FLYW

Flywire stock has delivered strong gains over the past year yet longer term holders are still facing large declines, while current valuation checks suggest the shares lean expensive despite an intrinsic value estimate that sits only modestly above the market price. For investors looking at Flywire today, the picture is a recent recovery in the share price set against a low value score and mixed signals from different valuation frameworks. Over the last 5 years the share price has declined about 61%, which leaves Flywire trying to rebuild investor confidence after a difficult stretch. The new payments partnership with Travelling the Fairways in premium golf tourism can support growth expectations, while any setback in winning or retaining similar clients may weigh on how much investors are willing to pay for the stock. Flywire scores 1 out of 6 on broad valuation checks, which points to a stock that is not a clear bargain even though the Excess Returns intrinsic value estimate suggests it is roughly fairly valued. The issue now is whether Flywire's current price already reflects the cash flow profile implied by the intrinsic value work, or if the recent share price recovery still leaves room for a more attractive entry level. Compare Flywire's rebound and valuation signals with other companies that also pair growth stories with solid balance sheets through the curated solid balance sheet and fundamentals stocks screener (52 results) Excess Returns looks at how effectively Flywire turns its equity base into earnings above the required shareholder return. For Flywire, the model uses a Book Value of $6.71 per share and a Stable EPS estimate of $1.05 per share, based on weighted future Return on Equity forecasts from 5 analysts. With an Average Return on Equity of 12.89% and a Cost of Equity of $0.59 per share, the model calculates an Excess Return of $0.46 per share and a Stable Book Value of $8.15 per share projected from 4 analyst book value estimates. This stream of excess returns feeds into an estimated intrinsic value of $20.82 per share, which is about 9.3% above the current market price. Because Travelling the Fairways has selected Flywire as its exclusive payments partner, the market may be acknowledging growth opportunities yet still pricing the stock close to what the excess return profile supports. Overall, Flywire screens as roughly fairly valued on the Excess Returns model, with only a modest discount to the estimated intrinsic value. Flywire is fairly valued according to our Excess Returns, but this can change at a moment's notice. Track the value in your watchlist or portfolio and be alerted on when to act. Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Flywire. P/E is a useful yardstick for Flywire because earnings are a core focus for many investors watching how the business scales. Flywire currently trades on a P/E of 67.5x, which is more than double the peer group average of 32.9x and well above the diversified financial industry average of 16.9x. On the tailored fair multiple, which factors in the company’s growth profile, margins, size and risks, Flywire screens closer to 25.0x. That leaves a sizeable gap between where the stock trades and where the model suggests a more balanced earnings multiple could sit. This gap points to a market that already prices in a strong earnings story for Flywire, even though the Excess Returns model above indicates only a modest intrinsic value premium to the current share price. On the P/E lens, Flywire stock currently appears expensive relative to both its fair multiple and sector benchmarks. See what the numbers say about this price — find out in our valuation breakdown. Simply Wall St Narratives take Flywire's valuation puzzle and turn it into clear future scenarios for growth, margins and earnings. Each narrative links a fair value estimate to a specific storyline about Flywire's potential catalysts and risks, which helps you track over time which version of events is actually unfolding. These Narratives sit on Simply Wall St's Community page, where you can compare them and decide which assumptions feel most realistic for you. Community views on Flywire are split between a growth story that broadens its reach and a risk case that focuses on rising costs and competition. Bull case: 7% undervalued Read the full Bull Case to see why Flywire could be undervalued Bear case: roughly fairly valued Read the full Bear Case to see why Flywire could be overvalued Do you think there's more to the story for Flywire? Head over to our Community to see what others are saying! For Flywire, the Excess Returns intrinsic value estimate points to only a modest upside, while the P/E view flags the stock as overvalued against both peers and a tailored fair multiple. That mix suggests the shares are no longer obviously cheap and that a lot of earnings optimism is already in the price. The key swing factor from here is whether Flywire can convert its pipeline and partnerships into earnings that justify a premium multiple rather than leaving today’s valuation looking stretched. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include FLYW. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Flywire’s second quarter was marked by strong performance, driven by broad-based growth across its core verticals and continued client wins in education, travel, and B2B payments. The company’s ability to consolidate complex payment workflows and replace legacy providers resonated with new and existing clients, especially as organizations sought efficiency amid regulatory and macroeconomic uncertainty. CEO Michael Massaro noted that Flywire’s “differentiated software offerings” and “growing market share” have positioned it as critical infrastructure for clients in both established and emerging markets. Is now the time to buy FLYW? Find out in our full research report (it’s free). Revenue: $163.8 million vs analyst estimates of $156.7 million (28.5% year-on-year growth, 4.5% beat) Adjusted EPS: $0.11 vs analyst estimates of $0.12 (in line) Adjusted EBITDA: $24.04 million vs analyst estimates of $21.57 million (14.7% margin, 11.4% beat) Revenue Guidance for Q3 CY2026 is $231 million at the midpoint, above analyst estimates of $229.1 million Operating Margin: -1.7%, up from -7.1% in the same quarter last year Billings: $161.6 million at quarter end, up 28.9% year on year Market Capitalization: $2.11 billion While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention. Christopher Svensson (Deutsche Bank) asked about the impact of proposed U.S. visa regulations on education demand. CEO Michael Massaro and CFO Cosmin Pitigoi responded that guidance assumes a prudent 30% visa decline, with ongoing monitoring of policy developments and client data. Daniel Perlin (RBC Capital Markets) inquired about the expected business mix as Flywire targets $1 billion in annual revenue. Massaro explained growth will be driven by software expansion in education and continued momentum in travel and B2B segments, with hospitality’s international expansion playing a key role. Madison Suhr (Raymond James) focused on the opportunity for cross-sell and net retention in non-core education markets. Massaro and President Rob Orgel described global aspirations for their education suite but noted readiness for full software adoption varies by region, with top 4 markets still prioritized. Michael Infante (Morgan Stanley) questioned the impact of domestic versus cross-border volume growth on gross margins. Massaro and Pitigoi explained that while domestic volumes carry lower yields, software attach and renewals are improving economics, and unit economics remain positive due to higher gross profit dollar flow-through. Tien-Tsin Huang (JPMorgan) asked about expense visibility and AI implementation costs. Pitigoi stated that digital transformation and AI investments are driving productivity gains and keeping operating expense growth in check, with no negative surprises expected. In the coming quarters, the StockStory team will focus on (1) the pace of software adoption and international client signings in education and hospitality, (2) the sustainability of rapid payment processing growth in B2B and healthcare, and (3) the impact of regulatory changes and visa trends on education revenues in key markets. Execution on digital transformation and AI-driven efficiencies will also be critical to tracking Flywire’s margin trajectory. Flywire currently trades at $17.13, in line with $17.26 just before the earnings. Is there an opportunity in the stock? Find out in our full research report (it’s free for active Edge members). ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren’t just high-quality businesses. Something is happening with them right now. Elite fundamentals meet near-term momentum — both boxes checked at the same time. Find out which stocks our AI platform is flagging this week. See this week’s Strong Momentum stocks — FREE. Get Our Strong Momentum Stocks for Free HERE. Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+271% between June 2020 and June 2025). Find your next big winner with StockStory today.

Image source: The Motley Fool. Tuesday, Aug. 4, 2026 at 5:00 p.m. ET Chief Executive Officer - Michael Massaro President and Chief Operating Officer - Rob Orgel Chief Financial Officer - Cosmin Pitigoi Vice President of Investor Relations - Maria Kahn Operator: Good day, and thank you for standing by. Welcome to the Flywire Corporation Second Quarter 2026 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I'd now like to hand the conference over to Masha Kahn, Vice President of Investor Relations. Please go ahead. Maria Kahn: Thank you, and good afternoon. With us today are Mike Massaro, Chief Executive Officer; Rob Orgel, President and Chief Operating Officer; and Cosmin Pitigoi, Chief Financial Officer. Our second quarter 2026 earnings press release, supplemental presentation and, when filed, Form 10-Q are available at ir.flywire.com. Today's call is being recorded and will be available for replay on our website. During the call, we'll be discussing certain forward-looking information. Actual results could differ materially from those contemplated by these statements. In addition, unless otherwise indicated, all financial measures discussed on this conference call are non-GAAP financial measures. Please refer to our press release and SEC filings for more information on the risks related to forward-looking statements and the required reconciliations of non-GAAP financial measures. With that, I'll turn the call over to Mike Massaro. Michael Massaro: Thank you, Masha, and thank you to those joining us today. We are excited to announce yet another quarter of strong revenue and EBITDA growth as well as momentum in the business continuing to build. Signed deals are getting bigger and clients are replacing legacy providers and point solutions to consolidate on to Flywire. We will take you through the quarter in much more detail. But first, I want to step back because I want stakeholders to see Flywire the way we do. We continue to deliver solid growth and the quality of that growth is improving. We are converting incremental dollars of gross profit into durable earnings, expanding our free cash flow, and we believe we are well positioned to continue gaining market share. Let me explain why Flywire's moats and financial model don't just coexist. They compound, each getting stronger as we scale. You know the Flywire model. We go where others are unwilling or unable to go, embedding into complex mission-critical workflows and solving payment challenges that are larger, more international and far more difficult than simple checkout transactions. That complexity is our moat, and it deepens on its own. Rising regulation, expanding global flows and deeper integration requirements are headwinds for simpler competitors and tailwinds for Flywire. Once deployed, we become critical infrastructure with revenue churn across enterprise clients in education and travel below 1% as of 2025. So today, I also want to put our model into financial terms, what it means for revenue, margins and cash flow over the next few years. As CEO, I am focused on three core metrics. First, revenue and gross profit dollar growth. On this foundation, we are aiming to achieve $1 billion of annual organic revenue within the next few years. Given the free cash flow this business is expected to generate, acquisitions remain an additional powerful lever. Our diversification engine underpins the path. Growth outside our traditional Big 4 education markets continues to outpace the overall business. Differentiated software offerings like SFS, driving domestic growth above and beyond visa trends. Travel continues to perform well, and the payments monetization in our hospitality business is outperforming our expectations. And our smaller verticals, B2B and health care, are gaining scale and becoming growth contributors on their own. Second, EBITDA margin progression. We believe a 30% adjusted EBITDA margin is achievable over the next few years, with most of the expansion coming from operating leverage we can already see in our expense base. The productivity gains from our transformation are real. They are improving both LTV to CAC and our cost to serve, proving that operating expenses can grow well below gross profit growth for longer. Scaling fast organically and through acquisitions naturally adds costs and friction across systems, vendors and processes. We are consolidating that into a leaner foundation purpose-built for the next phase of growth and scale. At the center of this is our payment platform investment. We are unifying systems onto a single modern payment architecture. And our digital transformation is rearchitecting our internal operating system so that our people and AI agents can seamlessly work side by side to structurally lower our cost to scale. Because these investments fundamentally change how work gets done, the operating leverage they create is durable. And third, multiyear free cash flow and GAAP earnings growth. Free cash flow generation and capital efficiency are central to long-term shareholder value. We remain highly committed to strong free cash flow conversion alongside continued discipline on stock-based compensation and dilution. Combined with a strong balance sheet, this cash flow generation is a powerful source of strategic flexibility. We can invest organically, repurchase shares and stay opportunistic on M&A, all from a position of strength and all while growing free cash flow per share. Durable gross profit growth, compounding earnings and expanding free cash flow. That is how we intend to build shareholder value. But reaching our $1 billion annual organic revenue target requires high conviction and concentrated investment. Today, we are directing our capital into three core areas. First, gaining share and expanding our software moat. We are actively investing to expand our software and workflow capabilities across all verticals, such as investing in more functionality and integrations for SFS and taking our hospitality software from a historically U.S.