Key Takeaways:
Barron's recommends buying Remitly Global, seeing 35% upside as international expansion and surging profitability disrupt the global remittance market.
"We delivered another excellent quarter, achieving record revenue, Adjusted EBITDA, and net income, while surpassing 10 million quarterly active customers for the first time," Chief Executive Officer Sebastian Gunningham said.
Second-quarter revenue rose 20% to $495.2 million, adjusted EBITDA jumped 79% to $114.7 million, and send volume climbed 27% to $23.5 billion. Active customers grew 20% to 10.2 million, with send volume per customer reaching a record $2,300, up 6% from a year earlier.
The buy call lands as Remitly raised its full-year revenue outlook to $1.978 billion-$1.988 billion, a 21%-22% increase, with adjusted EBITDA of $410 million-$415 million. Third-quarter revenue is forecast at $505 million-$507 million.
Remitly expanded its network to 179 receive geographies during the quarter, adding New Zealand, Niger, Mali, Angola and Botswana. U.S. revenue grew 24% year over year, while revenue from the rest of the world rose 18%, Chief Financial Officer Vikas Mehta said. Nearly 70% of globally funded transfers were delivered in less than 20 seconds, an all-time high.
Growth products beyond core remittances gained traction. High-value sender volume, transfers of $5,000 or more, rose 37% year over year, and Remitly Business ended the quarter with more than 25,000 users. The receiver product expanded from six countries to 130, generating revenue for the first time. The company also launched the Remitly Global Card and a stablecoin wallet in Latin America, and joined the OpenUSD consortium as a founding member.
Management credited AI-driven efficiency for operating leverage. Technology and development expense fell 175 basis points as a percentage of revenue to 11.2%, while general and administrative expense dropped 11% year over year to $41 million, its first annual decline as a public company. Free cash flow nearly tripled to more than $130 million, and Remitly repurchased $21 million of stock during the quarter.
Net income was $205.9 million, including a $140.6 million release of a tax valuation allowance. The recommendation pits Remitly against legacy money-transfer operators and digital rivals such as Wise, which Remitly added as a funding option for high-value senders in the U.S.-Mexico corridor.
The buy call signals confidence that Remitly can convert network scale into durable profit growth. Investors will watch the third-quarter earnings report for progress on monetizing newer products such as the Global Card and stablecoin offerings, which management expects to represent about 5% of revenue in 2026 and more than 10% by 2028.
This article is for informational purposes only and does not constitute investment advice.
