card as the main channel for the Send Now, Pay Later product—what did you see which made you think that was the right route?

Sebastian Gunningham: First, I will start by noting that for the last year, we have been experimenting with this Send Now, Pay Later idea, which is a short-term liquidity loan, and we had a very strong signal. We think this is a killer idea. Customers have told us that the use of a card is extremely valuable, so we are wrapping up a number of ideas under this card construct, which will help the economics and allow us to really simplify how we go to market with this. Remember that Send Now, Pay Later is invite-only. The customer has already sent once on Remitly Global, Inc.; we know some things. We think it is a very interesting product.

The signals from all the testing over the last year are very good, and we see that launch as having quite a lot of potential. We have a long list of things we are going to add to a card to make customers use it—loyalty and rewards; you can imagine all the things that we can add to a card. It is US-focused first. We are doing it with a bank partnership. But our ambition is to make this global. As of right now, we are going to go for the next few quarters with a US launch.

Operator: One moment for our next question. Our next question comes from the line of Zachary G. Gunn, on for David Michael Scharf, with Citizens Capital Markets. Your line is live.

Zachary G. Gunn: Hi. This is Zach on for David. Thanks for taking our questions, and congratulations on another strong quarter. I wanted to dig in a little bit on the mix with the high-value senders. As it is ramping up, it sounds like over 10% of revenue by 2028. I want to see if there is any commentary to highlight in terms of how that shift will impact any geographic mix or concentration, and any expectations for loss rates versus the core senders book.

Vikas Mehta: Thank you for the question. As we highlighted, we are very excited about the high-value senders customer category. This used to be part of our Core Send, but we are increasing our focus—putting a dedicated organizational structure and muscle behind it, putting a product thought process as well as marketing focus around it—and as we do that, the potential is massive. We are super excited for the potential here. Even as we do that, in parallel we are seeing very strong performance. As you saw this quarter, the high-value senders volume grew 73%.

As we look at product enhancements like increasing our send limits, we feel that the volume, especially in the $10,000+, $25,000+, and $50,000+ bands, represents really big greenfield opportunities for us where we can start attracting more and more customers. Even our marketing message, which today is more generic—as we try to make it more targeted and focused towards these customers, we feel awareness as well as the overall service that we provide should resonate really well. The availability is across the globe, same as our Core Send availability. From a mix and targeting perspective, we believe that it should be a global adoption and global growth, and that makes it even more exciting for us.

On loss rates, we continue to rigorously manage risk. While mix can influence loss dynamics, our risk assessment enhancements for this segment are designed to maintain attractive loss performance relative to our core.

Operator: One moment for our next question. And thank you. We have time for one final question. Our next question and final question comes from the line of Analyst with KeyBanc Capital Markets. Your line is live.

Analyst: Hi. This is Zoe on behalf of Alex McGrath. Thank you for taking my question. I was wondering if you could provide more context on the ChatGPT integration—any financial consideration in it? And also, a question on WhatsApp expansion. How should we assume Remitly Global, Inc. expands on this? Obviously, there is more geo coverage, but since there is also an opportunity on the receipts partnership as well. Thank you.

Sebastian Gunningham: Thank you. Good question. There is no financial interchange with ChatGPT. These are early days. We are clearly entering a time where customers are probably going to interface with all their financial services with different UIs—whether WhatsApp and WeChat or ChatGPT and, more broadly, LLMs and chats and eventually agents. We have a lot of experiments going on. We have announced WhatsApp integration, which allows customers to interact directly with Remitly Global, Inc. through WhatsApp. ChatGPT is an early experiment. We see some use there, and it is growing day by day. I follow that every day.

We have a long list of ideas to make sure that all the Remitly Global, Inc. infrastructure—and all the benefits of our cost efficiencies, speed, and service behind moving money—is available and relevant if these evolutions in how people interface with money movement continue. So, early days, good signal so far, and we will keep you posted on the next set of ideas.

Operator: This concludes the question-and-answer session. Thank you for participating in today’s conference.