-focused business into a global hospitality platform. Second, expanding our payments platform. As our volume scales, we are driving operational discipline to improve unit economics and strengthen our value proposition, better corridor economics, deeper local banking relationships and a cost per transaction that is expected to decline as we grow. Third, our digital transformation, a major priority in strengthening internal operations through data architecture investments, AI integration and systems consolidation. This is designed to drive productivity and long-term operating leverage across the business. Cosmin will walk you through the rigorous financial framework we use to evaluate these organic investments alongside our broader capital allocation and share repurchase strategy. Our ability to confidently execute this capital strategy stems directly from our resilience in the market. Our team continues to deliver in an uncertain macro environment. What matters most is that clients are seeing ROI from consolidating their payment flows on Flywire. Some clients need help to grow while others are automating to reduce costs. Across all market conditions, the value Flywire delivers speaks for itself and interest in our solutions continues to grow, both in markets that are under pressure and those that benefit from higher numbers of international students. Let me be direct about the current environment. The macro backdrop remains challenging. We see recent negative trends in U.K. visas. Australia has raised visa fees again, and regulations in both the U.S. and the U.K. have become more stringent. Enterprise sales cycles are long and large health care deals like Cleveland Clinic can boost growth 1 year and create a tough comp the next. But here's what really matters. The Flywire business is vertically diverse, geographically diverse and has multiple product growth levers. This means we can navigate challenging macro conditions while hitting the framework I just described. We don't need conditions to improve to build a business with $1 billion in annual organic revenue with 30% margins. And in some ways, the industry pressure works in our favor. When institutions face cost and volume pressure, the case for automating manual payment flows gets stronger, not weaker. When they consider choosing a partner for the future, they look to companies that are innovating, growing and financially strong. Ultimately, Flywire is succeeding on the strength of our business, not because of easy market conditions. Let me now shift to AI and how it is becoming an enabler for Flywire. AI increases the value of whoever owns the workflow and the data, and we own both. This quarter, I want to show you how this thesis is playing out in delivering real results, not projections. About 45% of customer inquiries now resolve automatically without human intervention. And with the support platform adopting generative AI across chat, e-mail and phone, we are targeting over 50% auto resolution rate by the end of the year. More broadly, AI is embedded across Flywire's engineering and product teams with frontier models, shared best practices, strong governance and autonomous agents handling tasks like code retirement, conflict resolution, bug fixing and test maintenance. This allows our teams to focus on building new products, making digital transformation a fundamental shift in how work gets done, not just a cost-saving initiative. And AI is transforming our go-to-market as well. Enablement is now always on. AI captures winning tactics from live client conversations and delivers them as continuous coaching, cutting new hire ramp times and scaling the Flywire way without additional management overhead. In closing, none of this happens without our Flymates. We recently completed our company-wide engagement survey called Flyover, and the results were strongly positive. Our teams are embracing AI and the productivity it unlocks. And they tell us they feel more creative and more energized in their work. Ultimately, transformations succeed when people lean into them. Flymates are doing this. And that kind of organizational momentum is rare. Flywire is a great business with a powerful financial model and an exceptional team, and we are built to keep getting stronger. With that, I will hand it over to Rob to take you through more details on the execution from the quarter. Rob? Rob Orgel: Thanks, Mike. Q2 results continue to reinforce the fact that our modern product portfolio is widening our competitive moat, and we are systematically taking share from traditional payment processors and point solution providers across every vertical we serve. We signed over 200 new clients across 45 countries and all verticals, the second consecutive quarter at that level. Signed ARR continues to benefit from existing client land and expand as well as larger average deal sizes. Travel led the new client count followed by education, and we are very excited about the pace of signings even as we deliberately move towards larger, more strategic engagements. Last quarter, I laid out three themes defining our business: strategic vendor consolidation, geographic diversification and software-led monetization. Those weren't one quarter observations. They're structural growth drivers. So today, I want to walk you through how each of these three themes is driving consistent results. Starting with strategic vendor consolidation. Our client conversations typically start in the same place. We hear about too many vendors, too many manual workflows, too much payment complexity and a great many of those conversations end in the same great place, consolidation on to Flywire. As an example, the University of Liverpool has signed for our SFS platform in the U.K., a win that showcases the full value of the suite. Liverpool has everything that makes student finance hard, a large international enrollment paying from dozens of countries, domestic students on plans, parent access requirements, refunds, hardship cases and more, all running through manual processes and a patchwork of systems. We're consolidating that onto one platform. For students and families, a modern portal with real-time balances, authorized parent access and self-service payment plans. For the university, a real-time integration with their Unit4 ERP that will eliminate many hours of manual posting work, reduce merchant fees and give their finance team a unified automated view of student financial activity. We continue to see strong interest in SFS in the U.K. In the U.S., we signed three new SFS deals this quarter, with an ARR value double the signings in the same quarter of 2025, and our pipeline continues to build. When an institution is genuinely ready to switch providers, we believe we win those opportunities with SFS far more than our competitors. What's driving these wins is ROI institutions can measure. SFS pays for itself across three dimensions. First, operational efficiency. Automating billing, payment plans and past due outreach has reduced inbound student contact volume, in some cases, by 40%, letting school student finance teams run leaner, even as enrollment complexity grows. Second, cash flow. Self-service payment plans have driven roughly 50% higher plan enrollment with default rates falling from as high as 34% to below 2%. And third, revenue recovery, a solution we pioneered. Our clients have now collected more than $360 million in past due tuition in-house, saving over $70 million in agency fees. And for many institutions, the ROI is highly attractive compared to the license fees they pay Flywire. That is the essence of consolidation, one billing to collection platform replacing a billing vendor, a payment plan vendor and a collection agency and paying for itself in the process. Shifting to experiential travel. Our deal sizes are rising as travel groups merge and migrate more of their entities onto Flywire rails. Again, consolidation working in our favor. Win rates continue to improve. Our brand carries real weight in this market and the TAM remains largely unpenetrated across golf, hiking, cycling and many other luxury experiences. The second theme is geographic diversification, and we drove strong growth outside our traditional Big 4 markets of the U.S., U.K., Canada and Australia. We saw education revenue grow outside those markets by over 30% year-over-year in Q2 and approximately 2/3 of the new education clients we signed were in growth markets outside the Big 4. In Europe, international students continue to diversify destination markets, and European universities are responding. Some are introducing more English language programs and some are charging higher fees. We are particularly happy to see strong share gains in Spain and Switzerland and continued strong momentum in the private K-12 segment. We are positioning Flywire to benefit from trends favoring student and tuition growth in Continental Europe. In Asia, we are executing well in markets that are opening up to international students. South Korea and Japan are actively courting international enrollment to help address shrinking domestic workforces. We are winning there. This quarter, we went live with a number of prestigious universities in both countries, and our regional pipeline continues to build. Wrapping up my comments on why we win in global education. In Canada and Australia, where the broader markets remain under policy pressure, our growth is powered by share gains. This quarter, we started processing payments for Sheridan, a major Canadian college where international students make up over 8,000 of roughly 20,000 enrolled; and for Bond University, Australia's first private nonprofit university, a prestigious Gold Coast institution with one of the highest international student ratios in the country. Wins like these in constrained markets are the clearest evidence of our share gains. Finally, speaking to our software-led monetization, our software-led approach has been a key catalyst for capturing and monetizing payment volume. It's at the heart of Flywire doing what others can't. Our hospitality software, which is used across over 20,000 properties, streamlines workflows and where it's combined with our payments offerings, replaces costly and insecure manual card processing with customer-initiated payments such as ACH, card surcharging and local methods, along with providing enhanced security from capabilities like 3D Secure. The results are striking. Payment fees dropped meaningfully, in some cases, by more than half and win rates on disputed transactions more than double. Our ideal hospitality customers are luxury resorts and properties managing high-value stays and complex events. Notable recent wins include contracts with large hotel management groups such as Peregrine Hospitality, Avion Hospitality and Marcus Hotels & Resorts, each of which owns or manages a portfolio of hotels and resorts great for our hospitality solutions. Having proven the model in the U.S., we've signed more than 40 locations across Europe and Asia year-to-date, and we believe we are just getting started. In Education, as we deepen the software layer around our payments platform, clients are renewing for longer terms and on economics increasingly favorable to us because the software has become embedded in how they operate. We see this dynamic of longer and better terms compounding over time as we continue to deliver for our clients. We're seeing software-led monetization work across our other verticals, too. In health care, the patient financial experience platform is now live with payment processing across multiple clients, including additional go-lives in Q2, a good example of software attaching to payment processing. In B2B, we replaced the legacy pattern, invoicing out of the ERP, payments through the bank and heavily manual workflows with a single invoice to cash platform from Flywire. What is most exciting right now is our velocity and depth of capture. Increasingly, new B2B clients are adopting both our invoice software and payments from day 1. This quarter's wins show the breadth of demand. a digital asset management company automating its AR operations, a wealth management firm signing for the full suite of invoice plus payments, and an international insurer collecting premiums globally. All serving finance teams drowning in manual work for whom a unified AR and payments platform is an immediate measurable efficiency gain. Those three themes, consolidation, diversification, software-led monetization, aren't just how Q2 played out. They're how we expect this business to build for years. Cosmin will now take you through the strong financial performance this quarter and future outlook. Cosmin? Cosmin Pitigoi: Thank you, Rob. I will cover our financial performance for Q2 2026, discuss our capital allocation philosophy and provide our updated full year outlook and additional details behind the longer-term ambitions. Q2 performance strength underscores the resilience of our diversified portfolio with results coming in ahead of expectations. Total revenue less ancillary services reached $164 million, up over 28% on a spot basis and 27% FX-neutral growth. Our outperformance versus the midpoint of our guide on an FX-neutral basis was largely driven by our travel segment, which continues to pace ahead of our expectations. This strength was specifically fueled by hospitality payments being a strong ramp. Our education revenues were also ahead of expectations. The stronger-than-expected payment processing volumes from health care alongside our B2B invoice migration drove an approximately 7-point growth tailwind to payment processing in Q2, ahead of the mid-single-digit impact we guided to. We expect this payment ramp to decelerate in the second half as we annualize these revenue streams go live. Transaction revenue was $135.9 million, up 35% year-over-year. This was driven by 43% growth in transaction payment volume with continued contribution from education, both cross-border and domestic as well as travel. As a reminder, quarter-to-quarter blended yield can vary with mix, especially as domestic payments ramp up. Higher domestic volumes and greater credit card penetration carry different economics than cross-border flows. On a like-for-like basis, pricing remains stable and competitive behavior continues to be disciplined. Our spreads reflect the value we deliver, compliance, reconciliation, ERP integrations and enterprise-grade infrastructure, not commodity payment processing. Platform and other revenues were $28 million, up 3% year-over-year, primarily driven by growth in hospitality. Adjusted gross profit reached $93 million, increasing 19% year-over-year at spot. Importantly, this 19% gross profit dollar growth is successfully converting into adjusted EBITDA margin expansion, demonstrating real operating leverage. Adjusted EBITDA was $24 million, resulting in a 14.6% margin and expanding approximately 160 bps year-over-year, which was above the upper end of our guide. The strength in adjusted EBITDA reflects gross profit growth and continued operating leverage across every expense category. Our adjusted gross margin of 56.6% was down by approximately 450 basis points. Margin dynamics are driven by three factors: mix, FX and temporary large payment processing ramps, not competitive pressure. This quarter, the margin change was primarily driven by approximately 300 basis points from the mix contribution of higher payment processing revenues from health care and B2B that began ramping in the second half of 2025. The balance of the margin change was due to continued vertical mix shifts. FX on settlement impact in Q2 was $0.7 million on an absolute basis, but we did benefit from a favorable year-over-year comparison given the headwind we experienced in Q2 2025. Excluding the approximately 300 basis points from this ramp activity, our normalized gross margin decline would have been around 150 basis points, which is squarely within our expected normal annual range of 100 to 200 basis point decline. We emphasize that these current ramp dynamics are temporary and will be largely complete by the end of 2026. In Q2, we had a GAAP net loss of $8 million, improving versus a $12 million loss a year ago. The second quarter is our smallest revenue quarter with net income and free cash flow generation seasonally depressed and expected to reverse in Q3 and both be strongly positive for the full year. Turning to capital allocation. We are disciplined allocators. Every dollar competes on expected return through an IRR framework that weighs organic investment, share repurchases and M&A against one another. That is why we repurchased shares aggressively into dislocation and why organic investment is concentrated in our highest conviction areas, and why we remain patient on M&A. Our balance sheet remains strong with approximately $167 million in corporate cash, giving us significant financial flexibility to remain opportunistic, manage dilution, pursue acquisitions while continuing to invest in the business. Moving to guidance. We are raising both revenue and EBITDA guidance for the full year 2026. We now expect 21% to 27% FX-neutral revenue growth with approximately 3 to 4 points from payment processing ramps in B2B and health care, and roughly 1.5 points of inorganic contribution as we lap Sertifi. Full year 2026 adjusted gross profit is expected to grow at high teens year-over-year at spot. We expect approximately 200 to 400 basis points of full year EBITDA margin expansion, reaching approximately 23% at the midpoint. Stock-based compensation remains targeted at approximately 10% of revenue, and we are aiming to reduce our new stock issuance in dollar terms every year. Alongside this, we continue managing gross and net dilution in a disciplined manner, targeting less than 2% dilution this year and less than 3% on an ongoing basis. Furthermore, we maintain our expectations of free cash flow conversion of 70% to 75% of adjusted EBITDA and upgrade our expectations for GAAP net income to grow fourfold this year to over $50 million. Our Q2 performance, combined with more upside from payment-related product ramps through the remainder of the year leads to upgraded full year 2026 guidance despite our more cautious assumptions around education revenues. Before I walk through the details, let me flag the shape of the growth from here. Several of our newer revenue streams are ramping faster than we planned this year, payment processing in both B2B and health care and Sertifi is domestic payment processing, which is accelerating ahead of our expectations. That's a good problem. These investments are converting sooner than we modeled. This has two consequences worth setting upfront. First, this accelerated ramp makes 2026 a stronger revenue base, which creates a tougher comparison as we move through the second half and into next year. Separately, and as we assumed coming into the year, we expect U.K. education revenue growth to slow. That's already baked into our outlook. Second, because these streams carry lower gross margins than our blended average, full year gross margin decline would be higher than the range we previously discussed, closer to 350 basis points on a reported basis and closer to 200 if normalized for the current payment ramps in health care and B2B. Let me be clear on that second point because it matters. These ramps pressure gross margin, but not EBITDA. The pressure is pure mix. Processing volume carries a lower gross margin rate, but very little incremental OpEx because it runs over infrastructure and relationships we already have. So every gross profit dollar converts to EBITDA at a high rate. Q3 2026 guidance. Our approach to guidance hasn't changed, prudent, transparent and data dependent. Visibility into the peak is always relatively limited at this point in the year. So we've talked to agents and to our clients. But we don't take that input at face value. In the U.S., they expect declines, but are more optimistic on average than our assumptions, and we've held to a 30% visa decline. In the U.K., we are seeing higher visa rejection rates in Q1, and we've baked that in. In both cases, we weigh what we hear against what we're seeing in our own data, and we've set our assumptions from there. For Q3 2026, we expect FX-neutral revenue growth of 16% to 22% year-over-year. At current spot rates, we anticipate almost no FX tailwind. Gross profit dollar growth is expected in the low teens range at spot rates, including an estimated 1 point headwind from FX on settlement year-over-year dynamics. Adjusted EBITDA margin is expected to expand by approximately 200 basis points year-over-year at the midpoint of our guidance. One timing dynamic on the Q3 versus Q4 split. A meaningful share of our education volume settles around U.K. deadlines in early October, right as the Chinese national holidays fall in late September and early October. Payers heading off for the holiday may settle ahead of that deadline, pulling volume that would land in Q4 forward into Q3. That moved roughly 2 points of growth from Q4 to Q3 last year. That cuts both ways in this year's comparisons. Q3 is lapping a quarter elevated by that pull forward, while Q4 is lapping a base reduced by it. So Q4's year-over-year growth rate will look better than the underlying trend and Q3 is worse, assuming no repeat of the Chinese payer behavior this year. Holiday timing differs slightly this year and payer behavior is hard to predict. Either way, the cleaner read is to look at our performance for the second half as a whole. In closing, as we scale towards our $1 billion in revenue and 30% adjusted EBITDA margin goal over the next few years, we're focused on structural operating leverage. Transformation investment peaks in 2027, with material savings expected to come through thereafter. So we expect operating costs to stay roughly flat beyond that whilst continuing to invest in strategic priorities. Investments in consolidating platforms, scaling data, AI, systems and automation are already boosting engineering and sales output, letting us streamline R&D, optimize sales and marketing, and redeploy savings into growth priorities and AI-enabling architecture. Even through this planned peak investment period, we have contained OpEx growth, and we are now targeting approximately 25% adjusted EBITDA margin by 2027. In closing, Q2 demonstrated the durability of our diversified platform and the scalability of our operating model. We are managing for a specific outcome, durable, profitable growth in an environment where top line growth is normalizing. And here's what gives us confidence. Operating leverage compounds independent of the top line cycle. So even as revenue growth moderates, and we do expect it to, the algorithm holds. The combination of growth and profitability we deliver stays firmly in the range this business has always targeted. That is the promise of our digital transformation, margin expansion that holds at scale through the cycle quarter after quarter. Along with our Flymates embracing our vision, I am very excited about what we're building and how far it lets us scale. I'll now turn it back to the operator for questions. Operator? Operator: [Operator Instructions] Our first question comes from Nate Svensson with Deutsche Bank. Christopher Svensson: Nice results. I think I'll start off just asking about the international visa situation in the U.S. I know there's been a lot of proposals and news articles written on potential new regulations. So wondering from your perspective, probability of any of these proposals going through and sort of any, I guess, concerns that this could create some demand destruction similar to what we saw in other geographies. And then I think more broadly speaking, it still feels like the 30% visa reduction looks conservative, but I know we're kind of right in the heart of the most important months here for F-1 visa issuances. So wondering if you could give any color that you have either from your end clients or some of the third parties that you work with on what's going on in the U.S. Michael Massaro: Nate, it's Mike. Yes, I mean, as you mentioned -- I'll start and I'll let Cosmin talk to a little more of the specifics around what's in the guide. Obviously, you're seeing various headlines around the world continue. And again, I think that's part of the reason coming off last year, we've kind of taken a prudent approach to how we look at this and looking at it by region and by market. And so again, a lot of these are exactly what you said. They're statements, they're proposed policies. They're not kind of approved policies, they're not in place. And historically, we've seen the headlines oftentimes be a lot worse than the actual end results. And so again, we're being prudent. Cosmin, I think, has taken that into account in the way in which he looks at different regions in the guide, and I'll let him comment on that. Cosmin Pitigoi: Yes. So I think as you said, Nate, we've always looked at it taking a prudent approach to that 30% decline. And we have -- we're about a month into the quarter. So we do have some visibility into the overall trends. As you know, usually, U.S. peaks around August. And so we do have some visibility into that, but we feel pretty good that we've taken that -- the right prudent approach. And look, it's a multiyear thing that we look at. So I feel good that we've taken a pretty good approach here in terms of being prudent around the U.S. assumptions. Christopher Svensson: Yes, agreed. And I appreciate the color. For a follow-up, I wanted to ask on the three new U.S. SFS signings, specifically on the commentary that they came in at double the ARR of the prior year quarter. So I wonder if you could talk about the ARR portion of that specifically and what's kind of driving the strong year-over-year expansion. I assume a lot of it is kind of the land and expand strategy that you've talked about before. Anything on pricing? And then maybe beyond the recent deal signings, kind of how sustainable do you think the growth in ARR with these SFS wins is going forward? Rob Orgel: Yes. This is Rob. I'll jump in here. Obviously, we're excited about the progress we've made here. You called it out right in what we called out in the comments with the doubling of ARR for those U.S. deals. It's all part of the strategy, right? We are focused on full suite deals. We are focused on enterprise. We are doing what we think is the right things to do to make sure we are putting a very skilled and expert sales team in the field to deliver this kind of enterprise quality deal. And further, I think our name is getting better and better in the market, right, as we've delivered for some of the logos and institutions that you heard us talk about on previous calls. It's a very connected industry where people talk to each other, and our name is very good out there. So in terms of confidence going forward, we feel very good about sort of the second half quality of the pipeline and what we expect to see for the rest of the year. Operator: Our next question comes from Dan Perlin with RBC Capital Markets. Daniel Perlin: Good results here. I just wanted to ask, Mike, about kind of the mix of what you envision this $1 billion of organic revenue to look like as you think about education, travel, B2B, health care. Like how do you think that will change through the course of this, I guess, multiyear strategy? And obviously, Cosmin gave some financial implications for this, but I was just wondering how you think that might look. Michael Massaro: Dan, thanks for the question. I would say think of the things that have driven our growth so far, right? I mean you've seen great growth and we called it out in travel and in B2B, like we expect those trends to continue. At the same time, the education business continues to perform well. We continue to layer in software there. And I would say that kind of fits into where we kind of expect it to go, right? Think of more software and education, continued growth in the travel and B2B segments in particular. And I'd really say it goes there. Obviously, the hospitality expansion internationally is a key part of that, that we expect to have a multiyear effect. And so I would say those are the kind of the organic levers that we expect to kind of play out. And you may see a slight mix shift, but I would say it's pretty consistent with what you've seen in the last few years. Daniel Perlin: Okay. That's great. And then just going back to the geographic diversification here again. The education markets that are outside the Big 4 grew 30% this quarter. I think it was 40% last quarter. It's 30% before that. So it's continuing to materially outpace everything. And then I heard like Japan and South Korea, like actively looking for students. So I'm just trying to get a sense of how big that market is today in terms of its overall mix. And obviously, that's a positive mix shift in terms of incremental growth if you're not having to deal with so much of the regulatory issues. So just anything around that would be helpful. Rob Orgel: Dan, I can jump in, Rob here. So I think we've called out previously that sort of that way of segmenting that we're talking about the business is sort of low teens percentage of 2025 revenue. As you called out, we saw 30% growth in that beyond the Big 4 education in this most recent quarter. I made a trip to the region just a little bit ago, and you really feel sort of the opportunity that we have there. I got to visit a number of institutions, got to hear from them the manner in which Flywire really can solve problems that are front and center for them. And so you see them adapting to the interest in those regions of international students to come to them and you see them adapting our solutions to be able to serve them well. Operator: Our next question comes from Madison Suhr with Raymond James. Madison Suhr: I wanted to start on the U.K. Obviously, it's a key market for you guys, comprises about 1/4 of revenue. I know visa trends have been challenged, but can you maybe touch on where you see the most opportunity in the region, whether that's domestic cross-sell, SFS penetration? And do you think the region could still grow kind of above company growth rates for the year despite some of these visa headwinds? Cosmin Pitigoi: So maybe I'll start just on the assumptions in the guide, and I'll pass it to Rob to talk a bit more. So yes, U.K., the macro backdrop clearly softened. So we thought it was obviously prudent to adjust our visa assumptions. And so we're assuming that -- if you think about it roughly in the last couple of years, we've seen U.K. visa declines in the mid-teens. And so we're assuming roughly a bigger decline than that. However, with that, we're still assuming that U.K. remains an important growth driver for us, even though we're assuming deceleration into the second half from the U.K. because of, again, some of the -- many of the levers that we've talked about before, also because, again, the visa declines are -- right now, the quarter-to-date that you've seen is a small sample size. So feel good from what we've heard from -- on the ground, but we're taking a prudent approach. So maybe I'll let Rob talk a little bit about the drivers and the levers we have in the market. Rob Orgel: In terms of the market opportunity, we feel really good about our positioning in the U.K. If you remember from some of my comments on prior calls, we've talked about the desire to sort of move all the money on behalf of our clients and having two main mechanisms or levers that we can use to accomplish that result. So one of the ways we talk about it is the number of clients where we see ourselves moving 90% or more of their money using sort of our internal method, our internal methodology for all that. We previously shared we had approximately 12 in that category. We've continued to grow that number. We call that number about 20 now. Second big dimension is growth in SFS footprint inside the country. Obviously, our attach rate is still very low, and we're working to build that. And one of the main things we're doing and making very good progress with is increasing the number of integrations that we have into what are the core systems that serve the university community there. And so you've heard us call out progress with Unit4, with Oracle. We certainly talked about our work with Tribal. All of that is part of the ability to expand there. And as the U.K. schools see us being successful with their peers, they are that much more inclined to work with us. Madison Suhr: Okay. Great. And then I want to follow up on the non-Big 4 region as well. Obviously, it sounds like the near-term focus is more on winning clients that have a healthy level of international student enrollment. But just as we think about the longer-term opportunity there, do you think you have the similar ability to cross-sell adjacent products into that region? And I'm really just trying to get a sense of for the non-Big 4 specifically, what can drive NRR growth in that region over time? Michael Massaro: Madison, this is Mike. I think if you look at our other offerings in the education suite, we've always had global aspirations for those, and I think we continue to have them. I think what we see in a lot of international markets is part of a readiness question, right, is you'll see whether it's the student information systems, whether it's the partnerships, the integrations needed. Oftentimes, we're digitizing that payment experience, and that is significant for them. And when they think of like a full student account portal and like the software you would see here in the United States or in a major market, they're not quite ready for that yet. So we'll be opportunistic whenever we see those opportunities. But also, it's a huge opportunity in the top 4 markets. So our focus is on that. It's on executing there, but we see opportunity for a lot of our product suite outside of the top 4 as well, just over that kind of longer-term horizon. Operator: Our next question comes from Michael Infante with Morgan Stanley. Michael Infante: I wanted to ask a bigger question to contextualize the multiyear SFS opportunity and how you expect the unit economics to evolve. You've obviously spoken in the past about SFS being a real multiplier effect to both revenue and gross profit. But at the same time, the mix is obviously shifting more towards domestic volumes, carry structurally lower yields than cross-border. So I'm just curious how you think about the offsets to that mix shift on a relative basis and how much incremental volume you really think you can capture with SFS and really what it looks like over the next few years as you march towards that $1 billion revenue target? Michael Massaro: Michael, it's Mike, and then I'll hand it over to Cosmin to double-click on the numbers. So think of it at the level of the kind of gross margin mix being a positive, right? It is a mix, like you said, of software and domestic, but it still blends to something that is very good for Flywire and helpful in kind of maintaining strong gross margins. I would also say, think through the dynamic that we mentioned on the call as well around over time, we're seeing our economics actually improve in SFS over time, right? And so you're seeing average deal size go up. You're seeing renewals be strong. Those are both things that to us are very, very strong positives. And ultimately, when you get SFS, you get all the volume, right? You are dealing with all the domestic, all the cross-border volume going through one platform. So that is a core part of the strategy. That is how we think we're maximizing value for our clients. And I'll let Cosmin double-click on the financial profile. Cosmin Pitigoi: So in terms of the numbers, just one disclosure we have around the size of the business. That's -- the domestic business in the U.S. is about 1/3 overall, is what we've said. And think of that as, in terms of revenue growth, as above company average in general. It's been there. Given what you heard from Rob as far as SFS success, we expect that 1/3 of the U.S. business to continue growing faster. And that's one of the reasons why we're able to see and guide U.S. education revenue to grow in the low single digits this year, given the pressure on the cross-border side. So really strong growth there from the domestic side. And yes, in terms of -- the gross margin is still very positive. And again, once you move from cross-border to domestic, you get more of the payment plans, you get software, as Mike said. So there's a good -- still a solid 2 to 3x kind of gross profit dollar increase, which -- and again, runs over the same kind of cost rails for us. So as you heard me talk about, that's a strong EBITDA dollar flow-through from that because it is on existing clients and existing relationships. Michael Infante: That makes a ton of sense. And just a quick housekeeping follow-up on Madison's question just on the U.K. revenue growth. I think you guys remove that commentary in the presentation about the U.K. and EMEA growing at or above company average. So I guess, should we be assuming that U.K. revenue growth is dilutive to the aggregate business this year? And if so, by how much, right? Like the visa expectation was obviously reduced marginally, but that's obviously your deepest SFS and domestic payments market. So I'm just trying to contextualize that dynamic. Cosmin Pitigoi: So at least the way I think about the U.K. is decelerates in the second half given these assumptions. And again, this is us taking a prudent view, still a lot of the quarter to go, and we'll update you there. But yes, it is assumed that U.K. would at least exit at a lower rate than the overall company. And then I would just, again, remind you, we're taking a prudent approach. And second, that we have SFS and other levers there that give us confidence that long term, we will continue to gain share. And again, you heard some of the stats from Rob around our ability to gain more of those types of 90% clients. So again, it is -- but it's all in the guide. And again, that's overall taking a prudent approach to the overall guide given that view. Operator: Our next question comes from Cris Kennedy with William Blair. Cristopher Kennedy: Cosmin, you mentioned the stronger revenue guidance this year may create a more difficult comp as we get into 2027. I know you're not going to give official guidance, but any way to think about some of the growth dynamics as we get into 2027? Cosmin Pitigoi: I think generally, as always around this time of halfway through the year, you can look at exit rate. I think given some of the dynamics I talked about in terms of timing, I think looking at second half. And so that is sort of a high teens kind of FX-neutral growth rate. But then if you kind of take out the sort of, call it, 2 to 3 points, or call it, closer to 3 points or so of payment processing ramps that I talked about in the second half, you get closer to a kind of normalized for payment ramps of roughly in the mid-teens. And that's kind of how you tie back also kind of a normalized gross margin decline comment into next year. And then the only thing I would add to that is just remember that last -- this year, Q1 was extremely strong. We had not -- obviously, we have organic and inorganic piece, but then we had a mid-single-digit tailwind and really strong performance from EDU in Q1. So that's the other component to think about. So hopefully, those help. Again, still early, and we're not yet guiding into next year, but those comments should help kind of directionally start you for next year. Cristopher Kennedy: Great. And then any -- can you give any more color on your K-12 business and kind of compare and contrast that relative to higher ed? Rob Orgel: Cris, Rob here. So K-12 has been a long-term segment for us. It's not a new thing that we talk about pursuing. What has been interesting is that around the world, there are interesting pockets, interesting markets where we may not previously have pursued that, and we are now going ahead and doing that. It's all part of what you would call under the umbrella of sort of diversifying international mobility, and we are making sure that our sales team is looking out for those opportunities, and we're seeing ourselves winning good ones. Operator: Our next question comes from Tien-Tsin Huang with JPMorgan. Tien-Tsin Huang: You went through a lot here. Just wanted to ask on just thinking about your expense base and visibility there, given what you talked about, for example, in your prepared remarks on AI and then you have the scaling efforts beyond the Big 4, you're scaling SFS. I'm just curious, is there any change in your visibility on expenses, especially given AI inference costs, maybe some productivity of people, that kind of thing? Cosmin Pitigoi: We -- I think we've obviously gained quite a bit of better visibility into our OpEx as we've dug deeper in the last -- over the last few years, as we've gone through a lot of transformation. I think -- think of the improvements from the transformation investments as benefiting sort of three different components of the business. One is just the individual Flymate. Once you hand them a lot of these AI tools, I think everyone is individually more productive and then functions and enterprise. So functions are becoming more productive. We give you examples all the time around client service, but sales and marketing, risk, operations, payments, I mean certainly, the engineering team all have access to the latest kind of LLMs and most of the codes being written through that. So it's a good share of that. And then obviously, G&A, we're watching the opportunity to reduce manual work. So all those things are benefiting along the way. And so we haven't had any surprises as far as OpEx. And so we feel pretty good that we -- again, this year is up kind of in the mid- to low single digits next year, as you kind of look at the implied, it will be in the low to mid-single-digit growth. And then again, based on what you heard from my prepared remarks, expect it to be relatively flat, and we feel quite good about that, just given the visibility into the cost base and the improvements on the transformation side, which really hit on the enterprise level opportunities for us to be more efficient across the whole enterprise, which is quite unique, I think, for us in terms of the approach to transformation. Tien-Tsin Huang: That's great, Cosmin. And I think you said -- real quick, just on the M&A front, it sounds like you're still being patient there. I'm just curious if that's an appetite thing or resourcing or maybe a valuation-driven patience. Any additional color? Michael Massaro: Tien-Tsin, it's Mike. I think we continue to like to see the organic investment opportunities we have in front of us. I would say, from a capital allocation perspective, if there's a chance to buy back our stock, we still think there's some dislocation there. And so think of us as being very active, but also knowing we have two deals that we're continuing to integrate and want to make sure they go well. So our team is still paying attention quite well to what's out there in the market, and we have to find the right balance of something that fits our strategy, something that is, we believe, good for shareholders and also something that we think is priced at a reasonable rate that makes it interesting and exciting for us. And I think you still see some of that private public dislocation valuation. So being patient, but again, I don't think we're missing out on anything right now. Operator: Our next question comes from Jeff Cantwell with Seaport Research. Jeffrey Cantwell: I wanted to ask you about the future $1 billion in revenue and 30% adjusted EBITDA margins. Those numbers both are positive here. As you think ahead, can you maybe help us out on the timing? Do you see that happening perhaps in 2 or maybe 3 years, for example? Just trying to get a feel for that because if current trends hold, it seems like those potentially can happen sooner rather than later. And just to underline what Dan asked about, are there any particular callouts from a vertical standpoint as you think about the $1 billion target in particular? It seems like Sertifi and core travel have been doing well for a decent amount of time. So curious if that's the reason for the confidence in this $1 billion target. Are you able to talk more about that? Cosmin Pitigoi: Thanks, Jeff. So we're obviously very excited about this milestone and since it's coming closer into our sight as part of our normal sort of planning cycle, think of it as our normal 3-year planning cycle. We didn't want to put a date out there, a specific fiscal year. Think of it less as a kind of point in time, more of a milestone and moving through it. But I think one way to think about it is -- listen, we've given you also roughly 25% EBITDA margins into next year. That gives you some level of a stepping stone. And so I think in terms of the mix, we may get to a sustainable annualized run rate of the revenue or the margin at different points in time, around that sort of the 3-year planning, whether that's 12 months around that. We're not too stressed about that. We feel good about this overall number. And again, remember, we've taken the same approach with this, which is prudent, and it is all organic. So it gives us, I think, optionality in the future. And you do the math on the free cash flow, I think it's quite an exciting view from a free cash flow and share count perspective, given the dilution targets that we've also kind of set out. Michael Massaro: And Jeff, I'll just add, this is Mike. I would say we expect all our verticals to contribute to getting to that milestone. But if you look at really some of the stuff we're seeing adding more software and geographic growth in non-top core and education being notable. If you look at travel, the combination of the luxury experiential and hospitality businesses, both are seeing really good metrics, right? Deal size being increased, sales cycles trending faster, I feel really good about our ability to layer in additional products, different geographies, subsegments into that business. So we feel really good about the path to get there, and we have lots of different growth levers to help us. Jeffrey Cantwell: Okay. And then my other one was the announcement about Driftwood that you guys highlighted during the quarter, they have brands like Marriott and Hyatt and Hilton under their umbrella. So I'm curious if you could tell us anything on how that came about since I thought that was an interesting call out by you guys to talk about it within the hospitality vertical. It also sounded like a land and expand opportunity you guys executed on. So I just want to get more details and hear you guys talk about that? And maybe anything on what the ramping is that we should be aware of there as far as revenue and volume and so forth. Rob Orgel: So this is Rob speaking. Just a quick reminder of sort of the structure of the industry. You have the major brands. You have hospitality management companies that tend to either own or operate a whole series of hotels. They may operate them under multiple different brand marquees. And then you've got the properties themselves. So Driftwood is a great example of a hospitality management company with a great portfolio of clients. They have worked with us across a whole bunch. And as you saw in the press release, we're doing sign and pay authorization and payment across a whole range of their properties. Operator: We'll conclude today's question-and-answer session. This concludes today's conference call. Thank you for participating. You may now disconnect. Before you buy stock in Flywire, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Flywire wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. 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As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Flywire (FLYW) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Find your next quality investment with Simply Wall St's easy and powerful screener, trusted by over 7 million individual investors worldwide. Flywire (FLYW) has attracted fresh attention after reporting second quarter 2026 results alongside an update on its ongoing share repurchase program, giving investors new data on both operating performance and capital returns. The company reported second quarter sales of US$167.74 million compared with US$131.89 million a year earlier. Net loss for the quarter was US$8.15 million compared with a loss of US$12.01 million in the prior year period, with basic and diluted loss per share from continuing operations at US$0.07 compared with US$0.10. For the first six months of 2026, Flywire reported sales of US$355.86 million compared with US$265.34 million a year earlier. The company moved from a net loss of US$16.17 million in the prior year period to net income of US$4.37 million, with basic earnings per share from continuing operations of US$0.04 and diluted earnings per share of US$0.03, compared with basic and diluted losses of US$0.13 a year ago. Alongside earnings, Flywire reported it had repurchased 3,100,000 shares from 1 April 2026 to 30 June 2026 for US$49 million, representing 2.51% of its shares. Since the buyback program was announced on 6 August 2024, the company has now repurchased 12,017,714 shares for US$177.09 million, or 9.73% of its shares. See our latest analysis for Flywire. At a share price of US$17.78, Flywire’s recent earnings and buyback update comes after a 27.91% year to date share price return and a 50.81% total shareholder return over the past year. However, the 3 year and 5 year total shareholder returns remain significantly negative, which suggests recent momentum has picked up from a weaker long term base. If Flywire’s story has you watching payment and software platforms more closely, it can be useful to broaden your watchlist with other growth-focused financial technology stocks through 20 top founder-led companies After Flywire’s sharp rebound and sizeable buyback, the stock now sits between improved profitability and a still weak longer term return record. Does that balance of risk and reward still tilt in favour of new buyers at today’s price? With Flywire last closing at US$17.78 and the most followed narrative putting fair value at about US$20.38, the stock sits at a clear valuation gap that hinges on how its growth and margin story plays out. Read the complete narrative. Want to see why this narrative thinks Flywire can support a higher fair value? The core assumptions sit in a stepped shift in revenue, margins, and earnings power that is described as far from conservative. Result: Fair Value of $20.38 (UNDERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, Flywire’s story could shift quickly if regulatory changes affect education flows or if faster growing, lower margin segments continue to pressure overall profitability. Find out about the key risks to this Flywire narrative. The first narrative around Flywire leans on future growth, margins and a fair value of about US$20.38, which implies the stock is undervalued. The P/E picture tells a very different story. Flywire trades on 63.6x earnings compared with 17.1x for the US Diversified Financial industry and 18.9x for peers, while the fair ratio is 24.8x. That gap suggests investors are already paying a heavy premium. The question is whether the growth and margin path justifies that kind of multiple risk. See what the numbers say about this price — find out in our valuation breakdown. 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We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include FLYW. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Find winning stocks in any market cycle. Join 7 million investors using Simply Wall St's investing ideas for FREE. Flywire stock has rebounded strongly in the short term, yet its longer term share price record and mixed valuation signals leave the intrinsic value estimate pointing to upside while earnings based multiples lean the other way. Over the past 5 years Flywire has delivered a share price decline of 55.6%, which means the recent strength still sits against a weak longer term return profile. Recent revenue growth and improved free cash flow can support a higher intrinsic value for Flywire, but investor expectations around maintaining that growth and profitability leave the earnings multiple exposed if momentum cools. Flywire currently passes 2 of 6 valuation checks. This means the broader set of tests leans expensive rather than a clear bargain, even though the Excess Returns model suggests it may be undervalued. The issue now is whether Flywire's current share price already reflects the intrinsic value suggested by the Excess Returns model, or if there is still a reasonable margin between the two. Flywire delivered 50.8% returns over the last year. See how this stacks up to the rest of the Diversified Financial industry. The Excess Returns model evaluates how much profit Flywire can generate on its equity above the cost of that equity. For Flywire, the model uses a book value base of $6.71 per share and a stable earnings power of $1.17 per share, with those figures drawn from forward-looking estimates by four analysts. The average Return on Equity assumption of 14.30% sits above a calculated cost of equity of $0.60 per share, which results in an excess return of $0.57 per share that is capitalised into the valuation. Based on these inputs, the Excess Returns framework arrives at an intrinsic value estimate of $24.05 per share, which implies the stock is about 26.1% undervalued relative to the current market price. The model also incorporates a stable book value of $8.20 per share, again grounded in analyst estimates, which supports the view that Flywire can continue generating returns above its funding cost. Because Flywire reported Q2 2026 results that beat revenue expectations and showed positive free cash flow, the current discount suggests the market is not fully recognising that earnings and cash flow profile. Overall, the Excess Returns analysis indicates Flywire stock appears undervalued compared with its assessed intrinsic value. Our Excess Returns analysis suggests Flywire is undervalued by 26.1%. Track this in your watchlist or portfolio, or discover 49 more high quality undervalued stocks. Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Flywire. The P/E ratio is a useful way to see what investors are currently willing to pay for each dollar of Flywire earnings. Flywire trades on a P/E of about 63.6x, which is materially higher than the Diversified Financial industry average of 17.1x and the peer group average of 18.9x. That puts the stock on a clear premium earnings multiple relative to similar businesses. The tailored fair P/E for Flywire, which adjusts for its growth outlook, margins, size and risk profile, is estimated at 24.8x. This sits well below the current 63.6x multiple. The gap suggests investors are paying a high price for Flywire’s earnings compared with what this framework flags as a more balanced level, even after factoring in the company specific assumptions. On the P/E multiple, Flywire stock screens as overvalued compared with both its tailored fair ratio and sector benchmarks. See what the numbers say about this price — find out in our valuation breakdown. Simply Wall St Narratives pick up where Flywire's valuation puzzle leaves off and spell out which combinations of future growth, margins and earnings would need to hold for the stock to be worth materially more or less than today's price, based on different investor viewpoints. Each narrative ties its number to a specific view of how Flywire's growth, profitability and risks might evolve, so you can revisit those assumptions as new information comes through on the Community page. Community views on Flywire sit on a wide spectrum, with one side focused on execution and expansion and the other worried about structural pressure on margins. Bull case: 13% undervalued Read the full Bull Case to see why Flywire could be undervalued Bear case: 11% overvalued Read the full Bear Case to see why Flywire could be overvalued Do you think there's more to the story for Flywire? Head over to our Community to see what others are saying! For Flywire, the intrinsic value estimate points to the stock trading at a discount, while the earnings multiple signals it is overvalued relative to peers and its tailored fair P/E. That split reflects different lenses. The Excess Returns view leans on funding needs, capital intensity and the timing of cash flows, while the market multiple leans on how much growth and profitability investors are currently baking in. With a low broader value score, the key question is whether Flywire can sustain the earnings and margin profile that would justify its premium P/E, or whether the current discount to intrinsic value is a value trap rather than an opportunity. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include FLYW. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Interested in Airbnb, Inc.? Here are five stocks we like better. Airbnb delivered a strong second quarter, with revenue up 17% year over year to $3.6 billion, gross booking value up 16% to $27.2 billion, and adjusted EBITDA of $1.3 billion. Nights and seats booked grew 10%, while app bookings rose 23%. AI and product expansion are accelerating growth and efficiency. Airbnb increased feature releases nearly 80%, reduced product launch times by up to 60%, and resolved nearly 45% of assistant-initiated customer issues without human agents; the company is also expanding hotels, services and experiences. Airbnb raised its 2026 outlook to at least mid-teens revenue growth and an adjusted EBITDA margin of at least 35.5%. The company also repurchased $1.1 billion of stock in the quarter and generated $1.3 billion in free cash flow. Why Flywire and Airbnb Could Be Quiet Winners of a Ceasefire Airbnb (NASDAQ:ABNB) reported second-quarter 2026 results that exceeded its outlook, with revenue rising 17% year over year to $3.6 billion and gross booking value increasing 16% to $27.2 billion. Nights and seats booked grew 10%, accelerating from the first quarter, while adjusted EBITDA reached $1.3 billion, representing a 35% margin. Chief Executive Officer Brian Chesky said the company’s momentum reflected a combination of product changes rather than a single initiative. He pointed to higher app usage, faster growth among first-time bookers, expansion-market gains and improving trends in several core markets. → 3 Drone Stocks That Should Soar After the Summer Slump Trip.com’s Selloff Raises a Bigger Question About Its Travel Recovery Story “There was no single product, there’s no single partnership or initiative that explains our results,” Chesky said. “It’s a combination of stronger execution, a world-class team, and an innovation model that is accelerated by AI.” Nights booked through Airbnb’s app increased 23% year over year and accounted for 64% of total nights booked, up from 59% a year earlier. Growth among first-time bookers accelerated to 11%, the highest rate the company has reported in four years, according to Chesky. Gen Z represented the fastest-growing cohort of first-time bookers. → Meta’s Earnings Drop Shows Wall Street Wants More Than Ad Growth Uber's Annual Product Showcase Reveals It Is Coming for Airbnb and Booking Expansion markets grew about twice as quickly as core markets, while the U.S., France, the U.K. and Australia all saw accelerating growth during the quarter. Chief Financial Officer Ellie Mertz said North America and Europe produced high-single-digit growth in nights and seats booked, Latin America grew about 20%, and Asia-Pacific posted high-teens growth. Average daily rate increased 5% year over year, or 4% excluding foreign exchange effects, with strength in North America and Europe. Mertz said the company’s growing mix of larger homes has supported ADR, as bedroom-night growth has exceeded growth in overall nights booked. → Jersey Mike's Serves Fresh Gains After IPO Stumble Airbnb attributed part of its growth to improvements across search, sign-up, checkout, payments and host tools. The company introduced AI-generated listing and review highlights, while expanding Reserve Now, Pay Later eligibility and visibility throughout the booking process. The flexible payment option accounted for more than 20% of total gross booking value in the second quarter, Mertz said. The company also plans to introduce AI-powered home comparison later this year and began testing AI search during the current quarter. Chesky said the feature will initially be available to a small percentage of traffic through an optional toggle, with broader expansion dependent on test results. Chesky said Airbnb has rebuilt its operations to become an “AI-native” company, allowing it to reduce the time from product concept to launch by as much as 60% for some initiatives. During the first six months of the year, the company increased the number of features and improvements it released by nearly 80% compared with the same period in 2025. Airbnb’s AI assistant is now available in more than 50 languages. Nearly 45% of customer issues that begin with the assistant are resolved without a human agent, Chesky said. Customer support costs per booking declined about 16% from a year earlier in the second quarter, partly due to the AI assistant. The company expects to begin offering AI voice support later this year. Mertz said Airbnb’s updated guidance assumes increased AI spending, but the company is expanding margins while absorbing those costs. She also said AI-driven productivity means Airbnb does not need to increase headcount at the same pace as in prior periods. Airbnb continued to broaden its offerings beyond homes, adding boutique and independent hotels, expanding travel-related services and increasing the supply of experiences. Hotels remain a single-digit percentage of nights booked but are growing about three times faster than the homes business, according to the company. Chesky said the hotel initiative has received stronger-than-expected interest from hotel operators. The company has expanded hotel supply acquisition efforts to roughly 20 cities, Mertz said, while seeking inventory that complements rather than competes directly with home listings. About 35% of first-time hotel guests subsequently return to Airbnb to book a home, Chesky said. He added that hotel inventory has improved conversion in both supply-constrained markets and markets where Airbnb already has substantial accommodation supply. Airbnb also added services including grocery delivery, car rentals, airport pickup, luggage storage and resort passes. Chesky said car rentals are expected to be the largest service category because of the size of the market and because reservation lengths have exceeded the company’s expectations. The company plans to expand car rentals internationally. Experiences supply rose nearly 80% year over year in the second quarter following the addition of 1,000 experiences in high-demand categories. Bookings accelerated both year over year and sequentially, although Chesky said the business remains small and will be a longer-term contributor relative to homes and hotels. Second-quarter net income was $816 million, aided by higher operating income and a $77 million tax benefit related to recently published tax guidance affecting prior-year taxes. Airbnb generated $1.3 billion in free cash flow during the quarter and $4.8 billion over the trailing 12 months, equal to a 37% free-cash-flow margin. During the quarter, the company repurchased $1.1 billion of common stock. Mertz said returning capital to shareholders remains a core part of Airbnb’s capital-allocation strategy. Third-quarter revenue is expected to be between $4.69 billion and $4.77 billion, representing 15% to 17% year-over-year growth. The third-quarter outlook includes an estimated three-percentage-point foreign exchange tailwind after hedging. Third-quarter gross booking value is expected to grow in the mid-teens, supported by low-double-digit growth in nights and seats booked and a moderate ADR increase. Adjusted EBITDA is expected to increase year over year in the third quarter, though the margin is expected to decline slightly from the third quarter of 2025 because of investment timing. For full-year 2026, Airbnb raised its revenue-growth outlook to at least the mid-teens and increased its adjusted EBITDA margin outlook to at least 35.5%, from a prior forecast of 35%. Mertz said the company expects its full-year implied take rate to remain relatively flat compared with 2025, reflecting the timing effects of Reserve Now, Pay Later and higher customer incentives tied to newer businesses. Excluding those incentives, Airbnb would have expected a slightly higher implied take rate, she said. Airbnb, Inc (NASDAQ: ABNB) operates a global online marketplace that connects travelers with hosts offering short-term lodging, unique accommodations and related travel experiences. The company's core platform enables individuals and professional property managers to list private homes, apartments, single rooms and entire properties, while providing search, booking and payment processing for guests. Airbnb earns revenue primarily through service fees charged to guests and hosts and offers tools to facilitate reservations, communications, and logistics between parties. Beyond accommodations, Airbnb has expanded its product portfolio to include curated experiences led by local hosts, higher-end offerings such as Airbnb Luxe, and programs aimed at enhancing quality and safety like Airbnb Plus. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Airbnb Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Interested in Flywire Corporation? Here are five stocks we like better. Flywire exceeded its second-quarter expectations, with revenue less ancillary services rising 28% year over year to $164 million and adjusted EBITDA increasing to $24 million. Travel, hospitality, healthcare and B2B payment-processing ramps were key growth drivers. The company raised its 2026 outlook to 21%–27% FX-neutral revenue growth and approximately 23% adjusted EBITDA margin at the midpoint, while projecting more than $50 million in GAAP net income and 70%–75% free-cash-flow conversion. Flywire remains cautious about international education due to visa and regulatory pressures, but is diversifying geographically and expanding its Student Financial Services platform, hospitality business and AI-driven automation initiatives. Why Flywire and Airbnb Could Be Quiet Winners of a Ceasefire Flywire (NASDAQ:FLYW) reported second-quarter results that exceeded its expectations, led by travel performance, hospitality payment processing and stronger-than-anticipated contributions from healthcare and B2B payment-processing ramps. The company also raised its full-year revenue and adjusted EBITDA outlook, while maintaining a cautious posture toward international student visa trends in major education markets. Total revenue less ancillary services reached $164 million, up more than 28% year over year on a spot basis and 27% on an FX-neutral basis, Chief Financial Officer Cosmin Pitigoi said. Transaction revenue increased 35% to $135.9 million, supported by 43% growth in transaction payment volume. Adjusted gross profit rose 19% to $93 million, while adjusted EBITDA increased to $24 million, producing a 14.6% margin and approximately 160 basis points of year-over-year expansion. → SpaceX’s First Earnings Report Could Decide Whether Shorts or Bulls Have Control The company recorded a GAAP net loss of $8 million in the quarter, improving from a $12 million loss in the prior-year period. Pitigoi said the second quarter is Flywire’s smallest revenue quarter seasonally and that net income and free cash flow are expected to be strongly positive for the full year. Pitigoi said Flywire’s revenue outperformance versus the midpoint of its outlook was driven largely by travel, where hospitality payments ramped faster than expected. Education revenue also exceeded internal expectations. → Financials Hit Record Highs as the AI Trade Unravels—Can They Keep Leading? Payment processing in healthcare and the migration of B2B invoice customers added an approximately seven-point growth tailwind to payment processing during the quarter, above the mid-single-digit contribution Flywire had anticipated. The company expects that benefit to decelerate in the second half as it annualizes the related go-lives. Adjusted gross margin was 56.6%, down about 450 basis points year over year. Pitigoi attributed roughly 300 basis points of the decline to the mix effect of higher payment-processing revenue from healthcare and B2B. He said the remaining decline reflected continued changes in vertical mix, rather than pricing pressure or less-disciplined competition. → Why Rare Earth Processing Could Be the Real 2027 Opportunity “Processing volume carries the lower gross margin rate, but very little incremental OpEx because it runs over infrastructure and relationships we already have,” Pitigoi said, adding that these revenue streams can still convert gross profit dollars to EBITDA at a high rate. Chief Executive Officer Mike Massaro said Flywire continues to operate in a difficult international education environment, citing negative visa trends in the United Kingdom, higher visa fees in Australia and more stringent regulations in the U.S. and U.K. The company’s guidance incorporates an assumed 30% decline in U.S. visas, which management described as a prudent approach. Despite those pressures, Flywire said it is gaining share and expanding outside its traditional core education markets of the U.S., U.K., Canada and Australia. Education revenue from markets outside those four countries grew more than 30% year over year in the second quarter, and roughly two-thirds of new education clients signed during the quarter were in those growth markets. President and Chief Operating Officer Rob Orgel pointed to momentum in continental Europe, including share gains in Spain and Switzerland, as well as activity in South Korea and Japan, where institutions are seeking international enrollment. The company also cited wins in Canada and Australia, including Sheridan College and Bond University. Flywire signed more than 200 new clients across 45 countries and all of its verticals, matching the level reached in the first quarter. Travel led new-client additions, followed by education, according to Orgel. In education, the company is emphasizing its Student Financial Services, or SFS, platform, which combines billing, payment plans, collections and payment processing. Flywire signed the University of Liverpool for SFS in the U.K. and signed three new U.S. SFS deals whose combined annual recurring revenue was double that of signings in the comparable 2025 quarter. Orgel said clients using SFS have in some cases reduced inbound student-contact volume by 40%. He also said self-service payment plans have increased plan enrollment by roughly 50%, while default rates have declined from as high as 34% to below 2%. Flywire clients have collected more than $360 million in past-due tuition in-house, saving more than $70 million in agency fees, according to the company. Flywire’s hospitality software is used across more than 20,000 properties, Orgel said. The company has won contracts with hotel management groups including Peregrine Hospitality, Avion Hospitality and Marcus Hotels & Resorts. It has also signed more than 40 hospitality locations in Europe and Asia year to date as it expands a business that was historically concentrated in the U.S. Management said artificial intelligence is increasingly being deployed in support, engineering and sales operations. Massaro said about 45% of customer inquiries are now resolved automatically without human intervention, with a target to exceed a 50% automated-resolution rate by year-end. The company is also using AI tools and autonomous agents for tasks including code retirement, bug fixes, test maintenance and sales coaching. Flywire views these initiatives as part of a broader digital transformation intended to lower its cost to scale and generate operating leverage. Massaro reiterated Flywire’s longer-term goal of reaching $1 billion in annual organic revenue and a 30% adjusted EBITDA margin over the next few years. Pitigoi said the company is targeting approximately a 25% adjusted EBITDA margin by 2027 and expects transformation investment to peak that year, with material savings expected afterward. Flywire raised its full-year 2026 outlook and now expects FX-neutral revenue growth of 21% to 27%. The forecast includes approximately three to four percentage points of growth from B2B and healthcare payment-processing ramps, as well as roughly 1.5 percentage points of inorganic contribution as the company laps Sertifi. Adjusted gross profit is expected to grow in the high teens year over year on a spot basis. Adjusted EBITDA margin is expected to expand by roughly 200 to 400 basis points, reaching about 23% at the midpoint. Free cash flow conversion is expected to equal 70% to 75% of adjusted EBITDA. GAAP net income is expected to increase more than fourfold to over $50 million. Stock-based compensation is targeted at approximately 10% of revenue, with less than 2% dilution targeted for 2026. For the third quarter, Flywire expects FX-neutral revenue growth of 16% to 22%, low-teens gross profit dollar growth at spot rates, and roughly 200 basis points of adjusted EBITDA margin expansion at the midpoint. Management cautioned that education payment timing around U.K. deadlines and Chinese holidays could affect the quarter-to-quarter distribution of second-half revenue. Flywire Corp (NASDAQ: FLYW) is a global payments enablement and software company that specializes in facilitating complex cross-border transactions. Its cloud-based platform streamlines receivables and payer workflows across key verticals including education, healthcare, travel and hospitality, and commercial services. Flywire's technology integrates with institutional systems to automate payment posting, reconciliation and reporting, aiming to improve the payer experience and accelerate cash flow for its clients. Founded in 2009 by entrepreneur Iker Marcaide as peerTransfer, the company rebranded as Flywire in 2015. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Flywire Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

This article first appeared on GuruFocus. Revenue: Total revenue less ancillary services reached $164 million, up over 28% on a spot basis and 27% FX-neutral growth. Transaction Revenue: $135.9 million, up 35% year-over-year, driven by 43% growth in transaction payment volume. Platform and Other Revenues: $28 million, up 3% year-over-year, primarily driven by growth in hospitality. Adjusted Gross Profit: Reached $93 million, increasing 19% year-over-year at spot. Adjusted Gross Margin: 56.6%, down approximately 450 basis points, primarily due to mix from higher payment processing revenues. Adjusted EBITDA: $24 million, resulting in a 14.6% margin, expanding approximately 160 bps year-over-year. GAAP Net Loss: $8 million, improving versus a $12 million loss a year ago. Corporate Cash: Approximately $167 million. Warning! GuruFocus has detected 3 Warning Sign with FLYW. Is FLYW fairly valued? Test your thesis with our free DCF calculator. Release Date: August 04, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Flywire Corp (NASDAQ:FLYW) delivered strong Q2 2026 results with total revenue less ancillary services up over 28% year-over-year, exceeding expectations. The company signed over 200 new clients across 45 countries for the second consecutive quarter, with larger average deal sizes and strong momentum in travel and education. Flywire Corp (NASDAQ:FLYW) is successfully executing its software-led monetization strategy, with SFS deals in the U.S. doubling in ARR year-over-year and strong international expansion in hospitality. The company is making significant progress in AI integration, with about 45% of customer inquiries now resolved automatically, targeting over 50% by year-end, improving operational efficiency. Flywire Corp (NASDAQ:FLYW) raised its full-year 2026 guidance for both revenue and EBITDA, expecting 21% to 27% FX-neutral revenue growth and approximately 23% adjusted EBITDA margin at the midpoint. The company maintains a strong balance sheet with $167 million in corporate cash, allowing for strategic flexibility in share repurchases and M&A. Flywire Corp (NASDAQ:FLYW) is seeing strong growth outside its traditional Big Four education markets, with education revenue growing over 30% year-over-year in Q2. The company is targeting $1 billion in annual organic revenue and 30% adjusted EBITDA margin over the next few years, with a clear path to achieving these goals. Client retention remains high, with revenue churn across enterprise clients in education and travel below 1% as of 2025. Flywire Corp (NASDAQ:FLYW) is benefiting from strategic vendor consolidation, with clients replacing legacy providers and point solutions to consolidate onto its platform. Flywire Corp (NASDAQ:FLYW) faces a challenging macro environment with negative trends in U.K. visas, increased visa fees in Australia, and more stringent regulations in the U.S. and U.K. The company's adjusted gross margin declined by approximately 450 basis points in Q2, primarily due to mix shifts and temporary payment processing ramps in healthcare and B2B. Flywire Corp (NASDAQ:FLYW) expects U.K. education revenue growth to slow in the second half of 2026, with visa declines assumed to be larger than in recent years. The accelerated ramp of newer revenue streams in 2026 creates tougher comparisons for 2027, potentially leading to lower growth rates. The company's Q3 2026 guidance implies a deceleration in revenue growth to 16% to 22% FX-neutral, down from Q2's 27% growth. Flywire Corp (NASDAQ:FLYW) is assuming a 30% decline in U.S. visa issuances, which could impact education revenue if the decline is worse than expected. The company's GAAP net loss was $8 million in Q2, though improving from a $12 million loss a year ago. Stock-based compensation remains at approximately 10% of revenue, which could pressure earnings and dilution targets. The company's transformation investment peaks in 2027, with material savings expected only after that, potentially limiting near-term margin expansion. Flywire Corp (NASDAQ:FLYW) faces uncertainty from potential new U.S. regulations on international students, which could create demand destruction similar to other geographies. Q: Can you provide more color on the U.S. visa situation, the probability of proposed regulations going through, and whether the assumed 30% visa decline is conservative?A: Mike Massaro (CEO) noted that many headlines are proposed policies, not approved ones, and historically, headlines have been worse than actual results. Cosmin Pitigoi (CFO) confirmed the company is maintaining a prudent 30% decline assumption for U.S. visas, noting they are about a month into the quarter with some visibility into trends, and feel good about the prudent approach taken. Q: How should we think about the mix of the $1 billion organic revenue target across education, travel, B2B, and healthcare, and the timing of achieving this milestone?A: Mike Massaro (CEO) stated that all verticals will contribute, with notable growth from software additions, geographic expansion outside the top four education markets, and the combination of luxury experiential travel and hospitality. Cosmin Pitigoi (CFO) framed it as a milestone within a normal three-year planning cycle rather than a specific fiscal year, with a stepping stone of approximately 25% EBITDA margins by 2027, and emphasized it is all organic growth. Q: Can you elaborate on the three new U.S. SFS signings, which came in at double the ARR of the prior year quarter, and the sustainability of this growth?A: Rob Orgel (President & COO) attributed the strong ARR expansion to a focus on full-suite enterprise deals, a skilled sales team, and a strengthening brand reputation in a connected industry. He expressed confidence in the second-half pipeline and expects the momentum to continue. Q: Given the challenges in the U.K. market, where do you see the most opportunity, and can the region still grow above company rates despite visa headwinds?A: Cosmin Pitigoi (CFO) stated they are assuming larger U.K. visa declines than the mid-teens seen in recent years, but still expect the U.K. to be an important growth driver due to other levers. Rob Orgel (President & COO) highlighted two key mechanisms: increasing the number of clients where Flywire moves 90% or more of their money (now approximately 20, up from 12) and expanding the SFS footprint through more integrations with core systems like Unit4, Oracle, and Tribal. Q: How do you think about the unit economics of SFS over the next few years, given the mix shift toward domestic volumes with lower yields?A: Mike Massaro (CEO) noted that the blend of software and domestic payments remains very positive for gross margins, with improving economics over time as deal sizes increase and renewals strengthen. Cosmin Pitigoi (CFO) added that the U.S. domestic business is about a third of overall revenue and growing above company average, with a solid 2-3x gross profit dollar increase when moving from cross-border to domestic, running over the same cost rails and driving strong EBITDA dollar flow. Q: Can you provide more detail on the expense base and visibility, especially regarding AI inference costs and productivity gains?A: Cosmin Pitigoi (CFO) explained that transformation investments benefit individual employees, functions, and the enterprise. AI tools are making employees more productive across client service, sales, marketing, risk operations, payments, and engineering. He noted no surprises in OpEx, with growth expected in the mid- to low-single digits this year, low- to mid-single digits next year, and relatively flat thereafter, driven by enterprise-level efficiency gains. Q: Can you provide more color on the K-12 business and how it compares to higher education?A: Rob Orgel (President & COO) stated that K-12 is a long-term segment, and the company is now pursuing interesting pockets and markets around the world under the umbrella of diversifying international mobility. The sales team is actively looking for these opportunities and winning good ones. Q: Can you provide more details on the Driftwood hospitality win and the ramping of that relationship?A: Rob Orgel (President & COO) explained that Driftwood is a hospitality management company with a portfolio of properties operating under multiple brand marquees. Flywire is working with them across a whole range of properties, providing sign-and-pay, authorization, and payment solutions, representing a land-and-expand opportunity. Q: Given the stronger revenue guidance this year, how should we think about growth dynamics into 2027?A: Cosmin Pitigoi (CFO) suggested looking at exit rates, with second-half FX-neutral growth in the high teens, but normalizing for payment processing ramps of about 3 points, the underlying growth is closer to mid-teens. He also reminded that Q1 2026 was extremely strong with a mid-single-digit tailwind, which should be considered when modeling next year. Q: Can you provide more color on the non-Big Four education markets and the ability to cross-sell adjacent products in those regions?A: Mike Massaro (CEO) noted that while there are global aspirations for the full education suite, many international markets are not yet ready for the full student account portal and software seen in major markets. The focus remains on executing in the top four markets, but there is longer-term opportunity for other products outside those markets as readiness improves. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Flywire (FLYW) reported $163.8 million in revenue for the quarter ended June 2026, representing a year-over-year increase of 28.5%. EPS of $0.04 for the same period compares to -$0.09 a year ago. The reported revenue compares to the Zacks Consensus Estimate of $154.26 million, representing a surprise of +6.19%. The company delivered an EPS surprise of -55.56%, with the consensus EPS estimate being $0.09. While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectations to determine their next course of action, some key metrics always provide a better insight into a company's underlying performance. Since these metrics play a crucial role in driving the top- and bottom-line numbers, comparing them with the year-ago numbers and what analysts estimated about them helps investors better project a stock's price performance. Here is how Flywire performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts: Total Payment Volume: $8.2 billion compared to the $7.21 billion average estimate based on four analysts. Revenue- Transaction: $135.9 million compared to the $122.6 million average estimate based on three analysts. The reported number represents a change of +35.1% year over year. Revenue Less Ancillary Services- Transaction: $135.9 million compared to the $122.43 million average estimate based on three analysts. The reported number represents a change of +35.2% year over year. Revenue Less Ancillary Services- Platform and other revenues: $28 million versus $28.92 million estimated by three analysts on average. Compared to the year-ago quarter, this number represents a +3.3% change. Revenue- Platform and other revenues: $31.8 million compared to the $33.83 million average estimate based on three analysts. The reported number represents a change of +1.6% year over year. View all Key Company Metrics for Flywire here>>> Shares of Flywire have returned -9.3% over the past month versus the Zacks S&P 500 composite's +1.7% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Flywire Corporation (FLYW) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Flywire Corporation FLYW used its second-quarter 2026 earnings call to emphasize operating leverage, broader growth drivers and a raised outlook despite education-policy uncertainty. Earnings of 4 cents per share missed the Zacks Consensus Estimate of 9 cents. Revenues less ancillary services of $163.8 million topped the $154.3 million estimate, supporting higher 2026 targets. Flywire Corporation price-consensus-eps-surprise-chart | Flywire Corporation Quote Chief financial officer Cosmin Pitigoi raised the 2026 outlook to 21% to 27% FX-neutral revenue less ancillary services growth and 200 to 400 basis points of adjusted EBITDA margin expansion. For the third quarter, management expects 16% to 22% FX-neutral growth and 100 to 300 basis points of adjusted EBITDA margin expansion. Pitigoi tied the higher outlook to travel strength, hospitality payments and B2B and health care processing ramps. He retained cautious education assumptions because of visa-policy pressure. Pitigoi said adjusted gross margin fell about 450 basis points to 56.6%. Roughly 300 basis points came from lower-margin health care and B2B payment-processing ramps. Excluding those ramps, the normalized decline was about 150 basis points, within management’s expected annual range of 100 to 200 basis points. The temporary pressure should be largely complete by year-end. The CFO said these volumes require little incremental operating expense, supporting EBITDA conversion. He targeted an adjusted EBITDA margin of about 25% for 2027, while chief executive officer Mike Massaro reiterated a longer-term 30% goal. President and chief operating officer Rob Orgel said Flywire signed more than 200 new clients across 45 countries for the second straight quarter. Deal sizes are rising as clients consolidate providers and manual workflows. Education revenues outside the United States, United Kingdom, Canada and Australia grew more than 30% year over year. Roughly two-thirds of new education clients came from beyond those four markets. Three new U.S. Student Financial Services deals carried double the ARR of the prior-year quarter’s signings. Orgel also highlighted the University of Liverpool win as evidence of demand for integrated billing, payment plans and collections. Orgel described software as the route to capturing more payment volume across education, hospitality, health care and B2B. Hospitality software serves more than 20,000 properties, with more than 40 locations signed across Europe and Asia year to date. Massaro said about 45% of customer inquiries resolve automatically without human intervention. Flywire is targeting an auto-resolution rate above 50% by year-end while extending AI tools across engineering, sales and operations. Pitigoi said operating-expense growth is running in the mid- to low-single digits this year and should remain in the low- to mid-single digits next year. Costs are expected to become relatively flat after transformation investment peaks in 2027. A Deutsche Bank analyst asked whether proposed U.S. visa restrictions could damage demand. Massaro noted that many measures remain proposals, while Pitigoi kept a prudent assumption for a 30% U.S. visa decline. A Raymond James analyst pressed management on the United Kingdom, which represents about one-quarter of revenues. Pitigoi said U.K. growth should decelerate in the second half and exit below the companywide rate. A Morgan Stanley analyst questioned SFS economics as domestic volume rises. Massaro and Pitigoi said the product captures domestic and cross-border flows, producing a typical two- to threefold increase in gross profit dollars from broader adoption. Management remains focused on expanding the software moat, unifying the payments platform and using digital transformation to create operating leverage. Pitigoi said organic investment, repurchases and M&A compete under an IRR framework. The tone was confident on client wins but measured on visa trends, gross-margin mix and tougher 2027 comparisons. Flywire continues to frame its ambition around $1 billion in annual organic revenue and a 30% adjusted EBITDA margin. FLYW carries a Zacks Rank #3 (Hold). Its Value Score is C, Growth Score is A, Momentum Score is C and VGM Score is B, reflecting stronger growth characteristics and a favorable combined style profile alongside midrange value and momentum readings. The Zacks framework gives greatest emphasis to Zacks Rank #1 (Strong Buy) and #2 (Buy) stocks paired with A or B Style Scores. A Zacks Rank #3 can still be held, but this is not a top-tier near-term signal. The rank can change as earnings estimates are revised after the results. You can see the complete list of today’s Zacks #1 Rank stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Flywire Corporation (FLYW) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Management is pivoting the narrative toward a 'compounding' financial model where complexity in mission-critical workflows acts as a moat against simpler payment competitors. Performance is increasingly driven by strategic vendor consolidation, where clients replace multiple legacy point solutions with Flywire's unified billing-to-collection platform. The 'diversification engine' is successfully offsetting macro headwinds in traditional Big 4 education markets, with education revenue outside those regions growing over 30% year-over-year. Operational leverage is being realized through a digital transformation that integrates AI agents into engineering and customer support, targeting a 50% auto-resolution rate for inquiries by year-end. Management attributes the current gross margin compression to a temporary mix shift from high-growth payment processing ramps in B2B and healthcare, rather than competitive pricing pressure. Strategic positioning in hospitality is shifting from a U.S.-centric model to a global platform, with over 40 new international locations signed year-to-date. Management established a mid-term target of $1 billion in annual organic revenue and 30% adjusted EBITDA margins, supported by durable gross profit growth and operating leverage. Full-year 2026 guidance assumes a prudent 30% decline in U.S. visa issuances and incorporates recent negative trends in U.K. visa rejection rates. Transformation investments are expected to peak in 2027, after which operating expenses are projected to remain roughly flat while revenue continues to scale. Free cash flow conversion is targeted at 70% to 75% of adjusted EBITDA, providing flexibility for opportunistic M&A and share repurchases to manage dilution. Q3 2026 growth rates may appear lower due to a difficult year-over-year comparison caused by the timing of Chinese national holidays and U.K. education deadlines. Reported gross margin decline of 450 basis points includes a 300-basis point impact from temporary payment processing ramps in healthcare and B2B; normalized decline is approximately 150 basis points. Revenue churn across enterprise clients in education and travel remains exceptionally low, reported at below 1% as of 2025. Management is aggressively managing dilution, targeting less than 2% new stock issuance this year and less than 3% on an ongoing basis. Macro risks include more stringent regulations in the U.S. and U.K., alongside increased visa fees in Australia, which are factored into the cautious second-half outlook. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management clarified that the 30% decline assumption remains a prudent, data-dependent buffer against headlines that are often worse than actual policy outcomes. Visibility into the August peak for F-1 visas suggests the current conservative approach is appropriate for the multi-year planning cycle. Signed ARR for SFS deals in the U.S. doubled year-over-year, driven by a shift toward full-suite enterprise engagements rather than point solutions. Domestic payments through SFS carry lower yields but generate 2x to 3x higher gross profit dollars per client due to software fees and increased volume capture. Flywire is mitigating U.K. macro softness by increasing the number of '90% share' clients (moving from 12 to 20) and expanding ERP integrations with providers like Unit4 and Oracle. Management expects the U.K. to exit the year at a lower growth rate than the company average, but remains confident in long-term share gains through software attachment. Management is remaining patient on M&A due to a valuation disconnect between private and public markets. Current priority is organic investment and share repurchases to take advantage of market dislocation while integrating recent acquisitions like Sertifi.